1-1 By: Junell, et al. (Senate Sponsor - Ratliff) H.B. No. 1161 1-2 (In the Senate - Received from the House April 23, 1999; 1-3 April 26, 1999, read first time and referred to Committee on 1-4 Finance; May 6, 1999, reported adversely, with favorable Committee 1-5 Substitute by the following vote: Yeas 10, Nays 0; May 6, 1999, 1-6 sent to printer.) 1-7 COMMITTEE SUBSTITUTE FOR H.B. No. 1161 By: Ratliff 1-8 A BILL TO BE ENTITLED 1-9 AN ACT 1-10 relating to the tobacco settlement permanent trust account. 1-11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-12 ARTICLE 1. DUTIES OF THE COMPTROLLER 1-13 SECTION 1.01. Subchapter G, Chapter 403, Government Code, is 1-14 amended by adding Sections 403.1041, 403.1042, 403.1043, and 1-15 403.1044 to read as follows: 1-16 Sec. 403.1041. TOBACCO SETTLEMENT PERMANENT TRUST ACCOUNT. 1-17 (a) In this section and Sections 403.1042, 403.1043, and 403.1044: 1-18 (1) "Account" means the tobacco settlement permanent 1-19 trust account established under the agreement. 1-20 (2) "Advisory committee" means the tobacco settlement 1-21 permanent trust account investment advisory committee. 1-22 (3) "Agreement" means the Agreement Regarding 1-23 Disposition of Settlement Proceeds filed on July 24, 1998, in the 1-24 United States District Court, Eastern District of Texas, in the 1-25 case styled The State of Texas v. The American Tobacco Co., et al., 1-26 No. 5-96CV-91. The term includes the subsequent Clarification of 1-27 Agreement Regarding Disposition of Settlement Proceeds filed on 1-28 July 24, 1998, in that litigation. 1-29 (4) "Department" means the Texas Department of Health. 1-30 (5) "Political subdivision" means: 1-31 (A) a hospital district; 1-32 (B) another local political subdivision that 1-33 owns or maintains a public hospital; or 1-34 (C) a county of this state responsible for 1-35 providing indigent health care to the general public. 1-36 (b) With the advice of and in consultation with the advisory 1-37 committee, the comptroller shall administer the account and shall 1-38 manage the assets of the account. 1-39 (c) In managing the assets of the account, the comptroller, 1-40 with the advice of and in consultation with the advisory committee, 1-41 may acquire, exchange, sell, supervise, manage, or retain, through 1-42 procedures and subject to restrictions the comptroller establishes 1-43 and in amounts the comptroller considers appropriate, any kind of 1-44 investment that a person of ordinary prudence, discretion, and 1-45 intelligence, exercising the judgment and care under the 1-46 circumstances prevailing at that time, would acquire or retain for 1-47 the person's own account in the management of the person's affairs, 1-48 not in regard to speculation but in regard to the permanent 1-49 disposition of the person's money, considering the probable income 1-50 as well as the probable safety of the capital. Investment and 1-51 management decisions concerning individual investments must be 1-52 evaluated not in isolation but in the context of the investment 1-53 portfolio as a whole and as part of an overall investment strategy 1-54 consistent with the investment objectives of the account. 1-55 (d) The account is a trust account with the comptroller and 1-56 is composed of money paid to the account in accordance with the 1-57 agreement, assets purchased with that money, the earnings of the 1-58 account, and any other contributions made to the account. The 1-59 corpus of the account shall remain in the account and may not be 1-60 distributed for any purpose. The money and other assets contained 1-61 in the account are not a part of the general funds of the state. 1-62 The comptroller may appoint one or more commercial banks, 1-63 depository trust companies, or other entities to serve as a 1-64 custodian of the account's assets. Section 404.071 does not apply 2-1 to the account. 2-2 (e) The comptroller, with the advice of and in consultation 2-3 with the advisory committee, may use the earnings of the account 2-4 for any investment expense, including to obtain the advice of 2-5 appropriate investment consultants for managing the assets in the 2-6 account. 2-7 (f) Subject to Section 403.1044, on certification by the 2-8 department under Subchapter J, Chapter 12, Health and Safety Code, 2-9 the comptroller shall make an annual distribution of the net 2-10 earnings from the account to each eligible political subdivision as 2-11 provided in the agreement regarding disposition of settlement 2-12 proceeds. 2-13 (g) Before December 1 of each year the comptroller shall 2-14 prepare a written report regarding the account during the fiscal 2-15 year ending on the preceding August 31. Not later than January 1 of 2-16 each year the comptroller shall distribute the report to the 2-17 advisory committee, the governor, the lieutenant governor, the 2-18 state auditor, the attorney general, and the Legislative Budget 2-19 Board. The comptroller shall furnish a copy of the report to any 2-20 member of the legislature or other interested person on request. 2-21 The report must include: 2-22 (1) statements of assets and a schedule of changes in 2-23 book value of the investments from the account; 2-24 (2) a summary of the gains, losses, and income from 2-25 investments on August 31; 2-26 (3) an itemized list of the securities held for the 2-27 account on August 31; and 2-28 (4) any other information needed to clearly indicate 2-29 the nature and extent of the investments made of the account and 2-30 the income realized from the components of the account. 2-31 (h) The comptroller shall adopt rules necessary to implement 2-32 the comptroller's duties under this section, including rules 2-33 distinguishing the net earnings of the account that may be 2-34 distributed under Subsection (f) from earnings used for investment 2-35 expenses under Subsection (e) and from the money and assets that 2-36 are the corpus of the account. A rule adopted by the comptroller 2-37 under this subsection must be submitted to the advisory committee 2-38 and may not become effective before the rule is approved by the 2-39 advisory committee. If the advisory committee disapproves a 2-40 proposed rule, the advisory committee shall provide the comptroller 2-41 the specific reasons that the rule was disapproved. 2-42 Sec. 403.1042. TOBACCO SETTLEMENT PERMANENT TRUST ACCOUNT 2-43 INVESTMENT ADVISORY COMMITTEE. (a) The tobacco settlement 2-44 permanent trust account investment advisory committee shall advise 2-45 the comptroller with respect to managing the assets of the tobacco 2-46 settlement permanent trust account. The committee shall provide the 2-47 comptroller guidance with respect to the investment philosophy that 2-48 should be pursued in managing these assets and the extent to which, 2-49 at any particular time, the assets should be managed to maximize 2-50 growth of the corpus or to maximize earnings. Except as provided 2-51 by Section 403.1041(h), the advisory committee serves in an 2-52 advisory capacity only and is not a fiduciary with respect to the 2-53 account. 2-54 (b) The advisory committee is composed of 11 members 2-55 appointed by the advisory committee as follows: 2-56 (1) one member nominated by the comptroller to 2-57 represent a public hospital or hospital district located in a 2-58 county with a population of 50,000 or less or a public hospital 2-59 owned or maintained by a municipality; 2-60 (2) one member nominated by the political subdivision 2-61 that, in the year preceding the appointment, received the largest 2-62 annual distribution paid from the account; 2-63 (3) one member nominated by the political subdivision 2-64 that, in the year preceding the appointment, received the second 2-65 largest annual distribution paid from the account; 2-66 (4) four members nominated by political subdivisions 2-67 that: 2-68 (A) in the year preceding the appointment, 2-69 received the 3rd, 4th, 5th, 6th, 7th, 8th, 9th, 10th, 11th, or 12th 3-1 largest annual distribution paid from the account; and 3-2 (B) do not have a nominee serving on the 3-3 advisory committee at the time of appointment; 3-4 (5) one member nominated by the County Judges and 3-5 Commissioners Association of Texas; 3-6 (6) one member nominated by the North and East Texas 3-7 County Judges and Commissioners Association; 3-8 (7) one member nominated by the South Texas County 3-9 Judges and Commissioners Association; and 3-10 (8) one member nominated by the West Texas County 3-11 Judges and Commissioners Association. 3-12 (c) A commissioners court that sets the tax rate for a 3-13 hospital district must approve any person nominated by the hospital 3-14 district to serve on the advisory committee. 3-15 (d) The advisory committee shall elect the officers of the 3-16 committee from among the members of the committee. 3-17 (e) Members of the advisory committee serve staggered 3-18 six-year terms expiring on August 31 of each odd-numbered year. 3-19 (f) An individual or entity authorized to make an 3-20 appointment or nominate someone for appointment to the advisory 3-21 committee created under this section shall attempt to appoint or 3-22 nominate persons who represent the gender composition, minority 3-23 populations, and geographic regions of the state. 3-24 (g) Members of the advisory committee serve without 3-25 compensation from the trust fund or the state and may not be 3-26 reimbursed from the trust fund or the state for travel expenses 3-27 incurred while conducting the business of the advisory committee. 3-28 (h) The comptroller shall provide administrative support and 3-29 resources to the advisory committee as necessary for the advisory 3-30 committee to perform the advisory committee's duties under this 3-31 section and Section 403.1041. 3-32 (i) Chapter 2110 does not apply to the advisory committee. 3-33 Sec. 403.1043. RESTRICTIONS ON LOBBYING EXPENDITURES. 3-34 (a) A political subdivision receiving a distribution under Section 3-35 403.1041(f) may not use the distribution to pay: 3-36 (1) lobbying expenses incurred by the recipient of the 3-37 distribution; 3-38 (2) a person or entity that is required to register 3-39 with the Texas Ethics Commission under Chapter 305, Government 3-40 Code; 3-41 (3) any partner, employee, employer, relative, 3-42 contractor, consultant, or related entity of a person or entity 3-43 described by Subdivision (2); or 3-44 (4) a person or entity who has been hired to represent 3-45 associations or other entities for the purpose of affecting the 3-46 outcome of legislation, agency rules, ordinances, or other 3-47 government policies. 3-48 (b) The persons or entities described by Subsection (a) are 3-49 not eligible to receive the money or participate either directly or 3-50 indirectly in the distributions made under Section 403.1041(f). 3-51 Sec. 403.1044. USE OF CERTAIN FUNDS. (a) In this section, 3-52 "state hospital or clinic" means: 3-53 (1) any state teaching hospital or clinic under the 3-54 governance and administration of the board of regents of The 3-55 University of Texas System, including a hospital or clinic operated 3-56 at: 3-57 (A) The University of Texas Medical Branch at 3-58 Galveston; 3-59 (B) The University of Texas M. D. Anderson 3-60 Cancer Center; and 3-61 (C) The University of Texas Health Science 3-62 Center at Tyler; and 3-63 (2) the South Texas Hospital. 3-64 (b) Except as provided by Subsection (e), a political 3-65 subdivision that has received a distribution under Section 403.1041 3-66 shall use the distribution as necessary to reimburse a state 3-67 hospital or clinic for any certified unreimbursed health care 3-68 expenditure that: 3-69 (1) the hospital or clinic made for providing health 4-1 care treatment to residents of the political subdivision who were 4-2 eligible for state assistance under Chapter 61, Health and Safety 4-3 Code; and 4-4 (2) was made in the year for which the distribution 4-5 was received. 4-6 (c) A state hospital or clinic that has made unreimbursed 4-7 health care expenditures described in Subsection (b) shall submit 4-8 information relating to those expenditures as required by the Texas 4-9 Department of Health. Not later than the 120th day after the date 4-10 the hospital or clinic has submitted the information to the 4-11 department, the department shall certify to the comptroller, the 4-12 hospital or clinic, and the political subdivision the amount of 4-13 unreimbursed health care expenses described by Subsection (b) that 4-14 have been incurred by the hospital or clinic on behalf of the 4-15 political subdivision. 4-16 (d) After receiving a certification of money owed under this 4-17 section, the comptroller may not make a subsequent annual 4-18 distribution to a political subdivision until the state hospital or 4-19 clinic notifies the comptroller that the amount certified under 4-20 this section has been paid or that the debt has been settled and 4-21 all claims against the political subdivision for the debt have been 4-22 released. 4-23 (e) A political subdivision is not required to pay the 4-24 unreimbursed health care expenditures of the South Texas Hospital 4-25 to the extent that those expenditures relate to the care and 4-26 treatment of patients with tuberculosis. 4-27 SECTION 1.02. (a) Notwithstanding Section 403.1042(b), 4-28 Government Code, as added by this Act, the initial tobacco 4-29 settlement permanent trust account investment advisory committee is 4-30 composed of the following 11 members: 4-31 (1) one member appointed by the comptroller to 4-32 represent a public hospital or hospital district located in a 4-33 county with a population of 50,000 or less or a public hospital 4-34 owned or maintained by a municipality that is not otherwise 4-35 represented under this subsection, for a term expiring August 31, 4-36 2003; 4-37 (2) one member appointed by the Harris County 4-38 Commissioners Court for a term expiring August 31, 2001; 4-39 (3) one member appointed by the Dallas County 4-40 Commissioners Court for a term expiring August 31, 2001; 4-41 (4) one member appointed by the Tarrant County 4-42 Hospital District for a term expiring August 31, 2005; 4-43 (5) one member appointed by the El Paso County 4-44 Hospital District for a term expiring August 31, 2005; 4-45 (6) one member appointed by the Nueces County 4-46 Commissioners Court for a term expiring August 31, 2005; 4-47 (7) one member appointed by the Montgomery County 4-48 Hospital District for a term expiring August 31, 2005; 4-49 (8) one member appointed by the County Judges and 4-50 Commissioners Association of Texas for a term expiring August 31, 4-51 2001; 4-52 (9) one member appointed by the North and East Texas 4-53 County Judges and Commissioners Association for a term expiring 4-54 August 31, 2003; 4-55 (10) one member appointed by the South Texas County 4-56 Judges and Commissioners Association for a term expiring August 31, 4-57 2003; and 4-58 (11) one member appointed by the West Texas County 4-59 Judges and Commissioners Association for a term expiring August 31, 4-60 2003. 4-61 (b) On the expiration of the term of the member appointed 4-62 under Subsection (a)(1) of this section, the advisory committee 4-63 shall fill the vacancy under Section 403.1042(b)(1), Government 4-64 Code, as added by this Act. 4-65 (c) On the expiration of the term of the member appointed 4-66 under Subsection (a)(2) of this section, the advisory committee 4-67 shall fill the vacancy under Section 403.1042(b)(2), Government 4-68 Code, as added by this Act. 4-69 (d) On the expiration of the term of the member appointed 5-1 under Subsection (a)(3) of this section, the advisory committee 5-2 shall fill the vacancy under Section 403.1042(b)(3), Government 5-3 Code, as added by this Act. 5-4 (e) On the expiration of the term of a member appointed 5-5 under Subsection (a)(4), (5), (6), or (7) of this section, the 5-6 advisory committee shall fill the vacancy under Section 5-7 403.1042(b)(4), Government Code, as added by this Act. 5-8 (f) On the expiration of the term of the member appointed 5-9 under Subsection (a)(8) of this section, the advisory committee 5-10 shall fill the vacancy under Section 403.1042(b)(5), Government 5-11 Code, as added by this Act. 5-12 (g) On the expiration of the term of the member appointed 5-13 under Subsection (a)(9) of this section, the advisory committee 5-14 shall fill the vacancy under Section 403.1042(b)(6), Government 5-15 Code, as added by this Act. 5-16 (h) On the expiration of the term of the member appointed 5-17 under Subsection (a)(10) of this section, the advisory committee 5-18 shall fill the vacancy under Section 403.1042(b)(7), Government 5-19 Code, as added by this Act. 5-20 (i) On the expiration of the term of the member appointed 5-21 under Subsection (a)(11) of this section, the advisory committee 5-22 shall fill the vacancy under Section 403.1042(b)(8), Government 5-23 Code, as added by this Act. 5-24 SECTION 1.03. Not later than the 30th day after the 5-25 effective date of this Act: 5-26 (1) each appointing authority shall make the 5-27 appointment to the tobacco settlement permanent trust account 5-28 investment committee required by Section 1.02(a) of this Act; and 5-29 (2) the comptroller shall notify the appointees of the 5-30 time and place of the first meeting of the advisory committee. 5-31 ARTICLE 2. DUTIES OF THE TEXAS DEPARTMENT OF HEALTH 5-32 SECTION 2.01. Chapter 12, Health and Safety Code, is amended 5-33 by adding Subchapter J to read as follows: 5-34 SUBCHAPTER J. TOBACCO SETTLEMENT PROCEEDS 5-35 Sec. 12.131. DEFINITIONS. In this subchapter: 5-36 (1) "Account" has the meaning assigned by Section 5-37 403.1041, Government Code. 5-38 (2) "Advisory committee" means the tobacco settlement 5-39 permanent trust account administration advisory committee. 5-40 (3) "Agreement" has the meaning assigned by Section 5-41 403.1041, Government Code. 5-42 (4) "Political subdivision" has the meaning assigned 5-43 by Section 403.1041, Government Code. 5-44 Sec. 12.132. CERTIFICATION TO COMPTROLLER. The department 5-45 shall collect information relating to the unreimbursed health care 5-46 expenditures of each political subdivision and, based on that 5-47 information and using the formula established in Paragraph 5.B. of 5-48 the agreement, shall certify to the comptroller the percentage of 5-49 each annual distribution to be paid from the account to each 5-50 political subdivision. 5-51 Sec. 12.133. COLLECTION OF INFORMATION. (a) Each political 5-52 subdivision shall submit to the department, in the manner and at 5-53 the time required by the department, information that relates to 5-54 the political subdivision's unreimbursed health care expenditures 5-55 and is required by the department to make the certification under 5-56 Section 12.132. 5-57 (b) Subject to the approval of the advisory committee, the 5-58 board shall adopt rules governing the collection of information 5-59 under Subsection (a). The rules may provide for regular audits of 5-60 randomly selected political subdivisions and may govern the manner 5-61 in which a political subdivision is selected for an audit and the 5-62 selection of an auditor. 5-63 Sec. 12.134. DISPUTES RELATING TO INFORMATION COLLECTED. 5-64 (a) Subject to the approval of the advisory committee, the board 5-65 shall adopt rules under which a political subdivision or agency of 5-66 this state may dispute information submitted by a political 5-67 subdivision under Section 12.133. 5-68 (b) The rules may provide for: 5-69 (1) an audit of the political subdivision that 6-1 submitted the disputed information; 6-2 (2) payment of the costs of the audit by the party to 6-3 the dispute who does not prevail in the dispute; 6-4 (3) a deadline for filing a dispute for a particular 6-5 year; and 6-6 (4) a reasonable monetary penalty to be applied to a 6-7 subsequent annual distribution made to a political subdivision that 6-8 is found to have overstated unreimbursed health care expenditures 6-9 in the information submitted under Section 12.133. 6-10 (c) The monetary penalty applied under Subsection (b)(4) may 6-11 not exceed 10 percent of the amount of the overstatement of 6-12 unreimbursed health care costs. 6-13 (d) A dispute under this section is a contested case for 6-14 purposes of Chapter 2001, Government Code. 6-15 Sec. 12.135. EFFECT OF DISPUTE. A dispute filed under 6-16 department rules adopted under Section 12.134 does not affect the 6-17 percentage of the annual distribution of the earnings from the 6-18 account to be paid to the political subdivision for the year for 6-19 which the information that is the subject of the dispute was 6-20 submitted. 6-21 Sec. 12.136. ADJUSTMENT FOLLOWING AUDIT. (a) If the board 6-22 finds, after an audit conducted under Section 12.133 or 12.134, 6-23 that a political subdivision has overstated unreimbursed health 6-24 care expenditures in the information submitted under Section 12.133 6-25 for any year, the department shall report that fact to the 6-26 comptroller and shall reduce that political subdivision's 6-27 percentage of the subsequent annual distribution of the earnings 6-28 from the account appropriately. 6-29 (b) If a monetary penalty is applied under Section 12.134, 6-30 the department shall also reduce the political subdivision's 6-31 percentage of the subsequent annual distribution of the earnings 6-32 from the account appropriately. 6-33 (c) If a political subdivision is assessed the cost of an 6-34 audit under Section 12.134, the department shall report the amount 6-35 assessed to the comptroller, and the comptroller may withhold that 6-36 amount from the political subdivision's subsequent annual 6-37 distribution. The comptroller may use the amount withheld to 6-38 reimburse the general revenue fund for the cost of the audit. 6-39 Sec. 12.137. TOBACCO SETTLEMENT PERMANENT TRUST ACCOUNT 6-40 ADMINISTRATION ADVISORY COMMITTEE. (a) The tobacco settlement 6-41 permanent trust account administration advisory committee shall 6-42 advise the board on the implementation of the department's duties 6-43 under this subchapter. 6-44 (b) The advisory committee is composed of 11 members 6-45 appointed by the advisory committee as follows: 6-46 (1) one member nominated by the board to represent a 6-47 public hospital or hospital district located in a county with a 6-48 population of 50,000 or less or a public hospital owned or 6-49 maintained by a municipality; 6-50 (2) one member nominated by the political subdivision 6-51 that, in the year preceding the appointment, received the largest 6-52 annual distribution paid from the account; 6-53 (3) one member nominated by the political subdivision 6-54 that, in the year preceding the appointment, received the second 6-55 largest annual distribution paid from the account; 6-56 (4) four members nominated by political subdivisions 6-57 that: 6-58 (A) in the year preceding the appointment, 6-59 received the 3rd, 4th, 5th, 6th, 7th, 8th, 9th, 10th, 11th, or 12th 6-60 largest annual distribution paid from the account; and 6-61 (B) do not have a nominee serving on the 6-62 advisory committee at the time of appointment; 6-63 (5) one member nominated by the County Judges and 6-64 Commissioners Association of Texas; 6-65 (6) one member nominated by the North and East Texas 6-66 County Judges and Commissioners Association; 6-67 (7) one member nominated by the South Texas County 6-68 Judges and Commissioners Association; and 6-69 (8) one member nominated by the West Texas County 7-1 Judges and Commissioners Association. 7-2 (c) A commissioners court that sets the tax rate for a 7-3 hospital district must approve any person nominated by the hospital 7-4 district to serve on the advisory committee. 7-5 (d) The advisory committee shall elect the officers of the 7-6 committee from among the members of the committee. 7-7 (e) The advisory committee may act only on the affirmative 7-8 votes of eight members of the committee. 7-9 (f) Members of the advisory committee serve staggered 7-10 six-year terms expiring on August 31 of each odd-numbered year. 7-11 (g) Appointments to the advisory committee shall be made 7-12 without regard to the race, color, disability, sex, religion, age, 7-13 or national origin of the appointees. 7-14 (h) A member of the advisory committee may not receive 7-15 compensation from the trust fund or the state for service on the 7-16 advisory committee and may not be reimbursed from the trust fund or 7-17 the state for travel expenses incurred while conducting the 7-18 business of the advisory committee. 7-19 (i) The department shall provide administrative support and 7-20 resources to the advisory committee as necessary for the advisory 7-21 committee to perform the advisory committee's duties under this 7-22 subchapter. 7-23 (j) Chapter 2110, Government Code, does not apply to the 7-24 advisory committee. 7-25 Sec. 12.138. APPROVAL OF RULES. A rule to be adopted by the 7-26 board relating to certification of a percentage of an annual 7-27 distribution under Section 12.132 or collection of information 7-28 under Sections 12.132, 12.133, and 12.134 must be submitted to the 7-29 advisory committee and may not become effective before the rule is 7-30 approved by the advisory committee. If the advisory committee 7-31 disapproves a proposed rule, the advisory committee shall provide 7-32 the board the specific reasons that the rule was disapproved. 7-33 Sec. 12.139. ANNUAL REVIEW. The advisory committee shall 7-34 annually: 7-35 (1) review the results of any audit conducted under 7-36 this subchapter and the results of any dispute filed under Section 7-37 12.134; and 7-38 (2) review the rules adopted by the board under this 7-39 subchapter and propose any amendments to the rules the advisory 7-40 committee considers necessary. 7-41 SECTION 2.02. (a) Notwithstanding Section 12.137(b), Health 7-42 and Safety Code, as added by this Act, the initial tobacco 7-43 settlement permanent trust account administration advisory 7-44 committee is composed of the following 11 members: 7-45 (1) one member appointed by the Texas Board of Health 7-46 to represent a public hospital or hospital district located in a 7-47 county with a population of 50,000 or less or a public hospital 7-48 owned or maintained by a municipality that is not otherwise 7-49 represented under this subsection, for a term expiring August 31, 7-50 2003; 7-51 (2) one member appointed by the Harris County 7-52 Commissioners Court for a term expiring August 31, 2001; 7-53 (3) one member appointed by the Dallas County 7-54 Commissioners Court for a term expiring August 31, 2001; 7-55 (4) one member appointed by the Tarrant County 7-56 Hospital District for a term expiring August 31, 2005; 7-57 (5) one member appointed by the El Paso County 7-58 Hospital District for a term expiring August 31, 2005; 7-59 (6) one member appointed by the Nueces County 7-60 Commissioners Court for a term expiring August 31, 2005; 7-61 (7) one member appointed by the Montgomery County 7-62 Hospital District for a term expiring August 31, 2005; 7-63 (8) one member appointed by the County Judges and 7-64 Commissioners Association of Texas for a term expiring August 31, 7-65 2001; 7-66 (9) one member appointed by the North and East Texas 7-67 County Judges and Commissioners Association for a term expiring 7-68 August 31, 2003; 7-69 (10) one member appointed by the South Texas County 8-1 Judges and Commissioners Association for a term expiring August 31, 8-2 2003; and 8-3 (11) one member appointed by the West Texas County 8-4 Judges and Commissioners Association for a term expiring August 31, 8-5 2003. 8-6 (b) On the expiration of the term of the member appointed 8-7 under Subsection (a)(1) of this section, the advisory committee 8-8 shall fill the vacancy under Section 12.137(b)(1), Health and 8-9 Safety Code, as added by this Act. 8-10 (c) On the expiration of the term of the member appointed 8-11 under Subsection (a)(2) of this section, the advisory committee 8-12 shall fill the vacancy under Section 12.137(b)(2), Health and 8-13 Safety Code, as added by this Act. 8-14 (d) On the expiration of the term of the member appointed 8-15 under Subsection (a)(3) of this section, the advisory committee 8-16 shall fill the vacancy under Section 12.137(b)(3), Health and 8-17 Safety Code, as added by this Act. 8-18 (e) On the expiration of the term of a member appointed 8-19 under Subsection (a)(4), (5), (6), or (7) of this section, the 8-20 advisory committee shall fill the vacancy under Section 8-21 12.137(b)(4), Health and Safety Code, as added by this Act. 8-22 (f) On the expiration of the term of the member appointed 8-23 under Subsection (a)(8) of this section, the advisory committee 8-24 shall fill the vacancy under Section 12.137(b)(5), Health and 8-25 Safety Code, as added by this Act. 8-26 (g) On the expiration of the term of the member appointed 8-27 under Subsection (a)(9) of this section, the advisory committee 8-28 shall fill the vacancy under Section 12.137(b)(6), Health and 8-29 Safety Code, as added by this Act. 8-30 (h) On the expiration of the term of the member appointed 8-31 under Subsection (a)(10) of this section, the advisory committee 8-32 shall fill the vacancy under Section 12.137(b)(7), Health and 8-33 Safety Code, as added by this Act. 8-34 (i) On the expiration of the term of the member appointed 8-35 under Subsection (a)(11) of this section, the advisory committee 8-36 shall fill the vacancy under Section 12.137(b)(8), Health and 8-37 Safety Code, as added by this Act. 8-38 SECTION 2.03. Not later than the 30th day after the 8-39 effective date of this Act: 8-40 (1) each appointing authority shall make the 8-41 appointment to the tobacco settlement permanent trust account 8-42 administration committee required by Section 2.02(a) of this Act; 8-43 and 8-44 (2) the commissioner of public health shall notify the 8-45 appointees of the time and place of the first meeting of the 8-46 advisory committee. 8-47 SECTION 2.04. (a) In this section: 8-48 (1) "Account" has the meaning assigned by Section 8-49 403.1041, Government Code, as added by this Act. 8-50 (2) "Agreement" has the meaning assigned by Section 8-51 403.1041, Government Code, as added by this Act. 8-52 (3) "Lump sum trust account" means the lump sum trust 8-53 account established under the agreement. 8-54 (b) The Texas Department of Health may collect information 8-55 under Section 12.133, Health and Safety Code, as added by this Act, 8-56 and may make the certification described by Section 12.132, Health 8-57 and Safety Code, as added by this Act, with respect to the pro rata 8-58 lump sum distributions to be made in 2000 and 2001 under Paragraph 8-59 5.B. of the agreement. 8-60 (c) Subchapter J, Chapter 12, Health and Safety Code, as 8-61 added by this Act, applies to the information to be collected under 8-62 this section in the same manner that it applies to information 8-63 collected with respect to distributions to be made from the 8-64 account. 8-65 (d) To the extent that, in accordance with Section 12.136, 8-66 Health and Safety Code, as added by this Act, the Texas Board of 8-67 Health finds an overstatement of unreimbursed health care 8-68 expenditures in the information collected under this section for 8-69 the pro rata lump sum distribution or if a monetary penalty is 9-1 applied under Section 12.134, Health and Safety Code, the 9-2 applicable percentage of the total distribution to be made to that 9-3 political subdivision in the subsequent year shall be reduced as 9-4 appropriate. 9-5 (e) This section expires December 31, 2002. 9-6 ARTICLE 3. EMERGENCY 9-7 SECTION 3.01. The importance of this legislation and the 9-8 crowded condition of the calendars in both houses create an 9-9 emergency and an imperative public necessity that the 9-10 constitutional rule requiring bills to be read on three several 9-11 days in each house be suspended, and this rule is hereby suspended, 9-12 and that this Act take effect and be in force from and after its 9-13 passage, and it is so enacted. 9-14 * * * * *