By: Cain S.B. No. 659 99S0446/1 A BILL TO BE ENTITLED AN ACT 1-1 relating to authorizing state agencies and state employees to 1-2 participate in charitable activities. 1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-4 SECTION 1. Subtitle B, Title 6, Government Code, is amended 1-5 by adding Chapter 667 to read as follows: 1-6 CHAPTER 667. CHARITABLE ACTIVITIES ON STATE PROPERTY 1-7 Sec. 667.001. DEFINITIONS. In this chapter: 1-8 (1) "Charitable organization" means an organization 1-9 that: 1-10 (A) is organized for charitable purposes under 1-11 the Texas Non-Profit Corporation Act (Article 1396-1.01 et seq., 1-12 Vernon's Texas Civil Statutes) or holds a certificate of authority 1-13 issued under that Act; 1-14 (B) is exempt from taxation under Section 1-15 501(a), Internal Revenue Code of 1986, as an organization described 1-16 in Section 501(c)(3) of that code, contributions to which are 1-17 deductible for income tax purposes under Section 170 of that code; 1-18 (C) complies with all applicable federal 1-19 nondiscrimination law, including Chapter 21, Title 42, United 1-20 States Code; 1-21 (D) complies with all state statutes and rules 1-22 relating to charitable organizations; and 1-23 (E) is not a private foundation. 1-24 (2) "Eligible charitable organization" means a 2-1 charitable organization eligible to participate in charitable 2-2 activities on state property as provided by Section 667.003. 2-3 (3) "State agency" means a department, commission, 2-4 board, office, institution of higher education, or other agency of 2-5 state government. 2-6 (4) "State employee" means an employee of a state 2-7 agency. 2-8 (5) "State property" means land and buildings owned, 2-9 leased, or otherwise controlled by the state. 2-10 Sec. 667.002. CHARITABLE ACTIVITIES ON STATE PROPERTY. 2-11 (a) A state employee is entitled to participate in fund-raising 2-12 activities conducted on state property for the benefit of an 2-13 eligible charitable organization. 2-14 (b) A state agency shall adopt rules regarding the location 2-15 and timing of charitable activities conducted under this chapter. 2-16 (c) Participation by a state employee in a charitable 2-17 activity conducted on state property is voluntary. A state agency 2-18 shall inform its employees that participation in charitable 2-19 activities conducted on state property is voluntary. 2-20 (d) The comptroller shall adopt rules establishing a process 2-21 for hearing state employee complaints regarding coercive activity 2-22 in charitable activities conducted on state property. 2-23 Sec. 667.003. ELIGIBILITY OF CHARITABLE ORGANIZATIONS. To 2-24 be eligible to conduct a charitable activity on state property, a 2-25 charitable organization must: 2-26 (1) be governed by a voluntary board of citizens that 3-1 meets at least twice each year to set policy and manage the affairs 3-2 of the organization; 3-3 (2) if the organization's annual budget: 3-4 (A) is less than $100,000, provide a completed 3-5 Internal Revenue Service Form 990 and an accountant's review that 3-6 offer full and open disclosure of the organization's internal 3-7 operations; or 3-8 (B) is equal to or more than $100,000, be 3-9 audited annually in accordance with generally accepted auditing 3-10 standards of the American Institute of Certified Public 3-11 Accountants; and 3-12 (3) not spend more than 25 percent of its annual 3-13 revenue for administrative and fund-raising expenses. 3-14 Sec. 667.004. FUND-RAISING PRACTICES. The fund-raising 3-15 practices of an eligible charitable organization must: 3-16 (1) be dedicated to a public purpose; 3-17 (2) be truthful and consumer-oriented; 3-18 (3) clearly identify and distinguish community-based 3-19 organizations from statewide and international organizations; and 3-20 (4) ensure protection against: 3-21 (A) unauthorized use of a list of contributors 3-22 to the organization; 3-23 (B) payment of commissions, kickbacks, finder 3-24 fees, percentages, bonuses, or overrides for fund-raising; 3-25 (C) mailing of unordered merchandise or tickets 3-26 with a request for money in return; and 4-1 (D) general telephone solicitation of the 4-2 public. 4-3 Sec. 667.005. FUNDS RAISED. (a) All funds collected by 4-4 state employees for the benefit of a charitable organization under 4-5 this chapter shall be deposited in the state treasury within 30 4-6 days after the date of collection. 4-7 (b) The comptroller by rule shall establish procedures for 4-8 the distribution of funds raised under this chapter to eligible 4-9 charitable organizations. 4-10 Sec. 667.006. LIMITATION ON USE OF FUNDS. An eligible 4-11 charitable organization may not use funds raised under this chapter 4-12 to: 4-13 (1) conduct litigation; or 4-14 (2) make expenditures that would require the 4-15 organization to register under Chapter 305 if the organization were 4-16 not an entity exempt from registration under that chapter. 4-17 Sec. 667.007. AUDIT. (a) A state agency may request the 4-18 comptroller or state auditor to audit an eligible charitable 4-19 organization that the state agency reasonably believes has 4-20 misapplied funds raised under this chapter. 4-21 (b) The attorney general may bring an action to recover 4-22 misapplied funds. 4-23 SECTION 2. Section 94.015, Human Resources Code, is amended 4-24 by adding Subsection (d) to read as follows: 4-25 (d) This chapter does not prohibit a state agency from 4-26 permitting a charitable organization to conduct a fund-raising 5-1 activity on state property under Chapter 667, Government Code. 5-2 SECTION 3. The importance of this legislation and the 5-3 crowded condition of the calendars in both houses create an 5-4 emergency and an imperative public necessity that the 5-5 constitutional rule requiring bills to be read on three several 5-6 days in each house be suspended, and this rule is hereby suspended, 5-7 and that this Act take effect and be in force from and after its 5-8 passage, and it is so enacted.