By Williams                                           H.B. No. 2367
         77R8105 DAK-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the liability of certain nonprofit organizations and
 1-3     their employees and volunteers.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Section 84.003(1), Civil Practice and Remedies
 1-6     Code, is amended to read as follows:
 1-7                 (1)  "Charitable organization" means:
 1-8                       (A)  any organization exempt from federal income
 1-9     tax under  Section 501(a) of the Internal Revenue Code of 1986 by
1-10     being listed as an exempt organization in  Section 501(c)(3) or
1-11     501(c)(4) of the code, if it is a nonprofit corporation,
1-12     foundation, community chest, or fund organized and operated
1-13     exclusively for charitable, religious, prevention of cruelty to
1-14     children or animals, youth sports and youth recreational,
1-15     neighborhood crime prevention or patrol, fire protection or
1-16     prevention, emergency medical or hazardous material response
1-17     services, or educational purposes, excluding private primary or
1-18     secondary schools, alumni associations and related on-campus
1-19     organizations, or is organized and operated exclusively for the
1-20     promotion of social welfare by being primarily engaged in promoting
1-21     the common good and general welfare of the people in a community;
1-22                       (B)  any bona fide charitable, religious,
1-23     prevention of cruelty to children or animals, youth sports and
1-24     youth recreational, neighborhood crime prevention or patrol, or
 2-1     educational organization, excluding alumni associations and related
 2-2     on-campus organizations, or other organization organized and
 2-3     operated exclusively for the promotion of social welfare by being
 2-4     primarily engaged in promoting the common good and general welfare
 2-5     of the people in a community, and that:
 2-6                             (i)  is organized and operated exclusively
 2-7     for one or more of the above purposes;
 2-8                             (ii)  does not engage in activities which
 2-9     in themselves are not in furtherance of the purpose or purposes;
2-10                             (iii)  does not directly or indirectly
2-11     participate or intervene in any political campaign on behalf of or
2-12     in opposition to any candidate for public office;
2-13                             (iv)  dedicates its assets to achieving the
2-14     stated purpose or purposes of the organization;
2-15                             (v)  does not allow any part of its net
2-16     assets on dissolution of the organization to inure to the benefit
2-17     of any group, shareholder, or individual; and
2-18                             (vi)  normally receives more than one-third
2-19     of its support in any year from private or public gifts, grants,
2-20     contributions, or membership fees; or
2-21                       (C)  a homeowners association as defined by
2-22     Section 528(c) of the Internal Revenue Code of 1986 or which is
2-23     exempt from federal income tax under Section 501(a) of the Internal
2-24     Revenue Code of 1986 by being listed as an exempt organization in
2-25     Section 501(c)(4) of the code.
2-26           SECTION 2. This Act takes effect September 1, 2001, and
2-27     applies only to a cause of action that accrues on or after that
 3-1     date.  An action that accrued before the effective date of this Act
 3-2     is governed by the law applicable to the action immediately before
 3-3     the effective date of this Act, and that law is continued in effect
 3-4     for that purpose.