By Sibley S.B. No. 321
77R1030 JMG-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the continuation and functions of the Texas Department
1-3 of Economic Development and the operation, funding, and
1-4 administration of the smart jobs fund program.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 ARTICLE 1. CONTINUATION AND FUNCTIONS OF TEXAS DEPARTMENT
1-7 OF ECONOMIC DEVELOPMENT
1-8 SECTION 1.01. Section 481.001, Government Code, is amended by
1-9 adding Subdivision (5) to read as follows:
1-10 (5) "Council" means the Texas Tourism Coordinating
1-11 Council.
1-12 SECTION 1.02. Section 481.003, Government Code, is amended to
1-13 read as follows:
1-14 Sec. 481.003. SUNSET PROVISION. The Texas Department of
1-15 Economic Development is subject to Chapter 325 (Texas Sunset Act).
1-16 Unless continued in existence as provided by that chapter, the
1-17 department is abolished and this chapter expires September 1, 2003
1-18 [2001].
1-19 SECTION 1.03. Subchapter A, Chapter 481, Government Code, is
1-20 amended by adding Section 481.0031 to read as follows:
1-21 Sec. 481.0031. OVERSITE OF DEPARTMENT. (a) The following
1-22 criteria shall be used to determine if the department has
1-23 successfully implemented the proper management and oversight
1-24 controls of the state's economic development efforts:
2-1 (1) effective development and implementation of a
2-2 strategic plan that:
2-3 (A) ensures a clear focus and direction for the
2-4 department, including a proper needs assessment that incorporates
2-5 information from local economic development entities;
2-6 (B) focuses activities based on the policy
2-7 directives of the governing board;
2-8 (C) details the methodology of how the
2-9 department plans to implement the strategies in the strategic plan;
2-10 and
2-11 (D) explains how individual division actions
2-12 contribute to the department's desired results;
2-13 (2) establishment of subcommittees relating to the key
2-14 administrative and programmatic functions of the department to
2-15 allow governing board members to develop the expertise necessary to
2-16 make informed decisions about and ensure accountability to the
2-17 department and its programs;
2-18 (3) establishment of effective, department-wide
2-19 contracting standards and methodologies;
2-20 (4) effective development and implementation of
2-21 consistent, department-wide policies, procedures, and controls over
2-22 daily operations, including budgeting, contracting, and travel;
2-23 (5) effective development and implementation of a
2-24 centralized information and accounting system that will provide
2-25 single management reports for key areas so that management can
2-26 determine a true financial position of the department; and
2-27 (6) effective use of the department's internal audit
3-1 function that ensures management responses to internal audit
3-2 reports are actually implemented.
3-3 (b) The department shall report to the Sunset Advisory
3-4 Commission by September 1, 2002, on the status of the criteria set
3-5 out in Subsection (a) as part of the reevaluation of the
3-6 department.
3-7 (c) This section expires September 1, 2003.
3-8 SECTION 1.04. Section 481.004, Government Code, is amended
3-9 to read as follows:
3-10 Sec. 481.004. GOVERNING BOARD. (a) The governing board is
3-11 composed of nine public members appointed by the governor with the
3-12 advice and consent of the senate, which members shall be appointed
3-13 to give geographical representation on the governing board to all
3-14 regions of the state.
3-15 (b) Members of the governing board serve for six-year terms
3-16 with the terms of three members expiring February 1 of each
3-17 odd-numbered year.
3-18 (c) Appointments to the governing board shall be made
3-19 without regard to the race, color, handicap, sex, religion, age, or
3-20 national origin of the appointees.
3-21 (d) In making appointments under this section, the governor
3-22 shall attempt to include members of different minority groups
3-23 including females, African Americans, Hispanic Americans, Native
3-24 Americans, Asian Americans, and persons who are disabled.
3-25 [(e) At least one member of the governing board must be a
3-26 resident of a county with a population of less than 30,000, at
3-27 least one other member must have experience in international trade,
4-1 at least one other member must have experience in tourism, and at
4-2 least one other member must be an economic development
4-3 practitioner.]
4-4 SECTION 1.05. Section 481.0041(c), Government Code, is
4-5 amended to read as follows:
4-6 (c) If the executive director has knowledge that a potential
4-7 ground for removal exists, the executive director shall notify the
4-8 presiding officer of the governing board of the ground. The
4-9 presiding officer shall then notify the governor that a potential
4-10 ground for removal exists. If the potential ground for removal
4-11 involves the presiding officer, the executive director shall notify
4-12 the next highest ranking officer of the governing board, who shall
4-13 then notify the governor and the attorney general that a potential
4-14 ground for removal exists.
4-15 SECTION 1.06. Section 481.0044, Government Code, is amended
4-16 by adding Subsection (e) to read as follows:
4-17 (e) The governing board shall develop and implement policies
4-18 that clearly separate the policymaking responsibilities of the
4-19 governing board and the management responsibilities of the
4-20 executive director and staff of the department.
4-21 SECTION 1.07. Subchapter A, Chapter 481, Government Code, is
4-22 amended by adding Section 481.0045 to read as follows:
4-23 Sec. 481.0045. TRAINING. (a) A person who is appointed to
4-24 and qualifies for office as a member of the governing board may not
4-25 vote, deliberate, or be counted as a member in attendance at a
4-26 meeting of the governing board until the person completes a
4-27 training program that complies with this section.
5-1 (b) The training program must provide the person with
5-2 information regarding:
5-3 (1) the legislation that created the department and
5-4 the governing board;
5-5 (2) the programs operated by the department;
5-6 (3) the role and functions of the department;
5-7 (4) the rules of the department with an emphasis on
5-8 the rules that relate to disciplinary and investigatory authority;
5-9 (5) the current budget for the department;
5-10 (6) the results of the most recent formal audit of the
5-11 department;
5-12 (7) the requirements of:
5-13 (A) the open meetings law, Chapter 551;
5-14 (B) the public information law, Chapter 552;
5-15 (C) the administrative procedure law, Chapter
5-16 2001; and
5-17 (D) other laws relating to public officials,
5-18 including conflict-of-interest laws; and
5-19 (8) any applicable ethics policies adopted by the
5-20 department or the Texas Ethics Commission.
5-21 (c) A person appointed to the governing board is entitled to
5-22 reimbursement, as provided by the General Appropriations Act, for
5-23 the travel expenses incurred in attending the training program
5-24 regardless of whether the attendance at the program occurs before
5-25 or after the person qualifies for office.
5-26 SECTION 1.08. Section 481.0066, Government Code, is amended
5-27 by adding Subsection (i) to read as follows:
6-1 (i) In carrying out its duties, the commission may not
6-2 deliberate the purchase, exchange, lease, or value of real
6-3 property, deliberate the appointment, employment, evaluation,
6-4 reassignment, duties, discipline, or dismissal of an officer or
6-5 employee of the department, or hear a complaint or charge against
6-6 an officer or employee of the department.
6-7 SECTION 1.09. Section 481.007, Government Code, is amended to
6-8 read as follows:
6-9 Sec. 481.007. ADVISORY COMMITTEES. (a) The executive
6-10 director or the governing board may appoint advisory committees to
6-11 assist the executive director or the governing board in the
6-12 performance of their duties. A member of an advisory committee
6-13 appointed by the executive director or the governing board may not
6-14 receive compensation for service on the advisory committee. A
6-15 member appointed under this section is entitled to receive
6-16 reimbursement, subject to any applicable limitation on
6-17 reimbursement provided by the General Appropriations Act, for
6-18 actual and necessary expenses included in performing service as a
6-19 member of the advisory committee.
6-20 (b) An advisory committee:
6-21 (1) must provide independent, external expertise on
6-22 department functions;
6-23 (2) may not be involved in setting department policy
6-24 or managing the department's actual operations; and
6-25 (3) may not include a board member as a member of the
6-26 advisory committee.
6-27 SECTION 1.10. Section 481.010, Government Code, is amended by
7-1 adding Subsection (i) to read as follows:
7-2 (i) The executive director or the executive director's
7-3 designee shall provide to department employees information and
7-4 training on the benefits and methods of participation in the state
7-5 employee incentive program.
7-6 SECTION 1.11. Section 481.012, Government Code, is amended by
7-7 amending Subsection (b), adding a new Subsection (c), and
7-8 redesignating current Subsections (c) and (d) as Subsections (d)
7-9 and (e), respectively, to read as follows:
7-10 (b) The department shall keep an information file about each
7-11 complaint filed with the department that the department has
7-12 authority to resolve. If a written complaint is filed with the
7-13 department that the department has authority to resolve, the
7-14 department, at least quarterly and until final disposition of the
7-15 complaint, shall notify the parties to the complaint of the status
7-16 of the complaint unless the notice would jeopardize an undercover
7-17 investigation. The file must include:
7-18 (1) the name of the person who filed the complaint;
7-19 (2) the date the complaint is received by the
7-20 department;
7-21 (3) the subject matter of the complaint;
7-22 (4) the name of each person contacted in relation to
7-23 the complaint;
7-24 (5) a summary of the results of the review or
7-25 investigation of the complaint; and
7-26 (6) an explanation of the reason the file was closed,
7-27 if the department closed the file without taking action other than
8-1 to investigate the complaint.
8-2 (c) The department shall provide to the person filing the
8-3 complaint and to each person who is a subject of the complaint a
8-4 copy of the department's policies and procedures relating to
8-5 complaint investigation and resolution.
8-6 (d) [(c)] The governing board shall prepare and maintain a
8-7 written plan that describes how a person who does not speak English
8-8 can be provided reasonable access to the department's programs. The
8-9 governing board shall also comply with federal and state laws for
8-10 program and facility accessibility.
8-11 (e) [(d)] The governing board by rule shall establish
8-12 methods by which consumers and service recipients are notified of
8-13 the name, mailing address, and telephone number of the department
8-14 for the purpose of directing complaints to the department.
8-15 SECTION 1.12. Section 481.021(c), Government Code, is amended
8-16 to read as follows:
8-17 (c) The department shall deposit contributions from private
8-18 sources in a separate fund kept and held in escrow and in trust by
8-19 the comptroller for and on behalf of the department as funds held
8-20 outside the treasury under Section 404.073, and the money
8-21 contributed shall be used to carry out the purposes of the
8-22 department and, to the extent possible, the purposes specified by
8-23 the donors. The comptroller may invest and reinvest the money,
8-24 pending its use, in the fund in investments authorized by law for
8-25 state funds that the comptroller considers appropriate. The
8-26 department shall adopt rules that:
8-27 (1) require the department to account for all general
9-1 revenue money contributed to projects supported by money held
9-2 outside the treasury and provide that the department shall be fully
9-3 reimbursed for those contributions as money becomes available; and
9-4 (2) require the department to account for all staff
9-5 time spent on fund-raising activities associated with private
9-6 donations.
9-7 SECTION 1.13. Subchapter L, Chapter 481, Government Code, is
9-8 amended by adding Sections 481.175, 481.176, and 481.177 to read as
9-9 follows:
9-10 Sec. 481.175. TEXAS TOURISM COORDINATING COUNCIL. (a) The
9-11 Texas Tourism Coordinating Council consists of one representative
9-12 from each of the following:
9-13 (1) the department;
9-14 (2) the Texas Department of Transportation;
9-15 (3) the Parks and Wildlife Department;
9-16 (4) the Texas Commission on the Arts;
9-17 (5) the Texas Historical Commission;
9-18 (6) the General Land Office;
9-19 (7) the Texas Department of Public Safety;
9-20 (8) the Department of Agriculture;
9-21 (9) Texas A&M University;
9-22 (10) the Music, Film, Television, and Multimedia
9-23 Office; and
9-24 (11) the State Preservation Board.
9-25 (b) The council shall designate a presiding officer from
9-26 among its members.
9-27 (c) The council shall receive administrative support from
10-1 the entities the members represent.
10-2 (d) The council members shall develop, maintain, and enter
10-3 into a memorandum of understanding for the administration of this
10-4 subchapter.
10-5 Sec. 481.176. MEETINGS. (a) The council shall meet as often
10-6 as necessary to perform its duties.
10-7 (b) Eight members of the council, including the presiding
10-8 officer, constitute a quorum. If a quorum is present, the council
10-9 may act on any matter that is within its jurisdiction by a majority
10-10 vote.
10-11 (c) The council shall keep complete minutes of each meeting.
10-12 Sec. 481.177. POWERS AND DUTIES. The council shall:
10-13 (1) analyze tourism functions of various state
10-14 agencies;
10-15 (2) identify and address tourism coordination
10-16 problems;
10-17 (3) ensure that council members comply with the
10-18 required memorandum of understanding;
10-19 (4) implement a coordinated marketing plan;
10-20 (5) work with the department's Tourism Advisory
10-21 Committee, as necessary, to ensure comment and recommendations from
10-22 the other state agencies responsible for specific tourism areas
10-23 such as recreational, nature, heritage, and cultural tourism; and
10-24 (6) report to the legislature biennially on all
10-25 agencies' progress and actions taken to coordinate tourism efforts
10-26 in this state, including the state resources dedicated to and the
10-27 outcomes of recreational, cultural, historical, nature, and other
11-1 types of tourism.
11-2 SECTION 1.14. (a) The Texas Economic Development Corporation
11-3 is abolished. Section 481.024, Government Code, is repealed.
11-4 (b) The Texas Department of Economic Development shall adopt
11-5 the rules required by Section 481.021(c), Government Code, as
11-6 amended by this Act, on or before December 1, 2001.
11-7 ARTICLE 2. FUNDING AND ADMINISTRATION OF SMART JOBS
11-8 FUND PROGRAM
11-9 SECTION 2.01. Subtitle B, Title 4, Labor Code, is amended by
11-10 adding Chapter 310 to read as follows:
11-11 CHAPTER 310. SMART JOBS FUND PROGRAM
11-12 Sec. 310.001. DEFINITIONS. In this chapter:
11-13 (1) "Commission" means the Texas Workforce Commission.
11-14 (2) "County average weekly wage" means the average
11-15 weekly wage paid by all employers in a county that are covered by
11-16 unemployment compensation insurance, as determined by the
11-17 commission for the most recent period for which data is available.
11-18 (3) "Division" means the division of workforce
11-19 development at the commission.
11-20 (4) "Employee" means an individual who performs
11-21 services for another under a contract of hire, whether express or
11-22 implied, or oral or written.
11-23 (5) "Employer" means a person that employs one or more
11-24 employees.
11-25 (6) "Executive director" means the executive director
11-26 of the commission.
11-27 (7) "Existing employer" means an employer that:
12-1 (A) has been liable to pay contributions under
12-2 Subtitle A for more than one year;
12-3 (B) has employees; and
12-4 (C) is in compliance with the reporting and
12-5 payment requirements of Subtitle A, as determined by the
12-6 commission.
12-7 (8) "Group health benefit plan" means:
12-8 (A) a health plan provided by a health
12-9 maintenance organization established under the Texas Health
12-10 Maintenance Organization Act (Chapter 20A, Vernon's Texas Insurance
12-11 Code);
12-12 (B) a health benefit plan approved by the
12-13 commissioner of insurance; or
12-14 (C) a self-funded or self-insured employee
12-15 welfare benefit plan that provides health benefits and is
12-16 established in accordance with the Employee Retirement Income
12-17 Security Act of 1974 (29 U.S.C. Section 1001 et seq.), as amended.
12-18 (9) "In-kind contribution" means a noncash
12-19 contribution of goods and services provided by an employer as all
12-20 or part of the employer's matching share of a grant or project.
12-21 (10) "Job" means employment on a basis customarily
12-22 considered full-time for the applicable occupation and industry.
12-23 (11) "Large business" means a business entity that
12-24 employs at least 500 employees.
12-25 (12) "Medium business" means a business entity that
12-26 employs more than 99 but fewer than 500 employees.
12-27 (13) "Micro-business" means a business entity that
13-1 employs not more than 20 employees.
13-2 (14) "Minority employer" means a business entity at
13-3 least 51 percent of which is owned by minority group members or, in
13-4 the case of a corporation, at least 51 percent of the shares of
13-5 which are owned by minority group members and that:
13-6 (A) is managed and, in daily operations, is
13-7 controlled by minority group members; and
13-8 (B) is a domestic business entity with a home or
13-9 branch office located in this state and is not a branch or
13-10 subsidiary of a foreign corporation or other foreign business
13-11 entity.
13-12 (15) "Minority group members" include:
13-13 (A) African Americans;
13-14 (B) American Indians;
13-15 (C) Asian Americans;
13-16 (D) Mexican Americans and other Americans of
13-17 Hispanic origin; and
13-18 (E) women.
13-19 (16) "Program" means the smart jobs fund program
13-20 created under this chapter.
13-21 (17) "Project" means a specific employment training
13-22 project developed and implemented under this chapter.
13-23 (18) "Provider" means a person that provides
13-24 employment-related training. The term includes employers, employer
13-25 associations, labor organizations, community-based organizations,
13-26 training consultants, public and private schools, technical
13-27 institutes, junior or community colleges, senior colleges,
14-1 universities, and proprietary schools, as defined by Section
14-2 132.001, Education Code.
14-3 (19) "Qualified job" means a job for which an
14-4 application has been submitted and that:
14-5 (A) pays at least 100 percent of the county
14-6 average weekly wage; and
14-7 (B) is covered by a group health benefit plan
14-8 for which the business offers to pay at least 50 percent of the
14-9 premiums or other charges assessed for employee-only coverage under
14-10 the plan, regardless of whether an employee may voluntarily waive
14-11 the coverage.
14-12 (20) "Small business" means a business entity that
14-13 employs more than 20 but fewer than 100 employees.
14-14 (21) "Trainee" means a participant in a project funded
14-15 under this chapter.
14-16 (22) "Wages" means all forms of compensation or
14-17 remuneration, excluding benefits, payable for a specific period to
14-18 an employee for personal services rendered by that employee.
14-19 Sec. 310.002. SMART JOBS FUND PROGRAM; PURPOSE;
14-20 ADMINISTRATION. (a) The smart jobs fund program is created in the
14-21 division as a workforce development incentive program to enhance
14-22 employment opportunities for residents of this state and to
14-23 increase the job skills of the existing workforce by providing job
14-24 training assistance to businesses operating in, or relocating to,
14-25 this state.
14-26 (b) The program shall award grants for the creation and
14-27 retention of qualified jobs. At least 60 percent of the money
15-1 spent under the program shall be used for projects that assist
15-2 existing employers. At least 20 percent shall be used for
15-3 employers that relocate operations to this state.
15-4 (c) The commission by rule shall develop and adopt a scoring
15-5 system that evaluates the economic impact of grant applications and
15-6 reflects the criteria set forth in this chapter. The executive
15-7 director shall use the scoring system and a competitive process to
15-8 award grants. It is the intent of the legislature that, to the
15-9 greatest extent practicable:
15-10 (1) money from the smart jobs fund be spent:
15-11 (A) in all areas of this state; and
15-12 (B) in approximate proportion to each region's
15-13 share of the state's population, civilian labor force, unemployed,
15-14 and submission of grant applications for qualified jobs; and
15-15 (2) grants shall be awarded to micro-businesses, small
15-16 businesses, medium businesses, large businesses, and minority
15-17 employers in a manner proportionate to the number of persons
15-18 employed by those categories of businesses.
15-19 (d) The commission shall determine appropriate means to
15-20 accomplish the goals of the program. As necessary to implement
15-21 those goals, the commission may work in conjunction with the
15-22 comptroller.
15-23 (e) The division shall administer the program.
15-24 (f) The executive director may employ personnel as necessary
15-25 to administer the program.
15-26 (g) In implementing provisions under this chapter regarding
15-27 the classification of this state into regions, the division shall
16-1 use the uniform service regions established by the comptroller
16-2 under Section 120, Article V, Chapter 19, Acts of the 72nd
16-3 Legislature, 1st Called Session, 1991 (the General Appropriations
16-4 Act).
16-5 Sec. 310.003. RULES. The commission shall adopt rules as
16-6 necessary to implement the program.
16-7 Sec. 310.004. FUNDING; RAINY DAY FUND. (a) The smart jobs
16-8 fund is established as a special trust fund in the custody of the
16-9 comptroller separate and apart from all public money or funds of
16-10 this state. The fund is composed of:
16-11 (1) money transferred into the fund under Section
16-12 204.123;
16-13 (2) gifts, grants, and other donations received by the
16-14 division for the fund; and
16-15 (3) any amounts appropriated by the legislature for
16-16 the program from the general revenue fund.
16-17 (b) The program is funded through the smart jobs fund.
16-18 (c) Money in the smart jobs fund may be used for program
16-19 administration, marketing expenses, and evaluation of the program.
16-20 These costs of the division in any fiscal year may not exceed the
16-21 lesser of:
16-22 (1) five percent of the total amount appropriated for
16-23 the program for that fiscal year; or
16-24 (2) $1.5 million.
16-25 (d) The smart jobs rainy day fund is established as a
16-26 special trust fund in the custody of the comptroller separate and
16-27 apart from all public money or funds of this state. The smart jobs
17-1 rainy day fund is composed of:
17-2 (1) money transferred to that fund as provided by
17-3 Section 204.123;
17-4 (2) money returned by employers or recouped by the
17-5 program under Section 310.011(d); and
17-6 (3) any other money received by the division for
17-7 deposit in that fund.
17-8 (e) The commission may authorize the executive director to
17-9 use money in the smart jobs rainy day fund if:
17-10 (1) the commission determines, after consulting with
17-11 the comptroller, that the smart jobs fund contains insufficient
17-12 money to cover the amounts appropriated by the legislature to
17-13 operate the program; and
17-14 (2) the commission has determined that:
17-15 (A) the unemployment rate in this state is 125
17-16 percent of the average unemployment rate in this state during the
17-17 preceding three years; or
17-18 (B) a severe economic dislocation is occurring
17-19 in a specific region of this state.
17-20 (f) The commission by rule shall define "severe economic
17-21 dislocation" for purposes of Subsection (e). In adopting a
17-22 definition, the commission shall consider employment-related
17-23 factors, including:
17-24 (1) massive layoffs in a region of this state caused
17-25 by:
17-26 (A) the closure of military bases;
17-27 (B) the effect of the implementation of the
18-1 North American Free Trade Agreement;
18-2 (C) employer relocations; or
18-3 (D) other analogous situations; and
18-4 (2) the number of jobs lost in a region compared to
18-5 the region's usual rates of employment.
18-6 (g) If the commission approves the use of money from the
18-7 smart jobs rainy day fund because of a severe economic dislocation
18-8 occurring in a specific region of the state, the executive director
18-9 may use the money allocated from the smart jobs rainy day fund
18-10 solely for projects located in the affected region.
18-11 (h) Notwithstanding any other provision of this section, the
18-12 total combined amount spent in any fiscal year from the smart jobs
18-13 fund and the smart jobs rainy day fund may not exceed the amount
18-14 appropriated by the legislature for that fiscal year for the
18-15 operation of the program.
18-16 (i) If, during any three consecutive months, the balance in
18-17 the smart jobs fund or the smart jobs rainy day fund exceeds 0.15
18-18 percent of the total taxable wages for the four calendar quarters
18-19 ending the preceding June 30, as computed under Section 204.062(c),
18-20 the executive director shall immediately transfer the excess from
18-21 the applicable fund to the unemployment compensation fund created
18-22 under Section 203.021.
18-23 Sec. 310.005. DESIGNATION OF PROGRAM FUNDS FOR ECONOMIC
18-24 DEVELOPMENT. A percentage of money in the smart jobs fund
18-25 determined by the General Appropriations Act shall be transferred
18-26 to the Texas Department of Economic Development for the purpose of
18-27 attracting businesses for economic development through the use of
19-1 the program. The department shall determine the qualified
19-2 recipients of the money for the purpose of attracting businesses to
19-3 the state in accordance with commission rules and requirements for
19-4 smart jobs grants. The resulting smart jobs grants are exempt from
19-5 Section 310.002(c) and administered by the division.
19-6 Sec. 310.006. GRANTS. (a) The executive director may award
19-7 grants for projects that meet the requirements of this chapter.
19-8 (b) A grant may not be awarded unless each employer
19-9 participating in the project certifies that:
19-10 (1) a job or job opening exists or will exist at the
19-11 end of the project for which the grant is sought; and
19-12 (2) the job or job opening will be filled by a
19-13 participant in the project.
19-14 (c) Except as otherwise provided by this subsection, a grant
19-15 may not be awarded unless each employer participating in the
19-16 project certifies that each job under the project is covered by a
19-17 group health benefit plan for which the business pays at least 50
19-18 percent of the premiums or other charges assessed for employee-only
19-19 coverage under the plan. The executive director may waive the
19-20 coverage requirement for a particular job if the affected employee
19-21 voluntarily waives the coverage in the manner prescribed by rules
19-22 adopted by the commission.
19-23 (d) A grant may not be awarded for a project under this
19-24 section unless each employer participating in the project certifies
19-25 that the starting wage for a new job created through the project
19-26 will be equal to or greater than the county average weekly wage for
19-27 the county in which the job or project is located and that the wage
20-1 for a job existing on the date that the project is scheduled to
20-2 begin will be increased to the greater of:
20-3 (1) three percent for a micro-business or small
20-4 business or five percent for a business that is not a
20-5 micro-business or small business over the wage in effect on the day
20-6 before the date on which the project is scheduled to begin for that
20-7 job; or
20-8 (2) 100 percent of the county average weekly wage for
20-9 the county in which the job or project is located.
20-10 (e) An employer may apply for a grant under this chapter.
20-11 An employer may request a modification of the requirements provided
20-12 by Subsection (d) and Section 310.009, if reasonable factors exist
20-13 for the modification, as determined by the executive director.
20-14 (f) Grants awarded under this section for which the
20-15 executive director has modified the requirements of Subsection (d)
20-16 may not, in any fiscal year, exceed 10 percent of the total dollar
20-17 amount of grants awarded under the program in that year.
20-18 (g) Unless modified by the executive director under rules
20-19 adopted by the commission, a grant may not be awarded for a project
20-20 unless each employer participating in the project certifies that it
20-21 will continue to spend on nonmanagerial training an amount from
20-22 private sources equal to the average amount spent by that employer
20-23 on such training for the most recent two-year period.
20-24 (h) A grant may not be awarded for a project if the project
20-25 will impair existing contracts for services or collective
20-26 bargaining agreements, except that a project inconsistent with the
20-27 terms of a collective bargaining agreement may be undertaken with
21-1 the written concurrence of the collective bargaining unit and the
21-2 employer or employers who are parties to the agreement.
21-3 Sec. 310.007. GRANT APPLICATION; AWARDING OF GRANTS. (a)
21-4 The following may apply for a grant under this chapter:
21-5 (1) one or more employers to secure training;
21-6 (2) one or more employers acting in partnership with
21-7 an employer organization, labor organization, or community-based
21-8 organization to secure training; or
21-9 (3) one or more employers acting in partnership with a
21-10 consortium composed of more than one provider to secure training.
21-11 (b) A grant application must be filed with the division in a
21-12 form approved by the executive director and, except as provided by
21-13 Subsection (c), must include a complete business and training plan,
21-14 including:
21-15 (1) the number and kind of jobs available;
21-16 (2) the skills and competencies required for the
21-17 identified jobs;
21-18 (3) the wages to be paid to trainees on successful
21-19 completion of the project;
21-20 (4) the goals, objectives, and outcome measures for
21-21 the project;
21-22 (5) the proposed curriculum for the project; and
21-23 (6) the projected cost per person enrolled, trained,
21-24 hired, and retained in employment.
21-25 (c) The commission by rule may exempt a micro-business from
21-26 the requirement to submit a business and training plan that
21-27 complies with Subsection (b). The commission by rule shall
22-1 establish a simplified application process for grant applications
22-2 from micro-businesses.
22-3 (d) The division may provide assistance with the application
22-4 process to all applicants and shall give priority to assisting
22-5 applicants who are small businesses or micro-businesses.
22-6 (e) The division shall minimize the length of the
22-7 application form and shall simplify as much as possible the review
22-8 process for grant applications.
22-9 (f) The division shall notify each applicant as to whether
22-10 the application is complete not later than the fifth business day
22-11 after the date on which the application is received by the
22-12 division.
22-13 Sec. 310.008. PARTICIPATION IN ADDITIONAL PROGRAMS;
22-14 APPLICATION REQUIREMENTS. (a) A business may not apply both for a
22-15 grant under this chapter and to a public community or technical
22-16 college for customized training and assessment from the college
22-17 through a grant issued to the college under the skills development
22-18 fund program established under Chapter 303 unless the business and
22-19 the college file an application for concurrent participation in
22-20 both programs.
22-21 (b) The commission by rule shall establish the requirements
22-22 for an application subject to this section.
22-23 Sec. 310.009. MATCHING REQUIREMENTS; EXEMPTIONS. (a) Money
22-24 provided under a grant for a project must be matched by private
22-25 funds provided by the employer benefiting from the project in an
22-26 amount at least equal to the amount provided by the grant.
22-27 (b) The commission may adopt rules modifying the
23-1 requirements of Subsection (a) for employers that are small
23-2 businesses or micro-businesses and may also adopt rules modifying
23-3 the requirements of Subsection (a) for projects that provide
23-4 significant economic benefits to an entire region of the state.
23-5 (c) Employer matches may include documented in-kind
23-6 contributions as well as wages paid to trainees during the training
23-7 period.
23-8 Sec. 310.010. TRAINEES. The program shall give priority to
23-9 residents of this state, including residents formerly sentenced to
23-10 the institutional division or the state jail division of the Texas
23-11 Department of Criminal Justice.
23-12 Sec. 310.011. CONTRACTS. (a) The executive director may
23-13 approve any project that meets the requirements of this chapter.
23-14 If a project is approved and funds are available, the division
23-15 shall enter into a contract with the grant applicant and with each
23-16 employer participating in the project. The contract must specify
23-17 those skills and competencies to be gained as a result of the
23-18 project.
23-19 (b) Reimbursable costs in the contract may include only
23-20 those expenses related to direct training in job-related basic
23-21 skills, including literacy skills, job-related vocational skills,
23-22 and administrative costs. Total administrative costs for any
23-23 particular project may not exceed 10 percent of the project's
23-24 expenditures.
23-25 (c) Each contract must provide a schedule for payment of
23-26 smart jobs fund money. Twenty-five percent of allowable
23-27 expenditures shall be withheld by the division for 90 days after
24-1 the date of completion of the contract. If at least 85 percent of
24-2 the trainees in the project have been retained in employment for
24-3 that 90-day period, other than trainees who leave the employment
24-4 voluntarily for better-paying jobs, and have successfully achieved
24-5 the skills and competencies, wage requirements, and other
24-6 contractual obligations, the amount of allowable expenditures
24-7 withheld shall be remitted to the employer. The commission by rule
24-8 shall establish procedures as necessary to verify that a trainee
24-9 has left the employment for a better-paying job. If there is a
24-10 negative balance, the employer is liable for the amount of the
24-11 negative balance and shall remit that amount to the division not
24-12 later than the 30th day after the date on which the employer is
24-13 notified of the negative balance by the division.
24-14 (d) Each contract must state the term of the grant award. A
24-15 grant recipient who does not use all money awarded under the grant
24-16 for the prescribed purpose within the allotted term shall reimburse
24-17 the program by submitting the appropriate amount to the executive
24-18 director not later than the 30th day after the expiration date of
24-19 the term of the grant award. The executive director shall remit
24-20 money received under this subsection to the comptroller for deposit
24-21 in the smart jobs rainy day fund.
24-22 Sec. 310.012. SMART JOBS PROGRAM CONTRACT PROVISIONS. The
24-23 commission shall by rule require each smart jobs contract to have:
24-24 (1) clearly defined goals, outputs, and measurable
24-25 outcomes that directly relate to program objectives;
24-26 (2) clearly defined sanctions for noncompliance with
24-27 contract terms; and
25-1 (3) clearly specified accounting, reporting, and
25-2 auditing requirements for funds received under program contracts.
25-3 Sec. 310.013. SMART JOBS PROGRAM MONITORING PRACTICES. The
25-4 commission by rule shall adopt program monitoring practices that
25-5 include:
25-6 (1) risk-assessment to determine which contracts have
25-7 the highest risk for fraud and abuse; and
25-8 (2) a method to obtain and evaluate program cost
25-9 information to ensure all costs, including administrative costs,
25-10 are reasonable and necessary to achieve program objectives.
25-11 Sec. 310.014. ANNUAL REPORT. (a) The commission shall
25-12 report to the governor and the legislature at the end of each
25-13 fiscal year on the status of the program.
25-14 (b) The annual report must include for that fiscal year:
25-15 (1) the total number of applications submitted, the
25-16 total number of applications approved, and the total number of
25-17 applications rejected, reported by region of the state and by size
25-18 of business;
25-19 (2) the number of employers receiving grants under the
25-20 program reported by region of the state and the percentage that
25-21 number represents of the total number of employers receiving grants
25-22 under the program on a statewide basis;
25-23 (3) the total amount of money awarded in each region
25-24 of the state and the percentage that amount represents of the total
25-25 amount of money awarded on a statewide basis;
25-26 (4) a comparison of the percentage of total dollars
25-27 awarded to each region versus each region's percentage of:
26-1 (A) the state's population;
26-2 (B) the civilian labor force;
26-3 (C) the number of unemployed persons; and
26-4 (D) the number of eligible grant applications
26-5 for qualified jobs submitted to the division;
26-6 (5) the value, expressed in dollars and as a
26-7 percentage of total training expenditures, of matching
26-8 contributions made by employers;
26-9 (6) the number of businesses, classified by
26-10 micro-businesses, small businesses, medium businesses, and large
26-11 businesses, that receive grants under the program reported by
26-12 region of the state and business size and the percentage that
26-13 number represents of the total number of each of those categories
26-14 of businesses receiving grants under the program on a statewide
26-15 basis;
26-16 (7) the total amount of money awarded to
26-17 micro-businesses, small businesses, medium businesses, and large
26-18 businesses, reported by region of the state and business size, and
26-19 the percentage that amount represents of the total amount of money
26-20 awarded to those businesses on a statewide basis;
26-21 (8) the number of businesses located in enterprise
26-22 zones, as that term is defined by Chapter 2303, Government Code,
26-23 that receive grants under the program and the total amount of the
26-24 grants awarded to those businesses;
26-25 (9) the total number of jobs created, enhanced, or
26-26 retained under the program:
26-27 (A) by region of the state;
27-1 (B) by occupation, classified by the applicable
27-2 two-digit standard industrial classification;
27-3 (C) by wage level; and
27-4 (D) whether attributable to:
27-5 (i) relocation of businesses to this
27-6 state, including the percentage the number attributable to the
27-7 relocation of businesses represents of the total number of jobs
27-8 created, enhanced, or retained under the program on a statewide
27-9 basis; or
27-10 (ii) training or retraining of employees
27-11 of existing employers, including the percentage that the number
27-12 attributable to the training or retraining of employees of existing
27-13 employers represents of the total number of jobs created, enhanced,
27-14 or retained under the program on a statewide basis;
27-15 (10) the average and median weekly wage levels of
27-16 trainees entering or returning to the workforce, broken down by
27-17 current employees undergoing retraining and new hires, at three
27-18 months and one year after the conclusion of their training;
27-19 (11) the number and percentage of participating
27-20 employers that provide workers' compensation insurance coverage and
27-21 the number and percentage of employees covered;
27-22 (12) the number and percentage of employees covered by
27-23 the group health benefit plan offered by the employer;
27-24 (13) the number and percentage of women, disabled
27-25 persons, and minority group members receiving grants under the
27-26 program as employers, participating as trainees in training
27-27 projects, or participating in the program as providers, broken out
28-1 by group;
28-2 (14) a list of modifications granted under Section
28-3 310.006(e), the name of the project for which the modification was
28-4 granted, and the reason the executive director granted the
28-5 modification; and
28-6 (15) the number of trainees who have left employment
28-7 with a grant recipient because the trainee has obtained a
28-8 better-paying job, as verified under Section 310.011(c).
28-9 (c) In addition to the information required under Subsection
28-10 (b), the commission shall include in the annual report, for each
28-11 region of the state in which a grant is awarded, the percentage
28-12 paid by employers in that region of the total amount of
28-13 unemployment insurance contributions paid by employers during the
28-14 preceding calendar year.
28-15 SECTION 2.02. Section 19.011(a), Education Code, is amended
28-16 to read as follows:
28-17 (a) In order to achieve the goals stated in Section 19.003,
28-18 the district with the cooperation of the Health and Human Services
28-19 Commission, the Council on Workforce and Economic Competitiveness,
28-20 the division of workforce development at the Texas Workforce
28-21 Commission [Texas Department of Commerce], and the department shall
28-22 provide persons confined or imprisoned in the department:
28-23 (1) information from local workforce and development
28-24 boards on job training and employment referral services;
28-25 (2) information on the tax refund voucher program
28-26 under Subchapter H [D], Chapter 301 [31], Labor [Human Resources]
28-27 Code; and
29-1 (3) information on the smart jobs fund program under
29-2 Chapter 310, Labor Code.
29-3 SECTION 2.03. Section 403.351(a), Government Code, is amended
29-4 to read as follows:
29-5 (a) The comptroller shall perform a biennial performance
29-6 evaluation of:
29-7 (1) the smart jobs fund program established under
29-8 [Subchapter J,] Chapter 310, Labor Code [481]; and
29-9 (2) the skills development fund program established
29-10 under Chapter 303, Labor Code.
29-11 SECTION 2.04. Section 2308.308, Government Code, is amended
29-12 to read as follows:
29-13 Sec. 2308.308. PUBLIC COMMUNITY COLLEGE. A public community
29-14 college shall promptly provide workforce training and services that
29-15 are requested:
29-16 (1) by a board if the need for the training and
29-17 services is based on the labor market information system available
29-18 for the area;
29-19 (2) by employers located in the college's taxing
29-20 district when the request is presented directly to the college by
29-21 the employers or through the board; or
29-22 (3) as part of economic development incentives
29-23 designed to attract or retain an employer, including incentives
29-24 offered under the smart jobs fund program under [Subchapter J,]
29-25 Chapter 310, Labor Code [481].
29-26 SECTION 2.05. Section 204.123(a), Labor Code, is amended to
29-27 read as follows:
30-1 (a) If, on September 1 of a year, the commission determines
30-2 that the amount in the compensation fund will exceed 100 percent of
30-3 its floor as computed under Section 204.061 on the next October 1
30-4 computation date, the commission shall transfer from the holding
30-5 fund created under Section 204.122:
30-6 (1) 50 percent of the amount in the holding fund to
30-7 the smart jobs fund created under Section 310.004(a) [481.154(a),
30-8 Government Code];
30-9 (2) 30 percent of the amount in the holding fund to
30-10 the skills development fund created under Section 303.003; and
30-11 (3) 20 percent of the amount in the holding fund to
30-12 the smart jobs rainy day fund created under Section 310.004(d)
30-13 [481.154(d), Government Code].
30-14 SECTION 2.06. Section 302.021(a), Labor Code, is amended to
30-15 read as follows:
30-16 (a) The following job-training, employment, and
30-17 employment-related educational programs and functions are
30-18 consolidated under the authority of the division:
30-19 (1) adult education programs under Subchapter H,
30-20 Chapter 29, Education Code;
30-21 (2) proprietary school programs under Chapter 132,
30-22 Education Code;
30-23 (3) apprenticeship programs under Chapter 133,
30-24 Education Code;
30-25 (4) postsecondary vocational and technical
30-26 job-training programs that are not a part of approved courses or
30-27 programs that lead to licensing, certification, or an associate
31-1 degree under Chapters 61, 130, and 135, Education Code, Subchapter
31-2 E, Chapter 88, Education Code, and Subchapter E, Chapter 96,
31-3 Education Code;
31-4 (5) employment programs under Chapter 31, Human
31-5 Resources Code;
31-6 (6) the senior citizens employment program under
31-7 Chapter 101, Human Resources Code;
31-8 (7) the work and family policies program under Chapter
31-9 81;
31-10 (8) job-training programs funded under the Job
31-11 Training Partnership Act (29 U.S.C. Section 1501 et seq.) and under
31-12 the Workforce Investment Act of 1998 (29 U.S.C. Section 2801 et
31-13 seq.);
31-14 (9) the job counseling program for displaced
31-15 homemakers under Chapter 304;
31-16 (10) the reintegration of offenders program under
31-17 Chapter 306;
31-18 (11) the smart jobs fund program under Chapter 310
31-19 [the inmate employment counseling program under Section 499.051(f),
31-20 Government Code];
31-21 (12) the continuity of care program under Section
31-22 501.095, Government Code;
31-23 (13) a literacy program from state, local, federal,
31-24 and private funds available to the state for that purpose;
31-25 (14) the employment service;
31-26 (15) the community service program under the National
31-27 and Community Service Act of 1990 (42 U.S.C. Section 12501 et
32-1 seq.);
32-2 (16) the trade adjustment assistance program under
32-3 Part 2, Subchapter II, Trade Act of 1974 (19 U.S.C. Section 2271 et
32-4 seq.);
32-5 (17) education, employment, employment support,
32-6 training services, activities and programs funded under Temporary
32-7 Assistance for Needy Families (42 U.S.C. Section 601 et seq.);
32-8 (18) the food stamp employment and training program
32-9 authorized under 7 U.S.C. Section 2015(d); and
32-10 (19) the functions of the State Occupational
32-11 Information Coordinating Committee.
32-12 SECTION 2.07. Section 303.005, Labor Code, is amended to read
32-13 as follows:
32-14 Sec. 303.005. PARTICIPATION IN ADDITIONAL PROGRAMS;
32-15 APPLICATION REQUIREMENTS. An employer may not apply both to a
32-16 public community or technical college for customized training and
32-17 assessment from the college through a grant issued to the college
32-18 under the skills development fund program established under this
32-19 chapter and for a grant under the smart jobs fund program
32-20 established under [Subchapter J,] Chapter 310 [481, Government
32-21 Code,] unless the employer and the college file an application for
32-22 concurrent participation in both programs that complies with
32-23 Section 310.008 [481.1565, Government Code].
32-24 SECTION 2.08. Section 306.007(a), Labor Code, is amended to
32-25 read as follows:
32-26 (a) To assist in the reintegration into the labor force of
32-27 persons formerly sentenced to the institutional division or the
33-1 state jail division, the commission through Project RIO shall
33-2 provide:
33-3 (1) to those persons:
33-4 (A) information from local workforce development
33-5 boards on job training and employment referral services;
33-6 (B) information from the Texas Commission on
33-7 Alcohol and Drug Abuse on substance abuse treatment services;
33-8 (C) information from the Texas Department of
33-9 Housing and Community Affairs on housing services;
33-10 (D) information from the Texas Veterans
33-11 Commission on services for veterans; and
33-12 (E) information from the Texas Department of
33-13 Human Services on tax refund voucher programs under Subchapter D,
33-14 Chapter 31, Human Resources Code; and
33-15 (2) to the employers and potential employers of those
33-16 persons:
33-17 (A) information from the Texas Department of
33-18 Economic Development [Commerce] on the enterprise zone program;
33-19 (B) information from the division of workforce
33-20 development at the Texas Workforce Commission on the [and] smart
33-21 jobs fund program; and
33-22 (C) [(B)] information from local workforce
33-23 development boards on services listed in Section 2308.304,
33-24 Government Code.
33-25 SECTION 2.09. Subchapter J, Chapter 481, Government Code, is
33-26 repealed.
33-27 SECTION 2.10. (a) On the effective date of this Act, all
34-1 powers, duties, obligations, rights, contracts, records, employees,
34-2 property, and unspent and unobligated appropriations and other
34-3 funds of the Texas Department of Economic Development that are used
34-4 by that agency on the effective date of this Act to administer the
34-5 smart jobs fund program are transferred to the Texas Workforce
34-6 Commission.
34-7 (b) All rules, policies, procedures, and decisions that
34-8 affect the smart jobs fund program are continued in effect until
34-9 superseded by a rule or other appropriate action of the Texas
34-10 Workforce Commission.
34-11 (c) Any action or proceeding before the Texas Department of
34-12 Economic Development relating to the smart jobs fund program is
34-13 transferred without change in status to the Texas Workforce
34-14 Commission, and the Texas Workforce Commission assumes, without
34-15 change in status, the position of the Texas Department of Economic
34-16 Development in any action or proceeding relating to the smart jobs
34-17 fund program to which the Texas Department of Economic Development
34-18 is a party.
34-19 (d) The smart jobs fund program established under Subchapter
34-20 J, Chapter 481, Government Code, is abolished on the effective date
34-21 of this Act. The Texas Department of Economic Development may not
34-22 award a grant under that program on or after that date. All
34-23 unobligated and unexpended balances in the smart jobs fund created
34-24 under Section 481.154, Government Code, as that section existed
34-25 before repeal by this Act, are transferred on the effective date of
34-26 this Act to the smart jobs fund created under Section 310.004,
34-27 Labor Code, as added by this Act.
35-1 (e) The Texas Workforce Commission shall adopt rules to
35-2 implement Chapter 310, Labor Code, as added by this Act, not later
35-3 than December 31, 2001.
35-4 ARTICLE 3. EFFECTIVE DATE
35-5 SECTION 3.01. This Act takes effect September 1, 2001.