1-1     By:  Ellis                                            S.B. No. 1190
 1-2           (In the Senate - Filed March 6, 2001; March 8, 2001, read
 1-3     first time and referred to Committee on Education; April 9, 2001,
 1-4     reported favorably by the following vote:  Yeas 8, Nays 0;
 1-5     April 9, 2001, sent to printer.)
 1-6                            A BILL TO BE ENTITLED
 1-7                                   AN ACT
 1-8     relating to technology development and transfer by institutions of
 1-9     higher education.
1-10           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11           SECTION 1.  Subtitle H, Title 3, Education Code, is amended
1-12     by adding Chapter 153 to read as follows:
1-13        CHAPTER 153.  CENTERS FOR TECHNOLOGY DEVELOPMENT AND TRANSFER
1-14           Sec. 153.001.  DEFINITIONS.  In this chapter:
1-15                 (1)  "Center" means an office, department, or other
1-16     organizational unit established under this chapter.
1-17                 (2)  "Governing board" has the meaning assigned by
1-18     Section 61.003.
1-19                 (3)  "Institution of higher education" has the meaning
1-20     assigned by Section 61.003.
1-21                 (4)  "Organization" has the meaning assigned by Section
1-22     1.201, Business & Commerce Code.
1-23                 (5)  "Person" has the meaning assigned by Section
1-24     1.201, Business & Commerce Code.
1-25                 (6)  "Technology" means the application of scientific
1-26     knowledge for practical purposes and includes inventions,
1-27     discoveries, trade secrets, copyrighted materials, tools, machines,
1-28     materials, processes to do work, processes to produce goods,
1-29     processes to perform services, processes to carry out other useful
1-30     activities, trademarks, and computer software.
1-31           Sec. 153.002.  FINDINGS.  The legislature finds that:
1-32                 (1)  it is essential to the continued economic growth
1-33     and diversification of this state that technology development and
1-34     transfer be promoted and expanded;
1-35                 (2)  the students, scientists, researchers, faculty,
1-36     and staff of the institutions of higher education of this state
1-37     have developed and, in all likelihood, will continue to develop
1-38     technology that will contribute to the continued growth and
1-39     diversification of the state's economy;
1-40                 (3)  the electorate of this state authorized the
1-41     legislature to allow for the programs created by this chapter by
1-42     adopting Section 52-a, Article III, Texas Constitution; and
1-43                 (4)  an institution of higher education is authorized
1-44     to engage in technology development and transfer activities under
1-45     the authority provided to its governing board and other state and
1-46     federal law.
1-47           Sec. 153.003.  CREATION OF CENTERS.  (a)  An institution of
1-48     higher education, subject to approval by its governing board, is
1-49     authorized to establish centers to manage, transfer, market, or
1-50     otherwise commercialize technology owned by it or in which it owns
1-51     an interest.
1-52           (b)  Each center shall be administered within an institution
1-53     of higher education.
1-54           (c)  Centers may provide services to multiple institutions of
1-55     higher education.  An institution of higher education may contract
1-56     with a center under the control of a governing board other than its
1-57     own.
1-58           Sec. 153.004.  OPERATION OF CENTERS.  (a)  To the extent
1-59     authorized by its governing board, an institution of higher
1-60     education, through a center established under this chapter, may:
1-61                 (1)  accept and administer funds, including state
1-62     appropriations, gifts, grants, contracts, and donations, to aid in
1-63     the establishment, maintenance, and operation of the center or to
1-64     aid in the discovery, development, protection, or commercialization
 2-1     of technology;
 2-2                 (2)  solicit and enter into agreements to fund the
 2-3     discovery, development, protection, and commercialization of
 2-4     technology;
 2-5                 (3)  make technology owned or controlled by it
 2-6     available to persons for commercial applications through license
 2-7     agreements, assignments, or other forms of transfer;
 2-8                 (4)  acquire interests in and ownership of technology;
 2-9                 (5)  provide business, scientific, and engineering
2-10     services and technical assistance to persons engaged in the
2-11     development, manufacture, or marketing of technology in which it
2-12     owns an interest;
2-13                 (6)  acquire insurance and pay premiums on insurance of
2-14     any kind and in amounts considered necessary and advisable to
2-15     accomplish the purposes of this chapter;
2-16                 (7)  establish and operate corporations, either for
2-17     profit or not for profit, and limited liability companies for the
2-18     development and commercialization of technology and convey equity
2-19     interests in such entities; and
2-20                 (8)  engage in other related activities required to
2-21     achieve the purposes of this chapter.
2-22           (b)  Property and services of institutions of higher
2-23     education may be used to achieve the purposes of this chapter.
2-24           Sec. 153.005.  PROGRAMS.  (a)  To the extent authorized by
2-25     its governing board, an institution of higher education, through a
2-26     center, may operate programs to provide assistance to persons in
2-27     commercializing technology owned by it or in which it has an
2-28     interest.  Assistance may include providing monetary support or
2-29     nonmonetary support, including the use of premises, computers,
2-30     computer software, telecommunications terminal equipment, office
2-31     equipment and supplies, machinery, custodial services, utilities,
2-32     or other services that are customarily treated as overhead expenses
2-33     by institutions of higher education.
2-34           (b)  The policies and procedures to be used by an institution
2-35     of higher education to assess the qualifications of persons
2-36     participating in a center's programs, including objective criteria
2-37     for admission and for the measurement of progress and standards for
2-38     continuance or termination of participation, shall be approved by
2-39     the institution's governing board.
2-40           Sec. 153.006.  SUPPORT OF CENTERS.  In order to carry out the
2-41     purposes of this chapter and to support the activities of centers
2-42     described in this chapter, to the extent authorized by its
2-43     governing board, an institution of higher education may:
2-44                 (1)  enter into agreements establishing royalties,
2-45     fees, and other consideration for technology developed in whole or
2-46     part by it;
2-47                 (2)  accept equity interests in organizations that
2-48     license, manage, or otherwise administer rights to technology
2-49     belonging to it or under its control in exchange for such rights,
2-50     in whole or in part;
2-51                 (3)  accept equity interests in organizations that
2-52     license or otherwise have rights in its technology as consideration
2-53     for its providing monetary, business, scientific, or engineering
2-54     services or technical assistance;
2-55                 (4)  use income from the commercialization of
2-56     technology to fund the activities of the center;
2-57                 (5)  solicit, accept, and administer gifts, grants, and
2-58     donations; and
2-59                 (6)  enter into such other business arrangements as may
2-60     be appropriate for achieving the purposes of this chapter.
2-61           Sec. 153.007.  NO FIDUCIARY DUTY.  Except as otherwise
2-62     provided by law, a governing board, an institution of higher
2-63     education, a university system, a center, or any employee or member
2-64     of those entities does not owe a fiduciary duty to any person
2-65     claiming an interest in consideration received by a university
2-66     system or an institution of higher education in exchange for
2-67     technology.
2-68           SECTION 2.  This Act takes effect September 1, 2001.
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