SRC-VRA H.B. 906 78(R)   BILL ANALYSIS


Senate Research Center   H.B. 906
78R9630 MCK-FBy: Gallego (Whitmire)
Government Organization
5/14/2003
Engrossed

DIGEST AND PURPOSE 

State agencies have human resource personnel responsible for duties,
including recruitment, classification, administration of benefits and
training. In many state agencies, Human Resources (HR) departments may be
overstaffed when compared to other HR departments servicing an equal or
comparable number of employees. Nationwide surveys indicate that the more
efficient and effective ratios of HR staff to total staff hover around the
1:100 ratio, meaning one HR staff person for every 100 employees. Records
show that many of Texas' largest state agencies deviate significantly from
the 1:100 ratio.  H.B. 906 requires large state agencies to modify their
ratios to meet the national standard. The bill also requires the State
Council on Competitive Government to conduct a feasibility study relating
to the cost-effectiveness of allowing medium-sized and small state
agencies to contract with private entities for human resources functions. 


RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to
any state officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subtitle B, Title 6, Government Code, by adding Chapter
670, as follows: 

Chapter 670.  HUMAN RESOURCES STAFFING AND FUNCTIONS

 Sec. 670.001.  Definitions.  Defines "state agency."

Sec. 670.002.  HUMAN RESOURCES STAFFING FOR LARGE STATE AGENCIES. Requires
a state agency with 500 or more full-time equivalent employees to adjust
the human resource staff so that the ratio of human resource employees to
total staff is one for every one hundred (1:100). 

Sec. 670.003.  HUMAN RESOURCES STAFFING FOR MEDIUM-SIZED AND SMALL STATE
AGENCIES; OUTSOURCING.  (a)  Requires the State Council on Competitive
Government (council) to determine the cost-effectiveness of consolidating
the human resources functions of or contracting with private entities to
perform those functions for state agencies that employ fewer than 500
full-time equivalent employees.    

(b)  Requires the council, if it determines that contracting with a
private vendor is cost-effective, to issue a request for proposals for
vendors to perform human resources functions of agencies.   

(c)  Requires the council to determine which human resources functions are
subject to the contract and which functions the agency may select to
perform itself.   

(d)  Requires each agency to pay for the contracts for human resources
functions out of the agency's human resources budget. 


 
(e)  Authorizes a state agency to appeal to the Legislative Budget Board
(LBB) for a waiver from the decision of the council to require the state
agency to consolidate the human resources functions of the agency or to
contract with a private entity to perform the human resources functions of
the agency.  Authorizes LBB to grant a waiver if it determines that, based
on the facts and circumstances of the state agency,  it would not be
cost-effective for the agency to consolidate the human resources functions
of the agency or to contract with a private entity to perform the human
resources functions of the agency.  Provides that a state agency that
receives a waiver under this subsection is exempt from the requirements of
this section. 

SECTION 2.(a)  Requires each state agency with 500 or more full-time
equivalent employees to comply with the human resources employee to staff
ratio requirements under Section 670.002 of this Act no later than
September 1, 2003. 

(b)  Requires the council to conduct an initial feasibility study to
determine the cost-effectiveness of consolidating the human resources
functions of or contracting with private entities to perform these
functions of state agencies under Section 670.003 of this Act no later
than January 1, 2004.  

SECTION 3.  Effective date:  September 1, 2003.