79S10055 KLA-F

By:  Pitts                                                        H.B. No. 5  



A BILL TO BE ENTITLED

AN ACT

relating to certain fiscal matters affecting governmental 
entities.         
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        

ARTICLE 1. MOTOR FUELS TAX
	SECTION 1.01.  Section 162.503, Tax Code, is amended to read 
as follows:     
	Sec. 162.503.  ALLOCATION OF GASOLINE TAX.  (a)  Except as 
provided by Subsection (b), on [On] or before the fifth workday 
after the end of each month, the comptroller, after making all 
deductions for refund purposes and for the amounts allocated under 
Sections 162.502 and 162.5025, shall allocate the net remainder of 
the taxes collected under Subchapter B as follows:
		(1)  one-fourth of the tax shall be deposited to the 
credit of the available school fund;
		(2)  one-half of the tax shall be deposited to the 
credit of the state highway fund for the construction and 
maintenance of the state road system under existing law; and
		(3)  from the remaining one-fourth of the tax the 
comptroller shall:        
			(A)  deposit to the credit of the county and road 
district highway fund all the remaining tax receipts until a total 
of $7,300,000 has been credited to the fund each fiscal year; and
			(B)  after the amount required to be deposited to 
the county and road district highway fund has been deposited, 
deposit to the credit of the state highway fund the remainder of the 
one-fourth of the tax, the amount to be provided on the basis of 
allocations made each month of the fiscal year, which sum shall be 
used by the Texas Department of Transportation for the 
construction, improvement, and maintenance of farm-to-market 
roads.
	(b)  During the months of June, July, and August of each 
odd-numbered year, the comptroller may not make the allocations to 
the state highway fund and county and road district highway fund 
otherwise required by Subsections (a)(2) and (3).  After September 
5 and before September 11 of that year, the comptroller shall 
allocate and deposit to the state highway fund the total amount of 
revenue that would have been otherwise allocated and deposited to 
that fund during those months.
	SECTION 1.02.  Section 162.504, Tax Code, is amended to read 
as follows:     
	Sec. 162.504.  ALLOCATION OF DIESEL FUEL TAX.  (a)  Except as 
provided by Subsection (b), on [On] or before the fifth workday 
after the end of each month, the comptroller, after making 
deductions for refund purposes, for the administration and 
enforcement of this chapter, and for the amounts allocated under 
Section 162.5025, shall allocate the remainder of the taxes 
collected under Subchapter C as follows:
		(1)  one-fourth of the taxes shall be deposited to the 
credit of the available school fund; and
		(2)  three-fourths of the taxes shall be deposited to 
the credit of the state highway fund.
	(b)  During the months of June, July, and August of each 
odd-numbered year, the comptroller may not make the allocation to 
the state highway fund otherwise required by Subsection (a)(2).  
After September 5 and before September 11 of that year, the 
comptroller shall allocate and deposit to the state highway fund 
the total amount of revenue that would have been otherwise 
allocated to that fund during those months.
	SECTION 1.03.  Section 162.505, Tax Code, is amended to read 
as follows:     
	Sec. 162.505.  ALLOCATION OF LIQUEFIED GAS TAX.  (a)  Except 
as provided by Subsection (b), on [On] or before the fifth workday 
after the end of each month, the comptroller, after making 
deductions for refund purposes and for the administration and 
enforcement of this chapter, shall allocate the remainder of the 
taxes collected under Subchapter D as follows:
		(1)  one-fourth of the taxes shall be deposited to the 
credit of the available school fund; and
		(2)  three-fourths of the taxes shall be deposited to 
the credit of the state highway fund.
	(b)  During the months of June, July, and August of each 
odd-numbered year, the comptroller may not make the allocation to 
the state highway fund otherwise required by Subsection (a)(2).  
After September 5 and before September 11 of that year, the 
comptroller shall allocate and deposit to the state highway fund 
the total amount of revenue that would have been otherwise 
allocated to that fund during those months.
	SECTION 1.04.  This article takes effect June 1, 2007.                         

ARTICLE 2.  AUTHORIZATION OF CERTAIN NONPROFIT ORGANIZATIONS TO 
CONDUCT BINGO
	SECTION 2.01.  Section 2001.002(11), Occupations Code, is 
amended to read as follows:
		(11)  "Fraternal organization" means:                                         
			(A)  a nonprofit organization organized to 
perform and engaged primarily in performing charitable, 
benevolent, patriotic, employment-related, or educational 
functions that meet the other requirements of this chapter; [or]
			(B)  a nonprofit National Historical District 
Association representing the owners and lessees of a majority of 
the real property located in a National Historical District 
designated for not less than five years by the National Register of 
Historic Places, Heritage Conservation and Recreation Service of 
the United States Department of the Interior, if the association's 
net proceeds are used for restoration, construction, maintenance, 
and security in the district.  The term "fraternal organization" 
does not include an organization whose members are predominantly 
veterans or dependents of veterans of the armed services of the 
United States; or
			(C)  a nonprofit organization that:                                   
				(i)  is organized under tribal law by a 
federally recognized Indian tribe that is not subject to the Indian 
Gaming Regulatory Act (18 U.S.C. Section 1166 et seq. and 25 U.S.C. 
Section 2701 et seq.) and that exercises tribal authority over a 
reservation, as defined by 25 U.S.C. Section 1300g, that is located 
in a county on the international border with Mexico; and
				(ii)  is organized to perform and is engaged 
primarily in performing charitable, benevolent, patriotic, or 
educational functions.
	SECTION 2.02.  Subchapter C, Chapter 2001, Occupations Code, 
is amended by adding Section 2001.1015 to read as follows:
	Sec. 2001.1015.  CERTAIN TRIBAL ORGANIZATIONS SUBJECT TO 
REGULATORY JURISDICTION AND LICENSE REQUIREMENTS.  (a)  A nonprofit 
organization in existence for at least 180 days that qualifies as a 
fraternal organization under Section 2001.002(11)(C) may conduct 
bingo on the reservation of the Indian tribe under whose tribal law 
the organization is organized on adoption by the tribe of rules 
governing the conduct of bingo by the organization that conform to 
the substantive provisions of this chapter and of Sections 47(b) 
and (c), Article III, Texas Constitution.
	(b)  In accordance with Section 107(b), Ysleta del Sur Pueblo 
and Alabama and Coushatta Indian Tribes of Texas Restoration Act 
(25 U.S.C. Section 1300g-6), an organization described by 
Subsection (a) may conduct bingo activities in accordance with the 
tribe's rules adopted under Subsection (a) by submitting to the 
regulatory jurisdiction, including licensing requirements, of this 
state.
	(c)  A nonprofit organization described by Subsection (b) 
may not conduct bingo under this section unless the organization 
transfers to the state on a monthly basis an amount equal to five 
percent of the gross receipts from bingo in a manner determined by 
the comptroller.
	ARTICLE 3.   DIESEL FUEL CREDIT
	SECTION 3.01.  Section 162.227, Tax Code, is amended by 
adding Subsections (c-1) and (d-1) to read as follows:
	(c-1)  A license holder may take a credit on a return for the 
period in which the purchase occurred, and a person who does not 
hold a license may file a refund claim with the comptroller, if the 
license holder or person paid tax on diesel fuel and the diesel fuel 
is used in this state:
		(1)  as a feedstock or other component in the further 
manufacturing of tangible personal property for resale not as a 
motor fuel; or
		(2)  in the original production of oil or gas or to 
increase the production of oil or gas.
	(d-1)  A license holder may take a credit on a return for the 
period in which the purchase occurred, and a person who does not 
hold a license may file a refund claim with the comptroller, if the 
license holder or person paid tax on diesel fuel and the diesel fuel 
is used in this state by auxiliary power units or power take-off 
equipment on  any motor vehicle.  If the quantity of that diesel 
fuel can be accurately measured while the motor vehicle is 
stationary by any metering or other measuring device or method 
designed to measure the fuel separately from fuel used to propel the 
motor vehicle, the comptroller may approve and adopt the use of the 
device as a basis for determining the quantity of diesel fuel 
consumed in those operations for a tax credit or tax refund.  If 
there is no separate metering device or other approved measuring 
method, the license holder may take the credit and the person who 
does not hold a license may claim the refund on a percentage of the 
diesel fuel consumed by each motor vehicle equipped with an 
auxiliary power unit or power take-off equipment.  The comptroller 
shall determine the percentage of the credit or refund.  The 
climate-control air conditioning or heating system of a motor 
vehicle that has a primary purpose of providing for the convenience 
or comfort of the operator or passengers is not a power take-off 
system, and a credit or refund may not be allowed for the tax paid on 
any portion of the diesel fuel that is used for that purpose.  A 
credit or refund may not be allowed for the diesel fuel tax paid on 
that portion of the diesel fuel that is used for idling.
	SECTION 3.02.  This article takes effect November 1, 2005, 
and applies only to taxes imposed on or after that date.  Taxes 
imposed before that date are governed by the law in effect on the 
date the taxes are imposed, and that law is continued in effect for 
that purpose.

ARTICLE 4.  MOTOR VEHICLE SALES AND USE TAX
	SECTION 4.01.  Section 152.002, Tax Code, is amended by 
adding Subsection (f) to read as follows:
	(f)  Notwithstanding Subsection (a), the total consideration 
of a used motor vehicle is the amount on which the tax is computed as 
provided by Section 152.0412.
	SECTION 4.02.  Section 152.041(a), Tax Code, is amended to 
read as follows:  
	(a)  The tax assessor-collector of the county in which an 
application for registration or for a Texas certificate of title is 
made shall collect taxes imposed by this chapter, subject to 
Section 152.0412, unless another person is required by this chapter 
to collect the taxes.
	SECTION 4.03.  Subchapter C, Chapter 152, Tax Code, is 
amended by adding Section 152.0412 to read as follows:
	Sec. 152.0412.  STANDARD PRESUMPTIVE VALUE; USE BY TAX 
ASSESSOR-COLLECTOR.  (a)  In this section, "standard presumptive 
value" means the average retail value of a motor vehicle as 
determined by the Texas Department of Transportation, based on a 
nationally recognized motor vehicle industry reporting service.
	(b)  If the amount paid for a motor vehicle subject to the tax 
imposed by this chapter is equal to or greater than the standard 
presumptive value of the vehicle, a county tax assessor-collector 
shall compute the tax on the amount paid.
	(c)  If the amount paid for a motor vehicle subject to the tax 
imposed by this chapter is less than the standard presumptive value 
of the vehicle, a county tax assessor-collector shall compute the 
tax on the standard presumptive value unless the purchaser 
establishes the retail value of the vehicle as provided by 
Subsection (d).
	(d)  A county tax assessor-collector shall compute the tax 
imposed by this chapter on the retail value of a motor vehicle if:
		(1)  the retail value is shown on an appraisal 
certified by an adjuster licensed under Chapter 4101, Insurance 
Code, or by a motor vehicle dealer operating under Subchapter B, 
Chapter 503, Transportation Code;
		(2)  the appraisal is on a form prescribed by the 
comptroller for that purpose; and
		(3)  the purchaser of the vehicle obtains the appraisal 
not later than the 20th day after the date of purchase.
	(e)  On request, a motor vehicle dealer operating under 
Subchapter B, Chapter 503, Transportation Code, shall provide a 
certified appraisal of the retail value of a motor vehicle.  The 
comptroller by rule shall establish a fee that a dealer may charge 
for providing the certified appraisal.  The county tax 
assessor-collector shall retain a copy of a certified appraisal 
received under this section for a period prescribed by the 
comptroller.
	(f)  The Texas Department of Transportation shall maintain 
information on the standard presumptive values of motor vehicles as 
part of the department's registration and title system.  The 
department shall update the information at least quarterly each 
calendar year.
	(g)  This section does not apply to a transaction described 
by Section 152.024 or 152.025.
	SECTION 4.04.  Not later than December 1, 2005, the Texas 
Department of Transportation shall:
		(1)  establish standard presumptive values for motor 
vehicles as provided by Section 152.0412, Tax Code, as added by this 
article;
		(2)  modify the department's registration and title 
system as needed to include that information and administer that 
section; and
		(3)  make that information available through the system 
to all county tax assessor-collectors.
	SECTION 4.05.  (a)  Except as provided by Subsection (b) of 
this section, this article takes effect September 1, 2005, if this 
Act receives a vote of two-thirds of all the members elected to each 
house, as provided by Section 39, Article III, Texas Constitution.  
If this Act does not receive the vote necessary for effect on that 
date, this article takes effect November 1, 2005.
	(b)  Section 152.0412, Tax Code, as added by this article, 
takes effect December 1, 2005.

ARTICLE 5.  INVESTMENT OF STATE AND OTHER GOVERNMENTAL ENTITY FUNDS
	SECTION 5.01.  Section 404.024, Government Code, is amended 
by amending Subsections (b) and (l) and adding Subsections (m) and 
(n) to read as follows:
	(b)  State funds not deposited in state depositories shall be 
invested by the comptroller in:
		(1)  direct security repurchase agreements;                                   
		(2)  reverse security repurchase agreements;                                  
		(3)  direct obligations of or obligations the principal 
and interest of which are guaranteed by the United States;
		(4)  direct obligations of or obligations guaranteed by 
agencies or instrumentalities of the United States government;
		(5)  bankers' acceptances that:                                               
			(A)  are eligible for purchase by the Federal 
Reserve System;              
			(B)  do not exceed 270 days to maturity; and                                 
			(C)  are issued by a bank whose other comparable 
short-term obligations are rated in [that has received] the highest 
short-term [credit] rating category, within which there may be 
subcategories or gradations, including such subcategories or 
gradations as "rating category" or "rated," indicating relative 
standing by a nationally recognized statistical rating 
organization, as defined by Rule 2a-7 (17 C.F.R. Part 270.2a-7), 
promulgated under the Investment Company Act of 1940 by the 
Securities and Exchange Commission [investment rating firm];
		(6)  commercial paper that:                                                   
			(A)  does not exceed 270 days to maturity; and                               
			(B)  except as provided by Subsection (i), is 
issued by an entity whose other comparable short-term obligations 
are rated in [has received] the highest short-term [credit] rating 
category by a nationally recognized statistical rating 
organization [investment rating firm];
		(7)  contracts written by the treasury in which the 
treasury grants the purchaser the right to purchase securities in 
the treasury's marketable securities portfolio at a specified price 
over a specified period and for which the treasury is paid a fee and 
specifically prohibits naked-option or uncovered option trading;
		(8)  direct obligations of or obligations guaranteed by 
the Inter-American Development Bank, the International Bank for 
Reconstruction and Development (the World Bank), the African 
Development Bank, the Asian Development Bank, and the International 
Finance Corporation that have received the highest long-term 
[credit] rating categories for debt obligations by a nationally 
recognized statistical rating organization [investment rating 
firm];
		(9)  bonds issued, assumed, or guaranteed by the State 
of Israel;           
		(10)  obligations of a state or an agency, county, 
city, or other political subdivision of a state;
		(11)  mutual funds secured by obligations that are 
described by Subdivisions (1) through (6), including pooled funds:
			(A)  established by the Texas Treasury 
Safekeeping Trust Company;          
			(B)  operated like a mutual fund; and                                        
			(C)  with portfolios consisting only of 
dollar-denominated securities; [and]
		(12)  foreign currency for the sole purpose of 
facilitating investment by state agencies that have the authority 
to invest in foreign securities;
		(13)  asset-backed securities, as defined by the 
Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Part 
270.2a-7), that are rated at least A or its equivalent by a 
nationally recognized statistical rating organization and that 
have a weighted-average maturity of five years or less; and
		(14)  corporate debt obligations that are rated at 
least A or its equivalent by a nationally recognized statistical 
rating organization and mature in five years or less from the date 
on which the obligations were "acquired," as defined by the 
Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Part 
270.2a-7).
	(l)  The comptroller may lend securities under procedures 
established by the comptroller.  The procedures must be consistent 
with industry practice and must include a requirement to fully 
secure the loan with cash, obligations described by Subsections 
(b)(1)-(6), or a combination of cash and the described obligations.  
Notwithstanding any provision to the contrary, cash may be 
reinvested in the items permitted under Subsection (b) or mutual 
funds secured by the items permitted under Subsection (b) [In this 
subsection, "obligation" means an item described by Subsections 
(b)(1)-(6)].
	(m)  In entering into a direct security repurchase agreement 
or a reverse security repurchase agreement, the comptroller may 
agree to accept cash on an overnight basis in lieu of the 
securities, obligations, or participation certificates identified 
in Section 404.001(3).  Cash held by the state under this subsection 
is not a deposit of state or public funds for the purposes of any 
law, including this subchapter or Subchapter D, that requires a 
deposit of state or public funds to be collateralized by eligible 
securities.
	(n)  Notwithstanding any other law to the contrary, any 
government investment pool created to function as a money market 
mutual fund and managed by the comptroller or the Texas Treasury 
Safekeeping Trust Company may invest the funds it receives in 
investments that are "eligible securities," as defined by the 
Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Part 
270.2a-7), if it maintains a dollar-weighted average portfolio 
maturity of 90 days or less, with the maturity of each portfolio 
security calculated in accordance with Rule 2a-7 (17 C.F.R. Part 
270.2a-7), and meets the diversification requirements of Rule 2a-7.
	SECTION 5.02.  Section 2256.011, Government Code, is amended 
by amending Subsection (a) and adding Subsection (e) to read as 
follows:
	(a)  A fully collateralized repurchase agreement is an 
authorized investment under this subchapter if the repurchase 
agreement:
		(1)  has a defined termination date;                                          
		(2)  except as provided by Subsection (e), is secured 
by obligations described by Section 2256.009(a)(1); [and]
		(3)  requires the securities being purchased by the 
entity to be pledged to the entity, held in the entity's name, and 
deposited at the time the investment is made with the entity or with 
a third party selected and approved by the entity; and
		(4)  is placed through a primary government securities 
dealer, as defined by the Federal Reserve, or a financial 
institution doing business in this state.
	(e)  For purposes of this section, an entity may agree to 
secure the agreement by accepting cash on an overnight basis in lieu 
of the obligations identified in Section 2256.009(a)(1).  Cash held 
by an entity under this subsection is not a deposit of public funds 
for purposes of any statute, including Chapter 2257, that requires 
a deposit of public funds to be collateralized by eligible 
securities.
	SECTION 5.03.  Section 2256.016, Government Code, is amended 
by amending Subsections (a) and (f) and adding Subsection (i) to 
read as follows:
	(a)  An entity may invest its funds and funds under its 
control through an eligible investment pool if the governing body 
of the entity by rule, order, ordinance, or resolution, as 
appropriate, authorizes investment in the particular pool.  An 
investment pool created to function as a money market mutual fund 
may invest the funds it receives from entities in investments that 
are "eligible securities," as defined by the Securities and 
Exchange Commission in Rule 2a-7 (17 C.F.R. Part 270.2a-7), 
promulgated under the Investment Company Act of 1940.  Any other 
[An] investment pool shall invest the funds it receives from 
entities in authorized investments permitted by this subchapter.
	(f)  To be eligible to receive funds from and invest funds on 
behalf of an entity under this chapter, a public funds investment 
pool created to function as a money market mutual fund must:
		(1)  mark its portfolio to market daily, and, to the 
extent reasonably possible, stabilize at a $1 net asset value.  If 
the ratio of the market value of the portfolio divided by the book 
value of the portfolio is less than 0.995 or greater than 1.005, 
portfolio holdings shall be sold as necessary to maintain the ratio 
between 0.995 and 1.005;
		(2)  maintain a dollar-weighted average portfolio 
maturity of 90 days or less, with the maturity of each portfolio 
security calculated in accordance with Rule 2a-7 (17 C.F.R. Part 
270.2a-7); and
		(3)  meet the diversification requirements of Rule 2a-7 
(17 C.F.R. Part 270.2a-7) promulgated by the Securities and 
Exchange Commission.
	(i)  In this section, "stated maturity date" means the 
average life of a security with periodic principal payments, the 
number of days until the next interest rate reset date for variable 
rate securities, or the final maturity date for all other 
securities.
	SECTION 5.04.  This article takes effect immediately if this 
Act receives a vote of two-thirds of all the members elected to each 
house, as provided by Section 39, Article III, Texas Constitution.  
If this Act does not receive the vote necessary for immediate 
effect, this article takes effect November 1, 2005.

ARTICLE 6.  COLLECTION OF DELINQUENT OBLIGATIONS TO STATE
	SECTION 6.01.  Section 403.019(c), Government Code, is 
amended to read as follows:
	(c)  A contract under this section is not valid unless 
approved by the attorney general.  The attorney general shall 
approve a contract if the attorney general determines that the 
contract complies with the requirements of this section, that the 
contract does not conflict with any contract formed under Section 
2107.003(b), and that the contract [and] is in the best interest of 
the state.  No judicial action by any person on behalf of the state 
under a contract authorized and approved by this section may be 
brought unless approved by the attorney general.
	SECTION 6.02.  Section 2107.003, Government Code, is amended 
to read as follows:
	Sec. 2107.003.  COLLECTION BY ATTORNEY GENERAL, 
COMPTROLLER, OR OUTSIDE AGENT.  (a)  Except as provided by Section 
2107.004 [Subsection (c)], a state agency shall report an 
uncollected and delinquent obligation to [request] the attorney 
general for collection.  The state agency must report the 
obligation on or before the 120th day after the date the obligation 
becomes past due or delinquent [to collect an obligation before the 
agency may employ, retain, or contract with a person other than a 
full-time employee of the state agency to collect the obligation].
	(b)  The attorney general:                                              
		(1)  shall provide legal services for collection of the 
obligation;  
		(2)  may authorize the requesting state agency to 
employ, retain, or contract, subject to approval by the attorney 
general, with one or more persons to collect the obligation; or
		(3)  if the attorney general determines it to be 
economical and in the best interest of the state, may contract with 
one or more persons [a person other than a full-time employee of the 
agency] to collect the [an] obligation [that the attorney general 
cannot collect].
	(c)  The comptroller may employ, retain, or contract with a 
person other than a full-time state employee to collect delinquent 
obligations that are owed the comptroller in the comptroller's 
official capacity, are not collected through normal collection 
procedures, and do not meet the guidelines adopted for collection 
by the attorney general.  A proposed contract under this subsection 
shall be reviewed by the attorney general and may include a 
collection fee computed on the amounts collected under the 
contract.
	(d)  The agency contracting under Subsection (b) is entitled 
to recover from the obligor, in addition to the amount of the 
obligation, the costs incurred in undertaking the collection, 
including the costs of a contract under this section.  The obligor 
is liable for costs of recovery under this section in an amount 
equal to 30 percent of the sum of the amount of the obligation and 
any penalty and interest due on the obligation.
	(e)  A contract formed under Subsection (b) must provide for 
the compensation due to the contractor.  The amount of the 
compensation shall be equal to 30 percent of the sum of the 
collected amount of:
		(1)  the obligation;                                                   
		(2)  any penalty; and                                                  
		(3)  any interest.                                                     
	(f)  A contract formed under Subsection (b) or (c) may permit 
or require the contractor to pursue a judicial action to collect the 
amount of the obligation in a proper court in or outside of this 
state.
	(g)  In a suit in a Texas state court brought by a contractor 
to collect an obligation under this section, the state is not:
		(1)  required to post security for costs;                              
		(2)  liable for costs; and                                             
		(3)  liable for fees for:                                              
			(A)  service of process;                                              
			(B)  attorneys ad litem;                                              
			(C)  arbitration; or                                                  
			(D)  mediation.                                                       
	(h)  An amount collected under a contract formed under 
Subsection (b), including the costs of recovery and court costs or 
other costs, shall be deposited in the fund or account to which the 
obligation was required to be deposited.  The contracting agency 
shall pay the compensation due under the contract to the contractor 
and shall pay to the applicable court any court costs collected.
	(i)  The contracting agency shall require a person 
contracting under Subsection (b) to post a bond or other security in 
an amount the contracting agency determines is sufficient to cover 
all revenue or other property of the state that is expected to come 
into the possession or control of the contractor in the course of 
providing contract services.
	(j)  A person who contracts under Subsection (b) is an agent 
of this state for purposes of determining priority of a claim to be 
collected under the contract with respect to claims of other 
creditors.  The contractor does not exercise any sovereign power of 
the state.
	(k)  The contracting state agency may provide a person 
contracting under Subsection (b) any information, including 
confidential information, that the agency is not prohibited from 
sharing under an agreement with another state or with the United 
States and that is:
		(1)  in the custody of the agency holding the claim; and               
		(2)  necessary to the collection of the obligation.                    
	(l)  A person acting under a contract formed under Subsection 
(b) or (c) and each employee or agent of that person is subject to 
all prohibitions against the disclosure of confidential 
information obtained from the contracting agency, the reporting 
state agency, or their employees.  A contractor or the contractor's 
employee or agent who discloses confidential information in 
violation of the prohibition is subject to the same penalties for 
that disclosure as would apply to the contracting agency or its 
employees.
	(m)  The contracting agency shall require a person who 
contracts under Subsection (b) to obtain and maintain insurance 
adequate to provide reasonable coverage for damages negligently, 
recklessly, or intentionally caused by the contractor or the 
contractor's employee or agent in the course of collecting an 
obligation under the contract and to protect this state from 
liability for those damages.  The state is not liable for and may 
not indemnify a person acting under a contract under Subsection (b) 
for damages negligently, recklessly, or intentionally caused by the 
contractor or the contractor's employee or agent in the course of 
collecting an obligation under the contract.
	(n)  In addition to grounds for termination provided by the 
contract terms, the attorney general or the contracting agency, as 
applicable, may terminate a contract formed under Subsection (b) if 
the contractor or the contractor's employee or agent:
		(1)  violates the federal Fair Debt Collection 
Practices Act (15 U.S.C. Section 1692 et seq.);
		(2)  discloses confidential information to a person not 
authorized to receive the information; or
		(3)  performs any act that results in a final judgment 
for damages against this state.
	SECTION 6.03.  Section 2254.102(c), Government Code, is 
amended to read as follows:
	(c)  This subchapter does not apply to a contract:                      
		(1)  with an agency to collect an obligation under 
Section 2107.003(b); or
		(2)  for legal services entered into by an institution 
of higher education under Section 153.006, Education Code.

ARTICLE 7.  UNCLAIMED PROPERTY
	SECTION 7.01.  Subchapter H, Chapter 74, Property Code, is 
amended by adding Section 74.7085 to read as follows:
	Sec. 74.7085.  HEARING.  (a)  If, after an examination of 
records under Section 74.702, the comptroller determines that a 
person holds unclaimed property that should have been delivered to 
the comptroller as provided by this chapter, the person may 
petition the comptroller for a hearing on that determination and on 
the imposition of any interest or penalty resulting from that 
determination.
	(b)  A person must file a petition for a hearing with the 
comptroller under this section not later than the 30th day after the 
date the determination is made.  If a petition for a hearing is not 
filed before the expiration of the period provided by this 
subsection, the determination is final on the expiration of that 
period.
	(c)  At the time a person files a petition for a hearing under 
Subsection (b), the person must pay to the comptroller a hearing fee 
in the amount of $50, which shall be used by the comptroller for the 
purpose of administering hearings under this section.
	SECTION 7.02.  Subchapter A, Chapter 74, Property Code, is 
amended by adding Section 74.002 to read as follows:
	Sec. 74.002.  SINGLE BUSINESS ENTERPRISE DOCTRINE 
INAPPLICABLE.  The single business enterprise doctrine does not 
apply to this chapter.
	SECTION 7.03.  The change in law made by Section 74.7085, 
Property Code, as added by this article, applies only to a 
determination by the comptroller made on or after the effective 
date of this Act.  A determination by the comptroller made before 
the effective date of this Act is governed by the law in effect on 
the date the determination was made, and the former law is continued 
in effect for that purpose.
	SECTION 7.04.  Section 74.002, Property Code, as added by 
this article, is intended only to clarify existing law with respect 
to Chapter 74, Property Code.

ARTICLE 8.  EFFECTIVE DATE
	SECTION 8.01.  Except as otherwise provided by this Act, 
this Act takes effect immediately if it receives a vote of 
two-thirds of all the members elected to each house, as provided by 
Section 39, Article III, Texas Constitution.  If this Act does not 
receive the vote necessary for immediate effect, except as 
otherwise provided by this Act, this Act takes effect on the 91st 
day after the last day of the legislative session.