79R1117 KEG-D

By:  Davis of Dallas                                              H.B. No. 817



A BILL TO BE ENTITLED

AN ACT

relating to restrictions on the use of state funds to benefit 
private entities that outsource jobs to foreign countries.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subtitle F, Title 10, Government Code, is 
amended by adding Chapter 2264 to read as follows:

CHAPTER 2264. RESTRICTING STATE INVESTMENT IN AND PROVISION OF TAX 
BENEFITS TO ENTITIES THAT OUTSOURCE JOBS TO FOREIGN COUNTRIES

SUBCHAPTER A.  GENERAL PROVISIONS
	Sec. 2264.001.  DEFINITION.  In this chapter, "domestic" 
means created or organized in the United States or under the laws of 
the United States or any state.

[Sections 2264.002-2264.050 reserved for expansion]

SUBCHAPTER B. RESTRICTIONS ON INVESTMENTS
	Sec. 2264.051.  APPLICABILITY OF SUBCHAPTER.  (a)  This 
subchapter applies in connection with the management or investment 
of state funds managed or invested:
		(1)  under the Texas Constitution or other law, 
including Chapters 404 and 2256; and
		(2)  by or for:                                                        
			(A)  a public retirement system as defined by 
Section 802.001 that provides service retirement, disability 
retirement, or death benefits for officers or employees of the 
state;
			(B)  an institution of higher education as defined 
by Section 61.003, Education Code; or
			(C)  another entity that is part of state 
government and that manages or invests state funds or for which 
state funds are managed or invested.
	(b)  This subchapter applies in connection with the 
management or investment of state funds without regard to whether 
the funds are held in the state treasury.
	(c)  This subchapter does not apply to the extent that an 
investment standard prescribed by the Texas Constitution prohibits 
the legislature from restricting the investment discretion of an 
entity responsible for the management or investment of a fund.
	Sec. 2264.052.  PROHIBITION ON CERTAIN INVESTMENTS.  A state 
governmental entity may not invest state funds in or purchase 
obligations of a domestic private entity that, at any time during 
the previous two years, created employment suitable for performance 
in the United States in a country other than the United States and, 
as a result, eliminated or failed to create similar employment in 
the United States.

[Sections 2264.053-2264.100 reserved for expansion]

SUBCHAPTER C. RESTRICTIONS ON ELIGIBILITY FOR TAX AND FEE BENEFITS
	Sec. 2264.101.  DEFINITION.  In this subchapter, "state 
agency" means a department, board, commission, or other agency in 
the executive branch of state government.  The term does not include 
an institution of higher education as defined by Section 61.003, 
Education Code.
	Sec. 2264.102.  APPLICABILITY OF SUBCHAPTER.  This 
subchapter does not apply to a credit, exemption, or discount for 
which the Texas Constitution specifically prescribes the 
eligibility requirements.
	Sec. 2264.103.  INELIGIBILITY OF CERTAIN ENTITIES FOR TAX 
AND FEE BENEFITS.  Notwithstanding other law, a domestic private 
entity is not eligible for a credit, exemption, or discount in 
relation to a tax or fee imposed by the state if the entity, at any 
time during the previous two years, created employment suitable for 
performance in the United States in a country other than the United 
States and, as a result, eliminated or failed to create similar 
employment in the United States.
	Sec. 2264.104.  DENIAL OF BENEFITS.  (a)  A state agency 
responsible for the issuance of a credit, exemption, or discount in 
relation to a tax or fee imposed by the state shall adopt rules in 
accordance with Subchapter B, Chapter 2001, relating to the manner 
in which:
		(1)  the agency will determine whether to deny the 
benefit under Section 2264.103; and
		(2)  a person may ask the agency to reconsider the 
denial.           
	(b)  The rules adopted by a state agency shall require that 
as soon as practicable after making the decision to deny a credit, 
exemption, or discount to a domestic private entity that is 
ineligible for the benefit under Section 2264.103 but is otherwise 
eligible for the benefit, the state agency shall provide the 
domestic private entity with notice of and the factual basis for the 
denial and a description of the procedures available to request a 
reconsideration and to contest the factual or legal basis for the 
denial.
	SECTION 2.  Chapter 2264, Government Code, as added by this 
Act, applies only to:
		(1)  an investment made by a state governmental entity 
on or after September 1, 2006; and
		(2)  a credit, exemption, or discount provided or 
denied on or after September 1, 2006, in relation to a tax or fee 
imposed by the state.
	SECTION 3.  This Act takes effect September 1, 2005.