By: Staples S.B. No. 1651
(In the Senate - Filed March 11, 2005; March 30, 2005, read
first time and referred to Committee on Government Organization;
May 12, 2005, reported adversely, with favorable Committee
Substitute by the following vote: Yeas 6, Nays 0; May 12, 2005,
sent to printer.)
COMMITTEE SUBSTITUTE FOR S.B. No. 1651 By: Harris
A BILL TO BE ENTITLED
AN ACT
relating to an office of inspector general at certain state
agencies.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 10, Government Code, is
amended by adding Chapter 2115 to read as follows:
CHAPTER 2115. TEXAS INSPECTORS GENERAL
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2115.001. DEFINITIONS. In this chapter:
(1) "Agency" means a state agency to which this
chapter applies, as provided by Section 2115.002.
(2) "Inspector general" means an individual appointed
as an inspector general at an agency under this chapter.
(3) "Presiding officer" means the presiding officer of
the governing body of an agency, or the commissioner of an agency if
a single commissioner presides over the agency.
(4) "Review" includes an inspection, investigation,
or similar activity.
Sec. 2115.002. APPLICABILITY TO CERTAIN STATE AGENCIES.
This chapter applies to the following state agencies:
(1) Health and Human Services Commission;
(2) Texas Building and Procurement Commission;
(3) Texas Commission on Environmental Quality;
(4) Texas Department of Criminal Justice;
(5) Texas Department of Insurance;
(6) Texas Department of Transportation;
(7) Texas Education Agency;
(8) Texas Higher Education Coordinating Board;
(9) Texas Workers' Compensation Commission; and
(10) Texas Workforce Commission.
[Sections 2115.003-2115.050 reserved for expansion]
SUBCHAPTER B. ADMINISTRATIVE PROVISIONS
Sec. 2115.051. CREATION OF OFFICE OF INSPECTOR GENERAL.
The office of inspector general is created at each agency as
provided by this chapter to conduct investigations, inspections,
and other reviews.
Sec. 2115.052. APPOINTMENT; TERM. (a) The governor shall
appoint an inspector general to serve within each agency.
(b) An inspector general serves a two-year term expiring
February 1 of each odd-numbered year.
Sec. 2115.053. QUALIFICATIONS. (a) In appointing a person
as inspector general, the governor shall consider the person's
integrity, capability for strong leadership, and demonstrated
knowledge, skills, abilities, and experience in investigation,
prosecution, management analysis, public administration, criminal
justice administration, accounting, auditing, financial analysis,
law, or other closely related fields.
(b) Additional recommended qualifications for appointing an
inspector general include licenses or certifications as a lawyer,
fraud examiner, public accountant, or internal auditor.
Sec. 2115.054. CONFLICT OF INTEREST. (a) An inspector
general may not serve as an ex officio member on the governing body
of a governmental entity.
(b) An inspector general may not have a financial interest
in the transactions of the inspector general's agency.
Sec. 2115.055. ORGANIZATION. (a) An inspector general
shall establish an organizational structure for the inspector
general's office that is appropriate to carrying out the
responsibilities and functions of the office.
(b) The office must be established within the agency using
existing agency resources dedicated to the investigation of fraud,
abuse, and employee misconduct.
Sec. 2115.056. INDEPENDENCE OF OFFICE. (a) Except as
provided by Sections 2115.157, 2115.161, 2115.201, and 2115.202, an
inspector general operates independently of the agency in which the
inspector general serves.
(b) An executive state agency may not impair or prohibit an
inspector general from initiating or completing a review.
Sec. 2115.057. OPERATION OF OFFICE. An inspector general
shall establish policies and procedures to guide the operation of
the inspector general's office.
Sec. 2115.058. QUALITY ASSURANCE AND CONTROL. (a) An
inspector general shall adopt procedures to ensure adequate quality
control over the inspector general's work and practices and to
ensure that the work of the inspector general's office meets
commonly used and adopted professional standards.
(b) The inspector general shall implement the quality
control program to guarantee that the office is structured
appropriately and that the office implements policies and practices
to ensure objective and accurate reviews.
Sec. 2115.059. PUBLISHING POLICIES AND PROCEDURES IN TEXAS
REGISTER. An inspector general shall publish in the Texas Register
the policies and procedures adopted under this subchapter.
[Sections 2115.060-2115.100 reserved for expansion]
SUBCHAPTER C. PERSONNEL
Sec. 2115.101. EMPLOYEES. Subject to Section 2115.055, an
inspector general may employ personnel as necessary to administer
the inspector general's office by using existing agency resources
dedicated to the investigation of fraud, abuse, and employee
misconduct.
Sec. 2115.102. EXPERTS. Subject to Section 2115.055, an
inspector general may contract with certified public accountants,
management consultants, or other professional experts necessary to
independently perform the functions of the inspector general's
office. The inspector general shall use existing agency resources
dedicated to the investigation of fraud, abuse, and employee
misconduct for this purpose.
[Sections 2115.103-2115.150 reserved for expansion]
SUBCHAPTER D. GENERAL POWERS AND DUTIES OF INSPECTOR GENERAL
Sec. 2115.151. REVIEW AUTHORITY. (a) An inspector general
may evaluate any activity or operation of the inspector general's
agency related to the investigation, detection, or prevention of
fraud or employee misconduct. A review may include an
investigation or other inquiry into:
(1) a specific act or allegation of impropriety,
malfeasance, or nonfeasance in the obligation, spending, receipt,
or other use of state money; or
(2) a specific financial transaction or practice that
may involve the impropriety, malfeasance, or nonfeasance.
(b) An inspector general may conduct criminal, civil, and
administrative reviews related to the course and scope of the
duties of the inspector general.
Sec. 2115.152. INITIATION OF REVIEW. An inspector general
may initiate a review:
(1) on the inspector general's own initiative; or
(2) based on a complaint from any source concerning a
matter described by Section 2115.151 at the agency.
Sec. 2115.153. FACTUAL DETERMINATION OF REVIEW. (a) An
inspector general is charged solely with making a determination of
the truth of a complaint based on a finding of facts and presenting
those findings as provided in Subchapter E.
(b) An inspector general may not make remedial
recommendations.
Sec. 2115.154. ACCESS TO INFORMATION. (a) In furtherance
of a review conducted by the inspector general's office, an
inspector general is entitled to access all books, accounts,
reports, vouchers, or other information from any entity receiving
money from the inspector general's agency, including confidential
information and electronic data. The inspector general may not
access data or other information the release of which is restricted
under federal law unless the appropriate federal agency approves
the release.
(b) To the extent that the performance of the powers and
duties of the inspector general is not impeded, an inspector
general shall make reasonable efforts to coordinate requests for
access under Subsection (a) so as not to hinder the daily operations
of the entity.
Sec. 2115.155. COOPERATION REQUIRED. (a) In furtherance
of a review conducted by the inspector general's office, an
inspector general may require the assistance of the administrative
head, the governing body, an auditor or accountant, or any other
employee of the inspector general's agency.
(b) To the extent that the performance of the powers and
duties of the inspector general is not impeded, an inspector
general shall make reasonable efforts to coordinate requests for
assistance under Subsection (a) so as not to hinder the daily
operations of the agency.
Sec. 2115.156. EMPLOYEE REPORTS. An inspector general may
require employees at the inspector general's agency to report to
the agency's office information regarding fraud, waste, misuse,
corruption, illegal acts, or abuse.
Sec. 2115.157. SUBPOENAS. (a) On request of an inspector
general, a district attorney or the attorney general may issue a
subpoena to compel the attendance of a relevant witness or the
production, for inspection or copying, of relevant evidence in
connection with a review conducted under this chapter.
(b) A subpoena may be served personally or by certified
mail.
(c) If a person fails to comply with a subpoena, the
inspector general, acting through the attorney general, may file
suit to enforce the subpoena in a district court in this state.
(d) On finding that good cause exists for issuing the
subpoena, the court shall order the person to comply with the
subpoena. The court may hold in contempt a person who fails to obey
the court order.
(e) The inspector general shall pay a reasonable fee for
photocopies subpoenaed under this section in an amount not to
exceed the amount the inspector general may charge for copies of its
records.
(f) The reimbursement of the expenses of a witness whose
attendance is compelled under this section is governed by Section
2001.103.
Sec. 2115.158. INTERNAL AUDITOR. (a) In this section,
"internal auditor" means a person appointed under Section 2102.006.
(b) The internal auditor for the agency shall provide the
inspector general with a copy of the agency's internal audit plan
to:
(1) assist in the coordination of efforts between the
inspector general and the internal auditor; and
(2) limit duplication of effort regarding reviews by
the inspector general and internal auditor.
(c) The internal auditor shall provide to the inspector
general all final audit reports concerning audits of any:
(1) part or division of the agency;
(2) contract, procurement, or grant; and
(3) program conducted by the agency.
Sec. 2115.159. COOPERATION WITH LAW ENFORCEMENT OFFICIALS
AND OTHER ENTITIES. (a) An inspector general may provide
information and evidence relating to criminal acts to the state
auditor's office and appropriate law enforcement officials.
(b) An inspector general may refer matters for further
civil, criminal, and administrative action to appropriate
administrative and prosecutorial agencies, including the attorney
general.
(c) An inspector general may enter into a memorandum of
understanding with a law enforcement or prosecutorial agency,
including the office of the attorney general, to assist in
conducting a review under this chapter.
Sec. 2115.160. COOPERATION AND COORDINATION WITH STATE
AUDITOR. (a) The state auditor may, on request of an inspector
general, provide appropriate information or other assistance to the
inspector general, as determined by the state auditor.
(b) An inspector general may meet with the state auditor's
office to coordinate a review conducted under this chapter, share
information, or schedule work plans.
(c) The state auditor is entitled to access all information
maintained by an inspector general, including vouchers and
electronic data and information obtained under Section 2115.154 or
subject to 2115.251.
(d) Any information obtained or provided by the state
auditor under this section is confidential and not subject to
disclosure under Chapter 552.
Sec. 2115.161. PREVENTION. An inspector general may
provide training or other education regarding the prevention of
fraud, waste, or abuse at the inspector general's agency. The
training or education must be approved by the presiding officer.
Sec. 2115.162. RULEMAKING. (a) An agency may adopt rules
to respond to reports and referrals from the agency's inspector
general, including sanctions for violations.
(b) The rules shall include due process for referrals and
findings that might result in administrative penalties.
[Sections 2115.163-2115.200 reserved for expansion]
SUBCHAPTER E. OVERSIGHT OF INSPECTOR GENERAL; REPORTS
Sec. 2115.201. ORGANIZATION PLACEMENT. An inspector
general reports to the presiding officer of the inspector general's
agency.
Sec. 2115.202. ANNUAL EVALUATION. An agency's presiding
officer shall conduct an annual evaluation of the agency's
inspector general. As part of this evaluation, the presiding
officer may request that the attorney general evaluate the policies
and practices of the inspector general to ensure that the inspector
general complies with professional standards and nationally
accepted policies and practices.
Sec. 2115.203. ALLEGATIONS OF MISCONDUCT AGAINST PRESIDING
OFFICER. If allegations that a presiding officer has engaged in
misconduct result in a review by an inspector general, the
inspector general shall report to the governor during the review
until the report is completed or the review is closed without a
finding.
Sec. 2115.204. PERIODIC REPORTING TO STATE AUDITOR
REQUIRED. An inspector general shall timely inform the state
auditor of the initiation of a review and the ongoing status of each
review.
Sec. 2115.205. REPORTING OFFICE FINDINGS. An inspector
general shall report the findings of the inspector general's office
to:
(1) the presiding officer of the inspector general's
agency;
(2) the governor;
(3) the lieutenant governor;
(4) the speaker of the house of representatives;
(5) the state auditor's office; and
(6) appropriate law enforcement and prosecutorial
agencies, including the office of the attorney general, if the
findings relate to a criminal investigation.
Sec. 2115.206. FLAGRANT VIOLATIONS; IMMEDIATE REPORT. An
inspector general shall immediately report to the presiding officer
of the inspector general's agency, the governor's general counsel,
and the state auditor a particularly serious or flagrant problem
relating to the administration of a program or operation of the
agency or interference with an inspector general operation.
[Sections 2115.207-2115.250 reserved for expansion]
SUBCHAPTER F. PUBLIC RECORDS; EXCEPTIONS
Sec. 2115.251. INFORMATION CONFIDENTIAL. (a) Except as
provided by this section, Sections 2115.160 and 2115.252, and
Subchapter E, all information and material compiled by an inspector
general during a review under this chapter is:
(1) confidential and not subject to disclosure under
Chapter 552; and
(2) not subject to disclosure, discovery, subpoena, or
other means of legal compulsion for release to anyone other than the
state auditor's office, or the inspector general's office or its
agents involved in the review related to that information or
material.
(b) As an inspector general determines appropriate,
information relating to a review may be disclosed to:
(1) a law enforcement agency;
(2) the attorney general; or
(3) the state auditor's office.
(c) A person that receives information under Subsection (b)
may not disclose the information except to the extent that
disclosure is consistent with the authorized purpose for which the
person first obtained the information.
Sec. 2115.252. FINAL REVIEW REPORTS. (a) An inspector
general shall prepare a final report for each review conducted
under this chapter. The final report must include:
(1) a summary of the activities performed by the
inspector general in conducting the review;
(2) a determination of whether wrongdoing was found;
and
(3) a description of any findings of wrongdoing.
(b) An inspector general's final review reports are subject
to disclosure under Chapter 552.
(c) All working papers and other documents related to
compiling the final review reports remain confidential and are not
subject to disclosure under Chapter 552.
[Sections 2115.253-2115.300 reserved for expansion]
SUBCHAPTER G. STATE AUDITOR AND INSPECTOR GENERAL INDEPENDENCE
Sec. 2115.301. STATE AUDITOR AUDITS, INVESTIGATIONS, AND
ACCESS TO INFORMATION NOT IMPAIRED. This chapter or other law
related to the operation of an inspector general does not prohibit
the state auditor from conducting an audit or an investigation or
other review or from having full and complete access to all records
and other information, including witnesses and electronic data,
that the state auditor considers necessary for the audit or the
investigation or other review.
Sec. 2115.302. ACCESS TO STATE AUDITOR INFORMATION NOT
IMPAIRED. Except as authorized by the state auditor, this chapter
or other law related to the operation of an inspector general does
not permit an inspector general or any other person to access any
working papers, including any documents, notes, and other
information, collected or maintained by the state auditor's office.
Sec. 2115.303. AUTHORITY OF STATE AUDITOR TO CONDUCT AUDITS
NOT IMPAIRED. This chapter or other law related to the operation of
an inspector general does not take precedence over the authority of
the state auditor to conduct an audit under Chapter 321 or other
law.
[Sections 2115.304-2115.350 reserved for expansion]
SUBCHAPTER H. FINANCIAL PROVISIONS
Sec. 2115.351. BUDGET. An inspector general shall submit a
budget to the presiding officer of the inspector general's agency.
Sec. 2115.352. COSTS. (a) An inspector general shall
maintain information regarding the cost of reviews.
(b) An inspector general may cooperate with appropriate
administrative and prosecutorial agencies, including the office of
the attorney general, in recovering costs incurred under this
chapter from nongovernmental entities, including contractors or
individuals involved in:
(1) violations of state and federal rules or statutes;
or
(2) abusive or wilful misconduct.
SECTION 2. Subsections (a), (b), and (h), Section 531.102,
Government Code, are amended to read as follows:
(a) In this section, "office" means [The commission,
through] the commission's office of inspector general established
under Chapter 2115[, is responsible for the investigation of fraud
and abuse in the provision of health and human services and the
enforcement of state law relating to the provision of those
services. The commission may obtain any information or technology
necessary to enable the office to meet its responsibilities under
this subchapter or other law].
(b) The [commission, in consultation with the] inspector
general for the commission[,] shall set clear objectives,
priorities, and performance standards for the office that
emphasize[:
[(1) coordinating investigative efforts to
aggressively recover money;
[(2) allocating resources to cases that have the
strongest supportive evidence and the greatest potential for
recovery of money; and
[(3)] maximizing opportunities for referral of cases
to the office of the attorney general in accordance with Section
531.103.
(h) In addition to performing functions and duties
otherwise provided by law, the office may:
(1) assess administrative penalties otherwise
authorized by law on behalf of the commission or a health and human
services agency;
(2) request that the attorney general obtain an
injunction to prevent a person from disposing of an asset
identified by the office as potentially subject to recovery by the
office due to the person's fraud or abuse;
(3) provide for coordination between the office and
special investigative units formed by managed care organizations
under Section 531.113 or entities with which managed care
organizations contract under that section;
(4) audit the use and effectiveness of state or
federal funds, including contract and grant funds, administered by
a person or state agency receiving the funds from a health and human
services agency; and
(5) conduct investigations relating to the funds
described by Subdivision (4)[; and
[(6) recommend policies promoting economical and
efficient administration of the funds described by Subdivision (4)
and the prevention and detection of fraud and abuse in
administration of those funds].
SECTION 3. Subsections (a-1), (d), and (e), Section
531.102, and 531.1021, Government Code, are repealed.
SECTION 4. (a) The repeal by this Act of certain
provisions of Section 531.102, Government Code, does not affect the
validity of a complaint, investigation, or other proceeding
initiated under that section before the effective date of this Act.
A complaint, investigation, or other proceeding initiated under
that section is continued in accordance with the changes in law made
by this Act.
(b) The repeal by this Act of Section 531.1021, Government
Code, does not affect the validity of a subpoena issued under that
section before the effective date of this Act. A subpoena issued
under that section before the effective date of this Act is governed
by the law that existed when the subpoena was issued, and the former
law is continued in effect for that purpose.
SECTION 5. (a) The repeal by this Act of Subsection (a-1),
Section 531.102, Government Code, does not affect the entitlement
of the person appointed as inspector general under that subsection
to serve out the remainder of the person's term and carry out the
functions of an inspector general in the same manner as an inspector
general appointed under Chapter 2115, Government Code, as added by
this Act, for the remainder of the person's term.
(b) This section does not prohibit a person described by
Subsection (a) of this section from being appointed under Chapter
2115, Government Code, as added by this Act, if the person has the
qualifications required under that chapter.
(c) As soon as possible after the term under Section
531.102, Government Code, expires or after the office of inspector
general otherwise becomes vacant at an earlier date, the governor
shall appoint an inspector general for the Health and Human
Services Commission under Chapter 2115, Government Code, as added
by this Act, to an initial term expiring February 1, 2007.
SECTION 6. As soon as possible after the effective date of
this Act, the governor shall appoint an inspector general for each
agency other than the Health and Human Services Commission listed
in Section 2115.002, Government Code, as added by this Act, to an
initial term expiring February 1, 2007.
SECTION 7. This Act takes effect September 1, 2005.
* * * * *