By: Uresti  S.B. No. 871
         (In the Senate - Filed February 23, 2007; March 7, 2007,
  read first time and referred to Committee on Health and Human
  Services; April 2, 2007, reported adversely, with favorable
  Committee Substitute by the following vote:  Yeas 9, Nays 0;
  April 2, 2007, sent to printer.)
 
  COMMITTEE SUBSTITUTE FOR S.B. No. 871 By:  Uresti
 
 
A BILL TO BE ENTITLED
 
AN ACT
 
  relating to the enforcement of civil penalties against certain
  assisted living facilities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 247.045, Health and Safety Code, is
  amended by amending Subsections (d) and (e) and adding Subsections
  (h) and (i) to read as follows:
         (d)  The attorney general may institute and conduct a suit to
  collect a penalty and fees under this section at the request of the
  department.  If the attorney general fails to notify the department
  [take action] within 30 days of referral from the department that
  the attorney general will accept the case, the department shall
  refer the case to the local district attorney, county attorney, or
  city attorney. The district attorney, county attorney, or city
  attorney shall file suit in a district court to collect and retain
  the penalty.
         (e)  Investigation and attorney's fees may not be assessed or
  collected by or on behalf of the department or other state agency
  unless [the department or other state agency assesses and collects]
  a penalty described under this chapter is assessed.
         (h)  If a person who is liable under this section fails to pay
  any amount the person is obligated to pay under this section, the
  state may seek satisfaction from any owner, other controlling
  person, or affiliate of the person found liable. The owner, other
  controlling person, or affiliate may be found liable in the same
  suit or in another suit on a showing by the state that the amount to
  be paid has not been paid or otherwise legally discharged. The
  department by rule may establish a method for satisfying an
  obligation imposed under this section from an insurance policy,
  letter of credit, or other contingency fund.
         (i)  In this section, "affiliate" means:
               (1)  with respect to a partnership other than a limited
  partnership, each partner of the partnership;
               (2)  with respect to a corporation:
                     (A)  an officer;
                     (B)  a director;
                     (C)  a stockholder who owns, holds, or has the
  power to vote at least 10 percent of any class of securities issued
  by the corporation, regardless of whether the power is of record or
  beneficial; and
                     (D)  a controlling individual;
               (3)  with respect to an individual:
                     (A)  each partnership and each partner in the
  partnership in which the individual or any other affiliate of the
  individual is a partner; and
                     (B)  each corporation or other business entity in
  which the individual or another affiliate of the individual is:
                           (i)  an officer;
                           (ii)  a director;
                           (iii)  a stockholder who owns, holds, or has
  the power to vote at least 10 percent of any class of securities
  issued by the corporation, regardless of whether the power is of
  record or beneficial; and
                           (iv)  a controlling individual;
               (4)  with respect to a limited partnership:
                     (A)  a general partner; and
                     (B)  a limited partner who is a controlling
  individual;
               (5)  with respect to a limited liability company:
                     (A)  an owner who is a manager as described by the
  Texas Limited Liability Company Act (Article 1528n, Vernon's Texas
  Civil Statutes); and
                     (B)  each owner who is a controlling individual;
  and
               (6)  with respect to any other business entity, a
  controlling individual.
         SECTION 2.  The change in law made by this Act applies only
  to a violation that occurs on or after the effective date of this
  Act. A violation occurs before the effective date of this Act if
  any element of the violation occurs before that date. A violation
  that occurs before the effective date of this Act is covered by the
  law in effect when the violation occurred, and the former law is
  continued in effect for that purpose.
         SECTION 3.  This Act takes effect September 1, 2007.
 
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