BILL ANALYSIS

 

 

 

S.B. 783

By: Shapiro

Technology, Economic Development & Workforce

Committee Report (Unamended)

 

 

 

BACKGROUND AND PURPOSE

 

The Office of the Governor is struggling to keep up with the number of applications being considered and awards already granted from the Texas emerging technology fund. Currently, the governor's office is not required to create a report on the fund and its dealings and performance, and this lack of reporting disallows legislative oversight.

 

Further, the governor's office is not able to contract with an outside entity to assist in applications and award offerings, so the only option for handling the ever-increasing workload is to expand the office to include more employees. Current law does not allow money from the fund to be used to attract research superiority from non-educational facilities.

 

S.B. 783 requires the Texas Emerging Technology Advisory Committee to review and consider proposals by public institutions of higher education for attracting existing research superiority from entities other than institutions of higher education, whether those entities are located in or outside of Texas. The bill authorizes the governor to contract with an outside entity to assist in the negotiation and drafting of contracts between the governor and a recipient of an award from the Texas emerging technology fund and to perform certain other functions in connection with the fund. The bill requires the governor to submit an annual report on the fund to the Legislative Budget Board and to notify each member of the legislature by electronic mail when a new report is posted on the office of the governor's Internet website.

RULEMAKING AUTHORITY

 

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

 

S.B. 783 transfers and renumbers Section 490.057, Government Code, and amends it to apply to information in any form provided by or on behalf of an individual or entity being considered for an award from the Texas emerging technology fund or a recipient of an award from the fund, including information contained in, accompanying, or derived from any application, and other commercially or academically sensitive information collected by the governor's office, the Texas Emerging Technology Advisory Committee, or the committee's advisory panels from an individual or entity being considered for an award from the fund. The bill establishes that the information described above that is collected, assembled, or maintained by or for the governor, the lieutenant governor, the speaker of the house of representatives, the advisory committee, or the committee's advisory panel is confidential and may not be disclosed under the Public Information Act.

 

S.B. 783 requires any application for an award from the fund that is withdrawn by the applicant before the award is made or that is denied to be returned to the applicant promptly on request, together with all materials submitted by or on behalf of the applicant that relate to the application. The bill makes an exception for a record of the submission and disposition of the application that does not include any information described above, allowing such a record to be retained. The bill requires the governor's office, not later than the 10th business day after the date a contract for an award from the fund is entered into under applicable law, to prepare a summary of the contract and make the summary available to the public. The bill requires the summary to include the award recipient's name and address, the amount of funding applied for, and the type of emerging technology to which the award relates and prohibits the summary from including any confidential information.

 

S.B. 783 authorizes the governor to contract with an outside entity to assist in the negotiation and drafting of contracts between the governor and a recipient of an award from the Texas emerging technology fund; oversee outstanding awards and monitor compliance with an award contract; evaluate the fund's investment portfolio; advise the office of the governor regarding the value and performance of the investment portfolio; and assist the governor in preparing the annual report described below. The bill authorizes a contract between the governor and an outside entity to provide for the outside entity to receive compensation from the fund each year. The bill requires the outside entity to have substantial experience in evaluating institutional investment practices and performance in order to evaluate fund investment practices and performance. The bill defines "investment portfolio" for purposes of these provisions and the provisions described below.

 

S.B. 783 requires the governor, not later than January 1 of each year, to submit to the Legislative Budget Board and post on the office of the governor's Internet website a report that includes the following information regarding the Texas emerging technology fund for the preceding state fiscal year:

  • the total number and amount of awards made;
  • the number and amount of awards made under the programs for incentives for commercialization activity, research award matching, and acquisition of research superiority;
  • the name of each award recipient, the recipient's organizational structure, and the amount of the awards made to the recipient;
  • the total amount of funds received by each recipient from any source for a project that receives an award under the fund component relating to incentives for commercialization activities, including the amount awarded to the recipient from the fund, the total amount of any funds received by the recipient from the private sector, and the amount of any federal grants or loans received by the recipient;
  • a brief description of the investments that constitute the fund's investment portfolio as of the end of that reporting period; and
  • the total value of the fund's investment portfolio as of the end of that reporting period.

 

S.B. 783 requires the annual report to also include aggregate information regarding the planned and actual outcomes resulting from awards made from the fund during the preceding two state fiscal years. The bill prohibits the governor from disclosing in the report the name of any person in the private sector that invests in a project receiving an award under the fund component relating to incentives for commercialization activities. The bill requires the governor to notify each member of the legislature by electronic mail when a new report required by these provisions is posted on the Internet website of the office of the governor. The bill requires the notification to be sent to the electronic mail address provided to the member as a legislator and to contain an electronic copy of the report or an electronic link to the report on the website. The bill requires the governor to submit the initial report required by these provisions not later than January 1, 2011.

 

S.B. 783 adjusts the allocation of money appropriated to the Texas emerging technology fund by the legislature, less amounts necessary to administer the fund as provided by law. The bill requires 60, rather than 50, percent of the money to be allocated for incentives for collaboration between certain entities under the fund component relating to incentives for commercialization activities; 10, rather than 16.67, percent of the money to be allocated for research award matching under the fund component relating to that purpose; and 30, rather than 33.33, percent to be allocated for acquisition of research superiority under the fund component relating to that purpose.

 

S.B. 783 prohibits the governor, notwithstanding any other law, including an appropriations act, from making an award or other transfer otherwise authorized by law from the Texas emerging technology fund to the Texas Enterprise Fund for purposes of making a grant or other expenditure from the Texas Enterprise Fund; or making a grant or transfer otherwise authorized by law from the Texas Enterprise Fund to the Texas emerging technology fund for purposes of making an award or other expenditure from the Texas emerging technology fund, without the prior written approval of the Legislative Budget Board.

 

S.B. 783 adds proposals for attracting existing research superiority from entities other than institutions of higher education, whether those entities are located in or outside of Texas, to the proposals by public institutions of higher education that the Texas Emerging Technology Advisory Committee is required to review and consider. The bill also adds proposals for enhancing existing research superiority by attracting additional researchers and resources from entities other than institutions of higher education, whether those entities are located in or outside Texas, to those proposals. The bill adds language to specify that other proposals that the committee is required to review and consider relate to institutions of higher education outside Texas.     

 

EFFECTIVE DATE

 

On passage, or, if the act does not receive the necessary vote, the act takes effect September 1, 2009.