By: Zaffirini S.B. No. 5

A BILL TO BE ENTITLED

AN ACT

relating to public institutions of higher education, including the administration, operation, financial management, and reporting requirements of those institutions.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

ARTICLE 1. FINANCIAL MANAGEMENT

SECTION 1.01. Section 51.003(b), Education Code, is amended to read as follows:

(b) The funds shall either be deposited in the depository bank or banks or invested as authorized by Chapter 2256, Government Code (Public Funds Investment Act). Funds that are to be deposited in the depository bank or banks must be deposited within seven days from the date of receipt by the institution [collection].

SECTION 1.02. Subchapter A, Chapter 51, Education Code, is amended by adding Sections 51.010 and 51.011 to read as follows:

Sec. 51.010. COLLECTION OF DELINQUENT OBLIGATIONS. If under the rules adopted by the attorney general under Chapter 2107, Government Code, an institution of higher education is not required to refer a delinquent obligation for collection to the attorney general, the institution is not required to expend resources for further collection efforts if, considering the amount, security, likelihood of collection, expense, and available resources, the institution determines that further collection should not be actively pursued.

Sec. 51.011. DISPOSITION OF SMALL CREDIT BALANCES. (a) This section applies to a credit balance of less than $25 held by an institution of higher education that is presumed abandoned under Chapter 72, Property Code.

(b) An institution of higher education may maintain an unclaimed money fund and transfer to that fund a credit balance to which this section applies. The institution shall hold and account for the fund as educational and general funds of the institution.

(c) The institution shall use the unclaimed money fund to pay the claims of persons establishing ownership of amounts transferred to the fund. Each fiscal year, after retaining money in the fund sufficient to pay anticipated expenses of and claims against the fund, the institution shall use the balance as other educational and general funds of the institution.

(d) In consultation with institutions of higher education, the comptroller by rule may establish minimum requirements for notice to owners of unclaimed money deposited in the unclaimed money fund and for charges for that notice. The rules may not provide stricter requirements than the comptroller applies for amounts of less than $25 in the custody of the comptroller under Chapter 74, Property Code.

(e) If an institution of higher education maintains an unclaimed money fund under this section, Chapter 74, Property Code, does not apply to a credit balance to which this section applies.

SECTION 1.03. Section 65.42, Education Code, is amended to read as follows:

Sec. 65.42. DELINQUENT ACCOUNTS; VENUE. A suit by The University of Texas System on its own behalf or on behalf of a component institution of The University of Texas System to recover a delinquent loan, account, or debt owed to The University of Texas System or a component institution of The University of Texas System must [may] be brought in Travis County.

SECTION 1.04. Section 1231.001, Government Code, is amended by amending Subdivision (2) and adding Subdivision (3) to read as follows:

(2) "State security" means:

(A) an obligation, including a bond, issued by:

(i) a state agency;

(ii) an entity that is expressly created by statute and has statewide jurisdiction; or

(iii) an entity issuing the obligation on behalf of this state or on behalf of an entity described by Subparagraph (i) or (ii);

(B) an installment sale or lease-purchase obligation that is issued by or on behalf of an entity described by Paragraph (A) and that has:

(i) a stated term of more than five years; or

(ii) an initial principal amount of more than $250,000; or

(C) an obligation, including a bond, that is issued under Chapter 53, Education Code, at the request of or for the benefit of an institution of higher education [as defined by Section 61.003, Education Code,] other than a public junior college.

(3) "Institution of higher education" has the meaning assigned by Section 61.003, Education Code.

SECTION 1.05. Section 1231.041, Government Code, is amended to read as follows:

Sec. 1231.041. APPROVAL OF STATE SECURITY. (a) Except as otherwise provided by this section, an [An] entity, including a state agency, may not issue a state security unless:

(1) the board approves the issuance; or

(2) the security is exempted under law, including a board rule adopted under Section 1231.022(2).

(b) A state security issued by an institution of higher education, or issued at the request of or for the benefit of an institution of higher education, is not subject to board approval unless the general revenue of the state is pledged to the payment of the security.

SECTION 1.06. Section 74.001, Property Code, is amended by adding Subsection (c) to read as follows:

(c) This chapter does not apply to small credit balances held by an institution of higher education in an unclaimed money fund under Section 51.011, Education Code.

SECTION 1.07. Section 51.011, Education Code, as added by this Act, applies to credit balances held by a public institution of higher education on or after the effective date of this Act.

ARTICLE 2. GOODS AND SERVICES

SECTION 2.01. Section 51.923, Education Code, is amended to read as follows:

Sec. 51.923. QUALIFICATIONS OF CERTAIN BUSINESS ENTITIES TO ENTER INTO CONTRACTS WITH AN INSTITUTION OF HIGHER EDUCATION. (a) In this section:

(1) "Business entity" ["Corporation"] means any entity recognized by law through which business is conducted, including a sole proprietorship, partnership, firm, corporation, limited liability company, holding company, joint stock company, receivership, or trust [a corporation for profit organized under the laws of this state or under laws other than the laws of this state].

(2) "Governing board" has the meaning assigned by Section 61.003 [of this code].

(3) "Institution of higher education" has the meaning assigned by Section 61.003 [of this code].

(4) "Nonprofit corporation" means any organization exempt from federal income tax under Section 501 of the Internal Revenue Code of 1986 that does not distribute any part of its income to any member, director, or officer.

(b) A nonprofit corporation is not disqualified from entering into a contract or other transaction with an institution of higher education even though one or more members of the governing board of the institution of higher education also serves as a member, [or] director, officer, or employee of the nonprofit corporation.

(c) A business entity [corporation] is not disqualified from entering into a contract or other transaction with an institution of higher education even though one or more members of the governing board of the institution of higher education have an interest in the business entity, subject to Subsection (d) [also serves as a stockholder or director of the corporation provided that no member of the governing board owns or has a beneficial interest in more than five percent of the corporation's outstanding capital stock and further provided that the contract or transaction is:

[(1) an affiliation, licensing, or sponsored research agreement; or

[(2) awarded by competitive bidding or competitive sealed proposals].

(d) An institution of higher education is not prohibited from entering into a contract or other transaction with a business entity in which a member of the governing board of the institution of higher education has an interest if the interest is not a substantial interest or, if the interest is a substantial interest, the [described in this section if any] board member [having an interest described in this section in the contract or transaction] discloses that interest in a meeting held in compliance with Chapter 551, Government Code, and refrains from voting on the contract or transaction requiring board approval. Any such contract or transaction requiring board approval must be approved by an affirmative majority of the board members voting on the contract or transaction.

(e) For purposes of this section, a member of a governing board has a substantial interest in a business entity if:

(1) the member owns 10 percent or more of the voting stock or shares of the business entity or owns either 10 percent or more or $15,000 or more of the fair market value of the business entity;

(2) funds received by the member from the business entity exceed 10 percent of the member's gross income for the previous year;

(3) the member is an officer of the business entity or a member of the governing board of the business entity; or

(4) an individual related to the member in the first degree by consanguinity or affinity, as determined under Chapter 573, Government Code, has an interest in the business entity as described by Subdivision (1), (2), or (3).

(f) A violation of this section does not render an action of the governing board voidable unless the contract or transaction that was the subject of the action would not have been approved by the governing board without the vote of the member who violated this section.

SECTION 2.02. Section 51.9335, Education Code, is amended by amending Subsections (d), (e), and (f) and adding Subsections (g) and (h) to read as follows:

(d) To the extent of any conflict, this section prevails over any other law, including Chapters 2155, 2156, 2157, 2158, 2167, and 2170, Government Code, except a law or rule relating to contracting with historically underutilized businesses [or relating to the procurement of goods and services from persons with disabilities]. An institution of higher education may, but is not required to, acquire goods or services as provided by Chapters 2155, 2156, 2157, 2158, 2167, and 2170, Government Code.

(e) In this section, "institution of higher education" has the meaning assigned by Section 61.003 and includes a school of veterinary medicine and a health care facility operated by a medical and dental unit, except that the term does not include [The University of Texas M. D. Anderson Cancer Center or] a public junior college.

(f) Except as otherwise provided by this section, Subtitle D, Title 10, Government Code, and Chapter 2254, Government Code, do [This section does] not apply to purchases of goods and services under this section [professional services as defined by Section 2254.002, Government Code].

(g) An institution of higher education may adopt rules and procedures for the acquisition of goods or services.

(h) In any contract for the acquisition of goods and services to which an institution of higher education is a party, a provision required by applicable law to be included in the contract is considered to be a part of the executed contract without regard to:

(1) whether the provision appears on the face of the contract; or

(2) whether the contract includes any provision to the contrary.

SECTION 2.03. Subchapter Z, Chapter 51, Education Code, is amended by adding Sections 51.9336, 51.9337, and 51.9338 to read as follows:

Sec. 51.9336. ELECTRONIC SIGNATURES. (a) An institution of higher education or university system, as those terms are defined by Section 61.003, shall determine whether, and the extent to which, the institution or system will send and accept electronic signatures to and from other persons and otherwise create, generate, communicate, store, process, use, and rely on electronic signatures. The institution or system may adopt rules and procedures governing the use of electronic signatures.

(b) To the extent of any conflict, this section prevails over Chapter 322, Business & Commerce Code, and rules and guidelines adopted under that chapter.

Sec. 51.9338. INTERAGENCY CONTRACTS FOR INFORMATION RESOURCE TECHNOLOGIES. (a) In this section, "institution of higher education" and "university system" have the meanings assigned by Section 61.003.

(b) Section 2054.119, Government Code, does not apply to an interagency contract for information resources technologies between two or more institutions of higher education or between an institution of higher education or university system and one or more state agencies, institutions of higher education, or university systems.

SECTION 2.04. Section 51.966, Education Code, is amended by amending Subsection (c) and adding Subsection (d) to read as follows:

(c) Section 612.002, Government Code, does not apply to an institution of higher education or university system purchasing insurance under this section.

(d) In [As used in] this section, "governing board," [and] "institution of higher education," and "university system" have the meanings assigned by Section 61.003.

SECTION 2.05. Section 153.006(a), Education Code, is amended to read as follows:

(a) In order to carry out the purposes of this chapter and to support the activities of centers described in this chapter, to the extent authorized by its governing board, an institution of higher education may:

(1) enter into agreements establishing royalties, fees, and other consideration for technology developed in whole or part by it;

(2) accept equity interests in organizations that license, manage, or otherwise administer rights to technology belonging to it or under its control in exchange for such rights, in whole or in part;

(3) accept equity interests in organizations that license or otherwise have rights in its technology as consideration for its providing monetary, business, scientific, or engineering services or technical assistance;

(4) use income from the commercialization of technology to fund the activities of the center;

(5) solicit, accept, and administer gifts, grants, and donations;

(6) without the necessity of approval by the attorney general under Section 402.0212, Government Code, or other law, enter into contracts for legal services with a competent lawyer or law firm to:

(A) prepare, file, pursue, and maintain patent applications in the United States or foreign jurisdictions;

(B) secure copyright protection for computer software;

(C) prepare, file, and pursue trademark and service mark applications;

(D) pursue litigation to prevent or stop infringement of any intellectual property rights of the institution; or

(E) handle any other legal matter related to the operation and activities of the center; and

(7) enter into such other business arrangements as may be appropriate for achieving the purposes of this chapter.

SECTION 2.06. Section 402.0212, Government Code, is amended by adding Subsection (d) to read as follows:

(d) The attorney general may review and approve a standard form contract of a university system or institution of higher education for the procurement of legal services to be provided to the system or institution. If the attorney general approves a standard form, the attorney general is not required under this section to approve individual contracts that are in substantial compliance with the approved form or to approve invoices under those contracts. The attorney general may conduct an annual review of the approved standard form and any signed contracts using that form, and for that purpose may collect a fee, established in consultation with the university system or institution of higher education, reasonably estimated to cover the expenses of that review. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 2.07. Subchapter C, Chapter 791, Government Code, is amended by adding Section 791.035 to read as follows:

Sec. 791.035. CONTRACTS WITH INSTITUTIONS OF HIGHER EDUCATION OR UNIVERSITY SYSTEMS. (a) A local government and an institution of higher education or university system may contract with one another to perform any governmental functions and services. If the terms of the contract provide for payment based on cost recovery, any law otherwise requiring competitive procurement does not apply to the functions and services covered by the contract.

(b) In this section, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 2.08. Section 2107.003(e), Government Code, is amended to read as follows:

(e) Except as provided by Section 2254.110, a [A] person awarded a contract under Subsection (b), (c), or (c-1) may not file suit or otherwise pursue judicial action to collect the obligation owed in a court of this state or another state on behalf of the contracting state agency.

SECTION 2.09. Section 2155.078(n), Government Code, is amended to read as follows:

(n) This section does not apply to an institution [a medical and dental unit] to which Section 51.9335, Education Code, applies or to an institution to which Section 73.115, Education Code, applies.

SECTION 2.10. Section 2254.102(c), Government Code, is amended to read as follows:

(c) This subchapter does not apply to a contract:

(1) with a state agency to collect an obligation under Section 2107.003(b), (c), or (c-1), except as provided by Section 2254.110; or

(2) for legal services entered into by an institution of higher education under Section 153.006, Education Code.

SECTION 2.11. Subchapter C, Chapter 2254, Government Code, is amended by adding Section 2254.110 to read as follows:

Sec. 2254.110. COLLECTION ACTION BY INSTITUTION OF HIGHER EDUCATION. (a) In this section, "institution of higher education" has the meaning assigned by Section 61.003.

(b) A person awarded a contract under Chapter 2107 by an institution of higher education for a routine collection matter may file suit or otherwise pursue judicial action to collect the obligation owed in a court of this state or another state on behalf of the institution.

SECTION 2.12. Section 31.401, Natural Resources Code, is amended by amending Subsections (a) and (d) and adding Subsection (b-1) to read as follows:

(a) Except as otherwise provided by Subsection (b-1), the [The] land office shall review and must approve any contract entered into by a state agency for the acquisition of an annual average of 100 MCF per day or more of natural gas used to meet its energy requirements.

(b-1) A contract described by Subsection (a) entered into by an institution of higher education or university system is not required to be reviewed or approved by the land office, but on request of the land office the institution or system shall provide a copy of the executed contract to the land office.

(d) In this section:

(1) "Institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

(2) "State [, "state] agency" has the meaning assigned by Subchapter A, Chapter 572, Government Code.

SECTION 2.13. Section 36.351, Utilities Code, is amended by adding Subsection (h) to read as follows:

(h) This section has been in full force and effect from original enactment. Section 63, Chapter 405, Acts of the 76th Legislature, Regular Session, 1999, did not provide for the expiration of this section and does not excuse a transmission and distribution company, or any other electric utility, from providing the discounts required by this section.

SECTION 2.14. Section 58.251, Utilities Code, is amended by adding Subsection (a-1) to read as follows:

(a-1) "Institution of higher education" has the meaning assigned by Section 61.003, Education Code.

SECTION 2.15. Section 58.258(a), Utilities Code, is amended to read as follows:

(a) Notwithstanding the pricing flexibility authorized by this subtitle, an electing company's rates for private network services may not be increased before January 1, 2012, or, for services provided to an institution of higher education, before January 1, 2023. However, an electing company may increase a rate in accordance with the provisions of a customer specific contract.

SECTION 2.16. Section 58.268, Utilities Code, is amended to read as follows:

Sec. 58.268. CONTINUATION OF OBLIGATION. Notwithstanding any other provision of this title, an electing company shall continue to comply with this subchapter until January 1, 2012, or, with respect to services provided to an institution of higher education, until September 1, 2023, regardless of:

(1) the date the company elected under this chapter; or

(2) any action taken in relation to that company under Chapter 65.

SECTION 2.17. Section 59.071, Utilities Code, is amended by adding Subdivision (1-a) to read as follows:

(1-a) "Institution of higher education" has the meaning assigned by Section 61.003, Education Code.

SECTION 2.18. Section 59.077(a), Utilities Code, is amended to read as follows:

(a) Notwithstanding the pricing flexibility authorized by this subtitle, an electing company's rates for private network services may not be increased before January 1, 2012, or, for services provided to an institution of higher education, before September 1, 2023.

SECTION 2.19. Section 59.083, Utilities Code, is amended to read as follows:

Sec. 59.083. CONTINUATION OF OBLIGATION. Notwithstanding any other provision of this title, an electing company shall continue to comply with this subchapter until January 1, 2012, or, with respect to services provided to an institution of higher education, before September 1, 2023, regardless of:

(1) the date the company elected under this chapter; or

(2) any action taken in relation to that company under Chapter 65.

ARTICLE 3. HUMAN RESOURCES

SECTION 3.01. Subchapter Z, Chapter 51, Education Code, is amended by adding Section 51.9611 to read as follows:

Sec. 51.9611. PAYROLL DEDUCTIONS FOR EMPLOYEES OF UNIVERSITY SYSTEM OR INSTITUTION OF HIGHER EDUCATION. (a) In this section, "institution of higher education" and "university system" have the meanings assigned by Section 61.003.

(b) The governing board of a university system, or of an institution of higher education that is not a component institution of a university system, may authorize employees of the system or institution, as applicable, to elect a payroll deduction for any purpose that the governing board determines serves a public purpose and benefits employees. The board may adopt policies and procedures governing payroll deductions under this section. A payroll deduction under this section is in addition to payroll deductions authorized by other law.

(c) A payroll deduction under this section must be at the written request of the employee, and the request must state the amount to be deducted and the entity to which the deducted amount is to be transferred. A payroll deduction is in effect until revoked in writing by the employee, but the policies and procedures of the system or institution, as applicable, may provide for enrollment periods.

(d) A system or institution may collect an administrative fee to cover the costs of making a deduction.

SECTION 3.02. Section 1601.004(a), Insurance Code, is amended to read as follows:

(a) In this chapter, "dependent," with respect to an individual eligible to participate in the uniform program under Section 1601.101 or 1601.102, means the individual's:

(1) spouse;

(2) unmarried child younger than 25 years of age; and

(3) child of any age who the system determines lives with or has the child's care provided by the individual on a regular basis if the child is mentally retarded or physically incapacitated to the extent that the child is dependent on the individual for care or support, as determined by the system, and:

(A) if the child is at least 25 years of age, the child's coverage under this chapter has not lapsed, and the child was enrolled as a participant in the health benefits coverage under the uniform program on the date of the child's 25th birthday; or

(B) if the child is a child of an individual eligible to participate as an employee under Section 1601.101, at the time of the individual's initial enrollment in health benefits coverage under the uniform program the child is at least 25 years of age and is enrolled in comparable coverage, as determined by the system, under the individual's previous health benefits coverage.

SECTION 3.03. Subchapter C, Chapter 1601, Insurance Code, is amended by adding Section 1601.111 to read as follows:

Sec. 1601.111. PROGRAMS PROMOTING DISEASE PREVENTION, WELLNESS, AND HEALTH. A system may establish premium discounts, surcharges, rebates, or a revision in otherwise applicable copayments, coinsurance, or deductibles, or any combination of those incentives, for an individual who participates in system-approved programs promoting disease prevention, wellness, and health.

ARTICLE 4. REAL ESTATE AND CONSTRUCTION

SECTION 4.01. Section 51.951(a), Education Code, is amended to read as follows:

(a) Information related to the development, location, purchase price, or sale price of real property developed, purchased, or sold by or for an institution of higher education, as defined by Section 61.003, including a contract provision related to the development, purchase, or sale of the property, is confidential and exempt from disclosure under Chapter 552, Government Code, until all deeds for the property that are applicable to the transaction or series of related transactions are executed and until all substantive performance or executor requirements of applicable contracts have been satisfied [a deed for the property is executed]. Information that is confidential and exempted from disclosure under this subsection includes an appraisal, completed report, evaluation, investigation conducted for the purpose of locating or determining the purchase or sale price of the property, or any report prepared in anticipation of purchasing or selling real property.

SECTION 4.02. Sections 61.0572(b), (d), and (e), Education Code, are amended to read as follows:

(b) The board shall:

(1) determine formulas for space utilization in all educational and general buildings and facilities at institutions of higher education;

(2) devise and promulgate methods to assure maximum daily and year-round use of educational and general buildings and facilities, including but not limited to maximum scheduling of day and night classes and maximum summer school enrollment;

(3) consider plans for selective standards of admission when institutions of higher education approach capacity enrollment;

(4) require, and assist the public technical institutes, public senior colleges and universities, medical and dental units, and other agencies of higher education in developing long-range campus master plans for campus development; and

(5) [endorse, or delay until the next succeeding session of the legislature has the opportunity to approve or disapprove, the proposed purchase of any real property by an institution of higher education, except a public junior college;

[(6) develop and publish standards, rules, and regulations to guide the institutions and agencies of higher education in making application for the approval of new construction and major repair and rehabilitation of all buildings and facilities regardless of proposed use; and

[(7)] ascertain that the standards and specifications for new construction, repair, and rehabilitation of all buildings and facilities are in accordance with Article 9102, Revised Statutes.

(d)[(1)] The board[, for purposes of state funding,] may review purchases of [and approve as an addition to an institution's educational and general buildings and facilities inventory any] improved real property added to an institution's educational and general buildings and facilities inventory [acquired by gifts or lease-purchase only if:

[(A) the institution requests to place the improved real property on its educational and general buildings and facilities inventory; and

[(B) the value of the improved real property is more than $300,000 at the time the institution requests the property to be added to the educational and general buildings and facilities inventory.

[(2) This subsection does not apply to gifts, grants, or lease-purchase arrangements intended for clinical or research facilities.

[(e) Approval of the board is not required to acquire real property that is financed by bonds issued under Section 55.17(e)(3) or (4), 55.1713-55.1718, 55.1721-55.1728, 55.1735(a)(1), 55.174, 55.1742, 55.1743, 55.1744, 55.1751-55.17592, 55.1768, 55.1771, or 55.17721, except that the board shall review all real property to be financed by bonds issued under those sections] to determine whether the property meets the standards adopted by the board for cost, efficiency, and space use, but the purchase of the improved real property is not contingent on board approval. If the property does not meet those standards, the board shall notify the governor, the lieutenant governor, the speaker of the house of representatives, and the Legislative Budget Board.

SECTION 4.03. Sections 61.058(a) and (b), Education Code, are amended to read as follows:

(a) This section does not apply to [Except as provided by Subsection (b) of this section, the board shall approve or disapprove all new construction and repair and rehabilitation of all buildings and facilities at institutions of higher education financed from any source provided that:

[(A) the board's consideration and determination shall be limited to the purpose for which the new or remodeled buildings are to be used to assure conformity with approved space utilization standards and the institution's approved programs and role and mission if the cost of the project is not more than $4,000,000, but the board may consider cost factors and the financial implications of the project to the state if the total cost is in excess of $4,000,000;

[(B) the requirement of approval for new construction applies only to projects the total cost of which is in excess of $4,000,000;

[(C) the requirement of approval for major repair and rehabilitation of buildings and facilities applies only to a project the total cost of which is more than $4,000,000;

[(D) the requirement of approval or disapproval by the board does not apply to any new construction or major repair and rehabilitation project that is specifically approved by the legislature;

[(E) the requirement of approval by the board does not apply to a junior college's construction, repair, or rehabilitation financed entirely with funds from a source other than the state, including funds from ad valorem tax receipts of the college, gifts, grants, and donations to the college, and student fees; and

[(F) the requirement of approval by the board does not apply to construction, repair, or rehabilitation of privately owned buildings and facilities located on land leased from an institution of higher education if the construction, repair, or rehabilitation is financed entirely from funds not under the control of the institution, and provided further that:

[(i) the] buildings and facilities that are to be used exclusively for auxiliary enterprises[;] and

[(ii) the buildings and facilities] will not require appropriations from the legislature for operation, maintenance, or repair [unless approval by the board has been obtained].

(b) The [This section does not apply to construction, repair, or rehabilitation financed by bonds issued under Section 55.17(e)(3) or (4), 55.1713-55.1718, 55.1721-55.1728, 55.174, 55.1742, 55.1743, 55.1744, 55.1751-55.17592, 55.1768, 55.1771, or 55.17721, except that the] board may [shall] review all construction, repair, or rehabilitation of buildings and facilities at institutions of higher education [to be financed by bonds issued under those sections] to determine whether the construction, rehabilitation, or repair meets the standards adopted by board rule for cost, efficiency, and space use, but the construction, rehabilitation, or repair is not contingent on board approval. If the construction, rehabilitation, or repair does not meet those standards, the board shall notify the governor, the lieutenant governor, the speaker of the house of representatives, and the Legislative Budget Board.

SECTION 4.04. Section 2166.302(c), Government Code, is amended to read as follows:

(c) Subsection (a) does not apply to a project constructed by and for the Texas Department of Transportation or an institution of higher education or university system. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 4.05. Section 2166.403(c-1), Government Code, is amended to read as follows:

(c-1) For a project constructed by and for a state institution of higher education, the [governing body of the] institution shall, during the planning phase of the proposed construction for the project, verify [in an open meeting] the economic feasibility of incorporating into the building's design and proposed energy system alternative energy devices for space heating and cooling functions, water heating functions, electrical load functions, and interior lighting functions. The [governing body of the] institution shall determine the economic feasibility of each function listed in this subsection by comparing the estimated cost of providing energy for the function, based on the use of conventional design practices and energy systems, with the estimated cost of providing energy for the function, based on the use of alternative energy devices, during the economic life of the building.

SECTION 4.06. Section 2167.001(b), Government Code, is amended to read as follows:

(b) This chapter does not apply to:

(1) radio antenna space;

(2) residential space for a Texas Department of Mental Health and Mental Retardation program;

(3) residential space for a Texas Youth Commission program;

(4) space to be used for less than one month for meetings, conferences, conventions, seminars, displays, examinations, auctions, or similar purposes;

(5) district office space for members of the legislature;

(6) space used by the Texas Workforce Commission;

(7) residential property acquired by the Texas Department of Housing and Community Affairs or the Texas State Affordable Housing Corporation that is offered for sale or rental to individuals and families of low or very low income or families of moderate income;

(8) except as provided by Section 2167.007, [classroom and instructional] space for a university system or [an] institution of higher education; or

(9) space leased by the Texas Veterans Commission to administer the veterans employment services program.

SECTION 4.07. Section 33.06, Tax Code, is amended by adding Subsection (g) to read as follows:

(g) If the ownership interest of an individual entitled to defer collection of a tax under this section is a life estate, the individual must submit with the affidavit required by Subsection (b) the written consent to the deferral of any university system or institution of higher education that is an owner of a remainder interest in the property on which taxes are to be deferred. In the absence of that consent, a lien for taxes attaches only to the life estate of the life tenant. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code. This subsection does not apply to a deferral for which the individual entitled to the deferral filed the affidavit required by Subsection (b) before September 1, 2011.

ARTICLE 5. BOARD APPOINTMENTS

SECTION 5.01. Section 552.123, Government Code, is amended to read as follows:

Sec. 552.123. EXCEPTION: NAME OF APPLICANT FOR CHIEF EXECUTIVE OFFICER OF INSTITUTION OF HIGHER EDUCATION. The name of an applicant for the position of chief executive officer of an institution of higher education, and other information that would tend to identify the applicant, is excepted from the requirements of Section 552.021, except that the governing body of the institution must give public notice of the name or names of the finalists being considered for the position at least 21 days before the date of the meeting at which final action or vote is to be taken on the employment of the person.

SECTION 5.02. Section 95.006(b), Health and Safety Code, is amended to read as follows:

(b) The advisory committee is composed of:

(1) the following representatives appointed by the executive director of the office:

(A) one representative of the office;

(B) one representative of the Texas Education Agency;

(C) one representative of the Texas Pediatric Society;

(D) one representative of the American Diabetes Association;

(E) [one representative who is a member of the board of regents of The University of Texas--Pan American;

[(F)] one school nurse representative from an urban school located within the boundaries of a regional education service center;

(F) [(G)] one parent or guardian of a child who resides within the boundaries of a regional education service center; and

(G) [(H)] one person with knowledge and experience in health care in school settings; and

(2) the following representatives appointed by the chairman of the council:

(A) one representative of the council;

(B) one representative of the Texas Medical Association;

(C) one school district administrator representative from a school district located within the boundaries of a regional education service center;

(D) one school principal representative from a school district located within the boundaries of a regional education service center; and

(E) one school nurse representative from a rural school located within the boundaries of a regional education service center.

SECTION 5.03. Sections 2.03(a) and (c), Chapter 670, Acts of the 72nd Legislature, 1991 (Article 4477-7j, Vernon's Texas Civil Statutes), are amended to read as follows:

(a) On or after the effective date of this Act, the Commissioners Court of Gaines County shall appoint three persons, the governing body of the city of Seminole shall appoint two persons, and the governing body of the city of Seagraves shall appoint two persons to serve as initial directors of the district. The four persons appointed by the governing bodies of the cities of Seminole and Seagraves shall represent the municipalities within the county, and the three persons appointed by the Commissioners Court of Gaines County shall represent the unincorporated areas of the county. [In addition, the board of regents of The University of Texas System shall appoint one person to serve as an ex-officio, nonvoting director of the district.]

(c) The Commissioners Court of Gaines County and the governing bodies of the cities of Seminole and Seagraves shall each appoint one initial director to serve a term expiring on May 1 of the first year after the year in which the original appointment is made. In addition, the Commissioners Court of Gaines County shall appoint two initial directors and the governing bodies of the cities of Seminole and Seagraves shall each appoint one initial director to serve terms expiring on May 1 of the second year after the year in which the original appointment is made. [The initial ex-officio member serves a term expiring on May 1 of the second year after the year in which the original appointment is made.] Successor directors serve two-year terms.

SECTION 5.04. Section 3.01(a), Chapter 670, Acts of the 72nd Legislature, 1991 (Article 4477-7j, Vernon's Texas Civil Statutes), is amended to read as follows:

(a) The district is governed by a board of directors composed of seven voting members [and one ex-officio nonvoting member] who are appointed as provided by this Act. However, the district shall change to a system of electing the voting directors if:

(1) the Commissioners Court of Gaines County and the governing bodies of the cities of Seminole and Seagraves each pass a resolution calling for the election of the directors; or

(2) the board receives a petition signed by at least 150 registered voters of Gaines County calling for the election of the directors.

ARTICLE 6. REPORTS; RECORDS; AUDITS; NOTICES

SECTION 6.01. Section 51.403(d), Education Code, is amended to read as follows:

(d) For purposes of this subsection, "small classes" [Each institution shall file with its governing board and the coordinating board a small class report, excluding individual instruction courses, indicating department, course number, title of course, and the name of the instructor. "Small classes," for the purpose of this report,] are undergraduate-level courses with less than 10 registrations, and graduate-level courses with less than 5 registrations. No small classes shall be offered in any institution except as authorized by the appropriate governing board, within the guidelines established by the Coordinating Board.

SECTION 6.02. Subchapter H, Chapter 51, Education Code, is amended by adding Section 51.406 to read as follows:

Sec. 51.406. EXPIRATION OF CERTAIN REPORTING REQUIREMENTS APPLICABLE TO INSTITUTIONS OF HIGHER EDUCATION AND UNIVERSITY SYSTEMS. (a) In this section, "university system" has the meaning assigned by Section 61.003.

(b) To the extent that any of the following laws require reporting by a university system or an institution of higher education, a university system or institution of higher education is not required to make the report on or after September 1, 2013, unless legislation enacted by the 83rd Legislature that becomes law expressly requires the institution or system to make the report:

(1) Section 7.109;

(2) Section 33.083;

(3) Sections 51.005(a), (b), and (c);

(4) Section 51.0051;

(5) Section 51.4032;

(6) Section 56.039;

(7) Section 59.07;

(8) Section 61.051(j);

(9) Section 130.086;

(10) Section 325.007, Government Code;

(11) Section 669.003, Government Code;

(12) Section 2005.007, Government Code;

(13) Section 2052.103, Government Code;

(14) Section 2054.097, Government Code;

(15) Section 2101.011, Government Code;

(16) Section 2102.009, Government Code;

(17) Chapter 2114, Government Code;

(18) Section 2161.123, Government Code;

(19) Section 2205.041, Government Code;

(20) Section 21.454, Labor Code; and

(21) Section 21.504, Labor Code.

(c) A rule or policy of a state agency, including the Texas Higher Education Coordinating Board, in effect on June 1, 2011, that requires reporting by a university system or an institution of higher education has no effect on or after September 1, 2013, unless the rule or policy is affirmatively and formally readopted before that date by formal administrative rule published in the Texas Register and adopted in compliance with Chapter 2001, Government Code. This subsection does not apply to:

(1) a rule or policy for which the authorizing statute is listed in Subsection (b);

(2) a rule or policy for which the authorizing statute is repealed on or before September 1, 2013, by legislation enacted by the legislature that becomes law; or

(3) a report required under any of the following laws:

(A) Section 51.3062;

(B) Section 51.402;

(C) Section 51.403;

(D) Section 61.051(k); or

(E) Section 61.059.

SECTION 6.03. Section 61.051(h), Education Code, is amended to read as follows:

(h) The board shall make continuing studies of the needs of the state for research and designate the institutions of higher education to perform research as needed. The board shall also maintain an inventory of all institutional and programmatic research activities being conducted by the various institutions, whether state-financed or not. Once a year, on dates prescribed by the board, each institution of higher education shall report to the board all research conducted at that institution during the last preceding year. The submission by an institution of the institution's response to the National Science Foundation's annual Higher Education Research and Development Survey satisfies the requirements of this section. All reports required by this subsection shall be made subject to the limitations imposed by security regulations governing defense contracts for research.

SECTION 6.04. Section 61.0582, Education Code, is amended by adding Subsection (f) to read as follows:

(f) This section does not apply to a university system that maintains an ongoing system-wide capital improvement program approved by the system's board of regents.

SECTION 6.05. Section 401.042, Government Code, is amended by adding Subsection (c) to read as follows:

(c) In consultation with public institutions of higher education, the offices of the governor and the Legislative Budget Board shall review the forms for higher education legislative appropriations requests to identify opportunities to improve efficiency, provide better transparency of funding sources, eliminate unnecessary or duplicative requirements, and otherwise reduce the cost or difficulty of providing information related to appropriations requests.

SECTION 6.06. Subchapter L, Chapter 403, Government Code, is amended by adding Section 403.2715 to read as follows:

Sec. 403.2715. UNIVERSITY SYSTEMS AND INSTITUTIONS OF HIGHER EDUCATION. (a) In this section, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

(b) Except as provided by this section, this subchapter does not apply to a university system or institution of higher education.

(c) A university system or institution of higher education shall account for all personal property as defined by the comptroller under Section 403.272. At all times, the property records of a university system or institution of higher education must accurately reflect the personal property possessed by the system or institution.

(d) The chief executive officer of each university system or institution of higher education shall designate one or more property managers. The property manager shall maintain the records required and be the custodian of all personal property possessed by the system or institution.

(e) Sections 402.273(h), 403.275, and 403.278 apply to a university system or institution of higher education.

SECTION 6.07. Section 2054.1125, Government Code, is amended by adding Subsection (c) to read as follows:

(c) This section does not apply to a university system or institution of higher education that adopts procedures for notifying affected individuals of a breach of information system security. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 6.08. Section 2101.0115(d), Government Code, is amended by adding Subdivision (4) to read as follows:

(4) "Institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 6.09. Section 2101.0115, Government Code, is amended by adding Subsection (e) to read as follows:

(e) This section does not apply to an institution of higher education or university system.

SECTION 6.10. Section 2254.028(c), Government Code, is amended to read as follows:

(c) Subsection (a) [(a)(3)] does not apply to a major consulting services contract to be entered into by an institution of higher education other than a public junior college if the institution includes in the invitation published under Section 2254.029 a finding by the chief executive officer of the institution that the consulting services are necessary and an explanation of that finding.

SECTION 6.11. Section 2254.0301, Government Code, is amended to read as follows:

Sec. 2254.0301. CONTRACT NOTIFICATION. (a) A state agency shall provide written notice to the Legislative Budget Board of a contract for consulting services if the amount of the contract, including an amendment, modification, renewal, or extension of the contract, exceeds $14,000. The notice must be on a form prescribed by the Legislative Budget Board and filed not later than the 10th day after the date the entity enters into the contract.

(b) This section does not apply to a university system or institution of higher education. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 6.12. Section 388.005(f), Health and Safety Code, is amended to read as follows:

(f) This section does not apply to a state agency or an institution of higher education that the State Energy Conservation Office determines [that], before September 1, 2007, adopted a plan for conserving energy under which the agency or institution established a percentage goal for reducing the consumption of electricity. The exemption provided by this section applies only while the agency or institution has an energy conservation plan in effect and only if the agency or institution submits reports on the conservation plan each year [calendar quarter] to the governor, the Legislative Budget Board, and the State Energy Conservation Office.

SECTION 6.13. Section 21.552, Labor Code, is amended by adding Subsection (c) to read as follows:

(c) This section does not apply to a university system or institution of higher education, except to the extent required by federal law. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 6.14. Section 412.053, Labor Code, is amended by adding Subsection (c) to read as follows:

(c) This section does not apply to an institution of higher education or university system. In this subsection, "institution of higher education" and "university system" have the meanings assigned by Section 61.003, Education Code.

SECTION 6.15. Section 31.153(d), Natural Resources Code, is amended to read as follows:

(d) Each state agency, other than an institution of higher education, annually at the time set by the division, shall furnish the Texas Historical Commission with a photograph and information that specifies and identifies the age of each building:

(1) that was acquired by the agency after the date of the preceding annual submission and that is at least 45 years old on the date of the current submission; or

(2) that is possessed by the agency and has become 45 years old since the date the information was previously submitted.

ARTICLE 7. REPEALER

SECTION 7.01. (a) The following laws are repealed effective September 1, 2011:

(1) Section 51.4033, Education Code;

(2) Section 55.03(b), Education Code;

(3) Section 61.058(c), Education Code;

(4) Section 61.0815, Education Code;

(5) Section 61.086, Education Code;

(6) Section 62.098, Education Code;

(7) Section 74.008(f), Education Code;

(8) Section 830.006, Government Code;

(9) Section 1434.054, Government Code;

(10) Section 2107.005, Government Code;

(11) Section 412.042(c), Labor Code; and

(12) Section 3.01(c), Chapter 670, Acts of the 72nd Legislature, 1991 (Article 4477-7j, Vernon's Texas Civil Statutes).

(b) The following laws are repealed effective September 1, 2013:

(1) Section 51.859, Education Code;

(2) Section 51.917(e), Education Code;

(3) Section 51.968(d), Education Code;

(4) Section 54.203(h), Education Code;

(5) Section 56.034(c), Education Code;

(6) Section 56.079(j), Education Code;

(7) Section 61.066(c), Education Code;

(8) Section 61.806(f), Education Code;

(9) Section 61.857, Education Code;

(10) Section 61.9626, Education Code;

(11) Section 61.9627(b), Education Code;

(12) Section 63.003(d), Education Code;

(13) Section 63.004, Education Code;

(14) Section 63.103, Education Code;

(15) Section 86.52(m), Education Code;

(16) Section 88.210, Education Code;

(17) Section 106.54, Education Code;

(18) Section 142.005, Education Code;

(19) Section 143.006, Education Code;

(20) Section 147.005, Education Code;

(21) Section 148.005, Education Code; and

(22) Section 153.008, Education Code.

ARTICLE 8. EFFECTIVE DATE

SECTION 8.01. 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, this Act takes effect September 1, 2011.