83R7788 EES-F

By: Howard H.B. No. 1074

A BILL TO BE ENTITLED

AN ACT

relating to the contents of and public access to personal financial statements and the creation of a select interim committee to undertake a comprehensive review of personal financial disclosures made to the Texas Ethics Commission and certain other authorities.

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

SECTION 1. Sections 572.023(a) and (b), Government Code, are amended to read as follows:

(a) A financial statement must include an account of the financial activity of the individual required by this subchapter to file a financial statement and an account of the financial activity of the individual's spouse and dependent children [if the individual had actual control over that activity] for the preceding calendar year.

(b) The account of financial activity consists of:

(1) a list of all sources of occupational income, identified by employer, or if self-employed, by the nature of the occupation, including identification of a person or other organization from which the individual or a business in which the individual has a substantial interest received a fee as a retainer for a claim on future services in case of need, as distinguished from a fee for services on a matter specified at the time of contracting for or receiving the fee, if professional or occupational services are not actually performed during the reporting period equal to or in excess of the amount of the retainer, and the category of the amount of the fee;

(2) identification by name and the category of the number of shares of stock of any business entity held or acquired, and if sold, the category of the amount of net gain or loss realized from the sale;

(3) a list of all bonds, notes, and other commercial paper held or acquired, and if sold, the category of the amount of net gain or loss realized from the sale;

(4) identification of each source and the category of the amount of income in excess of $500 derived from each source from interest, dividends, royalties, and rents;

(5) identification of each guarantor of a loan and identification of each person or financial institution to whom a personal note or notes or lease agreement for a total financial liability in excess of $1,000 existed at any time during the year and the category of the amount of the liability;

(6) identification by description of all beneficial interests in real property and business entities held or acquired, and if sold, the category of the amount of the net gain or loss realized from the sale;

(7) identification of a person or other organization from which the individual or the individual's spouse or dependent children received a gift of anything of value in excess of $250 and a description of each gift, except:

(A) a gift received from an individual related to the individual at any time within the second degree by consanguinity or affinity, as determined under Subchapter B, Chapter 573;

(B) a political contribution that was reported as required by Chapter 254, Election Code; and

(C) an expenditure required to be reported by a person required to be registered under Chapter 305;

(8) identification of the source and the category of the amount of all income received as beneficiary of a trust, other than a blind trust that complies with Subsection (c), and identification of each trust asset, if known to the beneficiary, from which income was received by the beneficiary in excess of $500;

(9) identification by description and the category of the amount of all assets and liabilities of a corporation, firm, partnership, limited partnership, limited liability partnership, professional corporation, professional association, joint venture, or other business association in which 50 percent or more of the outstanding ownership was held, acquired, or sold;

(10) a list of all boards of directors of which the individual is a member and executive positions that the individual holds in corporations, firms, partnerships, limited partnerships, limited liability partnerships, professional corporations, professional associations, joint ventures, or other business associations or proprietorships, stating the name of each corporation, firm, partnership, limited partnership, limited liability partnership, professional corporation, professional association, joint venture, or other business association or proprietorship and the position held;

(11) identification of any person providing transportation, meals, or lodging expenses permitted under Section 36.07(b), Penal Code, and the amount of those expenses, other than expenditures required to be reported under Chapter 305;

(12) any corporation, firm, partnership, limited partnership, limited liability partnership, professional corporation, professional association, joint venture, or other business association, excluding a publicly held corporation, in which both the individual and a person registered under Chapter 305 have an interest;

(13) identification by name and the category of the number of shares of any mutual fund held or acquired, and if sold, the category of the amount of net gain or loss realized from the sale; [and]

(14) identification of each blind trust that complies with Subsection (c), including:

(A) the category of the fair market value of the trust;

(B) the date the trust was created;

(C) the name and address of the trustee; and

(D) a statement signed by the trustee, under penalty of perjury, stating that:

(i) the trustee has not revealed any information to the individual, except information that may be disclosed under Subdivision (8); and

(ii) to the best of the trustee's knowledge, the trust complies with this section; and

(15) identification of any other source of earned or unearned income, including a pension, individual retirement account, or other retirement plan, and the category of the amount of income derived from each source.

SECTION 2. Section 572.032(a), Government Code, is amended to read as follows:

(a) Financial statements filed under this subchapter are public records. The commission shall maintain the statements in separate alphabetical files and in a manner that is accessible to the public during regular office hours and make the statements available to the public on the commission's website.

SECTION 3. Sections 572.032(b) and (c), Government Code, are repealed.

SECTION 4. (a) A select interim committee is created to study and review the procedures and effects of the filing of personal financial statements with the Texas Ethics Commission or other authorities under Chapter 572, Government Code, or other similar laws.

(b) The study must consider:

(1) the purposes of the current disclosure statutes and whether the statutes accomplish those purposes;

(2) the effectiveness of the current disclosure scheme; and

(3) what changes, if any, should be made to more effectively accomplish the purposes of personal financial disclosures.

(c) The committee is composed of:

(1) five members appointed by the lieutenant governor as follows:

(A) two senators;

(B) one representative of an open government advocacy organization;

(C) one representative of an organization representing professional media; and

(D) one member of the public;

(2) five members appointed by the speaker of the house of representatives as follows:

(A) two state representatives;

(B) one representative of an open government advocacy organization;

(C) one representative of an organization representing professional media; and

(D) one member of the public; and

(3) one member of the Texas Ethics Commission, appointed by the presiding officer of the Texas Ethics Commission, who shall serve as the presiding officer of the committee.

(d) The committee shall convene at the call of the presiding officer.

(e) The committee has all other powers and duties provided to a special or select committee by the rules of the senate and house of representatives, by Subchapter B, Chapter 301, Government Code, and by policies of the senate and house committees on administration.

(f) Not later than January 15, 2015, the committee shall report the committee's findings and recommendations to the lieutenant governor, the speaker of the house of representatives, and the governor. The committee shall include in its recommendations specific statutory and rule changes that appear necessary from the results of the committee's study under Subsection (a) of this section.

(g) Not later than the 60th day after the effective date of this Act, the lieutenant governor, the speaker of the house of representatives, and the presiding officer of the Texas Ethics Commission shall appoint the members of the committee created under this section.

(h) The Texas Legislative Council and the Texas Ethics Commission shall provide any necessary staff and resources to the committee created under this section.

(i) The committee created under this section is abolished and this section expires January 20, 2015.

SECTION 5. Section 572.023, Government Code, as amended by this Act, applies only to a financial statement filed under Subchapter B, Chapter 572, Government Code, on or after January 1, 2014. A financial statement filed before January 1, 2014, is governed by the law in effect on the date of filing, and the former law is continued in effect for that purpose.

SECTION 6. 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, 2013.