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A BILL TO BE ENTITLED
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AN ACT
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relating to the administration of "pay for success" contracts for |
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state agencies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter G, Chapter 403, Government Code, is |
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amended by adding Section 403.110 to read as follows: |
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Sec. 403.110. SUCCESS CONTRACT PAYMENTS TRUST FUND. (a) |
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The success contract payments trust fund is established as a trust |
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fund outside the state treasury with the comptroller as trustee. |
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(b) The trust fund is established to provide a fund from |
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which the comptroller as trustee may make success contract payments |
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due in accordance with the contract terms without the necessity of |
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an appropriation for the contract payment. |
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(c) The trust fund consists of money appropriated for |
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deposit to the credit of the trust fund and any interest or other |
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earnings attributable to the trust fund. The comptroller shall hold |
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money credited to the trust fund for use only for payments due in |
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accordance with success contract terms and expenses incurred in |
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administering the trust fund or in administering the success |
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contracts for which the trust fund is established. The balance of |
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the trust fund may not exceed $50 million at any time. The |
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comptroller may establish in the trust fund one or more accounts to |
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administer money for a particular success contract for which money |
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has been credited to the trust fund. |
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(d) Notwithstanding any other law, a state agency and the |
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comptroller jointly may enter into a success contract with any |
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person the terms of which must include: |
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(1) that a majority of the contract payment is |
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conditioned on the contractor meeting or exceeding certain |
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specified performance measures toward the outcome of the contract's |
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objectives; |
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(2) a defined objective procedure by which an |
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independent evaluator is to determine whether the specified |
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performance measures have been met or exceeded; and |
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(3) a schedule of the amounts and timing of payments to |
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be earned by the contractor during each year or other specified |
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period of the contract that indicates the payment amounts |
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conditioned on meeting or exceeding the specified performance |
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measures. |
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(e) The comptroller and a state agency may not finally |
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execute a proposed success contract under this section unless: |
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(1) the comptroller and the Legislative Budget Board |
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certify that the proposed contract is expected to result in |
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significant performance improvements and significant budgetary |
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savings for the state agency or agencies party to the contract if |
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the performance targets are achieved; and |
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(2) the legislature has appropriated for deposit to |
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the credit of the trust fund, contingent on the execution of the |
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contract, an amount of money necessary to administer the contract |
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and make all payments that may become due under the contract over |
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the effective period of the contract. |
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(f) The comptroller shall make the contract payments for the |
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success contracts only from the trust fund and only in accordance |
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with the terms of the success contracts. The comptroller shall |
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deposit to the credit of the trust fund any money the comptroller |
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recovers from a contractor for overpayment or for a penalty or other |
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amount recoverable under the terms of a success contract and shall |
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hold the money in the trust fund in the same manner as the money held |
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for payments for the success contract. To the extent that any money |
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credited to the trust fund for a particular success contract |
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remains unpaid at the time the particular contract expires or is |
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terminated, as soon after the contract expiration as is |
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practicable, the comptroller shall return the unpaid amount to the |
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state treasury fund or account from which the money was |
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appropriated. |
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(g) The comptroller shall provide to each legislature not |
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later than the first day of the regular legislative session a report |
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that: |
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(1) provides details about the success in achieving |
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the specified performance measures of each success contract entered |
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into under this section that has not expired or been terminated or |
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that expired or was terminated since the date of the preceding |
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report under this subsection; and |
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(2) provides details about proposed success contracts |
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that have not been executed at the time of the report. |
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(h) The comptroller may adopt rules as necessary to |
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administer this section or success contracts entered into under |
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this section, including joint rules adopted with other agencies |
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that may be party to success contracts under this section. |
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SECTION 2. This Act takes effect September 1, 2015. |