88R13798 MLH-D

By: Campbell S.B. No. 2367

A BILL TO BE ENTITLED

AN ACT

relating to the creation of programs and funding for investment in technology industries.

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

SECTION 1. Subtitle F, Title 4, Government Code, is amended by adding Chapter 490J to read as follows:

CHAPTER 490J. FUNDING FOR TECHNOLOGY INVESTMENT

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 490J.001. DEFINITIONS. In this chapter:

(1) "Committee" means the Texas Technology Investment Committee.

(2) "Fund" means the Texas technology investment fund.

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

Sec. 490J.002. PURPOSES. The fund is established under this chapter to develop and diversify the economy of this state by:

(1) investing in innovative technology and industries; and

(2) attracting, creating, or expanding private sector entities that will promote a substantial increase in high quality jobs.

Sec. 490J.003. ELIGIBLE TECHNOLOGY INDUSTRIES. A technology industry participant is eligible for funding under this chapter if the activity to be funded:

(1) will produce products that compete with Chinese companies that provide information and communications technology and services; and

(2) either:

(A) will result in the creation of high quality new jobs in this state, immediately or over a longer period; or

(B) has the potential to result in a medical or scientific breakthrough.

SUBCHAPTER B. TEXAS TECHNOLOGY INVESTMENT COMMITTEE

Sec. 490J.051. COMPOSITION OF COMMITTEE. The Texas Technology Investment Committee is composed of 17 members.

Sec. 490J.052. APPOINTMENT BY GOVERNOR; NOMINATIONS. (a) The governor shall appoint to the committee individuals nominated as provided by Subsection (b).

(b) The following persons may nominate one or more individuals who are industry leaders in this state or who are nationally recognized researchers from public or private institutions of higher education in this state for appointment to the committee:

(1) the Texas Higher Education Coordinating Board;

(2) a president of a public or private institution of higher education in this state;

(3) the members of the Texas Workforce Commission;

(4) a representative of the governor's office involved in economic development activities;

(5) a representative of the lieutenant governor's office involved in economic development activities;

(6) a representative of the office of the speaker of the house involved in economic development activities; and

(7) other persons considered appropriate by the governor.

(c) The governor may prescribe a date after which a nomination under Subsection (b) for appointment for the next term will not be considered.

(d) If an insufficient number of qualified individuals are nominated as provided by Subsection (b) before the date set by the governor under Subsection (c), the governor may appoint any qualified individual to the board for that term.

Sec. 490J.053. PRESIDING MEMBER. The governor shall appoint a presiding member of the committee.

Sec. 490J.054. TERMS. Members of the committee serve two-year terms, subject to the pleasure of the governor.

Sec. 490J.055. COMMITTEE STAFF AND FUNDING. Necessary staff and funding for the committee shall be provided by:

(1) the office of the governor;

(2) the Texas Higher Education Coordinating Board;

(3) the Texas Education Agency;

(4) the Texas Workforce Commission;

(5) another public entity represented by a committee member; and

(6) gifts, grants, and donations for overhead expenses to the entities listed in Subdivisions (1)-(5).

Sec. 490J.056. RECOMMENDATIONS FOR FUNDING. (a) The committee shall make recommendations, through peer review and evaluation processes established by the committee, to the governor, lieutenant governor, and speaker of the house of representatives for the award of money from the fund as provided by this chapter.

(b) The committee may establish advisory panels of knowledgeable individuals from industry, state government, or academic occupations to assist in peer review activities under this chapter.

Sec. 490J.057. CONFIDENTIALITY. Information collected by the governor's office, the committee, or the committee's advisory panels concerning the identity, background, finance, marketing plans, trade secrets, or other commercially or academically sensitive information of an individual or entity being considered for an award from the fund is confidential unless the individual or entity consents to disclosure of the information.

SUBCHAPTER C. TEXAS TECHNOLOGY INVESTMENT FUND

Sec. 490J.101. TEXAS TECHNOLOGY INVESTMENT FUND. (a) The Texas technology investment fund is a dedicated account in the general revenue fund.

(b) The following amounts shall be deposited in the fund:

(1) any amounts appropriated by the legislature for the fund;

(2) benefits realized from a project undertaken with money from the fund, as provided by a contract entered into under Section 490J.102;

(3) gifts, grants, and other donations received for the fund; and

(4) interest earned on the investment of money in the fund.

(c) The fund may be used only for the purposes described by Section 490J.002.

(d) The committee may solicit and accept gifts and grants for the fund from public and private entities.

(e) The fund may be temporarily used by the comptroller for cash management purposes.

(f) The administration of the fund is considered to be a trusteed program within the office of the governor. The governor may negotiate on behalf of the state regarding awarding, by grant, money appropriated from the fund. The governor may award money appropriated from the fund only with the express written prior approval of the lieutenant governor and speaker of the house of representatives.

(g) Before awarding a grant under this chapter, the governor shall enter into a written agreement with the entity to be awarded the grant money. An agreement may specify that:

(1) if all or any portion of the amount of the grant is used to build a capital improvement:

(A) the state retains a lien or other interest in the capital improvement in proportion to the percentage of the grant amount used to pay for the capital improvement; and

(B) the recipient of the grant shall, if the capital improvement is sold:

(i) repay to the state the grant money used to pay for the capital improvement, with interest at the rate and according to the other terms provided by the agreement; and

(ii) share with the state a proportionate amount of any profit realized from the sale; and

(2) if, as of a date certain provided in the agreement, the grant recipient has not used grant money awarded under this chapter for the purposes for which the grant was intended, the recipient shall repay that amount and any related interest applicable under the agreement to the state at the agreed rate and on the agreed terms.

Sec. 490J.102. ALLOCATION OF PROCEEDS. (a) The contract between the governor and a recipient awarded a grant under this chapter shall provide for the distribution of royalties, revenue, or other financial benefits realized from the commercialization of intellectual or real property developed from any grant awarded from the fund. To the extent authorized by law and not in conflict with another agreement, the contract shall appropriately allocate by assignment, licensing, or other means the royalties, revenue, or other financial benefits among identifiable collaborating parties and in a specified percentage to this state for deposit in the fund.

(b) The contract under Subsection (a) shall also specify other matters considered necessary by the governor, lieutenant governor, and speaker of the house of representatives.

SUBCHAPTER D. INVESTMENTS IN ELIGIBLE TECHNOLOGY

Sec. 490J.151. USE OF MONEY FOR INVESTMENT IN PROJECTS. (a) Amounts may be awarded from the fund as provided by this chapter for eligible technology projects with a demonstrable economic benefit to this state.

(b) The committee shall recommend proposals eligible for funding under this section to the governor, lieutenant governor, and speaker of the house of representatives.

Sec. 490J.152. PRIORITY FOR FUNDING. In awarding money from the fund under this chapter, priority shall be given to proposals that:

(1) involve technology fields that have a reasonable probability of enhancing this state's national and global economic competitiveness; or

(2) have a demonstrable economic development benefit to this state by attracting technology industries to relocate to this state.

Sec. 490J.153. GUARANTEE OF ACTION BY PARTICIPATING ENTITY. (a) An entity that receives funding under this chapter shall guarantee by contract with the governor's office that the entity will perform specific actions expected to provide benefits to this state.

(b) If an entity fails to perform an action guaranteed by contract under Subsection (a) before a time specified by the contract, the entity shall return to the fund the money received by the entity under this chapter.

Sec. 490J.154. AUTHORIZED EXPENSES. (a) A person awarded money from the fund under this chapter may use the money to expedite commercialization that will lead to an increase in high quality jobs in this state and shall use the money in accordance with a contract between the person and the committee.

(b) Authorized expenses under this section include salaries and benefits, travel, consumable supplies, other operating expenses, contracted research and development, capital equipment, construction or renovation of state or private facilities, and workforce training.

SECTION 2. (a) As soon as practicable after the effective date of this Act, a person seeking to nominate an individual for appointment to the Texas Technology Investment Committee under Section 490J.052, Government Code, as added by this Act, shall make any nominations.

(b) The governor shall appoint the Texas Technology Investment Committee as required by Section 490J.052, Government Code, as added by this Act, on or before September 1, 2023, or as soon as practicable after giving persons nominating individuals for appointment to the committee a reasonable time to make any nominations.

SECTION 3. 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, 2023.