BILL ANALYSIS

S.B. 2138

By: Creighton

Higher Education

Committee Report (Unamended)

BACKGROUND AND PURPOSE

The bill sponsor has informed the committee that the 87th Texas Legislature passed legislation that prohibits certain state governmental entities from investing in financial companies that boycott certain energy companies. The bill sponsor has also informed the committee that the politically fueled practice of environmental, social, and governance (ESG) initiatives results in financially underperforming funds for investors. S.B. 2138 seeks to apply the existing prohibition on investment in financial companies that boycott certain energy companies to the permanent university fund, the Texas University Fund, and the governing body of a public institution of higher education.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

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. 2138 amends the Education Code to establish that the Government Code provisions regarding the prohibition on investment in financial companies that boycott certain energy companies apply to the following as if the entity or fund were a state governmental entity under those provisions:

· a governing board of a public institution of higher education;

· the Texas University Fund; and

· the permanent university fund.

EFFECTIVE DATE

September 1, 2025.