89R477 RDS-D

By: Tepper H.B. No. 167

A BILL TO BE ENTITLED

AN ACT

relating to the implementation of diversity, equity, and inclusion initiatives and certain prohibited considerations in contracting by governmental entities.

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

ARTICLE 1. TITLE

SECTION 1.01. This Act may be cited as the Ending Institutional Racism Act.

ARTICLE 2. PROHIBITED DIVERSITY, EQUITY, AND INCLUSION INITIATIVES

BY GOVERNMENTAL ENTITIES

SECTION 2.01. Subtitle A, Title 6, Government Code, is amended by adding Chapter 621 to read as follows:

CHAPTER 621. PROHIBITION ON CERTAIN DIVERSITY, EQUITY, AND

INCLUSION INITIATIVES

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 621.001. DEFINITIONS. In this chapter:

(1) "Diversity, equity, and inclusion office" means an office, division, or other unit of a governmental entity established for the purpose of:

(A) influencing hiring or employment practices at the entity with respect to race, sex, color, or ethnicity, other than through the use of color-blind and sex-neutral hiring processes in accordance with any applicable state and federal antidiscrimination laws;

(B) promoting differential treatment or providing special benefits to individuals on the basis of race, sex, color, or ethnicity;

(C) promoting policies or procedures designed or implemented in reference to race, color, or ethnicity, other than policies or procedures implemented for the purpose of ensuring compliance with any applicable federal law; or

(D) conducting trainings, programs, or activities designed or implemented in reference to race, color, ethnicity, gender identity, or sexual orientation, other than trainings, programs, or activities conducted for the purpose of ensuring compliance with any applicable court order or state or federal law.

(2) "Governmental entity" means:

(A) a department, commission, board, office, or other agency that is in the executive branch of state government and that was created by the constitution or a statute, other than an institution of higher education as defined by Section 61.003, Education Code;

(B) the legislature or a legislative state agency;

(C) the supreme court, the court of criminal appeals, a court of appeals, a district court, or the Texas Judicial Council or another agency in the judicial branch of state government;

(D) a county, municipality, special purpose district, including a school district, or any other political subdivision of this state; or

(E) an open-enrollment charter school established under Subchapter D, Chapter 12, Education Code.

SUBCHAPTER B. DIVERSITY, EQUITY, AND INCLUSION INITIATIVES

Sec. 621.051. RESPONSIBILITY OF GOVERNMENTAL ENTITY REGARDING DIVERSITY, EQUITY, AND INCLUSION INITIATIVES. (a) A governmental entity shall ensure that each unit of the entity:

(1) does not, except as required by federal law:

(A) establish or maintain a diversity, equity, and inclusion office;

(B) hire or assign an employee of the entity or contract with a third party to perform the duties of a diversity, equity, and inclusion office;

(C) compel, require, induce, or solicit any person to provide a diversity, equity, and inclusion statement or give preferential consideration to any person based on the provision of a diversity, equity, and inclusion statement;

(D) give preference on the basis of race, sex, color, ethnicity, or national origin to an applicant for employment, an employee, or a participant in any function of the entity; or

(E) require as a condition of employment any person to participate in diversity, equity, and inclusion training, which:

(i) includes a training, program, or activity designed or implemented in reference to race, color, ethnicity, gender identity, or sexual orientation; and

(ii) does not include a training, program, or activity developed for the purpose of ensuring compliance with any applicable federal law; and

(2) adopts policies and procedures for appropriately disciplining, including by termination, an employee or contractor of the entity who engages in conduct in violation of Subdivision (1).

(b) Subsection (a)(1) may not be construed to apply to:

(1) academic course instruction;

(2) scholarly research or a creative work by a school district's or open-enrollment charter school's students or faculty;

(3) an activity of a student organization registered with or recognized by a school district or open-enrollment charter school;

(4) guest speakers or performers on short-term engagements;

(5) a program or activity to enhance student academic achievement or postgraduate outcomes that allows participation without regard to race, sex, color, or ethnicity; or

(6) data collection.

SUBCHAPTER C. LIABILITY FOR CERTAIN DIVERSITY, EQUITY, AND

INCLUSION INITIATIVES

Sec. 621.101. LIABILITY FOR CERTAIN INITIATIVES. The following individuals may bring an action against a governmental entity that violates Section 621.051:

(1) an employee of the governmental entity; or

(2) an individual who resides in an area served by the governmental entity.

Sec. 621.102. REMEDIES. (a) A claimant is entitled to recover in an action brought under this chapter:

(1) declaratory and injunctive relief; and

(2) costs and reasonable attorney's fees.

(b) If the court finds an action brought under this chapter to be frivolous, a governmental entity is entitled to recover costs and reasonable attorney's fees.

Sec. 621.103. IMMUNITY WAIVER. The sovereign immunity of this state and governmental immunity of a political subdivision to suit and from liability is waived to the extent of the liability created by this chapter.

Sec. 621.104. NOTICE. A governmental entity is entitled to receive notice of a claim against it under this chapter not later than 90 days before the date a claimant files an action under this chapter. The notice must reasonably describe a specific action of the governmental entity that is the basis for the claim against it.

Sec. 621.105. VENUE. (a) Notwithstanding any other law, including Chapter 15, Civil Practice and Remedies Code, and except as provided by Subsection (b), a claimant may bring an action under this chapter in a county in which the governmental entity is located.

(b) A claimant must bring an action under this chapter in Travis County if the governmental entity is:

(1) an agency, board, commission, department, or office that is in the executive branch of state government;

(2) the legislature or a legislative state agency; or

(3) the supreme court, the court of criminal appeals, the Texas Judicial Council, or another agency in the judicial branch of state government.

(c) If the action is brought in a venue authorized by this section, the action may not be transferred to a different venue without the written consent of all parties.

ARTICLE 3. PROHIBITION ON CERTAIN CONSIDERATIONS IN CONTRACTING

SECTION 3.01. Subchapter Z, Chapter 2252, Government Code, is amended by adding Section 2252.911 to read as follows:

Sec. 2252.911. PROHIBITED CONSIDERATIONS IN CONTRACTING. (a) In this section, "governmental entity" has the meaning assigned by Section 2252.001, except that the term does not include an institution of higher education as defined by Section 61.003, Education Code.

(b) Notwithstanding any other law, a governmental entity may not award a contract or provide preferential treatment to a person submitting a bid for a contract on the basis of race, color, ethnicity, sex, gender identity, or sexual orientation.

SECTION 3.02. Section 106.001(c), Civil Practice and Remedies Code, is amended to read as follows:

(c) This section does not prohibit the adoption of a program designed to increase the participation of businesses owned and controlled by [women, minorities, or] disadvantaged persons in public contract awards.

SECTION 3.03. Section 2161.001(3), Government Code, is amended to read as follows:

(3) "Economically disadvantaged person" means a person who:

(A) is economically disadvantaged because of the person's status [identification] as a veteran [member of a certain group, including:

[(i) Black Americans;

[(ii) Hispanic Americans;

[(iii) women;

[(iv) Asian Pacific Americans;

[(v) Native Americans; and

[(vi) veterans] as defined by 38 U.S.C. Section 101(2) who has [have] suffered at least a 20 percent service-connected disability as defined by 38 U.S.C. Section 101(16); and

(B) has suffered the effects of discriminatory practices or other similar insidious circumstances over which the person has no control.

SECTION 3.04. Sections 2161.061(b), (d), and (e), Government Code, are amended to read as follows:

(b) As one of its certification procedures, the comptroller may:

(1) approve the certification program of one or more local governments or nonprofit organizations in this state that certify historically underutilized businesses [, minority business enterprises, women's business enterprises,] or disadvantaged business enterprises under substantially the same definition, to the extent applicable, used by Section 2161.001, if the local government or nonprofit organization meets or exceeds the standards established by the comptroller; and

(2) certify a business that is certified by a local government or by a nonprofit organization as a historically underutilized business under this chapter.

(d) A local government or a nonprofit organization that certifies historically underutilized businesses [, minority business enterprises, women's business enterprises,] or disadvantaged business enterprises as described in Subsections (b) and (c) shall complete the certification of an applicant or provide an applicant with written justification of its certification denial within the period established by the comptroller in its rules for certification activities.

(e) A local government or a nonprofit organization that certifies historically underutilized businesses under Subsection (c) or that conducts a certification program described by and approved under Subsection (b) shall make available to the public an online searchable database containing information about historically underutilized businesses [, minority business enterprises, women's business enterprises,] and disadvantaged business enterprises certified by the local government or nonprofit organization, including:

(1) the name of the business;

(2) the contact person or owner of the business;

(3) the address and telephone number of the business;

(4) the type or category of business, including relevant capabilities of the business and the North American Industry Classification System codes for the business; and

(5) the expiration date of the business's certification.

SECTION 3.05. Section 2269.055(b), Government Code, is amended to read as follows:

(b) In determining the award of a contract under this chapter, the governmental entity shall:

(1) consider and apply any existing laws, including any criteria, related to historically underutilized businesses; and

(2) consider and apply any existing laws, rules, or applicable municipal charters, including laws applicable to local governments, related to the use of [women, minority,] small [,] or disadvantaged businesses.

SECTION 3.06. Section 2303.405(e), Government Code, is amended to read as follows:

(e) Factors to be considered in evaluating the local effort of a private entity include:

(1) the willingness to negotiate or cooperate in the achievement of the purposes of this chapter;

(2) commitments to hire underskilled, inexperienced, disadvantaged, or displaced workers who reside in the enterprise zone;

(3) [commitments to hire minority workers and to contract with minority-owned businesses;

[(4)] provision of technical and vocational job training for enterprise zone residents or economically disadvantaged employees;

(4) [(5)] provision of child care for employees;

(5) [(6)] commitments to implement and contribute to a tutoring or mentoring program for area students;

(6) [(7)] prevention or reduction of juvenile crime activity; and

(7) [(8)] the willingness to make contributions to the well-being of the community, such as job training, or the donation of land for parks or other public purposes.

SECTION 3.07. Section 2310.305(e), Government Code, is amended to read as follows:

(e) Factors to be considered in evaluating the local effort of a private entity include:

(1) the willingness to negotiate or cooperate in the redevelopment of vacated defense facilities and the creation of high-skilled, high wage jobs;

(2) commitments to hire dislocated defense workers and economically disadvantaged workers;

(3) [commitments to hire minority workers and to contract with minority-owned businesses;

[(4)] provision of technical and vocational job training for residents of the nominating body's jurisdiction or economically disadvantaged employees;

(4) [(5)] provision of child care for employees;

(5) [(6)] commitments to implement and contribute to a tutoring or mentoring program for area students;

(6) [(7)] prevention or reduction of juvenile crime; and

(7) [(8)] the willingness to make contributions to the well-being of the community, such as job training, or the donation of land for parks or other public purposes.

SECTION 3.08. Section 281.051(c), Health and Safety Code, is amended to read as follows:

(c) The board shall encourage and promote participation by all sectors of the business community, including small businesses [and businesses owned by members of a minority group or by women], in the process by which the district enters into contracts. The board shall develop a plan for the district to identify and remove barriers that do not have a definite or objective relationship to quality or competence and that unfairly discriminate against small businesses [and businesses owned by members of a minority or by women]. These barriers may include contracting procedures and contract specifications or conditions.

SECTION 3.09. Section 91.005, Labor Code, is amended to read as follows:

Sec. 91.005. APPLICATION OF CERTAIN PROCUREMENT LAWS. With respect to a bid, contract, purchase order, or agreement entered into with the state or a political subdivision of the state, a client's status or certification as a small or [, minority-owned,] disadvantaged [, or woman-owned] business enterprise or as a historically underutilized business is not affected because the client has entered into a professional employer services agreement with a license holder or uses the services of a license holder.

SECTION 3.10. Sections 381.004(a) and (b), Local Government Code, are amended to read as follows:

(a) In this section, "another [:

[(1) "Another] entity" includes the federal government, the State of Texas, a municipality, school or other special district, finance corporation, institution of higher education, charitable or nonprofit organization, foundation, board, council, commission, or any other person.

[(2) "Minority" includes blacks, Hispanics, Asian Americans, American Indians, and Alaska natives.

[(3) "Minority business" means a business concern, more than 50 percent of which is owned and controlled in management and daily operations by members of one or more minorities.

[(4) "Women-owned business" means a business concern, more than 50 percent of which is owned and controlled in management and daily operations by one or more women.]

(b) To stimulate business and commercial activity in a county, the commissioners court of the county may develop and administer a program:

(1) for state or local economic development;

(2) for small or disadvantaged business development;

(3) to stimulate, encourage, and develop business location and commercial activity in the county;

(4) to promote or advertise the county and its vicinity or conduct a solicitation program to attract conventions, visitors, and businesses;

(5) [to improve the extent to which women and minority businesses are awarded county contracts;

[(6)] to support comprehensive literacy programs for the benefit of county residents; or

(6) [(7)] for the encouragement, promotion, improvement, and application of the arts.

SECTION 3.11. Section 3871.103(d), Special District Local Laws Code, is amended to read as follows:

(d) The district must follow Resolution 08-2826, adopted by the city on October 22, 2008, for construction, procurement, and professional services contracts related to the use of historically underutilized businesses [and minority contracting] in the implementation of its district plan.

SECTION 3.12. Section 3884.103(d), Special District Local Laws Code, is amended to read as follows:

(d) The district must follow Resolution 08-2826, adopted by the city on October 22, 2008, for construction, procurement, and professional services contracts related to the use of historically underutilized businesses [and minority contracting] in the implementation of its district plan.

SECTION 3.13. The heading to Section 22.084, Transportation Code, is amended to read as follows:

Sec. 22.084. AIRPORT REVENUE AND REVENUE BOND PROCEEDS [; CONTRACTING OPPORTUNITIES FOR MINORITY- AND WOMEN-OWNED BUSINESSES].

SECTION 3.14. Section 22.084(a), Transportation Code, is amended to read as follows:

(a) If constituent agencies or a nonprofit corporation created under Section 22.152 issues revenue bonds to finance the construction or acquisition of a facility or other improvement at an airport, the proceeds of the bonds and any other airport income or revenue may be spent on projects for which the proceeds, income, or revenue may otherwise be spent. An agreement may be made to spend all or a portion of the proceeds, income, or revenue for the planning, construction, or acquisition of facilities authorized by Sections 22.011(a)-(c) and 22.012 without inviting, advertising for, or otherwise requiring competitive bids. [A contract wholly or partly funded with proceeds, income, or revenue under this subsection shall be let in accordance with the joint board's rules and policies relating to creation of contracting opportunities for minority- and women-owned businesses.]

SECTION 3.15. The heading to Section 451.252, Transportation Code, is amended to read as follows:

Sec. 451.252. [MINORITY AND] DISADVANTAGED INDIVIDUALS PROGRAM: CERTAIN AUTHORITIES.

SECTION 3.16. Section 451.252(a), Transportation Code, is amended to read as follows:

(a) The board of an authority confirmed before July 1, 1985, shall establish a program to encourage participation in contracts of the authority by businesses owned by [minorities or] disadvantaged individuals.

SECTION 3.17. Section 452.001(1), Transportation Code, is amended to read as follows:

(1) "Authority" means a regional transportation authority created under this chapter or Chapter 683, Acts of the 66th Legislature, Regular Session, 1979. The term includes:

(A) when used in Subchapters B, C, D, F, H, and I and Section [Sections 452.201 and] 452.451, a subregional authority created by a contiguous municipality; and

(B) as appropriate, an authority, other than an authority created by a contiguous municipality, consisting of one subregion.

SECTION 3.18. The following provisions are repealed:

(1) Section 12.029, Agriculture Code;

(2) Sections 466.107, 466.151(c), 1232.104(c), and 2306.6734, Government Code;

(3) Section 775.306, Health and Safety Code;

(4) Section 381.004(d), Local Government Code;

(5) Sections 161.131 and 161.132, Natural Resources Code;

(6) Section 2026.152(b), Occupations Code;

(7) Sections 451.253 and 452.201, Transportation Code; and

(8) Sections 311.0101(d) and 351.1065(c), Tax Code.

ARTICLE 4. TRANSITION; EFFECTIVE DATE

SECTION 4.01. The changes in law made by Article 3 of this Act apply only to a contract entered into on or after the effective date of this Act. A contract entered into before that date is governed by the law in effect on the date the contract was entered into, and the former law is continued in effect for that purpose.

SECTION 4.02. This Act takes effect September 1, 2025.