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A BILL TO BE ENTITLED
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AN ACT
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relating to restrictions on the use of state funds to benefit |
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private entities that outsource jobs to foreign countries. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subtitle F, Title 10, Government Code, is |
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amended by adding Chapter 2278 to read as follows: |
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CHAPTER 2278. RESTRICTING STATE INVESTMENT IN AND PROVISION OF TAX |
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BENEFITS TO ENTITIES THAT OUTSOURCE JOBS TO FOREIGN COUNTRIES |
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SUBCHAPTER A. GENERAL PROVISIONS |
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Sec. 2278.001. DEFINITION. In this chapter, "domestic" |
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means created or organized in the United States or under the laws of |
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the United States or any state. |
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[Sections 2278.002-2278.050 reserved for expansion] |
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SUBCHAPTER B. RESTRICTIONS ON INVESTMENTS |
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Sec. 2278.051. APPLICABILITY OF SUBCHAPTER. (a) This |
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subchapter applies in connection with the management or investment |
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of state funds managed or invested: |
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(1) under the Texas Constitution or other law, |
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including Chapters 404 and 2256; and |
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(2) by or for: |
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(A) a public retirement system as defined by |
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Section 802.001 that provides service retirement, disability |
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retirement, or death benefits for officers or employees of the |
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state; |
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(B) an institution of higher education as defined |
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by Section 61.003, Education Code; or |
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(C) another entity that is part of state |
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government and that manages or invests state funds or for which |
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state funds are managed or invested. |
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(b) This subchapter applies in connection with the management or |
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investment of state funds without regard to whether the funds are |
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held in the state treasury. |
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(c) This subchapter does not apply to the extent that an |
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investment standard prescribed by the Texas Constitution prohibits |
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the legislature from restricting the investment discretion of an |
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entity responsible for the management or investment of a fund. |
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Sec. 2278.052. PROHIBITION ON CERTAIN INVESTMENTS. A state |
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governmental entity may not invest state funds in or purchase |
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obligations of a domestic private entity that, at any time during |
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the previous two years, created employment suitable for performance |
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in the United States in a country other than the United States and, |
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as a result, eliminated or failed to create similar employment in |
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the United States. |
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[Sections 2264.053-2264.100 reserved for expansion] |
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SUBCHAPTER C. RESTRICTIONS ON ELIGIBILITY FOR TAX AND FEE BENEFITS |
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Sec. 2278.101. DEFINITION. In this subchapter, "state |
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agency" means a department, board, commission, or other agency in |
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the executive branch of state government. The term does not include |
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an institution of higher education as defined by Section 61.003, |
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Education Code. |
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Sec. 2278.102. APPLICABILITY OF SUBCHAPTER. This |
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subchapter does not apply to a credit, exemption, or discount for |
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which the Texas Constitution specifically prescribes the |
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eligibility requirements. |
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Sec. 2278.103. INELIGIBILITY OF CERTAIN ENTITIES FOR TAX |
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AND FEE BENEFITS. Notwithstanding other law, a domestic private |
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entity is not eligible for a credit, exemption, or discount in |
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relation to a tax or fee imposed by the state if the entity, at any |
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time during the previous two years, created employment suitable for |
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performance in the United States in a country other than the United |
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States and, as a result, eliminated or failed to create similar |
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employment in the United States. |
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Sec. 2278.104. DENIAL OF BENEFITS. (a) A state agency |
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responsible for the issuance of a credit, exemption, or discount in |
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relation to a tax or fee imposed by the state shall adopt rules in |
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accordance with Subchapter B, Chapter 2001, relating to the manner |
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in which: |
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(1) the agency will determine whether to deny the |
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benefit under Section 2264.103; and |
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(2) a person may ask the agency to reconsider the |
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denial. |
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(b) The rules adopted by a state agency shall require that as soon |
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as practicable after making the decision to deny a credit, |
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exemption, or discount to a domestic private entity that is |
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ineligible for the benefit under Section 2264.103 but is otherwise |
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eligible for the benefit, the state agency shall provide the |
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domestic private entity with notice of and the factual basis for the |
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denial and a description of the procedures available to request a |
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reconsideration and to contest the factual or legal basis for the |
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denial. |
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SECTION 2. Chapter 2278, Government Code, as added by this |
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Act, applies only to: |
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(1) an investment made by a state governmental entity on or |
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after September 1, 2026; and |
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(2) a credit, exemption, or discount provided or denied on |
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or after September 1, 2026, in relation to a tax or fee imposed by |
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the state. |
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SECTION 3. This Act takes effect September 1, 2025. |