Texas 2015 - 84th Regular

Texas Senate Bill SB1124 Compare Versions

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1	1	84R8638 CLG-D
2	2	By: Eltife S.B. No. 1124
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to creation of the university research initiative fund,
8	8	the abolishment of the Texas emerging technology fund, and the
9	9	disposition of balances from the Texas emerging technology fund.
10	10	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
11	11	SECTION 1. Subtitle H, Title 3, Education Code, is amended
12	12	by adding Chapter 156 to read as follows:
13	13	CHAPTER 156. UNIVERSITY RESEARCH INITIATIVE FUND
14	14	SUBCHAPTER A. GENERAL PROVISIONS
15	15	Sec. 156.001. DEFINITIONS. In this chapter:
16	16	(1) "Coordinating board" means the Texas Higher
17	17	Education Coordinating Board.
18	18	(2) "Fund" means the university research initiative
19	19	fund established under Subchapter B.
20	20	(3) "Institution of higher education" has the meaning
21	21	assigned by Section 61.003.
22	22	SUBCHAPTER B. OPERATION OF FUND AND PROGRAM
23	23	Sec. 156.051. UNIVERSITY RESEARCH INITIATIVE FUND. (a)
24	24	The university research initiative fund is a dedicated account in
25	25	the general revenue fund.
26	26	(b) The fund consists of:
27	27	(1) amounts appropriated or otherwise allocated or
28	28	transferred by law to the fund;
29	29	(2) any financial benefits realized from
30	30	commercialization of intellectual or other property developed in
31	31	connection with a grant award as provided by an agreement entered
32	32	into under Section 156.053; and
33	33	(3) gifts, grants, and other donations received for
34	34	the fund.
35	35	(c) The fund may be used by the coordinating board only for:
36	36	(1) the purpose specified by Section 156.052; and
37	37	(2) necessary expenses incurred in the administration
38	38	of the fund and this chapter.
39	39	Sec. 156.052. RECRUITMENT OF NATIONALLY OR INTERNATIONALLY
40	40	RENOWNED RESEARCHERS; MATCHING GRANTS. (a) The coordinating board
41	41	shall provide grants from the fund to institutions of higher
42	42	education to match available funding from those institutions for
43	43	the recruitment and retention of:
44	44	(1) members of recognized national academies in the
45	45	fields of science, technology, engineering, or mathematics or other
46	46	nationally recognized researchers in those fields and any
47	47	associated assistants; or
48	48	(2) researchers who are Nobel laureates in the fields
49	49	of science or mathematics or other internationally recognized
50	50	researchers in the fields described by this subsection or the
51	51	fields of technology or engineering and any associated assistants.
52	52	(b) In awarding grants, the coordinating board shall give
53	53	priority to proposals that involve the recruiting of researchers in
54	54	fields that are reasonably likely to contribute substantially to
55	55	this state's national and global economic competitiveness.
56	56	(c) The coordinating board may appoint one or more advisory
57	57	committees to assist the board with the review and evaluation of
58	58	grant proposals under this section.
59	59	Sec. 156.053. MATCHING GRANT AGREEMENT. (a) Before
60	60	awarding a matching grant under this chapter, the coordinating
61	61	board shall enter into a written agreement with the institution of
62	62	higher education selected to receive the grant.
63	63	(b) The agreement between the coordinating board and a grant
64	64	recipient under this chapter must provide for the distribution of
65	65	royalties, revenue, or other financial benefits realized from the
66	66	commercialization of intellectual or real property developed in
67	67	connection with receipt of a grant under this chapter. To the
68	68	extent authorized by law and not in conflict with another
69	69	agreement, the agreement shall appropriately allocate by
70	70	assignment, licensing, or other means 50 percent of the royalties,
71	71	revenue, or other financial benefits to this state for deposit in
72	72	the fund.
73	73	(c) An agreement under this section may include a provision
74	74	specifying that if, as of a date certain provided in the agreement,
75	75	the grant recipient has not used the money received under this
76	76	chapter for the purposes for which the grant was intended, the grant
77	77	recipient shall repay that amount and any related interest
78	78	applicable under the agreement to the coordinating board for
79	79	deposit to the fund at the agreed rate and on the agreed terms.
80	80	Sec. 156.054. AUTHORIZED EXPENSES. Money awarded from the
81	81	fund may be used by the grant recipient to pay any expense
82	82	reasonably related to the purposes described by Section 156.052(a),
83	83	including for research and research capability, salaries and
84	84	benefits, travel, consumable supplies, and equipment.
85	85	Sec. 156.055. PROHIBITED ACTIVITIES. (a) An institution
86	86	of higher education may not knowingly attempt to recruit a person
87	87	described by Section 156.052(a)(1) or (2) who is an individual
88	88	researcher of another institution of higher education.
89	89	(b) An institution of higher education that violates this
90	90	section is ineligible to receive a grant under this chapter before
91	91	the third anniversary of the date the institution last engaged in
92	92	conduct prohibited by this section.
93	93	Sec. 156.056. DOCUMENTATION OF BENEFITS TO STATE. An
94	94	institution of higher education must document specific benefits
95	95	that this state may expect to gain as a result of recruiting
96	96	researchers described by Section 156.052(a)(1) or (2) to the
97	97	institution and enhancing the research capabilities and programs of
98	98	the institution before the institution may enter into an agreement
99	99	to receive a grant under this chapter.
100	100	Sec. 156.057. ANNUAL REPORT. (a) Not later than January 31
101	101	of each year, the coordinating board shall submit to the governor,
102	102	the lieutenant governor, the speaker of the house of
103	103	representatives, and the standing committee of each house of the
104	104	legislature with primary jurisdiction over economic development
105	105	matters a report that includes the following information regarding
106	106	grants awarded under this chapter during the preceding state fiscal
107	107	year:
108	108	(1) the total number and amount of grants awarded; and
109	109	(2) the name of each grant recipient and the amount of
110	110	the grant awarded to the recipient.
111	111	(b) The coordinating board shall post and maintain on the
112	112	coordinating board's Internet website each report submitted under
113	113	this section.
114	114	SECTION 2. Subchapter G, Chapter 404, Government Code, is
115	115	amended by adding Section 404.1031 to read as follows:
116	116	Sec. 404.1031. MANAGEMENT OF INVESTMENT PORTFOLIO FROM
117	117	FORMER TEXAS EMERGING TECHNOLOGY FUND. (a) In this section,
118	118	"state's emerging technology investment portfolio" means:
119	119	(1) the equity positions in the form of stock or other
120	120	security the governor took, on behalf of the state, in companies
121	121	that received awards under the former Texas emerging technology
122	122	fund; and
123	123	(2) any other investments made by the governor, on
124	124	behalf of the state, in connection with an award made under the
125	125	former Texas emerging technology fund.
126	126	(b) The trust company shall manage the state's emerging
127	127	technology investment portfolio in a manner that a prudent investor
128	128	would employ exercising reasonable care, skill, and caution, taking
129	129	into consideration the investment of all assets of the portfolio.
130	130	The trust company may recover its reasonable and necessary costs
131	131	incurred in the management of the portfolio from the earnings on the
132	132	investments in the portfolio.
133	133	(c) Any proceeds or other earnings from the sale of stock or
134	134	other investments in the state's emerging technology investment
135	135	portfolio, less the amount permitted to be retained for payment of
136	136	its costs for managing the portfolio as provided by Subsection (b),
137	137	shall be remitted by the trust company to the comptroller for
138	138	deposit in the general revenue fund.
139	139	SECTION 3. Effective September 1, 2016, Subchapter G,
140	140	Chapter 404, Government Code, is amended by adding Section 404.1032
141	141	to read as follows:
142	142	Sec. 404.1032. VALUATION OF INVESTMENTS FROM FORMER FUND;
143	143	ANNUAL REPORT. (a) To the maximum extent practicable, the trust
144	144	company annually shall perform a valuation of the equity positions
145	145	the governor took, on behalf of the state, in companies that
146	146	received awards under the former Texas emerging technology fund and
147	147	of other investments made by the governor, on behalf of the state,
148	148	in connection with an award under that fund. The valuation must be
149	149	based on a methodology that is consistent with generally accepted
150	150	accounting principles.
151	151	(b) Not later than January 31 of each year, the trust
152	152	company shall submit to the lieutenant governor, the speaker of the
153	153	house of representatives, and the standing committee of each house
154	154	of the legislature with primary jurisdiction over economic
155	155	development matters and post on the office of the trust company's
156	156	Internet website a report of any valuation performed under this
157	157	section during the preceding state fiscal year.
158	158	SECTION 4. Section 481.078, Government Code, is amended by
159	159	adding Subsection (m) to read as follows:
160	160	(m) The office of the governor shall adopt rules for the
161	161	operation of the trusteed program established under this section.
162	162	The rules must include:
163	163	(1) forms and procedures for applications for and
164	164	award of grants;
165	165	(2) procedures for evaluating grant applications;
166	166	(3) provisions governing the grant agreement process;
167	167	and
168	168	(4) methods and procedures for monitoring grant
169	169	recipients and projects or activities for which a grant is awarded
170	170	from the fund to determine whether and to what extent the grant
171	171	recipients comply with job creation performance targets, capital
172	172	investment commitments, or other specified performance targets in
173	173	the grant agreement.
174	174	SECTION 5. The heading to Chapter 490, Government Code, is
175	175	amended to read as follows:
176	176	CHAPTER 490. PROVISIONS RELATING TO FORMER TEXAS [FUNDING FOR]
177	177	EMERGING TECHNOLOGY FUND
178	178	SECTION 6. Sections 490.001(2) and (4), Government Code,
179	179	are amended to read as follows:
180	180	(2) "Fund" means the former Texas emerging technology
181	181	fund.
182	182	(4) "Award" means:
183	183	(A) for purposes of former Subchapter D, an
184	184	investment in the form of equity or a convertible note;
185	185	(B) for purposes of former Subchapter E, an
186	186	investment in the form of a debt instrument;
187	187	(C) for purposes of former Subchapter F, a grant;
188	188	or
189	189	(D) other forms of contribution or investment as
190	190	recommended by the former Texas Emerging Technology Advisory
191	191	Committee [committee] and approved by the governor, lieutenant
192	192	governor, and speaker of the house of representatives before
193	193	amendment of this chapter by the 84th Legislature, Regular Session,
194	194	2015.
195	195	SECTION 7. The heading to Section 490.005, Government Code,
196	196	is amended to read as follows:
197	197	Sec. 490.005. REPORT ON AWARDS FROM FORMER FUND [ANNUAL
198	198	REPORT].
199	199	SECTION 8. Section 490.005, Government Code, is amended by
200	200	amending Subsections (a) and (b) and adding Subsection (d) to read
201	201	as follows:
202	202	(a) Not later than January 31, 2016 [of each year], the
203	203	governor shall submit to the lieutenant governor, the speaker of
204	204	the house of representatives, and the standing committee of each
205	205	house of the legislature with primary jurisdiction over economic
206	206	development matters and post on the office of the governor's
207	207	Internet website a report that includes for each preceding state
208	208	fiscal year the following information regarding awards made under
209	209	the fund [during each preceding state fiscal year]:
210	210	(1) the total number and amount of awards made;
211	211	(2) the number and amount of awards made under former
212	212	Subchapters D, E, and F;
213	213	(3) the aggregate total of private sector investment,
214	214	federal government funding, and contributions from other sources
215	215	obtained in connection with awards made under each of the
216	216	subchapters listed in Subdivision (2);
217	217	(4) the name of each award recipient and the amount of
218	218	the award made to the recipient; and
219	219	(5) a brief description of the equity position that
220	220	the governor, on behalf of the state, has taken [may take] in
221	221	companies that received [receiving] awards and the names of the
222	222	companies in which the state has taken an equity position.
223	223	(b) The [annual] report must also contain:
224	224	(1) the total number of jobs actually created by each
225	225	project that received an award from the fund [receiving funding
226	226	under this chapter];
227	227	(2) an analysis of the number of jobs actually created
228	228	by each project that received an award from the fund [receiving
229	229	funding under this chapter]; and
230	230	(3) a brief description regarding:
231	231	(A) the methodology used to determine the
232	232	information provided under Subdivisions (1) and (2), which may be
233	233	developed in consultation with the comptroller's office;
234	234	(B) the intended outcomes of projects funded
235	235	under former Subchapter D [during each preceding state fiscal
236	236	year]; and
237	237	(C) the actual outcomes of all projects funded
238	238	under former Subchapter D [during each preceding state fiscal
239	239	year], including any financial impact on the state resulting from a
240	240	liquidity event involving a company whose project was funded under
241	241	that subchapter.
242	242	(d) This section expires September 1, 2017.
243	243	SECTION 9. Effective September 1, 2016, Subchapter A,
244	244	Chapter 490, Government Code, is amended by adding Section 490.0051
245	245	to read as follows:
246	246	Sec. 490.0051. ANNUAL REPORT ON PROJECTS FUNDED; JOB
247	247	CREATION AND OUTCOMES. (a) Not later than January 31 of each year,
248	248	the governor shall submit to the lieutenant governor, the speaker
249	249	of the house of representatives, and the standing committee of each
250	250	house of the legislature with primary jurisdiction over economic
251	251	development matters and post on the office of the governor's
252	252	Internet website a report that contains for each preceding state
253	253	fiscal year the following information regarding awards made under
254	254	the fund:
255	255	(1) the total number of jobs actually created by each
256	256	project that received an award from the fund;
257	257	(2) an analysis of the number of jobs actually created
258	258	by each project that received an award from the fund; and
259	259	(3) a brief description regarding:
260	260	(A) the methodology used to determine the
261	261	information provided under Subdivisions (1) and (2), which may be
262	262	developed in consultation with the comptroller's office;
263	263	(B) the intended outcomes of all projects funded
264	264	under former Subchapter D; and
265	265	(C) the actual outcomes of all projects funded
266	266	under former Subchapter D, including any financial impact on the
267	267	state resulting from a liquidity event involving a company whose
268	268	project was funded under that subchapter.
269	269	(b) The governor shall exclude from the report information
270	270	that is made confidential by law.
271	271	(c) This section expires September 1, 2030.
272	272	SECTION 10. Section 490.006, Government Code, is amended to
273	273	read as follows:
274	274	Sec. 490.006. VALUATION OF INVESTMENTS; [INCLUSION IN]
275	275	ANNUAL REPORT. (a) To the maximum extent practicable, the office
276	276	of the governor shall annually perform a valuation of the equity
277	277	positions taken by the governor, on behalf of the state, in
278	278	companies that received [receiving] awards under the fund and of
279	279	other investments made by the governor, on behalf of the state, in
280	280	connection with an award under the fund. The valuation must[:
281	281	[(1)] be based on a methodology that:
282	282	(1) [(A)] may be developed in consultation with the
283	283	comptroller's office; and
284	284	(2) [(B)] is consistent with generally accepted
285	285	accounting principles[; and
286	286	[(2) be included with the annual report required under
287	287	Section 490.005].
288	288	(b) Except as provided by Subsection (c), not later than
289	289	January 31, 2016, the governor shall submit to the lieutenant
290	290	governor, the speaker of the house of representatives, and the
291	291	standing committee of each house of the legislature with primary
292	292	jurisdiction over economic development matters and post on the
293	293	office of the governor's Internet website a report of any valuation
294	294	performed under this section during the preceding state fiscal
295	295	year.
296	296	(c) A valuation performed for the state fiscal year ending
297	297	August 31, 2015, must be included with the report required under
298	298	Section 490.005.
299	299	(d) This section expires September 1, 2016.
300	300	SECTION 11. The heading to Subchapter B, Chapter 490,
301	301	Government Code, is amended to read as follows:
302	302	SUBCHAPTER B. MISCELLANEOUS PROVISIONS [TEXAS EMERGING TECHNOLOGY
303	303	ADVISORY COMMITTEE]
304	304	SECTION 12. Section 490.057, Government Code, is amended to
305	305	read as follows:
306	306	Sec. 490.057. CONFIDENTIALITY. (a) Except as provided by
307	307	Subsection (b), information collected by the governor's office, the
308	308	former Texas Emerging Technology Advisory Committee [committee],
309	309	or the committee's advisory panels concerning the identity,
310	310	background, finance, marketing plans, trade secrets, or other
311	311	commercially or academically sensitive information of an
312	312	individual or entity that was [being] considered for or [,
313	313	receiving, or having] received an award from the fund is
314	314	confidential unless the individual or entity consents to disclosure
315	315	of the information.
316	316	(b) The following information collected by the governor's
317	317	office, the former Texas Emerging Technology Advisory Committee
318	318	[committee], or the committee's advisory panels under this chapter
319	319	is public information and may be disclosed under Chapter 552:
320	320	(1) the name and address of an individual or entity
321	321	that [receiving or having] received an award from the fund;
322	322	(2) the amount of funding received by an award
323	323	recipient;
324	324	(3) a brief description of the project [that is]
325	325	funded under this chapter;
326	326	(4) if applicable, a brief description of the equity
327	327	position that the governor, on behalf of the state, has taken in an
328	328	entity that [has] received an award from the fund; and
329	329	(5) any other information designated by the committee
330	330	with the consent of:
331	331	(A) the individual or entity that [receiving or
332	332	having] received an award from the fund[, as applicable];
333	333	(B) the governor;
334	334	(C) the lieutenant governor; and
335	335	(D) the speaker of the house of representatives.
336	336	SECTION 13. Section 50D.013(a), Agriculture Code, is
337	337	amended to read as follows:
338	338	(a) The policy council shall:
339	339	(1) provide a vision for unifying this state's
340	340	agricultural, energy, and research strengths in a successful launch
341	341	of a cellulosic biofuel and bioenergy industry;
342	342	(2) foster development of cellulosic-based and
343	343	bio-based fuels and build on the former Texas emerging technology
344	344	fund's investments in leading-edge energy research and efforts to
345	345	commercialize the production of bioenergy;
346	346	(3) pursue the creation of a next-generation biofuels
347	347	energy research program at a university in this state;
348	348	(4) work to procure federal and other funding to aid
349	349	this state in becoming a bioenergy leader;
350	350	(5) study the feasibility and economic development
351	351	effect of a blending requirement for biodiesel or cellulosic fuels;
352	352	(6) pursue the development and use of thermochemical
353	353	process technologies to produce alternative chemical feedstocks;
354	354	(7) study the feasibility and economic development of
355	355	the requirements for pipeline-quality, renewable natural gas; and
356	356	(8) perform other advisory duties as requested by the
357	357	commissioner regarding the responsible development of bioenergy
358	358	resources in this state.
359	359	SECTION 14. Section 203.021(e), Labor Code, is amended to
360	360	read as follows:
361	361	(e) Money in the compensation fund may not be transferred to
362	362	the[:
363	363	[(1)] Texas Enterprise Fund created under Section
364	364	481.078, Government Code[; or
365	365	[(2) Texas emerging technology fund established under
366	366	Section 490.101, Government Code].
367	367	SECTION 15. The following laws are repealed:
368	368	(1) Sections 490.001(1), (3), and (5), Government
369	369	Code;
370	370	(2) Sections 490.002 and 490.003, Government Code;
371	371	(3) Sections 490.051, 490.052, 490.0521, 490.053,
372	372	490.054, 490.055, and 490.056, Government Code; and
373	373	(4) Subchapters C, D, E, F, and G, Chapter 490,
374	374	Government Code.
375	375	SECTION 16. (a) On September 1, 2015, the Texas emerging
376	376	technology fund is abolished and, except as provided by Subsections
377	377	(c) and (d) of this section, the comptroller shall transfer the
378	378	unencumbered balance of the fund as follows:
379	379	(1) 50 percent of the balance to the credit of the
380	380	Texas Enterprise Fund under Section 481.078, Government Code; and
381	381	(2) 50 percent of the balance to the credit of the
382	382	university research initiative fund under Subchapter B, Chapter
383	383	156, Education Code, as added by this Act.
384	384	(b) The abolishment by this Act of the Texas emerging
385	385	technology fund and the repeal of provisions of Chapter 490,
386	386	Government Code, relating to that fund do not affect the validity of
387	387	an agreement between the governor and an award recipient or a person
388	388	to be awarded money that is entered into under Chapter 490 before
389	389	September 1, 2015.
390	390	(c) Money that was deposited in the Texas emerging
391	391	technology fund as a gift, grant, or donation under Chapter 490,
392	392	Government Code, and that is encumbered by the specific terms of the
393	393	gift, grant, or donation may be spent only in accordance with the
394	394	terms of the gift, grant, or donation.
395	395	(d) Money from the Texas emerging technology fund that is
396	396	encumbered because the money is awarded or otherwise obligated by
397	397	agreement before September 1, 2015, but under the terms of the award
398	398	or agreement will not be distributed until a later date shall be
399	399	distributed in accordance with the terms of the award or agreement.
400	400	If the governor determines that the money will not be distributed in
401	401	accordance with the terms of the award or agreement, the governor
402	402	shall certify that fact to the comptroller. On that certification,
403	403	the comptroller shall make that money available in the general
404	404	revenue fund to be used in accordance with legislative
405	405	appropriation.
406	406	(e) On or after the effective date of this Act, subject to
407	407	any amounts used to recover costs under Section 404.1031(b),
408	408	Government Code, as added by this Act, the following payments or
409	409	other amounts shall be sent to the comptroller for deposit to the
410	410	general revenue fund:
411	411	(1) any royalties, revenues, and other financial
412	412	benefits realized from a project undertaken with money from the
413	413	Texas emerging technology fund, as provided by a contract described
414	414	by former Section 490.103, Government Code;
415	415	(2) any interest or proceeds received as a result of a
416	416	transaction authorized by former Section 490.101(h), Government
417	417	Code;
418	418	(3) any money returned or repaid to the state by an
419	419	award recipient pursuant to an agreement entered into under former
420	420	Section 490.101, Government Code;
421	421	(4) any money derived from an interest the state
422	422	retained in a capital improvement pursuant to an agreement entered
423	423	into under former Section 490.101, Government Code; and
424	424	(5) any fund money returned by an entity that fails to
425	425	perform an action guaranteed by a contract entered into under
426	426	former Section 490.154 or 490.203, Government Code.
427	427	SECTION 17. A regional center of innovation and
428	428	commercialization established under Section 490.152, Government
429	429	Code, is abolished on the effective date of this Act. Each center
430	430	shall transfer to the office of the governor a copy of any meeting
431	431	minutes required to be retained under Section 490.1521, Government
432	432	Code, as that section existed immediately before that section's
433	433	repeal by this Act, and the office shall retain the minutes for the
434	434	period prescribed by that section.
435	435	SECTION 18. On September 1, 2015, the Texas Emerging
436	436	Technology Advisory Committee established under Subchapter B,
437	437	Chapter 490, Government Code, is abolished.
438	438	SECTION 19. Except as provided by this Act, on September 1,
439	439	2015, the following powers, duties, functions, and activities
440	440	performed by the office of the governor immediately before that
441	441	date are transferred to the Texas Treasury Safekeeping Trust
442	442	Company:
443	443	(1) all powers, duties, functions, and activities
444	444	related to equity positions in the form of stock or other security
445	445	the governor has taken, on behalf of the state, in companies that
446	446	received awards under the Texas emerging technology fund before
447	447	September 1, 2015; and
448	448	(2) all powers, duties, functions, and activities
449	449	related to other investments made by the governor, on behalf of the
450	450	state, in connection with an award made under the Texas emerging
451	451	technology fund before September 1, 2015.
452	452	SECTION 20. If a conflict exists between this Act and
453	453	another Act of the 84th Legislature, Regular Session, 2015, that
454	454	relates to the Texas emerging technology fund, this Act controls
455	455	without regard to the relative dates of enactment.
456	456	SECTION 21. Except as otherwise provided by this Act, this
457	457	Act takes effect September 1, 2015.