By: Hinojosa S.B. No. 1875
A BILL TO BE ENTITLED
AN ACT
relating to the self-directed and semi-independent status of
certain agencies and the requirements applicable to, and the
oversight of, those agencies.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 472.104(b), Government Code, is amended
to read as follows:
(b) In addition to the reporting requirements of Subsection
(a), [each agency shall report annually,] not later than November 1
of each year, each agency shall submit the report required under
Section 473.101[, to the governor, to the committee of each house of
the legislature that has jurisdiction over appropriations, and to
the Legislative Budget Board the following:
[(1) the salary for all agency personnel and the total
amount of per diem expenses and travel expenses paid for all agency
employees, including trend performance data for the preceding five
fiscal years;
[(2) the total amount of per diem expenses and travel
expenses paid for each member of the governing body of each agency,
including trend performance data for the preceding five fiscal
years;
[(3) each agency's operating plan covering a period of
two fiscal years;
[(4) each agency's operating budget, including
revenues and a breakdown of expenditures by program and
administrative expenses, showing:
[(A) projected budget data for a period of two
fiscal years; and
[(B) trend performance data for the preceding
five fiscal years; and
[(5) trend performance data for the preceding five
fiscal years regarding:
[(A) the number of full-time equivalent
positions at the agency;
[(B) the number of complaints received from the
public and the number of complaints initiated by agency staff;
[(C) the number of complaints dismissed and the
number of complaints resolved by enforcement action;
[(D) the number of enforcement actions by
sanction type;
[(E) the number of enforcement cases closed
through voluntary compliance;
[(F) the amount of administrative penalties
assessed and the rate of collection of assessed administrative
penalties;
[(G) the number of enforcement cases that allege
a threat to public health, safety, or welfare or a violation of
professional standards of care and the disposition of those cases;
[(H) the average time to resolve a complaint;
[(I) the number of license holders or regulated
persons broken down by type of license and license status,
including inactive status or retired status;
[(J) the fee charged to issue and renew each type
of license, certificate, permit, or other similar authorization
issued by the agency;
[(K) the average time to issue a license;
[(L) litigation costs, broken down by
administrative hearings, judicial proceedings, and outside counsel
costs; and
[(M) reserve fund balances].
SECTION 2. Subtitle E, Title 4, Government Code, is amended
by adding Chapter 473 to read as follows:
CHAPTER 473. PROVISIONS GENERALLY APPLICABLE TO SELF-DIRECTED AND
SEMI-INDEPENDENT AGENCIES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 473.001. DEFINITIONS. In this chapter:
(1) "Agency" means a state agency that:
(A) is self-directed and semi-independent under
the laws of this state; or
(B) is seeking self-directed and
semi-independent agency status.
(2) "Board" means the Legislative Budget Board.
Sec. 473.002. ROLE OF BOARD; RECOVERY OF COSTS. (a) The
board has responsibility under this chapter for developing and
administering the application process, monitoring agencies, and
performing other duties provided under this chapter.
(b) The board may recover from an agency the costs
associated with administering the application process for the
agency and the board's monitoring of the agency.
Sec. 473.003. REVIEW OF LEGISLATION; REPORT. (a) The
board's staff shall review legislation passed in each regular or
special legislative session that:
(1) grants a state agency self-directed and
semi-independent status; or
(2) amends a provision of this chapter or any other law
that relates to a state agency's self-directed and semi-independent
status.
(b) Not later than December 1 of each even-numbered year,
the board's staff shall submit a report to the committee of each
house of the legislature that has jurisdiction over appropriations
that includes:
(1) a list of all state agencies granted self-directed
and semi-independent status during the preceding regular or special
session of the legislature; and
(2) recommendations by the board's staff to address
potential problems identified by the staff during the review
prescribed by Subsection (a).
SUBCHAPTER B. APPLICATION FOR SELF-DIRECTED AND SEMI-INDEPENDENT
AGENCY STATUS
Sec. 473.051. APPLICATION; AUDIT REQUIRED. (a) Before an
agency may be granted self-directed and semi-independent status,
the agency must:
(1) submit an application to the board; and
(2) undergo a financial audit and an effectiveness
audit as required under Subsection (e).
(b) A state agency may not submit the application required
under Subsection (a) until the agency's governing body:
(1) provides notice and holds a public hearing on the
application; and
(2) approves, by majority vote, the submission of the
application.
(c) The application must be submitted to the board as part
of the agency's legislative appropriations request.
(d) The board shall prescribe an application form that
requires the agency applying for self-directed and
semi-independent status to:
(1) state the reasons for which the agency is seeking
self-directed and semi-independent status and address any
potential problems that may result from granting that status; and
(2) include, as relevant to the agency's application:
(A) information demonstrating the agency's
history of efficient operation and continuing ability to operate
efficiently and in a manner that protects the public interest;
(B) documentation of adequate budgetary
processes and controls; and
(C) an analysis of the fiscal effect on state
revenue and other state agencies demonstrating that the agency's
status as self-directed and semi-independent would be
revenue-neutral.
(e) A state agency must undergo a financial audit and an
effectiveness audit by the state auditor during the four-year
period preceding the date the agency submits an application under
Subsection (a). The state auditor shall conduct the financial
audit and effectiveness audit and make the findings of the
completed audits available to the board.
(f) The board may require an agency to submit additional
information necessary to evaluate the agency's ability to operate
effectively as a self-directed and semi-independent agency.
Sec. 473.052. REVIEW OF APPLICATION; RECOMMENDATION.
(a) The board's staff shall promptly review an application
submitted under Section 473.051. The staff review shall determine
whether the agency's application is sufficient and whether the
agency's application should be granted or denied.
(b) The board's staff shall submit the staff's
recommendation as to whether the agency's application should be
granted or denied to the board. The board may recommend to the
committee of each house of the legislature that has jurisdiction
over appropriations that legislation be introduced to grant
self-directed and semi-independent status to the agency.
SUBCHAPTER C. REPORTING REQUIREMENTS; AUDITS
Sec. 473.101. ANNUAL REPORT. (a) In addition to any other
report required by law, not later than November 1 of each year, each
self-directed and semi-independent agency shall report in the form
prescribed by the board to the governor, the committee of each house
of the legislature that has jurisdiction over appropriations, and
the board the following:
(1) the salary for all agency personnel and the total
amount of per diem expenses and travel expenses paid for all agency
employees, including trend performance data for the preceding five
fiscal years;
(2) the total amount of per diem expenses and travel
expenses paid for each member of the governing body of each agency,
including trend performance data for the preceding five fiscal
years;
(3) each agency's operating plan covering a period of
two fiscal years;
(4) each agency's operating budget, including revenues
from all sources, an accounting of all expenditures, and a
breakdown of expenditures by program and administrative expenses,
showing:
(A) projected budget data for a period of two
fiscal years; and
(B) trend performance data for the preceding five
fiscal years;
(5) the purchase or sale of any real property during
the preceding year;
(6) any lease and maintenance costs associated with
real property owned or leased by the agency;
(7) for an agency other than a financial regulatory
agency as defined by Section 16.001, Finance Code, trend
performance data for the preceding five fiscal years regarding:
(A) the number of full-time equivalent positions
at the agency;
(B) the number of complaints received from the
public and the number of complaints initiated by agency staff;
(C) the number of complaints dismissed and the
number of complaints resolved by enforcement action;
(D) the number of enforcement actions, by
sanction type;
(E) the number of enforcement cases closed
through voluntary compliance;
(F) the amount of administrative penalties
assessed and the rate of collection of assessed administrative
penalties;
(G) the number of enforcement cases that allege a
threat to public health, safety, or welfare or a violation of
professional standards of care and the disposition of those cases;
(H) the average time to resolve a complaint;
(I) the number of license holders or regulated
persons, broken down by type of license and license status,
including inactive status or retired status;
(J) the fee charged to issue and renew each type
of license, certificate, permit, or other similar authorization
issued by the agency;
(K) the average time to issue a license;
(L) litigation costs, broken down by
administrative hearings, judicial proceedings, and outside counsel
costs; and
(M) reserve fund balances; and
(8) for a financial regulatory agency as defined by
Section 16.001, Finance Code, trend performance data for the
preceding five fiscal years regarding:
(A) the number of full-time equivalent positions
at the agency;
(B) the number of complaints received;
(C) the number of complaints dismissed or
resolved and, of those complaints, the number resolved by
enforcement action;
(D) the number of enforcement actions, by type;
(E) the amount of administrative penalties
assessed and the amount of administrative penalties collected;
(F) the number of entities regulated by the
agency;
(G) the fee charged to issue and renew each type
of license, certificate, permit, or other similar authorization
issued by the agency, or any assessments paid to the agency by the
holder of a license, certificate, permit, or other similar
authorization issued by the agency;
(H) litigation costs, broken down by
administrative hearings, judicial proceedings, and outside counsel
costs;
(I) reserve fund balances; and
(J) the key performance measures approved by the
governing board of the agency during the fiscal year for which the
report is due.
(b) If, based on a review of an agency's annual report
submitted as required under Subsection (a), the board determines
that additional information is necessary to address an issue
identified during the review, the board may require an agency to
submit information to the board demonstrating the agency's:
(1) ability to perform those duties that are required
of the agency by its enabling statute or a related duty contained in
another law;
(2) financial soundness, including the agency's
ability to raise sufficient revenue, maintain sufficient operating
reserves, and meet all of the agency's financial obligations;
(3) compliance with the provisions of this chapter;
and
(4) satisfactory audit history, including a summary of
any corrective action taken by the agency in response to an audit.
Sec. 473.102. AUDITS. (a) In addition to any other audit
required by law, the state auditor shall conduct a financial audit
and an effectiveness audit of a self-directed and semi-independent
agency at least once every six years, unless the state auditor
determines that the auditor may rely on an independent audit of the
agency conducted during the same period. The state auditor may
conduct a risk-based audit of a self-directed and semi-independent
agency at any time.
(b) The agency shall reimburse the state auditor for costs
incurred in performing an audit under this section.
SUBCHAPTER D. REVIEW OF SELF-DIRECTED AND SEMI-INDEPENDENT
AGENCIES; REVOCATION OF STATUS
Sec. 473.151. REVIEW OF AGENCIES. (a) The board's staff
and the board shall review each agency's annual report submitted
under Section 473.101 and any additional information requested by
the board and received from the agency to determine the agency's
compliance with this chapter.
(b) The board's staff may make a recommendation to the
committee of each house of the legislature that has jurisdiction
over appropriations and to the legislature to address issues
identified during a review conducted under this section, except
that the staff may not recommend the revocation of an agency's
self-directed and semi-independent status.
(c) The board may recommend that legislation be introduced
to revoke an agency's self-directed and semi-independent status or
otherwise address issues raised by the board. A recommendation to
revoke an agency's self-directed and semi-independent status may be
based on the agency's conduct, including:
(1) material abuse by the agency of its self-directed
and semi-independent status; or
(2) fiscal mismanagement.
Sec. 473.152. REVOCATION OF STATUS. (a) The board may
develop criteria for determining when a recommendation for the
revocation of an agency's self-directed and semi-independent
status is appropriate. The board may recommend the revocation of an
agency's self-directed and semi-independent status to the
legislature as provided by Section 473.151(c). If the board
recommends revocation of an agency's self-directed and
semi-independent status, the agency shall have the opportunity to
respond in writing to that recommendation.
(b) The Sunset Advisory Commission may recommend revocation
of an agency's self-directed and semi-independent status to the
legislature as part of the commission's periodic review of the
agency under Chapter 325 (Texas Sunset Act).
(c) The legislature may consider legislation to revoke an
agency's self-directed and semi-independent status regardless of
whether the revocation is recommended by the board or the Sunset
Advisory Commission.
(d) The board shall assist an agency in transitioning from
self-directed and semi-independent status if the agency's status is
revoked. The board may consider issues relating to appropriations
and financial planning for the agency, and an evaluation of the
status and disposition of agency contracts, facilities,
properties, and leases when assisting an agency under this
subsection.
SECTION 3. Section 16.005(c), Finance Code, is amended to
read as follows:
(c) In addition to the reporting requirements of Subsection
(b), not later than November 1 of each year, each financial
regulatory agency shall submit the report required under Section
473.101, Government Code [to the governor, the committee of each
house of the legislature that has jurisdiction over appropriations,
and the Legislative Budget Board a report that contains:
[(1) the salary for all financial regulatory agency
personnel and the total amount of per diem expenses and travel
expenses paid for all agency employees;
[(2) the total amount of per diem expenses and travel
expenses paid for each member of the agency's policy-making body,
provided that only one report must be submitted regarding the
Finance Commission of Texas;
[(3) the agency's operating plan and annual budget;
and
[(4) a detailed report of all revenue received and all
expenses incurred by the financial regulatory agency in the
previous 12 months].
SECTION 4. Section 1105.001, Occupations Code, is amended
to read as follows:
Sec. 1105.001. DEFINITIONS. In this chapter [section]:
(1) "Agency" means the commission and the board.
(2) "Board" means the Texas Appraiser Licensing and
Certification Board.
(3) "Commission" means the Texas Real Estate
Commission.
SECTION 5. Section 1105.005(c), Occupations Code, is
amended to read as follows:
(c) In addition to the reporting requirements of Subsection
(b), not later than November 1 of each year, the agency shall submit
the report required under Section 473.101, Government Code [to the
governor, the committee of each house of the legislature that has
jurisdiction over appropriations, and the Legislative Budget Board
a report that contains:
[(1) the salary for all agency personnel and the total
amount of per diem expenses and travel expenses paid for all agency
employees;
[(2) the total amount of per diem expenses and travel
expenses paid for each member of the agency;
[(3) the agency's operating plan and the annual
budgets of the commission and the board; and
[(4) a detailed report of all revenue received and all
expenses incurred by the agency in the previous 12 months].
SECTION 6. Section 16.005, Finance Code, Section 472.104,
Government Code, and Section 1105.005, Occupations Code, as amended
by this Act, and Section 473.101, Government Code, as added by this
Act, apply only to a report originally due on or after the effective
date of this Act. A report originally due before the effective date
of this Act is governed by the law in effect on the date the report
was originally due, and the former law is continued in effect for
that purpose.
SECTION 7. Section 473.051, Government Code, as added by
this Act, does not require a state agency that, on the effective
date of this Act, is self-directed and semi-independent to submit
an application to the Legislative Budget Board seeking
self-directed and semi-independent agency status.
SECTION 8. This Act takes effect September 1, 2017.