86R8693 JG-D
By: Davis of Harris H.B. No. 1877
A BILL TO BE ENTITLED
AN ACT
relating to the ethics of public servants, including regulations
relating to certain contributions, expenditures, and reports, and
certain authority and duties of the Texas Ethics Commission;
creating a criminal offense.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 251.005(d), Election Code, is amended to
read as follows:
(d) An out-of-state political committee that does not file a
campaign treasurer appointment shall comply with Sections
[Section] 254.1581, 254.161, and 254.261.
SECTION 2. Subchapter A, Chapter 253, Election Code, is
amended by adding Section 253.006 to read as follows:
Sec. 253.006. UNLAWFUL USE OF PUBLIC FUNDS FOR
CONTRIBUTIONS OR EXPENDITURES. (a) An officer or employee of a
political subdivision may not spend or authorize the spending of
public funds to make a political contribution or a political
expenditure.
(b) An officer or employee of a political subdivision may
not directly or indirectly employ a person to use public funds to
make an unlawful political contribution or political expenditure.
(c) A person who violates Subsection (a) or (b) commits an
offense. An offense under this section is a Class A misdemeanor.
SECTION 3. Subchapter D, Chapter 253, Election Code, is
amended by adding Section 253.105 to read as follows:
Sec. 253.105. CONTRIBUTIONS TO DIRECT EXPENDITURE ONLY
COMMITTEES. A corporation or labor organization may make a
political contribution from its own property to a political
committee that:
(1) is not established or controlled by a candidate or
an officeholder;
(2) makes or intends to make direct campaign
expenditures;
(3) does not make or intend to make political
contributions to:
(A) a candidate;
(B) an officeholder;
(C) a specific-purpose committee established or
controlled by a candidate or an officeholder; or
(D) a political committee that makes or intends
to make political contributions to a candidate, an officeholder, or
a specific-purpose committee established or controlled by a
candidate or an officeholder; and
(4) has filed an affidavit with the commission stating
the committee's intention to operate as described by Subdivisions
(2) and (3).
SECTION 4. Section 254.161, Election Code, is amended to
read as follows:
Sec. 254.161. NOTICE TO CANDIDATE AND OFFICEHOLDER OF
CONTRIBUTIONS AND EXPENDITURES. If a general-purpose committee
other than the principal political committee of a political party
or a political committee established by a political party's county
executive committee accepts political contributions or makes
political expenditures for a candidate or officeholder, notice of
that fact shall be given to the affected candidate or officeholder
as provided by Section 254.128 for a specific-purpose committee.
An out-of-state political committee that is required to comply with
this section shall designate an officer of the committee to provide
the notice.
SECTION 5. Section 254.261, Election Code, is amended by
adding Subsection (e) to read as follows:
(e) This section applies to an out-of-state political
committee that does not file a campaign treasurer appointment.
SECTION 6. Section 302.021(a), Government Code, is amended
to read as follows:
(a) A speaker candidate or former speaker candidate commits
an offense if the person:
(1) knowingly fails to file the declaration of
candidacy required by Section 302.0121;
(2) knowingly fails to file the statement required by
Section 302.013;
(3) knowingly accepts a contribution, loan, or promise
of a contribution or loan in violation of Section 302.0121(c);
(4) [knowingly accepts a contribution, loan, or
promise of a contribution or loan prohibited by Section 302.017
from a corporation, partnership, association, firm, union,
foundation, committee, club, or other organization or group of
persons;
[(5)] knowingly accepts a contribution from a person
who uses political contributions, interest earned on political
contributions, or an asset purchased with political contributions
to make the contribution in violation of Section 302.0191;
(5) [(6)] expends campaign funds for any purpose other
than those enumerated in Section 302.020;
(6) [(7)] knowingly retains contributions, assets
purchased with contributions, or interest or other income earned on
contributions in violation of Section 302.0201(b); or
(7) [(8)] knowingly fails to file the report of
unexpended campaign funds as required by Section 302.0201(d).
SECTION 7. Subchapter B, Chapter 571, Government Code, is
amended by adding Section 571.033 to read as follows:
Sec. 571.033. NOTIFICATION PROCEDURES. (a) Except as
provided by Subsection (b), the commission may adopt rules
prescribing how the commission will notify any person or provide
any notice required by this subtitle, Chapter 305 of this code, or
Title 15, Election Code.
(b) Subsection (a) does not authorize the commission to
adopt rules prescribing how the commission will notify any person
or provide any notice required by Subchapter E or F of this chapter
or how the commission will issue a warning of liability under
Section 254.042(b), Election Code.
SECTION 8. Section 571.071, Government Code, is amended by
amending Subsection (c) and adding Subsection (d) to read as
follows:
(c) The commission may provide a seminar for persons
required to register under Chapter 305 that addresses issues
involving lobbying, political contributions and expenditures, and
other issues as determined by the commission. The commission may
charge a fee for attending the seminar in an amount necessary to
cover the costs associated with the seminar, including the cost of
providing food or nonalcoholic beverages to attendees.
(d) The commission may provide a seminar that addresses the
laws administered and enforced by the commission and any other
relevant laws, as determined by the commission. The commission may
charge a fee for attending the seminar in an amount necessary to
cover the costs associated with the seminar, including the cost of
providing food or nonalcoholic beverages to attendees.
SECTION 9. Section 572.023(b), Government Code, is amended
to read as follows:
(b) The account of financial activity consists of:
(1) a list of all sources of occupational income,
identified by employer, or if self-employed, by the nature of the
occupation, including identification of a person or other
organization from which the individual or a business in which the
individual has a substantial interest received a fee as a retainer
for a claim on future services in case of need, as distinguished
from a fee for services on a matter specified at the time of
contracting for or receiving the fee, if professional or
occupational services are not actually performed during the
reporting period equal to or in excess of the amount of the
retainer, and the category of the amount of the fee;
(2) identification by name and the category of the
greatest number of shares of stock of any nonpublicly traded
business entity held or acquired, and if sold, the category of the
amount of net gain or loss realized from the sale;
(2-a) identification by stock symbol and the category
of the number of shares of stock of any publicly traded corporation
held;
(3) a list of all bonds, notes, and other commercial
paper held or acquired, and if sold, the category of the amount of
net gain or loss realized from the sale;
(4) identification of each source and the category of
the amount of income in excess of $500 derived from each source from
interest, dividends, royalties, and rents;
(5) identification of each guarantor of a loan and
identification of each person or financial institution to whom a
personal note or notes or lease agreement for a total financial
liability in excess of $1,000 existed at any time during the year
and the category of the amount of the liability;
(6) identification by description of all beneficial
interests in real property and business entities held or acquired,
and if sold, the category of the amount of the net gain or loss
realized from the sale;
(7) identification of a person or other organization
from which the individual or the individual's spouse or dependent
children received a gift of anything of value in excess of $250 and
a description of each gift, except:
(A) a gift received from an individual related to
the individual at any time within the second degree by
consanguinity or affinity, as determined under Subchapter B,
Chapter 573;
(B) a political contribution that was reported as
required by Chapter 254, Election Code; and
(C) an expenditure required to be reported by a
person required to be registered under Chapter 305;
(8) identification of the source and the category of
the amount of all income received as beneficiary of a trust, other
than a blind trust that complies with Subsection (c), and
identification of each trust asset, if known to the beneficiary,
from which income was received by the beneficiary in excess of $500;
(9) identification:
(A) by description of a corporation, firm,
partnership, limited partnership, limited liability partnership,
professional corporation, professional association, joint venture,
or other business association in which five percent or more of the
outstanding ownership was held, acquired, or sold; and
(B) by description and the category of the amount
of all assets and liabilities of a corporation, firm, partnership,
limited partnership, limited liability partnership, professional
corporation, professional association, joint venture, or other
business association in which 50 percent or more of the outstanding
ownership was held, acquired, or sold;
(10) a list of all boards of directors of which the
individual is a member and executive positions that the individual
holds in corporations, firms, partnerships, limited partnerships,
limited liability partnerships, professional corporations,
professional associations, joint ventures, or other business
associations or proprietorships, stating the name of each
corporation, firm, partnership, limited partnership, limited
liability partnership, professional corporation, professional
association, joint venture, or other business association or
proprietorship and the position held;
(11) identification of any person providing
transportation, meals, or lodging expenses permitted under Section
36.07(b), Penal Code, and the amount of those expenses, other than
expenditures required to be reported under Chapter 305;
(12) any corporation, firm, partnership, limited
partnership, limited liability partnership, professional
corporation, professional association, joint venture, or other
business association, excluding a publicly held corporation, in
which both the individual and a person registered under Chapter 305
have an interest;
(13) identification by name and the category of the
number of shares of any mutual fund held or acquired, and if sold,
the category of the amount of net gain or loss realized from the
sale;
(14) identification of each blind trust that complies
with Subsection (c), including:
(A) the category of the fair market value of the
trust;
(B) the date the trust was created;
(C) the name and address of the trustee; and
(D) a statement signed by the trustee, under
penalty of perjury, stating that:
(i) the trustee has not revealed any
information to the individual, except information that may be
disclosed under Subdivision (8); and
(ii) to the best of the trustee's knowledge,
the trust complies with this section;
(15) if the aggregate cost of goods or services sold
under one or more written contracts described by this subdivision
exceeds $10,000 in the year covered by the report, identification
of each written contract, including the name of each party to the
contract:
(A) for the sale of goods or services in the
amount of $2,500 or more;
(B) to which the individual, the individual's
spouse, the individual's dependent child, or any business entity of
which the individual, the individual's spouse, or the individual's
dependent child, independently or in conjunction with one or more
persons described by this subsection, has at least a 50 percent
ownership interest is a party; and
(C) with:
(i) a governmental entity; or
(ii) a person who contracts with a
governmental entity, if the individual or entity described by
Paragraph (B) performs work arising out of the contract,
subcontract, or agreement between the person and the governmental
entity for a fee; and
(16) if the individual is a member of the legislature
and provides bond counsel services to an issuer, as defined by
Section 1201.002(1), identification of the following for each
issuance for which the individual served as bond counsel:
(A) the amount of the issuance;
(B) the name of the issuer;
(C) the date of the issuance;
(D) the amount of fees paid to the individual,
and whether the amount is:
(i) less than $5,000;
(ii) at least $5,000 but less than $10,000;
(iii) at least $10,000 but less than
$25,000; or
(iv) $25,000 or more; and
(E) the amount of fees paid to the individual's
firm, if applicable, and whether the amount is:
(i) less than $5,000;
(ii) at least $5,000 but less than $10,000;
(iii) at least $10,000 but less than
$25,000; or
(iv) $25,000 or more.
SECTION 10. Subchapter B, Chapter 572, Government Code, is
amended by adding Section 572.0292 to read as follows:
Sec. 572.0292. RECORDKEEPING REQUIRED. (a) Each
individual who files with the commission a financial statement
required by this subchapter shall maintain a record of the
information that is necessary for filing the financial statement.
(b) An individual required to maintain a record under this
section shall preserve the record for at least three years
beginning on the filing deadline for the financial statement
containing the information in the record.
SECTION 11. The heading to Section 572.030, Government
Code, is amended to read as follows:
Sec. 572.030. PREPARATION [AND MAILING] OF FORMS; NOTICE OF
FILING REQUIREMENTS.
SECTION 12. Sections 572.030(b), (c), and (d), Government
Code, are amended to read as follows:
(b) The commission shall notify [mail to] each individual
required to file under this subchapter of [a notice that]:
(1) the requirement [states] that the individual [is
required to] file a financial statement under this subchapter;
(2) [identifies] the filing dates for the financial
statement as provided by Sections 572.026 and 572.027; and
(3) [describes] the manner in which the individual may
electronically file the financial statement and access
instructions for filing financial statements on [obtain the
financial statement forms and instructions from] the commission's
Internet website[;
[(4) states that on request of the individual, the
commission will mail to the individual a copy of the financial
statement forms and instructions; and
[(5) states, if applicable, the fee for mailing the
forms and instructions and the manner in which the individual may
pay the fee].
(c) Except as provided by commission rule, the notification
[The notice] required by Subsection (b) must be provided [mailed]:
(1) before the 30th day before the deadline for filing
the financial statement under Section 572.026(a) or (c), except as
otherwise provided by this subsection;
(2) not later than the 15th day after the applicable
deadline for filing an application for a place on the ballot or a
declaration of write-in candidacy for candidates required to file
under Section 572.027(a), (b), or (c);
(3) not later than the seventh day after the date of
appointment for individuals required to file under Section
572.026(b), or if the legislature is in session, sooner if
possible; and
(4) not later than the fifth day after the date the
certificate of nomination is filed for candidates required to file
under Section 572.027(d) [574.027(d)].
(d) Except as provided by commission rule, the [The]
commission shall mail a copy of the financial statement forms and
instructions to an individual not later than the third business day
after the date the commission receives the individual's request for
the forms and instructions.
SECTION 13. Section 572.032, Government Code, is amended by
amending Subsection (a) and adding Subsection (d) to read as
follows:
(a) Financial statements filed under this subchapter are
public records. The commission shall maintain the statements in
separate alphabetical files and in a manner that is accessible to
the public during regular office hours and make the statements
available to the public on the commission's Internet website not
later than the 15th day after the date the statement is required to
be filed or is actually filed, whichever is later.
(d) The commission is not required to continue to make
available on its Internet website a financial statement that may be
destroyed under Subsection (c). The commission may not make
available on its Internet website a financial statement that the
commission is required to destroy under Subsection (c).
SECTION 14. Section 572.032(a-1), Government Code, as
amended by Chapters 34 (S.B. 1576) and 983 (H.B. 776), Acts of the
85th Legislature, Regular Session, 2017, is reenacted and amended
to read as follows:
(a-1) The commission shall remove the home address, the
telephone number, and the names of the dependent children of an
individual from a financial statement filed by the individual under
this subchapter before:
(1) permitting a member of the public to view the
statement;
(2) providing a copy of the statement to a member of
the public; or
(3) making the statement available to the public on
the commission's Internet website[, if the commission makes
statements filed under this subchapter available on its website].
SECTION 15. The following laws are repealed:
(1) Section 253.037, Election Code; and
(2) Sections 302.017, 302.019, and 572.032(b),
Government Code.
SECTION 16. Section 253.006, Election Code, as added by
this Act, applies only to a political contribution or a political
expenditure made on or after the effective date of this Act.
SECTION 17. The changes in law made by this Act apply only
to a political contribution made on or after the effective date of
this Act. A political contribution made before the effective date
of this Act is governed by the law in effect on the date the
contribution was made, and the former law is continued in effect for
that purpose.
SECTION 18. The changes in law made by this Act to Chapter
572, Government Code, apply only to a financial statement due on or
after the effective date of this Act. A financial statement due
before the effective date of this Act is governed by the law in
effect on the date the financial statement was due, and the former
law is continued in effect for that purpose.
SECTION 19. This Act takes effect immediately if it
receives a vote of two-thirds of all the members elected to each
house, as provided by Section 39, Article III, Texas Constitution.
If this Act does not receive the vote necessary for immediate
effect, this Act takes effect September 1, 2019.