| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to prohibiting public schools from owning or having a |
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| 8 | 8 | | business interest in certain entities and real property associated |
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| 9 | 9 | | with those entities. |
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| 10 | 10 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 11 | 11 | | SECTION 1. Subchapter E, Chapter 45, Education Code, is |
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| 12 | 12 | | amended by adding Section 45.116 to read as follows: |
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| 13 | 13 | | Sec. 45.116. OWNERSHIP OF OR BUSINESS INTEREST IN CERTAIN |
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| 14 | 14 | | ENTITIES AND PROPERTY PROHIBITED. (a) In this section: |
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| 15 | 15 | | (1) "Affiliate" has the meaning assigned by Section |
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| 16 | 16 | | 1.002, Business Organizations Code. |
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| 17 | 17 | | (2) "Business interest" means owning or controlling, |
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| 18 | 18 | | directly or indirectly, more than a 10 percent interest in a |
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| 19 | 19 | | business entity. |
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| 20 | 20 | | (b) A school district or open-enrollment charter school may |
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| 21 | 21 | | not, directly or indirectly through an affiliate, including an |
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| 22 | 22 | | affiliated nonprofit corporation, have a business interest in an |
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| 23 | 23 | | entity or own real property associated with an entity described by |
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| 24 | 24 | | the North American Industry Classification System (NAICS) in any of |
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| 25 | 25 | | the following sector codes: |
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| 26 | 26 | | (1) Sector 53: Real Estate and Rental and Leasing; |
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| 27 | 27 | | (2) Sector 71: Arts, Entertainment, and Recreation; or |
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| 28 | 28 | | (3) Sector 72: Accommodation and Food Services. |
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| 29 | 29 | | SECTION 2. The change in law made by this Act applies to an |
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| 30 | 30 | | ownership or business interest in an entity or real property |
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| 31 | 31 | | acquired by a school district or open-enrollment charter school |
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| 32 | 32 | | before, on, or after the effective date of this Act. A school |
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| 33 | 33 | | district or open-enrollment charter school subject to Section |
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| 34 | 34 | | 45.116, Education Code, as added by this Act, shall divest all |
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| 35 | 35 | | ownership of, or business interest in, an entity or real property |
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| 36 | 36 | | associated with an entity described by that section not later than |
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| 37 | 37 | | September 1, 2024. |
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| 38 | 38 | | SECTION 3. This Act takes effect September 1, 2019. |
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