Texas 2025 - 89th Regular

Texas House Bill HB12 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	~~By: Bell of Kaufman, Capriglione, Hunter, H.B. No. 12~~
2		-	~~Spiller, Canales,~~ ~~et al~~.
3		-
4		-
	1	+	89R18101 MCK-D
	2	+	By: Bell of Kaufman H.B. No. 12
	3	+	Substitute the following for H.B. No. 12:
	4	+	By: Capriglione C.S.H.B. No. 12
5	5
6	6
7	7		A BILL TO BE ENTITLED
8	8		AN ACT
9	9		relating to the review and audit of certain state agency
10	10		operations.
11	11		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12		SECTION 1. Section 325.002, Government Code, is amended by
13	13		adding Subdivision (4) to read as follows:
14	14		(4) "Regulatory agency" means a department,
15	15		commission, board, or other agency that:
16	16		(A) is created by the constitution or by statute;
17	17		(B) is in the executive branch of state
18	18		government;
19	19		(C) has statewide authority; and
20	20		(D) has authority to deny, grant, renew, revoke,
21	21		or suspend a license, certification, or other authorization to
22	22		engage in an activity.
23	23		SECTION 2. Section 325.009, Government Code, is amended by
24	24		adding Subsections (b-1), (b-2), and (b-3) to read as follows:
25	25		(b-1) The commission shall provide information on how the
26	26		public may participate in the commission's review of a state agency
27	27		and provide input on a state agency's performance. The commission
28	28		shall, to the extent practicable, solicit input from parties
29	29		interested in a state agency's operations.
30	30		(b-2) Each state agency being reviewed by the commission
31	31		under this chapter shall at the beginning of the review:
32	32		(1) post a notice on the state agency's Internet
33	33		website informing the public:
34	34		(A) that the state agency is being reviewed by
35	35		the commission; and
36	36		(B) how the public may participate in the
37	37		commission's review of the state agency and provide input on the
38	38		state agency's performance; and
39	39		(2) if the state agency being reviewed is a regulatory
40	40		agency:
41	41		(A) notify each person licensed, certified, or
42	42		otherwise authorized by the regulatory agency to engage in an
43	43		activity regulated by the agency of the public hearing under this
44	44		section at which the agency will be reviewed; and
45	45		(B) solicit input from persons provided notice
46	46		under Paragraph (A) regarding the regulatory agency's performance.
47	47		(b-3) Subsection (b-2) does not apply to a river authority
48	48		subject to review under this chapter.
49	49		SECTION 3. Section 325.010(b), Government Code, is amended
50	50		to read as follows:
51	51		(b) In the report the commission shall include:
52	52		(1) its findings regarding the criteria prescribed by
53	53		Section 325.011, except Section 325.011(14);
54	54		(2) its recommendations based on the matters
55	55		prescribed by Section 325.012, except recommendations relating to
56	56		criteria prescribed by Section 325.011(14); [and]
57	57		(3) if the agency being reviewed is a regulatory
58	58		agency, an analysis of the regulatory agency's performance during
59	59		the preceding 10 years or since the last review of the agency under
60	60		this chapter, whichever is longer, based on the agency's
61	61		performance measure targets as listed in the General Appropriations
62	62		Act;
63	63		(4) an evaluation of the agency's performance measure
64	64		targets listed in the General Appropriations Act, including whether
65	65		the targets are:
66	66		(A) aligned with the mission, goals, and
67	67		objectives of the agency; and
68	68		(B) appropriate for assessing the agency's
69	69		achievement of the goals listed; and
70	70		(5) other information the commission considers
71		-	necessary for a complete review of the agency to reduce fraud,
72		-	waste, and abuse and to increase efficiencies.
	71	+	necessary for a complete review of the agency.
73	72		SECTION 4. Section 325.012(a), Government Code, is amended
74	73		to read as follows:
75	74		(a) In its report on a state agency, the commission shall:
76	75		(1) make recommendations on the abolition,
77	76		continuation, or reorganization of each affected state agency and
78	77		its advisory committees and on the need for the performance of the
79	78		functions of the agency and its advisory committees;
80	79		(2) make recommendations on the consolidation,
81	80		transfer, or reorganization of programs within state agencies not
82	81		under review when the programs duplicate functions performed in
83	82		agencies under review;
84	83		(3) make recommendations to improve the operations of
85	84		the agency, its policy body, and its advisory committees, including
86	85		management recommendations that do not require a change in the
87	86		agency's enabling statute; [and]
88	87		(4) make recommendations on the continuation or
89	88		abolition of each reporting requirement imposed on the agency by
90	89		law; and
91	90		(5) make recommendations to improve the agency's key
92	91		performance measures through the addition, amendment, or removal of
93	92		the performance measure targets listed in the General
94	93		Appropriations Act.
95	94		SECTION 5. Chapter 325, Government Code, is amended by
96	95		adding Section 325.016 to read as follows:
97	96		Sec. 325.016. LIMITED REVIEW OF CERTAIN REGULATORY
98	97		AGENCIES. (a) During the two-year period beginning on September 1
99	98		of the sixth year after the date a regulatory agency was last
100	99		continued under Section 325.015, the commission shall conduct a
101	100		limited review of the agency's rulemaking, including:
102	101		(1) an assessment of the agency's rulemaking process
103	102		and the extent to which the agency has encouraged participation by
104	103		the public in making its rules and decisions and the extent to which
105	104		the public participation has resulted in rules that benefit the
106	105		public;
107	106		(2) the extent to which the agency adopts and enforces
108	107		rules relating to potential conflicts of interest of its employees;
109	108		and
110	109		(3) the necessity and effectiveness of rules adopted
111	110		by the agency.
112	111		(b) Not later than September 1 of the sixth year after the
113	112		date a regulatory agency was last continued under Section 325.015,
114	113		the agency shall report to the commission the information in
115	114		Subsection (a) related to rulemaking and rule review activities of
116	115		the agency.
117	116		(c) Not later than September 1 of the year that is two years
118	117		after the date the review under this section begins, the commission
119	118		shall prepare a written report on the commission's review under
120	119		this section.
121	120		(d) The report prepared by the commission under this section
122	121		is a public record.
123	122		SECTION 6. Subtitle C, Title 3, Government Code, is amended
124	123		by adding Chapter 327 to read as follows:
125	124		CHAPTER 327. EFFICIENCY AUDITS OF STATE AGENCIES
126	125		Sec. 327.001. DEFINITIONS. In this chapter:
127	126		(1) "Audit plan" has the meaning assigned by Section
128	127		321.001.
129	128		(2) "Commission" means the Sunset Advisory
130	129		Commission.
131	130		(3) "Efficiency audit" means an evaluation of the
132	131		economy, efficiency, and effectiveness of state agency operations,
133	132		including:
134	133		(A) determining whether the state agency is
135	134		managing or using its resources, including state money, personnel,
136	135		property, equipment, and space, in an economical and efficient
137	136		manner;
138	137		(B) identifying causes of inefficiencies or
139	138		uneconomical practices, including inadequacies in management
140	139		information systems, internal and administrative procedures,
141	140		organizational structure, use of resources, allocation of
142	141		personnel, purchasing, agency policies, and equipment;
143	142		(C) determining whether financial, program, and
144	143		statistical reports of the state agency contain useful data and are
145	144		fairly presented;
146	145		(D) determining whether, according to
147	146		established or designated program objectives, responsibilities or
148	147		duties, statutes and rules, program performance criteria, or
149	148		program evaluation standards, the objectives and intended benefits
150	149		of the agency's program are being achieved efficiently and
151	150		effectively; and
152	151		(E) determining whether, according to
153	152		established or designated program objectives, responsibilities or
154	153		duties, statutes and rules, program performance criteria, or
155	154		program evaluation standards, the agency's program duplicates,
156	155		overlaps, or conflicts with another state program.
157	156		(4) "External auditor" means a private entity selected
158	157		by the state auditor to conduct an efficiency audit of a state
159	158		agency.
160	159		(5) "Legislative audit committee" means the committee
161	160		described by Section 321.002.
162	161		(6) "State agency" means an entity expressly made
163	162		subject to Chapter 325 (Texas Sunset Act) other than a river
164	163		authority.
165	164		Sec. 327.002. REQUIRED EFFICIENCY AUDIT. (a) Each state
166	165		agency shall undergo an efficiency audit in accordance with this
167	166		chapter.
168	167		(b) The state auditor, subject to the legislative audit
169	168		committee's approval, shall adopt a schedule for conducting the
170	169		efficiency audits required by this chapter and include the annual
171	170		portion of the schedule in the audit plan under Section 321.013.
172	171		The schedule must provide for each state agency to be audited during
173	172		the two-year period beginning on September 1 four years before the
174	173		date the state agency is scheduled to be abolished under Chapter 325
175	174		(Texas Sunset Act).
176	175		(c) A state agency required by law to perform an internal
177	176		efficiency audit is not required to perform the audit in any year
178	177		the state agency is audited under this chapter.
179	178		(d) A state agency shall pay the costs incurred by the state
180	179		auditor relating to an efficiency audit required by this chapter.
181	180		The state auditor shall determine the costs of the audit and the
182	181		state agency shall pay the amount of those costs promptly on receipt
183	182		of a statement from the state auditor regarding those costs.
184	183		(e) The state auditor, subject to the legislative audit
185	184		committee's approval, may determine, in the interests of
186	185		efficiency, whether the audit should be performed by the state
187	186		auditor or an external auditor.
188	187		Sec. 327.003. SELECTION AND SUPERVISION OF AUDITOR. (a)
189	188		Not later than March 1 of the year in which an efficiency audit of a
190	189		state agency is scheduled under this chapter, the state auditor may
191	190		contract with an external auditor to conduct the audit.
192	191		(b) The state auditor, in cooperation with the Legislative
193	192		Budget Board, shall oversee the external auditor and ensure that
194	193		the efficiency audit is conducted in accordance with the
195	194		requirements of this chapter and the scope of the audit established
196	195		under this chapter.
197	196		(c) The external auditor is not subject to direction from
198	197		the state agency being audited.
199	198		Sec. 327.004. SCOPE OF AUDIT. (a) The state auditor, in
200	199		cooperation with the Legislative Budget Board, shall establish the
201	200		scope of each efficiency audit conducted under this chapter.
202	201		(b) At a minimum, an efficiency audit must:
203	202		(1) examine state resources, including financial
204	203		resources, staff, personal property, real property, and
205	204		technology, to determine whether those resources:
206	205		(A) are used effectively and efficiently to
207	206		achieve the desired outcome for a state agency's program
208	207		beneficiaries; and
209	208		(B) are not used for purposes other than the
210	209		intended goals of the audited programs;
211	210		(2) identify and make recommendations for cost savings
212	211		and reallocation of resources to improve the effectiveness of
213	212		audited programs; and
214	213		(3) identify opportunities for improving services
215	214		through consolidation of functions, outsourcing, and elimination
216	215		of duplicative efforts.
217	216		Sec. 327.005. REPORT TO LEGISLATURE. (a) Not later than
218	217		November 1 of the year an efficiency audit is conducted under this
219	218		chapter, the state auditor, in cooperation with the Legislative
220	219		Budget Board and in consultation with any external auditor
221	220		contracted to perform the audit, shall:
222	221		(1) prepare a report of the audit with the
223	222		recommendations; and
224	223		(2) submit the report, recommendations, and complete
225	224		audit to the commission, the governor, the lieutenant governor, the
226	225		speaker of the house of representatives, the legislative audit
227	226		committee, the chairs of the standing committees of each house of
228	227		the legislature with primary jurisdiction over the audited state
229	228		agency, and the audited state agency.
230	229		(b) The state auditor and the audited state agency shall
231	230		publish the report, recommendations, and complete efficiency audit
232	231		on the entity's Internet website.
233	232		Sec. 327.006. REQUIRED IMPLEMENTATION PLAN. Not later than
234	233		the 90th day after the date of receiving the complete audit and
235	234		recommendations, the administrative head of the audited state
236	235		agency shall deliver a plan for implementing the recommendations to
237	236		the commission, the governor, the lieutenant governor, the speaker
238	237		of the house of representatives, the legislative audit committee,
239	238		and the chairs of the standing committees of each house of the
240	239		legislature with primary jurisdiction over the audited state
241	240		agency. The implementation plan must include a reasoned
242	241		justification for any recommendation the audited state agency
243	242		declines to implement.
244	243		SECTION 7. Section 322.017, Government Code, is repealed.
245	244		SECTION 8. Not later than January 1, 2026, the state auditor
246	245		shall adopt the schedule required by Section 327.002, Government
247	246		Code, as added by this Act, for conducting efficiency audits of each
248	247		state agency subject to that section.
249	248		SECTION 9. This Act takes effect September 1, 2025.