BILL ANALYSIS C.S.H.B. 210 By: Guillen Public Education Committee Report (Substituted) BACKGROUND AND PURPOSE The bill author has informed the committee of a recurring issue in Texas public school districts and open-enrollment charter schools whereby trustees, governing body members, or their relatives have financial ties to vendors that secure district or charter school contracts, which may lead to conflicts of interest and misuse of taxpayer funds wherein trustees or governing body members might be influenced to enter into contracts with businesses in which they have a financial interest. C.S.H.B. 210 seeks to remedy this issue and prohibit vendors from bidding on or receiving a contract from a district or charter school if a board or governing body member has a substantial interest in the vendor or a subcontractor, is related to an individual with a substantial interest in the vendor, or has received or been promised a gift or an in-kind service of a certain value. The bill accomplishes this by creating a criminal offense for a vendor who violates that prohibition, with penalties ranging from a Class C misdemeanor to a state jail felony for subsequent violations. CRIMINAL JUSTICE IMPACT It is the committee's opinion that this bill expressly does one or more of the following: creates a criminal offense, increases the punishment for an existing criminal offense or category of offenses, or changes the eligibility of a person for community supervision, parole, or mandatory supervision. RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS C.S.H.B. 210 amends the Education Code to create a Class C misdemeanor offense for a vendor that bids on or receives a contract from a public school district or an open-enrollment charter school if any individual serving on the board of trustees or governing body of the district or charter school meets any of the following criteria: has a substantial interest in the vendor or a subcontractor hired by a vendor; is related in the second degree by consanguinity or affinity, as determined under applicable Government Code provisions, to an individual who has a substantial interest in the vendor; or has received or has been promised a gift or in-kind services with a value of more than $250. The bill establishes that an individual has a substantial interest in a vendor if the individual owns more than 10 percent of the voting interest in the vendor or has a direct or indirect participating interest by shares, stock, or otherwise, regardless of whether voting rights are included, in more than 10 percent of the profits, proceeds, or capital gains of the vendor. C.S.H.B. 210 enhances the penalty for a subsequent conviction of the bill's offense as follows: to a Class B misdemeanor for a second offense; to a Class A misdemeanor for a third offense; and to a state jail felony for a fourth or subsequent offense. The bill also enhances the penalty for the bill's offense from a Class C misdemeanor to a state jail felony if the vendor directly or indirectly through a third party compensated the individual serving on the board of trustees or governing body of a district or charter school with money, gifts, or in-kind services as consideration for the district or charter school entering into a contract with the vendor. C.S.H.B. 210 defines "vendor" as a company, individual, contractor, subcontractor, or professional services provider with whom a district or charter school enters into an agreement, contract, memorandum of understanding, interlocal agreement, fee schedule, retainer, or similar instrument for goods or services. EFFECTIVE DATE September 1, 2025. COMPARISON OF INTRODUCED AND SUBSTITUTE While C.S.H.B. 210 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill. The substitute includes a definition for "vendor," which did not appear in the introduced. While both the introduced and substitute create an offense for a vendor that bids on or receives a contract from a public school district if any individual serving on the district's board of trustees meets certain criteria, the substitute also makes the bill's offense applicable with respect to a contract from an open-enrollment charter school and an individual serving on the governing body of the charter school, whereas the introduced did not do so. Additionally, the substitute includes the following as criteria that an individual serving on the district's board of trustees or the charter school's governing body meets that trigger the offense, which were not included in the introduced: the individual has a substantial interest in a subcontractor hired by the vendor; or the individual has received or has been promised a gift or in-kind services with a value of more than $250. Additionally, while both the introduced and substitute enhance the penalty for the bill's offense from a Class C misdemeanor to a state jail felony for a vendor who directly compensated the individual serving on the district's board of trustees as consideration for the district entering into a contract with the vendor, the substitute broadens that enhancement by doing the following: making it applicable also to a vendor who indirectly compensated the individual through a third party, which the introduced did not do; including an individual serving on the governing body of a charter school among the individuals compensated as consideration for entering into the contract, which was not included in the introduced; and specifying that the method of compensation is with money, gifts, or in-kind services, which was not specified in the introduced.
BILL ANALYSIS
# BILL ANALYSIS
C.S.H.B. 210
By: Guillen
Public Education
Committee Report (Substituted)
C.S.H.B. 210
By: Guillen
Public Education
Committee Report (Substituted)
BACKGROUND AND PURPOSE The bill author has informed the committee of a recurring issue in Texas public school districts and open-enrollment charter schools whereby trustees, governing body members, or their relatives have financial ties to vendors that secure district or charter school contracts, which may lead to conflicts of interest and misuse of taxpayer funds wherein trustees or governing body members might be influenced to enter into contracts with businesses in which they have a financial interest. C.S.H.B. 210 seeks to remedy this issue and prohibit vendors from bidding on or receiving a contract from a district or charter school if a board or governing body member has a substantial interest in the vendor or a subcontractor, is related to an individual with a substantial interest in the vendor, or has received or been promised a gift or an in-kind service of a certain value. The bill accomplishes this by creating a criminal offense for a vendor who violates that prohibition, with penalties ranging from a Class C misdemeanor to a state jail felony for subsequent violations.
CRIMINAL JUSTICE IMPACT It is the committee's opinion that this bill expressly does one or more of the following: creates a criminal offense, increases the punishment for an existing criminal offense or category of offenses, or changes the eligibility of a person for community supervision, parole, or mandatory supervision.
RULEMAKING AUTHORITY It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
ANALYSIS C.S.H.B. 210 amends the Education Code to create a Class C misdemeanor offense for a vendor that bids on or receives a contract from a public school district or an open-enrollment charter school if any individual serving on the board of trustees or governing body of the district or charter school meets any of the following criteria: has a substantial interest in the vendor or a subcontractor hired by a vendor; is related in the second degree by consanguinity or affinity, as determined under applicable Government Code provisions, to an individual who has a substantial interest in the vendor; or has received or has been promised a gift or in-kind services with a value of more than $250. The bill establishes that an individual has a substantial interest in a vendor if the individual owns more than 10 percent of the voting interest in the vendor or has a direct or indirect participating interest by shares, stock, or otherwise, regardless of whether voting rights are included, in more than 10 percent of the profits, proceeds, or capital gains of the vendor. C.S.H.B. 210 enhances the penalty for a subsequent conviction of the bill's offense as follows: to a Class B misdemeanor for a second offense; to a Class A misdemeanor for a third offense; and to a state jail felony for a fourth or subsequent offense. The bill also enhances the penalty for the bill's offense from a Class C misdemeanor to a state jail felony if the vendor directly or indirectly through a third party compensated the individual serving on the board of trustees or governing body of a district or charter school with money, gifts, or in-kind services as consideration for the district or charter school entering into a contract with the vendor. C.S.H.B. 210 defines "vendor" as a company, individual, contractor, subcontractor, or professional services provider with whom a district or charter school enters into an agreement, contract, memorandum of understanding, interlocal agreement, fee schedule, retainer, or similar instrument for goods or services.
EFFECTIVE DATE September 1, 2025.
COMPARISON OF INTRODUCED AND SUBSTITUTE While C.S.H.B. 210 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill. The substitute includes a definition for "vendor," which did not appear in the introduced. While both the introduced and substitute create an offense for a vendor that bids on or receives a contract from a public school district if any individual serving on the district's board of trustees meets certain criteria, the substitute also makes the bill's offense applicable with respect to a contract from an open-enrollment charter school and an individual serving on the governing body of the charter school, whereas the introduced did not do so. Additionally, the substitute includes the following as criteria that an individual serving on the district's board of trustees or the charter school's governing body meets that trigger the offense, which were not included in the introduced: the individual has a substantial interest in a subcontractor hired by the vendor; or the individual has received or has been promised a gift or in-kind services with a value of more than $250. Additionally, while both the introduced and substitute enhance the penalty for the bill's offense from a Class C misdemeanor to a state jail felony for a vendor who directly compensated the individual serving on the district's board of trustees as consideration for the district entering into a contract with the vendor, the substitute broadens that enhancement by doing the following: making it applicable also to a vendor who indirectly compensated the individual through a third party, which the introduced did not do; including an individual serving on the governing body of a charter school among the individuals compensated as consideration for entering into the contract, which was not included in the introduced; and specifying that the method of compensation is with money, gifts, or in-kind services, which was not specified in the introduced.
BACKGROUND AND PURPOSE
The bill author has informed the committee of a recurring issue in Texas public school districts and open-enrollment charter schools whereby trustees, governing body members, or their relatives have financial ties to vendors that secure district or charter school contracts, which may lead to conflicts of interest and misuse of taxpayer funds wherein trustees or governing body members might be influenced to enter into contracts with businesses in which they have a financial interest. C.S.H.B. 210 seeks to remedy this issue and prohibit vendors from bidding on or receiving a contract from a district or charter school if a board or governing body member has a substantial interest in the vendor or a subcontractor, is related to an individual with a substantial interest in the vendor, or has received or been promised a gift or an in-kind service of a certain value. The bill accomplishes this by creating a criminal offense for a vendor who violates that prohibition, with penalties ranging from a Class C misdemeanor to a state jail felony for subsequent violations.
CRIMINAL JUSTICE IMPACT
It is the committee's opinion that this bill expressly does one or more of the following: creates a criminal offense, increases the punishment for an existing criminal offense or category of offenses, or changes the eligibility of a person for community supervision, parole, or mandatory supervision.
RULEMAKING AUTHORITY
It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.
ANALYSIS
C.S.H.B. 210 amends the Education Code to create a Class C misdemeanor offense for a vendor that bids on or receives a contract from a public school district or an open-enrollment charter school if any individual serving on the board of trustees or governing body of the district or charter school meets any of the following criteria:
has a substantial interest in the vendor or a subcontractor hired by a vendor;
is related in the second degree by consanguinity or affinity, as determined under applicable Government Code provisions, to an individual who has a substantial interest in the vendor; or
has received or has been promised a gift or in-kind services with a value of more than $250.
The bill establishes that an individual has a substantial interest in a vendor if the individual owns more than 10 percent of the voting interest in the vendor or has a direct or indirect participating interest by shares, stock, or otherwise, regardless of whether voting rights are included, in more than 10 percent of the profits, proceeds, or capital gains of the vendor.
C.S.H.B. 210 enhances the penalty for a subsequent conviction of the bill's offense as follows:
to a Class B misdemeanor for a second offense;
to a Class A misdemeanor for a third offense; and
to a state jail felony for a fourth or subsequent offense.
The bill also enhances the penalty for the bill's offense from a Class C misdemeanor to a state jail felony if the vendor directly or indirectly through a third party compensated the individual serving on the board of trustees or governing body of a district or charter school with money, gifts, or in-kind services as consideration for the district or charter school entering into a contract with the vendor.
C.S.H.B. 210 defines "vendor" as a company, individual, contractor, subcontractor, or professional services provider with whom a district or charter school enters into an agreement, contract, memorandum of understanding, interlocal agreement, fee schedule, retainer, or similar instrument for goods or services.
EFFECTIVE DATE
September 1, 2025.
COMPARISON OF INTRODUCED AND SUBSTITUTE
While C.S.H.B. 210 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill.
The substitute includes a definition for "vendor," which did not appear in the introduced.
While both the introduced and substitute create an offense for a vendor that bids on or receives a contract from a public school district if any individual serving on the district's board of trustees meets certain criteria, the substitute also makes the bill's offense applicable with respect to a contract from an open-enrollment charter school and an individual serving on the governing body of the charter school, whereas the introduced did not do so. Additionally, the substitute includes the following as criteria that an individual serving on the district's board of trustees or the charter school's governing body meets that trigger the offense, which were not included in the introduced:
the individual has a substantial interest in a subcontractor hired by the vendor; or
the individual has received or has been promised a gift or in-kind services with a value of more than $250.
Additionally, while both the introduced and substitute enhance the penalty for the bill's offense from a Class C misdemeanor to a state jail felony for a vendor who directly compensated the individual serving on the district's board of trustees as consideration for the district entering into a contract with the vendor, the substitute broadens that enhancement by doing the following:
making it applicable also to a vendor who indirectly compensated the individual through a third party, which the introduced did not do;
including an individual serving on the governing body of a charter school among the individuals compensated as consideration for entering into the contract, which was not included in the introduced; and
specifying that the method of compensation is with money, gifts, or in-kind services, which was not specified in the introduced.