By: Y. Davis of Dallas H.B. No. 4921
A BILL TO BE ENTITLED
AN ACT
relating to restrictions on the use of state funds to benefit
private entities that outsource jobs to foreign countries.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle F, Title 10, Government Code, is
amended by adding Chapter 2278 to read as follows:
CHAPTER 2278. RESTRICTING STATE INVESTMENT IN AND PROVISION OF TAX
BENEFITS TO ENTITIES THAT OUTSOURCE JOBS TO FOREIGN COUNTRIES
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 2278.001. DEFINITION. In this chapter, "domestic"
means created or organized in the United States or under the laws of
the United States or any state.
[Sections 2278.002-2278.050 reserved for expansion]
SUBCHAPTER B. RESTRICTIONS ON INVESTMENTS
Sec. 2278.051. APPLICABILITY OF SUBCHAPTER. (a) This
subchapter applies in connection with the management or investment
of state funds managed or invested:
(1) under the Texas Constitution or other law,
including Chapters 404 and 2256; and
(2) by or for:
(A) a public retirement system as defined by
Section 802.001 that provides service retirement, disability
retirement, or death benefits for officers or employees of the
state;
(B) an institution of higher education as defined
by Section 61.003, Education Code; or
(C) another entity that is part of state
government and that manages or invests state funds or for which
state funds are managed or invested.
(b) This subchapter applies in connection with the management or
investment of state funds without regard to whether the funds are
held in the state treasury.
(c) This subchapter does not apply to the extent that an
investment standard prescribed by the Texas Constitution prohibits
the legislature from restricting the investment discretion of an
entity responsible for the management or investment of a fund.
Sec. 2278.052. PROHIBITION ON CERTAIN INVESTMENTS. A state
governmental entity may not invest state funds in or purchase
obligations of a domestic private entity that, at any time during
the previous two years, created employment suitable for performance
in the United States in a country other than the United States and,
as a result, eliminated or failed to create similar employment in
the United States.
[Sections 2264.053-2264.100 reserved for expansion]
SUBCHAPTER C. RESTRICTIONS ON ELIGIBILITY FOR TAX AND FEE BENEFITS
Sec. 2278.101. DEFINITION. In this subchapter, "state
agency" means a department, board, commission, or other agency in
the executive branch of state government. The term does not include
an institution of higher education as defined by Section 61.003,
Education Code.
Sec. 2278.102. APPLICABILITY OF SUBCHAPTER. This
subchapter does not apply to a credit, exemption, or discount for
which the Texas Constitution specifically prescribes the
eligibility requirements.
Sec. 2278.103. INELIGIBILITY OF CERTAIN ENTITIES FOR TAX
AND FEE BENEFITS. Notwithstanding other law, a domestic private
entity is not eligible for a credit, exemption, or discount in
relation to a tax or fee imposed by the state if the entity, at any
time during the previous two years, created employment suitable for
performance in the United States in a country other than the United
States and, as a result, eliminated or failed to create similar
employment in the United States.
Sec. 2278.104. DENIAL OF BENEFITS. (a) A state agency
responsible for the issuance of a credit, exemption, or discount in
relation to a tax or fee imposed by the state shall adopt rules in
accordance with Subchapter B, Chapter 2001, relating to the manner
in which:
(1) the agency will determine whether to deny the
benefit under Section 2264.103; and
(2) a person may ask the agency to reconsider the
denial.
(b) The rules adopted by a state agency shall require that as soon
as practicable after making the decision to deny a credit,
exemption, or discount to a domestic private entity that is
ineligible for the benefit under Section 2264.103 but is otherwise
eligible for the benefit, the state agency shall provide the
domestic private entity with notice of and the factual basis for the
denial and a description of the procedures available to request a
reconsideration and to contest the factual or legal basis for the
denial.
SECTION 2. Chapter 2278, Government Code, as added by this
Act, applies only to:
(1) an investment made by a state governmental entity on or
after September 1, 2026; and
(2) a credit, exemption, or discount provided or denied on
or after September 1, 2026, in relation to a tax or fee imposed by
the state.
SECTION 3. This Act takes effect September 1, 2025.