By: West S.B. No. 1739
A BILL TO BE ENTITLED
AN ACT
relating to use and operation of the childcare protection and
enhancement fund.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 4, Labor Code, Chapter 302, is amended by
adding Section 302.0052 to read as follows:
Sec. 302.0052 CHILD CARE PROTECTION AND ENHANCEMENT FUND.
DEFINITIONS. In this chapter:
(1) "Fund" means the child care protection and
enhancement fund established under Section 49-r, Article III, Texas
Constitution.
(2) "Trust company" means the Texas Treasury
Safekeeping Trust Company.
(3) "Agency" means the Texas Workforce Commission.
Sec. 302.0053. ADMINISTRATION AND MANAGEMENT OF FUND. (a)
The child care protection and enhancement fund is a trust fund held
outside the treasury by the trust company and administered by the
department for the purpose of the expansion of childcare capacity
and enhancement of subsidized childcare rates.
(b) The trust company shall hold and invest the fund, taking
into account the purposes for which the money in the fund may be
used. The overall objective for the investment of the fund is to
maintain sufficient liquidity to meet the needs of the fund.
(c) The expenses of managing the fund and its assets shall
be paid from the fund. Except as otherwise provided by this chapter
and Section 49-r, Article III, Texas Constitution, money in the
fund may not be used for any other purpose.
(d) In managing the assets of the fund, through procedures
and subject to restrictions the trust company considers
appropriate, the trust company may acquire, exchange, sell,
supervise, manage, or retain any kind of investment that a prudent
investor, exercising reasonable care, skill, and caution, would
acquire or retain in light of the purposes, terms, distribution
requirements, liquidity requirements, and other circumstances of
the fund then prevailing, taking into consideration the investment
of all the fund assets rather than a single investment. The fund
may be invested with the state treasury pool and may be pooled with
other state assets for purposes of investment.
(e) The department shall provide the trust company with a
cash flow forecast at least annually, and more frequently as
appropriate, to ensure the trust company is able to satisfy the
objectives specified by Subsection (b).
Sec. 302.0054. DISTRIBUTION. The agency shall annually
request from the trust company a distribution from the fund in the
amount equal to the interest earned on the fund for the purpose of
increasing both capacity and rates for subsidized childcare in this
state.
Sec. 302.0055. STIPULATIONS ON USE OF FUND. (a) The Texas
Workforce Commission must submit to the Texas Workforce
Commissioners and the Texas Comptroller of Public Accounts a
request for approval of a proposed disbursement and how that
disbursement will be used to increase subsidized childcare rates
and capacity in this state.
(b) A request under this section shall be considered
approved on the 30th day after the date the request is submitted
unless the request is approved or disapproved before that date.
Sec. 302.0056. PROHIBITED EXPENDITURES. Money in the fund
may not be used:
(1) to pay salaries, employee benefits, costs
associated with employee benefits, or administration, operating,
or program costs of the department; or
(2) for the maintenance or operation of a state
agency.
Sec. 302.0057. EXPENDITURES SUBJECT TO AUDIT. All
expenditures by the agency under this chapter are subject to audit
by the state auditor.
Sec. 302.0058. STRATEGIC PLAN. The department shall
include in each strategic plan submitted under Section 2056.002,
Government Code, a report on each acquisition funded using money in
the fund during the two-year period preceding the date on which the
department submits the plan.
SECTION 2. This Act takes effect January 1, 2026, but only
if the constitutional amendment proposed by the 89th Legislature,
Regular Session, 2025, providing for the creation of the child care
preservation and enhancement fund to be used for the increase in
capacity and increase in subsidized childcare rates is approved by
the voters. If that amendment is not approved by the voters, this
Act has no effect.