BILL ANALYSIS Senate Research Center S.B. 2034 89R9872 AMF-F By: Paxton Health & Human Services 3/21/2025 As Filed AUTHOR'S / SPONSOR'S STATEMENT OF INTENT Current statute does not grant the Department of Family and Protective Services (DFPS) the ability to act swiftly if a single source continuum contractor (SSCC) does not meet its contractual duties or poses a threat to child safety and well-being. The progressive intervention plan outlined in the current SSCC contractwhich is comprised of the ability for DFPS to impose continuous quality improvement plans, corrective action plans, or to seek contract terminationdoes not provide an expedient manner by which DFPS can ensure continuity of services and the safety of the children that are under an SSCC's care when there are severe concerns with an SSCC's performance or actions. This bill allows DFPS to petition a court of competent jurisdiction for receivership of an SSCC or any of its parts, divisions, components, or companies that deliver community-based care (CBC). This proposed solution enables the receiver to continue to carry out the contractual duties and ensures the safety and well-being of the population served when expedient action is necessary. As proposed, S.B. 2034 amends current law relating to the receivership of a single-source continuum contractor providing child welfare services. RULEMAKING AUTHORITY This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 64.001(a), Civil Practice and Remedies Code, as follows: (a) Authorizes a court of competent jurisdiction to appoint a receiver in certain cases, including for a single-source continuum contractor as provided by Subchapter B-2, Chapter 264 (Child Welfare Services), Family Code. Makes a nonsubstantive change. SECTION 2. Amends Chapter 264. Family Code, by adding Subchapter B-2, as follows: SUBCHAPTER B-2. RECEIVER FOR SINGLE-SOURCE CONTINUUM CONTRACTOR Sec. 264.191. DEFINITIONS. Defines "catchment area," "community-based care contract," and "single-source continuum contractor." Sec. 264.1915. RECEIVER OF SINGLE-SOURCE CONTINUUM CONTRACTOR. Authorizes a court of competent jurisdiction to appoint a receiver for a single-source continuum contractor or any of its parts, divisions, components, or companies on the petition of the Department of Family and Protective Services (DFPS) if: (1) after being subject to a quality improvement plan, corrective action plan, or other remedial statutory or contract measures, the contractor continues to fail to satisfactorily perform under the community-based care contract; (2) the contractor provides DFPS notice of the contractor's intent to cease operations not later than the 60th day before the date the contractor intends to cease operations and has not made arrangements for another single-source continuum contractor or DFPS to continue the uninterrupted provision of services under the community-based care contract; (3) conditions exist, as determined by DFPS, within the contractor that present an imminent danger to the health, safety, or welfare of the children under the conservatorship of DFPS in the contractor's care; (4) the contractor has failed to provide adequate information to DFPS regarding a child under the conservatorship of DFPS in the contractor's care; (5) the contractor has failed to comply with a court order or incurred a sanction against DFPS due to failure to comply with a court order; or (6) the contractor cannot meet or is unlikely to be able to meet financial obligations related to services provided under the community-based care contract, including financial obligations to employees, contractors, or foster parents. Sec. 264.192. PROCEEDING TO APPOINT RECEIVER. (a) Requires a court, except as otherwise provided by law, to give precedence to a petition for the appointment of a receiver under this subchapter over other matters. (b) Requires a court to conduct an evidentiary hearing on a petition for the appointment of a receiver under this subchapter not later than the fifth day after the date the petition is filed. Requires DFPS to make reasonable efforts to notify the single-source continuum contractor of the hearing under this subsection. (c) Requires a court to grant a petition for the appointment of a receiver under this subchapter on finding that one of the conditions described by Section 264.1915 exists and the continued existence of the condition jeopardizes the health, safety, or welfare of a child under the conservatorship of DFPS. (d) Authorizes a court to grant a petition for the appointment of a receiver under this subchapter ex parte. (e) Provides that the issuance of a check without sufficient money by the single-source continuum contractor or the existence of delinquent obligations for salaries, utilities, or essential services or commodities for the contractor is prima facie evidence that the contractor cannot meet or is unlikely to be able to meet financial obligations related to services provided under the community-based care contract as provided by Section 264.1915(6). Sec. 264.1925. QUALIFICATIONS. (a) Requires a person, to be appointed as a receiver under this subchapter, to be qualified by education, training, or experience to carry out the duties of the receiver under this subchapter. Authorizes a receiver appointed under this subchapter, notwithstanding Section 64.021 (Qualifications; Residence Requirement), Civil Practice and Remedies Code, to be an employee of DFPS. (b) Requires a court to appoint a receiver selected from a list of qualified persons developed by DFPS and filed with the court. Sec. 264.193. LIMITED DURATION; ASSESSMENT. (a) Provides that a receivership under this subchapter expires on the 90th day after the date a receiver is appointed, unless DFPS files a petition for a 60-day extension of the receivership with the appointing court on or before the date the receivership expires. Authorizes DFPS to request multiple extensions under this subsection. (b) Requires DFPS, on or before the 60th day after the date a receiver is appointed under this subchapter and every 60 days thereafter until the expiration or termination of the receivership, to file with the appointing court an assessment of ability of the single-source continuum contractor under receivership to ensure the health, safety, and welfare of the children under the conservatorship of DFPS in the contractor's care. Sec. 264.1935. BOND. Provides that, notwithstanding Section 64.023 (Bond), Civil Practice and Remedies Code, a receiver appointed under this subchapter who is an employee of DFPS is not required to execute a bond. Sec. 264.194. POWERS AND DUTIES OF RECEIVER. (a) Requires a receiver appointed under this subchapter to take all actions: (1) ordered by the appointing court; and (2) necessary to ensure the continued health, safety, and welfare of children under the conservatorship of DFPS in the care of the single-source continuum contractor under receivership, which are authorized to include certain actions; (b) Provides that, notwithstanding any other law and to ensure continuous provision of necessary services to children under the conservatorship of DFPS and their families, a contract entered into by a receiver acting in accordance with the receiver's duties under this section is not subject to advertising, competitive bidding, or proposal evaluation requirements. (c) Requires a receiver to compensate an employee hired in accordance with this section at a rate of compensation, including benefits, approved by the appointing court. (d) Authorizes a receiver to petition the appointing court for temporary relief from obligations under a contract entered into by the single-source continuum contractor under receivership if the rent, price, or rate of interest substantially exceeds a reasonable rent, price, or rate of interest at the time the contractor entered into the contract or any material provision of the contract is unreasonable when compared to contracts negotiated under similar conditions. (e) Provides that any relief granted by a court under Subsection (d) is limited to the life of the receivership, unless otherwise determined by the court. (f) Requires a receiver appointed under this subchapter to deposit all money related to the receivership in a separate account and to use that account for all disbursements related to the receivership. Requires that a payment to a receiver of a sum owed to the single-source continuum contractor under receivership be considered a payment to the contractor with respect to the discharge of the obligation. (g) Requires a receiver who is not a DFPS employee to coordinate with DFPS to ensure the continued health, safety, and welfare of the children in DFPS's conservatorship and compliance with all state and federal laws relating to child welfare. (h) Requires a receiver to make a reasonable effort to facilitate the continued operation of the community-based care program under Subchapter B-1 (Community-Based Care) in the applicable catchment area. Sec. 264.1945. COMPENSATION OF RECEIVER. Requires the appointing court to order compensation for a receiver appointed under this subchapter to be paid by the single-source continuum contractor under receivership. Requires DFPS, if the receiver is a DFPS employee, to pay the receiver the compensation ordered under this section and requires the single-source continuum contractor is required to reimburse DFPS. Sec. 264.195. LIABILITY OF RECEIVER. (a) Provides that a person does not have a cause of action against a receiver appointed under this subchapter for an action taken within the scope of the receivership unless the cause of action arises from a breach of fiduciary duty or the gross negligence or intentional acts of the receiver. (b) Provides that, notwithstanding Subsection (a), this section does not waive the sovereign immunity to suit and from liability of DFPS or a DFPS employee acting in an official capacity. Sec. 264.1955. OBLIGATIONS AND LIABILITY OF SINGLE-SOURCE CONTINUUM CONTRACTOR; SALE OR LEASE OF PROPERTY BY SINGLE-SOURCE CONTINUUM CONTRACTOR. (a) Provides that the appointment of a receiver under this subchapter does not relieve the single-source continuum contractor under receivership or any employee or agent of the contractor of civil or criminal liability arising out of an act or omission that occurred before the appointment of the receiver, an obligation for the payment of taxes, operational or maintenance expenses, mortgages, leases, contractual obligations, or liens, or a duty imposed by law. (b) Authorizes a single-source continuum contractor under receivership to sell or lease a facility under receivership, subject to the approval of the appointing court. Sec. 264.196. TERMINATION OF RECEIVERSHIP. (a) Authorizes the appointing court to terminate a receivership if the court determines that the receivership is no longer necessary because the conditions that gave rise to the receivership no longer exist, DFPS has entered into a new contract with a single-source continuum contractor and that contractor is ready and able to assume the duties of the single-source continuum contractor under receivership, or DFPS is ready and able to assume the duties of the single-source continuum contractor under receivership. (b) Requires a receiver, not later than the 60th day after the date a receivership is terminated or expires under this subchapter, unless such time is extended by order of the appointing court, to file with the clerk of the appointing court a full and final and sworn account of all property received by the receiver, all money collected and disbursed, and the expenses of the receivership. SECTION 3. Effective date: upon passage or September 1, 2025.
BILL ANALYSIS
Senate Research Center S.B. 2034
89R9872 AMF-F By: Paxton
Health & Human Services
3/21/2025
As Filed
Senate Research Center
S.B. 2034
89R9872 AMF-F
By: Paxton
Health & Human Services
3/21/2025
As Filed
AUTHOR'S / SPONSOR'S STATEMENT OF INTENT
Current statute does not grant the Department of Family and Protective Services (DFPS) the ability to act swiftly if a single source continuum contractor (SSCC) does not meet its contractual duties or poses a threat to child safety and well-being. The progressive intervention plan outlined in the current SSCC contractwhich is comprised of the ability for DFPS to impose continuous quality improvement plans, corrective action plans, or to seek contract terminationdoes not provide an expedient manner by which DFPS can ensure continuity of services and the safety of the children that are under an SSCC's care when there are severe concerns with an SSCC's performance or actions.
This bill allows DFPS to petition a court of competent jurisdiction for receivership of an SSCC or any of its parts, divisions, components, or companies that deliver community-based care (CBC). This proposed solution enables the receiver to continue to carry out the contractual duties and ensures the safety and well-being of the population served when expedient action is necessary.
As proposed, S.B. 2034 amends current law relating to the receivership of a single-source continuum contractor providing child welfare services.
RULEMAKING AUTHORITY
This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.
SECTION BY SECTION ANALYSIS
SECTION 1. Amends Section 64.001(a), Civil Practice and Remedies Code, as follows:
(a) Authorizes a court of competent jurisdiction to appoint a receiver in certain cases, including for a single-source continuum contractor as provided by Subchapter B-2, Chapter 264 (Child Welfare Services), Family Code. Makes a nonsubstantive change.
SECTION 2. Amends Chapter 264. Family Code, by adding Subchapter B-2, as follows:
SUBCHAPTER B-2. RECEIVER FOR SINGLE-SOURCE CONTINUUM CONTRACTOR
Sec. 264.191. DEFINITIONS. Defines "catchment area," "community-based care contract," and "single-source continuum contractor."
Sec. 264.1915. RECEIVER OF SINGLE-SOURCE CONTINUUM CONTRACTOR. Authorizes a court of competent jurisdiction to appoint a receiver for a single-source continuum contractor or any of its parts, divisions, components, or companies on the petition of the Department of Family and Protective Services (DFPS) if:
(1) after being subject to a quality improvement plan, corrective action plan, or other remedial statutory or contract measures, the contractor continues to fail to satisfactorily perform under the community-based care contract;
(2) the contractor provides DFPS notice of the contractor's intent to cease operations not later than the 60th day before the date the contractor intends to cease operations and has not made arrangements for another single-source continuum contractor or DFPS to continue the uninterrupted provision of services under the community-based care contract;
(3) conditions exist, as determined by DFPS, within the contractor that present an imminent danger to the health, safety, or welfare of the children under the conservatorship of DFPS in the contractor's care;
(4) the contractor has failed to provide adequate information to DFPS regarding a child under the conservatorship of DFPS in the contractor's care;
(5) the contractor has failed to comply with a court order or incurred a sanction against DFPS due to failure to comply with a court order; or
(6) the contractor cannot meet or is unlikely to be able to meet financial obligations related to services provided under the community-based care contract, including financial obligations to employees, contractors, or foster parents.
Sec. 264.192. PROCEEDING TO APPOINT RECEIVER. (a) Requires a court, except as otherwise provided by law, to give precedence to a petition for the appointment of a receiver under this subchapter over other matters.
(b) Requires a court to conduct an evidentiary hearing on a petition for the appointment of a receiver under this subchapter not later than the fifth day after the date the petition is filed. Requires DFPS to make reasonable efforts to notify the single-source continuum contractor of the hearing under this subsection.
(c) Requires a court to grant a petition for the appointment of a receiver under this subchapter on finding that one of the conditions described by Section 264.1915 exists and the continued existence of the condition jeopardizes the health, safety, or welfare of a child under the conservatorship of DFPS.
(d) Authorizes a court to grant a petition for the appointment of a receiver under this subchapter ex parte.
(e) Provides that the issuance of a check without sufficient money by the single-source continuum contractor or the existence of delinquent obligations for salaries, utilities, or essential services or commodities for the contractor is prima facie evidence that the contractor cannot meet or is unlikely to be able to meet financial obligations related to services provided under the community-based care contract as provided by Section 264.1915(6).
Sec. 264.1925. QUALIFICATIONS. (a) Requires a person, to be appointed as a receiver under this subchapter, to be qualified by education, training, or experience to carry out the duties of the receiver under this subchapter. Authorizes a receiver appointed under this subchapter, notwithstanding Section 64.021 (Qualifications; Residence Requirement), Civil Practice and Remedies Code, to be an employee of DFPS.
(b) Requires a court to appoint a receiver selected from a list of qualified persons developed by DFPS and filed with the court.
Sec. 264.193. LIMITED DURATION; ASSESSMENT. (a) Provides that a receivership under this subchapter expires on the 90th day after the date a receiver is appointed, unless DFPS files a petition for a 60-day extension of the receivership with the appointing court on or before the date the receivership expires. Authorizes DFPS to request multiple extensions under this subsection.
(b) Requires DFPS, on or before the 60th day after the date a receiver is appointed under this subchapter and every 60 days thereafter until the expiration or termination of the receivership, to file with the appointing court an assessment of ability of the single-source continuum contractor under receivership to ensure the health, safety, and welfare of the children under the conservatorship of DFPS in the contractor's care.
Sec. 264.1935. BOND. Provides that, notwithstanding Section 64.023 (Bond), Civil Practice and Remedies Code, a receiver appointed under this subchapter who is an employee of DFPS is not required to execute a bond.
Sec. 264.194. POWERS AND DUTIES OF RECEIVER. (a) Requires a receiver appointed under this subchapter to take all actions:
(1) ordered by the appointing court; and
(2) necessary to ensure the continued health, safety, and welfare of children under the conservatorship of DFPS in the care of the single-source continuum contractor under receivership, which are authorized to include certain actions;
(b) Provides that, notwithstanding any other law and to ensure continuous provision of necessary services to children under the conservatorship of DFPS and their families, a contract entered into by a receiver acting in accordance with the receiver's duties under this section is not subject to advertising, competitive bidding, or proposal evaluation requirements.
(c) Requires a receiver to compensate an employee hired in accordance with this section at a rate of compensation, including benefits, approved by the appointing court.
(d) Authorizes a receiver to petition the appointing court for temporary relief from obligations under a contract entered into by the single-source continuum contractor under receivership if the rent, price, or rate of interest substantially exceeds a reasonable rent, price, or rate of interest at the time the contractor entered into the contract or any material provision of the contract is unreasonable when compared to contracts negotiated under similar conditions.
(e) Provides that any relief granted by a court under Subsection (d) is limited to the life of the receivership, unless otherwise determined by the court.
(f) Requires a receiver appointed under this subchapter to deposit all money related to the receivership in a separate account and to use that account for all disbursements related to the receivership. Requires that a payment to a receiver of a sum owed to the single-source continuum contractor under receivership be considered a payment to the contractor with respect to the discharge of the obligation.
(g) Requires a receiver who is not a DFPS employee to coordinate with DFPS to ensure the continued health, safety, and welfare of the children in DFPS's conservatorship and compliance with all state and federal laws relating to child welfare.
(h) Requires a receiver to make a reasonable effort to facilitate the continued operation of the community-based care program under Subchapter B-1 (Community-Based Care) in the applicable catchment area.
Sec. 264.1945. COMPENSATION OF RECEIVER. Requires the appointing court to order compensation for a receiver appointed under this subchapter to be paid by the single-source continuum contractor under receivership. Requires DFPS, if the receiver is a DFPS employee, to pay the receiver the compensation ordered under this section and requires the single-source continuum contractor is required to reimburse DFPS.
Sec. 264.195. LIABILITY OF RECEIVER. (a) Provides that a person does not have a cause of action against a receiver appointed under this subchapter for an action taken within the scope of the receivership unless the cause of action arises from a breach of fiduciary duty or the gross negligence or intentional acts of the receiver.
(b) Provides that, notwithstanding Subsection (a), this section does not waive the sovereign immunity to suit and from liability of DFPS or a DFPS employee acting in an official capacity.
Sec. 264.1955. OBLIGATIONS AND LIABILITY OF SINGLE-SOURCE CONTINUUM CONTRACTOR; SALE OR LEASE OF PROPERTY BY SINGLE-SOURCE CONTINUUM CONTRACTOR. (a) Provides that the appointment of a receiver under this subchapter does not relieve the single-source continuum contractor under receivership or any employee or agent of the contractor of civil or criminal liability arising out of an act or omission that occurred before the appointment of the receiver, an obligation for the payment of taxes, operational or maintenance expenses, mortgages, leases, contractual obligations, or liens, or a duty imposed by law.
(b) Authorizes a single-source continuum contractor under receivership to sell or lease a facility under receivership, subject to the approval of the appointing court.
Sec. 264.196. TERMINATION OF RECEIVERSHIP. (a) Authorizes the appointing court to terminate a receivership if the court determines that the receivership is no longer necessary because the conditions that gave rise to the receivership no longer exist, DFPS has entered into a new contract with a single-source continuum contractor and that contractor is ready and able to assume the duties of the single-source continuum contractor under receivership, or DFPS is ready and able to assume the duties of the single-source continuum contractor under receivership.
(b) Requires a receiver, not later than the 60th day after the date a receivership is terminated or expires under this subchapter, unless such time is extended by order of the appointing court, to file with the clerk of the appointing court a full and final and sworn account of all property received by the receiver, all money collected and disbursed, and the expenses of the receivership.
SECTION 3. Effective date: upon passage or September 1, 2025.