Bill Text: TX HB1473 | 2019-2020 | 86th Legislature | Comm Sub

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Bill Title: Relating to disclosure of certain relationships with local government officers and vendors.

Spectrum: Bipartisan Bill

Status: (Introduced - Dead) 2019-05-09 - Committee report sent to Calendars [HB1473 Detail]

Download: Texas-2019-HB1473-Comm_Sub.html

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86R29338 TJB-D
By: Middleton, Dominguez, Bohac, Rosenthal, H.B. No. 1473
Biedermann
Substitute the following for H.B. No. 1473:
By: Bohac C.S.H.B. No. 1473

A BILL TO BE ENTITLED
AN ACT
relating to disclosure of certain relationships with local
government officers and vendors.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 176.001(1), (1-a), (2), and (2-d),
Local Government Code, are amended to read as follows:
(1) "Agent" means a third party who undertakes to
transact some business or manage some affair for another person by
the authority or on account of the other person. The term includes
a subcontractor and an employee.
(1-a) "Business relationship" means a connection
between two or more parties based on commercial activity of one of
the parties. [The term does not include a connection based on:
[(A) a transaction that is subject to rate or fee
regulation by a federal, state, or local governmental entity or an
agency of a federal, state, or local governmental entity;
[(B) a transaction conducted at a price and
subject to terms available to the public; or
[(C) a purchase or lease of goods or services
from a person that is chartered by a state or federal agency and
that is subject to regular examination by, and reporting to, that
agency.]
(2) "Family member" means a person related to another
person within the third [first] degree by consanguinity or the
second degree by affinity, as determined under [described by]
Subchapter B, Chapter 573, Government Code.
(2-d) "Investment income" means dividends, capital
gains, or interest income generated from:
(A) a personal or business:
(i) checking or savings account;
(ii) share draft or share account; or
(iii) other similar account;
(B) a personal or business investment other than
an investment in a:
(i) mutual fund; or
(ii) publicly traded company with a market
capitalization of $2 billion or more; [or]
(C) a personal or business loan; or
(D) a trust.
SECTION 2. Sections 176.003(a) and (e), Local Government
Code, are amended to read as follows:
(a) A local government officer shall file a conflicts
disclosure statement with respect to a vendor if:
(1) the vendor enters into a contract with the local
governmental entity or the local governmental entity is considering
entering into a contract with the vendor; and
(2) the vendor:
(A) has an employment or other business
relationship with the local government officer, [or] a family
member of the officer, or a business entity in which the officer or
a family member of the officer holds an ownership interest or is an
employee, that results in the officer, [or] family member, or
business entity receiving taxable income, including [other than]
investment income, that exceeds $2,500 during the 12-month period
preceding the date that the officer becomes aware that:
(i) a contract between the local
governmental entity and vendor has been executed; or
(ii) the local governmental entity is
considering entering into a contract with the vendor;
(B) has an employment or other business
relationship with the local government officer, a family member of
the officer, or a business entity in which the officer or a family
member of the officer holds an ownership interest or is an employee,
that the officer anticipates will result in the officer, family
member, or business entity receiving any amount of taxable income,
including investment income, in the future;
(C) has given to the local government officer,
[or] a family member of the officer, or a business entity in which
the officer or a family member of the officer holds an ownership
interest or is an employee, one or more gifts that have an aggregate
value of more than $100 in the 12-month period preceding the date
the officer becomes aware that:
(i) a contract between the local
governmental entity and vendor has been executed; or
(ii) the local governmental entity is
considering entering into a contract with the vendor; or
(D) [(C)] has a family relationship with the
local government officer.
(e) The commission shall adopt the conflicts disclosure
statement for local government officers for use under this
section. The conflicts disclosure statement must include:
(1) a requirement that each local government officer
disclose:
(A) an employment or other business relationship
described by Subsection (a)(2)(A) or (B), including the nature and
extent of the relationship; and
(B) gifts accepted by the local government
officer, [and] any family member of the officer, and any business
entity in which the officer or a family member of the officer holds
an ownership interest or is an employee, from a vendor during the
12-month period described by Subsection (a)(2)(C) [(a)(2)(B)] if
the aggregate value of the gifts accepted by the officer, [or a]
family member, or business entity from that vendor exceeds $100;
(2) an acknowledgment from the local government
officer that:
(A) the disclosure applies to each:
(i) family member of the officer; and
(ii) business entity in which the officer
or a family member of the officer holds an ownership interest or is
an employee; and
(B) the statement covers the 12-month period
described by Subsection (a)(2)(C) [(a)(2)(B)]; and
(3) the signature of the local government officer
acknowledging that the statement is made under oath under penalty
of perjury.
SECTION 3. Sections 176.006(a), (a-1), and (c), Local
Government Code, are amended to read as follows:
(a) A vendor shall file a completed conflict of interest
questionnaire if the vendor has a business relationship with a
local governmental entity and:
(1) has an employment or other business relationship
described by Section 176.003(a)(2)(A) or (B) with a local
government officer of that local governmental entity, [or] a family
member of the officer, or a business entity in which the officer or
a family member of the officer holds an ownership interest or is an
employee [described by Section 176.003(a)(2)(A)];
(2) has given a local government officer of that local
governmental entity, [or] a family member of the officer, or a
business entity in which the officer or a family member of the
officer holds an ownership interest or is an employee, one or more
gifts with the aggregate value specified by Section
176.003(a)(2)(C) [176.003(a)(2)(B)], excluding any gift described
by Section 176.003(a-1); or
(3) has a family relationship with a local government
officer of that local governmental entity.
(a-1) The completed conflict of interest questionnaire must
be filed with the appropriate records administrator not later than
the seventh business day after the later of:
(1) the date that the vendor:
(A) begins discussions or negotiations to enter
into a contract with the local governmental entity; or
(B) submits to the local governmental entity an
application, response to a request for proposals or bids,
correspondence, or another writing related to a potential contract
with the local governmental entity; or
(2) the date the vendor becomes aware:
(A) of an employment or other business
relationship [with a local government officer, or a family member
of the officer,] described by Subsection (a)(1) [(a)];
(B) that the vendor has given one or more gifts
described by Subsection (a)(2) [(a)]; or
(C) of a family relationship with a local
government officer.
(c) The questionnaire adopted under Subsection (b) must
require, for the local governmental entity with respect to which
the questionnaire is filed, that the vendor filing the
questionnaire:
(1) describe each employment or business [and family]
relationship described by Section 176.003(a)(2)(A) or (B) the
vendor has with each local government officer of the local
governmental entity, a family member of the officer, or a business
entity in which the officer or a family member of the officer holds
an ownership interest or is an employee;
(2) describe each family relationship the vendor has
with each local government officer of the local governmental
entity;
(3) identify each employment or business relationship
described by Subdivision (1) with respect to which the local
government officer, a family member of the officer, or a business
entity in which the officer or a family member of the officer holds
an ownership interest or is an employee, receives, or is likely to
receive, taxable income, including [other than] investment income,
from the vendor;
(4) [(3)] identify each employment or business
relationship described by Subdivision (1) with respect to which the
vendor receives, or is likely to receive, taxable income, including
[other than] investment income, that:
(A) is received from, or at the direction of, a
local government officer of the local governmental entity, a family
member of the officer, or a business entity in which the officer or
a family member of the officer holds an ownership interest or is an
employee; and
(B) is not received from the local governmental
entity; and
(5) [(4)] describe each employment or business
relationship with a corporation or other business entity with
respect to which a local government officer of the local
governmental entity[:
[(A)] serves as an officer or director[; or
[(B) holds an ownership interest of one percent
or more].
SECTION 4. Not later than December 1, 2019, the Texas Ethics
Commission shall adopt a conflicts disclosure statement consistent
with Section 176.003, Local Government Code, as amended by this
Act, and a conflict of interest questionnaire consistent with
Section 176.006, Local Government Code, as amended by this Act.
SECTION 5. The changes in law made by this Act apply only to
an event requiring disclosure that occurs on or after January 1,
2020. An event requiring disclosure that occurs before that date is
governed by the law applicable to the event immediately before that
date, and the former law is continued in effect for that purpose.
SECTION 6. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2019.