S.B. No. 5

AN ACT
relating to the administration and business affairs of public
institutions of higher education.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. FINANCIAL MANAGEMENT
SECTION 1.01. Section 51.003, Education Code, is amended by
amending Subsection (b) and adding Subsection (f) to read as
follows:
(b) The funds shall either be deposited in the depository
bank or banks or invested as authorized by Chapter 2256, Government
Code (Public Funds Investment Act). Funds that are to be deposited
in the depository bank or banks must be deposited within seven days
from the date of receipt by the institution [collection].
(f) Notwithstanding any other provision of this section,
the governing board of each institution may maintain unsecured
deposits in a foreign bank as necessary to support the
institution’s academic and research operations in the foreign
country in which the bank is located, provided that no appropriated
or tuition funds other than those collected from students enrolled
in the affected programs are deposited. The foreign bank must:
(1) be licensed and supervised by a central bank;
(2) be audited annually by an accounting firm that
follows international financial reporting standards; and
(3) maintain a capital to total assets ratio that is
not less than the greater of four percent or the minimum tier 1
capital to total assets ratio required for depository institutions
insured by the Federal Deposit Insurance Corporation.
SECTION 1.02. Subchapter A, Chapter 51, Education Code, is
amended by amending Section 51.005 and adding Sections 51.010,
51.011, and 51.012 to read as follows:
Sec. 51.005. REPORTS. Each institution of higher education
[(a) True and full accounts shall be kept by the governing board
and by the employees of the institution of all funds collected from
all sources and of all sums paid out and the persons to whom and the
purposes for which the sums are paid. The governing board] shall
prepare [annually print] a complete annual financial report as
prescribed by Section 2101.011, Government Code [of all the sums
collected, all expenditures, and all sums remaining on hand. The
report shall show the true condition of all funds as of the August
31 preceding as well as the collections and expenditures for the
preceding year.
[(b) Reports under this section must be in a form approved
jointly by the coordinating board and the comptroller. The
accounting and classification procedures of each institution must
be consistent with uniform procedures prescribed for that purpose
by the coordinating board and the comptroller. The requirements
imposed by the coordinating board and the comptroller must be
designed to reduce paperwork and duplicative reports.
[(c) The governing board shall furnish one copy of the
report each to the governor, comptroller of public accounts, state
auditor, Texas Higher Education Coordinating Board, Legislative
Budget Board, House Appropriations Committee, Senate Finance
Committee, and Legislative Reference Library. A copy of the report
shall be submitted to the comptroller by the deadline established
by the comptroller or the General Appropriations Act as necessary
to prepare an audited comprehensive financial report. The
governing board shall retain five copies of the report for
distribution to legislators or other state officials on request].
Sec. 51.010. COLLECTION OF DELINQUENT OBLIGATIONS. If
under the rules adopted by the attorney general under Chapter 2107,
Government Code, an institution of higher education is not required
to refer a delinquent obligation for collection to the attorney
general, the institution is not required to expend resources for
further collection efforts if, considering the amount, security,
likelihood of collection, expense, and available resources, the
institution determines that further collection should not be
actively pursued.
Sec. 51.011. DISPOSITION OF SMALL CREDIT BALANCES.
(a) This section applies to a credit balance of less than $25 held
by an institution of higher education that is presumed abandoned
under Chapter 72, Property Code.
(b) An institution of higher education may maintain an
unclaimed money fund and transfer to that fund a credit balance to
which this section applies. A deposit to the unclaimed money fund
does not affect the ownership of the amount deposited. The
institution shall:
(1) adopt procedures for owners to make and receive
payments of claims against the fund; and
(2) maintain a database that permits members of the
public to search for ownership of unclaimed funds.
(c) The institution of higher education shall use the fund
to pay the claims of persons establishing ownership of amounts
transferred to the fund and shall hold and account for the unclaimed
money fund as educational and general funds of the institution. If
the fund balance is insufficient to pay a valid claim, the
institution shall pay the claim from the institution’s other
educational and general funds.
(d) Each fiscal year, after deducting funds sufficient to
pay anticipated expenses of and claims against the unclaimed money
fund, the institution shall use the balance of the fund as other
educational and general funds of the institution.
(e) In consultation with institutions of higher education,
the comptroller by rule may establish minimum requirements for
notice to owners of unclaimed money deposited in the unclaimed
money fund and for charges for that notice. The rules may not
provide stricter requirements than the comptroller applies for
amounts of less than $25 in the custody of the comptroller under
Chapter 74, Property Code.
(f) If an institution of higher education maintains an
unclaimed money fund under this section, Chapter 74, Property Code,
does not apply to a credit balance to which this section applies.
Sec. 51.012. PAYMENTS BY ELECTRONIC FUNDS TRANSFER OR
ELECTRONIC PAY CARD. An institution of higher education may make
any payment through electronic funds transfer or by electronic pay
card.
SECTION 1.03. Subchapter Z, Chapter 51, Education Code, is
amended by adding Section 51.9741 to read as follows:
Sec. 51.9741. INTERNET ACCESS TO FINANCIAL TRANSACTIONS.
(a) Each institution of higher education, as defined by Section
61.003, shall post on the institution’s Internet website a copy of
the institution’s financial transactions to the extent necessary to
provide, for each payment drawn from money appropriated from the
state general revenue fund or received as student tuition or fee
payments:
(1) the amount of the payment;
(2) the date of the payment;
(3) a brief description of the purpose of the payment;
and
(4) the name of the payee.
(b) An institution of higher education may comply with this
section by providing on the institution’s Internet website an
easily noticeable direct link, the purpose of which is clearly
identifiable, to an Internet website maintained by the comptroller
that provides information concerning the institution that is
similar to the information required under Subsection (a).
SECTION 1.04. Section 65.42, Education Code, is amended to
read as follows:
Sec. 65.42. DELINQUENT ACCOUNTS; VENUE. A suit by The
University of Texas System on its own behalf or on behalf of a
component institution of The University of Texas System to recover
a delinquent loan, account, or debt owed to The University of Texas
System or a component institution of The University of Texas System
must [may] be brought in Travis County.
SECTION 1.05. Section 1231.001, Government Code, is amended
by amending Subdivision (2) and adding Subdivision (3) to read as
follows:
(2) “State security” means:
(A) an obligation, including a bond, issued by:
(i) a state agency;
(ii) an entity that is expressly created by
statute and has statewide jurisdiction; or
(iii) an entity issuing the obligation on
behalf of this state or on behalf of an entity described by
Subparagraph (i) or (ii);
(B) an installment sale or lease-purchase
obligation that is issued by or on behalf of an entity described by
Paragraph (A) and that has:
(i) a stated term of more than five years;
or
(ii) an initial principal amount of more
than $250,000; or
(C) an obligation, including a bond, that is
issued under Chapter 53, Education Code, at the request of or for
the benefit of an institution of higher education [as defined by
Section 61.003, Education Code,] other than a public junior
college.
(3) “Institution of higher education” has the meaning
assigned by Section 61.003, Education Code.
SECTION 1.06. Section 1231.041, Government Code, is amended
to read as follows:
Sec. 1231.041. APPROVAL OF STATE SECURITY. (a) Except as
otherwise provided by this section, an [An] entity, including a
state agency, may not issue a state security unless:
(1) the board approves the issuance; or
(2) the security is exempted under law, including a
board rule adopted under Section 1231.022(2).
(b) A state security issued by an institution of higher
education, or issued at the request of or for the benefit of an
institution of higher education, is not subject to board approval
if:
(1) the institution or the university system of which
the institution is a component has an unenhanced long-term debt
rating of at least AA- or its equivalent; and
(2) the general revenue of this state is not pledged to
the payment of the security.
SECTION 1.07. Section 74.001, Property Code, is amended by
adding Subsection (c) to read as follows:
(c) This chapter does not apply to small credit balances
held by an institution of higher education in an unclaimed money
fund under Section 51.011, Education Code.
SECTION 1.08. Section 51.011, Education Code, as added by
this Act, applies to credit balances held by a public institution of
higher education on or after the effective date of this Act.
ARTICLE 2. GOODS AND SERVICES
SECTION 2.01. Section 51.923, Education Code, is amended to
read as follows:
Sec. 51.923. QUALIFICATIONS OF CERTAIN BUSINESS ENTITIES TO
ENTER INTO CONTRACTS WITH AN INSTITUTION OF HIGHER EDUCATION.
(a) In this section:
(1) “Business entity” [“Corporation”] means any
entity recognized by law through which business is conducted,
including a sole proprietorship, partnership, firm, corporation,
limited liability company, holding company, joint stock company,
receivership, or trust [a corporation for profit organized under
the laws of this state or under laws other than the laws of this
state].
(2) “Governing board” has the meaning assigned by
Section 61.003 [of this code].
(3) “Institution of higher education” has the meaning
assigned by Section 61.003 [of this code].
(4) “Nonprofit corporation” means any organization
exempt from federal income tax under Section 501 of the Internal
Revenue Code of 1986 that does not distribute any part of its income
to any member, director, or officer.
(b) A nonprofit corporation is not disqualified from
entering into a contract or other transaction with an institution
of higher education even though one or more members of the governing
board of the institution of higher education also serves as a
member, [or] director, officer, or employee of the nonprofit
corporation.
(c) A business entity [corporation] is not disqualified
from entering into a contract or other transaction with an
institution of higher education even though one or more members of
the governing board of the institution of higher education have an
interest in the business entity, subject to Subsection (d) [also
serves as a stockholder or director of the corporation provided
that no member of the governing board owns or has a beneficial
interest in more than five percent of the corporation’s outstanding
capital stock and further provided that the contract or transaction
is:
[(1) an affiliation, licensing, or sponsored research
agreement; or
[(2) awarded by competitive bidding or competitive
sealed proposals].
(d) An institution of higher education is not prohibited
from entering into a contract or other transaction with a business
entity in which a member of the governing board of the institution
of higher education has an interest if the interest is not a
substantial interest or, if the interest is a substantial interest,
the [described in this section if any] board member [having an
interest described in this section in the contract or transaction]
discloses that interest in a meeting held in compliance with
Chapter 551, Government Code, and refrains from voting on the
contract or transaction requiring board approval. Any such
contract or transaction requiring board approval must be approved
by an affirmative majority of the board members voting on the
contract or transaction.
(e) For purposes of this section, a member of a governing
board has a substantial interest in a business entity if:
(1) the member owns 10 percent or more of the voting
stock or shares of the business entity or owns either 10 percent or
more or $15,000 or more of the fair market value of the business
entity;
(2) funds received by the member from the business
entity exceed 10 percent of the member’s gross income for the
previous year;
(3) the member is an officer of the business entity or
a member of the governing board of the business entity; or
(4) an individual related to the member in the first
degree by consanguinity or affinity, as determined under Chapter
573, Government Code, has an interest in the business entity as
described by Subdivision (1), (2), or (3).
(f) A violation of this section does not render an action of
the governing board voidable unless the contract or transaction
that was the subject of the action would not have been approved by
the governing board without the vote of the member who violated this
section.
SECTION 2.02. Section 51.9335, Education Code, is amended
by amending Subsections (d) and (f) and adding Subsections (g) and
(h) to read as follows:
(d) Subtitle D, Title 10, Government Code, and Subchapter B,
Chapter 2254, Government Code, do not apply to the acquisition of
goods and services under this section, except that an institution
of higher education must comply with any provision of those laws, or
a rule adopted under a provision of those laws, [To the extent of
any conflict, this section prevails over any other law, including
Chapters 2155, 2156, 2157, 2158, 2167, and 2170, Government Code,
except a law or rule] relating to contracting with historically
underutilized businesses or relating to the procurement of goods
and services from persons with disabilities. An institution of
higher education may, but is not required to, acquire goods or
services as provided by Subtitle D, Title 10 [Chapters 2155, 2156,
2157, 2158, 2167, and 2170], Government Code.
(f) This section does not apply to professional services as
defined by Section 2254.002, Government Code. Professional
services shall be procured in accordance with Subchapter A, Chapter
2254, Government Code.
(g) An institution of higher education may adopt rules and
procedures for the acquisition of goods or services.
(h) In any contract for the acquisition of goods and
services to which an institution of higher education is a party, a
provision required by applicable law to be included in the contract
is considered to be a part of the executed contract without regard
to:
(1) whether the provision appears on the face of the
contract; or
(2) whether the contract includes any provision to the
contrary.
SECTION 2.03. Subchapter Z, Chapter 51, Education Code, is
amended by adding Section 51.9336 to read as follows:
Sec. 51.9336. ELECTRONIC AND DIGITAL SIGNATURES. (a) An
institution of higher education or university system, as those
terms are defined by Section 61.003, shall determine whether, and
the extent to which, the institution or system will send and accept
electronic or digital signatures to and from other persons and
otherwise create, generate, communicate, store, process, use, and
rely on electronic or digital signatures. The institution or
system may adopt rules and procedures governing the use of
electronic or digital signatures.
(b) To the extent of any conflict, this section prevails
over Chapter 322, Business & Commerce Code, and rules and
guidelines adopted under that chapter.
SECTION 2.04. Section 51.966, Education Code, is amended by
amending Subsection (c) and adding Subsection (d) to read as
follows:
(c) Section 612.002(b), Government Code, does not apply to
an institution of higher education or university system purchasing
insurance under this section.
(d) In [As used in] this section, “governing board,” [and]
“institution of higher education,” and “university system” have the
meanings assigned by Section 61.003.
SECTION 2.05. Subchapter C, Chapter 791, Government Code,
is amended by adding Section 791.035 to read as follows:
Sec. 791.035. CONTRACTS WITH INSTITUTIONS OF HIGHER
EDUCATION OR UNIVERSITY SYSTEMS. (a) A local government and an
institution of higher education or university system may contract
with one another to perform any governmental functions and
services. If the terms of the contract provide for payment based on
cost recovery, any law otherwise requiring competitive procurement
does not apply to the functions and services covered by the
contract.
(b) In this section, “institution of higher education” and
“university system” have the meanings assigned by Section 61.003,
Education Code.
SECTION 2.06. Section 2054.008, Government Code, is amended
by adding Subsection (c) to read as follows:
(c) A university system or institution of higher education
must provide written notice to the Legislative Budget Board under
Subsection (b) only if the cost of the major information system
exceeds $1 million. In this subsection, “university system” has
the meaning assigned by Section 61.003, Education Code.
SECTION 2.07. Subsection (n), Section 2155.078, Government
Code, is amended to read as follows:
(n) This section does not apply to an institution [a medical
and dental unit] to which Section 51.9335, Education Code, applies
or to an institution to which Section 73.115, Education Code,
applies.
ARTICLE 3. HUMAN RESOURCES
SECTION 3.01. Subchapter Z, Chapter 51, Education Code, is
amended by adding Section 51.9611 to read as follows:
Sec. 51.9611. PAYROLL DEDUCTIONS FOR EMPLOYEES OF
UNIVERSITY SYSTEM OR INSTITUTION OF HIGHER EDUCATION. (a) In this
section, “institution of higher education” and “university system”
have the meanings assigned by Section 61.003.
(b) The governing board of a university system, or of an
institution of higher education that is not a component institution
of a university system, may authorize employees of the system or
institution, as applicable, to elect a payroll deduction for any
purpose that the governing board determines serves a public purpose
and benefits employees. The board may adopt policies and
procedures governing payroll deductions under this section. A
payroll deduction under this section is in addition to payroll
deductions authorized by other law.
(c) A payroll deduction under this section must be at the
written request of the employee, and the request must state the
amount to be deducted and the entity to which the deducted amount is
to be transferred. A payroll deduction is in effect until revoked
in writing by the employee, but the policies and procedures of the
university system or institution of higher education, as
applicable, may provide for enrollment periods.
(d) A university system or institution of higher education
may collect an administrative fee to cover the costs of making a
deduction.
(e) This section does not authorize a payroll deduction for
dues or membership fees payable to a labor union or employees
association.
SECTION 3.02. Subchapter C, Chapter 1601, Insurance Code,
is amended by adding Section 1601.111 to read as follows:
Sec. 1601.111. PROGRAMS PROMOTING DISEASE PREVENTION,
WELLNESS, AND HEALTH. A system may establish premium discounts,
surcharges, rebates, or a revision in otherwise applicable
copayments, coinsurance, or deductibles, or any combination of
those incentives, for an individual who participates in
system-approved programs promoting disease prevention, wellness,
and health.
SECTION 3.03. Subsection (d), Section 1601.201, Insurance
Code, is amended to read as follows:
(d) Subsection (c) does not prohibit a system from
contributing, from money not appropriated from the general revenue
fund, amounts in excess of the amount specified by that subsection
for:
(1) an individual employed by the system in a position
that as a condition of employment requires the individual to be
enrolled as a student in the system in graduate level courses; or
(2) an individual who is a tenured faculty member with
whom the system has entered into a phased retirement agreement
under which the individual will work less than 40 hours a week for a
specified period of time at the end of which the individual will
retire.
SECTION 3.04. Subchapter E, Chapter 1601, Insurance Code,
is amended by adding Section 1601.2041 to read as follows:
Sec. 1601.2041. EMPLOYEE DEDUCTION FOR AUTOMATIC COVERAGE.
Each individual automatically enrolled in a uniform program under
Section 1601.104 is considered to have authorized a deduction from
the participant’s monthly compensation in an amount equal to the
difference between:
(1) the total cost of the employee’s basic coverage;
and
(2) the amount contributed by the system for the
employee’s basic coverage.
ARTICLE 4. REAL ESTATE AND CONSTRUCTION
SECTION 4.01. Subchapter C, Chapter 61, Education Code, is
amended by adding Section 61.0573 to read as follows:
Sec. 61.0573. EXPEDITED PROCESS FOR CERTAIN PROJECTS.
(a) In this section, “project” means the acquisition of improved
or unimproved real property or the construction, repair, or
rehabilitation of a building or other facility.
(b) Board approval of a project at an institution of higher
education is not required under Section 61.0572 or 61.058 if the
institution notifies the board of the project and certifies to the
board that:
(1) the institution meets the current published board
standards applicable to the institution for space need, usage
efficiency, deferred maintenance, and critical deferred
maintenance or the board has approved the institution’s plan to
correct any deficiencies in the institution’s compliance with those
applicable standards;
(2) the project meets current published board
standards applicable to the project for cost, efficiency, and space
use;
(3) the project is identified on the institution’s
campus master plan, as submitted to the board; and
(4) the institution has no deficiencies according to
the board’s most recent facilities audit or the board has approved
the institution’s plan to correct any such deficiencies.
(c) The board’s staff shall promptly review a certification
submitted under Subsection (b) and notify the institution whether
the certification is sufficient and whether the information
certified is consistent with the records of the board. If the staff
review determines that the certification is sufficient and that the
information certified is consistent with the records of the board,
the project is considered approved by the board.
(d) This section does not apply to a project that is a new
branch campus, a new off-campus educational unit, or a new higher
education center.
SECTION 4.02. Subsection (c), Section 2166.302, Government
Code, is amended to read as follows:
(c) Subsection (a) does not apply to a project constructed
by and for the Texas Department of Transportation or an institution
of higher education or university system. In this subsection,
“institution of higher education” and “university system” have the
meanings assigned by Section 61.003, Education Code.
SECTION 4.03. Subsection (c-1), Section 2166.403,
Government Code, is amended to read as follows:
(c-1) For a project constructed by and for a state
institution of higher education, the [governing body of the]
institution shall, during the planning phase of the proposed
construction for the project, verify [in an open meeting] the
economic feasibility of incorporating into the building’s design
and proposed energy system alternative energy devices for space
heating and cooling functions, water heating functions, electrical
load functions, and interior lighting functions. The [governing
body of the] institution shall determine the economic feasibility
of each function listed in this subsection by comparing the
estimated cost of providing energy for the function, based on the
use of conventional design practices and energy systems, with the
estimated cost of providing energy for the function, based on the
use of alternative energy devices, during the economic life of the
building.
SECTION 4.04. Subsection (b), Section 2167.001, Government
Code, is amended to read as follows:
(b) This chapter does not apply to:
(1) radio antenna space;
(2) residential space for a Texas Department of Mental
Health and Mental Retardation program;
(3) residential space for a Texas Youth Commission
program;
(4) space to be used for less than one month for
meetings, conferences, conventions, seminars, displays,
examinations, auctions, or similar purposes;
(5) district office space for members of the
legislature;
(6) space used by the Texas Workforce Commission;
(7) residential property acquired by the Texas
Department of Housing and Community Affairs or the Texas State
Affordable Housing Corporation that is offered for sale or rental
to individuals and families of low or very low income or families of
moderate income;
(8) except as provided by Section 2167.007, [classroom
and instructional] space for a university system or [an]
institution of higher education; or
(9) space leased by the Texas Veterans Commission to
administer the veterans employment services program.
SECTION 4.05. Section 33.06, Tax Code, is amended by adding
Subsection (g) to read as follows:
(g) If the ownership interest of an individual entitled to a
deferral under this section is a life estate, a lien for the
deferred tax attaches to the estate of the life tenant, and not to
the remainder interest, if the owner of the remainder is an
institution of higher education that has not consented to the
deferral. In this subsection, “institution of higher education”
has the meaning assigned by Section 61.003, Education Code. This
subsection does not apply to a deferral for which the individual
entitled to the deferral filed the affidavit required by Subsection
(b) before September 1, 2011.
ARTICLE 5. BOARD APPOINTMENTS
SECTION 5.01. Section 552.123, Government Code, is amended
to read as follows:
Sec. 552.123. EXCEPTION: NAME OF APPLICANT FOR CHIEF
EXECUTIVE OFFICER OF INSTITUTION OF HIGHER EDUCATION. The name of
an applicant for the position of chief executive officer of an
institution of higher education, and other information that would
tend to identify the applicant, is excepted from the requirements
of Section 552.021, except that the governing body of the
institution must give public notice of the name or names of the
finalists being considered for the position at least 21 days before
the date of the meeting at which final action or vote is to be taken
on the employment of the person.
SECTION 5.02. Subsection (b), Section 95.006, Health and
Safety Code, is amended to read as follows:
(b) The advisory committee is composed of:
(1) the following representatives appointed by the
executive director of the office:
(A) one representative of the office;
(B) one representative of the Texas Education
Agency;
(C) one representative of the Texas Pediatric
Society;
(D) one representative of the American Diabetes
Association;
(E) [one representative who is a member of the
board of regents of The University of Texas–Pan American;
[(F)] one school nurse representative from an
urban school located within the boundaries of a regional education
service center;
(F) [(G)] one parent or guardian of a child who
resides within the boundaries of a regional education service
center; and
(G) [(H)] one person with knowledge and
experience in health care in school settings; and
(2) the following representatives appointed by the
chairman of the council:
(A) one representative of the council;
(B) one representative of the Texas Medical
Association;
(C) one school district administrator
representative from a school district located within the boundaries
of a regional education service center;
(D) one school principal representative from a
school district located within the boundaries of a regional
education service center; and
(E) one school nurse representative from a rural
school located within the boundaries of a regional education
service center.
SECTION 5.03. Subsections (a) and (c), Section 2.03,
Chapter 670, Acts of the 72nd Legislature, Regular Session, 1991
(Article 4477-7j, Vernon’s Texas Civil Statutes), are amended to
read as follows:
(a) On or after the effective date of this Act, the
Commissioners Court of Gaines County shall appoint three persons,
the governing body of the city of Seminole shall appoint two
persons, and the governing body of the city of Seagraves shall
appoint two persons to serve as initial directors of the district.
The four persons appointed by the governing bodies of the cities of
Seminole and Seagraves shall represent the municipalities within
the county, and the three persons appointed by the Commissioners
Court of Gaines County shall represent the unincorporated areas of
the county. [In addition, the board of regents of The University of
Texas System shall appoint one person to serve as an ex-officio,
nonvoting director of the district.]
(c) The Commissioners Court of Gaines County and the
governing bodies of the cities of Seminole and Seagraves shall each
appoint one initial director to serve a term expiring on May 1 of
the first year after the year in which the original appointment is
made. In addition, the Commissioners Court of Gaines County shall
appoint two initial directors and the governing bodies of the
cities of Seminole and Seagraves shall each appoint one initial
director to serve terms expiring on May 1 of the second year after
the year in which the original appointment is made. [The initial
ex-officio member serves a term expiring on May 1 of the second year
after the year in which the original appointment is made.]
Successor directors serve two-year terms.
SECTION 5.04. Subsection (a), Section 3.01, Chapter 670,
Acts of the 72nd Legislature, Regular Session, 1991 (Article
4477-7j, Vernon’s Texas Civil Statutes), is amended to read as
follows:
(a) The district is governed by a board of directors
composed of seven voting members [and one ex-officio nonvoting
member] who are appointed as provided by this Act. However, the
district shall change to a system of electing the voting directors
if:
(1) the Commissioners Court of Gaines County and the
governing bodies of the cities of Seminole and Seagraves each pass a
resolution calling for the election of the directors; or
(2) the board receives a petition signed by at least
150 registered voters of Gaines County calling for the election of
the directors.
ARTICLE 6. REPORTS; RECORDS; AUDITS; NOTICES
SECTION 6.01. Subsection (n), Section 51.3062, Education
Code, is amended to read as follows:
(n) Each institution of higher education, other than a
medical and dental unit, shall report annually to the board on the
success of its students and the effectiveness of its Success
Initiative.
SECTION 6.02. Subsection (d), Section 51.403, Education
Code, is amended to read as follows:
(d) For purposes of this subsection, “small classes” [Each
institution shall file with its governing board and the
coordinating board a small class report, excluding individual
instruction courses, indicating department, course number, title
of course, and the name of the instructor. “Small classes,” for the
purpose of this report,] are undergraduate-level courses with less
than 10 registrations, and graduate-level courses with less than 5
registrations. No small classes shall be offered in any
institution except as authorized by the appropriate governing
board, within the guidelines established by the Coordinating Board.
SECTION 6.03. Subchapter H, Chapter 51, Education Code, is
amended by adding Section 51.406 to read as follows:
Sec. 51.406. EXPIRATION OF CERTAIN REPORTING REQUIREMENTS
APPLICABLE TO INSTITUTIONS OF HIGHER EDUCATION AND UNIVERSITY
SYSTEMS. (a) In this section, “university system” has the meaning
assigned by Section 61.003.
(b) To the extent that any of the following laws require
reporting by a university system or an institution of higher
education, a university system or institution of higher education
is not required to make the report on or after September 1, 2013,
unless legislation enacted by the 83rd Legislature that becomes law
expressly requires the institution or system to make the report:
(1) Section 7.109;
(2) Section 33.083;
(3) Section 59.07;
(4) Section 130.086;
(5) Section 325.007, Government Code;
(6) Section 669.003, Government Code;
(7) Section 2005.007, Government Code;
(8) Section 2054.097, Government Code;
(9) Chapter 2114, Government Code; and
(10) Section 2205.041, Government Code.
(c) A rule or policy of a state agency, including the Texas
Higher Education Coordinating Board, in effect on June 1, 2011,
that requires reporting by a university system or an institution of
higher education has no effect on or after September 1, 2013, unless
the rule or policy is affirmatively and formally readopted before
that date by formal administrative rule published in the Texas
Register and adopted in compliance with Chapter 2001, Government
Code. This subsection does not apply to:
(1) a rule or policy for which the authorizing statute
is listed in Subsection (b);
(2) a rule or policy for which the authorizing statute
is repealed on or before September 1, 2013, by legislation enacted
by the legislature that becomes law; or
(3) a report required under any of the following laws:
(A) Section 51.005;
(B) Section 51.3062;
(C) Section 51.402;
(D) Section 56.039;
(E) Section 61.051(k);
(F) Section 61.059; or
(G) Section 62.095(b).
SECTION 6.04. Section 51.914, Education Code, is amended to
read as follows:
Sec. 51.914. PROTECTION OF CERTAIN INFORMATION. (a) In
order to protect the actual or potential value, the following
information is [shall be] confidential and is [shall] not [be]
subject to disclosure under Chapter 552, Government Code, or
otherwise:
(1) all information relating to a product, device, or
process, the application or use of such a product, device, or
process, and all technological and scientific information
(including computer programs) developed in whole or in part at a
state institution of higher education, regardless of whether
patentable or capable of being registered under copyright or
trademark laws, that have a potential for being sold, traded, or
licensed for a fee;
(2) any information relating to a product, device, or
process, the application or use of such product, device, or
process, and any technological and scientific information
(including computer programs) that is the proprietary information
of a person, partnership, corporation, or federal agency that has
been disclosed to an institution of higher education solely for the
purposes of a written research contract or grant that contains a
provision prohibiting the institution of higher education from
disclosing such proprietary information to third persons or
parties; or
(3) the plans, specifications, blueprints, and
designs, including related proprietary information, of a
scientific research and development facility that is jointly
financed by the federal government and a local government or state
agency, including an institution of higher education, if the
facility is designed and built for the purposes of promoting
scientific research and development and increasing the economic
development and diversification of this state.
(b) Information maintained by or for an institution of
higher education that would reveal the institution’s plans or
negotiations for commercialization or a proposed research
agreement, contract, or grant, or that consists of unpublished
research or data that may be commercialized, is not subject to
Chapter 552, Government Code, unless the information has been
published, is patented, or is otherwise subject to an executed
license, sponsored research agreement, or research contract or
grant. In this subsection, “institution of higher education” has
the meaning assigned by Section 61.003.
SECTION 6.05. Section 130.152, Education Code, is amended
to read as follows:
Sec. 130.152. CRITERIA FOR PROGRAMS FOR THE DISADVANTAGED.
A junior college may develop programs to serve persons from
backgrounds of economic or educational deprivation by submission of
a plan based on the following criteria to the Texas Higher Education
Coordinating Board[, Texas College and University System]:
(1) an instructional program that accommodates the
different learning rates of students and compensates for prior
economic and educational deprivation;
(2) an unrestricted admissions policy allowing the
enrollment of any person 18 years of age or older with a high school
diploma or its equivalent who can reasonably be expected to benefit
from instruction;
(3) the assurance that all students, regardless of
their differing programs of study, will be considered, known, and
recognized as full members of the student body, provided that the
administrative officers of a junior college may deny admission to a
prospective student or attendance of an enrolled student if, in
their judgment, the person [he] would not be competent to benefit
from a program of the college, or would by the person’s [his]
presence or conduct create a disruptive atmosphere within the
college not consistent with the statutory purposes of the college;
(4) [the submission of a plan for a financial aid
program which removes to the maximum extent possible the financial
barriers to the educational aspirations of the citizens of this
state;
[(5) an annual evaluation report based on scientific
methods and utilizing control groups wherever possible to be
submitted to the coordinating board at the end of each school year,
covering each remedial-compensatory course or program offered at
the college;
[(6)] any other criteria consistent with the
provisions of this subchapter specified by the coordinating board;
and
(5) [(7)] a junior college must obtain approval of the
coordinating board [Coordinating Board, Texas College and
University System,] before offering any courses under the
provisions of this Act.
SECTION 6.06. Section 401.042, Government Code, is amended
by adding Subsection (c) to read as follows:
(c) In consultation with public institutions of higher
education, the offices of the governor and the Legislative Budget
Board shall review the forms for higher education legislative
appropriations requests to identify opportunities to improve
efficiency, provide better transparency of funding sources,
eliminate unnecessary or duplicative requirements, and otherwise
reduce the cost or difficulty of providing information related to
appropriations requests.
SECTION 6.07. Subchapter L, Chapter 403, Government Code,
is amended by adding Section 403.2715 to read as follows:
Sec. 403.2715. UNIVERSITY SYSTEMS AND INSTITUTIONS OF
HIGHER EDUCATION. (a) In this section, “institution of higher
education” and “university system” have the meanings assigned by
Section 61.003, Education Code.
(b) Except as provided by this section, this subchapter does
not apply to a university system or institution of higher
education.
(c) A university system or institution of higher education
shall account for all personal property as defined by the
comptroller under Section 403.272. At all times, the property
records of a university system or institution of higher education
must accurately reflect the personal property possessed by the
system or institution.
(d) The chief executive officer of each university system or
institution of higher education shall designate one or more
property managers. The property manager shall maintain the records
required and be the custodian of all personal property possessed by
the system or institution.
(e) Sections 403.273(h), 403.275, and 403.278 apply to a
university system or institution of higher education.
SECTION 6.08. Subsection (d), Section 2101.0115,
Government Code, is amended by adding Subdivision (4) to read as
follows:
(4) “Institution of higher education” and “university
system” have the meanings assigned by Section 61.003, Education
Code.
SECTION 6.09. Section 2101.0115, Government Code, is
amended by adding Subsection (e) to read as follows:
(e) This section does not apply to an institution of higher
education or university system.
SECTION 6.10. Subsection (c), Section 2254.028, Government
Code, is amended to read as follows:
(c) Subsection (a) [(a)(3)] does not apply to a major
consulting services contract to be entered into by an institution
of higher education other than a public junior college if the
institution includes in the invitation published under Section
2254.029 a finding by the chief executive officer of the
institution that the consulting services are necessary and an
explanation of that finding.
SECTION 6.11. Section 2254.0301, Government Code, is
amended to read as follows:
Sec. 2254.0301. CONTRACT NOTIFICATION. (a) A state agency
shall provide written notice to the Legislative Budget Board of a
contract for consulting services if the amount of the contract,
including an amendment, modification, renewal, or extension of the
contract, exceeds $14,000. The notice must be on a form prescribed
by the Legislative Budget Board and filed not later than the 10th
day after the date the entity enters into the contract.
(b) This section does not apply to a university system or
institution of higher education. In this subsection, “institution
of higher education” and “university system” have the meanings
assigned by Section 61.003, Education Code.
SECTION 6.12. Subsection (f), Section 388.005, Health and
Safety Code, is amended to read as follows:
(f) This section does not apply to a state agency or an
institution of higher education that the State Energy Conservation
Office determines [that], before September 1, 2007, adopted a plan
for conserving energy under which the agency or institution
established a percentage goal for reducing the consumption of
electricity. The exemption provided by this section applies only
while the agency or institution has an energy conservation plan in
effect and only if the agency or institution submits reports on the
conservation plan each year [calendar quarter] to the governor, the
Legislative Budget Board, and the State Energy Conservation Office.
SECTION 6.13. Section 412.053, Labor Code, is amended by
adding Subsection (c) to read as follows:
(c) This section does not apply to an institution of higher
education or university system. In this subsection, “institution
of higher education” and “university system” have the meanings
assigned by Section 61.003, Education Code.
SECTION 6.14. Subsection (d), Section 31.153, Natural
Resources Code, is amended to read as follows:
(d) Each state agency, other than an institution of higher
education, annually at the time set by the division, shall furnish
the Texas Historical Commission with a photograph and information
that specifies and identifies the age of each building:
(1) that was acquired by the agency after the date of
the preceding annual submission and that is at least 45 years old on
the date of the current submission; or
(2) that is possessed by the agency and has become 45
years old since the date the information was previously submitted.
ARTICLE 7. STUDENT FEE ADVISORY COMMITTEES
SECTION 7.01. Subchapter E, Chapter 54, Education Code, is
amended by adding Section 54.5033 to read as follows:
Sec. 54.5033. STUDENT FEE ADVISORY COMMITTEE MEETINGS OPEN
TO PUBLIC. (a) A student fee advisory committee established under
this chapter shall conduct meetings at which a quorum is present in
a manner that is open to the public and in accordance with
procedures prescribed by the president of the institution.
(b) The procedures prescribed by the president must:
(1) provide for notice of the date, hour, place, and
subject of the meeting at least 72 hours before the meeting is
convened; and
(2) require that the notice be:
(A) posted on the Internet; and
(B) published in a student newspaper of the
institution, if an issue of the newspaper is published between the
time of the Internet posting and the time of the meeting.
(c) The final recommendations made by a student fee advisory
committee must be recorded and made public.
ARTICLE 8. HEALTH SCIENCE CENTER
SECTION 8.01. Subtitle D, Title 3, Education Code, is
amended by adding Chapter 89 to read as follows:
CHAPTER 89. THE TEXAS A&M UNIVERSITY SYSTEM HEALTH SCIENCE CENTER
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 89.001. DEFINITIONS. In this chapter:
(1) “Board” means the board of regents of The Texas A&M
University System.
(2) “Health science center” means The Texas A&M
University System Health Science Center.
Sec. 89.002. COMPOSITION. (a) The Texas A&M University
System Health Science Center is composed of the following component
institutions, agencies, and programs under the management and
control of the board:
(1) The Texas A&M University System Health Science
Center College of Medicine;
(2) The Texas A&M University System Health Science
Center Baylor College of Dentistry;
(3) The Texas A&M University System Health Science
Center School of Rural Public Health;
(4) The Texas A&M University System Health Science
Center Irma Lerma Rangel College of Pharmacy;
(5) The Texas A&M University System Health Science
Center College of Nursing;
(6) The Texas A&M University System Health Science
Center School of Graduate Studies;
(7) The Texas A&M University System Health Science
Center Institute of Biosciences and Technology;
(8) The Texas A&M University System Health Science
Center Coastal Bend Health Education Center;
(9) The Texas A&M University System Health Science
Center South Texas Health Center; and
(10) The Texas A&M University System Health Science
Center Rural and Community Health Institute.
(b) The Texas A&M University System Health Science Center
Baylor College of Dentistry may use the name “Baylor” only:
(1) in accordance with:
(A) a license agreement between the health
science center and Baylor University; or
(B) other written approval from Baylor
University; or
(2) as otherwise permitted by law.
Sec. 89.003. MANDATORY VENUE. (a) Venue for a suit filed
against the health science center, any component institution,
agency, or program of the health science center, or any officer or
employee of the health science center is in Brazos County.
(b) This section does not waive any defense to or immunity
from suit or liability that may be asserted by an entity or
individual described by this section.
(c) In case of a conflict between this section and any other
law, this section controls.
Sec. 89.004. EXPENDITURE OF STATE FUNDS. The board is
authorized to expend funds appropriated to it by the legislature
for all lawful purposes of the health science center and its
component institutions, agencies, and programs as well as funds
available under the authority of Section 18, Article VII, Texas
Constitution, for the purposes expressed in that section for the
support of the health science center and its component
institutions, agencies, and programs.
[Sections 89.005-89.050 reserved for expansion]
SUBCHAPTER B. THE TEXAS A&M UNIVERSITY SYSTEM HEALTH SCIENCE
CENTER IRMA LERMA RANGEL COLLEGE OF PHARMACY
Sec. 89.051. THE TEXAS A&M UNIVERSITY SYSTEM HEALTH SCIENCE
CENTER IRMA LERMA RANGEL COLLEGE OF PHARMACY. (a) The board shall
maintain a college of pharmacy as a component of the health science
center.
(b) The college shall be known as The Texas A&M University
System Health Science Center Irma Lerma Rangel College of Pharmacy,
and the primary building in which the school is operated in Kleberg
County must include “Irma Rangel” in its official name.
SECTION 8.02. Subdivision (5), Section 61.003, Education
Code, is amended to read as follows:
(5) “Medical and dental unit” means The Texas A&M
University System Health Science Center and its component
institutions, agencies, and programs; The University of Texas
Medical Branch at Galveston; The University of Texas Southwestern
Medical Center at Dallas; The University of Texas Medical School at
San Antonio; The University of Texas Dental Branch at Houston; The
University of Texas M. D. Anderson Cancer Center; The University of
Texas Graduate School of Biomedical Sciences at Houston; The
University of Texas Dental School at San Antonio; The University of
Texas Medical School at Houston; The University of Texas Health
Science Center–South Texas and its component institutions, if
established under Subchapter N, Chapter 74; the nursing
institutions of The Texas A&M University System and The University
of Texas System; and The University of Texas School of Public Health
at Houston; and such other medical or dental schools as may be
established by statute or as provided in this chapter.
SECTION 8.03. Section 89.003, Education Code, as added by
this Act, applies only to an action brought against The Texas A&M
University System Health Science Center, a component institution,
agency, or program of that center, or an officer or employee of that
center on or after the effective date of this Act.
ARTICLE 9. REPEALER
SECTION 9.01. (a) The following laws are repealed
effective September 1, 2011:
(1) Section 51.216, Education Code;
(2) Subsections (b) and (c), Section 51.403, Education
Code;
(3) Section 51.4033, Education Code;
(4) Section 61.0815, Education Code;
(5) Section 61.086, Education Code;
(6) Subsection (c), Section 61.087, Education Code;
(7) Section 61.9685, Education Code;
(8) Section 1434.054, Government Code;
(9) Section 2056.011, Government Code;
(10) Section 2107.005, Government Code;
(11) Subsection (c), Section 412.042, Labor Code; and
(12) Subsection (c), Section 3.01, Chapter 670, Acts
of the 72nd Legislature, Regular Session, 1991 (Article 4477-7j,
Vernon’s Texas Civil Statutes).
(b) The following provisions of the Education Code are
repealed effective September 1, 2013:
(1) Section 51.859;
(2) Subsection (e), Section 51.917;
(3) Subsection (d), Section 51.968;
(4) Subsection (h), Section 54.203;
(5) Subsection (c), Section 56.034;
(6) Subsection (j), Section 56.079;
(7) Section 61.0582;
(8) Subsection (c), Section 61.066;
(9) Subsection (d), Section 63.003;
(10) Section 63.004;
(11) Section 63.103;
(12) Subsection (m), Section 86.52;
(13) Section 88.210;
(14) Section 106.54;
(15) Section 142.005;
(16) Section 143.006;
(17) Section 147.005;
(18) Section 148.005; and
(19) Section 153.008.
SECTION 9.02. The following are repealed:
(1) Subchapters D, F, G, and H, Chapter 86, Education
Code; and
(2) Subchapter I, Chapter 87, Education Code.
SECTION 9.03. (a) This section governs a conflict between
this Act and any other Act of the 82nd Legislature, Regular Session,
2011, without regard to the relative dates of enactment.
(b) If this Act and any other Act repeal the same statute,
the earlier effective date of repeal controls.
(c) If this Act amends a statute that any other Act repeals,
the repeal controls.
ARTICLE 10. EFFECTIVE DATE
SECTION 10.01. 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, 2011.

______________________________ ______________________________
President of the Senate               Speaker of the House

I hereby certify that S.B. No. 5 passed the Senate on
May 10, 2011, by the following vote: Yeas 30, Nays 1; and that the
Senate concurred in House amendments on May 27, 2011, by the
following vote: Yeas 31, Nays 0.

______________________________
Secretary of the Senate

I hereby certify that S.B. No. 5 passed the House, with
amendments, on May 19, 2011, by the following vote: Yeas 136,
Nays 0, one present not voting.

______________________________
Chief Clerk of the House

Approved:

______________________________
Date

______________________________
Governor