H.B. No. 3736

	AN ACT
	relating to conflicts of interest by members of state agency
	governing boards and governing officers and the contents and
	amendment of financial statements filed by certain persons;
	creating a criminal offense.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 572.023, Government Code, is amended by
	amending Subsections (a) and (b) and adding Subsection (e) to read
	as follows:
	(a)  A financial statement must include an account of the
	financial activity for the preceding calendar year of:
	(1)  any property characterized as separate property
	under Section 3.001, Family Code, of the individual required by
	this subchapter to file a financial statement;
	(2)  any community property of which the individual
	required by this subchapter to file a financial statement has sole
	management, control, and disposition as provided by Section
	3.102(a), Family Code;
	(3)  any community property of the individual required
	by this subchapter to file a financial statement, if the individual
	exercised both factual and legal control over the activity; and
	(4)  [an account of the financial activity of] the
	individual's [spouse and] dependent children if the individual
	exercised or held the right to exercise any degree of legal or
	factual [had actual] control over that activity [for the preceding
	calendar year].
	(b)  The account of financial activity consists of:
	(1)  a list of all sources of occupational income,
	identified by employer, or if self-employed, by the nature of the
	occupation, including identification of a person or other
	organization from which the individual or a business in which the
	individual has a substantial interest received a fee as a retainer
	for a claim on future services in case of need, as distinguished
	from a fee for services on a matter specified at the time of
	contracting for or receiving the fee, if professional or
	occupational services are not actually performed during the
	reporting period equal to or in excess of the amount of the
	retainer, and the category of the amount of the fee;
	(2)  identification by name and the category of the
	number of shares of stock of any business entity held or acquired,
	and if sold, the category of the amount of net gain or loss realized
	from the sale;
	(3)  a list of all bonds, notes, and other commercial
	paper held or acquired, and if sold, the category of the amount of
	net gain or loss realized from the sale;
	(4)  identification of each source and the category of
	the amount of income in excess of $500 derived from each source from
	interest, dividends, royalties, and rents;
	(5)  identification of each guarantor of a loan and
	identification of each person or financial institution to whom a
	personal note or notes or lease agreement for a total financial
	liability in excess of $1,000 existed at any time during the year
	and the category of the amount of the liability;
	(6)  identification by description of all beneficial
	interests in real property and business entities held or acquired,
	and if sold, the category of the amount of the net gain or loss
	realized from the sale;
	(7)  identification of a person or other organization
	from which the individual or the individual's spouse or dependent
	children received a gift of anything of value in excess of $250 and
	a description of each gift, except:
	(A)  a gift received from an individual related to
	the individual at any time within the second degree by
	consanguinity or affinity, as determined under Subchapter B,
	Chapter 573;
	(B)  a political contribution that was reported as
	required by Chapter 254, Election Code; and
	(C)  an expenditure required to be reported by a
	person required to be registered under Chapter 305;
	(8)  identification of the source and the category of
	the amount of all income received as beneficiary of a trust, other
	than a blind trust that complies with Subsection (c), and
	identification of each trust asset, if known to the beneficiary,
	from which income was received by the beneficiary in excess of $500;
	(9)  identification by description and the category of
	the amount of all assets and liabilities of a corporation, firm,
	partnership, limited partnership, limited liability partnership,
	professional corporation, professional association, joint venture,
	or other business association in which 50 percent or more of the
	outstanding ownership was held, acquired, or sold;
	(10)  a list of all boards of directors of which the
	individual is a member and executive positions that the individual
	holds in corporations, firms, partnerships, limited partnerships,
	limited liability partnerships, professional corporations,
	professional associations, joint ventures, or other business
	associations or proprietorships, stating the name of each
	corporation, firm, partnership, limited partnership, limited
	liability partnership, professional corporation, professional
	association, joint venture, or other business association or
	proprietorship and the position held;
	(11)  identification of any person providing
	transportation, meals, or lodging expenses permitted under Section
	36.07(b), Penal Code, and the amount of those expenses, other than
	expenditures required to be reported under Chapter 305;
	(12)  any corporation, firm, partnership, limited
	partnership, limited liability partnership, professional
	corporation, professional association, joint venture, or other
	business association, excluding a publicly held corporation, in
	which both the individual and a person registered under Chapter 305
	have an interest;
	(13)  identification by name and the category of the
	number of shares of any mutual fund held or acquired, and if sold,
	the category of the amount of net gain or loss realized from the
	sale; [and]
	(14)  identification of each blind trust that complies
	with Subsection (c), including:
	(A)  the category of the fair market value of the
	trust;
	(B)  the date the trust was created;
	(C)  the name and address of the trustee; and
	(D)  a statement signed by the trustee, under
	penalty of perjury, stating that:
	(i)  the trustee has not revealed any
	information to the individual, except information that may be
	disclosed under Subdivision (8); and
	(ii)  to the best of the trustee's knowledge,
	the trust complies with this section;
	(15)  if the aggregate cost of goods or services sold
	under one or more written contracts described by this subdivision
	exceeds $10,000 in the year covered by the report, identification
	of each written contract, including the name of each party to the
	contract:
	(A)  for the sale of:
	(i)  goods in the amount of $2,500 or more;
	or
	(ii)  services, including professional
	services as defined by Section 2254.002, consulting services as
	defined by Section 2254.021, or legal counsel, in the amount of
	$5,000 or more;
	(B)  to which the individual or any business
	entity of which the individual has at least a 50 percent ownership
	interest is a party; and
	(C)  with:
	(i)  a governmental entity; or
	(ii)  a person who contracts with a
	governmental entity, to fulfill one or more of the person's
	obligations to the governmental entity under that contract;
	(16)  if the individual is a member of the legislature
	and provides bond counsel services to an issuer, as defined by
	Section 1201.002(1), identification of the following for each
	issuance for which the individual served as bond counsel:
	(A)  the amount of the issuance;
	(B)  the name of the issuer;
	(C)  the date of the issuance;
	(D)  the amount of fees paid to the individual,
	and whether the amount is:
	(i)  less than $5,000;
	(ii)  at least $5,000 but less than $10,000;
	(iii)  at least $10,000 but less than
	$25,000; or
	(iv)  $25,000 or more; and
	(E)  the amount of fees paid to the individual's
	firm, if applicable, and whether the amount is:
	(i)  less than $5,000;
	(ii)  at least $5,000 but less than $10,000;
	(iii)  at least $10,000 but less than
	$25,000; or
	(iv)  $25,000 or more; and
	(17)  identification of any other source of earned or
	unearned income not reported under another provision of this
	subsection, including public benefits or a pension, individual
	retirement account, or other retirement plan, and the category of
	the amount of income derived from each source.
	(e)  In this section, "governmental entity" means the state,
	a political subdivision of the state, or an agency or department of
	the state or a political subdivision of the state.
	SECTION 2.  Subchapter B, Chapter 572, Government Code, is
	amended by adding Section 572.0295 to read as follows:
	Sec. 572.0295.  AMENDMENT OF STATEMENT. (a) A person who
	files a financial statement under this chapter may amend the
	statement.
	(b)  A financial statement that is amended before the eighth
	day after the date the original statement was filed is considered to
	have been filed on the date on which the original statement was
	filed.
	SECTION 3.  Subtitle B, Title 5, Government Code, is amended
	by adding Chapter 576 to read as follows:
	CHAPTER 576.  CONFLICT OF INTEREST BY STATE AGENCY GOVERNING BOARD
	MEMBER OR OFFICER
	Sec. 576.001.  DEFINITIONS.  In this chapter:
	(1)  "Conflict of interest" means the conflict between
	an official decision made by a state agency governing board member
	or governing officer in the individual's official capacity and the
	individual's private financial interest in which the individual
	realizes any pecuniary gain, if the pecuniary gain accrued to the
	individual as a member of a class of persons, including an
	occupation, profession, or industry, to a greater extent than any
	other member of the class.
	(2)  "Financial interest" means ownership or control,
	directly or indirectly, of an ownership interest of at least five
	percent in a person, including the right to share in profits,
	proceeds, or capital gains, or an ownership interest that an
	individual could reasonably foresee could result in any financial
	benefit to the individual. The term does not include an interest in
	a retirement plan, a blind trust, insurance coverage, or capital
	gains.
	(3)  "Rule" means all or part of a statement of a state
	agency that is of general or particular applicability and of future
	effect designed to implement, interpret, or prescribe law or policy
	for the state agency or to describe the organization, procedure, or
	practice requirements of the state agency.
	(4)  "State agency" means a board, commission, council,
	committee, department, office, agency, or other governmental
	entity in the executive branch of state government.
	Sec. 576.002.  DUTY TO DISCLOSE AND REFRAIN FROM
	PARTICIPATION.  (a)  Except as provided by Subsection (b) or (c), in
	each matter before the governing board of a state agency or, if the
	agency is not governed by a multimember governing board, the
	officer who governs the agency, for which a member of the board or
	officer, as applicable, has a conflict of interest, the individual:
	(1)  shall disclose in writing the conflict of interest
	to the agency; and
	(2)  may not participate in the decision on the matter.
	(b)  If a majority of the members of the governing board of a
	state agency has a conflict of interest related to a matter before
	the board or, if the agency is not governed by a multimember
	governing board, the officer who governs the agency has a conflict
	of interest on the matter, the board or officer may decide the
	matter only if:
	(1)  each member, or the officer, as applicable, who
	has a conflict of interest discloses in writing the conflict of
	interest to the agency; and
	(2)  the board, or officer, as applicable, makes a
	finding that an emergency exists that requires a decision on the
	matter despite the conflict of interest.
	(c)  The duty to disclose a conflict of interest and refrain
	from participation in the decision on a matter for a member of the
	governing board of an institution of higher education, as those
	terms are defined by Section 61.003, Education Code, is governed by
	Section 51.923, Education Code.
	Sec. 576.003.  PUBLIC INFORMATION.  A written disclosure
	made under Section 576.002 is public information.
	Sec. 576.004.  REPORT TO TEXAS ETHICS COMMISSION; RULES.
	(a)  A state agency that receives a written disclosure under Section
	576.002 shall file a copy of the disclosure with the Texas Ethics
	Commission.
	(b)  The Texas Ethics Commission may adopt the rules
	necessary to implement this chapter, including rules on the
	disclosure to be filed with the commission under Subsection (a).
	Sec. 576.005.  CRIMINAL PENALTY.  (a)  An individual commits
	an offense if the individual knowingly fails to comply with Section
	576.002.
	(b)  An offense under this section is a Class B misdemeanor.
	Sec. 576.006.  EXEMPTION. This chapter does not apply to:
	(1)  the consideration of a proposed rule; or
	(2)  a vote to adopt a proposed rule.
	SECTION 4.  Section 571.061(a), Government Code, is amended
	to read as follows:
	(a)  The commission shall administer and enforce:
	(1)  Chapters 302, 303, 305, 572, 576, and 2004;
	(2)  Subchapter C, Chapter 159, Local Government Code,
	in connection with a county judicial officer, as defined by Section
	159.051, Local Government Code, who elects to file a financial
	statement with the commission;
	(3)  Title 15, Election Code; and
	(4)  Sections 2152.064 and 2155.003.
	SECTION 5.  The changes in law made by this Act apply only to
	a financial statement filed under Subchapter B, Chapter 572,
	Government Code, as amended by this Act, on or after September 1,
	2015. A financial statement filed before September 1, 2015, is
	governed by the law in effect on the date of filing, and the former
	law is continued in effect for that purpose.
	SECTION 6.  This Act takes effect September 1, 2015.
	______________________________	______________________________
	President of the Senate	Speaker of the House
	I certify that H.B. No. 3736 was passed by the House on May
	11, 2015, by the following vote:  Yeas 135, Nays 0, 2 present, not
	voting; that the House refused to concur in Senate amendments to
	H.B. No. 3736 on May 28, 2015, and requested the appointment of a
	conference committee to consider the differences between the two
	houses; and that the House adopted the conference committee report
	on H.B. No. 3736 on May 31, 2015, by the following vote:  Yeas 141,
	Nays 0, 2 present, not voting.
	______________________________
	Chief Clerk of the House
	I certify that H.B. No. 3736 was passed by the Senate, with
	amendments, on May 26, 2015, by the following vote:  Yeas 31, Nays
	0; at the request of the House, the Senate appointed a conference
	committee to consider the differences between the two houses; and
	that the Senate adopted the conference committee report on H.B. No.
	3736 on May 31, 2015, by the following vote:  Yeas 28, Nays 3.
	______________________________
	Secretary of the Senate
	APPROVED: __________________
	Date
	__________________
	Governor