84R18751 YDB-F
	By: Davis of Harris	H.B. No. 3736
	Substitute the following for H.B. No. 3736:
	By:  Hunter	C.S.H.B. No. 3736

	A BILL TO BE ENTITLED
	AN ACT
	relating to conflicts of interest by members of state agency
	governing boards and governing officers; creating a criminal
	offense.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  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.
	(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)  "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), 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.
	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.
	SECTION 2.  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 3.  This Act takes effect September 1, 2015.