84R17585 DDT-F
 
  By: Parker, Capriglione H.B. No. 2493
 
  Substitute the following for H.B. No. 2493:
 
  By:  Longoria C.S.H.B. No. 2493
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the self-directed and semi-independent status of the
  State Securities Board; authorizing fees.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  The Securities Act (Article 581-1 et seq.,
  Vernon's Texas Civil Statutes) is amended by adding Sections 44,
  45, 46, 47, 48, 49, 50, 51, and 52 to read as follows:
         Sec. 44.  SELF-DIRECTED AND SEMI-INDEPENDENT STATUS. A.
  Notwithstanding any other provision of law, the State Securities
  Board is self-directed and semi-independent as specified by this
  Act. Any Act of the 84th Legislature that relates to the Board and
  that is inconsistent with the agency being self-directed and
  semi-independent may be implemented by the Commissioner only on
  authorization by the members of the Board.
         B.  Except as otherwise provided by this Act, the State
  Securities Board is subject to a provision of law that applies to
  state agencies, including:
               (1)  state purchasing requirements under Subtitle D,
  Title 10, Government Code;
               (2)  interagency transfer voucher requirements under
  Section 2155.327, Government Code;
               (3)  travel requirements under Chapters 2171 and 2205,
  Government Code, using amounts provided by the General
  Appropriations Act to guide travel reimbursement rates; and
               (4)  prompt payment requirements under Chapter 2251,
  Government Code.
         Sec. 45.  BUDGET, REVENUES, AND EXPENSES. A. The
  Commissioner shall submit to the members of the Board an annual
  budget using generally accepted accounting principles.
  Notwithstanding any other provision of law, including the General
  Appropriations Act, the budget shall be adopted and approved only
  by the members of the Board.
         B.  The State Securities Board is responsible for all direct
  and indirect costs of the agency's existence and operation. The
  agency may not directly or indirectly cause the general revenue
  fund to incur any cost.
         C.  Subject to any limitations in this Act, the Board may set
  the amounts of the respective fees, penalties, charges, and
  revenues required or permitted by statute or rule as necessary to
  carry out the agency's functions and to fund the budget adopted and
  approved under Subsection A of this section.
         D.  Periodically, the Commissioner shall submit to the
  members of the Board, as directed by the Board members, a report of
  the receipts and expenditures of the agency.
         E.  The fiscal year for the agency begins on September 1 and
  ends on August 31.
         F.  All fees and funds collected by the agency under
  Subsection A, Section 35, of this Act and any funds appropriated to
  the agency shall be deposited in interest-bearing deposit accounts
  in the Texas Treasury Safekeeping Trust Company to be used
  exclusively to pay costs incurred by the agency in administering
  this Act. The comptroller shall contract with the agency for the
  maintenance of the deposit accounts under terms comparable to a
  contract between a commercial banking institution and the
  institution's customers. The agency may not hold funds in an
  account that is not under the control of the comptroller.
         G.  Except as provided by Subsection F of this section, all
  other money collected by the Commissioner or Board and any other
  funds belonging to or under the control of the Board shall be
  deposited into the general revenue fund.
         H.  If the Commissioner or Board determines that all or part
  of a registration fee should be refunded, the refund shall be made
  by warrant on the state treasury from the fund into which the
  registration fee was deposited.
         I.  The agency shall use the comptroller's uniform statewide
  accounting system under Chapter 2101, Government Code, to make all
  payments, other than direct payments from the agency's account to
  the Texas Treasury Safekeeping Trust Company.
         Sec. 46.  RECORDS; REPORTING REQUIREMENTS. A. The
  Commissioner shall keep financial and statistical information as
  necessary to disclose completely and accurately the financial
  condition and operations of the agency.
         B.  Before the beginning of each regular session of the
  legislature, the Commissioner shall submit to the legislature and
  the governor a report describing all of the agency's activities in
  the previous biennium. The report must include:
               (1)  an audit;
               (2)  a financial report of the two preceding fiscal
  years, including reports on financial condition and operations;
               (3)  a description of all changes in fees imposed on
  regulated persons;
               (4)  a report on changes in the regulatory jurisdiction
  of the Board; and
               (5)  a list of all new rules adopted or repealed.
         C.  In addition to the reporting requirements of Subsection B
  of this section, not later than November 1 of each year, the
  Commissioner shall submit to the governor, the committee of each
  house of the legislature that has jurisdiction over appropriations,
  and the Legislative Budget Board a report that contains:
               (1)  the salary for Board employees and the total
  amount of per diem expenses and travel expenses paid for all Board
  employees, including trend performance data for the preceding five
  fiscal years;
               (2)  the total amount of per diem expenses and travel
  expenses paid for each member of the Board, including trend
  performance data for the preceding five fiscal years;
               (3)  the agency's operating plan covering a period of
  two fiscal years and operating budget, including revenues and a
  breakdown of expenditures by program and administrative expenses,
  showing:
                     (a)  projected budget data for a period of two
  fiscal years; and
                     (b)  trend performance data for the preceding five
  fiscal years regarding:
                           (i)  the number of full-time equivalent
  positions at the agency;
                           (ii)  the number of complaints received from
  the public and the number of complaints initiated by Board
  employees;
                           (iii)  the number of complaints dismissed
  and the number of complaints resolved by enforcement action;
                           (iv)  the number of enforcement actions by
  sanction type;
                           (v)  the number of enforcement cases closed
  through voluntary compliance;
                           (vi)  the amount of administrative penalties
  assessed and the rate of collection of assessed administrative
  penalties;
                           (vii)  the number of enforcement cases that
  allege a threat to public health, safety, or welfare or a violation
  of professional standards of care and the disposition of those
  cases;
                           (viii)  the average time to resolve a
  complaint;
                           (ix)  the number of license holders or
  regulated persons broken down by type of license and license
  status, including inactive status or retired status;
                           (x)  the fee charged to issue and renew each
  type of license, certificate, permit, or other similar
  authorization issued by the Commissioner under this Act;
                           (xi)  the average time to issue a license;
                           (xii)  litigation costs, broken down by
  administrative hearings, judicial proceedings, and outside counsel
  costs; and
                           (xiii)  reserve fund balances; and
               (4)  a detailed report of all revenue received and all
  expenses incurred by the agency in the preceding 12 months.
         Sec. 47.  ABILITY TO CONTRACT. A. To carry out and promote
  the objectives of this Act, the Commissioner may enter into
  contracts and do all other acts incidental to those contracts that
  are necessary for the administration of the agency's affairs and
  for the attainment of the agency's purposes, except as limited by
  Subsection B of this section.
         B.  Any indebtedness, liability, or obligation of the agency
  incurred under this section may not:
               (1)  create a debt or other liability of this state or
  another entity other than the agency; or
               (2)  create any personal liability on the part of the
  members of the Board or the Board's employees.
         Sec. 48.  PROPERTY. The Commissioner, on behalf of the
  agency, may:
               (1)  acquire by purchase, lease, gift, or any other
  manner provided by law and maintain, use, and operate any real,
  personal, or mixed property, or any interest in property, necessary
  or convenient to the exercise of the powers, rights, privileges, or
  functions of the agency;
               (2)  sell or otherwise dispose of any real, personal,
  or mixed property, or any interest in property, that the
  Commissioner determines is not necessary or convenient to the
  exercise of the agency's powers, rights, privileges, or functions;
               (3)  construct, extend, improve, maintain, and
  reconstruct, or cause to construct, extend, improve, maintain, and
  reconstruct, and use and operate all facilities necessary or
  convenient to the exercise of the powers, rights, privileges, or
  functions of the agency; and
               (4)  borrow money, as may be authorized from time to
  time by an affirmative vote of a three-fifths majority of the Board,
  for a period not to exceed five years if necessary or convenient to
  the exercise of the agency's powers, rights, privileges, or
  functions.
         Sec. 49.  POST-PARTICIPATION LIABILITY. A. If the State
  Securities Board no longer has status under this Act as a
  self-directed semi-independent agency for any reason, the agency
  shall be liable for any expenses or debts incurred by the agency
  during the time the agency was a self-directed semi-independent
  agency. The agency's liability under this section includes
  liability for any lease entered into by the agency. This state is
  not liable for any expense or debt covered by this subsection, and
  money from the general revenue fund may not be used to repay the
  expense or debt.
         B.  If the Board no longer has status under this Act as a
  self-directed semi-independent agency for any reason, ownership of
  any property or other asset acquired by the agency during the time
  the agency was a self-directed semi-independent agency, including
  unexpended fees in a deposit account in the Texas Treasury
  Safekeeping Trust Company, shall be transferred to this state.
         Sec. 50.  DUE PROCESS; OPEN GOVERNMENT. The State Securities
  Board is:
               (1)  a governmental body for purposes of Chapters 551
  and 552, Government Code; and
               (2)  a state agency for purposes of Chapters 2001 and
  2005, Government Code.
         Sec. 51.  MEMBERSHIP IN EMPLOYEES RETIREMENT SYSTEM.
  Employees of the State Securities Board are members of the
  Employees Retirement System of Texas under Chapter 812, Government
  Code, and the Board's transition to independent status as provided
  by this Act has no effect on their membership or any benefits under
  that system.
         Sec. 52.  GIFTS. A. Notwithstanding any other law, the
  Commissioner may not accept a gift, grant, or donation on behalf of
  the agency:
               (1)  from a party to an enforcement action; or
               (2)  to pursue a specific investigation or enforcement
  action.
         B.  The Commissioner must:
               (1)  report each gift, grant, or donation that the
  agency receives as a separate item in the agency's report required
  under Subsection B, Section 46, of this Act; and
               (2)  include with the report a statement indicating the
  purpose for which each gift, grant, or donation was donated and
  used.
         SECTION 2.  Subsections D, G, K, and O, Section 2, The
  Securities Act (Article 581-2, Vernon's Texas Civil Statutes), are
  amended to read as follows:
         D.  Each member of the Board is entitled to reimbursement for
  travel expenses incurred [per diem as set by legislative
  appropriation] for each day that the member engages in the business
  of the Board.
         The Governor shall designate a member of the Board as the
  presiding officer of the Board to serve in that capacity at the will
  of the Governor. A majority of the members shall constitute a quorum
  for the transaction of any business.
         G.  The Board shall appoint a Securities Commissioner who
  serves at the pleasure of the Board and who shall, under the
  supervision of the Board, administer the provisions of this Act.
  The Board shall determine the Commissioner's salary. Each member of
  the Board shall have access to all offices and records under his
  supervision, and the Board, or a majority thereof, may exercise any
  power or perform any act authorized to the [Securities]
  Commissioner by the provisions of this Act.
         K.  The Commissioner shall determine the number of Board
  employees and the employees' salaries. The Commissioner or his
  designee shall develop an intraagency career ladder program, one
  part of which shall be the intraagency posting of all nonentry level
  positions for at least ten (10) days before any public posting. The
  Commissioner or his designee shall develop a system of annual
  performance evaluations based on measurable job tasks. All merit
  pay for Board employees must be based on the system established
  under this section.
         O.  The Sunset Advisory Commission shall examine the State
  Securities Board's performance as a self-directed and
  semi-independent agency as part of the commission's periodic review
  of the agency under [The State Securities Board is subject to]
  Chapter 325, Government Code (Texas Sunset Act).  The agency shall
  pay the cost incurred by the commission in performing a review of
  the agency. The commission shall determine the cost and submit to
  the agency a statement detailing the cost. The agency shall pay the
  amount promptly after receiving the statement. Unless continued in
  existence as provided by that chapter, the State Securities Board 
  [board] is abolished and this Act expires September 1, 2019.
         SECTION 3.  Subsection C, Section 2-3, The Securities Act
  (Article 581-2-3, Vernon's Texas Civil Statutes), is amended to
  read as follows:
         C.  A person appointed to the Board is entitled to
  reimbursement[, as provided by the General Appropriations Act,] for
  the travel expenses incurred in attending the training program
  regardless of whether the attendance at the program occurs before
  or after the person qualifies for office.
         SECTION 4.  Subsection A, Section 35, The Securities Act
  (Article 581-35, Vernon's Texas Civil Statutes), is amended to read
  as follows:
         A.  The Board shall establish the following fees to produce
  [in amounts so that the aggregate amount that exceeds the amount of
  the fees on September 1, 2002, produces] sufficient revenue to
  cover the costs of administering and enforcing this Act:
               (1)  for the filing of any original, amended, or
  renewal application to sell or dispose of securities[, an amount
  not to exceed $100];
               (2)  for the filing of any original application of a
  dealer or investment adviser or for the submission of a notice
  filing for a federal covered investment adviser[, an amount not to
  exceed $100];
               (3)  for the filing of any renewal application of a
  dealer or investment adviser or for the submission of a renewal
  notice filing for a federal covered investment adviser[, an amount
  not to exceed $100];
               (4)  for the filing of any original application for
  each agent, officer, or investment adviser representative or for
  the submission of a notice filing for each representative of a
  federal covered investment adviser[, an amount not to exceed $100];
  and
               (5)  for the filing of any renewal application for each
  agent, officer, or investment adviser representative or for the
  submission of a renewal notice filing for each representative of a
  federal covered investment adviser[, an amount not to exceed $100].
         SECTION 5.  The following provisions of The Securities Act
  (Article 581-l et seq., Vernon's Texas Civil Statutes) are
  repealed:
               (1)  Subsections J and N, Section 2;
               (2)  Subsections C and D, Section 35; and
               (3)  Section 36.
         SECTION 6.  Subject to Section 45, The Securities Act
  (Article 581-45, Vernon's Texas Civil Statutes), as added by this
  Act, the appropriations made by an Act of the 84th Legislature,
  Regular Session, 2015, may be spent by the State Securities Board as
  the Securities Commissioner directs. The board shall repay to the
  general revenue fund the appropriation made to the agency for the
  state fiscal year ending August 31, 2016, not later than that date
  and as funds become available. The board shall repay to the general
  revenue fund the appropriation made to the board for the state
  fiscal year ending August 31, 2017, not later than that date and as
  funds become available.
         SECTION 7.  The transfer of the State Securities Board to
  self-directed and semi-independent status under this Act, and the
  expiration of self-directed and semi-independent status may not act
  to cancel, suspend, or prevent:
               (1)  any debt owed to or by the State Securities Board;
               (2)  any fine, tax, penalty, or obligation of any
  party;
               (3)  any contract or other obligation of any party; or
               (4)  any action taken by the State Securities Board,
  the Securities Commissioner, or the board's employees in the
  administration or enforcement of the agency's duties.
         SECTION 8.  The State Securities Board shall continue to
  have and exercise the powers and duties allocated to the board in
  the board's enabling legislation, except as specifically amended by
  this Act.
         SECTION 9.  Title to or ownership of all supplies,
  materials, records, equipment, books, papers, and furniture used by
  the State Securities Board is transferred to the State Securities
  Board in fee simple. This Act does not affect any property owned by
  the State Securities Board on or before the effective date of this
  Act.
         SECTION 10.  Beginning September 1, 2015, the State
  Securities Board shall pay rent to this state in a reasonable amount
  to be determined by the Texas Facilities Commission for its use and
  occupancy of state-owned office space.
         SECTION 11.  This Act takes effect September 1, 2015.