Bill Text: TX HB2760 | 2023-2024 | 88th Legislature | Introduced

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Bill Title: Relating to the disclosure of certain gifts, grants, contracts, and financial interests received from a foreign source by certain state agencies, public institutions of higher education, and state contractors, and to the approval and monitoring of employment-related foreign travel and activities by certain public institution of higher education employees; providing civil and administrative penalties.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2023-03-13 - Referred to State Affairs [HB2760 Detail]

Download: Texas-2023-HB2760-Introduced.html

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88R750 RDS/CXP-D
By: Hefner H.B. No. 2760

A BILL TO BE ENTITLED
AN ACT
relating to the disclosure of certain gifts, grants, contracts, and
financial interests received from a foreign source by certain state
agencies, public institutions of higher education, and state
contractors, and to the approval and monitoring of
employment-related foreign travel and activities by certain public
institution of higher education employees; providing civil and
administrative penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 7, Government Code, is amended by adding
Chapters 794 and 795 to read as follows:
CHAPTER 794. DISCLOSURE OF CERTAIN GIFTS, GRANTS, CONTRACTS, AND
INTERESTS WITH FOREIGN SOURCES
Sec. 794.001. DEFINITIONS. In this chapter:
(1) "Foreign country of concern" means:
(A) the People's Republic of China;
(B) the Russian Federation;
(C) the Islamic Republic of Iran;
(D) the Democratic People's Republic of Korea;
(E) the Venezuelan regime under Nicolas Maduro;
(F) the Syrian Arab Republic; or
(G) an agency or entity under the significant
control of a country described by this subdivision.
(2) "Foreign source" means:
(A) a foreign government or agency of a foreign
government;
(B) a legal entity created solely under the laws
of a foreign government or an affiliate or subsidiary acting on
behalf of the legal entity;
(C) an individual who is not a citizen or
national of the United States, including a territory or
protectorate of the United States; or
(D) an agent acting on behalf of an individual or
entity described by Paragraph (A), (B), or (C).
(3) "Interest" means any direct or indirect:
(A) investment in or loan extended to an entity
that constitutes at least five percent of the entity's net worth; or
(B) control over an entity at a level exerting
similar or greater influence on the decision making or governance
of the entity as an investment described by Paragraph (A).
(4) "State agency" means:
(A) a board, commission, department, office, or
other agency in the executive branch of state government that was
created by the constitution or a statute of this state, including an
institution of higher education as defined by Section 61.003,
Education Code; or
(B) the legislature or a legislative agency.
Sec. 794.002. DATABASE OF FOREIGN SOURCE GIFTS, GRANTS,
CONTRACTS, AND INTERESTS. (a) The comptroller, in consultation
with the Department of Information Resources, shall establish and
maintain a database containing the disclosures submitted to the
comptroller under this chapter and make the disclosures available
to the public on an Internet website.
(b) The comptroller and Department of Information Resources
shall ensure that all disclosures submitted to the comptroller
under this chapter are easily accessible through the comptroller's
purchasing system.
Sec. 794.003. REQUIRED DISCLOSURE OF CERTAIN GIFTS AND
GRANTS RECEIVED BY STATE AGENCY. (a) A state agency that receives,
directly or indirectly from a foreign source, a gift or grant with a
value of at least $50,000 shall disclose the gift or grant to the
comptroller not later than the 30th day after the date the gift or
grant is received.
(b) A disclosure under this section must include the:
(1) date the state agency received the gift or grant;
(2) amount of the gift or grant;
(3) foreign source's name; and
(4) foreign source's country of residence or domicile.
Sec. 794.004. REQUIRED DISCLOSURES BY CONTRACTORS,
PROSPECTIVE CONTRACTORS, AND GRANT APPLICANTS. (a) This section
applies only to a grant or contract awarded by a state agency that
has a value of at least $100,000 paid wholly or partly from public
funds of the state agency.
(b) This section does not apply to a grant application or
contract proposal submitted by:
(1) a public or nonprofit research institution in
connection with research funded by a federal agency;
(2) a state agency required to disclose gifts and
grants from foreign sources under Section 794.003 or another law of
this state; or
(3) a foreign source, if award of the grant or contract
to the foreign source would require disclosure under Section
794.003 or another law of this state.
(c) A person who submits an application or proposal for a
grant or contract to which this section applies shall disclose to
the state agency and the comptroller any:
(1) current or former interest in the person held by a
foreign country of concern with a value of at least $50,000;
(2) contract between the person and a foreign country
of concern with a value of at least $50,000 that was entered into or
in effect at any time during the five years preceding the date the
person submits the grant application or contract proposal; or
(3) gift or grant with a value of at least $50,000
received by the person from a foreign country of concern during the
five years preceding the date the person submits the grant
application or contract proposal.
(d) A disclosure under this section must:
(1) be submitted with the grant application or
contract proposal or have been submitted not more than one year
before the date the grant application or contract proposal is
submitted;
(2) be updated at least monthly while the grant
application or contract proposal is pending; and
(3) include:
(A) the name and mailing address of the person
making the disclosure;
(B) the value of the interest, contract, gift, or
grant being disclosed;
(C) the foreign country of concern;
(D) the date the interest was acquired, the
contract was entered into, or the gift or grant was received, as
applicable;
(E) the date the contract or interest was
terminated, if applicable; and
(F) the name of an agent of the foreign country of
concern if the agent was the source of the interest, contract, gift,
or grant.
(e) A person who is a party to an existing grant or contract
to which this section applies shall disclose to the state agency and
the comptroller:
(1) the information required by Subsection (d) not
later than the 30th day after the date:
(A) a foreign country of concern acquires an
interest in the person with a value of at least $50,000;
(B) the person enters into a contract with a
foreign country of concern with a value of at least $50,000; or
(C) the person receives a gift or grant from a
foreign country of concern with a value of at least $50,000; and
(2) a sanction, embargo, or other trade restriction
not later than the 30th day after the date the information is
discovered as a result of screening conducted under Section
794.005.
Sec. 794.005. SCREENING OF CERTAIN CONTRACTORS. (a) At
least once every five years, the comptroller shall screen each
vendor who participates in an online procurement system maintained
by the comptroller or another state agency and has the ability to
fulfill an order with a value of at least $100,000 to determine
whether the person is subject, under federal law, to any:
(1) trade sanction;
(2) embargo; or
(3) other trade restriction.
(b) The comptroller shall request the assistance of federal
agencies responsible for identifying persons and organizations
that are subject to the trade restrictions described by Subsection
(a).
(c) A person whom the comptroller identifies as being
subject to a trade restriction described by Subsection (a) shall
make a disclosure under Section 794.004.
(d) The comptroller shall notify a person who is found to be
subject to a trade restriction under Subsection (a) that the person
must make a disclosure under Subsection (c) and shall indicate on
the online procurement system that the vendor has been found to be
subject to a trade restriction.
(e) The comptroller shall ensure that disclosures made
under this section are easily accessible by state agencies using an
online procurement system.
Sec. 794.006. INVESTIGATION. (a) The comptroller shall
investigate an alleged violation of this chapter upon receiving a
complaint from an inspector general or other compliance officer of
a state agency or political subdivision or any sworn complaint
based on substantive information and reasonable belief. The office
of the attorney general shall assist with the investigation at the
comptroller's request.
(b) The comptroller, the attorney general, or an agent or
compliance officer authorized by a state agency or political
subdivision may request records relevant to a reasonable suspicion
of a violation of this chapter. A person who receives a request
under this subsection must produce the records not later than the
30th day after the date the person receives the request, unless the
parties to the request agree to a later date.
Sec. 794.007. ENFORCEMENT; CIVIL PENALTY FOR VIOLATION.
(a) A state agency that fails to provide a disclosure under Section
794.003 is liable to this state for a civil penalty in the amount of
$5,000 for the first violation and $10,000 for each subsequent
violation.
(b) A person who fails to provide a disclosure under Section
794.004 or fails to provide a record requested under Section
794.006 is liable to this state for a civil penalty in the amount of
$5,000 for the first violation and $10,000 for each subsequent
violation.
(c) If it is shown that a state agency has committed at least
two previous violations of this chapter, the final order
determining the third or subsequent violation must:
(1) identify the state officer or employee responsible
for acceptance of the undisclosed grant or gift; and
(2) refer the violation to the governor, the speaker
of the house of representatives, and the lieutenant governor to
consider removing the state officer from office or terminating the
state employee, as applicable.
(d) Except as provided by this section, a state agency may
not accept a contract proposal from or award a contract or grant to
a person if it is shown that the person has committed at least three
violations of this chapter. A state agency may accept a contract
proposal from or award a contract or grant to a person with the
approval of the comptroller.
(e) The attorney general may sue to collect the civil
penalty under this section.
(f) A suit or petition under this section may be filed in a
district court in Travis County.
Sec. 794.008. RULES. (a) The comptroller and Department of
Information Resources shall adopt rules necessary to carry out this
chapter.
(b) Rules adopted under this section may identify federal
agencies to be consulted under Section 794.005 and the procedure
for notifying a vendor of the disclosure requirement under this
chapter.
CHAPTER 795. CERTAIN INTERNATIONAL CULTURAL AGREEMENTS PROHIBITED
Sec. 795.001. DEFINITIONS. In this chapter:
(1) "Foreign country of concern" has the meaning
assigned by Section 794.001.
(2) "Governmental entity" has the meaning assigned by
Section 2251.001.
Sec. 795.002. CERTAIN INTERNATIONAL CULTURAL AGREEMENTS
PROHIBITED. (a) A governmental entity authorized to spend state
appropriations or impose an ad valorem tax may not participate in an
agreement with or accept a grant from a foreign country of concern
that:
(1) constrains the governmental entity's freedom of
contract;
(2) allows the curriculum or values of any program in
this state to be directed or controlled by the foreign country of
concern; or
(3) promotes an agenda detrimental to the safety or
security of the United States or its residents.
(b) Before entering into a cultural exchange agreement with
a foreign country of concern, including an agreement that relates
to the exchange of ideas, traditions, or knowledge, the
governmental entity shall review the agreement and determine
whether the agreement promotes an agenda detrimental to the safety
or security of the United States or its residents.
(c) A governmental entity shall request the assistance of
appropriate federal agencies, including agencies responsible for
national security or the enforcement of trade sanctions, embargoes,
or other trade restrictions, in reviewing an agreement and making a
determination under Subsection (b).
(d) A governmental entity may not enter into an agreement if
a federal agency consulted under Subsection (c) determines that the
agreement promotes an agenda that would be detrimental to the
safety or security of the United States or its residents.
Sec. 795.003. CONDITIONAL PARTICIPATION IN INTERNATIONAL
CULTURAL AGREEMENT PROHIBITED. A governmental entity may not
accept money, a financial benefit, or other consideration from a
foreign country of concern that is conditioned on participating in
a program or other endeavor to promote the language or culture of
the foreign country of concern.
SECTION 2. Subtitle A, Title 3, Education Code, is amended
by adding Chapter 51B to read as follows:
CHAPTER 51B. FOREIGN GIFTS AND TRAVEL
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 51B.001. DEFINITIONS. In this chapter:
(1) "Coordinating board" means the Texas Higher
Education Coordinating Board.
(2) "Foreign country of concern" has the meaning
assigned by Section 794.001, Government Code.
(3) "Foreign government" means the government or an
agent of the government of any country, nation, or group of nations,
or any province or other political subdivision of any country or
nation, other than the United States government or the government
of a state or political subdivision of the United States.
(4) "Foreign source" has the meaning assigned by
Section 794.001, Government Code.
(5) "Governing board," "institution of higher
education," and "university system" have the meanings assigned by
Section 61.003.
Sec. 51B.002. RULES. The coordinating board shall adopt
rules as necessary to implement this chapter.
SUBCHAPTER B. FOREIGN GIFT REPORTING AND REQUIREMENTS
Sec. 51B.051. FOREIGN GIFT AGREEMENT REQUIRED. (a) An
institution of higher education that accepts a gift directly or
indirectly from a foreign source shall enter into a written gift
agreement with the foreign source regarding the gift.
(b) A gift agreement required under Subsection (a) must:
(1) be signed by the foreign source and the chief
administrative officer of the institution of higher education or
the officer's designee; and
(2) include:
(A) a detailed description of the purpose for
which the institution will use the gift;
(B) an identification of the persons the gift is
explicitly intended to benefit; and
(C) any applicable condition, requirement,
restriction, or term made a part of the gift regarding the control
of curricula, faculty, student admission, or student fees or
constraints placed on the institution to take a specific public
position or to award an honorary degree.
Sec. 51B.052. FOREIGN GIFT REPORTING REQUIRED. (a) Twice
each year on dates designated by the coordinating board, each
institution of higher education shall compile and submit as
provided by Subsection (c) a report of each gift the institution
receives directly or indirectly from a foreign source during the
fiscal year in which the report is made that:
(1) has a value of $50,000 or more; or
(2) is received from a foreign source that provides
more than one gift to the institution during that fiscal year and
the total value of those gifts is $50,000 or more.
(b) For purposes of this section, a gift received from a
foreign source through an intermediary is considered an indirect
gift.
(c) An institution of higher education shall submit a report
required under this section to the institution's governing board
and the coordinating board. Institutions that are component
institutions of a university system may consolidate the
institutions' respective reports into a single report submitted to
the coordinating board.
Sec. 51B.053. CONTENTS OF FOREIGN GIFT REPORT. (a) For
each gift required to be reported under Section 51B.052, an
institution of higher education must include in the report the
following information, unless the disclosure of that information is
prohibited or the information is confidential under federal or
state law:
(1) the amount of the gift;
(2) the date the gift was received;
(3) the name of the foreign source and, if not a
foreign government, the country of citizenship, if known, and the
country of principal residence or domicile of the foreign source;
and
(4) a copy of a gift agreement required under Section
51B.051.
(b) Information reported under this section is not
confidential except as otherwise provided by state law or unless
protected by federal or state law as a trade secret.
Sec. 51B.054. FOREIGN GIFT REPORTING AUDIT. Using existing
resources, the coordinating board shall annually conduct random
inspections or audits of at least five percent of the total number
of gifts or gift agreements reported under Section 51B.052 during
the preceding fiscal year to determine an institution of higher
education's compliance with the requirements of this subchapter.
Sec. 51B.055. ENFORCEMENT. (a) If the coordinating board
determines that an institution of higher education negligently
fails to disclose the information required by this subchapter, the
coordinating board may assess an administrative penalty against the
institution in an amount equal to 105 percent of the value of each
undisclosed gift.
(b) An institution of higher education may not pay an
administrative penalty assessed under this section using state or
federal money.
SUBCHAPTER C. FOREIGN TRAVEL: RESEARCH INSTITUTIONS
Sec. 51B.101. APPLICABILITY. This subchapter applies only
to an institution of higher education that has an annual research
budget of $10 million or more.
Sec. 51B.102. FOREIGN TRAVEL: RESEARCH INSTITUTIONS. (a)
Each institution of higher education to which this subchapter
applies shall establish a research integrity office to operate an
international travel approval and monitoring program at the
institution.
(b) The program must require, in addition to any other
travel approval process required by the institution of higher
education, preapproval from the institution's research integrity
office for any employment-related foreign travel or activities by a
faculty member, researcher, or research department staff member of
the institution.
(c) The research integrity office may preapprove travel or
activities under the program only if the applicant:
(1) reviews and acknowledges guidance published by the
institution of higher education that relates to countries under
sanctions or other restrictions by this state or the United States
government, including:
(A) federal license requirements;
(B) customs rules;
(C) export controls;
(D) restrictions on taking institution property,
including intellectual property, abroad;
(E) restrictions on presentation, teaching, and
interactions with foreign colleagues; and
(F) other subjects important to the research and
academic integrity of the institution; and
(2) agrees to comply with the institution's
limitations on travel and activities abroad and all applicable
federal laws.
Sec. 51B.103. MAINTENANCE OF RECORDS AND REPORT. (a) An
institution of higher education shall maintain for at least three
years, or any longer period of time required by applicable federal
or state law, records relating to employment-related foreign travel
or activities by a faculty member, researcher, or research staff
member of the institution, including:
(1) each foreign travel request and approval;
(2) expenses reimbursed by the institution for foreign
travel, including for travel, food, and lodging;
(3) payments and honoraria received during foreign
travel or activities, including for travel, food, and lodging;
(4) the purpose of each foreign travel; and
(5) any record related to the foreign activity review.
(b) Each institution of higher education shall annually
submit to the institution's governing board a report on
employment-related foreign travel and activities by a faculty
member, researcher, or research staff member of the institution to
foreign countries of concern. The report must list each traveler,
foreign location visited, and foreign institution visited.
SECTION 3. Section 794.004, Government Code, as added by
this Act, applies only to a grant application or contract proposal
submitted on or after the effective date of this Act, except as
otherwise provided by that section.
SECTION 4. Sections 795.002 and 795.003, Government Code,
as added by this Act, apply only to an agreement entered into on or
after the effective date of this Act.
SECTION 5. Not later than January 1, 2024, the comptroller
of public accounts and Department of Information Resources shall
create and make available to the public the Internet database
required by Section 794.002, Government Code, as added by this Act.
SECTION 6. Chapter 51B, Education Code, as added by this
Act, applies beginning July 1, 2024.
SECTION 7. Not later than April 1, 2024, the Texas Higher
Education Coordinating Board shall adopt the rules required by
Section 51B.002, Education Code, as added by this Act.
SECTION 8. This Act takes effect September 1, 2023.