HBA-KMH, KMH C.S.H.B. 3226 76(R)BILL ANALYSIS Office of House Bill AnalysisC.S.H.B. 3226 By: Capelo Higher Education 4/12/1999 Committee Report (Substituted) BACKGROUND AND PURPOSE Current law defines "surplus property" in Section 2175.001(4), Government Code, as new or used property that retains some usefulness for the purpose for which it was intended or some other purpose and exceeds a state agency's current and foreseeable needs. The 75th Legislature amended the Government Code to direct legislative agencies to dispose of their surplus property first to public schools, then to government agencies, and finally to certain nonprofit assistance organizations. The Texas Performance Review recommended that this approach to surplus property disposal be considered for institutions of higher education. Since colleges and universities can dispose of their surplus property on their own, such property is not always made available to other public entities that need it such as public school districts. The state comptroller's December, 1998, performance review states that in fiscal 1997, institutions of higher education and legislative agencies reported nearly 15,000 surplus items, with an original value of more than $44 million. These items included more than 11,500 computers and printers, more than 2,700 pieces of laboratory equipment, and nearly 200 items of instructional equipment, all of which could be used by the public school districts. Many colleges and universities have surplus equipment that is no longer state of the art but could be useful to school districts. At present, there is no effective mechanism to match the needs of schools with the surplus equipment of colleges and universities. C.S.H.B. 3226 requires a university system or an institution or agency of higher education to dispose of its surplus or salvage property by giving preference to the transfer of property directly to a public school or school district before disposing of the property in another manner. This bill also requires the Texas Higher Education Coordinating Board to establish and maintain an Internet site, or similar facility accessible to school districts by telecommunication, to allow an institution of higher education to provide notice to school districts in this state of any available surplus or salvage property of the university system or institution or agency that consists of materials that could be used for instructional purposes. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 2175.302, Government Code, as follows: Sec. 2175.302. New Title: EXCEPTION FOR ELEEMOSYNARY INSTITUTIONS. Withdraws prohibition against application of the this chapter to an institution or agency of higher education. Deletes "and institutions and agencies of higher education" from the title. SECTION 2. Amends Subchapter F, Chapter 2175, Government Code, by adding Section 2175.304, as follows: Sec. 2175.304. EXCEPTION FOR INSTITUTIONS OF HIGHER EDUCATION. (a) Makes this chapter inapplicable to the disposition of surplus or salvage property of a university system or institution or agency of higher education, except as provided by this section. (b) Requires the governing board of each university system or institution or agency of higher education, included within the definition of "state agency" under Section 2151.002 (Definitions), to establish written procedures for the disposition of surplus or salvage property of the school. Requires the procedures to allow for the direct transfer of materials or equipment that can be used for instructional purposes to a public school or school district at a price or as the school deems appropriate. (c) Provides that the procedures established under Subsection (b) must give preference to transferring the property directly to a public school or school district before disposing of the property in another manner, if the property may be used for instructional purposes. Requires that a preference is given to public schools considered low-performing by the commissioner of education or to a school district entitled to receive an allotment of state funds under Subchapter F (Guaranteed Yield Program), Chapter 42, Education Code. SECTION 3. Amends Subchapter C, Chapter 61, Education Code, by adding Section 61.085, as follows: Sec. 61.085. ON-LINE SURPLUS PROPERTY RESOURCE. Requires the Texas Higher Education Coordinating Board (board) to establish and maintain an Internet site or similar facility accessible to school districts by telecommunication to allow an institution of higher education to provide notice to school districts in this state of any available surplus or salvage property of the institution that consists of materials that could be used for instructional purposes. Requires the board to operate the facility to allow a school district to make a direct inquiry to an institution regarding the possible acquisition of property by the school district. Authorizes the board to charge a fee for an institution or school district to use the facility. SECTION 4. Effective date: September 1, 1999. SECTION 5. Emergency clause. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.H.B. 3226 modifies the original in SECTION 2 (proposed Section 2175.304) by deleting proposed Subsection (b), of the original, adding a new Subsection (b), and modifying proposed Subsections (a) and (c), of the original. Subsection (b) of the original required an institution of higher education to dispose of surplus or salvage property under procedures established by the institution. C.S.H.B. 3226 modifies the original in SECTION 2 (proposed Section 2175.304(a)) by including a university system and an agency of higher education among the entities affected by the provisions of this chapter. The substitute modifies the original by subjecting proposed Subsection (a) to the provisions of this section. C.S.H.B. 3226 modifies the original in SECTION 2 (proposed Section 2175.304(b)) by requiring the governing board of each university system or institution or agency of higher education, included within the definition of "state agency" under Section 2151.002, to establish written procedures for the disposition of surplus or salvage property of the school. Furthermore, the substitute modifies the original in Subsection (b) by requiring the procedures to allow for the direct transfer of materials or equipment that can be used for instructional purposes to a public school or school district at a price or as the school deems appropriate. C.S.H.B. 3226 modifies the original in SECTION 3 by adding Section 61.085, rather than 61.084. (Same title and text)