HBA-TYH H.B. 3300 76(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 3300 By: Coleman State Affairs 4/28/1999 Committee Report (Amended) BACKGROUND AND PURPOSE The 75th Legislature passed legislation allowing the creation of sports and community venue districts financed by certain local taxes for the purpose of constructing sports and community venues such as stadiums, convention centers, and museums. If approved by the voters, these districts are given all powers necessary to plan and complete a venue project, including the power of eminent domain. H.B. 3300 limits the power of eminent domain of a venue district to only the actual physical site of the approved venue project. This bill also creates a code of conduct for board members and employees of certain venue districts. 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 Subchapter E, Chapter 335, Local Government Code, by adding Section 335.0711, as follows: Sec. 335.0711. LIMIT ON POWER OF EMINENT DOMAIN IN CERTAIN DISTRICTS. Defines "facility site." Provides that this section applies only to a district located in a county with a population of 2.4 million or more. Authorizes a district to use its power of eminent domain under Section 335.071 (General Powers of District) only to acquire a facility site as part of an approved venue project. Prohibits a district using its right and power of eminent domain for any other purpose. Prohibits a district from participating in any way in planning or zoning issues before the governing body of a municipality. SECTION 2. Amends Chapter 335, Local Government Code, by adding Subchapter F, as follows: SUBCHAPTER F. CODE OF CONDUCT FOR CERTAIN DISTRICTS Sec. 335.101. DEFINITIONS. Defines "director" and "employee." Sec. 335.102. APPLICABILITY OF SUBCHAPTER. Provides that this subchapter applies only to a district located in a county with a population of 2.4 million or more. Sec. 335.103. APPLICABILITY OF LAWS. Provides that Chapter 171 (Regulation of Conflicts of Interest of Officers of Municipalities, Counties, and Certain Other Local Governments) applies to an employee as if the employee was a local public official, as defined by Section 171.001 (Definitions). Provides that Chapter 553 (Public Disclosure), Government Code, applies to an employee as if the employee was a public servant, as defined by Section 553.001 (Definitions), Government Code. Provides that Chapter 573 (Degrees of Relationship; Nepotism Prohibitions), Government Code, applies to an employee as if the employee was a public official, as defined by Section 573.001 (Definitions), Government Code. Sec. 335.104. DISTRIBUTION OF CODE OF CONDUCT. Requires the presiding officer of the board of directors of a venue district (board) to provide to directors and employees, as often as necessary, a code of conduct regarding the requirements for office or employment, including the enumerated information. Sec. 335.105. RULEMAKING. Authorizes the board, by rule, to modify its code of conduct. Sec. 335.106. GENERAL DUTIES. Requires a director or employee to carry out the enumerated duties. Sec. 335.107. VENDOR REQUIREMENTS. (a) Provides that this section applies to a vendor who responds to a district request for a proposal or otherwise communicates with the district in connection with a potential agreement between that vendor and the district. (b) Requires the board, by rule, to design a conflict of interest questionnaire that requires disclosure of a vendor's affiliations or business relationships that might cause a conflict of interest. (c) Requires a vendor to file a completed conflict of interest questionnaire with the board secretary within seven days after the vendor performs the enumerated actions. (d) Prohibits the board from approving an agreement with a vendor unless the vendor's completed questionnaire has been on file with the board secretary for at least five days. (e) Requires a vendor to file an updated completed questionnaire with the board secretary at the enumerated dates. (f) Requires each contract entered into between a district and a vendor to contain a provision stating that the contract is void if the board or vendor violates this section. Sec. 335.108. DISCLOSURE OF VENDOR RELATIONSHIP BY DIRECTORS AND EMPLOYEES. (a) Requires the board, by rule, to design a conflicts disclosure statement for directors and employees that includes the enumerated items. (b) Provides that the disclosure requirement applies to a director or employee and a person related to that director or employee within the first degree by consanguinity or by affinity, as defined by Subchapter B (Relationships by Consanguinity or by Affinity), Chapter 573, Government Code. (c) Requires a director or employee to file a conflicts disclosure statement with the board secretary not later than the end of the first business day on which the director or employee became aware of the relationship between the district and the vendor if any of the enumerated conditions occur. (d) Authorizes the director, if a director has knowledge that another director has not made a disclosure, to notify the presiding officer of the board of this fact, or to notify the board secretary if the presiding officer is the person who failed to make the disclosure. Authorizes the presiding officer or secretary, as appropriate, to make a preliminary inquiry regarding the disclosure and to notify in writing the official who appointed the director of the alleged failure to disclose and the reasons for believing that a failure to disclose occurred. (e) Prohibits an employee from receiving, during a 12-month period, any gifts from a vendor that have a total value of more than $250 unless the employee receives written approval from the presiding officer. Sec. 335.109. REQUEST FOR OPINION FROM GENERAL COUNSEL. Authorizes an employee, with the presiding officer's consent, or a director to seek a written advisory opinion from the district's general counsel concerning whether a violation of Section 335.107 or 335.108 exists in a certain situation. Provides that the request must provide detailed information about the alleged violation or hypothetical situation. Requires the district's general counsel, after receiving a request, to prepare a written advisory opinion addressing whether a violation has occurred under the information provided. Authorizes a director or employee to rely in good faith on a written advisory opinion issued with respect to a potential violation of Section 335.107 or 335.108. Sec. 335.110. PENALTIES. Authorizes the board to reprimand, suspend, or terminate an employee who violates the district's code of conduct. SECTION 3. Effective date: September 1, 1999. Makes application of Section 335.107 of this Act prospective. SECTION 4. Emergency clause. EXPLANATION OF AMENDMENTS Committee Amendment #1 amends proposed Section 335.0711, Local Government Code, by providing a new title as follows: Sec. 335.0711. New title: LIMIT ON POWER TO OWN OR ACQUIRE REAL PROPERTY IN CERTAIN DISTRICTS. Defines two more terms, "real property" and "related infrastructure," and redesignates the subdivisions, paragraphs, and subparagraphs accordingly. Replaces proposed text of Section 335.0711(c), Local Government Code, as follows: (c) Prohibits a district from owning or acquiring real property by eminent domain or any other method unless the property is for a facility site or related infrastructure as part of an approved venue project in existence as of April 1, 1999, and unless the governing bodies of the municipality and county by resolution or order approve the acquisition. Defines "code of conduct" in proposed Section 335.101, Local Government Code, and redesignates the subdivisions accordingly. Replaces proposed text of Section 335.104, Local Government Code, as follows: Sec. 335.104. CREATION OF CODE OF CONDUCT; DISTRIBUTION. Requires the board, by rule, to adopt and maintain a code of conduct that establishes the general duties of directors and employees of the district and specific rules for directors, employees, and vendors. Provides that the code of conduct must include the specified items. Requires the presiding officer of the board to provide the code of conduct to directors, employees, and vendors as often as necessary. Deletes proposed Subsection (d), Section 335.107, Local Government Code, and redesignates the subsections accordingly. Amends the redesignated Subsection (e), Section 335.107, Local Government Code, to provide that a contract is "voidable" rather than "void." Amends proposed Section 335.108(b) to provide that the disclosure requirement applies to a director or employee and requires disclosure for a person related to that director or employee within the first degree by consanguinity or by affinity. Committee Amendment #2 adds new SECTIONS 3, 4, and 5, as follows: SECTION 3. Amends Section 335.031(c), Local Government Code, to provide that a director may be removed by the appointing person, rather than the mayor or county judge, at any time without cause. SECTION 4. Amends Section 335.034, Local Government Code, to provide Section 335.035 (Additional Requirements for Board of District Created in Populous County) as an exception to the designation of a presiding officer. SECTION 5. Amends Subchapter C, Chapter 335, Local Government Code, by adding Section 335.035, as follows: Sec. 335.035. ADDITIONAL REQUIREMENTS FOR BOARD OF DISTRICT CREATED IN POPULOUS COUNTY. (a) Provides that this section applies only to the board of a district located in a county with a population of 2.4 million or more. (b) Requires the mayor of each municipality and the commissioners court of each county that created the district to appoint an equal number of directors in accordance with the orders creating the district and Section 335.031 (Composition and Appointment of Board). Provides that an appointment of a director by a mayor must be confirmed by a majority vote of the governing body of the municipality. (c) Requires the mayors of the municipalities and the commissioners courts of the counties that create the district to appoint a presiding officer by concurrent orders within 30 days of the date a vacancy occurs in the presiding officer's position. Provides that the appointment must be confirmed by a majority vote of the governing body of each municipality. Establishes that the presiding officer serves for a two-year term. (d) Requires the board, if the mayors and the commissioners courts fail to agree on the appointment of a presiding officer, to appoint, from the district's directors, a presiding officer by a majority vote at the first board meeting that follows the 30-day period. Provides that the confirmation requirement does not apply to an appointment of a presiding officer. (e) Requires a presiding officer to resign as a director before serving as presiding officer. Provides that the vacancy created by the resignation is filled by the authority that appointed the director. Provides that the appointed director serves for the remainder of the vacated term. (f) Provides that Section 335.031(b) does not apply to a district located in a county with a population of 2.4 million or more. Redesignates SECTIONS 3 (effective date) and 4 (emergency clause) to SECTIONS 6 and 7, respectively. Amends the redesignated SECTION 6 (effective date) by adding Subsection (c), as follows: (c) Makes application of this Act prospective to an appointment of a director or presiding officer to the board of a venue district on or after the effective date of this Act.