HBA-DMD H.B. 1094 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 1094 By: Burnam State Affairs 4/12/1999 Introduced BACKGROUND AND PURPOSE The U.S. State Department has indicated that the country of Burma provides the bulk of the world's opium supply and is the source of 60 percent of the heroin that is seized in the United States. According to the Texas Commission on Alcohol and Drug Abuse, the cost to Texas taxpayers of heroin abuse in 1994 was more than $400 million. H.B. 1094 is a selective purchasing law that seeks to penalize the current Burmese government for its failure to stem that country's drug production by prohibiting government entities from purchasing goods or services from vendors that do business with Burma, with certain exceptions. The bill also requires the General Services Commission to establish and maintain a list of vendors doing business with Burma and to update the list every three months and file a biennial report with the legislature on every odd-numbered year. Additionally, the bill prohibits a government entity from investing in or purchasing obligations of a private corporation or other private businesses doing business with Burma and requires a governmental entity to divest all public funds that are invested in an entity that does business with Burma. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the General Services Commission in SECTION 1 (Section 2252.114, Government Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 2252, Government Code, by adding Subchapter E, as follows: SUBCHAPTER E. PURCHASES FROM VENDORS DOING BUSINESS WITH THE COUNTRY OF BURMA Sec. 2252.111. DEFINITIONS. Defines "Burma," "commission," "distribution agreement," "doing business in Burma," "franchisee," "government of Burma," "governmental entity," "licensee," "majority-owned subsidiary," and "vendor." Sec. 2252.112. PURCHASES FROM BUSINESSES DOING BUSINESS IN BURMA. (a) Prohibits a governmental entity from purchasing goods or services from a vendor that does business in Burma, with exceptions. (b) Requires a vendor who is offering to sell goods or services to a governmental entity to certify to the governmental entity that the vendor does not do business in Burma. Requires the attorney general to prepare the form on which the certification must be made. (c) Authorizes a governmental entity to purchase goods or services from a vendor who is doing business in Burma only after certifying in writing to the commission that the purchase is essential to the governmental entity and compliance with Subsection (a) would eliminate the only bid or offer the governmental entity has received regarding a proposed purchase, or that complying with Subsection (a) would result in inadequate competition regarding a proposed purchase. (d) Authorizes a governmental entity, notwithstanding Subsection (a), to purchase goods or services from a vendor who has operations in Burma provided that those operations are for the sole purpose of reporting the news, providing medical supplies, or providing goods or services for the provision of international telecommunications. Sec. 2252.113. LIST OF INELIGIBLE VENDORS. Requires the General Services Commission (commission) to establish and maintain a list of vendors that are known to do business with Burma. Requires the commission to update the list at least once every three months and to make the list available to all governmental entities. Sec. 2252.114. RULES. Requires the commission to adopt rules to implement this chapter. Sec. 2252.115. BIENNIAL REPORT. Requires the commission to file a biennial report with the senate and house of representatives, not later than January 1 of each odd-numbered year, that provides details about compliance with this subchapter. SECTION 2. Amends Subchapter B, Chapter 2256, Government Code, by adding Section 2256.057, as follows: Sec. 2256.057. INVESTMENT IN BURMA. (a) Defines "Burma," "distribution agreement," "doing business in Burma," "franchisee," "government of Burma," "licensee," and "majority-owned subsidiary" with the meanings assigned by Section 2252.111. (b) Prohibits a state agency or local government from investing in or purchasing obligations of a private corporation or other private business entity doing business with Burma. (c) Provides that the prohibition prescribed by Subsection (a) applies to an investment or purchase of obligations without regard to whether Subchapter A applies to the investment or purchase. SECTION 3. (a) Makes application of Section 1 of this Act prospective. (b) Provides that Section 2 of this Act applies to an investment made before, on, or after, the effective date of this Act. Requires a governmental entity subject to Section 2256.057, Government Code, to divest all public funds invested in an entity that does business with Burma not later than September 1, 2001. SECTION 4.Effective date: September 1, 1999. SECTION 5.Emergency clause.