HBA-ALS H.B. 2090 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2090 By: Cuellar State Affairs 3/31/1999 Introduced BACKGROUND AND PURPOSE There is a concern that some small businesses in Texas may be threatened by competition from taxexempt organizations, such as state agencies and political subdivisions, engaging in commercial forprofit activities. The purpose of this bill is to provide small businesses a grievance procedure regarding the tax-exempt status of a particular tax-exempt organization engaging in commercial forprofit activities. H.B. 2090 prevents a state agency or political subdivision from engaging in specific commercial practices unrelated to the purposes set out in its charter, except in particular circumstances. This bill allows a small business to submit a complaint regarding an alleged violation to the attorney general, and specifies the available remedies. 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 Title 2, Business & Commerce Code, by adding Chapter 21, as follows: CHAPTER 21. COMPETITION BETWEEN STATE AGENCY OR POLITICAL SUBDIVISION AND PRIVATE BUSINESS Sec. 21.01. DEFINITIONS. Defines "political subdivision," "small business," and "state agency." Sec. 21.02. UNLAWFUL PRACTICES. (a) Prohibits a state agency or political subdivision from funding, capitalizing, guaranteeing an indebtedness or lease obligation of, or subsidizing a commercial business that is unrelated to the state agency's or political subdivision's charter, or other governing legal documents, unless the business is solely for the use of the state agency's or political subdivision's employees, staff, faculty, students, volunteers, patients, or residents or the business involves sales to the public that are incidental or occasional and not permanent, ongoing, or periodic. (b) Provides that a person is not considered an employee, staff or faculty member, student, volunteer, patient, or resident of a state agency or political subdivision, if the person's only relationship with the agency or political subdivision is receiving a product or service from the commercial business or a family relationship with a beneficiary of the state agency or political subdivision. Sec. 21.03. OTHER ACTIVITY. Provides that a state agency or political subdivision does not violate this chapter by making investments in publicly traded stocks and bonds, real estate, or investments that are not under its control or using its facilities to host groups meeting solely for educational purposes. Sec. 21.04. EXISTING BUSINESSES. Makes application of this Act prospective. Sec. 21.05. COMPLAINTS. Authorizes a small business to submit to the attorney general a complaint regarding a violation of this chapter. Requires the attorney general to bring an action under Section 21.07, issue to the small business a written determination under Section 21.06, or issue a written statement as to why the action will not be brought or a determination issued, no later than the 60th day after the date a complaint is submitted. Authorizes a small business, if the attorney general does not bring the action or issue the written determination or statement, to petition a court for a writ of mandamus ordering the attorney general to do so. Sec. 21.06. REMEDY. Authorizes a small business that is determined by the attorney general to have been aggrieved by a violation of this chapter to bring an court action for injunctive relief, economic damages, or both. Sec. 21.07. INJUNCTION. Authorizes the attorney general to sue to enjoin a person from violating this chapter. Prohibits the attorney general from filing suit before the eighth day after the day on which the attorney general notifies the person against whom the suit is to be brought. Provides that if the attorney general intends to request that the court issue a temporary restraining order, notice is not required and the attorney general is authorized to immediately file suit. Entitles the attorney general to recover all reasonable costs of prosecuting the case, including specified costs and fees. SECTION 2.Effective date: September 1, 1999. SECTION 3.Emergency clause.