CHAPTER 16. FINANCIAL REGULATORY AGENCIES: SELF-DIRECTED AND SEMI-INDEPENDENT - Texas Statutes

FINANCE CODE

TITLE 2. FINANCIAL REGULATORY AGENCIES

CHAPTER 16. FINANCIAL REGULATORY AGENCIES: SELF-DIRECTED AND

SEMI-INDEPENDENT

Sec. 16.001. DEFINITIONS. In this chapter:

(1) "Financial regulatory agency" means:

(A) the Texas Department of Banking;

(B) the Department of Savings and Mortgage Lending;

(C) the Office of Consumer Credit Commissioner; and

(D) the Credit Union Department.

(2) "Policy-making body" means:

(A) the Finance Commission of Texas for:

(i) the Texas Department of Banking;

(ii) the Department of Savings and Mortgage Lending; and

(iii) the Office of Consumer Credit Commissioner; and

(B) the Credit Union Commission for the Credit Union Department.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.002. SELF-DIRECTED AND SEMI-INDEPENDENT STATUS OF

FINANCIAL REGULATORY AGENCIES. Notwithstanding any other

provision of law, a financial regulatory agency is self-directed

and semi-independent as specified by this chapter. Any Act of

the 81st Legislature that relates to a financial regulatory

agency and that is inconsistent with the agency being

self-directed and semi-independent may be implemented by the

financial regulatory agency only on authorization by the

policy-making body of the financial regulatory agency.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.003. BUDGET, REVENUES, AND EXPENSES. (a) A financial

regulatory agency shall submit to the policy-making body of the

financial regulatory agency a budget annually using generally

accepted accounting principles. Notwithstanding any other

provision of law, including the General Appropriations Act, the

budget shall be adopted and approved only by the policy-making

body of the financial regulatory agency.

(b) A financial regulatory agency shall be responsible for all

direct and indirect costs of the agency's existence and

operation. The financial regulatory agency may not directly or

indirectly cause the general revenue fund to incur any cost.

(c) Subject to any limitations in a financial regulatory

agency's enabling legislation, a financial regulatory agency may

set the amounts of fees, penalties, charges, and revenues

required or permitted by statute or rule as necessary for the

purpose of carrying out the functions of the financial regulatory

agency and funding the budget adopted and approved under

Subsection (a).

(d) All fees and funds collected by a financial regulatory

agency and any funds appropriated to the financial regulatory

agency shall be deposited in interest-bearing deposit accounts in

the Texas Treasury Safekeeping Trust Company. The comptroller

shall contract with the financial regulatory agency for the

maintenance of the deposit accounts under terms comparable to a

contract between a commercial banking institution and the

institution's customers.

(e) Periodically, each financial regulatory agency shall submit

to the agency's policy-making body, as directed by the

policy-making body, a report of the receipts and expenditures of

the financial regulatory agency.

(f) The fiscal year for a financial regulatory agency begins on

September 1 and ends on August 31.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.004. AUDITS. This chapter does not affect the duty of

the state auditor to audit a financial regulatory agency. The

state auditor shall enter into a contract and schedule with each

financial regulatory agency to conduct audits, including

financial reports and performance audits. The financial

regulatory agency shall reimburse the state auditor for all costs

incurred in performing the audits and shall provide to the

governor a copy of any audit performed.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.005. RECORDS; REPORTING REQUIREMENTS. (a) A financial

regulatory agency shall keep financial and statistical

information as necessary to disclose completely and accurately

the financial condition and results of operations of the agency.

(b) Before the beginning of each regular session of the

legislature, each financial regulatory agency shall submit to the

legislature and the governor a report describing all of the

agency's activities in the previous biennium. The report must

include:

(1) an audit as required by Section 16.004;

(2) a financial report of the previous fiscal year, including

reports on financial condition and results of operations;

(3) a description of all changes in fees imposed on regulated

industries;

(4) a report on changes in the regulatory jurisdiction of the

agency, including the number of chartered financial institutions,

license holders, and registrants subject to the agency's

jurisdiction and any changes in those figures; and

(5) a list of all new rules adopted or repealed.

(c) In addition to the reporting requirements of Subsection (b),

not later than November 1 of each year, each financial regulatory

agency shall submit to the governor, the committee of each house

of the legislature that has jurisdiction over appropriations, and

the Legislative Budget Board a report that contains:

(1) the salary for all financial regulatory agency personnel and

the total amount of per diem expenses and travel expenses paid

for all agency employees;

(2) the total amount of per diem expenses and travel expenses

paid for each member of the agency's policy-making body, provided

that only one report must be submitted regarding the Finance

Commission of Texas;

(3) the agency's operating plan and annual budget; and

(4) a detailed report of all revenue received and all expenses

incurred by the financial regulatory agency in the previous 12

months.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.006. ABILITY TO CONTRACT. (a) To carry out and promote

the objectives of this chapter, a financial regulatory agency may

enter into contracts and do all other acts incidental to those

contracts that are necessary for the administration of the

agency's affairs and for the attainment of the agency's purposes,

except as limited by Subsection (b).

(b) Any indebtedness, liability, or obligation of the financial

regulatory agency incurred under this section may not:

(1) create a debt or other liability of this state or another

entity other than the financial regulatory agency; or

(2) create any personal liability on the part of the members of

the policy-making body or the body's or agency's employees.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.007. PROPERTY. A financial regulatory agency may:

(1) acquire by purchase, lease, gift, or any other manner

provided by law and maintain, use, and operate any real,

personal, or mixed property, or any interest in property,

necessary or convenient to the exercise of the powers, rights,

privileges, or functions of the financial regulatory agency;

(2) sell or otherwise dispose of any real, personal, or mixed

property, or any interest in property, that the financial

regulatory agency determines is not necessary or convenient to

the exercise of the agency's powers, rights, privileges, or

functions;

(3) construct, extend, improve, maintain, and reconstruct, or

cause to construct, extend, improve, maintain, and reconstruct,

and use and operate all facilities necessary or convenient to the

exercise of the powers, rights, privileges, or functions of the

financial regulatory agency; and

(4) borrow money, as may be authorized from time to time by an

affirmative vote of a two-thirds majority of the policy-making

body of the financial regulatory agency, for a period not to

exceed five years if necessary or convenient to the exercise of

the financial regulatory agency's powers, rights, privileges, or

functions.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.008. SUITS. The office of the attorney general shall

represent a financial regulatory agency in any litigation. The

attorney general may assess and collect from the financial

regulatory agency reasonable attorney's fees associated with any

litigation under this section.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.009. POST-PARTICIPATION LIABILITY. (a) If a financial

regulatory agency no longer has status under this chapter as a

self-directed semi-independent financial regulatory agency for

any reason, the agency shall be liable for any expenses or debts

incurred by the agency during the time the agency was a

self-directed semi-independent financial regulatory agency. The

agency's liability under this section includes liability for any

lease entered into by the agency. This state is not liable for

any expense or debt covered by this subsection, and money from

the general revenue fund may not be used to repay the expense or

debt.

(b) If a financial regulatory agency no longer has status under

this chapter as a self-directed semi-independent financial

regulatory agency for any reason, ownership of any property or

other asset acquired by the agency during the time the agency was

a self-directed semi-independent financial regulatory agency,

including unexpended fees in a deposit account in the Texas

Treasury Safekeeping Trust Company, shall be transferred to this

state.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.010. DUE PROCESS; OPEN GOVERNMENT. A financial

regulatory agency is:

(1) a governmental body for purposes of Chapters 551 and 552,

Government Code; and

(2) a state agency for purposes of Chapters 2001 and 2005,

Government Code.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.011. MEMBERSHIP IN EMPLOYEES RETIREMENT SYSTEM.

Employees of the financial regulatory agencies are members of the

Employees Retirement System of Texas under Chapter 812,

Government Code, and the agencies' transition to independent

status as provided by this chapter has no effect on their

membership or any benefits under that system.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.

Sec. 16.012. GIFTS. (a) Notwithstanding any other law, a

financial regulatory agency may not accept a gift, grant, or

donation:

(1) from a party to an enforcement action; or

(2) to pursue a specific investigation or enforcement action.

(b) A financial regulatory agency must:

(1) report each gift, grant, or donation that the agency

receives as a separate item in the agency's report required under

Section 16.005(b); and

(2) include with the report a statement indicating the purpose

for which each gift, grant, or donation was donated and used.

Added by Acts 2009, 81st Leg., R.S., Ch.

1317, Sec. 28(a), eff. September 1, 2009.