TITLE 1. GENERAL PROVISIONS
Subchapter A. General Provisions
(a) This code is enacted as a part of the state´s continuing statutory revision program, begun by the Texas Legislative Council in 1963 as directed by the legislature in the law codified as Section 323.007, Government Code. The program contemplates a topic-by-topic revision of the state´s general and permanent statute law without substantive change.
(b) Consistent with the objectives of the statutory revision program, the purpose of this code is to make the law encompassed by this code more accessible and understandable by:
(1) rearranging the statutes into a more logical order;
(2) employing a format and numbering system designed to facilitate citation of the law and to accommodate future expansion of the law;
(3) eliminating repealed, duplicative, unconstitutional, expired, executed, and other ineffective provisions; and
(4) restating the law in modern American English to the greatest extent possible.
Chapter 311, Government Code (Code Construction Act), applies to the construction of each provision in this code except as otherwise expressly provided by this code.
A reference in a law to a statute or a part of a statute revised by this code is considered to be a reference to the part of this code that revises that statute or part of that statute.
(a) Unless expressly authorized by another statute and except as provided by Subsection (b), a municipality or county may not adopt, enforce, or maintain an ordinance, order, or rule regulating conduct in a field of regulation that is occupied by a provision of this code. An ordinance, order, or rule that violates this section is void, unenforceable, and inconsistent with this code.
(b) A municipality or county may enforce or maintain an ordinance, order, or rule regulating any conduct under Chapter 393 and any conduct related to a credit services organization, as defined by Section 393.001 or by any other provision of this code, or a credit access business, as defined by Section 393.601 or by any other provision of this code, if:
(1) the municipality or county adopted the ordinance, order, or rule before January 1, 2023; and
(2) the ordinance, order, or rule would have been valid under the law as it existed before the date this section was enacted.
TITLE 2. FINANCIAL REGULATORY AGENCIES
Subchapter A. General Provisions
(a) The definitions provided by §31.002 apply to this chapter.
(b) In this chapter, "finance agency" means:
(1) the Texas Department of Banking;
(2) the Department of Savings and Mortgage Lending; or
(3) the Office of Consumer Credit Commissioner.
(a) The finance commission is responsible for overseeing and coordinating the Texas Department of Banking, the Department of Savings and Mortgage Lending, and the Office of Consumer Credit Commissioner and serves as the primary point of accountability for ensuring that state depository and lending institutions function as a system, considering the broad scope of the financial services industry. The finance commission is the policy-making body for those finance agencies and is not a separate state agency. The finance commission shall carry out its functions in a manner that protects consumer interests, maintains a safe and sound banking system, and increases the economic prosperity of the state.
(b) The finance commission shall prepare and periodically update a strategic plan for coordination of the state financial system. Each finance agency shall cooperate in preparation of the plan.
Subchapter B. Composition and Operation
(a) The Finance Commission of Texas is composed of 11 members appointed by the governor with the advice and consent of the senate.
(b) Members of the finance commission serve staggered six year terms, with as near as possible to one-third of the members' terms expiring February 1 of each even-numbered year.
(c) An appointment to the finance commission must be made without regard to the race, color, age, sex, religion, disability, or national origin of the appointee.
(a) A member of the finance commission must be a registered voter of this state. Not more than two members may be residents of the same state senatorial district.
(b) Two members of the finance commission must be banking executives, one member of the finance commission must be a savings executive, one member of the finance commission must be a consumer credit executive, and one member of the finance commission must be a residential mortgage loan originator licensed under Chapter 156 or 157.
(c) Six members of the finance commission must be representatives of the general public. At least one of those members must be a certified public accountant.
(d) A person may not be a public member of the finance commission if the person or the person´s spouse:
(1) is registered, certified, or licensed by a regulatory agency in an industry regulated by a finance agency;
(2) is employed by or participates in the management of a business entity or other organization regulated by or receiving money from a finance agency;
(3) owns or controls, directly or indirectly, more than a 10 percent interest in a business entity or other organization regulated by or receiving money from a finance agency; or
(4) uses or receives a substantial amount of tangible goods, services, or money from a finance agency other than compensation or reimbursement authorized by law for finance commission membership, attendance, or expenses.
(e) For the purposes of this section:
(1) "Banking executive" means a person who:
(A) has had five years´ or more executive experience in a bank during the seven-year period preceding the person´s appointment; and
(B) is an officer of a state bank.
(2) "Savings executive" means a person who:
(A) has had five years´ or more executive experience in a savings association or savings bank during the seven-year period preceding the person´s appointment; and
(B) is an officer of a state savings association or savings bank.
(3) "Consumer credit executive" means a person who:
(A) has had five years´ or more executive experience in an entity regulated by the consumer credit commissioner during the seven-year period preceding the person´s appointment; and
(B) is an officer of an entity regulated by the consumer credit commissioner.
(4) "Residential mortgage loan originator" means a person who:
(A) has had five years´ or more experience as a residential mortgage loan originator, as defined by Section 180.002, during the seven-year period preceding the person´s appointment; and
(B) is a residential mortgage loan originator, as defined by Section 180.002.
(f) Experience as banking commissioner, deputy banking commissioner, examiner, or supervisor of examiners for a state or federal banking regulatory agency is considered executive experience in a bank for the purposes of Subsection (e)(1)(A). Experience as savings and mortgage lending commissioner, deputy savings and mortgage lending commissioner, examiner, or supervisor of examiners for a state or federal savings and loan regulatory agency is considered executive experience in a savings association or savings bank for the purposes of Subsection (e)(2)(A).
(a) In this section, "Texas trade association" means a cooperative and voluntarily joined association of business or professional competitors in this state designed to assist its members and its industry or profession in dealing with mutual business or professional problems and in promoting their common interest.
(b) A person may not be a member of the finance commission if:
(1) the person is an officer, employee, or paid consultant of a Texas trade association in an industry regulated by a finance agency; or
(2) the person´s spouse is an officer, manager, or paid consultant of a Texas trade association in an industry regulated by a finance agency.
(c) A person may not be a member of the finance commission if the person is required to register as a lobbyist under Chapter 305, Government Code, because of the person´s activities for compensation on behalf of a profession related to the operation of a finance agency.
(a) It is a ground for removal from the finance commission that a member:
(1) does not have at the time of taking office the qualifications required by Section 11.102;
(2) does not maintain during service on the finance commission the qualifications required by Section 11.102;
(3) is ineligible for membership under Section 11.102 or 11.1021;
(4) cannot, because of illness or disability, discharge the member´s duties for a substantial part of the member´s term; or
(5) is absent from more than half of the regularly scheduled finance commission meetings that the member is eligible to attend during a calendar year without an excuse approved by a majority vote of the finance commission.
(b) If the banking commissioner, savings and mortgage lending commissioner, or consumer credit commissioner has knowledge that a potential ground for removal exists, the banking commissioner, savings and mortgage lending commissioner, or consumer credit commissioner shall notify the presiding officer of the finance commission of the potential ground. The presiding officer shall then notify the governor and the attorney general that a potential ground for removal exists. If the potential ground for removal involves the presiding officer, the banking commissioner, savings and mortgage lending commissioner, or consumer credit commissioner shall notify the next highest ranking officer of the finance commission, who shall then notify the governor and the attorney general that a potential ground for removal exists.
(c) The validity of an action of the finance commission is not affected by the fact that it was taken when a ground for removal of a member of the finance commission existed.
A member of the finance commission is entitled to:
(1) the reimbursement for reasonable and necessary expenses incidental to travel incurred in connection with the performance of official duties; and
(2) a per diem for each day that the member engages in the business of the finance commission.
A member of the finance commission may not act or participate in the portion of a commission meeting during which the matter considered specifically relates to an entity:
(1) of which the member or the member´s spouse is an officer, director, stockholder, shareholder, or owner; or
(2) in which the member or the member´s spouse has another financial interest.
(a) The finance commission shall hold at least six regular public meetings during each calendar year on dates set by the commission.
(b) The presiding officer or three members of the finance commission may call a special public meeting of the commission.
(c) The finance commission may hold an open or closed special meeting by telephone conference call if:
(1) immediate action is required;
(2) the convening at one location of a quorum of the finance commission is difficult or impossible;
(3) notice is given for the meeting as for other meetings;
(4) the notice specifies a location for the meeting at which the public may attend;
(5) each part of the meeting that is required to be open to the public is audible to the public at the location specified in the notice of the meeting; and
(6) the meeting is tape-recorded and the tape recording of each portion of the meeting that is required to be open to the public is made available to the public.
(a) The governor shall appoint a member of the finance commission as presiding officer of the commission. The presiding officer serves at the will of the governor.
(b) The presiding officer shall preside at and provide for the keeping of minutes of each public meeting of the finance commission.
(c) The presiding officer may:
(1) adopt rules and procedures as the presiding officer considers necessary for the orderly operation of the finance commission and for communication among the finance commission, the Texas Department of Banking, theDepartment of Savings and Mortgage Lending, and the Office of Consumer Credit Commissioner;
(2) adopt internal procedures governing the time and place of meetings, the type of notice for special public meetings, the manner in which public meetings are to be conducted, and other similar matters; and
(3) appoint committees composed of finance commission members as the presiding officer considers necessary to carry out the commission´s business.
The finance commission is subject to Chapter 325, Government Code (Texas Sunset Act). Unless continued in existence as provided by that chapter, the commission is abolished September 1, 2031.
The presiding officer of the finance commission or the presiding officer´s designee shall provide to members of the finance commission, as often as necessary, information regarding the requirements for office under this title, including information regarding a person´s responsibilities under applicable laws relating to standards of conduct for state officers.
(a) A person who is appointed to and qualifies for office as a member of the finance commission may not vote, deliberate, or be counted as a member in attendance at a meeting of the finance commission until the person completes a training program that complies with this section.1
(b) The training program must provide the person with information regarding:
(1) the legislation that created the finance agencies and the finance commission;
(2) the programs operated by the finance agencies;
(3) the role and functions of the finance agencies;
(4) the rules of the finance commission with an emphasis on the rules that relate to disciplinary and investigatory authority;
(5) the current budget for the finance agencies;
(6) the results of the most recent formal audit of the finance agencies;
(7) the requirements of:
(A) the open meetings law, Chapter 551, Government Code;
(B) the public information law, Chapter 552, Government Code;
(C) the administrative procedure law, Chapter 2001, Government Code; and
(D) other laws relating to public officials, including conflict-of-interest laws; and
(8) any applicable ethics policies adopted by the finance commission or the Texas Ethics Commission.
(c) A person appointed to the finance commission is entitled to reimbursement under Section 11.104, as if the person were a member of the finance commission, for the travel expenses incurred in attending the training program regardless of whether the attendance at the program occurs before or after the person qualifies for office.
(d) The commissioner of each finance agency shall create a training manual that includes the information required by Subsection (b) applicable to that commissioner's agency. The commissioner of each finance agency shall distribute a copy of the training manual created under this subsection annually to each member of the finance commission. Each member of the finance commission shall sign and submit to the appropriate commissioner a statement acknowledging that the member received and has reviewed the training manual.
(e) Notwithstanding Subsection (d), the commissioner of each finance agency may collaborate and jointly create one training manual that includes the information required by Subsection (b) applicable to each finance agency.
The finance commission shall develop and implement policies that clearly separate the policymaking responsibilities of the finance commission and the management responsibilities of the banking commissioner, savings and mortgage lending commissioner, and consumer credit commissioner and staff of the finance agencies.
The finance commission shall develop and implement policies that provide the public with a reasonable opportunity to appear before the finance commission and to speak on any issue under the jurisdiction of the finance agencies.
(a) The finance commission may appoint advisory committees to assist the finance commission in performing its duties.
(b) The finance commission shall specify each committee's purpose, powers, and duties and shall require each committee to report to the finance commission in the manner specified by the finance commission concerning the committee's activities and the results of its work.
Subchapter C. Staff and Expenses
(a) The finance commission shall direct a finance agency to employ an internal auditor to provide services to and facilitate commission oversight and control over the finance agencies.
(b) The Texas Department of Banking may employ a hearings officer to serve the finance agencies as determined by interagency agreement. For the purposes of Section 2003.021, Government Code, a hearings officer employed under this section may be retained under contract to provide services on a part-time basis and is considered to be an employee of each agency for which hearing services are provided. The hearings officer´s only duty under the hearings officer's contract is to preside over matters related to contested cases before a finance agency.
The internal auditor reports to the finance commission and is not subject to direction by the employing finance agency.
(a) The finance commission shall use the staff, equipment, and facilities of the finance agencies to the extent necessary to carry out the finance commission´s duties. To reduce administrative costs, the finance agencies shall share staff, equipment, and facilities to the extent that the sharing contributes to cost efficiency without detracting from the staff expertise needed for individual areas of agency responsibility.
(b) An interagency agreement must provide that the cost of staff used by the finance commission, including the internal auditor, is to be charged to the finance agencies in proportion to the amount of time devoted to each agency´s business. All other costs of operation of the finance commission are to be shared by and included in the budgets of the finance agencies in proportion to the amount of cash receipts of each of those agencies.
(c) The finance commission shall have charge and control of the property known as the Finance Commission Building and use of staff, equipment, and facilities of the finance agencies. The Finance Commission Building refers to the property located in the city of Austin and titled in the name of the Banking Section of the Finance Commission of Texas, as described by deed recorded in Volume 5080, Page 1099, of the Deed Records of Travis County, Texas.
Subchapter D. Power and Duties
The finance commission may adopt banking rules as provided by Section 31.003.
(a) The finance commission may adopt rules applicable to state savings associations or to savings banks and may authorize state savings associations and savings banks to invest money of state savings associations or savings banks in any manner permitted for a federal savings association or federal savings bank domiciled in this state. This subsection does not authorize the finance commission to diminish or limit a right or power specifically given to state savings associations or savings banks by state law.
(b) The finance commission may adopt rules to:
(1) prevent state savings associations or savings banks from concentrating an excessive or unreasonable portion of the resources of state savings associations or savings banks in a type or character of loan or security authorized by Subtitle B or C, Title 3; and
(2) establish standards for investments by state savings associations or savings banks, including limits on the amount that a state savings association or savings bank may invest in a type or character of investment to an amount or percentage of the savings association´s or savings bank´s assets or net worth.
Information regarding the financial condition of a state savings association or savings bank obtained through examination or otherwise may not be disclosed to a member of the finance commission, except that the savings and mortgage lending commissioner may disclose to the finance commission a file or record pertinent to a hearing or matter pending before the commission.
The finance commission may adopt rules necessary to supervise the consumer credit commissioner and ensure compliance with Chapter 14 and Title 4.
(a) The consumer credit commissioner shall establish a program to address alternatives to high-cost lending in this state. The program shall:
(1) study and report on high-cost lending, including the availability, quality, and prices of financial services offered in this state to individual consumers in this state; and
(2) evaluate alternatives to high-cost lending and the practices of business entities in this state that provide financial services to individual consumers in this state.
(b) The program may:
(1) apply for and receive public and private grants and gifts to conduct the research authorized by this section;
(2) contract with public and private entities to carry out studies and analyses under this section;
(3) provide funding for pilot programs; and
(4) make grants to nonprofit institutions working to provide alternatives to high-cost loans.
(c) Not later than December 1 of each year, the finance commission shall provide to the legislature a report detailing its findings and making recommendations to improve the availability, quality, and prices of financial services.
(d) The Texas Department of Banking and the Department of Savings and Mortgage Lending shall jointly conduct a continuing review of the condition of the state banking system. The review must include a review of all available national and state economic forecasts and an analysis of changing banking practices and new banking legislation. Periodically the departments shall submit a report to the finance commission on the results of the review, including information relating to the condition of the state banking system at the time of the report and the predicted condition of that system in the future.
(a) The finance commission may assign the banking commissioner, savings and mortgage lending commissioner, or consumer credit commissioner to conduct research on:
(1) the availability, quality, and prices of financial services, including lending and depository services, offered in this state to agricultural businesses, small businesses, and individual consumers in this state; and
(2) the practices of business entities in this state that provide financial services to agricultural businesses, small businesses, and individual consumers in this state.
(b) The banking commissioner, savings and mortgage lending commissioner, or consumer credit commissioner may:
(1) apply for and receive public and private grants and gifts to conduct the research authorized by this section; and
(2) contract with public and private entities to carry out studies and analyses under this section.
The finance commission may adopt residential mortgage loan origination rules as provided by Chapter 156.
(a) The finance commission shall adopt rules applicable to each entity regulated by the Texas Department of Banking or the Department of Savings and Mortgage Lending specifying the manner in which the entity provides consumers with information on how to file complaints with the appropriate agency.
(b) The finance commission shall adopt rules applicable to each entity regulated by a finance agency requiring the entity to include information on how to file complaints with the appropriate agency in each privacy notice that the entity is required to provide consumers under law, including Pub. L. No. 106-102.
The finance commission may, on request of an interested person or on its own motion, issue interpretations of Sections 50(a)(5)-(7), (e)-(p), (t), and (u), Article XVI, Texas Constitution. An interpretation under this section is subject to Chapter 2001, Government Code, and is applicable to all lenders authorized to make extensions of credit under Section 50(a)(6), Article XVI, Texas Constitution, except lenders regulated by the Credit Union Commission.1 The finance commission and the Credit Union Commission shall attempt to adopt interpretations that are as consistent as feasible or shall state justification for any inconsistency.
(a) In this section, "check verification entity" and "financial institution" have the meanings assigned by Section 523.052, Business & Commerce Code.
(b) The finance commission shall adopt rules:
(1) requiring a check verification entity to register with the banking commissioner:
(A) at the intervals the finance commission determines, but not less frequently than annually; and
(B) by providing to the banking commissioner the information that the finance commission determines is necessary to enable a financial institution or a check verification entity to comply with the requirements of Section 523.052, Business & Commerce Code;2
(2) authorizing the banking commissioner to charge a check verification entity a reasonable annual fee, not to exceed $100, to register with the commissioner; and
(3) requiring the banking commissioner to establish an electronic notification system, through secure e-mail or another secure system, to be used by a financial institution to notify check verification entities as required by Section 523.052, Business & Commerce Code.
(c) The finance commission may not impose a duty on the banking commissioner under Subsection (b)(3) to verify the validity or completeness of information transmitted through the electronic notification system.
(d) The banking commissioner may solicit and accept gifts, grants, and donations from public and private entities to establish and maintain the secure notification system.
Subchapter A. General Provisions
The definitions provided by Section 31.002 apply to this chapter.
Subchapter B. Operation of Department
(a) The banking commissioner is the chief executive officer of the Texas Department of Banking. The finance commission shall appoint the banking commissioner. The banking commissioner serves at the will of the finance commission and is subject to the finance commission´s orders and directions.
(b) The banking commissioner must have not less than seven years´ experience in banking or bank supervision.
(c) The finance commission shall set the compensation of the banking commissioner. The compensation shall be paid from money of the department.
(a) The banking commissioner shall appoint one or more deputy banking commissioners as necessary to the efficient operation of the department. The banking commissioner shall prescribe the qualifications and duties of a deputy banking commissioner.
(b) During the banking commissioner´s absence or inability to serve, a deputy banking commissioner has the powers and shall perform the duties of the banking commissioner.
Before assuming the duties of office, each deputy banking commissioner, examiner, assistant examiner, conservator, supervisor, and special agent, and each other officer or employee specified by the banking commissioner, must take an oath of office to:
(1) discharge faithfully the duties assigned; and
(2) uphold the constitution and laws of this state and of the United States.
(a) The finance commission shall establish reasonable and necessary fees for the administration of this chapter, Chapter 11, Chapter 13, and Subtitle A, Title 3.
(b) The costs of an audit of the department under Chapter 321, Government Code, shall be paid to the state auditor from the money of the department.
(a) The banking commissioner, a member of the finance commission, a deputy banking commissioner, an examiner, assistant examiner, supervisor, conservator, agent, or other officer or employee of the department, or an agent of the banking commissioner is not personally liable for damages arising from the person´s official act or omission unless the act or omission is corrupt or malicious.
(b) The attorney general shall defend an action brought against a person because of an official act or omission under Subsection (a) regardless of whether the defendant has terminated service with the department before the action commences.
(a) In this section, "Texas trade association" means a cooperative and voluntarily joined association of business or professional competitors in this state that:
(1) is primarily designed to assist its members and its industry or profession in dealing with mutual business or professional problems and in promoting their common interest; and
(2) includes business and professional competitors located in this state among its members.
(b) A person may not be a department employee if:
(1) the person is an officer, employee, or paid consultant of a Texas trade association in an industry regulated by the department; or
(2) the person´s spouse is an officer, manager, or paid consultant of a Texas trade association in an industry regulated by the department.
(c) A person may not act as the general counsel to the department if the person is required to register as a lobbyist under Chapter 305, Government Code, because of the person´s activities for compensation on behalf of a profession related to the operation of the department.
(d) A department employee may not:
(1) purchase an asset owned by a person regulated by the department in the possession of the banking commissioner or other receiver for purposes of liquidation, unless the asset is purchased at public auction or with the approval of the receivership court;
(2) except as provided by Subsection (e), become directly or indirectly indebted to a person regulated by the department;
(3) except as provided by Subsection (f), become directly or indirectly financially interested in a person regulated by the department; or
(4) obtain a product or service from a person regulated by the department, or an affiliate of a person regulated by the department, on terms or rates that are more favorable to the employee than those prevailing at the time for comparable transactions with or involving other similarly situated consumers.
(e) Subject to Subsection (d)(4) and except as otherwise provided by employment policies adopted by the banking commissioner, Subsection (d)(2) does not prohibit indebtedness of:
(1) a clerical or administrative employee to a person regulated by the department, if the employee does not exercise discretionary decision-making authority with respect to the person; or
(2) an employee of the department, other than a clerical or administrative employee, if the indebtedness was permissible when incurred and became prohibited indebtedness under Subsection (d)(2) as a result of employment by the department or a circumstance over which the employee has no control, including a merger, acquisition, purchase or sale of assets, or assumption of liabilities involving a regulated person, if the employee:
(A) repays the indebtedness; or
(B) does not knowingly participate in or consider any matter concerning the person to whom the employee is indebted.
(f) Except as otherwise provided by employment policies adopted by the banking commissioner, Subsection (d)(3) does not prohibit a financial interest of an employee of the department solely because:
(1) the employee owns publicly traded shares of a registered investment company (mutual fund) that owns publicly traded equity securities issued by a person regulated by the department; or
(2) the spouse of or other person related to the employee is employed by a person regulated by the department and receives equity securities of the person through participation in an employee benefit plan, including an employee stock option, bonus, or ownership plan, if:
(A) the sole purpose of the plan is to compensate employees with an ownership interest in the person for services rendered; and
(B) the employee does not knowingly participate in or consider any matter concerning the person until the spouse or other related person no longer owns equity securities issued by the person.
(g) The banking commissioner may adopt employment policies relating to this section, including policies to:
(1) require employees to notify the department of possible conflicts of interest;
(2) specify the manner or extent of required recusal;
(3) define the circumstances under which adverse employment action may be taken; and
(4) impose more restrictive requirements on senior officers of the department for whom recusal is not viable or consistent with the prudent exercise of the department´s responsibilities.
(h) The finance commission may adopt rules to administer this section, including rules to:
(1) codify employment policies of the banking commissioner adopted under Subsection (g);
(2) define or further define terms used by this section; and
(3) establish limits, requirements, or exemptions other than those specified by this section, except that an exempted employee must be recused from participation in or consideration of all regulatory matters specifically concerning the person to whom the exempted indebtedness is owed or the financial interest relates.
(i) Before the 11th day after the date on which an employee begins employment with the department, the employee shall read the conflict-of-interest statutes, rules, and policies applicable to employees of the department and sign a notarized affidavit stating that the employee has read those statutes, rules, and policies.
(a) The department shall maintain a system to promptly and efficiently act on complaints filed with the department. The department shall maintain information about parties to the complaint, the subject matter of the complaint, a summary of the results of the review or investigation of the complaint, and its disposition.
(b) The department shall make information available describing its procedures for complaint investigation and resolution.
(c) The department shall periodically notify the complaint parties of the status of the complaint until final disposition.
(a) The department shall seek to improve the financial literacy and education of persons in this state and to encourage access to mainstream financial products and services by persons who have not previously participated in the conventional finance system, by:
(1) coordinating, encouraging, and aiding banks in the development and promotion of financial literacy and education programs and community outreach;
(2) serving as a clearinghouse of information about financial literacy and education programs;
(3) creating and maintaining a resource bank of materials pertaining to financial literacy; and
(4) promoting replication of best practices and exemplary programs that foster financial literacy and education.
(b) The department may solicit and accept a gift, grant, or donation from any source, including a foundation, private entity, governmental entity, or institution of higher education, to assist in the implementation of this section.
The office of banking commissioner is subject to Chapter 325, Government Code (Texas Sunset Act). Unless continued in existence as provided by that chapter, the office is abolished September 1, 2031.
The banking commissioner or the banking commissioner´s designee shall provide to agency employees, as often as necessary, information regarding the requirements for office or employment under this chapter, including information regarding a person´s responsibilities under applicable laws relating to standards of conduct for state officers or employees.
(a) The banking commissioner or the banking commissioner´s designee shall prepare and maintain a written policy statement that implements a program of equal employment opportunity to ensure that all personnel decisions are made without regard to race, color, disability, sex, religion, age, or national origin.
(b) The policy statement must include:
(1) personnel policies, including policies relating to recruitment, evaluation, selection, training, and promotion of personnel, that show the intent of the department to avoid the unlawful employment practices described by Chapter 21, Labor Code; and
(2) an analysis of the extent to which the composition of the department´s personnel is in accordance with state and federal law and a description of reasonable methods to achieve compliance with state and federal law.
(c) The policy statement must:
(1) be updated annually;
(2) be reviewed by the state Commission on Human Rights for compliance with Subsection (b)(1); and
(3) be filed with the governor´s office.
(a) The finance commission by rule shall develop a policy to encourage the use of:
(1) negotiated rulemaking procedures under Chapter 2008, Government Code, for the adoption of rules by the finance commission applicable to the department; and
(2) appropriate alternative dispute resolution procedures under Chapter 2009, Government Code, to assist in the resolution of internal and external disputes under the department's jurisdiction.
(b) The procedures applicable to the department relating to alternative dispute resolution must conform, to the extent possible, to any model guidelines issued by the State Office of Administrative Hearings for the use of alternative dispute resolution by state agencies.
(c) The department shall:
(1) coordinate the implementation of the policy adopted under Subsection (a);
(2) provide training as needed to implement the procedures for negotiated rulemaking or alternative dispute resolution; and
(3) collect data concerning the effectiveness of those procedures.
(a) The banking commissioner may appoint advisory committees to assist the department and banking commissioner in performing their duties.
(b) The banking commissioner shall specify each committee's purpose, powers, and duties and shall require each committee to report to the banking commissioner or department in the manner specified by the banking commissioner concerning the committee's activities and the results of its work.
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.
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.
(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.
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.
(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.
(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.
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.
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.
(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.
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.
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.
(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.
Subchapter A. General Provisions
In this chapter:
(1) "Credit union" means a state or federal credit union.
(2) "Finance commission" means the Finance Commission of Texas.
(3) "Financial institution" means a state or national bank, a state or federal savings bank, or a state or federal savings and loan association.(4) "Local government" means a municipality or county.
Subchapter B. Banking Development Districts
The finance commission shall administer and monitor a banking development district program under this chapter to encourage the establishment of branches of a financial institution in geographic areas where there is a demonstrated need for banking services.
(a) Subject to Subsection (b), the finance commission shall adopt rules to implement this subchapter and Subchapter D with respect to financial institutions in banking development districts.
(b) The finance commission, in consultation with the Texas Economic Development and Tourism Office, shall adopt rules regarding the criteria for the designation of banking development districts under this subchapter. The rules must require the finance commission to consider:
(1) the location, number, and proximity of sites where banking services are available in the proposed banking development district;
(2) consumer needs for banking services in the proposed district;
(3) the economic viability and local credit needs of the community in the proposed district;
(4) the existing commercial development in the proposed district; and
(5) the impact additional banking services would have on potential economic development in the proposed district.
A local government, in conjunction with a financial institution, may submit an application to the finance commission for the designation of a banking development district.
A financial institution may apply to open a branch in the proposed banking development district at the time the local government submits an application in conjunction with the institution under Section 279.053.
(a) Not later than the 120th day after the date an application for the designation of a banking development district is submitted under §279.053, the finance commission shall make a determination regarding whether to approve the application.
(b) If the finance commission approves the application, the finance commission shall notify the:
(1) local government;
(2) financial institution;
(3) comptroller;
(4) Texas Economic Development and Tourism Office;
(5) lieutenant governor; and
(6) speaker of the house of representatives.
SUBCHAPTER C. Credit Union Development Districts
SUBCHAPTER D. Deposit of Public Funds in District Depository
(a) The governing body of a local government in which a banking development district has been designated under Subchapter B may by resolution designate a financial institution located in the district as a banking district depository for purposes of this subchapter.
(b) The governing body of a local government in which a credit union development district has been designated under Subchapter C may by resolution designate a credit union located in the district as a credit union district depository for purposes of this subchapter.
(c) A resolution adopted under Subsection (a) or (b) must specify the maximum amount that may be kept on deposit with the banking district or credit union district depository, as appropriate.
(d) In calculating the yield under Section 2256.006, Government Code, of public funds deposited in a banking district or credit union district depository, the governing body of a local government may consider the benefit to this state of stimulating economic development.
(a) A local government may deposit public funds with a financial institution designated as a banking district depository or a credit union designated as a credit union district depository under Section 279.151 regardless of whether the financial institution or credit union is designated by the comptroller as a state depository under Subchapter C, Chapter 404, Government Code.
(b) Subject to an agreement between the governing body and the banking district or credit union district depository, public funds deposited in the district depository may earn a fixed interest rate that is at or below the financial institution's or credit union's posted two-year certificate of deposit rate, as appropriate. The terms of the agreement must be specified in the applicable resolution adopted under Section 279.151.
(a) If the comptroller designates the financial institution as a state depository under Subchapter C, Chapter 404, Government Code, the comptroller may deposit public funds with a financial institution designated as a banking district depository under Section 279.151(a).
(b) If the comptroller designates the credit union as a state depository under Subchapter C, Chapter 404, Government Code, the comptroller may deposit public funds with a credit union designated as a credit union district depository under Section 279.151(b).
(c) For purposes of Subsections (a) and (b), a financial institution or credit union is subject to the collateral requirements of Section 404.031, Government Code.
(d) Subject to an agreement between the comptroller and the banking district or credit union district depository, public funds deposited in the district depository may earn a fixed interest rate that is at or below the financial institution's or credit union's posted two-year certificate of deposit rate, as appropriate.
(e) In calculating the yield under Section 2256.006, Government Code, of public funds deposited in a banking district or credit union district depository, the comptroller may consider the benefit to this state of stimulating economic development.