31 TAC §365.10
The Texas Water Development Board (board) proposes amendments
to 31 TAC §365.10 concerning Ethics and Conflicts of Interest. Amendments
to this section are proposed to comply with the requirement of Texas Government
Code §2263.004 that the board adopt standards of conduct applicable to
financial advisors or service providers who are not employees of the state
agency, who may reasonably be expected to receive more than $10,000 in compensation
during a fiscal year, and who provide financial services to the state agency
or advise the state agency or a member of the governing body of the state
agency in connection with the management or investment of state funds.
The proposed addition of §365.10(c) incorporates the language of Government
Code §2263.005 that financial analysts and service providers described
by Government Code §2263.004 should avoid:
(1) any relationship with any party to a transaction with the board or
the Texas Water Resources Finance Authority (authority), other than a relationship
necessary to the investment or funds management services that the financial
advisor or service provider performs for the board or authority, if a reasonable
person could expect the relationship to diminish the financial advisor's or
service provider's independence of judgment in the performance of the person's
responsibilities to the board or authority.
(2) any direct or indirect pecuniary interest in any party to a transaction
with the board or authority, if the transaction is connected with any financial
advice or service the financial advisor or service provider provides to the
board or authority or to a member of the board in connection with the management
or investment of state funds.
The proposed addition of §365.13(d) requires that financial analysts
or service providers described by Government Code §2263.004 must report
any relationship or pecuniary interest described in subsection (c) in writing
to the board's executive administrator or designated representative, without
regard to whether the relationship is a direct, indirect, personal, private,
commercial, or business relationship.
Veronica Hinojosa-Segura, Chief Financial Officer, has determined that
for the first five-year period the amendments are in effect, there will not
be fiscal implications on state and local government as a result of enforcement
and administration of the amended section.
Ms. Hinojosa-Segura also determined that for the first five years the amendments,
as proposed, are in effect, the public benefit anticipated as a result of
enforcing the proposed amendments will be increased clarity and efficiency
in the reporting of conflicts of interest. Ms. Callahan has determined there
will not be economic costs to small businesses or individuals required to
comply with the amendments as proposed.
Comments on the proposal will be accepted for 30 days following publication
and may be submitted to Jim Bateman, Attorney, Office of General Counsel,
Texas Water Development Board, P.O. Box 13231, Austin, Texas 78711-3231, or
by e-mail to jim.bateman@twdb.state.tx.us or by fax at (512) 463-5580.
The amendments are proposed under the authority of the Texas
Water Code §6.101, which provides the Texas Water Development Board with
the authority to adopt rules necessary to carry out the powers and duties
in the Texas Water Code and other laws of the State, and the Texas Government
Code §2263.004, which requires the Texas Water Development Board to adopt
rules regarding standards of conduct applicable to financial advisors and
service providers who are not employees of the Board, who provide financial
services to the state agency or advise the state agency or a member of the
governing body of the state agency in connection with the management or investment
of state funds.
The proposed amendments implement Texas Government Code Chapter 2263.
§365.10.Ethics and Conflicts of Interest.
(a) - (b)
(No change.)
(c)
Financial analysts and service providers
described by Government Code §2263.004 should avoid:
(1)
any relationship with any party to a transaction with the
board or authority, other than a relationship necessary to the investment
or funds management services that the financial advisor or service provider
performs for the board or authority, if a reasonable person could expect the
relationship to diminish the financial advisor's or service provider's independence
of judgment in the performance of the person's responsibilities to the board
or authority; and
(2)
any direct or indirect pecuniary interest in any party
to a transaction with the board or authority, if the transaction is connected
with any financial advice or service the financial advisor or service provider
provides to the board or authority or to a member of the board in connection
with the management or investment of state funds.
(d)
Financial analysts or service providers
described by Government Code §2263.004 must report any relationship or
pecuniary interest described in subsection (c) of this section in writing
to the executive administrator or designated representative, without regard
to whether the relationship is a direct, indirect, personal, private, commercial,
or business relationship.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on February 28, 2007.
TRD-200700795
Wendall Corrigan Braniff
General Counsel
Texas Water Development Board
Proposed date of adoption: April 24, 2007
For further information, please call: (512) 475-2052