Trust and Transparency – Texas House Bill 1295 and House Bill 23

Texas House Bill 1295 and House Bill 23, passed in 2015, have clearly established rules regarding disclosure of relationships and gift exchanges with local government officials and vendors. These could impact your business if you are directly or indirectly serving governmental markets. HB 1295 creates additional reporting for parties on certain types of contracts with governmental organizations before those contracts can be let. HB23 creates new disclosure requirements around gifts given to governmental entities and certain vendors that those entities employ. Our clients’ interests remain our utmost priority, and we want to make sure you are aware of these laws and how Jones|Carter will be acting upon them.

Jones|Carter has adjusted our internal processes to account for the additional disclosure requirements. We have adopted a conservative approach to giving and receiving gifts that have the potential to fall under the disclosure rules in HB23. We will no longer receive any gifts nor give any gifts without full disclosure. Compliance with the law safeguards everyone involved and permits us to conduct business in an atmosphere of transparency where all are protected. We value your business and appreciate the trust you have put in us over the last 40 years. Jones|Carter will always put our clients first.

Texas House Bill 23.

With a goal to increasing transparency in the award of public projects to private companies, provisions in Texas law have been amended in regard to disclosure reporting requirements. The primary changes include disclosure of personal and familial relationships with local government officers (LGO) and vendors, a lowering of the reporting threshold to $100, and dual disclosure, both from the LGO and the vendor/consultant. Gift amounts are totaled over a rolling 12-month period.

A gift is any consideration of value or a benefit given or accepted including foods, items, lodging, transportation, and entertainment. However, food/drink accepted as a guest does not require disclosure. Cumulative gifts over $100 from one source within a rolling 12-month period are subject to reporting.

Please see the following for more information: http://www.capitol.state.tx.us/BillLookup/History.aspx?LegSess=84R&Bill=HB23

Texas House Bill 1295.

This bill added Section 2252.908 “Disclosure of Interested Parties” to the Texas Local Government Code. This new rule potentially affects all business entities who wish to contract (or amend an existing contract) with a governmental entity. A disclosure of interested parties form (FORM 1295) is required for all contracts approved by a governmental entity’s governing body or that have a value of at least $1 million, including construction contracts, consultant and service contracts, and bond-related contracts. Failure to file a disclosure form will result in the governmental entity’s inability to contract with your business.

The Texas Ethics Commission (Commission) was tasked with the implementation of HB 1295. The Commission created an online platform wherein a business entity may complete a disclosure of interested parties Form 1295. Upon completion, the TEC website will generate a certificate of filing. The certificate and a copy of completed disclosure form must be printed, signed, and provided to the governmental entity with which you are seeking to contract prior to or at the time of the contract’s execution. If the business is unable to file a disclosure and provide the governmental entity with the signed certificate and disclosure form, the governmental entity will be unable to enter into the contract.

Please see the Commission’s website related to the implementation of the bill: https://www.ethics.state.tx.us/whatsnew/elf_info_form1295.htm

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