By: Thompson of Harris, Bonnen, Goldman, H.B. No. 15       Coleman, Meyer, et al.     A BILL TO BE ENTITLED   AN ACT   relating to the creation of the Brain Institute of Texas; granting   authority to issue bonds.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subtitle H, Title 3, Education Code, is amended   by adding Chapter 157 to read as follows:   CHAPTER 157. BRAIN INSTITUTE OF TEXAS   SUBCHAPTER A. GENERAL PROVISIONS          Sec. 157.001.  DEFINITIONS. In this chapter:                (1)  "Higher education advisory committee" means the   Brain Institute of Texas Higher Education Advisory Committee.                (2)  "Institute" means the Brain Institute of Texas.                (3)  "Oversight committee" means the Brain Institute of   Texas Oversight Committee.                (4)  "Peer review committee" means the Brain Institute   of Texas Peer Review Committee.                (5)  “Program integration committee” means the Brain   Institute of Texas Program Integration Committee.                (6)  "Research plan" means the Texas Brain Health and   Research Plan developed by the institute.          Sec. 157.002.  PURPOSES. The Brain Institute of Texas is   established to:                (1)  create and expedite innovation in brain research   to improve the health of residents of this state, enhance the   potential for a medical or scientific breakthrough in brain-related   sciences and biomedical research, and enhance the brain research   superiority of this state;                (2)  attract, create, or expand research capabilities   of eligible institutions of higher education by awarding grants to   the institutions to promote a substantial increase in brain   research, strategies for prevention of brain-related diseases,   brain health initiatives, and the creation of jobs in this state;   and                (3)  develop and implement a research plan to foster   synergistic collaboration and investigation into brain health and   research by eligible institutions of higher education and their   partners.          Sec. 157.003.  SUNSET PROVISION. The Brain Institute of   Texas is subject to Chapter 325, Government Code (Texas Sunset   Act). Unless continued in existence as provided by that chapter,   the institute is abolished and this chapter expires September 1,   2032.   SUBCHAPTER B. POWERS AND DUTIES OF INSTITUTE          Sec. 157.051.  POWERS AND DUTIES. (a) The institute:                (1)  may make grants to further the purposes of this   chapter, including:                      (A)  implementing the research plan;                      (B)  researching:                            (i)  the causes of and prevention,   treatment, rehabilitation, and cures for brain-related diseases,   syndromes, disorders, dysfunction, injuries, developmental issues,   neurological health issues, mental and behavioral health issues,   and substance abuse disorders and other addictions; and                            (ii)  any other area impacting the brain,   including an area that directly or indirectly impacts or is   impacted by the brain or brain health, such as the gut microbiome,   nutrition, and the spinal cord or nervous system, that the peer   review committee and the oversight committee approve;                      (C)  providing money for facilities, equipment,   supplies, salaries, benefits, and other costs related to brain   research; and                      (D)  establishing prevention programs and   strategies to mitigate the incidence of detrimental health impacts   on the brain;                (2)  shall collaborate with relevant state agencies,   coordinating councils, and consortiums to enhance brain-related   health care and research;                (3)  may establish appropriate standards and oversight   bodies to ensure money authorized under this chapter is properly   used for the purposes of this chapter;                (4)  may employ necessary staff to provide   administrative support to the institute;                (5)  shall monitor grant contracts and agreements   authorized under this chapter to ensure each grant recipient   complies with the terms and conditions of the contract or   agreement;                (6)  shall ensure that all grant proposals comply with   this chapter and rules adopted under this chapter before the   proposals are submitted to the oversight committee for approval;                (7)  shall establish procedures to document that the   institute, its employees, and any committee members appointed under   this chapter comply with all rules governing conflicts of interest   and the peer review process developed under Section 157.252; and                (8)  shall create a statewide research and clinical   data registry for brain research.          (b)  The institute shall establish a program integration   committee composed of:                (1)  the institute's chief executive officer;                (2)  three senior-level institute employees   responsible for program policy and oversight appointed by the chief   executive officer, with the approval of a simple majority of the   members of the oversight committee; and                (3)  the executive commissioner of the Health and Human   Services Commission or the executive commissioner’s designee.          (c)  The institute's chief executive officer shall serve as   the presiding officer of the program integration committee.          (d)  The program integration committee has the duties   assigned under this chapter.          (e)  The institute shall implement and monitor the research   plan and revise the plan as necessary.          Sec. 157.052.  CHIEF EXECUTIVE OFFICER; CHIEF COMPLIANCE   OFFICER; ADDITIONAL OFFICERS. (a) The oversight committee shall   hire a chief executive officer. The chief executive officer shall   perform the duties required under this chapter or designated by the   oversight committee. The chief executive officer must have a   demonstrated ability to lead and develop academic, commercial, and   governmental partnerships and coalitions.          (b)  The institute shall employ a chief compliance officer to   monitor compliance with this chapter and rules adopted under this   chapter and report incidents of noncompliance to the oversight   committee. The chief compliance officer shall:                (1)  ensure that all grant proposals comply with this   chapter and rules adopted under this chapter before the proposals   are submitted to the oversight committee for consideration and   approval; and                (2)  attend and observe peer review committee meetings   to ensure compliance with this chapter and rules adopted under this   chapter.          (c)  The chief compliance officer may appoint as the   officer's designee another institute employee to attend and observe   one or more peer review committee meetings to ensure compliance   with this chapter and rules adopted under this chapter if the chief   compliance officer is unable to attend the meeting.          (d)  The chief executive officer may hire any other officer   position the chief executive officer determines necessary for   efficient operation of the institute.          Sec. 157.053.  ANNUAL REPORT; INTERNET POSTING. Not later   than January 31 of each year, the institute shall prepare and submit   to the governor, the lieutenant governor, the speaker of the house   of representatives, and each standing committee of the legislature   having primary jurisdiction over institute matters and post on the   institute's Internet website a written report that outlines:                (1)  the institute's activities under this chapter;                (2)  a list of grant recipients during the preceding   state fiscal year, including the grant amount awarded to each   recipient;                (3)  any research accomplishments made during the   preceding state fiscal year by a grant recipient or the recipient's   partners;                (4)  an overview summary of the institute's financial   records and strategies;                (5)  an assessment of the relationship between the   institute's grants and the strategy of its research program;                (6)  a statement of the institute's strategic research   plans;                (7)  an estimate of the amount of money brain disease   has cost this state during the most recent state fiscal year for   which data is available, including the amounts spent by this state   relating to brain disease by the Medicaid program, the Teacher   Retirement System of Texas, and the Employees Retirement System of   Texas;                (8)  a statement of the institute's compliance program   activities, including any proposed legislation or other   recommendations identified through the activities;                (9)  for the preceding state fiscal year:                      (A)  a list of any conflicts of interest under   this chapter or rules adopted under this chapter;                      (B)  any conflicts of interest that require   recusal under Section 157.107;                      (C)  any unreported conflicts of interest   confirmed by an investigation conducted under Section 157.109,   including any actions taken by the institute regarding an   unreported conflict of interest and subsequent investigation; and                      (D)  any waivers granted through the process   established under Section 157.108; and                (10)  the institute's future direction.          Sec. 157.054.  INDEPENDENT FINANCIAL AUDIT FOR REVIEW BY   COMPTROLLER. (a) The institute shall annually commission an   independent financial audit of its activities from a certified   public accounting firm. The institute shall provide the audit to   the comptroller.          (b)  The comptroller shall review and evaluate the audit and   annually issue a public report of that review.          (c)  The oversight committee shall review the annual   financial audit, the comptroller's report and evaluation of that   audit, and the financial practices of the institute.          Sec. 157.055.  GRANT RECORDS. (a)  The institute shall   maintain complete records of:                (1)  the review of each grant application submitted to   the institute, including the score assigned to each grant   application reviewed by the peer review committee in accordance   with rules adopted under Section 157.253, regardless of whether the   grant application is not funded by the institute or is withdrawn   after submission to the institute;                (2)  each grant recipient's financial reports;                (3)  each grant recipient's progress reports; and                (4)  the institute's review of the grant recipient's   financial and progress reports.          (b)  The institute shall keep the records described by   Subsection (a) for at least 15 years.          Sec. 157.056.  GIFTS AND GRANTS. The institute may solicit   and accept gifts and grants from any source for the purposes of this   chapter.          Sec. 157.057.  PROHIBITED OFFICE LOCATION.  An institute   employee may not have an office located in a facility owned by an   entity receiving or applying to receive money from the institute.   SUBCHAPTER C. OVERSIGHT COMMITTEE          Sec. 157.101.  COMPOSITION OF OVERSIGHT COMMITTEE. (a) The   oversight committee is the governing body of the institute.          (b)  The oversight committee is composed of the following   nine members:                (1)  three members appointed by the governor;                (2)  three members appointed by the lieutenant   governor; and                (3)  three members appointed by the speaker of the   house of representatives.          (c)  A person may not be a member of the oversight committee   if the person or the person's spouse:                (1)  is employed by or participates in the management   of an entity or collaborative partner receiving money from the   institute;                (2)  owns or controls, directly or indirectly, an   interest in an entity or collaborative partner receiving money from   the institute; or                (3)  uses or receives a substantial amount of tangible   goods, services, or money from the institute, other than   reimbursement authorized by this chapter for oversight committee   membership, attendance, or expenses.          Sec. 157.102.  REMOVAL. (a) It is a ground for removal from   the oversight committee that a member:                (1)  is ineligible for membership under Section   157.101(c);                (2)  cannot, because of illness or disability,   discharge the member's duties for a substantial part of the member's   term; or                (3)  is absent from more than half of the regularly   scheduled oversight committee meetings that the member is eligible   to attend during a calendar year without an excuse approved by a   majority vote of the committee.          (b)  The validity of an action of the oversight committee is   not affected by the fact that it is taken when a ground for removal   of a committee member exists.          (c)  If the institute's chief executive officer has   knowledge that a potential ground for removal exists, the chief   executive officer shall notify the presiding officer of the   oversight committee of the potential ground. The presiding officer   shall then notify the appointing authority and the attorney general   that a potential ground for removal exists. If the potential ground   for removal involves the presiding officer, the chief executive   officer shall notify the next highest ranking officer of the   oversight committee, who shall then notify the appointing authority   and the attorney general that a potential ground for removal   exists.          Sec. 157.103.  TERMS; VACANCY. (a) Oversight committee   members serve at the pleasure of the appointing authority for   staggered six-year terms, with the terms of three members expiring   January 31 of each even-numbered year.          (b)  If a vacancy occurs on the oversight committee, the   appropriate appointing authority shall appoint a successor in the   same manner as the original appointment to serve for the remainder   of the unexpired term. The appropriate appointing authority shall   appoint the successor not later than the 30th day after the date the   vacancy occurs.          Sec. 157.104.  OFFICERS. (a) The oversight committee shall   elect a presiding officer and assistant presiding officer from   among its members every two years. The oversight committee may   elect additional officers from among its members.          (b)  The presiding officer and assistant presiding officer   may not serve in the position to which the officer was elected for   consecutive terms.          (c)  The oversight committee shall:                (1)  establish and approve duties and responsibilities   for officers of the committee; and                (2)  develop and implement policies that distinguish   the responsibilities of the oversight committee and the committee's   officers from the responsibilities of the chief executive officer   and institute employees.          Sec. 157.105.  EXPENSES. A member of the oversight   committee is not entitled to compensation but is entitled to   reimbursement for actual and necessary expenses incurred in   attending meetings of the committee or performing other official   duties authorized by the presiding officer.          Sec. 157.106.  CONFLICT OF INTEREST. (a)  The oversight   committee shall adopt conflict-of-interest rules, based on   standards adopted by the National Institutes of Health, to govern   members of the oversight committee, the program integration   committee, the peer review committee, and institute employees.          (b)  An institute employee, oversight committee member,   program integration committee member, or peer review committee   member shall recuse himself or herself, as provided by Section   157.107(a), (b), or (c), as applicable, if the employee or member,   or a person who is related to the employee or member within the   second degree of affinity or consanguinity, has a professional or   financial interest in an entity receiving or applying to receive   money from the institute.          (c)  A person has a professional interest in an entity   receiving or applying to receive money from the institute if the   person:                (1)  is a member of the board of directors, another   governing board, or any committee of the entity, or of a foundation   or similar organization affiliated with the entity, during the same   grant cycle;                (2)  serves as an elected or appointed officer of the   entity;                (3)  is an employee of or is negotiating future   employment with the entity;                (4)  represents the entity;                (5)  is a professional associate of a primary member of   the entity's project team;                (6)  is, or within the preceding six years has been, a   student, postdoctoral associate, or part of a laboratory research   group for a primary member of the entity's project team; or                (7)  is engaged or is actively planning to be engaged in   collaboration with a primary member of the entity's project team.          (d)  A person has a financial interest in an entity receiving   or applying to receive money from the institute if the person:                (1)  owns or controls, directly or indirectly, an   ownership interest, including sharing in profits, proceeds, or   capital gains, in an entity receiving or applying to receive money   from the institute; or                (2)  could reasonably foresee that an action taken by   the institute, the peer review committee, the program integration   committee, or the oversight committee could result in a financial   benefit to the person.          (e)  Nothing in this chapter limits the authority of the   oversight committee to adopt additional conflict-of-interest   standards.          Sec. 157.107.  DISCLOSURE OF CONFLICT OF INTEREST; RECUSAL.   (a)  If an oversight committee member or program integration   committee member has a conflict of interest as described by Section   157.106 regarding an application that comes before the member for   review or other action, the member shall:                (1)  provide written notice to the chief executive   officer and the presiding officer of the oversight committee or the   next ranking member of the committee if the presiding officer has   the conflict of interest;                (2)  disclose the conflict of interest in an open   meeting of the oversight committee; and                (3)  recuse himself or herself from participating in   the review, discussion, deliberation, and vote on the application   and from accessing information regarding the matter to be decided.          (b)  If an institute employee has a conflict of interest   described by Section 157.106 regarding an application that comes   before the employee for review or other action, the employee shall:                (1)  provide written notice to the chief executive   officer of the conflict of interest; and                (2)  recuse himself or herself from participating in   the review of the application and be prevented from accessing   information regarding the matter to be decided.          (c)  If a peer review committee member has a conflict of   interest described by Section 157.106 regarding an application that   comes before the member's committee for review or other action, the   member shall:                (1)  provide written notice to the chief executive   officer of the conflict of interest; and                (2)  recuse himself or herself from participating in   the review, discussion, deliberation, and vote on the application   and from accessing information regarding the matter to be decided.          (d)  An oversight committee member, program integration   committee member, peer review committee member, or institute   employee with a conflict of interest may seek a waiver as provided   by Section 157.108.          (e)  An oversight committee member, program integration   committee member, peer review committee member, or institute   employee who reports a potential conflict of interest or another   impropriety or self-dealing of the member or employee and who fully   complies with the recommendations of the general counsel and   recusal requirements is considered in compliance with the   conflict-of-interest provisions of this chapter.  The member or   employee is subject to other applicable laws, rules, requirements,   and prohibitions.          (f)  An oversight committee member, program integration   committee member, peer review committee member, or institute   employee who intentionally violates this section is subject to   removal from further participation in the institute's grant review   process.          Sec. 157.108.  EXCEPTIONAL CIRCUMSTANCES REQUIRING   PARTICIPATION.  The oversight committee shall adopt rules governing   the waiver of the conflict-of-interest requirements of this chapter   under exceptional circumstances for an oversight committee member,   program integration committee member, peer review committee   member, or institute employee.  The rules must:                (1)  authorize the chief executive officer or an   oversight committee member to propose the granting of a waiver by   submitting to the presiding officer of the oversight committee a   written statement about the conflict of interest, the exceptional   circumstance requiring the waiver, and any proposed limitations to   the waiver;                (2)  require a proposed waiver to be publicly reported   at a meeting of the oversight committee;                (3)  require a majority vote of the oversight committee   members present and voting to grant a waiver;                (4)  require any waiver granted to be reported annually   to the lieutenant governor, the speaker of the house of   representatives, the governor, and the standing committee of each   house of the legislature with primary jurisdiction over institute   matters; and                (5)  require the institute to retain documentation of   each waiver granted.          Sec. 157.109.  INVESTIGATION OF UNREPORTED CONFLICTS OF   INTEREST. (a)  An oversight committee member, a program   integration committee member, a peer review committee member, or an   institute employee who becomes aware of a potential conflict of   interest described by Section 157.106 that has not been reported   shall immediately notify the chief executive officer of the   potential conflict of interest.  On notification, the chief   executive officer shall notify the presiding officer of the   oversight committee and the general counsel, who shall determine   the nature and extent of any unreported conflict.          (b)  A grant applicant seeking an investigation regarding   whether a prohibited conflict of interest was not reported shall   file a written request with the institute's chief executive   officer. The applicant must:                (1)  include in the request all facts regarding the   alleged conflict of interest; and                (2)  submit the request not later than the 30th day   after the date the chief executive officer presents final funding   recommendations for the affected grant cycle to the oversight   committee.          (c)  On notification of an alleged conflict of interest under   Subsection (a) or (b), the institute's general counsel shall:                (1)  investigate the matter; and                (2)  provide to the chief executive officer and   presiding officer of the oversight committee an opinion that   includes:                      (A)  a statement of facts;                      (B)  a determination of whether a conflict of   interest or another impropriety or self-dealing exists; and                      (C)  if the opinion provides that a conflict of   interest or another impropriety or self-dealing exists,   recommendations for an appropriate course of action.          (d)  If the conflict of interest, impropriety, or   self-dealing involves the presiding officer of the oversight   committee, the institute's general counsel shall provide the   opinion to the next ranking oversight committee member who is not   involved with the conflict of interest, impropriety, or   self-dealing.          (e)  After receiving the opinion and consulting with the   presiding officer of the oversight committee, the chief executive   officer shall take action regarding the recusal of the individual   from any discussion of or access to information related to the   conflict of interest or other recommended action related to the   impropriety or self-dealing.  If the alleged conflict of interest,   impropriety, or self-dealing is held by, or is an act of, the chief   executive officer, the presiding officer of the oversight committee   shall take actions regarding the recusal or other action.          Sec. 157.110.  FINAL DETERMINATION OF UNREPORTED CONFLICT OF   INTEREST. (a)  The chief executive officer or, if applicable, the   presiding officer of the oversight committee shall make a   determination regarding the existence of an unreported conflict of   interest described by Section 157.109 or other impropriety or   self-dealing.  The determination must specify any actions to be   taken to address the conflict of interest, impropriety, or   self-dealing, including:                (1)  reconsideration of the application; or                (2)  referral of the application to another peer review   committee for review.          (b)  The determination made under Subsection (a) is   considered final unless three or more oversight committee members   request that the issue be added to the agenda of the oversight   committee.          (c)  The chief executive officer or, if applicable, the   presiding officer of the oversight committee, shall provide written   notice of the final determination, including any further actions to   be taken, to the grant applicant requesting the investigation.          (d)  Unless specifically determined by the chief executive   officer, if applicable, the presiding officer of the oversight   committee, or the oversight committee, the validity of an action   taken on a grant application is not affected by the fact that an   individual who failed to report a conflict of interest participated   in the action.          Sec. 157.111.  RULEMAKING AUTHORITY. The oversight   committee may adopt rules to administer this chapter.          Sec. 157.112.  POWERS AND DUTIES. The oversight committee   shall:                (1)  hire a chief executive officer;                (2)  annually set priorities as prescribed by the   legislature for each grant project that receives money under this   chapter; and                (3)  consider the priorities set under Subdivision (2)   in awarding grants under this chapter.          Sec. 157.113.  CODE OF CONDUCT. The oversight committee   shall adopt a code of conduct applicable to each member of the   oversight committee, the program integration committee, and the   peer review committee and each institute employee.          Sec. 157.114.  FINANCIAL STATEMENT REQUIRED. Each member of   the oversight committee shall file with the chief compliance   officer a verified financial statement complying with Sections   572.022 through 572.0252, Government Code, as required of a state   officer by Section 572.021, Government Code.   SUBCHAPTER D. OTHER INSTITUTE COMMITTEES          Sec. 157.151.  PEER REVIEW COMMITTEE. (a) The oversight   committee shall establish the peer review committee. The chief   executive officer, with approval by a simple majority of the   members of the oversight committee, shall appoint as members of the   peer review committee experts in fields related to the brain,   including research, health care, disease treatment and prevention,   and other study areas.          (b)  The oversight committee shall adopt a written policy on   in-state or out-of-state residency requirements for peer review   committee members.          (c)  A peer review committee member may receive an   honorarium. Subchapter B, Chapter 2254, Government Code, does not   apply to an honorarium the member receives under this chapter.          (d)  The chief executive officer, in consultation with the   oversight committee, shall adopt a policy regarding honoraria and   document any change in the amount of honoraria paid to a member of   the peer review committee, including information explaining the   basis for that change.          (e)  A member of the peer review committee appointed under   this chapter may not serve on the board of directors or other   governing board of an entity or the entity’s collaborator receiving   a grant from the institute.          (f)  Members of the peer review committee serve for terms as   determined by the chief executive officer.          Sec. 157.152.  HIGHER EDUCATION ADVISORY COMMITTEE. (a)   The higher education advisory committee is composed of the   following members:                (1)  one member appointed by the president of Baylor   College of Medicine;                (2)  one member appointed by the president of Texas A&M   University Health Science Center;                (3)  one member appointed by the president of Texas   Tech University Health Sciences Center;                (4)  one member appointed by the president of Texas   Tech University Health Sciences Center at El Paso;                (5)  one member appointed by the president of The   University of Texas Southwestern Medical Center;                (6)  one member appointed by the president of The   University of Texas Medical Branch at Galveston;                (7)  one member appointed by the president of The   University of Texas Health Science Center at Houston;                (8)  one member appointed by the president of The   University of Texas Health Science Center at San Antonio;                (9)  one member appointed by the president of The   University of Texas Health Science Center at Tyler;                (10)  one member appointed by the dean of Dell Medical   School at The University of Texas at Austin;                (11)  one member appointed by the president of The   University of Texas M. D. Anderson Cancer Center;                (12)  one member appointed by the dean of The   University of Texas Rio Grande Valley School of Medicine;                (13)  one member appointed by the president of   University of North Texas Health Science Center at Fort Worth;                (14)  one member appointed by the dean of University of   Houston College of Medicine; and                (15)  one member appointed by the dean of Sam Houston   State University College of Osteopathic Medicine.          (b)  The higher education advisory committee shall advise   the oversight committee, the program integration committee, and the   peer review committee on issues, opportunities, the role of higher   education, and other subjects involving brain research.          Sec. 157.153.  AD HOC ADVISORY COMMITTEE. (a) The oversight   committee, as necessary, may create additional ad hoc advisory   committees of experts to advise the oversight committee and the   peer review committee on issues relating to brain research, brain   health, brain-related diseases, spinal cord injuries, traumatic   brain injuries, mental and behavioral health issues, including   substance abuse disorders and other addictions, or other brain- or   neurological-related issues.          (b)  Ad hoc committee members shall serve for the terms   determined by the oversight committee.   SUBCHAPTER E. FUNDING          Sec. 157.201.  BRAIN INSTITUTE OF TEXAS RESEARCH FUND. (a)   The Brain Institute of Texas research fund is a dedicated account in   the general revenue fund.          (b)  The Brain Institute of Texas research fund consists of:                (1)  appropriations of money to the fund by the   legislature, except that the appropriated money does not include   the proceeds from the issuance of bonds authorized by Section 68,   Article III, Texas Constitution;                (2)  gifts and grants, including grants from the   federal government, and other donations received for the fund; and                (3)  interest earned on the investment of money in the   fund.          (c)  The fund may only be used for:                (1)  the award of grants authorized under this chapter,   including grants for brain research and for research facilities in   this state to conduct brain research;                (2)  the purchase, subject to approval by the oversight   committee, of research facilities by or for a grant recipient;                (3)  the operation of the institute;                (4)  debt service on bonds issued as authorized by   Section 68, Article III, Texas Constitution; and                (5)  the payment of the costs of issuing the bonds and   related bond administration costs of the Texas Public Finance   Authority.          Sec. 157.202.  ISSUANCE OF GENERAL OBLIGATION BONDS.  (a)     The institute may request the Texas Public Finance Authority to   issue and sell general obligation bonds of the state as authorized   by Section 68, Article III, Texas Constitution.          (b)  The Texas Public Finance Authority may not issue and   sell general obligation bonds authorized by this section before   January 1, 2022, and may not issue and sell more than $300 million   in general obligation bonds authorized by this section in a state   fiscal year.          (c)  The institute shall determine, and include in its   request for issuing bonds, the amount, exclusive of costs of   issuance, of the bonds to be issued and the preferred time for   issuing the bonds.          (d)  The Texas Public Finance Authority shall issue the bonds   in accordance with and subject to Chapter 1232, Government Code,   and Texas Public Finance Authority rules. The bonds may be issued in   installments.          (e)  Proceeds of the bonds issued under this section shall be   deposited to the credit of the Brain Institute of Texas research   fund and used only for the purposes authorized under Section   157.201.          Sec. 157.203.  AUTHORIZED USE OF GRANT MONEY. (a) A grant   recipient awarded money from the Brain Institute of Texas research   fund established under Section 157.201 may use the money for   research consistent with the purposes of this chapter and in   accordance with a contract between the grant recipient and the   institute.          (b)  Money awarded under this chapter may be used for   authorized expenses, including honoraria, salaries and benefits,   travel, conference fees and expenses, consumable supplies, other   operating expenses, contracted research and development, capital   equipment, and construction or renovation of state or private   facilities.          (c)  Not more than five percent of the money awarded under   this subchapter in a state fiscal year may be used for facility   purchase, construction, remodel, or renovation purposes during   that year. Expenditures of money awarded under this subchapter for   facility purchase, construction, remodel, or renovation projects   must benefit brain research.          (d)  Not more than 10 percent of the money appropriated by   the legislature for grants in a state fiscal year may be used for   prevention projects and strategies to mitigate the incidence of   detrimental health impacts on the brain during that year.          Sec. 157.204.  PREFERENCE FOR TEXAS BUSINESSES. If the   Texas Public Finance Authority contracts with a private entity to   issue bonds under this subchapter, the Texas Public Finance   Authority shall consider:                (1)  contracting with an entity that has its principal   place of business in this state; and                (2)  using a historically underutilized business as   defined by Section 2161.001, Government Code.   SUBCHAPTER F. PROCEDURE FOR AWARDING GRANTS          Sec. 157.251.  ELIGIBLE GRANT RECIPIENTS. (a) A public or   private institution of higher education in this state, including   any institution of higher education under Section 61.003, is   eligible for a grant award under this chapter.          (b)  A grant recipient may use the money received from a   grant awarded under this chapter for purposes of this chapter and in   a collaborative partnership with:                (1)  another eligible institution in this state,   including a historically black college or university;                (2)  a nonprofit or for-profit organization in this   state;                (3)  a health care organization in this state;                (4)  a branch of the United States armed forces for a   project based in this state;                (5)  a private company in this state;                (6)  a federal, state, or local government for a   project based in this state; or                (7)  another relevant person or organization in this   state.          Sec. 157.252.  AWARD REVIEW PROCESS. The institute shall   use a peer review process to evaluate and recommend all grants   awarded by the oversight committee under this chapter.          Sec. 157.253.  GRANT AWARD RULES AND PROCEDURES. (a) The   oversight committee shall adopt rules establishing procedures for   awarding grants under Subchapter E. The rules must require:                (1)  the peer review committee to score grant   applications and make recommendations to the program integration   committee and the oversight committee regarding the award of   grants, including the creation of a prioritized list that:                      (A)  ranks the grant applications in the order the   peer review committee determines applications should be funded; and                      (B)  includes information explaining the reasons   each grant application on the list meets the peer review   committee's standards for recommendation; and                (2)  the program integration committee to submit to the   oversight committee a list of grant applications the program   integration committee by majority vote approved for recommendation   that:                      (A)  includes documentation on the factors the   program integration committee considered in making the grant   recommendations;                      (B)  is substantially based on the list submitted   by the peer review committee under Subdivision (1); and                      (C)  to the extent possible, gives priority to   proposals that:                            (i)  align with the research plan;                            (ii)  align with state priorities and needs,   including priorities and needs outlined in other state agency   strategic plans, or address federal or other major research   sponsors' priorities in scientific or technological fields in the   area of brain research;                            (iii)  enhance the research superiority at   eligible institutions of higher education by creating new research   superiority, attracting existing research superiority, or   enhancing existing research superiority;                            (iv)  benefit the residents of this state,   including a demonstrable economic or job creation benefit to this   state; and                            (v)  if applicable, are interdisciplinary or   interinstitutional, or have collaborators or partnerships.          (b)  A member of a peer review committee may not attempt to   use the committee member's official position to influence a   decision to approve or award a grant or contract to the committee   member's employer.          (c)  The chief executive officer shall submit a written   affidavit for each grant application recommendation included on the   list submitted to the oversight committee under Subsection (a)(2).   The affidavit must contain all relevant information on:                (1)  the peer review process for the grant application;   and                (2)  the application's peer review score assigned by   the peer review committee.          (d)  A member of the program integration committee may not   discuss a grant applicant recommendation with a member of the   oversight committee unless the chief executive officer and the   program integration committee have fulfilled the requirements of   Subsections (a)(2) and (c), as applicable.          (e)  Two-thirds of the members of the oversight committee   present and voting must vote to approve each funding recommendation   made by the program integration committee. If the oversight   committee does not approve a funding recommendation made by the   program integration committee, a statement explaining the reasons   the funding recommendation was not followed must be included in the   minutes of the meeting.          (f)  The oversight committee may not award more than $300   million in grants under this chapter in a state fiscal year.          (g)  The institute may not award a grant to an applicant who   has made a gift or grant with a value that exceeds $50 to the   institute, an oversight committee member, or an institute employee   on or after January 1, 2022. The oversight committee may waive this   exclusion under rules adopted under Section 157.108.          Sec. 157.254.  MULTIYEAR PROJECTS. (a) The oversight   committee may award grant money for a multiyear project.           (b)  If the oversight committee awards grant money to fund   the multiyear project, the committee must specify the total amount   of that money awarded in the state fiscal year that the project is   approved. The institute shall distribute only the amount of grant   money that the grant recipient will spend during that fiscal year.   The institute shall distribute the remaining grant money as the   grant recipient needs in each subsequent state fiscal year.          Sec. 157.255.  CONTRACT TERMS. (a) Before awarding a grant   under this chapter, the institute shall enter into a written   contract with the grant recipient. The contract may specify that:                (1)  except for awards to state agencies or public   institutions of higher education, if all or any portion of the   amount of the grant is used to build a capital improvement:                      (A)  the state retains a lien or other interest in   the capital improvement in proportion to the percentage of the   grant amount used to pay for the capital improvement; and                      (B)  the grant recipient shall, if the capital   improvement is sold:                            (i)  repay to the state the grant money used   to pay for the capital improvement, with interest at the rate and   according to the other terms provided by the contract; and                            (ii)  share with the state a proportionate   amount of any profit realized from the sale;                (2)  if the grant recipient does not use grant money   awarded under Subchapter E for the purposes approved by the   oversight committee, the recipient shall repay to this state that   amount and any related interest applicable under the grant contract   at the agreed rate and on the agreed terms; and                (3)  if the grant recipient fails to meet the terms and   conditions of the contract, the institute may terminate the   contract using the written process prescribed in the contract and   require the recipient to repay to this state the grant money awarded   under Subchapter E and any related interest applicable under the   contract at the agreed rate and on the agreed terms.          (b)  The oversight committee shall adopt rules to administer   this section.          Sec. 157.256.  PATENT ROYALTIES AND LICENSE REVENUES. (a)   The oversight committee shall establish standards requiring all   grant awards to be subject to an intellectual property agreement   that allows this state to collect royalties, income, and other   benefits, including interest or proceeds resulting from securities   and equity ownership, realized as a result of projects undertaken   with money awarded under Subchapter E. The oversight committee may   exempt state agencies and public institutions of higher education   from the standards.          (b)  In determining this state's interest in any   intellectual property rights and revenue sharing, the oversight   committee shall balance the opportunity of this state to benefit   from the patents, royalties, licenses, and other benefits that   result from basic research, therapy development, and clinical   trials with the need to ensure that essential medical research is   not unreasonably hindered by the intellectual property agreement   and that the agreement does not unreasonably remove the incentive   on the part of the individual researcher, research team, or   institution.          (c)  The oversight committee may transfer its management and   disposition authority over this state's interest in securities,   equities, royalties, income, and other benefits realized as a   result of projects undertaken with money awarded under Subchapter E   to the Texas Treasury Safekeeping Trust Company. If the oversight   committee transfers management and disposition authority to the   trust company, the company has all powers necessary to accomplish   the purposes of this section.          (d)  In managing the assets described by Subsection (c),   subject to restrictions that the Texas Treasury Safekeeping Trust   Company considers appropriate, the trust company may acquire,   exchange, sell, supervise, manage, or retain any kind of investment   that a prudent investor, exercising reasonable care, skill, and   caution, would acquire, exchange, sell, or retain in light of the   purposes, terms, distribution requirements, and other   circumstances then prevailing pertinent to each investment,   including the requirements prescribed by Subsection (b) and the   purposes described by Section 157.002. The trust company may   charge a fee to recover the reasonable and necessary costs incurred   in managing assets under this section.          Sec. 157.257.  PREFERENCE FOR TEXAS SUPPLIERS. In a good   faith effort to achieve a goal of more than 50 percent of purchases   from suppliers in this state, the oversight committee shall   establish standards to ensure that grant recipients purchase goods   and services from suppliers in this state to the extent reasonably   possible.          Sec. 157.258.  HISTORICALLY UNDERUTILIZED BUSINESSES. The   oversight committee shall establish standards to ensure that grant   recipients purchase goods and services from historically   underutilized businesses as defined by Section 2161.001,   Government Code, and any other applicable state law.          Sec. 157.259.  GRANT COMPLIANCE AND PROGRESS EVALUATION.   (a) The oversight committee shall require as a condition of a grant   awarded under this chapter that the grant recipient submit to   regular reviews of the grant project by institute staff to ensure   compliance with the terms of the grant and to ensure ongoing   progress, including the scientific merit of the research.          (b)  The institute shall establish and implement a grant   compliance and progress review process under this section that   includes reporting requirements to ensure each grant recipient   complies with the terms and conditions of a grant contract.  The   chief executive officer may terminate grants that do not meet   contractual obligations.          (c)  The chief executive officer shall report at least   annually to the oversight committee on the progress and continued   merit of the projects awarded grants by the institute.          (d)  The institute shall implement a system to:                (1)  track the dates grant recipient reports are due   and are received by the institute; and                (2)  monitor the status of any required report not   timely submitted to the institute by a grant recipient.          (e)  The chief compliance officer shall monitor compliance   with this section and shall inquire into and monitor the status of   any required report not timely submitted to the institute by a grant   recipient. The chief compliance officer shall notify the general   counsel for the institute and the oversight committee of a grant   recipient that has not complied with the reporting requirements or   provisions of the grant contract to allow the institute to begin   suspension or termination of the grant contract. This subsection   does not limit other remedies available under the grant contract.          Sec. 157.260.  MEDICAL AND RESEARCH ETHICS. Any project   that is awarded a grant under this chapter must comply with all   applicable federal and state laws regarding the conduct of the   research or prevention project.          Sec. 157.261.  PUBLIC INFORMATION. (a) The following   information is public information and may be disclosed under   Chapter 552, Government Code:                (1)  the applicant's name and address;                (2)  the amount requested in the applicant's grant   proposal;                (3)  the type of brain research to be addressed under   the proposal; and                (4)  any other information the institute designates   with the consent of the grant applicant.          (b)  To protect the actual or potential value of information   submitted to the institute by an applicant for or recipient of an   institute grant, the following information submitted by the   applicant or recipient is confidential and is not subject to   disclosure under Chapter 552, Government Code, or any other law:                (1)  all information, other than the information   required under Subsection (a) that is contained in a grant award   application, peer review evaluation, award contract, or progress   report relating to a product, device, or process, the application   or use of the product, device, or process, and all technological and   scientific information, including computer programs, developed   wholly or partly by a grant applicant or recipient, regardless of   whether patentable or capable of being registered under copyright   or trademark laws, that has a potential for being sold, traded, or   licensed for a fee; and                (2)  the plans, specifications, blueprints, and   designs, including related proprietary information, of a   scientific research and development facility.          (c)  The institute shall post on the institute's Internet   website records that pertain specifically to any gift, grant, or   other consideration provided to the institute, an institute   employee, or a member of the oversight committee, in the employee's   or oversight committee member's official capacity. The posted   information must include each donor's name and the amount and date   of the donation.          Sec. 157.262.  COMPLIANCE PROGRAM; CONFIDENTIAL   INFORMATION. (a) In this section, "compliance program" means a   process to assess and ensure compliance by the institute's   committee members and employees with applicable laws, rules, and   policies, including matters of:                (1)  ethics and standards of conduct;                (2)  financial reporting;                (3)  internal accounting controls; and                (4)  auditing.          (b)  The institute shall establish a compliance program that   operates under the direction of the institute's chief compliance   officer.  The institute may establish procedures, including a   telephone hotline, to allow private access to the compliance   program office and to preserve the confidentiality of   communications and the anonymity of a person making a compliance   report or participating in a compliance investigation.          (c)  The following information is confidential and not   subject to disclosure under Chapter 552, Government Code:                (1)  information that directly or indirectly reveals   the identity of an individual who made a report to the institute's   compliance program office, sought guidance from the office, or   participated in an investigation conducted under the compliance   program;                (2)  information that directly or indirectly reveals   the identity of an individual who is alleged to have or may have   planned, initiated, or participated in activities that are the   subject of a report made to the office if, after completing an   investigation, the office determines the report to be   unsubstantiated or without merit; and                (3)  other information that is collected or produced in   a compliance program investigation if releasing the information   would interfere with an ongoing compliance investigation.          (d)  Subsection (c) does not apply to information related to   an individual who consents to disclosure of the information.          (e)  Information made confidential or excepted from public   disclosure by this section may be made available to the following on   request in compliance with applicable laws and procedures:                (1)  a law enforcement agency or prosecutor;                (2)  a governmental agency responsible for   investigating a matter that is the subject of a compliance report,   including the Texas Workforce Commission civil rights division or   the federal Equal Employment Opportunity Commission; or                (3)  a committee member or institute employee who is   responsible under institutional policy for a compliance program   investigation or for a review of a compliance program   investigation.          (f)  A disclosure under Subsection (e) is not a voluntary   disclosure for purposes of Section 552.007, Government Code.          Sec. 157.263.  CLOSED MEETING.  The oversight committee may   conduct a closed meeting under Chapter 551, Government Code, to   discuss an ongoing compliance investigation into issues related to   fraud, waste, or abuse of state resources.          Sec. 157.264.  APPROPRIATION CONTINGENCY. The institute is   required to implement a provision of this chapter only if the   legislature appropriates money specifically for that purpose. If   the legislature does not appropriate money specifically for that   purpose, the institute may, but is not required to, implement the   provision using other money available to the institute for that   purpose.          SECTION 2.  Section 51.955(c), Education Code, is amended to   read as follows:          (c)  Subsection (b)(1) does not apply to a research contract   between an institution of higher education and the Cancer   Prevention and Research Institute of Texas or Brain Institute of   Texas.          SECTION 3.  Section 61.003(6), Education Code, is amended to   read as follows:                (6)  "Other agency of higher education" means The   University of Texas System, System Administration; The University   of Texas at El Paso Museum; The Texas A&M University System,   Administrative and General Offices; Texas A&M AgriLife Research;   Texas A&M AgriLife Extension Service; Rodent and Predatory Animal   Control Service (a part of the Texas A&M AgriLife Extension   Service); Texas A&M Engineering Experiment Station (including the   Texas A&M Transportation Institute); Texas A&M Engineering   Extension Service; Texas A&M Forest Service; Texas Division of   Emergency Management; Texas Tech University Museum; Texas State   University System, System Administration; Sam Houston Memorial   Museum; Panhandle-Plains Historical Museum; Cotton Research   Committee of Texas; Texas Water Resources Institute; Texas A&M   Veterinary Medical Diagnostic Laboratory; Brain Institute of   Texas; and any other unit, division, institution, or agency which   shall be so designated by statute or which may be established to   operate as a component part of any public senior college or   university, or which may be so classified as provided in this   chapter.          SECTION 4.  (a)  Not later than December 1, 2022, the   appropriate appointing authority shall appoint the members to the   Brain Institute of Texas Oversight Committee as required by Section   157.101, Education Code, as added by this Act. The oversight   committee may not take action until a majority of the appointed   members have taken office.          (b)  Notwithstanding Section 157.101, Education Code, as   added by this Act, in making the initial appointments under that   section, the governor, lieutenant governor, and speaker of the   house of representatives shall, as applicable, designate one member   of the Brain Institute of Texas appointed by that person to serve a   term expiring January 31, 2024, one member appointed by that person   to serve a term expiring January 31, 2026, and one member appointed   by that person to serve a term expiring January 31, 2028.          SECTION 5.  If the constitutional amendment proposed by the   87th Legislature, Regular Session, 2021, authorizing the issuance   of general obligation bonds and the dedication of bond proceeds to   the Brain Institute of Texas established to fund brain research is   approved by the voters, the Brain Institute of Texas established by   Chapter 157, Education Code, as added by this Act, is eligible to   receive funding through the proceeds deposited under the authority   of Section 68, Article III, Texas Constitution, for any activities   conducted by the institute that serve the purposes of that   constitutional provision.          SECTION 6.  This Act takes effect January 1, 2022, but only   if the constitutional amendment proposed by the 87th Legislature,   Regular Session, 2021, authorizing the issuance of general   obligation bonds and the dedication of bond proceeds to the Brain   Institute of Texas established to fund brain research in this state   is approved by the voters. If that amendment is not approved by the   voters, this Act has no effect.