89R21817 RDS-F     By: Gerdes, Tepper, Metcalf, Hull, H.B. No. 4552       Schatzline     Substitute the following for H.B. No. 4552:     By:  Raymond C.S.H.B. No. 4552       A BILL TO BE ENTITLED   AN ACT   relating to a prohibition on certain discriminatory activities by   governmental entities and vendors of governmental entities;   providing for declaratory and injunctive relief and the withholding   of certain funds from political subdivisions.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  This Act may be cited as the Texas   Antidiscrimination Act.          SECTION 2.  (a)  The Legislature finds that:                (1)  Section 3, Article I, Texas Constitution, provides   that "[a]ll freemen, when they form a social compact, have equal   rights, and no man, or set of men, is entitled to exclusive separate   public emoluments, or privileges, but in consideration of public   services";                (2)  Section 3a, Article I, Texas Constitution,   provides that "[e]quality under the law shall not be denied or   abridged because of sex, race, color, creed, or national origin";                (3)  Section 3a, Article I, Texas Constitution, was   designed expressly to provide protection which supplements the   federal guarantees of equal treatment;                (4)  Section 3a, Article I, Texas Constitution, is more   extensive and provides more specific protection than other equal   protection and due process guarantees included in either the United   States Constitution or the Texas Constitution;                (5)  the discriminatory activities described by   Section 621.051, Government Code, as added by this Act, are   antithetical to Sections 3 and 3a, Article I, Texas Constitution,   and lack a rational relationship to a legitimate governmental   purpose such that the activities violate those sections; and                (6)  Texans deserve a government committed to serving   every person with equal dignity and respect and to expending   precious taxpayer resources only for the purpose of making Texas   great for all Texans.          (b)  The purpose of this Act is to prevent unlawful   discrimination that is antithetical to Sections 3 and 3a, Article   I, Texas Constitution. Nothing in this Act may be construed to   create a right or benefit, substantive or procedural, enforceable   at law or in equity by any party against a governmental entity, as   the term is defined by Section 621.001, Government Code, as added by   this Act, except those specifically provided by Subchapter C,   Chapter 621, Government Code, as added by this Act.          SECTION 3.  Subtitle A, Title 6, Government Code, is amended   by adding Chapter 621 to read as follows:   CHAPTER 621. PROHIBITION ON DISCRIMINATION BY GOVERNMENTAL ENTITY   ON THE BASIS OF IMMUTABLE CHARACTERISTIC   SUBCHAPTER A. GENERAL PROVISIONS          Sec. 621.001.  DEFINITIONS. In this chapter:                (1)  "Discriminatory activity" means:                      (A)  influencing hiring or employment practices   with respect to race, sex, color, or ethnicity, other than through   the use of a color-blind and sex-neutral hiring process in   accordance with any applicable state and federal   antidiscrimination laws;                      (B)  promoting differential treatment of or   providing special benefits to individuals on the basis of race,   sex, color, or ethnicity;                      (C)  promoting policies or procedures designed or   implemented in reference to race, sex, color, or ethnicity, other   than a policy or procedure:                            (i)  approved in writing by:                                  (a)  the general counsel of the   governmental entity promoting the policy or procedure; or                                  (b)  if the governmental entity   promoting the policy or procedure does not employ a general   counsel, an attorney contracted by the entity to provide general   legal services or the attorney general; and                            (ii)  implemented for the sole purpose of   ensuring compliance with any applicable court order or state or   federal law;                      (D)  conducting trainings, programs, or   activities designed or implemented in reference to race, sex,   color, or ethnicity, other than trainings, programs, or activities:                            (i)  developed by an attorney;                            (ii)  approved in writing by:                                  (a)  the general counsel of the   governmental entity conducting the training, program, or activity;   or                                  (b)  if the governmental entity   conducting the training, program, or activity does not employ a   general counsel, an attorney contracted by the entity to provide   general legal services or the attorney general; and                            (iii)  implemented for the sole purpose of   ensuring compliance with any applicable court order or state or   federal law; and                      (E)  promoting, as an official position of a   governmental entity, a particular opinion referencing unconscious   or implicit bias, cultural appropriation, allyship, transgender   ideology, microaggressions, group marginalization, anti-racism,   systemic oppression, intersectionality, neo-pronouns,   heteronormativity, disparate impact, gender theory, racial or   sexual privilege, or any related formulation of those concepts.                (2)  "Discriminatory office" means an office,   division, or other unit of a governmental entity established for   the purpose of engaging in a discriminatory activity.                (3)  "Governmental entity" means a state agency or   political subdivision.                (4)  "Political subdivision" means a county,   municipality, special purpose district, or any other political   subdivision of this state, including a political subdivision   described by Section 2254.021. The term includes an open-enrollment   charter school established under Subchapter D, Chapter 12,   Education Code.                (5)  "State agency" means:                      (A)  a department, commission, board, office, or   other agency in the executive branch of state government that was   created by the constitution or a statute, other than an institution   of higher education as defined by Section 61.003, Education Code;                      (B)  the legislature or a legislative agency; or                      (C)  the supreme court, the court of criminal   appeals, a court of appeals, a district court, or the Texas Judicial   Council or another agency in the judicial branch of state   government.   SUBCHAPTER B. DISCRIMINATION PROHIBITED          Sec. 621.051.  DISCRIMINATION BY GOVERNMENTAL ENTITY   PROHIBITED. (a) Notwithstanding any other law and except as   provided by this section and Section 621.052, a governmental entity   may not:                (1)  engage in a discriminatory activity;                (2)  establish or maintain a discriminatory office;                (3)  hire or assign an employee of the entity or   contract with a third party to perform the duties of a   discriminatory office;                (4)  compel, require, induce, or solicit any person to   provide a discriminatory statement, or give preference to an   employee, applicant for employment, or other participant in any   function of the entity on the basis of the provision of a   discriminatory statement;                (5)  give preference to an employee, applicant for   employment, or other participant in any function of the entity on   the basis of race, sex, color, ethnicity, or national origin;                (6)  promote or adopt any theory justifying   differential treatment of individuals on the basis of race, sex,   color, ethnicity, or national origin;                (7)  consider the race, sex, color, ethnicity, or   national origin of an individual in an employment, contracting,   funding, or policy determination;                (8)  require an employee to participate in a   discriminatory activity or a discriminatory training, including a   training, program, or other activity designed or implemented in   reference to race, sex, color, ethnicity, or national origin;                (9)  spend money on a discriminatory activity,   including acquiring services, supplies, information technology, or   other goods for the purpose of carrying out a discriminatory   activity;                (10)  award a contract or provide preferential or   discriminatory treatment to a person submitting a bid for a   contract on the basis of race, sex, color, ethnicity, or national   origin; or                (11)  enter into or renew a contract with a vendor in   violation of Chapter 2278.          (b)  This section does not apply to a training, program, or   activity relating to sexual harassment or developed for the purpose   of ensuring compliance with applicable federal law.          (c)  Each governmental entity shall adopt policies and   procedures for appropriately disciplining, including by   termination, an employee of the entity who engages in conduct   prohibited by Subsection (a) or Chapter 2278.          Sec. 621.052.  LIMITATION OF PROHIBITION ON CERTAIN   GOVERNMENTAL ACTIVITIES RELATING TO PUBLIC EDUCATION. (a) This   section applies only to:                (1)  a school district;                (2)  an open-enrollment charter school;                (3)  the State Board of Education; and                (4)  the Texas Education Agency.          (b)  Section 621.051:                (1)  may not be construed to:                      (A)  limit or prohibit a school district or   open-enrollment charter school from, in accordance with the   essential knowledge and skills adopted under Subchapter A, Chapter   28, Education Code, acknowledging or teaching the significance of a   state or federal holiday or a commemorative month and the manner in   which the holiday or commemorative month fits into the themes of the   history of this state or the United States;                      (B)  affect a student's rights under the First   Amendment to the United States Constitution or Section 8, Article   1, Texas Constitution; or                      (C)  limit or prohibit a school district or   open-enrollment charter school from analyzing a school-based cause   of, and taking steps to eliminate an unlawful discriminatory   practice necessary to address, achievement gaps and differentials   described by Section 39.053, Education Code; and                (2)  does not apply to:                      (A)  classroom instruction that is consistent   with the essential knowledge and skills adopted under Subchapter A,   Chapter 28, Education Code;                      (B)  the collection, monitoring, or reporting of   data; or                      (C)  a policy, practice, procedure, program, or   activity intended to enhance student academic achievement or   postgraduate outcomes that is designed and implemented without   regard to race, sex, color, or ethnicity.   SUBCHAPTER C. ENFORCEMENT WITH RESPECT TO POLITICAL SUBDIVISION          Sec. 621.101.  COMPLAINT; DESIGNATION AS NONCOMPLIANT   POLITICAL SUBDIVISION. (a) A person who resides in an area served   by a political subdivision and who has a reasonable belief that the   political subdivision is violating this chapter, including by not   complying with the provisions of a corrective action plan included   in a response submitted to the attorney general under Subsection   (c), may file a complaint with the attorney general.          (b)  If the attorney general determines that the political   subdivision named in a complaint received under Subsection (a) is   violating this chapter, the attorney general shall designate the   political subdivision as a noncompliant political subdivision and   provide written notice of the designation to the political   subdivision and the comptroller. The notice provided to the   political subdivision must explain the attorney general's   reasoning for the determination relating to the designation and   provide that the attorney general shall terminate the designation   in accordance with Subsection (c) if the political subdivision   submits a response in the manner provided by that subsection.          (c)  Not later than the 14th day after receiving a notice   described by Subsection (b), a political subdivision may submit a   response to the attorney general. The attorney general shall   terminate the designation of the political subdivision as a   noncompliant political subdivision and provide notice of the   termination of the designation to the political subdivision and the   comptroller if the attorney general determines that the response:                (1)  demonstrates that the political subdivision is not   violating this chapter; or                (2)  includes a corrective action plan appropriate to   cure the violation identified in the notice provided to the   political subdivision under Subsection (b).          Sec. 621.102.  WITHHOLDING OF CERTAIN FUNDS OTHERWISE DUE TO   NONCOMPLIANT POLITICAL SUBDIVISION. (a) With respect to a   municipality that is designated as a noncompliant political   subdivision by the attorney general under Section 621.101, on   receipt of a notice under Section 621.101(b), the comptroller shall   withhold payment of any money owed to the municipality under   Section 183.051(b) or 321.502, Tax Code.          (b)  With respect to a county that is designated as a   noncompliant political subdivision by the attorney general under   Section 621.101, on receipt of a notice under Section 621.101(b),   the comptroller shall withhold payment of any money owed to the   county under Section 183.051(b) or 323.502, Tax Code.          (c)  The comptroller shall place an amount withheld under   Subsection (a) or (b) that is not otherwise placed in a suspense   account in a trust fund outside the state treasury and that money   may not be used for any purpose other than a purpose authorized by   law for that money.          (d)  On receipt of a notice under Section 621.101(c) that the   attorney general has terminated the designation of a municipality   or county as a noncompliant political subdivision, the comptroller   shall:                (1)  immediately send to the municipality or county the   balance of or amount of, as applicable, the money withheld from the   municipality or county under Subsection (a) or (b), as applicable;   and                (2)  resume distribution of the money described by   Subsections (a) and (b) to the municipality or county, as   applicable, in the ordinary course of business.          Sec. 621.103.  CIVIL ACTION. (a) The attorney general may   seek declaratory and injunctive relief, including by filing a   petition for a writ of mandamus, to compel a political subdivision   to comply with this chapter if the political subdivision:                (1)  is designated by the attorney general as a   noncompliant political subdivision under Section 621.101; or                (2)  has not satisfied the terms of a corrective action   plan included in a response submitted to the attorney general under   Section 621.101(c).          (b)  An action brought under this section must be filed in   the county in which the political subdivision is located.          (c)  The court of appeals for the Fifteenth Court of Appeals   District has exclusive intermediate appellate jurisdiction over an   action brought under this section.   SUBCHAPTER D. COMPLIANCE BY STATE AGENCY; REPORTS          Sec. 621.151.  REPORTING BY STATE AGENCY. (a) Each state   agency shall annually report on the agency's compliance with this   chapter in the manner provided by this section.          (b)  A state agency to which Chapter 2102 applies shall   include in the annual report required under Section 2102.009 an   assessment of the agency's compliance with this chapter.          (c)  A state agency not described by Subsection (b) shall:                (1)  not later than November 1 of each year, submit to   the legislature a report containing an assessment of the agency's   compliance with this chapter during the preceding state fiscal   year; and                (2)  appoint an internal auditor for the specific   purpose of conducting the assessment included in the report   described by Subdivision (1).          (d)  A report under this section of a state agency's failure   to comply with this chapter must include a summary of instances of   noncompliance and actions taken or planned to be taken to remedy the   noncompliance.          SECTION 4.  Subtitle F, Title 10, Government Code, is   amended by adding Chapter 2278 to read as follows:   CHAPTER 2278. PROHIBITION ON CONTRACTS WITH COMPANIES THAT ENGAGE   IN DISCRIMINATORY ACTIVITY          Sec. 2278.001.  DEFINITION. In this chapter, "governmental   entity" has the meaning assigned by Section 621.001.          Sec. 2278.002.  PROVISION REQUIRED IN CONTRACT. A   governmental entity may not enter into a contract with a vendor for   goods and services unless the contract:                (1)  contains a written verification from the vendor   that the vendor does not, and will not during the term of the   contract, engage in activity that, were the vendor a governmental   entity, would violate Section 621.051; and                (2)  provides that the governmental entity may   terminate the contract without penalty or further obligation to the   vendor on a showing by the entity that the vendor violated the   verification provided under Subdivision (1).          Sec. 2278.003.  PROHIBITION ON ADDITIONAL CONTRACTS. (a)   Except as provided by Subsection (b), a governmental entity may not   enter into another contract with a vendor after terminating a   contract with that vendor under Section 2278.002(2).          (b)  A governmental entity may enter into a contract with a   vendor described by Subsection (a) only after:                (1)  submitting information to the attorney general   showing that the vendor has cured the violation that was the subject   of the termination described by Section 2278.002(2); and                (2)  receiving authorization from the attorney general   to enter into a subsequent contract.          SECTION 5.  (a)  Not later than January 1, 2026, each state   agency to which Section 621.151(c), Government Code, as added by   this Act, applies shall appoint an internal auditor as required by   that subsection.          (b)  Notwithstanding Section 621.151, Government Code, as   added by this Act, each state agency shall conduct the initial   assessment and report on the agency's compliance with Chapter 621,   Government Code, as added by this Act, in accordance with Section   621.151(b) or (c), Government Code, as added by this Act, as   applicable, not later than November 1, 2026.          SECTION 6.  Chapter 2278, Government Code, as added by this   Act, applies only to a contract for which the request for bids or   proposals or other applicable expression of interest is made public   on or after the effective date of this Act. A contract for which the   request for bids or proposals or other applicable expression of   interest is made public before that date is governed by the law in   effect on the date the request or other expression of interest is   made public, and the former law is continued in effect for that   purpose.          SECTION 7.  Section 621.102, Government Code, as added by   this Act, does not affect the validity of a bond, other obligation,   or contractual obligation for which revenue was pledged or   committed before the effective date of this Act. Bonds, other   obligations, or contractual obligations for which revenue was   pledged or committed before the effective date of this Act are   governed by the law in effect when the revenue was pledged or   committed, and that law is continued in effect for the purposes of   the validity of those bonds, obligations, and contractual   obligations.          SECTION 8.  This Act takes effect immediately if it receives   a vote of two-thirds of all the members elected to each house, as   provided by Section 39, Article III, Texas Constitution.  If this   Act does not receive the vote necessary for immediate effect, this   Act takes effect September 1, 2025.