89R6316 PRL-F     By: Bucy H.B. No. 5352       A BILL TO BE ENTITLED   AN ACT   relating to the establishment of the State Blockchain Technology   Pilot Program by the Department of Information Resources.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Chapter 2054, Government Code, is amended by   adding Subchapter T to read as follows:   SUBCHAPTER T. STATE BLOCKCHAIN TECHNOLOGY PILOT PROGRAM          Sec. 2054.701.  DEFINITIONS. In this subchapter:                (1)  "Blockchain" means a distributed ledger   technology that records transactions in a verifiable and immutable   manner, shared across multiple nodes in a network, ensuring   transparency and security.                (2)  "Program" means the State Blockchain Technology   Pilot Program established under Section 2054.702.                (3)  "Program participant" means the state agency   selected by the governor to participate in the program under   Section 2054.703.          Sec. 2054.702.  ESTABLISHMENT OF PROGRAM. (a) The board   shall establish a pilot program to explore the application and   benefits of the use of blockchain technology by the program   participant for the purpose of improving transparency, security,   and efficiency in government operations.          (b)  The program shall study the use of blockchain by the   program participant:                (1)  to streamline the secure storage and retrieval of   records and documents;                (2)  to improve the transparency of procurement   processes and tracking of goods or services utilized by the program   participant;                (3)  to test secure methods for identity verification   of:                      (A)  employees of the program participant;                      (B)  contractors of the program participant; and                      (C)  citizens that interact with the program   participant;                (4)  to enhance mechanisms for fraud detection and   prevention; and                (5)  for any other application to improve public   services or administrative efficiency, as determined by the program   participant, the governor, or the department.          (c)  In administering the program, the department shall   ensure compliance with cybersecurity and privacy measures.          Sec. 2054.703.  SELECTION OF PROGRAM PARTICIPANT. (a) The   governor shall select a state agency to serve as the program   participant.          (b)  The board shall provide the governor with   recommendations on the selection of the program participant based   on:                (1)  the feasibility of implementing the program by the   program participant;                (2)  the budget appropriated by the legislature to the   department for the program;                (3)  the anticipated disruption to existing services of   the program participant;                (4)  the anticipated efficacy of the program on   existing services of the program participant; and                (5)  cybersecurity and confidentiality concerns.          Sec. 2054.704.  REPORT. (a) Not later than January 1, 2029,   the department shall submit to the governor, lieutenant governor,   and members of the legislature a report documenting the outcomes of   the program. The report must include:                (1)  an evaluation of the benefits and challenges of   implementing blockchain technology in the program participant's   operations;                (2)  an assessment of the cost-effectiveness of the   blockchain solution compared to existing systems of the program   participant;                (3)  a determination of feasibility on whether   blockchain should be expanded to other state agencies or   operations; and                (4)  any identified risks, security concerns, or   regulatory barriers encountered during the program.          (b)  The department may contract with a private entity to   prepare the report required under this section.          Sec. 2054.705.  COLLABORATION. (a) For the purposes of   satisfying the requirements of Section 2054.702, the department   shall collaborate with a state university that operates:                (1)  a statewide technology center for data established   under Section 2054.382; and                (2)  a regional network security center established   under Section 2059.202.          (b)  The department may collaborate or contract with private   technology firms or consultants for technical expertise or   assistance in implementing the program.          Sec. 2054.706.  FUNDING. (a) Funding for the program   consists of:                (1)  money appropriated by the legislature for the   purposes of the program;                (2)  gifts, grants, and donations received under   Subsection (c); and                (3)  any other money available for the purposes of the   program.          (b)  If the amount available under Subsection (a) is less   than the costs to administer the program, the governor and the   Legislative Budget Board may transfer or repurpose money under a   proposal under Chapter 317 to provide additional funding to   administer the program.          (c)  The department may solicit and accept gifts, grants, and   donations from any public or private source.          (d)  Not later than January 1, 2029, the department shall   transfer all unspent funds to the general revenue fund.          Sec. 2054.707.  RULES. The department shall adopt rules   necessary to administer the pilot program.          Sec. 2054.708.  EXPIRATION. This subchapter expires   September 1, 2029.          SECTION 2.  (a) Not later than December 1, 2025, the   Department of Information Resources shall adopt rules necessary to   implement and administer the State Blockchain Technology Pilot   Program established under Section 2054.702, Government Code, as   added by this Act.          (b)  As soon as practicable after the effective date of this   Act, the Department of Information Resources shall prepare and   submit the list of recommended state agencies required by Section   2054.703, Government Code, as added by this Act.          (c)  Not later than 15 business days after receiving the list   of recommended state agencies, the governor shall select a state   agency to participate in the State Blockchain Technology Pilot   Program as required by Section 2054.703, Government Code, as added   by this Act.          SECTION 3.  It is the intent of the legislature that every   provision, section, subsection, sentence, clause, phrase, or word   in this Act, and every application of the provisions in this Act to   every person, group of persons, or circumstances, is severable from   each other. If any application of any provision in this Act to any   person, group of persons, or circumstances is found by a court to be   invalid for any reason, the remaining applications of that   provision to all other persons and circumstances shall be severed   and may not be affected.          SECTION 4.  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.