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H.B. No. 2390
AN ACT
relating to the establishment of an employee welfare benefit plan
by certain private educational institutions.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The Education Code is amended by adding Title 6
to read as follows:
TITLE 6. BENEFITS CONSORTIUMS
CHAPTER 2000. BENEFITS CONSORTIUMS FOR CERTAIN
PRIVATE EDUCATIONAL INSTITUTIONS
Sec. 2000.001. DEFINITIONS. In this chapter:
(1) "Employee welfare benefit plan" has the meaning
assigned by Section 3(1), Employee Retirement Income Security Act
of 1974 (29 U.S.C. Section 1002(1)).
(2) "Private educational institution" means any
nonpublic, nonprofit, and accredited school that:
(A) is owned and operated by an individual,
religious institution, partnership, association, or corporation,
or a department, division, or section of one of those entities; and
(B) designates itself as a private educational
center that includes a program of elementary, secondary, religious,
college, or university education whose primary purpose is to
provide private or religious-based education.
Sec. 2000.002. FORMATION OF BENEFITS CONSORTIUM. Two or
more private educational institutions may form a benefits
consortium for the purpose of establishing a self-funded employee
welfare benefit plan by adopting articles of incorporation or a
declaration of trust. The articles of incorporation or declaration
of trust must:
(1) limit membership in the benefits consortium to
private educational institutions;
(2) list the charter members of the benefits
consortium;
(3) include the method by which other institutions may
be admitted as members of the benefits consortium;
(4) require that each member agree to an initial
membership term of not less than three years;
(5) provide that the directors or trustees of the
benefits consortium be elected from or on behalf of the membership
of the benefits consortium and prescribe the method for selection
of directors or trustees of the benefits consortium;
(6) provide that the directors or trustees have
complete fiscal control over the plan and are responsible for all
operations of the plan;
(7) list the purposes of the benefits consortium,
including the types of risks shared by members of the consortium;
(8) establish bylaws of the benefits consortium; and
(9) provide for amendment of the articles of
incorporation or declaration of trust and the bylaws.
Sec. 2000.003. FILINGS BY BENEFITS CONSORTIUM. A benefits
consortium formed under this chapter shall:
(1) file with the commissioner of insurance a copy of
the consortium's articles of incorporation or declaration of trust
and any amendments to the articles of incorporation or declaration
of trust; and
(2) comply with all reporting requirements under the
Employee Retirement Income Security Act of 1974 (29 U.S.C. Section
1001 et seq.).
Sec. 2000.004. REGULATION OF BENEFITS CONSORTIUM;
EXEMPTION FROM STATE REGULATION. An employee welfare benefit plan
established by a benefits consortium under this chapter that is
sponsored by a trade association in existence for 10 years or more,
is in good standing with the secretary of state, and meets the
requirements of this chapter is governed solely by and shall comply
with the Employee Retirement Income Security Act of 1974 (29 U.S.C.
Section 1001 et seq.), as implemented by the United States
Department of Labor.
SECTION 2. 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, 2005.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 2390 was passed by the House on May
10, 2005, by the following vote: Yeas 141, Nays 0, 2 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 2390 was passed by the Senate on May
23, 2005, by the following vote: Yeas 31, Nays 0.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor