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  H.B. No. 2542
 
 
 
 
AN ACT
  relating to the continuation and functions of the Office of Rural
  Community Affairs.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 487.001(1), Government Code, is amended
  to read as follows:
               (1)  "Board" ["Executive committee"] means the board 
  [executive committee] of the Office of Rural Community Affairs.
         SECTION 2.  Section 487.002, Government Code, is amended to
  read as follows:
         Sec. 487.002.  SUNSET PROVISION.  The Office of Rural
  Community Affairs is subject to Chapter 325 (Texas Sunset Act).
  Unless continued in existence as provided by that chapter, the
  office is abolished and this chapter expires September 1, 2013
  [2007].
         SECTION 3.  Section 487.021, Government Code, is amended to
  read as follows:
         Sec. 487.021.  BOARD [EXECUTIVE COMMITTEE].  (a)  The board
  [executive committee] is the governing body of the office.
         (b)  The board [executive committee] is composed of the
  following 11 [nine] members:
               (1)  four [three] members who represent different
  geographic regions of the state appointed by the governor,
  including:
                     (A)  two locally elected rural city or county
  officials or city or county employees involved with rural
  development; and
                     (B)  two public members each of whom resides in a
  rural city or county;
               (2)  three public members appointed by the [lieutenant]
  governor from a list of nominees submitted by the lieutenant
  governor; [and]
               (3)  three public members appointed by the governor
  from a list of nominees submitted by the speaker of the house of
  representatives; and
               (4)  the commissioner of agriculture or the
  commissioner's designee.
         (b-1)  The individuals nominated by the lieutenant governor
  and the speaker of the house of representatives must reside in a
  rural city or county and be interested in rural issues. In making
  an appointment under Subsection (b)(2) or (3), the governor may
  reject one or more of the nominees on a list submitted by the
  lieutenant governor or the speaker of the house of representatives
  and request a new list of different nominees.
         (c)  In this section, "rural city or county" means a rural
  city or county as defined by the federal community development
  block grant nonentitlement program.  [The governor, the lieutenant
  governor, and the speaker of the house of representatives shall
  each appoint at least two members who possess a strong
  understanding of and commitment to rural interests based on the
  individual's personal history, including residency, occupation,
  and business or civic activities.]
         (d)  Appointments to the board [executive committee] shall
  be made without regard to the race, color, disability, sex,
  religion, age, or national origin of the appointees.
         (e)  The members of the board who are not serving as an
  additional duty of an office in state government [executive
  committee] serve for staggered six-year terms, with the terms of
  three or four members expiring February 1 of each odd-numbered
  year.
         (f)  Board [Executive committee] members receive no
  compensation but are entitled to reimbursement of actual and
  necessary expenses incurred in the performance of their duties.
         (g)  The governor shall designate a member [The members] of
  the board as the [executive committee annually shall elect a]
  presiding officer [from among the members] of the board to serve in
  that capacity at the will of the governor [executive committee].
         (h)  Service on the board by the commissioner of agriculture
  or an officer of a county or municipality is an additional duty of
  the individual's office.
         SECTION 4.  Sections 487.022(b) and (c), Government Code,
  are amended to read as follows:
         (b)  A person may not be a member of the board [executive
  committee] and may not be an office employee employed in a "bona
  fide executive, administrative, or professional capacity," as that
  phrase is used for purposes of establishing an exemption to the
  overtime provisions of the federal Fair Labor Standards Act of 1938
  (29 U.S.C. Section 201 et seq.) and its subsequent amendments, if:
               (1)  the person is an officer, employee, or paid
  consultant of a Texas trade association in the field of rural
  affairs; or
               (2)  the person's spouse is an officer, manager, or paid
  consultant of a Texas trade association in the field of rural
  affairs.
         (c)  A person may not be a member of the board [executive
  committee] or act as the general counsel to the board [executive
  committee] or the office if the person is required to register as a
  lobbyist under Chapter 305 because of the person's activities for
  compensation on behalf of a profession related to the operation of
  the office.
         SECTION 5.  Sections 487.023 through 487.027, Government
  Code, are amended to read as follows:
         Sec. 487.023.  TRAINING FOR MEMBERS OF BOARD [EXECUTIVE
  COMMITTEE]. (a)  A person who is appointed to and qualifies for
  office as a member of the board [executive committee] may not vote,
  deliberate, or be counted as a member in attendance at a meeting of
  the board [executive committee] until the person completes a
  training program that complies with this section.
         (b)  The training program must provide the person with
  information regarding:
               (1)  the legislation that created the office [and the
  executive committee];
               (2)  the programs, [operated by the office;
               [(3)  the role and] functions, [of the office;
               [(4)  the] rules, [of the office, with an emphasis on
  any rules that relate to disciplinary] and [investigatory
  authority;
               [(5)  the current] budget of [for] the office;
               (3) [(6)]  the results of the most recent formal audit
  of the office;
               (4) [(7)]  the requirements of laws relating to[:
                     [(A)  the] open meetings [law], [Chapter 551;
                     [(B)  the] public information [law], [Chapter
  552;
                     [(C)  the] administrative procedure [law],
  [Chapter 2001;] and conflicts of interest
                     [(D)     other laws relating to public officials,
  including conflict-of-interest laws]; and
               (5) [(8)]  any applicable ethics policies adopted by
  the office [executive committee] or the Texas Ethics Commission.
         (c)  A person appointed to the board [executive committee] is
  entitled to reimbursement, as provided by [general law and] the
  General Appropriations Act, for the travel expenses incurred in
  attending the training program regardless of whether the attendance
  at the program occurs before or after the person qualifies for
  office.
         Sec. 487.024.  REMOVAL. (a)  It is a ground for removal from
  the board [executive committee] that a member:
               (1)  does not have at the time of taking office the
  qualifications required by Section 487.021;
               (2)  does not maintain during service on the board 
  [executive committee] the qualifications required by Section
  487.021;
               (3)  is ineligible for membership under Section
  487.022;
               (4)  cannot, because of illness or disability,
  discharge the member's duties for a substantial part of the member's
  term; or
               (5)  is absent from more than half of the regularly
  scheduled board [executive committee] meetings that the member is
  eligible to attend during a calendar year without an excuse
  approved by a majority vote of the board [executive committee].
         (b)  The validity of an action of the board [executive
  committee] is not affected by the fact that it is taken when a
  ground for removal of a board [an executive committee] member
  exists.
         (c)  If the executive director has knowledge that a potential
  ground for removal exists, the executive director shall notify the
  presiding officer of the board [executive committee] of the
  potential ground. The presiding officer shall then notify the
  appointing authority [governor] and the attorney general that a
  potential ground for removal exists. If the potential ground for
  removal involves the presiding officer, the executive director
  shall notify the next highest ranking officer of the board 
  [executive committee], who shall then notify the appointing
  authority [governor] and the attorney general that a potential
  ground for removal exists.
         Sec. 487.025.  DIVISION OF RESPONSIBILITY. The board 
  [executive committee] shall develop and implement policies that
  clearly separate the policy-making responsibilities of the board 
  [executive committee] and the management responsibilities of the
  executive director and staff of the office.
         Sec. 487.026.  EXECUTIVE DIRECTOR. (a)  The board 
  [executive committee] may hire an executive director to serve as
  the chief executive officer of the office and to perform the
  administrative duties of the office.
         (b)  The executive director serves at the will of the board 
  [executive committee].
         (c)  The executive director may hire staff within guidelines
  established by the board [executive committee].
         Sec. 487.027.  PUBLIC HEARINGS. The board [executive
  committee] shall develop and implement policies that provide the
  public with a reasonable opportunity to appear before the board
  [executive committee] and to speak on any issue under the
  jurisdiction of the office.
         SECTION 6.  Section 487.029, Government Code, is amended to
  read as follows:
         Sec. 487.029.  STANDARDS OF CONDUCT. The executive director
  or the executive director's designee shall provide to members of
  the board [executive committee] and to agency employees, as often
  as necessary, information regarding the requirements for office or
  employment under this chapter, including information regarding a
  person's responsibilities under applicable laws relating to
  standards of conduct for state officers or employees.
         SECTION 7.  Section 487.030, Government Code, is amended to
  read as follows:
         Sec. 487.030.  COMPLAINTS.  (a)  The office shall maintain a
  system to promptly and efficiently act on complaints [file on each
  written complaint] filed with the office. The office shall
  maintain information about parties to the complaint, the subject
  matter of the complaint, a summary of the results of the review or
  investigation of the complaint, and its disposition [The file must
  include:
               [(1)  the name of the person who filed the complaint;
               [(2)  the date the complaint is received by the office;
               [(3)  the subject matter of the complaint;
               [(4)     the name of each person contacted in relation to
  the complaint;
               [(5)     a summary of the results of the review or
  investigation of the complaint; and
               [(6)     an explanation of the reason the file was closed,
  if the office closed the file without taking action other than to
  investigate the complaint].
         (b)  The office shall make information available describing
  its [provide to the person filing the complaint and to each person
  who is a subject of the complaint a copy of the office's policies
  and] procedures for [relating to] complaint investigation and
  resolution.
         (c)  The office[, at least quarterly until final disposition
  of the complaint,] shall periodically notify the complaint parties
  [person filing the complaint and each person who is a subject of the
  complaint] of the status of the complaint until final disposition
  [investigation unless the notice would jeopardize an undercover
  investigation].
         SECTION 8.  Subchapter B, Chapter 487, Government Code, is
  amended by adding Sections 487.031 and 487.032 to read as follows:
         Sec. 487.031.  USE OF TECHNOLOGY.  The board shall implement
  a policy requiring the office to use appropriate technological
  solutions to improve the office's ability to perform its functions.
  The policy must ensure that the public is able to interact with the
  office on the Internet.
         Sec. 487.032.  NEGOTIATED RULEMAKING AND ALTERNATIVE
  DISPUTE RESOLUTION PROCEDURES. (a) The board shall develop and
  implement a policy to encourage the use of:
               (1)  negotiated rulemaking procedures under Chapter
  2008 for the adoption of office rules; and
               (2)  appropriate alternative dispute resolution
  procedures under Chapter 2009 to assist in the resolution of
  internal and external disputes under the office's jurisdiction.
         (b)  The office's procedures relating to alternative dispute
  resolution must conform, to the extent possible, to any model
  guidelines issued by the State Office of Administrative Hearings
  for the use of alternative dispute resolution by state agencies.
         (c)  The board shall designate a trained person to:
               (1)  coordinate the implementation of the policy
  adopted under Subsection (a);
               (2)  serve as a resource for any training needed to
  implement the procedures for negotiated rulemaking or alternative
  dispute resolution; and
               (3)  collect data concerning the effectiveness of those
  procedures, as implemented by the office.
         SECTION 9.  Section 487.051, Government Code, is amended to
  read as follows:
         Sec. 487.051.  POWERS AND DUTIES.  (a) The office shall:
               (1)  assist rural communities in the key areas of
  economic development, community development, rural health, and
  rural housing [develop a rural policy for the state in consultation
  with local leaders representing all facets of rural community life,
  academic and industry experts, and state elected and appointed
  officials with interests in rural communities];
               (2)  serve as a clearinghouse for information and
  resources on all state and federal programs affecting rural
  communities [work with other state agencies and officials to
  improve the results and the cost-effectiveness of state programs
  affecting rural communities through coordination of efforts];
               (3)  in consultation with rural community leaders,
  locally elected officials, state elected and appointed officials,
  academic and industry experts, and the interagency work group
  created under this chapter, identify and prioritize policy issues
  and concerns affecting rural communities in the state [develop
  programs to improve the leadership capacity of rural community
  leaders];
               (4)  make recommendations to the legislature to address
  the concerns affecting rural communities identified under
  Subdivision (3);
               (5)  monitor developments that have a substantial
  effect on rural Texas communities, especially actions of state
  government, and compile an annual report describing and evaluating
  the condition of rural communities;
               (6) [(5)]  administer the federal community
  development block grant nonentitlement program;
               (7) [(6)]  administer programs supporting rural health
  care as provided by this chapter;
               (8) [(7)]  perform research to determine the most
  beneficial and cost-effective ways to improve the welfare of rural
  communities;
               (9) [(8)]  ensure that the office qualifies as the
  state's office of rural health for the purpose of receiving grants
  from the Office of Rural Health Policy of the United States
  Department of Health and Human Services under 42 U.S.C. Section
  254r;
               (10) [(9)]  manage the state's Medicare rural hospital
  flexibility program under 42 U.S.C. Section 1395i-4; [and]
               (11) [(10)]  seek state and federal money available for
  economic development in rural areas for programs under this
  chapter; and
               (12)  in conjunction with the Department of
  Agriculture, regularly cross-train office employees with employees
  of the Department of Agriculture regarding the programs
  administered and services provided by each agency to rural
  communities.
         (b)  The office may require office employees who work at
  locations other than the central office to be based in Department of
  Agriculture offices.
         SECTION 10.  Section 487.052, Government Code, is amended to
  read as follows:
         Sec. 487.052.  RULES. The board [executive committee] may
  adopt rules as necessary to implement this chapter.
         SECTION 11.  Section 487.053(b), Government Code, is amended
  to read as follows:
         (b)  All gifts, grants, and donations must be accepted in an
  open meeting by a majority of the voting members of the board 
  [executive committee] and reported in the public record of the
  meeting with the name of the donor and purpose of the gift, grant,
  or donation.
         SECTION 12.  Section 487.054(b), Government Code, is amended
  to read as follows:
         (b)  The board [executive committee] shall call the annual
  meeting. The board [executive committee] shall set the time and
  date of the meeting after consulting with the agency heads listed in
  Subsection (a).
         SECTION 13.  Section 487.055, Government Code, is amended to
  read as follows:
         Sec. 487.055.  ADVISORY COMMITTEES. The board [executive
  committee] may appoint advisory committees as necessary to assist
  the board [executive committee] in performing its duties. An
  advisory committee may be composed of private citizens and
  representatives from state and local governmental entities. A
  state or local governmental entity shall appoint a representative
  to an advisory committee at the request of the board [executive
  committee]. Chapter 2110 does not apply to an advisory committee
  created under this section.
         SECTION 14.  Section 487.056, Government Code, is amended by
  adding Subsection (c) to read as follows:
         (c)  The office shall obtain information on the availability
  of housing in rural communities throughout the state for all income
  levels. The office shall include the information, and the office's
  assessment of the information, in the office's report to the
  legislature.
         SECTION 15.  Section 487.057(b), Government Code, is amended
  to read as follows:
         (b)  The office shall submit the rural health work plan to
  the board [executive committee] for approval. The board [executive
  committee] shall approve the rural health work plan not later than
  August 1 of each odd-numbered year.
         SECTION 16.  Sections 487.059(b), (c), (e), (f), and (g),
  Government Code, are amended to read as follows:
         (b)  If a member of the board [executive committee] or a
  [another] committee established under this chapter, including an
  advisory committee, has a financial interest in an entity that
  applies for a monetary award, the board or committee member shall,
  before a vote on the monetary award, disclose the fact of the board
  or committee member's financial interest. The board or committee
  shall enter the disclosure into the minutes of the meeting at which
  a vote on the monetary award is taken. The board or committee
  member may not vote on or otherwise participate in a discussion or
  any other activity that relates to awarding the monetary award. If
  the board or committee member does not comply with this subsection,
  the entity is not eligible for the monetary award.
         (c)  If the executive director or another office employee has
  a financial interest in an entity that applies for a monetary award,
  the executive director or employee:
               (1)  shall, as soon as possible, disclose to the board 
  [executive committee] the fact of the director's or employee's
  financial interest;
               (2)  may not participate in staff evaluations regarding
  the monetary award; and
               (3)  if the executive director or employee under office
  procedures may [has a] vote, or make a recommendation concerning a
  vote, on a matter that involves the monetary award:
                     (A)  shall disclose the fact of the director's or
  employee's financial interest before a vote on the monetary award,
  which the board or committee shall enter into the minutes of the
  meeting at which a vote on the monetary award is taken; and
                     (B)  may not vote on or otherwise participate in a
  discussion or any other activity that relates to awarding the
  monetary award.
         (e)  Subsections (f) and (g) apply only to a member of the
  board or a [executive] committee who is employed by:
               (1)  an entity that offers to enter into a contract with
  the office; or
               (2)  an entity that is under common ownership or
  governance with or otherwise affiliated with an entity that applies
  for a monetary award or offers to enter into a contract with the
  office.
         (f)  The board or [executive] committee member shall, before
  a vote on the monetary award or contract, disclose the fact of the
  member's employment by the entity. The board or [executive]
  committee shall enter the disclosure into the minutes of the
  meeting at which a vote on the monetary award or contract is taken.
  The board or [executive] committee member may not vote on or
  otherwise participate in a discussion or any other activity that
  relates to awarding the monetary award or contract.
         (g)  If the board or [executive] committee member does not
  comply with Subsection (f), the entity is not eligible to be awarded
  the monetary award or contract.
         SECTION 17.  Sections 487.103(a), (b), and (c), Government
  Code, are amended to read as follows:
         (a)  The selection committee shall advise the board 
  [executive committee] on the progress of the program.
         (b)  The selection committee is composed of 12 members
  appointed by the board [executive committee].
         (c)  The board [executive committee] shall consider
  geographical representation in making appointments to the
  selection committee.
         SECTION 18.  Sections 487.104(b) and (d), Government Code,
  are amended to read as follows:
         (b)  The selection committee shall make selections based on
  criteria approved by the board [executive committee] and adopted as
  a rule of the office.
         (d)  The selection committee shall recommend to the board 
  [executive committee] guidelines to be used by rural communities in
  the selection of students for nomination and sponsorship as
  outstanding rural scholars.
         SECTION 19.  Section 487.107, Government Code, is amended to
  read as follows:
         Sec. 487.107.  AWARDING OF LOANS. (a)  The selection
  committee shall recommend to the board [executive committee]
  guidelines for the awarding of forgivable loans to outstanding
  rural scholars.
         (b)  The board [executive committee], acting on the advice of
  the selection committee, shall award forgivable loans to
  outstanding rural scholars based on the availability of money in
  the fund.
         (c)  If in any year the fund is inadequate to provide loans to
  all eligible applicants, the board [executive committee] shall
  award forgivable loans on a priority basis according to the
  applicants' academic performance, test scores, and other criteria
  of eligibility.
         SECTION 20.  Section 487.108(a), Government Code, is amended
  to read as follows:
         (a)  On confirmation of an outstanding rural scholar's
  admission to a postsecondary educational institution, or on receipt
  of an enrollment report of the scholar at a postsecondary
  educational institution, and a certification of the amount of
  financial support needed, the selection committee annually shall
  recommend to the board [executive committee] that the board 
  [committee] award a forgivable loan to the scholar in the amount of
  50 percent of the cost of the scholar's tuition, fees, educational
  materials, and living expenses.
         SECTION 21.  Sections 487.109(b), (c), and (d), Government
  Code, are amended to read as follows:
         (b)  The sponsoring community shall report to the board 
  [executive committee] the length of time the scholar practices as a
  health care professional in the community.
         (c)  If the board [executive committee] finds that a
  sponsoring community is not in need of the scholar's services and
  that the community is willing to forgive repayment of the principal
  balance and interest of the scholar's loan, the board [executive
  committee] by rule may provide for the principal balance and
  interest of one year of the scholar's loan to be forgiven for each
  year the scholar practices in another rural community in this
  state.
         (d)  Any amount of loan principal or interest that is not
  forgiven under this section shall be repaid to the office with
  reasonable collection fees in a timely manner as provided by board 
  [executive committee] rule.
         SECTION 22.  Section 487.112, Government Code, is amended to
  read as follows:
         Sec. 487.112.  ADOPTION AND DISTRIBUTION OF RULES. (a)  The
  board [executive committee] shall adopt reasonable rules to enforce
  the requirements, conditions, and limitations under this
  subchapter.
         (b)  The board [executive committee] shall set the rate of
  interest charged on a forgivable loan under this subchapter.
         (c)  The board [executive committee] shall adopt rules
  necessary to ensure compliance with the federal Civil Rights Act of
  1964 (42 U.S.C. Section 2000a et seq.) concerning nondiscrimination
  in admissions.
         SECTION 23.  Section 487.154, Government Code, is amended to
  read as follows:
         Sec. 487.154.  LOANS. (a)  The board [executive committee]
  may award forgivable educational loans to eligible students under
  this subchapter.
         (b)  The board [executive committee] may award forgivable
  loans to eligible students based on the availability of money in the
  fund.
         (c)  If in any year the fund is inadequate to provide loans to
  all eligible students, the board [executive committee] may award
  forgivable loans on a priority basis according to the students'
  academic performance, test scores, and other criteria of
  eligibility.
         SECTION 24.  Section 487.155(a), Government Code, is amended
  to read as follows:
         (a)  To be eligible to receive a loan under this subchapter,
  a student must:
               (1)  be sponsored by an eligible community;
               (2)  at the time of the application for the loan, be
  enrolled in high school or enrolled or accepted for enrollment in a
  postsecondary educational institution in this state;
               (3)  meet academic requirements as established by the
  board [executive committee];
               (4)  plan to complete a health care professional degree
  or certificate program;
               (5)  plan to practice as a health care professional in a
  qualified area of the state; and
               (6)  meet other requirements as established by the
  board [executive committee].
         SECTION 25.  Section 487.156(c), Government Code, is amended
  to read as follows:
         (c)  The board [executive committee] shall determine the
  percentage of educational expenses communities are required to
  provide under this section.
         SECTION 26.  Section 487.157(a), Government Code, is amended
  to read as follows:
         (a)  On confirmation of an eligible student's admission to a
  postsecondary educational institution, or on receipt of an
  enrollment report of the student at a postsecondary educational
  institution, and certification of the amount of financial support
  needed, the board [executive committee] may award a forgivable loan
  to the student in the amount of not more than the cost of the
  student's tuition, fees, educational materials, and living
  expenses.
         SECTION 27.  Section 487.158(b), Government Code, is amended
  to read as follows:
         (b)  The contract must provide that if the student does not
  provide the required services to the community or provides those
  services for less than the required time, the student is personally
  liable to the state for:
               (1)  the total amount of assistance the student
  receives from the office and the sponsoring community;
               (2)  interest on the total amount at a rate set by the
  board [executive committee]; and
               (3)  the state's reasonable expenses incurred in
  obtaining payment, including reasonable attorney's fees.
         SECTION 28.  Section 487.159(b), Government Code, is amended
  to read as follows:
         (b)  If the board [executive committee] finds that a
  sponsoring community is not in need of the student's services and
  that the community is willing to forgive repayment of the principal
  balance and interest of the student's loan, the board [executive
  committee] by rule may provide for the principal balance and
  interest of the student's loan to be forgiven if the student
  provides services in another qualified area in this state.
         SECTION 29.  Sections 487.161(b) and (c), Government Code,
  are amended to read as follows:
         (b)  The sponsoring community shall report to the board 
  [executive committee] the length of time the student provides
  health care services in the community in accordance with the
  guidelines established by the board [executive committee].
         (c)  A postsecondary educational institution shall provide
  to the board [executive committee] a copy of the academic
  transcript of each student for whom the institution has received a
  release that complies with state and federal open records laws and
  that authorizes the provision of the transcript.
         SECTION 30.  Section 487.163, Government Code, is amended to
  read as follows:
         Sec. 487.163.  ADOPTION OF RULES. (a)  The board [executive
  committee] shall adopt reasonable rules to enforce the
  requirements, conditions, and limitations of this subchapter.
         (b)  The board [executive committee] shall set the rate of
  interest charged on a forgivable loan under this subchapter.
         (c)  The board [executive committee] shall adopt rules
  necessary to ensure compliance with the federal Civil Rights Act of
  1964 (42 U.S.C. Section 2000a et seq.) concerning nondiscrimination
  in admissions.
         SECTION 31.  Sections 487.202, 487.203, and 487.204,
  Government Code, are amended to read as follows:
         Sec. 487.202.  PROGRAM. (a)  The board [executive
  committee] shall establish and administer a program under this
  subchapter to increase the number of physicians providing primary
  care in medically underserved communities.
         (b)  A medically underserved community may sponsor a
  physician who has completed a primary care residency program and
  has agreed to provide primary care in the community by contributing
  start-up money for the physician and having that contribution
  matched wholly or partly by state money appropriated to the office 
  [executive committee] for that purpose.
         (c)  A participating medically underserved community may
  provide start-up money to an eligible physician over a two-year
  period.
         (d)  The office [executive committee] may not pay more than
  $25,000 to a community in a fiscal year unless the board [executive
  committee] makes a specific finding of need by the community.
         (e)  The board [executive committee] shall establish
  priorities so that the neediest communities eligible for assistance
  under this subchapter are assured the receipt of a grant.
         Sec. 487.203.  ELIGIBILITY. To be eligible to receive money
  from the office [executive committee], a medically underserved
  community must:
               (1)  apply for the money; and
               (2)  provide evidence satisfactory to the board 
  [executive committee] that it has entered into an agreement with a
  physician for the physician to provide primary care in the
  community for at least two years.
         Sec. 487.204.  RULES. The board [executive committee] shall
  adopt rules necessary for the administration of this subchapter,
  including rules addressing:
               (1)  eligibility criteria for a medically underserved
  community;
               (2)  eligibility criteria for a physician;
               (3)  minimum and maximum community contributions to the
  start-up money for a physician to be matched with state money;
               (4)  conditions under which state money must be repaid
  by a community or physician;
               (5)  procedures for disbursement of money by the office 
  [executive committee];
               (6)  the form and manner in which a community must make
  its contribution to the start-up money; and
               (7)  the contents of an agreement to be entered into by
  the parties, which must include at least:
                     (A)  a credit check for an eligible physician; and
                     (B)  community retention of interest in any
  property, equipment, or durable goods for seven years.
         SECTION 32.  Section 487.252, Government Code, is amended to
  read as follows:
         Sec. 487.252.  TEXAS HEALTH SERVICE CORPS PROGRAM. (a)  The
  board [executive committee] shall establish a program in the office
  to assist communities in recruiting and retaining physicians to
  practice in medically underserved areas.
         (b)  The board [executive committee] by rule shall
  establish:
               (1)  eligibility criteria for applicants;
               (2)  stipend application procedures;
               (3)  guidelines relating to stipend amounts;
               (4)  procedures for evaluating stipend applications;
  and
               (5)  a system of priorities relating to the:
                     (A)  geographic areas covered;
                     (B)  medical specialties eligible to receive
  funding under the program; and
                     (C)  level of stipend support.
         SECTION 33.  Section 487.253(a), Government Code, is amended
  to read as follows:
         (a)  The board [executive committee] shall adopt rules
  necessary to administer this subchapter, and the office shall
  administer the program in accordance with those rules.
         SECTION 34.  Section 487.351, Government Code, is amended by
  adding Subsection (c) to read as follows:
         (c)  The office shall give priority to eligible activities in
  the areas of economic development, community development, rural
  health, and rural housing to support workforce development in
  awarding funding for community development block grant programs.
         SECTION 35.  Subchapter I, Chapter 487, Government Code, is
  amended by adding Section 487.3515 to read as follows:
         Sec. 487.3515.  EVALUATION OF COMMUNITY DEVELOPMENT BLOCK
  GRANT PROGRAM. (a)  The office, in consultation with the Department
  of Agriculture, shall review and evaluate the administration of the
  state's allocation of federal funds under the community development
  block grant nonentitlement program and, based on the results of the
  evaluation, streamline administration of the program and program
  requirements. The office shall, at a minimum, evaluate:
               (1)  combining program fund categories, within
  allowable limits provided by state statute, the General
  Appropriations Act, and federal law and regulations;
               (2)  simplifying the grant application and scoring
  process; and
               (3)  regularly reviewing and closing out aged
  contracts.
         (b)  The office shall implement program changes resulting
  from the evaluation that do not require statutory changes as soon as
  possible, but not later than the date the office publishes the next
  community development block grant nonentitlement program action
  plan.
         (c)  The office shall include the findings from the
  evaluation, program changes resulting from the evaluation, and any
  statutory changes needed to make additional changes in the agency's
  biennial report to the 81st Legislature.
         (d)  This section expires September 1, 2009.
         SECTION 36.  Section 487.353, Government Code, is amended by
  amending Subsections (i) and (j) and adding Subsections (k) and (l)
  to read as follows:
         (i)  The committee shall:
               (1)  consult with and advise the executive director on
  the administration and enforcement of the community development
  block grant program; and
               (2)  in consultation with the executive director and
  office staff, review and approve grant and loan [funding]
  applications and associated funding awards of eligible counties and
  municipalities and advise and assist the executive director
  regarding the allocation of program funds to those applicants.
         (j)  The committee may annually recommend to the executive
  director a formula for allocating funds to each geographic state
  planning region established by the governor under Chapter 391,
  Local Government Code. The formula must give preference to regions
  according to the regions' needs.
         (k)  An applicant for a grant, loan, or award under a
  community development block grant program may appeal a decision of
  the committee by filing a complaint with the board. The board shall
  hold a hearing on a complaint filed with the board under this
  subsection and render a decision.
         (l)  The committee is a governmental body for purposes of the
  open meetings law, Chapter 551.
         SECTION 37.  Section 487.401, Government Code, is amended to
  read as follows:
         Sec. 487.401.  ADMINISTRATION. (a)  The board [executive
  committee] shall adopt rules that establish a procedure for
  designating a hospital as a rural hospital in order for the hospital
  to qualify for federal funds under 42 C.F.R. Part 412.
         (b)  At the hospital's request, the office shall designate
  the hospital as a rural hospital if the hospital meets the
  requirements for a rural hospital under the board's [executive
  committee's] rules.
         SECTION 38.  Section 487.451(1), Government Code, is amended
  to read as follows:
               (1)  "Health care professional" means:
                     (A)  an advanced nurse practitioner;
                     (B)  a dentist;
                     (C)  a dental hygienist;
                     (D)  a laboratory technician;
                     (E)  a licensed vocational nurse;
                     (F)  a licensed professional counselor;
                     (G)  a medical radiological technologist;
                     (H)  an occupational therapist;
                     (I)  a pharmacist;
                     (J)  a physical therapist;
                     (K)  a physician;
                     (L)  a physician assistant;
                     (M)  a psychologist;
                     (N)  a registered nurse;
                     (O)  a social worker;
                     (P)  a speech-language pathologist;
                     (Q)  a veterinarian;
                     (R)  a chiropractor; and
                     (S)  another appropriate health care professional
  identified by the board [executive committee].
         SECTION 39.  Section 487.452(a), Government Code, is amended
  to read as follows:
         (a)  The board [executive committee], in collaboration with
  Area Health Education Center Programs, shall establish a community
  healthcare awareness and mentoring program for students to:
               (1)  identify high school students in rural and
  underserved urban areas who are interested in serving those areas
  as health care professionals;
               (2)  identify health care professionals in rural and
  underserved urban areas to act as positive role models, mentors, or
  reference resources for the interested high school students;
               (3)  introduce interested high school students to the
  spectrum of professional health care careers through activities
  such as health care camps and shadowing of health care
  professionals;
               (4)  encourage a continued interest in service as
  health care professionals in rural and underserved urban areas by
  providing mentors and community resources for students
  participating in training or educational programs to become health
  care professionals; and
               (5)  provide continuing community-based support for
  students during the period the students are attending training or
  educational programs to become health care professionals,
  including summer job opportunities and opportunities to mentor high
  school students in the community.
         SECTION 40.  Section 487.454, Government Code, is amended to
  read as follows:
         Sec. 487.454.  GRANTS; ELIGIBILITY. (a)  Subject to
  available funds, the board [executive committee] shall develop and
  implement, as a component of the program, a grant program to support
  employment opportunities in rural and underserved urban areas in
  this state for students participating in training or educational
  programs to become health care professionals.
         (b)  In awarding grants under the program, the board 
  [executive committee] shall give first priority to grants to
  training or educational programs that provide internships to
  students.
         (c)  To be eligible to receive a grant under the grant
  program, a person must:
               (1)  apply for the grant on a form adopted by the board 
  [executive committee];
               (2)  be enrolled or intend to be enrolled in a training
  or educational program to become a health care professional;
               (3)  commit to practice or work, after licensure as a
  health care professional, for at least one year as a health care
  professional in a rural or underserved urban area in this state; and
               (4)  comply fully with any practice or requirements
  associated with any scholarship, loan, or other similar benefit
  received by the student.
         (d)  As a condition of receiving a grant under the program
  the student must agree to repay the amount of the grant, plus a
  penalty in an amount established by rule of the board [executive
  committee] not to exceed two times the amount of the grant, if the
  student becomes licensed as a health care professional and fails to
  practice or work for at least one year as a health care professional
  in a rural or underserved urban area in this state.
         SECTION 41.  Section 487.553, Government Code, is amended to
  read as follows:
         Sec. 487.553.  LOAN REIMBURSEMENT PROGRAM. The board 
  [executive committee] shall establish a program in the office to
  assist communities in recruiting health professionals to practice
  in medically underserved communities by providing loan
  reimbursement for health professionals who serve in those
  communities.
         SECTION 42.  Section 487.554(a), Government Code, is amended
  to read as follows:
         (a)  The board [executive committee] shall establish a
  program in the office to assist communities in recruiting health
  professionals to practice in medically underserved communities by
  providing a stipend to health professionals who agree to serve in
  those communities.
         SECTION 43.  Section 487.555(e), Government Code, is amended
  to read as follows:
         (e)  A contract under this section must provide that a health
  professional who does not provide the required services to the
  community or provides those services for less than the required
  time is personally liable to the state for:
               (1)  the total amount of assistance the health
  professional received from the office and the medically underserved
  community;
               (2)  interest on the amount under Subdivision (1) at a
  rate set by the board [executive committee];
               (3)  the state's reasonable expenses incurred in
  obtaining payment, including reasonable attorney's fees; and
               (4)  a penalty as established by the board [executive
  committee] by rule to help ensure compliance with the contract.
         SECTION 44.  Section 487.556, Government Code, is amended to
  read as follows:
         Sec. 487.556.  POWERS AND DUTIES OF OFFICE. (a)  The board 
  [executive committee] shall adopt rules necessary for the
  administration of this subchapter, including guidelines for:
               (1)  developing contracts under which loan
  reimbursement or stipend recipients provide services to qualifying
  communities;
               (2)  identifying the duties of the state, state agency,
  loan reimbursement or stipend recipient, and medically underserved
  community under the loan reimbursement or stipend contract;
               (3)  determining a rate of interest to be charged under
  Section 487.555(e)(2);
               (4)  ensuring that a loan reimbursement or stipend
  recipient provides access to health services to participants in
  government-funded health benefits programs in qualifying
  communities;
               (5)  encouraging the use of telecommunications or
  telemedicine, as appropriate;
               (6)  prioritizing the provision of loan reimbursements
  and stipends to health professionals who are not eligible for any
  other state loan forgiveness, loan repayment, or stipend program;
               (7)  prioritizing the provision of loan reimbursements
  and stipends to health professionals who are graduates of health
  professional degree programs in this state;
               (8)  encouraging a medically underserved community
  served by a loan reimbursement or stipend recipient to contribute
  to the cost of the loan reimbursement or stipend when making a
  contribution is feasible; and
               (9)  requiring a medically underserved community
  served by a loan reimbursement or stipend recipient to assist the
  office in contracting with the loan reimbursement or stipend
  recipient who will serve that community.
         (b)  The board [executive committee] by rule may designate
  areas of the state as medically underserved communities.
         (c)  The board [executive committee] shall make reasonable
  efforts to contract with health professionals from a variety of
  different health professions.
         SECTION 45.  Section 487.608(a), Government Code, is amended
  to read as follows:
         (a)  The rural physician relief advisory committee is
  composed of the following members appointed by the board [executive
  committee]:
               (1)  a physician who practices in the area of general
  family medicine in a rural county;
               (2)  a physician who practices in the area of general
  internal medicine in a rural county;
               (3)  a physician who practices in the area of general
  pediatrics in a rural county;
               (4)  a representative from an accredited Texas medical
  school;
               (5)  a program director from an accredited primary care
  residency program;
               (6)  a representative from the Texas Higher Education
  Coordinating Board; and
               (7)  a representative from the Texas [State Board of]
  Medical Board [Examiners].
         SECTION 46.  Section 110.003(a), Health and Safety Code, is
  amended to read as follows:
         (a)  The Rural Foundation is governed by a board of five
  directors appointed by the board [executive committee] of the
  Office of Rural Community Affairs from individuals recommended by
  the executive director of the Office of Rural Community Affairs.
         SECTION 47.  Section 110.010, Health and Safety Code, is
  amended to read as follows:
         Sec. 110.010.  MEMORANDUM OF UNDERSTANDING.  The Rural
  Foundation and the Office of Rural Community Affairs shall enter
  into a memorandum of understanding that:
               (1)  requires the board of directors and staff of the
  foundation to report to the executive director and board [executive
  committee] of the Office of Rural Community Affairs;
               (2)  allows the Office of Rural Community Affairs to
  provide staff functions to the foundation;
               (3)  allows the Office of Rural Community Affairs to
  expend funds on the foundation; and
               (4)  outlines the financial contributions to be made to
  the foundation from funds obtained from grants and other sources.
         SECTION 48.  (a) The nine members of the executive committee
  of the Office of Rural Community Affairs who are serving
  immediately before September 1, 2007, continue to serve as members
  of the governing board of the office on and after that date
  regardless of whether those members meet the membership
  requirements prescribed by Subchapter B, Chapter 487, Government
  Code, as amended by this Act. However, the positions of those nine
  members are abolished on the date on which a majority of the 11
  board membership positions that are created under Section 487.021,
  Government Code, as amended by this Act, are filled and the
  appointees qualify for office.
         (b)  The governor shall make the 10 appointments to the board
  under Section 487.021, Government Code, as amended by this Act, as
  soon as possible on or after September 1, 2007. In making the
  initial appointments, the governor shall designate three members
  for terms expiring February 1, 2009, three members for terms
  expiring February 1, 2011, and four members for terms expiring
  February 1, 2013. Any person who served as a member of the
  executive committee before September 1, 2007, may be appointed to
  the board.
         SECTION 49.  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, 2007.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 2542 was passed by the House on May 7,
  2007, by the following vote:  Yeas 145, Nays 0, 1 present, not
  voting; that the House refused to concur in Senate amendments to
  H.B. No. 2542 on May 24, 2007, and requested the appointment of a
  conference committee to consider the differences between the two
  houses; and that the House adopted the conference committee report
  on H.B. No. 2542 on May 27, 2007, by the following vote:  Yeas 147,
  Nays 0, 2 present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 2542 was passed by the Senate, with
  amendments, on May 21, 2007, by the following vote:  Yeas 30, Nays
  1; at the request of the House, the Senate appointed a conference
  committee to consider the differences between the two houses; and
  that the Senate adopted the conference committee report on H.B. No.
  2542 on May 26, 2007, by the following vote:  Yeas 30, Nays 0.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor