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  By: Nelson, et al.  S.B. No. 149
         (In the Senate - Filed December 19, 2012; January 29, 2013,
  read first time and referred to Committee on Health and Human
  Services; February 18, 2013, reported adversely, with favorable
  Committee Substitute by the following vote:  Yeas 9, Nays 0;
  February 18, 2013, sent to printer.)
 
  COMMITTEE SUBSTITUTE FOR S.B. No. 149 By:  Nelson
 
 
A BILL TO BE ENTITLED
 
AN ACT
 
  relating to the Cancer Prevention and Research Institute of Texas.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 102.001, Health and Safety Code, is
  amended by adding Subdivision (2-a) and amending Subdivision (3) to
  read as follows:
               (2-a)  "Program integration committee" means the
  Cancer Prevention and Research Institute of Texas Program
  Integration Committee.
               (3)  "Research and prevention programs committee"
  means a [the] Cancer Prevention and Research Institute of Texas
  Scientific Research and Prevention Programs committee [committees]
  appointed by the chief executive officer [director].
         SECTION 2.  Section 102.051, Health and Safety Code, is
  amended by amending Subsection (a) and adding Subsection (c) to
  read as follows:
         (a)  The institute may:
               (1)  make grants to provide funds to public or private
  persons to implement the Texas Cancer Plan, and may make grants to
  institutions of learning and to advanced medical research
  facilities and collaborations in this state for:
                     (A)  research into the causes of and cures for all
  types of cancer in humans;
                     (B)  facilities for use in research into the
  causes of and cures for cancer;
                     (C)  research, including translational research,
  to develop therapies, protocols, medical pharmaceuticals, or
  procedures for the cure or substantial mitigation of all types of
  cancer in humans; and
                     (D)  cancer prevention and control programs in
  this state to mitigate the incidence of all types of cancer in
  humans;
               (2)  support institutions of learning and advanced
  medical research facilities and collaborations in this state in all
  stages in the process of finding the causes of all types of cancer
  in humans and developing cures, from laboratory research to
  clinical trials and including programs to address the problem of
  access to advanced cancer treatment;
               (3)  establish the appropriate standards and oversight
  bodies to ensure the proper use of funds authorized under this
  chapter for cancer research and facilities development;
               (4)  [employ an executive director as determined by the
  oversight committee;
               [(5)]  employ necessary staff to provide
  administrative support; and
               (5) [(6)]  monitor contracts and agreements authorized
  by this chapter.
         (c)  The institute shall employ a compliance officer, who,
  under the direction of the chief executive officer, shall ensure
  that:
               (1)  all grant proposals comply with this chapter and
  rules adopted under this chapter before the proposals are submitted
  to the oversight committee for approval;
               (2)  the institute, its employees, and its committee
  members appointed under this chapter comply with all laws and rules
  governing the peer review process and conflicts of interest; and
               (3)  each grant recipient complies with the terms of
  the grant contract.
         SECTION 3.  Subchapter B, Chapter 102, Health and Safety
  Code, is amended by adding Section 102.0511 to read as follows:
         Sec. 102.0511.  CHIEF EXECUTIVE OFFICER; OTHER OFFICERS.  
  (a)  The oversight committee shall hire a chief executive officer.  
  Under the direction of the oversight committee, the chief executive
  officer shall perform the duties required by this chapter or
  designated by the oversight committee.
         (b)  The chief executive officer must have a demonstrated
  ability to lead and develop academic, commercial, and governmental
  partnerships and coalitions.
         (c)  The chief executive officer shall hire:
               (1)  one chief scientific officer, who reports directly
  to the chief executive officer;
               (2)  one chief operating officer, who reports directly
  to the chief executive officer;
               (3)  one development officer, who reports directly to
  the chief executive officer and assists in collaborative outreach
  to further cancer research and prevention; and
               (4)  one chief prevention officer, who reports directly
  to the chief executive officer.
         SECTION 4.  Subsection (a), Section 102.052, Health and
  Safety Code, is amended to read as follows:
         (a)  The institute shall issue an annual public report
  outlining the institute's activities, grants awarded, grants in
  progress, research accomplishments, and future program
  directions.  The report must include:
               (1)  the number and dollar amounts of research and
  facilities grants;
               (2)  identification of the grant recipients for the
  reported year;
               (3)  the institute's administrative expenses;
               (4)  an assessment of the availability of funding for
  cancer research from sources other than the institute;
               (5)  a summary of findings of research funded by the
  institute, including promising new research areas;
               (6)  an assessment of the relationship between the
  institute's grants and the overall strategy of its research
  program;
               (7)  a statement of the institute's strategic research
  and financial plans; [and]
               (8)  an estimate of how much cancer has cost the state
  during the year, including the amounts spent by the state relating
  to cancer by the child health program, the Medicaid program, the
  Teacher Retirement System of Texas, and the Employees Retirement
  System of Texas; and
               (9)  a statement of the institute's compliance program
  activities, including any proposed legislation or other
  recommendations identified through the activities.
         SECTION 5.  Subchapter B, Chapter 102, Health and Safety
  Code, is amended by adding Section 102.0535 to read as follows:
         Sec. 102.0535.  RECORD OF GRANT APPLICATIONS. (a)  The
  institute shall maintain a complete record of each grant
  application, including a grant application that is reviewed by a
  research and prevention programs committee or is withdrawn.
         (b)  The institute shall ensure that the score assigned to a
  grant application by a research and prevention programs committee
  in accordance with rules adopted under Section 102.251(a)(1) is
  included in the record for the application.
         (c)  The institute shall have periodic audits made of any
  electronic grant management system used to maintain records of
  grant applications under this section.  The institute shall address
  in a timely manner each weakness identified in an audit of the
  system.
         SECTION 6.  Section 102.056, Health and Safety Code, is
  amended to read as follows:
         Sec. 102.056.  SALARY. (a)  The institute may supplement
  the salary of the chief executive officer [director] and other
  senior institute staff members.  Funding for a salary supplement
  may come from gifts, grants, donations, or appropriations.
         (b)  Money received from a nonprofit organization
  established to provide support to the institute may be used only to
  supplement the salaries of the persons authorized to receive salary
  supplements under this section.
         SECTION 7.  Subchapter B, Chapter 102, Health and Safety
  Code, is amended by adding Sections 102.057 through 102.063 to read
  as follows:
         Sec. 102.057.  PROHIBITED OFFICE LOCATION. An institute
  employee may not have an office in a facility owned by an entity
  receiving or applying to receive money from the institute.
         Sec. 102.058.  CONFLICT OF INTEREST REQUIRING RECUSAL.
  (a)  An oversight committee member, program integration committee
  member, or institute employee shall disclose in writing to the
  chief executive officer if the member, the employee, or a person who
  is related to the member or employee 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.
         (b)  The member or employee described by Subsection (a) shall
  recuse himself or herself from the institute's consideration of
  grant applications from the entity receiving or applying to receive
  money from the institute as provided by Section 102.062(a) or (b),
  as applicable.
         (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, the other
  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 or of a foundation or similar organization affiliated with
  the entity;
               (3)  is an employee of or is negotiating future
  employment with the entity or with a foundation or similar
  organization affiliated with the entity;
               (4)  represents the entity or a foundation or similar
  organization affiliated with the entity;
               (5)  is a professional associate of a primary member of
  the entity's research or prevention program 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 research or prevention
  program team;
               (7)  is engaged or is actively planning to be engaged in
  collaboration with a primary member of the entity's research or
  prevention program team; or
               (8)  has long-standing scientific differences or
  disagreements with a primary member of the entity's research or
  prevention program team, and those differences:
                     (A)  are known to the professional community; and
                     (B)  could be perceived as affecting objectivity.
         (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 in a foundation or similar organization
  affiliated with the entity; or
               (2)  could reasonably foresee that an action taken by a
  research and prevention programs committee, the institute, the
  program integration committee, or the oversight committee could
  result in a financial benefit to the person.
         Sec. 102.059.  STANDARDS OF CONDUCT. (a)  An oversight
  committee member, program integration committee member, or
  institute employee may not:
               (1)  accept or solicit any gift, favor, or service that
  could reasonably influence the member or employee in the discharge
  of official duties or that the member or employee knows or should
  know is being offered with the intent to influence the member's or
  employee's official conduct;
               (2)  accept employment or engage in any business or
  professional activity that would reasonably require or induce the
  member or employee to disclose confidential information acquired in
  the member's or employee's official position;
               (3)  accept other employment or compensation that could
  reasonably impair the member's or employee's independent judgment
  in the performance of official duties;
               (4)  make personal investments or have a financial
  interest that could reasonably create a substantial conflict
  between the member's or employee's private interest and the member's
  or employee's official duties;
               (5)  intentionally or knowingly solicit, accept, or
  agree to accept any benefit for exercising the member's official
  powers or performing the member's or employee's official duties in
  favor of another;
               (6)  lease, directly or indirectly, any property,
  capital equipment, employee, or service to any entity that receives
  a grant from the institute; or
               (7)  serve on the board of directors of a nonprofit
  organization established with a grant from the institute.
         (b)  Notwithstanding Section 102.058, an oversight committee
  member or the member's spouse may not:
               (1)  submit a grant application for funding by the
  institute;
               (2)  be employed by or participate in the management of
  an entity receiving money from the institute;
               (3)  own or control, directly or indirectly, a
  financial interest in an entity receiving money from the institute;
  or
               (4)  use or receive a substantial amount of tangible
  goods, services, or money from the institute other than
  reimbursement authorized for attendance or expenses.
         (c)  An oversight committee member, program integration
  committee member, institute employee, or individual related to the
  member or employee within the second degree of affinity or
  consanguinity may not serve on the board of directors or other
  governing board of a nonprofit organization established to provide
  support to the institute.
         (d)  An employee of a nonprofit organization established
  with a grant from the institute may not serve on the institute's
  commercialization review council.
         (e)  The institute may not participate in a business decision
  of a nonprofit organization established with a grant from the
  institute.
         Sec. 102.060.  INVESTIGATION OF CONFLICTS OF INTEREST.
  (a)  An oversight committee member, a program integration
  committee member, a research and prevention programs committee
  member, or an institute employee shall immediately notify the chief
  executive officer of a conflict of interest, including a
  professional or financial interest described by Section 102.058 or
  102.156.  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 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, 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.
         Sec. 102.061.  FINAL DETERMINATION OF 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 a conflict of interest, 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 research
  and prevention programs 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 an investigation.
         (d)  Unless specifically determined by the chief executive
  officer, or, 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. 102.062.  DISCLOSURE OF CONFLICT OF INTEREST. (a)  If
  an oversight committee member or program integration committee
  member has a conflict of interest, including a professional or
  financial interest described by Section 102.058, regarding an
  application that comes before the member for review or other
  action, the member shall:
               (1)  notify the chief executive officer, as provided by
  Section 102.058, 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,
  including a professional or financial interest described by Section
  102.058, regarding an application that comes before the employee
  for review or other action, the employee shall:
               (1)  notify 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)  An oversight committee member, program integration
  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 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.
         (d)  An oversight committee member, program integration
  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. 102.063.  ADDITIONAL DUTIES OF COMPLIANCE OFFICER.
  (a)  The compliance officer shall adopt and implement a policy on
  in-state or out-of-state residency requirements for members of the
  institute's commercialization review council.
         (b)  The compliance officer shall retain documentation
  relating to:
               (1)  each grant recipient's financial reports,
  including the amount of matching funds dedicated to the specific
  grant proposal;
               (2)  each grant recipient's progress reports; and
               (3)  institute reviews of the financial reports and
  progress reports.
         (c)  The compliance officer shall adopt and implement a
  system to track the date on which a grant recipient's report:
               (1)  is due; and
               (2)  is received by the institute.
         (d)  The compliance officer shall inquire into and monitor
  the status of any required report that is not timely submitted to
  the institute by a grant recipient.
         (e)  The compliance officer shall develop and implement a
  policy on advance payments to grant recipients.
         (f)  The compliance officer annually shall:
               (1)  verify the amount of matching funds dedicated to
  the specific grant awarded to a grant recipient; and
               (2)  review each grant recipient to ensure that the
  grant recipient is in compliance with the terms and conditions of
  the grant recipient's contract with the institute.
         (g)  If the compliance officer determines that a grant
  recipient has not maintained compliance with the terms and
  conditions of the grant contract, the compliance officer shall
  recommend a remediation plan to the oversight committee to assist
  the grant recipient in complying with the contract.  The oversight
  committee shall approve or disapprove a remediation plan submitted
  by the compliance officer.  If approved, the compliance officer
  shall submit the approved remediation plan to the grant recipient.
         SECTION 8.  Subsections (b) and (e), Section 102.101, Health
  and Safety Code, are amended to read as follows:
         (b)  The oversight committee is composed of the following
  nine [11] 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[;
               [(4)     the comptroller or the comptroller's designee;
  and
               [(5)     the attorney general or the attorney general's
  designee].
         (e)  A person may not be a member of the oversight committee
  if, at the time the person is appointed, the person or the person's
  spouse:
               (1)  is employed by or participates in the management
  of a business entity or other organization receiving money from the
  institute;
               (2)  owns or controls, directly or indirectly, an [more
  than a five percent] interest in a business entity or other
  organization 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.
         SECTION 9.  Subsection (c), Section 102.102, Health and
  Safety Code, is amended to read as follows:
         (c)  If the chief executive officer [director] has knowledge
  that a potential ground for removal exists, the chief executive
  officer [director] 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 [director] 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.
         SECTION 10.  Subsection (a), Section 102.103, Health and
  Safety Code, is amended to read as follows:
         (a)  Oversight committee members appointed by the governor,
  lieutenant governor, and speaker of the house serve at the pleasure
  of the appointing officer for staggered six-year terms, with the
  terms of three members expiring on January 31 of each odd-numbered
  year.
         SECTION 11.  Section 102.104, Health and Safety Code, is
  amended to read as follows:
         Sec. 102.104.  OFFICERS.  (a)  The oversight committee shall
  elect [select] 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 more than two years.
         (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 the employees of the institute.
         SECTION 12.  Section 102.107, Health and Safety Code, is
  amended to read as follows:
         Sec. 102.107.  POWERS AND DUTIES. The oversight committee
  shall:
               (1)  hire a chief [an] executive officer;
               (2)  annually set priorities as prescribed by the
  legislature for each grant program and each category of funded
  research that receives money under this chapter; and
               (3)  consider the priorities set under Subdivision (2)
  in awarding grants under this chapter [director].
         SECTION 13.  Section 102.151, Health and Safety Code, is
  amended by amending Subsections (a-1) and (b) and adding Subsection
  (c) to read as follows:
         (a-1)  The oversight committee shall establish research and
  prevention programs committees.  The chief executive officer
  [director], with approval by simple majority of the members of the
  oversight committee, shall appoint as members of [scientific]
  research and prevention programs committees experts in the field of
  cancer research and prevention.
         (b)  Individuals appointed to [the] research and prevention
  programs committees [committee] may be residents of this state or 
  another state.
         (c)  The chief executive officer, in consultation with the
  oversight committee, shall implement a system to document any
  change in the amount of honorarium paid to a member of a research
  and prevention programs committee, including information
  explaining the basis for changing the amount.
         SECTION 14.  Section 102.152, Health and Safety Code, is
  amended to read as follows:
         Sec. 102.152.  TERMS OF RESEARCH AND PREVENTION PROGRAMS
  COMMITTEE MEMBERS. Members of a research and prevention programs
  committee serve for terms as determined by the chief executive
  officer [director].
         SECTION 15.  Section 102.156, Health and Safety Code, is
  amended by amending Subsections (a) and (c) and adding Subsections
  (d) and (e) to read as follows:
         (a)  A member of a research and prevention programs
  committee, the university advisory committee, or any ad hoc
  committee appointed under this subchapter shall disclose in writing
  to the chief executive officer [director] if the member has a
  professional [an interest in a matter that comes before the
  member's committee] or [has a substantial] financial interest in an
  entity that has a direct interest in a [the] matter that comes
  before the member's committee.
         (c)  A person has a [substantial] financial interest in an
  entity if the person:
               (1)  is an employee, member, director, or officer of
  the entity; or
               (2)  owns or controls, directly or indirectly, an [more
  than a five percent] interest in the entity.
         (d)  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, the other
  governing board, or any committee of 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 research or prevention program applicant's 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 research or prevention
  program applicant's team;
               (7)  is engaged or is actively planning to be engaged in
  collaboration with a primary member of the entity's research or
  prevention program applicant's team; or
               (8)  has long-standing scientific differences or
  disagreements with a primary member of the entity's research or
  prevention program applicant's team, and those differences:
                     (A)  are known to the professional community; and
                     (B)  could be perceived as affecting objectivity.
         (e)  A member of a research and prevention programs committee
  appointed under this chapter may not serve on the board of directors
  or other governing board of an entity receiving a grant from the
  institute or of a foundation or similar organization affiliated
  with the entity.
         SECTION 16.  Section 102.251, Health and Safety Code, is
  amended by amending Subsection (a) and adding Subsections (c), (d),
  and (e) to read as follows:
         (a)  The oversight committee shall issue rules regarding the
  procedure for awarding grants to an applicant under this chapter.  
  The rules must include the following procedures:
               (1)  a research and prevention programs committee shall
  score [review] grant applications and make recommendations to the
  program integration committee, established under Section 102.264,
  and the oversight committee [executive director] regarding the
  award of cancer research grants, including a prioritized list that:
                     (A)  ranks the grant applications in the order the
  committee determines applications should be funded; and
                     (B)  includes information explaining how each
  grant application on the list meets the research and prevention
  programs committee's standards for recommendation;
               (2)  the program integration committee [executive
  director] shall 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)  [that] is substantially based on the list
  submitted by the research and prevention programs committee under
  Subdivision (1); and
                     (C)  [,] to the extent possible, gives priority to
  proposals that:
                           (i)  [(A)]  could lead to immediate or
  long-term medical and scientific breakthroughs in the area of
  cancer prevention or cures for cancer;
                           (ii)  [(B)]  strengthen and enhance
  fundamental science in cancer research;
                           (iii)  [(C)]  ensure a comprehensive
  coordinated approach to cancer research;
                           (iv)  [(D)]  are interdisciplinary or
  interinstitutional;
                           (v) [(E)]  address federal or other major
  research sponsors' priorities in emerging scientific or technology
  fields in the area of cancer prevention or cures for cancer;
                           (vi)  [(F)]  are matched with funds
  available by a private or nonprofit entity and institution or
  institutions of higher education;
                           (vii)  [(G)]  are collaborative between any
  combination of private and nonprofit entities, public or private
  agencies or institutions in this state, and public or private
  institutions outside this state;
                           (viii)  [(H)]  have a demonstrable economic
  development benefit to this state;
                           (ix)  [(I)]  enhance research superiority
  at institutions of higher education in this state by creating new
  research superiority, attracting existing research superiority
  from institutions not located in this state and other research
  entities, or enhancing existing research superiority by attracting
  from outside this state additional researchers and resources; and
                           (x)  [(J)]  expedite innovation and
  commercialization, attract, create, or expand private sector
  entities that will drive a substantial increase in high-quality
  jobs, and increase higher education applied science or technology
  research capabilities; and
               (3)  the institute's chief scientific officer and
  development officer shall compare each grant application submitted
  to the institute to a list of donors from any nonprofit organization
  established to provide support to the institute compiled from
  information made available under Section 102.262(c) before the
  application is submitted to a research and prevention programs
  committee for review and again before any grant is awarded to the
  applicant.
         (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;
               (2)  the application's peer review score assigned by
  the research and prevention programs committee;
               (3)  the pre-grant due diligence reviews of the
  application; and
               (4)  if applicable, the intellectual property reviews
  of the application.
         (d)  The chief executive officer 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)  The institute may not award a grant to an applicant who
  has made a gift or grant to the institute or a nonprofit
  organization established to provide support to the institute.
         SECTION 17.  Section 102.252, Health and Safety Code, is
  amended to read as follows:
         Sec. 102.252.  FUNDING [OVERRIDING] RECOMMENDATIONS.
  (a)  Two-thirds of the members of the [The] oversight committee
  must vote to approve [follow] the funding recommendations of the
  program integration committee [executive director in the order the  
  executive director submits the applications to the oversight
  committee unless two-thirds of the members of the oversight
  committee vote to disregard a recommendation].
         (b)  The oversight committee by majority vote may remove a
  grant application from the funding recommendations submitted to the
  committee by the program integration committee.
         SECTION 18.  Subsections (b), (c), and (d), Section 102.255,
  Health and Safety Code, are amended to read as follows:
         (b)  Before awarding a grant under Subchapter E, the
  committee shall enter into a written contract with the grant
  recipient.  The contract may specify that:
               (1)  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; [and]
               (2)  if, as of a date specified in the contract, the
  grant recipient has not used grant money awarded under Subchapter E
  for the purposes for which the grant was intended, the recipient
  shall repay that amount and any related interest applicable under
  the contract to the state at the agreed rate and on the agreed
  terms; and
               (3)  if, as a result of an annual review required under
  Section 102.063, the compliance officer determines the grant
  recipient has not complied with the terms and conditions of the
  grant contract and refuses to comply with a remediation plan
  approved by the oversight committee, the recipient shall repay the
  grant money awarded under Subchapter E and any related interest
  applicable under the contract to this state at the agreed rate and
  on the agreed terms.
         (c)  The contract must:
               (1)  include terms relating to intellectual property
  rights consistent with the standards developed by the oversight
  committee under Section 102.256;
               (2)  require, in accordance with Subsection (d), the
  grant recipient to dedicate an amount of matching funds equal to
  one-half of the amount of the grant awarded; and
               (3)  specify:
                     (A)  the amount of matching funds to be dedicated
  under Subdivision (2);
                     (B)  the period in which the grant award must be
  spent;
                     (C)  the name of the specific project to which
  matching funds are to be dedicated; and
                     (D)  the specific deliverables of the research
  that is the subject of the grant proposal.
         (d)  Before the oversight committee may make for cancer
  research any grant of any proceeds of the bonds issued under
  Subchapter E, the recipient of the grant must have an amount of
  funds equal to one-half of the grant and dedicate those funds
  [dedicated] to the specific research that is the subject of the
  grant request.
         SECTION 19.  Subsections (b) and (c), Section 102.260,
  Health and Safety Code, are amended to read as follows:
         (b)  The chief executive officer [director] shall determine
  the grant review process under this section.  The chief executive
  officer [director] may terminate grants that do not meet
  contractual obligations.
         (c)  The chief executive officer [director] shall report at
  least annually to the oversight committee on the progress and
  continued merit of each research program funded by the institute.
         SECTION 20.  Section 102.262, Health and Safety Code, is
  amended by adding Subsection (c) to read as follows:
         (c)  The records of the institute and of a nonprofit
  organization established to provide support to the institute shall,
  to the extent the records pertain specifically to any gift, grant,
  or other consideration provided by the organization to the
  institute, an employee of the institute, or a member of a committee
  of the institute, be made available to the public.  A record that is
  available under this subsection is public information subject to
  Chapter 552, Government Code.
         SECTION 21.  Subchapter F, Chapter 102, Health and Safety
  Code, is amended by adding Sections 102.263 and 102.264 to read as
  follows:
         Sec. 102.263.  COMPLIANCE PROGRAM.  (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 compliance officer.  
  The institute may establish procedures, such as 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 are confidential:
               (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; and
               (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.
         (d)  Subsection (c) does not apply to information related to
  an individual who consents to disclosure of the information.
         (e)  Information is excepted from disclosure under Chapter
  552, Government Code, if it is collected or produced in a compliance
  program investigation and releasing the information would
  interfere with an ongoing compliance investigation.
         (f)  Information made confidential or excepted from public
  disclosure by this section may be made available to the following on
  request in compliance with applicable law and procedure:
               (1)  a law enforcement agency or prosecutor;
               (2)  a governmental agency responsible for
  investigating the 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.
         (g)  A disclosure under Subsection (f) is not a voluntary
  disclosure for purposes of Section 552.007, Government Code.
         Sec. 102.264.  PROGRAM INTEGRATION COMMITTEE. (a)  The
  institute shall establish a program integration committee.  The
  committee is composed of the following six members:
               (1)  the chief executive officer;
               (2)  the chief scientific officer;
               (3)  the development officer;
               (4)  the commissioner of state health services;
               (5)  the chief prevention officer; and
               (6)  the compliance officer.
         (b)  The committee has the duties assigned under this
  chapter.
         (c)  The chief executive officer shall serve as the presiding
  officer of the program integration committee.
         SECTION 22.  (a)  As soon as practicable after the effective
  date of this Act, the Cancer Prevention and Research Institute of
  Texas Oversight Committee shall adopt the rules necessary to
  implement the changes in law made by this Act.
         (b)  The changes in law made by this Act apply only to a grant
  application submitted to the Cancer Prevention and Research
  Institute of Texas on or after the effective date of this Act.  A
  grant application submitted before the effective date of this Act
  is governed by the law in effect on the date the application was
  submitted, and that law is continued in effect for that purpose.
         (c)  Not later than January 1, 2014, employees, oversight
  committee members, and members of other committees of the Cancer
  Prevention and Research Institute of Texas must comply with the
  changes in law made by this Act regarding the qualifications of the
  employees and members.
         (d)  Not later than December 1, 2013, the Cancer Prevention
  and Research Institute of Texas Oversight Committee shall employ a
  compliance officer and a chief executive officer as required by
  Subsection (c), Section 102.051, and Section 102.0511, Health and
  Safety Code, as added by this Act.
         (e)  As soon as practicable after the effective date of this
  Act, the Cancer Prevention and Research Institute of Texas
  Oversight Committee shall establish a compliance program as
  required by Section 102.263, Health and Safety Code, as added by
  this Act.
         SECTION 23.  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, 2013.
 
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