S.B. No. 149

	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.  Subchapter A, Chapter 102, Health and Safety
	Code, is amended by adding Section 102.004 to read as follows:
	Sec. 102.004.  STATE AUDITOR.  Nothing in this chapter
	limits the authority of the state auditor under Chapter 321,
	Government Code, or other law.
	SECTION 3.  Section 102.051, Health and Safety Code, is
	amended by amending Subsection (a) and adding Subsections (c) and
	(d) to read as follows:
	(a)  The institute [may]:
	(1)  may 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)  may 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)  may 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)  may [employ an executive director as determined by
	the oversight committee;
	[(5)]  employ necessary staff to provide
	administrative support; [and]
	(5)  shall continuously [(6)] monitor contracts and
	agreements authorized by this chapter and ensure that each grant
	recipient complies with the terms and conditions of the grant
	contract;
	(6)  shall ensure that all grant proposals comply with
	this chapter and rules adopted under this chapter before the
	proposals are submitted to the oversight committee for approval;
	and
	(7)  shall establish procedures to document that 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.
	(c)  The institute shall employ a chief compliance officer to
	monitor and report to the oversight committee regarding compliance
	with this chapter and rules adopted under this chapter.
	(d)  The chief compliance officer shall:
	(1)  ensure that all grant proposals comply with this
	chapter and rules adopted under this chapter before the proposals
	are submitted to the oversight committee for approval; and
	(2)  attend and observe the meetings of the program
	integration committee to ensure compliance with this chapter and
	rules adopted under this chapter.
	SECTION 4.  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.
	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;
	(2)  one chief operating officer;
	(3)  one chief product development officer; and
	(4)  one chief prevention officer.
	(d)  The officers described by Subsections (c)(1)-(4) shall
	report directly to the chief executive officer and assist the chief
	executive officer in collaborative outreach to further cancer
	research and prevention.
	SECTION 5.  The heading to Section 102.052, Health and
	Safety Code, is amended to read as follows:
	Sec. 102.052.  ANNUAL PUBLIC REPORT; INTERNET POSTING.
	SECTION 6.  Section 102.052, Health and Safety Code, is
	amended by amending Subsection (a) and adding Subsection (c) to
	read as follows:
	(a)  Not later than January 31 of each year, the institute
	shall submit to the lieutenant governor, the speaker of the house of
	representatives, the governor, and the standing committee of each
	house of the legislature with primary jurisdiction over institute
	matters and post on the institute's Internet website a report
	outlining [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;
	(9)  a statement of the institute's compliance program
	activities, including any proposed legislation or other
	recommendations identified through the activities; and
	(10)  for the previous 12 months, a list of any
	conflicts of interest under this chapter or rules adopted under
	this chapter, any conflicts of interest that require recusal under
	Section 102.1061, any unreported conflicts of interest confirmed by
	an investigation conducted under Section 102.1063, including any
	actions taken by the institute regarding an unreported conflict of
	interest and subsequent investigation, and any waivers granted
	through the process established under Section 102.1062.
	(c)  The institute shall post on the institute's Internet
	website the list described by Subsection (a)(10).
	SECTION 7.  Subchapter B, Chapter 102, Health and Safety
	Code, is amended by adding Section 102.0535 to read as follows:
	Sec. 102.0535.  GRANT RECORDS. (a)  The institute shall
	maintain complete records of:
	(1)  the review of each grant application submitted to
	the institute, including the score assigned to each grant
	application reviewed by a research and prevention programs
	committee in accordance with rules adopted under Section
	102.251(a)(1), even if the grant application is not funded by the
	institute or is withdrawn after submission to the institute;
	(2)  each grant recipient's financial reports,
	including the amount of matching funds dedicated to the research
	specified for the grant award;
	(3)  each grant recipient's progress reports;
	(4)  for the purpose of determining any conflict of
	interest, the identity of each principal investor and owner of each
	grant recipient as provided by institute rules; and
	(5)  the institute's review of the grant recipient's
	financial reports and progress reports.
	(b)  The institute shall have periodic audits made of any
	electronic grant management system used to maintain records of
	grant applications and grant awards under this section.  The
	institute shall address in a timely manner each weakness identified
	in an audit of the system.
	SECTION 8.  Section 102.056, Health and Safety Code, is
	amended to read as follows:
	Sec. 102.056.  SALARY. (a)  The institute may not
	supplement the salary of any institute employee with a gift or grant
	received by the institute.
	(b)  The institute may supplement the salary of the chief
	scientific officer [executive director and other senior institute
	staff members].  Funding for a salary supplement for the chief
	scientific officer may only come from legislative [gifts, grants,
	donations, or] appropriations or bond proceeds.
	(c)  The institute may not supplement the salary of the chief
	executive officer.  The salary of the chief executive officer may
	only be paid from legislative appropriations.
	SECTION 9.  Subchapter B, Chapter 102, Health and Safety
	Code, is amended by adding Section 102.057 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.
	SECTION 10.  Section 102.101, Health and Safety Code, is
	amended by amending Subsections (b), (d), and (e) and adding
	Subsection (f) 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].
	(d)  In making appointments to the oversight committee, the
	governor, lieutenant governor, and speaker of the house of
	representatives:
	(1)  must each appoint at least one person who is a
	physician or a scientist with extensive experience in the field of
	oncology or public health; and
	(2)  should attempt to include cancer survivors and
	family members of cancer patients if possible.
	(e)  A person may not be a member of the oversight committee
	if 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.
	(f)  A person appointed to the oversight committee shall
	disclose to the institute each political contribution to a
	candidate for a state or federal office over $1,000 made by the
	person in the five years preceding the person's appointment and
	each year after the person's appointment until the person's term
	expires.  The institute annually shall post a report of the
	political contributions made by oversight committee members on the
	institute's publicly accessible Internet website and post a link to
	the report on the oversight committee's main Internet web page.
	SECTION 11.  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 12.  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 office for staggered six-year terms, with the
	terms of three members expiring on January 31 of each odd-numbered
	year.
	SECTION 13.  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 in the position to which the officer was elected for
	two consecutive terms.
	(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 14.  Section 102.106, Health and Safety Code, is
	amended to read as follows:
	Sec. 102.106.  CONFLICT OF INTEREST.  (a)  The oversight
	committee shall adopt conflict-of-interest rules, based on
	standards applicable to members of scientific review committees of
	the National Institutes of Health, to govern members of the
	oversight committee, the program integration committee, the
	research and prevention programs committees, and institute
	employees.
	(b)  An institute employee, oversight committee member,
	program integration committee member, or research and prevention
	programs committee member shall recuse himself or herself, as
	provided by Section 102.1061(a), (b), or (c) as applicable, if the
	employee or member, or a person who is related to the employee or
	member 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.
	(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, another
	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
	the institute, a research and prevention programs committee, the
	program integration committee, or the oversight committee could
	result in a financial benefit to the person.
	(e)  Nothing in this chapter limits the authority of the
	oversight committee to adopt additional conflict-of-interest
	standards.
	SECTION 15.  Subchapter C, Chapter 102, Health and Safety
	Code, is amended by adding Sections 102.1061 through 102.1064 to
	read as follows:
	Sec. 102.1061.  DISCLOSURE OF CONFLICT OF INTEREST; RECUSAL.
	(a)  If an oversight committee member or program integration
	committee member has a conflict of interest as described by Section
	102.106 regarding an application that comes before the member for
	review or other action, the member shall:
	(1)  provide written notice to the chief executive
	officer 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
	described by Section 102.106 regarding an application that comes
	before the employee for review or other action, the employee shall:
	(1)  provide written notice to 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)  If a research and prevention programs committee member
	has a conflict of interest described by Section 102.106 regarding
	an application that comes before the member's committee for review
	or other action, the member shall:
	(1)  provide written notice to the chief executive
	officer of the conflict of interest; and
	(2)  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.
	(d)  An oversight committee member, program integration
	committee member, research and prevention programs committee
	member, or institute employee with a conflict of interest may seek a
	waiver as provided by Section 102.1062.
	(e)  An oversight committee member, program integration
	committee member, research and prevention programs 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 requirements 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.
	(f)  An oversight committee member, program integration
	committee member, research and prevention programs 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. 102.1062.  EXCEPTIONAL CIRCUMSTANCES REQUIRING
	PARTICIPATION.  The oversight committee shall adopt rules governing
	the waiver of the conflict-of-interest requirements of this chapter
	under exceptional circumstances for an oversight committee member,
	program integration committee member, research and prevention
	programs committee member, or institute employee.  The rules must:
	(1)  authorize the chief executive officer or an
	oversight committee member to propose the granting of a waiver by
	submitting to the presiding officer of the oversight committee a
	written statement about the conflict of interest, the exceptional
	circumstance requiring the waiver, and any proposed limitations to
	the waiver;
	(2)  require a proposed waiver to be publicly reported
	at a meeting of the oversight committee;
	(3)  require a majority vote of the oversight committee
	members present and voting to grant a waiver;
	(4)  require any waiver granted to be reported annually
	to the lieutenant governor, the speaker of the house of
	representatives, the governor, and the standing committee of each
	house of the legislature with primary jurisdiction over institute
	matters; and
	(5)  require the institute to retain documentation of
	each waiver granted.
	Sec. 102.1063.  INVESTIGATION OF UNREPORTED CONFLICTS OF
	INTEREST. (a)  An oversight committee member, a program
	integration committee member, a research and prevention programs
	committee member, or an institute employee who becomes aware of a
	potential conflict of interest described by Section 102.106 that
	has not been reported shall immediately notify the chief executive
	officer of the potential conflict of interest.  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 unreported 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 or other recommended action related to the
	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 or other action.
	Sec. 102.1064.  FINAL DETERMINATION OF UNREPORTED 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 an unreported conflict of
	interest described by Section 102.1063 or other 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 the 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.
	SECTION 16.  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 that receives money under this
	chapter; and
	(3)  consider the priorities set under Subdivision (2)
	in awarding grants under this chapter [director].
	SECTION 17.  Subchapter C, Chapter 102, Health and Safety
	Code, is amended by adding Sections 102.109 and 102.110 to read as
	follows:
	Sec. 102.109.  CODE OF CONDUCT. (a)  The oversight
	committee shall adopt a code of conduct applicable to each
	oversight committee member, program integration committee member,
	and institute employee.
	(b)  The code of conduct at a minimum must include provisions
	prohibiting the member, the employee, or the member's or employee's
	spouse from:
	(1)  accepting or soliciting any gift, favor, or
	service that could reasonably influence the member or employee in
	the discharge of official duties or that the member, employee, or
	spouse of 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)  accepting employment or engaging 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)  accepting other employment or compensation that
	could reasonably impair the member's or employee's independent
	judgment in the performance of official duties;
	(4)  making personal investments or having 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 soliciting, accepting,
	or agreeing 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)  leasing, directly or indirectly, any property,
	capital equipment, employee, or service to any entity that receives
	a grant from the institute;
	(7)  submitting a grant application for funding by the
	institute;
	(8)  serving on the board of directors of an
	organization established with a grant from the institute; or
	(9)  serving on the board of directors of a grant
	recipient.
	Sec. 102.110.  FINANCIAL STATEMENT REQUIRED. Each member of
	the oversight committee shall file with the chief compliance
	officer a verified financial statement complying with Sections
	572.022 through 572.0252, Government Code, as required of a state
	officer by Section 572.021, Government Code.
	SECTION 18.  Section 102.151, Health and Safety Code, is
	amended by amending Subsections (a-1) and (b) and adding
	Subsections (c) and (e) 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, including qualified trained cancer
	patient advocates who meet the qualifications developed by rule as
	provided by Subsection (c).
	(b)  The institute shall adopt a written policy on in-state
	or out-of-state residency requirements for members of the research
	and prevention programs committees.  [Individuals appointed to the
	research and prevention programs committee may be residents of
	another state.]
	(c)  The oversight committee shall adopt rules regarding the
	qualifications required for an individual who will serve as a
	trained cancer patient advocate committee member for a research and
	prevention programs committee.  The rules must require a trained
	cancer patient advocate to receive science-based training.
	(e)  The chief executive officer, in consultation with the
	oversight committee, shall adopt a policy and 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 19.  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 20.  Subsections (a), (b), and (c), Section 102.156,
	Health and Safety Code, are amended 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, as
	defined by Section 102.106, in an entity that has a direct interest
	in a [the] matter that comes before the member's committee.
	(b)  The member shall recuse himself or herself in the manner
	described by Section 102.1061 from the committee's deliberations
	and actions on the matter in Subsection (a) and may not participate
	in the committee's decision on the matter.
	(c)  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 [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, more
	than a five percent interest in the entity].
	SECTION 21.  Subsections (b) and (c), Section 102.201,
	Health and Safety Code, are amended to read as follows:
	(b)  The cancer prevention and research fund consists of:
	(1)  [patent, royalty, and license fees and other
	income received under a contract entered into as provided by
	Section 102.255;
	[(2)]  appropriations of money to the fund by the
	legislature, except that the appropriated money may not include the
	proceeds from the issuance of bonds authorized by Section 67,
	Article III, Texas Constitution;
	(2) [(3)]  gifts, grants, including grants from the
	federal government, and other donations received for the fund; and
	(3) [(4)]  interest earned on the investment of money
	in the fund.
	(c)  The fund may be used only to pay for:
	(1)  grants for cancer research and for cancer research
	facilities in this state to realize therapies, protocols, and
	medical procedures for the cure or substantial mitigation of all
	types of cancer in humans;
	(2)  the purchase, subject to approval by the
	institute, of laboratory facilities by or on behalf of a state
	agency or grant recipient;
	(3)  grants to public or private persons to implement
	the Texas Cancer Plan;
	(4)  the operation of the institute; [and]
	(5)  grants for cancer prevention and control programs
	in this state to mitigate the incidence of all types of cancer in
	humans; and
	(6)  debt service on bonds issued as authorized by
	Section 67, Article III, Texas Constitution.
	SECTION 22.  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 and prevention 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 product
	development [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
	(xi)  address the goals of the Texas Cancer
	Plan; and
	(3)  the institute's chief compliance 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; and
	(3)  if applicable, the intellectual property and other
	due diligence reviews of the application.
	(d)  A member of the program integration committee 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 23.  Section 102.252, Health and Safety Code, is
	amended to read as follows:
	Sec. 102.252.  FUNDING [OVERRIDING] RECOMMENDATIONS.
	Two-thirds of the members of the [The] oversight committee present
	and voting must vote to approve each [follow the] funding
	recommendation [recommendations] of the program integration
	committee.  If the oversight committee does not approve a funding
	recommendation of the program integration committee, a statement
	explaining the reasons a funding recommendation was not followed
	must be included in the minutes of the meeting [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].
	SECTION 24.  Section 102.255, Health and Safety Code, is
	amended by amending Subsections (b), (c), and (d) and adding
	Subsection (e) 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 the grant recipient fails to meet the terms and
	conditions of the contract, the institute may terminate the
	contract using the written process prescribed in the contract and
	require the recipient to 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 research 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 research project to which
	matching funds are to be dedicated; and
	(D)  the specific deliverables of the project 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 certify that the
	recipient has [have] an amount of funds equal to one-half of the
	grant and dedicate those funds [dedicated] to the research that is
	the subject of the grant request.  The institute shall adopt rules
	specifying how a grant recipient fulfills obligations under this
	subchapter.  At a minimum, the rules must:
	(1)  allow a grant recipient that is a public or private
	institution of higher education, as defined by Section 61.003,
	Education Code, to credit toward the recipient's matching funds the
	dollar amount equivalent to the difference between the indirect
	cost rate authorized by the federal government for research grants
	awarded to the recipient and the indirect cost rate authorized by
	Section 102.203(c);
	(2)  require that a grant recipient certify before the
	distribution of any money awarded under a grant for cancer
	research:
	(A)  that encumbered funds equal to one-half of
	the amount of the total grant award are available and not yet
	expended for research that is the subject of the grant; or
	(B)  if the grant recipient is a public or private
	institution of higher education, the indirect cost rate authorized
	by the federal research grants awarded to the recipient;
	(3)  specify that:
	(A)  a grant recipient receiving more than one
	grant award may provide matching funds certification at an
	institutional level;
	(B)  the recipient of a multiyear grant award may
	certify matching funds on a yearly basis; and
	(C)  grant funds may not be distributed to the
	grant recipient until the annual certification of the matching
	funds has been approved;
	(4)  specify that money used for purposes of
	certification may include:
	(A)  federal funds, including funds provided
	under the American Recovery and Reinvestment Act of 2009 (Pub. L.
	No. 111-5) and the fair market value of drug development support
	provided to the recipient by the National Cancer Institute or other
	similar programs;
	(B)  funds of this state;
	(C)  funds of other states; and
	(D)  nongovernmental funds, including private
	funds, foundation grants, gifts, and donations;
	(5)  specify that the following items do not qualify
	for purposes of the certification required by this subsection:
	(A)  in-kind costs;
	(B)  volunteer services furnished to a grant
	recipient;
	(C)  noncash contributions;
	(D)  income earned by the grant recipient that is
	not available at the time of the award;
	(E)  preexisting real estate of the grant
	recipient, including buildings, facilities, and land;
	(F)  deferred giving, including a charitable
	remainder annuity trust, a charitable remainder unitrust, or a
	pooled income fund; or
	(G)  other items as may be determined by the
	oversight committee;
	(6)  require a grant recipient and the institute to
	include the certification in the grant award contract;
	(7)  specify that a grant recipient's failure to
	provide certification shall serve as grounds for terminating the
	grant award contract;
	(8)  require a grant recipient to maintain adequate
	documentation supporting the source and use of the funds required
	by this subsection and to provide documentation to the institute
	upon request; and
	(9)  require that the institute establish a procedure
	to conduct an annual review of the documentation supporting the
	source and use of funds reported in the required certification.
	(e)  The institute shall adopt a policy on advance payments
	to grant recipients.
	SECTION 25.  Section 102.260, Health and Safety Code, is
	amended by amending Subsections (b) and (c) and adding Subsections
	(d), (e), and (f) 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.
	(d)  The institute shall establish and implement reporting
	requirements to ensure that each grant recipient complies with the
	terms and conditions in the grant contract, including verification
	of the amounts of matching funds dedicated to the research that is
	the subject of the grant award to the grant recipient.
	(e)  The institute shall implement a system to:
	(1)  track the dates on which grant recipient reports
	are due and are received by the institute; and
	(2)  monitor the status of any required report that is
	not timely submitted to the institute by a grant recipient.
	(f)  The chief compliance officer shall monitor compliance
	with this section and at least annually shall inquire into and
	monitor the status of any required report that is not timely
	submitted to the institute by a grant recipient. The chief
	compliance officer shall notify the general counsel and the
	oversight committee of a grant recipient that has not maintained
	compliance with the reporting requirements or matching funds
	provisions of the grant contract to allow the institute to begin
	suspension or termination of the grant contract under Subsection
	(b).  This subsection does not limit other remedies available under
	the grant contract.
	SECTION 26.  Section 102.262, Health and Safety Code, is
	amended by adding Subsections (c) and (d) to read as follows:
	(c)  The records of a nonprofit organization established to
	provide support to the institute are public information subject to
	Chapter 552, Government Code.
	(d)  The institute shall post on the institute's Internet
	website records that pertain specifically to any gift, grant, or
	other consideration provided to the institute, an institute
	employee, or a member of an institute committee.  The posted
	information must include each donor's name and the amount and date
	of the donor's donation.
	SECTION 27.  Subchapter F, Chapter 102, Health and Safety
	Code, is amended by adding Sections 102.263, 102.2631, 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 chief 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 and are not subject to
	disclosure under Chapter 552, Government Code:
	(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;
	(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; and
	(3)  other information that is collected or produced in
	a compliance program investigation if releasing the information
	would interfere with an ongoing compliance investigation.
	(d)  Subsection (c) does not apply to information related to
	an individual who consents to disclosure of the information.
	(e)  Information made confidential or excepted from public
	disclosure by this section may be made available to the following on
	request in compliance with applicable laws and procedures:
	(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.
	(f)  A disclosure under Subsection (e) is not a voluntary
	disclosure for purposes of Section 552.007, Government Code.
	Sec. 102.2631.  COMPLIANCE MATTERS; CLOSED MEETING.  The
	oversight committee may conduct a closed meeting under Chapter 551,
	Government Code, to discuss an ongoing compliance investigation
	into issues related to fraud, waste, or abuse of state resources.
	Sec. 102.264.  PROGRAM INTEGRATION COMMITTEE. (a)  The
	institute shall establish a program integration committee.  The
	committee is composed of the following five members:
	(1)  the chief executive officer;
	(2)  the chief scientific officer;
	(3)  the chief product development officer;
	(4)  the commissioner of state health services; and
	(5)  the chief prevention 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 28.  Chapter 102, Health and Safety Code, is amended
	by adding Subchapter G to read as follows:
	SUBCHAPTER G.  CANCER PREVENTION AND RESEARCH INTEREST AND SINKING
	FUND
	Sec. 102.270.  ESTABLISHMENT OF FUND.  (a)  The cancer
	prevention and research interest and sinking fund is a dedicated
	account in the general revenue fund.
	(b)  The fund consists of:
	(1)  patent, royalty, and license fees and other income
	received under a contract entered into as provided by Section
	102.255; and
	(2)  interest earned on the investment of money in the
	fund.
	(c)  The fund may be used only to pay for debt service on
	bonds issued as authorized by Section 67, Article III, Texas
	Constitution, at a time and in a manner to be determined by the
	legislature in the General Appropriations Act.
	SECTION 29.  (a)  The terms of the members of the Cancer
	Prevention and Research Institute of Texas Oversight Committee
	serving immediately before the effective date of this Act expire on
	the effective date of this Act.
	(b)  As soon as practicable after the effective date of this
	Act, the governor, lieutenant governor, and speaker of the house of
	representatives shall each appoint members to the Cancer Prevention
	and Research Institute of Texas Oversight Committee as required by
	Section 102.101, Health and Safety Code, as amended by this Act.  In
	making the initial appointments under that section, each appointing
	office shall designate one member for a term expiring January 31,
	2015, one member for a term expiring January 31, 2017, and one
	member for a term expiring January 31, 2019.
	SECTION 30.  (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
	chief 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 31.  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.
	______________________________	______________________________
	President of the Senate	Speaker of the House
	I hereby certify that S.B. No. 149 passed the Senate on
	April 3, 2013, by the following vote: Yeas 31, Nays 0; and that
	the Senate concurred in House amendments on May 24, 2013, by the
	following vote: Yeas 31, Nays 0.
	______________________________
	Secretary of the Senate
	I hereby certify that S.B. No. 149 passed the House, with
	amendments, on May 20, 2013, by the following vote: Yeas 140,
	Nays 3, two present not voting.
	______________________________
	Chief Clerk of the House
	Approved:
	______________________________
	Date
	______________________________
	Governor