Relating to efficiency and strategic fiscal reviews of state agencies conducted by the Legislative Budget Board.

89(R) HB 3770 - Engrossed version - Bill Text

89R23179 CS-F

By: Capriglione, Curry, et al.

H.B. No. 3770

A BILL TO BE ENTITLED

AN ACT

relating to efficiency and strategic fiscal reviews of state

agencies conducted by the Legislative Budget Board.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 322.017, Government Code, is amended by

amending Subsections (a), (b), and (c) and adding Subsections

(b-1), (b-2), and (f) to read as follows:

(a) In this section, "state agency" has the meaning assigned

by Section 2056.001
, except that the term includes an institution

of higher education, as defined by Section 61.003, Education Code
.

(b) The board
shall
[
periodically may
] review and analyze

the effectiveness and efficiency of the policies,
programs,

management, fiscal affairs, and operations of state agencies.

(b-1)

The board shall establish a schedule for the review

and analysis conducted under Subsection (b).

Each state fiscal

biennium, the board shall review and analyze at least:

(1)

25 state agencies, which must include at least one

state agency from each article of the General Appropriations Act;

and

(2)

40 programs operated by the state agencies under

review during that biennium, which must include at least one

program operated by each state agency under review.

(b-2)

Not later than June 30 of each odd-numbered year, the

members of the board shall provide to the director a list of

programs to be reviewed under Subsection (b) for that state fiscal

biennium.

(c)
Not later than September 1 of each even-numbered year,

the
[
The
] board shall report the findings of
each
[
the
] review and

analysis to the governor and the legislature.
A report on a

reviewed program must:

(1)

be published in a format prescribed by the board;

and

(2) include:

(A)

recommendations for strategies to improve

effectiveness, efficiency, and service to taxpayers; and

(B) a table that:

(i)

analyzes all costs, savings, cost

avoidance, expected change to state revenue, and any non-fiscal

taxpayer benefit predicted to result from increased program

effectiveness and efficiency if the strategies recommended under

Paragraph (A) were implemented; and

(ii)

presents the information described by

Subparagraph (i) for a five-year period beginning with the

suggested implementation date for the strategies recommended under

Paragraph (A).

(f)

The director shall employ sufficient personnel to carry

out the provisions of this section.

SECTION 2. Section 322.0175, Government Code, is amended to

read as follows:

Sec. 322.0175. STRATEGIC FISCAL REVIEW OF STATE AGENCIES

AND PROGRAMS. (a) The board
may
[
shall
] perform a strategic fiscal

review for
a
[
each
] state agency
if the board determines a review is

appropriate
[
currently the subject of Sunset Advisory Commission

review under Chapter 325 (Texas Sunset Act)
]. The board
may
[
shall
]

not perform a review under this section of state agencies listed in

Section 325.025(b)[
, Government Code,
] because
those
[
these
]

agencies are not subject to the legislative appropriations process.

(b)
If a strategic fiscal review is performed for a state

agency under Subsection (a), the
[
The
] board shall prepare and

submit a report of the findings of the [
strategic fiscal
] review by

September 1 of the even-numbered year of the biennium during which

the review is conducted to the governor, lieutenant governor, and

speaker of the house of representatives and to the members of the

senate finance and house appropriations committees.

(c)
A
[
The
] strategic fiscal review report must contain:

(1) a description of the discrete activities the state

agency is charged with conducting or performing together with:

(A) a justification for each activity by

reference to a statute or other legal authority; and

(B) an evaluation of the effectiveness and

efficiency of the state agency's policies, management, fiscal

affairs, and operations in relation to each activity;

(2) for each activity identified under Subdivision

(1):

(A) a quantitative estimate of any adverse

effects that reasonably may be expected to result if the activity

were discontinued, together with a description of the methods by

which the adverse effects were estimated;

(B) an itemized account of expenditures required

to maintain the activity at the minimum level of service or

performance required by the statute or other legal authority,

together with a concise statement of the quantity and quality of

service or performance required at that minimum level; and

(C) an itemized account of expenditures required

to maintain the activity at the current level of service or

performance, together with a concise statement of the quantity and

quality of service or performance provided at that current level;

(3) a ranking of activities identified under

Subdivision (1) that illustrates the relative importance of each

activity to the overall goals and purposes of the state agency at

current service or performance levels; and

(4) recommendations to the legislature regarding

whether the legislature should continue funding each activity

identified under Subdivision (1) and, if so, at what level.

(d) The legislature may consider [
the
] strategic fiscal

review reports in connection with the legislative appropriations

process.

(e)
If the board performs a strategic fiscal review under

Subsection (a)
[
Until the board has completed a strategic fiscal

review under this section
], all information, documentary or

otherwise, prepared or maintained in conducting the strategic

fiscal review or preparing the strategic fiscal review report,

including intra-agency and interagency communications and drafts

of the strategic fiscal review report, or portions of those drafts,

is excepted from required public disclosure as audit working papers

under Section 552.116
until the review is completed
. This

subsection does not affect whether information described by this

subsection is confidential or excepted from required public

disclosure under a law other than Section 552.116.

SECTION 3. Sections 322.011, 322.0165, and 322.0171,

Government Code, are repealed.

SECTION 4. Notwithstanding Section 322.017(b-1),

Government Code, as added by this Act, for the state fiscal biennium

ending August 31, 2027, the Legislative Budget Board is required to

review and analyze:

(1) 12 state agencies; and

(2) 20 programs operated by the 12 state agencies

reviewed during that state fiscal biennium.

SECTION 5. This Act takes effect September 1, 2025.