HB 5352

relating to the establishment of the State Blockchain Technology
Pilot Program by the Department of Information Resources.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Chapter 2054, Government Code, is amended by
adding Subchapter T to read as follows:
SUBCHAPTER T.  STATE BLOCKCHAIN TECHNOLOGY PILOT PROGRAM
Sec. 2054.701.  DEFINITIONS.  In this subchapter:
(1)  "Blockchain" means a distributed ledger
technology that records transactions in a verifiable and immutable
manner, shared across multiple nodes in a network, ensuring
(2)  "Program" means the State Blockchain Technology
Pilot Program established under Section 2054.702.
(3)  "Program participant" means the state agency
selected by the governor to participate in the program under
Sec. 2054.702.  ESTABLISHMENT OF PROGRAM.  (a)  The board
shall establish a pilot program to explore the application and
benefits of the use of blockchain technology by the program
participant for the purpose of improving transparency, security,
and efficiency in government operations.
(b)  The program shall study the use of blockchain by the
(1)  to streamline the secure storage and retrieval of
(2)  to improve the transparency of procurement
processes and tracking of goods or services utilized by the program
(3)  to test secure methods for identity verification
(A)  employees of the program participant;
(B)  contractors of the program participant; and
(C)  citizens that interact with the program
(4)  to enhance mechanisms for fraud detection and
(5)  for any other application to improve public
services or administrative efficiency, as determined by the program
participant, the governor, or the department.
(c)  In administering the program, the department shall
ensure compliance with cybersecurity and privacy measures.
Sec. 2054.703.  SELECTION OF PROGRAM PARTICIPANT.  (a)  The
governor shall select a state agency to serve as the program
(b)  The board shall provide the governor with
recommendations on the selection of the program participant based
(1)  the feasibility of implementing the program by the
(2)  the budget appropriated by the legislature to the
(3)  the anticipated disruption to existing services of
(4)  the anticipated efficacy of the program on
existing services of the program participant; and
(5)  cybersecurity and confidentiality concerns.
Sec. 2054.704.  REPORT.  (a)  Not later than January 1, 2029,
the department shall submit to the governor, lieutenant governor,
and members of the legislature a report documenting the outcomes of
the program.  The report must include:
(1)  an evaluation of the benefits and challenges of
implementing blockchain technology in the program participant's
(2)  an assessment of the cost-effectiveness of the
blockchain solution compared to existing systems of the program
(3)  a determination of feasibility on whether
blockchain should be expanded to other state agencies or
(4)  any identified risks, security concerns, or
regulatory barriers encountered during the program.
(b)  The department may contract with a private entity to
prepare the report required under this section.
Sec. 2054.705.  COLLABORATION.  (a)  For the purposes of
satisfying the requirements of Section 2054.702, the department
shall collaborate with a state university that operates:
(1)  a statewide technology center for data established
(2)  a regional network security center established
(b)  The department may collaborate or contract with private
technology firms or consultants for technical expertise or
assistance in implementing the program.
Sec. 2054.706.  FUNDING.  (a)  Funding for the program
(1)  money appropriated by the legislature for the
(2)  gifts, grants, and donations received under
(3)  any other money available for the purposes of the
(b)  If the amount available under Subsection (a) is less
than the costs to administer the program, the governor and the
Legislative Budget Board may transfer or repurpose money under a
proposal under Chapter 317 to provide additional funding to
(c)  The department may solicit and accept gifts, grants, and
donations from any public or private source.
(d)  Not later than January 1, 2029, the department shall
transfer all unspent funds to the general revenue fund.
Sec. 2054.707.  RULES.  The department shall adopt rules
necessary to administer the pilot program.
Sec. 2054.708.  EXPIRATION.  This subchapter expires
SECTION 2.  (a)  Not later than December 1, 2025, the
Department of Information Resources shall adopt rules necessary to
implement and administer the State Blockchain Technology Pilot
Program established under Section 2054.702, Government Code, as
(b)  As soon as practicable after the effective date of this
Act, the Department of Information Resources shall prepare and
submit the list of recommended state agencies required by Section
2054.703, Government Code, as added by this Act.
(c)  Not later than 15 business days after receiving the list
of recommended state agencies, the governor shall select a state
agency to participate in the State Blockchain Technology Pilot
Program as required by Section 2054.703, Government Code, as added
SECTION 3.  It is the intent of the legislature that every
provision, section, subsection, sentence, clause, phrase, or word
in this Act, and every application of the provisions in this Act to
every person, group of persons, or circumstances, is severable from
each other.  If any application of any provision in this Act to any
person, group of persons, or circumstances is found by a court to be
invalid for any reason, the remaining applications of that
provision to all other persons and circumstances shall be severed
SECTION 4.  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, 2025.