SB 2403

relating to the functions and duties of the Texas Ethics
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Section 254.036(b), Election Code, is amended to
(b)  Except as provided by Subsection [(c) or] (e), each
report filed under this chapter with the commission must be filed by
computer diskette, modem, or other means of electronic transfer,
using computer software provided by the commission or computer
software that meets commission specifications for a standard file
SECTION 2.  Section 254.038(c), Election Code, is amended to
(c)  A report under this section shall be filed
electronically, by telephonic facsimile machine, or by hand, in the
form required by Section 254.036.  The commission must receive a
report under this section filed by telephonic facsimile machine or
hand not later than 5 p.m. of the first business day after the date
the contribution is accepted.  The commission must receive a report
under this section filed electronically not later than midnight of
the first business day after the date the contribution is accepted.
A report under this section is not required to be accompanied by the
affidavit required under Section 254.036(h) or to be submitted on a
form prescribed by the commission.  [A report under this section
that complies with Section 254.036(a) must be accompanied by an
affidavit under Section 254.036(c)(1) unless the candidate or
committee has submitted an affidavit under Section 254.036(c)(1)
with another report filed in connection with the election for which
a report is required under this section.]
SECTION 3.  Section 254.039(a-1), Election Code, is amended
(a-1)  A report under this section shall be filed
electronically, by telephonic facsimile machine, or by hand, in the
form required by Section 254.036.  The commission must receive a
report under this section not later than 5 p.m. of the first
business day after the date the contribution is accepted or the
expenditure is made.  A report under this section is not required to
be accompanied by the affidavit required under Section 254.036(h)
or to be submitted on a form prescribed by the commission.  [A
report under this section that complies with Section 254.036(a)
must be accompanied by an affidavit under Section 254.036(c)(1)
unless the committee has submitted an affidavit under Section
254.036(c)(1) with another report filed in connection with the
election for which a report is required under this section.]
SECTION 4.  Sections 254.042(a) and (b), Election Code, are
(a)  The commission shall determine from any available
evidence whether a report required to be filed with the commission
under this chapter is late.  On making that determination, the
commission shall immediately provide [mail a notice of the
determination] to the person required to file the report notice of
(b)  If a report other than a report under Section
254.064(c), 254.124(c), or 254.154(c) [or the first report under
Section 254.063 or 254.123] that is required to be filed following
the primary or general election is determined to be late, the person
required to file the report is liable to the state for a civil
penalty of $500.  If a report under Section 254.064(c), 254.124(c),
or 254.154(c) [or the first report under Section 254.063 or
254.153] that is required to be filed following the primary or
general election is determined to be late, the person required to
file the report is liable to the state for a civil penalty of $500
for the first day the report is late and $100 for each day
thereafter that the report is late and continuing only through the
day of the election.  If a report is more than 30 days late, the
commission shall issue a warning of liability [by registered mail]
to the person required to file the report.  If the penalty is not
paid before the 10th day after the date on which the warning is
received, the person is liable for a civil penalty in an amount
determined by commission rule, but not to exceed $10,000.
SECTION 5.  Sections 254.157 and 254.158, Election Code, are
Sec. 254.157.  MONTHLY REPORTING SCHEDULE.  (a)  The
campaign treasurer of a general-purpose committee filing monthly
reports shall file a report not later than the 10th [fifth] day of
the month following the period covered by the report.  A report
covering the month preceding an election in which the committee is
involved must be received by the authority with whom the report is
required to be filed not later than the 10th [fifth] day of the
month following the period covered by the report.
(b)  A monthly report covers the period beginning the first
[26th] day of each month and continuing through the last [25th] day
of the [following] month[, except that the period covered by the
first report begins January 1 and continues through January 25].
Sec. 254.158.  EXCEPTION TO MONTHLY REPORTING SCHEDULE.  If
the campaign treasurer appointment of a general-purpose committee
filing monthly reports is filed after January 1 of the year in which
monthly reports are filed, the period covered by the first monthly
report begins the day the appointment is filed and continues
through the last [25th] day of the month in which the appointment is
filed [unless the appointment is filed the 25th or a succeeding day
of the month.  In that case, the period continues through the 25th
day of the month following the month in which the appointment is
SECTION 6.  Sections 305.033(a) and (c), Government Code,
are amended to read as follows:
(a)  The commission shall determine from any available
evidence whether a registration or report required to be filed with
the commission under this chapter is late.  A registration filed
without the fee required by Section 305.005 is considered to be
late.  On making a determination that a required registration or
report is late, the commission shall immediately provide [mail a
notice of the determination] to the person responsible for the
filing, [to] the commission, and [to] the appropriate attorney for
the state notice of the determination.
(c)  If a registration or report is more than 30 days late,
the commission shall issue a warning of liability [by registered
mail] to the person responsible for the filing.  If the penalty is
not paid before the 10th day after the date on which the warning is
received, the person is liable for a penalty in an amount determined
by commission rule, but not to exceed $10,000.
SECTION 7.  Section 305.034(b), Government Code, is amended
(b)  If [Whenever] the commission determines that a person
has failed to file any required form, statement, or report as
required by this chapter, the commission shall provide [send a
written statement of this finding] to the person written notice of
the determination [involved].  [Notice to the person involved must
SECTION 8.  Section 571.022, Government Code, is amended to
Sec. 571.022.  SUNSET PROVISION.  The commission is subject
to review under Chapter 325 (Texas Sunset Act), but is not abolished
under that chapter.  The commission shall be reviewed during the
periods in which state agencies abolished in 2037 [2013] and every
12th year after that year are reviewed.
SECTION 9.  Section 571.0271, Government Code, is amended by
amending Subsection (b) and adding Subsection (d) to read as
(b)  The training program must provide the person with
(1)  the law governing [legislation that created the]
(2)  the programs, functions, rules, and budget of
(3)  the scope of and limitations on the rulemaking
authority [role and functions] of the commission;
(4)  [the rules of the commission, with an emphasis on
the rules that relate to disciplinary and investigatory authority;
[(5)  the current budget for the commission;
[(6)]  the results of the most recent formal audit of
(5) [(7)]  the requirements of:
(A)  laws relating to [the] open meetings [law],
public information, administrative procedure, and disclosing
conflicts-of-interest [Chapter 551]; and
(B)  [the public information law, Chapter 552;
[(C)  the administrative procedure law, Chapter
[(D)]  other laws applicable to members of a state
policy-making body in performing their duties [relating to public
officials, including conflict-of-interest laws]; and
(6) [(8)]  any applicable ethics policies adopted by
(d)  The executive director of the commission shall create a
training manual that includes information required by Subsection
(b).  The executive director shall distribute a copy of the training
manual annually to each member of the commission.  Each member of
the commission shall sign and submit to the executive director a
statement acknowledging that the member received and has reviewed
SECTION 10.  Subchapter B, Chapter 571, Government Code, is
amended by adding Section 571.033 to read as follows:
Sec. 571.033.  METHOD OF PROVIDING NOTICE.  (a)  The
commission by rule shall prescribe the method by which the
commission will provide a notice required by:
(b)  The method the commission prescribes under Subsection
(a) for providing notice may include electronic mail.
SECTION 11.  Section 571.064(b), Government Code, is amended
(b)  If a law, other than Sections 305.005(g) and (g-1),
administered and enforced by the commission sets dollar amounts or
categories of amounts as reporting thresholds or if the commission
sets those amounts, the commission [annually] shall decennially
adjust those thresholds [upward to the nearest multiple of $10] in
accordance with the percentage increase for the previous year in
the Consumer Price Index for Urban Consumers published by the
Bureau of Labor Statistics of the United States Department of Labor
(1)  the nearest multiple of $10 if the amount is less
(2)  the nearest multiple of $100 if the amount is $100
or more but less than $10,000; or
(3)  the nearest multiple of $1,000 if the amount is
SECTION 12.  The heading to Subchapter E, Chapter 571,
Government Code, is amended to read as follows:
SUBCHAPTER E.  CATEGORIZATION OF VIOLATIONS; COMPLAINT PROCEDURES
SECTION 13.  Section 571.1211, Government Code, is amended
by amending Subdivisions (2) and (3) and adding Subdivision (4) to
(2)  "Category One violation" means a technical,
clerical, or de minimis violation of a law within jurisdiction of
the commission [as to which it is generally not difficult to
ascertain whether the violation occurred or did not occur,
[(A)  the failure by a person required to file a
[(i)  file the required statement or report
in a manner that complies with applicable requirements; or
[(ii)  timely file the required statement or
[(B)  a violation of Section 255.001, Election
[(C)  a misrepresentation in political
advertising or a campaign communication relating to the office held
by a person in violation of Section 255.006, Election Code;
[(D)  a failure to include in any written
political advertising intended to be seen from a road the
right-of-way notice in violation of Section 259.001, Election Code;
[(E)  a failure to timely respond to a written
notice under Section 571.123(b)].
(3)  "Category Two violation" means a violation of a
law within the jurisdiction of the commission that is not a Category
One violation or a Category Three violation.
(4)  "Category Three violation" means a serious
violation of a law within the jurisdiction of the commission.
SECTION 14.  Subchapter E, Chapter 571, Government Code, is
amended by adding Sections 571.1213, 571.1232, and 571.1233 to read
Sec. 571.1213.  CATEGORIZATION OF VIOLATIONS.  (a)  The
commission shall categorize each violation of law within the
commission's jurisdiction as a Category One violation, a Category
Two violation, or a Category Three violation.  A violation of law
may by categorized as more than one category of violation.  In
determining the category of a violation, the commission shall
(1)  the dollar amount at issue for a violation;
(2)  the timing of the report relative to an election or
(3)  the penalty of any criminal offense associated
(4)  the potential a violation has to:
(A)  conceal evidence of a person's influence over
(B)  distort a public disclosure; and
(5)  any other consideration the commission determines
necessary to prevent harm to the public.
(b)  The commission shall publish on the commission's
Internet website the violation categorizations described by
(c)  Before the commission adopts a new violation
categorization or changes an existing violation categorization
described by Subsection (a), the commission shall:
(1)  publish the proposed violation categorization in
the Texas Register for a period determined by commission rule; and
(2)  hold an open meeting to obtain public comment on
the proposed violation categorization.
Sec. 571.1232.  POLICY ON PRIORITIZING COMPLAINTS.  (a)  The
commission shall adopt a written policy on prioritizing the
investigation of sworn complaints in accordance with this
subchapter based on the risk the commission determines the
violation alleged in the complaint poses to public disclosure
(b)  In adopting the policy, the commission shall ensure a
sworn complaint is prioritized based on:
(1)  the category of the violation alleged in the
(2)  whether evidence exists demonstrating an intent in
connection with the violation alleged in the complaint to conceal a
person's influence over a public official or distort a public
(3)  the compliance record of the respondent with laws
within the commission's jurisdiction based on:
(A)  previous sworn complaints filed against the
(B)  repeat violations committed by the
(C)  any reviews the commission conducted under
Section 571.069 of a statement or report filed by the respondent;
(4)  negative media attention of the matter that is the
(5)  any other risk-based factors the commission
(c)  The policy the commission adopts under this section must
include a process for the commission to reprioritize the
investigation of a sworn complaint as the commission determines
(1)  publish on the commission's Internet website the
policy the commission adopts under this section; and
(2)  train commission staff on using the policy in
(e)  Before the commission adopts or changes the policy
required by this section, the commission shall:
(1)  publish the proposed policy in the Texas Register
for a period determined by commission rule; and
(2)  hold an open meeting to obtain public comment on
Sec. 571.1233.  DISCOVERY REQUIREMENTS.  The commission
shall adopt rules that prescribe the procedure required of
commission staff and respondents to agree to a discovery control
plan to conduct discovery in connection with a sworn complaint.  The
(1)  outline a period during which all discovery must
be completed and set appropriate limits to the amount of discovery
(2)  comply with the Texas Rules of Civil Procedure,
except that the commission shall determine the level of discovery
under Rule 190, Texas Rules of Civil Procedure, appropriate for the
category of the violation alleged in a complaint and the policies
the commission adopts under Section 571.1232 on prioritizing the
SECTION 15.  Section 571.124(e), Government Code, is amended
(e)  If the executive director determines that the
commission has jurisdiction, the notice under Section 571.123(b)
(1)  a statement that the commission has jurisdiction
over the violation of law alleged in the complaint;
(2)  a statement of whether the complaint will be
processed as a Category One violation, [or] a Category Two
violation, or a Category Three violation [, subject to
reconsideration as provided for by Section 571.1212];
(3)  the date by which the respondent is required to
(4)  a copy of the complaint and the rules of procedure
(5)  a statement of the rights of the respondent;
(6)  a statement inviting the respondent to provide to
the commission any information relevant to the complaint; and
(7)  a statement that a failure to timely respond to the
notice will be treated as a separate violation.
SECTION 16.  Section 571.1244, Government Code, is amended
Sec. 571.1244.  PRELIMINARY REVIEW AND PRELIMINARY REVIEW
PROCEDURES.  The commission shall adopt procedures for the conduct
of preliminary reviews and preliminary review hearings.  The
(1)  a reasonable time for responding to questions
submitted by the commission and commission staff and subpoenas
issued by the commission; [and]
(2)  the tolling or extension of otherwise applicable
(A)  the commission issues a subpoena and the
commission's meeting schedule makes it impossible both to provide a
reasonable time for response and to comply with the otherwise
(B)  the commission determines that, despite
commission staff's diligence and the reasonable cooperation of the
respondent, a matter is too complex to resolve within the otherwise
applicable deadlines without compromising either the commission
staff's investigation or the rights of the respondent; and
(3)  a deadline on the convening of a panel to conduct a
SECTION 17.  Sections 571.125(a), (b), (d), and (e),
Government Code, are amended to read as follows:
(a)  A panel of two [The] commission members selected in
accordance with Section 571.1251 shall conduct a preliminary review
(1)  following the preliminary review, the [commission
and the] respondent rejects [cannot agree to] the resolution
proposed by commission staff of the complaint or motion
[disposition of the complaint or motion]; or
(2)  the respondent in writing requests a hearing.
(b)  The commission shall provide [written notice] to the
complainant, if any, and the respondent written notice that
(1)  [of] the date, time, and place the panel
[commission] will conduct the preliminary review hearing; and
(2)  a statement that if the commission orders a formal
hearing because the complaint could not be resolved and settled as a
result of the preliminary review hearing, the formal hearing may
result in a higher sanction than the one the panel proposes for the
(d)  During a preliminary review hearing, the panel
(1)  may consider all submitted evidence related to the
complaint or to the subject matter of a motion under Section
(2)  may review any documents or material related to
the complaint or to the motion; and
(3)  shall determine whether there is credible evidence
that provides cause for the panel [commission] to conclude that a
violation within the jurisdiction of the commission has occurred.
(e)  During a preliminary review hearing, the respondent may
appear before the panel [commission] with the assistance of
counsel, if desired by the respondent, and present any relevant
evidence, including a written statement.
SECTION 18.  Subchapter E, Chapter 571, Government Code, is
amended by adding Section 571.1251 to read as follows:
Sec. 571.1251.  SELECTION OF PANEL TO CONDUCT PRELIMINARY
REVIEW HEARING.  The commission shall adopt rules for the selection
of commission members to serve on panels to conduct preliminary
review hearings.  The rules must ensure that:
(1)  a panel is composed of two commission members
selected on a rotating basis; and
(2)  each member of the panel is a member of a different
SECTION 19.  Section 571.126, Government Code, is amended to
Sec. 571.126.  PRELIMINARY REVIEW HEARING: RESOLUTION.  (a)
Except as provided by Subsection (e), as [As] soon as practicable
after the completion of a preliminary review hearing, the panel
[commission] by vote shall issue a decision stating:
(1)  whether there is credible evidence for the panel
[commission] to determine that a violation within the jurisdiction
of the commission has occurred and whether the violation is a
Category One violation [technical or de minimis]; or
(2)  that there is insufficient evidence for the panel
[commission] to determine whether a violation within the
jurisdiction of the commission has occurred.
(b)  If the panel [commission] determines that there is
credible evidence for the panel [commission] to determine that a
violation within the commission's jurisdiction has occurred, the
panel [commission] shall propose to the respondent a resolution to
resolve and settle the complaint or motion to the extent possible.
If the panel [commission] successfully resolves and settles the
complaint or motion, not later than the fifth business day after the
date the respondent accepts the proposed resolution [of the final
resolution of the complaint or motion], the commission shall
provide [send] to the complainant, if any, and the respondent a copy
of the decision stating the panel's [commission's] determination
and written notice of the resolution and the terms of the
resolution.  If the panel [commission] is unsuccessful in resolving
and settling the complaint or motion, the panel [commission] shall:
(1)  order a formal hearing to be held in accordance
with Sections 571.127 [571.129] through 571.132; and
(2)  not later than the fifth business day after the
date the panel determines that there is credible evidence to
determine that a violation has occurred or the date the respondent
rejects the panel's proposed resolution [of the decision], send to
the complainant, if any, and the respondent:
(B)  written notice of the date, time, and place
(C)  a statement of the nature of the alleged
(D)  a description of the evidence of the alleged
(E)  a copy of the complaint or motion;
(F)  a copy of the commission's rules of
(G)  a statement of the rights of the respondent.
(c)  If the panel [commission] determines that there is
credible evidence [for the commission] to determine that a
violation within the jurisdiction of the commission has not
occurred [, the commission shall]:
(1)  the panel shall dismiss the complaint or motion;
(2)  the commission shall not later than the fifth
business day after the date of the dismissal, send to the
complainant, if any, and the respondent a copy of the decision
stating the panel's [commission's] determination and written notice
of the dismissal and the grounds for dismissal.
(d)  If the panel [commission] determines that there is
insufficient credible evidence [for the commission] to determine
that a violation within the jurisdiction of the commission has
occurred, the panel [commission] may dismiss the complaint or
motion or promptly order [conduct] a formal hearing to be held under
Sections 571.127 [571.129] through 571.132.  Not later than the
fifth business day after the date of the panel's [commission's]
determination under this subsection, the commission shall send to
the complainant, if any, and the respondent a copy of the decision
stating the panel's [commission's] determination and written notice
of the grounds for the determination.
(e)  If, because of a tie vote, the panel cannot issue a
decision under Subsection (a), the panel shall order a formal
hearing to be held under Sections 571.127 through 571.132.  Not
later than the fifth business day after the date of the vote, the
commission shall notify the complainant, if any, and the respondent
of the date, time, and place of the hearing.
(f)  Except as provided by other law or commission rule, if
the respondent accepts the proposed resolution under Subsection
(b), the panel shall submit the proposed resolution to the
(g)  A commission member that serves on a preliminary review
hearing panel is not required to be recused from a formal hearing
held under Sections 571.127 through 571.132.
SECTION 20.  Subchapter E, Chapter 571, Government Code, is
amended by adding Section 571.127 to read as follows:
Sec. 571.127.  FORMAL HEARING:  CONDUCT.  (a)  The commission
may conduct a formal hearing under this subchapter or may delegate
to the State Office of Administrative Hearings the responsibility
of conducting a formal hearing under this subchapter.
(b)  The commission shall adopt rules of practice regarding a
formal hearing referred to the State Office of Administrative
(1)  on which party bears the burden of proof;
(2)  on what standard of evidence is required;
(3)  of evidence that may be applicable;
(c)  Proceedings for a formal hearing conducted by the State
Office of Administrative Hearings are governed by Chapter 2001.
Notwithstanding Section 571.1233, the commission shall ensure
rules of practice the commission adopts under Section 2001.004
applicable to the proceedings for a formal hearing do not conflict
with rules the State Office of Administrative Hearings adopts.
SECTION 21.  Section 571.1731, Government Code, is amended
by adding Subsection (d) to read as follows:
(d)  The commission shall waive a civil penalty imposed under
Section 305.033(b) or 572.033(b) of this code or Section
254.042(a), Election Code, if the commission has no record of
providing the late filing notice required by those sections.
SECTION 22.  Section 571.177, Government Code, is amended to
Sec. 571.177.  [FACTORS CONSIDERED FOR] ASSESSMENT AND
SCHEDULE OF SANCTION OR PENALTIES.  (a)  The commission shall
consider the following factors in assessing a sanction or civil
penalty for a violation of a law within the commission's
(1)  the seriousness of the violation, including the
nature, circumstances, consequences, extent, and gravity of the
(2)  the history and extent of previous violations;
(3)  the demonstrated good faith of the violator,
including actions taken to rectify the consequences of the
(4)  the penalty necessary to deter future violations;
(5)  any other matters that justice may require.
(b)  The commission may assess graduated penalties against a
person who repeatedly files late statements or reports in violation
(c)  The commission shall establish and publish on the
commission's Internet website a penalty schedule that outlines the
full range and scope of penalties the commission may assess under a
law within the commission's jurisdiction.  The commission shall
(1)  includes the specific statutes or commission rules
under which the commission may assess a penalty; and
(2)  takes into consideration aggravating and
mitigating factors related to the assessment of a penalty,
including the severity of a violation and graduated penalties for
SECTION 23.  The heading to Section 572.030, Government
Code, is amended to read as follows:
Sec. 572.030.  PREPARATION [AND MAILING] OF FORMS; NOTICE OF
SECTION 24.  Sections 572.030(b), (c), and (d), Government
Code, are amended to read as follows:
(b)  The commission shall mail to each individual required to
file under this subchapter a notice that:
(1)  states that the individual is required to file a
financial statement under this subchapter;
(2)  identifies the filing dates for the financial
statement as provided by Sections 572.026 and 572.027;
(3)  describes the manner in which the individual may
obtain the financial statement forms and instructions from the
(4)  states that on request of the individual, the
commission will provide [mail to] the individual with a copy of the
financial statement forms and instructions; and
(5)  states, if applicable, the fee for mailing the
forms and instructions and the manner in which the individual may
(c)  The commission shall provide the notice required by
Subsection (b) [must be mailed]:
(1)  before the 30th day before the deadline for filing
the financial statement under Section 572.026(a) or (c), except as
otherwise provided by this subsection;
(2)  not later than the 15th day after the applicable
deadline for filing an application for a place on the ballot or a
declaration of write-in candidacy for candidates required to file
under Section 572.027(a), (b), or (c);
(3)  not later than the seventh day after the date of
appointment for individuals required to file under Section
572.026(b), or if the legislature is in session, sooner if
(4)  not later than the fifth day after the date the
certificate of nomination is filed for candidates required to file
under Section 572.027(d) [574.027(d)].
(d)  The commission shall provide [mail] a copy of the
financial statement forms and instructions to an individual on
request of the individual not later than the third business day
after the date the commission receives the individual's request for
SECTION 25.  Sections 572.033(a) and (b), Government Code,
are amended to read as follows:
(a)  The commission shall determine from any available
evidence whether a statement required to be filed under this
subchapter is late.  On making a determination that the statement is
late, the commission shall immediately provide [mail a notice of
the determination] to the individual responsible for filing the
statement and [to] the appropriate attorney for the state notice of
(b)  If a statement is determined to be late, the individual
responsible for filing the statement is liable to the state for a
civil penalty of $500.  If a statement is more than 30 days late, the
commission shall issue a warning of liability [by registered mail]
to the individual responsible for the filing.  If the penalty is not
paid before the 10th day after the date on which the warning is
received, the individual is liable for a civil penalty in an amount
determined by commission rule, but not to exceed $10,000.
SECTION 26.  The following provisions are repealed:
(1)  Sections 254.036(c), (c-1), and (g), Election
(2)  Section 571.032, Government Code; and
(3)  Section 571.1212, Government Code.
SECTION 27.  Section 254.042, Election Code, as amended by
this Act, applies only to a report that is required to be filed
under Chapter 254, Election Code, on or after the effective date of
this Act.  A report under that chapter that is required to be filed
before the effective date of this Act is governed by the law in
effect on the date the report was required to be filed, and the
former law is continued in effect for that purpose.
SECTION 28.  (a)  Except as provided by Subsection (b) of
this section, Section 571.0271, Government Code, as amended by this
Act, applies to a member of the Texas Ethics Commission appointed
before, on, or after the effective date of this Act.
(b)  A member of the Texas Ethics Commission who, before the
effective date of this Act, completed the training program required
by Section 571.0271, Government Code, as that law existed before
the effective date of this Act, is only required to complete
additional training on the subjects added by this Act to the
training program required by Section 571.0271, Government Code.  A
member described by this subsection may not vote, deliberate, or be
counted as a member in attendance at a meeting of the Texas Ethics
Commission held on or after December 1, 2025, until the member
completes the additional training.
SECTION 29.  This Act takes effect September 1, 2025.