Tennessee HB 1738: Education, Higher - As introduced, identifies when a member of a governing board has a conflict of interest involving a state institution of higher education governed by the board; prohibits a governing board member from accepting or soliciting anything of value in excess of $250 from an institution governed by the board; prohibits certain persons from serving as a governing board member. - Amends TCA Title 49, Chapter 7; Title 49, Chapter 8 and Title 49, Chapter 9.

Bill Text

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<BillNo> <Sponsor>

HOUSE BILL 1738
By Daniel

AN ACT to amend Tennessee Code Annotated, Title 49,
Chapter 7; Title 49, Chapter 8 and Title 49,
Chapter 9, relative to conflicts of interest.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 49-8-203, is amended by deleting
subsection (g).
SECTION 2. Tennessee Code Annotated, Section 49-9-207, is amended by deleting the
section.
SECTION 3. Tennessee Code Annotated, Title 49, Chapter 7, Part 1, is amended by
adding the following as a new section:
(a) As used in this section, unless the context otherwise requires:
(1) "Governing board" includes the board of trustees of the University of
Tennessee, the board of regents of the state university and community college
system, a local governing board of trustees of a state university, and the
governing board of the Tennessee Foreign Language Institute;
(2) "Immediate family member" means a spouse, parent, grandparent,
sibling, child, grandchild, parent-in-law, sister-in-law, brother-in-law, daughter-in-
law, or son-in-law. "Immediate family member" also includes a family member
who is adopted, of half-blood, or a step member; and
(3) "State institution of higher education" means any public
postsecondary institution operated by a governing board that offers courses of
instruction leading to a certificate or degree.

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(b) Governing board members are prohibited from having a financial or
beneficial interest in any contract or transaction that involves any state institution of
higher education governed by the board. A governing board member is presumed to
have a financial or beneficial interest when the member:
(1) Enters into, or is a party to, a contract or transaction with any state
institution of higher education governed by the board or when a member of the
governing board member's immediate family enters into, or is a party to, a
contract or transaction with any state institution of higher education governed by
the board. Tuition payments, scholarships, and philanthropic gifts to a state
institution of higher education do not constitute a prohibited financial contract or
transaction;
(2) Has direct or indirect ownership in an entity that enters into, or is a
party to, a contract or transaction with any state institution of higher education
governed by the board, other than passive ownership of less than a controlling
interest in publicly traded companies; or
(3) Has a position of actual or apparent authority in, or a fiduciary
relationship with, an entity entering into a contract or transaction with any state
institution of higher education governed by the board, including, but not limited to,
a position as an officer, director, partner, or trustee.
(c) A governing board member shall not accept or solicit from any state
institution of higher education governed by the board anything of value, tangible or
intangible, in excess of two hundred fifty dollars ($250) per calendar year, except for
reasonable reimbursement for travel expenses and other expenses incurred in
connection with the performance of the governing board member's official duties. The
amount of this limitation shall be adjusted annually on December 31 in accordance with
changes in the consumer price index.
(d)

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(1) Appointments to a governing board occurring on or after July 1, 2018,
for a full term or to fill a vacancy, are subject to the requirements of this
subsection (d).
(2) A person shall not serve as a governing board member if an
immediate family member is employed by any state institution of higher
education governed by the board in an administrative, staff, or faculty position.
(3) The following persons shall not serve as a governing board member:
(A) Employees of any state institution of higher education
governed by the board;
(B) Employees of the state or of any agency, department, or other
entity of the state;
(C) Members of any state commission or board established
pursuant to state law;
(D) Any person serving as an elected federal or state official or an
elected county or municipal official in this state; and
(E) Lobbyists, as defined in § 3-6-301.
(3) Except for subdivision (d)(3)(E), this subsection (d) does not apply to
the ex officio members of a governing board or to the faculty and student
members of a governing board.
(e) A governing board member who violates this section shall be removed from
the governing board.
SECTION 4. This act shall take effect July 1, 2018, the public welfare requiring it.