The State Board of Education (SBOE) adopts an amendment to §109.52, concerning the uniform depository bank contract and surety bond forms. The amendment is adopted without changes to the proposed text as published in the December 15, 2017, issue of the Texas Register (42 TexReg 7054) and will not be republished. The adopted amendment updates the depository contract adopted in rule to reflect changes made by Senate Bill (SB) 754, 85th Texas Legislature, Regular Session, 2017.

REASONED JUSTIFICATION. Section 109.52 establishes the requirement that each school district select at least one bank as a depository and enter into a depository contract with the bank, providing the completed contract to the Texas Education Agency (TEA). Section 109.52 also establishes the requirement that a district provide a completed surety bond form to the TEA if the depository bank uses a surety bond to secure district deposits. The section includes the depository contract form and surety bond form with the content prescribed by the SBOE.

SB 754, 85th Texas Legislature, Regular Session, 2017, amended the TEC, §45.205(b), to allow the school district depository contract to be extended a total of three two-year terms. In addition, the bill allows the depository contract to be modified for each two-year extension if both the school district and the district's depository bank mutually agree to the terms.

The adopted amendment to §109.52 implements SB 754 by modifying Figure: 19 TAC §109.52(b) to allow a school district depository contract to be extended to the number of two-year terms allowed by the TEC, §45.205(b).

The amendment was approved by the SBOE for first reading and filing authorization at its November 10, 2017 meeting and for second reading and final adoption at its February 2, 2018 meeting.

In accordance with the TEC, §7.102(f), the SBOE approved the amendment for adoption by a vote of two-thirds of its members to specify an effective date earlier than the beginning of the 2018-2019 school year. The earlier effective date will allow school districts to take advantage of the additional extension period and not be required to go through the depository contract procurement process, which will save taxpayer dollars. In addition, the earlier effective date will expedite the alignment of the rule with SB 754, which became effective September 1, 2017.

SUMMARY OF COMMENTS AND RESPONSES. No public comments were received on the proposal.

STATUTORY AUTHORITY. The amendment is adopted under the Texas Education Code (TEC), §7.102(c)(34), which requires the State Board of Education (SBOE) to prescribe uniform bid blanks for school districts to use in selecting a depository bank as required by the TEC, §45.206; TEC, §45.205(b), as amended by SB 754, 85th Texas Legislature, Regular Session, 2017, which provides the term for a contract between a school district and the district's depository bank; TEC, §45.206, which requires a school district to acquire a bank to be its depository by utilizing either a bid or proposal using the forms prescribed by the SBOE; and TEC, §45.208, which requires that a school district use the depository contract prescribed by the SBOE; and that the depository bank secure the highest daily amount of cash in the bank using a bond or other surety agreements; and that the contract, bid or proposal, and bond be filed with the agency.

CROSS REFERENCE TO STATUTE. The amendment implements the Texas Education Code (TEC), §§7.102(c)(34); 45.205(b), as amended by SB 754, 85th Texas Legislature, Regular Session, 2017; 45.206; and 45.208.