TITLE: Relating to use of money from the Texas Enterprise Fund for certain projects involving the commercialization of property derived from research at or through institutions of higher education.

SUMMARY: Relating to use of money from the Texas Enterprise Fund for certain projects involving the commercialization of property derived from research at or through institutions of higher education.

FULL TEXT:
AN ACT relating to use of money from the Texas Enterprise Fund for certain projects involving the commercialization of property derived from research at or through institutions of higher education. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Sections 481.078(c) and (f), Government Code, are amended to read as follows: (c) Except as provided by Subsections (d) and (d-1), the fund may be used only for:(1) economic development, infrastructure development, community development, job training programs, and business incentives;and (2) projects for commercialization of property derived from research developed at or through public or private institutions of higher education as provided by Section 481.081.(f) Before awarding a grant from the fund [under this section],the governor shall enter into a written agreement with the entity to be awarded the grant money.If the entity is awarded a grant for a purpose described by Subsection (c)(1), the agreement must specify [specifying] that: (1) if the governor finds that the grant recipient has not met each of the performance targets specified in the agreement as of a date certain provided in the agreement: (A) the recipient shall repay the grant and any related interest to the state at the agreed rate and on the agreed terms; (B) the governor will not distribute to the recipient any grant money that remains to be awarded under the agreement; and (C) the governor may assess specified penalties for noncompliance against the recipient; (2) if all or any portion of the amount of the grant is used to build a capital improvement, the state may: (A) retain a lien or other interest in the capital improvement in proportion to the percentage of the grant amount used to pay for the capital improvement; and (B) require the recipient of the grant, if the capital improvement is sold, to: (i) repay to the state the grant money used to pay for the capital improvement, with interest at the rate and according to the other terms provided by the agreement; and (ii) share with the state a proportionate amount of any profit realized from the sale; and (3) if, as of a date certain provided in the agreement, the grant recipient has not used grant money awarded under this section for the purposes for which the grant was intended, the recipient shall repay that amount and any related interest to the state at the agreed rate and on the agreed terms. SECTION 2. Section 481.079(a-1), Government Code, is amended to read as follows: (a-1) For grants awarded for a purpose specified by Section 481.078(d-1) or 481.081,the report must include only the amount and purpose of each grant. SECTION 3. Subchapter E, Chapter 481, Government Code, is amended by adding Section 481.081 to read as follows: Sec. 481.081. TEXAS ENTERPRISE FUND: GRANT FOR UNIVERSITY RESEARCH DEVELOPMENT WITH PRIVATE SPONSORSHIP. (a) In this section: (1) "Fund" means the Texas Enterprise Fund under Section 481.078. (2) "Public or private institution of higher education" means an institution of higher education or a private or independent institution of higher education as those terms are defined by Section 61.003, Education Code. (b) The governor may provide grants to public or private institutions of higher education from the fund to supplement other funding for projects involving the commercialization of intellectual property or other property derived from research developed at or through a public or private institution of higher education. To be eligible for a grant under this section, a project must be supported by funding provided by one or more private entities participating in the project, in addition to any funding provided by the public or private institution of higher education. (c) The amount of a grant awarded under this section may not exceed 50 percent of the total amount of investment in the project provided by the applicable public or private institution of higher education and the participating private entity or entities. SECTION 4. This Act takes effect September 1, 2017.