By: Bettencourt  S.B. No. 1886          (In the Senate - Filed March 10, 2017; March 23, 2017, read   first time and referred to Committee on Education; May 1, 2017,   reported adversely, with favorable Committee Substitute by the   following vote:  Yeas 11, Nays 0; May 1, 2017, sent to printer.)Click here to see the committee vote    COMMITTEE SUBSTITUTE FOR S.B. No. 1886 By:  Bettencourt     A BILL TO BE ENTITLED   AN ACT     relating to the oversight of public education, including the   creation of the office of inspector general at the Texas Education   Agency.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Chapter 7, Education Code, is amended by adding   Subchapter E to read as follows:   SUBCHAPTER E. OFFICE OF INSPECTOR GENERAL          Sec. 7.151.  DEFINITIONS. In this subchapter:                (1)  "Fraud" means an intentional deception or   misrepresentation made by a person with the knowledge that the   deception could result in some unauthorized benefit to that person   or some other person. The term includes any act that constitutes   fraud under applicable federal or state law.                (2)  "Office" means the office of inspector general   established under this subchapter.          Sec. 7.152.  OFFICE OF INSPECTOR GENERAL. (a)  The office   of inspector general is established as a division within the   agency.          (b)  The commissioner shall appoint an inspector general to   serve as director of the office. The inspector general serves until   removed by the commissioner.          Sec. 7.153.  GENERAL RESPONSIBILITIES. (a)  The office is   responsible for the investigation, prevention, and detection of   criminal misconduct and wrongdoing and of fraud, waste, and abuse   in the administration of public education by:                (1)  school districts, including school districts   described by Section 11.301(a);                (2)  open-enrollment charter schools;                (3)  regional education service centers;                (4)  county systems described by Section 11.301(a); and                (5)  other local education agencies in this state.          (b)  The office shall investigate allegations of fraud,   waste, and abuse and violations of this code or other law.          (c)  The office may:                (1)  conduct criminal, civil, and administrative   investigations and initiate reviews of:                      (A)  a school district, including a school   district described by Section 11.301(a);                      (B)  an open-enrollment charter school;                      (C)  a regional education service center;                      (D)  a county system described by Section   11.301(a); or                      (E)  any other local education agency as   considered appropriate by the inspector general;                (2)  receive and investigate complaints from any source   on its own initiative; and                (3)  conduct special accreditation investigations   authorized by the commissioner under Section 39.057(a).          (d)  The office shall perform all other duties and exercise   all other powers granted to the office by this subchapter or another   law.          Sec. 7.154.  GENERAL POWERS. The office has all the powers   necessary or appropriate to carry out its responsibilities and   functions under this subchapter and other law.          Sec. 7.155.  SUBPOENAS. (a)  The inspector general may   issue a subpoena to compel the attendance of a relevant witness at a   hearing or deposition under this subchapter or to compel the   production, for inspection or copying, of books, papers, records,   documents, or other relevant materials, including electronic data,   in connection with an investigation, review, hearing, or deposition   conducted under this subchapter.          (b)  A subpoena may be served personally or by certified   mail. If a person fails to comply with a subpoena, the inspector   general, acting through the attorney general, may file suit to   enforce the subpoena in a district court in this state.          (c)  On finding that good cause exists for issuing the   subpoena, the court shall order the person to comply with the   subpoena. The court may hold in contempt a person who fails to obey   the court order.          Sec. 7.156.  COOPERATION WITH LAW ENFORCEMENT OFFICIALS AND   OTHER ENTITIES. (a)  The office may provide information and   evidence relating to criminal acts to the State Auditor's Office   and appropriate law enforcement officials.          (b)  The office may refer matters for further civil,   criminal, and administrative action to appropriate administrative   and prosecutorial agencies, including the attorney general.          SECTION 2.  Subchapter G, Chapter 11, Education Code, is   amended by adding Section 11.305 to read as follows:          Sec. 11.305.  OVERSIGHT OF CERTAIN ENTITIES.  (a)  Each   school district or county system described by Section 11.301(a)   shall provide a report to the agency not later than February 27 of   each year. The annual report must include, at a minimum:                (1)  a summary of the district's or system's operations   for the preceding fiscal year; and                (2)  the district's or system's financial statements,   audited by a certified public accountant, for the preceding fiscal   year.          (b)  The commissioner may direct the agency to investigate a   school district or county system described by Section 11.301(a) for   potential fraud, waste, or abuse.          (c)  If after an investigation described by Subsection (b)   the commissioner determines that a school district or county system   has engaged in fraud, waste, or abuse and the school district or   county system does not timely correct the fraud, waste, or abuse to   the satisfaction of the commissioner, the commissioner may replace   the governing board of the school district or county system with a   board of managers in accordance with Chapter 39 and rules adopted   under that chapter.          (d)  If a school district or county system described by   Section 11.301(a) discovers an instance of fraud, waste, or abuse,   the school district or county system shall report the fraud, waste,   or abuse to the agency not later than the 20th day after the date the   fraud, waste, or abuse is discovered.          (e)  If a school district or county system described by   Section 11.301(a) fails to file an annual report under Subsection   (a) or fails to report fraud, waste, or abuse under Subsection (d),   the commissioner may replace the governing board of the school   district or county system with a board of managers in accordance   with Chapter 39 and rules adopted under that chapter.          (f)  The commissioner may adopt rules as necessary to   implement this section.          SECTION 3.  Section 39.057(a), Education Code, is amended to   read as follows:          (a)  The commissioner may authorize special accreditation   investigations to be conducted:                (1)  when excessive numbers of absences of students   eligible to be tested on state assessment instruments are   determined;                (2)  when excessive numbers of allowable exemptions   from the required state assessment instruments are determined;                (3)  in response to complaints submitted to the agency   with respect to alleged violations of civil rights or other   requirements imposed on the state by federal law or court order;                (4)  in response to established compliance reviews of   the district's financial accounting practices and state and federal   program requirements;                (5)  when extraordinary numbers of student placements   in disciplinary alternative education programs, other than   placements under Sections 37.006 and 37.007, are determined;                (6)  in response to an allegation involving a conflict   between members of the board of trustees or between the board and   the district administration if it appears that the conflict   involves a violation of a role or duty of the board members or the   administration clearly defined by this code;                (7)  when excessive numbers of students in special   education programs under Subchapter A, Chapter 29, are assessed   through assessment instruments developed or adopted under Section   39.023(b);                (8)  in response to an allegation regarding or an   analysis using a statistical method result indicating a possible   violation of an assessment instrument security procedure   established under Section 39.0301, including for the purpose of   investigating or auditing a school district under that section;                (9)  when a significant pattern of decreased academic   performance has developed as a result of the promotion in the   preceding two school years of students who did not perform   satisfactorily as determined by the commissioner under Section   39.0241(a) on assessment instruments administered under Section   39.023(a), (c), or (l);                (10)  when excessive numbers of students eligible to   enroll fail to complete an Algebra II course or any other advanced   course as determined by the commissioner;                (11)  when resource allocation practices as evaluated   under Section 39.0821 indicate a potential for significant   improvement in resource allocation;                (12)  when a disproportionate number of students of a   particular demographic group is graduating with a particular   endorsement under Section 28.025(c-1);                (13)  when an excessive number of students is   graduating with a particular endorsement under Section   28.025(c-1);                (14)  in response to a complaint submitted to the   agency with respect to alleged inaccurate data that is reported   through the Public Education Information Management System (PEIMS)   or through other reports required by state or federal law or rule or   court order and that is used by the agency to make a determination   relating to public school accountability, including accreditation,   under this chapter; [or]                (15)  by the office of inspector general for the   purpose of investigating allegations of fraud, waste, and abuse in   the administration of public education; or                (16)  as the commissioner otherwise determines   necessary.          SECTION 4.  This Act takes effect September 1, 2017.     * * * * *