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Learn more about the new prohibitions under HB 210, now Texas Education Code § 11.067.
School districts and their trustees must be aware of the new prohibitions under HB210, now Texas Education Code § 11.067, which severely limits the ability of Board Member-owned businesses to contract with their school districts.
Historically, schools could contract with businesses even if they were owned by Board Members or a Board Member’s close family if all proper disclosures and recusals were made. However, under Texas Education Code § 11.067, effective September 1, 2025, a “Vendor” commits a criminal offense if it receives a contract from the school and any Board Member or Board Member’s family member (2nd degree of consanguinity) has a substantial interest in the business - more than 10% ownership or profits from that business. It also provides for Vendor criminal liability if they gave or promised a trustee a gift valued at $250 or more.
What does this mean for districts and trustees? If a company or business, owned by a trustee or their family member, has any written payment agreement with the district from a detailed contract to a simple purchase order, it should be analyzed for violation. If a trustee or the trustee’s parent, child, sibling, grandparent, or grandchild owns more than 10% of that business, or is entitled to more than 10% profits, the business and its owners are at risk. It is unclear how these criminal penalties might arise, but it is likely that an investigation into the business relationship by local law enforcement is authorized by this statute.
This law does not increase the school’s administrative actions or responsibilities per se. However, if your district has or is considering an “agreement, contract, memorandum of understanding, interlocal agreement, fee schedule, retainer, or similar instrument for goods or services” with a business owned or operated by a Board Member or their family, it is in the best interest of the District to review the agreement to confirm no violation of this new prohibition.
Should you have any questions about prohibited contracts or gifts, Leon Alcala, PLLC is happy to assist. Please contact our attorneys directly or our office at info@leonalcala.com.
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