TITLE 13. CULTURAL RESOURCES
PART 2. TEXAS HISTORICAL COMMISSION
CHAPTER 11. ADMINISTRATION DEPARTMENT
SUBCHAPTER
C.
The Texas Historical Commission (THC) proposes new Subchapter C of Chapter 11, including §§11.61 - 11.67, related to Affiliated Nonprofit Organizations and the Friends of the THC, as authorized in Texas Government Code §§ 442.005(q), and 442.043, as enacted in H.B. 4187, 89th Legislature, Regular Session.
Subchapter C, Chapter 11, creates a process for designating affiliated nonprofit organizations who will provide services and other benefits, including financial support, to the Commission or one or more state historic sites defined Texas Government Code § 442.071. These proposed new rules also provide operational guidelines, best practices, and standards for compliance for these affiliated nonprofit organizations.
FISCAL NOTE. Joseph Bell, Executive Director, has determined that for each of the first five years the proposed new rules are in effect, there will not be a fiscal impact on state or local government as a result of enforcing or administering the new rule as proposed. The related policy and procedure are in place for this rule and there is no anticipated additional cost as a result of the rulemaking.
PUBLIC BENEFIT/COST NOTE. Mr. Bell has also determined that for the first five-year period the rule is in effect, the anticipated public benefit will be the ability of THC to designate affiliated nonprofit organizations to provide support and benefits, including financial support, to help the THC achieve its goals and objectives.
ECONOMIC COSTS TO PERSONS AND IMPACT ON LOCAL EMPLOYMENT. There are no anticipated economic costs to persons who are required to comply with these new rules, as proposed. There is no effect on local economy for the first five years that the proposed new rules are in effect; therefore, no local employment impact statement is required under Texas Government Code § 2001.022 and § 2001.024(a)(6).
COSTS TO REGULATED PERSONS. The proposed new rules do not impose a cost on regulated persons, including another state agency, a special district, or a local government and, therefore, are not subject to Texas Government Code § 2001.0045.
ECONOMIC IMPACT STATEMENT AND REGULATORY FLEXIBILITY ANALYSIS FOR SMALL BUSINESSES, MICROBUSINESSES, AND RURAL COMMUNITIES. The proposed new rules provide an opportunity for the THC to designate affiliated nonprofit organizations to provide services and benefits, including financial support, to help THC achieve its goals and objectives. There is no anticipated economic impact of these new rules. Mr. Bell has also determined that there will be no impact on rural communities, small businesses, or micro-businesses as a result of implementing these new rules; therefore, no regulatory flexibility analysis, as specified in Texas Government Code § 2006.002, is required. The proposed new rules do not affect small businesses, micro-businesses, or rural communities because the new rules only apply to affiliated nonprofit organizations designated by THC to support the commission and one or more state historic sites.
GOVERNMENT GROWTH IMPACT STATEMENT. During the first five years that the new rules would be in effect, the proposed new sections: will not create or eliminate a government program; will not result in the addition or reduction of employees; will not require an increase or decrease in future legislative appropriations; will not lead to an increase or decrease in fees paid to a state agency; will not create a new regulation; will not repeal an existing regulation; and will not result in an increase or decrease in the number of individuals subject to the rule. During the first five years that the new rules would be in effect, the proposed new rules will not positively or adversely affect the Texas economy.
REQUEST FOR PUBLIC COMMENT. Comments on the proposed new rules may be submitted to Joseph Bell, Executive Director, Texas Historical Commission, P.O. Box 12276, Austin, Texas 78711. Comments will be accepted for 30 days after publication in the Texas Register.
STATUTORY AUTHORITY AND STATEMENT ON AUTHORITY. These new rules are proposed under the authority of Texas Government Code § 442.005(q), which provides the Commission with the authority to promulgate rules for the effective administration of Chapter 442, Texas Government Code, and Texas Government Code § 442.043, as enacted by the 89th Legislature, R.S., in HB 4187, which provides the Commission with authority to adopt rules establishing guidelines and best practices, as well as accounting standards and safeguards for affiliated nonprofit organizations.
CROSS REFERENCE TO STATUTE. The new rules will implement Texas Government Code § 442.043 enacted by the 89th Legislature, R.S., in H.B.4187.
§11.61.
The following words and terms, when used in this subchapter, shall have the following meanings, unless the context clearly indicates otherwise.
(1) Affiliated Nonprofit Organization (ANO)--A nonprofit organization designated in Subchapter A-1, Chapter 442, Texas Government Code, for the purpose of supporting the commission or a specific state historic site or sites by providing services and benefits, including financial support.
(2) Commission--Texas Historical Commission.
(3) Director--Executive director of the commission.
(4) Donor--A person who makes a contribution to the commission for which there is no consideration or expectation of consideration in return.
(5) Friends of the Texas Historical Commission (Friends)--the ANO designated in Subchapter A-1, Chapter 442, Texas Government Code, to provide services and benefits, including financial support, to the commission for the purpose of helping the commission achieve its goals and objectives.
(6) Gift--A donation of money or property other than volunteer time for which there is no consideration or expectation of consideration in return.
(7) Improvement--A permanent addition to real property which is in the nature of a fixture.
(8) In-kind donation--A non-cash donation, such as services, personal property or real property.
(9) Interpretive Master Plan--The collection of interpretive themes and plans approved by the commission for each state historic site under Texas Government Code § 442.114.
(10) IRS 990--United States Internal Revenue Service Form 990, Return of Organization Exempt from Tax.
(11) Local sponsorship--A campaign to raise funds in support of a commission program that is intended to benefit a single state historic site.
(12) Nonprofit entity--An incorporated entity that is exempt from federal taxation under §501(c) of the Internal Revenue Code of 1986 (Title 26, United States Code).
(13) Program--An activity, event or project undertaken by an ANO for the benefit of the commission.
(14) Sponsor--A person, corporation, company, or other organization that provides funds in support of a specific commission project, program or event.
(15) Sponsorship--The payment of money, transfer of property, or performance of services by a person, corporation, company, or other organization with respect to which there is no arrangement or expectation of any substantial return benefit other than recognition or a non-substantial benefit.
(16) Statewide sponsorship--A sponsorship or campaign to raise funds in support of a commission program that is intended to benefit more than a single commission facility or is intended to reach the majority of the population of the state.
§11.62.
All ANOs must meet the requirements and criteria of this section.
(1) All ANOs must carry out the fiscal, business, legal, and tax responsibilities of a nonprofit entity as required by state and federal law.
(2) ANOs must have obtained from the Internal Revenue Service a valid determination letter that it is an organization described in §501(c) of the Internal Revenue Code of 1986 (Title 26, United States Code), as amended.
(3) An ANO's work with the commission must be consistent with the commission's mission and goals.
(4) Upon dissolution, an ANO may be required to dispose of funds raised for the benefit of the commission in a way that will benefit the commission, in accordance with applicable law.
(5) An ANO must be incorporated in accordance with the Texas Nonprofit Corporation Act (Chapter 22, Texas Business Organizations Code).
(6) Each ANO must enter into an agreement with the commission detailing the responsibilities and duties of the ANO and the commission. Each ANO must maintain such an agreement with the commission for as long as the entity is an ANO. The agreement may also address the obligations of an ANO upon termination of the relationship between the ANO and the commission, including termination resulting from the dissolution of the ANO.
(7) An ANO must promptly notify the commission of any change in its legal or tax-exempt status.
§11.63.
(a) ANOs must comply with the general best practices prescribed in this subsection.
(1) ANOs shall not hold or obligate commission funds unless the ANO has entered into written agreement with the commission regarding the use of such funds.
(2) ANOs shall comply with all applicable rules, regulations, and laws, including all applicable laws regarding discrimination based on race, color, national origin, sex, age, and disability.
(3) ANOs shall not use or authorize the use of commission intellectual property, including trademarks, logos, name, or seal, without the express written agreement of the commission.
(4) ANOs may use equipment, facilities, or services of employees of the commission only in accordance with a written agreement that provides for the payment of adequate compensation and/or identifies the benefit to the commission for such use. Notwithstanding this subsection, an ANO may use commission facilities to the same extent and for the same fee as members of the public.
(5) ANOs shall conduct business in a way that will ensure public access and transparency. As used in this subsection, "transparency" shall mean that an ANO's business practices and internal processes are conducted in a way that is open, clear, measurable, and verifiable.
(6) ANOs shall file with the commission and make available to the public an annual report that includes a list of the primary activities undertaken during the previous year, a summary of significant achievements and challenges over the previous year, and other information requested by the commission.
(7) Regardless of whether an ANO is required to file an IRS 990 with the Internal Revenue Service, each ANO must complete and file an IRS 990 with the commission each year, regardless of income.
(8) ANOs shall file with the commission their articles of incorporation, by-laws, most recent financial statements, and any updates to these documents upon request of the commission.
(9) An ANO shall not engage in activities that would require it or a person acting on its behalf to register as a lobbyist under Chapter 305, Texas Government Code, or other Texas law. However, this subsection is not intended to restrict an ANO from providing information to the legislature or to other elected or appointed officials.
(10) ANOs shall not donate funds to a political campaign or endorse a political candidate.
(11) ANOs shall notify the commission of all meetings and allow a commission representative to attend all meetings, including, but not limited to, meetings of the ANO's general membership, managing board, and committees. Meeting notices must be provided to the commission sufficiently in advance of the meeting so that the commission representative has ample opportunity to attend. Such notice may be provided by letter, email, or telephone.
(12) ANOs must have an annual audit by an independent accounting firm and shall make the results of that audit available to the commission.
(13) ANOs must maintain an adequate directors and officers liability insurance policy.
§11.64.
(a) All officers and directors of each ANO must receive a copy of or a link to the commission's current Strategic Plan and the interpretive themes and plan(s) approved by the commission under Texas Government Code § 442.114 for the state historic site or sites supported by the ANO. The officers and directors of the Friends shall receive a copy of the Interpretive Master Plan approved by the commission.
(b) In addition to subsection (a) of this section, ANOs must comply with these best practices regarding officers and directors:
(1) ANOs must adopt and maintain a conflict of interest policy, which includes safeguards to prevent board members or their families from benefiting financially from any business decision of the ANO.
(2) ANOs shall ensure that any compensation paid to executives or managers is reasonable.
(3) ANOs shall not elect, designate, or otherwise select a commission employee as an officer or director, other than as a non-voting uncompensated representative of the commission.
(4) ANOs shall hold regular meetings of its Board of Directors.
(5) ANOs shall ensure that each board member and/or director is fully informed of the ANO's activities and shall provide the following information to new board members:
(A) articles of incorporation and by-laws;
(B) most recent financial statements;
(C) commission rules on ANOs and sponsorship; and
(D) current agreements with the commission.
§11.65.
(a) All ANOs must comply with the requirements of this subsection regarding fundraising.
(1) ANOs may conduct fundraising to provide additional funds for commission operations, to enhance commission programs, to provide long-term endowments for commission programs, to facilitate special projects, or otherwise support the commission in carrying out its mission, but only as agreed in writing by the commission in advance.
(2) ANOs may undertake programs for the benefit of the commission, so long as such programs are related to and supportive of the commission's mission and are agreed to in writing by the commission in advance. A single agreement may cover multiple programs.
(3) ANOs shall decline donations that require actions, including recognition, by the commission for which the commission has not given prior written consent.
(4) Funds accepted by an ANO for the benefit of the commission are to be managed as a reasonably prudent person would manage funds if acting on his or her own behalf and such funds are to be accounted for according to Generally Accepted Accounting Principles (GAAP).
(5) All projects undertaken for the commission by an ANO must be related to and supportive of the facility, property, or program with which an ANO is associated or must further the ANO's mission related to the facility, property or program.
(6) All donations to an ANO must benefit the commission or the facility, property, or program with which the ANO is associated or must further the ANO's mission related to the facility, property, or program.
(7) For purposes of this subsection, a donation for the purpose of defraying the ANO's operating costs furthers the ANO's mission related to the facility, property, or program.
(8) ANOs shall adopt procedures that address acceptance and granting of funds raised to benefit projects and/or programs of the commission.
(b) Nothing in this subchapter shall limit the ability of an ANO to make an unrestricted cash donation to the commission. Such a donation may also be made for a specific purpose or program in furtherance of the commission's mission.
(c) ANOs may work together towards a common fundraising goal for the benefit of the commission, consistent with the requirements of this subchapter.
§11.66.
(a) ANOs may solicit and accept sponsorships for commission programs, so long as the ANO complies with the provisions of this subsection and other written guidance that may be provided by the department.
(1) All sponsorships of commission programs and the level of sponsorship recognition provided by the commission must have prior written approval of the commission.
(2) ANOs shall not solicit or accept a sponsorship in support of a commission program from:
(A) a person or entity that has been determined by the commission to conflict with either the commission's mission or legislative mandates; or
(B) a person or entity that is in litigation with the commission at the time of consideration.
(3) Sponsor recognition shall be limited as prescribed in this paragraph.
(A) Sponsor recognition shall be solely in the context of the commission program that the sponsor has supported with a financial or in-kind contribution.
(B) Sponsor recognition shall be permitted only when the financial or in-kind contribution is greater than the costs associated with providing sponsor recognition.
(C) Sponsor recognition shall not include signage of any kind on state-owned motor vehicles or trailers that were purchased or are maintained with department funds.
(D) Sponsor recognition shall not overshadow the project, the purposes of the project, or the mission of the commission or result in the role of the commission being less prominent than that of the sponsor.
(4) In determining the level of sponsorship recognition to provide, the commission will consider:
(A) the level of contribution as a percentage of the total funding required to execute or produce the program, event, or material;
(B) the level of contribution as a percentage of total sponsorship dollars received;
(C) the scope of exposure (e.g. statewide, regional, local, or a single location); and
(D) the duration of exposure (e.g. one day, one month, or one year).
(5) Sponsorship recognition may not promote the sponsor's products, services, or facilities. This subsection does not prohibit the broadcast or display of the sponsor's logo or name and a reference to the sponsor's location.
(6) No officer or employee of the department shall act as the agent for any ANO or donor in negotiating the terms or conditions of any agreement relating to the provision of funds, services, or property to the commission by the ANO or donor.
(b) Nothing in this subchapter shall limit the ability of an ANO to make an unrestricted cash donation to the commission when no sponsorship recognition is provided. Such a donation may also be made for a specific purpose or program in furtherance of the commission's mission.
§11.67.
(a) The commission will not obligate ANO funds or property except by written agreement signed by the ANO.
(b) The Friends may reimburse commission employees for legitimate, documented expenses. Additionally, the Friends may award scholarships to commission employees from private, donor-directed sources, so long as there is a benefit to the commission.
(c) The commission may develop model policies and procedures for adoption by ANOs. Where an ANO is required by these rules to adopt a policy or procedure, adoption of the model policy or procedure shall be deemed to comply with that requirement.
(d) All reimbursements made by the Friends under subsection (b) of this section and all donations to the commission of $500 or more must be approved by the commission, voting in public session.
The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.
Filed with the Office of the Secretary of State on September 18, 2025.
TRD-202503307
Joseph Bell
Executive Director
Texas Historical Commission
Earliest possible date of adoption: November 2, 2025
For further information, please call: (512) 463-6100