SB499

Regular Session

Relating to the selection by the board of directors of the West Coke County Hospital District of a depository bank for the district.

LowStandard timeline

Low Cost

Effective:2025-09-01

Enforcing Agencies

West Coke County Hospital District Board of Directors

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

Effective Date: September 1, 2025
Compliance Deadline: Immediate upon effective date. Financial institutions wishing to bid must be prepared for the District's next Request for Applications (RFA) or Request for Proposals (RFP) cycle following this date.
Agency Rulemaking: Local Only. The State will not issue rules; however, the WCCHD Board of Directors must update internal procurement policies to reflect broader eligibility criteria prior to issuing new solicitations.

Immediate Action Plan

Identify Contract Expiration: Submit a Public Information Act (PIA) request to WCCHD immediately to determine the expiration date of the current depository contract.
Update Collateral Pools: Ensure your institution has sufficient eligible securities to collateralize the District’s funds under the Public Funds Collateral Act before bidding.
Prepare Digital Pitch: Develop a specific presentation for the WCCHD Board demonstrating how remote deposit capture and wire services replace the need for daily branch visits.
Monitor Board Agendas: Assign staff to monitor WCCHD Board meeting notices starting June 2025 for discussions regarding depository selection criteria.

Operational Changes Required

Contracts

Depository Agreements: Existing contracts with incumbent local banks are subject to non-renewal or termination upon expiration.
Service Level Agreements (SLAs): New contracts with non-local institutions must incorporate specific SLAs regarding digital banking uptime, remote deposit capture limits, and courier services for cash handling, as physical branch reliance is removed.

Hiring/Training

Business Development: Regional banks must update government banking prospect lists to include WCCHD.
Treasury Sales: Commercial officers must be trained to pitch digital-first treasury solutions to the District, emphasizing how technology mitigates the lack of a local physical branch.

Reporting & Record-Keeping

Bid Documentation: Non-local banks must document "best value" propositions in their proposals—specifically interest rates and fee structures—to overcome potential local political preference.
Collateralization: Selected depositories must maintain and report collateralization of public funds in excess of FDIC limits, strictly adhering to Texas Government Code Chapter 2257 (Public Funds Collateral Act).

Fees & Costs

No Statutory Fees: The bill imposes no new state fees.
Operational Costs: Non-local banks may incur costs related to courier services or implementing specialized remote treasury hardware for the District.

Strategic Ambiguities & Considerations

The "Local Preference" Policy Gap:

While SB499 *permits* the Board to select a non-local bank, it does not *prohibit* the Board from prioritizing local economic ties. The statute does not define how the Board must weigh "convenience" vs. "cost."

Risk: The Board may retain an unwritten preference for local institutions.
Mitigation: Non-local bidders must demonstrate significant cost savings or superior yield on deposits to compel the Board to switch vendors.

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Legislative Timeline

This bill's path through the Texas Legislature

TopicsWest Coke County Hospital District Special Districts & Authorities Special Districts & Authorities--hospital

Official Analysis

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BILL ANALYSIS

Senate Research Center	S.B. 499
89R95 MPF-D	By: Sparks
	Local Government
	3/7/2025
	As Filed

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

Residents in Coke County have expressed concerns with the enabling legislation for the West Coke County Hospital District. Currently, the enabling legislation does not give the hospital district any authority to select a depository outside of the district. Robert Lee, where the district is located, is very rural and only has one banking option. This limits the district's ability to more efficiently and effectively serve district residents. S.B. 499 amends the Special District Local Laws Code to remove the requirement that the West Coke County Hospital District select a bank in the district. This legislation is a refile of H.B. 5160 from the 88th Legislative Session.

As proposed, S.B. 499 amends current law relating to the selection by the board of directors of the West Coke County Hospital District of a depository bank for the district.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 1112.155(a), Special District Local Laws Code, to require the board of directors of the West Coke County Hospital District to select one or more banks, rather than one or more banks in the district, to serve as a depository for district money.�

SECTION 2. Effective date: upon passage or September 1, 2025.

Senate Authors

Sen. Kevin SparksRepublican · Primary Author

Coauthors (1)

Royce West (D)

House Sponsor

Rep. Drew DarbyRepublican · Primary Sponsor

Bill Text(with markup)

S.B. No. 499

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

	AN ACT
	relating to the selection by the board of directors of the West Coke
	County Hospital District of a depository bank for the district.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1. Section 1112.155(a), Special District Local Laws
	Code, is amended to read as follows:
	(a) The board shall select one or more banks [~~in the~~
	~~district~~] to serve as a depository for district money.
	SECTION 2. This Act takes effect immediately if it receives
	a vote of two-thirds of all the members elected to each house, as
	provided by Section 39, Article III, Texas Constitution. If this
	Act does not receive the vote necessary for immediate effect, this
	Act takes effect September 1, 2025.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION


March 8, 2025

TO:	Honorable Paul Bettencourt, Chair, Senate Committee on Local Government

FROM:	Jerry McGinty, Director, Legislative Budget Board

IN RE:	SB499 by Sparks (Relating to the selection by the board of directors of the West Coke County Hospital District of a depository bank for the district.), As Introduced

No fiscal implication to the State is anticipated.

Local Government Impact

No significant fiscal implication to units of local government is anticipated.

Source Agencies:

529 Health and Human Services Commission

LBB Staff:

JMc, SZ, BC, CWi

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Frequently Asked Questions

Common questions about SB499

What does Texas SB499 do?

SB499 eliminates the statutory requirement that the West Coke County Hospital District (WCCHD) select a depository bank physically located within the district's boundaries. This legislation immediately expands the eligible vendor pool, allowing regional financial institutions across West Texas to bid on and secure the District’s banking and treasury management contracts. Implementation Timeline Effective Date: September 1, 2025 Compliance Deadline: Immediate upon effective date.

Who authored SB499?

SB499 was authored by Texas Senator Kevin Sparks during the Regular Session.

When was SB499 signed into law?

SB499 was signed into law by Governor Greg Abbott on May 24, 2025.

Which agencies enforce SB499?

SB499 is enforced by West Coke County Hospital District Board of Directors.

How urgent is compliance with SB499?

The compliance urgency for SB499 is rated as "low". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

What is the cost impact of SB499?

The cost impact of SB499 is estimated as "low". This may vary based on industry and implementation requirements.

What topics does SB499 address?

SB499 addresses topics including west coke county hospital district, special districts & authorities and special districts & authorities--hospital.

Legislative data provided by LegiScanLast updated: November 25, 2025

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