| Authority/Reference(s) | |
|---|---|
| Revision Date | April 15, 2024 |
Policy
Prior to executing a DFPS contract valued at $1 million or more, business entities must disclose interested parties by submitting Form 1295 Certificate of Interested Parties to the Texas Ethics Commission (TEC).
Interested Party is defined in the Texas Government Code as: a person who has a controlling interest in a business entity with whom a governmental entity or state agency contracts or who actively participates in facilitating the contract or negotiating the terms of the contract, including a broker, intermediary, adviser, or attorney for the business entity.
The business entity must electronically complete and submit the form to TEC. DFPS electronically notifies TEC of the receipt of the filed Form 1295 with the certification of filing not later than the 30th day after the date the contract binds all parties to the contract.
Form 1295 is required when:
- The contract is valued at $1 million or more and executed on or after September 1, 2017;
- The governing body of the entity requires an action or vote before the contract or amendment is signed;
- The contract is for services that would require a person to register as a lobbyist under Chapter 305 of the Texas Government Code;
- Form 1295 was not initially filed, and an amendment increased the value of the contract to $1 million or more; or
- When there is a change to the interested parties.
Exemptions from this requirement
- An interagency or interlocal contract with a state agency, government entity, or an institution of higher education;
- Open enrollment contracts or any contract with no specified budget or contract value;
- Contracts with publicly traded business entities, including a wholly owned subsidiary of the business entity; and
- Contracts with electric and gas utilities as defined in the Utilities Code.
Voiding contracts for a business entity’s failure to provide the disclosure of interested parties
Contracts are voidable only if:
- DFPS submits to the business entity written notice of the business entity’s failure to provide the required disclosure; and
- The business entity does not submit the disclosure on or before the 10th business day after receiving the written notice from DFPS.
Procedures
Form 1295 is located on the TEC website where instructions are located and linked in the procedures below. Navigate to the TEC website using Chrome.
- Business entity logs into the TEC website and electronically files and submits Form 1295.
- Business entity notifies the contract manager that the form has been submitted to TEC.
- Contract manager logs into the TEC website and acknowledges Form 1295 not later than the 30th day after the date the contract binds all parties to the contract.
- Contract manager notifies the business entity that the form has been acknowledged.
- Business entity prints and signs the form before sending it to the contract manager (electronically or by mail).
- Upon receipt of the signed form, the contract manager uploads the form into SCOR through the Documents tab using the document type Certificate of Interested Parties (1295) from the document type drop down in SCOR.
Questions regarding the data-entry requirements for TEC can be sent to the Technical Assistance mailbox.