Relating to the use of the skills development fund by certain entities, the official text

S.B. No. 856

AN ACT

relating to the use of the skills development fund by certain

entities.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 303.001(a), Labor Code, is amended to

read as follows:

(a) The purpose of this chapter is to remove administrative

barriers that impede the response of public community and technical

colleges, community-based organizations, local workforce

development boards, the Texas A&M Engineering Experiment Station,

and the Texas A&M Engineering Extension Service to industry and

workforce training needs and to develop incentives for public

community and technical colleges, community-based organizations,

local workforce development boards, the Texas A&M Engineering

Experiment Station, and the Texas A&M Engineering Extension Service

to provide customized assessment and training in a timely and

efficient manner.

SECTION 2. Section 303.002(b), Labor Code, is amended to

read as follows:

(b) A public community or technical college, the Texas A&M

Engineering Experiment Station, or the Texas A&M Engineering

Extension Service may recover customized assessment and training

costs incurred by the college, station, or service [institution]

if:

(1) there is an actual or projected labor shortage in

the occupation in which training is provided that is not being met

by an existing institution or program in the area; and

(2) the wages at the time of job placement for

individuals who successfully complete customized training at the

public community or technical college, the Texas A&M Engineering

Experiment Station, or the Texas A&M Engineering Extension Service

are equal to the prevailing wage for that occupation in the local

labor market area.

SECTION 3. Sections 303.003(b), (f), (g), and (h), Labor

Code, are amended to read as follows:

(b) The skills development fund may be used by public

community and technical colleges, community-based organizations,

local workforce development boards, the Texas A&M Engineering

Experiment Station, and the Texas A&M Engineering Extension Service

as start-up or emergency funds for the following job-training

purposes:

(1) developing customized training programs for

businesses and trade unions; and

(2) sponsoring small and medium-sized business

networks and consortiums.

(f) The Texas A&M Engineering Experiment Station and the

Texas A&M Engineering Extension Service shall focus the station's

or service's training activities under this chapter on programs

that:

(1) are statewide in nature; or

(2) are not available from a local junior college

district, a local technical college, or a consortium of junior

college districts.

(g) This section does not prohibit the Texas A&M Engineering

Experiment Station or the Texas A&M Engineering Extension Service

from participating in a consortium of junior college districts or

with a technical college that provides training under this chapter.

(h) A community-based organization may apply for money to

participate in a training program only in partnership with a

community and technical college, the Texas A&M Engineering

Experiment Station, or the Texas A&M Engineering Extension Service.

A community-based organization providing services regulated by the

state shall provide evidence of any certification, license, or

registration required by law.

SECTION 4. Section 303.004, Labor Code, is amended to read

as follows:

Sec. 303.004. FUND REVIEW; REPORT BY CERTAIN WORKFORCE

TRAINING PROVIDERS REQUIRED. (a) The Texas Higher Education

Coordinating Board shall review all customized training programs

biennially to verify that state funds are being used appropriately

by public community and technical colleges, the Texas A&M

Engineering Experiment Station, and the Texas A&M Engineering

Extension Service under this chapter.

(b) Not later than October 1 of each even-numbered year, the

Texas A&M Engineering Experiment Station, the Texas A&M Engineering

Extension Service, and each public community or technical college

that provides workforce training under this chapter shall:

(1) conduct a review of the station's, service's, or

college's training programs to:

(A) determine the effectiveness of the programs

in improving the wages of participants who complete the programs;

and

(B) identify strategies for improving the

delivery of workforce training in order to more effectively impact

economic development in this state; and

(2) submit to the commission a detailed written report

summarizing the results of the review for inclusion by the

executive director in the report to the governor and the

legislature required by Section 303.006(c).

(c) If the Texas A&M Engineering Experiment Station, the

Texas A&M Engineering Extension Service, or a public community or

technical college fails to submit a report required by Subsection

(b)(2):

(1) the station, service, or college must refund to

the comptroller any unexpended state funds received by the station,

service, or college under this chapter for the state fiscal

biennium in which the report was due; and

(2) the commission may not award any additional grant

to the station, service, or college under this chapter until the

station, service, or college has complied with that reporting

requirement.

SECTION 5. This Act takes effect September 1, 2025.

______________________________
______________________________

President of the Senate
Speaker of the House

I hereby certify that S.B. No. 856 passed the Senate on

April 1, 2025, by the following vote: Yeas 31, Nays 0.

______________________________

Secretary of the Senate

I hereby certify that S.B. No. 856 passed the House on

May 7, 2025, by the following vote: Yeas 146, Nays 1, two present

not voting.

______________________________

Chief Clerk of the House

Approved:

______________________________

Date

______________________________

Governor