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Recent bills alter liability rules and expand conflict-of-interest penalties for districts
Summary
Kelly Rosti told Boerne ISD trustees that legislation passed this session narrows sovereign immunity for districts in some cases and creates criminal penalties for vendors who contract with districts when trustees or close relatives hold substantial interests or receive gifts over $250, a change that may prompt resignations or later fixes.
Boerne ISD trustees were briefed Aug. 27 on two bills that alter legal exposure and conflict-of-interest rules for school districts.
Kelly Rosti of the Texas Association of School Boards said one bill "pops sovereign immunity for school districts," expanding avenues for claims that previously would have been restricted; TASB worked with authors to amend the measure and limit exposure. "At first, this was a wide open bill and would and could have been a huge cost driver for school districts," she said, describing amendments that reduced payment limits and clarified scope.
Rosti also described a separate provision that makes it a criminal offense for a vendor to bid on or receive a district contract if a trustee or their close relative has a "substantial interest," or if the vendor received or was promised a gift over $250. She said lawmakers and leadership are aware of the provision's potentially broad effects on small, rural districts and local businesses and that a fix could come in a future session, though it was not on the governor's special-session call.
Why it matters: the changes could increase legal liability and create criminal-exposure risk for commonly used local vendors and trustees with local-business ties. Rosti said smaller districts could face resignations or governance disruption if local business owners are disqualified from serving.
Implementation: TASB is monitoring for clarifying amendments; districts were advised to consult legal counsel about potential immediate governance impacts.
No formal action by the board was taken on this topic during the workshop.
