1. (a) The institute shall establish a compliance program operating under the direction of the institute's chief compliance officer to monitor compliance with this chapter and rules adopted under this chapter and for use in reporting incidents of noncompliance to the oversight committee.
2. (b) The chief compliance officer or the officer's designee shall attend and observe meetings of the peer review committee and the program integration committee to ensure compliance with this chapter and rules adopted under this chapter.

3. (c) The chief compliance officer shall submit a written report to the oversight committee confirming each grant application recommendation included on the list the program integration committee submits under Section 101A.302(a)(2) complies with the oversight committee's rules regarding grant award procedures. The report must contain all relevant information on:

   1. (1) the peer review process for the grant application;
   2. (2) the score the peer review committee assigns to the application;
   3. (3) adherence to the conflict-of-interest notification and recusal process; and
   4. (4) confirmation that a recommended grant applicant did not make any gift or grant prohibited by Section 101A.302(f).

4. (d) To ensure each grant recipient complies with reporting requirements included in the grant contract and the rules adopted under this chapter, the institute shall implement a system to:

   1. (1) track the dates on which grant recipient reports are due and are received by the institute; and
   2. (2) monitor the status of any required report a grant recipient does not timely submit to the institute.

5. (e) The chief compliance officer shall:

   1. (1) monitor compliance with this section and the status of any required report a grant recipient does not timely submit to the institute; and
   2. (2) notify the institute's general counsel and the oversight committee of a grant recipient who has not complied with the grant contract reporting requirements to allow the institute to suspend or terminate the contract as the institute determines appropriate.

6. (f) The chief compliance officer shall establish procedures for investigating allegations against oversight committee members, institute employees or contractors, grant applicants, or grant recipients for fraud, waste, or abuse of state resources. The procedures must include:

   1. (1) private access to the compliance program office, such as a telephone hotline; and
   2. (2) to the extent possible, preservation of the confidentiality of communications and the anonymity of a person who submits a compliance report related to fraud, waste, or abuse or participates in a compliance investigation.

Added by Acts 2025, 89th Leg., R.S., Ch. 137 (S.B. 5), Sec. 1, eff. December 1, 2025, subject to resolution of an election contest under Chapter 233, Election Code, relating to Article III, Section 68, Texas Constitution.