1     
STATE TECHNOLOGY COMMERCIALIZATION AMENDMENTS

2     
2019 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Mike Winder

5     
Senate Sponsor: Daniel McCay

6     

7     LONG TITLE
8     General Description:
9          This bill modifies provisions of the Utah Science Technology and Research Governing
10     Authority Act and the Governor's Office of Economic Development (GOED).
11     Highlighted Provisions:
12          This bill:
13          ▸     changes the name of the Utah Science Technology and Research (USTAR)
14     Initiative to Innovate Utah;
15          ▸     modifies the membership of the governing authority;
16          ▸     modifies the grant-making authority of Innovate Utah;
17          ▸     modifies reporting requirement of Innovate Utah;
18          ▸     modifies provisions related to GOED's grant-making authority under the
19     Technology Commercialization and Innovation Program (TCIP);
20          ▸     modifies GOED's responsibilities regarding business resource centers; and
21          ▸     makes technical changes.
22     Money Appropriated in this Bill:
23          None
24     Other Special Clauses:
25          None
26     Utah Code Sections Affected:
27     AMENDS:

28          49-11-406, as last amended by Laws of Utah 2013, Chapter 310
29          49-13-203, as last amended by Laws of Utah 2018, Chapter 10 and last amended by
30     Coordination Clause, Laws of Utah 2018, Chapter 315
31          49-22-205, as last amended by Laws of Utah 2018, Chapter 10
32          53B-17-1101, as enacted by Laws of Utah 2018, Chapter 453
33          53B-18-1601, as enacted by Laws of Utah 2018, Chapter 453
34          53F-2-203, as last amended by Laws of Utah 2018, Chapters 448, 456 and renumbered
35     and amended by Laws of Utah 2018, Chapter 2
36          53F-2-414, as enacted by Laws of Utah 2018, Chapter 464
37          53F-2-505, as renumbered and amended by Laws of Utah 2018, Chapter 2
38          63A-3-110, as last amended by Laws of Utah 2018, Chapter 25
39          63A-5-204, as last amended by Laws of Utah 2018, Chapter 401
40          63J-1-602.2, as repealed and reenacted by Laws of Utah 2018, Chapter 469
41          63M-2-101, as last amended by Laws of Utah 2015, Chapter 283
42          63M-2-102, as last amended by Laws of Utah 2016, Chapter 240
43          63M-2-301, as last amended by Laws of Utah 2016, Chapter 240
44          63M-2-302, as repealed and reenacted by Laws of Utah 2016, Chapter 240
45          63M-2-302.5, as last amended by Laws of Utah 2016, Chapter 240
46          63M-2-501, as enacted by Laws of Utah 2016, Chapter 240
47          63M-2-502, as last amended by Laws of Utah 2018, Chapter 453
48          63M-2-503, as enacted by Laws of Utah 2016, Chapter 240
49          63M-2-504, as enacted by Laws of Utah 2016, Chapter 240
50          63M-2-602, as last amended by Laws of Utah 2018, Chapter 453
51          63M-2-701, as enacted by Laws of Utah 2016, Chapter 240
52          63M-2-703, as enacted by Laws of Utah 2016, Chapter 240
53          63M-2-801, as enacted by Laws of Utah 2016, Chapter 240
54          63M-2-802, as last amended by Laws of Utah 2018, Chapter 453
55          63M-2-803, as renumbered and amended by Laws of Utah 2016, Chapter 240
56          63N-1-501, as renumbered and amended by Laws of Utah 2015, Chapter 283
57          63N-3-204, as last amended by Laws of Utah 2018, Chapter 453
58          63N-3-305, as last amended by Laws of Utah 2016, Chapter 253

59          67-19-15, as last amended by Laws of Utah 2018, Chapters 39 and 415
60          67-22-2, as last amended by Laws of Utah 2018, Chapter 39
61     

62     Be it enacted by the Legislature of the state of Utah:
63          Section 1. Section 49-11-406 is amended to read:
64          49-11-406. Governor's appointed executives and senior staff -- Appointed
65     legislative employees -- Transfer of value of accrued defined benefit -- Procedures.
66          (1) As used in this section:
67          (a) "Defined benefit balance" means the total amount of the contributions made on
68     behalf of a member to a defined benefit system plus refund interest.
69          (b) "Senior staff" means an at-will employee who reports directly to an elected official,
70     executive director, or director and includes a deputy director and other similar, at-will
71     employee positions designated by the governor, the speaker of the House, or the president of
72     the Senate and filed with the Department of Human Resource Management and the Utah State
73     Retirement Office.
74          (2) In accordance with this section and subject to federal law, a member who has
75     service credit from a system may elect to be exempt from coverage under a defined benefit
76     system and to have the member's defined benefit balance transferred from the defined benefit
77     system or plan to a defined contribution plan in the member's own name if the member is:
78          (a) the state auditor;
79          (b) the state treasurer;
80          (c) an appointed executive under Subsection 67-22-2(1)(a);
81          (d) an employee in the Governor's Office;
82          (e) senior staff in the Governor's Office of Management and Budget;
83          (f) senior staff in the Governor's Office of Economic Development;
84          (g) senior staff in the Commission on Criminal and Juvenile Justice;
85          (h) a legislative employee appointed under Subsection 36-12-7(3)(a);
86          (i) a legislative employee appointed by the speaker of the House of Representatives, the
87     House of Representatives minority leader, the president of the Senate, or the Senate minority
88     leader; or
89          (j) senior staff of [the Utah Science Technology and Research Initiative] Innovate Utah

90     created under Title 63M, Chapter 2, Innovate Utah [Science Technology and Research
91     Governing Authority Act].
92          (3) An election made under Subsection (2):
93          (a) is final, and no right exists to make any further election;
94          (b) is considered a request to be exempt from coverage under a defined benefits
95     system; and
96          (c) shall be made on forms provided by the office.
97          (4) The board shall adopt rules to implement and administer this section.
98          Section 2. Section 49-13-203 is amended to read:
99          49-13-203. Exclusions from membership in system.
100          (1) The following employees are not eligible for service credit in this system:
101          (a) subject to the requirements of Subsection (2), an employee whose employment
102     status is temporary in nature due to the nature or the type of work to be performed;
103          (b) except as provided under Subsection (3)(a), an employee of an institution of higher
104     education who participates in a retirement system with a public or private retirement system,
105     organization, or company designated by the State Board of Regents, or the Board of Directors
106     of each technical college for an employee of each technical college, during any period in which
107     required contributions based on compensation have been paid on behalf of the employee by the
108     employer;
109          (c) an employee serving as an exchange employee from outside the state;
110          (d) an executive department head of the state or a legislative director, senior executive
111     employed by the governor's office, a member of the State Tax Commission, a member of the
112     Public Service Commission, and a member of a full-time or part-time board or commission
113     who files a formal request for exemption;
114          (e) an employee of the Department of Workforce Services who is covered under
115     another retirement system allowed under Title 35A, Chapter 4, Employment Security Act;
116          (f) an employee who is employed with an employer that has elected to be excluded
117     from participation in this system under Subsection 49-13-202(5), effective on or after the date
118     of the employer's election under Subsection 49-13-202(5);
119          (g) an employee who is employed with a withdrawing entity that has elected under
120     Section 49-11-623, prior to January 1, 2017, to exclude:

121          (i) new employees from participation in this system under Subsection 49-11-623(3)(a);
122     or
123          (ii) all employees from participation in this system under Subsection 49-11-623(3)(b);
124     or
125          (h) an employee described in Subsection (1)(h)(i) or (ii) who is employed with a
126     withdrawing entity that has elected under Section 49-11-624, before January 1, 2018, to
127     exclude:
128          (i) new employees from participation in this system under Subsection 49-11-624(3)(a);
129     or
130          (ii) all employees from participation in this system under Subsection 49-11-624(3)(b).
131          (2) If an employee whose status is temporary in nature due to the nature of type of
132     work to be performed:
133          (a) is employed for a term that exceeds six months and the employee otherwise
134     qualifies for service credit in this system, the participating employer shall report and certify to
135     the office that the employee is a regular full-time employee effective the beginning of the
136     seventh month of employment; or
137          (b) was previously terminated prior to being eligible for service credit in this system
138     and is reemployed within three months of termination by the same participating employer, the
139     participating employer shall report and certify that the member is a regular full-time employee
140     when the total of the periods of employment equals six months and the employee otherwise
141     qualifies for service credits in this system.
142          (3) (a) Upon cessation of the participating employer contributions, an employee under
143     Subsection (1)(b) is eligible for service credit in this system.
144          (b) Notwithstanding the provisions of Subsection (1)(f), any eligibility for service
145     credit earned by an employee under this chapter before the date of the election under
146     Subsection 49-13-202(5) is not affected under Subsection (1)(f).
147          (4) Upon filing a written request for exemption with the office, the following
148     employees shall be exempt from coverage under this system:
149          (a) a full-time student or the spouse of a full-time student and individuals employed in
150     a trainee relationship;
151          (b) an elected official;

152          (c) an executive department head of the state, a member of the State Tax Commission,
153     a member of the Public Service Commission, and a member of a full-time or part-time board or
154     commission;
155          (d) an employee of the Governor's Office of Management and Budget;
156          (e) an employee of the Governor's Office of Economic Development;
157          (f) an employee of the Commission on Criminal and Juvenile Justice;
158          (g) an employee of the Governor's Office;
159          (h) an employee of the State Auditor's Office;
160          (i) an employee of the State Treasurer's Office;
161          (j) any other member who is permitted to make an election under Section 49-11-406;
162          (k) a person appointed as a city manager or chief city administrator or another person
163     employed by a municipality, county, or other political subdivision, who is an at-will employee;
164          (l) an employee of an interlocal cooperative agency created under Title 11, Chapter 13,
165     Interlocal Cooperation Act, who is engaged in a specialized trade customarily provided through
166     membership in a labor organization that provides retirement benefits to its members; and
167          (m) an employee of [the Utah Science Technology and Research Initiative] Innovate
168     Utah created under Title 63M, Chapter 2, Innovate Utah [Science Technology and Research
169     Governing Authority Act].
170          (5) (a) Each participating employer shall prepare and maintain a list designating those
171     positions eligible for exemption under Subsection (4).
172          (b) An employee may not be exempted unless the employee is employed in a position
173     designated by the participating employer.
174          (6) (a) In accordance with this section, Section 49-12-203, and Section 49-22-205, a
175     municipality, county, or political subdivision may not exempt a total of more than 50 positions
176     or a number equal to 10% of the eligible employees of the municipality, county, or political
177     subdivision, whichever is less.
178          (b) A municipality, county, or political subdivision may exempt at least one regular
179     full-time employee.
180          (7) Each participating employer shall:
181          (a) maintain a list of employee exemptions; and
182          (b) update the employee exemptions in the event of any change.

183          (8) The office may make rules to implement this section.
184          Section 3. Section 49-22-205 is amended to read:
185          49-22-205. Exemptions from participation in system.
186          (1) Upon filing a written request for exemption with the office, the following
187     employees are exempt from participation in the system as provided in this section:
188          (a) an executive department head of the state;
189          (b) a member of the State Tax Commission;
190          (c) a member of the Public Service Commission;
191          (d) a member of a full-time or part-time board or commission;
192          (e) an employee of the Governor's Office of Management and Budget;
193          (f) an employee of the Governor's Office of Economic Development;
194          (g) an employee of the Commission on Criminal and Juvenile Justice;
195          (h) an employee of the Governor's Office;
196          (i) an employee of the State Auditor's Office;
197          (j) an employee of the State Treasurer's Office;
198          (k) any other member who is permitted to make an election under Section 49-11-406;
199          (l) a person appointed as a city manager or appointed as a city administrator or another
200     at-will employee of a municipality, county, or other political subdivision;
201          (m) an employee of an interlocal cooperative agency created under Title 11, Chapter
202     13, Interlocal Cooperation Act, who is engaged in a specialized trade customarily provided
203     through membership in a labor organization that provides retirement benefits to its members;
204     and
205          (n) an employee of [the Utah Science Technology and Research Initiative] Innovate
206     Utah created under Title 63M, Chapter 2, Innovate Utah [Science Technology and Research
207     Governing Authority Act].
208          (2) (a) A participating employer shall prepare and maintain a list designating those
209     positions eligible for exemption under Subsection (1).
210          (b) An employee may not be exempted unless the employee is employed in a position
211     designated by the participating employer under Subsection (1).
212          (3) (a) In accordance with this section, Section 49-12-203, and Section 49-13-203, a
213     municipality, county, or political subdivision may not exempt a total of more than 50 positions

214     or a number equal to 10% of the eligible employees of the municipality, county, or political
215     subdivision, whichever is less.
216          (b) A municipality, county, or political subdivision may exempt at least one regular
217     full-time employee.
218          (4) Each participating employer shall:
219          (a) maintain a list of employee exemptions; and
220          (b) update an employee exemption in the event of any change.
221          (5) Beginning on the effective date of the exemption for an employee who elects to be
222     exempt in accordance with Subsection (1):
223          (a) for a member of the Tier II defined contribution plan:
224          (i) the participating employer shall contribute the nonelective contribution and the
225     amortization rate described in Section 49-22-401, except that the nonelective contribution is
226     exempt from the vesting requirements of Subsection 49-22-401(3)(a); and
227          (ii) the member may make voluntary deferrals as provided in Section 49-22-401; and
228          (b) for a member of the Tier II hybrid retirement system:
229          (i) the participating employer shall contribute the nonelective contribution and the
230     amortization rate described in Section 49-22-401, except that the contribution is exempt from
231     the vesting requirements of Subsection 49-22-401(3)(a);
232          (ii) the member may make voluntary deferrals as provided in Section 49-22-401; and
233          (iii) the member is not eligible for additional service credit in the system.
234          (6) If an employee who is a member of the Tier II hybrid retirement system
235     subsequently revokes the election of exemption made under Subsection (1), the provisions
236     described in Subsection (5)(b) shall no longer be applicable and the coverage for the employee
237     shall be effective prospectively as provided in Part 3, Tier II Hybrid Retirement System.
238          (7) (a) All employer contributions made on behalf of an employee shall be invested in
239     accordance with Subsection 49-22-303(3)(a) or 49-22-401(4)(a) until the one-year election
240     period under Subsection 49-22-201(2)(c) is expired if the employee:
241          (i) elects to be exempt in accordance with Subsection (1); and
242          (ii) continues employment with the participating employer through the one-year
243     election period under Subsection 49-22-201(2)(c).
244          (b) An employee is entitled to receive a distribution of the employer contributions

245     made on behalf of the employee and all associated investment gains and losses if the employee:
246          (i) elects to be exempt in accordance with Subsection (1); and
247          (ii) terminates employment prior to the one-year election period under Subsection
248     49-22-201(2)(c).
249          (8) (a) The office shall make rules to implement this section.
250          (b) The rules made under this Subsection (8) shall include provisions to allow the
251     exemption provided under Subsection (1) to apply to all contributions made beginning on or
252     after July 1, 2011, on behalf of an exempted employee who began the employment before May
253     8, 2012.
254          Section 4. Section 53B-17-1101 is amended to read:
255          53B-17-1101. Definitions.
256          As used in this part:
257          (1) "Researcher" means an individual who:
258          (a) on May 8, 2018, is employed, alone or as part of a research team, by the university;
259          (b) before May 8, 2018, received funding from USTAR for some or all of the
260     researcher's startup costs or salary;
261          (c) was recruited to become a member of the university's faculty; and
262          (d) after May 8, 2018, receives some or all of the researcher's start up costs or salary
263     from a legislative appropriation to the university for that purpose.
264          (2) "University" means the University of Utah.
265          (3) "USTAR" means the Utah Science Technology and Research Initiative, which is
266     now known as the Innovate Utah program created in Section 63M-2-301.
267          Section 5. Section 53B-18-1601 is amended to read:
268          53B-18-1601. Definitions.
269          As used in this part:
270          (1) "Researcher" means an individual who:
271          (a) on May 8, 2018, is employed, alone or as part of a research team, by the university;
272          (b) before May 8, 2018, received funding from USTAR for some or all of the
273     researcher's startup costs or salary;
274          (c) was recruited to become a member of the university's faculty; and
275          (d) after May 8, 2018, receives some or all of the researcher's start up costs or salary

276     from a legislative appropriation to the university for that purpose.
277          (2) "University" means Utah State University.
278          (3) "USTAR" means the Utah Science Technology and Research Initiative, which is
279     now known as the Innovate Utah program created in Section 63M-2-301.
280          Section 6. Section 53F-2-203 is amended to read:
281          53F-2-203. Reduction of local education board allocation based on insufficient
282     revenues.
283          (1) As used in this section, "Minimum School Program funds" means the total of state
284     and local funds appropriated for the Minimum School Program, excluding:
285          (a) an appropriation for a state guaranteed local levy increment as described in Section
286     53F-2-601; and
287          (b) the appropriation to charter schools to replace local property tax revenues pursuant
288     to Section 53F-2-704.
289          (2) If the Legislature reduces appropriations made to support public schools under this
290     chapter because an Education Fund budget deficit, as defined in Section 63J-1-312, exists, the
291     State Board of Education, after consultation with each local education board, shall allocate the
292     reduction among school districts and charter schools in proportion to each school district's or
293     charter school's percentage share of Minimum School Program funds.
294          (3) Except as provided in Subsection (5) and subject to the requirements of Subsection
295     (7), a local education board shall determine which programs are affected by a reduction
296     pursuant to Subsection (2) and the amount each program is reduced.
297          (4) Except as provided in Subsections (5) and (6), the requirement to spend a specified
298     amount in any particular program is waived if reductions are made pursuant to Subsection (2).
299          (5) A local education board may not reduce or reallocate spending of funds distributed
300     to the school district or charter school for the following programs:
301          (a) educator salary adjustments provided in Section 53F-2-405;
302          (b) the Teacher Salary Supplement Program provided in Section 53F-2-504;
303          (c) the extended year for special educators provided in Section 53F-2-310;
304          (d) [USTAR] Innovate Utah centers provided in Section 53F-2-505;
305          (e) the School LAND Trust Program described in Sections 53F-2-404 and 53F-7-1206;
306     or

307          (f) a special education program within the basic school program.
308          (6) A local education board may not reallocate spending of funds distributed to the
309     school district or charter school to a reserve account.
310          (7) A local education board that reduces or reallocates funds in accordance with this
311     section shall report all transfers into, or out of, Minimum School Program programs to the
312     State Board of Education as part of the school district or charter school's Annual Financial and
313     Program report.
314          Section 7. Section 53F-2-414 is amended to read:
315          53F-2-414. Review of related to basic school programs.
316          (1) No later than November 30, 2018, the Public Education Appropriations
317     Subcommittee shall:
318          (a) review and make recommendations on each program in the related to basic school
319     programs described in Subsection (3);
320          (b) adopt a review schedule going forward for each program described in Subsection
321     (3), placing a program on a schedule to review annually or every four years; and
322          (c) review annually or every four years each program according to the schedule adopted
323     under Subsection (1)(b).
324          (2) For a related to basic school program that is not listed in Subsection (3) and is
325     adopted by the Legislature after January 1, 2018, the Public Education Appropriations
326     Subcommittee shall:
327          (a) review and make recommendations for the program in the program's initial year of
328     implementation;
329          (b) adopt a review schedule going forward for the program, placing the program on a
330     schedule to review annually or every four years; and
331          (c) review annually or every four years the program according to the schedule adopted
332     under Subsection (2)(b).
333          (3) The programs subject to review under Subsection (1) are the following:
334          (a) the state-supported transportation program described in Section 53F-2-403;
335          (b) the state contribution guarantee program for transportation described in Section
336     53F-2-403;
337          (c) the weighted pupil unit flexibility allocations described in Section 53F-2-205;

338          (d) the Enhancement for At-Risk Students Program described in Section 53F-2-410;
339          (e) the youth in custody program described in Section 53E-3-503;
340          (f) the adult education program described in Title 53E, Chapter 10, Part 2, Adult
341     Education;
342          (g) the Enhancement for Accelerated Students Program described in Section
343     53F-2-408;
344          (h) the Centennial Scholarship Program described in Section 53F-2-501;
345          (i) the concurrent enrollment program described in Title 53E, Chapter 10, Part 3,
346     Concurrent Enrollment;
347          (j) the Title I Schools Paraeducators Program described in Section 53F-2-411;
348          (k) the School LAND Trust Program described in Section 53F-2-404;
349          (l) the charter school local replacement funding program described in Section
350     53F-2-702;
351          (m) the charter school administration allocations described in Section 53F-2-306;
352          (n) the K-3 Reading Improvement Program described in Section 53F-2-503;
353          (o) the educator salary adjustments described in Section 53F-2-405;
354          (p) the Teacher Salary Supplement Program described in Section 53F-2-504;
355          (q) the school library books and electronic resources appropriation described in Section
356     53F-2-407;
357          (r) the matching appropriation for school nurses described in Section 53F-2-519;
358          (s) the Critical Languages Program described in Section 53F-2-516;
359          (t) the Dual Language Immersion Program described in Section 53F-2-502;
360          (u) the [Utah Science Technology and Research (USTAR) Initiative] Innovate Utah
361     Centers Program described in Section 53F-2-505;
362          (v) the Beverley Taylor Sorenson Elementary Arts Learning Program described in
363     Section 53F-2-506;
364          (w) the early intervention program described in Section 53F-2-507; and
365          (x) the Digital Teaching and Learning Grant Program described in Section 53F-2-510.
366          Section 8. Section 53F-2-505 is amended to read:
367          53F-2-505. Utah Science Technology and Research Initiative Centers Program.
368          (1) (a) The [Utah Science Technology and Research Initiative (USTAR)] Innovate

369     Utah Centers Program is created to provide a financial incentive for local education boards to
370     adopt programs in respective charter schools and school districts that result in a more efficient
371     use of human resources and capital facilities.
372          (b) The potential benefits of the program include:
373          (i) increased compensation for math and science teachers by providing opportunities
374     for an expanded contract year which will enhance school districts' and charter schools' ability to
375     attract and retain talented and highly qualified math and science teachers;
376          (ii) increased capacity of school buildings by using buildings more hours of the day or
377     more days of the year, resulting in reduced capital facilities costs;
378          (iii) decreased class sizes created by expanding the number of instructional
379     opportunities in a year;
380          (iv) opportunities for earlier high school graduation;
381          (v) improved student college preparation;
382          (vi) increased opportunities to offer additional remedial and advanced courses in math
383     and science;
384          (vii) opportunities to coordinate high school and post-secondary math and science
385     education; and
386          (viii) the creation or improvement of science, technology, engineering, and math
387     centers (STEM Centers).
388          (2) From money appropriated for the [USTAR] Innovate Utah Centers Program, the
389     State Board of Education shall award grants to charter schools and school districts to pay for
390     costs related to the adoption and implementation of the program.
391          (3) The State Board of Education shall:
392          (a) solicit proposals from the State Charter School Board and local school boards for
393     the use of grant money to facilitate the adoption and implementation of the program; and
394          (b) award grants on a competitive basis.
395          (4) The State Charter School Board shall:
396          (a) solicit proposals from charter school governing boards that may be interested in
397     participating in the [USTAR] Innovate Utah Centers Program;
398          (b) prioritize and consolidate the proposals into the equivalent of a single school
399     district request; and

400          (c) submit the consolidated request to the State Board of Education.
401          (5) In selecting a grant recipient, the State Board of Education shall consider:
402          (a) the degree to which a charter school or school district's proposed adoption and
403     implementation of an extended year for math and science teachers achieves the benefits
404     described in Subsection (1);
405          (b) the unique circumstances of different urban, rural, large, small, growing, and
406     declining charter schools and school districts; and
407          (c) providing pilot programs in as many different school districts and charter schools as
408     possible.
409          (6) (a) Except as provided in Subsection (6)(b), a school district or charter school may
410     only use grant money to provide full year teacher contracts, part-time teacher contract
411     extensions, or combinations of both, for math and science teachers.
412          (b) Up to 5% of the grant money may be used to fund math and science field trips,
413     textbooks, and supplies.
414          (7) Participation in the [USTAR] Innovate Utah Centers Program shall be:
415          (a) voluntary for an individual teacher; and
416          (b) voluntary for a charter school or school district.
417          Section 9. Section 63A-3-110 is amended to read:
418          63A-3-110. Personal use expenditures for state officers and employees.
419          (1) As used in this section:
420          (a) "Employee" means a person who is not an elected or appointed officer and who is
421     employed on a full- or part-time basis by a governmental entity.
422          (b) "Governmental entity" means:
423          (i) an executive branch agency of the state, the offices of the governor, lieutenant
424     governor, state auditor, attorney general, and state treasurer, the State Board of Education, and
425     the State Board of Regents;
426          (ii) the Office of the Legislative Auditor General, the Office of the Legislative Fiscal
427     Analyst, the Office of Legislative Research and General Counsel, the Legislature, and
428     legislative committees;
429          (iii) courts, the Judicial Council, the Administrative Office of the Courts, and similar
430     administrative units in the judicial branch;

431          (iv) independent state entities created under Title 63H, Independent State Entities; or
432          (v) the [Utah Science Technology and Research Governing Authority] Innovate Utah
433     program created under Section 63M-2-301.
434          (c) "Officer" means a person who is elected or appointed to an office or position within
435     a governmental entity.
436          (d) (i) "Personal use expenditure" means an expenditure made without the authority of
437     law that:
438          (A) is not directly related to the performance of an activity as a state officer or
439     employee;
440          (B) primarily furthers a personal interest of a state officer or employee or a state
441     officer's or employee's family, friend, or associate; and
442          (C) would constitute taxable income under federal law.
443          (ii) "Personal use expenditure" does not include:
444          (A) a de minimis or incidental expenditure; or
445          (B) a state vehicle or a monthly stipend for a vehicle that an officer or employee uses to
446     travel to and from the officer or employee's official duties, including a minimal allowance for a
447     detour as provided by the state.
448          (e) "Public funds" means the same as that term is defined in Section 51-7-3.
449          (2) A state officer or employee may not:
450          (a) use public funds for a personal use expenditure; or
451          (b) incur indebtedness or liability on behalf of, or payable by, a governmental entity for
452     a personal use expenditure.
453          (3) If the Division of Finance or the responsible governmental entity determines that a
454     state officer or employee has intentionally made a personal use expenditure in violation of
455     Subsection (2), the governmental entity shall:
456          (a) require the state officer or employee to deposit the amount of the personal use
457     expenditure into the fund or account from which:
458          (i) the personal use expenditure was disbursed; or
459          (ii) payment for the indebtedness or liability for a personal use expenditure was
460     disbursed;
461          (b) require the state officer or employee to remit an administrative penalty in an

462     amount equal to 50% of the personal use expenditure to the Division of Finance; and
463          (c) deposit the money received under Subsection (3)(b) into the General Fund.
464          (4) (a) Any state officer or employee who has been found by a governmental entity to
465     have made a personal use expenditure in violation of Subsection (2) may appeal the finding of
466     the governmental entity.
467          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
468     Division of Finance shall make rules regarding an appeal process for an appeal made under
469     Subsection (4)(a), including the designation of an appeal authority.
470          (5) (a) Subject to Subsection (5)(b), the Division of Finance may withhold all or a
471     portion of the wages of a state officer or employee who has violated Subsection (2) until the
472     requirements of Subsection (3) have been met.
473          (b) If the state officer or employee has requested an appeal under Subsection (4), the
474     Division of Finance may only withhold the wages of the officer or employee after the appeal
475     authority described in Subsection (4)(b) has confirmed that the officer or employee violated
476     Subsection (2).
477          (6) Nothing in this chapter immunizes a state officer or employee from or precludes
478     any criminal prosecution or civil or employment action for an unlawful personal use
479     expenditure.
480          (7) A state officer or employee who has been convicted of misusing public money
481     under Section 76-8-402 may not disburse public funds or access public accounts.
482          Section 10. Section 63A-5-204 is amended to read:
483          63A-5-204. Specific powers and duties of director.
484          (1) As used in this section, "capitol hill facilities" and "capitol hill grounds" have the
485     same meaning as provided in Section 63C-9-102.
486          (2) (a) The director shall:
487          (i) recommend rules to the executive director for the use and management of facilities
488     and grounds owned or occupied by the state for the use of its departments and agencies;
489          (ii) supervise and control the allocation of space, in accordance with legislative
490     directive through annual appropriations acts or other specific legislation, to the various
491     departments, commissions, institutions, and agencies in all buildings or space owned, leased, or
492     rented by or to the state, except capitol hill facilities and capitol hill grounds and except as

493     otherwise provided by law;
494          (iii) comply with the procedures and requirements of Title 63A, Chapter 5, Part 3,
495     Division of Facilities Construction and Management Leasing;
496          (iv) except as provided in Subsection (2)(b), acquire, as authorized by the Legislature
497     through the appropriations act or other specific legislation, and hold title to, in the name of the
498     division, all real property, buildings, fixtures, or appurtenances owned by the state or any of its
499     agencies;
500          (v) collect and maintain all deeds, abstracts of title, and all other documents evidencing
501     title to or interest in property belonging to the state or any of its departments, except
502     institutions of higher education and the School and Institutional Trust Lands Administration;
503          (vi) report all properties acquired by the state, except those acquired by institutions of
504     higher education, to the director of the Division of Finance for inclusion in the state's financial
505     records;
506          (vii) before charging a rate, fee, or other amount for services provided by the division's
507     internal service fund to an executive branch agency, or to a subscriber of services other than an
508     executive branch agency:
509          (A) submit the proposed rates, fees, and cost analysis to the Rate Committee
510     established in Section 63A-1-114; and
511          (B) obtain the approval of the Legislature as required by Section 63J-1-410;
512          (viii) conduct a market analysis by July 1, 2005, and periodically thereafter, of
513     proposed rates and fees, which analysis shall include a comparison of the division's rates and
514     fees with the fees of other public or private sector providers where comparable services and
515     rates are reasonably available;
516          (ix) implement the State Building Energy Efficiency Program under Section
517     63A-5-701;
518          (x) convey, lease, or dispose of the real property or water rights associated with the
519     Utah State Developmental Center according to the Utah State Developmental Center Board's
520     determination, as described in Subsection 62A-5-206.6(5);
521          (xi) after receiving the notice required under Subsection 10-2-419(2)(d), file a written
522     protest at or before the public hearing required under Subsection 10-2-419(2)(b), if:
523          (A) it is in the best interest of the state to protest the boundary adjustment; or

524          (B) the Legislature instructs the director to protest the boundary adjustment; and
525          (xii) take all other action necessary for carrying out the purposes of this chapter.
526          (b) Legislative approval is not required for acquisitions by the division that cost less
527     than $250,000.
528          (3) (a) The director shall direct or delegate maintenance and operations, preventive
529     maintenance, and facilities inspection programs and activities for any agency, except:
530          (i) the State Capitol Preservation Board; and
531          (ii) state institutions of higher education.
532          (b) The director may choose to delegate responsibility for these functions only when
533     the director determines that:
534          (i) the agency has requested the responsibility;
535          (ii) the agency has the necessary resources and skills to comply with facility
536     maintenance standards approved by the State Building Board; and
537          (iii) the delegation would result in net cost savings to the state as a whole.
538          (c) The State Capitol Preservation Board and state institutions of higher education are
539     exempt from Division of Facilities Construction and Management oversight.
540          (d) Each state institution of higher education shall comply with the facility
541     maintenance standards approved by the State Building Board.
542          (e) Except for the State Capitol Preservation Board, agencies and institutions that are
543     exempt from division oversight shall annually report their compliance with the facility
544     maintenance standards to the division in the format required by the division.
545          (f) The division shall:
546          (i) prescribe a standard format for reporting compliance with the facility maintenance
547     standards;
548          (ii) report agency compliance or noncompliance with the standards to the Legislature;
549     and
550          (iii) conduct periodic audits of exempt agencies and institutions to ensure that they are
551     complying with the standards.
552          (4) (a) In making any allocations of space under Subsection (2), the director shall:
553          (i) conduct studies to determine the actual needs of each agency; and
554          (ii) comply with the restrictions contained in this Subsection (4).

555          (b) The supervision and control of the legislative area is reserved to the Legislature.
556          (c) The supervision and control of the judicial area is reserved to the judiciary for trial
557     courts only.
558          (d) The director may not supervise or control the allocation of space for entities in the
559     public and higher education systems.
560          (e) The supervision and control of capitol hill facilities and capitol hill grounds is
561     reserved to the State Capitol Preservation Board.
562          (5) The director may:
563          (a) hire or otherwise procure assistance and services, professional, skilled, or
564     otherwise, that are necessary to carry out the director's responsibilities, and may expend funds
565     provided for that purpose either through annual operating budget appropriations or from
566     nonlapsing project funds;
567          (b) sue and be sued in the name of the division; and
568          (c) hold, buy, lease, and acquire by exchange or otherwise, as authorized by the
569     Legislature, whatever real or personal property that is necessary for the discharge of the
570     director's duties.
571          (6) Notwithstanding the provisions of Subsection (2)(a)(iv), the following entities may
572     hold title to any real property, buildings, fixtures, and appurtenances held by them for purposes
573     other than administration that are under their control and management:
574          (a) the Office of Trust Administrator;
575          (b) the Department of Transportation;
576          (c) the Division of Forestry, Fire, and State Lands;
577          (d) the Department of Natural Resources;
578          (e) the Utah National Guard;
579          (f) any area vocational center or other institution administered by the State Board of
580     Education; and
581          (g) any institution of higher education[; and].
582          [(h) the Utah Science Technology and Research Governing Authority.]
583          (7) The director shall ensure that any firm performing testing and inspection work
584     governed by the American Society for Testing Materials Standard E-329 on public buildings
585     under the director's supervision shall:

586          (a) fully comply with the American Society for Testing Materials standard
587     specifications for agencies engaged in the testing and inspection of materials known as ASTM
588     E-329; and
589          (b) carry a minimum of $1,000,000 of errors and omissions insurance.
590          (8) Notwithstanding Subsections (2)(a)(iii) and (iv), the School and Institutional Trust
591     Lands Administration may hold title to any real property, buildings, fixtures, and appurtenances
592     held by it that are under its control.
593          Section 11. Section 63J-1-602.2 is amended to read:
594          63J-1-602.2. List of nonlapsing appropriations to programs.
595          Appropriations made to the following programs are nonlapsing:
596          (1) The Legislature and its committees.
597          (2) The Percent-for-Art Program created in Section 9-6-404.
598          (3) The LeRay McAllister Critical Land Conservation Program created in Section
599     11-38-301.
600          (4) Dedicated credits accrued to the Utah Marriage Commission as provided under
601     Subsection 17-16-21(2)(d)(ii).
602          (5) The Division of Wildlife Resources for the appraisal and purchase of lands under
603     the Pelican Management Act, as provided in Section 23-21a-6.
604          (6) The primary care grant program created in Section 26-10b-102.
605          (7) Sanctions collected as dedicated credits from Medicaid provider under Subsection
606     26-18-3(7).
607          (8) The Utah Health Care Workforce Financial Assistance Program created in Section
608     26-46-102.
609          (9) The Rural Physician Loan Repayment Program created in Section 26-46a-103.
610          (10) The Opiate Overdose Outreach Pilot Program created in Section 26-55-107.
611          (11) Funds that the Department of Alcoholic Beverage Control retains in accordance
612     with Subsection 32B-2-301(7)(a)(ii) or (b).
613          (12) The General Assistance program administered by the Department of Workforce
614     Services, as provided in Section 35A-3-401.
615          (13) A new program or agency that is designated as nonlapsing under Section
616     36-24-101.

617          (14) The Utah National Guard, created in Title 39, Militia and Armories.
618          (15) The State Tax Commission under Section 41-1a-1201 for the:
619          (a) purchase and distribution of license plates and decals; and
620          (b) administration and enforcement of motor vehicle registration requirements.
621          (16) The Search and Rescue Financial Assistance Program, as provided in Section
622     53-2a-1102.
623          (17) The Motorcycle Rider Education Program, as provided in Section 53-3-905.
624          (18) The State Board of Regents for teacher preparation programs, as provided in
625     Section 53B-6-104.
626          (19) The Medical Education Program administered by the Medical Education Council,
627     as provided in Section 53B-24-202.
628          (20) The State Board of Education, as provided in Section 53F-2-205.
629          (21) The Division of Services for People with Disabilities, as provided in Section
630     62A-5-102.
631          (22) The Division of Fleet Operations for the purpose of upgrading underground
632     storage tanks under Section 63A-9-401.
633          (23) The Utah Seismic Safety Commission, as provided in Section 63C-6-104.
634          (24) Appropriations to the Department of Technology Services for technology
635     innovation as provided under Section 63F-4-202.
636          (25) The Office of Administrative Rules for publishing, as provided in Section
637     63G-3-402.
638          (26) The [Utah Science Technology and Research Initiative] Innovate Utah program
639     created in Section 63M-2-301.
640          (27) The Governor's Office of Economic Development to fund the Enterprise Zone
641     Act, as provided in Title 63N, Chapter 2, Part 2, Enterprise Zone Act.
642          (28) Appropriations to fund the Governor's Office of Economic Development's Rural
643     Employment Expansion Program, as described in Title 63N, Chapter 4, Part 4, Rural
644     Employment Expansion Program.
645          (29) The Department of Human Resource Management user training program, as
646     provided in Section 67-19-6.
647          (30) The University of Utah Poison Control Center program, as provided in Section

648     69-2-5.5.
649          (31) A public safety answering point's emergency telecommunications service fund, as
650     provided in Section 69-2-301.
651          (32) The Traffic Noise Abatement Program created in Section 72-6-112.
652          (33) The Judicial Council for compensation for special prosecutors, as provided in
653     Section 77-10a-19.
654          (34) A state rehabilitative employment program, as provided in Section 78A-6-210.
655          (35) The Utah Geological Survey, as provided in Section 79-3-401.
656          (36) The Bonneville Shoreline Trail Program created under Section 79-5-503.
657          (37) Adoption document access as provided in Sections 78B-6-141, 78B-6-144, and
658     78B-6-144.5.
659          (38) Indigent defense as provided in Title 77, Chapter 32, Part 8, Utah Indigent
660     Defense Commission.
661          Section 12. Section 63M-2-101 is amended to read:
662     
CHAPTER 2. INNOVATE UTAH

663          63M-2-101. Title.
664          (1) This title is known as "Governor's Programs."
665          (2) This chapter is known as [the "Utah Science Technology and Research Governing
666     Authority Act."] "Innovate Utah."
667          Section 13. Section 63M-2-102 is amended to read:
668          63M-2-102. Definitions.
669          As used in this chapter:
670          (1) "Executive director" means the individual appointed under Subsection
671     63M-2-301(9).
672          (2) "Governing authority" means the [Utah Science Technology and Research]
673     Innovate Utah Governing Authority created in Section 63M-2-301.
674          (3) "Higher education institution" means an institution listed in Section 53B-2-101.
675          [(4) "Principal researcher" means an individual who:]
676          [(a) (i) on May 10, 2016, is employed, alone or as part of a research team, by a research
677     university;]
678          [(ii) before May 10, 2016, received funding from USTAR for some or all of the

679     researcher's startup costs or research university salary;]
680          [(iii) was recruited by a research university to become a member of a research
681     university's faculty; and]
682          [(iv) on or after May 10, 2016, continues to receive USTAR support; or]
683          [(b) (i) is employed on or after May 10, 2016 as a researcher by a higher education
684     institution;]
685          [(ii) receives USTAR support; and]
686          [(iii) is recruited by the governing authority and the higher education institution to
687     become a member of the higher education institution's faculty.]
688          [(5) "Private entity":]
689          [(a) means a privately owned corporation, limited liability company, partnership, or
690     other business entity or association; and]
691          [(b) does not include an individual or a sole proprietorship.]
692          [(6) "Research building" means a building:]
693          [(a) for which the governing authority holds title; and]
694          [(b) that is located on the campus of a research university.]
695          [(7) "Research university" means:]
696          [(a) the University of Utah; or]
697          [(b) Utah State University.]
698          [(8)] (4) ["USTAR"] "Innovate Utah" means the [Utah Science Technology and
699     Research Initiative] Innovate Utah program created in Section 63M-2-301.
700          [(9)] (5) ["USTAR] "Innovate Utah researcher" means:
701          (a) a principal researcher; or
702          (b) an individual, other than a principal researcher, who:
703          (i) is employed by a higher education institution; and
704          (ii) receives [USTAR] Innovate Utah support.
705          [(10)] (6) ["USTAR] "Innovate Utah support" means assistance provided by [USTAR]
706     Innovate Utah, including:
707          (a) financial support;
708          (b) technical assistance;
709          (c) mentoring; and

710          (d) the use of:
711          (i) research or laboratory space controlled by [USTAR] Innovate Utah in a building
712     other than a research building; and
713          (ii) equipment in research or laboratory space described in Subsection [(10)] (6)(d)(i).
714          (7) "Principal researcher" means an individual who:
715          (a) (i) on May 10, 2016, is employed, alone or as part of a research team, by a research
716     university;
717          (ii) before May 10, 2016, received funding from Innovate Utah for some or all of the
718     researcher's startup costs or research university salary;
719          (iii) was recruited by a research university to become a member of a research
720     university's faculty; and
721          (iv) on or after May 10, 2016, continues to receive Innovate Utah support; or
722          (b) (i) is employed on or after May 10, 2016 as a researcher by a higher education
723     institution;
724          (ii) receives Innovate Utah support; and
725          (iii) is recruited by the governing authority and the higher education institution to
726     become a member of the higher education institution's faculty.
727          (8) "Private entity":
728          (a) means a privately owned corporation, limited liability company, partnership, or
729     other business entity or association; and
730          (b) does not include an individual or a sole proprietorship.
731          (9) "Research building" means a building:
732          (a) for which the governing authority holds title; and
733          (b) that is located on the campus of a research university.
734          (10) "Research university" means:
735          (a) the University of Utah; or
736          (b) Utah State University.
737          Section 14. Section 63M-2-301 is amended to read:
738     
Part 3. Innovate Utah Governing Authority

739          63M-2-301. The Innovate Utah program -- Governing authority -- Executive
740     director.

741          (1) There is created the [Utah Science Technology and Research Initiative] Innovate
742     Utah program.
743          (2) To oversee [USTAR] Innovate Utah, there is created the[ Utah Science Technology
744     and Research] Innovate Utah Governing Authority consisting of:
745          (a) the state treasurer or the state treasurer's designee;
746          [(b) the executive director of the Governor's Office of Economic Development;]
747          [(c)] (b) three members appointed by the governor, with the consent of the Senate;
748          [(d)] (c) two members appointed by the president of the Senate;
749          [(e)] (d) two members appointed by the speaker of the House of Representatives; and
750          [(f)] (e) one member appointed by the commissioner of higher education.
751          (3) (a) The eight appointed members under Subsections (2)[(c) through (f)] (b) through
752     (e) shall serve four-year staggered terms.
753          (b) An appointed member under Subsection (2)[(c), (d), (e), or (f)] (b), (c), (d), or (e):
754          (i) may not serve more than two full consecutive terms; and
755          (ii) may be removed from the governing authority for any reason before the member's
756     term is completed:
757          (A) at the discretion of the original appointing authority; and
758          (B) after the original appointing authority consults with the governing authority.
759          (4) A vacancy on the governing authority in an appointed position under Subsection
760     (2)[(c), (d), (e), or (f)] (b), (c), (d), or (e) shall be filled for the unexpired term by the
761     appointing authority in the same manner as the original appointment.
762          (5) (a) Except as provided in Subsection (5)(b), the governor, with the consent of the
763     Senate, shall select the chair of the governing authority to serve a one-year term.
764          (b) The governor may extend the term of a sitting chair of the governing authority
765     without the consent of the Senate.
766          [(c) The executive director of the Governor's Office of Economic Development shall
767     serve as the vice chair of the governing authority.]
768          (6) The governing authority shall meet at least six times each year and may meet more
769     frequently at the request of a majority of the members of the governing authority.
770          (7) Five members of the governing authority are a quorum.
771          (8) A member of the governing authority may not receive compensation or benefits for

772     the member's service, but may receive per diem and travel expenses as allowed in:
773          (a) Section 63A-3-106;
774          (b) Section 63A-3-107; and
775          (c) rules made by the Division of Finance:
776          (i) pursuant to Sections 63A-3-106 and 63A-3-107; and
777          (ii) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
778          (9) (a) After consultation with the governing authority, the governor, with the consent
779     of the Senate, shall appoint a full-time executive director to provide staff support for the
780     governing authority.
781          (b) The executive director is an at-will employee who may be terminated with or
782     without cause by[: (i) the governor; or (ii) majority vote of the governing authority] the
783     governor.
784          Section 15. Section 63M-2-302 is amended to read:
785          63M-2-302. Governing authority powers and duties.
786          (1) The governing authority shall:
787          (a) ensure that funds appropriated to [USTAR] Innovate Utah are used appropriately,
788     effectively, and efficiently in accordance with this chapter;
789          (b) in cooperation with a research university's administration, work to expand research
790     at the research university;
791          (c) enhance technology transfer and commercialization of research and technology
792     developed at a higher education institution to create high-quality jobs and new industries in the
793     private sector in the state;
794          (d) ensure that [USTAR] Innovate Utah programs do not duplicate existing or planned
795     programs of other state agencies;
796          (e) establish written economic development objectives for [USTAR] Innovate Utah
797     that are measurable and verifiable;
798          (f) consider input from the Governor's Office of Economic Development and higher
799     education institutions;
800          (g) establish and administer a grant program, as provided in Section 63M-2-503, and
801     provide [USTAR] Innovate Utah support, as provided in Section 63M-2-504, consistent with
802     and to further economic development objectives that the governing authority establishes; and

803          (h) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
804     make rules to implement this chapter.
805          (2) The governing authority may:
806          (a) in addition to receiving money appropriated by the Legislature, receive
807     contributions to [USTAR] Innovate Utah from any source, in the form of money, property,
808     labor, or other thing of value;
809          (b) subject to restrictions imposed by a donor or legislative appropriation, allocate
810     money for programs and activities described in this chapter;
811          (c) enter into an agreement necessary to obtain private equity investment in [USTAR]
812     Innovate Utah;
813          (d) charge and collect rent for space in a facility or building that [USTAR] Innovate
814     Utah controls;
815          (e) in fulfilling the governing authority's duties and responsibilities under this chapter,
816     collaborate with:
817          (i) the Governor's Office of Economic Development and other state agencies with an
818     interest in economic development; and
819          (ii) private entities with an interest in economic development; and
820          (f) delegate powers and duties to the executive director.
821          (3) A state agency, higher education institution, or political subdivision with which the
822     governing authority seeks to collaborate in fulfilling the governing authority's duties under this
823     chapter shall cooperate with the governing authority as reasonably necessary to enable the
824     governing authority to fulfill its duties under this chapter.
825          Section 16. Section 63M-2-302.5 is amended to read:
826          63M-2-302.5. Governing authority requirements.
827          The governing authority is subject to the requirements of an executive branch agency
828     and is:
829          (1) an agency for purposes of Title 63J, Chapter 1, Budgetary Procedures Act;
830          (2) an executive branch procurement unit for purposes of Title 63G, Chapter 6a, Utah
831     Procurement Code;
832          (3) a governmental entity for purposes of Title 63G, Chapter 2, Government Records
833     Access and Management Act; and

834          (4) a public body for purposes of Title 52, Chapter 4, Open and Public Meetings Act.
835          Section 17. Section 63M-2-501 is amended to read:
836     
Part 5. Innovate Utah Support

837          63M-2-501. Title.
838          This part is known as ["USTAR] "Innovate Utah Support."
839          Section 18. Section 63M-2-502 is amended to read:
840          63M-2-502. Principal researchers -- Agreement requirements -- Discontinuing
841     funding.
842          (1) Subject to [Subsection] Subsections (5) and (6) and legislative appropriation, the
843     governing authority shall:
844          (a) provide funding to help a research university honor its commitments to principal
845     researchers employed by the research university; and
846          (b) give priority to funding provided under Subsection (1)(a).
847          (2) The governing authority shall enter into a written agreement with a higher
848     education institution that employs a principal researcher[: (a)] establishing performance
849     standards and expectations for a principal researcher[; and].
850          [(b) requiring the higher education institution to require a principal researcher to
851     comply with reporting requirements set forth in Section 63M-2-702.]
852          (3) (a) A principal researcher may not be hired on or after May 10, 2016 without the
853     approval of the governing authority and the higher education institution.
854          (b) A higher education institution that enters into or renews an agreement with a
855     principal researcher on or after May 10, 2016 shall include in the agreement:
856          (i) a specific time period for the commitment of [USTAR] Innovate Utah funding;
857          (ii) the amount of [USTAR] Innovate Utah funding committed to the higher education
858     institution for the principal researcher, specifying the purpose of the funding;
859          (iii) an acknowledgment that the principal researcher understands and agrees to the
860     reporting requirements and performance standards under this chapter; and
861          (iv) the governing authority's written approval of the terms of the new or renewed
862     agreement.
863          [(4) The governing authority may not allocate money to a higher education institution
864     for a principal researcher unless the higher education institution provides the reporting required

865     under Section 63M-2-702.]
866          [(5)] (4) The governing authority may discontinue allocating money to a higher
867     education institution for a principal researcher if the governing authority and the president of
868     the higher education institution employing the principal researcher agree in writing that:
869          (a) the principal researcher:
870          (i) fails to meet the performance standards and expectations established under
871     Subsection (2)[(a)];
872          (ii) receives a reasonable opportunity to remedy the failure to meet performance
873     standards and expectations; and
874          (iii) fails to remedy the failure to meet performance standards and expectations; and
875          (b) under the circumstances, discontinuing [USTAR] Innovate Utah funding to the
876     higher education institution for the principal researcher is appropriate and justified.
877          [(6)] (5) Beginning on July 1, 2018, [USTAR] Innovate Utah may not provide funding
878     to help a research university honor its commitments to principal researchers employed by the
879     research university.
880          (6) Beginning on May 14, 2019, Innovate Utah may liquidate funds from escrow
881     accounts to the University of Utah and Utah State University.
882          Section 19. Section 63M-2-503 is amended to read:
883          63M-2-503. Innovate Utah grant programs.
884          (1) The governing authority shall establish at least one competitive grant program that:
885          (a) is designed to:
886          (i) address market gaps in technology development in the state[; or], including:
887          (A) technology sectors centered in hard sciences; or
888          (B) technologies facing market entry barriers, including high capital requirements; or
889          (ii) facilitate research and development of promising technologies;
890          (b) does not overlap with or duplicate other state funded programs; and
891          (c) offers grants, on a competitive basis, to:
892          (i) researchers employed by higher education institutions;
893          (ii) private entities; or
894          (iii) partnerships between researchers employed by higher education institutions and
895     private entities.

896          (2) The grants described in Subsection (1)(c) may be offered for the following
897     purposes:
898          (a) developing general technology;
899          (b) commercializing activities;
900          (c) securing intellectual property protections;
901          (d) providing salaries for researchers during the length of a grant for a technology
902     commercialization project;
903          (e) providing internship opportunities during the length of a grant directly related to a
904     technology commercialization project; and
905          (f) other purposes that the governing authority determines are consistent with the
906     mission and responsibilities of Innovate Utah.
907          [(2)] (3) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
908     Act, the governing authority shall make rules that describe, for each grant program:
909          (a) the purpose;
910          (b) eligibility criteria to receive a grant;
911          (c) how the governing authority determines which proposals receive grants;
912          (d) reporting requirements in accordance with Part 7, Reporting by Recipients of
913     [USTAR] Innovate Utah Support; and
914          (e) other information the governing authority determines is necessary or appropriate.
915          [(3)] (4) The governing authority:
916          (a) shall solicit proposals for each grant program; [and]
917          (b) may, subject to legislative appropriation and Subsection 63M-2-502(1)(b), award
918     grants for each program[.]; and
919          (c) shall determine the targeted technology sectors and grant requirements in
920     consultation with the following:
921          (i) other economic development entities including the Governor's Office of Economic
922     Development;
923          (ii) industry partners, including public and private entities; and
924          (iii) university partners.
925          [(4)] (5) In evaluating a grant proposal received in response to a solicitation under this
926     section, the governing authority shall consider, as applicable:

927          (a) the extent to which the planned research has the potential for commercialization;
928          (b) the market gap the technology or research fills; and
929          (c) other factors the governing authority determines are relevant, important, or
930     necessary.
931          [(5)] (6) The governing authority shall require a recipient of a grant under this section,
932     as a condition of receiving a grant, to comply with the reporting requirements described in[:
933     (a) Section 63M-2-702, for a USTAR researcher; or (b)] Section 63M-2-703, for a private
934     entity or for a partnership between a [USTAR] Innovate Utah researcher and a private entity.
935          Section 20. Section 63M-2-504 is amended to read:
936          63M-2-504. Other Innovate Utah support.
937          (1) The governing authority shall:
938          (a) provide mentoring, networking, and entrepreneurial training for a private entity or
939     [USTAR] Innovate Utah researcher to help take a new technology to market;
940          (b) provide support to a private entity or [USTAR] Innovate Utah researcher in
941     assessing the potential for bringing a technology to market; and
942          (c) encourage industry partnerships between a private entity and [a USTAR] an
943     Innovate Utah researcher.
944          (2) The governing authority shall require a recipient of [USTAR] Innovate Utah
945     support under this section, as a condition of receiving [USTAR] Innovate Utah support, to
946     comply with the reporting requirements in[: (a) Section 63M-2-702, for a USTAR researcher;
947     or (b)] Section 63M-2-703, for a private entity or for a partnership between [a USTAR] an
948     Innovate Utah researcher and a private entity.
949          Section 21. Section 63M-2-602 is amended to read:
950          63M-2-602. Lease agreement for a research building -- Requirements for lease
951     agreement.
952          (1) Subject to Subsection (3), the governing authority shall enter into a written lease
953     agreement with a research university to lease to the research university a research building
954     constructed on the research university's campus.
955          (2) A lease agreement under Subsection (1) shall:
956          (a) require the research university to pay the ongoing operation and maintenance
957     expenses associated with the research building, including for any infrastructure in the research

958     building; and
959          (b) [subject to the reporting requirements described in Section 63M-2-705,] permit the
960     research university to use or rent space within the research building for research other than
961     research receiving [USTAR] Innovate Utah support, including research by a private entity.
962          (3) (a) On or before October 1, 2018, the governing authority shall transfer ownership
963     and title of the:
964          (i) research building known as the James L. Sorenson Molecular Biotechnology
965     Building, USTAR Building, located at 36 South Wasatch Drive, Salt Lake City, to the
966     University of Utah; and
967          (ii) research building known as the USTAR BioInnovations Center located at 650 East
968     1600 North, North Logan, to Utah State University.
969          (b) The provisions of Subsections (1) and (2) are no longer in effect after the transfer of
970     ownership described in this Subsection (3) occurs.
971          Section 22. Section 63M-2-701 is amended to read:
972     
Part 7. Reporting by Recipients of Innovate Utah Support

973          63M-2-701. Title.
974          This part is known as "Reporting by Recipients of [USTAR] Innovate Utah Support."
975          Section 23. Section 63M-2-703 is amended to read:
976          63M-2-703. Reporting requirements for private entities.
977          (1) On or before September 1 of each year, the governing authority shall collect the
978     information described in Subsection (2) from each private entity that:
979          (a) receives [USTAR] Innovate Utah support;
980          (b) receives more than 20 hours of training from [USTAR] Innovate Utah;
981          (c) purchases a private entity that previously received [USTAR] Innovate Utah support;
982     or
983          (d) licenses a technology developed by [a USTAR] an Innovate Utah researcher.
984          (2) The governing authority shall collect information on:
985          (a) public or private investment received by the private entity after the private entity:
986          (i) begins to receive [USTAR] Innovate Utah support;
987          (ii) licenses a technology from [a USTAR] an Innovate Utah researcher; or
988          (iii) purchases a private entity that previously received [USTAR] Innovate Utah

989     support;
990          (b) sales or revenue generated by the product or technology;
991          (c) the number of jobs created by the private entity and the average wage for each
992     position; and
993          (d) the location of the private entity.
994          (3) (a) To collect the information described in Subsection (2), the governing authority
995     shall, in accordance with Title 63G, Chapter 6a, Utah Procurement Code, contract with an
996     independent third party to conduct a survey of each private entity described in Subsection (1).
997          (b) The independent third party selected under Subsection (3)(a) shall use industry
998     standard practices to collect the information described in Subsection (2).
999          (4) The governing authority and Department of Workforce Services shall coordinate to
1000     verify the job and average wage information described in Subsection (2)(c).
1001          Section 24. Section 63M-2-801 is amended to read:
1002     
Part 8. Innovate Utah Reporting and Audit Requirements

1003          63M-2-801. Title.
1004          This part is known as ["USTAR] "Innovate Utah Reporting and Audit Requirements."
1005          Section 25. Section 63M-2-802 is amended to read:
1006          63M-2-802. Innovate Utah annual report.
1007          (1) (a) On or before October 1 of each year, the governing authority shall submit, in
1008     accordance with Section 68-3-14, an annual written report for the preceding fiscal year to:
1009          (i) the Business, Economic Development, and Labor Appropriations Subcommittee;
1010          (ii) the Economic Development and Workforce Services Interim Committee;
1011          (iii) the Business and Labor Interim Committee; and
1012          (iv) the governor.
1013          (b) An annual report under Subsection (1)(a) is subject to modification as provided in
1014     Subsection (5) after an audit described in Section 63M-2-803 is released.
1015          (2) An annual report described in Subsection (1) shall include:
1016          (a) information reported to the governing authority through the survey described in
1017     Section 63M-2-703;
1018          (b) a clear description of the methodology used to arrive at any information in the
1019     report that is based on an estimate;

1020          (c) starting with fiscal year 2017 data as a baseline, data from previous years for
1021     comparison with the annual data reported under this Subsection (2);
1022          (d) relevant federal and state statutory references and requirements;
1023          (e) contact information for the executive director;
1024          (f) other information determined by the governing authority that promotes
1025     accountability and transparency; and
1026          (g) the written economic development objectives required under Subsection
1027     63M-2-302(1)(e) and a description of progress or challenges in meeting the objectives.
1028          (3) The governing authority shall design the annual report to provide clear, accurate,
1029     and accessible information to the public, the governor, and the Legislature.
1030          (4) The governing authority shall:
1031          (a) submit the annual report in accordance with Section 68-3-14; and
1032          (b) place a link to the annual report and previous annual reports on USTAR's website.
1033          (5) Following the completion of an annual audit described in Section 63M-2-803, the
1034     governing authority shall:
1035          (a) publicly issue a revised annual report that:
1036          (i) addresses the audit;
1037          (ii) responds to audit findings; and
1038          (iii) incorporates any revisions to the annual report based on audit findings;
1039          (b) publish the revised annual report on USTAR's website, with a link to the audit; and
1040          (c) submit, in accordance with Section 68-3-14, written notification of any revisions of
1041     the annual report to:
1042          (i) the Business, Economic Development, and Labor Appropriations Subcommittee;
1043          (ii) the Economic Development and Workforce Services Interim Committee;
1044          (iii) the Business and Labor Interim Committee; and
1045          (iv) the governor.
1046          (6) In addition to the annual written report described in this section, the governing
1047     authority shall:
1048          (a) provide information and progress reports to a legislative committee upon request;
1049     [and]
1050          (b) on or before August 1, 2018, and every five years after August 1, 2018, provide to

1051     the same entities that receive the annual report described in Subsection (1)(a) a written analysis
1052     and recommendations concerning the usefulness of the information required in the annual
1053     report and [USTAR's] Innovate Utah's ongoing effectiveness, including whether:
1054          (i) the reporting requirements are effective at measuring [USTAR's] Innovate Utah's
1055     performance;
1056          (ii) the reporting requirements should be modified;
1057          (iii) [USTAR] Innovate Utah is beneficial to the state and should continue; and
1058          (iv) [whether] programs in other agencies could provide similar benefits to the state
1059     more effectively or at a lower cost[.]; and
1060          (c) on or before August 1, 2019, provide to the same entities that receive the annual
1061     report described in Subsection (1)(a), a written analysis and recommendations concerning the
1062     following:
1063          (i) options for converting grants awarded under Section 63M-2-503 to a revenue or
1064     investment model, including changes that would allow for the grant program to be converted to
1065     a procurement process after the first five years of a grant;
1066          (ii) options for managing existing incubation facilities, including the current model,
1067     other cost sharing related models, or a procurement process for facility management; and
1068          (iii) an audit of technology supported through the grant program established under
1069     Section 63M-2-503 and other Innovate Utah funding provided to the University of Utah and
1070     Utah State University, including the current status of each technology.
1071          Section 26. Section 63M-2-803 is amended to read:
1072          63M-2-803. Audit requirements.
1073          (1) Every third year beginning 2018, an audit of [USTAR] Innovate Utah shall be made
1074     as described in this section.
1075          (2) (a) As approved by the Legislative Audit Subcommittee, the audit shall be
1076     conducted by:
1077          (i) the legislative auditor; or
1078          (ii) an independent auditor engaged by the legislative auditor.
1079          (b) An independent auditor used under Subsection (2)(a)(ii) may not have a direct
1080     financial conflict of interest with [USTAR] Innovate Utah or the governing authority.
1081          (3) The governing authority shall pay the costs associated with the annual audit.

1082          (4) The annual audit shall:
1083          (a) include a verification of the accuracy of the information required to be included in
1084     the annual report described in Section 63M-2-802; and
1085          (b) be completed by December 1 of the year the report is required under Subsection (1).
1086          Section 27. Section 63N-1-501 is amended to read:
1087          63N-1-501. Governor's Economic Development Coordinating Council --
1088     Membership -- Expenses.
1089          (1) There is created in the office the Governor's Economic Development Coordinating
1090     Council, consisting of the following 11 members:
1091          (a) the executive director, who shall serve as chair of the council;
1092          (b) the chair of the board or the chair's designee;
1093          (c) the chair of the [Utah Science Technology and Research] Innovate Utah Governing
1094     Authority created in Section 63M-2-301 or the chair's designee;
1095          (d) the chair of the Governor's Rural Partnership Board created in Section 63C-10-102
1096     or the chair's designee;
1097          (e) the chair of the board of directors of the Utah Capital Investment Corporation
1098     created in Section 63N-6-301 or the chair's designee;
1099          (f) the chair of the Economic Development Corporation of Utah or its successor
1100     organization or the chair's designee;
1101          (g) the chair of the World Trade Center Utah or its successor organization or the chair's
1102     designee; and
1103          (h) four members appointed by the governor, with the consent of the Senate, who have
1104     expertise in business, economic development, entrepreneurship, or the raising of venture or
1105     seed capital for research and business growth.
1106          (2) (a) The four members appointed by the governor may serve for no more than two
1107     consecutive two-year terms.
1108          (b) The governor shall appoint a replacement if a vacancy occurs from the membership
1109     appointed under Subsection (1)(h).
1110          (3) Six members of the council constitute a quorum for the purpose of conducting
1111     council business and the action of a majority of a quorum constitutes the action of the council.
1112          (4) A member may not receive compensation or benefits for the member's service on

1113     the council, but may receive per diem and travel expenses in accordance with:
1114          (a) Sections 63A-3-106 and 63A-3-107; and
1115          (b) rules made by the Division of Finance under Sections 63A-3-106 and 63A-3-107.
1116          (5) The office shall provide office space and administrative staff support for the
1117     council.
1118          (6) The council, as a governmental entity, has all the rights, privileges, and immunities
1119     of a governmental entity of the state and its meetings are subject to Title 52, Chapter 4, Open
1120     and Public Meetings Act.
1121          Section 28. Section 63N-3-204 is amended to read:
1122          63N-3-204. Administration -- Grants and loans.
1123          (1) The office shall administer this part.
1124          (2) (a) (i) The office may award Technology Commercialization and Innovation
1125     Program grants or issue loans under this part to an applicant that is:
1126          (A) an institution of higher education;
1127          (B) a licensee; or
1128          (C) a small business.
1129          (ii) If loans are issued under Subsection (2)(a)(i), the Division of Finance may set up a
1130     fund or account as necessary for the proper accounting of the loans.
1131          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1132     office shall make rules for a process to determine whether an institution of higher education
1133     that receives a grant under this part must return the grant proceeds or a portion of the grant
1134     proceeds if the technology that is developed with the grant proceeds is licensed to a licensee
1135     that:
1136          (i) does not maintain a manufacturing or service location in the state from which the
1137     licensee or a sublicensee exploits the technology; or
1138          (ii) initially maintains a manufacturing or service location in the state from which the
1139     licensee or a sublicensee exploits the technology, but within five years after issuance of the
1140     license the licensee or sublicensee transfers the manufacturing or service location for the
1141     technology to a location out of the state.
1142          (c) A repayment by an institution of higher education of grant proceeds or a portion of
1143     the grant proceeds may only come from the proceeds of the license established between the

1144     licensee and the institution of higher education.
1145          (d) (i) An applicant that is a licensee or small business that receives a grant under this
1146     part shall return the grant proceeds or a portion of the grant proceeds to the office if the
1147     applicant:
1148          (A) does not maintain a manufacturing or service location in the state from which the
1149     applicant exploits the technology; or
1150          (B) initially maintains a manufacturing or service location in the state from which the
1151     applicant exploits the technology, but within five years after issuance of the grant, the applicant
1152     transfers the manufacturing or service location for the technology to an out-of-state location.
1153          (ii) A repayment by an applicant shall be prorated based on the number of full years the
1154     applicant operated in the state from the date of the awarded grant.
1155          (iii) A repayment by a licensee that receives a grant may only come from the proceeds
1156     of the license to that licensee.
1157          (3) (a) Funding allocations shall be made by the office with the advice of the board.
1158          (b) Each proposal shall receive the best available outside review.
1159          (4) (a) In considering each proposal, the office shall weigh technical merit, the level of
1160     matching funds from private and federal sources, and the potential for job creation and
1161     economic development.
1162          (b) Proposals or consortia that combine and coordinate related research at two or more
1163     institutions of higher education shall be encouraged.
1164          (5) The office shall review the activities and progress of grant recipients on a regular
1165     basis and, as part of the office's annual written report described in Section 63N-1-301, report
1166     on the accomplishments and direction of the Technology Commercialization and Innovation
1167     Program.
1168          (6) (a) On or before August 1, 2018, the office shall provide a written analysis and
1169     recommendations concerning the usefulness of the Technology Commercialization and
1170     Innovation Program described in this part, including whether:
1171          (i) the program is beneficial to the state and should continue; and
1172          (ii) other office programs or programs in other agencies could provide similar benefits
1173     to the state more effectively or at a lower cost.
1174          (b) The written analysis and recommendations described in this Subsection (6) shall be

1175     provided to:
1176          (i) the Business, Economic Development, and Labor Appropriations Subcommittee;
1177          (ii) the Economic Development and Workforce Services Interim Committee;
1178          (iii) the Business and Labor Interim Committee; and
1179          (iv) the governor.
1180          (7) Beginning May 14, 2019, the office may not enter into, extend, or renew any grant
1181     commitments or agreements or issue new loans under this part.
1182          Section 29. Section 63N-3-305 is amended to read:
1183          63N-3-305. Duties and responsibilities of a business resource center.
1184          (1) A business resource center shall:
1185          (a) have a director;
1186          (b) be the organization responsible for identifying, tracking, coordinating, and
1187     measuring output of assisted business clients in its region;
1188          (c) develop programs to aid business clients in finding needed resources;
1189          (d) recruit state-funded agencies to locate and establish their programs in the business
1190     center's region;
1191          (e) initiate and encourage business education programs, including programs in
1192     collaboration with public, private, and governmental and educational institutions; and
1193          (f) work with the host institution in providing academic resources, including faculty
1194     and student assistance.
1195          (2) A business resource center shall collaborate with the host institution and state
1196     agencies to:
1197          (a) provide research, development, or training programs for new or existing businesses,
1198     industries, or high technology business located in its region;
1199          (b) assist in providing needs assessment relating to new or existing businesses,
1200     industries, or high technology business in conjunction with other public or private economic
1201     development programs or initiatives;
1202          (c) assist in providing business incubator space or services, or both, if considered
1203     feasible and practical, to clients based on criteria established by the office;
1204          (d) work with local business leaders and government officials to help them formulate
1205     and implement sound, coordinated, and measurable economic development programs for their

1206     communities; [and]
1207          (e) work with local government and other entities in its region in developing and
1208     certifying non-state funded satellite business resource centers[.]; and
1209          (f) provide services to facilitate relationships between business clients and private risk
1210     capital investors.
1211          Section 30. Section 67-19-15 is amended to read:
1212          67-19-15. Career service -- Exempt positions -- Schedules for civil service
1213     positions -- Coverage of career service provisions.
1214          (1) Except as otherwise provided by law or by rules and regulations established for
1215     federally aided programs, the following positions are exempt from the career service provisions
1216     of this chapter and are designated under the following schedules:
1217          (a) schedule AA includes the governor, members of the Legislature, and all other
1218     elected state officers;
1219          (b) schedule AB includes appointed executives and board or commission executives
1220     enumerated in Section 67-22-2;
1221          (c) schedule AC includes all employees and officers in:
1222          (i) the office and at the residence of the governor;
1223          (ii) [the Utah Science Technology and Research Initiative (USTAR)] Innovate Utah;
1224          (iii) the Public Lands Policy Coordinating Council;
1225          (iv) the Office of the State Auditor; and
1226          (v) the Office of the State Treasurer;
1227          (d) schedule AD includes employees who:
1228          (i) are in a confidential relationship to an agency head or commissioner; and
1229          (ii) report directly to, and are supervised by, a department head, commissioner, or
1230     deputy director of an agency or its equivalent;
1231          (e) schedule AE includes each employee of the State Board of Education that the State
1232     Board of Education designates as exempt from the career service provisions of this chapter;
1233          (f) schedule AG includes employees in the Office of the Attorney General who are
1234     under their own career service pay plan under Sections 67-5-7 through 67-5-13;
1235          (g) schedule AH includes:
1236          (i) teaching staff of all state institutions; and

1237          (ii) employees of the Utah Schools for the Deaf and the Blind who are:
1238          (A) educational interpreters as classified by the department; or
1239          (B) educators as defined by Section 53E-8-102;
1240          (h) schedule AN includes employees of the Legislature;
1241          (i) schedule AO includes employees of the judiciary;
1242          (j) schedule AP includes all judges in the judiciary;
1243          (k) schedule AQ includes:
1244          (i) members of state and local boards and councils appointed by the governor and
1245     governing bodies of agencies;
1246          (ii) a water commissioner appointed under Section 73-5-1;
1247          (iii) other local officials serving in an ex officio capacity; and
1248          (iv) officers, faculty, and other employees of state universities and other state
1249     institutions of higher education;
1250          (l) schedule AR includes employees in positions that involve responsibility:
1251          (i) for determining policy;
1252          (ii) for determining the way in which a policy is carried out; or
1253          (iii) of a type not appropriate for career service, as determined by the agency head with
1254     the concurrence of the executive director;
1255          (m) schedule AS includes any other employee:
1256          (i) whose appointment is required by statute to be career service exempt;
1257          (ii) whose agency is not subject to this chapter; or
1258          (iii) whose agency has authority to make rules regarding the performance,
1259     compensation, and bonuses for its employees;
1260          (n) schedule AT includes employees of the Department of Technology Services,
1261     designated as executive/professional positions by the executive director of the Department of
1262     Technology Services with the concurrence of the executive director;
1263          (o) schedule AU includes patients and inmates employed in state institutions;
1264          (p) employees of the Department of Workforce Services, designated as schedule AW:
1265          (i) who are temporary employees that are federally funded and are required to work
1266     under federally qualified merit principles as certified by the director; or
1267          (ii) for whom substantially all of their work is repetitive, measurable, or transaction

1268     based, and who voluntarily apply for and are accepted by the Department of Workforce
1269     Services to work in a pay for performance program designed by the Department of Workforce
1270     Services with the concurrence of the executive director; and
1271          (q) for employees in positions that are temporary, seasonal, time limited, funding
1272     limited, or variable hour in nature, under schedule codes and parameters established by the
1273     department by administrative rule.
1274          (2) The civil service shall consist of two schedules as follows:
1275          (a) (i) Schedule A is the schedule consisting of positions under Subsection (1).
1276          (ii) Removal from any appointive position under schedule A, unless otherwise
1277     regulated by statute, is at the pleasure of the appointing officers without regard to tenure.
1278          (b) Schedule B is the competitive career service schedule, consisting of:
1279          (i) all positions filled through competitive selection procedures as defined by the
1280     executive director; or
1281          (ii) positions filled through a department approved on-the-job examination intended to
1282     appoint a qualified person with a disability, or a veteran in accordance with Title 71, Chapter
1283     10, Veterans Preference.
1284          (3) (a) The executive director, after consultation with the heads of concerned executive
1285     branch departments and agencies and with the approval of the governor, shall allocate positions
1286     to the appropriate schedules under this section.
1287          (b) Agency heads shall make requests and obtain approval from the executive director
1288     before changing the schedule assignment and tenure rights of any position.
1289          (c) Unless the executive director's decision is reversed by the governor, when the
1290     executive director denies an agency's request, the executive director's decision is final.
1291          (4) (a) Compensation for employees of the Legislature shall be established by the
1292     directors of the legislative offices in accordance with Section 36-12-7.
1293          (b) Compensation for employees of the judiciary shall be established by the state court
1294     administrator in accordance with Section 78A-2-107.
1295          (c) Compensation for officers, faculty, and other employees of state universities and
1296     institutions of higher education shall be established as provided in Title 53B, Chapter 1,
1297     Governance, Powers, Rights, and Responsibilities, and Title 53B, Chapter 2, Institutions of
1298     Higher Education.

1299          (d) Unless otherwise provided by law, compensation for all other schedule A
1300     employees shall be established by their appointing authorities, within ranges approved by, and
1301     after consultation with the executive director of the Department of Human Resource
1302     Management.
1303          (5) An employee who is in a position designated schedule AC and who holds career
1304     service status on June 30, 2010, shall retain the career service status if the employee:
1305          (a) remains in the position that the employee is in on June 30, 2010; and
1306          (b) does not elect to convert to career service exempt status in accordance with a rule
1307     made by the department.
1308          Section 31. Section 67-22-2 is amended to read:
1309          67-22-2. Compensation -- Other state officers.
1310          (1) As used in this section:
1311          (a) "Appointed executive" means the:
1312          (i) commissioner of the Department of Agriculture and Food;
1313          (ii) commissioner of the Insurance Department;
1314          (iii) commissioner of the Labor Commission;
1315          (iv) director, Department of Alcoholic Beverage Control;
1316          (v) commissioner of the Department of Financial Institutions;
1317          (vi) executive director, Department of Commerce;
1318          (vii) executive director, Commission on Criminal and Juvenile Justice;
1319          (viii) adjutant general;
1320          (ix) executive director, Department of Heritage and Arts;
1321          (x) executive director, Department of Corrections;
1322          (xi) commissioner, Department of Public Safety;
1323          (xii) executive director, Department of Natural Resources;
1324          (xiii) executive director, Governor's Office of Management and Budget;
1325          (xiv) executive director, Department of Administrative Services;
1326          (xv) executive director, Department of Human Resource Management;
1327          (xvi) executive director, Department of Environmental Quality;
1328          (xvii) director, Governor's Office of Economic Development;
1329          (xviii) executive director, [Utah Science Technology and Research Governing

1330     Authority] Innovate Utah;
1331          (xix) executive director, Department of Workforce Services;
1332          (xx) executive director, Department of Health, Nonphysician;
1333          (xxi) executive director, Department of Human Services;
1334          (xxii) executive director, Department of Transportation;
1335          (xxiii) executive director, Department of Technology Services; and
1336          (xxiv) executive director, Department of Veterans and Military Affairs.
1337          (b) "Board or commission executive" means:
1338          (i) members, Board of Pardons and Parole;
1339          (ii) chair, State Tax Commission;
1340          (iii) commissioners, State Tax Commission;
1341          (iv) executive director, State Tax Commission;
1342          (v) chair, Public Service Commission; and
1343          (vi) commissioners, Public Service Commission.
1344          (c) "Deputy" means the person who acts as the appointed executive's second in
1345     command as determined by the Department of Human Resource Management.
1346          (2) (a) The executive director of the Department of Human Resource Management
1347     shall:
1348          (i) before October 31 of each year, recommend to the governor a compensation plan for
1349     the appointed executives and the board or commission executives; and
1350          (ii) base those recommendations on market salary studies conducted by the Department
1351     of Human Resource Management.
1352          (b) (i) The Department of Human Resource Management shall determine the salary
1353     range for the appointed executives by:
1354          (A) identifying the salary range assigned to the appointed executive's deputy;
1355          (B) designating the lowest minimum salary from those deputies' salary ranges as the
1356     minimum salary for the appointed executives' salary range; and
1357          (C) designating 105% of the highest maximum salary range from those deputies' salary
1358     ranges as the maximum salary for the appointed executives' salary range.
1359          (ii) If the deputy is a medical doctor, the Department of Human Resource Management
1360     may not consider that deputy's salary range in designating the salary range for appointed

1361     executives.
1362          (c) (i) Except as provided in Subsection (2)(c)(ii), in establishing the salary ranges for
1363     board or commission executives, the Department of Human Resource Management shall set
1364     the maximum salary in the salary range for each of those positions at 90% of the salary for
1365     district judges as established in the annual appropriation act under Section 67-8-2.
1366          (ii) In establishing the salary ranges for an individual described in Subsection (1)(b)(ii)
1367     or (iii), the Department of Human Resource Management shall set the maximum salary in the
1368     salary range for each of those positions at 100% of the salary for district judges as established
1369     in the annual appropriation act under Section 67-8-2.
1370          (3) (a) (i) Except as provided in Subsection (3)(a)(ii), the governor shall establish a
1371     specific salary for each appointed executive within the range established under Subsection
1372     (2)(b).
1373          (ii) If the executive director of the Department of Health is a physician, the governor
1374     shall establish a salary within the highest physician salary range established by the Department
1375     of Human Resource Management.
1376          (iii) The governor may provide salary increases for appointed executives within the
1377     range established by Subsection (2)(b) and identified in Subsection (3)(a)(ii).
1378          (b) The governor shall apply the same overtime regulations applicable to other FLSA
1379     exempt positions.
1380          (c) The governor may develop standards and criteria for reviewing the appointed
1381     executives.
1382          (4) Salaries for other Schedule A employees, as defined in Section 67-19-15, that are
1383     not provided for in this chapter, or in Title 67, Chapter 8, Utah Elected Official and Judicial
1384     Salary Act, shall be established as provided in Section 67-19-15.
1385          (5) (a) The Legislature fixes benefits for the appointed executives and the board or
1386     commission executives as follows:
1387          (i) the option of participating in a state retirement system established by Title 49, Utah
1388     State Retirement and Insurance Benefit Act, or in a deferred compensation plan administered
1389     by the State Retirement Office in accordance with the Internal Revenue Code and its
1390     accompanying rules and regulations;
1391          (ii) health insurance;

1392          (iii) dental insurance;
1393          (iv) basic life insurance;
1394          (v) unemployment compensation;
1395          (vi) workers' compensation;
1396          (vii) required employer contribution to Social Security;
1397          (viii) long-term disability income insurance;
1398          (ix) the same additional state-paid life insurance available to other noncareer service
1399     employees;
1400          (x) the same severance pay available to other noncareer service employees;
1401          (xi) the same leave, holidays, and allowances granted to Schedule B state employees as
1402     follows:
1403          (A) sick leave;
1404          (B) converted sick leave if accrued prior to January 1, 2014;
1405          (C) educational allowances;
1406          (D) holidays; and
1407          (E) annual leave except that annual leave shall be accrued at the maximum rate
1408     provided to Schedule B state employees;
1409          (xii) the option to convert accumulated sick leave to cash or insurance benefits as
1410     provided by law or rule upon resignation or retirement according to the same criteria and
1411     procedures applied to Schedule B state employees;
1412          (xiii) the option to purchase additional life insurance at group insurance rates according
1413     to the same criteria and procedures applied to Schedule B state employees; and
1414          (xiv) professional memberships if being a member of the professional organization is a
1415     requirement of the position.
1416          (b) Each department shall pay the cost of additional state-paid life insurance for its
1417     executive director from its existing budget.
1418          (6) The Legislature fixes the following additional benefits:
1419          (a) for the executive director of the State Tax Commission a vehicle for official and
1420     personal use;
1421          (b) for the executive director of the Department of Transportation a vehicle for official
1422     and personal use;

1423          (c) for the executive director of the Department of Natural Resources a vehicle for
1424     commute and official use;
1425          (d) for the commissioner of Public Safety:
1426          (i) an accidental death insurance policy if POST certified; and
1427          (ii) a public safety vehicle for official and personal use;
1428          (e) for the executive director of the Department of Corrections:
1429          (i) an accidental death insurance policy if POST certified; and
1430          (ii) a public safety vehicle for official and personal use;
1431          (f) for the adjutant general a vehicle for official and personal use; and
1432          (g) for each member of the Board of Pardons and Parole a vehicle for commute and
1433     official use.