Enrolled Bill Summary

            House Bill 2493 amends provisions of the Local Government Code relating to consideration of location of a bidder's principal place of business in awarding certain municipal and school district contracts. The bill revises the definition of local government in this section to include a municipality with a population of 225,000 or less, rather than 200,000 or less, and to remove the provision that previously excluded a school district. The bill increases from three percent to five percent the allowable difference between a local business's bid and the lowest bid from a non-local business, within which range the local government may contract with either bidder.

            House Bill 2493 amends the Education Code to allow a school district awarding a contract using certain methods to consider a bidder's or offeror's principal place of business in accordance with the Local Government Code.

                Reason Given for Veto: "In 1999, the Legislature allowed certain local governments to avoid purchasing goods from the lowest bidder and instead to buy from a local business which came within three percent of the best bid. Current law applies to municipalities with populations of 200,000 or less that wish to buy real property or goods from a seller whose principal place of business is in the municipality.

                "Now, just two sessions later, House Bill No. 2493 would greatly expand the formerly limited exception. This bill would allow the local government to use the exception for services rather than just goods, increase the size of governments which could circumvent the lowest bid, further erode taxpayer protection by allowing local governments to purchase from a local bidder whose bid is five percent higher than the best bid and would extend the exception to school districts at a time when expenditures for schools are already straining local property taxpayers' ability to pay.

                "With this veto message, I hope to discourage legislators from further attempts to bypass competitive bid requirements."