Enrolled Bill Summary

            Senate Bill 178 amends the Government Code to require that litigation or settlement recoveries by state executive branch agencies and institutions of higher education be deposited in the state treasury. It prohibits payment of contingency fees and expenses for contracted legal services unless payment is appropriated by the legislature or is approved by the Legislative Budget Board if the legislature is not in session. The act sets requirements for contingent fee contracts for legal services. Contracts must be approved by an entity's governing body or elected or appointed officer, or in certain circumstances by the governor. The budget board must be notified of proposed contracts for which estimated recovery amounts exceed $100,000 and must concur in certain related findings regarding insufficiency of appropriated funds. A contract must establish hourly rates for performed legal work, which may not exceed $1,000 an hour, and must require the contracting attorney or law firm to keep time and expense records. Those records, with certain exceptions, are open to the public. A contract base fee equals the number of hours times the applicable hourly rates. The contingent fee is the product of the base fee and a multiplier, the latter established contractually based on certain risk factors and inherent complications. The multiplier may not exceed a value of four without prior legislative approval. The contract must provide for contingent fee computation, limit that fee to a specified percentage of the recovery amount, and explain how the fee computation method varies, if at all, for cases that are settled, tried, or tried and appealed. The percentage limitation may not exceed 35 percent without prior legislative approval.

            The act amends various codes to incorporate, with certain substantive changes, state government policies formerly covered by General Appropriations Act riders and relating to purchasing and contracting, including those involving historically underutilized businesses (HUBs), and to accounting matters, audit plans, office space limitations, technology coordination, telephone and telecommunications systems, public lands and public property management, certain reporting requirements, periodic rule review, and other miscellaneous topics. Additional HUB provisions concern HUB size limitations, state and local HUB certification collaboration, and General Services Commission efforts to increase HUB contracting and subcontracting, including orientation packages, mentor-protege programs, and HUB presentations before state agency forums. Agencies with a budget exceeding $10 million must appoint HUB coordinators. An agency entering into a contract with an expected value of $100,000 or more must evaluate subcontracting opportunities and, if they exist, must require that bids, proposals, or offers include a HUB subcontracting plan. The agency must evaluate the contractor's good faith compliance with the plan and in appropriate cases may bar a contractor from future contract opportunities. The General Services Commission must report annually to the governor and legislative presiding officers on its HUB education and outreach activities, and agencies in their legislative appropriations request must include a detailed report on their compliance with HUB laws and commission rules, and reasons for any noncompliance. The extent of such compliance is considered a performance measure for purposes of the appropriations process.