BILL ANALYSIS



H.B. 1178
By: Thompson
03-15-95
Committee Report (Unamended)


BACKGROUND

Cities in Texas are currently required to use the formal
competitive sealed bid process when purchasing the multitude of
various insurance coverages. Experience with the require sealed bid
process leads to the conclusion that cities can better serve the
interest of taxpayers by using sealed competitive proposals. Risk
management and insurance consultants have advised that it is very
difficult to develop specifications for the various coverages that
adequately contemplate the ever changing insurance markets. With
the ability to negotiate the fine points of items such as coverage
limits, deductibles, and exclusions, cities could acquire the best
coverage at the best price. Also, it is important to note that
Texas counties are authorized by current law to use sealed
competitive proposals to acquire insurance coverage.


PURPOSE

This bill would give cities the authority to purchase insurance
coverage using the competitive sealed bidding or competitive sealed
proposal process for insurance purchases of $15,000.


RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not grant any
additional rulemaking authority to a state officer, institution, or
agency.

SECTION BY SECTION ANALYSIS

Section 1:  Amends Section 252.021, Local Government Code, to
delete separate provisions for the purchase of insurance providing
that insurance purchases of $15,000 must comply with current state
law regarding competitive sealed bidding or competitive sealed
proposals. Adds insurance to the list of procurements for which
requests for proposals may be used.


Section 2:  Amends the heading of Section 252.042, Local Government
Code, to conform with changes in Section 1 of this bill.


Section 3:  Emergency Clause.


SUMMARY OF COMMITTEE ACTION

H.B. 1178 was considered by the committee in a public hearing on
March 13, 1995.  The following people testified in favor of the
bill: Rep. Thompson; Joe Weikerth, representing the City of
Houston; and Susan Horton, representing the Texas Municipal League. 
The following person testified against the bill: George Greanias,
representing himself.  The bill was reported favorably with the
recommendation that it do pass and be printed, by a record vote of
6 ayes, 2 nays, 0 pnv, and 1 absent.