BWH H.B. 2179 75(R)BILL ANALYSIS


COUNTY AFFAIRS
H.B. 2179
By: Lewis, Ron
4-10-97
Committee Report (Amended)



BACKGROUND 

Under current law, a loop hole exists that allows counties to avoid
complying with competitive bidding requirements when paying for
construction or maintenance contracts out of proceeds from anticipation
notes.  Anticipation notes, like certificates of obligation, are
considered debt. They fall under many of the same requirements as bonds
and certificates of obligation.  When counties contract for construction
to be done, it is the taxpayers who bear the burden when initial cost
estimates are exceeded.  Often, the additional costs are undeterminable
due to the fact that the county uses its own employees and the time and
money that county employees spend on such projects is not recorded.
Closing the loop hole in the law and requiring counties to comply with
competitive bidding when using anticipation notes and limiting work by the
day will help to keep costs to a minimum and keep county residents
informed.  

PURPOSE

The purpose of this bill is to require counties to comply with the
competitive bidding requirements in Chapter271 of the Local Government
Code, even when financing projects through anticipation notes. 

RULEMAKING AUTHORITY

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

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 262.023(b), Local Government Code by making
anticipation notes subject to the same competitive bidding requirements as
certificates of obligation. 

SECTION 2.  Adds a new Subsection 262.024(e), which states that the
Section exempting work performed by the day from the competitive bidding
requirements applies only to counties with populations of 100,000 or less. 

SECTION 3.  Amends Section 6, Article 717w, Revised Statutes by adding a
new Subsection (h), which requires counties to comply with the competitive
bidding requirements in the Local Government Code when a contract is to be
paid out of proceeds from anticipation notes. 

SECTION 4.  Effective date.

SECTION 5.  Applicability of Act only to contracts entered and
anticipation notes authorized after effective date. 

SECTION 6.  Emergency clause.

EXPLANATION OF AMENDMENTS

Committee Amendment No. 1 limits the term for which day labor may be hired
to 20 days every 3 months.