75R14483 JRD-F                          

         By Ratliff                                             S.B. No. 583

         Substitute the following for S.B. No. 583:

         By Culberson                                       C.S.S.B. No. 583

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the construction or repair of facilities by school

 1-3     districts and institutions of higher education.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Sections 44.031(a), (b), (e), and (g), Education

 1-6     Code, are amended to read as follows:

 1-7           (a)  Except as provided by this subchapter [section], all

 1-8     school district contracts, except contracts for the purchase of

 1-9     produce or vehicle fuel, valued at $25,000 or more in the aggregate

1-10     for each 12-month period shall be made by the method, of the

1-11     following methods, that provides the best value to the district:

1-12                 (1)  competitive bidding;

1-13                 (2)  competitive sealed proposals;

1-14                 (3)  a request for proposals;

1-15                 (4)  a catalogue purchase as provided by Subchapter B,

1-16     Chapter 2157, Government Code;

1-17                 (5)  an interlocal contract; [or]

1-18                 (6)  a design/build contract;

1-19                 (7)  contracts to construct, rehabilitate, alter, or

1-20     repair facilities that involve using a construction manager; or

1-21                 (8)  a job order contract for the minor repair,

1-22     rehabilitation, or alteration of a facility.

1-23           (b)  Except as provided by this subchapter, in [In]

1-24     determining to whom to award a contract, the district may consider:

 2-1                 (1)  the purchase price;

 2-2                 (2)  the reputation of the vendor and of the vendor's

 2-3     goods or services;

 2-4                 (3)  the quality of the vendor's goods or services;

 2-5                 (4)  the extent to which the goods or services meet the

 2-6     district's needs;

 2-7                 (5)  the vendor's past relationship with the district;

 2-8                 (6)  the impact on the ability of the district to

 2-9     comply with laws and rules relating to historically underutilized

2-10     businesses;

2-11                 (7)  the total long-term cost to the district to

2-12     acquire the vendor's goods or services; and

2-13                 (8)  any other relevant factor that a private business

2-14     entity would consider in selecting a vendor.

2-15           (e)  To the extent of any conflict, this subchapter [section]

2-16     prevails over any other law relating to the purchasing of goods and

2-17     services except a law relating to contracting with historically

2-18     underutilized businesses.

2-19           (g)  Notice of the time by when and place where the bids or

2-20     proposals, or the responses to a request for qualifications, will

2-21     be received shall be published in the county in which the

2-22     district's central administrative office is located, once a week

2-23     for at least two weeks before the deadline for receiving bids,

2-24     proposals, or responses to a request for qualifications; [date set

2-25     for awarding the contract,] except that on contracts involving less

2-26     than $25,000, the advertising may be limited to two successive

2-27     issues of any newspaper published in the county in which the

 3-1     district's central administrative office is located, and if there

 3-2     is not a newspaper in that county, the advertising shall be

 3-3     published in a newspaper in the county nearest the county seat of

 3-4     the county in which the district's central administrative office is

 3-5     located.

 3-6           SECTION 2.  Subchapter B, Chapter 44, Education Code, is

 3-7     amended by adding Sections 44.0315 and 44.035-44.041 to read as

 3-8     follows:

 3-9           Sec. 44.0315.  DEFINITIONS.  In this subchapter:

3-10                 (1)  "Architect" means an individual registered as an

3-11     architect under Chapter 478, Acts of the 45th Legislature, Regular

3-12     Session, 1937 (Article 249a, Vernon's Texas Civil Statutes).

3-13                 (2)  "Contractor" in the context of a contract for the

3-14     construction, rehabilitation, alteration, or repair of a facility

3-15     means a sole proprietorship, partnership, corporation, or other

3-16     legal entity that assumes the risk for constructing,

3-17     rehabilitating, altering, or repairing all or part of the facility

3-18     at the contracted price.

3-19                 (3)  "Engineer" means an individual registered as a

3-20     professional engineer under The Texas Engineering Practice Act

3-21     (Article 3271a, Vernon's Texas Civil Statutes).

3-22                 (4)  "Facility" means real property, including

3-23     buildings and associated structures and improved or unimproved

3-24     land.

3-25                 (5)  "Fee" in the context of a contract for the

3-26     construction, rehabilitation, alteration, or repair of a facility

3-27     means the payment a construction manager receives for its overhead

 4-1     and profit in performing its services.

 4-2                 (6)  "General conditions" in the context of a contract

 4-3     for the construction, rehabilitation, alteration, or repair of a

 4-4     facility means on-site management, administrative personnel,

 4-5     insurance, bonds, equipment, utilities, and incidental work,

 4-6     including minor field labor and materials.

 4-7           Sec. 44.035.  COMPETITIVE SEALED PROPOSALS FOR CONSTRUCTION

 4-8     SERVICES.  (a)  Except as otherwise provided by this subchapter, a

 4-9     school district using competitive sealed proposals to select a

4-10     contractor for construction services, to select a construction

4-11     manager, or to award a job order contract for construction services

4-12     shall base its selection or award on a combination of price and

4-13     other factors that the district determines provides the best value

4-14     to the district.

4-15           (b)  A school district using competitive sealed proposals

4-16     may discuss proposals with offerors after proposals have been

4-17     opened to allow for clarification and changes. The district shall

4-18     take adequate precautions to ensure that information from competing

4-19     proposals is not disclosed to other offerors.

4-20           Sec. 44.036.  DESIGN-BUILD CONTRACTS FOR FACILITIES.  (a)  In

4-21     this section:

4-22                 (1)  "Design-build contract" means a single contract

4-23     with a design-build firm for the design and construction of a

4-24     facility.

4-25                 (2)  "Design-build firm" means a partnership,

4-26     corporation, or other legal entity or team that includes an

4-27     engineer or architect and builder qualified to engage in building

 5-1     construction in Texas.

 5-2                 (3)  "Design criteria package" means a set of documents

 5-3     that provides sufficient information to permit a design-build firm

 5-4     to prepare a response to a school district's request for proposals.

 5-5     The design criteria package must specify criteria the district

 5-6     considers necessary to describe the project and may include, as

 5-7     appropriate, the legal description of the site, survey information

 5-8     concerning the site, interior space requirements, special material

 5-9     requirements, material quality standards, conceptual criteria for

5-10     the project, special equipment requirements, cost or budget

5-11     estimates, time schedules, quality assurance and quality control

5-12     requirements, site development requirements, applicable codes and

5-13     ordinances, provisions for utilities, parking requirements, or any

5-14     other requirement, as applicable.

5-15           (b)  A school district may use the design-build method for

5-16     the construction, rehabilitation, alteration, or repair of a

5-17     facility.  In using that method and in entering into a contract for

5-18     the services of a design-build firm, the contracting school

5-19     district and the design-build firm shall follow the procedures

5-20     provided by Subsections (c)-(j).

5-21           (c)  The district may designate an engineer or architect to

5-22     act as its representative.  If the district's engineer or architect

5-23     is not a full-time employee of the district, any engineer or

5-24     architect designated shall be selected on the basis of demonstrated

5-25     competence and qualifications in accordance with Subchapter A,

5-26     Chapter 2254, Government Code.

5-27           (d)  The district shall prepare a request for qualifications

 6-1     that includes general information on the project site, project

 6-2     scope, budget, special systems, selection criteria, and other

 6-3     information that may assist potential design-build firms in

 6-4     submitting proposals for the project.  The district shall also

 6-5     prepare the design criteria package that includes more detailed

 6-6     information on the project.  If the preparation of the design

 6-7     criteria package requires  engineering or architectural services

 6-8     that constitute the practice of engineering within the meaning of

 6-9     The Texas Engineering Practice Act (Article 3271a, Vernon's Texas

6-10     Civil Statutes) or the practice of architecture within the meaning

6-11     of Chapter 478, Acts of the 45th Legislature, Regular Session, 1937

6-12     (Article 249a, Vernon's Texas Civil Statutes), those services shall

6-13     be provided in accordance with the applicable law.

6-14           (e)  The district shall evaluate proposals and select a

6-15     design-build firm in two phases:

6-16                 (1)  In phase one, the district shall evaluate each

6-17     offeror's experience, technical competence, and capability to

6-18     perform, the past performance of the offeror's team and members of

6-19     the team, and other appropriate factors submitted by the team or

6-20     firm in response to the request for qualifications, except that

6-21     cost-related or price-related evaluation factors are not permitted.

6-22     Each offeror must certify to the district that each engineer or

6-23     architect that is a member of its team was selected based on

6-24     demonstrated competence and qualifications.  The district shall

6-25     qualify a maximum of five potential offerors to submit additional

6-26     information regarding technical proposals, implementation, and

6-27     costing methodologies in response to a formal request for proposals

 7-1     based on the design criteria package.

 7-2                 (2)  In phase two, the district shall evaluate offerors

 7-3     on the basis of demonstrated competence and qualifications,

 7-4     considerations of the safety and long-term durability of the

 7-5     project, the feasibility of implementing the project as proposed,

 7-6     the ability of the offeror to meet schedules, costing methodology,

 7-7     or other factors as appropriate.  The district may not require

 7-8     offerors to submit detailed engineering or architectural design as

 7-9     part of the proposal.  The district shall select the design-build

7-10     firm that submits the proposal offering the best value for the

7-11     district.

7-12           (f)  Following selection of a design-build firm under

7-13     Subsection (e), that firm's engineers or architects shall complete

7-14     the design, submitting all design elements for review and

7-15     determination of scope compliance by the district's engineer or

7-16     architect before or concurrently with construction.

7-17           (g)  An engineer shall have responsibility for compliance

7-18     with the engineering design requirements and all other applicable

7-19     requirements of The Texas Engineering Practice Act (Article 3271a,

7-20     Vernon's Texas Civil Statutes).  An architect shall have

7-21     responsibility for compliance with the requirements of Chapter 478,

7-22     Acts of the 45th Legislature, Regular Session, 1937 (Article 249a,

7-23     Vernon's Texas Civil Statutes).

7-24           (h)  The district shall provide or contract for,

7-25     independently of the design-build firm, the inspection services,

7-26     the testing of construction materials engineering, and the

7-27     verification testing services necessary for acceptance of the

 8-1     facility by the district.  The district shall select those services

 8-2     for which it contracts in accordance with Section 2254.004,

 8-3     Government Code.

 8-4           (i)  The design-build firm shall supply a signed and sealed

 8-5     set of construction documents for the project to the district at

 8-6     the conclusion of construction.

 8-7           (j)  A payment or performance bond is not required for, and

 8-8     may not provide coverage for, the portion of a design-build

 8-9     contract under this section that includes design services only.

8-10           Sec. 44.037.  CONTRACTS FOR FACILITIES:  CONSTRUCTION

8-11     MANAGER-AGENT.  (a)  A school district may use the construction

8-12     manager-agent method for the construction, rehabilitation,

8-13     alteration, or repair of a facility.  In using that method and in

8-14     entering into a contract for the services of a construction

8-15     manager-agent, a district shall follow the procedures prescribed by

8-16     this section.

8-17           (b)  A construction manager-agent is a sole proprietorship,

8-18     partnership, corporation, or other legal entity that provides

8-19     consultation to the school district regarding construction,

8-20     rehabilitation, alteration, or repair of the facility.  A

8-21     construction manager-agent represents the district in a fiduciary

8-22     capacity, except that it may perform general conditions as provided

8-23     by the contract.

8-24           (c)  Before or concurrently with selecting a construction

8-25     manager-agent, the district shall select or designate an engineer

8-26     or architect who shall prepare the construction documents for the

8-27     project and who has full responsibility for complying with The

 9-1     Texas Engineering Practice Act (Article 3271a, Vernon's Texas Civil

 9-2     Statutes) or Chapter 478, Acts of the 45th Legislature, Regular

 9-3     Session, 1937 (Article 249a, Vernon's Texas Civil Statutes), as

 9-4     applicable.  If the engineer or architect is not a full-time

 9-5     employee of the district, the district shall select the engineer or

 9-6     architect on the basis of demonstrated competence and

 9-7     qualifications as provided by Section 2254.004, Government Code.

 9-8           (d)  A district shall select a construction manager-agent on

 9-9     the basis of demonstrated competence and qualifications  in the

9-10     same manner as provided for the selection of engineers or

9-11     architects under Section 2254.004, Government Code.

9-12           (e)  A district using the construction manager-agent method

9-13     shall procure, in accordance with applicable law and in any manner

9-14     authorized by this chapter, a general contractor, trade

9-15     contractors, or subcontractors who will serve as the prime

9-16     contractor for their specific portion of the work.

9-17           (f)  The district or the construction manager-agent shall

9-18     procure in accordance with Section 2254.004, Government Code, all

9-19     of the testing of construction materials engineering, the

9-20     inspection services, and the verification testing services

9-21     necessary for acceptance of the facility by the district.

9-22           Sec. 44.038.  CONTRACTS FOR FACILITIES:  CONSTRUCTION

9-23     MANAGER-AT-RISK.  (a)  A school district may use the construction

9-24     manager-at-risk method for the construction, rehabilitation,

9-25     alteration, or repair of a facility.  In using that method and in

9-26     entering into a contract for the services of a construction

9-27     manager-at-risk, a district shall follow the procedures prescribed

 10-1    by this section.

 10-2          (b)  A construction manager-at-risk is a sole proprietorship,

 10-3    partnership, corporation, or other legal entity that assumes the

 10-4    risk for construction, rehabilitation, alteration, or repair of a

 10-5    facility at the contracted price as a general contractor and

 10-6    provides consultation to the school district regarding construction

 10-7    during and after the design of the facilities.

 10-8          (c)  Before or concurrently with selecting a construction

 10-9    manager-at-risk, the district shall select or designate an engineer

10-10    or architect who shall prepare the construction documents for the

10-11    project and who has full responsibility for complying with The

10-12    Texas Engineering Practice Act (Article 3271a, Vernon's Texas Civil

10-13    Statutes) or Chapter 478, Acts of the 45th Legislature, Regular

10-14    Session, 1937 (Article 249a, Vernon's Texas Civil Statutes), as

10-15    applicable.  If the engineer or architect is not a full-time

10-16    employee of the district, the district shall select the engineer or

10-17    architect on the basis of demonstrated competence and

10-18    qualifications as provided by Section 2254.004, Government Code.

10-19          (d)  The district shall provide or contract for,

10-20    independently of the construction manager-at-risk, the inspection

10-21    services, the testing of construction materials engineering, and

10-22    the verification testing services necessary for acceptance of the

10-23    facility by the district.  The district shall select those services

10-24    for which it contracts in accordance with Section 2254.004,

10-25    Government Code.

10-26          (e)  The district shall prepare a request for competitive

10-27    sealed proposals that includes general information on the project

 11-1    site, project scope, schedule, selection criteria, estimated

 11-2    budget, the time and place for receipt of proposals, and other

 11-3    information that may assist the district in its selection of a

 11-4    construction manager-at-risk.  The district may request that

 11-5    proposals provide the construction manager's proposed fee and its

 11-6    price for fulfilling the general conditions.  The district shall

 11-7    state the selection criteria in the request for proposals. The

 11-8    selection criteria may include the offeror's experience, past

 11-9    performance, safety record, proposed personnel and methodology, and

11-10    other appropriate factors that demonstrate the capability of the

11-11    construction manager.

11-12          (f)  The district may provide for prequalifying offerors

11-13    before proposals are submitted.  Prequalification may not be a

11-14    conclusive determination that an offeror offers the best value to

11-15    the district, and a prequalified offeror may be rejected on the

11-16    basis of subsequently discovered information.  A failure to

11-17    prequalify does not bar a subsequent determination that an offeror

11-18    offers the best value to the district with respect to a given

11-19    proposal.

11-20          (g)  The district shall receive, publicly open, and read

11-21    aloud the names of the offerors and the monetary proposals, if any,

11-22    for each proposal.  Within 45 days after the date of opening the

11-23    proposals, the district shall evaluate and rank each proposal

11-24    submitted in relation to the criteria set forth in the request for

11-25    proposals.

11-26          (h)  The district shall select the offeror that offers the

11-27    best value to the district based on the published selection

 12-1    criteria and on its ranking evaluation.   If the district is unable

 12-2    to reach a contract agreement with the selected offeror, the

 12-3    district shall terminate further discussions and proceed to the

 12-4    next offeror in the order of the selection ranking until a contract

 12-5    agreement is reached or all proposals are rejected.

 12-6          (i)  A construction manager-at-risk shall publicly advertise

 12-7    and solicit either competitive bids or competitive sealed proposals

 12-8    from trade contractors or subcontractors for the performance of all

 12-9    major elements of the work other than the minor work that may be

12-10    included in the general conditions.  A construction manager-at-risk

12-11    may seek to perform portions of the work itself if the construction

12-12    manager-at-risk submits its bid or proposal for those portions of

12-13    the work in the same manner as all other trade contractors or

12-14    subcontractors and if the district determines that the construction

12-15    manager-at-risk's bid or proposal provides the best value for the

12-16    district.

12-17          (j)  The construction manager-at-risk and the district or its

12-18    representative shall receive and open all trade contractor or

12-19    subcontractor bids or proposals in a manner that does not disclose

12-20    the contents of the bid or proposal during the selection process.

12-21    All bids or proposals shall be made public within seven days after

12-22    the date of final selection.

12-23          (k)  If the construction manager-at-risk reviews, evaluates,

12-24    and recommends to the district a bid or proposal from a trade

12-25    contractor or subcontractor but the district requires another bid

12-26    or proposal to be accepted, the district shall compensate the

12-27    construction manager-at-risk by a change in price, time, or

 13-1    guaranteed maximum cost for any additional cost and risk that the

 13-2    construction manager-at-risk may incur because of the district's

 13-3    requirement that another bid or proposal be accepted.

 13-4          Sec. 44.039. SELECTING CONTRACTOR FOR CONSTRUCTION SERVICES

 13-5    THROUGH COMPETITIVE SEALED PROPOSALS.  (a) In selecting a

 13-6    contractor for construction, rehabilitation, alteration, or repair

 13-7    services for a facility through competitive sealed proposals, a

 13-8    school district shall follow the procedures prescribed by this

 13-9    section.

13-10          (b)  The district shall select or designate an engineer or

13-11    architect to prepare construction documents for the project. The

13-12    selected or designated engineer or architect has full

13-13    responsibility for complying with The Texas Engineering Practice

13-14    Act (Article 3271a, Vernon's Texas Civil Statutes) or Chapter 478,

13-15    Acts of the 45th Legislature, Regular Session, 1937 (Article 249a,

13-16    Vernon's Texas Civil Statutes), as applicable.  If the engineer or

13-17    architect is not a full-time employee of the district, the district

13-18    shall select the engineer or architect on the basis of demonstrated

13-19    competence and qualifications as provided by Section 2254.004,

13-20    Government Code.

13-21          (c)  The district shall provide or contract for,

13-22    independently of the contractor, the inspection services, the

13-23    testing of construction materials engineering, and the verification

13-24    testing services necessary for acceptance of the facility by the

13-25    district.  The district shall select those services for which it

13-26    contracts in accordance with Section 2254.004, Government Code.

13-27          (d)  The district shall prepare a request for competitive

 14-1    sealed proposals that includes construction documents, selection

 14-2    criteria, estimated budget, project scope, schedule, and other

 14-3    information that contractors may require to respond to the request.

 14-4    The district shall state the selection criteria in the request for

 14-5    proposals. The selection criteria may include the offeror's

 14-6    experience, past performance, safety record, proposed personnel and

 14-7    methodology, and other appropriate factors that demonstrate the

 14-8    capability of the contractor.

 14-9          (e)  The district may provide for prequalifying offerors

14-10    before proposals are submitted.  Prequalification may not be a

14-11    conclusive determination that an offeror offers the best value to

14-12    the district, and a prequalified  offeror may be rejected on the

14-13    basis of subsequently discovered information.  A failure to

14-14    prequalify does not bar a subsequent determination that an offeror

14-15    offers the best value to the district with respect to a given

14-16    proposal.

14-17          (f)  The district shall receive, publicly open, and read

14-18    aloud the names of the offerors and the monetary proposals, if any,

14-19    stated in each proposal.  Within 45 days after the date of opening

14-20    the proposals, the district shall evaluate and rank each proposal

14-21    submitted in relation to the published selection criteria.

14-22          (g)  The district shall select the offeror that offers the

14-23    best value to the district based on the published selection

14-24    criteria and on its ranking evaluation.  The district and its

14-25    engineer or architect may discuss with the selected offeror options

14-26    for cost reduction.  If the district is unable to reach a contract

14-27    agreement with the selected offeror, the district shall terminate

 15-1    further discussions and proceed to the next offeror in the order of

 15-2    the selection ranking until a contract agreement is reached or all

 15-3    proposals are rejected.

 15-4          (h)  In determining best value for the district, the district

 15-5    is not restricted to considering price alone, but may consider any

 15-6    other factor stated in the selection criteria.

 15-7          Sec. 44.040.  SELECTING CONTRACTOR FOR CONSTRUCTION SERVICES

 15-8    THROUGH COMPETITIVE BIDDING.  (a)  Except to the extent prohibited

 15-9    by other law and to the extent consistent with this subchapter, a

15-10    school district may use competitive bidding to select a contractor

15-11    to perform construction, rehabilitation, alteration, or repair

15-12    services for a facility.

15-13          (b)  Sections 271.021, 271.022, 271.026, 271.027(a), and

15-14    271.0275-271.030, Local Government Code, apply to a competitive

15-15    bidding process under this section.

15-16          (c)  A school district shall award a competitively bid

15-17    contract at the bid amount to the bidder offering the best value to

15-18    the district according to the selection criteria that were

15-19    established by the district.  The selection criteria may include

15-20    the factors listed in  Section 44.031(b).

15-21          Sec. 44.041.  JOB ORDER CONTRACTS FOR FACILITIES REPAIR.  (a)

15-22    A school district may award job order contracts for the minor

15-23    repair, rehabilitation, or alteration of a facility if the work is

15-24    of a recurring nature but the delivery times are indefinite and

15-25    indefinite quantities and orders are awarded substantially on the

15-26    basis of predescribed and prepriced tasks.

15-27          (b)  The school district shall advertise for, receive, and

 16-1    publicly open competitive sealed proposals for job order contracts

 16-2    based on time and material rates for various types and

 16-3    classifications of work. The rates under a job order contract shall

 16-4    be in effect for at least six months and for not longer than two

 16-5    years.

 16-6          (c)  The district may require offerors to submit additional

 16-7    information besides rates, including experience, past performance,

 16-8    and proposed personnel and methodology.

 16-9          (d)  The district may award job order contracts to one or

16-10    more contractors based on price proposals, experience, past

16-11    performance, proposed personnel and methodology, safety record, and

16-12    other appropriate factors.

16-13          (e)  An order for a job or project under the job order

16-14    contract must be signed by the district's representative and the

16-15    contractor.  The order may be a fixed price, lump-sum contract

16-16    based on a statement of work negotiated between the district or its

16-17    representative and the contractor, or the order may be a unit price

16-18    order based on estimated quantities.  The contractor shall provide

16-19    payment and performance bonds, if required by law, based on the

16-20    amount or estimated amount of any order.

16-21          SECTION 3.  Chapter 51, Education Code, is amended by adding

16-22    Subchapter S to read as follows:

16-23     SUBCHAPTER S.  CONSTRUCTION AND REPAIR OF PERMANENT IMPROVEMENTS

16-24          Sec. 51.776.  DEFINITIONS.  In this subchapter:

16-25                (1)  "Architect" means an individual registered as an

16-26    architect under Chapter 478, Acts of the 45th Legislature, Regular

16-27    Session, 1937 (Article 249a, Vernon's Texas Civil Statutes).

 17-1                (2)  "Board" means the governing body of an

 17-2    institution.

 17-3                (3)  "Contractor" in the context of a contract for the

 17-4    construction, rehabilitation, alteration, or repair of a facility

 17-5    means a sole proprietorship, partnership, corporation, or other

 17-6    legal entity that assumes the risk for constructing,

 17-7    rehabilitating, altering, or repairing all or part of the facility

 17-8    at the contracted price.

 17-9                (4)  "Engineer" means an individual registered as a

17-10    professional engineer under The Texas Engineering Practice Act

17-11    (Article 3271a, Vernon's Texas Civil Statutes).

17-12                (5)  "Facility" means real property, including

17-13    buildings and associated structures and improved or unimproved

17-14    land.

17-15                (6)  "Fee" in the context of a contract for the

17-16    construction, rehabilitation, alteration, or repair of a facility

17-17    means the payment a construction manager receives for its overhead

17-18    and profit in performing its services.

17-19                (7)  "General conditions" in the context of a contract

17-20    for the construction, rehabilitation, alteration, or repair of a

17-21    facility means on-site management, administrative personnel,

17-22    insurance, bonds, equipment, utilities, and incidental work,

17-23    including minor field labor and materials.

17-24                (8)  "Institution" means an institution of higher

17-25    education as defined by Section 61.003.

17-26          Sec. 51.777.  DELEGATION OF AUTHORITY.  A board may, as

17-27    appropriate, delegate by rule its authority under this subchapter

 18-1    to its designated representative.

 18-2          Sec. 51.778.  COMPETITIVE BIDDING ON CONTRACTS.  (a)  Except

 18-3    as otherwise provided by this subchapter, all contracts for the

 18-4    construction or erection of permanent improvements at an

 18-5    institution are void unless made after advertising for bids for the

 18-6    contracts in a manner prescribed by the institution's board,

 18-7    receiving sealed competitive bids, and awarding of the contract to

 18-8    the lowest responsible bidder by the board.

 18-9          (b)  If a contract awarded under sealed competitive bidding

18-10    is to be recommended for award to other than the lowest bidder, any

18-11    bidder making a lower bid than the recommended bid shall be

18-12    notified of the recommendation for award and shall be allowed an

18-13    opportunity before the award to present evidence to the board or

18-14    its designated representative as to the responsibility of that

18-15    bidder.

18-16          Sec. 51.779.  COMPETITIVE SEALED PROPOSALS FOR CONSTRUCTION

18-17    SERVICES.  (a)  Except as otherwise provided by this subchapter,

18-18    the board of an institution using competitive sealed proposals to

18-19    select a contractor for construction services, to select a

18-20    construction manager, or to award a job order contract for

18-21    construction services shall base its selection or award on a

18-22    combination of price and other factors that the board determines

18-23    provides the best value to the institution.

18-24          (b)  An institution using competitive sealed proposals  may

18-25    discuss proposals with offerors after proposals have been opened to

18-26    allow for clarification and changes. The institution shall take

18-27    adequate precautions to ensure that information from competing

 19-1    proposals is not disclosed to other offerors.

 19-2          Sec. 51.780.  DESIGN-BUILD CONTRACTS FOR FACILITIES.  (a)  In

 19-3    this section:

 19-4                (1)  "Design-build contract" means a single contract

 19-5    with a design-build firm for the design and construction of a

 19-6    facility.

 19-7                (2)  "Design-build firm" means a partnership,

 19-8    corporation, or other legal entity or team that includes an

 19-9    engineer or architect and builder qualified to engage in building

19-10    construction in Texas.

19-11                (3)  "Design criteria package" means a set of documents

19-12    that provides sufficient information to permit a design-build firm

19-13    to prepare a response to an institution's request for proposals.

19-14    The design criteria package must specify criteria the institution

19-15    considers necessary to describe the project and may include, as

19-16    appropriate, the legal description of the site, survey information

19-17    concerning the site, interior space requirements, special material

19-18    requirements, material quality standards, conceptual criteria for

19-19    the project, special equipment requirements, cost or budget

19-20    estimates, time schedules, quality assurance and quality control

19-21    requirements, site development requirements, applicable codes and

19-22    ordinances, provisions for utilities, parking requirements, or any

19-23    other requirement, as applicable.

19-24          (b)  An institution may use the design-build method for the

19-25    construction, rehabilitation, alteration, or repair of a facility.

19-26    In  using that method and in entering into a contract for the

19-27    services of a design-build firm,  the contracting institution and

 20-1    the design-build firm shall follow the procedures provided by

 20-2    Subsections (c)-(k).

 20-3          (c)  The board may designate an engineer or architect to act

 20-4    as its representative.  If the board's engineer or architect is not

 20-5    a full-time employee of the institution, any engineer or architect

 20-6    designated shall be selected on the basis of demonstrated

 20-7    competence and qualifications in accordance with Subchapter A,

 20-8    Chapter 2254, Government Code.

 20-9          (d)  The institution shall prepare a request for

20-10    qualifications that includes general information on the project

20-11    site, project scope, budget, special systems, selection criteria,

20-12    and other information that may assist potential design-build firms

20-13    in submitting proposals for the project.  The institution shall

20-14    also prepare the design criteria package that includes more

20-15    detailed information on the project.  If the preparation of the

20-16    design criteria package requires engineering or architectural

20-17    services that constitute the practice of engineering within the

20-18    meaning of The Texas Engineering Practice Act (Article 3271a,

20-19    Vernon's Texas Civil Statutes) or the practice of architecture

20-20    within the meaning of Chapter 478, Acts of the 45th Legislature,

20-21    Regular Session, 1937 (Article 249a, Vernon's Texas Civil

20-22    Statutes), those services shall be provided in accordance with the

20-23    applicable law.

20-24          (e)  The board or its representative shall publish the

20-25    request for qualifications in a manner prescribed by the board.

20-26          (f)  The board or its representative shall evaluate proposals

20-27    and select a design-build firm in two phases:

 21-1                (1)  In phase one, the board or its representative

 21-2    shall evaluate each offeror's experience, technical competence, and

 21-3    capability to perform, the past performance of the offeror's team

 21-4    and members of the team, and other appropriate factors submitted by

 21-5    the team or firm in response to the request for qualifications,

 21-6    except that cost-related or price-related evaluation factors are

 21-7    not permitted.  Each offeror must certify to the board that each

 21-8    engineer or architect that is a member of its team was selected

 21-9    based on demonstrated competence and qualifications.  The board or

21-10    its representative shall qualify a maximum of five potential

21-11    offerors to submit additional information regarding technical

21-12    proposals, implementation, and costing methodologies in response to

21-13    a formal request for proposals based on the design criteria

21-14    package.

21-15                (2)  In phase two, the board or its representative

21-16    shall evaluate offerors on the basis of demonstrated competence and

21-17    qualifications, considerations of the safety and long-term

21-18    durability of the project, the feasibility of implementing the

21-19    project as proposed, the ability of the offeror to meet schedules,

21-20    costing methodology, or other factors as appropriate.  The

21-21    institution may not require offerors to submit detailed engineering

21-22    or architectural design as part of the proposal.  The board shall

21-23    select the design-build firm that submits the proposal offering the

21-24    best value for the institution.

21-25          (g)  Following selection of a design-build firm under

21-26    Subsection (f), that firm's engineers or architects shall complete

21-27    the design, submitting all design elements for review and

 22-1    determination of scope compliance by the institution's engineer or

 22-2    architect before or concurrently with construction.

 22-3          (h)  An engineer shall have responsibility for compliance

 22-4    with the engineering design requirements and all other applicable

 22-5    requirements of The Texas Engineering Practice Act (Article 3271a,

 22-6    Vernon's Texas Civil Statutes).  An architect shall have

 22-7    responsibility for compliance with the requirements of Chapter 478,

 22-8    Acts of the 45th Legislature, Regular Session, 1937 (Article 249a,

 22-9    Vernon's Texas Civil Statutes).

22-10          (i)  The institution shall provide or contract for,

22-11    independently of the design-build firm, the inspection services,

22-12    the testing of construction materials engineering, and the

22-13    verification testing services necessary for acceptance of the

22-14    facility by the institution.  The institution shall select those

22-15    services for which it contracts in accordance with Section

22-16    2254.004, Government Code.

22-17          (j)  The design-build firm shall supply a signed and sealed

22-18    set of construction documents for the project to the institution at

22-19    the conclusion of construction.

22-20          (k)  A payment or performance bond is not required for, and

22-21    may not provide coverage for, the portion of a design-build

22-22    contract under this section that includes design services only.

22-23          Sec. 51.781.  CONTRACTS FOR FACILITIES:  CONSTRUCTION

22-24    MANAGER-AGENT.  (a)  An institution may use the construction

22-25    manager-agent method for the construction, rehabilitation,

22-26    alteration, or repair of a facility.  In using that method and in

22-27    entering into a contract for the services of a construction

 23-1    manager-agent, a board shall follow the procedures prescribed by

 23-2    this section.

 23-3          (b)  A construction manager-agent is a sole proprietorship,

 23-4    partnership, corporation, or other legal entity that provides

 23-5    consultation to the institution regarding construction,

 23-6    rehabilitation, alteration, or repair of the facility.  A

 23-7    construction manager-agent represents the institution in a

 23-8    fiduciary capacity, except that it may perform general conditions

 23-9    as provided by the contract.

23-10          (c)  Before or concurrently with selecting a construction

23-11    manager-agent, the board shall select or designate an engineer or

23-12    architect who shall prepare the construction documents for the

23-13    project and who has full responsibility for complying with The

23-14    Texas Engineering Practice Act (Article 3271a, Vernon's Texas Civil

23-15    Statutes) or Chapter 478, Acts of the 45th Legislature, Regular

23-16    Session, 1937 (Article 249a, Vernon's Texas Civil Statutes), as

23-17    applicable.  If the engineer or architect is not a full-time

23-18    employee of the institution, the board shall select the engineer or

23-19    architect on the basis of demonstrated competence and

23-20    qualifications as provided by Section 2254.004, Government Code.

23-21          (d)  A board shall select a construction manager-agent on the

23-22    basis of demonstrated competence and qualifications  in the same

23-23    manner as provided for the selection of engineers or architects

23-24    under Section 2254.004, Government Code.

23-25          (e)  A board using the construction manager-agent method

23-26    shall procure, in accordance with applicable law and in any manner

23-27    authorized by this chapter, a general contractor, trade

 24-1    contractors, or subcontractors who will serve as the prime

 24-2    contractor for their specific portion of the work.

 24-3          (f)  The board or the construction manager-agent shall

 24-4    procure in accordance with Section 2254.004, Government Code, all

 24-5    of the testing of construction materials engineering, the

 24-6    inspection services, and the verification testing services

 24-7    necessary for acceptance of the facility by the institution.

 24-8          Sec. 51.782.  CONTRACTS FOR FACILITIES:  CONSTRUCTION

 24-9    MANAGER-AT-RISK.  (a)  An institution may use the construction

24-10    manager-at-risk method for the construction, rehabilitation,

24-11    alteration, or repair of a facility. In using that method and in

24-12    entering into a contract for the services of a construction

24-13    manager-at-risk, a board shall follow the procedures prescribed by

24-14    this section.

24-15          (b)  A construction manager-at-risk is a sole proprietorship,

24-16    partnership, corporation, or other legal entity that assumes the

24-17    risk for construction, rehabilitation, alteration, or repair of a

24-18    facility at the contracted price as a general contractor and

24-19    provides consultation to the institution regarding construction

24-20    during and after the design of the facilities.

24-21          (c)  Before or concurrently with selecting a construction

24-22    manager-at-risk, the board shall select or designate an engineer or

24-23    architect who shall prepare the construction documents for the

24-24    project and who has full responsibility for complying with The

24-25    Texas Engineering Practice Act (Article 3271a, Vernon's Texas Civil

24-26    Statutes) or Chapter 478, Acts of the 45th Legislature, Regular

24-27    Session, 1937 (Article 249a, Vernon's Texas Civil Statutes), as

 25-1    applicable.  If the engineer or architect is not a full-time

 25-2    employee of the institution, the board shall select the engineer or

 25-3    architect on the basis of demonstrated competence and

 25-4    qualifications as provided by Section 2254.004, Government Code.

 25-5          (d)  The board shall provide or contract for, independently

 25-6    of the construction manager-at-risk, the inspection services, the

 25-7    testing of construction materials engineering, and the verification

 25-8    testing services necessary for acceptance of the facility by the

 25-9    institution.  The board shall select those services for which it

25-10    contracts in accordance with Section 2254.004, Government Code.

25-11          (e)  The board shall prepare a request for competitive sealed

25-12    proposals that includes general information on the project site,

25-13    project scope, schedule, selection criteria, estimated budget, the

25-14    time and place for receipt of proposals, and other information that

25-15    may assist the board in its selection of a construction

25-16    manager-at-risk.  The board may request that proposals provide the

25-17    construction manager's proposed fee and its price for fulfilling

25-18    the general conditions.  The board shall state the selection

25-19    criteria in the request for proposals. The selection criteria may

25-20    include the offeror's experience, past performance, safety record,

25-21    proposed personnel and methodology, and other appropriate factors

25-22    that demonstrate the capability of the construction manager.

25-23          (f)  The board shall publish the request for proposals in  a

25-24    manner prescribed by the board.

25-25          (g)  The board may provide for prequalifying offerors before

25-26    proposals are submitted.  Prequalification may not be a conclusive

25-27    determination that an offeror offers the best value to the

 26-1    institution,  and a prequalified offeror may be rejected on the

 26-2    basis of subsequently discovered information.  A failure to

 26-3    prequalify does not bar a subsequent determination that an offeror

 26-4    offers the best value to the institution  with respect to a given

 26-5    proposal.

 26-6          (h)  The board shall receive, publicly open, and read aloud

 26-7    the names of the offerors and the monetary proposals, if any, for

 26-8    each proposal.  Within 45 days after the date of opening the

 26-9    proposals, the board shall evaluate and rank each proposal

26-10    submitted in relation to the criteria set forth in the request for

26-11    proposals.

26-12          (i)  The board shall select the offeror that offers the best

26-13    value to the institution based on the published selection criteria

26-14    and on its ranking evaluation.   If the board is unable to reach a

26-15    contract agreement with the selected offeror, the board shall

26-16    terminate further discussions and proceed to the next offeror in

26-17    the order of the selection ranking until a contract agreement is

26-18    reached or all proposals are rejected.

26-19          (j)  A construction manager-at-risk shall publicly advertise

26-20    and solicit either competitive bids or competitive sealed proposals

26-21    from trade contractors or subcontractors for the performance of all

26-22    major elements of the work other than the minor work that may be

26-23    included in the general conditions.  A construction manager-at-risk

26-24    may seek to perform portions of the work itself if the construction

26-25    manager-at-risk submits its bid or proposal for those portions of

26-26    the work in the same manner as all other trade contractors or

26-27    subcontractors and if the board determines that the construction

 27-1    manager-at-risk's bid or proposal provides the best value for the

 27-2    institution.

 27-3          (k)  The construction manager-at-risk and the board or its

 27-4    representative shall receive and open all trade contractor or

 27-5    subcontractor bids or proposals in a manner that does not disclose

 27-6    the contents of the bid or proposal during the selection process.

 27-7    All bids or proposals shall be made public within seven days after

 27-8    the date of final selection.

 27-9          (l)  If the construction manager-at-risk reviews, evaluates,

27-10    and recommends to the board a bid or proposal from a trade

27-11    contractor or subcontractor but the board requires another bid or

27-12    proposal to be accepted, the institution shall compensate the

27-13    construction manager-at-risk by a change in price, time, or

27-14    guaranteed maximum cost for any additional cost and risk that the

27-15    construction manager-at-risk may incur because of the board's

27-16    requirement that another bid or proposal be accepted.

27-17          Sec. 51.783. SELECTING CONTRACTOR FOR CONSTRUCTION SERVICES

27-18    THROUGH COMPETITIVE SEALED PROPOSALS.  (a) In selecting a

27-19    contractor for construction, rehabilitation, alteration, or repair

27-20    services for a facility through competitive sealed proposals, a

27-21    board shall follow the procedures prescribed by this section.

27-22          (b)  The board shall select or designate an engineer or

27-23    architect to prepare construction documents for the project. The

27-24    selected or designated engineer or architect has full

27-25    responsibility for complying with The Texas Engineering Practice

27-26    Act (Article 3271a, Vernon's Texas Civil Statutes) or Chapter 478,

27-27    Acts of the 45th Legislature, Regular Session, 1937 (Article 249a,

 28-1    Vernon's Texas Civil Statutes), as applicable.  If the engineer or

 28-2    architect is not a full-time employee of the institution, the board

 28-3    shall select the engineer or architect on the basis of demonstrated

 28-4    competence and qualifications as provided by Section 2254.004,

 28-5    Government Code.

 28-6          (c)  The board shall provide or contract for, independently

 28-7    of the contractor, the inspection services, the testing of

 28-8    construction materials engineering, and the verification testing

 28-9    services necessary for acceptance of the facility by the

28-10    institution.  The board shall select those services for which it

28-11    contracts in accordance with Section 2254.004, Government Code.

28-12          (d)  The board shall prepare a request for competitive sealed

28-13    proposals that includes construction documents, selection criteria,

28-14    estimated budget, project scope, schedule, and other information

28-15    that contractors may require to respond to the request.  The board

28-16    shall state the selection criteria in the request for proposals.

28-17    The selection criteria may include the offeror's experience, past

28-18    performance, safety record, proposed personnel and methodology, and

28-19    other appropriate factors that demonstrate the capability of the

28-20    contractor.

28-21          (e)  The board shall publish notice of the request for

28-22    proposals in a manner prescribed by the board.

28-23          (f)  The board may provide for prequalifying offerors before

28-24    proposals are submitted.  Prequalification may not be a conclusive

28-25    determination that an offeror offers the best value to the

28-26    institution,  and a prequalified  offeror may be rejected on the

28-27    basis of subsequently discovered information.  A failure to

 29-1    prequalify does not bar a subsequent determination that an offeror

 29-2    offers the best value to the institution with respect to a given

 29-3    proposal.

 29-4          (g)  The board shall receive, publicly open, and read aloud

 29-5    the names of the offerors and the monetary proposals, if any,

 29-6    stated in each proposal.  Within 45 days after the date of opening

 29-7    the proposals the board shall evaluate and rank each proposal

 29-8    submitted in relation to the published selection criteria.

 29-9          (h)  The board shall select the offeror that offers the best

29-10    value to the institution based on the published selection criteria

29-11    and on its ranking evaluation.  The board and its engineer or

29-12    architect may discuss with the selected offeror options for cost

29-13    reduction.  If the board is unable to reach a contract agreement

29-14    with the selected offeror, the board shall terminate further

29-15    discussions and proceed to the next offeror in the order of the

29-16    selection ranking until a contract agreement is reached or all

29-17    proposals are rejected.

29-18          (i)  In determining best value for the institution, the board

29-19    is not restricted to considering price alone, but may consider any

29-20    other factor stated in the selection criteria.

29-21          Sec. 51.784.  JOB ORDER CONTRACTS FOR FACILITIES REPAIR.  (a)

29-22    An institution may award job order contracts for the minor repair,

29-23    rehabilitation, or alteration of a facility if the work is of a

29-24    recurring nature but the delivery times are indefinite and

29-25    indefinite quantities and orders are awarded substantially on the

29-26    basis of predescribed and prepriced tasks.

29-27          (b)  The board shall advertise for, receive, and publicly

 30-1    open competitive sealed proposals for job order contracts based on

 30-2    time and material rates for various types and classifications of

 30-3    work.  The rates under a job order contract shall be in effect for

 30-4    at least six months and for not longer than two years.

 30-5          (c)  The board may require offerors to submit additional

 30-6    information besides rates, including experience, past performance,

 30-7    and proposed personnel and methodology.

 30-8          (d)  The board may award job order contracts to one or more

 30-9    contractors based on price proposals, experience, past performance,

30-10    proposed personnel and methodology, safety record, and other

30-11    appropriate factors.

30-12          (e)  An order for a job or project under the job order

30-13    contract must be signed by the board's representative and the

30-14    contractor.  The order may be a fixed price, lump-sum contract

30-15    based on a statement of work negotiated between the board or its

30-16    representative and the contractor, or the order may be a unit price

30-17    order based on estimated quantities.  The contractor shall provide

30-18    payment and performance bonds, if required by law, based on the

30-19    amount or estimated amount of any order.

30-20          SECTION 4.  Section 51.907, Education Code, is repealed.

30-21          SECTION 5.  This Act takes effect September 1, 1997.  The

30-22    changes in law made by this Act apply only to a contract for which

30-23    requests for bids, requests for proposals, or requests for

30-24    qualifications are published or distributed on or after that date.

30-25          SECTION 6.  The importance of this legislation and the

30-26    crowded condition of the calendars in both houses create an

30-27    emergency and an imperative public necessity that the

 31-1    constitutional rule requiring bills to be read on three several

 31-2    days in each house be suspended, and this rule is hereby suspended.