1-1 By: Zaffirini S.B. No. 1066
1-2 (In the Senate - Filed March 10, 1997; March 12, 1997, read
1-3 first time and referred to Committee on State Affairs;
1-4 April 30, 1997, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 10, Nays 0; April 30, 1997,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 1066 By: Carona
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to procurement practices by health and human services
1-11 agencies, by certain other agencies with programs related to health
1-12 or human services, and by certain public and private local
1-13 providers of health or human services.
1-14 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-15 SECTION 1. Subchapter C, Chapter 2155, Government Code, is
1-16 amended by adding Section 2155.144 to read as follows:
1-17 Sec. 2155.144. PROCUREMENTS BY HEALTH AND HUMAN SERVICES
1-18 AGENCIES AND WORKERS' COMPENSATION COMMISSION. (a) This section
1-19 applies only to the Health and Human Services Commission, to each
1-20 health and human services agency, and to the Texas Workers'
1-21 Compensation Commission.
1-22 (b) An agency to which this section applies is delegated the
1-23 authority to procure its goods and services, except as provided by
1-24 this section.
1-25 (c) An agency to which this section applies may acquire
1-26 goods or services by any procurement method that provides the best
1-27 value to the agency. The agency shall document that it considered
1-28 all relevant factors under Subsection (d) in making the
1-29 acquisition.
1-30 (d) Subject to Subsection (e), the agency may consider all
1-31 relevant factors in determining the best value, including:
1-32 (1) any installation costs;
1-33 (2) the delivery terms;
1-34 (3) the quality and reliability of the vendor's goods
1-35 or services;
1-36 (4) the extent to which the goods or services meet the
1-37 agency's needs;
1-38 (5) indicators of probable vendor performance under
1-39 the contract such as past vendor performance, the vendor's
1-40 financial resources and ability to perform, the vendor's experience
1-41 and responsibility, and the vendor's ability to provide reliable
1-42 maintenance agreements;
1-43 (6) the impact on the ability of the agency to comply
1-44 with laws and rules relating to historically underutilized
1-45 businesses;
1-46 (7) the total long-term cost to the agency of
1-47 acquiring the vendor's goods or services;
1-48 (8) the cost of any employee training associated with
1-49 the acquisition;
1-50 (9) the effect of an acquisition on agency
1-51 productivity;
1-52 (10) the acquisition price; and
1-53 (11) any other factor relevant to determining the best
1-54 value for the agency in the context of a particular acquisition.
1-55 (e) If an agency to which this section applies acquires
1-56 goods or services with a value that exceeds $100,000, the agency
1-57 shall consult with and receive approval from the Health and Human
1-58 Services Commission before considering factors other than price and
1-59 meeting specifications.
1-60 (f) The state auditor may audit the agency's acquisitions of
1-61 goods and services.
1-62 (g) The agency may adopt rules and procedures for the
1-63 acquisition of goods and services under this section.
1-64 (h) The Health and Human Services Commission shall adopt
2-1 rules and procedures for the acquisition of goods and services
2-2 under this section that apply to all health and human services
2-3 agencies, including rules adopted with the commission's assistance
2-4 that allow an agency to make purchases through a group purchasing
2-5 program except when a better value is available through another
2-6 procurement method. The rules of the health and human services
2-7 agencies must be consistent with the rules of the Health and Human
2-8 Services Commission.
2-9 (i) The Health and Human Services Commission shall
2-10 coordinate the procurement practices of all health and human
2-11 services agencies and encourage those agencies to use efficient
2-12 procurement practices such as the use of a group purchasing
2-13 program, combining maintenance contracts into one contract, and
2-14 obtaining prompt payment discounts. The Health and Human Services
2-15 Commission may transfer the procurement functions of a health and
2-16 human services agency to another appropriate state agency if it
2-17 determines that transferring those functions would be advantageous
2-18 to the state. Other state agencies and institutions with
2-19 experience in acquiring goods and services using the procedures
2-20 allowed under Subsections (c) and (d) shall on request assist the
2-21 Health and Human Services Commission to perform its functions under
2-22 this section.
2-23 (j) To the extent of any conflict, this section prevails
2-24 over any other state law relating to the procurement of goods and
2-25 services except a law relating to contracting with historically
2-26 underutilized businesses.
2-27 (k) In this section, "health and human services agency" has
2-28 the meaning assigned by Section 531.001.
2-29 SECTION 2. Subchapter B, Chapter 32, Human Resources Code,
2-30 is amended by adding Sections 32.043 and 32.044 to read as follows:
2-31 Sec. 32.043. PROCUREMENT RULES FOR PUBLIC DISPROPORTIONATE
2-32 SHARE HOSPITALS. (a) A public hospital that is designated as a
2-33 disproportionate share hospital during a fiscal year may acquire
2-34 goods and services in accordance with this section during the
2-35 succeeding fiscal year. A procurement of goods or services made in
2-36 accordance with this section is considered to satisfy any state law
2-37 requiring purchases by competitive bidding or competitive
2-38 proposals.
2-39 (b) The public hospital may acquire goods or services by any
2-40 procurement method that provides the best value to the public
2-41 hospital. The public hospital shall document that it considered
2-42 all relevant factors under Subsection (c) in making the
2-43 acquisition.
2-44 (c) Subject to Subsection (d), the public hospital may
2-45 consider all relevant factors in determining the best value,
2-46 including:
2-47 (1) any installation costs;
2-48 (2) the delivery terms;
2-49 (3) the quality and reliability of the vendor's goods
2-50 or services;
2-51 (4) the extent to which the goods or services meet the
2-52 public hospital's needs;
2-53 (5) indicators of probable vendor performance under
2-54 the contract such as past vendor performance, the vendor's
2-55 financial resources and ability to perform, the vendor's experience
2-56 and responsibility, and the vendor's ability to provide reliable
2-57 maintenance agreements;
2-58 (6) the impact on the ability of the public hospital
2-59 to comply with laws and rules relating to historically
2-60 underutilized businesses;
2-61 (7) the total long-term cost to the public hospital of
2-62 acquiring the vendor's goods or services;
2-63 (8) the cost of any employee training associated with
2-64 the acquisition;
2-65 (9) the effect of an acquisition on the public
2-66 hospital's productivity;
2-67 (10) the acquisition price; and
2-68 (11) any other factor relevant to determining the best
2-69 value for the public hospital in the context of a particular
3-1 acquisition.
3-2 (d) If the public hospital acquires goods or services with a
3-3 value that exceeds $100,000, the public hospital shall consult with
3-4 and receive approval from the Health and Human Services Commission
3-5 before considering factors other than price and meeting
3-6 specifications.
3-7 (e) The state auditor or the department may audit the public
3-8 hospital's acquisitions of goods and services to the extent that
3-9 state money or federal money appropriated by the state is used to
3-10 acquire the goods and services.
3-11 (f) The public hospital may adopt rules and procedures for
3-12 the acquisition of goods and services under this section.
3-13 Sec. 32.044. GROUP PURCHASING FOR DISPROPORTIONATE SHARE
3-14 HOSPITALS. (a) A public or private hospital that is designated as
3-15 a disproportionate share hospital during a fiscal year may purchase
3-16 goods and services in accordance with this section during the
3-17 succeeding fiscal year. A purchase of goods or services made in
3-18 accordance with this section is considered to satisfy any state law
3-19 requiring purchases by competitive bidding or competitive
3-20 proposals.
3-21 (b) A state or local governmental entity may allow the
3-22 public or private hospital to purchase goods or services by
3-23 participating in one or more of the entity's contracts for the
3-24 purchase of goods or services.
3-25 (c) The public or private hospital may purchase goods or
3-26 services in accordance with this section through a group purchasing
3-27 program that offers discount prices to hospitals or other providers
3-28 of health care services.
3-29 (d) The department with the assistance of the Health and
3-30 Human Services Commission and the General Services Commission shall
3-31 adopt rules under this section that allow the public or private
3-32 hospital to make purchases through group purchasing programs except
3-33 when the department has reason to believe that a better value is
3-34 available through another procurement method.
3-35 (e) This section applies to private hospitals only to the
3-36 extent it authorizes private hospitals to participate in purchasing
3-37 contracts with governmental entities or to satisfy any state law
3-38 that may require goods and services the hospital purchases to be
3-39 competitively procured. This section does not impose new
3-40 purchasing requirements on a private hospital, except to the extent
3-41 that the private hospital agrees to be bound by the terms of a
3-42 contract that is authorized by this section and that it chooses to
3-43 enter. This section does not affect any explicit or implicit
3-44 authority that a private hospital has under other law to
3-45 participate in a group purchasing program or to participate in a
3-46 purchasing contract with a public entity.
3-47 SECTION 3. Subsections (a) and (b), Section 12.052, Health
3-48 and Safety Code, are amended to read as follows:
3-49 (a) The expenditure of funds received by local units of
3-50 government from the department is governed by Chapter 783,
3-51 Government Code, [the Uniform Grant and Contract Management Act of
3-52 1981 (Article 4413(32g), Vernon's Texas Civil Statutes)] and the
3-53 rules adopted under that law, except as provided by Section 12.055
3-54 [Act].
3-55 (b) The expenditure of funds received by other state
3-56 agencies from the department is governed by Subtitle D, Title 10,
3-57 Government Code, [the State Purchasing and General Services Act
3-58 (Article 601b, Vernon's Texas Civil Statutes)] and the rules
3-59 adopted under that law, except as provided by Section 12.055 [Act].
3-60 SECTION 4. Subchapter E, Chapter 12, Health and Safety Code,
3-61 is amended by adding Sections 12.055 and 12.056 to read as follows:
3-62 Sec. 12.055. CERTAIN PROCUREMENTS MADE WITH DEPARTMENT
3-63 FUNDS. (a) A state agency or local unit of government that
3-64 expends funds received from the department for the acquisition of
3-65 goods and services may satisfy the requirements of Section 12.052
3-66 or of another state law requiring procurements by competitive
3-67 bidding or competitive sealed proposals by procuring goods or
3-68 services with those funds in accordance with Section 12.056 or in
3-69 accordance with:
4-1 (1) Section 2155.144, Government Code, if the entity
4-2 is a state agency subject to that law;
4-3 (2) Section 32.043 or 32.044, Human Resources Code, if
4-4 the entity is a public hospital subject to those laws; or
4-5 (3) this section, if the entity is not covered by
4-6 Subdivision (1) or (2).
4-7 (b) A state agency or local unit of government under
4-8 Subsection (a)(3) may acquire goods or services by any procurement
4-9 method that provides the best value to the state agency or local
4-10 unit of government. The state agency or local unit of government
4-11 shall document that the state agency or local unit of government
4-12 considered all relevant factors under Subsection (c) in making the
4-13 acquisition.
4-14 (c) Subject to Subsection (d), the state agency or local
4-15 unit of government may consider all relevant factors in determining
4-16 the best value, including:
4-17 (1) any installation costs;
4-18 (2) the delivery terms;
4-19 (3) the quality and reliability of the vendor's goods
4-20 or services;
4-21 (4) the extent to which the goods or services meet the
4-22 state agency's or local unit of government's needs;
4-23 (5) indicators of probable vendor performance under
4-24 the contract such as past vendor performance, the vendor's
4-25 financial resources and ability to perform, the vendor's experience
4-26 and responsibility, and the vendor's ability to provide reliable
4-27 maintenance agreements;
4-28 (6) the impact on the ability of the state agency or
4-29 local unit of government to comply with laws and rules relating to
4-30 historically underutilized businesses;
4-31 (7) the total long-term cost to the state agency or
4-32 local unit of government of acquiring the vendor's goods or
4-33 services;
4-34 (8) the cost of any employee training associated with
4-35 the acquisition;
4-36 (9) the effect of an acquisition on the state agency's
4-37 or local unit of government's productivity;
4-38 (10) the acquisition price; and
4-39 (11) any other factor relevant to determining the best
4-40 value for the state agency or local unit of government in the
4-41 context of a particular acquisition.
4-42 (d) If a state agency to which this section applies acquires
4-43 goods or services with a value that exceeds $100,000, the state
4-44 agency shall consult with and receive approval from the Health and
4-45 Human Services Commission before considering factors other than
4-46 price and meeting specifications.
4-47 (e) The state auditor or the department may audit the state
4-48 agency's or local unit of government's acquisitions of goods and
4-49 services under this section.
4-50 (f) The state agency or local unit of government may adopt
4-51 rules and procedures for the acquisition of goods and services
4-52 under this section.
4-53 Sec. 12.056. PARTICIPATION IN DEPARTMENT PURCHASING
4-54 CONTRACTS OR GROUP PURCHASING PROGRAM. The department may allow a
4-55 state agency, local unit of government, or private entity that
4-56 expends funds received by the department to purchase goods or
4-57 services using those funds by participating in:
4-58 (1) a contract the department has made to purchase
4-59 goods or services; or
4-60 (2) a group purchasing program established or
4-61 designated by the department that offers discounts to providers of
4-62 health services.
4-63 SECTION 5. Subchapter A, Chapter 533, Health and Safety
4-64 Code, is amended by adding Sections 533.016 and 533.017 to read as
4-65 follows:
4-66 Sec. 533.016. CERTAIN PROCUREMENTS OF GOODS AND SERVICES BY
4-67 SERVICE PROVIDERS. (a) A state agency, local agency, local mental
4-68 health authority, or local mental retardation authority that
4-69 expends public money to acquire goods or services in connection
5-1 with providing or coordinating the provision of mental health or
5-2 mental retardation services may satisfy the requirements of any
5-3 state law requiring procurements by competitive bidding or
5-4 competitive sealed proposals by procuring goods or services with
5-5 the public money in accordance with Section 533.017 or in
5-6 accordance with:
5-7 (1) Section 2155.144, Government Code, if the entity
5-8 is a state agency subject to that law;
5-9 (2) Section 32.043 or 32.044, Human Resources Code, if
5-10 the entity is a public hospital subject to those laws; or
5-11 (3) this section, if the entity is not covered by
5-12 Subdivision (1) or (2).
5-13 (b) An agency or authority under Subsection (a)(3) may
5-14 acquire goods or services by any procurement method that provides
5-15 the best value to the agency or authority. The agency or authority
5-16 shall document that the agency or authority considered all relevant
5-17 factors under Subsection (c) in making the acquisition.
5-18 (c) Subject to Subsection (d), the agency or authority may
5-19 consider all relevant factors in determining the best value,
5-20 including:
5-21 (1) any installation costs;
5-22 (2) the delivery terms;
5-23 (3) the quality and reliability of the vendor's goods
5-24 or services;
5-25 (4) the extent to which the goods or services meet the
5-26 agency's or authority's needs;
5-27 (5) indicators of probable vendor performance under
5-28 the contract such as past vendor performance, the vendor's
5-29 financial resources and ability to perform, the vendor's experience
5-30 and responsibility, and the vendor's ability to provide reliable
5-31 maintenance agreements;
5-32 (6) the impact on the ability of the agency or
5-33 authority to comply with laws and rules relating to historically
5-34 underutilized businesses;
5-35 (7) the total long-term cost to the agency or
5-36 authority of acquiring the vendor's goods or services;
5-37 (8) the cost of any employee training associated with
5-38 the acquisition;
5-39 (9) the effect of an acquisition on the agency's or
5-40 authority's productivity;
5-41 (10) the acquisition price; and
5-42 (11) any other factor relevant to determining the best
5-43 value for the agency or authority in the context of a particular
5-44 acquisition.
5-45 (d) If a state agency to which this section applies acquires
5-46 goods or services with a value that exceeds $100,000, the state
5-47 agency shall consult with and receive approval from the Health and
5-48 Human Services Commission before considering factors other than
5-49 price and meeting specifications.
5-50 (e) The state auditor or the department may audit the
5-51 agency's or authority's acquisitions of goods and services under
5-52 this section to the extent state money or federal money
5-53 appropriated by the state is used to make the acquisitions.
5-54 (f) The agency or authority may adopt rules and procedures
5-55 for the acquisition of goods and services under this section.
5-56 Sec. 533.017. PARTICIPATION IN DEPARTMENT PURCHASING
5-57 CONTRACTS OR GROUP PURCHASING PROGRAM. The department may allow a
5-58 state agency, local agency, local mental health authority, or local
5-59 mental retardation authority that expends public money to purchase
5-60 goods or services in connection with providing or coordinating the
5-61 provision of mental health or mental retardation services to
5-62 purchase goods or services with the public money by participating
5-63 in:
5-64 (1) a contract the department has made to purchase
5-65 goods or services; or
5-66 (2) a group purchasing program established or
5-67 designated by the department that offers discounts to providers of
5-68 mental health or mental retardation services.
5-69 SECTION 6. This Act takes effect September 1, 1997.
6-1 SECTION 7. The importance of this legislation and the
6-2 crowded condition of the calendars in both houses create an
6-3 emergency and an imperative public necessity that the
6-4 constitutional rule requiring bills to be read on three several
6-5 days in each house be suspended, and this rule is hereby suspended.
6-6 * * * * *