1-1 By: Lewis of Orange (Senate Sponsor - Shapiro) H.B. No. 2492
1-2 (In the Senate - Received from the House April 19, 1999;
1-3 April 20, 1999, read first time and referred to Committee on State
1-4 Affairs; May 7, 1999, reported favorably by the following vote:
1-5 Yeas 8, Nays 0; May 7, 1999, sent to printer.)
1-6 A BILL TO BE ENTITLED
1-7 AN ACT
1-8 relating to contracts for and the financing of energy conservation
1-9 measures taken by state agencies and political subdivisions.
1-10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-11 SECTION 1. Section 44.901, Education Code, is amended by
1-12 amending Subsections (f)-(h) and adding Subsection (i) to read as
1-13 follows:
1-14 (f) Energy [A contract for energy] conservation measures[,]
1-15 with respect to existing buildings or facilities[,] may be
1-16 financed:
1-17 (1) under a lease/purchase contract that has[, with] a
1-18 term not to exceed 15 [10] years from the final date of
1-19 installation and[,] that meets federal tax requirements for
1-20 tax-free municipal leasing or long-term financing;
1-21 (2) with the proceeds of bonds; or
1-22 (3) under a contract with the provider of the energy
1-23 conservation measures that has a term not to exceed 15 years from
1-24 the final date of installation.
1-25 (g) A [The] contract for energy conservation measures shall
1-26 contain provisions pursuant to which the provider of the energy
1-27 conservation measures guarantees the amount of the savings to be
1-28 realized by the school district under the contract. If the term of
1-29 a contract for energy conservation measures exceeds one year, the
1-30 school district's contractual obligations in any one year during
1-31 the term of the contract beginning after the final date of
1-32 installation may not exceed the total energy and operating cost
1-33 savings, including but not limited to electrical, gas, or other
1-34 utility cost savings and operating cost savings resulting from
1-35 automatic monitoring and control as determined by the school
1-36 district in this subsection, divided by the number of years in the
1-37 contract term.
1-38 (h) [(g)] A contract under this section may be let under
1-39 competitive proposal procedures. Notice of the request for
1-40 proposals shall be published in the manner provided for
1-41 competitive bidding. Requests for proposals must solicit
1-42 quotations and must specify the relative importance of guaranteed
1-43 savings, price, return on investment, financial performance and
1-44 stability, quality, technical ability, experience, and other
1-45 evaluation factors. The contract shall be awarded to the
1-46 responsible offeror whose proposal, following negotiations, is
1-47 determined to be the most advantageous to the school district
1-48 considering the guaranteed savings and other evaluation factors set
1-49 forth in the request for proposals.
1-50 (i) [(h)] To obtain the best final offers, the school
1-51 district may allow proposal revisions after submissions and before
1-52 the award of the contract.
1-53 SECTION 2. Section 51.927, Education Code, as amended by
1-54 Chapters 627 and 1142, Acts of the 75th Legislature, Regular
1-55 Session, 1997, is amended by reenacting and amending Subsections
1-56 (f)-(k) and adding Subsection (l) to read as follows:
1-57 (f) The board may enter into a contract for a period of more
1-58 than one year for energy conservation measures with an entity if
1-59 the board finds that the amount the institution would spend on the
1-60 energy conservation measures will not exceed the amount to be saved
1-61 in energy and operating costs over 15 [10] years from the date of
1-62 installation. If the term of a contract for energy conservation
1-63 measures exceeds one year, the board's contractual obligation in
1-64 any year during the term of the contract beginning after the final
2-1 date of installation may not exceed the total energy and operating
2-2 cost savings, including but not limited to electrical, gas, or
2-3 other utility cost savings and operating cost savings resulting
2-4 from automatic monitoring and control, as determined by the board
2-5 in this subsection, divided by the number of years in the contract
2-6 term beginning after the final date of installation. The board
2-7 shall consider all costs of the energy conservation measures,
2-8 including costs of design, engineering, installation, maintenance,
2-9 repairs, and debt service.
2-10 (g) Energy [A contract for energy] conservation measures may
2-11 be financed:
2-12 (1) under a lease/purchase contract that has [, with]
2-13 a term not to exceed 15 [10] years from [after] the final date of
2-14 installation and[,] that meets federal tax requirements for
2-15 tax-free municipal leasing or long-term financing;
2-16 (2) with the proceeds of bonds; or
2-17 (3) under a contract with the provider of the energy
2-18 conservation measures that has a term not to exceed 15 years from
2-19 the final date of installation.
2-20 (h) A [The] contract for energy conservation measures shall
2-21 contain provisions pursuant to which the provider of the energy
2-22 conservation measures guarantees the amount of the savings to be
2-23 realized by the institution of higher education under the contract.
2-24 The Master Equipment Lease Purchase Program operated by the Texas
2-25 Public Finance Authority may be utilized by an institution to fund
2-26 a contract for energy conservation measures so long as the costs of
2-27 the energy conservation measures, including costs of design,
2-28 engineering, installation, maintenance, repairs, and anticipated
2-29 debt service requirements of the Master Equipment Lease Purchase
2-30 Program, do not exceed the total energy and operating cost savings,
2-31 as described in Subsection (f) [(e)], beginning after the final
2-32 date of installation.
2-33 (i) [(h)] A contract under this section may be let under
2-34 competitive sealed proposal procedures. Notice of the request for
2-35 proposals shall be given in the manner provided for in Chapter
2-36 2156, Government Code. The Texas Higher Education Coordinating
2-37 Board, in consultation with the State Energy Conservation Office
2-38 and the Texas Energy Coordination Council, shall establish
2-39 guidelines and an approval process for contracts awarded under this
2-40 section. The State Energy Conservation Office and the Texas Energy
2-41 Coordination Council shall review the selected proposal before a
2-42 contract is awarded. The State Energy Conservation Office may
2-43 provide a cost-benefit analysis of the proposals and analysis of
2-44 the guaranteed savings projected by offerors and may charge a fee
2-45 for this service. The contract shall be awarded to the
2-46 responsible offeror whose proposal, following negotiations, is
2-47 determined by the institution to be the most advantageous to the
2-48 institution considering the guaranteed savings and other evaluation
2-49 factors set forth in the request for proposals, except that if the
2-50 institution finds that no offer is acceptable, it shall refuse all
2-51 offers.
2-52 (j) [(i)] In accordance with regulations adopted by the
2-53 institution, the institution may conduct discussions with offerors
2-54 who submit proposals and who are determined to be reasonably
2-55 qualified for the award of the contract. Offerors shall be treated
2-56 fairly and equally with respect to any opportunity for discussion
2-57 and revision of proposals. To obtain the best final offers, the
2-58 institution may allow proposal revisions after submissions and
2-59 before the award of the contract.
2-60 (k) [(j)] If provided in a request for proposals under
2-61 Subsection (i) [(g) of this section], proposals shall be opened in
2-62 a manner that avoids disclosure of the contents to competing
2-63 offerors and keeps the proposals secret during negotiations. All
2-64 proposals are open for public inspection after a contract is
2-65 awarded unless the information is excepted from disclosure under
2-66 Chapter 552, Government Code.
2-67 (l) [(k)] The legislature shall base an institution's
2-68 appropriation for energy costs during a fiscal year on the sum of:
2-69 (1) the institution's estimated energy costs for that
3-1 fiscal year; and
3-2 (2) if a contract under this section is in effect, the
3-3 institution's estimated net savings resulting from the contract
3-4 during the contract term, divided by the number of years in the
3-5 contract term.
3-6 SECTION 3. Section 2166.406, Government Code, is amended by
3-7 amending Subsections (b) and (f)-(l) and adding Subsection (m) to
3-8 read as follows:
3-9 (b) A contract authorized under this section [chapter]
3-10 includes a contract for the installation of:
3-11 (1) insulation of the building structure and systems
3-12 within the building;
3-13 (2) storm windows or doors, caulking or weather
3-14 stripping, multiglazed windows or doors, heat absorbing or heat
3-15 reflective glazed and coated window or door systems, or other
3-16 window or door system modifications that reduce energy consumption;
3-17 (3) automatic energy control systems, including
3-18 computer software and technical data licenses;
3-19 (4) heating, ventilating, or air-conditioning system
3-20 modifications or replacements;
3-21 (5) lighting fixtures that increase energy efficiency;
3-22 (6) energy recovery systems;
3-23 (7) electric systems improvements; or
3-24 (8) other energy conservation-related improvements or
3-25 equipment (including improvements or equipment related to renewable
3-26 energy).
3-27 (f) The state agency may enter into a contract for a period
3-28 of more than one year for energy conservation measures with an
3-29 entity if the state agency finds that the amount the state agency
3-30 would spend on the energy conservation measures will not exceed the
3-31 amount to be saved in energy and operating costs over 15 [10] years
3-32 from the date of installation.
3-33 (g) Energy [A contract for energy] conservation measures[,]
3-34 with respect to existing buildings or facilities[,] may be
3-35 financed:
3-36 (1) under a lease/purchase contract that has [with] a
3-37 term not to exceed 15 [10] years from the final date of
3-38 installation and[,] that meets federal tax requirements for
3-39 tax-free municipal leasing or long-term financing;
3-40 (2) with the proceeds of bonds; or
3-41 (3) under a contract with the provider of the energy
3-42 conservation measures that has a term not to exceed 15 years from
3-43 the final date of installation.
3-44 (h) A [The] contract for energy conservation measures shall
3-45 contain provisions pursuant to which the provider of the energy
3-46 conservation measures guarantees the amount of the savings to be
3-47 realized by the state agency under the contract. If the term of a
3-48 contract for energy conservation measures exceeds one year, the
3-49 agency's contractual obligation in any year during the term of the
3-50 contract beginning after the final date of installation may not
3-51 exceed the total energy and operating cost savings, including but
3-52 not limited to electrical, gas, or other utility cost savings and
3-53 operating cost savings resulting from automatic monitoring and
3-54 control, as determined by the state agency in this subsection,
3-55 divided by the number of years in the contract term.
3-56 (i) [(h)] A contract under this section [chapter] may be let
3-57 under competitive sealed proposal procedures. Notice of the
3-58 request for proposals shall be given in the manner provided for in
3-59 Chapter 2156[, Government Code]. Before awarding the contract, the
3-60 state agency shall submit the selected proposal to the State Energy
3-61 Conservation Office and the Texas Energy Coordination Council for
3-62 review and comment before awarding the contract. The State Energy
3-63 Conservation Office and the Texas Energy Coordination Council will
3-64 provide a cost-benefit analysis of the proposals and an analysis of
3-65 the guaranteed savings projected by offerors and may charge a fee
3-66 for this service. The contract shall be awarded to the responsible
3-67 offeror whose proposal, following negotiations, is determined to be
3-68 the most advantageous to the state agency considering the savings
3-69 and other evaluation factors set forth in the request for proposals
4-1 except that if the state agency finds that no offer is acceptable,
4-2 it shall refuse all offers.
4-3 (j) [(i)] In accordance with regulations adopted by the
4-4 state agency, the state agency may conduct discussions with
4-5 offerors who submit proposals and who are determined to be
4-6 reasonably qualified for the award of the contract. Offerors shall
4-7 be treated fairly and equally with respect to any opportunity for
4-8 discussion and revision of proposals.
4-9 (k) [(j)] If provided in a request for proposals, proposals
4-10 shall be opened in a manner that avoids disclosure of the contents
4-11 to competing offerors and keeps the proposals secret during
4-12 negotiations. All proposals are open for public inspection after a
4-13 contract is awarded unless the information is excepted from
4-14 disclosure under Chapter 552[, Government Code].
4-15 (l) [(k)] To obtain the best final offers, the state agency
4-16 may allow proposal revisions after submissions and before the award
4-17 of the contract. Final review and approval of the contract will be
4-18 provided by the State Energy Conservation Office.
4-19 (m) [(l)] The legislature shall base an agency's
4-20 appropriation for energy costs during a fiscal year on the sum of:
4-21 (1) the agency's estimated energy costs for that
4-22 fiscal year; and
4-23 (2) if a contract under this section is in effect, the
4-24 agency's estimated net savings resulting from the contract during
4-25 the contract term, divided by the number of years in the contract
4-26 term.
4-27 SECTION 4. Section 302.004, Local Government Code, is
4-28 amended to read as follows:
4-29 Sec. 302.004. METHOD OF FINANCING; TERMS OF [LEASE-PURCHASE]
4-30 CONTRACT [AUTHORIZED]. (a) Energy [A contract for energy]
4-31 conservation measures[,] with respect to existing buildings or
4-32 facilities[,] may be financed:
4-33 (1) under a lease-purchase contract that has [with] a
4-34 term not to exceed 15 [10] years from the final date of
4-35 installation and that meets federal tax requirements for tax-free
4-36 municipal leasing or long-term financing;
4-37 (2) with the proceeds of bonds; or
4-38 (3) under a contract with the provider of the energy
4-39 conservation measures that has a term not to exceed 15 years from
4-40 the final date of installation.
4-41 (b) The contract shall contain provisions pursuant to which
4-42 the provider of the energy conservation measures guarantees the
4-43 amount of the savings to be realized by the local government under
4-44 the contract. If the term of a contract for energy conservation
4-45 measures exceeds one year, the local government's contractual
4-46 obligations in any one year during the term of the contract
4-47 beginning after the final date of installation may not exceed the
4-48 total energy and operating cost savings, including but not limited
4-49 to electrical, gas, or other utility cost savings and operating
4-50 cost savings resulting from automatic monitoring and control as
4-51 determined by the local government in this subsection, divided by
4-52 the number of years in the contract term.
4-53 SECTION 5. To the extent of any conflict, this Act prevails
4-54 over another Act of the 76th Legislature, Regular Session, 1999,
4-55 relating to nonsubstantive additions and corrections in enacted
4-56 codes, including H.B. No. 3156 or S.B. No. 1368.
4-57 SECTION 6. This Act takes effect September 1, 1999.
4-58 SECTION 7. The importance of this legislation and the
4-59 crowded condition of the calendars in both houses create an
4-60 emergency and an imperative public necessity that the
4-61 constitutional rule requiring bills to be read on three several
4-62 days in each house be suspended, and this rule is hereby suspended.
4-63 * * * * *