By Longoria                                           H.B. No. 3186
         76R11794 JRD-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to obtaining bonds and insurance required for certain
 1-3     state construction projects.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 2166.258, Government Code, is amended to
 1-6     read as follows:
 1-7           Sec. 2166.258.  COMMON SURETY OR INSURER.  (a)  The
 1-8     commission and each [or an] agency whose project is exempted from
 1-9     all or part of this chapter under Section 2166.003 shall jointly or
1-10     separately enter into a competitively bid contract [may negotiate
1-11     an arrangement advantageous to the state] with a surety or an
1-12     insurer, as appropriate, authorized to do business in this state
1-13     and with experience in surety bond support services, under which
1-14     the surety or insurer shall:
1-15                 (1)  aggressively assist historically underutilized
1-16     businesses and small businesses to obtain the bonds or insurance
1-17     required to qualify for a contract or subcontract on a project
1-18     administered by the commission or other agency; and
1-19                 (2)  [to] furnish the required bonds, insurance, or
1-20     both to historically underutilized businesses, small businesses,
1-21     and other businesses [that a contractor or subcontractor is
1-22     required to execute or carry to receive a contract or subcontract
1-23     on a project administered by the commission or other agency].
1-24           (b)  Notwithstanding Section 1, Chapter 87, Acts of the 56th
 2-1     Legislature, Regular Session, 1959 (Article 7.19-1, Vernon's Texas
 2-2     Insurance Code), the commission and an [or other] agency whose
 2-3     project is exempted from all or part of this chapter under Section
 2-4     2166.003 shall [may] require a contractor or subcontractor to meet
 2-5     part or all of the bonding or insurance requirements for the
 2-6     project under the contract entered into under Subsection (a)
 2-7     [arrangement negotiated] by the commission or other agency.
 2-8           (c)  A contract under Subsection (a) must:
 2-9                 (1)  be renewed at least once each state fiscal
2-10     biennium;
2-11                 (2)  require the surety or insurer to aggressively take
2-12     steps to furnish required bonds, insurance, or both to historically
2-13     underutilized businesses and small businesses; and
2-14                 (3)  provide that the surety's or insurer's performance
2-15     under the contract will be evaluated at least in part on the basis
2-16     of the number of historically underutilized businesses, small
2-17     businesses, and other businesses that obtain the required bonds,
2-18     insurance, or both from the contractor.
2-19           (d)  The commission or other state agency entering into a
2-20     contract with  a surety or insurer under Subsection (a) shall
2-21     conduct annual program audits and performance reviews under the
2-22     contract.
2-23           SECTION 2.  This Act takes effect September 1, 1999. The
2-24     change in law made by this Act does not affect a contract entered
2-25     into between a state agency and a surety or an insurer under
2-26     Section 2166.258, Government Code, that is in force on that date
2-27     during the term of the contract, but the renewal of the contract
 3-1     must comply with Section 2166.258, Government Code, as amended by
 3-2     this Act.
 3-3           SECTION 3.  The importance of this legislation and the
 3-4     crowded condition of the calendars in both houses create an
 3-5     emergency and an imperative public necessity that the
 3-6     constitutional rule requiring bills to be read on three several
 3-7     days in each house be suspended, and this rule is hereby suspended.