By Ogden S.B. No. 514 Substitute the following for S.B. No. 514: By Alexander C.S.S.B. No. 514 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to the payment and use of a bid guaranty for a state 1-3 highway improvement contract. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Subchapter A, Chapter 223, Transportation Code, 1-6 is amended by adding Sections 223.014 and 223.015 to read as 1-7 follows: 1-8 Sec. 223.014. BID GUARANTY. (a) The commission shall adopt 1-9 rules on the method by which a bidder may submit a bid guaranty. 1-10 The rules may authorize the use of electronic funds transfer, 1-11 checks, including electronic checks, money orders, escrow accounts, 1-12 including the bidder's retainage escrow account, trust accounts, 1-13 including the bidder's retainage trust account, and credit cards 1-14 issued by a financial institution chartered by a state or the 1-15 United States or by a nationally recognized credit organization 1-16 approved by the department. The department may require the payment 1-17 of a discount or service charge for the use of a credit card. 1-18 (b) The department may establish one or more escrow accounts 1-19 in the state highway fund for the prepayment of bid guaranties. 1-20 The bid guaranties and any fees the department establishes to 1-21 administer this subsection shall be administered in accordance with 1-22 an agreement approved by the department. 1-23 (c) The department shall deposit each administrative fee and 2-1 discount or service charge collected under this section in the 2-2 state treasury to the credit of the state highway fund. 2-3 (d) In the commission adopted rules, the bidder shall not be 2-4 precluded from submitting a bid guaranty to the department payable 2-5 by cashier's check, money order, or teller's check. 2-6 Sec. 223.015. DEPOSIT AND INVESTMENT OF BID GUARANTY. 2-7 (a) The department may authorize the use of a trust account for 2-8 the purpose of providing a required bid guaranty. 2-9 (b) The guaranty shall be deposited in accordance with a 2-10 trust agreement with a state or nationally chartered financial 2-11 institution that has its main office or a branch office in this 2-12 state and that is selected by the bidder. 2-13 (c) The department shall prescribe a trust agreement that 2-14 protects the interests of this state. 2-15 (d) Interest earned under the trust agreement shall be paid 2-16 to the bidder unless specified otherwise in the trust agreement. 2-17 (e) The applicable financial institution is responsible for 2-18 all amounts resulting from the deposit of the guaranty until 2-19 released from that responsibility in accordance with the trust 2-20 agreement. 2-21 (f) The bidder shall pay all expenses incident to the 2-22 deposit and all charges imposed by the financial institution for 2-23 custody of the guaranties and forwarding of interest on a bid 2-24 guaranty. The expenses may not be included in the bid and are not 2-25 otherwise the responsibility of the state. 2-26 (g) On the request of a bidder, the financial institution 2-27 may reinvest the guaranty amounts in a certificate of deposit or 3-1 another similar instrument prescribed by the trust agreement. The 3-2 certificate of deposit or other instrument must be issued by a 3-3 state or nationally chartered financial institution that has its 3-4 main office or a branch office in this state. 3-5 (h) On the request of a bidder, the financial institution 3-6 shall certify and verify to the department the amount on deposit. 3-7 The trust agreement must specify the method for providing the 3-8 required information. 3-9 SECTION 2. The importance of this legislation and the 3-10 crowded condition of the calendars in both houses create an 3-11 emergency and an imperative public necessity that the 3-12 constitutional rule requiring bills to be read on three several 3-13 days in each house be suspended, and this rule is hereby suspended, 3-14 and that this Act take effect and be in force from and after its 3-15 passage, and it is so enacted.