By: Ogden S.B. No. 514
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the payment and use of a bid guaranty for a state
1-2 highway improvement contract.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter A, Chapter 223, Transportation Code,
1-5 is amended by adding Sections 223.014 and 223.015 to read as
1-6 follows:
1-7 Sec. 223.014. BID GUARANTY. (a) The commission shall adopt
1-8 rules on the method by which a bidder may submit a bid guaranty.
1-9 The rules may authorize the use of electronic funds transfer,
1-10 checks, including electronic checks, money orders, escrow accounts,
1-11 trust accounts, and credit cards issued by a financial institution
1-12 chartered by a state or the United States or by a nationally
1-13 recognized credit organization approved by the department. The
1-14 department may require the payment of a discount or service charge
1-15 for the use of a credit card.
1-16 (b) The department may establish one or more escrow accounts
1-17 in the state highway fund for the prepayment of bid guaranties.
1-18 The bid guaranties and any administrative fees established by the
1-19 department for the administration of this subsection shall be
1-20 administered in accordance with an agreement containing terms and
1-21 conditions agreeable to the department. The department shall
1-22 deposit each administrative fee to the credit of the state highway
2-1 fund. The fees may be appropriated only to the department for
2-2 purposes of the administration of this subsection.
2-3 Sec. 223.015. DEPOSIT AND INVESTMENT OF BID
2-4 GUARANTY. (a) The department may authorize the use of a trust
2-5 account for the purpose of providing a required bid guaranty.
2-6 (b) The guaranty will be deposited pursuant to a trust
2-7 agreement with a state or nationally chartered institution
2-8 domiciled in this state and selected by the bidder.
2-9 (c) The department will prescribe a trust agreement that
2-10 protects the interests of the state.
2-11 (d) Interest earned under the trust agreement shall be paid
2-12 to the bidder unless specified otherwise in the trust agreement.
2-13 (e) The financial institution is responsible for all amounts
2-14 resulting from the deposit of the guaranty amounts until released
2-15 from that responsibility under the trust agreement.
2-16 (f) The bidder will pay for expenses incident to the deposit
2-17 and all charges made by the financial institution for custody of
2-18 the guaranties and forwarding of interest on those guaranties.
2-19 Those expenses may not be included in any way in the bid or
2-20 otherwise be the responsibility of the state.
2-21 (g) The financial institution upon instruction by the bidder
2-22 may reinvest the guaranty amounts in a certificate of deposit or
2-23 other similar investment prescribed by the trust agreement. These
2-24 instruments must be issued by a state or nationally chartered
2-25 financial institution domiciled in this state.
2-26 (h) The financial institution must upon request by the
3-1 bidder provide certification and verification of the amount on
3-2 deposit to the department. The trust agreement will specify the
3-3 method for providing the required information.
3-4 SECTION 2. The importance of this legislation and the
3-5 crowded condition of the calendars in both houses create an
3-6 emergency and an imperative public necessity that the
3-7 constitutional rule requiring bills to be read on three several
3-8 days in each house be suspended, and this rule is hereby suspended,
3-9 and that this Act take effect and be in force from and after its
3-10 passage, and it is so enacted.