By Barrientos                                         S.B. No. 1799
         76R7934 JJT-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the performance of a private commercial contractor that
 1-3     provides a service of a state agency.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 2162.103, Government Code, is amended to
 1-6     read as follows:
 1-7           Sec. 2162.103.  COST COMPARISON AND CONTRACT CONSIDERATIONS.
 1-8     (a)  In comparing the cost of providing a service, the council
 1-9     shall conduct and consider the conclusions of cost-benefit analyses
1-10     that compare the costs and benefits of [consider the]:
1-11                 (1)  [cost of] supervising the work of a private
1-12     contractor; [and]
1-13                 (2)  [cost of] a state agency's performance of the
1-14     service, including:
1-15                       (A)  services provided by [the costs of] the
1-16     comptroller, attorney general, and other support agencies; and
1-17                       (B)  other indirect expenses [costs] related to
1-18     the agency's performance of the service; and
1-19                 (3)  improving the state agency's performance by:
1-20                       (A)  the development and implementation of a most
1-21     efficient organization model;
1-22                       (B)  implementing recommendations of the
1-23     comptroller;
1-24                       (C)  implementing recommendations made by the
 2-1     Sunset Advisory Commission; and
 2-2                       (D)  implementing the recommendations of the
 2-3     agency's governing body intended to improve the agency's provision
 2-4     of a service the council identifies under Section 2162.102(a).
 2-5           (b)  The state agency may submit a proposal to the council
 2-6     describing a reorganized service delivery method to compete
 2-7     directly with the performance of a private commercial contractor.
 2-8           (c) [(b)]  A bid or contract must include an analysis of
 2-9     health care benefits, retirement, and workers' compensation
2-10     insurance for a contractor's employees that are reasonably
2-11     comparable to the health care benefits, retirement, and workers'
2-12     compensation insurance of the state.
2-13           (d)  Cost-benefit analyses used for an evaluation under
2-14     Subsection (a) must include a short-term analysis covering a period
2-15     of not more than six months and a long-term analysis covering a
2-16     period of at least one and not more than five years.
2-17           SECTION 2.  Subchapter C, Chapter 2162, Government Code, is
2-18     amended by adding Section 2162.1035 to read as follows:
2-19           Sec. 2162.1035.  AUDIT REQUIREMENTS AND CONTRACT CONDITIONS.
2-20     (a)  A contract awarded to a private commercial contractor must
2-21     include a provision that the continuation of the contract for the
2-22     entire contract period is contingent on the outcome of audits
2-23     conducted under this section.
2-24           (b)  A private commercial contractor to which a contract is
2-25     awarded under this subchapter must cooperate with a compliance
2-26     audit conducted by the state auditor.  The state auditor shall
2-27     conduct the audit not later than the end of the sixth month after
 3-1     the month the contract was awarded.  In conducting the audit, the
 3-2     state auditor shall:
 3-3                 (1)  determine whether the contractor has met the
 3-4     conditions of its contract and cooperated with the audit under this
 3-5     section;
 3-6                 (2)  assess whether the contractor has provided a level
 3-7     of service delivery comparable to that provided by the state agency
 3-8     that most recently provided the service before the service was
 3-9     performed by a private commercial contractor; and
3-10                 (3)  assess whether the cost savings presented in the
3-11     contractor's contract bid are being realized by the contractor.
3-12           (c)  If the state auditor concludes after the audit that the
3-13     private commercial contractor has performed satisfactorily, the
3-14     contractor may continue to perform under the contract until the
3-15     state auditor completes a second audit.  The state auditor shall
3-16     conduct the second audit not before the end of the sixth month
3-17     after the completion of the first audit under this section and not
3-18     later than the 18th month after that audit is completed.
3-19           (d)  If the state auditor concludes after the initial or
3-20     second audit conducted under this section that the contractor has
3-21     not performed satisfactorily, the contract with the private
3-22     commercial contractor terminates immediately and the state agency
3-23     that most recently provided the service before the service was
3-24     performed by a private commercial contractor shall provide the
3-25     service.
3-26           (e)  If a service obligation is returned to the state agency
3-27     under Subsection (d):
 4-1                 (1)  the state agency immediately shall complete a
 4-2     performance evaluation to design a program to improve the delivery
 4-3     of the service and implement the program designed; and
 4-4                 (2)  until the end of the sixth month after the month
 4-5     the contract terminated under Subsection (d), the council may not:
 4-6                       (A)  require the service to be submitted to
 4-7     competitive bidding; or
 4-8                       (B)  make a determination regarding the service
 4-9     under Section 2162.102(b).
4-10           SECTION 3.  This Act takes effect September 1, 1999.
4-11           SECTION 4.  The importance of this legislation and the
4-12     crowded condition of the calendars in both houses create an
4-13     emergency and an imperative public necessity that the
4-14     constitutional rule requiring bills to be read on three several
4-15     days in each house be suspended, and this rule is hereby suspended.