SRC-JEC H.B. 1138 77(R)   BILL ANALYSIS


Senate Research Center   H.B. 1138
77R297 DRH-DBy: Longoria (Truan)
State Affairs
5/11/2001



This analysis is based on the House Committee Report, which is the most
recent version available to the Senate Research Center. 

DIGEST AND PURPOSE 

Small contractors and historically underutilized businesses often do not
have access to large capital resources. As a result, they often are at a
disadvantage in bidding for state highway improvement contracts which
require small contractors and historically underutilized businesses to
outlay a large percentage of their working capital for a proposal guaranty
in the form of a cashiers check or money order for separate highway
improvement bids.  H.B. 1138 allows a required proposal guaranty to be in
the form of a bid bond.  

RULEMAKING AUTHORITY

Rulemaking authority is expressly granted to the Texas Department of
Transportation in SECTION 1 (Section 223.014, Transportation Code) of this
bill. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Chapter 223A, Transportation Code, by adding Section
223.014, as follows: 

Sec. 223.014.  FORM OF PROPOSAL GUARANTY.  Authorizes a guaranty, if the
Texas Department of Transportation (department) by rule requires a proposal
guaranty as a condition of bidding for a contract, to be in the form of a
cashier's check or money order drawn on a financial entity specified by the
department or a bid bond issued by a surety authorized to do business in
this state. 

SECTION 2.  Effective date: January 1, 2002.