By Luna                                               H.B. No. 1542
         77R2602 BDH-D                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to subcontracting opportunities for historically
 1-3     underutilized businesses.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1. Section 2161.252, Government Code, is amended to
 1-6     read as follows:
 1-7           Sec. 2161.252.  AGENCY DETERMINATION REGARDING SUBCONTRACTING
 1-8     OPPORTUNITIES[; BUSINESS SUBCONTRACTING PLAN]. (a)  Each state
 1-9     agency that considers entering into a contract with an expected
1-10     value of $100,000 or more shall, before the agency solicits bids,
1-11     proposals, offers, or other applicable expressions of interest for
1-12     the contract, determine whether there will be subcontracting
1-13     opportunities under the contract.  If the state agency determines
1-14     that there is that probability, the agency shall require that each
1-15     bid, proposal, offer, or other applicable expression of interest
1-16     for the contract include a historically underutilized business
1-17     subcontracting plan unless the contractor:
1-18                 (1)  is participating or agrees to participate in the
1-19     agency's mentor-protege program under Section 2161.065; and
1-20                 (2)  includes in the contractor's bid, proposal, offer,
1-21     or other applicable expression of interest for the contract a
1-22     statement of intent to subcontract with one or more historically
1-23     underutilized businesses that participate in the mentor-protege
1-24     program.
 2-1           (b)  If a state agency determines under Subsection (a) that
 2-2     there probably will be subcontracting opportunities under a
 2-3     contract [When a state agency requires a historically underutilized
 2-4     business subcontracting plan under Subsection (a)], a bid,
 2-5     proposal, offer, or other applicable expression of interest for the
 2-6     contract must contain a historically underutilized business
 2-7     subcontracting plan or a statement of intent to subcontract under
 2-8     the mentor-protege program to be considered responsive.
 2-9           SECTION 2. Section 2161.253, Government Code, is amended to
2-10     read as follows:
2-11           Sec. 2161.253.  GOOD FAITH COMPLIANCE WITH [BUSINESS]
2-12     SUBCONTRACTING OPPORTUNITIES REQUIREMENT [PLAN]. (a)  When a state
2-13     agency determines [requires a historically underutilized business
2-14     subcontracting plan] under Section 2161.252 that there probably
2-15     will be subcontracting opportunities under a contract, the awarded
2-16     contract shall contain, as a provision of the contract that must be
2-17     fulfilled, the plan or the statement of intent to subcontract with
2-18     one or more historically underutilized businesses under the
2-19     mentor-protege program that the contractor submitted in its bid,
2-20     proposal, offer, or other applicable expression of interest for the
2-21     contract. The contractor shall make good faith efforts to implement
2-22     the plan or subcontract under the mentor-protege program.
2-23           (b)  To the extent that subcontracts are not contracted for
2-24     as originally submitted under Section 2161.252 [in the historically
2-25     underutilized business subcontracting plan], the contractor shall
2-26     report to the state agency all the circumstances that explain that
2-27     fact and describe the good faith efforts made to find and
 3-1     subcontract with another historically underutilized business.
 3-2           (c)  The state agency shall audit the contractor's compliance
 3-3     with the historically underutilized business subcontracting plan or
 3-4     the statement of intent to subcontract with one or more
 3-5     historically underutilized businesses under the mentor-protege
 3-6     program.  In determining whether the contractor made the required
 3-7     good faith effort, the agency may not consider the success or
 3-8     failure of the contractor to subcontract with historically
 3-9     underutilized businesses in any specific quantity.  The agency's
3-10     determination is restricted to considering factors indicating good
3-11     faith.
3-12           (d)  If a determination is made that the contractor failed to
3-13     implement the plan in good faith or to make a good faith effort to
3-14     subcontract under the mentor-protege program, as applicable, the
3-15     agency, in addition to any other remedies, may bar the contractor
3-16     from further contracting opportunities with the agency.
3-17           (e)  The commission shall adopt rules to administer this
3-18     subchapter.
3-19           SECTION 3. This Act takes effect September 1, 2001.