By Carter H.B. No. 2277
77R10943 JAT-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to contracts by certain educational institutions, state
1-3 agencies, and local governments for energy conservation measures.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 44.901(b), (e), (g), (h), and (i),
1-6 Education Code, are amended to read as follows:
1-7 (b) A contract to which this section applies includes a
1-8 contract for the installation or implementation of:
1-9 (1) insulation of the building structures and systems
1-10 within the building;
1-11 (2) storm windows or doors, caulking or
1-12 weatherstripping, multiglazed windows or doors, heat absorbing or
1-13 heat reflective glazed and coated window or door systems, or other
1-14 window or door system modifications that reduce energy consumption;
1-15 (3) automatic energy control systems, including
1-16 computer software and technical data licenses;
1-17 (4) heating, ventilating, or air-conditioning system
1-18 modifications or replacements;
1-19 (5) lighting fixtures that increase energy efficiency;
1-20 (6) energy recovery systems;
1-21 (7) electric systems improvements; or
1-22 (8) other energy conservation-related improvements or
1-23 equipment, [(]including improvements or equipment relating to
1-24 renewable energy[)].
2-1 (e) Before entering into a contract for energy conservation
2-2 measures, the board shall require the provider of the energy
2-3 conservation measures to file with the board a payment and
2-4 performance bond relating to the installation of energy
2-5 conservation measures in accordance with Chapter 2253, Government
2-6 Code. The board [that is in an amount the board finds reasonable
2-7 and necessary to protect the interests of the school district and
2-8 that] may also require a separate bond to cover the value of the
2-9 guaranteed savings on the contract [and is conditioned on the
2-10 faithful execution of the terms of the contract].
2-11 (g) A contract for energy conservation measures shall
2-12 contain provisions pursuant to which the provider of the energy
2-13 conservation measures guarantees the amount of the savings to be
2-14 realized by the school district under the contract. If the term of
2-15 a contract for energy conservation measures exceeds one year, the
2-16 school district's contractual obligations in any one year during
2-17 the term of the contract beginning after the final date of
2-18 installation may not exceed the total energy and operating cost
2-19 savings, including but not limited to electrical, gas, or other
2-20 utility cost savings and operating cost savings resulting from the
2-21 measures [automatic monitoring and control] as determined by the
2-22 school district in this subsection, divided by the number of years
2-23 in the contract term.
2-24 (h) A contract under this section shall [may] be let
2-25 according to the [under competitive proposal] procedures
2-26 established for professional services by Section 2254.004,
2-27 Government Code. Notice of the request for qualifications
3-1 [proposals] shall be published in the manner provided for
3-2 competitive bidding. [Requests for proposals must solicit
3-3 quotations and must specify the relative importance of guaranteed
3-4 savings, price, return on investment, financial performance and
3-5 stability, quality, technical ability, experience, and other
3-6 evaluation factors. The contract shall be awarded to the
3-7 responsible offeror whose proposal, following negotiations, is
3-8 determined to be the most advantageous to the school district
3-9 considering the guaranteed savings and other evaluation factors set
3-10 forth in the request for proposals.]
3-11 [(i) To obtain the best final offers, the school district
3-12 may allow proposal revisions after submissions and before the award
3-13 of the contract.]
3-14 SECTION 2. Sections 51.927(b), (e), (f), and (h)-(l),
3-15 Education Code, are amended to read as follows:
3-16 (b) A contract to which this section applies includes a
3-17 contract for the installation or implementation of:
3-18 (1) insulation of a building structure and systems
3-19 within a building;
3-20 (2) storm windows or [of] doors, caulking or weather
3-21 stripping, multiglazed windows or doors, heat-absorbing or
3-22 heat-reflective glazed and coated window or door systems, or other
3-23 window or door system modifications that reduce energy consumption;
3-24 (3) automatic energy control systems, including
3-25 computer software and technical data licenses;
3-26 (4) heating, ventilating, or air conditioning system
3-27 modifications or replacements;
4-1 (5) lighting fixtures that increase energy efficiency;
4-2 (6) energy recovery systems;
4-3 (7) electric systems improvements; or
4-4 (8) other energy conservation-related improvements or
4-5 equipment, [(]including improvements or equipment related to
4-6 renewable energy[)].
4-7 (e) Before entering into a contract for energy conservation
4-8 measures, the board shall require the provider of the energy
4-9 conservation measures to file with the board a payment and
4-10 performance bond in accordance with Chapter 2253, Government Code.
4-11 The board may also require a separate bond to cover the value of
4-12 the guaranteed savings on [that is in an amount the board finds
4-13 reasonable and necessary to protect the interests of the
4-14 institution and is conditioned on the faithful execution of the
4-15 terms of] the contract.
4-16 (f) The board may enter into a contract for a period of more
4-17 than one year for energy conservation measures with an entity if
4-18 the board finds that the amount the institution would spend on the
4-19 energy conservation measures will not exceed the amount to be saved
4-20 in energy and operating costs over 15 years from the date of
4-21 installation. If the term of a contract for energy conservation
4-22 measures exceeds one year, the board's contractual obligation in
4-23 any year during the term of the contract beginning after the final
4-24 date of installation may not exceed the total energy and operating
4-25 cost savings, including but not limited to electrical, gas, or
4-26 other utility cost savings and operating cost savings resulting
4-27 from the measures [automatic monitoring and control], as determined
5-1 by the board in this subsection, divided by the number of years in
5-2 the contract term beginning after the final date of installation.
5-3 The board shall consider all costs of the energy conservation
5-4 measures, including costs of design, engineering, installation,
5-5 maintenance, repairs, and debt service.
5-6 (h) A contract for energy conservation measures shall
5-7 contain provisions pursuant to which the provider of the energy
5-8 conservation measures guarantees the amount of the savings to be
5-9 realized by the institution of higher education under the contract.
5-10 The Master Equipment Lease Purchase Program operated by the Texas
5-11 Public Finance Authority may be utilized by an institution to fund
5-12 a contract for energy conservation measures so long as the costs of
5-13 the energy conservation measures, including costs of design,
5-14 engineering, installation, [maintenance, repairs,] and anticipated
5-15 debt service requirements of the Master Equipment Lease Purchase
5-16 Program, do not exceed the total energy and operating cost savings,
5-17 as described in Subsection (f), beginning after the final date of
5-18 installation.
5-19 (i) A contract under this section shall [may] be let
5-20 according to the [under competitive sealed proposal] procedures
5-21 established for professional services by Section 2254.004,
5-22 Government Code. Notice of the request for qualifications
5-23 [proposals] shall be given in the manner provided for under Section
5-24 2156.002 [in Chapter 2156], Government Code. The Texas Higher
5-25 Education Coordinating Board, in consultation with the State Energy
5-26 Conservation Office [and the Texas Energy Coordination Council]
5-27 with regard to energy conservation measures, shall establish
6-1 guidelines and an approval process for contracts awarded under this
6-2 section. The guidelines must require that the cost savings
6-3 projected by an offeror be reviewed by a licensed professional
6-4 engineer who is not an officer or employee of an offeror for the
6-5 contract under review or otherwise associated with the contract. An
6-6 engineer who reviews a contract shall maintain the confidentiality
6-7 of any proprietary information the engineer acquires while
6-8 reviewing the contract. A contract is not required to be reviewed
6-9 or approved by the State Energy Conservation Office [or Texas
6-10 Energy Coordination Council]. Section 19, The Texas Engineering
6-11 Practice Act (Article 3271a, Vernon's Texas Civil Statutes),
6-12 applies to work performed under the contract. [The contract shall
6-13 be awarded to the responsible offeror whose proposal, following
6-14 negotiations, is determined by the institution to be the most
6-15 advantageous to the institution considering the guaranteed savings
6-16 and other evaluation factors set forth in the request for
6-17 proposals, except that if the institution finds that no offer is
6-18 acceptable, it shall refuse all offers.]
6-19 (j) [In accordance with regulations adopted by the
6-20 institution, the institution may conduct discussions with offerors
6-21 who submit proposals and who are determined to be reasonably
6-22 qualified for the award of the contract. Offerors shall be treated
6-23 fairly and equally with respect to any opportunity for discussion
6-24 and revision of proposals. To obtain the best final offers, the
6-25 institution may allow proposal revisions after submissions and
6-26 before the award of the contract.]
6-27 [(k) If provided in a request for proposals under Subsection
7-1 (i), proposals shall be opened in a manner that avoids disclosure
7-2 of the contents to competing offerors and keeps the proposals
7-3 secret during negotiations. All proposals are open for public
7-4 inspection after a contract is awarded unless the information is
7-5 excepted from disclosure under Chapter 552, Government Code.]
7-6 [(l)] The legislature shall base an institution's
7-7 appropriation for energy costs during a fiscal year on the sum of:
7-8 (1) the institution's estimated energy costs for that
7-9 fiscal year; and
7-10 (2) if a contract under this section is in effect, the
7-11 institution's estimated net savings resulting from the contract
7-12 during the contract term, divided by the number of years in the
7-13 contract term.
7-14 SECTION 3. Sections 2166.406(b), (e), and (g)-(m), Government
7-15 Code, are amended to read as follows:
7-16 (b) A contract authorized under this section includes a
7-17 contract for the installation or implementation of:
7-18 (1) insulation of the building structure and systems
7-19 within the building;
7-20 (2) storm windows or doors, caulking or weather
7-21 stripping, multiglazed windows or doors, heat absorbing or heat
7-22 reflective glazed and coated window or door systems, or other
7-23 window or door system modifications that reduce energy consumption;
7-24 (3) automatic energy control systems, including
7-25 computer software and technical data licenses;
7-26 (4) heating, ventilating, or air-conditioning system
7-27 modifications or replacements;
8-1 (5) lighting fixtures that increase energy efficiency;
8-2 (6) energy recovery systems;
8-3 (7) electric systems improvements; or
8-4 (8) other energy conservation-related improvements or
8-5 equipment, [(]including improvements or equipment related to
8-6 renewable energy[)].
8-7 (e) Before entering into a contract for energy conservation
8-8 measures, the governing body of the state agency shall require the
8-9 provider of the energy conservation measures to file with the
8-10 governing body a payment and performance bond in accordance with
8-11 Chapter 2253. The governing body may also require a separate bond
8-12 to cover the value of the guaranteed savings on [that is in an
8-13 amount the governing body finds reasonable and necessary to protect
8-14 the interests of the state agency and that is conditioned on the
8-15 faithful execution of the terms of] the contract.
8-16 (g) Energy conservation measures with respect to existing
8-17 buildings or facilities may be financed:
8-18 (1) under a lease/purchase contract that has a term
8-19 not to exceed 15 years from the final date of installation and that
8-20 meets federal tax requirements for tax-free municipal leasing or
8-21 long-term financing, including a lease/purchase contract under the
8-22 Master Equipment Lease Purchase Program administered by the Texas
8-23 Public Finance Authority;
8-24 (2) with the proceeds of bonds; or
8-25 (3) under a contract with the provider of the energy
8-26 conservation measures that has a term not to exceed 15 years from
8-27 the final date of installation.
9-1 (h) A contract for energy conservation measures shall
9-2 contain provisions pursuant to which the provider of the energy
9-3 conservation measures guarantees the amount of the savings to be
9-4 realized by the state agency under the contract. If the term of a
9-5 contract for energy conservation measures exceeds one year, the
9-6 agency's contractual obligation, including costs of design,
9-7 engineering, installation, and anticipated debt service, in any
9-8 year during the term of the contract beginning after the final date
9-9 of installation may not exceed the total energy and operating cost
9-10 savings, including but not limited to electrical, gas, or other
9-11 utility cost savings and operating cost savings resulting from the
9-12 measures [automatic monitoring and control], as determined by the
9-13 state agency in this subsection, divided by the number of years in
9-14 the contract term.
9-15 (i) A contract under this section shall [may] be let
9-16 according to the [under competitive sealed proposal] procedures
9-17 established for professional services by Section 2254.004. Notice
9-18 of the request for qualifications [proposals] shall be given in the
9-19 manner provided for under Section 2156.002 [in Chapter 2156]. The
9-20 State Energy Conservation Office shall establish guidelines and an
9-21 approval process for contracts awarded under this section. The
9-22 guidelines adopted under this subsection must require that the cost
9-23 savings projected by an offeror be reviewed by a licensed
9-24 professional engineer who is not an officer or employee of an
9-25 offeror for the contract under review or otherwise associated with
9-26 the contract. An engineer who reviews a contract shall maintain
9-27 the confidentiality of any proprietary information the engineer
10-1 acquires while reviewing the contract. Section 19, The Texas
10-2 Engineering Practice Act (Article 3271a, Vernon's Texas Civil
10-3 Statutes), applies to work performed under the contract. [Before
10-4 awarding the contract, the state agency shall submit the selected
10-5 proposal to the State Energy Conservation Office and the Texas
10-6 Energy Coordination Council for review and comment before awarding
10-7 the contract. The State Energy Conservation Office and the Texas
10-8 Energy Coordination Council will provide a cost-benefit analysis of
10-9 the proposals and an analysis of the guaranteed savings projected
10-10 by offerors and may charge a fee for this service. The contract
10-11 shall be awarded to the responsible offeror whose proposal,
10-12 following negotiations, is determined to be the most advantageous
10-13 to the state agency considering the savings and other evaluation
10-14 factors set forth in the request for proposals except that if the
10-15 state agency finds that no offer is acceptable, it shall refuse all
10-16 offers.]
10-17 (j) [In accordance with regulations adopted by the state
10-18 agency, the state agency may conduct discussions with offerors who
10-19 submit proposals and who are determined to be reasonably qualified
10-20 for the award of the contract. Offerors shall be treated fairly and
10-21 equally with respect to any opportunity for discussion and revision
10-22 of proposals.]
10-23 [(k) If provided in a request for proposals, proposals shall
10-24 be opened in a manner that avoids disclosure of the contents to
10-25 competing offerors and keeps the proposals secret during
10-26 negotiations. All proposals are open for public inspection after a
10-27 contract is awarded unless the information is excepted from
11-1 disclosure under Chapter 552.]
11-2 [(l) To obtain the best final offers, the state agency may
11-3 allow proposal revisions after submissions and before the award of
11-4 the contract. Final review and approval of the contract will be
11-5 provided by the State Energy Conservation Office.]
11-6 [(m)] The legislature shall base an agency's appropriation
11-7 for energy costs during a fiscal year on the sum of:
11-8 (1) the agency's estimated energy costs for that
11-9 fiscal year; and
11-10 (2) if a contract under this section is in effect, the
11-11 agency's estimated net savings resulting from the contract during
11-12 the contract term, divided by the number of years in the contract
11-13 term.
11-14 SECTION 4. Section 302.002(b), Local Government Code, is
11-15 amended to read as follows:
11-16 (b) A contract authorized under this chapter includes a
11-17 contract for the installation or implementation of:
11-18 (1) insulation of the building structure and systems
11-19 within the building;
11-20 (2) storm windows or doors, caulking or weather
11-21 stripping, multiglazed windows or doors, heat-absorbing or
11-22 heat-reflective glazed and coated window or door systems, or other
11-23 window or door system modifications that reduce energy consumption;
11-24 (3) automatic energy control systems, including
11-25 computer software and technical data licenses;
11-26 (4) heating, ventilating, or air conditioning system
11-27 modifications or replacements;
12-1 (5) lighting fixtures that increase energy efficiency;
12-2 (6) energy recovery systems;
12-3 (7) electric systems improvements; or
12-4 (8) other energy-conservation-related improvements or
12-5 equipment, [(]including improvements or equipment related to
12-6 renewable energy[)].
12-7 SECTION 5. Section 302.003, Local Government Code, is amended
12-8 to read as follows:
12-9 Sec. 302.003. PAYMENT AND PERFORMANCE BOND. Notwithstanding
12-10 any other law to the contrary, before entering into a contract for
12-11 energy conservation measures, the governing body of the local
12-12 government shall [may, at its option:]
12-13 [(1)] require the provider of the energy conservation
12-14 measures to file with the governing body a payment and performance
12-15 bond relating to the installation of energy conservation measures
12-16 in accordance with Chapter 2253, Government Code. The governing
12-17 body may also require a separate bond to [that is in an amount the
12-18 governing body finds reasonable and necessary to protect the
12-19 interests of the local government and that may also] cover the
12-20 value of the guaranteed savings on the contract [and is conditioned
12-21 on the faithful execution of the terms of the contract; or]
12-22 [(2) choose not to require a payment and performance
12-23 bond in connection with the contract].
12-24 SECTION 6. Section 302.004, Local Government Code, is amended
12-25 to read as follows:
12-26 Sec. 302.004. METHOD OF FINANCING; TERMS OF CONTRACT. (a)
12-27 Energy conservation measures with respect to [existing] buildings
13-1 or facilities may be financed:
13-2 (1) under a lease-purchase contract that has a term
13-3 not to exceed 15 years from the final date of installation and that
13-4 meets federal tax requirements for tax-free municipal leasing or
13-5 long-term financing;
13-6 (2) with the proceeds of bonds; or
13-7 (3) under a contract with the provider of the energy
13-8 conservation measures that has a term not to exceed 15 years from
13-9 the final date of installation.
13-10 (b) The contract shall contain provisions pursuant to which
13-11 the provider of the energy conservation measures guarantees the
13-12 amount of the savings to be realized by the local government under
13-13 the contract. If the term of a contract for energy conservation
13-14 measures exceeds one year, the local government's contractual
13-15 obligations in any one year during the term of the contract
13-16 beginning after the final date of installation may not exceed the
13-17 total energy and operating cost savings, including but not limited
13-18 to electrical, gas, or other utility cost savings and operating
13-19 cost savings resulting from the measures [automatic monitoring and
13-20 control] as determined by the local government in this subsection,
13-21 divided by the number of years in the contract term.
13-22 SECTION 7. Section 302.005, Local Government Code, is amended
13-23 to read as follows:
13-24 Sec. 302.005. BIDDING PROCEDURES; AWARD OF CONTRACT. [(a)]
13-25 A contract under this chapter shall [may] be let in accordance with
13-26 the [under competitive proposal] procedures established for
13-27 professional services by Section 2254.004, Government Code. Notice
14-1 of the request for qualifications [proposals] shall be published in
14-2 the manner provided for competitive bidding. [Requests for
14-3 proposals must solicit quotations and must specify the relative
14-4 importance of guaranteed savings, price, return on investment,
14-5 financial performance and stability, quality, technical ability,
14-6 experience, and other evaluation factors.]
14-7 [(b) The contract shall be awarded to the responsible
14-8 offeror whose proposal, following negotiations, is determined to be
14-9 the most advantageous to the local government considering the
14-10 guaranteed savings and other evaluation factors set forth in the
14-11 request for proposals.]
14-12 [(c) To obtain the best final offers, the local government
14-13 may allow proposal revisions after submissions and before the award
14-14 of the contract.]
14-15 SECTION 8. This Act takes effect September 1, 2001, and
14-16 applies only to a contract entered into by an educational
14-17 institution, state agency, or local government on or after that
14-18 date. A contract entered into by an educational institution, state
14-19 agency, or local government before the effective date of this Act
14-20 is covered by the law in effect on the date the contract was
14-21 entered into, and the former law is continued in effect for that
14-22 purpose.