By Longoria                                           H.B. No. 2962
         77R6978 BDH-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to obtaining bonds and insurance required for certain
 1-3     state construction projects.
 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-5           SECTION 1.  Section 2166.258, Government Code, is amended to
 1-6     read as follows:
 1-7           Sec. 2166.258.  COMMON SURETY OR INSURER.  (a)  The
 1-8     commission and each [or an] agency whose project is exempted from
 1-9     all or part of this chapter under Section 2166.003 shall jointly or
1-10     separately enter into a competitively bid contract [may negotiate
1-11     an arrangement advantageous to the state] with a surety or an
1-12     insurer, as appropriate, authorized to do business in this state
1-13     and with experience in surety bond support services, under which
1-14     the surety or insurer shall aggressively assist historically
1-15     underutilized businesses and small businesses to obtain the bonds
1-16     or insurance required to qualify for a contract or subcontract on a
1-17     project administered by the commission or other agency [to furnish
1-18     bonds, insurance, or both that a contractor or subcontractor is
1-19     required to execute or carry to receive a contract or subcontract
1-20     on a project administered by the commission or other agency].
1-21           (b)  Notwithstanding Section 1, Chapter 87, Acts of the 56th
1-22     Legislature, Regular Session, 1959 (Article 7.19-1, Vernon's Texas
1-23     Insurance Code), the commission and an [or other] agency whose
1-24     project is exempted from all or part of this chapter under Section
 2-1     2166.003 shall [may] require a contractor or subcontractor to meet
 2-2     part or all of the bonding or insurance requirements for the
 2-3     project under the contract entered into under Subsection (a)
 2-4     [arrangement negotiated] by the commission or other agency.
 2-5           (c)  A contract under Subsection (a) must:
 2-6                 (1)  be renewed at least once each state fiscal
 2-7     biennium;
 2-8                 (2)  require the surety or insurer to aggressively take
 2-9     steps to furnish assistance for obtaining bonds, insurance, or both
2-10     to historically underutilized businesses and small businesses; and
2-11                 (3)  provide that the surety's or insurer's performance
2-12     under the contract will be evaluated at least in part on the basis
2-13     of the number of historically underutilized businesses, small
2-14     businesses, and other businesses that obtain the required bonds,
2-15     insurance, or both from the contractor.
2-16           (d)  The commission or other state agency entering into a
2-17     contract with  a surety or insurer under Subsection (a) shall
2-18     conduct annual program audits and performance reviews under the
2-19     contract.
2-20           SECTION 2.  This Act takes effect September 1, 2001. The
2-21     change in law made by this Act does not affect a contract entered
2-22     into between a state agency and a surety or an insurer under
2-23     Section 2166.258, Government Code, that is in force on that date
2-24     during the term of the contract, but the renewal of the contract
2-25     must comply with Section 2166.258, Government Code, as amended by
2-26     this Act.