1-1 AN ACT
1-2 relating to government purchasing using the reverse auction
1-3 procedure.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 2155.062, Government Code, is amended by
1-6 amending Subsection (a) and adding Subsection (d) to read as
1-7 follows:
1-8 (a) In purchasing goods and services the commission may use,
1-9 but is not limited to, the:
1-10 (1) contract purchase procedure;
1-11 (2) multiple award contract procedure; [or]
1-12 (3) open market purchase procedure; or
1-13 (4) reverse auction procedure.
1-14 (d) In this section, "reverse auction procedure" means:
1-15 (1) a real-time bidding process usually lasting less
1-16 than one hour and taking place at a previously scheduled time and
1-17 Internet location, in which multiple suppliers, anonymous to each
1-18 other, submit bids to provide the designated goods or services; or
1-19 (2) a bidding process usually lasting less than two
1-20 weeks and taking place during a previously scheduled period and at
1-21 a previously scheduled Internet location, in which multiple
1-22 suppliers, anonymous to each other, submit bids to provide the
1-23 designated goods or services.
1-24 SECTION 2. The heading of Section 252.021, Local Government
1-25 Code, is amended to read as follows:
2-1 Sec. 252.021. COMPETITIVE [BIDDING AND COMPETITIVE PROPOSAL]
2-2 REQUIREMENTS FOR CERTAIN PURCHASES.
2-3 SECTION 3. Subsection (a), Section 252.021, Local Government
2-4 Code, is amended to read as follows:
2-5 (a) Before a municipality may enter into a contract that
2-6 requires an expenditure of more than $15,000 from one or more
2-7 municipal funds, the municipality must:
2-8 (1) comply with the procedure prescribed by this
2-9 chapter for competitive sealed bidding or competitive sealed
2-10 proposals; or
2-11 (2) use the reverse auction procedure, as defined by
2-12 Section 2155.062(d), Government Code, for purchasing.
2-13 SECTION 4. Section 262.023, Local Government Code, is
2-14 amended to read as follows:
2-15 Sec. 262.023. COMPETITIVE [BIDDING AND COMPETITIVE PROPOSAL]
2-16 REQUIREMENTS FOR CERTAIN PURCHASES. (a) Before a county may
2-17 purchase one or more items under a contract that will require an
2-18 expenditure exceeding $25,000, the commissioners court of the
2-19 county must comply with the competitive bidding or competitive
2-20 proposal procedures prescribed by this subchapter or use the
2-21 reverse auction procedure, as defined by Section 2155.062(d),
2-22 Government Code, for purchasing. All competitive bids or
2-23 competitive proposals must be sealed.
2-24 (b) The [competitive bidding and competitive proposal]
2-25 requirements established by Subsection (a) apply only to contracts
2-26 for which payment will be made from current funds or bond funds or
3-1 through time warrants. However, contracts for which payments will
3-2 be made through certificates of obligation are governed by The
3-3 Certificate of Obligation Act of 1971 (Subchapter C, Chapter 271).
3-4 Contracts for which payment will be made through anticipation notes
3-5 are subject to the competitive bidding provisions of The
3-6 Certificate of Obligation Act of 1971 (Subchapter C, Chapter 271)
3-7 in the same manner as certificates of obligation.
3-8 (c) In applying the [competitive bidding and competitive
3-9 proposal] requirements established by Subsection (a), all separate,
3-10 sequential, or component purchases of items ordered or purchased,
3-11 with the intent of avoiding the [competitive bidding and
3-12 competitive proposal] requirements of this subchapter, from the
3-13 same supplier by the same county officer, department, or
3-14 institution are treated as if they are part of a single purchase
3-15 and of a single contract. In applying this provision to the
3-16 purchase of office supplies, separate purchases of supplies by an
3-17 individual department are not considered to be part of a single
3-18 purchase and single contract by the county if a specific intent to
3-19 avoid the [competitive bidding] requirements of this subchapter is
3-20 not present.
3-21 SECTION 5. Subsections (a) and (b), Section 271.083, Local
3-22 Government Code, are amended to read as follows:
3-23 (a) A local government may participate in the purchasing
3-24 program of the commission, including participation in purchases
3-25 that use the reverse auction procedure, as defined by Section
3-26 2155.062(d), Government Code, by filing with the commission a
4-1 resolution adopted by the governing body of the local government
4-2 requesting that the local government be allowed to participate on a
4-3 voluntary basis, and to the extent the commission deems feasible,
4-4 and stating that the local government will:
4-5 (1) designate an official to act for the local
4-6 government in all matters relating to the program, including the
4-7 purchase of items from the vendor under any contract, and that the
4-8 governing body will direct the decisions of the representative;
4-9 (2) be responsible for:
4-10 (A) submitting requisitions to the commission
4-11 under any contract; or
4-12 (B) electronically sending purchase orders
4-13 directly to vendors, or complying with commission procedures
4-14 governing a reverse auction purchase, and electronically sending to
4-15 the commission reports on actual purchases made under this
4-16 paragraph that provide the information and are sent at the times
4-17 required by the commission;
4-18 (3) be responsible for making payment directly to the
4-19 vendor; and
4-20 (4) be responsible for the vendor's compliance with
4-21 all conditions of delivery and quality of the purchased item.
4-22 (b) A local government that purchases an item under a state
4-23 contract or under a reverse auction procedure, as defined by
4-24 Section 2155.062(d), Government Code, sponsored by the commission
4-25 satisfies any state law requiring the local government to seek
4-26 competitive bids for the purchase of the item.
5-1 SECTION 6. Subchapter Z, Chapter 271, Local Government Code,
5-2 is amended by adding Section 271.906 to read as follows:
5-3 Sec. 271.906. REVERSE AUCTION METHOD OF PURCHASING. (a) A
5-4 local government, as defined by Section 271.081, may use the
5-5 reverse auction procedure, as defined by Section 2155.062(d),
5-6 Government Code, in purchasing goods and services in place of any
5-7 other method of purchasing that would otherwise apply to the
5-8 purchase.
5-9 (b) A local government that uses the reverse auction
5-10 procedure must include in the procedure a notice provision and
5-11 other provisions necessary to produce a method of purchasing that
5-12 is advantageous to the local government and fair to vendors.
5-13 SECTION 7. Subsection (a), Section 44.031, Education Code,
5-14 is amended to read as follows:
5-15 (a) Except as provided by this subchapter, all school
5-16 district contracts, except contracts for the purchase of produce or
5-17 vehicle fuel, valued at $25,000 or more in the aggregate for each
5-18 12-month period shall be made by the method, of the following
5-19 methods, that provides the best value for the district:
5-20 (1) competitive bidding;
5-21 (2) competitive sealed proposals;
5-22 (3) a request for proposals, for services other than
5-23 construction services;
5-24 (4) a catalogue purchase as provided by Subchapter B,
5-25 Chapter 2157, Government Code;
5-26 (5) an interlocal contract;
6-1 (6) a design/build contract;
6-2 (7) a contract to construct, rehabilitate, alter, or
6-3 repair facilities that involves using a construction manager; [or]
6-4 (8) a job order contract for the minor construction,
6-5 repair, rehabilitation, or alteration of a facility; or
6-6 (9) the reverse auction procedure as defined by
6-7 Section 2155.062(d), Government Code.
6-8 SECTION 8. Section 36.067, Water Code, is amended by adding
6-9 Subsection (c) to read as follows:
6-10 (c) A district may use the reverse auction procedure, as
6-11 defined by Section 2155.062(d), Government Code, for purchasing.
6-12 SECTION 9. Section 49.273, Water Code, is amended by adding
6-13 Subsection (k) to read as follows:
6-14 (k) The board may use the reverse auction procedure, as
6-15 defined by Section 2155.062(d), Government Code, for purchasing.
6-16 SECTION 10. Section 23, Development Corporation Act of 1979
6-17 (Article 5190.6, Vernon's Texas Civil Statutes), is amended by
6-18 adding Subsection (e) to read as follows:
6-19 (e) A corporation may use the reverse auction procedure, as
6-20 defined by Section 2155.062(d), Government Code, for purchasing.
6-21 SECTION 11. (a) The changes in law made by this Act apply
6-22 only to a contract for which requests for bids, proposals, or other
6-23 applicable notice of an intent to contract are published or
6-24 distributed on or after the effective date of this Act.
6-25 (b) This Act takes effect immediately if it receives a vote
6-26 of two-thirds of all the members elected to each house, as provided
7-1 by Section 39, Article III, Texas Constitution. If this Act does
7-2 not receive the vote necessary for immediate effect, this Act takes
7-3 effect September 1, 2001.
_______________________________ _______________________________
President of the Senate Speaker of the House
I hereby certify that S.B. No. 221 passed the Senate on
April 19, 2001, by the following vote: Yeas 29, Nays 0, one
present, not voting; and that the Senate concurred in House
amendment on May 15, 2001, by the following vote: Yeas 29, Nays 0,
one present, not voting.
_______________________________
Secretary of the Senate
I hereby certify that S.B. No. 221 passed the House, with
amendment, on May 8, 2001, by the following vote: Yeas 147,
Nays 0, two present, not voting.
_______________________________
Chief Clerk of the House
Approved:
_______________________________
Date
_______________________________
Governor