1-1 By: Staples S.B. No. 221
1-2 (In the Senate - Filed January 11, 2001; January 16, 2001,
1-3 read first time and referred to Committee on State Affairs;
1-4 April 11, 2001, reported adversely, with favorable Committee
1-5 Substitute by the following vote: Yeas 7, Nays 0; April 11, 2001,
1-6 sent to printer.)
1-7 COMMITTEE SUBSTITUTE FOR S.B. No. 221 By: Gallegos
1-8 A BILL TO BE ENTITLED
1-9 AN ACT
1-10 relating to government purchasing using the reverse auction
1-11 procedure.
1-12 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-13 SECTION 1. Section 2155.062, Government Code, is amended by
1-14 amending Subsection (a) and adding Subsection (d) to read as
1-15 follows:
1-16 (a) In purchasing goods and services the commission may use,
1-17 but is not limited to, the:
1-18 (1) contract purchase procedure;
1-19 (2) multiple award contract procedure; [or]
1-20 (3) open market purchase procedure; or
1-21 (4) reverse auction procedure.
1-22 (d) In this section, "reverse auction procedure" means:
1-23 (1) a real-time bidding process usually lasting less
1-24 than one hour and taking place at a previously scheduled time and
1-25 Internet location, in which multiple suppliers, anonymous to each
1-26 other, submit bids to provide the designated goods or services; or
1-27 (2) a bidding process usually lasting less than two
1-28 weeks and taking place during a previously scheduled period and at
1-29 a previously scheduled Internet location, in which multiple
1-30 suppliers, anonymous to each other, submit bids to provide the
1-31 designated goods or services.
1-32 SECTION 2. The heading of Section 252.021, Local Government
1-33 Code, is amended to read as follows:
1-34 Sec. 252.021. COMPETITIVE [BIDDING AND COMPETITIVE PROPOSAL]
1-35 REQUIREMENTS FOR CERTAIN PURCHASES.
1-36 SECTION 3. Subsection (a), Section 252.021, Local Government
1-37 Code, is amended to read as follows:
1-38 (a) Before a municipality may enter into a contract that
1-39 requires an expenditure of more than $15,000 from one or more
1-40 municipal funds, the municipality must:
1-41 (1) comply with the procedure prescribed by this
1-42 chapter for competitive sealed bidding or competitive sealed
1-43 proposals; or
1-44 (2) use the reverse auction procedure, as defined by
1-45 Section 2155.062(d), Government Code, for purchasing.
1-46 SECTION 4. Section 262.023, Local Government Code, is
1-47 amended to read as follows:
1-48 Sec. 262.023. COMPETITIVE [BIDDING AND COMPETITIVE PROPOSAL]
1-49 REQUIREMENTS FOR CERTAIN PURCHASES. (a) Before a county may
1-50 purchase one or more items under a contract that will require an
1-51 expenditure exceeding $25,000, the commissioners court of the
1-52 county must comply with the competitive bidding or competitive
1-53 proposal procedures prescribed by this subchapter or use the
1-54 reverse auction procedure, as defined by Section 2155.062(d),
1-55 Government Code, for purchasing. All competitive bids or
1-56 competitive proposals must be sealed.
1-57 (b) The [competitive bidding and competitive proposal]
1-58 requirements established by Subsection (a) apply only to contracts
1-59 for which payment will be made from current funds or bond funds or
1-60 through time warrants. However, contracts for which payments will
1-61 be made through certificates of obligation are governed by The
1-62 Certificate of Obligation Act of 1971 (Subchapter C, Chapter 271).
1-63 Contracts for which payment will be made through anticipation notes
1-64 are subject to the competitive bidding provisions of The
2-1 Certificate of Obligation Act of 1971 (Subchapter C, Chapter 271)
2-2 in the same manner as certificates of obligation.
2-3 (c) In applying the [competitive bidding and competitive
2-4 proposal] requirements established by Subsection (a), all separate,
2-5 sequential, or component purchases of items ordered or purchased,
2-6 with the intent of avoiding the [competitive bidding and
2-7 competitive proposal] requirements of this subchapter, from the
2-8 same supplier by the same county officer, department, or
2-9 institution are treated as if they are part of a single purchase
2-10 and of a single contract. In applying this provision to the
2-11 purchase of office supplies, separate purchases of supplies by an
2-12 individual department are not considered to be part of a single
2-13 purchase and single contract by the county if a specific intent to
2-14 avoid the [competitive bidding] requirements of this subchapter is
2-15 not present.
2-16 SECTION 5. Subsections (a) and (b), Section 271.083, Local
2-17 Government Code, are amended to read as follows:
2-18 (a) A local government may participate in the purchasing
2-19 program of the commission, including participation in purchases
2-20 that use the reverse auction procedure, as defined by Section
2-21 2155.062(d), Government Code, by filing with the commission a
2-22 resolution adopted by the governing body of the local government
2-23 requesting that the local government be allowed to participate on a
2-24 voluntary basis, and to the extent the commission deems feasible,
2-25 and stating that the local government will:
2-26 (1) designate an official to act for the local
2-27 government in all matters relating to the program, including the
2-28 purchase of items from the vendor under any contract, and that the
2-29 governing body will direct the decisions of the representative;
2-30 (2) be responsible for:
2-31 (A) submitting requisitions to the commission
2-32 under any contract; or
2-33 (B) electronically sending purchase orders
2-34 directly to vendors, or complying with commission procedures
2-35 governing a reverse auction purchase, and electronically sending to
2-36 the commission reports on actual purchases made under this
2-37 paragraph that provide the information and are sent at the times
2-38 required by the commission;
2-39 (3) be responsible for making payment directly to the
2-40 vendor; and
2-41 (4) be responsible for the vendor's compliance with
2-42 all conditions of delivery and quality of the purchased item.
2-43 (b) A local government that purchases an item under a state
2-44 contract or under a reverse auction procedure, as defined by
2-45 Section 2155.062(d), Government Code, sponsored by the commission
2-46 satisfies any state law requiring the local government to seek
2-47 competitive bids for the purchase of the item.
2-48 SECTION 6. Subchapter Z, Chapter 271, Local Government Code,
2-49 is amended by adding Section 271.906 to read as follows:
2-50 Sec. 271.906. REVERSE AUCTION METHOD OF PURCHASING. (a) A
2-51 local government, as defined by Section 271.081, may use the
2-52 reverse auction procedure, as defined by Section 2155.062(d),
2-53 Government Code, in purchasing goods and services in place of any
2-54 other method of purchasing that would otherwise apply to the
2-55 purchase.
2-56 (b) A local government that uses the reverse auction
2-57 procedure must include in the procedure a notice provision and
2-58 other provisions necessary to produce a method of purchasing that
2-59 is advantageous to the local government and fair to vendors.
2-60 SECTION 7. Subsection (a), Section 44.031, Education Code,
2-61 is amended to read as follows:
2-62 (a) Except as provided by this subchapter, all school
2-63 district contracts, except contracts for the purchase of produce or
2-64 vehicle fuel, valued at $25,000 or more in the aggregate for each
2-65 12-month period shall be made by the method, of the following
2-66 methods, that provides the best value for the district:
2-67 (1) competitive bidding;
2-68 (2) competitive sealed proposals;
2-69 (3) a request for proposals, for services other than
3-1 construction services;
3-2 (4) a catalogue purchase as provided by Subchapter B,
3-3 Chapter 2157, Government Code;
3-4 (5) an interlocal contract;
3-5 (6) a design/build contract;
3-6 (7) a contract to construct, rehabilitate, alter, or
3-7 repair facilities that involves using a construction manager; [or]
3-8 (8) a job order contract for the minor construction,
3-9 repair, rehabilitation, or alteration of a facility; or
3-10 (9) the reverse auction procedure as defined by
3-11 Section 2155.062(d), Government Code.
3-12 SECTION 8. This Act takes effect September 1, 2001. The
3-13 changes in law made by this Act apply only to a contract for which
3-14 requests for bids, proposals, or other applicable notice of an
3-15 intent to contract are published or distributed on or after that
3-16 date.
3-17 * * * * *