By: Madla S.B. No. 1268
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a surety bond obtained for a public project and
1-3 executed by a surety company.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Subsection (b), Section 2166.258, Government
1-6 Code, is amended to read as follows:
1-7 (b) In accordance with [Notwithstanding] Section 1, Chapter
1-8 87, Acts of the 56th Legislature, Regular Session, 1959 (Article
1-9 7.19-1, Vernon's Texas Insurance Code), the commission or other
1-10 agency may not require a contractor or subcontractor for any public
1-11 building or other construction contract to obtain a surety bond
1-12 from any specific insurance or surety company, agent, or broker.
1-13 To the extent consistent with that law, the commission or other
1-14 agency may require a contractor or subcontractor to meet part or
1-15 all of any other [the bonding or] insurance requirements for the
1-16 project under the negotiated arrangement [negotiated by the
1-17 commission or other agency].
1-18 SECTION 2. Section 2253.021, Government Code, is amended by
1-19 adding Subsection (f) to read as follows:
1-20 (f) A governmental entity may not require a contractor for
1-21 any public building or other construction contract to obtain a
1-22 surety bond from any specific insurance or surety company, agent,
1-23 or broker.
1-24 SECTION 3. (a) This Act takes effect September 1, 2001.
1-25 (b) The change in law made by this Act applies only to a
2-1 contract for a construction project that is made on or after the
2-2 effective date of this Act. A contract that is made before the
2-3 effective date of this Act is governed by the law in effect at the
2-4 time the contract is made, and that law is continued in effect for
2-5 that purpose.