By:  Madla, Lucio                                     S.B. No. 1404
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to the establishment by the Texas Department of
 1-3     Transportation of a highway construction pilot program that
 1-4     includes a limited pavement warranty.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1.  Chapter 224, Transportation Code, is amended by
 1-7     adding Subchapter G to read as follows:
 1-8              SUBCHAPTER G.  HIGHWAY CONSTRUCTION PILOT PROGRAM
 1-9                       WITH LIMITED PAVEMENT WARRANTY
1-10           Sec. 224.201.  PILOT PROGRAM.  (a)  The department shall
1-11     establish a pilot program for highway construction projects
1-12     involving the use of a limited pavement warranty.
1-13           (b)  Each biennium, the department shall issue requests for
1-14     proposals for two highway construction projects under the pilot
1-15     program.
1-16           Sec. 224.202.  CRITERION.  To be included in the pilot
1-17     program, the estimated total cost of the highway construction
1-18     project must be greater than $15 million.
1-19           Sec. 224.203.  PAVEMENT WARRANTY.  (a)  A contract for a
1-20     highway construction project under the pilot program must include a
1-21     long-term limited pavement warranty.
1-22           (b)  The period of a limited pavement warranty may not be
1-23     less than 15 years.
1-24           Sec. 224.204.  TERMS OF PAVEMENT WARRANTY.  A limited
1-25     pavement warranty under Section 224.203 must specify:
 2-1                 (1)  the responsibilities of the warranty provider;
 2-2                 (2)  the responsibilities of the department;
 2-3                 (3)  the terms of the warranty, including time and
 2-4     traffic;
 2-5                 (4)  performance criteria to be met to determine if
 2-6     maintenance is required; and
 2-7                 (5)  other specifications as necessary for the
 2-8     particular construction project.
 2-9           Sec. 224.205.  WARRANTY PROVISIONS.  In connection with a
2-10     warranty for a highway project constructed under the pilot program,
2-11     the contract for the project must include:
2-12                 (1)  a mitigation plan to account for inflation during
2-13     the warranty period;
2-14                 (2)  provisions relating to:
2-15                       (A)  the frequency of performance assessments;
2-16     and
2-17                       (B)  the response time for repairs;
2-18                 (3)  a plan for emergency repairs;
2-19                 (4)  clearly set out limits of liability under the
2-20     warranty, if any;
2-21                 (5)  dispute resolution provisions;
2-22                 (6)  a severability provision; and
2-23                 (7)  other provisions considered necessary for the
2-24     particular construction project.
2-25           Sec. 224.206.  INNOVATIONS BY WARRANTY PROVIDER.  (a)  A
2-26     warranty for a highway construction project under the pilot program
 3-1     must allow for innovation by the warranty provider.
 3-2           (b)  The terms of a warranty must allow the warranty provider
 3-3     to modify the department's standard specifications for pavement
 3-4     design, material mix design, and quality assurance and quality
 3-5     control.
 3-6           Sec. 224.207.  CONFLICTS.  To the extent of a conflict with
 3-7     another law relating to the letting of a contract for a highway
 3-8     construction project by the department, or to the terms or
 3-9     conditions of a contract for a highway construction project entered
3-10     into by the department, this subchapter prevails.
3-11           Sec. 224.208.  REPORT TO LEGISLATURE.  Not later than
3-12     February 1 of each odd-numbered year, the department shall submit a
3-13     report to the legislature relating to highway construction projects
3-14     under this subchapter during the preceding two years.  The report
3-15     may include recommendations on the continuation or expansion of the
3-16     pilot program.
3-17           SECTION 2.  This Act takes effect September 1, 2001.