LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                            February 26, 2001
  
  
          TO:  Honorable Tom Ramsay, Chair, House Committee on County
               Affairs
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB1993  by Marchant (Relating to the threshold contract
               amount at which certain political subdivisions are
               required to engage in a competitive purchasing
               procedure.), As Introduced
  
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*  No fiscal implication to the State is anticipated.                    *
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Local Government Impact
  
Under current statute, municipalities may not enter into a contract
without following rules for competitive bidding or competitive sealed
proposals if the project would cost more than $15,000.  Current law also
requires a municipality to contact at least two historically
underutilized businesses (HUB) for projects that would cost between
$3,000 and $15,000. The bill would change the minimum expenditure
requirement from $15,000 to $25,000 before a municipality would have to
use either bidding process.  Additionally, the bill would increase the
maximum from $15,000 to $25,000 for projects that would require the
municipality to contact at least two HUBs on a rotating basis. The Act
would take effect September 1, 2001.

Municipalities would experience a moderate savings by being able to make
expenditures without the expense of the bidding process for those
projects in the newly opened range of $15,001 and $25,000.
Additionally, there would be no significant fiscal impact resulting from
changing the cost range for projects requiring contacting at least two
HUBs.
  
  
Source Agencies:   304   Comptroller of Public Accounts
LBB Staff:         JK, DB