LEGISLATIVE BUDGET BOARD
                              Austin, Texas
                                     
                    FISCAL NOTE, 77th Regular Session
  
                              March 24, 2001
  
  
          TO:  Honorable Bill G. Carter, Chair, House Committee on Urban
               Affairs
  
        FROM:  John Keel, Director, Legislative Budget Board
  
       IN RE:  HB2486  by Clark (Relating to the purchasing and
               contracting authority of municipalities; providing
               penalties.), As Introduced
  
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*  No fiscal implication to the State is anticipated.                    *
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The bill would change the range of limits for expenditures that require
competitive bidding for purchases and contracts, identifying certain
exemptions for use of the competitive bidding process.  The bill would
also provide criteria under which a municipality would not be required
to award a contract to the lowest bidder.  Additionally, under the
provisions of the bill, municipalities would be authorized to conduct or
contract for on-line bidding, including conducting a reverse auction.
  
Local Government Impact
  
A sampling of municipalities contacted indicated that the provisions of
the bill would provide a cost savings.  The savings would vary by
municipality, depending on purchasing needs; however, officials in the
cities of Mesquite and Amarillo both indicated a possible $6,000 savings
annually.
  
  
Source Agencies:   
LBB Staff:         JK, DB