H.B. 2091 78(R)    BILL ANALYSIS


H.B. 2091
By: Harper-Brown
Transportation
 Committee Report (Unamended)


BACKGROUND AND PURPOSE 

Under current law, transportation authorities operating under Chapter 452
of the Transportation Code are not specifically permitted to use the
internet for the electronic transmission of bids and proposals because
such bids are required to be sealed. The use of electronic bidding by
governmental entities is on the rise, and is generally recognized as a
cost-effective and efficient way to streamline the bid process while
providing a paper-free option to vendors.  

The 77th Legislature passed several bills allowing state agencies,
municipalities and cities to participate in "e-procurement."
Additionally, transportation authorities do not have specific statutory
authority to conduct reverse auctions for the purchase of goods or
services. Reverse auctions are a form of competitive bidding whereby the
buyer announces the product it wants to buy and prospective sellers bid
against each other for the lowest offering price.  The Internet makes real
time reverse auctions possible, allowing prospective sellers to enter
continuous bids over a period of several hours until the lowest bid is
reached. In December 2000, the Texas Attorney General issued opinion  JC
-0316 that required specific statutory authority to use the reverse
auction procedure.  

House Bill 2091 authorizes transportation authorities operating under
Chapter 452 (Dallas Area Rapid Transit and Fort Worth Transportation
Authority) to use the Internet to transmit bids and proposals and use
reverse auctions to purchase goods and services. 

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any
additional rulemaking authority to a state officer, department, agency, or
institution. 

ANALYSIS

SECTION 1.  Amends Section 452.106, Transportation Code by amending
subsection (a) and adding subsection (c) as follows: 
 Authorizes the executive committee to adopt procurement procedures,
guidelines and rules that provide for the electronic transmission of bids
and proposals and   the use of reverse auction procedure. 
(c)   requires procedures, guidelines and rules covering electronic
transmission of bids and proposals to provide:  (1) for the
identification, security, and confidentiality of an electronic bid or
propsal (2) that an electronic bid is or proposal is not required to be
sealed; and (3) that an electronic bid or proposal remains effectively
unopened until the appropriate time.  
 SECTION 2.  Amends Section Section 452.107(a), Transportation Code, by
adding language to include the "reverse auction procedure" to the
authority's currently accepted methods of sealed bids or proposals when
awarding a contract for construction, services, or property.  
       SECTION 3.  Changes in law would only apply to procurement after
September 1, 2003 and that bids or proposals before September 1, 2003 is
governed by the law as it existed before September 1, 2003.  
EFFECTIVE DATE

 September 1, 2003