C.S.H.B. 2899 78(R)    BILL ANALYSIS


C.S.H.B. 2899
By: Phillips
Transportation
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

The logo sign program was created in 1991 to provide motorists with
information regarding food, fuel, and lodging along certain state
highways.  Major shopping area and major agricultural interest area signs
were added to this program in 1997.  The Texas Department of
Transportation (department) is required to enter a contract for management
of the program and installation of signs. 

Because these signs are located along state highways, the necessary
contracts are highway improvement contracts under Chapter 223,
Transportation Code.  As a result, these contracts are subject to
competitive bidding requirements.  Subjecting these contracts to such
requirements has made it difficult for the department to maximize revenue
for the state highway fund.  

Currently, TxDOT receives 5% of all contractor revenue associated with the
fees they receive from program participants.  Many other states receive
much higher rates of return from their logo programs, some as high as 40%.
The department believes that a return of at least 10% is necessary to
cover the state's administrative costs.   

CSHB 2899 allows the Texas Department of Transportation to enter efficient
contracts for the erection of logo, major shopping area, and major
agricultural interest signs.   

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 Chapter 391, Transportation Code, as follows:

Sec. 391.091.  ERECTION AND MAINTENANCE OF SIGNS.  (a)  Requires the
department to enter contracts for the erection and maintenance of logo
signs, major shopping area guide signs, and major agricultural interest
signs. 

(b)  Authorizes the department to award contracts for these programs in
the manner that will provide the best value for the state. 

(c)  Lists factors that may be considered in awarding contracts.

(d)  Provides that this section prevails over conflicting law 

(e)  Provides that Subtitle D, Title 10, Government Code, and Chapter 223,
Transportation Code, do not apply to contracts entered under this section. 

SECTION 2.  Provides that any contractual disputes will be governed by
Section 201.112. 

 SECTION 3.  Repeals  391.097 (b) and (c), Transportation Code.

SECTION 4.  Provides that the change in law applies only to a contract
entered into by the Texas Department of Transportation on or after the
effective date of this Act. 

EFFECTIVE DATE

Upon passage, or, if the Act does not receive the necessary vote, the Act
takes effect September 1, 2003. 

COMPARISON OF ORIGINAL TO SUBSTITUTE

The substitute removes the requirements that a contractor's past
relationship with the department and a contractor's reputation be
specifically considered in the department's determination of the best
value for the state.  The substitute contains other non-substantive
changes as prepared by the Texas Legislative Council.