78(R) SB 506 - Introduced version


                                                                                

78R827 SMH-D

By:  Ellis                                                        S.B. No. 506



A BILL TO BE ENTITLED

AN ACT

relating to requiring, as a condition of eligibility to bid on an 
oil, gas, or other mineral lease on certain state land, a plan for 
procuring goods and services from or participating with 
historically underutilized businesses.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter D, Chapter 32, Natural Resources 
Code, is amended by adding Section 32.108 to read as follows:
	Sec. 32.108.  PROCUREMENT FROM OR PARTICIPATION WITH 
HISTORICALLY UNDERUTILIZED BUSINESSES.  (a) In this section, 
"historically underutilized business" has the meaning assigned by 
Section 2161.001, Government Code.
	(b)  To be eligible to bid on an oil, gas, or other mineral 
lease, a person must submit to the board a plan acceptable to the 
board specifying how the person will:
		(1)  procure goods and services from historically 
underutilized businesses; and
		(2)  participate with historically underutilized 
businesses in the production of oil, gas, or other minerals from 
land leased under this subchapter.
	(c)  The lease must contain, as a provision of the lease that 
must be fulfilled, the plan that the lessee submitted before the 
lease sale.  The lessee shall make good faith efforts to implement 
the plan.
	(d)  If the lessee does not implement the plan, the lessee 
shall report to the board all the circumstances that explain that 
fact and describe the good faith efforts made to implement the plan.
	(e)  The board shall audit the lessee's compliance with the 
plan.  If the lessee does not implement the plan, the board shall 
determine whether the lessee made good faith efforts to do so.  In 
determining whether the lessee acted in good faith, the board may 
not consider the success or failure of the lessee in:
		(1)  procuring goods and services in any specific 
quantity from historically underutilized businesses; or
		(2)  participating to any specific extent with 
historically underutilized businesses in the production of oil, 
gas, or other minerals from land leased under this subchapter.
	(f)  If the board determines that the lessee failed to 
implement the plan in good faith, the board, in addition to any 
other remedies, may bar the lessee from bidding at any future lease 
sale held under this subchapter.
	SECTION 2.  Subchapter D, Chapter 66, Education Code, is 
amended by adding Section 66.665 to read as follows:
	Sec. 66.665.  PROCUREMENT FROM OR PARTICIPATION WITH 
HISTORICALLY UNDERUTILIZED BUSINESSES.  (a) In this section, 
"historically underutilized business" has the meaning assigned by 
Section 2161.001, Government Code.
	(b)  To be eligible to bid on an oil and gas lease, a person 
must submit to the board a plan acceptable to the board specifying 
how the person will:
		(1)  procure goods and services from historically 
underutilized businesses; and
		(2)  participate with historically underutilized 
businesses in the production of oil and gas from land leased under 
this subchapter.
	(c)  The lease must contain, as a provision of the lease that 
must be fulfilled, the plan that the lessee submitted before the 
lease sale.  The lessee shall make good faith efforts to implement 
the plan.
	(d)  If the lessee does not implement the plan, the lessee 
shall report to the board all the circumstances that explain that 
fact and describe the good faith efforts made to implement the plan.
	(e)  The board shall audit the lessee's compliance with the 
plan.  If the lessee does not implement the plan, the board shall 
determine whether the lessee made good faith efforts to do so.  In 
determining whether the lessee acted in good faith, the board may 
not consider the success or failure of the lessee in:
		(1)  procuring goods and services in any specific 
quantity from historically underutilized businesses; or
		(2)  participating to any specific extent with 
historically underutilized businesses in the production of oil and 
gas from land leased under this subchapter.
	(f)  If the board determines that the lessee failed to 
implement the plan in good faith, the board, in addition to any 
other remedies, may bar the lessee from bidding at any future lease 
sale held under this subchapter.
	SECTION 3.  Subchapter D, Chapter 85, Education Code, is 
amended by adding Section 85.555 to read as follows:
	Sec. 85.555.  PROCUREMENT FROM OR PARTICIPATION WITH 
HISTORICALLY UNDERUTILIZED BUSINESSES.  (a) In this section, 
"historically underutilized business" has the meaning assigned by 
Section 2161.001, Government Code.
	(b)  To be eligible to bid on an oil, gas, sulphur, mineral 
ore, or other mineral lease, a person must submit to the board a 
plan acceptable to the board specifying how the person will:
		(1)  procure goods and services from historically 
underutilized businesses; and
		(2)  participate with historically underutilized 
businesses in the production of oil, gas, sulphur, mineral ore, or 
other minerals from land leased under this subchapter.
	(c)  The lease must contain, as a provision of the lease that           

must be fulfilled, the plan that the lessee submitted before the 
lease sale.  The lessee shall make good faith efforts to implement 
the plan.
	(d)  If the lessee does not implement the plan, the lessee 
shall report to the board all the circumstances that explain that 
fact and describe the good faith efforts made to implement the plan.
	(e)  The board shall audit the lessee's compliance with the 
plan.  If the lessee does not implement the plan, the board shall 
determine whether the lessee made good faith efforts to do so.  In 
determining whether the lessee acted in good faith, the board may 
not consider the success or failure of the lessee in:
		(1)  procuring goods and services in any specific 
quantity from historically underutilized businesses; or
		(2)  participating to any specific extent with 
historically underutilized businesses in the production of oil, 
gas, sulphur, mineral ore, or other minerals from land leased under 
this subchapter.
	(f)  If the board determines that the lessee failed to 
implement the plan in good faith, the board, in addition to any 
other remedies, may bar the lessee from bidding at any future lease 
sale held under this subchapter.
	SECTION 4.  Subchapter D, Chapter 109, Education Code, is 
amended by adding Section 109.645 to read as follows:
	Sec. 109.645.  PROCUREMENT FROM OR PARTICIPATION WITH 
HISTORICALLY UNDERUTILIZED BUSINESSES.  (a) In this section, 
"historically underutilized business" has the meaning assigned by 
Section 2161.001, Government Code.
	(b)  To be eligible to bid on an oil, gas, sulphur, or other 
mineral lease, a person must submit to the board a plan acceptable 
to the board specifying how the person will:
		(1)  procure goods and services from historically 
underutilized businesses; and
		(2)  participate with historically underutilized 
businesses in the production of oil, gas, sulphur, or other 
minerals from land leased under this subchapter.
	(c)  The lease must contain, as a provision of the lease that           

must be fulfilled, the plan that the lessee submitted before the 
lease sale.  The lessee shall make good faith efforts to implement 
the plan.
	(d)  If the lessee does not implement the plan, the lessee 
shall report to the board all the circumstances that explain that 
fact and describe the good faith efforts made to implement the plan.
	(e)  The board shall audit the lessee's compliance with the 
plan.  If the lessee does not implement the plan, the board shall 
determine whether the lessee made good faith efforts to do so.  In 
determining whether the lessee acted in good faith, the board may 
not consider the success or failure of the lessee in:
		(1)  procuring goods and services in any specific 
quantity from historically underutilized businesses; or
		(2)  participating to any specific extent with 
historically underutilized businesses in the production of oil, 
gas, sulphur, or other minerals from land leased under this 
subchapter.
	(f)  If the board determines that the lessee failed to 
implement the plan in good faith, the board, in addition to any 
other remedies, may bar the lessee from bidding at any future lease 
sale held under this subchapter.
	SECTION 5.  (a) This Act takes effect September 1, 2003.                       
	(b)  The changes in law made by this Act apply only to the 
sale of a lease for oil, gas, or other minerals for which notice is 
given on or after the effective date of this Act.  The sale of a 
lease for oil, gas, or other minerals for which notice was given 
before the effective date of this Act is governed by the law as it 
existed immediately before the effective date of this Act, and that 
law is continued in effect for that purpose.