79R3421 MTB-D

By:  Isett                                                        H.B. No. 2247


A BILL TO BE ENTITLED
AN ACT
relating to state contract management, including the training of personnel, the negotiation of contracts, and the standardization of practices. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Subchapter D, Chapter 551, Government Code, is amended by adding Section 551.0726 to read as follows: Sec. 551.0726. GOVERNING BODY OF STATE AGENCY: DELIBERATION REGARDING CONTRACT BEING NEGOTIATED; CLOSED MEETING. (a) In this section, "state agency" means a department, board, commission, or other agency in the executive branch of state government. (b) The governing body of a state agency may conduct a closed meeting to deliberate business and financial issues relating to a contract being negotiated if, before conducting the closed meeting: (1) the governing body votes unanimously that deliberation in an open meeting would have a detrimental effect on the position of the state in negotiations with a third person; and (2) the attorney advising the governing body issues a written determination that deliberation in an open meeting would have a detrimental effect on the position of the state in negotiations with a third person. (c) Notwithstanding Section 551.103(a), the governing body must make a tape recording of the proceedings of a closed meeting held under this section. SECTION 2. Section 2155.078, Government Code, is amended by adding Subsection (o) to read as follows: (o) In addition to the three levels of training provided by this section, the commission shall develop and implement a continuing education course on cost analysis and price negotiation. State agency purchasing personnel who attend the course shall review the course and provide the review to the commission. SECTION 3. Subchapter B, Chapter 2155, Government Code, is amended by adding Section 2155.0785 to read as follows: Sec. 2155.0785. WORKING GROUP. (a) The commission shall form a working group of representatives of state agencies: (1) to review the training programs administered under Sections 2155.078 and 2262.053; and (2) to offer recommendations to the commission on improvements and modifications to the training programs. (b) The working group shall meet annually at a time designated by the commission. (c) A representative of a state agency that takes part in the working group established under this section shall report to the governing body of the represented state agency on the efforts of the working group. SECTION 4. Subchapter B, Chapter 2155, Government Code, is amended by adding Section 2155.085 to read as follows: Sec. 2155.085. REPORT ON CERTAIN PURCHASES. (a) Not later than August 1 of each year, the commission shall publish a report on the number and dollar value of sole source purchases made and open market purchases made or contracts awarded for which there were fewer than three responses to the contract or open market solicitation in the previous calendar year. The report must compare the total dollar value of all sole source purchases made and all open market purchases made or contracts awarded for which there were fewer than three responses to the contract or open market solicitation with the total dollar value of all competitively awarded contracts and open market purchases for which there were three or more responses to the contract or open market solicitation. (b) Each state agency shall timely provide the commission with the information the commission requires for the purpose of creating the report under Subsection (a). SECTION 5. Section 2262.001, Government Code, is amended by adding Subdivision (3-a) to read as follows: (3-a) "Department" means the Department of Information Resources. SECTION 6. Section 2262.053, Government Code, is amended by adding Subsections (e) and (f) to read as follows: (e) The commission shall establish minimum qualifications for certifying contract managers. The minimum standards must require completion of the contract management training required under this section and Section 2155.078. (f) The commission shall develop guidelines by which a state agency is required to involve a contract manager during various stages of the contracting process based on the size of the contract and the risk associated with the contract. SECTION 7. Subchapter B, Chapter 2262, Government Code, is amended by adding Sections 2262.065-2262.067 to read as follows: Sec. 2262.065. PERFORMANCE MEASURES. Each state agency shall develop a plan for incorporating performance measures into an appropriate percentage of contracts for services entered into by the agency. The agency shall determine the appropriate percentage in consultation with the commission. Sec. 2262.066. INFORMATION-SHARING PORTAL. The commission and department shall jointly: (1) review the options for establishing an information-sharing portal for use by state agencies in contract management and administration; and (2) if the commission and department determine that establishing the portal is cost-effective, establish the portal. Sec. 2262.067. UNIFORM DEFINITIONS AND CONTRACT LIBRARY. (a) The commission shall develop and publish a uniform set of definitions for use as applicable in state contracts. (b) The commission shall develop and publish a uniform and automated set of forms, including sample contracts and contract terms, for use in the different stages of the contracting process. SECTION 8. Chapter 2262, Government Code, is amended by adding Subchapter G to read as follows:
SUBCHAPTER G. CONTRACT MANAGEMENT OF MAJOR CONTRACTS
Sec. 2262.301. DEFINITION. In this subchapter, "quality assurance team" means the quality assurance team established under Section 2054.158. Sec. 2262.302. APPLICABILITY. This subchapter applies only to a major contract. Sec. 2262.303. GUIDELINES; FORMS. (a) A state agency shall prepare each document required by this subchapter in a manner consistent with department guidelines. (b) The commission, in consultation with the department, shall develop and provide guidelines and forms for the documents required by this subchapter. (c) The commission, in consultation with the department, shall work with state agencies in developing the guidelines and forms. Sec. 2262.304. BUSINESS CASE. (a) For each proposed major contract, a state agency must prepare a business case providing the initial justification for the contract, including the anticipated return on investment in terms of cost savings and efficiency for the contract. (b) The agency shall file the document with the commission and the Legislative Budget Board at the same time the agency files its legislative appropriations request. Sec. 2262.305. PROJECT PLANS. (a) For each major contract, a state agency shall develop a project plan for the project to which the major contract relates. (b) Except as provided by Subsection (c), the state agency must file the project plan with the quality assurance team before the agency: (1) spends more than 10 percent of allocated funds for the related major contract; or (2) first issues a contractor solicitation for the related major contract. (c) The commission may not issue a contractor solicitation for the contract unless the project plan has been filed under this section. (d) The project plan must include: (1) a procurement plan with anticipated service levels and performance standards for each contractor; and (2) a method for monitoring changes to the scope of a contract. Sec. 2262.306. INDEPENDENT VALIDATION AND VERIFICATION. (a) A state agency shall budget for and incorporate an independent validation and verification plan with the project plan required under Section 2262.305. (b) The commission, in consultation with the department, shall establish standards for: (1) validation services provided by contractors; and (2) validation services provided by state agencies, including standards regarding commission approval of agency-provided validation services. (c) If a state agency decides to perform validation services for its own contract, the agency's validation services providers must operate independently from the agency's contracting teams. (d) In addition to the plan required under Subsection (a), a state agency shall periodically submit an independent validation and verification report to the agency's executive director and to the commission. The commission shall determine the frequency and content of the report in its guidelines. Sec. 2262.307. CONTRACT REVIEW. (a) After a major contract is completed or otherwise terminated, a state agency shall prepare a review of the contractor's performance. The agency shall provide the review to the agency's executive director and to the department. (b) The department shall store in a database the contractor performance reviews provided to the department by state agencies under Subsection (a). (c) The department shall make the database available to state agencies and searchable by: (1) contractor; (2) contract value; (3) state agency; and (4) date, including both the beginning date and the end date of the contract. (d) The commission, in consultation with the department, shall develop a system by which a contractor who receives an unfavorable review may add comments to the database relating to the performance review of the contractor. Sec. 2262.308. APPROVAL BY STATE AGENCIES. (a) A state agency's executive director and its designated contract manager must approve and sign each document required by this subchapter. (b) If a proposed contract amendment or change order changes the monetary value of a contract by more than 10 percent or significantly changes the completion date of a contract, the state agency's executive director must approve the amendment or order. Sec. 2262.309. NEGOTIATION CONTRACTS. (a) A state agency may contract with a state governmental entity or a private entity for negotiation services or advice on a major contract if the agency determines that: (1) there is a substantial need for the negotiation services or advice; and (2) the agency cannot adequately perform the negotiation services with its own personnel or cannot perform the negotiation without advice. (b) A state agency may contract with a private entity for negotiation services or advice only if the agency determines that it cannot obtain the consulting services through a contract with a state governmental entity. SECTION 9. (a) The Department of Information Resources, in coordination with the Legislative Budget Board, the Texas Building and Procurement Commission, and the comptroller, shall analyze current automated information systems of state agencies to determine how the systems may be combined to more effectively standardize and synchronize state contract management, including the use of performance measures in contracts. (b) Not later than December 31, 2005, the department shall report the results of its analysis to the governor, the lieutenant governor, and the speaker of the house of representatives. SECTION 10. A contract manager is not required to be certified under Chapter 2262, Government Code, as amended by this Act, until September 1, 2007. SECTION 11. Not later than March 1, 2006, the Texas Building and Procurement Commission shall develop the continuing education course required by Section 2155.078, Government Code, as amended by this Act. SECTION 12. A state agency is not required to comply with Sections 2262.304-2262.309, Government Code, as added by this Act, until September 1, 2007. A state agency may comply earlier if the forms, electronic requirements, database, or other items are available before that date. SECTION 13. This Act takes effect September 1, 2005.