79R2453 MTB-D
By: Isett H.B. No. 3274
A BILL TO BE ENTITLED
AN ACT
relating to the award of state contracts for commercially available
services.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 2155, Government Code, is
amended by adding Section 2155.1445 to read as follows:
Sec. 2155.1445. ANALYSIS OF SERVICES AND FUNCTIONS. (a) In
this section, "inherently governmental in nature" means a function
or service that involves the exercise or use of governmental
authority or discretion.
(b) This section applies only to the Health and Human
Services Commission and to each health and human services agency.
(c) If the Health and Human Services Commission determines
that a proposed contract or proposed contract amendment would lead
to the loss of at least 50 current state employee positions, then
before the commission may issue a competitive solicitation for the
contract or amend the contract the State Council on Competitive
Government shall perform an analysis to determine if any of the
services or functions to be performed under the contract or
contract amendment are inherently governmental in nature.
(d) If the State Council on Competitive Government
determines that a service or function to be performed under the
contract or contract amendment is inherently governmental in
nature, the Health and Human Services Commission may not:
(1) contract with a private entity to perform the
service or function; or
(2) amend the contract, if a private entity is to
perform the service or function under the contract amendment.
(e) The analysis required under this section must use the
standards and policies contained in the Office of Federal
Procurement Policy, Policy Letter 92-1, or comparable guidelines
developed by the State Council on Competitive Government.
SECTION 2. Section 2162.102, Government Code, is amended by
amending Subsection (c) and adding Subsections (e), (f), and (g) to
read as follows:
(c) In performing its duties under this chapter, the council
may:
(1) require a state agency to conduct a hearing,
study, review, or cost estimate, including an agency in-house cost
estimate or a management study, concerning any aspect of a service
identified under Subsection (a);
(2) develop and require state agencies to use methods
to accurately and fairly estimate and account for the cost of
providing a service identified under Subsection (a);
(3) require that a service identified under Subsection
(a) be submitted to competitive bidding or another process that
creates competition with private commercial sources;
(4) prescribe, after consulting affected state
agencies, the specifications and conditions of purchase procedures
that must be followed by the commission and a state agency or a
private commercial source engaged in competitive bidding to provide
a service identified under Subsection (a);
(5) award a contract to a state agency providing the
service, another state agency, a private commercial source, or a
combination of those entities [, if the bidder presents the best and
most reasonable bid, which is not necessarily the lowest bid]; and
(6) determine the terms of a contract for service or
interagency contract to provide a service identified under
Subsection (a).
(e) In performing its duties under this section, the council
shall create a confidential model for each commercially available
service identified to determine how and at what cost a state agency
could most efficiently provide the service.
(f) The council may not award a contract under this section
to a private commercial contractor unless the contractor can
perform the service with a comparable or better level of quality at
a cost that is at least 10 percent lower than the model cost created
under Subsection (e). If the council determines that the contract
involves excessive financial risk, the council may require that the
contractor provide greater cost savings to compensate for that
risk.
(g) When filling employee positions under a contract
awarded under this section, a contractor shall give first
consideration to an applicant formerly employed with a state agency
whose employee position was terminated as a result of the award of
the contract.
SECTION 3. Section 2162.103, Government Code, is amended to
read as follows:
Sec. 2162.103. COST COMPARISON AND CONTRACT
CONSIDERATIONS. (a) In comparing the cost of providing a service,
the council shall consider the:
(1) cost of supervising the work of a private
contractor; [and]
(2) cost of a state agency's performance of the
service, including:
(A) the costs of the comptroller, attorney
general, and other support agencies; and
(B) other indirect costs related to the agency's
performance of the service; and
(3) cost of state unemployment claims for state
employee positions that would be terminated if a private contractor
was awarded the contract.
(b) A bid or contract must include an analysis of [health
care benefits,] retirement [,] and workers' compensation insurance
for a contractor's employees that are reasonably comparable to the
[health care benefits,] retirement[,] and workers' compensation
insurance benefits of the state.
(c) In comparing the cost of providing a service, the
council shall:
(1) require a bid of a private contractor, including
any subcontractors, to include health care benefits for the
employees performing the services under the contract; or
(2) add to a bid amount of a private contractor that
does not include health care benefits for the contractor's
employees, including subcontractor's employees, the cost of health
care benefits for employees performing the services under the
contract based on individual premium costs for employees covered by
the Employees Retirement System of Texas.
SECTION 4. Section 2163.001, Government Code, is amended by
adding Subsection (e) to read as follows:
(e) In performing its duties under this section, the
commission shall create a confidential model for each commercially
available service identified to determine how and at what cost the
commission could most efficiently provide the service.
SECTION 5. Section 2163.002, Government Code, is amended by
amending Subsection (b) and by adding Subsection (c) to read as
follows:
(b) In comparing the cost of providing a service, the
commission must include the:
(1) cost of supervising the work of a private
contractor; [and]
(2) cost to the state of the commission's performance
of the service, including:
(A) the costs of the office of the attorney
general and other support agencies; and
(B) other indirect costs related to the
commission's performance of the service; and
(3) cost of state unemployment claims for state
employee positions that would be terminated if a private contractor
were awarded the contract.
(c) In comparing the cost of providing a service, the
commission shall:
(1) require a bid of a private contractor, including
any subcontractors, to include health care benefits for the
employees performing services under the contract; or
(2) add to a bid amount of a private contractor that
does not include health care benefits for the contractor's
employees, including subcontractor's employees, the cost of health
care benefits for employees performing services under the contract
based on individual premium costs for employees covered by the
Employees Retirement System of Texas.
SECTION 6. Section 2163.003, Government Code, is amended by
adding Subsections (c) and (d) to read as follows:
(c) The commission may not award a contract under this
section to a private commercial contractor unless the contractor
can perform the service at a cost that is at least 10 percent lower
than the model cost created under Section 2163.001(e). If the
commission determines that the contract involves excessive
financial risk, the commission may require that the contractor
provide greater cost savings to compensate for that risk.
(d) When filling employee positions under a contract
awarded under this section, a contractor shall give first
consideration to an applicant formerly employed with a state agency
whose employee position was terminated as a result of the award of
the contract.
SECTION 7. The changes in law made by Section 1 of this Act
apply only to a contract or contract amendment for which a state
agency first advertises or otherwise solicits bids, proposals,
offers, or qualifications on or after the effective date of this
Act. A contract or contract amendment for which a state agency
first advertised or otherwise solicited bids, proposals, offers, or
qualifications before that date is governed by the law in effect
when the first advertisement or solicitation was given and the
former law is continued in effect for that purpose.
SECTION 8. This Act takes effect September 1, 2005.