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By: Zaffirini, et al. S.B. No. 12
A BILL TO BE ENTITLED
AN ACT
relating to contracting and ethics issues of governmental entities;
providing a civil penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. CHANGES TO LAW ON STATEWIDE CONTRACT MANAGEMENT
SECTION 1.01. Section 2262.001, Government Code, is amended
by amending Subdivision (3) and adding Subdivision (3-a) to read as
follows:
(3) "Contract manager" means a person who:
(A) is employed by a state agency; and
(B) has significant contract management duties
for the state agency[, as determined by the agency in consultation
with the state auditor].
(3-a) "Executive director" means the administrative
head of a state agency.
SECTION 1.02. Subchapter A, Chapter 2262, Government Code,
is amended by adding Section 2262.0015 to read as follows:
Sec. 2262.0015. APPLICABILITY TO CERTAIN CONTRACTS. The
commission by rule shall establish threshold requirements that
exclude small or routine contracts, including purchase orders, from
the application of this chapter.
SECTION 1.03. The heading to Section 2262.053, Government
Code, is amended to read as follows:
Sec. 2262.053. TRAINING FOR CONTRACT MANAGERS.
SECTION 1.04. Section 2262.053, Government Code, is amended
by amending Subsections (a) and (d) and adding Subsections (e) and
(f) to read as follows:
(a) In coordination with the comptroller, Department of
Information Resources, [and] state auditor, and Health and Human
Services Commission, the commission or a private vendor selected by
the commission shall develop [or administer] a training program for
contract managers.
(d) The commission [Texas Building and Procurement
Commission] shall administer the training program under this
section.
(e) The commission shall certify contract managers who have
completed the contract management training required under this
section and keep a list of those contract managers.
(f) The program developed under this section must include a
separate class on ethics and contracting.
SECTION 1.05. Subchapter B, Chapter 2262, Government Code,
is amended by adding Section 2262.0535 and Sections 2262.055
through 2262.067 to read as follows:
Sec. 2262.0535. TRAINING FOR GOVERNING BODIES. (a) The
commission or a private vendor selected by the commission shall
adapt the program developed under Section 2262.053 to develop an
abbreviated program for training the members of the governing
bodies of state agencies. The training may be provided together
with other required training for members of state agency governing
bodies.
(b) All members of the governing body of a state agency
shall complete at least one course of the training developed under
this section. This subsection does not apply to a state agency that
does not enter into any contracts.
Sec. 2262.055. FEES FOR TRAINING. The commission shall set
and collect a fee from state agencies that receive training under
this subchapter in an amount that recovers the commission's costs
for the training.
Sec. 2262.056. STATE AGENCY REPOSITORY. Each state agency
shall maintain in a central location all contracts for that agency.
Sec. 2262.057. CONTRACTS DATABASE. (a) The commission
shall store in a database information on contracts provided by
state agencies under this section.
(b) Each state agency shall periodically provide to the
commission information regarding contracts entered into by the
agency, including:
(1) the name of the contractor;
(2) the contract value;
(3) the beginning date and end date of the contract;
(4) a description of any amendments made to the
contract;
(5) cumulative payments and encumberances under the
contract;
(6) key contract terms that are out of compliance in
terms of timeliness standards; and
(7) any other information that the commission
considers necessary for the database created under this section.
(c) The commission shall set appropriate criteria to
determine when and what information should be updated.
(d) The commission 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.
Sec. 2262.058. REPORTING CONTRACTOR PERFORMANCE.
(a) After a contract is completed or otherwise terminated, each
state agency shall review the contractor's performance under the
contract.
(b) Using the forms developed by the team under Sections
2262.104 and 2262.105, the state agency shall report to the
commission on the results of the review regarding the contractor's
performance under the contract.
Sec. 2262.059. CONTRACTOR PERFORMANCE DATABASE. (a) The
commission shall store in a database contractor performance reviews
as provided by this section.
(b) The commission shall evaluate the contractor's
performance based on the information reported under Section
2262.058 and criteria established by the commission.
(c) The commission shall establish an evaluation process
that allows vendors who receive an unfavorable performance review
to protest any classification given by the commission.
(d) The commission shall develop a database that
incorporates the performance reviews and aggregates the reviews for
each contractor.
(e) A state agency may use the performance review database
to determine whether to award a contract to a contractor reviewed in
the database.
Sec. 2262.060. EXCLUDING CONTRACTOR FROM SOLICITATION
PROCESS. Based on its own contractor performance reviews and on
information in the database developed under Section 2262.059, a
state agency may exclude a contractor from the solicitation process
for a contract if the agency determines the contractor has
performed poorly on a previous state contract without regard to
whether the contractor has been barred under Section 2155.077.
Sec. 2262.061. PERFORMANCE MEASURES; REPORTS. (a) Each
state agency shall develop a plan for incorporating performance
measures into all contracts entered into by the agency.
(b) This includes ensuring that performance measures are
written into each contract prior to execution.
(c) Not later than March 1 of each year, each state agency
shall report to the team, governor, lieutenant governor, and
speaker of the house of representatives regarding performance
measures in the agency's contracts. The report must describe the
agency's efforts to include performance-based provisions in the
agency's contracts.
(d) The state agency shall make the report accessible to the
public on the agency's website.
Sec. 2262.062. CONTRACT MANAGERS. (a) Each state agency
that enters into contracts other than interagency contracts shall
establish a career ladder program for contract management in the
agency.
(b) An employee hired as a contract manager shall oversee
and may, as appropriate, engage in procurement planning, contract
solicitation, contract formation, price establishment, and other
contract activities.
(c) Each state agency shall determine, in consultation with
the state auditor, the amount and significance of contract
management duties sufficient for an employee to be considered a
contract manager under this chapter.
Sec. 2262.063. APPROVAL OF CONTRACTS. (a) Each state
agency shall establish formal guidelines regarding who may approve
a contract for the agency.
(b) Each state agency shall promulgate administrative rules
to establish a monetary threshold above which agency contracts and
amendments to agency contracts require written authorization by the
agency executive director.
(c) For state agency contracts valued in excess of $1
million the agency executive director must authorize a contract
amendment in writing.
(d) Each state agency shall annually report to the
commission a list of each person authorized to approve contracts at
the agency. The list must include the person's name, position, and
supervisory responsibility, if any.
Sec. 2262.064. NEGOTIATION OF CONTRACT BY SINGLE EMPLOYEE
PROHIBITED. A state agency may not negotiate a contract with only
one employee engaging in the negotiation.
Sec. 2262.065. CONSISTENT PRICING BY CONTRACTORS. (a) The
commission may solicit a contract for the creation of a mechanism
for tracking and comparing prices that state agencies pay for
similar products or services.
(b) On behalf of the state, a contractor awarded a contract
under Subsection (a) may renegotiate state agency contracts for
products or services to obtain the best value for the state when the
tracking and comparing mechanism shows a disparity in the price
paid for similar products or services. A contract under Subsection
(a) may allow the selected contractor to keep a percentage of the
savings obtained in the renegotiated contracts.
(c) A state agency shall give a contractor selected under
Subsection (a) the information the contractor requires for the
purpose of tracking and comparing prices that state agencies pay
for similar products and services.
(d) A contractor selected under Subsection (a) may not sell
information it receives under Subsection (c) or otherwise make use
of the information for a purpose other than performing its contract
with the state.
Sec. 2262.066. EXCEPTION TO RENEGOTIATION REQUIREMENT.
(a) A state agency may exclude a contract from the application of
Section 2262.065 if it determines that renegotiation of the
contract under that section will affect the state negatively. The
state agency must notify the commission, lieutenant governor, and
speaker of the house of representatives regarding this
determination and explain why renegotiation of the contract is
contrary to the state's overall interest.
(b) The commission shall adopt rules and procedures to
document this process, including a requirement that the executive
directors of the commission and the state agency making the
determination formally approve the determination by signature or
other appropriate method.
Sec. 2262.067. DEVELOPMENT OF OPTIMIZED MODEL FOR CERTAIN
CONTRACTS. (a) If a state agency determines that a proposed
contract or proposed contract amendment would outsource existing
services or functions performed by the agency that have a value of
$10,000,000 or more, or that would lead to the loss of 100 or more
existing state employee positions, the agency shall create an
optimized model for the identified functions or services to
determine how and at what cost the agency could most efficiently
provide the functions or services.
(b) The model must show consideration of all relevant
factors, including:
(1) best practices in Texas and other states;
(2) available technology;
(3) access to benefits and services for clients; and
(4) program integrity.
(c) An agency that develops an optimized model under this
section shall use it as the basis for cost comparison when deciding
whether to outsource the identified functions or services.
(d) A model developed under this section is confidential and
is not subject to disclosure under Chapter 552 until a final
determination has been made to award the contract for which the
model was developed.
SECTION 1.06. Subchapter C, Chapter 2262, Government Code,
is amended by adding Sections 2262.104 and 2262.105 to read as
follows:
Sec. 2262.104. UNIFORM DEFINITIONS AND FORMS. (a) The
team shall develop and publish a uniform set of definitions for use
as applicable in state contracts.
(b) The team shall develop and publish a uniform and
automated set of forms that a state agency may use in the different
stages of the contracting process.
Sec. 2262.105. FORMS FOR REPORTING CONTRACTOR PERFORMANCE.
As part of the uniform forms published under Section 2262.104, the
team shall develop forms for use by state agencies in reporting a
contractor's performance under Section 2262.058.
SECTION 1.07. Chapter 2262, Government Code, is amended by
adding Subchapters D, E, and F to read as follows:
SUBCHAPTER D. CONTRACT PROVISIONS
Sec. 2262.151. USE OF UNIFORM FORMS. A state agency may use
the forms developed under Section 2262.104 as templates, guides, or
samples for contracts entered into by the agency.
Sec. 2262.152. CONTRACT TERMS RELATING TO NONCOMPLIANCE.
(a) The team shall develop recommendations for contract terms
regarding penalties for contractors who do not comply with a
contract, including penalties for contractors who do not disclose
conflicts of interest under Section 2262.201. The team may develop
recommended contract terms that are generally applicable to state
contracts and terms that are applicable to important types of state
contracts.
(b) A state agency may include applicable recommended terms
in a contract entered into by the agency.
Sec. 2262.153. REQUIRED PROVISION RELATING TO
SUBCONTRACTOR COMPLIANCE. Each state agency contract must require
that each contractor provide a list of all subcontractors and
include a provision that:
(1) holds the contractor responsible for the conduct
of all subcontractors in complying with the contractor's contract
with the state agency; and
(2) requires each subcontractor to disclose all
potential conflicts of interest to the state agency, according to
guidelines developed under Section 2262.201(b), when the
subcontractor contracts with or is otherwise hired by the
contractor.
Sec. 2262.154. REQUIRED CONTRACTOR DISCLOSURE STATEMENT;
STATE AGENCY EMPLOYEES. (a) The team shall develop a standard
contract provision requiring a contractor and subcontractor to
disclose each employee:
(1) who was employed by:
(A) the state at any time during the two years
before the date of the disclosure and is now employed by the
contractor; and
(B) the contractor at any time during the year
before the date of the disclosure and is now employed by the state;
and
(2) who is:
(A) materially involved in the development of the
contract terms or the management of the contract; or
(B) employed at the executive level with the
contractor.
(b) A state agency shall include the provision in a contract
entered into by the agency.
Sec. 2262.155. REQUIRED CONTRACTOR DISCLOSURE STATEMENT;
OUTSOURCING. (a) Each contract entered into by a state agency
must include a provision requiring disclosure of any services
materially necessary to fulfill the contract, including services
performed by a subcontractor, that will be or are performed in a
country other than the United States. This section does not apply
to services that are incidental to fulfilling the contract.
(b) The contract must include a provision allowing the state
agency to terminate the contract and solicit a new contract if:
(1) the contractor or a subcontractor of the
contractor performs a service materially necessary to fulfill the
contract in a country other than the United States; and
(2) the contractor did not disclose in the contract at
the time the contract was originally entered into that the service
would be performed in a country other than the United States.
(c) A state agency that decides not to solicit a new
contract under circumstances in which the agency is authorized to
do so under a contract provision required by Subsection (b) shall
report this decision to:
(1) the governor;
(2) the lieutenant governor;
(3) the speaker of the house of representatives; and
(4) the team.
Sec. 2262.156. HIRING PREFERENCE PROVISION FOR CERTAIN
LARGE CONTRACTS. If a state agency determines that a proposed
contract or proposed contract amendment would outsource existing
services or functions performed by the agency that have a value of
$10,000,000 or more, or that would lead to the loss of 100 or more
existing state employee positions, the contract or contract
amendment must contain a provision that requires the contractor to
give preference in hiring to former employees of a state agency:
(1) whose employment is terminated because of the
contract or contract amendment; and
(2) who satisfy the contactor's hiring criteria for
that position.
[Sections 2262.157-2262.200 reserved for expansion]
SUBCHAPTER E. ETHICS; CONFLICT OF INTEREST
Sec. 2262.201. CONTRACTOR CONFLICTS OF INTEREST. (a) Each
contractor who responds to a state agency's contract solicitation
shall disclose in its response all potential conflicts of interest
to the agency.
(b) The team shall develop guidelines to aid contractors and
state agencies in identifying potential conflicts of interest.
Sec. 2262.202. EXECUTIVE DIRECTORS; ETHICS IN CONTRACTING
CLASS. Each executive director of a state agency shall annually
complete the ethics and contracting class developed under Section
2262.053. This section does not apply to a state agency that does
not enter into any contracts.
[Sections 2262.203-2262.250 reserved for expansion]
SUBCHAPTER F. CHANGES TO CONTRACTS
Sec. 2262.251. CONTRACT AMENDMENTS AND CHANGE ORDERS.
(a) An amendment to a contract, including a change order, is
subject to the same approval processes as the original contract.
(b) A state agency may not amend a contract unless:
(1) the agency complies with the same approval
processes for the amendment as required for the original contract;
and
(2) a contract manager for the agency states in
writing why the amendment is necessary.
(c) This section does not require a new solicitation for a
new contract.
Sec. 2262.252. LARGE CHANGE IN CONTRACT VALUE. (a) If a
proposed contract amendment or extension changes the monetary value
of a contract by more than 10 percent, the state agency must obtain
review and approval from the team and the agency's executive
director before the agency amends or extends the contract.
(b) This section does not apply to contract extensions that
are specifically established as a component of the original
procurement.
SECTION 1.08. Section 2262.003, Government Code, is
transferred to Subchapter D, Chapter 2262, Government Code, as
added by this Act, is redesignated as Section 2262.156, Government
Code, and is amended to read as follows:
Sec. 2262.156 [2262.003]. REQUIRED [CONTRACT] PROVISION
RELATING TO AUDITING. (a) Each state agency shall include in each
of its contracts a term that provides that:
(1) the state auditor may conduct an audit or
investigation of any entity receiving funds from the state directly
under the contract or indirectly through a subcontract under the
contract; and
(2) acceptance of funds directly under the contract or
indirectly through a subcontract under the contract acts as
acceptance of the authority of the state auditor, under the
direction of the legislative audit committee, to conduct an audit
or investigation in connection with those funds.
(b) The state auditor shall provide assistance to a state
agency in developing the contract provisions.
SECTION 1.09. (a) Sections 2262.064 and 2262.067,
Government Code, as added by this article, apply only to a contract
for which a state agency first advertises or otherwise solicits
bids, proposals, offers, or qualifications on or after the
effective date of this Act.
(b) Subsection (a), Section 2262.201, Government Code, as
added by this article, applies only in relation to a contract for
which a state agency first solicits bids, proposals, offers, or
qualifications on or after the date that the Contract Advisory
Team's guidelines regarding potential conflicts of interest take
effect.
SECTION 1.10. Not later than March 1, 2006, the Texas
Building and Procurement Commission shall develop the training
program, including the ethics and contracting class, required by
Section 2262.053, Government Code, as amended by this article, and
Section 2262.0535, Government Code, as added by this article.
SECTION 1.11. A member of a governing body of a state agency
is not required to complete the training developed under Section
2262.0535, Government Code, as added by this article, until
September 1, 2007.
SECTION 1.12. An executive director of a state agency is not
required to comply with Section 2262.202, Government Code, as added
by this article, until September 1, 2007.
SECTION 1.13. A contract manager is not required to be
certified under Chapter 2262, Government Code, as amended by this
article, until September 1, 2007.
SECTION 1.14. (a) As soon as practicable, and not later
than March 1, 2006, the Contract Advisory Team shall develop the
forms, criteria, recommendations, and provisions required by this
article, including Sections 2262.104, 2262.105, 2262.152, and
2262.154 and Subsection (b), Section 2262.201, Government Code, as
added by this article.
(b) A state agency is not required to comply with Sections
2262.056 through 2262.063 and Sections 2262.153, 2262.154,
2262.155, and 2262.156, Government Code, as added by this article,
until September 1, 2007. A state agency may comply earlier if the
forms, electronic requirements, database, or other items are
available before that date.
ARTICLE 2. CHANGES TO LAW ON PERSONAL FINANCIAL DISCLOSURE,
STANDARDS OF CONDUCT, AND CONFLICT OF INTEREST
SECTION 2.01. Subchapter C, Chapter 572, Government Code,
is amended by adding Section 572.060 to read as follows:
Sec. 572.060. CONFLICT OF INTEREST OF STATE OFFICER OR
EMPLOYEE OR LEGISLATIVE CONSULTANT; CIVIL PENALTY. (a) In this
section:
(1) "Legislative consultant" means:
(A) a person providing services under contract as
a consultant to the senate, the house of representatives, or a
member or committee of either house; or
(B) a person providing services under contract as
a consultant to a state agency in connection with legislation or
communications with members of the legislature or legislative
employees.
(2) "Legislative employee" means a person employed by:
(A) the senate, the house of representatives, or
a committee of either house; or
(B) a member of the legislature acting in the
member's official capacity.
(3) "Member of the governor's executive staff" means a
person employed by the governor acting in the governor's official
capacity whose regular job duties include:
(A) the formulation of policy or testifying
before and meeting with members of the legislature; or
(B) supervising other employees in the
governor's office whose regular job duties include those described
by Paragraph (A).
(4) "State agency legislative liaison" means an
employee of a state agency who serves as a legislative liaison or
government affairs officer or acts in a similar capacity or whose
regular job duties include testifying before and meeting with
members of the legislature.
(5) "State agency procurement agent" means an employee
of a state agency whose regular job duties include soliciting,
evaluating, or awarding bids, proposals, or contracts for the
procurement by the state agency of property or services.
(b) This section applies to an appointed officer, executive
head of a state agency, member of the governor's executive staff,
legislative employee, state agency legislative liaison, state
agency procurement agent, or legislative consultant.
(c) For purposes of this section, a person to whom this
section applies has a conflict of interest if the person has a
personal financial or other interest in the subject matter of a
governmental decision or action that compromises or has the
appearance of compromising the person's professional judgment or
integrity.
(d) A person to whom this section applies who has a conflict
of interest with respect to a governmental decision or action
shall:
(1) disclose the conflict in writing delivered to the
state officer or state agency employing or contracting with the
person; and
(2) abstain from further participation in the
governmental decision or action.
(e) A person who violates this section is liable for a civil
penalty of not less than $500 and not more than the value of a
monetary gain the person receives because of the governmental
decision or action.
(f) Subsection (e) does not prohibit:
(1) the imposition of a civil penalty under Chapter
571; or
(2) removal of an appointed officer under Section
572.058 for conduct that violates both this section and Section
572.058.
SECTION 2.02. Section 572.060, Government Code, as added by
this article, applies only to participation in a governmental
decision made or action taken on or after September 1, 2005.
Participation in a governmental decision made or action taken
before September 1, 2005, is governed by the law in effect on the
date the decision is made or the action is taken, and the former law
is continued in effect for that purpose.
ARTICLE 3. CHANGES RELATED TO STATE AUDIT CONTRACTS
SECTION 3.01. Subsection (a), Section 321.020, Government
Code, is amended to read as follows:
(a) Notwithstanding any other law, a state agency, or a
corporation that is dedicated to the benefit of a state agency and
that meets the criteria specified by Section B, Article 2.23B,
Texas Non-Profit Corporation Act (Article 1396-2.23B, Vernon's
Texas Civil Statutes), may employ a private auditor to audit the
state agency or corporation only if:
(1) the agency or corporation is authorized to
contract with a private auditor [do so by law or] through a
delegation of authority from the state auditor;
(2) the scope of the proposed audit has been submitted
to the state auditor for review and comment; and
(3) the services of the private auditor are procured
through a competitive selection process in a manner allowed by law.
SECTION 3.02. Subsection (a), Section 2113.102, Government
Code, is amended to read as follows:
(a) A state agency may not use appropriated money to
contract with a person to audit [the financial records or accounts
of] the agency except:
(1) as provided by[:
[(1)] Subsections (b), (c), and (d); and
(2) in accordance with Section 321.020 [Chapter 466,
pertaining to the state lottery;
[(3) Chapter 2306, pertaining to the Texas Department
of Housing and Community Affairs; and
[(4) Chapter 361, Transportation Code, pertaining to
the Texas Turnpike Authority division of the Texas Department of
Transportation].
SECTION 3.03. Subsection (a), Section 321.020, Government
Code, as amended by this article, applies only to a contract that is
entered into, amended, extended, or renewed on or after the
effective date of this Act.
ARTICLE 4. PREFERENCE IN GOVERNMENTAL PURCHASING DECISIONS FOR
VENDORS THAT PROVIDE HEALTH BENEFITS TO EMPLOYEES
SECTION 4.01. Subsection (b), Section 44.031, Education
Code, is amended to read as follows:
(b) Except as provided by this subchapter, in determining to
whom to award a contract, the district may consider:
(1) the purchase price;
(2) the reputation of the vendor and of the vendor's
goods or services;
(3) the quality of the vendor's goods or services;
(4) the extent to which the goods or services meet the
district's needs;
(5) the vendor's past relationship with the district;
(6) the impact on the ability of the district to comply
with laws and rules relating to historically underutilized
businesses;
(7) the total long-term cost to the district to
acquire the vendor's goods or services; [and]
(8) whether the vendor provides health benefits
coverage to employees; and
(9) any other relevant factor specifically listed in
the request for bids or proposals.
SECTION 4.02. Subchapter B, Chapter 44, Education Code, is
amended by adding Section 44.0421 to read as follows:
Sec. 44.0421. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) A district procuring goods or services
shall give preference to goods or services of a vendor that
demonstrates that the vendor provides health benefits coverage that
is at least equivalent to a standard health benefit plan offered in
accordance with Article 3.80, Article 20A.09N, or Chapter 1507,
Insurance Code, to each of the vendor's full-time employees and
dependents of full-time employees if:
(1) the goods or services meet district specifications
regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the district that would result if the district
procured similar goods or services from a vendor that does not
demonstrate that the vendor provides health benefits coverage to
the vendor's employees and employees' dependents.
(b) A district may not give preference under this section to
a vendor that provides health benefits coverage to its employees
over a vendor with 50 or fewer employees that does not provide
health benefits coverage to its employees and employees'
dependents.
SECTION 4.03. Subsection (b), Section 51.9335, Education
Code, is amended to read as follows:
(b) In determining what is the best value to an institution
of higher education, the institution shall consider:
(1) the purchase price;
(2) the reputation of the vendor and of the vendor's
goods or services;
(3) the quality of the vendor's goods or services;
(4) the extent to which the goods or services meet the
institution's needs;
(5) the vendor's past relationship with the
institution;
(6) the impact on the ability of the institution to
comply with laws and rules relating to historically underutilized
businesses and to the procurement of goods and services from
persons with disabilities;
(7) the total long-term cost to the institution of
acquiring the vendor's goods or services;
(8) any other relevant factor that a private business
entity would consider in selecting a vendor; [and]
(9) the use of material in construction or repair to
real property that is not proprietary to a single vendor unless the
institution provides written justification in the request for bids
for use of the unique material specified; and
(10) whether the vendor provides health benefits
coverage to employees.
SECTION 4.04. Subchapter Z, Chapter 51, Education Code, is
amended by adding Section 51.9336 to read as follows:
Sec. 51.9336. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) In this section, "institution of higher
education" has the meaning assigned by Section 61.003.
(b) An institution of higher education procuring goods or
services shall give preference to goods or services of a vendor that
demonstrates that the vendor provides health benefits coverage that
is at least equivalent to a standard health benefit plan offered in
accordance with Article 3.80, Article 20A.09N, or Chapter 1507,
Insurance Code, to each of the vendor's full-time employees and
dependents of full-time employees if:
(1) the goods or services meet institution
specifications regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the institution that would result if the
institution procured similar goods or services from a vendor that
does not demonstrate that the vendor provides health benefits
coverage to the vendor's employees and employees' dependents.
(c) An institution of higher education may not give
preference under this section to a vendor that provides health
benefits coverage to its employees over a vendor with 50 or fewer
employees that does not provide health benefits coverage to its
employees and employees' dependents.
SECTION 4.05. Subsection (b), Section 73.115, Education
Code, is amended to read as follows:
(b) In determining what is the best value to the
institution, the institution shall consider:
(1) the purchase price;
(2) the reputation of the vendor and of the vendor's
goods or services;
(3) the quality of the vendor's goods or services;
(4) the extent to which the goods or services meet the
institution's needs;
(5) the vendor's past relationship with the
institution;
(6) the impact on the ability of the institution to
comply with laws and rules relating to historically underutilized
businesses;
(7) the total long-term cost to the institution of
acquiring the vendor's goods or services; [and]
(8) as provided by Section 51.9336, whether the vendor
provides health benefits coverage to employees; and
(9) any other relevant factor that a private business
entity would consider in selecting a vendor.
SECTION 4.06. Subsection (b), Section 74.008, Education
Code, is amended to read as follows:
(b) In determining what is the best value to the medical
branch, the medical branch shall consider:
(1) the purchase price;
(2) the reputation of the vendor and of the vendor's
goods or services;
(3) the quality of the vendor's goods or services;
(4) the extent to which the goods or services meet the
medical branch's needs;
(5) the vendor's past relationship with the medical
branch;
(6) the impact on the ability of the medical branch to
comply with laws and rules relating to historically underutilized
businesses;
(7) the total long-term cost to the medical branch of
acquiring the vendor's goods or services; [and]
(8) as provided by Section 51.9336, whether the vendor
provides health benefits coverage to employees; and
(9) any other relevant factor that a private business
entity would consider in selecting a vendor.
SECTION 4.07. Subsection (b), Section 2155.074, Government
Code, is amended to read as follows:
(b) In determining the best value for the state, the
purchase price and whether the goods or services meet
specifications are the most important considerations. However, the
commission or other state agency may, subject to Subsection (c) and
Section 2155.075, consider other relevant factors, including:
(1) installation costs;
(2) life cycle costs;
(3) the quality and reliability of the goods and
services;
(4) the delivery terms;
(5) indicators of probable vendor performance under
the contract such as past vendor performance, the vendor's
financial resources and ability to perform, the vendor's experience
or demonstrated capability and responsibility, and the vendor's
ability to provide reliable maintenance agreements and support;
(6) the cost of any employee training associated with
a purchase;
(7) the effect of a purchase on agency productivity;
(8) the vendor's anticipated economic impact to the
state or a subdivision of the state, including potential tax
revenue and employment;
(9) whether the vendor provides health benefits
coverage to employees; and
(10) [(9)] other factors relevant to determining the
best value for the state in the context of a particular purchase.
SECTION 4.08. Subchapter H, Chapter 2155, Government Code,
is amended by adding Section 2155.452 to read as follows:
Sec. 2155.452. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) The commission and all state agencies
procuring goods or services shall give preference to goods or
services of a vendor that demonstrates that the vendor provides
health benefits coverage that is at least equivalent to a standard
health benefit plan offered in accordance with Article 3.80,
Article 20A.09N, or Chapter 1507, Insurance Code, to each of the
vendor's full-time employees and dependents of full-time employees
if:
(1) the goods or services meet state specifications
regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the commission or state agency that would
result if the commission or state agency procured similar goods or
services from a vendor that does not demonstrate that the vendor
provides health benefits coverage to the vendor's employees and
employees' dependents.
(b) The commission or a state agency may not give preference
under this section to a vendor that provides health benefits
coverage to its employees over a vendor with 50 or fewer employees
that does not provide health benefits coverage to its employees and
employees' dependents.
SECTION 4.09. Subsection (b), Section 252.043, Local
Government Code, is amended to read as follows:
(b) In determining the best value for the municipality, the
municipality may consider:
(1) the purchase price;
(2) the reputation of the bidder and of the bidder's
goods or services;
(3) the quality of the bidder's goods or services;
(4) the extent to which the goods or services meet the
municipality's needs;
(5) the bidder's past relationship with the
municipality;
(6) the impact on the ability of the municipality to
comply with laws and rules relating to contracting with
historically underutilized businesses and nonprofit organizations
employing persons with disabilities;
(7) the total long-term cost to the municipality to
acquire the bidder's goods or services; [and]
(8) whether the bidder provides health benefits
coverage to employees; and
(9) any relevant criteria specifically listed in the
request for bids or proposals.
SECTION 4.10. Subchapter C, Chapter 252, Local Government
Code, is amended by adding Section 252.0431 to read as follows:
Sec. 252.0431. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) A municipality procuring goods or services
shall give preference to goods or services of a vendor that
demonstrates that the vendor provides health benefits coverage that
is at least equivalent to a standard health benefit plan offered in
accordance with Article 3.80, Article 20A.09N, or Chapter 1507,
Insurance Code, to each of the vendor's full-time employees and
dependents of full-time employees if:
(1) the goods or services meet municipality
specifications regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the municipality that would result if the
municipality procured similar goods or services from a vendor that
does not demonstrate that the vendor provides health benefits
coverage to the vendor's employees and employees' dependents.
(b) A municipality may not give preference under this
section to a vendor that provides health benefits coverage to its
employees over a vendor with 50 or fewer employees that does not
provide health benefits coverage to its employees and employees'
dependents.
SECTION 4.11. Subchapter C, Chapter 262, Local Government
Code, is amended by adding Section 262.0271 to read as follows:
Sec. 262.0271. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) The commissioners court of a county
procuring goods or services shall give preference to goods or
services of a vendor that demonstrates that the vendor provides
health benefits coverage that is at least equivalent to a standard
health benefit plan offered in accordance with Article 3.80,
Article 20A.09N, or Chapter 1507, Insurance Code, to each of the
vendor's full-time employees and dependents of full-time employees
if:
(1) the goods or services meet county specifications
regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the county that would result if the
commissioners court procured similar goods or services from a
vendor that does not demonstrate that the vendor provides health
benefits coverage to the vendor's employees and employees'
dependents.
(b) A commissioners court may not give preference under this
section to a vendor that provides health benefits coverage to its
employees over a vendor with 50 or fewer employees that does not
provide health benefits coverage to its employees and employees'
dependents.
SECTION 4.12. Subchapter C, Chapter 271, Local Government
Code, is amended by adding Section 271.0571 to read as follows:
Sec. 271.0571. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) A municipality or county procuring goods
or services shall give preference to goods or services of a vendor
that demonstrates that the vendor provides health benefits coverage
that is at least equivalent to a standard health benefit plan
offered in accordance with Article 3.80, Article 20A.09N, or
Chapter 1507, Insurance Code, to each of the vendor's full-time
employees and dependents of full-time employees if:
(1) the goods or services meet municipality or county
specifications regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the municipality or county that would result if
the municipality or county procured similar goods or services from
a vendor that does not demonstrate that the vendor provides health
benefits coverage to the vendor's employees and employees'
dependents.
(b) A municipality or county may not give preference under
this section to a vendor that provides health benefits coverage to
its employees over a vendor with 50 or fewer employees that does not
provide health benefits coverage to its employees and employees'
dependents.
SECTION 4.13. Section 271.113, Local Government Code, is
amended by adding Subsection (c) to read as follows:
(c) In addition to other considerations under this section,
in determining to whom to award a contract, a municipality or county
may consider whether the vendor provides health benefits coverage
that is at least equivalent to a standard health benefit plan
offered in accordance with Article 3.80, Article 20A.09N, or
Chapter 1507, Insurance Code, to each of the vendor's full-time
employees and dependents of full-time employees.
SECTION 4.14. Subchapter H, Chapter 271, Local Government
Code, is amended by adding Section 271.1131 to read as follows:
Sec. 271.1131. PREFERENCE FOR VENDORS THAT PROVIDE HEALTH
BENEFITS COVERAGE. (a) A municipality or county procuring goods
or services shall give preference to goods or services of a vendor
that demonstrates that the vendor provides health benefits coverage
that is at least equivalent to a standard health benefit plan
offered in accordance with Article 3.80, Article 20A.09N, or
Chapter 1507, Insurance Code, to each of the vendor's full-time
employees and dependents of full-time employees if:
(1) the goods or services meet municipality or county
specifications regarding quantity and quality; and
(2) the cost of the goods or services does not exceed
the ultimate cost to the municipality or county that would result if
the municipality or county procured similar goods or services from
a vendor that does not demonstrate that the vendor provides health
benefits coverage to the vendor's employees and employees'
dependents.
(b) A municipality or county may not give preference under
this section to a vendor that provides health benefits coverage to
its employees over a vendor with 50 or fewer employees that does not
provide health benefits coverage to its employees and employees'
dependents.
SECTION 4.15. The changes in law made by this article apply
only to a contract for the procurement of goods and services for
which the solicitation of bids or proposals, request for proposals,
or similar required notification as to the goods or services is
published on or after September 1, 2005. A contract for the
procurement of goods and services for which the solicitation of
bids or proposals, request for proposals, or similar required
notification as to the goods or services is published before
September 1, 2005, is governed by the law in effect at the time the
solicitation, request, or notification is published, and that law
is continued in effect for that purpose.
ARTICLE 5. EFFECTIVE DATE
SECTION 5.01. This Act takes effect September 1, 2005.