By: Creighton H.B. No. 987
  COMMITTEE SUBSTITUTE FOR H.B. No. 987By:  West By:  West
         (In the Senate - Received from the House April 16, 2009;
  April 16, 2009, read first time and referred to Committee on
  Intergovernmental Relations; May 11, 2009, reported adversely,
  with favorable Committee Substitute by the following vote:  Yeas 4,
  Nays 0; May 11, 2009, sent to printer.)
 
 
A BILL TO BE ENTITLED
 
AN ACT
 
  relating to competitive procurement requirements for local
  governments.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 44.031(a), Education Code, is amended to
  read as follows:
         (a)  Except as provided by this subchapter, all school
  district contracts, except contracts for the purchase of produce or
  vehicle fuel, valued at $50,000 [$25,000] or more in the aggregate
  for each 12-month period shall be made by the method, of the
  following methods, that provides the best value for the district:
               (1)  competitive bidding;
               (2)  competitive sealed proposals;
               (3)  a request for proposals, for services other than
  construction services;
               (4)  an interlocal contract;
               (5)  a design/build contract;
               (6)  a contract to construct, rehabilitate, alter, or
  repair facilities that involves using a construction manager;
               (7)  a job order contract for the minor construction,
  repair, rehabilitation, or alteration of a facility;
               (8)  the reverse auction procedure as defined by
  Section 2155.062(d), Government Code; or
               (9)  the formation of a political subdivision
  corporation under Section 304.001, Local Government Code.
         SECTION 2.  Subchapter B, Chapter 44, Education Code, is
  amended by adding Section 44.0313 to read as follows:
         Sec. 44.0313.  PROCEDURES FOR ELECTRONIC BIDS OR PROPOSALS.
  (a) A school district may receive bids or proposals under this
  chapter through electronic transmission if the board of trustees of
  the school district adopts rules to ensure the identification,
  security, and confidentiality of electronic bids or proposals and
  to ensure that the electronic bids or proposals remain effectively
  unopened until the proper time.
         (b)  Notwithstanding any other provision of this chapter, an
  electronic bid or proposal is not required to be sealed. A
  provision of this chapter that applies to a sealed bid or proposal
  applies to a bid or proposal received through electronic
  transmission in accordance with the rules adopted under Subsection
  (a).
         SECTION 3.  Section 262.003(a), Local Government Code, is
  amended to read as follows:
         (a)  Any law that requires a county to follow a competitive
  procurement [bidding] procedure in making a purchase requiring the
  expenditure of $50,000 [$25,000] or less does not apply to the
  purchase of an item available for purchase from only one supplier.
         SECTION 4.  Section 262.023(a), Local Government Code, is
  amended to read as follows:
         (a)  Before a county may purchase one or more items under a
  contract that will require an expenditure exceeding $50,000 
  [$25,000], the commissioners court of the county must:
               (1)  comply with the competitive bidding or competitive
  proposal procedures prescribed by this subchapter;
               (2)  use the reverse auction procedure, as defined by
  Section 2155.062(d), Government Code, for purchasing; or
               (3)  comply with a method described by Subchapter H,
  Chapter 271.
         SECTION 5.  Section 262.0245, Local Government Code, is
  amended to read as follows:
         Sec. 262.0245.  COMPETITIVE PROCUREMENT [BIDDING]
  PROCEDURES ADOPTED BY COUNTY PURCHASING AGENTS. A county
  purchasing agent shall adopt procedures that provide for
  competitive procurement [bidding], to the extent practicable under
  the circumstances, for the county purchase of an item [under a
  contract] that is not subject to competitive procurement [bidding
  under Section 262.023].
         SECTION 6.  Section 271.024, Local Government Code, is
  amended to read as follows:
         Sec. 271.024.  COMPETITIVE PROCUREMENT [BIDDING] PROCEDURE
  APPLICABLE TO CONTRACT. If a governmental entity is required by
  statute to award a contract for the construction, repair, or
  renovation of a structure, road, highway, or other improvement or
  addition to real property on the basis of competitive bids, and if
  the contract requires the expenditure of more than $50,000 
  [$25,000] from the funds of the entity, the bidding on the contract
  must be accomplished in the manner provided by this subchapter.
         SECTION 7.  Section 271.054, Local Government Code, is
  amended to read as follows:
         Sec. 271.054.  COMPETITIVE PROCUREMENT [BIDDING]
  REQUIREMENT. Before the governing body of an issuer may enter into
  a contract requiring an expenditure by or imposing an obligation or
  liability on the issuer, or on a subdivision of the issuer if the
  issuer is a county, of more than $50,000 [$25,000], the governing
  body must submit the proposed contract to competitive procurement 
  [bidding].
         SECTION 8.  Section 271.153(a), Local Government Code, is
  amended to read as follows:
         (a)  The total amount of money awarded in an adjudication
  brought against a local governmental entity for breach of a
  contract subject to this subchapter is limited to the following:
               (1)  the balance due and owed by the local governmental
  entity under the contract as it may have been amended, including any
  amount owed as compensation for the increased cost to perform the
  work as a direct result of owner-caused delays or acceleration;
               (2)  the amount owed for change orders or additional
  work the contractor is directed to perform by a local governmental
  entity in connection with the contract; [and]
               (3)  reasonable and necessary attorney's fees that are
  equitable and just; and
               (4)  interest as allowed by law.
         SECTION 9.  Section 271.9051(b), Local Government Code, is
  amended to read as follows:
         (b)  In purchasing under this title any real property,
  personal property that is not affixed to real property, or
  services, if a municipality receives one or more competitive sealed
  bids from a bidder whose principal place of business is in the
  municipality and whose bid is within five percent of the lowest bid
  price received by the municipality from a bidder who is not a
  resident of the municipality, the municipality may enter into a
  contract for an expenditure of less than $100,000 with:
               (1)  the lowest bidder; or
               (2)  the bidder whose principal place of business is in
  the municipality if the governing body of the municipality
  determines, in writing, that the local bidder offers the
  municipality the best combination of contract price and additional
  economic development opportunities for the municipality created by
  the contract award, including the employment of residents of the
  municipality and increased tax revenues to the municipality.
         SECTION 10.  The heading to Section 281.047, Local
  Government Code, is amended to read as follows:
         Sec. 281.047.  CONTRACTS OVER $50,000 [$10,000].
         SECTION 11.  Section 281.047(a), Local Government Code, is
  amended to read as follows:
         (a)  This section applies to a contract that is for materials
  for, or construction of, facilities and that is for an amount
  greater than $50,000 [$10,000].
         SECTION 12.  Section 351.137(b), Local Government Code, is
  amended to read as follows:
         (b)  Construction contracts requiring an expenditure of more
  than $50,000 [$15,000] may be made only after competitive bidding
  as provided by Subchapter B, Chapter 271.
         SECTION 13.  Section 375.221, Local Government Code, is
  amended to read as follows:
         Sec. 375.221.  COMPETITIVE BIDDING ON CERTAIN PUBLIC WORKS
  CONTRACTS. (a)  A contract, other than a contract for services, for
  more than $50,000 [$15,000] for the construction of improvements or
  the purchase of material, machinery, equipment, supplies, and other
  property, except real property, may be entered into only after
  competitive bids. Notice of the contract for the purpose of
  soliciting bids shall be published once a week for two consecutive
  weeks in a newspaper with general circulation in the area in which
  the district is located. The first publication of notice must be
  not later than the 14th [15th] day before the date set for receiving
  bids. The board may adopt rules governing receipt of bids and the
  award of the contract and providing for the waiver of the
  competitive bid requirement if:
               (1)  there is an emergency;
               (2)  the needed materials are available from only one
  source;
               (3)  in a procurement requiring design by the supplier
  competitive bidding would not be appropriate and competitive
  negotiation, with proposals solicited from an adequate number of
  qualified sources, would permit reasonable competition consistent
  with the nature and requirements of the procurement; or
               (4)  after solicitation, it is ascertained that there
  will be only one bidder.
         (b)  If a proposed contract for works, plant improvements,
  facilities other than land, or the purchase of equipment,
  appliances, materials, or supplies is for an estimated amount of
  more than $50,000 [$15,000 but less than $25,000] or for a duration
  of more than two years, competitive sealed proposals [bids] shall
  be asked from at least three persons.
         SECTION 14.  Section 54.054(a), Transportation Code, is
  amended to read as follows:
         (a)  Except as otherwise provided by this chapter, the board
  may award a contract involving the expenditure of funds in excess of
  the amount applicable to an expenditure of funds by a municipality
  under Section 252.021(a), Local Government Code, [more than
  $25,000] only by competitive bidding.
         SECTION 15.  Section 44.033, Education Code, is repealed.
         SECTION 16.  Section 271.159, Local Government Code, is
  repealed.
         SECTION 17.  The change in law made by this Act applies only
  to a claim that arises under a contract executed on or after the
  effective date of this Act.  A claim that arises under a contract
  executed 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.
         SECTION 18.  This Act takes effect immediately if it
  receives a vote of two-thirds of all the members elected to each
  house, as provided by Section 39, Article III, Texas Constitution.  
  If this Act does not receive the vote necessary for immediate
  effect, this Act takes effect September 1, 2009.
 
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