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A BILL TO BE ENTITLED
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AN ACT
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relating to outsourcing a service performed by a state agency to a |
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private commercial contractor. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 2162.103, Government Code, is amended |
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to read as follows: |
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Sec. 2162.103. COST COMPARISON AND CONTRACT |
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CONSIDERATIONS. (a) In comparing the cost of providing a service, |
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the council shall conduct and consider the conclusions of |
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cost-benefit analyses that compare the costs and benefits of |
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[consider the]: |
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(1) a private contractor's performance of the service, |
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including considering the cost of supervising the work of a private |
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contractor; [and] |
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(2) [cost of] a state agency's performance of the |
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service, including considering the cost of: |
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(A) services provided by [the costs of] the |
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comptroller, attorney general, and other support agencies; and |
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(B) other indirect expenses [costs] related to |
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the agency's performance of the service; and |
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(3) improving the state agency's performance by: |
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(A) developing and implementing a most efficient |
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organization model or a similar model developed by the council; |
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(B) implementing recommendations of state |
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oversight agencies such as the Legislative Budget Board, the state |
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auditor, and the Sunset Advisory Commission; and |
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(C) implementing the recommendations of the |
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agency's governing body intended to improve the agency's provision |
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of a service the council identifies under Section 2162.102(a). |
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(b) The state agency may submit a proposal to the council |
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describing a reorganized service delivery method to compete |
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directly with the performance of a private commercial contractor. |
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(c) In comparing the cost of providing a service, the |
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council in conjunction with the state agency shall prepare and |
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consider an estimate of the costs of returning the performance of |
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the service from the contractor to the state agency in the event |
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that it proves necessary to do so. The estimate must include a |
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reasonable proposed timetable for actions necessary to return the |
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service to the state agency. |
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(d) [(b)] A bid or contract must include an analysis of |
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health care benefits, retirement, and workers' compensation |
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insurance for a contractor's employees that are reasonably |
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comparable to the health care benefits, retirement, and workers' |
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compensation insurance of the state. |
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(e) Cost-benefit analyses used for an evaluation under |
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Subsection (a) must include a short-term analysis covering a period |
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of not more than six months and a long-term analysis covering a |
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period of at least one and not more than five years. |
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SECTION 2. Chapter 2162, Government Code, is amended by |
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adding Subchapter D to read as follows: |
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SUBCHAPTER D. OUTSOURCING MAJOR FUNCTIONS |
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Sec. 2162.151. APPLICABILITY. This subchapter applies in |
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relation to a contract, contract amendment, or contract extension |
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made or proposed to be made between a state agency and a private |
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commercial contractor only if: |
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(1) a service performed by the agency at the time the |
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contract is awarded, amended, or extended will be outsourced under |
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the contract, contract amendment, or contract extension; and |
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(2) the contract, contract amendment, or contract |
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extension, as applicable: |
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(A) will lead to the loss of 100 or more state |
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employee positions; or |
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(B) has a value of $10 million or more. |
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Sec. 2162.152. DETERMINATION BY COUNCIL REQUIRED. (a) In |
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circumstances under which this subchapter applies, a state agency |
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may not award a contract to, amend a contract with, or extend a |
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contract with a private commercial contractor unless the council |
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determines that the service that will be outsourced under the |
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contract, contract amendment, or contract extension is a service |
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that may be better provided by selecting the provider of the service |
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through competition with other state agencies and private |
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commercial contractors that can provide the service. |
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(b) A state agency may not award a new contract to which this |
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subchapter applies unless the council has made the determination |
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required by Subsection (a) and the provider of the service under the |
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contract is selected through competition with other state agencies |
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and private commercial contractors. A state agency may amend or |
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extend an existing contract under circumstances in which this |
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subchapter applies after the council makes the determination |
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required by Subsection (a). |
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Sec. 2162.153. COMPLIANCE AUDIT. (a) All contracts, |
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contractors, and subcontractors subject to this subchapter are |
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subject to audits conducted by the state auditor in accordance with |
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Chapter 321. The contractor or subcontractor, as appropriate, |
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shall reimburse the state auditor for the cost of the audit. In |
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conducting an audit under this subsection, the state auditor shall: |
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(1) determine whether the contractor has: |
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(A) met the conditions of the contract with |
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regard to the outsourced service; and |
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(B) cooperated with the audit as required by |
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Subsection (b); |
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(2) assess whether the contractor has provided a level |
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of service delivery comparable to that provided by the state agency |
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that most recently provided the service before the service was |
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performed by the contractor; and |
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(3) assess whether cost savings projected in the |
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cost-benefit analysis conducted under Section 2162.103 are being |
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realized. |
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(b) The private commercial contractor and any |
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subcontractors shall cooperate with an audit conducted by the state |
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auditor under this subchapter or Chapter 321. |
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(c) If the governing body of the state agency, after |
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reviewing the auditor's report and any response by the contractor, |
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concludes that the contractor did not perform satisfactorily under |
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the contract, the governing body shall terminate the contract as |
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soon as practicable. |
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(d) A state agency that enters into a contract or agrees to a |
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contract amendment or extension that is subject to this subchapter |
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shall notify the state auditor of the existence of the contract not |
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later than the date the contract, contract amendment, or contract |
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extension takes effect. |
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Sec. 2162.154. ACTIONS FOLLOWING RETURN OF SERVICE. If a |
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service obligation is returned to the state agency after a contract |
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is terminated under Section 2162.153(c): |
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(1) the state agency immediately shall: |
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(A) complete a performance evaluation to design a |
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program to improve the delivery of the service; and |
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(B) implement the program designed under |
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Paragraph (A); and |
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(2) until the end of the sixth month after the month |
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the contract is terminated under Section 2162.153(c), with respect |
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to the service, the council may not: |
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(A) require the service to be submitted to |
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competitive bidding; or |
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(B) make a determination regarding the service |
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under Section 2162.102(b). |
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SECTION 3. The changes in law made by this Act apply only |
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to: |
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(1) the activities of the State Council on Competitive |
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Government or a state agency concerning a proposal to contract with |
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a commercial source to provide services being performed by a state |
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agency, on or after the effective date of this Act; and |
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(2) the evaluation of the services performed by a |
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contractor under a contract, contract amendment, or contract |
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extension made on or after the effective date of this Act. |
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SECTION 4. This Act takes effect September 1, 2011. |