SECTION 1. Section 223.205,
Transportation Code, is amended to read as follows:
Sec. 223.205. PERFORMANCE
AND PAYMENT SECURITY. (a) Notwithstanding Section 223.006 and the
requirements of Subchapter B, Chapter 2253, Government Code, the department
shall require a private entity entering into a comprehensive development
agreement under this subchapter to provide a performance and payment bond issued
by a corporate surety authorized to issue bonds in this state or an
alternative form of security in an amount sufficient to:
(1) ensure the proper
performance of the agreement; and
(2) protect:
(A) the department; and
(B) security [payment
bond] beneficiaries who have a direct contractual relationship
with the private entity or a subcontractor of the private entity to supply
labor or material.
(b) Except as provided by
Subsection (c), the [A performance and
payment bond or alternative form of]
security shall be in an amount equal to the cost of constructing or maintaining the project.
(c) If the contract amount exceeds $250 million in construction
costs, and the department determines that it is impracticable for a
private entity to provide security in the amount described by Subsection
(b), the department may [shall] set the amount of the [bonds
or the alternative forms of] security at or above $250 million, as
determined by the department to be in the best interest of this state.
(d) The [A payment
or performance bond or alternative form of] security is not required
for and may not cover the portion of an agreement that includes only
design or planning services, the performance of preliminary studies, or the
acquisition of real property.
(e) The amount of the
payment security must not be less than the amount of the performance
security.
(f) In addition to or
instead of a performance and payment bond, the department may require one
or more of the following alternative forms of security:
(1) a cashier's check drawn
on a financial entity specified by the department;
(2) a United States bond or
note; or
(3) an irrevocable bank
letter of credit from a United States
domiciled bank acceptable to the department [; or
[(4) any other form of
security determined suitable by the department].
[(g)
The department by rule shall prescribe requirements for an alternative form
of security provided under this section.]
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SECTION 1. Section 223.205,
Transportation Code, is amended to read as follows:
Sec. 223.205. PERFORMANCE
AND PAYMENT SECURITY. (a) Notwithstanding Section 223.006 and the
requirements of Subchapter B, Chapter 2253, Government Code, the department
shall require a private entity entering into a comprehensive development
agreement under this subchapter to provide a performance and payment bond issued
by a corporate surety authorized to issue surety
bonds in this state or an alternative form of security in an amount
sufficient to:
(1) ensure the proper
performance of the agreement; and
(2) protect:
(A) the department; and
(B) contractors, subcontractors, and suppliers [payment bond beneficiaries] who
have a direct contractual relationship with the private entity or with a subcontractor of the private
entity to supply labor or material for the
project.
(b) Except as provided by
Subsection (c), the [A] performance
and payment bond or alternative form of security shall be in an
amount equal to the cost of constructing [or
maintaining] the project.
(c) If the contract price exceeds $250 million in construction
costs, and the department determines that it is impracticable for a
private entity to provide security in the amount described by Subsection
(b), the department shall set the
amount of [the bonds or the alternative forms of] security at not less than $250 million.
(c-1) The department may require an additional amount of security or
other form of guaranty acceptable to the department in addition to the
amount set by the department under Subsection (c) if the department
determines that additional security or guaranty is required to achieve the
objectives of Subsection (a).
(d) The performance [A payment or performance
bond or alternative form of] security is not required for and may not
cover the portion of an agreement that includes only preliminary design or planning services,
the performance of preliminary studies, or the acquisition of real
property.
(e) The amount of the
payment security is separate from and in
addition to the performance security and must not be less than
the amount of the performance security.
(f) In addition to or
instead of a performance and payment bond issued
by a corporate surety authorized to issue surety bonds in this state,
the department may require one or more of the following alternative forms
of security:
(1) a cashier's check drawn
on a financial entity specified by the department;
(2) a United States bond or
note; or
(3) an irrevocable bank
letter of credit from a financial
institution acceptable to the department that has an office in this state at which the letter of credit may be
presented for payment [; or
[(4) any other form of
security determined suitable by the department].
(g)
The department by rule shall prescribe requirements for an alternative form
of security provided under this section.
(h) If the department authorizes payment security to be provided by
a means other than a payment bond issued by a corporate surety authorized
to issue surety bonds in this state, the comprehensive development
agreement must include provisions specifying how a claimant may submit a
claim and how the claim process will be administered. The department shall
post the claims procedures for the project on its website.
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SECTION 2. Section 366.404,
Transportation Code, is amended to read as follows:
Sec. 366.404. PERFORMANCE
AND PAYMENT SECURITY. (a) Notwithstanding the requirements of Subchapter
B, Chapter 2253, Government Code, an authority shall require a private
entity entering into a comprehensive development agreement under this
subchapter to provide a performance and payment bond issued by a
corporate surety authorized to issue bonds in this state or an
alternative form of security in an amount sufficient to:
(1) ensure the proper
performance of the agreement; and
(2) protect:
(A) the authority; and
(B) security [payment
bond] beneficiaries who have a direct contractual relationship
with the private entity or a subcontractor of the private entity to supply
labor or material.
(b) Except as provided by
Subsection (c), the [A performance and
payment bond or alternative form of] security shall be in an
amount equal to the cost of constructing or
maintaining the project.
(c) If the contract amount exceeds $250 million in construction
costs, and the [an] authority determines that it is
impracticable for a private entity to provide security in the amount
described by Subsection (b), the authority may [shall] set the amount of the [bonds
or the alternative forms of] security at or above $250 million, as
determined by the authority to be in the authority's best interest.
(d) The [A payment
or performance bond or alternative form of] security is not required
for and may not cover the portion of an agreement that includes only
design or planning services, the performance of preliminary studies, or the
acquisition of real property.
(e) The amount of the
payment security must not be less than the amount of the performance
security.
(f) In addition to, or
instead of, performance and payment bonds, an authority may require the
following alternative forms of security:
(1) a cashier's check drawn
on a financial entity specified by the authority;
(2) a United States bond or
note; or
(3) an irrevocable bank
letter of credit from a United States domiciled
bank acceptable to the authority [; or
[(4) any other form of
security determined suitable by the authority].
[(g)
An authority by rule shall prescribe requirements for alternative forms of
security provided under this section.]
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SECTION 2. Section 366.404,
Transportation Code, is amended to read as follows:
Sec. 366.404. PERFORMANCE
AND PAYMENT SECURITY. (a) Notwithstanding the requirements of Subchapter
B, Chapter 2253, Government Code, an authority shall require a private
entity entering into a comprehensive development agreement under this
subchapter to provide a performance and payment bond issued by a
corporate surety authorized to issue surety
bonds in this state or an alternative form of security in an amount
sufficient to:
(1) ensure the proper
performance of the agreement; and
(2) protect:
(A) the authority; and
(B) contractors, subcontractors, and suppliers [payment bond beneficiaries] who
have a direct contractual relationship with the private entity or with a subcontractor of the private
entity to supply labor or material for the
project.
(b) Except as provided by
Subsection (c), the [A] performance
and payment bond or alternative form of security shall be in an
amount equal to the cost of constructing [or
maintaining] the project.
(c) If the contract price exceeds $250 million in construction
costs, and the [an] authority determines that it is
impracticable for a private entity to provide security in the amount
described by Subsection (b), the authority shall
set the amount of [the bonds or the alternative forms of] security at
not less than $250 million.
(c-1) The authority may require an additional amount of security or
other form of guaranty acceptable to the authority in addition to the
amount set by the authority under Subsection (c) if the authority
determines that additional security or guaranty is required to achieve the
objectives of Subsection (a).
(d) The performance [A payment or performance
bond or alternative form of] security is not required for and may
not cover the portion of an agreement that includes only preliminary design or planning services,
the performance of preliminary studies, or the acquisition of real
property.
(e) The amount of the
payment security is separate from and in
addition to the performance security and must not be less than
the amount of the performance security.
(f) In addition to, or
instead of, performance and payment bonds issued
by a corporate surety authorized to issue surety bonds in this state,
an authority may require the following alternative forms of security:
(1) a cashier's check drawn
on a financial entity specified by the authority;
(2) a United States bond or
note; or
(3) an irrevocable bank
letter of credit from a financial
institution acceptable to the authority that has an office in this state at which the letter of credit may be
presented for payment [; or
[(4) any other form of
security determined suitable by the authority].
(g)
An authority by rule shall prescribe requirements for alternative forms of
security provided under this section.
(h) If the authority authorizes payment security to be provided by a
means other than a payment bond issued by a corporate surety authorized to
issue surety bonds in this state, the comprehensive development agreement
must include provisions specifying how a claimant may submit a claim and
how the claim process will be administered. The authority shall post the
claims procedures for the project on its website.
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SECTION 3. Section 370.308,
Transportation Code, is amended to read as follows:
Sec. 370.308. PERFORMANCE
AND PAYMENT SECURITY. (a) Notwithstanding Section 223.006 and the
requirements of Subchapter B, Chapter 2253, Government Code, an authority
shall require a private entity entering into a comprehensive development
agreement under Section 370.305 to provide a performance and payment bond issued
by a corporate surety authorized to issue bonds in this state or an
alternative form of security in an amount sufficient to:
(1) ensure the proper
performance of the agreement; and
(2) protect:
(A) the authority; and
(B) security [payment
bond] beneficiaries who have a direct contractual relationship
with the private entity or a subcontractor of the private entity to supply
labor or material.
(b) Except as provided by
Subsection (c), the [A performance and
payment bond or alternative form of]
security shall be in an amount equal to the cost of constructing or maintaining the project.
(c) If the contract amount exceeds $250 million in construction
costs, and the [an] authority determines that it is
impracticable for a private entity to provide security in the amount
described by Subsection (b), the authority may [shall] set the amount of the [bonds
or the alternative forms of] security at or above $250 million, as determined
by the authority to be in the authority's best interest.
(d) The [A payment
or performance bond or alternative form of] security is not required
for and may not cover the portion of an agreement that includes only
design or planning services, the performance of preliminary studies, or the
acquisition of real property.
(e) The amount of the
payment security must not be less than the amount of the performance
security.
(f) In addition to
performance and payment bonds, an authority may require the following
alternative forms of security:
(1) a cashier's check drawn
on a financial entity specified by the authority;
(2) a United States bond or
note; or
(3) an irrevocable bank
letter of credit from a United States
domiciled bank acceptable to the authority [; or
[(4) any other form of
security determined suitable by the authority].
[(g)
An authority by rule shall prescribe requirements for alternative forms of
security provided under this section.]
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SECTION 3. Section 370.308,
Transportation Code, is amended to read as follows:
Sec. 370.308. PERFORMANCE
AND PAYMENT SECURITY. (a) Notwithstanding Section 223.006 and the
requirements of Subchapter B, Chapter 2253, Government Code, an authority
shall require a private entity entering into a comprehensive development
agreement under Section 370.305 to provide a performance and payment bond issued
by a corporate surety authorized to issue surety
bonds in this state or an alternative form of security in an amount
sufficient to:
(1) ensure the proper
performance of the agreement; and
(2) protect:
(A) the authority; and
(B) contractors, subcontractors, and suppliers [payment bond beneficiaries] who
have a direct contractual relationship with the private entity or with a subcontractor of the private
entity to supply labor or material for the
project.
(b) Except as provided by
Subsection (c), the [A] performance
and payment bond or alternative form of security shall be in an
amount equal to the cost of constructing [or
maintaining] the project.
(c) If the contract price exceeds $250 million in construction
costs, and the [an] authority determines that it is
impracticable for a private entity to provide security in the amount
described by Subsection (b), the authority shall
set the amount of [the bonds or the alternative forms of] security at
not less than $250 million.
(c-1) The authority may require an additional amount of security or
other form of guaranty acceptable to the authority in addition to the
amount set by the authority under Subsection (c) if the authority
determines that additional security or guaranty is required to achieve the
objectives of Subsection (a).
(d) The performance [A payment or performance
bond or alternative form of] security is not required for and may
not cover the portion of an agreement that includes only preliminary design or planning services,
the performance of preliminary studies, or the acquisition of real
property.
(e) The amount of the
payment security is separate from and in
addition to the performance security and must not be less than
the amount of the performance security.
(f) In addition to
performance and payment bonds issued by a
corporate surety authorized to issue surety bonds in this state, an authority may require the following
alternative forms of security:
(1) a cashier's check drawn
on a financial entity specified by the authority;
(2) a United States bond or
note; or
(3) an irrevocable bank
letter of credit from a financial
institution acceptable to the authority that has an office in this state at which the letter of credit may be
presented for payment [; or
[(4) any other form of
security determined suitable by the authority].
(g)
An authority by rule shall prescribe requirements for alternative forms of
security provided under this section.
(h) If the authority authorizes payment security to be provided by a
means other than a payment bond issued by a corporate surety authorized to
issue surety bonds in this state, the comprehensive development agreement
must include provisions specifying how a claimant may submit a claim and
how the claim process will be administered. The authority shall post the
claims procedures for the project on its website.
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