By: Watson S.B. No. 1138
(In the Senate - Filed March 3, 2011; March 16, 2011, read
first time and referred to Committee on Transportation and Homeland
Security; April 26, 2011, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 8, Nays 0;
April 26, 2011, sent to printer.)
COMMITTEE SUBSTITUTE FOR S.B. No. 1138 By: Watson
A BILL TO BE ENTITLED
AN ACT
relating to design-build contracts and comprehensive development
agreements of regional mobility authorities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subsections (a) and (b), Section 370.305,
Transportation Code, are amended to read as follows:
(a) [An authority may use a comprehensive development
agreement with a private entity to construct, maintain, repair,
operate, extend, or expand a transportation project.
[(b)] A comprehensive development agreement is an agreement
with a private entity that, at a minimum, provides for the design
and construction of a transportation project, that [and] may [also]
provide for the financing, acquisition, maintenance, or operation
of a transportation project, and that entitles the private entity
to:
(1) a leasehold interest in the transportation
project; or
(2) the right to operate or retain revenue from the
operation of the transportation project.
(b) An authority may not enter into a comprehensive
development agreement unless specifically authorized by the
legislature.
SECTION 2. Chapter 370, Transportation Code, is amended by
adding Subchapter G-1 to read as follows:
SUBCHAPTER G-1. DESIGN-BUILD CONTRACTS
Sec. 370.318. DEFINITIONS. In this subchapter:
(1) "Design-build contractor" means a partnership,
corporation, or other legal entity or team that includes an
engineering firm and a construction contractor qualified to engage
in the construction of transportation projects in this state.
(2) "Design-build method" means a project delivery
method by which an entity contracts with a single entity to provide
both design and construction services for the construction,
rehabilitation, alteration, or repair of a facility.
Sec. 370.319. SCOPE OF AND LIMITATIONS ON CONTRACTS.
(a) An authority may use the design-build method for the design,
construction, financing, expansion, extension, maintenance,
rehabilitation, alteration, or repair of a transportation project.
(b) A design-build contract under this subchapter may not
grant to a private entity:
(1) a leasehold interest in the transportation
project; or
(2) the right to operate or retain revenue from the
operation of the transportation project.
(c) In using the design-build method and in entering into a
contract for the services of a design-build contractor, the
authority and the design-build contractor shall follow the
procedures and requirements of this subchapter.
(d) An authority may enter into not more than two
design-build contracts for transportation projects in any fiscal
year.
Sec. 370.320. USE OF ENGINEER OR ENGINEERING FIRM. (a) To
act as an authority's representative, independent of a design-build
contractor, for the procurement process and for the duration of the
work on a transportation project, an authority shall select or
designate:
(1) an engineer;
(2) a qualified firm, selected in accordance with
Section 2254.004, Government Code, who is independent of the
design-build contractor; or
(3) a general engineering consultant that was
previously selected by an authority and is selected or designated
in accordance with Section 2254.004, Government Code.
(b) The selected or designated engineer or firm has full
responsibility for complying with Chapter 1001, Occupations Code.
Sec. 370.321. OTHER PROFESSIONAL SERVICES. (a) An
authority shall provide or contract for, independently of the
design-build firm, the following services as necessary for the
acceptance of the transportation project by the authority:
(1) inspection services;
(2) construction materials engineering and testing;
and
(3) verification testing services.
(b) An authority shall ensure that the engineering services
contracted for under this section are selected based on
demonstrated competence and qualifications.
Sec. 370.322. REQUEST FOR QUALIFICATIONS. (a) For any
transportation project to be delivered through the design-build
method, an authority must prepare and issue a request for
qualifications. A request for qualifications must include:
(1) information regarding the proposed project's
location, scope, and limits;
(2) information regarding funding available for the
project and a description of the financing to be requested from the
design-build contractor, as applicable;
(3) criteria that will be used to evaluate the
proposals, which must include a proposer's qualifications,
experience, technical competence, and ability to develop the
project;
(4) the relative weight to be given to the criteria;
and
(5) the deadline by which proposals must be received
by the authority.
(b) An authority shall publish notice advertising the
issuance of a request for qualifications in the Texas Register and
on an Internet website maintained by the authority.
(c) An authority shall evaluate each qualifications
statement received in response to a request for qualifications
based on the criteria identified in the request. An authority may
interview responding proposers. Based on the authority's
evaluation of qualifications statements and interviews, if any, an
authority shall qualify or short-list proposers to submit detailed
proposals.
(d) An authority shall qualify or short-list at least two
firms to submit detailed proposals under Section 370.323. If an
authority receives only one responsive proposal to a request for
qualifications, the authority shall terminate the procurement.
(e) An authority may withdraw a request for qualifications
or request for detailed proposals at any time.
Sec. 370.323. REQUEST FOR DETAILED PROPOSALS. (a) An
authority shall issue a request for detailed proposals to proposers
short-listed under Section 370.322. A request for detailed
proposals must include:
(1) information on the overall project goals;
(2) budget or cost estimates;
(3) materials specifications;
(4) special material requirements;
(5) a schematic design approximately 30 percent
complete;
(6) known utilities, provided that an authority is not
required to undertake an effort to locate utilities;
(7) quality assurance and quality control
requirements;
(8) the location of relevant structures;
(9) notice of any rules or goals adopted by the
authority relating to awarding contracts to historically
underutilized businesses;
(10) available geotechnical or other information
related to the project;
(11) the status of any environmental review of the
project;
(12) detailed instructions for preparing the
technical proposal required under Subsection (c), including a
description of the form and level of completeness of drawings
expected; and
(13) the relative weighting of the technical and cost
proposals required under Subsection (c) and the formula by which
the proposals will be evaluated and ranked.
(b) A request for detailed proposals may also include a
general form of the design-build contract that the authority
proposes if the terms of the contract may be modified by the
authority or the design-build contractor prior to contract
execution.
(c) Each response to a request for detailed proposals must
include a sealed technical proposal and a separate sealed cost
proposal.
(d) The technical proposal must address:
(1) the proposer's qualifications and demonstrated
technical competence;
(2) the feasibility of developing the project as
proposed, including identification of anticipated problems;
(3) the proposed solutions to anticipated problems;
(4) the ability of the proposer to meet schedules;
(5) the conceptual engineering design proposed; and
(6) any other information requested by the authority.
(e) An authority may provide for the submission of
alternative technical concepts by a proposer. If an authority
provides for the submission of alternative technical concepts, the
authority must prescribe a process for notifying a proposer whether
the proposer's alternative technical concepts are approved for
inclusion in a technical proposal.
(f) The cost proposal must include:
(1) the cost of delivering the project;
(2) the estimated number of days required to complete
the project; and
(3) any terms for financing for the project that the
proposer plans to provide.
(g) Each proposer must:
(1) select or designate each engineering firm that is
a member of its team based on demonstrated competence and
qualifications; and
(2) certify to the authority that each selection or
designation was based on demonstrated competence and
qualifications.
(h) A response to a request for detailed proposals shall be
due not later than the 180th day after the final request for
detailed proposals is issued by the authority. This subsection
does not preclude the release by the authority of a draft request
for detailed proposals for purposes of receiving input from
short-listed proposers.
(i) An authority shall first open, evaluate, and score each
responsive technical proposal submitted on the basis of the
criteria described in the request for detailed proposals and assign
points on the basis of the weighting specified in the request for
detailed proposals. The authority may reject as nonresponsive any
proposer that makes a significant change to the composition of its
design-build team as initially submitted. The authority shall
subsequently open, evaluate, and score the cost proposals from
proposers that submitted a responsive technical proposal and assign
points on the basis of the weighting specified in the request for
detailed proposals. The authority shall rank the proposers in
accordance with the formula provided in the request for detailed
proposals.
Sec. 370.324. NEGOTIATION. (a) After ranking the
proposers under Section 370.323(i), an authority shall first
attempt to negotiate a contract with the highest-ranked proposer.
If an authority has committed to paying a stipend to unsuccessful
proposers in accordance with Section 370.325, an authority may
include in the negotiations alternative technical concepts
proposed by other proposers.
(b) If an authority is unable to negotiate a satisfactory
contract with the highest-ranked proposer, the authority shall,
formally and in writing, end all negotiations with that proposer
and proceed to negotiate with the next proposer in the order of the
selection ranking until a contract is reached or negotiations with
all ranked proposers end.
Sec. 370.325. STIPEND AMOUNT FOR UNSUCCESSFUL PROPOSERS.
(a) Unless a stipend is paid under Subsection (c), a proposer
retains all rights to the work product submitted in a response to a
request for detailed proposals. Except as required by order of a
governmental body or under Section 552.301(e), Government Code, an
authority may not release or disclose to any person, including the
successful proposer, the work product contained in an unsuccessful
proposal. An authority shall return all copies of the proposal and
other information submitted by an unsuccessful proposer. An
authority or its agents may not make use of any unique or
nonordinary design element, technique, method, or process
contained in an unsuccessful proposal that was not also contained
in the highest-ranked proposal at the time of the original
submittal, unless a stipend is paid to the unsuccessful proposer or
the highest-ranked proposer otherwise acquires a license from the
unsuccessful proposer.
(b) In the event of a violation of this section, the
highest-ranked proposer shall be liable to any unsuccessful
proposer for one-half of the cost savings associated with the
unauthorized use of the work product of the unsuccessful proposer.
(c) An authority may offer an unsuccessful proposer that
submits a responsive proposal to the request for detailed proposals
a stipend for work associated with the development of the proposal.
The stipend must be a minimum of two-tenths of one percent of the
contract amount and must be specified in the initial request for
detailed proposals. After payment of the stipend, the authority
may make use of any work product contained in the unsuccessful
proposal, including the techniques, methods, processes, and
information contained in the proposal. The use by the authority of
any design element contained in an unsuccessful proposal is at the
sole risk and discretion of the authority and does not confer
liability on the recipient of the stipend under this subsection.
Sec. 370.326. PERFORMANCE OR PAYMENT BOND.
(a) Notwithstanding the requirements of Subchapter B, Chapter
2253, Government Code, an authority shall require a design-build
contractor to provide a performance and payment bond or an
alternative form of security.
(b) 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) A payment or performance bond is not required for the
portion of a design-build contract under this section that includes
design services only.
(d) 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;
(3) an irrevocable bank letter of credit; or
(4) any other form of security determined suitable by
the authority.
SECTION 3. Subsections (d) and (e), Section 370.305, and
Section 370.314, Transportation Code, are repealed.
SECTION 4. 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 on the 91st day after the last day of the
legislative session.
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