By: Price H.B. No. 3241
A BILL TO BE ENTITLED
AN ACT
relating to state agency contracting.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter L, Chapter 441, Government Code, is
amended by adding Section 441.1855 to read as follows:
Sec. 441.1855. RETENTION OF CONTRACT AND RELATED DOCUMENTS
BY STATE AGENCIES. Notwithstanding Section 441.185 or 441.187, a
state agency:
(1) shall retain in its records each contract entered
into by the state agency and all contract solicitation documents
related to the contract; and
(2) may destroy the contract and documents only after
the fourth anniversary of the date the contract is completed or
expires.
SECTION 2. Section 2151.002, Government Code, is amended to
read as follows:
Sec. 2151.002. DEFINITION. Except as otherwise provided by
this subtitle, in this subtitle, "state agency" means:
(1) a department, commission, board, office, or other
agency in the executive branch of state government created by the
state constitution or a state statute;
(2) the supreme court, the court of criminal appeals,
a court of appeals, or the Texas Judicial Council; or
(3) a university system or an institution of higher
education as defined by Section 61.003, Education Code[, except a
public junior college].
SECTION 3. Section 2155.078, Government Code, is amended by
amending Subsections (a) and (b) and adding Subsection (a-1) to
read as follows:
(a) The commission shall establish and administer a system
of training, continuing education, and certification for state
agency purchasing personnel. The training and continuing education
for state agency purchasing personnel must include ethics training.
The commission may establish and offer appropriate training to
vendors on a cost recovery basis. The commission may adopt rules to
administer this section, including rules relating to monitoring a
certified purchaser's compliance with the continuing education
requirements of this section.
(a-1) The training, continuing education, and certification
required under Subsection (a) must include:
(1) training on the selection of an appropriate
procurement method by project type; and
(2) training conducted by the Department of
Information Resources on purchasing technologies.
(b) Notwithstanding [Except as provided by] Subsection (n),
all state agency purchasing personnel, including agencies exempted
from the purchasing authority of the commission, must receive the
training and continuing education to the extent required by rule of
the commission. The training and continuing education must include
ethics training. A state agency employee who is required to receive
the training may not participate in purchases by the employing
agency unless the employee has received the required training or
received equivalent training from a national association
recognized by the commission. The equivalent training may count,
as provided by Subsection (k), toward the continuing education
requirements.
SECTION 4. Subchapter B, Chapter 2155, Government Code, is
amended by adding Sections 2155.089 and 2155.090 to read as
follows:
Sec. 2155.089. REPORTING VENDOR PERFORMANCE. (a) After a
contract is completed or otherwise terminated, each state agency
shall review the vendor's performance under the contract.
(b) The state agency shall report to the comptroller, using
the tracking system described by Section 2155.090, on the results
of the review regarding a vendor's performance under a contract.
Sec. 2155.090. VENDOR PERFORMANCE TRACKING SYSTEM. (a)
The comptroller shall evaluate a vendor's performance based on the
information reported under Section 2155.089 and criteria
established by the comptroller.
(b) The comptroller shall establish an evaluation process
that allows vendors who receive an unfavorable performance review
to protest any classification given by the comptroller.
(c) The comptroller shall include the performance reviews
in a vendor performance tracking system.
(d) A state agency shall use the vendor performance tracking
system to determine whether to award a contract to a vendor reviewed
in the database.
(e) The comptroller shall make the vendor performance
tracking system accessible to the public on the comptroller's
Internet website.
SECTION 5. Section 2155.502, Government Code, is amended by
amending Subsection (c) and adding Subsection (c-1) to read as
follows:
(c) The commission may not list a multiple award contract on
a schedule developed under Subsection (a) if the goods [or
services] provided by that contract:
(1) are available from only one vendor; or
(2) [are telecommunications services, facilities, or
equipment;
[(3)] are commodity items as defined by Section
2157.068(a); or
(3) have a value that exceeds $1 million [(4) are
engineering services as described by Section 1001.003, Occupations
Code, or architectural services as described by Section 1051.001,
Occupations Code].
(c-1) The list of multiple award contracts may not include
more than 35 percent of the number of vendors that competitively bid
to provide a particular good under a multiple award contract.
SECTION 6. Subchapter I, Chapter 2155, Government Code, is
amended by adding Section 2155.5035 to read as follows:
Sec. 2155.5035. USE OF SCHEDULE BY STATE AGENCY. (a) A
state agency purchasing goods under a contract listed on the
schedule shall:
(1) for a purchase with a value of $50,000 or less,
directly award a contract to a vendor included on the schedule
without submission of a request for bids to other vendors on the
list;
(2) for a purchase with a value of more than $50,000
but not more than $150,000, submit a request for proposals to at
least three vendors included on the schedule in the category to
which the purchase relates;
(3) for a purchase with a value of more than $150,000
but not more than $1 million, submit a request for proposals to at
least six vendors included on the schedule in the category to which
the purchase relates; and
(b) The price listed for a good under a multiple award
contract is a maximum price. A state agency may negotiate a lower
price for goods under a contract listed on a schedule developed
under this chapter.
SECTION 7. Section 2155.504, Government Code, is amended to
read as follows:
Sec. 2155.504. USE OF SCHEDULE BY GOVERNMENTAL ENTITIES.
(a) A [state agency or] local government may purchase goods [or
services] directly from a vendor under a contract listed on a
schedule developed under this subchapter. A purchase authorized by
this section satisfies any requirement of state law relating to
competitive bids or proposals and satisfies any applicable
requirements of Chapter 2157.
(b) The price listed for a good [or service] under a
multiple award contract is a maximum price. A [An agency or] local
government may negotiate a lower price for goods [or services]
under a contract listed on a schedule developed under this
subchapter.
SECTION 8. Section 2155.505(a)(3), Government Code, is
amended to read as follows:
(3) "Veterans service agency" means a community-based
organization that:
(A) is exempt from taxation under Section 501(a),
Internal Revenue Code of 1986, as an organization described in
Section 501(c)(3) of that code;
(B) has as its principal purpose to provide
housing, substance abuse treatment, case management services, and
employment training to low-income veterans, disabled veterans, and
homeless veterans and their families; and
(C) employs veterans to provide at least 75
percent of the hours of direct labor by individuals required to
produce goods [or provide services] required under a contract
entered into under this section.
SECTION 9. Sections 2155.505(b) and (c), Government Code,
are amended to read as follows:
(b) The commission shall strongly encourage each vendor
with a contract listed on a schedule developed under this
subchapter and who is not a historically underutilized business or
small business to use historically underutilized or small
businesses to sell goods [or provide a service] under the contract.
If a vendor does not make a good faith effort to use historically
underutilized and small businesses under the contract, the
commission may exclude the vendor from being listed on a schedule
developed under this subchapter.
(c) A historically underutilized business or small business
may sell goods [or provide a service] under another vendor's
contract listed on a schedule developed under this subchapter if:
(1) the contract is on a schedule developed under
Section 2155.502;
(2) the vendor for the contract authorizes in writing
the historically underutilized business or small business to sell
goods [or provide a service] under that contract; and
(3) the historically underutilized business or small
business provides that written authorization to the commission.
SECTION 10. Section 2157.068, Government Code, is amended
by amending Subsection (a) and adding Subsections (e-1) and (e-2)
to read as follows:
(a) In this section, "commodity items" means commercial
software or[,] hardware[, or technology services, other than
telecommunications services,] that is [are] generally available to
businesses or the public and for which the department determines
that a reasonable demand exists in two or more state agencies. The
term includes seat management, through which a state agency
transfers its personal computer equipment and service
responsibilities to a private vendor to manage the personal
computing needs for each desktop in the state agency, including all
necessary hardware, software, and support services.
(e-1) A state agency contracting to purchase a commodity
item shall use the list maintained as required by Subsection (e) as
follows:
(1) for a contract with a value of $50,000 or less, the
agency may directly award the contract to a vendor included on the
list without submission of a request for bids to other vendors on
the list;
(2) for a contract with a value of more than $50,000
but not more than $150,000, the agency must submit a request for
proposals to at least three vendors included on the list in the
category to which the contract relates;
(3) for a contract with a value of more than $150,000
but not more than $1 million, the agency must submit a request for
proposals to at least six vendors included on the list in the
category to which the contract relates; and
(e-2) A state agency may not enter into a contract to
purchase a commodity item if the value of the contract exceeds $1
million.
SECTION 11. Subchapter Z, Chapter 2252, Government Code, is
amended by adding Section 2252.9011 to read as follows:
Sec. 2252.9011. CONTRACTS WITH FORMER OR RETIRED PRIVATE
VENDOR EMPLOYEES. A state agency may not enter into an employment
contract, a professional services contract under Chapter 2254, or a
consulting services contract under Chapter 2254 with an individual
who is a former or retired employee of a private vendor under which
the individual will perform services for the agency related to the
individual's former duties for the vendor under a contract with the
agency before the second anniversary of the last date on which the
individual was employed by the private vendor.
SECTION 12. Section 2254.021(6), Government Code, is
amended to read as follows:
(6) "State governmental entity" means a state
department, commission, board, office, institution, facility, or
other agency the jurisdiction of which is not limited to a
geographical portion of the state. The term includes a university
system and an institution of higher education[, other than a public
junior college,] as defined by Section 61.003, Education Code. The
term does not include a political subdivision.
SECTION 13. Section 2261.001(a), Government Code, is
amended to read as follows:
(a) This chapter applies only to each procurement of goods
or services made by a state agency that is neither made by the
comptroller nor made under purchasing authority delegated to the
agency [by or] under [Section 51.9335 or 73.115, Education Code,
or] Section 2155.131 or 2155.132.
SECTION 14. Chapter 2261, Government Code, is amended by
adding Subchapter F to read as follows:
SUBCHAPTER F. ETHICS, REPORTING, AND APPROVAL REQUIREMENTS FOR
CERTAIN CONTRACTS
Sec. 2261.251. APPLICABILITY OF SUBCHAPTER. Section
2261.001 does not apply to this subchapter.
Sec. 2261.252. DISCLOSURE OF POTENTIAL CONFLICTS OF
INTEREST; CERTAIN CONTRACTS PROHIBITED. (a) Each state agency
employee or official who is involved in procurement or in contract
management for a state agency shall disclose to the agency any
potential conflict of interest specified by state law or agency
policy that is known by the employee or official with respect to any
contract with a private vendor or bid for the purchase of goods or
services from a private vendor by the agency.
(b) A state agency may not enter into a contract for the
purchase of goods or services with a private vendor with whom any of
the following agency employees or officials have a financial
interest:
(1) a member of the agency's governing body;
(2) the governing official, executive director,
general counsel, chief procurement officer, or procurement
director of the agency; or
(3) a family member related to an employee or official
described by Subdivision (1) or (2) within the second degree by
affinity or consanguinity.
(c) A state agency employee or official has a financial
interest in a person if the employee or official:
(1) owns or controls, directly or indirectly, an
ownership interest of at least one percent in the person, including
the right to share in profits, proceeds, or capital gains; or
(2) could reasonably foresee that a contract with the
person could result in a financial benefit to the employee or
official.
(d) A financial interest prohibited by this section does not
include a retirement plan, blind trust, insurance coverage, or
ownership interest of less than one percent in a corporation.
Sec. 2261.253. REQUIRED POSTING OF CERTAIN CONTRACTS;
ENHANCED CONTRACT AND PERFORMANCE MONITORING. (a) For each
contract for the purchase of goods or services from a private
vendor, each state agency shall post on its Internet website a list
of:
(1) each contract the agency enters into, including
contracts entered into without inviting, advertising for, or
otherwise requiring competitive bidding before selection of the
contractor, until the contract expires or is completed;
(2) the statutory or other authority under which a
contract that is not competitively bid under Subdivision (1) is
entered into without compliance with competitive bidding
procedures; and
(3) the request for proposals related to a
competitively bid contract included under Subdivision (1) until the
contract expires or is completed.
(b) A state agency monthly may post contracts described by
Subsection (a) that are valued at less than $15,000.
(c) Each state agency by rule shall establish a procedure to
identify each contract that requires enhanced contract or
performance monitoring and submit information on the contract to
the agency's governing body or, if the agency is not governed by a
multimember governing body, the officer who governs the agency.
The agency's contract management office or procurement director
shall immediately notify the agency's governing body or governing
official, as appropriate, of any serious issue or risk that is
identified with respect to a contract monitored under this
subsection.
Sec. 2261.254. CONTRACTS WITH VALUE EXCEEDING $1 MILLION.
(a) For each contract for the purchase of goods or services that
has a value exceeding $1 million, a state agency shall develop and
implement contract reporting requirements that provide information
on:
(1) compliance with financial provisions and delivery
schedules under the contract;
(2) corrective action plans required under the
contract and the status of any active corrective action plan; and
(3) any liquidated damages assessed or collected under
the contract.
(b) Each state agency shall verify:
(1) the accuracy of any information reported under
Subsection (a) that is based on information provided by a
contractor; and
(2) the delivery time of goods or services scheduled
for delivery under the contract.
(c) Except as provided by Subsection (d), a state agency may
enter into a contract for the purchase of goods or services that has
a value exceeding $1 million only if:
(1) the governing body of the state agency approves
the contract and the approved contract is signed by the presiding
officer of the governing body; or
(2) for a state agency that is not governed by a
multimember governing body, the officer who governs the agency
approves and signs the contract.
(d) The governing body or governing official of a state
agency, as appropriate, may delegate to the executive director of
the agency the approval and signature authority under Subsection
(c).
Sec. 2261.255. CONTRACTS WITH VALUE EXCEEDING $5 MILLION.
For each state agency contract for the purchase of goods or services
that has a value exceeding $5 million, the contract management
office or procurement director of the agency must:
(1) verify in writing that the solicitation and
purchasing methods and contractor selection process comply with
state law and agency policy; and
(2) submit to the governing body of the agency, or
governing official of the agency if the agency is not governed by a
multimember governing body, information on any potential issue that
may arise in the solicitation, purchasing, or contractor selection
process.
Sec. 2261.256. RISK ANALYSIS PROCEDURE; CONTRACT
MANAGEMENT HANDBOOK; CONTRACT MANAGEMENT DATABASE. (a) Each state
agency shall develop and comply with a risk analysis procedure. The
procedure must provide for:
(1) assessing the risk of fraud, abuse, or waste in the
contractor selection process, contract provisions, and payment and
reimbursement rates and methods for the different types of goods
and services for which the agency contracts; and
(2) identifying contracts that require enhanced
contract monitoring.
(b) Each state agency shall publish a contract management
handbook that establishes consistent contracting policies and
practices to be followed by the agency and that is consistent with
the comptroller's contract management guide. The agency handbook
may include standard contract provisions and formats for the agency
to incorporate in contracts.
(c) Each state agency shall establish a central contract
management database that identifies each contract made with the
agency.
SECTION 15. Section 2262.001(5), Government Code, is
amended to read as follows:
(5) "State agency" has the meaning provided by Section
2056.001, except that the term includes a university system or an
institution of higher education as defined by Section 61.003,
Education Code.
SECTION 16. Sections 2262.101(a), (b), and (c), Government
Code, as amended by Chapters 676 (H.B. 1965) and 1227 (S.B. 1681),
Acts of the 83rd Legislature, Regular Session, 2013, are reenacted
and amended to read as follows:
(a) The Contract Advisory Team is created to assist state
agencies in improving contract management practices by:
(1) reviewing [and making recommendations on the]
solicitation documents and contract documents for contracts of
state agencies that have a value of at least $10 million, including
the value of any amendment to or extension of the contract
authorized in the contract that would increase the value of the
contract;
(2) reviewing any findings or recommendations made by
the state auditor, including those made under Section 2262.052(b),
regarding a state agency's compliance with the contract management
guide;
(3) providing recommendations to the comptroller
regarding:
(A) the development of the contract management
guide; and
(B) the training under Section 2262.053;
(4) providing recommendations and assistance to state
agency personnel throughout the contract management process;
(5) coordinating and consulting with the quality
assurance team established under Section 2054.158 on all contracts
relating to a major information resources project; [and]
(6) [(4)] developing and recommending policies and
procedures to improve state agency contract management practices;
(7) [(5)] developing and recommending procedures to
improve state agency contracting practices by including
consideration for best value; and
(8) [(6)] creating and periodically performing a risk
assessment to determine the appropriate level of management and
oversight of contracts by state agencies.
(b) The risk assessment created and performed [reviewed]
under Subsection (a)(8) [(a)(6)] must include[, but is not limited
to] the following criteria:
(1) the amount of appropriations to the agency;
(2) total contract value as a percentage of
appropriations to the agency; and [or]
(3) the impact of the functions and duties of the state
agency on the health, safety, and well-being of residents
[citizens].
(c) The comptroller shall oversee the activities of the
team, including ensuring that the team carries out its duties under
Subsections (a)(1), [Subsection] (a)(5), and (a)(7).
SECTION 17. Section 2262.102(a), Government Code, is
amended to read as follows:
Sec. 2262.102. MEMBERS. (a) The team consists of the
following nine [six] members:
(1) one member from the Health and Human Services
Commission;
(2) one member from the comptroller's office;
(3) one member from the Department of Information
Resources;
(4) one member from the Texas Facilities Commission;
(5) one member from the governor's office; [and]
(6) one member from a small state agency;
(7) one member from the Texas Department of
Transportation;
(8) one member from the Texas Education Agency; and
(9) one member from the Texas Commission on
Environmental Quality.
SECTION 18. Subchapter C, Chapter 2262, Government Code, is
amended by adding Section 2262.105 to read as follows:
Sec. 2262.105. QUARTERLY REPORT TO LEGISLATIVE BUDGET
BOARD. The contract advisory team shall submit a quarterly report
to the Legislative Budget Board on:
(1) the number of solicitation documents and contracts
reviewed by the team in the preceding quarter;
(2) the number of documents and contracts reviewed
under Subdivision (1) compared to the total number of contracts
entered into by state agencies, expressed as a percentage; and
(3) whether state agencies accepted or rejected the
team's recommendations and any reasons provided by the state
agencies for rejecting the recommendations.
SECTION 19. The following provisions are repealed:
(1) Sections 51.9335(d) and 73.115(d), Education
Code; and
(2) Sections 2155.448(d), 2155.502(d), 2261.001(d),
and 2262.002(a), Government Code.
SECTION 20. (a) As soon as is practicable after the
effective date of this Act, the executive directors of the Texas
Department of Transportation, the Texas Education Agency, and the
Texas Commission on Environmental Quality shall each appoint a
member to the contract advisory team as required by Section
2262.102, Government Code, as amended by this Act.
(b) As soon as is practicable after the effective date of
this Act, the comptroller of public accounts, and each affected
state agency as necessary, shall adopt the rules and procedures and
take the actions necessary to implement the changes in law made by
this Act.
SECTION 21. To the extent of any conflict, this Act prevails
over another Act of the 84th Legislature, Regular Session, 2015,
relating to nonsubstantive additions to and corrections in enacted
codes.
SECTION 22. The changes in law made by this Act apply only
to a contract entered into on or after the effective date of this
Act. A contract entered into before that date is governed by the
law in effect immediately before the effective date of this Act, and
the former law is continued in effect for that purpose.
SECTION 23. This Act takes effect September 1, 2015.