84R28652 YDB-D
By: Nelson, et al. S.B. No. 20
(Price, Cook, Raymond, Kuempel)
Substitute the following for S.B. No. 20: No.
A BILL TO BE ENTITLED
AN ACT
relating to state agency contracting; authorizing fees; creating an
offense.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 321.013, Government Code, is amended by
adding Subsections (k) and (l) to read as follows:
(k) In devising the audit plan under Subsection (c), the
State Auditor shall consider the performance of audits on contracts
entered into by the Health and Human Services Commission that
exceed $100 million in annual value, including a contract between
the commission and a managed care organization. The State Auditor
shall collaborate with the financial managers in the Medicaid/CHIP
Division of the commission in performing an audit described by this
subsection. An audit described by this subsection:
(1) may be limited in scope to target an area of the
contract that the State Auditor determines poses the highest
financial risk to this state; and
(2) must determine whether the entity contracting with
the commission has spent state money in accordance with the
purposes authorized in the contract.
(l) The State Auditor may contract with a private auditor to
audit a contract under Subsection (k).
SECTION 2. Subchapter B, Chapter 403, Government Code, is
amended by adding Section 403.03057 to read as follows:
Sec. 403.03057. CENTRALIZED STATE PURCHASING STUDY.
(a) The comptroller, in cooperation with the governor's budget and
policy staff, shall conduct a study examining the feasibility and
practicality of consolidating state purchasing functions into
fewer state agencies or one state agency. The study must examine
the cost savings to this state that may be achieved through:
(1) abolishing offices or departments of state
agencies that have a dedicated office or department for purchasing;
and
(2) consolidating or reducing the number of vendors
authorized to contract with this state to allow this state to better
leverage its purchasing power.
(b) The comptroller shall prepare and deliver to the
governor, the lieutenant governor, and each member of the
legislature a report on the findings of the study conducted under
Subsection (a), including:
(1) a detailed projection of expected savings or costs
to this state in consolidating state purchasing;
(2) a report on the process for the legislature or the
executive branch to implement the consolidation of state
purchasing;
(3) a list of state agencies, including dedicated
offices or departments in those agencies, with purchasing
responsibilities; and
(4) the total cost to this state of the purchasing
responsibilities for each state agency, including the dedicated
office or department in the agency with purchasing responsibility.
(c) The comptroller shall prepare, deliver, and post on the
comptroller's Internet website the report required by this section
not later than December 31, 2016.
(d) The comptroller may contract with a public or private
entity to conduct the study required by this section.
(e) This section expires January 1, 2018.
SECTION 3. 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 seventh anniversary of the date:
(A) the contract is completed or expires; or
(B) all issues that arise from any litigation,
claim, negotiation, audit, open records request, administrative
review, or other action involving the contract or documents are
resolved.
SECTION 4. Subchapter C, Chapter 572, Government Code, is
amended by adding Section 572.069 to read as follows:
Sec. 572.069. CERTAIN EMPLOYMENT FOR FORMER STATE OFFICER
OR EMPLOYEE RESTRICTED; CRIMINAL PENALTY. (a) A former state
officer or employee of a state agency who during the period of state
service or employment participated on behalf of a state agency as an
evaluation team member or other decision maker in determining the
person to whom a contract should be awarded during the procurement
or contract negotiation may not accept employment from that person
before the second anniversary of the date the officer's or
employee's service or employment with the state agency ceased.
(b) An individual commits an offense if the individual
violates this section. An offense under this subsection is a Class
A misdemeanor.
SECTION 5. Subchapter C, Chapter 2054, Government Code, is
amended by adding Section 2054.067 to read as follows:
Sec. 2054.067. POSTING OF CERTAIN DOCUMENTS RELATING TO
CONTRACT SOLICITATIONS. (a) The department shall post all
solicitation documents related to a contract of the department,
including contracts under Chapter 2157, to the centralized
accounting and payroll system authorized under Sections 2101.035
and 2101.036, or any successor system used to implement the
enterprise resource planning component of the uniform statewide
accounting project.
(b) The documents posted under Subsection (a) must include
documents showing the criteria by which the department evaluated
each vendor responding to the contract solicitation and, if
applicable, an explanation of why the vendor was selected by the
department under Section 2157.068(b).
SECTION 6. Section 2101.001(1), Government Code, is amended
to read as follows:
(1) "Enterprise resource planning" includes the
administration of a state agency's:
(A) general ledger;
(B) accounts payable;
(C) accounts receivable;
(D) budgeting;
(E) inventory;
(F) asset management;
(G) billing;
(H) payroll;
(I) projects;
(J) grants;
(K) human resources, including administration of
performance measures, time spent on tasks, and other personnel and
labor issues; and
(L) purchasing, including solicitations and
contracting.
SECTION 7. Section 2101.035, Government Code, is amended by
adding Subsection (i) to read as follows:
(i) State agencies shall report contract and purchasing
information in the uniform manner required by the comptroller.
SECTION 8. Section 2101.036, Government Code, is amended by
adding Subsection (e) to read as follows:
(e) Notwithstanding Subsection (d), a state agency in the
legislative branch may elect to participate in the enterprise
resource planning system developed under this section.
SECTION 9. Subchapter C, Chapter 2101, Government Code, is
amended by adding Section 2101.041 to read as follows:
Sec. 2101.041. STATE AGENCY REPORTING OF CONTRACTING
INFORMATION. (a) The comptroller by rule shall determine the
contracting information that state agencies must report or provide
using the centralized accounting and payroll system, or any
successor system used to implement the enterprise resource planning
component of the uniform statewide accounting project, developed
under Sections 2101.035 and 2101.036.
(b) In making the determination required by this section,
the comptroller shall consider requiring a state agency to report
or provide:
(1) a brief summary of each contract that is quickly
and easily searchable, including the contract's purpose, timeline,
and deliverables;
(2) contract planning and solicitation documents;
(3) the criteria used to determine the vendor awarded
the contract;
(4) if the contract was awarded based on best value to
the state:
(A) a list of the factors considered in
determining best value with the weight given each factor; and
(B) a statement regarding how the vendor awarded
the contract provides the best value to the state in relation to
other vendors who bid or otherwise responded to the contract
solicitation;
(5) any statements of work and work orders prepared
for or under the contract;
(6) the proposed budget for the contract;
(7) any conflict of interest documents signed by state
agency purchasing personnel participating in the planning,
soliciting, or monitoring of the contract; and
(8) criteria used or to be used by the state agency in
monitoring the contract and vendor performance under the contract.
SECTION 10. Subchapter B, Chapter 2155, Government Code, is
amended by adding Section 2155.0755 to read as follows:
Sec. 2155.0755. VERIFICATION OF USE OF BEST VALUE STANDARD.
(a) The contract manager or procurement director of each state
agency shall:
(1) approve each state agency contract for which the
agency is required to purchase goods or services using the best
value standard;
(2) ensure that, for each contract, the agency
documents the best value standard used for the contract; and
(3) acknowledge in writing that the agency complied
with the agency's and comptroller's contract management guide in
the purchase.
(b) For each purchase of goods or services for which a state
agency is required to use the best value standard, the comptroller
shall ensure that the agency includes in the vendor performance
tracking system established under Section 2262.055 information on
whether the vendor satisfied that standard.
SECTION 11. Section 2155.077, Government Code, is amended
by amending Subsections (a) and (b) and adding Subsection (a-2) to
read as follows:
(a) The commission may bar a vendor from participating in
state contracts that are subject to this subtitle, including
contracts for which purchasing authority is delegated to a state
agency, for:
(1) substandard performance under a contract with the
state or a state agency;
(2) material misrepresentations in a bid or proposal
to the state or a state agency or during the course of performing a
contract with the state or a state agency;
(3) fraud; [or]
(4) breaching a contract with the state or a state
agency; or
(5) repeated unfavorable performance reviews under
Section 2155.089 or receipt of an unfavorable classification given
by the comptroller under Section 2262.055.
(a-2) The comptroller shall bar a vendor from participating
in state contracts that are subject to this subtitle, including
contracts for which purchasing authority is delegated to a state
agency, if more than two contracts between the vendor and the state
have been terminated by the state.
(b) Except as provided by Subsection (d), the commission
shall bar a vendor from participating in state contracts under
Subsection (a) or (a-2) for a period that is commensurate with the
seriousness of the vendor's action and the damage to the state's
interests.
SECTION 12. 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 13. Subchapter B, Chapter 2155, Government Code, is
amended by adding Section 2155.089 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 established by Section 2262.055, on the results
of the review regarding a vendor's performance under a contract.
(c) This section does not apply to:
(1) an enrollment contract described by 1 T.A.C.
Section 391.183 as that section existed on September 1, 2015; or
(2) a contract of the Employees Retirement System of
Texas or the Teacher Retirement System of Texas except for a
contract with a nongovernmental entity for claims administration of
a group health benefit plan under Subtitle H, Title 8, Insurance
Code.
SECTION 14. 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 or services under a contract listed
on the schedule:
(1) for a purchase with a value of $50,000 or less, may
directly award a contract to a vendor included on the schedule
without submission of a request for pricing to other vendors on the
list;
(2) for a purchase with a value of more than $50,000
but not more than $150,000, shall submit a request for pricing to at
least three vendors included on the schedule in the category to
which the purchase relates or to all vendors in the category for a
category with fewer than three vendors;
(3) for a purchase with a value of more than $150,000
but not more than $1 million, shall submit a request for pricing to
at least six vendors included on the schedule in the category to
which the purchase relates or all vendors in the category for a
category with fewer than six vendors; and
(4) may not purchase under the contract services in a
state fiscal year that have a total value exceeding $1 million.
(b) The price listed for a good or service under a multiple
award contract is a maximum price. A state agency may negotiate a
lower price for goods or services under a contract listed on a
schedule developed under this chapter.
SECTION 15. Section 2156.181(a), Government Code, is
amended to read as follows:
(a) The commission may enter into one or more compacts,
interagency agreements, or cooperative purchasing agreements
directly with one or more state governments, agencies of other
states, or other governmental entities or may participate in,
sponsor, or administer a cooperative purchasing agreement through
an entity that facilitates those agreements for the purchase of
goods or services if the commission determines that the [entering
into an] agreement would be in the best interest of the state.
SECTION 16. Subchapter B, Chapter 2157, Government Code, is
amended by adding Section 2157.0685 to read as follows:
Sec. 2157.0685. CONTRACT REQUIREMENTS FOR CERTAIN
SERVICES. (a) In this section, "statement of work" means a
document that states the requirements for a contract, including
deliverables, performance specifications, and other requirements,
specific to the vendor under that contract that are not specified in
a contract awarded by the department under Section 2157.068 for
contracts more than $50,000.
(b) For a contract awarded by the department under Section
2157.068 that requires a state agency to develop and execute a
statement of work to initiate services under the contract, the
state agency must:
(1) consult with the department before submission of
the statement of work to a vendor; and
(2) post each statement of work entered into by the
agency on the agency's Internet website in the manner required by
department rule.
(c) A statement of work executed by a state agency under a
contract awarded by the department under Section 2157.068 is not
valid and money may not be paid to the vendor under the terms of the
statement of work if the department:
(1) has not reviewed the statement of work; or
(2) disapproves the statement of work before the
contract solicitation.
SECTION 17. Section 2261.001(a), Government Code, is
amended to read as follows:
(a) This chapter, other than Subchapter F, 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 18. 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. (a)
Notwithstanding Section 2261.001, this subchapter applies to the
Texas Department of Transportation.
(b) This subchapter does not apply to a contract of the
Employees Retirement System of Texas or the Teacher Retirement
System of Texas except for a contract with a nongovernmental entity
for claims administration of a group health benefit plan under
Subtitle H, Title 8, Insurance Code.
Sec. 2261.252. 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:
(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.
(d) This section does not apply to a memoranda of
understanding, interagency contract, interlocal agreement, or
contract for which there is not a cost.
Sec. 2261.253. 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).
(e) A highway construction, engineering services, or
maintenance contract that is in compliance with all applicable laws
related to procuring engineering services or construction bidding
and that is awarded by the Texas Department of Transportation under
Subchapter A, Chapter 223, Transportation Code, is not required to
be signed by a member of the Texas Transportation Commission or the
executive director of the department. This exception does not
apply to expedited highway improvement contracts under Subchapter
C, Chapter 223, Transportation Code, a comprehensive development
agreement entered into under Subchapter E, Chapter 223,
Transportation Code, a design-build contract entered into under
Subchapter F, Chapter 223, Transportation Code, or any other
contract entered into by the Texas Department of Transportation.
Sec. 2261.254. 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. 2261.255. ACCOUNTABILITY AND RISK ANALYSIS PROCEDURE;
CONTRACT MANAGEMENT HANDBOOK. (a) Each state agency shall develop
and comply with a purchasing accountability and 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;
(2) identifying contracts that require enhanced
contract monitoring or the immediate attention of contract
management staff; and
(3) establishing clear levels of purchasing
accountability and staff responsibilities related to purchasing.
(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 procedures
described by Subsections (a)(2) and (3) must be approved by the
comptroller and be included in the agency's handbook. The agency's
handbook may include standard contract provisions and formats for
the agency to incorporate in contracts.
Sec. 2261.256. CONTRACT DATABASE. (a) Each state agency
that becomes a participant in the centralized accounting and
payroll systems as authorized by Sections 2101.035 and 2101.036
shall use the system to identify and record each contract entered
into by the agency as specified by the rules, policies, or
procedures developed by the comptroller.
(b) The comptroller shall provide as necessary information
and state agency contract data contained in the centralized
accounting and payroll systems to other state agencies with
oversight duties, including the Legislative Budget Board, the state
auditor's office, and the Department of Information Resources.
SECTION 19. Section 2262.053(d), Government Code, is
amended to read as follows:
(d) The comptroller shall administer training under this
section and may assess a fee for the training in an amount
sufficient to recover the comptroller's costs under this section.
SECTION 20. Section 2262.0535, Government Code, is amended
by adding Subsection (c) to read as follows:
(c) The comptroller may assess a fee for the training
provided under this section in an amount sufficient to recover the
comptroller's costs under this section.
SECTION 21. Section 2262.055, Government Code, is amended
by amending Subsections (a) and (b) and adding Subsections (d) and
(e) to read as follows:
(a) The comptroller shall evaluate the vendor's performance
based on information reported by state agencies under Section
2155.089 and criteria established by the comptroller.
(b) The comptroller by rule shall establish an evaluation
process that:
(1) rates vendors on an A through F scale, with A being
the highest grade; and
(2) allows vendors who receive a grade lower than a C
[an unfavorable performance review] to protest any classification
given by the comptroller.
(d) A state agency shall use the vendor performance tracking
system to determine whether to award a contract to a vendor reviewed
in the tracking system. A state agency may not award a contract to a
vendor who receives a grade lower than a C from the comptroller
under Subsection (b).
(e) The comptroller shall make the vendor performance
tracking system accessible to the public on the comptroller's
Internet website.
SECTION 22. Section 2155.502(d), Government Code, is
repealed.
SECTION 23. 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,
processes, and procedures and take the actions necessary to
implement the changes in law made by this Act.
SECTION 24. Section 572.069, Government Code, as added by
this Act, applies only to a state officer or employee whose service
or employment with a state agency ceases on or after the effective
date of this Act.
SECTION 25. Section 2262.055(d), Government Code, as added
by this Act, applies only in relation to a contract for which the
request for bids or proposals or other applicable expression of
interest is made public on or after October 1, 2015.
SECTION 26. 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 27. This Act takes effect September 1, 2015.