By: Turner H.B. No. 579
A BILL TO BE ENTITLED
AN ACT
relating to notice by a state agency regarding certain contracts
for which the total value exceeds that of the initial contract.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter F, Chapter 2261, Government Code, is
amended by adding Section 2261.2555 to read as follows:
Sec. 2261.2555. NOTICE OF CERTAIN COST THAT EXCEEDS
CONTRACT AMOUNT; ENFORCEMENT. (a) Subject to Subsection (a-1),
for each state agency contract to purchase services from a vendor
for which the total value of the contract after any contract
amendment exceeds the total value of the initial contract by the
greater of five percent or more or $1 million or more, the state
agency in accordance with procedures established by the Legislative
Budget Board shall provide notice of the excessive cost to:
(1) the governor;
(2) the lieutenant governor;
(3) the speaker of the house of representatives;
(4) each member of the legislature;
(5) the board; and
(6) the state auditor's office.
(a-1) Subsection (a) applies only to a contract the cost of
which is paid for with appropriated funds.
(b) The state agency must provide the notice required under
Subsection (a) not later than the 30th day after the date of the
disclosure or discovery that the expected total value of the
contract after any contract amendment exceeds the total value of
the initial contract by the greater of five percent or more or $1
million. The notice must include:
(1) the amount of the cost increase;
(2) the reason for the cost increase;
(3) any opportunity the state agency had to lessen the
cost or to purchase the service from another vendor after the first
discovery or disclosure of any cost increase to the agency; and
(4) any other information the Legislative Budget Board
determines relevant.
(c) The Legislative Budget Board may assess an enforcement
mechanism against a state agency that the board determines has
failed to provide notice as required by this section. The
enforcement mechanism must be assessed in accordance with the
schedule developed under Subsection (d).
(d) The Legislative Budget Board may establish a schedule of
enforcement mechanisms that may be assessed against a state agency
for a violation described by Subsection (c). The enforcement
mechanisms may include:
(1) enhanced monitoring of the state agency's
contracts by board personnel;
(2) required consultation with the Contract Advisory
Team established under Section 2262.101 or the quality assurance
team established under Section 2054.158 before issuance of a
contract by the state agency;
(3) targeted audits by the state auditor's office at
the request of the board; and
(4) recommended cancellation of a contract to purchase
services from a vendor for which the total value of the contract
after any contract amendment exceeds the total value of the initial
contract by the greater of five percent or more or $1 million or
more.
(e) The Legislative Budget Board's director may recommend
to the board an enforcement mechanism to be assessed against a state
agency for a violation described by Subsection (c). The board may
increase the severity of an enforcement mechanism assessed against
a state agency for repeated violations.
(f) The Legislative Budget Board may dismiss an enforcement
mechanism assessed against a state agency by the board for a
violation described by Subsection (c) on successful implementation
of corrective action approved by the board.
SECTION 2. 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 3. This Act takes effect September 1, 2017.