Texas 2019 - 86th Regular

Texas Senate Bill SB65 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	S.B. No. 65
	1	+	86R27648 TSR-F
	2	+	By: Nelson, et al. S.B. No. 65
	3	+	(Geren)
	4	+	Substitute the following for S.B. No. 65: No.
2	5
3	6
	7	+	A BILL TO BE ENTITLED
4	8		AN ACT
5	9		relating to oversight of and requirements applicable to state
6	10		agency contracting and procurement.
7	11		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	12		SECTION 1. Section 441.1855, Government Code, is amended to
9	13		read as follows:
10	14		Sec. 441.1855. RETENTION OF CONTRACT AND RELATED DOCUMENTS
11	15		BY STATE AGENCIES. (a) Notwithstanding Section 441.185 or
12	16		441.187, a state agency:
13	17		(1) shall retain in its records each contract entered
14	18		into by the state agency and all contract solicitation documents
15	19		related to the contract; and
16	20		(2) may destroy the contract and documents only after
17	21		the seventh anniversary of the date:
18	22		(A) the contract is completed or expires; or
19	23		(B) all issues that arise from any litigation,
20	24		claim, negotiation, audit, open records request, administrative
21	25		review, or other action involving the contract or documents are
22	26		resolved.
23	27		(b) A contract solicitation document that is an electronic
24	28		document must be retained under Subsection (a) in the document's
25	29		electronic form. A state agency may print and retain the document
26	30		in paper form only if the agency provides for the preservation,
27	31		examination, and use of the electronic form of the document in
28	32		accordance with Subsection (a), including any formatting or
29	33		formulas that are part of the electronic format of the document.
30	34		(c) In this section:
31	35		(1) "Contract solicitation document" includes any
32	36		document, whether in paper form or electronic form, that is used by
33	37		a state agency to evaluate responses to a competitive solicitation
34	38		for a contract issued by the agency.
35	39		(2) "Electronic document" means:
36	40		(A) information that is created, generated,
37	41		sent, communicated, received, or stored by electronic means; or
38	42		(B) the output of a word processing, spreadsheet,
39	43		presentation, or business productivity application.
40	44		SECTION 2. Section 2054.003(10), Government Code, is
41	45		amended to read as follows:
42	46		(10) "Major information resources project" means:
43	47		(A) any information resources technology project
44	48		identified in a state agency's biennial operating plan whose
45	49		development costs exceed $5 [$1] million and that:
46	50		(i) requires one year or longer to reach
47	51		operations status;
48	52		(ii) involves more than one state agency;
49	53		or
50	54		(iii) substantially alters work methods of
51	55		state agency personnel or the delivery of services to clients; and
52	56		(B) any information resources technology project
53	57		designated by the legislature in the General Appropriations Act as
54	58		a major information resources project.
55	59		SECTION 3. Section 2054.055(b), Government Code, is amended
56	60		to read as follows:
57	61		(b) The report must:
58	62		(1) assess the progress made toward meeting the goals
59	63		and objectives of the state strategic plan for information
60	64		resources management;
61	65		(2) describe major accomplishments of the state or a
62	66		specific state agency in information resources management;
63	67		(3) describe major problems in information resources
64	68		management confronting the state or a specific state agency;
65	69		(4) provide a summary of the total expenditures for
66	70		information resources and information resources technologies by
67	71		the state;
68	72		(5) make recommendations for improving the
69	73		effectiveness and cost-efficiency of the state's use of information
70	74		resources;
71	75		(6) describe the status, progress, benefits, and
72	76		efficiency gains of the state electronic Internet portal project,
73	77		including any significant issues regarding contract performance;
74	78		(7) provide a financial summary of the state
75	79		electronic Internet portal project, including project costs and
76	80		revenues;
77	81		(8) provide a summary of the amount and use of
78	82		Internet-based training conducted by each state agency and
79	83		institution of higher education;
80	84		(9) provide a summary of agency and statewide results
81	85		in providing access to electronic and information resources to
82	86		individuals with disabilities as required by Subchapter M;
83	87		(10) assess the progress made toward accomplishing the
84	88		goals of the plan for a state telecommunications network and
85	89		developing a system of telecommunications services as provided by
86	90		Subchapter H; and
87	91		(11) identify proposed major information resources
88	92		projects for the next state fiscal biennium, including project
89	93		costs through stages of the project and across state fiscal years
90	94		from project initiation to implementation[;
91	95		[(12) examine major information resources projects
92	96		completed in the previous state fiscal biennium to determine the
93	97		performance of the implementing state agency, cost and value
94	98		effectiveness, timeliness, and other performance criteria
95	99		necessary to assess the quality and value of the investment; and
96	100		[(13) examine major information resources projects
97	101		after the second anniversary of the project's completion to
98	102		determine progress toward meeting performance goals and operating
99	103		budget savings].
100	104		SECTION 4. Section 2054.1181, Government Code, is amended
101	105		by amending Subsection (b) and adding Subsection (j) to read as
102	106		follows:
103	107		(b) In performing its duties under this section, the
104	108		department shall:
105	109		(1) develop policies for the additional oversight of
106	110		projects required by Subsection (a);
107	111		(2) implement project management standards;
108	112		(3) use effective risk management strategies;
109	113		(4) establish standards that promote the ability of
110	114		information resources systems to operate with each other; and
111	115		(5) use industry best practices and process
112	116		reengineering when feasible.
113	117		(j) A state agency may not amend a contract subject to
114	118		review under Section 2054.158(b)(4) if the contract is at least 10
115	119		percent over budget or the associated major information resources
116	120		project is at least 10 percent behind schedule unless the agency:
117	121		(1) conducts a cost-benefit analysis with respect to
118	122		canceling or continuing the project; and
119	123		(2) submits the analysis described by Subdivision (1)
120	124		to the quality assurance team.
121	125		SECTION 5. Section 2054.158, Government Code, is amended by
122	126		amending Subsection (b) and adding Subsections (d) and (e) to read
123	127		as follows:
124	128		(b) The quality assurance team shall:
125	129		(1) develop and recommend policies and procedures to
126	130		improve the development, implementation, and return on investment
127	131		for state agency information resources technology projects;
128	132		(2) except as provided by Subsection (e), review a
129	133		state agency's business case prepared for a major information
130	134		resources project under Section 2054.303 and make recommendations
131	135		[develop and recommend procedures] to improve the implementation of
132	136		the project [state agency information resources technology
133	137		projects by including considerations for best value and return on
134	138		investment]; [and]
135	139		(3) provide annual training for state agency
136	140		procurement and contract management staff on best practices and
137	141		methodologies for information technology contracts;
138	142		(4) review and provide recommendations on the final
139	143		negotiated terms of a contract for the development or
140	144		implementation of a major information resources project with a
141	145		value of at least $10 million; and
142	146		(5) provide a report to the governor, lieutenant
143	147		governor, speaker of the house of representatives, and presiding
144	148		officer of the standing committee of each house of the legislature
145	149		with primary jurisdiction over appropriations by December 1 of each
146	150		even-numbered year that includes:
147	151		(A) the performance indicator report required by
148	152		Section 2054.159(a);
149	153		(B) a summary of any major issues identified in
150	154		state agency reports submitted under Section 2054.159(f);
151	155		(C) an appendix containing any justifications
152	156		submitted to the quality assurance team under Section 2054.160(d);
153	157		and
154	158		(D) any additional information considered
155	159		appropriate by the quality assurance team.
156	160		(d) The comptroller by rule shall develop guidelines for the
157	161		additional or reduced monitoring of major information resources
158	162		projects and associated contracts of state agencies during the
159	163		periods described by Sections 2261.258(c)(2)(A), (B), and (C).
160	164		(e) The quality assurance team may waive the review
161	165		authorized by Subsection (b)(2) for any project for which the team
162	166		determines that a waiver of the review is appropriate because of the
163	167		project's associated risk.
164	168		SECTION 6. Section 2054.159, Government Code, is amended by
165	169		adding Subsections (f) and (g) to read as follows:
166	170		(f) For each major information resources project, a state
167	171		agency shall provide the quality assurance team any verification
168	172		and validation report or quality assurance report related to the
169	173		project not later than the 10th day after the date the agency
170	174		receives a request for the report.
171	175		(g) The quality assurance team may request any information
172	176		necessary to determine a major information resources project's
173	177		potential risk.
174	178		SECTION 7. Subchapter G, Chapter 2054, Government Code, is
175	179		amended by adding Section 2054.160 to read as follows:
176	180		Sec. 2054.160. REVIEW OF CONTRACT FOR MAJOR INFORMATION
177	181		RESOURCES PROJECT. (a) For each contract for the development or
178	182		implementation of a major information resources project with a
179	183		value of at least $10 million, a state agency shall:
180	184		(1) submit the proposed terms of the contract to the
181	185		quality assurance team before the start of negotiations; and
182	186		(2) submit the final negotiated unsigned contract to
183	187		the quality assurance team for review under Section 2054.158(b)(4).
184	188		(b) After the quality assurance team makes a recommendation
185	189		under Section 2054.158(b)(4), a state agency shall:
186	190		(1) comply with the recommendation; or
187	191		(2) submit to the quality assurance team a written
188	192		explanation regarding why the recommendation is not applicable to
189	193		the contract under review.
190	194		(c) Before amending a contract related to a major
191	195		information resources project, a state agency must notify the
192	196		governor, lieutenant governor, speaker of the house of
193	197		representatives, presiding officer of the standing committee of
194	198		each house of the legislature with primary jurisdiction over
195	199		appropriations, and quality assurance team if:
196	200		(1) the total value of the amended contract exceeds or
197	201		will exceed the initial contract value by 10 percent or more; or
198	202		(2) the amendment requires the contractor to provide
199	203		consultative services, technical expertise, or other assistance in
200	204		defining project scope or deliverables.
201	205		(d) A state agency shall provide to the quality assurance
202	206		team a justification for an amendment subject to Subsection (c).
203	207		SECTION 8. Section 2054.301, Government Code, is amended to
204	208		read as follows:
205	209		Sec. 2054.301. APPLICABILITY[; DEFINITION]. [(a)] This
206	210		subchapter applies only to[:
207	211		[(1)] a major information resources project[; and
208	212		[(2) a major contract].
209	213		[(b) In this subchapter, "major contract" means a major
210	214		contract as defined by Section 2262.001(4) under which a vendor
211	215		will perform or manage an outsourced function or process.]
212	216		SECTION 9. Section 2054.302(b), Government Code, is amended
213	217		to read as follows:
214	218		(b) The department[, in consultation with the Legislative
215	219		Budget Board and state auditor's office,] shall develop and provide
216	220		guidelines and forms for the documents required by this subchapter.
217	221		SECTION 10. Section 2054.303, Government Code, is amended
218	222		by amending Subsections (a) and (c) and adding Subsection (d) to
219	223		read as follows:
220	224		(a) For each proposed major information resources project
221	225		[or major contract], a state agency must prepare:
222	226		(1) a business case providing the initial
223	227		justification for the project [or contract, including the
224	228		anticipated return on investment in terms of cost savings and
225	229		efficiency for the project or contract]; and
226	230		(2) if the state agency has been assigned the rating
227	231		under Section 2261.258(a)(1):
228	232		(A) a statewide impact analysis of the project's
229	233		[or contract's] effect on the state's common information resources
230	234		infrastructure[, including the possibility of reusing code or other
231	235		resources]; and
232	236		(B) [(3) in consultation with the department,] a
233	237		technical architectural assessment of the project, if requested by
234	238		the quality assurance team [or contract].
235	239		(c) The department shall use the analysis to ensure that the
236	240		proposed project [or major contract] does not unnecessarily
237	241		duplicate existing statewide information resources technology.
238	242		(d) After the quality assurance team makes a recommendation
239	243		relating to a business case under Section 2054.158(b)(2), a state
240	244		agency shall:
241	245		(1) comply with the recommendation; or
242	246		(2) submit to the quality assurance team a written
243	247		explanation regarding why the recommendation is not applicable to
244	248		the project under review.
245	249		SECTION 11. Sections 2054.304(a) and (b), Government Code,
246	250		are amended to read as follows:
247	251		(a) A state agency shall develop a project plan for each
248	252		major information resources project [or major contract].
249	253		(b) The [Except as provided by Subsection (c), the] state
250	254		agency must file the project plan with the quality assurance team
251	255		and the department before the agency[:
252	256		[(1)] spends more than 10 percent of allocated funds
253	257		for the project [or major contract; or
254	258		[(2) first issues a vendor solicitation for the
255	259		project or contract].
256	260		SECTION 12. Section 2054.305, Government Code, is amended
257	261		to read as follows:
258	262		Sec. 2054.305. PROCUREMENT PLAN AND METHOD FOR MONITORING
259	263		CONTRACTS. Before issuing a [vendor] solicitation for a [project
260	264		or major] contract subject to review under Section 2054.158(b)(4),
261	265		the state agency must develop, consistent with any acquisition plan
262	266		provided in the guide developed under Section 2262.051 [department
263	267		guidelines]:
264	268		(1) a procurement plan with anticipated service levels
265	269		and performance standards for each contractor [vendor]; and
266	270		(2) a method to monitor changes to the scope of each
267	271		contract.
268	272		SECTION 13. Section 2054.307(a), Government Code, is
269	273		amended to read as follows:
270	274		(a) A state agency's executive director, or the executive
271	275		director's designee, [information resources manager, designated
272	276		project manager, and the agency employee in charge of information
273	277		security for the agency] must approve [and sign]:
274	278		(1) each document required by this subchapter; and
275	279		(2) if the department requires the approval [and
276	280		signatures], any other document related to this subchapter.
277	281		SECTION 14. Section 2102.005, Government Code, is amended
278	282		to read as follows:
279	283		Sec. 2102.005. INTERNAL AUDITING REQUIRED. (a) A state
280	284		agency shall conduct a program of internal auditing that includes:
281	285		(1) an annual audit plan that is prepared using risk
282	286		assessment techniques and that identifies the individual audits to
283	287		be conducted during the year; and
284	288		(2) periodic audits of the agency's major systems and
285	289		controls, including:
286	290		(A) accounting systems and controls;
287	291		(B) administrative systems and controls; and
288	292		(C) electronic data processing systems and
289	293		controls.
290	294		(b) In conducting the internal auditing program under
291	295		Subsection (a), a state agency shall consider methods for ensuring
292	296		compliance with contract processes and controls and for monitoring
293	297		agency contracts.
294	298		SECTION 15. Section 2155.089, Government Code, is amended
295	299		to read as follows:
296	300		Sec. 2155.089. REPORTING VENDOR PERFORMANCE. (a) After a
297	301		contract is completed or otherwise terminated, each state agency
298	302		shall review the vendor's performance under the contract. If the
299	303		value of the contract exceeds $5 million, the state agency shall
300	304		review the vendor's performance:
301	305		(1) at least once each year during the term of the
302	306		contract; and
303	307		(2) at each key milestone identified for the contract.
304	308		(b) The state agency shall report to the comptroller, using
305	309		the tracking system established by Section 2262.055, on the results
306	310		of each [the] review conducted under Subsection (a) regarding a
307	311		vendor's performance under a contract.
308	312		(b-1) A state agency may not extend a vendor's contract
309	313		until after the agency reports the results of each review of the
310	314		vendor conducted under Subsection (a)(1) or (2), as applicable, in
311	315		the manner prescribed by Subsection (b).
312	316		(c) This section does not apply to:
313	317		(1) an enrollment contract described by 1 T.A.C.
314	318		Section 391.183 as that section existed on September 1, 2015; [or]
315	319		(2) a contract of the Employees Retirement System of
316	320		Texas [or the Teacher Retirement System of Texas] except for a
317	321		contract with a nongovernmental entity for claims administration of
318	322		a group health benefit plan under Subtitle H, Title 8, Insurance
319	323		Code; or
320	324		(3) a contract entered into by:
321	325		(A) the comptroller under Section 2155.061; or
322	326		(B) the Department of Information Resources
323	327		under Section 2157.068.
324	328		SECTION 16. Section 2155.144, Government Code, is amended
325	329		by adding Subsection (b-2) to read as follows:
326	330		(b-2) The Health and Human Services Commission is delegated
327	331		the authority to procure goods and services related to a contract
328	332		for:
329	333		(1) a project to construct or expand a state hospital
330	334		operated by a health and human services agency or a state supported
331	335		living center as defined by Section 531.002, Health and Safety
332	336		Code; or
333	337		(2) a deferred maintenance project for a health
334	338		facility described by Subdivision (1).
335		-	SECTION 17. Section 2252.908(b), Government Code, is
336		-	amended to read as follows:
337		-	(b) This section applies only to a contract of a
338		-	governmental entity or state agency that:
339		-	(1) requires an action or vote by the governing body of
340		-	the entity or agency before the contract may be signed; [or]
341		-	(2) has a value of at least $1 million; or
342		-	(3) is for services that would require a person to
343		-	register as a lobbyist under Chapter 305.
344		-	SECTION 18. Section 2254.024(a), Government Code, is
	339	+	SECTION 17. Section 2254.024(a), Government Code, is
345	340		amended to read as follows:
346	341		(a) This subchapter does not apply to or discourage the use
347	342		of consulting services provided by:
348	343		(1) practitioners of professional services described
349	344		in Subchapter A;
350	345		(2) private legal counsel;
351	346		(3) investment counselors;
352	347		(4) actuaries;
353	348		(5) medical or dental services providers; or
354	349		(6) other consultants whose services are determined by
355	350		the governing board of a retirement system trust fund to be
356	351		necessary for the governing board to perform its constitutional
357	352		fiduciary duties[, except that the governing board shall comply
358	353		with Section 2254.030].
359		-	SECTION 19. The heading to Section 2254.029, Government
	354	+	SECTION 18. The heading to Section 2254.029, Government
360	355		Code, is amended to read as follows:
361	356		Sec. 2254.029. PUBLICATION IN STATE BUSINESS DAILY [TEXAS
362	357		REGISTER] BEFORE ENTERING INTO MAJOR CONSULTING SERVICES CONTRACT.
363		-	SECTION 20. Section 2254.029(a), Government Code, is
	358	+	SECTION 19. Section 2254.029(a), Government Code, is
364	359		amended to read as follows:
365	360		(a) Not later than the 30th day before the date it enters
366	361		into a major consulting services contract, a state agency must post
367	362		in the state business daily under Section 2155.083 [shall file with
368	363		the secretary of state for publication in the Texas Register]:
369	364		(1) an invitation for consultants to provide offers of
370	365		consulting services;
371	366		(2) the name of the individual who should be contacted
372	367		by a consultant that intends to make an offer;
373	368		(3) the closing date for the receipt of offers; and
374	369		(4) the procedure by which the state agency will award
375	370		the contract.
376		-	SECTION 21. (a) Section 2254.030, Government Code, is
377		-	amended to read as follows:
378		-	Sec. 2254.030. REQUIRED DISCLOSURE AND ITEMIZATION OF
379		-	CERTAIN EXPENDITURES RELATING TO LOBBYING ACTIVITIES [PUBLICATION
380		-	IN TEXAS REGISTER] AFTER ENTERING INTO A [MAJOR] CONSULTING
381		-	SERVICES CONTRACT. (a) A political subdivision that enters or has
382		-	entered into a contract for consulting services with a state
383		-	agency, regardless of whether the term of the contract has expired,
384		-	shall prominently display on the political subdivision's Internet
385		-	website the following regarding contracts for services that would
386		-	require a person to register as a lobbyist under Chapter 305:
387		-	(1) the execution dates;
388		-	(2) the contract duration terms, including any
389		-	extension options;
390		-	(3) the effective dates;
391		-	(4) the final amount of money the political
392		-	subdivision paid in the previous fiscal year; and
393		-	(5) a list of all legislation advocated for, on, or
394		-	against by all parties and subcontractors to the contract,
395		-	including the position taken on each piece of legislation in the
396		-	prior fiscal year.
397		-	(b) In lieu of displaying the items described by Subsections
398		-	(a)(1)-(5) regarding a contract for services that would require a
399		-	person to register as a lobbyist under Chapter 305, a political
400		-	subdivision may post on the political subdivision's Internet
401		-	website the contract for those services.
402		-	(c) Information required to be displayed on a political
403		-	subdivision's Internet website under this section is public
404		-	information subject to disclosure under Chapter 552.
405		-	(d) The proposed budget of a political subdivision
406		-	described by Subsection (a) must include, in a manner allowing for
407		-	as clear a comparison as practicable between those expenditures in
408		-	the proposed budget and actual expenditures for the same purpose in
409		-	the preceding year, a line item indicating expenditures for
410		-	directly or indirectly influencing or attempting to influence the
411		-	outcome of legislation or administrative action, as those terms are
412		-	defined in Section 305.002 [Not later than the 20th day after the
413		-	date of entering into a major consulting services contract, the
414		-	contracting state agency shall file with the secretary of state for
415		-	publication in the Texas Register:
416		-	[(1) a description of the activities that the
417		-	consultant will conduct;
418		-	[(2) the name and business address of the consultant;
419		-	[(3) the total value and the beginning and ending
420		-	dates of the contract; and
421		-	[(4) the dates on which documents, films, recordings,
422		-	or reports that the consultant is required to present to the agency
423		-	are due].
424		-	(b) Section 2254.030, Government Code, as amended by this
425		-	section, applies to a consulting services contract entered into by
426		-	a political subdivision before, on, or after the effective date of
427		-	this Act.
428		-	SECTION 22. Section 2254.031(a), Government Code, is
	371	+	SECTION 20. Section 2254.031(a), Government Code, is
429	372		amended to read as follows:
430	373		(a) A state agency that intends to renew, amend, or extend a
431	374		major consulting services contract shall[:
432	375		[(1) file with the secretary of state for publication
433	376		in the Texas Register the information required by Section 2254.030
434	377		not later than the 20th day after the date the contract is renewed
435	378		if the renewal contract is not a major consulting services
436	379		contract; or
437	380		[(2)] comply with Sections 2254.028 and 2254.029 if
438	381		the contract after the renewal, amendment, or extension [contract]
439	382		is a major consulting services contract.
440		-	SECTION 23. Subchapter B, Chapter 2261, Government Code, is
	383	+	SECTION 21. Subchapter B, Chapter 2261, Government Code, is
441	384		amended by adding Sections 2261.0525 and 2261.054 to read as
442	385		follows:
443	386		Sec. 2261.0525. CERTIFICATION OF VENDOR ASSESSMENT
444	387		PROCESS. (a) Before a state agency may award a contract to a
445	388		vendor, the agency's procurement director must review the process
446	389		and all documents used by the agency to assess each vendor who
447	390		responded to the solicitation. The procurement director must
448	391		certify in writing that:
449	392		(1) the agency assessed each vendor's response to the
450	393		solicitation using the evaluation criteria published in the
451	394		solicitation or, if applicable, the written evaluation criteria
452	395		established by the agency; and
453	396		(2) the final calculation of scoring of responses was
454	397		accurate.
455	398		(b) A state agency shall justify in writing any change in
456	399		the scoring of a vendor that occurs following the initial
457	400		assessment and scoring of responses. The written justification
458	401		must be reviewed by the agency's procurement director. The
459	402		procurement director shall certify in writing that the change in
460	403		scoring was appropriate.
461	404		(c) A state agency's procurement director may delegate to a
462	405		person whose position in the agency's procurement office is at
463	406		least equal to the position of contract manager the certification
464	407		authority under this section if the agency has met the conditions
465	408		prescribed by the comptroller under Section 2262.053(h).
466	409		(d) A written certification or justification required by
467	410		this section must be placed in the contract file.
468	411		Sec. 2261.054. STATEMENT REGARDING VENDOR SELECTION
469	412		REQUIRED FOR CERTAIN CONTRACT AWARDS. If a state agency awards a
470	413		contract to a vendor who did not receive the highest score in an
471	414		assessment process certified under Section 2261.0525, the agency
472	415		shall state in writing in the contract file the reasons for making
473	416		the award.
474		-	SECTION 24. The heading to Subchapter E, Chapter 2261,
	417	+	SECTION 22. The heading to Subchapter E, Chapter 2261,
475	418		Government Code, is amended to read as follows:
476	419		SUBCHAPTER E. CONTRACTOR OVERSIGHT AND LIABILITY
477		-	SECTION 25. Subchapter E, Chapter 2261, Government Code, is
	420	+	SECTION 23. Subchapter E, Chapter 2261, Government Code, is
478	421		amended by adding Section 2261.204 to read as follows:
479	422		Sec. 2261.204. LIABILITY PROVISIONS. (a) Each state
480	423		agency shall include in the contract file for each of its contracts
481	424		for goods or services subject to this chapter a written explanation
482	425		of the agency's decision to include or not include in the contract a
483	426		provision for liquidated damages or another form of liability for
484	427		damages caused by the contractor.
485	428		(b) A contract file must also include, if applicable, a
486	429		written justification for any provision in the contract that limits
487	430		the liability of a contractor for damages.
488	431		(c) If an extension of a state agency's contract described
489	432		by Subsection (a) modifies a provision for liquidated damages or
490	433		another provision relating to a contractor's liability for damages,
491	434		the agency must amend the written explanation or justification
492	435		required by this section to include a justification for the
493	436		modification.
494		-	SECTION 26. Section 2261.251(b), Government Code, is
	437	+	SECTION 24. Section 2261.251(b), Government Code, is
495	438		amended to read as follows:
496	439		(b) This subchapter does not apply to a contract of the
497	440		Employees Retirement System of Texas [or the Teacher Retirement
498	441		System of Texas] except for a contract with a nongovernmental
499	442		entity for claims administration of a group health benefit plan
500	443		under Subtitle H, Title 8, Insurance Code.
501		-	SECTION 27. Section 2261.254(d), Government Code, is
	444	+	SECTION 25. Section 2261.254(d), Government Code, is
502	445		amended to read as follows:
503	446		(d) The governing body or governing official of a state
504	447		agency, as appropriate, may delegate to the executive director or a
505	448		deputy executive director of the agency the approval and signature
506	449		authority under Subsection (c).
507		-	SECTION 28. Subchapter F, Chapter 2261, Government Code, is
	450	+	SECTION 26. Subchapter F, Chapter 2261, Government Code, is
508	451		amended by adding Sections 2261.258 and 2261.259 to read as
509	452		follows:
510	453		Sec. 2261.258. MONITORING ASSESSMENT BY STATE AUDITOR.
511	454		(a) Before July 1 of each year, the state auditor shall assign one
512	455		of the following ratings to each of the 25 largest state agencies in
513	456		that state fiscal year as determined by the Legislative Budget
514	457		Board:
515	458		(1) additional monitoring warranted;
516	459		(2) no additional monitoring warranted; or
517	460		(3) reduced monitoring warranted.
518	461		(b) In assigning a rating to a state agency as required
519	462		under Subsection (a), the state auditor shall consider the
520	463		following information, as applicable:
521	464		(1) results of an audit of:
522	465		(A) the agency conducted by the state auditor
523	466		under Chapter 321; or
524	467		(B) the agency's contracts and contract
525	468		processes and controls conducted by the agency's internal auditors
526	469		or by the state auditor;
527	470		(2) results of a purchase audit conducted by the
528	471		comptroller under Section 2155.325;
529	472		(3) information reported by the quality assurance team
530	473		established under Section 2054.158 relating to the agency's major
531	474		information resources projects;
532	475		(4) information from the Contract Advisory Team
533	476		established under Subchapter C, Chapter 2262, relating to reviews
534	477		of the agency's contracts and contract solicitation documents;
535	478		(5) information relating to agency findings from a
536	479		review of the agency conducted by:
537	480		(A) the Legislative Budget Board; and
538	481		(B) the Sunset Advisory Commission under Chapter
539	482		325 (Texas Sunset Act);
540	483		(6) the agency's self-reported improvements to the
541	484		agency's contracting processes; and
542	485		(7) any additional internal analysis provided by the
543	486		agency.
544	487		(c) On or before September 1 of each year, the state auditor
545	488		shall submit to the comptroller and the Department of Information
546	489		Resources a report that:
547	490		(1) lists each state agency that was assigned a rating
548	491		under Subsection (a); and
549	492		(2) for a state agency that was assigned a rating under
550	493		Subsection (a)(1) or (3), specifies that additional or reduced
551	494		monitoring, as applicable, is required during one or more of the
552	495		following periods:
553	496		(A) contract solicitation development;
554	497		(B) contract formation and award; or
555	498		(C) contract management and termination.
556	499		(d) In consultation with the Contract Advisory Team
557	500		established under Subchapter C, Chapter 2262, the comptroller by
558	501		rule shall develop guidelines for the additional or reduced
559	502		monitoring of a state agency during the periods described by
560	503		Subsections (c)(2)(A), (B), and (C) for a contract that falls under
561	504		the monetary thresholds for review or monitoring by the Contract
562	505		Advisory Team.
563	506		(e) In consultation with the quality assurance team
564	507		established under Section 2054.158, the Department of Information
565	508		Resources by rule shall develop guidelines for the additional or
566	509		reduced monitoring of a state agency during the periods described
567	510		by Subsections (c)(2)(A), (B), and (C) for a contract that falls
568	511		under the monetary thresholds for review or monitoring by the
569	512		quality assurance team.
570	513		(f) The state auditor may request any information necessary
571	514		from a state agency, the Contract Advisory Team, or the quality
572	515		assurance team to comply with the requirements of this section, and
573	516		the agency or team, as applicable, shall provide the requested
574	517		information.
575	518		(g) The state auditor, comptroller, and Department of
576	519		Information Resources shall share information as necessary to
577	520		fulfill their respective duties under this section.
578	521		(h) The state auditor's duties under this section must be
579	522		included in the audit plan and approved by the legislative audit
580	523		committee under Section 321.013.
581	524		Sec. 2261.259. ELECTRONIC COMPLIANCE SUBMISSIONS. A state
582	525		agency that uses the centralized accounting and payroll system
583	526		authorized under Sections 2101.035 and 2101.036 or an alternative
584	527		computer software system for compliance requirements related to the
585	528		procurement of goods or services may electronically submit to the
586	529		comptroller using that computer software system a written
587	530		justification, verification, notification, or acknowledgement
588	531		required under this chapter or Subchapter B, Chapter 2155.
589		-	SECTION 29. Subchapter B, Chapter 2262, Government Code, is
	532	+	SECTION 27. Subchapter B, Chapter 2262, Government Code, is
590	533		amended by adding Sections 2262.053 and 2262.056 to read as
591	534		follows:
592	535		Sec. 2262.053. CONTRACT FILE CHECKLIST; CERTIFICATION OF
593	536		AGENCY COMPLIANCE. (a) Each state agency shall include in the
594	537		contract file for each of its contracts a checklist to ensure the
595	538		agency's compliance with state laws and rules relating to the
596	539		acquisition of goods and services by the agency.
597	540		(b) The comptroller shall develop and periodically update a
598	541		model contract file checklist and make the checklist available for
599	542		use by state agencies. The comptroller shall periodically update
600	543		the checklist.
601	544		(c) The comptroller may adopt rules necessary to develop or
602	545		update the model contract file checklist.
603	546		(d) The model contract file checklist must address each
604	547		stage of the procurement process and must include, at a minimum, a
605	548		description of:
606	549		(1) the documents that are required to be maintained
607	550		during each stage of the procurement process in accordance with
608	551		applicable state laws and comptroller rules; and
609	552		(2) the procedures and documents that are required to
610	553		be completed during the following stages of the procurement
611	554		process:
612	555		(A) contract solicitation development;
613	556		(B) contract formation and award; and
614	557		(C) contract management.
615	558		(e) A state agency may develop its own contract file
616	559		checklist based on the procurement and contracting needs of that
617	560		agency, provided that the checklist developed by the agency is
618	561		consistent with the comptroller's model contract file checklist and
619	562		meets any requirements established by comptroller rule under
620	563		Subsection (c).
621	564		(f) Before a state agency awards a contract to a vendor for
622	565		the purchase of goods or services, the agency's contract manager or
623	566		procurement director must:
624	567		(1) review the contents of the contract file for the
625	568		contract, including the checklist, to ensure that all documents
626	569		required by state law or applicable agency rules are complete and
627	570		present in the file; and
628	571		(2) certify in a written document to be included in the
629	572		contract file that the review required under Subdivision (1) was
630	573		completed.
631	574		(g) A state agency's contract manager or procurement
632	575		director may delegate to a person in the agency's procurement
633	576		office the certification authority under this section.
634	577		(h) The comptroller by rule shall prescribe the conditions
635	578		under which a state agency's contract manager or procurement
636	579		director:
637	580		(1) must make the certification required by Subsection
638	581		(f); and
639	582		(2) may delegate the certification authority under
640	583		this section.
641	584		Sec. 2262.056. APPROVAL REQUIRED FOR ASSIGNMENT OF SERVICES
642	585		CONTRACTS. (a) In this section:
643	586		(1) "Major information resources project" has the
644	587		meaning assigned by Section 2054.003.
645	588		(2) "Sensitive personal information" has the meaning
646	589		assigned by Section 521.002, Business & Commerce Code.
647	590		(b) A vendor awarded a services contract by a state agency
648	591		may not assign the vendor's rights under the contract to a third
649	592		party unless the assignment is approved by the state agency.
650	593		(c) At least 14 days before a state agency rejects or
651	594		approves a vendor's proposed assignment under Subsection (b), the
652	595		state agency shall notify the Legislative Budget Board of the
653	596		proposed assignment if the contract subject to the assignment:
654	597		(1) is for a major information resources project; or
655	598		(2) involves storing, receiving, processing,
656	599		transmitting, disposing of, or accessing sensitive personal
657	600		information in a foreign country.
658		-	SECTION 30. The following provisions of the Government Code
	601	+	SECTION 28. The following provisions of the Government Code
659	602		are repealed:
660		-	(1) ~~Section~~ 825.103(g);
	603	+	(1) Sections 825.103(d) and (g);
661	604		(2) Section 2054.1181(f);
662	605		(3) Section 2054.1184;
663	606		(4) Sections 2054.159(c) and (d);
664	607		(5) Section 2054.304(c);
665		-	(6) Section 2254.031(c); and
666		-	(7) Section 2254.033(b).
667		-	SECTION 31. As soon as practicable after the effective date
	608	+	(6) Section 2254.030;
	609	+	(7) Section 2254.031(c); and
	610	+	(8) Section 2254.033(b).
	611	+	SECTION 29. As soon as practicable after the effective date
668	612		of this Act, the comptroller of public accounts, the Department of
669	613		Information Resources, and each affected state agency as necessary,
670	614		shall adopt the rules, processes, and procedures and take the
671	615		actions necessary to implement the changes in law made by this Act.
672		-	SECTION 32. (a) Except as provided by Subsections (b) and
	616	+	SECTION 30. (a) Except as provided by Subsections (b) and
673	617		(c) of this section, this Act applies only in relation to a
674	618		contract:
675	619		(1) for which a state agency first advertises or
676	620		otherwise solicits bids, proposals, offers, or qualifications on or
677	621		after the effective date of this Act;
678	622		(2) that is extended or modified on or after the
679	623		effective date of this Act; or
680	624		(3) for which a change order is submitted on or after
681	625		the effective date of this Act.
682	626		(b) Section 2262.056, Government Code, as added by this Act,
683	627		applies only to a contract entered into or renewed on or after the
684	628		effective date of this Act.
685	629		(c) The changes in law made by this Act that apply to a major
686	630		consulting services contract apply only to a major consulting
687	631		services contract entered into or amended, modified, renewed, or
688	632		extended on or after the effective date of this Act. A major
689	633		consulting services contract entered into or amended, modified,
690	634		renewed, or extended before the effective date of this Act is
691	635		governed by the law in effect on the date the contract was entered
692	636		into or amended, modified, renewed, or extended, and the former law
693	637		is continued in effect for that purpose.
694		-	SECTION 33. Notwithstanding Section 2261.258, Government
	638	+	SECTION 31. Notwithstanding Section 2261.258, Government
695	639		Code, as added by this Act, the first report required under that
696	640		section is due on or before September 1, 2020.
697		-	SECTION 34. This Act takes effect September 1, 2019.
698		-	______________________________ ______________________________
699		-	President of the Senate Speaker of the House
700		-	I hereby certify that S.B. No. 65 passed the Senate on
701		-	March 20, 2019, by the following vote: Yeas 31, Nays 0; and that
702		-	the Senate concurred in House amendments on May 24, 2019, by the
703		-	following vote: Yeas 31, Nays 0.
704		-	______________________________
705		-	Secretary of the Senate
706		-	I hereby certify that S.B. No. 65 passed the House, with
707		-	amendments, on May 22, 2019, by the following vote: Yeas 143,
708		-	Nays 0, two present not voting.
709		-	______________________________
710		-	Chief Clerk of the House
711		-	Approved:
712		-	______________________________
713		-	Date
714		-	______________________________
715		-	Governor
	641	+	SECTION 32. This Act takes effect September 1, 2019.