87R3371 MWC-D
By: Reynolds H.B. No. 923
A BILL TO BE ENTITLED
AN ACT
relating to historically underutilized businesses and to goods and
services purchased by governmental entities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2155.074(b), Government Code, is amended
to read as follows:
(b) In determining the best value for the state, the
purchase price and whether the goods or services meet
specifications are the most important considerations. However, the
comptroller or other state agency may, subject to Subsection (c)
and Section 2155.075, consider other relevant factors, including:
(1) installation costs;
(2) life cycle costs;
(3) the quality and reliability of the goods and
services;
(4) the delivery terms;
(5) indicators of probable vendor performance under
the contract such as past vendor performance, the vendor's
financial resources and ability to perform, the vendor's experience
or demonstrated capability and responsibility, and the vendor's
ability to provide reliable maintenance agreements and support;
(6) the cost of any employee training associated with
a purchase;
(7) the effect of a purchase on agency productivity;
(8) the vendor's anticipated economic impact to the
state or a subdivision of the state, including potential tax
revenue and employment; [and]
(9) whether the vendor is a historically underutilized
business as defined by Section 2161.001; and
(10) other factors relevant to determining the best
value for the state in the context of a particular purchase.
SECTION 2. Sections 2155.444(a), (b), (c), and (e),
Government Code, are amended to read as follows:
(a) The comptroller and all state agencies making purchases
of goods, including agricultural products, shall give preference to
those produced or grown in this state or offered by Texas bidders as
follows:
(1) goods produced or offered by a Texas bidder that is
a historically underutilized business [owned by a service-disabled
veteran who is a Texas resident] shall be given a first preference
and goods produced in this state or offered by other Texas bidders
shall be given second preference, if the cost to the state and
quality are equal; and
(2) agricultural products grown in this state shall be
given first preference and agricultural products offered by Texas
bidders shall be given second preference, if the cost to the state
and quality are equal.
(b) If goods, including agricultural products, produced or
grown in this state or offered by Texas bidders exceed 105 percent
of the cost of other goods or are not equal in [cost and] quality to
other products, then goods, including agricultural products,
produced or grown in other states of the United States shall be
given preference over foreign products if the cost to the state and
quality are equal.
(c) In this section:
(1) "Agricultural products" includes textiles and
other similar products.
(2) "Historically underutilized business" has the
meaning assigned by Section 2161.001.
[(1-a) "Service-disabled veteran" means a person who
is a veteran as defined by 38 U.S.C. Section 101(2) and who has a
service-connected disability as defined by 38 U.S.C. Section
101(16).]
(3) [(2)] "Texas bidder" means a business:
(A) incorporated in this state;
(B) that has its principal place of business in
this state; or
(C) that has an established physical presence in
this state.
(e) The comptroller and all state agencies procuring
services shall give first preference to services offered by a Texas
bidder that is a historically underutilized business [owned by a
service-disabled veteran who is a Texas resident] and shall give
second preference to services offered by other Texas bidders if:
(1) the services meet state requirements regarding the
service to be performed and expected quality; and
(2) the cost of the service does not exceed the cost of
other similar services of similar expected quality that are offered
by a bidder that is not entitled to a preference under this
subsection.
SECTION 3. Section 2161.001, Government Code, is amended by
amending Subdivision (3) and adding Subdivision (5) to read as
follows:
(3) "Economically disadvantaged person" means a
person who:
(A) is economically disadvantaged because of the
person's identification as a member of a certain group, including:
(i) Black Americans;
(ii) Hispanic Americans;
(iii) women;
(iv) Asian Pacific Americans;
(v) Native Americans; and
(vi) veterans as defined by 38 U.S.C.
Section 101(2) who have [suffered at least] a [20 percent]
service-connected disability as defined by 38 U.S.C. Section
101(16); and
(B) has suffered the effects of discriminatory
practices or other similar insidious circumstances over which the
person has no control.
(5) "Professional services" has the meaning assigned
by Section 2254.002.
SECTION 4. Section 2161.064, Government Code, is amended by
adding Subsection (f) to read as follows:
(f) A state agency may use the directory to create a mailing
list for soliciting bids from historically underutilized
businesses. A state agency that determines the size of the
acquisition justifies rotation may rotate the businesses included
on the mailing list by using different portions of the directory for
separate acquisitions of goods or services. A state agency
rotating the businesses included on a solicitation mailing list
shall solicit bids from:
(1) a bidder who was previously awarded the bid for the
goods or services;
(2) each business added to the directory since the
last solicitation; and
(3) each business included in the portion of the
directory selected for the solicitation mailing list.
SECTION 5. Subchapter B, Chapter 2161, Government Code, is
amended by adding Section 2161.067 to read as follows:
Sec. 2161.067. JOINT VENTURES. (a) In this section:
(1) "Eligible purchase" means a purchase of goods or
services that:
(A) a state agency determines is eligible for a
joint venture based on work and market availability; and
(B) exceeds the minimum dollar value provided by
comptroller rule.
(2) "Joint venture" means an association of two or
more individuals or businesses, at least one of which is a
historically underutilized business, that is:
(A) established to engage in a single business
activity;
(B) certified as a joint venture by the
comptroller; and
(C) limited in scope and duration.
(b) Each state agency shall determine whether a purchase of
goods or services is an eligible purchase for which the agency is
required to make a good faith effort to award the contract to a
joint venture. The agency may not accept a contract bid submitted
by any bidder other than a joint venture unless the agency
determines, based on the relevant facts, documents, and
circumstances, that the agency made a good faith effort to award the
contract to a joint venture.
(c) A contract for a joint venture must be in writing and:
(1) be based on shared economic interests in the
venture, including proportionate control over management, interest
in capital acquired by the joint venture, and interest in earnings;
(2) be completed by all parties to the joint venture;
(3) be executed before a notary public;
(4) clearly delineate the rights and responsibilities
of each party;
(5) comply with any requirements of the comptroller as
provided in bid documents or otherwise; and
(6) provide that the joint venture continue for at
least the duration of the eligible purchase.
(d) The comptroller using available resources shall select
for review a random sampling of state agency joint venture
determinations made under Subsection (b).
(e) A state agency selected by the comptroller under
Subsection (d), the joint venture, and each party to the joint
venture shall provide the comptroller access to all records
pertaining to joint venture agreements before and after the
agency's award of a contract to the joint venture to reasonably
assess compliance with this section.
(f) A party to a joint venture who fails to comply with this
section, and whose failure to comply continues for at least 30 days
after the date the party receives written notice of the
noncompliance from the comptroller, is subject to any or all of the
following penalties:
(1) withholding of 10 percent of all future payments
for the eligible purchase until the comptroller determines the
party is in compliance with this section;
(2) withholding of all future payments under the
eligible purchase until the comptroller determines the party is in
compliance with this section;
(3) cancellation of the eligible purchase; and
(4) ineligibility for future contracts or
subcontracts with this state for one to five years after the date on
which the penalty is imposed.
SECTION 6. Section 2161.252, Government Code, is amended by
adding Subsection (c) to read as follows:
(c) A historically underutilized business subcontracting
plan must require the contractor to accept bids, proposals, offers,
or other applicable expressions from historically underutilized
businesses for not less than 10 working days after the date the
contractor notifies the businesses of the subcontracting
opportunity. This subsection does not apply to a professional
services contract.
SECTION 7. Section 2254.002(2), Government Code, is amended
to read as follows:
(2) "Professional services" means services:
(A) within the scope of the practice, as defined
by state law, of:
(i) accounting;
(ii) architecture;
(iii) landscape architecture;
(iv) land surveying;
(v) medicine;
(vi) optometry;
(vii) professional engineering;
(viii) real estate appraising; or
(ix) professional nursing;
(B) provided in connection with the professional
employment or practice of a person who is licensed or registered as:
(i) a certified public accountant;
(ii) an architect;
(iii) a landscape architect;
(iv) a land surveyor;
(v) a physician, including a surgeon;
(vi) an optometrist;
(vii) a professional engineer;
(viii) a state certified or state licensed
real estate appraiser; [or]
(ix) a registered nurse; or
(x) an attorney; or
(C) provided by a person lawfully engaged in
interior design, regardless of whether the person is registered as
an interior designer under Chapter 1053, Occupations Code.
SECTION 8. Section 2254.154, Government Code, is repealed.
SECTION 9. (a) Not later than December 1, 2021, the
comptroller of public accounts shall adopt the rules required to
implement the changes in law made by this Act.
(b) Chapters 2155 and 2161, Government Code, as amended by
this Act, apply only to a purchase of goods or services or a
contract entered into on or after January 1, 2022.
SECTION 10. This Act takes effect September 1, 2021.