Texas 2021 - 87th Regular

Texas Senate Bill SB2002 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	87R4716 RDS-F
2	2	By: Miles S.B. No. 2002
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the state historically underutilized business program;
8	8	creating a criminal offense.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 2161.001, Government Code, is amended by
11	11	adding Subdivision (5) to read as follows:
12	12	(5) "Commercially useful function" means
13	13	responsibility for the execution of a distinct element of the work
14	14	of a contract and performance, management, and supervision of the
15	15	work involved, including:
16	16	(A) negotiation of the terms of a contract or
17	17	subcontract;
18	18	(B) assumption of financial risk commensurate
19	19	with a contract or subcontract;
20	20	(C) acquisition of appropriate lines of credit or
21	21	loans; or
22	22	(D) fulfillment of the responsibilities of a
23	23	joint venture partner under a joint venture agreement.
24	24	SECTION 2. Section 2161.0015, Government Code, is amended
25	25	to read as follows:
26	26	Sec. 2161.0015. DETERMINING SIZE STANDARDS FOR
27	27	HISTORICALLY UNDERUTILIZED BUSINESSES. To [The comptroller may
28	28	establish size standards that a business may not exceed if it is to]
29	29	be considered a historically underutilized business under this
30	30	chapter:
31	31	(1) the business owner may not have an individual
32	32	personal net worth of more than $1.32 million; and
33	33	(2) the business must:
34	34	(A) meet the Small Business Administration's
35	35	size standards for a small business for purposes of federal
36	36	government procurement under 13 C.F.R. Section 121.401, et seq.;
37	37	and
38	38	(B) have an annual gross income of not more than
39	39	$23.98 million. [In determining the size standards, the comptroller
40	40	shall determine the size at which a business should be considered
41	41	sufficiently large that the business probably does not
42	42	significantly suffer from the effects of past discriminatory
43	43	practices.]
44	44	SECTION 3. Section 2161.002(c), Government Code, is amended
45	45	to read as follows:
46	46	(c) In adopting rules to administer this chapter, the
47	47	comptroller shall adopt rules that are based on the results of the
48	48	"Texas Department of Transportation Disparity Study 2019" prepared
49	49	by Colette Holt & Associates ["State of Texas Disparity Study, A
50	50	Report to the Texas Legislature as Mandated by H.B. 2626, 73rd
51	51	Legislature, December 1994" (prepared by National Economic
52	52	Research Associates, Inc.)]. The comptroller shall revise the
53	53	rules in response to the findings of any updates of the study that
54	54	are prepared on behalf of the state.
55	55	SECTION 4. Section 2161.004(c), Government Code, is amended
56	56	to read as follows:
57	57	(c) Section 2161.003 and Subsections (a) and (b) of this
58	58	section [do not] apply to a project or contract subject to Section
59	59	201.702, Transportation Code.
60	60	SECTION 5. Section 2161.061, Government Code, is amended by
61	61	amending Subsections (a) and (e) and adding Subsections (a-1),
62	62	(a-2), and (a-3) to read as follows:
63	63	(a) The comptroller shall certify and recertify
64	64	historically underutilized businesses.
65	65	(a-1) A certification or recertification under this section
66	66	expires on the first anniversary of the date the certification or
67	67	recertification was issued.
68	68	(a-2) The comptroller may not initially certify a business
69	69	as a historically underutilized business unless each owner of the
70	70	business completes at least 32 hours of training provided by the
71	71	comptroller or a local government or nonprofit organization
72	72	approved by the comptroller to provide the training. The training
73	73	must include information regarding:
74	74	(1) the requirements of this chapter and rules adopted
75	75	under this chapter; and
76	76	(2) the programs available under 49 C.F.R. Part 26 and
77	77	the requirements for participation in those programs.
78	78	(a-3) The comptroller may not recertify a business as a
79	79	historically underutilized business unless each owner of the
80	80	business completes at least eight hours of continuing training
81	81	provided by the comptroller or a local government or nonprofit
82	82	organization approved by the comptroller to provide the continuing
83	83	training.
84	84	(e) A local government or a nonprofit organization that
85	85	certifies historically underutilized businesses under Subsection
86	86	(c) or that conducts a certification program described by and
87	87	approved under Subsection (b) shall make available to the public an
88	88	online searchable database containing information about
89	89	historically underutilized businesses, minority business
90	90	enterprises, women's business enterprises, and disadvantaged
91	91	business enterprises certified by the local government or nonprofit
92	92	organization, including:
93	93	(1) the name of the business;
94	94	(2) the contact person or owner of the business;
95	95	(3) the address and telephone number of the business;
96	96	(4) the type or category of business, including
97	97	relevant capabilities of the business and the North American
98	98	Industry Classification System codes for the business; [and]
99	99	(5) the expiration date of the business's
100	100	certification; and
101	101	(6) the date of completion of training required under
102	102	this section.
103	103	SECTION 6. Sections 2161.062(b), (d), and (e), Government
104	104	Code, are amended to read as follows:
105	105	(b) The comptroller shall offer historically underutilized
106	106	businesses assistance, [and] training, and continuing training
107	107	regarding state procurement procedures.
108	108	(d) The comptroller shall send each historically
109	109	underutilized business [businesses] an orientation package on
110	110	certification or recertification. The package shall include:
111	111	(1) a certificate issued in the historically
112	112	underutilized business's name;
113	113	(2) a description of the significance and value of
114	114	certification;
115	115	(3) a list of state purchasing personnel;
116	116	(4) information regarding electronic commerce
117	117	opportunities;
118	118	(5) information regarding the Texas Marketplace
119	119	website; [and]
120	120	(6) additional information about the state
121	121	procurement process; and
122	122	(7) the business's current training and continuing
123	123	training status.
124	124	(e) A state agency with a biennial budget that exceeds $10
125	125	million shall designate a staff member to serve as the historically
126	126	underutilized businesses coordinator for the agency during the
127	127	fiscal year. The procurement director may serve as the coordinator.
128	128	In agencies that employ a historically underutilized businesses
129	129	coordinator, the position of coordinator, within the agency's
130	130	structure, must be at least equal to the position of procurement
131	131	director. In addition to any other responsibilities, the
132	132	coordinator shall:
133	133	(1) coordinate training programs for the recruitment,
134	134	training, and retention of historically underutilized businesses;
135	135	(2) report required information to the comptroller
136	136	annually; and
137	137	(3) match historically underutilized businesses with
138	138	key staff within the agency.
139	139	SECTION 7. Section 2161.063(a), Government Code, is amended
140	140	to read as follows:
141	141	(a) The comptroller shall encourage state agencies to use
142	142	historically underutilized businesses by:
143	143	(1) working with state agencies to establish a
144	144	statewide policy for increasing the use of historically
145	145	underutilized businesses;
146	146	(2) assisting state agencies in seeking historically
147	147	underutilized businesses capable of supplying required goods or
148	148	services;
149	149	(3) assisting state agencies in identifying and
150	150	advising historically underutilized businesses on the types of
151	151	goods and services the agencies need; [and]
152	152	(4) assisting state agencies in increasing the amount
153	153	of business placed with historically underutilized businesses; and
154	154	(5) assisting state agencies in identifying
155	155	historically underutilized businesses that can perform
156	156	commercially useful functions for agencies.
157	157	SECTION 8. Section 2161.064, Government Code, is amended by
158	158	adding Subsection (f) to read as follows:
159	159	(f) The comptroller shall verify that each historically
160	160	underutilized business listed in the directory is in full
161	161	compliance with the training requirements under Section 2161.061.
162	162	SECTION 9. Section 2161.065, Government Code, is amended by
163	163	amending Subsection (a) and adding Subsection (c) to read as
164	164	follows:
165	165	(a) The comptroller shall design and oversee the
166	166	implementation by state agencies of a mentor-protege program to
167	167	foster long-term relationships between prime contractors and
168	168	historically underutilized businesses and to increase the ability
169	169	of historically underutilized businesses to contract with the state
170	170	or to receive subcontracts under a state contract. Each state
171	171	agency with a biennial appropriation that exceeds $10 million shall
172	172	implement and require participation in the program designed by the
173	173	comptroller.
174	174	(c) The mentor-protege program under this section must be
175	175	consistent with the program established under 49 C.F.R. Section
176	176	26.35.
177	177	SECTION 10. Section 2161.066(d), Government Code, is
178	178	amended to read as follows:
179	179	(d) Each state agency that has a historically underutilized
180	180	businesses coordinator shall:
181	181	(1) design its own program and model the program to the
182	182	extent appropriate on the program developed by the comptroller
183	183	under this section; [and]
184	184	(2) sponsor presentations by historically
185	185	underutilized businesses at the agency; and
186	186	(3) provide a method for a historically underutilized
187	187	business to provide documentation through a state-approved source
188	188	that the business is able to perform a commercially useful function
189	189	in the industry for which the business is certified as a
190	190	historically underutilized business, according to the North
191	191	American Industry Classification System.
192	192	SECTION 11. Section 2161.121(a), Government Code, is
193	193	amended to read as follows:
194	194	(a) The comptroller shall prepare a consolidated report
195	195	that:
196	196	(1) includes the number and dollar amount of contracts
197	197	awarded and paid to historically underutilized businesses
198	198	certified by the comptroller;
199	199	(2) analyzes the relative level of opportunity for
200	200	historically underutilized businesses for various categories of
201	201	acquired goods and services; [and]
202	202	(3) tracks, by vendor identification number and, to
203	203	the extent allowed by federal law, by social security number, the
204	204	graduation rates for historically underutilized businesses that
205	205	grew to exceed the size standards determined by the comptroller;
206	206	and
207	207	(4) includes assurances by state agencies that the
208	208	number and the dollar amounts of contracts awarded to historically
209	209	underutilized businesses are properly calculated according to the
210	210	level of participation each historically underutilized business
211	211	performs for purposes of determining the amount that could be
212	212	counted toward a disadvantaged business enterprise participation
213	213	goal under 49 C.F.R. Section 26.55.
214	214	SECTION 12. Sections 2161.122(b), (c), and (d), Government
215	215	Code, are amended to read as follows:
216	216	(b) A contractor or supplier awarded a contract by a state
217	217	agency shall report to the agency the identity of each historically
218	218	underutilized business to whom the contractor or supplier awarded a
219	219	subcontract for the purchase of goods or services and certify that
220	220	the historically underutilized business can perform a commercially
221	221	useful function.
222	222	(c) Each state agency shall report to the comptroller in
223	223	accordance with Section 2161.125 the following information with
224	224	regard to the expenditure of both treasury and nontreasury funds:
225	225	(1) the total dollar amount of purchases and payments
226	226	made under contracts awarded to historically underutilized
227	227	businesses that could be counted toward a disadvantaged business
228	228	enterprise participation goal under 49 C.F.R. Section 26.55;
229	229	(2) the number of businesses participating in any
230	230	issuance of state bonds by the agency;
231	231	(3) the number of contracts awarded to businesses with
232	232	regard to the agency's acquisition, construction, or equipping of a
233	233	facility or implementation of a program; and
234	234	(4) the number of bids, proposals, or other applicable
235	235	expressions of interest made by historically underutilized
236	236	businesses with regard to the agency's acquisition, construction,
237	237	or equipping of a facility or implementation of a program.
238	238	(d) A state agency participating in a group purchasing
239	239	program shall send to the comptroller in the agency's report under
240	240	Section 2161.121 a separate list of purchases from historically
241	241	underutilized businesses that are made through the group purchasing
242	242	program, including the dollar amount of each purchase allocated to
243	243	the reporting agency that could be counted toward a disadvantaged
244	244	business enterprise participation goal under 49 C.F.R. Section
245	245	26.55.
246	246	SECTION 13. Sections 2161.123(a) and (d), Government Code,
247	247	are amended to read as follows:
248	248	(a) Each state agency, including the comptroller, that is
249	249	required to have a strategic plan under Chapter 2056 shall include
250	250	in its strategic plan a written plan for increasing the agency's use
251	251	of historically underutilized businesses in purchasing and public
252	252	works contracting and for monitoring the agency's use of
253	253	historically underutilized businesses based on amounts that could
254	254	be counted toward a disadvantaged business enterprise
255	255	participation goal under 49 C.F.R. Section 26.55. The governing
256	256	board of each university system or institution of higher education
257	257	not included in a university system, other than a public junior
258	258	college, shall prepare a written plan for increasing the use of
259	259	historically underutilized businesses in purchasing and public
260	260	works contracting by the system or institution.
261	261	(d) The comptroller and the state auditor shall cooperate to
262	262	develop procedures providing for random periodic monitoring of
263	263	state agency compliance with this section. The state auditor shall
264	264	report to the comptroller a state agency that is not complying with
265	265	this section. In determining whether a state agency is making a
266	266	good faith effort to comply, the state auditor shall consider
267	267	whether the agency:
268	268	(1) has adopted rules under Section 2161.003;
269	269	(2) has used the comptroller's directory under Section
270	270	2161.064 and other resources to identify certified and qualified
271	271	historically underutilized businesses that are able and available
272	272	to contract with the agency;
273	273	(3) made good faith, timely efforts to contact
274	274	identified historically underutilized businesses regarding
275	275	contracting opportunities;
276	276	(4) conducted its procurement program in accordance
277	277	with the good faith effort methodology set out in comptroller
278	278	rules; and
279	279	(5) established goals for contracting with
280	280	historically underutilized businesses in each procurement category
281	281	based on:
282	282	(A) scheduled fiscal year expenditures; and
283	283	(B) the availability of historically
284	284	underutilized businesses in each category as determined by rules
285	285	adopted under Section 2161.002.
286	286	SECTION 14. Section 2161.125, Government Code, is amended
287	287	to read as follows:
288	288	Sec. 2161.125. CATEGORIZATION OF HISTORICALLY
289	289	UNDERUTILIZED BUSINESSES; TRAINING INFORMATION. (a) The
290	290	comptroller, in cooperation with each state agency reporting under
291	291	this subchapter, shall categorize each historically underutilized
292	292	business included in a report under this subchapter by sex, race,
293	293	and ethnicity and by whether the business qualifies as a
294	294	historically underutilized business because it is owned or owned,
295	295	operated, and controlled, as applicable, wholly or partly by one or
296	296	more veterans as defined by 38 U.S.C. Section 101(2) who have
297	297	suffered at least a 20 percent service-connected disability as
298	298	defined by 38 U.S.C. Section 101(16).
299	299	(b) The report under Subsection (a) must also state whether
300	300	the historically underutilized business owners have completed
301	301	training and continuing training required by Section 2161.061 and
302	302	whether the business can perform a commercially useful function.
303	303	SECTION 15. Section 2161.181, Government Code, is amended
304	304	to read as follows:
305	305	Sec. 2161.181. GOALS FOR PURCHASES OF GOODS AND SERVICES. A
306	306	state agency, including the comptroller, shall make a good faith
307	307	effort to increase the contract awards for the purchase of goods or
308	308	services that the agency expects to make during a fiscal year to
309	309	historically underutilized businesses based on rules adopted by the
310	310	comptroller to implement the disparity study described by Section
311	311	2161.002(c). The agency's efforts and achievement of its goals
312	312	under this section must be measured based on amounts that could be
313	313	counted toward a disadvantaged business enterprise participation
314	314	goal under 49 C.F.R. Section 26.55.
315	315	SECTION 16. Section 2161.182(a), Government Code, is
316	316	amended to read as follows:
317	317	(a) A state agency that contracts for a construction
318	318	project, including a project under Section 2166.003, shall make a
319	319	good faith effort to increase the construction contract awards that
320	320	the agency expects to make during a fiscal year to historically
321	321	underutilized businesses based on rules adopted by the comptroller
322	322	to implement the disparity study described by Section 2161.002(c).
323	323	The agency's efforts and achievement of its goals under this
324	324	subsection must be measured based on amounts that could be counted
325	325	toward a disadvantaged business enterprise participation goal
326	326	under 49 C.F.R. Section 26.55.
327	327	SECTION 17. Section 2161.231, Government Code, is amended
328	328	by adding Subsection (a-1) to read as follows:
329	329	(a-1) A person commits an offense if the person
330	330	intentionally makes a false report under this subtitle regarding an
331	331	award of a purchasing contract or public works contract to a
332	332	historically underutilized business.
333	333	SECTION 18. Section 2161.252, Government Code, is amended
334	334	by adding Subsection (c) to read as follows:
335	335	(c) A state agency may not approve a historically
336	336	underutilized business subcontracting plan or award a contract to
337	337	which the plan relates unless the plan has been approved by the
338	338	agency's good faith effort review committee established under
339	339	Section 2161.2521.
340	340	SECTION 19. Subchapter F, Chapter 2161, Government Code, is
341	341	amended by adding Section 2161.2521 to read as follows:
342	342	Sec. 2161.2521. GOOD FAITH EFFORT REVIEW COMMITTEE. (a) A
343	343	state agency that determines that there is a probability for
344	344	subcontracting opportunities under Section 2161.252 shall
345	345	establish a good faith effort review committee for the purpose of
346	346	reviewing any subcontracting plans.
347	347	(b) The committee shall consist of five members, including:
348	348	(1) three members from the state historically
349	349	underutilized business community;
350	350	(2) one member from the state agency; and
351	351	(3) one member from the prime contracting community.
352	352	SECTION 20. Sections 2161.253(b) and (c), Government Code,
353	353	are amended to read as follows:
354	354	(b) To the extent that subcontracts are not contracted for
355	355	as originally submitted in the historically underutilized business
356	356	subcontracting plan, the contractor shall report to the state
357	357	agency and the agency's good faith effort review committee all the
358	358	circumstances that explain that fact and describe the good faith
359	359	efforts made to find and subcontract with another historically
360	360	underutilized business.
361	361	(c) The state agency and the agency's good faith effort
362	362	review committee shall audit the contractor's compliance with the
363	363	historically underutilized business subcontracting plan. In
364	364	determining whether the contractor made the required good faith
365	365	effort, the agency may not consider the success or failure of the
366	366	contractor to subcontract with historically underutilized
367	367	businesses in any specific quantity. The agency's determination is
368	368	restricted to considering factors indicating good faith.
369	369	SECTION 21. Section 2161.065(b), Government Code, is
370	370	repealed.
371	371	SECTION 22. The changes in law made by this Act apply only
372	372	to a contract for which the request for bids or proposals or other
373	373	applicable expressions of interest, if applicable, is made public
374	374	on or after the effective date of this Act.
375	375	SECTION 23. This Act takes effect September 1, 2021.