HBA-DMH C.S.S.B. 510 77(R) BILL ANALYSIS Office of House Bill AnalysisC.S.S.B. 510 By: Armbrister Urban Affairs 4/10/2001 Committee Report (Substituted) BACKGROUND AND PURPOSE Under current law, no authority exists for municipalities, counties, or river authorities to utilize design-build procedures to provide flexibility in constructing needed facilities and possibly save time in design and construction. C.S.S.B. 510 authorizes governmental entities to use design-build procedures and other alternative project delivery and contracting methods. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS C.S.S.B. 510 amends the Local Government Code to authorize a governmental entity to use any of the following methods that provides the best value for the governmental entity when entering into a contract for the construction of a facility: _competitive bidding; _competitive sealed proposals for construction services; _a design-build contract; _a contract to construct, rehabilitate, alter, or repair facilities that involves using a construction manager; or _a job order contract for the minor repair, rehabilitation, or alteration of a facility. In determining to whom to award a contract, the bill authorizes the governmental entity to consider the purchase price, the reputation of the vendor and of the vendor's goods or services, the quality of the vendor's goods or services, the extent to which the goods or services meet the governmental entity's needs, the vendor's past relationship with the governmental entity, the impact on the ability of the governmental entity to comply with rules relating to historically underutilized businesses, the total long-term cost to the governmental entity to acquire the vendor's goods or services, and any other relevant factor that a private business entity would consider in selecting a vendor (Sec. 271.113). The bill provides that the governing body of a governmental entity that is considering a construction contract using one of the specified procurement methods other than competitive bidding must, before advertising, determine which method provides the best value for the governmental entity. The bill sets forth criteria and procedures for evaluating and selecting a contractor for construction services (Secs. 271.114-271.116). The bill authorizes a governmental entity to use the construction manager-agent method, the construction manager-at-risk method, or the design-build method for the construction, rehabilitation, alteration, or repair of a facility. In using any of the methods and in entering into a contract for any of the services, the bill requires the contracting governmental entity to follow prescribed procedures (Secs. 271.117-271.119). The bill authorizes a governmental entity to award job order contracts for the minor construction, repair, rehabilitation, or alteration of a facility if the work is of a recurring nature but the delivery times are indefinite and indefinite quantities and orders are awarded substantially on the basis of predescribed and prepriced tasks. The bill sets forth procedures for executing a job order contract (Sec. 271.120). The bill prohibits a governmental entity, while engaged in procuring goods or services, awarding a contract, or overseeing procurement or construction for a public work or public improvement, from considering whether a vendor is a member or has another relationship with any organization and requires the governmental entity to ensure that its bid specifications and any subsequent contract or other agreement do not deny or diminish the right of a person to work because of the person's membership or other relationship status with respect to any organization (Sec. 271.121). The bill provides that any provision in the charter of a home-rule municipality or any regulation of a county or river authority that requires the use of competitive bidding or competitive sealed proposals or that prescribes procurement procedures and that is in conflict with provisions of the bill controls unless the governing body of the governmental entity elects to have the provisions for alternative project delivery methods supersede the charter or regulation. The purchasing requirements established in provisions relating to governmental entity preferences for recycled products apply to purchases by a governmental entity made through an alternative project delivery method. To the extent of any conflict, the provisions for alternative project delivery methods prevail over any other law relating to the purchasing of goods and services except a law relating to contracting with historically underutilized businesses. The bill sets forth notice requirements for bids and proposals (Sec. 271.112). The provisions relating to the purchasing and contracting authority of municipalities do not apply to a municipal contract for an expenditure of $15,000 or more if the governing body of the municipality determines that an alternative project delivery method provides a better value for the municipality (Sec. 252.002). The bill amends the Government Code to provide that the Professional Services Procurement Act applies to a local government corporation or another entity created by or acting on behalf of a political subdivision (Sec. 2254.002). The bill amends the Education Code to require a school district or the governing body of an institution of higher education, when using the design-build method for a facility to designate an engineer or architect independent of the design-build firm to act as its representative for the duration of the work on the facility (Secs. 44.036 and 51.780). EFFECTIVE DATE September 1, 2001. COMPARISON OF ORIGINAL TO SUBSTITUTE C.S.S.B. 510 differs from the original bill by including a river authority in the definition of "governmental entity" and setting forth provisions regarding the supersession of certain regulations or provisions of a charter of a river authority (Secs. 271.111 and 271.112). The substitute also modifies contract notice requirements (Sec. 271.112). The substitute includes among the factors that a governmental entity may consider when awarding a contract for the construction of a facility any other relevant factor that a private business entity would consider in selecting a vendor (Sec 271.113). The substitute modifies design-build contract requirements for school districts and institutions of higher education in the Education Code (Secs. 44.036 and 51.780).