CHAPTER 2161. HISTORICALLY UNDERUTILIZED BUSINESSES

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GOVERNMENT CODE

TITLE 10. GENERAL GOVERNMENT

SUBTITLE D. STATE PURCHASING AND GENERAL SERVICES

CHAPTER 2161. HISTORICALLY UNDERUTILIZED BUSINESSES

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 2161.001. DEFINITIONS. In this chapter:

(1) "Goods" means supplies, materials, or equipment.

(2) "Historically underutilized business" means an entity with

its principal place of business in this state that is:

(A) a corporation formed for the purpose of making a profit in

which 51 percent or more of all classes of the shares of stock or

other equitable securities are owned by one or more economically

disadvantaged persons who have a proportionate interest and

actively participate in the corporation's control, operation, and

management;

(B) a sole proprietorship created for the purpose of making a

profit that is completely owned, operated, and controlled by an

economically disadvantaged person;

which 51 percent or more of the assets and interest in the

partnership are owned by one or more economically disadvantaged

persons who have a proportionate interest and actively

participate in the partnership's control, operation, and

management;

(D) a joint venture in which each entity in the venture is a

historically underutilized business, as determined under another

paragraph of this subdivision; or

(E) a supplier contract between a historically underutilized

business as determined under another paragraph of this

subdivision and a prime contractor under which the historically

underutilized business is directly involved in the manufacture or

distribution of the goods or otherwise warehouses and ships the

goods.

(3) "Economically disadvantaged person" means a person who is

economically disadvantaged because of the person's identification

as a member of a certain group, including Black Americans,

Hispanic Americans, women, Asian Pacific Americans, and Native

Americans, and who has suffered the effects of discriminatory

practices or other similar insidious circumstances over which the

person has no control.

(4) "Contract" includes an arrangement under which a state

agency receives professional or investment brokerage services.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 1.21, eff.

Sept. 1, 1999; Acts 2003, 78th Leg., ch. 1261, Sec. 1, eff. Sept.

1, 2003.

For expiration of this section, see Section 2151.0041.

Sec. 2161.0011. TRANSFER OF DUTIES; REFERENCE. (a) The powers

and duties of the commission under this chapter are transferred

to the comptroller.

(b) In this chapter, a reference to the commission means the

comptroller.

Added by Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.21, eff. September 1, 2007.

Sec. 2161.0012. AUTHORITY TO ADOPT RULES. (a) The comptroller

may adopt rules to efficiently and effectively administer this

chapter. Before adopting a rule under this section, the

comptroller must conduct a public hearing regarding the proposed

rule regardless of whether the requirements of Section

2001.029(b) are met.

(b) The comptroller shall follow the procedures prescribed by

Subchapter B, Chapter 2001, when adopting a new rule or a change

to an existing rule that relates to historically underutilized

businesses.

Added by Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.21, eff. September 1, 2007.

Sec. 2161.0015. DETERMINING SIZE STANDARDS FOR HISTORICALLY

UNDERUTILIZED BUSINESSES. The commission may establish size

standards that a business may not exceed if it is to be

considered a historically underutilized business under this

chapter. In determining the size standards, the commission shall

determine the size at which a business should be considered

sufficiently large that the business probably does not

significantly suffer from the effects of past discriminatory

practices.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.02, eff. Sept. 1,

1999.

Sec. 2161.002. COMMISSION ADMINISTRATION; COMPTROLLER

ASSISTANCE. (a) To administer Subchapters B and C, the

commission may:

(1) require information from a state agency; and

(2) adopt rules.

(b) Repealed by Acts 2007, 80th Leg., R.S., Ch. 937, Sec.

1.117(6), eff. September 1, 2007.

shall adopt rules that are based on the results of the "State of

Texas Disparity Study, A Report to the Texas Legislature as

Mandated by H.B. 2626, 73rd Legislature, December 1994" (prepared

by National Economic Research Associates, Inc.). The commission

shall revise the rules in response to the findings of any updates

of the study that are prepared on behalf of the state.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 1.22, eff.

Sept. 1, 1999.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.117(6), eff. September 1, 2007.

Sec. 2161.003. AGENCY RULES. A state agency, including an

institution of higher education, shall adopt the commission's

rules under Section 2161.002 as the agency's or institution's own

rules. Those rules apply to the agency's construction projects

and purchases of goods and services paid for with appropriated

money without regard to whether a project or purchase is

otherwise subject to this subtitle.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 1.23, eff. Sept. 1,

1999.

Sec. 2161.004. APPLICABILITY; INTENT. (a) This chapter and

rules adopted by the commission under this chapter apply to state

agency construction projects and purchases of goods and services

that are paid for with appropriated money and made under the

authority of this subtitle or other law.

(b) The legislature intends that all qualified businesses have

access to compete for business from the state.

do not apply to a project or contract subject to Section 201.702,

Transportation Code.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 1.23, eff. Sept. 1,

1999.

Sec. 2161.005. TRANSFER OF FUNDS FOR PURCHASING. If the state

auditor reports to the commission under Section 2161.123(d) that

a state agency is not complying with Section 2161.123, the

commission shall report that fact to the Legislative Budget

Board. If the Legislative Budget Board determines that, one year

after the date of the state auditor's report to the commission,

the agency is still not complying with Section 2161.123, the

budget board may, under Section 69, Article XVI, Texas

Constitution, direct the emergency transfer of the agency's

appropriated funds for making purchases under purchasing

authority delegated under Section 2155.131 or 2155.133 to the

appropriate state agency. The amount transferred from the

agency's funds to the appropriate agency shall be an amount

determined by the Legislative Budget Board.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 1.23, eff. Sept. 1,

1999.

SUBCHAPTER B. GENERAL POWERS AND DUTIES OF COMMISSION

Sec. 2161.061. COMMISSION CERTIFICATION OF HISTORICALLY

UNDERUTILIZED BUSINESSES. (a) The commission shall certify

historically underutilized businesses.

(b) As one of its certification procedures, the commission may:

(1) approve the certification program of one or more local

governments or nonprofit organizations in this state that certify

historically underutilized businesses, minority business

enterprises, women's business enterprises, or disadvantaged

business enterprises under substantially the same definition, to

the extent applicable, used by Section 2161.001, if the local

government or nonprofit organization meets or exceeds the

standards established by the commission; and

(2) certify a business that is certified by a local government

or by a nonprofit organization as a historically underutilized

business under this chapter.

underutilized businesses, the commission shall enter into

agreements with local governments in this state that conduct

certification programs described by Subsection (b) and with

nonprofit organizations. The commission may terminate an

agreement if a local government or nonprofit organization fails

to meet the standards established by the commission for

certifying historically underutilized businesses. The agreements

must take effect immediately and:

(1) allow for automatic certification of businesses certified by

the local government or nonprofit organization;

(2) provide for the efficient updating of the commission

database containing information about historically underutilized

businesses and potential historically underutilized businesses;

and

(3) provide for a method by which the commission may efficiently

communicate with businesses certified by the local government or

nonprofit organization and provide those businesses with

information about the state historically underutilized business

program.

(d) A local government or a nonprofit organization that

certifies historically underutilized businesses, minority

business enterprises, women's business enterprises, or

disadvantaged business enterprises as described in Subsections

(b) and (c) shall complete the certification of an applicant or

provide an applicant with written justification of its

certification denial within the period established by the

commission in its rules for certification activities.

(e) A local government or a nonprofit organization that

certifies historically underutilized businesses under Subsection

approved under Subsection (b) shall make available to the public

an online searchable database containing information about

historically underutilized businesses, minority business

enterprises, women's business enterprises, and disadvantaged

business enterprises certified by the local government or

nonprofit organization, including:

(1) the name of the business;

(2) the contact person or owner of the business;

(3) the address and telephone number of the business;

(4) the type or category of business, including relevant

capabilities of the business and the North American Industry

Classification System codes for the business; and

(5) the expiration date of the business's certification.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1997, 75th Leg., ch. 165, Sec. 17.03(a),

eff. Sept. 1, 1997; Acts 1999, 76th Leg., ch. 1499, Sec. 2.03,

eff. Sept. 1, 1999; Acts 2001, 77th Leg., ch. 1422, Sec. 13.01,

eff. Sept. 1, 2001.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.22, eff. September 1, 2007.

Sec. 2161.062. ASSISTANCE TO HISTORICALLY UNDERUTILIZED

BUSINESSES. (a) The commission shall seek the advice of the

governor, legislature, and state agencies in identifying and

developing opportunities for historically underutilized

businesses.

(b) The commission shall offer historically underutilized

businesses assistance and training regarding state procurement

procedures.

businesses of available state contracts and shall advise

historically underutilized businesses to apply for registration

on the commission's master bidders list.

(d) The commission shall send historically underutilized

businesses an orientation package on certification or

recertification. The package shall include:

(1) a certificate issued in the historically underutilized

business's name;

(2) a description of the significance and value of

certification;

(3) a list of state purchasing personnel;

(4) information regarding electronic commerce opportunities;

(5) information regarding the Texas Marketplace website; and

(6) additional information about the state procurement process.

(e) A state agency with a biennial budget that exceeds $10

million shall designate a staff member to serve as the

historically underutilized businesses coordinator for the agency

during the fiscal year. The procurement director may serve as the

coordinator. In agencies that employ a historically underutilized

businesses coordinator, the position of coordinator, within the

agency's structure, must be at least equal to the position of

procurement director. In addition to any other responsibilities,

the coordinator shall:

(1) coordinate training programs for the recruitment and

retention of historically underutilized businesses;

(2) report required information to the commission; and

(3) match historically underutilized businesses with key staff

within the agency.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 2.04, eff.

Sept. 1, 1999.

Sec. 2161.063. ASSISTING STATE AGENCIES. (a) The commission

shall encourage state agencies to use historically underutilized

businesses by:

(1) working with state agencies to establish a statewide policy

for increasing the use of historically underutilized businesses;

(2) assisting state agencies in seeking historically

underutilized businesses capable of supplying required goods or

services;

(3) assisting state agencies in identifying and advising

historically underutilized businesses on the types of goods and

services the agencies need; and

(4) assisting state agencies in increasing the amount of

business placed with historically underutilized businesses.

(b) The commission shall assist the Texas Department of Economic

Development in performing the department's duties under Section

481.0068.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 2.05, eff.

Sept. 1, 1999.

Sec. 2161.064. DIRECTORY. (a) The commission shall compile, in

the most cost-efficient form, a directory of businesses certified

as historically underutilized businesses under Section 2161.061.

(b) The commission at least semiannually shall update the

directory and provide access to the directory electronically or

in another form to each state agency.

shall provide access to the directory electronically or in

another form.

(d) The commission shall provide a copy of the directory to

every municipality in January and July of each year. On request,

the commission shall make the directory available to other local

governments and the public.

(e) A state agency, including the commission, shall use the

directory in determining awards of state purchasing and public

works contracts.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 2.06, eff.

Sept. 1, 1999.

Sec. 2161.065. MENTOR-PROTEGE PROGRAM. (a) The commission

shall design a mentor-protege program to foster long-term

relationships between prime contractors and historically

underutilized businesses and to increase the ability of

historically underutilized businesses to contract with the state

or to receive subcontracts under a state contract. Each state

agency with a biennial appropriation that exceeds $10 million

shall implement the program designed by the commission.

(b) Participation in the program must be voluntary for both the

contractor and the historically underutilized business

subcontractor.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.08, eff. Sept. 1,

1999.

Sec. 2161.066. HISTORICALLY UNDERUTILIZED BUSINESS FORUMS. (a)

The commission shall design a program of forums in which

historically underutilized businesses are invited by state

agencies to deliver technical and business presentations that

demonstrate their capability to do business with the agency:

(1) to senior managers and procurement personnel at state

agencies that acquire goods and services of a type supplied by

the historically underutilized businesses; and

(2) to contractors with the state who may be subcontracting for

goods and services of a type supplied by the historically

underutilized businesses.

(b) The forums shall be held at state agency offices.

$10 million shall participate in the program by sending senior

managers and procurement personnel to attend relevant

presentations and by informing the agency's contractors about

presentations that may be relevant to anticipated subcontracting

opportunities.

(d) Each state agency that has a historically underutilized

businesses coordinator shall:

(1) design its own program and model the program to the extent

appropriate on the program developed by the commission under this

section; and

(2) sponsor presentations by historically underutilized

businesses at the agency.

(e) The commission and each state agency that has a historically

underutilized businesses coordinator shall aggressively identify

and notify individual historically underutilized businesses

regarding opportunities to make a presentation regarding the

types of goods and services supplied by the historically

underutilized business and shall advertise in appropriate trade

publications that target historically underutilized businesses

regarding opportunities to make a presentation.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.08, eff. Sept. 1,

1999.

SUBCHAPTER C. PLANNING AND REPORTING REQUIREMENTS

Sec. 2161.121. COMMISSION REPORT OF CONTRACTS AWARDED TO

HISTORICALLY UNDERUTILIZED BUSINESSES. (a) The commission shall

prepare a consolidated report that:

(1) includes the number and dollar amount of contracts awarded

and paid to historically underutilized businesses certified by

the commission;

(2) analyzes the relative level of opportunity for historically

underutilized businesses for various categories of acquired goods

and services; and

(3) tracks, by vendor identification number and, to the extent

allowed by federal law, by social security number, the graduation

rates for historically underutilized businesses that grew to

exceed the size standards determined by the commission.

(b) Each state agency shall send to the commission information

required by Section 2161.122 and the commission for the

preparation of the commission's report not later than March 15

and September 15 of each year.

analysis of reports received under Subsection (b) and information

received from the comptroller.

(d) The commission shall send on April 15 of each year a report

on the previous six-month period to the joint committee charged

with monitoring the implementation of the historically

underutilized business goals.

(e) The commission shall send on October 15 of each year a

report on the preceding fiscal year to the presiding officer of

each house of the legislature and the joint committee.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 2.07, eff.

Sept. 1, 1999.

Sec. 2161.122. INFORMATION GATHERING BY STATE AGENCY. (a) To

ensure accuracy in reporting, a state agency shall maintain and

compile monthly information relating to the use by the agency and

each of its operating divisions of historically underutilized

businesses, including information regarding subcontractors and

suppliers required by Subsection (b).

(b) A contractor or supplier awarded a contract by a state

agency shall report to the agency the identity of each

historically underutilized business to whom the contractor or

supplier awarded a subcontract for the purchase of goods or

services.

accordance with Section 2161.125 the following information with

regard to the expenditure of both treasury and nontreasury funds:

(1) the total dollar amount of purchases and payments made under

contracts awarded to historically underutilized businesses;

(2) the number of businesses participating in any issuance of

state bonds by the agency;

(3) the number of contracts awarded to businesses with regard to

the agency's acquisition, construction, or equipping of a

facility or implementation of a program; and

(4) the number of bids, proposals, or other applicable

expressions of interest made by historically underutilized

businesses with regard to the agency's acquisition, construction,

or equipping of a facility or implementation of a program.

(d) A state agency participating in a group purchasing program

shall send to the commission in the agency's report under Section

2161.121 a separate list of purchases from historically

underutilized businesses that are made through the group

purchasing program, including the dollar amount of each purchase

allocated to the reporting agency.

(e) A state agency's report is a record of the agency's

purchases for which the agency selected the vendor. If the vendor

was selected by the commission as part of its state contract

program, the commission shall include the purchase in the

commission's report of its own purchases unless the commission

made a sole source purchase for the agency under Section

2155.067. The state agency for which the purchase was made shall

report the selection of the vendor on its report as if the agency

selected the vendor when the agency drew specifications for goods

or services that are proprietary to one vendor.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 1.24, eff.

Sept. 1, 1999.

Sec. 2161.123. STRATEGIC PLANNING. (a) Each state agency,

including the commission, that is required to have a strategic

plan under Chapter 2056 shall include in its strategic plan a

written plan for increasing the agency's use of historically

underutilized businesses in purchasing and public works

contracting. The governing board of each university system or

institution of higher education not included in a university

system, other than a public junior college, shall prepare a

written plan for increasing the use of historically underutilized

businesses in purchasing and public works contracting by the

system or institution.

(b) The plan must include:

(1) a policy or mission statement relating to increasing the use

of historically underutilized businesses by the state agency;

(2) goals to be met by the agency in carrying out the policy or

mission; and

(3) specific programs to be conducted by the agency to meet the

goals stated in the plan, including a specific program to

encourage contractors to use historically underutilized

businesses as partners and subcontractors.

assistance to a state agency that is preparing its plan.

(d) The commission and the state auditor shall cooperate to

develop procedures providing for random periodic monitoring of

state agency compliance with this section. The state auditor

shall report to the commission a state agency that is not

complying with this section. In determining whether a state

agency is making a good faith effort to comply, the state auditor

shall consider whether the agency:

(1) has adopted rules under Section 2161.003;

(2) has used the commission's directory under Section 2161.064

and other resources to identify historically underutilized

businesses that are able and available to contract with the

agency;

(3) made good faith, timely efforts to contact identified

historically underutilized businesses regarding contracting

opportunities;

(4) conducted its procurement program in accordance with the

good faith effort methodology set out in commission rules; and

(5) established goals for contracting with historically

underutilized businesses in each procurement category based on:

(A) scheduled fiscal year expenditures; and

(B) the availability of historically underutilized businesses in

each category as determined by rules adopted under Section

2161.002.

(e) In conducting an audit of an agency's compliance with this

section or an agency's making of a good faith effort to implement

the plan adopted under this section, the state auditor shall

consider the success or failure of the agency to contract with

historically underutilized businesses in accordance with the

agency's goals described by Subsection (d)(5).

(f) If the state auditor reports to the commission that a state

agency is not complying with this section, the commission shall

assist the agency in complying.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 1.25, eff.

Sept. 1, 1999; Acts 2003, 78th Leg., ch. 785, Sec. 36, eff. Sept.

1, 2003; Acts 2003, 78th Leg., ch. 1266, Sec. 4.08, eff. June 20,

2003.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.23, eff. September 1, 2007.

Sec. 2161.124. STATE AGENCY PROGRESS REPORTS. (a) Each state

agency, including the commission, shall prepare a report for each

fiscal year documenting progress under its plan for increasing

use of historically underutilized businesses.

(b) The commission shall develop a standard form for the report.

lieutenant governor, and the speaker of the house of

representatives not later than December 31 of each year.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 2003, 78th Leg., ch. 785, Sec. 37, eff.

Sept. 1, 2003.

Sec. 2161.125. CATEGORIZATION BY SEX, RACE, AND ETHNICITY. The

comptroller, in cooperation with each state agency reporting

under this subchapter, shall categorize each historically

underutilized business included in a report under this subchapter

by sex, race, and ethnicity.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.24, eff. September 1, 2007.

Sec. 2161.126. EDUCATION AND OUTREACH BY COMMISSION. Before

September 1 of each year, the commission shall report to the

governor, the lieutenant governor, and the speaker of the house

of representatives on the education and training efforts that the

commission has made toward historically underutilized businesses.

The report must include the following as related to historically

underutilized businesses:

(1) the commission's vision, mission, and philosophy;

(2) marketing materials and other educational materials

distributed by the commission;

(3) the commission's policy regarding education, outreach, and

dissemination of information;

(4) goals that the commission has attained during the fiscal

year;

(5) the commission's goals, objectives, and expected outcome

measures for each outreach and education event; and

(6) the commission's planned future initiatives on education and

outreach.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.09, eff. Sept. 1,

1999.

Sec. 2161.127. LEGISLATIVE APPROPRIATIONS REQUESTS. (a) Each

state agency must include as part of its legislative

appropriations request a detailed report for consideration by the

budget committees of the legislature that shows the extent to

which the agency complied with this chapter and rules of the

commission adopted under this chapter during the two calendar

years preceding the calendar year in which the request is

submitted. To the extent the state agency did not comply, the

report must demonstrate the reasons for that fact. The extent to

which a state agency complies with this chapter and rules of the

commission adopted under this chapter is considered a key

performance measure for purposes of the appropriations process.

(b) The report under Subsection (a) must include:

(1) the agency's goals established under Section 2161.123(d)(5)

for contracting with historically underutilized businesses during

the two calendar years preceding the calendar year in which the

request is submitted;

(2) a statement regarding whether the goals established under

Section 2161.123(d)(5) were met during the two calendar years

preceding the calendar year in which the request is submitted;

and

(3) if the goals established under Section 2161.123(d)(5) were

not met during the two calendar years preceding the calendar year

in which the request is submitted:

(A) a statement of the percentage by which the agency's actual

use of historically underutilized businesses deviated from the

agency's goals; and

(B) an explanation of why the goals were not met.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.09, eff. Sept. 1,

1999.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

937, Sec. 1.25, eff. September 1, 2007.

SUBCHAPTER D. PURCHASING GOALS

Sec. 2161.181. GOALS FOR PURCHASES OF GOODS AND SERVICES. A

state agency, including the commission, shall make a good faith

effort to increase the contract awards for the purchase of goods

or services that the agency expects to make during a fiscal year

to historically underutilized businesses based on rules adopted

by the commission to implement the disparity study described by

Section 2161.002(c).

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 1.26, eff.

Sept. 1, 1999.

Sec. 2161.182. GOALS FOR CONSTRUCTION CONTRACTS. (a) A state

agency that contracts for a construction project, including a

project under Section 2166.003, shall make a good faith effort to

increase the construction contract awards that the agency expects

to make during a fiscal year to historically underutilized

businesses based on rules adopted by the commission to implement

the disparity study described by Section 2161.002(c).

(b) In this section, "project" has the meaning assigned by

Section 2166.001.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995. Amended by Acts 1999, 76th Leg., ch. 1499, Sec. 1.27, eff.

Sept. 1, 1999.

Sec. 2161.183. ESTIMATE OF EXPECTED CONTRACT AWARDS. (a) Not

later than the 60th day of its fiscal year, a state agency,

including the commission:

(1) shall estimate the total value of contract awards the agency

expects to make for that fiscal year that are subject to Section

2161.181; and

(2) shall estimate the total value of contract awards the agency

expects to make for that fiscal year under Chapter 2166.

(b) The state agency may revise an estimate as new information

requires.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995.

SUBCHAPTER E. PENALTY

Sec. 2161.231. PENALTY. (a) A person commits an offense if the

person:

(1) intentionally applies as a historically underutilized

business for an award of a purchasing contract or public works

contract under this subtitle; and

(2) knows the person is not a historically underutilized

business.

(b) An offense under this section is a third degree felony.

Added by Acts 1995, 74th Leg., ch. 41, Sec. 1, eff. Sept. 1,

1995.

SUBCHAPTER F. SUBCONTRACTING

Sec. 2161.251. APPLICABILITY. (a) This subchapter applies to

all contracts entered into by a state agency with an expected

value of $100,000 or more, including:

(1) contracts for the acquisition of a good or service; and

(2) contracts for or related to the construction of a public

building, road, or other public work.

(b) This subchapter applies to the contract without regard to:

(1) whether the contract is otherwise subject to this subtitle;

(2) the source of funds for the contract, except that to the

extent federal funds are used to pay for the contract, this

subchapter does not apply if federal law prohibits the

application of this subchapter in relation to the expenditure of

federal funds.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.10, eff. Sept. 1,

1999.

Sec. 2161.252. AGENCY DETERMINATION REGARDING SUBCONTRACTING

OPPORTUNITIES; BUSINESS SUBCONTRACTING PLAN. (a) Each state

agency that considers entering into a contract with an expected

value of $100,000 or more shall, before the agency solicits bids,

proposals, offers, or other applicable expressions of interest

for the contract, determine whether there will be subcontracting

opportunities under the contract. If the state agency determines

that there is that probability, the agency shall require that

each bid, proposal, offer, or other applicable expression of

interest for the contract include a historically underutilized

business subcontracting plan.

(b) When a state agency requires a historically underutilized

business subcontracting plan under Subsection (a), a bid,

proposal, offer, or other applicable expression of interest for

the contract must contain a plan to be considered responsive.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.10, eff. Sept. 1,

1999.

Sec. 2161.253. GOOD FAITH COMPLIANCE WITH BUSINESS

SUBCONTRACTING PLAN. (a) When a state agency requires a

historically underutilized business subcontracting plan under

Section 2161.252, the awarded contract shall contain, as a

provision of the contract that must be fulfilled, the plan that

the contractor submitted in its bid, proposal, offer, or other

applicable expression of interest for the contract. The

contractor shall make good faith efforts to implement the plan. A

contractor's participation in a mentor-protege program under

Section 2161.065 and submission of a protege as a subcontractor

in the contractor's historically underutilized business

subcontracting plan constitutes a good faith effort under this

section for the particular area of the subcontracting plan

involving the protege.

(b) To the extent that subcontracts are not contracted for as

originally submitted in the historically underutilized business

subcontracting plan, the contractor shall report to the state

agency all the circumstances that explain that fact and describe

the good faith efforts made to find and subcontract with another

historically underutilized business.

with the historically underutilized business subcontracting plan.

In determining whether the contractor made the required good

faith effort, the agency may not consider the success or failure

of the contractor to subcontract with historically underutilized

businesses in any specific quantity. The agency's determination

is restricted to considering factors indicating good faith.

(d) If a determination is made that the contractor failed to

implement the plan in good faith, the agency, in addition to any

other remedies, may bar the contractor from further contracting

opportunities with the agency.

(e) The commission shall adopt rules to administer this

subchapter.

Added by Acts 1999, 76th Leg., ch. 1499, Sec. 2.10, eff. Sept. 1,

1999. Amended by Acts 2001, 77th Leg., ch. 1422, Sec. 13.02, eff.

Sept. 1, 2001.

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

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