Part 1.
OFFICE OF THE GOVERNOR
Chapter 5.
BUDGET AND PLANNING OFFICE
Subchapter A. FEDERAL AND INTERGOVERNMENTAL COORDINATION
4.
UNIFORM GRANT AND CONTRACT MANAGEMENT STANDARDS
1 TAC §5.141, §5.144
The Office of the Governor adopts amendments to §§5.141
and 5.144 of the Uniform Grant Management Standards without changes to the
text as published in the December 5, 2003,
Texas
Register
(28 TexReg 10847).
These amendments correct typographical errors and clarify certain provisions
in the cost principles adopted by reference from OMB Circular A-87, the grant
administration requirements adopted by reference from the Common Rule of OMB
Circular A-102 and single audit requirements adopted by reference from OMB
Circular A-133. The amendments also make substantive changes to selected provisions
of the state single audit circular.
The following entities furnished comments on the proposed amendments:
Texas Department of Health
Collin County Office of County Auditor
The Texas Department of Health commented on Uniform Grant Management Standard
III, Subpart C ____.32 (d) (3). This section was not a proposed amendment,
nor posted for comment.
The Collin County Auditor has requested that Uniform Grant Management Standard
II, Attachment E, Part E (2) (e) not be amended. The Auditor contends that
the omission of the 10 percent, non-negotiated, indirect cost rate will have
a negative funding impact.
The Office of the Governor disagrees with this comment. Unique assessment
of allocable costs will enhance internal control and ensure efficient financial
management systems. The grantee should consult their primary federal funding
source to negotiate an appropriate indirect cost rate.
The amendments are proposed under Chapter 783, Texas Government
Code, which directs the Governor's office to develop uniform grant and contract
management standards to promote the efficient use of public funds.
The Government Code, §783.006, is affected by the proposed amendments.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on May 27, 2004.
TRD-200403582
Katherine Knight
Assistant General Counsel
Office of the Governor
Effective date: June 16, 2004
Proposal publication date: December 5, 2003
For further information, please call: (512) 463-3471
Chapter 111.
EXECUTIVE ADMINISTRATION DIVISION
Subchapter B. HISTORICALLY UNDERUTILIZED BUSINESS PROGRAM
1 TAC §111.14
The Texas Building and Procurement Commission adopts the
repeal of 1 TAC, Chapter 111, Subchapter B, §111.14 concerning subcontracting
for Historically Underutilized Business Program (HUB) as published in the
February 6, 2004 edition of the
Texas Register
(29
TexReg 1113). The section outlines the steps to be followed in determining
whether subcontracting opportunities are probable under a contract, the good
faith required in developing a HUB subcontracting plan, submission and review
during contract performance, and contract compliance.
The repeal is necessary because this section is being replaced with a new §111.14
approved by the commissioners and published concurrently in this issue of
the
Texas Register
.
Repealing the rule allows for a new rule which will function more effectively
because it more correctly reflects the statutes, will meet the objectives
of the program, and addresses concerns raised by interested parties.
The repeal of §111.14 is adopted under the authority the
Texas Government Code, Title 10, Subtitle D, §§2152.003, 2161.002,
and 2161.253.
The following statutes are affected by the rules: Texas Government Code,
Chapters 2161.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on May 25, 2004.
TRD-200403552
Cynthia de Roch
General Counsel
Texas Building and Procurement Commission
Effective date: June 14, 2004
Proposal publication date: February 6, 2004
For further information, please call: (512) 463-4257
1 TAC §111.14
The Texas Building and Procurement Commission adopts new
rules in Texas Administrative Code, Title 1, Part 5, Chapter 111, Subchapter
B, §111.14 concerning the administration of the historically underutilized
business subcontracting plan, with changes in the proposed text as published
in the February 6, 2004 edition of the
Texas Register
(29 TexReg 1113).
The new rules with changes relate to the administration of the historically
underutilized business plan, including steps in making/determining good faith
effort, agency compliance requirements, and required reports.
Texas Administrative Code, Title 1, Part 5, Chapter 111, Subchapter B, §111.14
establishes administrative procedures for a state entity to require, determine
good faith effort, and administer the historically underutilized business
subcontracting plan.
The Commission received written comments on the proposed new rules from:
The Commission received comment from the following legislators, trade associations,
businesses, and state agencies :
State Senators Gonzalo Barrientos and Juan "Chuy" Hinojosa,State Senator
Leticia Van de Putte, State Senator Mario Gallegos Jr.;
El Paso Hispanic Chamber of Commerce, Texas Association of Mexican American
Chambers of Commerce & Lubbock Hispanic Chamber of Commerce;
Dallas-based Diverse Supplier Advocacy Organizations and Central and South
Texas Minority Business Council
Texas Certified Development Company;
Hispanic Contractors Association of Texas/South Texas/Greater Houston Area/Dallas
and Texas Association of African American Chambers of Commerce;
Q2 Communications;
Texas Workforce Commission, Texas A&M University System - Facilities
Planning and Construction, Texas Tech University System and John Lopez, HUB
Coordinator for the University of Texas at Arlington.
regarding the following proposed language:
"The respondent shall provide the notice described
in this section to three or more HUBs per each subcontracting opportunity
that provide the type of work required for each subcontracting opportunity
identified in the contract specifications or any other subcontracting opportunity
the respondent cannot complete with its own equipment, supplies, materials,
and/or employees. If more than three subcontracting opportunities are identified
the respondent shall contact a total minimum of nine (9) HUBs. "
The comments expressed opposition to the proposed language which allows
a respondent to contact a minimum of nine (9) HUBs if more than three subcontracting
opportunities are identified. The reasons for the opposition were centered
around the conclusion that the proposed language would be detrimental to the
HUB program because it would discourage HUB subcontracting outreach efforts
and therefore ultimately limit subcontracting opportunities for HUBs, especially
in construction projects. These respondents all requested that the current
language remain unchanged, which would require prime contractors to contact
three (3) or more qualified HUBs for every subcontracting opportunity identified
by the agency.
RESPONSE: Revisions were proposed to the current language in an effort
to reduce response costs on State solicitations. These proposed revisions
respond to complaints from the HUB community that prime contractors simply
go through the motions with regard to contacting HUBs. Many HUBs spend countless
hours responding to phantom subcontracting opportunities from responders to
State solicitations only to discover that the responder is only "going through
the motions" to meet good faith effort criteria.
The proposed language was not intended to limit contacts, but to serve
as a minimum threshold for meeting good faith effort requirements. Responders
are free to make more contacts as long as they meet the minimum threshold.
This cost/time saving language will maximize actual subcontracting opportunities,
while keeping costs down. During Fiscal Year 2003, HUB subcontracting increased
by 32%, which indicates that streamlined, more efficient processes will contribute
to increasing HUB utilization and keeping costs down.
In addition, the proposed language adds a requirement to provide notice
of subcontracting opportunities to minority or women trade organizations or
development centers to assist in identifying HUBs by disseminating subcontracting
opportunities to their membership/participants as part of the good faith effort.
This effort alone will provide more opportunities for HUBs and HUB eligible
businesses than a process of "going through the motions" to satisfy arduous
and expensive requirements. This effort is a requirement of good faith effort
and will increase the number of qualified HUBs receiving notice of subcontracting
opportunities.
In final response to the comments, TBPC has deleted the language "If more
than three subcontracting opportunities are identified the respondent shall
contact a total minimum of nine (9) HUBs."
The Commission received comment from the following businesses and state
agencies:
BLGY
Texas A&M University System
The University of Texas System
Texas Workforce Commission
Texas Education Agency
regarding the following proposed language:
"A subcontracting plan for a professional services
contract which meets or exceeds HUB participation goals in §111.13 of
this title (relating to Annual Procurement Utilization Goals), constitutes
good faith effort under this section... "
Most of the comments expressed opposition or posed questions regarding
the proposed language. The reasons for opposition included the perception
that the language implemented a quota for contracting with HUBs or put undue
pressure on contractors to hire minority subcontractors. In addition, there
were concerns that the proposed language goes beyond statutory requirements.
One commenter supported the proposed language wholeheartedly agreeing that
good faith efforts should be considered as having been met if the HUB Subcontracting
Plan meets or exceeds state goals for participation. Comment in support of
the proposed language included the following statement:
"In my profession, questionable use of time and awkward communications take
place when three firms in each discipline must occur. It is a painfully shallow
and inefficient method for doing business when you already know how you want
to hire based on qualifications rather than price, but are forced to raise
the anticipation of others who ultimately learn that their responses are simply
a necessity to ensure compliance with a state requirement that was not properly
thought out to begin with."
RESPONSE: Revisions were proposed in an effort to more efficiently procure
professional services for the State of Texas. Since the procurement of professional
services is based on qualifications versus a competitive bidding process,
the provision of notice to three HUB firms per subcontracting opportunity
is typically only an exercise in paperwork.
Different good faith effort requirements were proposed for professional
services because different procurement methods are used with regard to professional
services.
On a HUB Subcontracting Plan, a contactor will be making a
good faith effort
to meet or exceed the annual procurement utilization
goals. The proposed language provides an option, which is more conducive to
the procurement methods used for professional services and in no way imposes
a quota. The intent to meet or exceed the annual procurement utilization goals
as written in the HUB Subcontracting Plan is the demonstration of good faith
effort.
If those goals are ultimately not met, it is the responsibility of the
contracting agency to determine if the contractor made a good faith effort
to comply with its HUB Subcontracting Plan. This alternative means for meeting
the good faith effort requirement is cost and time effective, more conducive
to the procurement methods used in professional services, and does not establish
a quota. A quota is a required minimum standard/number that MUST be met. This
proposed language simply provides a more productive alternative for meeting
HUB goals, which are traditionally not met through existing good faith effort
requirements.
The Commission received comment from the following state agencies
Texas Tech University System
Texas Health and Human Services Commission
Texas A&M University System
The University of Texas System
Hispanic Contractors Association of Texas/South Texas/Greater Houston Area/Dallas
and Texas Association of African American Chambers of Commerce
Texas Department of Transportation
Texas Education Agency
regarding the following proposed language:
Most of the state agencies expressed opposition
or raised questions regarding the mandatory use of HUB Subcontracting Plan
forms developed by the TBPC. The reasons for opposition included doubt that
one form could be developed by the TBPC that would serve the diverse needs
of all state agencies and a preference for the use of customized agency-specific
HUB Subcontracting Plan forms. Agencies also recommended that the TBPC obtain
agency input/feedback regarding the development of these forms.
One organization concurred with TBPC's proposed with the understanding
that HUB organizations would have an opportunity to review and comment on
these forms.
RESPONSE: Standardized forms for the HUB Subcontracting Plan increase consistency
and compliance. In addition, state respondents to solicitations should not
have to address a different form for each state agency when the same good
faith effort requirements have to be met for each HUB Subcontracting Plan.
Although it may be more convenient for agencies to develop their own HUB Subcontracting
Plan forms, it provides a better service to the State's contractors/respondents
to have standard forms which are consistent from one agency to the next.
The TBPC envisions at least two standardized forms (a short form and a
long form) to address the differing contracting needs of each agency. In addition,
these forms will be developed with the valuable input of user agencies and
businesses.
The Commission received comment from the following trade associations and
businesses:
Hispanic Contractors Association of Texas/South Texas/Greater Houston Area/Dallas
and Texas Association of African American Chambers of Commerce
The University of Texas System
regarding the following proposed language:
"Respondent must provide notice to organizations
or development centers not less than five (5) working days for construction
contracts prior to submission of the response (bid, proposal, offer, of other
applicable expression of interest)."
"Reasonable time to respond" in this context is
no less than five (5) working days for construction contracts..."
Comments unanimously recommended that the language be revised to define
reasonable time to respond as 10 working days for construction related projects.
RESPONSE: The TBPC endeavors to simplify the requirements of the HUB Subcontracting
Plan by providing as much consistency as possible in the good faith effort
requirements. Construction-related procurements have already been given a
greater opportunity to increase HUB subcontracting, as well as prepare better
HUB Subcontracting Plans with the additional 24-hour period to submit the
HUB Subcontracting Plan. Extending the "reasonable time to respond" timeframe
may cost state agencies more time/money, especially for special trade construction
projects, which generally have a shorter turnaround time.
The Commission received comment from the following trade associations:
Hispanic Contractors Association of Texas/South Texas/Greater Houston Area/Dallas
and Texas Association of African American Chambers of Commerce
El Paso Hispanic Chamber of Commerce
regarding the following proposed language:
"If subcontracting opportunities are probable,
each agency's invitation for bids, requests for proposals or other purchase
solicitation documents for construction, professional services, other services,
and commodities with an expected value of $100,000 or more shall state that
probability and require a HUB subcontracting plan."
Comments unanimously recommended that the language be revised to require
agencies to identify subcontracting opportunities that are probable within
the contract, not just state that subcontracting is probable.
RESPONSE: The TBPC made no changes to the existing language. Although changes
were discussed and proposed at another time, the TBPC ultimately, through
various focus group discussions decided to leave the language unchanged. Reasons
for leaving the existing language unchanged include the fact that state agencies
are frequently not experts on what they purchase and are not always easily/efficiently
able to identify each and every subcontracting opportunity. In addition, it
was suggested by many organizations and agencies involved in focus group discussions
that the marketplace is better suited to determine subcontracting opportunities.
The new rules are authorized under the Texas Government Code,
Title 10, Subtitle D, §2161.002 and §2161. 253.
The following code is affected by these rules: Government Code, Title 10,
Chapter 2161.
§111.14.Subcontracts.
(a)
General Provisions
(1)
In accordance with Texas Government Code, Chapter 2161,
Subchapter F, 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, determine
whether subcontracting opportunities are probable under the contract.
(A)
State agencies shall use the following steps to determine
if subcontracting opportunities are probable under the contract:
(i)
Use the HUB participation goals in §111.13 of this
title (relating to Annual Procurement Utilization Goals); and
(ii)
Research the Centralized Master Bidders List, the HUB
Directory, the Internet, and other directories, identified by the commission,
for HUBs that may be available to perform the contract work.
(B)
In addition, determination of subcontracting opportunities
may include, but is not limited to, the following:
(i)
contacting other state and local agencies and institutions
of higher education to obtain information regarding similar contracting and
subcontracting opportunities; and
(ii)
reviewing the history of similar agency purchasing transactions.
(2)
If subcontracting opportunities are probable, each agency's
invitation for bids, requests for proposals or other purchase solicitation
documents for construction, professional services, other services, and commodities
with an expected value of $100,000 or more shall state that probability and
require a HUB subcontracting plan.
(A)
The HUB subcontracting plan shall be submitted at the same
time as the response (bid, proposal, offer, or other applicable expression
of interest), except for construction contracts involving alternative delivery
methods. For construction contracts involving alternative delivery methods,
the HUB subcontracting plan may be submitted up to 24 hours following the
date/time that responses are due provided that responses are not opened until
the HUB subcontracting plan is received.
(B)
Responses that do not include a completed HUB subcontracting
plan in accordance with paragraph (3) of this section, shall be rejected due
to material failure to comply with advertised specifications in accordance
with §113.6 (a) of this title (relating to Bid Evaluation and Award).
(3)
A state agency shall require a respondent to state whether
it is a certified HUB. A state agency shall also require a respondent to state
overall subcontracting and overall certified HUB subcontracting to be provided
in the contract. Respondents shall follow procedures in subsection (a)(3)(A)(i),
(a)(3)(A)(ii), and (a(3)(A)(iii) of this section when developing the HUB subcontracting
plan.
(A)
The HUB subcontracting plan shall consist of completed
forms prescribed by the Texas Building and Procurement Commission and shall
include the following:
(i)
certification that respondent has made a good faith effort
to meet the requirements of this section;
(ii)
identification of the subcontractors that will be used
during the course of the contract;
(iii)
the expected percentage of work to be subcontracted;
and
(iv)
and the approximate dollar value of that percentage of
work. The plan shall include goals established pursuant to §111.13 of
this title (relating to Annual Procurement Utilization Goals).
(B)
The successful respondent shall provide all additional
documentation required by the agency to demonstrate compliance with good faith
effort requirements prior to contract award. If the successful respondent
is unable to provide supporting documentation (phone logs, fax transmittals,
electronic mail, etc.) within the timeframe specified by the agency to demonstrate
compliance with this subsection prior to contract award, that respondent's
bid/proposal shall be rejected for material failure to comply with advertised
specifications.
(b)
Construction Contracts.
(1)
Evidence of good faith effort in developing a HUB subcontracting
plan for construction contracts, including heavy construction, building construction,
and special trade construction includes, but is not limited to, the following
procedures:
(A)
Divide the contract work into reasonable lots or portions
to the extent consistent with prudent industry practices.
(B)
Provide written justification of the selection process
if a non HUB subcontractor is selected.
(C)
Provide notice to minority or women trade organizations
or development centers to assist in identifying HUBs by disseminating subcontracting
opportunities to their membership/participants. The notice shall, in all instances,
include the scope of work, information regarding location to review plans
and specifications, information about bonding and insurance requirements,
and identify a contact person. Respondent must provide notice to organizations
or development centers no less than five (5) working days for construction
contracts prior to submission of the response (bid, proposal, offer, or other
applicable expression of interest).
(D)
Notify HUBs of the subcontracting opportunities that the
respondent intends to subcontract. The preferable method of notification shall
be in writing. The notice shall, in all instances, include the scope of the
work, information regarding the location to review plans and specifications,
information about bonding and insurance requirements, and identify a contact
person. The notice shall be provided to potential HUB subcontractors prior
to submission of the respondent's response.
(2)
The respondent shall provide potential HUB subcontractors
reasonable time to respond to the respondent's notice. "Reasonable time to
respond" in this context is no less than five (5) working days for construction
contracts, including heavy construction, building construction, and special
trade construction, from receipt of notice, unless circumstances require a
different time period, which is determined by the agency and documented in
the contract file.
(3)
The respondent shall use the commission's Centralized Master
Bidders List, the HUB Directory, Internet resources, and/or other directories
as identified by the commission or agency when searching for HUB subcontractors.
Respondents may rely on the services of minority, women, and community organizations
contractor groups, local, state, and federal business assistance offices,
and other organizations that provide assistance in identifying qualified applicants
for the HUB program who are able to provide all or select elements of the
HUB subcontracting plan.
(4)
The respondent shall provide the notice described in this
section to three or more HUBs per each subcontracting opportunity that provide
the type of work required for each subcontracting opportunity identified in
the contract specifications or any other subcontracting opportunity the respondent
cannot complete with its own equipment, supplies, materials, and/or employees.
The respondent must document the HUBs contacted on the forms prescribed by
the Texas Building and Procurement Commission.
(c)
Professional Services Contracts.
(1)
Evidence of good faith effort in developing a HUB subcontracting
plan for professional services contracts is established if the prime contractor
meets the following conditions and procedures:
(A)
A HUB subcontracting plan for a professional services contract
which meets or exceeds HUB participation goals in §111.13 of this title
(relating to Annual Procurement Utilization Goals), constitutes good faith
effort under this section, or
(B)
Develop a HUB Subcontracting Plan under the following procedures:
(i)
Divide the contract work into reasonable lots or portions
to the extent consistent with prudent industry practices.
(ii)
Notify HUBs of the subcontracting opportunities that the
respondent intends to subcontract. The preferable method of notification shall
be in writing. The notice shall, in all instances, include the scope of the
work, required qualifications, and identify a contact person. The notice shall
be provided to potential HUB subcontractors prior to submission of the respondent's
response.
(2)
The respondent shall provide potential HUB subcontractors
reasonable time to respond to the respondent's notice. "Reasonable time to
respond" in this context is no less than five (5) working days from receipt
of notice, unless circumstances require a different time period, which is
determined by the agency and documented in the contract file.
(3)
The respondent shall use the commission's Centralized Master
Bidders List, the HUB Directory, Internet resources, and/ or other directories
as identified by the commission or agency when searching for HUB subcontractors.
Respondents may rely on the services of minority, women, and community organizations,
contractor groups, local, state, and federal business assistance offices,
and other organizations that provide assistance in identifying qualified applicants
for the HUB program who are able to provide all or select elements of the
HUB subcontracting plan.
(4)
The respondent shall provide the notice described in this
section to three or more HUBs per each subcontracting opportunity that provide
the type of work required for each subcontracting opportunity identified in
the contract specifications or any other subcontracting opportunity the respondent
cannot complete with its own equipment, supplies, materials, and/or employees.
The respondent must document the HUBs contacted on the forms provided by the
Texas Building and Procurement Commission.
(A)
Provide written justification of the selection process
if a non HUB subcontractor is selected.
(B)
Provide notice to minority or women trade organizations
or development centers to assist in identifying HUBs by disseminating subcontracting
opportunities to their membership/participants. The notice shall, in all instances,
include the scope of the work, required qualifications, and identify a contact
person. Respondent must provide notice to organizations or development centers
no less than five (5) working days prior to submission of response (bid, proposal,
offer, or other applicable expression of interest).
(d)
Commodities and Other Services Contracts.
(1)
Evidence of good faith effort in developing a HUB subcontracting
plan for commodities and other services contracts includes, but is not limited
to, the following procedures:
(A)
Divide the contract work into reasonable lots or portions
to the extent consistent with prudent industry practices.
(B)
Notify HUBs of the subcontracting opportunities that the
respondent intends to subcontract. The preferable method of notification shall
be in writing. The notice shall, in all instances, include the scope of the
work, specifications, and identify a contact person. The notice shall be provided
to potential HUB subcontractors prior to submission of the respondent's response.
(i)
The respondent shall provide potential HUB subcontractors
reasonable time to respond to the respondent's notice. "Reasonable time to
respond" in this context is no less than five working days from receipt of
notice, unless circumstances require a different time period, which is determined
by the agency and documented in the contract file.
(ii)
The respondent shall use the commission's Centralized
Master Bidders List, the HUB Directory, Internet resources, and/or other directories
as identified by the commission or agency when searching for HUB subcontractors.
Respondents rely on the services of minority, women, and community organizations,
contractor groups, local, state, and federal business assistance offices,
and other organizations that provide assistance in identifying qualified applicants
for the HUB program who are able to provide all or select elements of the
HUB subcontracting plan.
(iii)
The respondent shall provide the notice described in
this section to three or more HUBs per each subcontracting opportunity that
provide the type of work required for each subcontracting opportunity identified
in the contract specifications or any other subcontracting opportunity the
respondent cannot complete with its own equipment, supplies, materials, and/or
employees. The respondent must document the HUBs contacted on the forms provided
by the Texas Building and Procurement Commission.
(C)
Provide written justification of the selection process
if a non HUB subcontractor is selected.
(D)
Provide notice to minority or women trade organizations
or development centers to assist in identifying HUBs by disseminating subcontracting
opportunities to their membership/participants. The notice shall, in all instances,
include the scope of the work, specifications, and identify a contact person.
Respondent must provide notice to organizations or development centers no
less than five (5) working days for construction contracts prior to submission
of the response (bid, proposal, offer, or other applicable expression of interest).
(2)
In making a determination if a good faith effort has been
made in the development of the required HUB subcontracting plan, a state agency
may require the respondent to submit supporting documentation explaining how
the respondent has made a good faith effort according to each criterion listed
in subsection (a)(3)(A)(i), (a)(3)(A)(ii), and (a)(3)(A)(iii) of this section.
The documentation shall include at least the following:
(A)
how the respondent divided the contract work into reasonable
lots or portions consistent with prudent industry practices;
(B)
how the respondent's notices contain adequate information
about bonding, insurance, the availability of plans, the specifications, scope
of work, required qualifications and other requirements of the contract allowing
reasonable time for HUBs to participate effectively;
(C)
how the respondent negotiated in good faith with qualified
HUBs, not rejecting qualified HUBs who were also the best value responsive
bidder;
(D)
how the respondent provided notice to minority or women
trade organizations or development centers to assist in identifying HUBs by
disseminating subcontracting opportunities to their membership/participants;
and
(E)
for contracts subject to (c)(1)(A), how the respondent
plans to subcontract with certified HUBs in an effort to meet or exceed HUB
participation goals in §111.13 of this title (relating to Annual Procurement
Utilization Goals) for each identified subcontracting opportunity.
(3)
A respondent's participation in a Mentor Protégé
Program under the Texas Government Code §2161.065, and the submission
of a protégé as a subcontractor in the HUB subcontracting plan
constitutes a good faith effort for the particular area to be subcontracted
with the protégé. When submitted, state agencies may accept
a Mentor Protégé Agreement that has been entered into by the
respondent (mentor) and a certified HUB (protégé). The agency
shall consider the following in determining the respondent's good faith effort:
(A)
if the respondent has entered into a fully executed Mentor
Protégé Agreement that has been registered with the commission
prior to submitting the plan, and
(B)
if the respondent's HUB subcontracting plan identifies
the areas of subcontracting that will be performed by the protégé.
(4)
If the respondent is able to fulfill any of the potential
subcontracting opportunities identified with its own equipment, supplies,
materials and/or employees, respondent must sign an affidavit and provide
a statement explaining how the respondent intends to fulfill each subcontracting
opportunity. The respondent must agree to provide the following if requested
by the agency:
(A)
evidence of existing staffing to meet contract objectives;
(B)
monthly payroll records showing company staff fully engaged
in the contract; and
(C)
on site reviews of company headquarters or work site where
services are to be performed.
(D)
documentation proving employment of qualified personnel
holding the necessary licenses and certificates required to perform the work.
(5)
The HUB subcontracting plan shall be reviewed and evaluated
prior to contract award and, if accepted, shall become a provision of the
agency's contract. Revisions necessary to clarify and enhance information
submitted in the original HUB subcontracting plan may be made in an effort
to determine good faith effort. State agencies shall review the documentation
submitted by the respondent to determine if a good faith effort has been made
in accordance with this section. If the agency determines that a submitted
HUB subcontracting plan was not developed in good faith, the agency shall
treat the lack of good faith as a material failure to comply with advertised
specifications, and the subject response (bid, proposal, offer, or other applicable
expression of interest) shall be rejected. The reasons for rejection shall
be recorded in the procurement file.
(6)
If the respondent is selected and decides to subcontract
any part of the contract after the award, as a provision of the contract,
the contractor/vendor must comply with provisions of this section relating
to developing and submitting a subcontracting plan before any modifications
or performance in the awarded contract involving subcontracting can be authorized
by the state agency. If the selected contractor/vendor subcontracts any of
the work without prior authorization and without complying with this section,
the contractor/vendor would be deemed to have breached the contract and be
subject to any remedial actions provided by Texas Government Code, Chapter
2161, state law and this section. Agencies may report nonperformance relative
to its contracts to the commission in accordance with Chapter 113, Subchapter
F of this title (relating to the Vendor Performance and Debarment Program).
(7)
If at any time during the term of the contract, a contractor/vendor
desires to make changes to the approved subcontracting plan, proposed changes
must be received for prior review and approval by the state agency before
changes will be effective under the contract. The contractor/vendor must comply
with provisions of subsection (a), paragraph 3, relating to developing and
submitting a subcontracting plan for substitution of work or of a subcontractor,
prior to any alternatives being approved under the subcontracting plan. The
state agency shall approve changes by amending the contract or by another
form of written agency approval. The reasons for amendments or other written
approval shall be recorded in the procurement file.
(8)
If a state agency expands the original scope of work through
a change order or contract amendment, including a contract renewal that expands
the scope of work, the state agency shall determine if the additional scope
of work contains additional probable subcontracting opportunities not identified
in the initial solicitation. If the agency determines additional probable
subcontracting opportunities exist, the agency will require the contractor/vendor
to submit a HUB subcontracting plan/revised HUB subcontracting plan for the
additional probable subcontracting opportunities.
(9)
The HUB subcontracting plan/revised HUB subcontracting
plan shall comply with the provisions of this section relating to development
and submission of a subcontracting plan before any modifications or performance
in the awarded contract involving the additional scope of work can be authorized
by the agency. If the contractor/vendor subcontracts any of the additional
subcontracting opportunities identified by the agency without prior authorization
and without complying with this section, the contractor/vendor would be deemed
to have breached the contract and be subject to any remedial actions provided
by Texas Government Code, Chapter 2161, state law and this section. Agencies
may report nonperformance relative to its contracts to the commission in accordance
with Chapter 113, Subchapter F of this title (relating to the Vendor Performance
and Debarment Program.)
(10)
The contractor/vendor shall maintain business records
documenting its compliance with the HUB subcontracting plan and shall submit
a compliance report to the contracting agency monthly and in the format required
by the Texas Building and Procurement Commission. The compliance report submission
shall be required as a condition for payment.
(11)
During the term of the contract, the state agency shall
monitor the HUB subcontracting plan monthly to determine if the value of the
subcontracts to HUBs meets or exceeds the HUB subcontracting provisions specified
in the contract. Accordingly, state agencies shall audit and require a contractor/vendor
to whom a contract has been awarded to report to the agency the identity and
the amount paid to its subcontractors in accordance with §111.16(c) of
this title (relating to State Agency Reporting Requirements). If the contractor/vendor
is meeting or exceeding the provisions, the state agency shall maintain documentation
of the contractor's/vendor's efforts in the contract file. If the contractor/vendor
fails to meet the HUB subcontracting provisions specified in the contract,
the state agency shall notify the contractor of any deficiencies. The state
agency shall give the contractor/vendor an opportunity to submit documentation
and explain to the state agency why the failure to fulfill the HUB subcontracting
plan should not be attributed to a lack of good faith effort by the contractor/vendor.
(12)
To determine if the contractor/vendor made the required
good faith effort, the agency may not consider the success or failure of the
contractor/vendor to subcontract with HUBs in any specific quantity. The agency's
determination is restricted to considering factors indicating good faith effort
including, but not limited to, the following:
(A)
whether the contractor gave timely notice to the subcontractor
regarding the time and place of the subcontracted work;
(B)
whether the contractor facilitated access to the work site,
electrical power, and other necessary utilities; and
(C)
whether documentation or information was provided that
included potential changes in the scope of contract work.
(13)
If a determination is made that the contractor/vendor
failed to implement the HUB subcontracting plan in good faith, the agency,
in addition to any other remedies, may report nonperformance to the commission
in accordance with Chapter 113, Subchapter F of this title (relating to Vendor
Performance and Debarment Program). In addition, if the contractor/vendor
failed to implement the subcontracting plan in good faith, the agency may
revoke the contract for breach of contract and make a claim against the contractor/vendor.
(14)
State agencies shall review their procurement procedures
to ensure compliance with this section. In accordance with §111.26 of
this title (relating to HUB coordinator responsibilities) the agency's HUB
coordinator and contract administrators should facilitate institutional compliance
with this section.
This agency hereby certifies that the adoption has been
reviewed by legal counsel and found to be a valid exercise of the agency's
legal authority.
Filed with the Office of
the Secretary of State on May 25, 2004.
TRD-200403553
Cynthia de Roch
General Counsel
Texas Building and Procurement Commission
Effective date: June 14, 2004
Proposal publication date: February 6, 2004
For further information, please call: (512) 463-4257
Subchapter A. PURCHASING
1 TAC §113.11
The Texas Building and Procurement Commission (TBPC) adopts
amendments to 1 TAC Chapter 113, Subchapter A, §113.11, relating to delegated
purchases, without changes to the proposed text as published in the March
12, 2004, issue of the
Texas Register
(29
TexReg 2487).
The adoption and subsequent implementation of the changes will serve to
bring delegated purchasing procedures more in line with pricing structures
and business practices of the commercial marketplace. In addition, the rule
changes will allow state agencies to exercise more flexibility in making delegated
purchases, which will result in greater efficiencies and reduced administrative
costs associated with the solicitation process.
The amendments revise the monetary thresholds for each type of competitive
process used for purchases made by state agencies through their delegated
purchasing authority. Under delegated purchasing authority, agencies are allowed
to make their own purchases, but must follow TBPC rules and procedures.
The changes to the monetary thresholds are summarized below:
Figure: 1 TAC Chapter 113--Preamble
The public comment period ended on April 11, 2004. No public comments were
received.
The amendments are adopted under the authority of the Texas Government
Code, Title 10, Subtitle D, §2152.003 and §2155.132
The following code is affected by the adopted amendments: Texas Government
Code, Title 10, Subtitle D, §§2155.132, 2155.264, 2155.265, and
2167.064.
This agency hereby certifies that the adoption has been reviewed
by legal counsel and found to be a valid exercise of the agency's legal authority.
Filed with the Office of
the Secretary of State on May 25, 2004.
TRD-200403562
Cynthia de Roch
General Counsel
Texas Building and Procurement Commission
Effective date: June 14, 2004
Proposal publication date: March 12, 2004
For further information, please call: (512) 463-4257
Part 5.
TEXAS BUILDING AND PROCUREMENT COMMISSION
Chapter 113.
PROCUREMENT DIVISION