TITLE 1.ADMINISTRATION

Part 4. OFFICE OF THE SECRETARY OF STATE

Chapter 81. ELECTIONS

Subchapter C. VOTING SYSTEMS

1 TAC §81.55

The Office of the Secretary of State, Elections Division, proposes a new rule, §81.55, concerning guidelines for political subdivisions to adopt electronic voting systems with practical and effective means of providing secret ballots to persons with physical disabilities as required under §122.0011 of the Texas Election Code.

Ann McGeehan, Director of Elections, has determined that for the first five-year period that this rule is in effect, there will be no fiscal implications to the state or local governments as a result of enforcing or administering the rule.

Ms. McGeehan has also determined that for each year of the first five years that the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to ensure that voting systems are accessible and that disabled voters have the ability to cast a secret ballot in jurisdictions using a newly adopted electronic voting system. There will be no effect on small businesses. There are no anticipated economic costs to persons who are required to comply with the rule as proposed.

Comments on the proposal may be submitted to Ann McGeehan, Director of Elections, Office of the Secretary of State, P.O. Box 12060, Austin, Texas 78711-2060.

The rule is proposed under Texas Election Code, Chapter 31, Subchapter A, §31.003, which authorizes the Office of the Secretary of State to promulgate rules to obtain uniformity in the interpretation and application of the Code, and Chapter 122, §122.0011 of the Code, which requires voting systems adopted after September 1, 1999, to provide practical and effective means of providing secret ballots to persons with physical disabilities.

Texas Election Code, Chapter 122, §122.0011 is affected by this proposed rule.

§81.55.Adoption of Accessible Voting Systems under §122.0011 of the Texas Election Code.

Adoption of Accessible Voting System after September 1, 1999.

(1)

The requirement of §122.0011 of the Texas Election Code (the "Code") to implement a practical and effective means of providing a secret ballot to persons with physical disabilities is triggered when a political subdivision acquires a new voting system by lease or purchase after September 1, 1999.

(2)

Only the acquisition of a new voting system (or substantial modification of an existing voting system) that will change voters' interaction with the ballot at the polling sites triggers §122.0011 of the Code. Any change made to a central counting station unit that does not directly affect voters does not trigger the law.

(3)

If a political subdivision acquires a new voting system, the system must be accessible to persons with physical disabilities and provide the voter with a practical and effective means to cast a secret ballot.

(4)

A political subdivision may use more than one type of voting system in a single polling place for the limited purpose of providing a person with physical disabilities with an alternative method of casting a secret ballot.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 31, 2000.

TRD-200003854

Jeff Eubank

Assistant Secretary of State

Office of the Secretary of State

Earliest possible date of adoption: July 09, 2000

For further information, please call: (512) 463-5701


1 TAC §81.56

The Office of the Secretary of State, Elections Division, proposes a new rule, §81.56, concerning alternative methods of providing secret ballots to persons with physical disabilities as required under §122.0011 of the Texas Election Code.

Ann McGeehan, Director of Elections, has determined that for the first five-year period that this rule is in effect, there will be no fiscal implications for state government as a result of enforcing or administering the rule; however, there may be fiscal implications for local governments due to an increase in costs for conducting elections should they choose to adopt any of the alternative methods of voting described below.

Ms. McGeehan has determined also that for each year of the first five years that the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be to ensure that jurisdictions using a newly adopted electronic voting system have guidelines for adopting alternative methods for providing a secret ballot to voters with physical disabilities. There will be no effect on small businesses. There are no anticipated economic costs to persons who are required to comply with the rule as proposed.

Comments on the proposal may be submitted to Ann McGeehan, Director of Elections, Office of the Secretary of State, P.O. Box 12060, Austin, Texas 78711-2060.

The rule is proposed under Texas Election Code, Chapter 31, Subchapter A, §31.003, which authorizes the Office of the Secretary of State to promulgate rules to obtain uniformity in the interpretation and application of the Code, and under Chapter 122, §122.0011 of the Code, which requires voting systems adopted after September 1, 1999, to provide practical and effective means of providing secret ballots to persons with physical disabilities.

Texas Election Code, Chapter 122, §122.0011 is affected by this proposed rule.

§81.56.Authorized Alternative Methods of Providing a Secret Ballot to Persons with Physical Disabilities.

The methods of providing a secret ballot to persons with physical disabilities are approved by the Office of the Secretary of State. Minor variations on these methods may be made without submitting the method to this office for approval. These methods supplement the regular voter-assistance procedures in Texas Election Code §§64.031-64.037.

(1)

Master Ballot with Telephone System for Regular Paper or Optical Scan Ballots

(A)

The political subdivision prints a set of regular paper or optical scan ballots specifically for use by visually or reading-impaired voters. Each race is listed on the ballot only by number (race 1, race 2, etc.), and each candidate is represented only by a number and letter (1a, 1b, 1c, 1d, 2a, 2b, etc.). The ballot is not precinct-specific, but rather has all possible races on which any voter anywhere in the political subdivision could vote. This is the "master ballot."

(B)

When a voter with a visual or reading disability arrives at the polling site and requests to vote under this method, the election official must verify the voter's eligibility to vote in the usual manner. The official then makes a telephone call to a designated telephone number. A person assigned to read the ballot in English or Spanish (the "reader") to the voter answers the telephone. The reader must have all ballot styles available to read, with each race marked by the race name (e.g., Governor) and the candidate's name (e.g., John Doe), as well as the assigned race and candidate numbers (e.g., race 1, candidate 1a). The voter selects a master ballot, and the election official must then write the precinct number on the ballot. The election official tells the reader the precinct number only; the official does not tell the reader the name of the voter. The election official hands the voter the telephone. Someone must assist the voter in marking the ballot. The voter must be assisted by two election officials if voting on election day, or assisted by one election official if voting during the early voting period, unless the voter prefers to be assisted by one person of the voter's own choosing who is not an election official. The reader reads the race, candidate names or propositions, and corresponding numbers to the voter. The voter then tells the assistant the number of the candidate of his or her choice, and the assistant marks the master ballot accordingly. Any declared write-in candidates also must be assigned a specific number and letter, which the reader will read if the voter wishes to vote for a write-in candidate. The voter will inform the assistant of the number of the write-in candidate, which the assistant will then write on the appropriate write-in line. The assistant also should fill-in the bubble (oval, square, or arrow) to show that the voter has selected a write-in candidate, if using an optical scan ballot. This will allow the voter to choose a write-in candidate without informing the assistant of the name of the person for whom the voter is voting. When the voter has completed the ballot, the voter or the assistant deposits it into the ballot box, and the telephone is returned to the election official.

(C)

This alternative method may be used with a pre-recorded audiotape for each ballot style, rather than with a telephone. The voter listens to the tape rather than a reader and informs the assistant of his or her choices.

(D)

At the early voting ballot board meeting or at the central counting station, as appropriate for early voting or election day, the master ballot is duplicated onto the correct ballot stock for that precinct. The serial number of the precinct ballot must be written on the master ballot so that the ballots can be matched up in the event of a recount and for auditing purposes.

(E)

This method should be used only in an election in which there are several races, each with several candidates, as this increases the likelihood that the voter's choices are secret.

(F)

This method will not allow a voter to vote secretly for an undeclared write-in candidate.

(G)

The use of a master ballot system is not authorized for use with a Precinct Ballot Counter system, as the master ballots must be duplicated onto the regular precinct ballot stock before tabulation may occur. However, if a political subdivision chooses to make precinct-specific blank ballots, listing only the races and candidates on which each precinct is eligible to vote so that the ballots would not have to be remade, then this system could be used with a Precinct Ballot Counter system.

(H)

Using a master ballot does not violate §52.005 of the Code, which states that the ballot for an election precinct may contain only those offices and propositions on which the qualified voters of the precinct are entitled to vote. The reader will read from a ballot specifically for the disabled voter's precinct and will not read to the voter any offices or propositions on which the voter is not entitled to vote. Thus the voter will not be able to vote on any offices or propositions on which the voter is not entitled to vote.

(I)

The use of a "scrambled" master ballot (also referred to as a "rotating" ballot), on which the races or candidates, or both, are listed in a different order from that on the regular ballot stock is expressly prohibited.

(J)

Election officials must situate the voting booths in a manner that will ensure as much privacy and as little noise for voters as possible.

(2)

Paper or Optical Scan Ballot with Template/Overlay and Telephone or Audiotape System

(A)

The political subdivision creates a precinct-specific tactile ballot cover or overlay ("template") that is used to allow visually or reading-impaired voters to vote independently through the use of touch. The ballot template is in the form of a folder or other overlay into which the voter's ballot is inserted, and a binder clip or similar fastener should be attached to keep the ballot in place. The ballot template has raised lines to guide a voter to the appropriate voting locations on the ballot, and has holes punched to allow the voter to mark the actual ballot. The lines may be created with velcro strips, fabric glue, caulk, or some other substance that will provide tactile guidance to the ballot layout. The lines should be designed to divide the races or issues on the ballot; each race or issue may be numbered by writing a number with the template-marking substance. The numbers may also be printed in Braille. If a vendor provides a ballot template with holes punched to correspond to every oval on an optical scan ballot, the authority conducting the election must make that template precinct-specific by dividing the ballot into the appropriate precinct races by using raised lines and covering the holes so that the voter may not make a mark. The material used to cover the holes must be self-adhesive and thick enough to alert the voter that a mark should not be made in that hole.

(B)

When a voter with a visual or reading disability arrives at the polling site and requests to vote using this method, the election official must verify the voter's eligibility to vote; and the voter selects a ballot from the official precinct ballot stock. The election official then inserts the ballot into the template and hands it to the voter. One corner of the ballot template must be cut at an angle that corresponds to a similar cut on the ballot. This will allow the official and the voter to be sure that the ballot is correctly aligned and facing the right way in the ballot cover. The voter may choose to insert the ballot into the ballot cover rather than having the election official perform this task.

(C)

If using the telephone system, the election official then makes a telephone call to a designated telephone number. A person assigned to read the ballot in English or Spanish (the "reader") to the voter answers the telephone. The election official tells the reader the precinct number only; the official does not tell the reader the name of the voter. The election official hands the voter the telephone. The reader instructs the voter how to read the ballot template to understand how it will allow him or her to mark his or her own ballot. Once the reader is sure the voter understands the procedures and the layout of the ballot template, the reader reads the first race and candidate names or propositions. The voter then marks the ballot through the hole in the ballot template corresponding to the candidate for which the voter wishes to vote (or for or against the proposition). The reader then instructs the voter to move to the next section on the ballot template to vote on the next race or issue. The reader must have a copy of the template that the voter is using so that the reader is sure to instruct the voter accurately on the proper races and candidates on which the voter is eligible to vote. The reader does not need an actual template; a carbon copy is sufficient. Once the voter has completed the ballot, the ballot is deposited in the ballot box, and the ballot cover is returned to the election official.

(D)

If an audiotape system is used, the precinct election official hands the voter the appropriate audiotape, audiotape player, and a set of headphones. The voter listens to the tape to receive instructions on how to read the ballot template to understand how to mark the ballot. If the voter does not understand the instructions, the voter may call the election official over to explain the template procedures. Once the voter understands the procedures and the layout of the ballot template, the voter continues playing the audiotape. The voter may stop the audiotape as necessary while marking the ballot through the hole in the ballot template corresponding to the candidate for which the voter wishes to vote (or for or against the proposition). The voter then restarts the tape and moves down or across the ballot, as instructed on the tape, to vote on the next race or issue. When the voter has completed the ballot, the ballot is deposited in the ballot box, and the ballot cover, audiotape, audiotape player, and headphones are returned to the election official.

(E)

Telephones used with this alternative method should be equipped with headsets rather than handsets. This will allow the voters to have their hands free to hold their ballot and template steady, and accurately mark the ballot through the template.

(F)

This alternative method does not enable the voter with a physical disability to vote for a write-in candidate without assistance.

(G)

Election officials must situate the voting booths in a manner that will ensure as much privacy and as little noise for voters as possible.

(3)

Punch Card or Lever Machine with Audiotape or Telephone System

(A)

Punch card and lever machine systems work similarly to the ballot template/overlay system, as the machines used allow visually or reading-impaired voters to vote using their sense of touch to guide them through the ballot. These systems may use either a telephone or audiotape to inform the voters of the procedures and the ballot contents.

(B)

If using the telephone system, the election official makes a telephone call to a designated telephone number. A person assigned to read the ballot in English or Spanish (the "reader") to the voter answers the telephone. The election official tells the reader the precinct number only; the official does not tell the reader the name of the voter. The election official hands the voter the telephone. The reader instructs the voter on the procedures for voting with a punch card or lever machine, as applicable. Once the reader is sure the voter understands the procedures, the reader reads the first race and candidate names or proposition. The voter votes, and the reader then instructs the voter to move to the next section on the ballot to vote on the next race or issue. When the voter has cast the ballot, the voter returns the telephone to the election official.

(C)

If an audiotape system is used, the precinct election official hands the voter the appropriate audiotape, audiotape player, and a set of headphones. The voter listens to the audiotape to receive instructions on how to vote with the punch card or lever machine. If the voter does not understand the instructions, the voter may call the election official over to explain the procedure. Once the voter understands the procedures, the voter continues playing the audiotape. The voter may stop the audiotape as necessary while marking the ballot. The voter then restarts the tape to vote on the next race or issue. When the voter has cast the ballot, the audiotape, audiotape player, and headphones are returned to the election official.

(D)

Telephones used with this alternative method should be equipped with headsets rather than handsets. This will allow the voters to have their hands free to mark their ballots.

(E)

Election officials must situate the voting booths in a manner that will ensure as much privacy and as little noise for voters as possible.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 31, 2000.

TRD-200003853

Jeff Eubank

Assistant Secretary of State

Office of the Secretary of State

Earliest possible date of adoption: July 09, 2000

For further information, please call: (512) 463-5701


1 TAC §81.57

The Office of the Secretary of State, Elections Division, proposes a new rule, §81.57, to establish criteria to assist this office in determining the accessibility of voting systems to enable political subdivisions to adopt electronic voting systems with practical and effective means of providing secret ballots to persons with physical disabilities as required under §122.0011 of the Texas Election Code.

Ann McGeehan, Director of Elections, has determined that for the first five-year period that this rule is in effect, there will be no fiscal implications to the state or local governments as a result of enforcing or administering the rule.

Ms. McGeehan has also determined that for each year of the first five years that the rule is in effect, the public benefit anticipated as a result of enforcing the rule will be that voting systems are accessible and that disabled voters will have the ability to cast a secret ballot in jurisdictions using a newly adopted electronic voting system. There will be no effect on small businesses. There are no anticipated economic costs to persons who are required to comply with the rule as proposed.

Comments on the proposal may be submitted to Ann McGeehan, Director of Elections, Office of the Secretary of State, P.O. Box 12060, Austin, Texas 78711-2060.

The rule is proposed under Texas Election Code, Chapter 31, Subchapter A, §31.003, which authorizes the Office of the Secretary of State to promulgate rules to obtain uniformity in the interpretation and application of the Code, and Chapter 122, §122.0011 of the Code, which requires voting systems adopted after September 1, 1999, to provide practical and effective means of providing secret ballots to persons with physical disabilities.

Texas Election Code, Chapter 122, §122.0011 is affected by this proposed rule.

§81.57. Requirements for Voting System Accessibility.

A voting system shall be accessible to voters with physical disabilities including no vision, low vision (visual acuity between 20/70 and 20/200, and/or 30 degree or greater visual-field loss), no hearing, low hearing, limited manual dexterity, limited reach, limited strength, no mobility, low mobility, or any combination of the foregoing, by providing voters with physical disabilities with a practical and effective means to cast an independent and secret ballot in accordance with each of the following, assessed independently and collectively:

(1)

The voting system shall provide a tactile-input or speech-input device, or both; and

(2)

The voting system shall provide a method by which voters can confirm any tactile or audio input by having the capability of audio output using synthetic or recorded human speech, which is reasonably phonetically accurate; and

(3)

The voting system shall provide a means for a voter to change the voter's selection prior to the voter casting the ballot; and

(4)

Any operable controls on the input device that are needed for voters without vision shall be discernable tactilely without actuating the keys. (Note: All the buttons on the device would not have to be discernable tactilely, only those buttons that are actually required for the individual to use the "operation without vision" mode.); and

(5)

Any audio and non-audio access approaches shall be able to work both separately and simultaneously; and

(6)

If a non-audio access approach is provided, the system shall not require color perception; the system shall use black text or graphics, or both, on white background or white text or graphics, or both, on black background, unless the office of the Secretary of State approves other high-contrast color combinations that do not require color perception; and

(7)

Any voting system that requires any visual perception shall offer the election official who programs the system, prior to its being sent to the polling place, the capability to set the font size to a level that can be read by voters with low vision. (Note: Although there is no standard font size for this situation, a san-serif font of 18 points as printed on a standard 8.5 x 11 piece of paper will allow the most universal access.); and

(8)

The voting system shall provide audio information, including any audio output using synthetic or recorded human speech or any auditory feedback tones that are important for the use of the audio approach, through at least one mode (e.g., by handset or headset) in enhanced auditory fashion (i.e., increased amplification), and shall provide incremental volume control with output amplification up to a level of at least 97 dB SPL, with at least one intermediate step of 89 dB SPL; and

(9)

For transmitted voice signals, the voting system shall provide a gain adjustable up to a minimum of 20 dB with at least one intermediate step of 12 dB of gain; and

(10)

For the safety of others, if the voting system has the possibility of exceeding 120 dB SPL, then a mechanism shall be included to reset the volume automatically to a safe level after every use (e.g., when handset is replaced) but not before; and

(11)

If sound cues and audible information, such as "beeps" are used, there shall be simultaneous corresponding visual cues and information; and

(12)

Any spoken text shall also be presented on screen, with the exception that any auditory confirmation of a voter's selection as required by Section 2 of this rule shall not be printed in text on the screen (Note: A graphic representation of a ballot with a check, "X," etc. beside a candidate or proposition is allowed.); and

(13)

All controls and operable mechanisms shall be operable with one hand, including with a closed fist, and operable without tight grasping, pinching, or twisting of the wrist; and

(14)

The force required to operate or activate the controls shall be no greater than 5 lbf (pounds per square foot); and

(15)

If a forward approach by a person in a wheelchair to a voting system is necessary, the maximum high-forward reach allowed shall be 48 inches (1220 mm) and the minimum low-forward reach shall be 15 inches (380 mm). If the high-forward reach is over an obstruction, reach and clearances shall be as shown in Figure 1 or otherwise in accordance with the ADAAG, as written at the time the system is certified for use in the state of Texas; and

Figure: 1 TAC §81.57(15)

(16)

If a side or parallel approach by a person in a wheelchair to a voting system is necessary, the maximum side reach allowed shall be 54 inches (1370 mm) and the low side reach shall be no less than 9 inches (230 mm) above the floor. If the side reach is over an obstruction, reach and clearances shall be as shown in Figure 2 or otherwise in accordance with the ADAAG, as written at the time the system is certified for use in the state of Texas; and

Figure: 1 TAC §81.57(16)

(17)

The highest operable part of controls, dispensers, receptacles, and other operable equipment shall be placed within at least one of the reach ranges outlined in Sections 15 and 16 of this rule.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 31, 2000.

TRD-200003852

Jeff Eubank

Assistant Secretary of State

Office of the Secretary of State

Earliest possible date of adoption: July 09, 2000

For further information, please call: (512) 463-5701


Part 5. GENERAL SERVICES COMMISSION

Chapter 113. CENTRAL PURCHASING DIVISION

The General Services Commission proposes amendments to Chapter 113, Subchapter A - Purchasing, §§113.2 - 113.6, §§113.8 - 113.14, and §§113.18 - 113.20; Subchapter C - Specification, §§113.33 and 113.34; Subchapter D - Inspection, §§113.51, 113.52 and 113.56; Subchapter E - Cooperative Purchasing Program, §§113.85 and 113.87; and Subchapter G - Buying Under a Contract Established by an Agency Other than the General Services Commission, §113.125. The amendments concern the Central Purchasing Division and are being proposed as a result of the rule review process mandated by Texas Government Code, §2001.039 (relating to Agency Review of Existing Rules). The proposed amendments will clarify language and streamline procedures.

Mr. Paul Schlimpter, Director of Central Procurement, has determined for the first five year period the rules are in effect, there will be no adverse effect to state or local government as a result of enforcing these rules.

Mr. Paul Schlimper, Director of Central Procurement, further determines that for each year of the first five-year period the amendments are in effect, the public benefit anticipated as a result of enforcing these rules will be deletion of obsolete language, updated statutory cites referenced within the rules, and clarified language. There will be no effect on small or large businesses and/or persons.

Comments on the proposals may be submitted to Ann Dillon, General Counsel, General Services Commission, P.O. Box 13047, Austin, TX 78711-3047. Comments must be received no later than thirty days from the date of publication of the proposal to the Texas Register.

Subchapter A. PURCHASING

1 TAC §§113.2 - 113.6, 113.8 - 113.14, 113.18 - 113.20

The amendments are proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155.068, 2155.077, 2155.079, 2155.080, 2155.081, 2155.132, 2155.134, 2155.267, 2155.323 2156.126, and 2251.003; Texas Government Code, Chapter 2158; and Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, Texas Government Code, Chapter 2251, and Education Code, Chapter 34, Subchapter A.

§113.2.Definitions.

The following words and terms, when used in this title, shall have the following meanings, unless the context clearly indicates otherwise.

(1)

Adopted uniform standards and specifications - Specifications and standards developed by nationally recognized standards-making associations that are evaluated and adopted by the specifications and standards program.

(2)

Advisory groups - A group that advises and assists the standards and specification program in establishing specifications. The advisory group may include representatives from federal, state and local governments, user groups, manufacturers, vendors and distributors, bidders, associations, colleges, universities, testing laboratories and others with expertise and specialization in particular product area.

(3)

[ (1) ] Agency -- A [ The chief executive officer of a ] state agency as the term [ "state agency" ] is defined under the Texas Government Code, Title 10, §2151.002.

(4)

Agent of record - An employee or official designated by a qualified cooperative entity as the individual responsible to represent the qualified entity in all matters relating to the program.

(5)

Approved products list - The list is also referred to as the approved brands list or qualified products list. It is a specification developed by evaluation brands and models of various manufacturers and listing those determined to be acceptable to meet the minimum level of quality. Testing is completed in advance of procurement to determine which products comply with the specifications and standards requirements.

(6)

[ (2) ] Award--The act of accepting a bid, thereby forming a contract between the state and a bidder.

(7)

[ (3) ] Bid--An offer to contract with the state, submitted in response to a bid invitation issued by the commission.

(8)

[ (4) ] Bid deposit - A deposit required of bidders to protect the state in the event a low bidder attempts to withdraw its bid or otherwise fails to enter into a contract with the state. Acceptable forms of bid deposits are limited to: cashier's check, certified check, or irrevocable letter of credit issued by a financial institution subject to the laws of Texas and entered on the United States Department of the Treasury's listing of approved sureties; a surety or blanket bond from a company chartered or authorized to do business in Texas [ ; United States treasury bond; or certificate of deposit ].

(9)

[ (5) ] Bid sample--A sample required to be furnished as part of a bid, for evaluating the quality of the product offered.

(10)

[ (6) ] Bidder--An individual or entity that submits a bid. The term includes anyone acting on behalf of the individual or other entity that submits a bid, such as agents, employees, and representatives.

[ (7)

Bidders List-The centralized master bidders list. ]

(11)

[ (8) ] Blanket bond--A surety [ performance ] bond which provides assurance of [ insures ] a bidder's performance on two or more contracts in lieu of separate bonds for each contract. The amount for a blanket bond shall be established by the commission based on the bidder's annual level of participation in the state purchasing program. [ Acceptable forms of blanket bonds are those described in the definition of "bid deposit." ]

(12)

Board - The governing body of a county or local school district.

(13)

[ (9) ] Brand name--A trade name or product name which identifies a product as having been made by a particular manufacturer.

(14)

[ (10) ] Centralized master bidders list (CMBL) --A list maintained by the commission containing the names and addresses of prospective bidders and qualified information systems vendors.

(15)

[ (11) ] Consumable procurement budget--That portion of an agency's budget as identified by the comptroller's expenditure codes attributable to consumable supplies, materials, and equipment.

(16)

Cooperative purchasing program - A program to provide purchasing services to qualified cooperative entities, as defined herein.

(17)

Debarment - An exclusion from contracting or subcontracting with state agencies on the basis of any cause set forth in §113.102 of this title (relating to Vendor Performance and Debarment), commensurate with the seriousness of the offense, performance failure, or inadequacy to perform.

(18)

[ (12) ] Director--The director of the commission's purchasing division.

(19)

Distributor purchase - purchase of repair parts for a unit of major equipment that are needed immediately or as maintenance contracts for laboratory/medical equipment.

(20)

[ (13) ] Emergency purchase--A purchase of goods or services so badly needed that an agency will suffer financial or operational damage unless the purchase is conducted [ they are secured ] immediately.

(21)

[ (14) ] Environmentally sensitive products--Products that protect or enhance the environment, or that damage the environment less than traditionally available products.

(22)

[ (15) ] Equivalent product--A product that is comparable in performance and quality to the specified product.

(23)

[ (16) ] Escalation clause--A clause in a bid providing for a price increase under certain specified circumstances.

(24)

[ (17) ] Formal bid--A written bid submitted in a sealed envelope in accordance with a prescribed format, or an electronic data interchange transmitted to the commission in accordance with procedures established by the commission.

(25)

[ (18) ] Group purchasing program--A purchasing program that offers discount prices to two or more state agencies or institutions of higher education , which is formed as a result of interagency or interlocal cooperation and follows all applicable statutory standards for purchases .

(26)

[ (19) ] Informal bid--An unsealed, competitive bid submitted by letter, telephone, telegram, or other means.

(27)

[ (20) ] Invitation for bids (or IFB)--A written request for submission of a bid; also referred to as a bid invitation.

(28)

[ (21) ] Late bid--A bid that is received at the place designated in the bid invitation after the time set for bid opening.

(29)

Level of quality - The ranking of an item, article, or product in regard to its properties, performance, and purity.

(30)

[ (22) ] List of approved equipment--A list of items available under term contracts for purchase by school districts through the commission pursuant to the Texas Education Code, §21.901.

(31)

[ (23) ] Manufacturer's price list--A price list published in some form by the manufacturer and available to and recognized by the trade. The term does not include a price list prepared especially for a given bid.

(32)

[ (24) ] Multiple award contract procedure--A purchasing procedure by which the commission establishes one or more levels of quality and performance and makes more than one award at each level.

(33)

Non-competitive purchase -- A purchase of goods or services (also referred to as "spot purchase") that does not exceed the amount stated in §113.11 (c) (1) of this title (relating to Delegated Purchases).

(34)

[ (25) ] Notice of award--A letter signed by the director or his designee which awards and creates a term contract.

(35)

[ (26) ] Open market purchase--A purchase of goods, usually of a specified quantity, made by buying from any available source in response to an open market requisition.

(36)

Performance bond - A surety bond which provides assurance of a bidder's performance of a certain contract. The amount for the performance bond shall be based on the bidder's annual level of potential monetary volume in the state purchasing program. Acceptable forms of bonds are those described in the definition for "bid deposit".

(37)

[ (27) ] Perishable goods--Goods that are subject to spoilage within a relatively short time and that may be purchased by agencies under delegated authority.

(38)

[ (28) ] Post-consumer materials--Finished products, packages, or materials generated by a business entity or consumer that have served their intended end uses, and that have been recovered or otherwise diverted from the waste stream for the purpose of recycling.

(39)

[ (29) ] Pre-consumer materials--Materials or by-products that have not reached a business entity or consumer for an intended end use, including industrial scrap material, and overstock or obsolete inventories from distributors, wholesalers, and other companies. The term does not include materials and by-products generated from, and commonly reused within, an original manufacturing process or separate operation within the same or a parent company.

(40)

Product specification - A concise statement of a set of requirements to be satisfied by a product or material, indicating whenever appropriate the procedures to determine whether the requirements are satisfied.

(41)

[ (30) ] Proprietary--Products or services manufactured or offered under exclusive rights of ownership, including rights under patent, copyright, or trade secret law. A product or service is proprietary if it has a distinctive feature or characteristic which is not shared or provided by competing or similar products or services.

(42)

[ (31) ] Public bid opening--The opening of bids at the time and place advertised in the bid invitation, in the presence of anyone who wishes to attend. On request of any person in attendance, bids will be read aloud.

(43)

[ (32) ] Purchase orders--

(A)

Open market purchase order--A document issued by the commission to accept a bid, creating an open market purchase contract.

(B)

Automated contract [ Contract ] purchase order--A release order issued by the commission under an existing term contract, and pursuant to a requisition from a qualified ordering entity [ an agency ].

(C)

Non-automated purchase order - A release order issued by an agency as a non-automated term contract, and pursuant to a requisition by the qualified ordering entity.

(44)

[ (33) ] Purchasing functions--The development of specifications, receipt and processing of requisitions, review of specifications, advertising for bids, bid evaluation, award of contracts, and inspection of merchandise received. The term does not include invoice, audit, or contract administration functions.

(45)

Qualified information systems vendor catalogue proposal - A request for offers or quotations of prices from catalogue vendors (QISV).

(46)

Qualified cooperative entity - An entity that qualifies for participation in the cooperative purchasing program:

(A)

A county, municipality, school district, special district, junior college district, or other legally constituted political subdivision of the state that is a local government.

(B)

Mental health and mental retardation community centers in Government Code, §2155.202, that receive grants-in-aid under the provisions of Subchapter B, Chapter 534, Health and Safety Code.

(C)

An assistance organization as defined in Government Code, §2175.001, that receive any state funds.

(D)

A political subdivision, under Chapter 791, Government Code.

(47)

Qualified Ordering Entity - A state agency as the term is defined under the Texas Government Code, Title 10, §2151.002, or an entity that qualifies for participation in the cooperative purchasing program as defined in Local Government Code, Subchapter D, §271.081.

(48)

[ (34) ] Recycled material content--The portion of a product made with recycled materials consisting of pre-consumer materials (waste), post-consumer materials (waste), or both.

(49)

[ (35) ] Recycled materials--Materials, goods, or products that contain recyclable material, industrial waste, or hazardous waste that may be used in place of raw or virgin materials in manufacturing a new product.

(50)

[ (36) ] Recycled product--A product that meets the requirements for recycled material content as prescribed by the rules established by the Texas Natural Resource Conservation Commission in consultation with the General Services Commission.

(51)

[ (37) ] Remanufactured product--A product that has been repaired, rebuilt, or otherwise restored to meet or exceed the original equipment manufacturer's (OEM) performance specifications; provided, however, the warranty period for a remanufactured product may differ from the OEM warranty period.

(52)

[ (38) ] Request for proposal--A written request for offers concerning goods or services the state intends to acquire by means of the competitive sealed proposal procedure.

(53)

[ (39) ] Requisition--

(A)

Open market purchase requisition--An initiating request from an agency describing needs and requesting the commission to purchase goods or services to satisfy those needs.

(B)

Term contract purchase requisition--A request from a qualified ordering entity [ an agency ] for delivery of goods under an existing term contract.

(54)

Responsible vendor - A vendor who has the capability to perform all contract requirements in full compliance with applicable state law, ethical standards, and applicable commission rules.

(55)

Resolution - Document of legal intent adopted by the governing body of a qualified cooperative entity that evidences the qualified cooperative entity's participation in the cooperative purchasing program.

(56)

[ (40) ] Scheduled purchase--A purchase with a prescheduled bid opening date, allowing the commission to combine orders for goods.

(57)

[ (41) ] Sealed bid--A formal written bid.

(58)

[ (42) ] Solicitation--An invitation for bids or a request for proposals.

(59)

[ (43) ] Standard specification [ Specification ]--A description of what the purchaser requires and what a bidder or proposer must offer.

[(44)

Spot purchase--A purchase of goods or services that does not exceed the amount stated in §113.11 of this title (relating to Delegated Purchases).]

(60)

Successor -in -interest - Any business entity that has ownership similar to a business entity. For purposes of §113.102 of this title (relating to Vendor Performance and Debarment), it shall be presumed that a business entity that employs, or is associated with, any partner, member, officer, director, responsible managing officer, or responsible managing employee, of a business entity that was previously debarred is a successor-in-interest.

(61)

[ (45) ] Tabulation of bids--The recording of bids and bidding data for purposes of bid evaluation and recordkeeping.

(62)

[ (46) ] Term contract purchase--A purchase by a qualified ordering entity [ an agency ] under a term contract, which established a source of supply for particular goods at a given price for a specified period of time.

(63)

Testing - an element of inspection involving the determination, by technical means, of the properties or elements of item (s) or component (s), including function operation.

(64)

Texas uniform standards and specification - Standards and specifications prepared and published by the standards and specifications program of the commission.

(65)

[ (47) ] Total expenditures on products with recycled material content, remanufactured products, and environmentally sensitive products--The total direct acquisition costs (vendor selling price plus delivery costs) of all such products.

(66)

[ (48) ] Unit price--The price of a selected unit of a good or service, e.g., price per ton, per labor hour, or per foot.

(67)

[ (49) ] Using agency--An agency of government that requisitions goods or services through the commission.

(68)

[ (50) ] Vendor--A supplier of goods or services to the state.

[ (51)

Written data--Data which is expressly required to be submitted in writing. A bid invitation that expressly requires the submission of written data with the bid must include the following statement or its substantial equivalent: "Failure to provide the required information with the bid response will automatically disqualify the bid from consideration for award in connection with this transaction." ]

§113.3.Requisitions and Specifications; Proprietary Purchases; Lease Purchases.

(a)

Requisitions.

(1)

A purchase is initiated by an agency's submission of a requisition containing desired specifications and conditions of the purchase on a form provided or approved by the commission. The requisition must also include the agency's certification that funds are available for the purchase.

(2)

Requisitions shall [ should ] be submitted to the commission far enough in advance to allow sufficient time for preparing and advertising bid invitations, receiving and evaluating bids, awarding contracts, and permitting a normal delivery schedule.

(3)

The agency is responsible for determining its need for a purchase, and the commission will not question the agency's determination of need. However, the commission may require clarification of the specifications to foster open competition. If the agency's specifications unreasonably limit competition, [ however, ] the commission may require an additional written explanation [ justification ].

(b)

Specifications.

(1)

The commission develops standard specifications for a number of commodities purchased by the state and provides agencies with a list of the commodities covered by the standard specifications. If an agency submits a requisition with non-standard specifications when an applicable standard specification exists, it must include an explanation as to why the standard specification is not being used.

(2)

If an agency submits a requisition for the purchase of a product on the open market when an equivalent product is available for purchase under a term contract, it must include an acceptable explanation as to why the contract product is not satisfactory.

(3)

The commission will review the specifications and conditions of purchase submitted by an agency. The commission will not significantly change specifications or conditions of purchase without written approval from the agency, but it may correct typographical errors if doing so will not significantly change the specifications. Incorrect, inadequate, or incomplete requisitions may be returned to the agency, with a written explanation for the return and the requirements for acceptable re-submission .

(4)

The commission will normally specify delivery times that are standard in the industry. If an agency requires shorter than standard delivery times, it must state the requirement in its requisition. If the delivery requirement can only be met by one vendor, written justification will be required. If an agency does not require early delivery but wishes to take advantage of it if available, the commission will state in the bid invitation that the ability to make early delivery may be a factor in making the award. In such cases, when it is to the state's advantage, the commission may accept a bid other than the lowest after consulting with the agency. If the bid invitation contains no statement regarding early delivery, the commission may not consider early delivery in making an award.

(c)

Proprietary purchases.

(1)

When the commission finds that an agency has submitted specifications or conditions of purchase which are proprietary to one vendor and do not permit an equivalent product to be supplied, it shall require written justification before processing the requisition. Within 10 days after the commission received the requisition, it will notify the agency of the need for a written justification. An agency may submit a written justification along with its requisition if it chooses to do so.

(2)

A written justification for the use of proprietary specifications or conditions must:

(A)

contain an explanation of the need for the specifications or conditions;

(B)

state the reasons why any competing or equivalent products identified by the commission are not satisfactory, addressing each such product individually;

(C)

contain any other information requested by the commission; and

(D)

be signed by the agency head, the chairman of its governing body, or a person to whom such signature authority has been properly delegated, or in the case of an institution of higher education [ learning ], by a person properly designated as a purchasing officer for the institution.

(3)

When an agency submits a written justification meeting the above requirements, the commission shall make the requested purchase. [ If, after considering all factors, the commission takes exception to the agency's written justification, it shall prepare a written report of the reasons for its exceptions. Copies of the report will be sent by certified mail, return receipt requested, to board members, commission members, the agency head or chairman of its governing body, and elected officials of the respective agency. Copies of the report will also be provided to the state auditor, the Legislative Budget Board, and the governor. ]

(4)

When the commission reviews specifications or conditions and finds that they limit competition but are not proprietary to one vendor, it shall not return the requisition to the agency for that reason alone. However, a commission purchaser shall discuss with the agency purchaser the limiting effect, and the possible economic effect, of the specification or condition.

(d)

Lease-purchase contracts.

(1)

An agency may acquire capital equipment by lease-purchase if it is cost effective.

(2)

If a proposed lease purchase is for information technologies resources, as defined in the Texas Government Code, Title 10, Suchapter A, Chapter 2054 [ Information Resources Management Act, Texas Civil Statutes, Article 4413(32j) ], the requisition must include written evidence that the Department of Information Resources [ (DIR) ] has approved the agency's biennial operating plan [ acquisition ]. For other items, the commission will determine the cost effectiveness of a lease purchase. To establish cost effectiveness, the requisitioning agency should submit the following information:

(A)

anticipated interest charges over the life of the contract;

(B)

anticipated cost savings which would result from outright purchase;

(C)

an affirmative statement that the agency reasonably expects to be able to make payments beyond the current biennium without requiring an increase in appropriations;

(D)

any information requested by the commission; and

(E)

any other information the agency considers relevant.

§113.4.Centralized Master Bidders List.

(a)

The commission maintains the Centralized Master Bidders List (CMBL) of the names and addresses of vendors which have applied and been accepted for inclusion on the CMBL. The CMBL is maintained for the state's use in obtaining competitive bids for purchases and for registering vendors who wish to be designated as qualified information systems vendors. No vendor will be placed on the CMBL to receive bid invitations for information purposes only. Bid invitations and requests for proposals are transmitted [ mailed ] to vendors on the CMBL for the solicited commodity and/or service for open market, term contracts, competitive sealed proposal acquisitions and delegated purchases in excess of the non-competitive bid limit. For all non-competitive purchases, the director shall establish minimum use requirements for delegated purchases. The entire CMBL listings under a particular class and item of purchases shall be used for procurements in excess of the delegated purchase amount [ below and above $15,000 made by the commission and state agencies/universities ].

(b)

To be considered for inclusion on the CMBL, a vendor must:

(1)

complete the application form provided by the commission which includes certification that the vendor has access to the class and item codes and is aware of the requirements and procedures regarding the provision of goods, services and other transactions with [ acquisitions to ] the state and its qualified ordering [ eligible ] entities;

(2)

remit a check or money order in the amount of $100, which is the biennial maintenance fee assessed to cover the commission's costs for maintaining the bidders list and transmission of [ mailing ] bids or proposals. This fee, less a reasonable handling fee approved by the director [ $15 for handling ], will be refunded if the applicant is not accepted for inclusion on the CMBL.

(c)

The commission will review and evaluate the CMBL application, and may reject an application that is not satisfactorily completed.

(d)

A vendor may be administratively removed from the CMBL for one or more of the following reasons:

(1)

failing to pay or unnecessarily delaying payment of damages assessed by the commission;

(2)

failing to submit bids in response to bid invitations on either:

(A)

four consecutive open market invitations concerning the affected class or item; or

(B)

one or more contract or schedule invitations concerning the affected class;

(3)

failing to remit the biennial CMBL maintenance fee; or

(4)

any factor set forth in Government Code, Chapter 2155, §§ 2155.070 and 2155.077.

(e)

A vendor which has been removed from the CMBL shall not be reinstated until expiration of the period for which the vendor was removed and approval is granted by the director [ commission's Director, Central Procurement Services ].

(f)

An error in addressing a bid invitation or request for proposal or a failure of the post office to deliver the solicitation will not be sufficient reason to require the commission to reject all other bids or proposals.

(g)

State agencies [ State agencies/universities ] shall use the CMBL to select bidders for competitive bids or proposals and to the fullest extent possible for purchases exempt from the commission's purchasing authority. This requirement does not apply to the Texas Department of Transportation or to an institution of higher education as defined by §61.003, Education Code, but an institution of higher education should use the CMBL when possible.

[ (h)

The commission may authorize an agency to maintain and use its own bidders lists for specialized needs only by approval of the commissioners in open meeting. Requests for such approval should be made in writing to the executive director and signed by the chief executive officer of the requesting agency. All such requests should clearly set out the reasons and justifications for the request. ]

§113.5.Bid Submission, Bid Opening, and Tabulation.

(a)

Bid submission.

(1)

Prospective bidders may request specific bid invitations from the commission at any time prior to the bid opening. [ A copy of the bid invitation will be handed or mailed to the requestor. ]

(2)

A bidder may withdraw its bid by written request at any time prior to the bid opening date and hour.

(3)

A bid received after the time and date established by the bid invitation is a late bid and will not be considered.

(4)

A bid received which does not contain adequate bid identification information on the outside of the envelope will be opened to obtain such information[ , ] and will then be processed as any other bid. If the incorrect information on the envelope causes the bid not to be considered in making an award, the bid will be considered invalid and rejected [ not acceptable ].

(5)

Bids may be submitted by telefacsimile (fax). The telephone number for fax bid submission will be identified in the solicitation; no other number may be used for bid submission. The commission's receipt of bids by fax is solely for the convenience of bidders and is permitted on a cost recovery basis, subject to change without notice. Bids submitted by fax need not be confirmed in writing, but must comply with all legal requirements applicable to formal bids. If all or any portion of a bid submitted by fax is received late, is illegible, or is otherwise rendered nonresponsive due to equipment failure or operator error, the bid or the applicable portion of the bid will not be considered. The commission shall not be liable for equipment failure or operator error, nor will such failure or error require other bids to be rejected or the bid invitation to be readvertised.

(6)

Bids by telegram are not allowed. [ Bids may be submitted by telegram, except for bids on non-automated discount-from-list term contracts, if the telegram identifies the merchandise offered and provides requisition number, price, delivery terms, and other necessary information. Telegrams must be confirmed in writing and either postmarked on or before the bid opening date or received by the commission within 48 hours after bid opening time. The confirmation must be consistent with the telegram and must be signed. An inconsistent or unsigned confirmation will void the entire bid. ]

(7)

An unsigned bid is not valid and will be disqualified.

(8)

A bidder or an agency may request, in person at the bid opening, that bids be read aloud. No bid shall be required to be read aloud at any time other than during regular working hours and days.

(9)

When formal bids are required, bids may not be taken or accepted by telephone.

[ (10)

Return mail bids do not have a bid opening date. ]

(10)

[ (11) ] If an error is discovered in a bid invitation, or agency requirements change prior to the opening of a bid, the commission will transmit [ mail ] an addendum correcting or changing the specifications to all bidders originally listed on the transmission [ mailing ] list for that bid invitation. Bids will not be rejected for failure to return the addendum with the bid, if the change is noted on the bid or the product or service specification [ bid ] would not be changed by the addendum.

(11)

[ (12) ] By signing and submitting a bid to the commission or to an agency acting under delegated purchasing authority, a bidder affirms that it has not given or offered any economic opportunity, employment, gift, loan, gratuity, special discount, trip, favor, or service to a public servant in connection with the bid, and that it does not intend to give or offer any of the foregoing in the future. Signing a bid with a false statement shall void the bid and any resulting contract, and the bidder shall be removed from all bidders lists at the commission or at the agency acting under delegated purchasing authority.

[ (13)

A bid submitted by a corporation must contain a certification that the corporation is not delinquent in its Texas franchise tax payments, or that it is exempt from, or not subject to, such tax. A false statement concerning the corporation's Texas franchise tax status constitutes grounds for cancellation of any resulting contract at the sole option of the state. ]

(b)

Bid opening and tabulation.

(1)

All bid openings conducted by the commission shall be open to the public.

(2)

Bid opening dates may be changed and bid openings rescheduled if bidders are properly notified in advance of the new opening date.

(3)

If a bid opening is canceled, all bids which are being held for opening will be returned to the bidders.

(4)

All bid tabulation files are available for public inspection. Bid tabulations may be reviewed by any interested person during regular working hours at the offices of the commission. Employees of the commission are not required to give bid tabulation information by telephone.

§113.6.Bid Evaluation and Award.

(a)

Bid evaluation.

(1)

The commission may accept or reject any bid or any part of a bid or waive minor technicalities in a bid, if doing so would be in the state's best interest.

(2)

A bid price may not be altered or amended after bids are opened except to correct mathematical errors in extension.

(3)

No increase in price will be considered after a bid is opened. A bidder may reduce its price provided it is the lowest and best bidder and is otherwise entitled to the award.

(4)

Bid prices are considered firm for acceptance for 30 days from the bid opening date for open market purchases [ purchase ] and 60 days for term contracts, unless otherwise specified in [ by the bidder or ] the invitation for bids.

(5)

A bid containing a self-evident error may be withdrawn by the bidder prior to an award.

(6)

Bid prices which are subject to unlimited escalation will not be considered. A bidder may offer a predetermined limit of escalation in his bid and the bid will be evaluated on the basis of the full amount of the escalation.

(7)

A bid containing a material failure to comply with the advertised specifications shall be rejected.

(8)

All bids must be based on "F.O.B. destination" delivery terms unless otherwise specified.

(9)

If requested in the invitation for bids, samples must be submitted or the bid will be rejected. The commission will require samples only when essential to the assessment of product quality during bid evaluation. Samples for non-winning bids shall [ should ] be returned to a bidder whenever practicable, at the bidder's expense. Otherwise, samples will be disposed of in the same manner as surplus or salvage property.

(10)

When brand names are specified, bids on alternate brands will be considered if they otherwise meet specification requirements.

(11)

Cash discounts are acceptable but are not considered in making an award. All cash discounts offered will be taken if they are earned by the agency.

(12)

No electrical item may be purchased unless the item meets applicable safety standards of the federal Occupational Safety and Health Administration (OSHA).

(b)

Award.

(1)

All awards shall be made to the bidder complying with the best value criteria used in the bid and [ submitting the lowest and best bid ] conforming to the advertised product or service specifications. In determining which bidder is offering the best value [ who is the lowest and best bidder ], in addition to price, the commission shall consider and evaluate the factors set out in Government Code, Title 10, Subtitle D, Subchapter A, §2156.007 and all other factors comprising the best value criteria as may be set forth in the bid [ Texas Civil Statutes, Article 60lb, §3.11(e) ].

(2)

An open market purchase contract is awarded and created when the director of purchasing or his designee authorizes [ signs ] an open market purchase order. A term contract is awarded and created when the director of purchasing or his designee signs a notice of award.

(3)

In case of tie bids which cannot be resolved by application of one or more preferences described in §113.8 of this title (relating to Preferences), an award shall be made by drawing lots.

§113.8.Preferences.

(a)

Claiming a preference. To claim a preference, a bidder shall mark the appropriate box on the face of the bid invitation. If the appropriate box is not marked, a preference will not be granted unless other documents included in the bid show a right to the preference.

(b)

Preferences.

(1)

Texas resident bidders.

(A)

A Texas resident bidder shall be given preference over a nonresident bidder when the cost, and quality of the goods or services are equal.

(B)

The commission may award a contract to a nonresident bidder only if its bid is lower than the lowest bid submitted by a responsible Texas resident bidder by the same amount that a Texas resident bidder would be required to underbid the nonresident bidder to obtain a comparable contract in the state where the nonresident's principal place of business is located. In evaluating a bid of a nonresident bidder, an amount will be added equal to the amount a Texas resident bidder would be required to underbid a nonresident bidder to obtain a comparable contract in the state where the nonresident bidder's principal place of business is located , otherwise known as reciprocal preference . After the amount is added, an award may be made to the nonresident bidder if it is determined to have the lowest price and best bid. The amount added is for evaluation purposes only; in no event shall an amount be awarded in excess of the amount actually bid.

(2)

Texas and United States products.

(A)

Supplies, materials, or equipment produced in Texas shall be given preference over comparable goods produced outside Texas when the cost and quality of the goods are equal. Supplies, materials, and equipment are considered to be produced in Texas if they are manufactured in Texas; "manufactured" does not include the work of packaging or repackaging.

(B)

Agricultural products grown in Texas shall be given preference over comparable products grown outside Texas when the cost and quality of the goods are equal. Agricultural products are considered grown in Texas if they contain any amount grown in Texas. In case of tie bids between agricultural products claiming the preference, the bidder whose product contains the greatest percentage of the product grown in Texas will prevail. For purposes of this preference, agricultural products include, among other things, textiles and fiber products, processed and unprocessed foods, feed, lumber and forestry products, live animals, plants, flowers, and nursery stock.

(C)

Supplies, materials, equipment, or agricultural products produced or grown in the United States shall be given preference over foreign products when the cost and quality are equal, if comparable goods of equal cost and quality produced or grown in Texas or offered by Texas bidders are not available.

[ (3)

Historically Underutilized Business. A preference shall be given to historically underutilized business (HUB) which are certified as HUBs by the commission when the cost and quality of goods or services are equal. ]

(3)

[ (4) ] Products of persons with mental or physical disabilities. A preference shall be given to manufactured products of workshops, organizations, or corporations whose primary purpose is training and employing persons with mental or physical disabilities, if the products meet state specifications as to quantity, quality, and price. Competitive bids are not required for purchases of blind-made goods or services offered as a result of efforts by the Texas Council on Purchasing from People with Disabilities, if the goods or services meet state specifications as to quantity, quality, price, delivery, life cycle costs, and costs no more than the fair market price of similar items.

(4)

[ (5) ] Recycled, remanufactured or environmentally sensitive products. A preference shall be given to recycled, remanufactured or environmentally sensitive products if the products meet state specifications as to quantity and quality and defined best value factors. [ and the bid price does not exceed the bid price of products that accomplish the same purpose as recycled, remanufactured or environmentally sensitive products. ]

(5)

[ (6) ] Energy efficient products. A preference shall be given to energy efficient products if they meet state requirements as to quantity and quality, and are equal to or less than the cost of other products offered. This preference shall be applied by evaluating the energy use of the products offered and considering the costs of such energy use over the expected life of the equipment. The methodology for evaluating energy use and costs shall be included in the bid invitation.

(6)

[ (7) ] Rubberized asphalt paving material. A preference shall be given to rubberized asphalt paving material made from scrap tires by a facility in this state if the cost, as determined by life-cycle cost benefit analysis, does not exceed the bid cost of alternative paving materials by more than 15%.

(7)

[ (8) ]Recycled motor oil and lubricants. A preference shall be given to motor oils and lubricants that contain at least 25% recycled oil if the quality is comparable and the cost is equal to or less than new oil and lubricants.

§113.9.Contract Administration.

(a)

Inspection of merchandise.

(1)

Qualified ordering entities [ Agencies ] must inspect all shipments received against orders and report any discrepancies to the commission immediately.

(2)

If unlisted shortages are discovered, the vendor and the commission must be notified immediately. Unless shipments are checked immediately upon arrival and such shortage reports are made within 15 days, the contractor cannot be held responsible for shortages.

(3)

A contractor may be required to pick up any merchandise not conforming to specifications and replace the merchandise immediately.

(b)

Substitutions. Substitution of items called for in a contract is not permitted without the commission's prior approval. No such approval will be granted unless substituted items are of equal quality and are offered at the same or lower price.

(c)

Cancellations.

(1)

Cancellations on orders issued by the commission , either on the part of the vendor or a qualified ordering entity [ an agency ], are not permitted without the commission's prior written approval.

(2)

Orders may be canceled without the contractor's consent due to unsatisfactory performance or nonperformance by the contractor.

(3)

Orders may not be canceled without first obtaining the consent of the contractor if the reason for cancellation is not the fault of the contractor.

(4)

A contract or a portion of a contract may be canceled on request of the contractor if the contractor is unable to perform due to circumstances beyond its control. In these instances, the commission will consider such requests when presented in writing with proper documentation.

[ (5)

The state may pay a restocking charge or other similar charge as a result of a canceled order, if the commission determines that the charge is justifiable under the circumstances. ]

(d)

Damages for failure to perform.

(1)

A vendor who fails to perform as required under a contract shall be liable for actual damages and costs incurred by the state.

(2)

If any merchandise delivered under a contract has been used or consumed by an agency and on testing is found not to comply with specifications, no payment may be approved by the commission for such merchandise until the amount of actual damages incurred has been determined.

(3)

A vendor who fails to pay damages assessed by the state may not be awarded additional contracts until such damages have been paid or the matter has been otherwise resolved.

(4)

The commission shall seek to collect damages by following the procedures established by the Office of the Attorney General for the collection of delinquent obligations.

§113.10.Term Contracts.

[ (a) ]

The commission enters into term contracts for the purchase or lease of items used in large quantities by several state agencies. The term of the contract is determined by the commission; usually, the term is 12 months.

(1)

Bid invitations.

(A)

The commission maintains records of the quantities and/or dollar volumes purchased under term contracts during the previous year and includes this information in bid invitations. Term contracts are established for estimated quantities only, however, and do not guarantee that the state will order any given amount during the contract period.

(B)

Term contracts may be either firm price or firm fixed price contracts with escalation and de-escalation [ discount-from-list contracts ].

(2)

Bidding instructions.

(A)

Firm fixed price contracts with escalation/de-escalation [ Discount-from-list contracts ] provide for discounts from (or add on to) a manufacturer's price list, which must be included in the bid file [ accompany the bid ]. Price changes are acceptable under specified [ approved ] conditions. Requests for price increases must be documented with a new price list from the manufacturer covering the items in question. New net unit prices will be computed at the same percentage as reflected in the original bid and price list. For automated contracts identified as such in the bid invitation, the commission may consider bids which fail to include a manufacturer's price list or include a price list that fails to meet other requirements of the bid invitation, and the commission may award a contract to a vendor submitting such a bid; however, if an award is made, the vendor will not be entitled to a price increase during the term of the contract. The state shall be granted any decreases in price if there are price reductions in the trade. Indices other than a manufacturers price list such as a consumer price index may also be used on the price basis.

[ (B)

Term contract awards for publications (commodity class 715) or approval programs are based on a quoted discount, but bidders are not required to furnish a price list with their bids, nor are they required to furnish a new price list in the event of price changes.]

[ (C)

Telegraphic bids are not acceptable for non-automated discount-from-list contracts identified as such in the bid invitation, because the necessary price lists are required to be in the commission's office prior to the bid opening date and hour.]

(B)

[ (D) ] When bids are solicited by [ A bidder may bid all ] zones of the state, as described in the general instructions to bidders accompanying the bid invitation, a bidder [ or it ] may bid one or more selected zones[ , ] but it must bid for an entire zone. Any exception that requires bidding the entire state will be stated in the invitation for bids.

(3)

Awards.

(A)

The commission will notify a successful bidder of the acceptance of its bid by issuing a notice of award. The successful bidder must review the notice of award and notify the General Services Commission in writing within 10 days of any error requiring correction.

(B)

Performance bonds may be required for each award exceeding $100,000.

(4)

Delivery requirements.

(A)

All items shipped by a vendor must be new (unless otherwise specified in a purchase document) and received by the agency in first-class condition within the specified time.

(B)

All merchandise shipped against the contract order during the term of the contract must be as the vendor originally quoted. If items become unavailable during the term of a contract, the commission may require the vendor to furnish acceptable substitutes.

[ (b)

Studies of statewide or regional services contracts. ]

[ (1)

The commission shall select and study at least one service annually to determine the benefit to the state of providing the service through statewide or regional contracts. The study will focus on the possible benefits from contracting on either a statewide or regional basis. If economic benefits may be realized from statewide or regional contracts, the commission shall use such contracts.]

[ (2)

If the commission determines that more than five bidders are willing to provide a specific service, a statewide or regional term contract is not mandatory. However, if the commission determines it is in the state's best interest, it may establish contracts with one or more vendors to provide the service. ]

§113.11.Delegated Purchases.

(a)

General delegation. The following purchasing functions are delegated to agencies:

(1)

commodity purchases of goods that do not exceed $25,000;

(2)

emergency purchases [ (purchases of goods or services so badly needed that an agency will suffer financial or operational damage unless they are secured immediately) ];

(3)

purchases of perishable items;

(4)

purchases of services the estimated cost of which does not exceed $100,000;

(5)

purchases of publications directly from the publisher;

(6)

fuel, oil, and grease purchases; and

(7)

distributor purchases.

(b)

Adherence to ethical standards. Employees of agencies who perform purchasing functions under delegated authority shall adhere to the same ethical standards required of commission employees, and shall avoid all conflict of interest in their purchasing activities.

(c)

Provisions generally applicable to delegated purchases.

(1)

Competitive bidding is not required for purchases of $2,000 or less.

(2)

All bids must be obtained from sources which normally offer for sale the merchandise being purchased.

(3)

Items purchased under delegated authority may not include scheduled items, items available under a term contract (unless purchased in quantities less than minimum ordering quantities shown in contract), or any item required by law to be purchased from a particular source.

(4)

The commission must solicit formal bids from all eligible vendors on the centralized master bidders list (CMBL) when making purchases in excess of $25,000. The commission waives the requirement for state agencies to solicit bids from all eligible vendors on the list when making purchases under subsection (e) of this section. State agencies must solicit from all eligible vendors on the CMBL when making service purchases in excess of $100,000 that the commission has delegated to an [ determined should be advertised and awarded by the ] agency.

[ (5)

Large purchases may not be broken down into small purchases in order to meet dollar limits specified in these rules. The commission may not require unrelated purchases to be combined into one purchase order to exceed dollar limits specified in these rules. ]

[ (6)

For purchases over $100,000, agencies shall consult with and receive approval of the commission for use of factors for bid evaluation other than price and meeting specifications. ]

(d)

Withdrawal of delegated purchase authority. The commission will verify compliance with established procedures for delegated purchases and may [ will ] withdraw delegated purchase authority in whole or part from an agency for continued violations after giving adequate warning. The commission will report to the governor, lieutenant governor, speaker of the house of representatives, and Legislative Budget Board the findings that a state agency has not followed the commission's rules or the laws related to the delegated purchases.

(e)

Provisions applicable to particular delegated purchases.

(1)

Commodity purchases. Commodity purchases may be made in accordance with the following provisions:

(A)

Agencies must attempt to obtain at least three informal bids, including a minimum of two bids from historically underutilized businesses (including at least one bid each from a minority-owned business and a woman-owned business), on all commodity purchases in excess of $2,000 and not over $10,000. Agencies must meet competitive bidding requirements and may supplement the list of bidders obtained from the CMBL and Historically Underutilized Business (HUB) Directory with non-CMBL bidders if the purchase price does not exceed $5,000. Agencies must attempt to obtain at least three formal bids, including a minimum of two bids from HUBs (including at least one bid each from a minority-owned business and a woman-owned business), on all commodity purchases in excess of $10,000 and not over $25,000. Agencies may refer to the commission's HUB Directory, which is maintained and accessible electronically, to locate historically underutilized businesses. If an agency is unable to locate a minority-owned business and/or a woman-owned business from the commission's HUB Directory or other available sources, the agency must make a written notation in the purchase file of all reference sources used.

(B)

Agencies must attempt to provide a copy of the bid to the last vendor who held the contract in addition to the informal bid requirement.

[ (B)

All information required by the commission must be furnished on the approved commodity purchase form.]

(2)

Emergency purchases. The commission will approve payment for emergency purchases in accordance with the following provisions.

(A)

At least three informal bids must be obtained whenever possible on all purchases in excess of $10,000.

(B)

For an emergency purchase of goods or services exceeding $25,000, an agency must send a full written explanation of the emergency along with other documentation required by the commission for prepayment approval.

(C)

The agency may contact the commission for advice and assistance in the handling of emergency purchases. The commission may not approve an invoice for an emergency purchase unless the agency has complied with the foregoing requirements. This rule does not apply to purchases made in accordance with the Texas Government Code, Chapter 418 (Texas Disaster Act of 1975) .

(3)

Perishable items. Purchases made under this authority must be obtained through competitive bids, and appropriate documentation must be forwarded to the commission for approval.

(4)

Services. Purchases of services estimated to cost no more than $100,000 per year per contract are delegated and must be obtained through a competitive selection process [ bids ], and appropriate documentation must be forwarded to the commission for approval.

(A)

An agency is required to submit documentation to the commission for proprietary purchases of services over $25,000 and for purchases expected to cost more than $25,000 per year.

(B)

Agencies must attempt to obtain at least three informal bids, including a minimum of two bids from HUBs (including at least one bid each from a minority-owned business and a woman-owned business), on all service purchases in excess of $2,000 and not over $10,000.

(C)

Agencies must meet competitive bidding requirements and may supplement the list of bidders obtained from the CMBL and Historically Underutilized Business (HUB) Directory with non-CMBL bidders if the purchase price does not exceed $5,000.

(D)

Agencies must attempt to obtain at least three formal bids, including a minimum of two bids from HUBs (including at least one bid each from a minority-owned business and a woman-owned business), on all service purchases in excess of $10,000 and not over $25,000. Agencies may refer to the commission's HUB Directory, which is maintained and accessible electronically, to locate historically underutilized businesses. If an agency is unable to locate a minority-owned business and/or a woman-owned business from the commission's HUB Directory or other available sources, the agency must make a written notation in the purchase file of all reference sources used. For purchases of services estimated up to $25,000, state agencies shall solicit a minimum of three bids (two must be HUBs, one minority and one woman-owned business) from CMBL and HUB Directory Vendors located in the agencies' geographic region.

(E)

For purchases of services estimated more than $25,000 and less than $100,000, state agencies shall, as a minimum, solicit bids from all CMBL and HUB Directory Vendors located in the agencies' geographic region.

(F)

For purchases of services estimated to cost more than $100,000 per year, the commission must review any proposed specifications or statements of work and determine whether the commission or the agency should make the advertisement and award. The commission may determine that the service should be advertised to the entire CMBL rather than to only those vendors in the agency's geographical area. [ commission's bidders lists, in which case the commission will make the award in accordance with normal open market procedures. ] If no competitive advantage would be obtained by having the commission make the advertisement and award, the commission may permit the agency to do so as a delegated purchase .

(5)

Publications. An agency may purchase publications directly from the publisher when such publications are not available through statewide contract or through competitive bidding. Direct publication orders shall be made by following guidelines established [ suggested ] by the commission. Examples of direct publications include, but are not limited to:

(A)

foreign publications;

(B)

out-of-print or rare publications;

(C)

back issues of magazines, journals, and newspapers;

(D)

publications of professional societies;

(E)

prepared films, tapes, and discs (audio, visual, or both);

(F)

computer software;

(G)

collections of any of the foregoing items, and microfilm or microfiche copies of any of the foregoing items; and

(H)

Library of Congress cards.

(6)

Fuel, oil, and grease. An agency may make fuel, oil, and grease purchases at service stations or in bulk. Fuel, oil, and grease purchases shall be made by following guidelines suggested by the commission. Non-competitive [ Spot ] and emergency purchase procedures apply to purchases at service stations.

(7)

Distributor purchases. An agency may make distributor purchases by following guidelines established [ suggested ] by the commission. An agency may not purchase any of the following on a distributor purchase basis: consumable items; labor of any kind (see "service"); "will fit" parts (non-OEM); parts for stock; contract items; electrical parts for electric motors; electrical switch panel boards; electrical accessories.

(f)

Specific delegations. The authority to grant specific delegations resides with the director. The application method, review process, delegation finding, and appeal process will be set forth by policy statement of the director. [ Between the effective date of this rule and January 31, 1999, all existing specific delegations will be reviewed for renewal or recision. ] At a minimum, state agencies granted specific delegations shall meet the following criteria:

(1)

procurement audit standards set forth in § 113.18 of this title (relating to Auditing of Purchase Documents and Payment Vouchers);

(2)

minimum training and certification standards established in the State Procurement Manual; and

(3)

approved processes and procedures for the specific type of delegation being requested. All processes and procedures are subject to the prior review, revision and approval of the director.

(g)

Protest Procedures. State agencies shall adopt protest procedures and submit a copy to the commission during the post-payment audit of the agency's purchasing documents or upon request by the commission.

(h)

Procurement Plan. State agencies shall formulate an agency procurement plan that identifies an agency's management controls and purchasing oversight authority in accordance with the policy guidance contained in the Commission's Procurement Manual. An agency must submit a copy of the procurement plan during the commission's audit of the agency's purchasing documents or upon request by the commission.

(i)

Debarred Vendors. State agencies shall ensure that debarred vendors do not participate in state contracting and will establish procedures to ensure awards are not made to debarred vendors.

(j)

Reporting Purchasing Activity under Delegated Authority. State agencies will report to the commission, not later than May 1 of each year regarding the previous six-month period and on November 1 of each year regarding the preceding fiscal year, information related to delegated purchasing activity for goods and services in the form prescribed by the commission.

[ (k)

Contingency Plan for Y2K. The Director of Central Procurement is authorized to assign special delegated purchasing authority temporarily to state agencies in the event Y2K problems occur with the General Services Commission's automated information systems. Upon notification from the Director of Information Services of the automated purchasing systems failure:]

[ (1)

The Director of Central Procurement will issue a letter to affected agencies permitting limited delegated purchasing authority.]

[ (2)

Special delegated purchasing authority will be rescinded by letter from the Director of Central Procurement after notice has been received from the Director of Information Services that problems have been resolved with the automated purchasing system.]

[ (3)

State agencies granted special delegated purchasing authority shall meet the criteria set forth in §113.18 of this title (relating to Auditing of Purchase Documents and Payment Vouchers).]

[ (4)

This subsection shall expire April 1, 2000.]

§113.12.Research in Higher Education.

(a)

At the request of an institution or other agency of higher education (institution), the commission shall delegate authority to purchase supplies, materials, services, or equipment for research projects. The commission will not delegate its responsibility to review proprietary purchases or any other responsibility which may not be delegated by law.

(b)

An institution acting under this delegated authority shall adhere to the same ethical standards required of commission employees, and shall avoid conflicts of interest in its purchasing activities.

(c)

An institution acting under this delegated authority shall comply with all applicable rules of the commission.

(d)

Purchases made under this authority shall be based on a competitive solicitation process [ bids whenever possible ]. When an institution oversees the competitive sealed proposal procedure, it must follow the statutory standards of Subchapter C, Chapter 2156, Government Code and the processes suggested in the Procurement Manual. If product competition is not available, the transaction must be justified as proprietary.

(e)

The institution may consider factors such as quality, reliability, expected life span, compatibility with existing equipment and any other factors which may be legally considered when making a purchase under this authority. Bid invitations or requests for proposals must include an evaluation plan describing the exact manner in which the factors will be evaluated. The evaluation plan must apply equally and impartially to each bid or proposal . An award may not be based on factors or criteria not specifically included in the bid invitation or request for proposal or otherwise permitted under the Act or these rules.

[ (f)

An institution acting under this authority is required to use the centralized bidders list for purchases in excess of $15,000. ]

§113.13.Texas Department of Criminal Justice Purchases.

(a)

Pursuant to Government Code, §2155.065, the [ The ] commission is authorized to make [ enters into ] contracts for the purchase of goods and services from [ supplies, materials, or equipment produced by ] the Texas Department of Criminal Justice (TDCJ) for use by other qualified ordering entities [ agencies ]. The commission may notify [ notifies ] agencies of the availability of TDCJ-produced goods and services [ supplies, materials, or equipment ] by issuing catalog pages listing the approved items in a manner suited to the product available for purchase .

(b)

Agencies must purchase such items from TDCJ unless a written waiver has been secured from TDCJ. [ : ]

[ (1)

the agency submits acceptable written evidence that a TDCJ-produced item will not adequately serve its needs;]

[(2)

TDCJ determines that it is unable to fill a requisition for the item; or]

[(3)

the agency determines that it can purchase the item elsewhere at a lower price, and the commission so certifies by accepting and processing the requisition or by approving payment. ]

(c)

Orders for such items will be placed with TDCJ in a [ the same ] manner mutually agreed upon [ as other contract orders are handled ]. For purchases within an agency's delegated authority, items not on contract [ of $10,000 or less agencies ] may be ordered [ order items not included in an established contract ] directly from TDCJ based on formal or informal quotations as appropriate for the value of the purchase .

§113.14.Purchases for School Districts.

(a)

The commission purchases motor vehicles used for transporting school children, including buses, bus chassis, bus bodies, tires, and tubes, for school districts participating in the Foundation School Program, in accordance with the provisions of the Texas Education Code, Chapter 34 [ 21 ], Subchapter A [ F ].

(b)

A school district initiates a purchase by submitting a requisition to the commission. Requisitions for school buses are forwarded to the Texas Education Agency for approval. All purchases are based on competitive bids whenever possible and must comply with:

(1)

the alternative fuels requirements of the Texas Education Code, Chapter 34 [ 21 ], Subchapter A [ F ];

(2)

§§113.23 [ §§113.21, 113.23, ] and 113.25 of this title (relating to Purchase of Alternative Fuel Vehicles); [ and ]

(3)

§125.3 of this title (relating to Definitions for alternative fuel and alternative fuel vehicles); and

(4)

[ (3) ] §125.65 of this title (relating to Reduction and/or Waiver of Required Fleet Percentages).

(c)

If a school district wishes to dispose of a used school bus, it should so advise the commission. The commission will then determine whether the bus should be transferred to another school district or to an agency. If the commission determines that the bus should not be transferred to another school district or an agency, the school district may sell the bus through the competitive bidding process. When selling a bus by competitive bidding, the school district must:

(1)

contact all bidders on the list described in subsection (d) of this section;

(2)

properly advertise the sale in a local newspaper;

(3)

award to the bidder submitting the highest bid;

(4)

furnish the commission a copy of the newspaper advertisement and a tabulation of all bids received, indicating to whom the bus was sold.

(d)

The commission maintains a list of bidders interested in bidding on used school buses, and furnishes the list to school districts that are permitted to sell used school buses. To be considered for inclusion on the list, an individual or firm should submit a completed application to the commission. Applications are available from the commission on request. No individual or firm will be placed on the bidders list for information purposes or to receive bids at more than one address.

(e)

An individual or firm may be deleted from the bidders [ mailing ] list for failure to bid, or failure to make payment. [ , or failure to promptly remove a purchased bus from public property. ] A bidder that has been removed from the bidders list may not be reinstated unless the bidder submits a written request for reinstatement and the Director of Business Services [ director ] approves the request.

§113.18.Auditing of Purchase Documents and Payment Vouchers.

(a)

General. The commission audits payment vouchers and the associated purchasing documents which established the basis for the claim for payment from state appropriated funds in accordance with Government Code, Title 10, Subtitle D, §2155.324 [ Texas Civil Statutes, Article 601b, §3 ].

(b)

Auditing procedure. The commission audits purchasing data for compliance with applicable statutes and rules of the commission. The commission may audit either 100% of State of Texas purchase vouchers and associated purchase documentation of any agency, a sampling of all documents, or may audit only specific types of purchases. [ or a combination of agencies and specific purchases. ] The commission may determine the extent and method of audits to be performed. The commission may perform audits at the 100% level or may use a statistical random sample and the samples may be stratified. The sampling selection process may be stratified by dollar amounts or other parameters. These random sample audits may be performed prior to (pre-payment audits) or after (post-payment audits) the vouchers are paid by the Comptroller of Public Accounts. Each agency will be audited at least once in each state fiscal biennium. Agencies will be required to furnish copies of purchase documents to the commission for these audits as needed . Audits may be performed at the agency site or remotely [ by mail ].

(c)

Auditing parameters.

(1)

For 100% audits, delegated and non-delegated purchases , the results must be at or above the 90% compliance level for each agency.

(2)

For the random sample audits, delegated and non-delegated purchases , the results must be within the following parameters:

(A)

minimum confidence level--90%;

(B)

maximum error level--10%;

(C)

minimum sample size--10 per agency and 10 per Purchase Category Code;

(D)

period of time--monthly, quarterly, semiannual, annual, or biennial; and

(E)

selection of sample--may be by table of random numbers or any other interval method.

(d)

Agency notification. The commission will send results of these audits to the agency head, agency's directors of purchasing, and fiscal and/or business manager. If the results are not within the established parameters, the agency will be offered support and assistance to maintain an acceptable level of compliance. Agencies will be given a period of six months to bring their purchasing compliance within the established parameters. If the results of a [ the ] second (follow-up) audit [ (re-audit) ] still do not meet [ fall within ] the parameters, then delegation of authority for some or all purchase categories may be suspended.

Qualification of Information Systems Vendors [ Catalogue Purchase Procedure for Automated Information Systems ]

(a)

Upon registration on the commission's Centralized Master Bidders List (CMBL), a vendor wishing to sell or lease automated information systems to governmental entities in accordance with this rule shall apply to the commission for designation as a qualified information systems vendor (QISV) by completing and submitting an application and catalogue.

(b)

In this section a governmental entity is a state agency subject to the Information Resources Act (Texas Government Code, Title 10, Subtitle B, Chapter 2054) or a local government entity that participates in the Cooperative Purchasing Program under the Texas Local Government Code, Title 8, Subtitle C, Subchapter D.

(c)

An application must include the following:

[ (1)

the vendor's maintenance, repair and support plan for all eligible products and services;]

[ (2)

proof of the vendor's financial resources and ability to perform;]

[ (3)

a guarantee that the vendor will make available repair and replacement parts as well as technical information required for repair of products sold for at least three years from the date of a product's discontinuance; ]

(1)

[ (4) ] a statement detailing the geographic area in Texas to which the vendor desires to market catalogue products and services;

[ (5)

a statement certifying that: ]

[ (A)

the vendor has reviewed the rules promulgated by the Department of Information Resources (DIR) and that all products and services offered in the vendor's catalogue conform and comply with all applicable standards adopted by the DIR; ]

[ (B)

the vendor has not given, offered to give, nor intends to give at any time hereafter any economic opportunity, future employment, gift, loan, gratuity, special discount, trip, favor, or service to a public servant in connection with catalogue purchase transactions; ]

[ (C)

the vendor is not currently delinquent in the payment of any franchise tax owed the State of Texas under the Texas Tax Code, Title 2, Subtitle F, Chapter 171; ]

[ (D)

the vendor assigns to purchaser any and all claims for overcharges associated with any catalogue transaction which arise under the antitrust laws of the United States or the State of Texas; and ]

[ (E)

the vendor will protect governmental entities from claims involving infringement of patents or copyrights; ]

(2)

[ (6) ] a statement acknowledging that any terms and conditions in the vendor's catalogue that conflict with the Constitution or laws of the State of Texas shall not be enforceable and, therefore, will not be binding;

[ (7)

the name, address, telephone number and point of contact for three customer references;]

[ (8)

the signature of the vendor's authorized representative; ]

[ (9)

the date the application was signed; and]

[ (10)

the vendor's catalogue's universal resource locator (URL) in accordance with subsection (o) of this section.]

(d)

Upon receipt of a properly completed application, the director [ Director of Central Procurement Services Division ] or the director's designee shall give consideration to the following standards and criteria when deciding to designate a vendor as a QISV : [ . ]

[ (1)

the technical adequacy and reliability of the vendor's products as demonstrated by conformity to all state and federal requirements, including but not limited to ANSI, FCC, NEMA, OSHA and UL standards; ]

(1)

[ (2) ] the [ award ] criteria set forth in the Texas Government Code, §§2157.06 and 2157.065 [ §2156.007 ];

(2)

[ (3) ] the vendor's history of performance under Texas Government Code, §2155.077. [ past and current status on the commission's CMBL and any unresolved complaints on record; and ]

[ (4)

the ability of the vendor, as determined by the commission in its sole discretion, to provide adequate and reliable support and maintenance, currently and in the future, for all products and services detailed in the vendor's catalogue for the geographic area in Texas to which the vendor desires to market products and services. ]

(e)

An application that is incomplete or that contains inaccurate information will not be approved, and the vendor will be notified of corrections needed.

(f)

Each vendor's catalogue shall:

(1)

Conform to requirements set forth in Texas Government Code, §2157.066 and any other requirements established by the commission.

[ (1)

describe all products or services eligible for purchase; ]

[ (2)

include the list price of each product or service; ]

[ (3)

show the discounted price to the state for each product or service; ]

[ (4)

include an effective date; ]

[ (5)

provide necessary ordering information (vendor name, ordering address, points of contact, phone numbers, etc.); ]

[ (6)

contain the statement: "This is a true and accurate copy of the catalogue approved through the General Services Commission;" and]

(2)

[ (7) ] be maintained on a website in accordance with subsection (l) [ (o) ] of this section and include indexing and keywords consistent with the commission's web catalogue guidelines. The vendor's catalogue maintained on the website and in compliance with this rule shall be the official version of the catalogue.

(g)

A vendor designated as a QISV shall be notified of the designation by the commission. Once designated as a QISV, the vendor shall maintain a catalogue listing all products and services available for purchase and shall make the same available to qualified ordering entities upon request at no cost . [ The QISV shall provide catalogues to all governmental entities upon request. ]

(h)

The director shall promulgate guidelines for the revision process of a vendor's catalogue.

[ (h)

The vendor shall update its catalogue as needed to reflect changes in price and the availability of products or services offered. Updates may be in the form of amendments to the current catalogue or issuance of supplemental catalogues in compliance with subsection (g) of this section and in a manner required by the commission. It shall be the responsibility of the individual purchaser/governmental entity and the vendor to ensure that QISV catalogues are current and include all updates.]

[ (i)

The vendor must provide the commission an annual report to maintain its qualification status. The report, due by the 15th of September, shall include the following information for the preceding year (ending August 31st): ]

[ (1)

each governmental entity's identity;]

[ (2)

the purchaser's requisition or purchase order number and its date;]

[ (3)

the value of the order; and]

[ (4)

total value of all orders.]

(i)

[ (j) ] Failure of a vendor [ to provide the required annual reports, ] to remain active on the CMBL, or failure to conform to any other commission rules may result in suspension or removal of QISV status. A vendor that has been suspended or removed may not market or sell products or services from its [ their ] QISV catalogue to the state until the cause of the suspension or removal has been resolved.

(j)

[ (k) ] The vendor shall retain all records related to any business transaction under the catalogue purchase procedure for automated information systems for five years from the date of the purchase order. The records shall be provided upon request to the commission or the actual purchaser.

(k)

[ (l) ] Preference shall be given to QISV's who sell or lease products in Texas in accordance with provisions of [ or services pursuant to ] the Texas Government Code, §2155.4441 [ §2155.441 ].

(l)

[ (m) ] The QISV vendor is encouraged to:

(1)

use, produce, or provide products that contain recycled or remanufactured content, are environmentally sensitive, or possess energy saving features;

(2)

identify recycled or remanufactured products and if possible, include the percentage of the total product that is recycled or remanufactured and/or the percentage of the total post-consumer recycled material content in its product literature or other representations; and

(3)

use recycled/recyclable paper if printing a catalogue.

(m)

[ (n) ] The State of Texas is committed to assisting historically underutilized businesses (HUBs) to receive a portion of the total value of all contracts that an agency will award. If the vendor qualifies as a HUB, but is not certified by the State of Texas as such, the vendor should contact the commission to obtain a HUB certification application. Upon the request of a governmental entity, the vendor will be required to detail the amount of expenditures that have been made to material suppliers and subcontractors that are Texas certified HUBs. A vendor that has demonstrated past HUB participation is still expected to provide documentation using the reporting forms provided by a governmental entity to show its good faith effort in meeting or exceeding the state's procurement utilization goals identified in GSC's HUB Rules (1 TAC §111.14).

(n)

[ (o) ] Once the process for utilizing URL's has been established and is operational, the GSC will create deadlines whereby all QISV's must provide and maintain [ the GSC with ] their URL.

§113.20.Group Purchasing Programs.

(a)

An institution of higher education, as defined by Education Code, §61.003, or a state agency may purchase materials, supplies, or equipment through group purchasing programs in accordance with this section.

(b)

Before making a particular purchase through a group purchasing program that costs more than $100,000, an institution or state agency must notify the commission in writing that the purchase is being considered. The notification must be signed by the chief purchasing officer for the institution or state agency. The notification must include a complete description of the purchase, the vendor's name, quantity and price information, the terms and conditions of the contract, and any other information required by the commission.

(c)

If the commission determines that a better value is available through the commission, it will so inform the requesting institution or state agency within ten working days after receipt of the notification. Upon receipt of information that a better value is available, the institution or state agency shall utilize established purchasing procedures for the purchase including good faith effort compliance §§111.11-111.28 of this title (relating to Historically Underutilized Businesses) . If the institution or state agency does not receive such notification within ten working days, it may proceed with the purchase.

[ (d)

An institution or state agency that participates in a group purchasing program must maintain, and compile monthly, information relating to the institution's or state agency's use, and the use by each operating division of the institution or state agency, of historically underutilized businesses, including information regarding subcontractors and suppliers. Institutions or state agencies shall require a contractor or supplier to whom a contract has been awarded to report to the institution or state agency the identity and the amount paid to each historically underutilized business to whom the contractor or supplier has awarded a subcontract for the purchase of supplies, materials, or equipment. ]

[ (e)

An institution or state agency that participates in group purchasing programs must submit a report to the commission, not later than March 15 of each year regarding the previous six-month period and September 15 of each year regarding the preceding fiscal year, of purchases from historically underutilized businesses that are made through the group purchasing programs. ]

(d)

[ (f) ] An institution or state agency participating in group purchasing programs shall adhere to the same ethical standards required of commission employees as set forth in §111.4 of this title (relating to Ethical Standards).

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 24, 2000.

TRD-200003705

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter C. SPECIFICATION

1 TAC §113.33, §113.34

The amendments are proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155.068, 2155.077, 2155.079, 2155.080, 2155.081, 2155.132, 2155.134, 2155.267, 2155.323 2156.126, and 2251.003; Texas Government Code, Chapter 2158; and Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, Texas Government Code, Chapter 2251, and Education Code, Chapter 34, Subchapter A. List any other statute that may be affected.

§113.33.Selection of Items for Development of Texas Uniform Standards and Specifications.

Items are selected for specification development by or through one or more of the following methods.

(1)

Required by statute.

(A)

School buses. Pursuant to the Texas Education Code, Subtitle F, Chapter 34, the Central Procurement Division [ §11.12, the State Purchasing and General Services Commission ] has the responsibility to "coordinate and correlate all specification data, finalize and issue the uniform standards and specifications, [ specification ] so adopted."

(B)

Prison-made products and raw materials. Pursuant to Texas Government Code, Subtitle G, Subchapter B, §497.027, an article or product produced under Subchapter B must meet specifications established by the commission that are in effect when the article or product is produced. [ Texas Civil Statutes, Article 6203c, 9(d): "Any product or article manufactured by the Texas Department of Corrections shall be manufactured and/or produced only upon state specifications developed by and through the state." ]

(2)

Requests from using agencies. If a using agency finds that it is having difficulty in obtaining a certain item to meet a particular requirement, then the agency can communicate this need to the standards and specifications section of the Central Procurement Division [ Specification Section, State Purchasing and General Services Commission ].

(3)

Requests from purchasers. If a state purchaser is having difficulty in securing bids on a particular item in the absence of adequate uniform standards and specifications, he may request the standards and specification section [ Specification Section ] to investigate the feasibility of developing a uniform standard and specification to cover the purchase of this item.

(4)

Requests from vendors and/or bidders. Bidders may [ If a bidder finds that he is bidding against his competition on a variety of quality levels of a given product, then he may ] petition the standards and specification section [ Specification Section ] to ascertain the feasibility of developing a specification on an [ the ] article bid by agencies .

§113.34.Development of Texas Uniform Standards and Specifications.

(a)

Preparation of Texas uniform standards and specifications.

(1)

The procedure used in developing uniform standards and specifications includes consultation, research, collection, and evaluation of data, and preparation of the specification. The standards and specification section [ Specification Section ] consults with knowledgeable people in various state agencies, user advisory groups, purchasers, vendors, manufacturers, distributors, bidders, governmental and trade associations, colleges and universities, testing laboratories, and other experts.

(2)

Uniform standards [ Standards ] and specifications from federal, state, and local governments and standards agencies, such as ASTM, SAE, and others, and product literature from manufacturers, distributors, etc., are obtained, studied, and their contents evaluated.

(3)

A proposed specification is then prepared by stipulating minimum requirements necessary to provide products of the level of quality required by [ the ] various state agencies.

(4)

This draft [ tentative ] specification is then distributed to the individuals and groups initially contacted as well as other interested parties for their review, comments, and suggestions.

(5)

Comments and suggestions received are reviewed, analyzed, and evaluated, and the proposed specification modified accordingly.

(6)

If, as a result of this analysis and evaluation, major changes in the proposed specification are made, then a second proposed specification is prepared and distributed and the process outlined in paragraphs (4) and (5) of this subsection is followed [ as before ].

(7)

If no major change in the proposed specification is made, then the uniform standard and specification is finalized and distributed.

(8)

Comments and suggestions received from the distribution of a second proposed specification are reviewed, analyzed, [ and ] evaluated , and the process outlined in paragraphs (5) and (7) of this subsection is followed [ as before ].

(9)

This process is continued until a uniform standard and specification is developed that will provide the level of quality required by the state and that will provide competitive bidding.

(10)

The agency user advisory groups provide the standards and specifications section [ Specifications Section ] with their individual requirements and otherwise assist in the preparation and development of specifications.

(b)

Distribution of Texas uniform standards and specifications. The initial distribution of newly adopted or prepared uniform standards and specifications is to state agencies, vendors/distributors and manufacturers [ those individuals and organizations (including bidders, known vendors, and distributors) ] contacted during the development phase of the uniform standard and specification and subsequently to others upon request. [ The former group includes: ]

[ (1)

state agencies;]

[ (2)

vendors/distributors; and]

[ (3)

manufacturers. ]

[ (c)

Use of Texas specifications. All agencies and public school districts which purchase through the State Purchasing and General Services Commission are required to use Texas specifications, unless documentation is presented giving justifiable reasons acceptable to the commission for deviation from the Texas specifications.]

(c)

[ (d) ] Approved products list.

(1)

A manufacturer, vendor, or distributor may submit a product for inclusion in an established approved product list to the standards and specifications section the Central Procurement Division [ Specification Section, State Purchasing and General Services Commission ], along with technical literature and product specifications. The product may then be tested and the results evaluated and compared with the minimum level of quality for the approved products list.

(2)

A product can be removed from the approved products list if:

(A)

the quality of a given product is decreased; or

(B)

the minimum level of quality for the approved products list is increased in order to provide the quality of products required by state agencies.

[ (3)

The Central Purchasing Division uses the approved products list in lieu of a Texas specification; the purchaser solicits bids from the manufacturers whose products are on the list.]

[ (e)

New procedures and specifications. In developing new procedures and specifications, the commission shall encourage the use of recycled, remanufactured or environmentally sensitive products and products that may be recycled or reused.]

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 24, 2000.

TRD-200003706

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter D. INSPECTION

1 TAC §§113.51, 113.52, 113.56

The amendments are proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155.068, 2155.077, 2155.079, 2155.080, 2155.081, 2155.132, 2155.134, 2155.267, 2155.323 2156.126, and 2251.003; Texas Government Code, Chapter 2158; and Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, Texas Government Code, Chapter 2251, and Education Code, Chapter 34, Subchapter A. List any other statute that may be affected.

§113.51.General.

Pursuant to Texas Government Code, Title 10, Subtitle D, §2155.069 [ Civil Statutes, Article 601b, §3.17 ], the General Services Commission has established and maintains a program of testing and inspecting purchases made by the commission at the request of state agencies to insure that the materials, supplies, services, and equipment meet specifications. The responsibility for the inspection and testing program has been delegated to the Vendor Relations Program [ Inspection Section ] of the Central Procurement [ Purchasing ] Division. The commission shall provide for the inspecting and testing of all costly purchases as required .

§113.52.[ Selection of Items for ] Inspection and/or Testing.

(a) Items are selected for inspection and/or testing under the following conditions : [ . ]

(1)

Notice from a using qualified ordering entity [ agency ]. If a using qualified ordering entity [ agency ] determines that any supplies, materials, services, or equipment received do not meet specifications, it is the responsibility of the qualified ordering entity [ agency ] to notify the Central Procurement [ Purchasing ] Division in writing detailing the reasons why the item received does not meet the specifications of the contract.

(2)

Notice from purchaser. The various purchasers within the Central Procurement [ Purchasing ] Division may "flag" purchase orders at time of issue with a request for inspection and/or testing of the items purchased after their arrival at the receiving qualified ordering entity [ agency ].

(3)

Previous experience with products and/or vendors. The GSC inspector [ chief of the Inspection Section ] may direct inspections and/or testing of products based on previous experience of deficiency of the products or of vendors delivering products other than those specified on the purchase order.

(4)

Items selected at random. The GSC inspector [ chief of the Inspection Section ] may direct inspections and/or testing of items selected from purchase orders at random for spot checking.

(5)

Request from vendor. A vendor may request the inspection of items purchased prior to or after delivery of the items to the qualified ordering entity [ agency ]. Such inspections are made only upon the approval of the [ assistant ] director [ for purchasing ].

(6)

Certificate and/or test report from independent testing laboratory. When deemed necessary, the Central Procurement Division [ the State Purchasing and General Services Commission ] may require the bidder and/or the vendor to supply a certificate and/or a test report from an independent testing laboratory showing that the product offered or delivered meets or exceeds the requirements of the specification and/or contract.

(7)

In-plant inspection. When approved by the director of the Central Procurement Division [ for purchasing ], certain items may be inspected by GSC Vendor Relations [ Inspection Section ] personnel or the commission's designated agent in the plant of the manufacturer during the process of manufacture. Examples of the type of items so inspected include school buses, paint, retreading rubber for tires, etc. Products not meeting specifications may be rejected prior to shipment.

(b)

Qualified ordering entities [ State agencies ] shall be responsible for the initial inspection and testing of all [ costly ] purchases. Inspection and testing will be done in accordance with instructions issued by the Central Procurement Division [ Specifications and Inspection Section of the General Services Commission ]. Appropriate forms may be devised [ The Specifications and Inspection Section may devise appropriate form(s) as necessary ] to assist the qualified ordering entities [ agencies ] in carrying out this duty.

(c)

In addition to random inspections, the Vendor Relations Program [ Specification and Inspection Section ] may conduct follow-up inspections of purchases which fail initial agency inspections to verify if specifications are met. The Vendor Relations Program [ Specifications and Inspection Section ] will coordinate with the [ assigned ] purchaser as required to carry out these duties.

[ (c)

As a part of the standards and specifications program, the commission staff shall review existing contracts in effect on and after September 1, 1991, for recycling waste produced at state buildings under the control of the Commission. Such review shall be made to ensure that all contracted recycling services meet contract specifications.]

(d)

Reports of findings on inspections and/or tests of materials, supplies, services, and equipment are filed with the Vendor Relations Program for recording and/or proper action to eliminate the problem.

§113.56. Assessing and Collecting Damages and Testing Costs.

(a)

The Central Procurement [ Purchasing ] Division [ of the commission ] shall assess all damages and shall collect damages and recover testing costs on behalf of the using qualified ordering entity [ agency ].

[ (b)

Damages and/or testing costs may be deducted from any payments owed the supplier by the state.]

(b)

[ (c) ] Failure on the part of the supplier to pay an assessed damage or testing cost may be cause for suspension [ removal ] from the state bid list.

(c)

[ (d) ] If the vendor relations program director [ chief of specifications and inspections ] identifies repeated complaints on any vendor, that vendor may be removed by the director [ for purchasing ] from the commission's bid lists through the debarment process as set forth in 113.102 of this title (relating to Vendor Performance and Debarment). [ for a period not to exceed one year. ]

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 24, 2000.

TRD-200003708

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter E. COOPERATIVE PURCHASING PROGRAM

1 TAC §113.85, §113.87

The amendment are proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155.068, 2155.077, 2155.079, 2155.080, 2155.081, 2155.132, 2155.134, 2155.267, 2155.323 2156.126, and 2251.003; Texas Government Code, Chapter 2158; and Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, Texas Government Code, Chapter 2251, and Education Code, Chapter 34, Subchapter A. List any other statute that may be affected.

§113.85.Participation in Cooperative Purchasing.

(a)

Qualified ordering entity participation in the cooperative purchasing program is on a voluntary basis and to the extent the commission deems feasible. The director [ for purchasing ] shall determine the feasibility of participation based on availability of resources to perform the required purchasing services. A qualified ordering entity may be enrolled in the program only after submission of a resolution approved by the entity's governing body . The resolution must specify the agent of record, acknowledge an [ acknowledgment of ] obligation to pay participation fees established by the commission, and be signed by the person(s) with authority to legally act on behalf [ chairman ] of the qualified ordering entity [ governing body ].

(b)

Enrollment in the program will be in effect from the day of approval by the director [ receipt by the commission of a complete resolution ], until notification is received from the qualified ordering entity to discontinue its participation in the cooperative purchasing program or the entity is otherwise terminated by the director for cause . Any change in the resolution [ of a jurisdiction or participation status ] must be made in writing by a person(s) with the authority to legally act on behalf of the governing body [ the agent of record or chairman of the governing body ].

(c)

Requests for purchase on the open market or on a schedule may be made in writing to the director [ for purchasing ]. The director [ for purchasing ] or his designee will determine the feasibility of accomplishing the purchase on a case-by-case basis [ , ] and will advise the qualified ordering entity of the determination within a reasonable period of time.

§113.87.Responsibilities of Qualified Ordering Entities.

(a)

A qualified ordering entity participating in the cooperative purchasing program must:

(1)

submit a resolution evidencing its intent to participate in the cooperative purchasing program and pay costs associated therewith;

(2)

transmit information as follows:

(A)

send automated term contract and schedule requisition to the commission for processing; send a copy of all non-automated contract purchase orders to the commission for data collection; or

(B)

using a system approved by the commission, electronically send purchase orders directly to vendors and electronically send reports of actual purchases made through this program to the commission;

(3)

pay the vendor under each contract directly; and

(4)

be responsible for the vendor's compliance with all terms and conditions of performance under the contract.

(b)

A qualified entity that purchases an item from a state contract satisfies any state law requiring the qualified entity to seek competitive bids for the purchase.

(c)

A qualified entity that utilizes the catalogue purchase procedure satisfies any requirements of Government Code, §2155.067 [ Texas Civil Statutes, Article 601b, §3.081, and §113.19 of this title (relating to Catalogue Purchase Procedure for Automated Information Systems) ].

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 24, 2000.

TRD-200003709

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter G. BUYING UNDER CONTRACT ESTABLISHED BY AN AGENCY OTHER THAN THE GENERAL SERVICES COMMISSION

1 TAC §113.125

The amendment is proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155.068, 2155.077, 2155.079, 2155.080, 2155.081, 2155.132, 2155.134, 2155.267, 2155.323 2156.126, and 2251.003; Texas Government Code, Chapter 2158; and Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, Texas Government Code, Chapter 2251, and Education Code, Chapter 34, Subchapter A. List any other statute that may be affected.

§113.125.Buying Under Contract Established By An Agency Other Than Commission.

(a)

A state agency may purchase goods or services under a contract made by another state agency other than the commission by complying with this rule.

(b)

A state agency, including the commission, must state a justification on how using the existing contract will be more advantageous than creating another contract. Circumstances for this would include reduced administrative costs and aggregate purchasing power. Before making a particular purchase, the requesting state agency must notify the commission in writing that the purchase is being considered. [ The agency must state in the request why it is advantageous for the Commission to allow other agencies to purchase goods or services from another state agency other than the commission. ] The notification must be signed by the chief purchasing officer for the agency.

(c)

The authority to authorize a purchase under a contract made by another state agency other than the commission resides with the director. If the director [ commission ] determines that a lower price is available through the commission or the goods or services are already available through a contract administered by the commission, it will so inform the requesting agency after receipt of the notification. Upon approval to use the other contract, [ Upon receipt of information that a lower price is not available ], the requesting agency shall utilize established purchasing procedures for the procurement.

(d)

When a contract created by another agency fulfills an unmet need for more than one agency, the director may endorse the contract of the other agency as a GSC contract, and make it generally available to state agencies and other qualified ordering entities as appropriate.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003710

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Chapter 113. CENTRAL PURCHASING DIVISION

The General Services Commission proposes the repeal of Title 1, T.A.C., Chapter 113, Subchapter A - Purchasing, §113.17; Subchapter B - Purchase of Alternative Fuel Vehicles, §113.21; Subchapter C - Specification, §113.31 and §113.32; Subchapter D - Inspection, §113.53; Subchapter E - Cooperative Purchasing Program, §113.83 and §113.88; and Subchapter F - Vendor Performance and Debarment Program, §113.100. The proposed repeal is concerning the Central Purchasing Division and is a result of the rule review process mandated by Texas Government Code, §2001.039 (relating to Agency Review of Existing Rules). The proposed repeal will delete obsolete language and will improve the readability of Chapter 113.

Mr. Paul Schlimper, Director of Central Procurement, has determined for the first five year period the rules are in effect, there will be no adverse effect to state or local government as a result of enforcing these rules.

Mr. Paul Schlimper, Director of Central Procurement, further determines that for each year of the first five-year period the repeals are in effect, the public benefit anticipated as a result of enforcing these rules will be the deletion of cumbersome and outdated language. There will be no effect on small or large businesses and/or persons.

Comments on the proposals may be submitted to Ann Dillon, General Counsel, General Services Commission, P.O. Box 13047, Austin, TX 78711-3047. Comments must be received no later than 30 days from the date of publication of the proposal to the Texas Register .

Subchapter A. PURCHASING

1 TAC §113.17

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the General Services Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal is proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155,068, 2155.069, 2155,077, 2155.134, 2177.001 and the Texas Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, and Education Code, Chapter 34.

§113.17.Unsolicited Offers.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003711

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter B. PURCHASE OF ALTERNATIVE FUEL VEHICLES

1 TAC §113.21

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the General Services Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal is proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155,068, 2155.069, 2155,077, 2155.134, 2177.001 and the Texas Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, and Education Code, Chapter 34.

§113.21.Definitions.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003712

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter C. SPECIFICATION

1 TAC §113.31, §113.32

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the General Services Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeals are proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155,068, 2155.069, 2155,077, 2155.134, 2177.001 and the Texas Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, and Education Code, Chapter 34.

§113.31.General.

§113.32.Definitions.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003713

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter D. INSPECTION

1 TAC §113.53

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the General Services Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal is proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155,068, 2155.069, 2155,077, 2155.134, 2177.001 and the Texas Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, and Education Code, Chapter 34.

§113.53.Reports of Inspections and Tests.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003714

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter E. COOPERATIVE PURCHASING PROGRAM

1 TAC §113.83, §113.88

(Editor's note: The text of the following sections proposed for repeal will not be published. The sections may be examined in the offices of the General Services Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeals are proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155,068, 2155.069, 2155,077, 2155.134, 2177.001 and the Texas Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, and Education Code, Chapter 34.

§113.83.Definitions

§113.88.Electronic Purchasing Systems.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003716

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Subchapter F. VENDOR PERFORMANCE AND DEBARMENT PROGRAM

1 TAC §113.100

(Editor's note: The text of the following section proposed for repeal will not be published. The section may be examined in the offices of the General Services Commission or in the Texas Register office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)

The repeal is proposed under the authority of the Texas Government Code, Title 10, Subtitle D, §§2152.003, 2155,068, 2155.069, 2155,077, 2155.134, 2177.001 and the Texas Education Code, §34.001 which provides the General Services Commission with the authority to promulgate rules necessary to implement the sections.

The following code is affected by these rules: Government Code, Title 10, Subtitle D, and Education Code, Chapter 34.

§113.100.Definitions.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 25, 2000.

TRD-200003715

Ann Dillon

General Counsel

General Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 463-3960


Part 15. TEXAS HEALTH AND HUMAN SERVICES COMMISSION

Chapter 355. MEDICAID REIMBURSEMENT RATES

Subchapter A. COST DETERMINATION PROCESS

1 TAC §355.101

The Texas Health and Human Services Commission (HSSC) proposes an amendment to §355.101, concerning introduction, in its Medicaid Reimbursement Rates chapter. The purpose of the amendment is to establish payment rates for two years coincident with the state biennium. It will allow payment rates to be determined at the same time that the state legislature is establishing funding for these programs for the state's biennium. The proposal requires that payment rates for the Nursing Facility, Community Based Alternatives Waiver, Community Living Assistance and Support Services, Primary Home Care, Day Activity and Health Services, and Deaf-Blind Multiple Disabilities Waiver programs be determined on a state fiscal year basis for a period of two years.

The Texas Department of Human Services proposes similar policy for non-Medicaid funded services, codified at 40 TAC §20.101, in this issue of the Texas Register .

Don Green, chief financial officer, has determined that for the first five-year period the section is in effect there will be no fiscal implications for state or local government as a result of enforcing or administering the section.

Commissioner Don Gilbert also has determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be that payment rates for the programs will be determined at the same time that the state legislature is establishing funding for these programs for the state's biennium. There will be no effect on large, small, or micro businesses, because the proposal changes the annual rate determination cycle to a biennial rate determination. No changes in practice are required of any business. There is no anticipated economic cost to persons who are required to comply with the proposed section.

Questions about the content of this proposal may be directed to Carolyn Pratt at (512) 438-4057 in DHS's Rate Analysis Department. Written comments on the proposal may be submitted to Supervisor, Rules and Handbooks Unit-215, Texas Department of Human Services E-205, P.O. Box 149030, Austin, Texas 78714-9030, within 30 days of publication in the Texas Register .

For further information, contact local offices of the Texas Department of Human Services.

The amendment is proposed under the Government Code, §531.033, which authorizes the commissioner of the Health and Human Services Commission to adopt rules necessary to carry out the commission's duties, and §531.021(b), which establishes the commission as the agency responsible for adopting reasonable rules governing the determination of fees, charges, and rates for medical assistance payments under Chapter 32, Human Resources Code.

The amendment implements the Government Code, §§531.033 and 531.021(b).

§355.101.Introduction.

(a)-(b)

(No change.)

(c)

The Texas Department of Human Services (DHS) reimburses providers for contracted client services through reimbursement amounts determined as described in this chapter and in reimbursement methodologies for each program. Non-Medicaid, statewide, uniform reimbursements and reimbursement ceilings are approved by the Texas Department of Human Services. Medicaid, statewide, uniform reimbursements, and reimbursement ceilings are approved by the Texas Health and Human Services Commission (HHSC). In Medicaid programs where reimbursements are contractor-specific, the HHSC approves the reimbursement parameter dollar amounts, e.g., ceilings, floors, or program reimbursement formula limits. In approving reimbursement amounts DHS or the HHSC takes into consideration staff recommendations based on the application of formulas and procedures described in this chapter and in reimbursement methodologies for each program. However, DHS or the HHSC may adjust staff recommendations when DHS or the HHSC deems such adjustments are warranted by particular circumstances likely to affect achievement of program objectives, including economic conditions and budgetary considerations. Medicaid reimbursement methodology rules are developed and recommended for approval to the HHSC. The HHSC has oversight authority with respect to the state's Medicaid rules.

(1)

Reimbursement amounts will be determined coincident with the state's biennium.

(2)

[ (1) ] Objective of cost determination process. The objective of the cost determination process is to define direct and indirect costs which are allowable and, therefore, may be considered for use in the overall reimbursement determination process. The cost determination process seeks to collect accurate financial and other statistical data which constitute the foundation upon which reimbursements are determined.

(A)

Cost-reporting. In order to ensure adequate financial and statistical information upon which to base reimbursement, DHS requires that each contracted provider submit a periodic cost report or supplemental report. It is the responsibility of the provider to submit accurate and complete information, in accordance with all pertinent DHS cost reporting rules and cost report instructions, on the cost report and any supplemental reports required by DHS.

(B)

Pro forma costing. When historical costs are unavailable, such as in the case of a new program, reimbursement may be based on a pro forma approach. This approach involves using historical costs of delivering similar services, where appropriate data are available, and estimating the basic types and costs of products and services necessary to deliver services meeting federal and state requirements.

(3)

[ (2) ] Relationship between cost determination and reimbursement determination processes. The cost determination process seeks to evaluate individual cost items of providers to determine their allowability and to determine whether individual cost reports are of reasonable accuracy for potential use in reimbursement determination. The reimbursement determination process takes the evaluation of allowable costs one step further by comparing allowable costs across providers to identify those levels of cost, either for individual cost items or groups of cost items, which must be incurred by efficient and economic providers of services meeting all state and federal standards. Thus, all costs allowed in the cost determination process may not necessarily be used in the reimbursement determination process. The basic objective of the reimbursement methodologies employed by DHS is to facilitate and balance the broader objectives of the programs administered by the agency by:

(A)

promoting reasonable access for eligible clients to services that meet federal and state quality standards via contracting with an adequate number of qualified providers; and

(B)

expending taxpayer dollars in a reasonable and prudent manner such that eligible clients are served at the lowest cost to taxpayers consistent with state and federal laws, standards and regulations, and with program objectives.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on May 23, 2000.

TRD-200003644

Marina Henderson

Executive Deputy Commissioner

Texas Health and Human Services Commission

Earliest possible date of adoption: July 9, 2000

For further information, please call: (512) 438-3108