HB2148 - Relating to the construction manager-at-risk and design-build methods of project delivery for a public work contract.

  89R6375 JCG-D     By: Gervin-Hawkins H.B. No. 2148       A BILL TO BE ENTITLED   AN ACT   relating to the construction manager-at-risk and design-build   methods of project delivery for a public work contract.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 2269.253, Government Code, is amended by   amending Subsections (d) and (e) and adding Subsection (e-1) to   read as follows:          (d)  If a one-step process is used, the governmental entity   shall [ may ] request, as part of the offeror's proposal :                 (1) [ , ] proposed fees and prices for fulfilling the   general conditions ; and                 (2)     proposed prices and methods for preventing and   managing the risk of default by a trade contractor or   subcontractor .          (e)  If a two-step process is used, the governmental entity   may not request fees or prices in step one. In step two, the   governmental entity shall [ may ] request that five or fewer   offerors, selected solely on the basis of qualifications, provide   additional information, including the construction   manager-at-risk's :                 (1)   proposed fee and prices for fulfilling the general   conditions ; and                 (2)     proposed prices and methods for preventing and   managing the risk of default by a trade contractor or   subcontractor .           (e-1)     A governmental entity's request for proposals in a   one-step process or request for qualifications in a two-step   process must clearly provide that the proposed prices for   fulfilling the general conditions and the proposed prices for   preventing and managing risk of default by a trade contractor or   subcontractor are allowable costs for all purposes of the   construction contract, including for the purpose of calculating the   construction manager-at-risk's fee.   A provision of a request for   proposals, a request for qualifications, or a construction contract   entered into under this subchapter that conflicts with the   requirements of this subsection has no effect.          SECTION 2.  Section 2269.255, Government Code, is amended by   adding Subsections (c), (d), (e), (f), and (g) to read as follows:           (c)     Except as provided by Subsection (d), if the   governmental entity determines that the construction   manager-at-risk's bid or proposal provides the best value under   Subsection (b)(2) and that bid or proposal is selected, the   governmental entity shall compensate the construction   manager-at-risk for the performance of that work in the same manner   that the governmental entity would have compensated one of the   other competing trade contractors or subcontractors that submitted   a bid or proposal for the work, as determined by the governmental   entity.           (d)     If one or more bids or proposals received under this   section offer to provide services under a stipulated sum contract   and the construction manager-at-risk's bid or proposal is selected   as described by Subsection (c):                 (1)     the construction manager-at-risk shall be   compensated for the work in the manner that a stipulated sum   contract would provide; and                 (2)     the price proposed by the construction   manager-at-risk may not be audited.           (e)     A construction manager-at-risk's compensation for the   performance of work under Subsection (b) is considered an allowable   trade contractor or subcontractor cost for all purposes of the   construction contract, including for purposes of calculating the   construction manager-at-risk's fee.           (f)     For purposes of Subsection (d), a "stipulated sum   contract" is a contract in which the contractor agrees to provide   services for a fixed price resulting in the contractor bearing   substantial risk for any underestimated costs to provide the   services and is also known as a lump sum contract.           (g)     A provision of a request for proposals, an advertisement   for bids or proposals, or a construction contract entered into   under this subchapter that conflicts with the requirements of   Subsection (c), (d), or (e) has no effect.          SECTION 3.  Section 2269.307, Government Code, is amended by   amending Subsection (e) and adding Subsection (e-1) to read as   follows:          (e)   Except as provided by Subsection (e-1), the [ The ]   governmental entity may request additional information regarding   demonstrated competence and qualifications, considerations of the   safety and long-term durability of the project, the feasibility of   implementing the project as proposed, the ability of the offeror to   meet schedules, or costing methodology.  As used in this   subsection, "costing methodology" means an offeror's policies on   subcontractor markup, definition of general conditions, range of   cost for general conditions, policies on retainage, policies on   contingencies, discount for prompt payment, policies and pricing   for preventing and managing the risk of default by a trade   contractor or subcontractor, and expected staffing for   administrative duties. The term does not include a guaranteed   maximum price or bid for overall design or construction.           (e-1)     The governmental entity may not request a guaranteed   maximum price or bid for overall design or construction.          SECTION 4.  Subchapter G, Chapter 2269, Government Code, is   amended by adding Section 2269.3065 to read as follows:           Sec.   2269.3065.     PRICES AND METHODS FOR PREVENTING AND   MANAGING RISK OF DEFAULT BY TRADE CONTRACTOR OR SUBCONTRACTOR. (a)     Any request for proposals, request for qualifications, or   construction contract entered into under this subchapter must   clearly provide that:                 (1)     the selected design-build firm may implement the   firm's proposed methods of preventing and managing the risk of   default by a trade contractor or subcontractor; and                 (2)     the proposed prices for the methods described by   Subdivision (1) are allowable costs for all purposes of the   construction contract, including for purposes of calculating the   selected design-build firm's fee.           (b)     A provision of a request for proposals, a request for   qualifications, or a construction contract entered into under this   subchapter that conflicts with the requirements of Subsection (a)   has no effect.          SECTION 5.  Subchapter G, Chapter 2269, Government Code, is   amended by adding Section 2269.312 to read as follows:           Sec.   2269.312.     PERFORMANCE OF WORK. (a)   A contract entered   into under this subchapter must allow the design-build firm to   perform portions of the construction work required by the contract   instead of contracting with another person to perform that work.           (b)     The governmental entity may select the design-build   firm to perform portions of the construction work required by the   contract if:                 (1)     the design-build firm publicly advertises for bids   or proposals for the performance of the construction work required   by the contract;                 (2)     the design-build firm receives bids or proposals   from trade contractors or subcontractors for that work;                 (3)     the design-build firm submits a bid or proposal   for that work; and                 (4)     the governmental entity determines that the   design-build firm provides the best value for the governmental   entity.           (c)     Sections 2269.255(c), (d), (e), (f), and (g) apply to   the compensation of the design-build firm and the construction   contract entered into under this subchapter in the same manner as   those laws apply to a construction manager-at-risk's compensation   and a construction contract entered into under Subchapter F.           (d)     A provision of a request for proposals, an advertisement   for bids or proposals, or a construction contract entered into   under this subchapter that conflicts with this section has no   effect.          SECTION 6.  Subchapters F and G, Chapter 2269, Government   Code, as amended by this Act, apply only to a request for   qualifications or proposals first advertised on or after the   effective date of this Act.  A request for qualifications or   proposals first advertised before the effective date of this Act is   governed by the law in effect on the date the request for   qualifications or proposals was first advertised, and the former   law is continued in effect for that purpose.          SECTION 7.  This Act takes effect September 1, 2025.