HBA-BSM H.B. 852 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 852
By: McClendon
State Affairs
3/7/2001
Introduced



BACKGROUND AND PURPOSE 

Reverse auctions are a form of competitive bidding whereby the buyer
announces the product it wants to buy and prospective sellers bid against
each other for the lowest offering price.  The Internet makes  real time
reverse auctions possible, allowing prospective sellers to enter continuous
bids over a period of several hours until the lowest bid is reached.
However, in December 2000, the attorney general issued an opinion stating
that the General Services Commission (GSC) may not purchase goods and
services through reverse auctions without specific statutory authority to
do so.  House Bill 852 authorizes GSC to purchase goods and services using
this method. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 852 amends the Government and Local Government codes to include
the reverse auction procedure as an option that the General Services
Commission (GSC) may use when purchasing goods or services.  The bill also
authorizes local governments to participate in GSC purchases that use the
reverse auction procedure. The bill authorizes a local government to use
the reverse auction procedure in purchasing goods and services in place of
any other method that would otherwise apply to the purchase. A local
government that uses the reverse auction procedure must include in the
procedure a notice provision and other provisions necessary to produce a
method of purchasing that is advantageous to the local government and fair
to the vendors.  

EFFECTIVE DATE

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001.