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TITLE 34PUBLIC FINANCE
PART 1COMPTROLLER OF PUBLIC ACCOUNTS
CHAPTER 20TEXAS PROCUREMENT AND SUPPORT SERVICES
SUBCHAPTER CPROCUREMENT
RULE §20.38Preferences

(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 bidders.

    (A) A Texas 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 bidder by the same amount that a Texas 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 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 and Texas services.

    (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 and offered by a Texas Bidder 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.

    (D) Services offered by a Texas bidder shall be given preference if the services meet state requirements regarding the service to be performed and expected quality; and the cost of the service does not exceed the cost of other similar services of similar expected quality that are not offered by a Texas bidder.

  (3) 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) Recycled, remanufactured or environmentally sensitive products. A preference shall be given to recycled, remanufactured or environmentally sensitive products, including recycled steel products, if the products meet state specifications as to quantity and quality and defined best value factors. The preference for recycled steel products applies also to products purchased in connection with projects described in the Texas Government Code, §2166.003.

  (5) 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) 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) 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.

  (8) Products and services from economically depressed or blighted areas as defined in Texas Government Code, §2306.004 or that meet the definition of a historically underutilized business zone as defined by 15 U.S.C. §632(p). Preference shall be given to products from economically depressed or blighted areas if they meet state requirements as to quantity and quality, and are equal to or less than the cost of other products offered.

  (9) Products produced at a facility located on property for which the owner has received a certificate of completion under §361.609, Health and Safety Code, if the goods meet state specifications regarding quantity, quality, delivery, life cycle costs, and price.

  (10) Vendors that meet or exceed air quality standards.

    (A) For contracts to be performed, in whole or in part, in a designated nonattainment area or an affected county, as those terms are defined by §386.001, Health and Safety Code, the Commission and state agencies procuring goods and services may:

      (i) give preference to goods or services of a vendor that demonstrates that the vendor meets or exceeds any state or federal environmental standards, including voluntary standards, relating to air quality; or,

      (ii) require that a vendor demonstrate that the vendor meets or exceeds any state or federal environmental standards, including voluntary standards, relating to air quality.

    (B) The preference may be given only if the cost to the state for the goods and services would not exceed 105% of the cost of the goods or services provided by a vendor who does not meet the standards.

    (C) When this preference is made available, the methodology for claiming, evaluating and granting the preference shall be included in the Commission's and other state agencies' solicitations. The application of the preference should encourage vendor innovation to achieve the clean air objectives as described in the solicitation.


Source Note: The provisions of this §20.38 adopted to be effective April 20, 1993, 18 TexReg 2297; amended to be effective January 3, 1996, 20 TexReg 10993; amended to be effective December 3, 1997, 22 TexReg 11651; amended to be effective February 15, 2000, 25 TexReg 1096; amended to be effective September 11, 2000, 25 TexReg 8848; amended to be effective August 12, 2002, 27 TexReg 7083; amended to be effective January 7, 2004, 29 TexReg 77; transferred effective September 1, 2007, as published in the Texas Register July 6, 2007, 32 TexReg 4237

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