86R10257 MTB-F
	By: Capriglione	H.B. No. 2459

	A BILL TO BE ENTITLED
	AN ACT
	relating to oversight of and requirements applicable to information
	resources technology procurement by state agencies.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 2054.003(10), Government Code, is
	amended to read as follows:
	(10)  "Major information resources project" means:
	(A)  any information resources technology project
	identified in a state agency's biennial operating plan whose
	development costs exceed $5 [$1] million and that:
	(i)  requires one year or longer to reach
	operations status;
	(ii)  involves more than one state agency;
	or
	(iii)  substantially alters work methods of
	state agency personnel or the delivery of services to clients; and
	(B)  any information resources technology project
	designated by the legislature in the General Appropriations Act as
	a major information resources project.
	SECTION 2.  Section 2054.055(b), Government Code, is amended
	to read as follows:
	(b)  The report must:
	(1)  assess the progress made toward meeting the goals
	and objectives of the state strategic plan for information
	resources management;
	(2)  describe major accomplishments of the state or a
	specific state agency in information resources management;
	(3)  describe major problems in information resources
	management confronting the state or a specific state agency;
	(4)  provide a summary of the total expenditures for
	information resources and information resources technologies by
	the state;
	(5)  make recommendations for improving the
	effectiveness and cost-efficiency of the state's use of information
	resources;
	(6)  describe the status, progress, benefits, and
	efficiency gains of the state electronic Internet portal project,
	including any significant issues regarding contract performance;
	(7)  provide a financial summary of the state
	electronic Internet portal project, including project costs and
	revenues;
	(8)  provide a summary of the amount and use of
	Internet-based training conducted by each state agency and
	institution of higher education;
	(9)  provide a summary of agency and statewide results
	in providing access to electronic and information resources to
	individuals with disabilities as required by Subchapter M;
	(10)  assess the progress made toward accomplishing the
	goals of the plan for a state telecommunications network and
	developing a system of telecommunications services as provided by
	Subchapter H; and
	(11)  identify proposed major information resources
	projects for the next state fiscal biennium, including project
	costs through stages of the project and across state fiscal years
	from project initiation to implementation[;
	[(12)     examine major information resources projects
	completed in the previous state fiscal biennium to determine the
	performance of the implementing state agency, cost and value
	effectiveness, timeliness, and other performance criteria
	necessary to assess the quality and value of the investment; and
	[(13)     examine major information resources projects
	after the second anniversary of the project's completion to
	determine progress toward meeting performance goals and operating
	budget savings].
	SECTION 3.  Section 2054.1181, Government Code, is amended
	by amending Subsection (b) and adding Subsection (j) to read as
	follows:
	(b)  In performing its duties under this section, the
	department shall:
	(1)  develop policies for the additional oversight of
	projects required by Subsection (a);
	(2)  implement project management standards;
	(3)  use effective risk management strategies;
	(4)  establish standards that promote the ability of
	information resources systems to operate with each other; and
	(5)  use industry best practices and process
	reengineering when feasible.
	(j)  A state agency may not amend a contract subject to
	review under Section 2054.158(b)(4) if the contract is at least 10
	percent over budget or the associated major information resources
	project is at least 10 percent behind schedule unless the agency:
	(1)  conducts a cost-benefit analysis with respect to
	canceling or continuing the project; and
	(2)  submits the analysis described by Subdivision (1)
	to the quality assurance team.
	SECTION 4.  Section 2054.158, Government Code, is amended by
	amending Subsection (b) and adding Subsections (d) and (e) to read
	as follows:
	(b)  The quality assurance team shall:
	(1)  develop and recommend policies and procedures to
	improve the development, implementation, and return on investment
	for state agency information resources technology projects;
	(2)  except as provided by Subsection (e), review a
	state agency's business case prepared for a major information
	resources project under Section 2054.303 and make recommendations
	[develop and recommend procedures] to improve the implementation of
	the project [state agency information resources technology
	projects by including considerations for best value and return on
	investment]; [and]
	(3)  provide annual training for state agency
	procurement and contract management staff on best practices and
	methodologies for information technology contracts;
	(4)  review and provide recommendations on the final
	negotiated terms of a contract for the development or
	implementation of a major information resources project with a
	value of at least $10 million; and
	(5)  provide a report to the governor, lieutenant
	governor, speaker of the house of representatives, and presiding
	officer of the standing committee of each house of the legislature
	with primary jurisdiction over appropriations by December 1 of each
	even-numbered year that includes:
	(A)  the performance indicator report required by
	Section 2054.159(a);
	(B)  a summary of any major issues identified in
	state agency reports submitted under Section 2054.159(f);
	(C)  an appendix containing any justifications
	submitted to the quality assurance team under Section 2054.160(d);
	and
	(D)  any additional information considered
	appropriate by the quality assurance team.
	(d)  The comptroller by rule shall develop guidelines for the
	additional or reduced monitoring of major information resources
	projects and associated contracts of state agencies based on the
	risk criteria developed under Section 2155.091(f).
	(e)  The quality assurance team may waive the review
	authorized by Subsection (b)(2) for a project that the team
	determines to be low risk.
	SECTION 5.  Section 2054.159, Government Code, is amended by
	amending Subsection (b) and adding Subsections (f) and (g) to read
	as follows:
	(b)  The department by rule shall develop the performance
	indicators the quality assurance team is required to monitor under
	Subsection (a) and obtain the approval of each member of the quality
	assurance team for the performance indicators. In adopting rules
	under this subsection, the department shall consider applicable
	information technology industry standards.
	(f)  For each major information resources project, a state
	agency shall provide the quality assurance team any verification
	and validation report or quality assurance report related to the
	project not later than the 10th day after the date the agency
	receives a request for the report.
	(g)  The quality assurance team may request any information
	necessary to determine a major information resources project's
	potential risk.
	SECTION 6.  Subchapter G, Chapter 2054, Government Code, is
	amended by adding Section 2054.160 to read as follows:
	Sec. 2054.160.  REVIEW OF CONTRACT FOR MAJOR INFORMATION
	RESOURCES PROJECT. (a) For each contract for the development or
	implementation of a major information resources project with a
	value of at least $10 million, a state agency shall:
	(1)  submit the proposed terms of the contract to the
	quality assurance team before the start of negotiations; and
	(2)  submit the final negotiated unsigned contract to
	the quality assurance team for review under Section 2054.158(b)(4).
	(b)  After the quality assurance team makes a recommendation
	under Section 2054.158(b)(4), a state agency shall:
	(1)  comply with the recommendation; or
	(2)  submit to the quality assurance team a written
	explanation regarding why the recommendation is not applicable to
	the contract under review.
	(c)  Before amending a contract related to a major
	information resources project, a state agency must notify the
	governor, lieutenant governor, speaker of the house of
	representatives, presiding officer of the standing committee of
	each house of the legislature with primary jurisdiction over
	appropriations, and quality assurance team if:
	(1)  the total value of the amended contract exceeds or
	will exceed the initial contract value by 25 percent or more; or
	(2)  the amendment requires the contractor to provide
	consultative services, technical expertise, or other assistance in
	defining project scope or deliverables.
	(d)  A state agency shall provide to the quality assurance
	team a justification for an amendment subject to Subsection (c).
	SECTION 7.  Section 2054.301, Government Code, is amended to
	read as follows:
	Sec. 2054.301.  APPLICABILITY[; DEFINITION]. [(a)]  This
	subchapter applies only to[:
	[(1)]  a major information resources project[; and
	[(2)  a major contract].
	[(b)     In this subchapter, "major contract" means a major
	contract as defined by Section 2262.001(4) under which a vendor
	will perform or manage an outsourced function or process.]
	SECTION 8.  Section 2054.302, Government Code, is amended by
	amending Subsection (b) and adding Subsection (d) to read as
	follows:
	(b)  The department[, in consultation with the Legislative
	Budget Board and state auditor's office,] shall develop and provide
	guidelines and forms for the documents required by this subchapter.
	(d)  The guidelines and forms developed under Subsection (b)
	must be approved by each member of the quality assurance team.
	SECTION 9.  Section 2054.303, Government Code, is amended by
	amending Subsections (a) and (c) and adding Subsection (d) to read
	as follows:
	(a)  For each proposed major information resources project
	[or major contract], a state agency must prepare:
	(1)  a business case providing the initial
	justification for the project [or contract, including the
	anticipated return on investment in terms of cost savings and
	efficiency for the project or contract]; and
	(2)  if the state agency meets the low risk criteria
	developed under Section 2155.091(f):
	(A)  a statewide impact analysis of the project's
	[or contract's] effect on the state's common information resources
	infrastructure[, including the possibility of reusing code or other
	resources]; and
	(B) [(3)  in consultation with the department,] a
	technical architectural assessment of the project, if requested by
	the quality assurance team [or contract].
	(c)  The department shall use the analysis to ensure that the
	proposed project [or major contract] does not unnecessarily
	duplicate existing statewide information resources technology.
	(d)  After the quality assurance team makes a recommendation
	relating to a business case under Section 2054.158(b)(2), a state
	agency shall:
	(1)  comply with the recommendation; or
	(2)  submit to the quality assurance team a written
	explanation regarding why the recommendation is not applicable to
	the project under review.
	SECTION 10.  Sections 2054.304(a) and (b), Government Code,
	are amended to read as follows:
	(a)  A state agency shall develop a project plan for each
	major information resources project [or major contract].
	(b)  The [Except as provided by Subsection (c), the] state
	agency must file the project plan with the quality assurance team
	and the department before the agency[:
	[(1)]  spends more than 10 percent of allocated funds
	for the project [or major contract; or
	[(2)     first issues a vendor solicitation for the
	project or contract].
	SECTION 11.  Section 2054.305, Government Code, is amended
	to read as follows:
	Sec. 2054.305.  PROCUREMENT PLAN AND METHOD FOR MONITORING
	CONTRACTS. Before issuing a [vendor] solicitation for a [project
	or major] contract subject to review under Section 2054.158(b)(4),
	the state agency must develop, consistent with any acquisition plan
	provided in the guide developed under Section 2262.051 [department
	guidelines]:
	(1)  a procurement plan with anticipated service levels
	and performance standards for each contractor [vendor]; and
	(2)  a method to monitor changes to the scope of each
	contract.
	SECTION 12.  Section 2054.307, Government Code, is amended
	to read as follows:
	Sec. 2054.307.  APPROVAL OF DOCUMENTS AND CONTRACT CHANGES.
	(a)  A state agency's executive director, or the executive
	director's designee, [information resources manager, designated
	project manager, and the agency employee in charge of information
	security for the agency] must approve [and sign]:
	(1)  each document required by this subchapter; and
	(2)  if the department requires the approval [and
	signatures], any other document related to this subchapter.
	(b)  The state agency's executive director must approve a
	proposed contract amendment or change order for a major information
	resources project if the amendment or change order:
	(1)  changes the monetary value of the contract by more
	than 25 [10] percent; or
	(2)  significantly changes the completion date of the
	contract.
	SECTION 13.  Section 2155.091, Government Code, is amended
	by adding Subsection (f) to read as follows:
	(f)  The chief procurement officer, in coordination with the
	Contract Advisory Team created under Section 2262.101 and the
	quality assurance team created under Section 2054.158,
	shall develop criteria for the assessment of a state agency as
	"high risk," "standard risk," or "low risk" in relation to major
	information resources projects and associated contracts. In this
	subsection, "major information resources project" has the meaning
	assigned by Section 2054.003.
	SECTION 14.  The following provisions of the Government Code
	are repealed:
	(1)  Section 2054.1181(f);
	(2)  Sections 2054.1183 and 2054.1184;
	(3)  Sections 2054.159(c) and (d); and
	(4)  Section 2054.304(c).
	SECTION 15.  As soon as practicable after the effective date
	of this Act, the comptroller of public accounts, the Department of
	Information Resources, and each affected state agency as necessary,
	shall adopt the rules, processes, and procedures and take the
	actions necessary to implement the changes in law made by this Act.
	SECTION 16.  This Act applies only in relation to a contract:
	(1)  for which a state agency first advertises or
	otherwise solicits bids, proposals, offers, or qualifications on or
	after the effective date of this Act;
	(2)  that is extended or modified on or after the
	effective date of this Act; or
	(3)  for which a change order is submitted on or after
	the effective date of this Act.
	SECTION 17.  This Act takes effect September 1, 2019.