Contracting Reform Bill Sails Out of Senate Committee

^{*Editor's note: This story has been updated throughout.}

Amid an ongoing scandal over how the state awarded a multimillion-dollar contract to a private company, the Senate Finance Committee on Thursday approved a bill that would overhaul the state’s contracting processes.

Senate Bill 20 by committee chairwoman Jane Nelson, R-Flower Mound, would require state agencies to record their contracts with outside vendors in a database run by the comptroller’s office. It would also prohibit state agencies from signing contracts with former state employees for two years after they left their post at the state — an attempt to limit the revolving door between the private sector and state government.

The legislation would also cap at $1 million contracts awarded through the state’s Cooperative Contracts program, which is used to purchase computer products and services. The program, run by the Department of Information Resources, has spurred investigations and allegations of corruption after the Health and Human Service Commission used it in 2012 to sign a $20 million contract with little-known Austin software maker 21CT.

“We need to get a firm handle on contracting across state government, not only because they involve taxpayer dollars but because the delivery of services depends on it,” Nelson said in a statement.

The measure now goes to the full Senate.

Also Thursday, officials from the state's four largest agencies — including the Health and Human Services Commission — updated a House committee on their oversight of contracts.

Ron Pigott, the commission's new deputy executive commissioner of procurement, touted several reforms put in place before he arrived in February, but after the agency's inspector general and chief counsel were forced to resign amid questions about the 21CT contract. Pigott told the House Committee on Investigating and Ethics that the commission has added a new ethics officer and now requires more top staff to review contracts before they are awarded.

And the agency will no longer award contracts without a competitive bidding process, he said. The commission secured $18 million from the federal government for the 21CT deal after telling the Centers for Medicare and Medicaid Services the company competed for the work. They did not. 

"We're going out and getting bids from everybody," Pigott said.

Terri Langford contributed to this report.