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Texas Senate Bill 1588 Contracts over $50,000

Started by JackieM7 • 6 replies • 332 views

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JackieM7 (Texas)
Posts: 2
Posted:
The wording in the bill saves that contracts "services" over $50,000 must go through a bid process with a min of 3 bids being solicited. Has anyone had experience with this? Is it possible this would include purchases and not just services? I've seen several articles from different sources that say "contracts" and leave out the word services. Our board voted to include an $84,000 purchase in the 2024 budget, the membership is not happy and there is a lot of noise about taking steps to remove board members, so they went ahead and made the purchase this year. This is causing a lot of discourse. Thank you.
ElleN (Idaho)
Posts: 4,420
Posted:
Quote:
Posted By JackieM7 on 11/04/2023 2:31 PM
The wording in the bill saves that contracts "services" over $50,000 must go through a bid process with a min of 3 bids being solicited. Has anyone had experience with this? Is it possible this would include purchases and not just services? I've seen several articles from different sources that say "contracts" and leave out the word services. Our board voted to include an $84,000 purchase in the 2024 budget, the membership is not happy and there is a lot of noise about taking steps to remove board members, so they went ahead and made the purchase this year.
Texas statute TPC 209 says this about contracts:

an association that proposes to contract for services that will cost more than $50,000 shall solicit bids or proposals using a bid process established by the association.

I do not include this things that are not services.

In general, if the board bought something that the covenants do not address, this is a problem.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
Jackie

What did they buy?
CathyA3 (Ohio)
Posts: 6,299
Posted:
I have an issue with a bill *requiring* a certain number of bids. There may be good reasons for getting fewer - for instance, few vendors in the area offer a particular service. Getting bids from companies that aren't serious prospects just wastes everyone's time and money.

And there's the problem with the word "services" if it's not defined in the bill. "Contracts" is also a problem, because legally the word covers a huge array of financial transactions. Anytime you buy something, an implicit contract is formed. This is one reason there are lists of ingredients and allergy info on food products, and why companies frantically recall food that may contain an ingredient that didn't appear on the label.

Oh well, at least the lawyers will be gainfully employed...
BillH10 (Texas)
Posts: 1,217
Posted:
Cathy, the three bids must be solicited but not necessarily obtained. If only two potential bidders respond with a bid, or a no bid response is received, the solicitation requirement has been met. Good documentation must be kept however.

I do not recall the impetus for this bill, perhaps one of my fellow Texas contributors has a better memory. It has been my experience some of what is introduced regarding HOAs when the Legislature is in session is the result of influential constituents strong-arming the local legislator over some relatively trivial issue, real or imagined--it depends on whose long horn steer has been gored.

Our legislature meets every other year. Every regular session an enthusiastic legislator introduces a bill to dissolve HOAs and condo associations. Once the ramifications are explained, he or she calms down.
BillH10 (Texas)
Posts: 1,217
Posted:
Cathy, the three bids must be solicited but not necessarily obtained. If only two potential bidders respond with a bid, or a no bid response is received, the solicitation requirement has been met. Good documentation must be kept however.

I do not recall the impetus for this bill, perhaps one of my fellow Texas contributors has a better memory. It has been my experience some of what is introduced regarding HOAs when the Legislature is in session is the result of influential constituents strong-arming the local legislator over some relatively trivial issue, real or imagined--it depends on whose long horn steer has been gored.

Our legislature meets every other year. Every regular session an enthusiastic legislator introduces a bill to dissolve HOAs and condo associations. Once the ramifications are explained, he or she calms down.
JackieM7 (Texas)
Posts: 2
Posted:
An 84,000 tractor to mow the right of way. Not saying the tractor was a bad idea, but it is a very large purchase that no one knew about except 6 or 7 people. They did a 7 year note, budgeted for 2024. Then we the owners started asking question, they went ahead and bought it. My biggest concern is the liability situation they put the neighborhood in. If someone gets hurt or they do damage the poa is liable. Just a lot of un answered questions.

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