Non-resident Bidder and Texas Preference
General
Similar to the requirements described in the “Local Hiring Preference” provisions stated above, federal laws do not allow states to provide a bidding preference for resident bidders for federal-aid contracts.
For state-funded projects, the Legislature enacted a statute regarding non-resident bidders.
states:
“A governmental entity may not award a governmental contract to a non-resident bidder unless the non-resident underbids the lowest bid submitted by a responsible resident bidder by an amount that is not less than the greater of the following: (1) the amount by which a resident bidder would be required to underbid the non-resident bidder to obtain a comparable contract in the state in which the non-resident's principal place of business is located; or (2) the amount by which a resident bidder would be required to underbid the nonresident bidder to obtain a comparable contract in the state in which a majority of the manufacturing relating to the contract will be performed.”
TxDOT refers to this law as the “reciprocity requirement.” Information about states with bidding preference laws may be obtained from the Texas Comptroller of Public Accounts Office, including a
.
Federal Requirements
- – Prohibits any procedures prohibiting consideration of a bid by any responsible contractor, whether a resident or non-resident of a state in which the work will be performed.
- – Prohibits, for design-build projects, any procedures giving geographical preference in the selection process.
State Requirements
- – Prohibits governmental entities from awarding a contract to a non-resident bidder unless the non-resident bidder underbids the lowest resident bidder by a reciprocal percentage.
Required Practices
The LG must follow the requirements of federal and state statutes with respect to state hiring preferences as described in the
.