TITLE social-services-and-assistance




40 TAC §§106.55 - 106.60

The Texas Rehabilitation Commission (TRC) proposes a new Subchapter F, §§106.55-106.60, concerning resolution of certain contract claims against the state--negotiation of claim.

The new sections are proposed to implement the provisions of the Government Code, Chapter 2260.

Charles E. Harrison, Jr., Deputy Commissioner for Financial Services, has determined that for the first five-year period the sections are in effect, there will be no fiscal implications for state or local government.

Mr. Harrison also has determined that for each year of the first five years the sections are in effect the public benefit anticipated as a result of enforcing the sections will be the enforcement of new rules regarding resolution of certain contract claims against the state. There will be no effect on small businesses. There is no anticipated economic cost to persons who are required to comply with the sections as proposed.

Comments on the proposal may be submitted to Roger Darley, Assistant General Counsel, Texas Rehabilitation Commission, 4900 North Lamar Boulevard, Suite 7300, Austin, Texas 78751.

The new sections are proposed under the Texas Human Resources Code, Title 7, Chapter 111, §111.018 and §111.023, which provides the Texas Rehabilitation Commission with the authority to promulgate rules consistent with Title 7, Texas Human Resources Code.

No other statute, article, or code is affected by this proposal.

§106.55. Claim for Breach of Contract; Notice.


In accordance with Government Code, Chapter 2260, Subchapter B, a contractor may make a claim against the commission for breach of a contract between the commission and the contractor. The commission may assert a counterclaim against the contractor.


A contractor must provide written notice to the commission of a claim for breach of contract not later than the 180th day after the date of the event giving rise to the claim.


The notice must state with particularity:


the nature of the alleged breach;


the amount the contractor seeks as damages; and


the legal theory of recovery.


The commission must assert, in a writing delivered to the contractor, any counterclaim not later than the 90th day after the date of notice under this subsection. If the commission does not comply with this subsection it waives the right to assert the counterclaim.

§106.56. Negotiation.


The Associate Commissioner for buyer Support Services shall examine the claim and any counterclaim and negotiate with the contractor in an effort to resolve them. Except as provided by subsection (b) of this section, the negotiation must begin not later than the 60th day after the later of:


the date of termination of the contract;


the completion date in the original contract; or


the date the claim is received.


The commission is entitled to delay the beginning of negotiation until after the 180th day after the date of the event giving rise to the claim.

§106.57. Partial Resolution of Claim.


If the negotiation under §106.56 of this title (relating to Negotiation) results in the resolution of some disputed issues by agreement or in a settlement, the parties shall reduce the agreement or settlement to writing and each party shall sign the agreement or settlement.


A partial settlement or resolution of a claim does not waive a party's rights under this chapter as to the parts of the claim that are not resolved.

§106.58. Payment of Claim from Appropriated funds.

The commission may pay a claim resolved in accordance with this subchapter only from money appropriated to it for payment of contract claims or for payment of the contract that is the subject of the claim. If money previously appropriated for payment of contract claims or payment of the contract is insufficient to pay the claim or settlement, the balance of the claim may be paid only from money appropriated by the legislature for payment of the claim.

§106.59.Incomplete Resolution.

If a claim is not entirely resolved under §106.56 of this title (relating to Negotiation) on or before the 270th day after the date the claim is filed with the commission, unless the parties agree in writing to an extension of time, the contractor may file a request for a hearing under Government Code, Chapter 2260, Subchapter C.

§106.60. Mediation.


Before the 270th day after the date the claim is filed with the commission and before the expiration of any extension of time under §106.59 of this title (relating to Incomplete Resolution), the parties may agree to mediate the claim made under this subchapter.


Participation in mediation shall be voluntary on the part of the commission and the contractor.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State, on December 27, 1999.


Charles Schiesser

Chief of Staff

Texas Rehabilitation Commission

Earliest possible date of adoption: February 6, 2000

For further information, please call: (512) 424-4050