Untitled Texas Attorney General Opinion ( 2014 )

ATTORNEY GENERAL OF TEXAS
GREG ABBOTT
December 1, 2014
The Honorable Craig Watkins Opinion No. GA-l 090
Dallas County District Attorney
411 Elm Street, 5th Floor Re: Authority of Dallas County, under Labor
Dallas, Texas 75202 Code section 62.0515 and the County
Purchasing Act, to require payment of a wage
higher than the state-mandated minimum wage
to employees of county contractors
(RQ-1203-GA)
Dear Mr. Watkins:
You ask whether "Dallas County [is] expressly authorized to require a living wage be paid
on contracts awarded pursuant to the County Purchasing Act." 1 In the alternative, you ask whether
Dallas County (the "County") has "implied authority under the County Purchasing Act to include
payment of living wages as a factor in a request for competitive proposals." Request Letter at 1.
"[T]he authority of the Commissioner's Court as the governing body of the county to make
contracts in behalf of the county is limited to that conferred either expressly or by necessary
implication by the constitution and laws of this state." Jack v. State, 694 S.W.2d 391, 397 (Tex.
App.-San Antonio 1985, writ refd n.r.e.). The County Purchasing Act (the "Act"), Local
Government Code chapter 262, subchapter C, requires that counties make certain purchases using
competitive bidding, which obliges the commissioners court to "(1) award the contract to the
responsible bidder who submits the lowest and best bid; or (2) reject all bids and publish a new
notice." TEX. Loc. Gov'T CODE ANN. § 262.027(a) (West Supp. 2014); see generally id.
§§ 262.021-.037 (West 2005 & Supp. 2014). The Act also authorizes alternative competitive
procedures beyond traditional competitive bidding, such as the competitive proposal process
outlined in section 262.030, about which you ask. 2 See Request Letter at 1. The Act does not
1
Letter from Honorable Craig Watkins, Dallas Cnty. Dist. Att'y, to Honorable Greg Abbott, Tex. Att'y Gen. at
(June 3, 2014), http://www.texasattomeygeneral.gov/opin ("Request Letter"). By "living wage," you mean that
"contractors would [be required to] pay employees who work on county projects awarded under Texas Local
Government Code section 262.[0]30 at least $10.25 per hour." !d. at 2.
2
Section 262.030 authorizes a competitive proposal procedure when a county purchases certain goods and
services and when a county purchasing agent determines, with commissioners court consent, that the use of an
(continued ... )
The Honorable Craig Watkins - Page 2 (GA-1090)
expressly authorize a county to require higher wages in its solicitation for proposals under section
262.030. See TEX. Loc. Gov'T CODE ANN. § 262.030 (West Supp. 2014). You first ask whether
section 62.0515(c) of the Labor Code supplies such express authorization. Request Letter at 1.
Chapter 62 of the Labor Code requires employers to pay employees at least the minimum
wage established under the Fair Labor Standards Act of 1938. TEX. LAB. CODE ANN. § 62.051
(West 2006). Section 62.0515 provides that this minimum wage requirement "supersedes a wage
established in an ordinance, order, or charter provision governing wages in private employment,
other than wages under a public contract," except as otherwise provided. !d. § 62.0515(a). Section
62.0515 does not apply "to a minimum wage established by a governmental entity that applies to a
contract .. . entered into by a governmental entity and a private entity." !d. § 62.0515(c). 3 A
private entity that enters into such a contract and agrees to comply with a minimum wage
established by the governmental entity "is subject to the terms of that contract." !d. You contend
that this enforcement provision "expressly authorizes a county to solicit and evaluate competitive
proposals based upon a private entity's agreement to pay its workers more than the state-mandated
minimum wage." Request Letter at 3.
Section 62.0515 acknowledges other statutory schemes ·through which the Legislature has
authorized a deviation from the state minimum wage requirement. See, e.g., TEX. Gov' T CODE
ANN.§§ 2258.021-.022 (West 2008) (requiring that public works construction employees be paid at
least the general prevailing rate of per diem wages in the locality). Section 62.0515 is applicable in
situations in which the Legislature has specifically authorized such a departure. But section
62.0515 does not itself provide an explicit grant of authority for a county to require a contractor to
pay its workers a higher wage. 4 Other provisions of the Act suggest that when the Legislature
intends to authorize a county to require bidders to comply with a specific requirement, it knows how
to do so. See, e.g., TEX. Loc. Gov'T CoDE ANN. §§ 262.025(d) (West Supp. 2014) (authorizing
certain commissioners courts to "require that a minimum of 25 percent of the work be performed by
the bidder"), 262.027(f) (permitting commissioners to "condition acceptance of a bid on compliance
with a requirement for attendance at a mandatory pre-bid conference under Section 262.0256"); see
also FM Props. Operating Co. v. City ofAustin, 22 S.W.3d 868, 884-85 (Tex. 2000) (relying on the
principle of statutory construction that the Legislature knows how to enact a law effectuating its
alternative competitive proposal procedure "is in the best interest of the county." TEX. Loc. Gov'T CODE ANN.
§ 262.030(d) (West Supp. 2014).
3
For purposes of section 62.0515, the term "governmental entity" includes a county. TEX. LAB. CODE ANN.
§ 62.0515(d) (West 2006).
4
In an analogous situation, this office considered whether a school district could require outside contractors to
pay their workers a higher wage than was otherwise mandated by a prevailing wage statute. See Tex. Att'y Gen. Op.
No. JC-0011 (1999) (construing chapter 2258 of the Government Code, app licable to public works construction
contracts). Although the statute provided that the payment of higher wages to a worker employed on a public work was
not prohibited, this office nonetheless concluded that the statute did not expressly authorize the school district to require
a contractor to pay a higher wage. Id at 3.
The Honorable Craig Watkins - Page 3 (GA-1090)
intent). Thus, a court would likely conclude that section 62.0515 of the Labor Code does not
expressly authorize a county to require a higher wage as a condition for an award of the contract.
In your second question, you suggest in the alternative that section 262.030 of the Act
necessarily implies the authority to include a higher wage as one of several proposal evaluation
factors, to which the county would assign a relative value. Request Letter at 3; see TEX. Loc.
Gov'T CODE ANN. § 262.030 (West Supp. 2014). A request for proposals under section 262.030
must specify the relative importance of price and other evaluation
factors. The award of the contract shall be made to the responsible
offeror whose proposal is determined to be the lowest and best
evaluated offer resulting from negotiation, taking into consideration
the relative importance of price and other evaluation factors set forth
in the request for proposals.
TEX. Loc. Gov'T CODE ANN.§ 262.030(b) (West Supp. 2014). The term "lowest and best" means
an "offer providing the best value considering associated direct and indirect costs, including
transport, maintenance, reliability, life cycle, warranties, and customer service after a sale." ld.
§ 262.022(5-a). Thus, in evaluating bids under section 262.030, the commissioners court must
consider the "best value" to the county and the "associated direct and indirect costs," for which the
evaluation factors developed by the commissioners court serve as a benchmark. ld.
You suggest that "including a living wage as an evaluation factor in competitive proposals
would result in workers who are more highly qualified and thus more competent, and that this will
improve the quality of the work provided." Request Letter at 3. The Texas Supreme Court has
explained that the main purpose of the competitive bidding statutes is
to stimulate competition ... and secure the best work and materials at
the lowest practicable price, for the best interests and benefit of the
taxpayers and property owners. There can be no competitive bidding
in a legal sense where the terms of the letting of the contract prevent
or restrict competition ... or increase the cost of the work or of the
materials or other items going into the project.
Tex. Highway Comm'n v. Tex. Ass 'n ofSteellmps., Inc., 372 S.W.2d 525,527 (Tex. 1963) (citation
omitted). The Court has also recognized the authority of a state agency to specify the quality of
materials sought, stating that "[m]atters of quality should be fixed by quality specifications and not
by proscriptions" that are indirect. ld. at 529. Based on these principles, this office has previously
concluded that bid specifications must have a "definite and objective relationship to matters of
quality and competence" or be "adopted pursuant to clear legislative authority." See Tex. Att'y
Gen. Op. Nos. JC-0521 (2002) at 5, JC-0223 (2000) at 8, DM-113 (1992) at 7. Whether the
payment of higher wages is definitively and objectively related to the quality of services provided
under any particular contract, such that it can be included as an evaluation factor on competitive
proposals submitted under section 262.030 of the Act, requires a factual inquiry and is not a
question that can be answered in the opinion process. Tex. Att'y Gen. Op. No. GA-1050 (2014) at
2 (explaining that this office is not authorized to perform factual inquiries).
The Honorable Craig Watkins - Page 4 (GA-1090)
SUMMARY
A court would likely conclude that Dallas County is not
expr ssly authorized by section 62.0515 of the Labor ode to require
a higher wage as a condition for a contract award under the County
Purchasing Act. Whether the payment f higher wages is definitively
and objectively related to the quality of servic s provided under a
specific contract such that it can be included as an valuation factor
on competiti e proposals s.ubmirted under section 262.030 of the Act
requires a factual inquiry and is not a question that can be answered in
the opinion process.
Attorney General ofTexas
DANIEL T. HODGE
First Assistant Attorney General
JAMES D. BLACKLOCK
Deputy Attorney General for Legal Counsel
VIRGINIA K. HOELSCHER
Chair, Opinion Committee
Becky P. Casares
Assistant Attorney General, Opinion Committee