Sec. 370.308. PERFORMANCE AND PAYMENT SECURITY. (a) Notwithstanding Section 223.006 and the requirements of Subchapter B, Chapter 2253, Government Code, an authority shall require a private entity entering into a comprehensive development agreement under Section 370.305 to provide a performance and payment bond or an alternative form of security in an amount sufficient to:
(1) ensure the proper performance of the agreement; and
(2) protect:
(A) the authority; and
(B) payment bond beneficiaries who have a direct contractual relationship with the private entity or a subcontractor of the private entity to supply labor or material.
(b) A performance and payment bond or alternative form of security shall be in an amount equal to the cost of constructing or maintaining the project.
(c) If an authority determines that it is impracticable for a private entity to provide security in the amount described by Subsection (b), the authority shall set the amount of the bonds or the alternative forms of security.
(d) A payment or performance bond or alternative form of security is not required for the portion of an agreement that includes only design or planning services, the performance of preliminary studies, or the acquisition of real property.
(e) The amount of the payment security must not be less than the amount of the performance security.
(f) In addition to performance and payment bonds, an authority may require the following alternative forms of security:
(1) a cashier's check drawn on a financial entity specified by the authority;
(2) a United States bond or note;
(3) an irrevocable bank letter of credit; or
(4) any other form of security determined suitable by the authority.
(g) An authority by rule shall prescribe requirements for alternative forms of security provided under this section.
Added by Acts 2003, 78th Leg., ch. 1325, Sec. 2.01, eff. June 21, 2003.
Structure Texas Statutes
Subtitle G - Turnpikes and Toll Projects
Chapter 370 - Regional Mobility Authorities
Subchapter G. Participation in Financing, Construction, and Operation of Transportation Projects
Section 370.301. Department Contributions to Turnpike Projects
Section 370.302. Agreements to Construct, Maintain, and Operate Transportation Projects
Section 370.303. Agreements Between Authority and Governmental Entities
Section 370.304. Additional Agreements of Authority
Section 370.305. Comprehensive Development Agreements
Section 370.306. Process for Entering Into Comprehensive Development Agreements
Section 370.307. Confidentiality of Negotiations for Comprehensive Development Agreements
Section 370.308. Performance and Payment Security
Section 370.309. Ownership of Transportation Projects
Section 370.310. Liability for Private Obligations
Section 370.311. Terms of Private Participation
Section 370.312. Rules, Procedures, and Guidelines Governing Negotiating Process
Section 370.313. Participation on Certain Other Boards, Commissions, or Public Bodies