About this walkthrough
Texas spells out job order contracting in its own short section of state law. If you work for a Texas city, county, school district, or state agency, or you bid on their work, these eleven sections set the ground rules. They live in Texas Government Code Chapter 2269, Subchapter I, sections 2269.401 through 2269.411. This page walks through them in plain English. It is not legal advice, so check the current statute and your own attorney before you rely on any of it.[1]
Who the law applies to
Chapter 2269 covers public work contracts made by Texas governmental entities. The chapter lists state agencies (including the Texas Facilities Commission), counties, municipalities, school districts, special districts such as hospital districts and water districts, other political subdivisions, and public junior colleges.[1]
How Texas defines job order contracting
Section 2269.401 defines job order contracting as a procurement method for maintenance, repair, alteration, renovation, remediation, or minor construction of a facility "when the work is of a recurring nature but the delivery times, type, and quantities of work required are indefinite." That is the same idea covered in our guide to what job order contracting is: one competitively awarded contract that handles a steady stream of smaller projects you cannot fully predict at the start.[1]
Buildings only, not civil work
Scope is the first thing to check. Section 2269.402 says the JOC subchapter applies only to a building whose design and construction is governed by building codes, or to a structure or land associated with a building.[1]
It does not apply to:
- highways, roads, streets, and bridges
- utilities, water supply projects, water plants, and wastewater plants
- water and wastewater distribution or conveyance facilities
- wharves, docks, and airport runways or taxiways
- drainage projects and similar civil engineering construction
- a building or structure that is only incidental to a project that is mainly civil engineering
The conditions for using it
Under section 2269.403, an entity may award job order contracts when two things are true: the work recurs but the delivery times are indefinite, and indefinite quantities and orders are awarded substantially on the basis of tasks that are described and priced in advance.[1]
Two more rules come with that section. The entity has to set the maximum aggregate contract price when it advertises. And the governing body (the council, commissioners court, or board) must approve each job, task, or purchase order over $500,000.
How prices are set
Section 2269.404 gives two ways to set contract unit prices:[1]
- Name one or more published construction unit price books and the divisions or line items that apply.
- Provide a list of work items and have offerors propose one or more coefficients or multipliers to apply to the price book or the prepriced items. That proposed coefficient is the price proposal.
How the contract is procured and awarded
Section 2269.405 lets an entity use the competitive sealed proposal method from elsewhere in the chapter. The entity advertises for, receives, and publicly opens sealed proposals. It may also ask for more than rates, including experience, past performance, proposed personnel, and methodology. Our guide to evaluating a JOC solicitation covers how those pieces usually show up in a request for proposals.[1]
Section 2269.406 allows award to one or more job order contractors from each solicitation, so a single procurement can produce more than one contract.
Who else can use the contract
Section 2269.407 says a job order contract can be used only for the entity that awarded it, with two exceptions: the solicitation and the contract both specifically allow use by others, or the entity signs an interlocal agreement that provides otherwise.[1]
Architects and engineers
If a contract or an order needs work that counts as the practice of architecture or engineering under Texas licensing law, section 2269.408 requires the entity to select or designate an architect or engineer to prepare the construction documents. There is a narrow exception for industrialized housing, industrialized buildings, and relocatable educational facilities approved under Chapter 1202 of the Occupations Code, when the contractor uses an architect or engineer who approves the documents.[1]
How long a contract can run
Section 2269.409 caps the base term at two years. The entity may renew annually for up to three more years, so five years at most.[1]
What a job order looks like
Each order has to be signed by the entity's representative and the contractor, under section 2269.410. The order can be either a fixed price, lump-sum order based substantially on contract unit pricing applied to estimated quantities, or a unit price order based on the quantities and line items actually delivered. For the day-to-day steps, see our guide to how job orders work.[1]
Bonds
Section 2269.411 says the contractor provides payment and performance bonds, if required by law, based on the amount or estimated amount of each order. The thresholds that decide when bonds are required sit in a different chapter of the Government Code.[1]
Quick reference
[1]| Topic | Section | Rule |
|---|---|---|
| Definition | 2269.401 | Recurring work, indefinite timing, type, and quantity |
| Scope | 2269.402 | Buildings and associated structures or land; no civil engineering projects |
| Price cap and approvals | 2269.403 | Max aggregate price set at advertising; governing body approves orders over $500,000 |
| Pricing | 2269.404 | Unit price book line items, or work item list plus proposed coefficients |
| Procurement | 2269.405 | Competitive sealed proposals; may weigh experience, past performance, personnel, methodology |
| Award | 2269.406 | One or more contractors per solicitation |
| Other users | 2269.407 | Only if solicitation and contract allow it, or by interlocal agreement |
| Design professionals | 2269.408 | Architect or engineer prepares documents when licensed services are needed |
| Term | 2269.409 | Up to 2 years, plus up to 3 annual renewals |
| Orders | 2269.410 | Signed by both sides; lump sum or unit price |
| Bonds | 2269.411 | If required by law, based on each order's amount |
Source: Texas Government Code, Chapter 2269, Subchapter I, sections 2269.401 to 2269.411, and section 2269.002 for which entities the chapter covers. Laws change, so confirm against the current text before you act on it.