TEXAS PUBLIC FINANCE AUTHORITY REQUEST FOR PROPOSALS FOR FINANCIAL ADVISOR. RFP ISSUE DATE: October 24, 2003 Proposals Due: 1:00 PM, November 17, 2003

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1 TEXAS PUBLIC FINANCE AUTHORITY REQUEST FOR PROPOSALS FOR FINANCIAL ADVISOR RFP ISSUE DATE: October 24, 2003 Proposals Due: 1:00 PM, November 17, 2003 PURPOSE The Texas Public Finance Authority (the "Authority") seeks proposals in response to this Request for Proposal ("RFP") from firms with the qualifications and experience required to provide financial advisory services to the Authority. This RFP is issued for the purpose of selecting financial advisory services to the Authority during the remainder of the biennium, beginning on or about December 16, 2003, and ending August 31, 2005, as described herein. Based on consideration of the responses to this RFP, the Authority s Board of Directors may either: (1) select one or more firms with which to contract for all bond matters; or (2) pre-qualify firms eligible to be selected for a contract for specific bond issues, on a transaction by transaction basis. Please indicate in part 1 of your response whether your firm would like to serve as only a financial advisor, only a co-financial advisor, or either. HISTORY OF THE AUTHORITY S FINANCING PROGRAMS The Authority (formerly the Texas Public Building Authority) was created in 1983 by the 68th Texas Legislature. The Authority is authorized to issue revenue bonds and general obligation bonds for the State of Texas to provide funding for the purposes as specifically authorized by the Legislature. The Authority has served as the issuer for the following state agencies: the Texas Building and Procurement Commission, the Texas Department of Criminal Justice, the Texas Department of Mental Health and Mental Retardation, the Texas Youth Commission, the Texas Juvenile Probation Commission, the Department of Public Safety, the Texas National Research Laboratory Commission (the agency responsible for the State s share of the construction of the Superconducting Supercollider), the Texas Parks and Wildlife Department, the State Preservation Board, the Texas Department of Health, the Texas Military Facilities Commission, the Texas Workers Compensation Insurance Fund, the Texas State Technical College System, Midwestern State University, Stephen F. Austin University, Texas Southern University and the Texas Workforce Commission. The Authority currently administers three commercial paper programs: the Master Lease Purchase Program, which is primarily for financing equipment acquisitions through a revenue commercial paper program; a General Obligation commercial paper program, (Series 2002A) for certain general state government construction projects; and the General Obligation Commercial Paper program (Series 2002B) for the Colonia Roadway program. DIRECTION AND MANAGEMENT OF THE AUTHORITY The Authority is governed by a seven-member Board of Directors (the "Board"), appointed by the Governor with the advice and consent of the Senate for six-year, staggered terms. The current members of the Board are: Mr. R. David Kelly, Chairman, H.L. Bert Mijares, Jr., Vice Chairman, Vaughn Brock, Secretary, Helen Huey, Dan Serna and Barry Smitherman, Members. An appointment to fill the seventh position on the Board is pending the Governor s action. The Executive Director is Kimberly K. Edwards. S:\RFP's\Financial Advisor\ \FA RFP wpd 1

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8 EXHIBIT A The Texas Public Finance Authority will not participate in any programs, nor will it conduct business, with any entity that is found to knowingly discriminate against persons on the basis of race, color, gender, age, national origin, religion, physical or mental disability. Please use this form to provide us with a breakdown of your company s workforce. Total number of employees: Executives 2002 Males Year White Black Hispanic Oriental Disabled Other 2003 Professionals Subtotal Exs. + Professionals % of Exs + Professionals to total EES Clerical/ 2002 Technical 2003 Totals Percentage Total number of male employees: Percentage of total workforce:

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10 EXHIBIT B Contracts Terms and Conditions Mandated by Texas Statutes 1. Texas Family Code, Chapter 231, relating to Child Support. Explanation: Chapter 231 prohibits bids, grants, loans, and contracts with any business entity in which a person who has at least a 25% ownership interest is 30 days or more delinquent in paying child support. Contract provision : Under Texas Family Code, Section (relating to child support), Financial Advisor certifies that it is not ineligible to receive the specified payment and acknowledges that the contract may be terminated and payment withheld if this certification is incorrect. 2 Texas Government Code, Section , relating to prohibition on payments to debtors and delinquent tax payers. Explanation: Payments to persons who owe a debt to the state or are delinquent in paying state taxes are prohibited. Contracts with such persons are also prohibited unless the person agrees to a contract clause that permits offsetting the debt or delinquent tax by the payments due under the contract. Contract provision: Payments due the Financial Advisor under this contract shall be applied to any debt or delinquent tax the Financial Advisor owes to the state until such debt or delinquent tax is paid in full. 3. Texas Government Code, Section , relating to Alternative Dispute Resolution Explanation: Contracts of any state agency must include a provision that the dispute resolution process used by the agency in accordance with Chapter 2260 must be used to resolve any disputed arising under the contract. Contract provision: The parties agree that any dispute arising under the contract shall be resolved in accordance with an alternative dispute resolution that complies with Chapter 2260, Texas Government Code. 1

11 4. Texas Government Code, Section , relating to prohibited contracts Explanation: A state agency may not contract with a firm: (a) that includes financial participation by a person who received compensation from the agency for preparing specifications or a request for proposal; or (b) that is incorporated or domiciled out of the state unless the firm holds a permit from the comptroller to collect and remit all taxes due, or certifies that it does not sell products or services subject to sales or use tax. Contract provision: Under Section , the Texas Government Code, the Financial Advisor certifies that it is not ineligible to receive the contract and acknowledges that the contract may be terminated and payments withheld if this certification is inaccurate. 5. Texas Government Code, Section , relating to contract audits by the State Auditor s Office Explanation: Section was added to the Texas Government Code by SB 19, Acts, 78 th Legislature, R.S. (2003). It requires all contracts of state agencies to contain a provision that the contractor and any subcontractor, by accepting funds under the contract or subcontract, understand and agree that the State Auditor s Office may audit or investigate such funds. Contract provision: Financial Advisor understands and agrees that by accepting funds under a contract with the Authority it is accepting the authority of the State Auditor s Office to conduct an audit or investigation with respect to such funds. Financial Advisor further agrees to cooperate fully with the State Auditor s Office or its successor in agency the conduct of the audit or investigation, including providing all records requested. may 2