The bill, H.B. No. 3573, introduces new provisions regarding contracting by governmental entities in Texas, specifically prohibiting discrimination based on race, color, ethnicity, sex, gender identity, or sexual orientation in the awarding of contracts. This is established through the addition of Section 2252.911 to the Government Code, which explicitly states that governmental entities cannot provide preferential treatment to bidders based on these characteristics.

Additionally, the bill repeals Chapter 2161 of the Government Code, which pertains to the state's historically underutilized business program. However, it clarifies that any fund transfers directed by the Legislative Budget Board prior to the bill's effective date will still be governed by the previous law. The changes will only apply to contracts entered into after the bill's effective date of September 1, 2025, ensuring that existing contracts remain under the law that was in effect at the time they were signed.

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