The bill, H.B. No. 251, introduces new provisions regarding contracting by governmental entities in Texas, specifically prohibiting the consideration of certain factors when awarding contracts. It adds Section 2252.911 to the Government Code, which stipulates that governmental entities may only consider merit-based criteria, as outlined in Section 2155.074, and cannot award contracts based on race, color, ethnicity, sex, gender identity, sexual orientation, or any criteria associated with diversity, equity, and inclusion practices. This aims to ensure that contracting decisions are made solely on the basis of qualifications and performance rather than demographic factors.

Additionally, the bill repeals Chapter 2161 of the Government Code, which previously governed the state's historically underutilized business program. The repeal does not affect any fund transfers directed by the Legislative Budget Board prior to the bill's effective date, ensuring that those transactions remain governed by the former law. The changes will apply only to contracts entered into after the bill's effective date, which is set for 91 days following the end of the legislative session.

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