Are auctioneer services 'professional services' that a Texas city can exempt from competitive bidding?

Plain-English summary

Texas cities of a certain size have to competitively bid most of their bigger contracts. At the time of this opinion, a municipality of 50,000 or more had to use competitive sealed bidding or sealed proposals before entering a contract requiring an expenditure of more than $10,000. But the bidding chapter carves out "personal or professional services." The City of Fort Worth was getting auctioneering services and asked, in effect, whether it had to bid that contract or whether auctioneers count as exempt "professional services." A state senator brought the question to the Attorney General.

The opinion's answer had two parts. First, deciding whether a given service is a "professional service" (other than the handful spelled out in a separate statute) is largely a fact question, and a city gets to make that call in the first instance. Fort Worth had decided auctioneering was not a professional service and had to be bid, and the opinion found nothing in the law that barred that decision. Second, and more practically, it did not matter much which way the city came out, because the professional-services exemption is permissive, not mandatory. A city is free to competitively bid a contract even when the service could qualify for the exemption. The only services a city may never put out for competitive bid are those covered by the Professional Services Procurement Act, V.T.C.S. article 664-4, which lists architects, optometrists, certified public accountants, physicians, surgeons, and registered engineers, and which says nothing about auctioneers.

So Fort Worth could competitively bid the auctioneering contract, and its determination that auctioneering is not a professional service was not contrary to law.

Currency note

This opinion was issued in 1992. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. The competitive-bidding thresholds in Local Government Code chapter 252 have been amended since 1992, and the Professional Services Procurement Act formerly at V.T.C.S. article 664-4 was recodified into chapter 2254 of the Government Code, so confirm the current statutes (including the current dollar threshold and list of covered professions) before relying on this opinion.

Background and statutory framework

The question came from the City of Fort Worth's procurement of auctioneering services. Local Government Code section 252.021 required a municipality of 50,000 or more inhabitants to use competitive sealed bidding or competitive sealed proposals before entering a contract requiring an expenditure of more than $10,000 from municipal funds. Section 252.022(a)(4) provided that chapter 252 does not apply to "a procurement for personal or professional services." The city's legal department took the position that the auctioneering contract had to be competitively bid; the request asked whether auctioneering was instead an exempt professional service.

The opinion recognized, as earlier opinions had, that "professional services" can reach beyond physicians, attorneys, and others traditionally regarded as professionals. Attorney General Opinions JM-940 (1988) (citing Maryland Casualty Co. v. Crazy Water Co., 160 S.W.2d 102 (Tex. Civ. App.-Eastland 1942, no writ)) and MW-344 (1981). The cited opinions described professionals as members of disciplines requiring special knowledge or attainment and a high order of learning, skill, and intelligence, and noted that several cases suggest the term comprehends labor and skill that is predominantly mental or intellectual rather than physical or manual. At the same time, whether particular services (other than those covered by the Professional Services Procurement Act) are professional services for bidding purposes frequently involves fact questions the opinion process cannot resolve. Attorney General Opinions JM-1136 (1990), JM-1038 (1989); Letter Opinion No. 90-67 (1990).

Applying that, the opinion concluded that Fort Worth, based on its understanding of the law and facts, had determined auctioneering services were not professional services and had to be procured by competitive bidding, and nothing in the law precluded that decision. The opinion added that the result did not really turn on the classification, because section 252.022 allows but does not require a municipality to exempt professional services from bidding. Patten v. Concho County, 196 S.W.2d 833 (Tex. Civ. App.-Austin 1946, no writ) (where competitive-bidding laws do not apply to a county expenditure, the commissioners court has discretion whether good management calls for a bidding process). The only professional services that may not be competitively bid are those covered by the Professional Services Procurement Act, V.T.C.S. article 664-4, which does not reach auctioneering.

Common questions

Did Fort Worth have to competitively bid its auctioneering contract?
The opinion concluded the city's decision to treat auctioneering as a non-professional service requiring competitive bidding was not contrary to law. Either way, the city was free to bid the contract.

Who decides whether a service is a 'professional service' under chapter 252?
The municipality, in the first instance. For services other than those listed in the Professional Services Procurement Act, the opinion said the determination often turns on facts and is for the city to make.

Can a city competitively bid a service that qualifies as professional?
Yes. The opinion stressed that the section 252.022 exemption is permissive. A city may competitively bid even a service that could be exempt; chapter 252 sets a floor of contracts that must be bid, not a ceiling.

Are any services off-limits for competitive bidding?
Yes. The services covered by the Professional Services Procurement Act (then V.T.C.S. article 664-4), such as architects, optometrists, certified public accountants, physicians, surgeons, and registered engineers, may not be procured on the basis of competitive bids. Auctioneering was not on that list.

Citations

• Local Government Code §§ 252.021, 252.022, 252.022(a)(4); chapter 252
• V.T.C.S. article 664-4 (Professional Services Procurement Act)
• Maryland Casualty Co. v. Crazy Water Co., 160 S.W.2d 102 (Tex. Civ. App.-Eastland 1942, no writ)
• Patten v. Concho County, 196 S.W.2d 833 (Tex. Civ. App.-Austin 1946, no writ)
• Tex. Att'y Gen. Ops. JM-940 (1988), MW-344 (1981), JM-1136 (1990), JM-1038 (1989); Letter Opinion No. 90-67 (1990)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0106
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1992/dm0106.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
ATTORNEY GENERAL

April 20, 1992

Honorable Mike Moncrief
Chairman
General Issues Subcommittee
Texas State Senate
P. O. Box 12068, Capitol Station
Austin, Texas 78711-2068

Opinion No. DM-106

Re: Whether services of auctioneers are "professional services" for purposes of laws governing the awarding of contracts by cities and counties, and related questions (RQ-152)

Dear Senator Moncrief:

You have requested an opinion from this office regarding competitive bidding requirements affecting municipalities, as codified in Local Government Code section 252.021. That section provides in pertinent part the following:

(a) Before a municipality with 50,000 or more inhabitants may enter into a contract that requires an expenditure of more than $10,000 from one or more municipal funds, the municipality must comply with the procedure prescribed by this chapter for competitive sealed bidding or competitive sealed proposals.

The legal department of the City of Fort Worth maintains that a contract between the city and an auctioneering company for services rendered within the statutory amount must be awarded in accordance with this statute. You have requested our opinion as to whether such services would instead be exempt from the competitive bidding requirements as professional services under Local Government Code section 252.022(a)(4), providing that chapter 252 does not apply to certain expenditures, including "a procurement for personal or professional services."

This office has recognized in previous opinions that "professional services" may encompass more than the services of physicians, attorneys, or others traditionally regarded as "professionals."[1] See Attorney General Opinions JM-940 (1988) at 3 (citing Maryland Casualty Co. v. Crazy Water Co., 160 S.W.2d 102 (Tex. Civ. App.-Eastland 1942, no writ)); MW-344 (1981). Furthermore, opinions such as Attorney General Opinion JM-1136 (1990) have demonstrated that determinations as to whether particular services, other than those covered by the Professional Services Procurement Act, V.T.C.S. art. 664-4, are professional services for competitive bidding purposes, frequently involve fact questions that the opinion process cannot address. See also Attorney General Opinion JM-1038 (1989); Letter Opinion No. 90-67 (1990).[2]

In your case, the city of Fort Worth has made a determination, based upon its understanding of the law and facts, that the auctioneering services at issue are not professional services and must therefore be procured through competitive bidding. We find nothing in the law that would preclude such a decision. More importantly, the city could have decided to competitively bid the contract for auctioneering services even if it had come to the opposite conclusion regarding the nature of the services. Section 252.022 of the Local Government Code allows municipalities to exempt professional services from competitive bidding requirements; it does not, however, mandate that they do so. See Patten v. Concho County, 196 S.W.2d 833 (Tex. Civ. App.-Austin 1946, no writ) (if competitive bidding laws do not apply to a particular county expenditure, commissioners court has discretion to determine whether or not good management requires use of a competitive bidding process). The only professional services that may not be competitively bid are those covered by the Professional Services Procurement Act. That act does not refer to auctioneering services.

In conclusion, we believe that a municipality has discretion in the first instance to determine whether particular services, other than those covered by article 664-4, V.T.C.S., are professional services for purposes of exemption from competitive bidding requirements under Local Government Code section 252.022. Moreover, we emphasize that Local Government Code chapter 252 serves to require municipalities to competitively bid most procurement contracts; it does not bar municipalities from competitively bidding even those projects that might conceivably be exempt from chapter 252.

SUMMARY

The determination of the city of Fort Worth that auctioneering services are not "professional services" for purposes of exemption from the competitive bidding requirements imposed by Local Government Code chapter 252 is not contrary to law. Moreover, municipalities may procure services through a competitive bidding process even if such services qualify for an exemption under Local Government Code section 252.022, other than those services covered by article 664-4, V.T.C.S.

DAN MORALES
Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Faith S. Steinberg
Assistant Attorney General

[1] Cf. V.T.C.S. art. 664-4 (Professional Services Procurement Act, prohibiting governmental entities from procuring the services of architects, optometrists, certified public accountants, physicians, surgeons, and registered engineers on the basis of competitive bids).

[2] The cited opinions provide some guidance for determining whether particular services are "professional": included as purveyors of "professional services" are "members of disciplines requiring special knowledge or attainment and a high order of learning, skill, and intelligence." Attorney General Opinion JM-940 at 3. Furthermore, "several cases suggest that it comprehends labor and skill that is 'predominantly mental or intellectual, rather than physical or manual.'" Id. (citing Maryland Casualty Co.).