(a) The Mentor-Protégé Program is a program administered by the comptroller in accordance with Government Code, §2161.065, and implemented by state agencies. The purpose of the Mentor-Protégé Program is to foster long-term relationships between experienced contractors and HUBs and to increase the ability of HUBs to obtain and perform contracts and subcontracts for state agency business. Each state agency with a biennial appropriation that exceeds $10 million shall implement the Mentor-Protégé Program.
(b) Each state agency that implements the Mentor-Protégé program shall consider:
  (1) the needs of protégé businesses requesting to be mentored;
  (2) the availability of mentors who possess unique skills, talents, and experience related to the mission of the state agency's program; and
  (3) the state agency's staff and other resources.
(c) Agencies may elect to implement the Mentor-Protégé Program individually or in cooperation with other agencies, public entities, or private organizations. Agencies are encouraged to implement a Mentor-Protégé Program to address the needs of protégé businesses in the following areas:
  (1) construction;
  (2) commodities; and
  (3) services.
(d) State agencies may consider, but are not limited to, the following factors in developing their Mentor-Protégé Program:
  (1) internal procedures, including an application process, regarding the Mentor-Protégé Program which identifies the eligibility criteria and the selection criteria for mentors and potential HUB protégé businesses;
  (2) recruitment of contractor mentors and protégés;
  (3) documentation of the roles and expectations of the state agency, the mentor and the protégé;
  (4) monitoring progress of mentor-protégé relationships;
  (5) key agency resources including senior managers and procurement personnel to assist with the implementation of the program;
  (6) partnerships with local governmental and nonprofit entities;
  (7) the appropriate length of time for mentor-protégé relationships to continue (generally limited to four years);
  (8) guidance related to the Mentor-Protégé Program in the Disparity Study; and
  (9) assessment of the effectiveness of their Mentor-Protégé Program by conducting periodic surveys and interviews of mentors and protégés.
(e) A state agency's Mentor-Protégé Program implementation must include mentor eligibility and selection criteria. In determining the eligibility and selection of a mentor, state agencies shall require each mentor to be registered on the Centralized Master Bidders List (CMBL); and may additionally consider the following criteria:
  (1) whether the mentor has extensive work experience and can provide developmental guidance in areas that meet the needs of the protégé, including but not limited to, business, financial, and personnel management; technical matters such as production, inventory control and quality assurance; marketing; insurance; equipment and facilities; and other related resources;
  (2) whether the mentor is in "good standing" with the State of Texas and is not in violation of any state statutes, rules or governing policies;
  (3) whether the mentor has mentoring experience;
  (4) the number of protégés that a mentor can appropriately assist;
  (5) whether the mentor has a successful past work history with the state agency;
  (6) the amount of time a HUB has participated as a mentor in the program, or in other agencies' programs; and
  (7) whether and to what extent the mentor and protégé businesses share management, board members, partners, current or former employees, or other resources that might indicate that they are related or affiliated businesses.
(f) A state agency's Mentor-Protégé Program implementation must include protégé eligibility and selection criteria. In determining the eligibility and selection of HUB protégés, state agencies may use the following criteria:
  (1) whether the protégé is eligible and willing to become certified as a HUB;
  (2) whether the protégé's business has been operational for at least one year;
  (3) whether the protégé is willing to participate with a mentor and will identify the type of guidance that is needed for its development;
  (4) whether the protégé is in "good standing" with the State of Texas and is not in violation of any state statutes, rules, or governing policies;
  (5) whether the protégé is involved in a mentoring relationship with another contractor;
  (6) the amount of time a HUB has participated as a protégé in the program, or in other agencies' programs; and
  (7) whether and to what extent the mentor and protégé businesses share management, board members, partners, employees, or other resources that might indicate that they are related or affiliated businesses.
(g) The mentor and the protégé should agree on the nature of their involvement under the state agency's Mentor-Protégé Program. The state agency will monitor the progress of the relationship. The mentor and protégé relationship should be reduced to writing and may include, but is not limited to, the following:
  (1) identification of the developmental areas in which the protégé needs guidance;
  (2) the time period which the developmental guidance will be provided by the mentor;
  (3) points of contact that will oversee the agreement of the mentor and protégé;
  (4) procedure for a mentor to notify the protégé in advance if it intends to withdraw from the program or terminate the mentor-protégé relationship;
  (5) procedure for a protégé to notify the mentor in advance if it intends to terminate the mentor-protégé relationship; and
  (6) a mutually agreed upon timeline to report the progress of the mentor-protégé relationship to the state agency.
(h) The protégé must maintain its HUB certification status for the duration of the agreement.
(i) Each state agency must notify its mentors and protégés that participation is voluntary. The notice must include written documentation that participation in the state agency's Mentor-Protégé Program implementation is neither a guarantee of a contract opportunity nor a promise of business; but the program's intent is to foster positive long-term business relationships.
(j) State agencies may demonstrate their good faith under this section by submitting a supplemental letter with documentation to the comptroller with their HUB report or legislative appropriations request identifying the progress and testimonials of mentors and protégés that participate in the state agency's program.
(k) Each state agency that implements the Mentor-Protégé Program must report that information to the comptroller upon completion of a signed agreement by both parties. Information regarding the Mentor-Protégé Agreement shall be reported in a form prescribed by the comptroller within 21 calendar days after the agreement has been signed. The comptroller will register that agreement on the approved list of mentors and protégés. Approved Mentor-Protégé Agreements are valid for all state agencies in determining good faith effort for the particular area of subcontracting to be performed by the protégé as identified in the HUB subcontracting plan.
(l) The comptroller shall retain and make available to state agencies all registered Mentor-Protégé Agreements. The sponsoring state agency shall monitor and report the termination of an existing Mentor-Protégé Agreement that has been registered with the comptroller within 21 calendar days.

Source Note: The provisions of this §20.298 adopted to be effective January 24, 2017, 42 TexReg 235; amended to be effective August 9, 2023, 48 TexReg 4268