# Port Houston Construction: Procurement Methods, Bonds and Security URL: https://mycontractorsinsurancequote.com/projects/airport-and-port-construction/port-houston Updated: 2026-10-29 · Reviewed by the Principal, Gleason Insurance Brokers, LLC Publisher: My Contractors Insurance Quote, a website of Gleason Insurance Brokers, LLC Port Houston's procurement manual, dated October 29, 2024, says the Port Commission must decide which construction method gives best value before advertising, under Texas Water Code Section 60.459, and that several methods, including design-build and construction manager at risk, had not yet been approved or used. When design-build is used, the manual requires payment and performance bonds equal to the project budget if there is no guaranteed maximum price, delivered by the 10th day after execution. Insurance limits for construction contracts are set in each solicitation; the Port's published $1 million minimums apply to permit and license holders, not contractors. ## Key Decision Points - The Port of Houston Authority, governed by the Port Commission, follows Texas Water Code Chapter 60 for construction contracting. - The Commission picks the delivery method by best value before advertising, under Water Code Section 60.459. - As of the October 2024 manual, job order, CM at risk, CM agent and design-build had not been approved or used. - Design-build bonds exclude the design-only portion and equal the project budget when there is no guaranteed maximum price. - The Port's published $1 million insurance minimums are written for permit and license applicants, not construction contractors. - Terminal work inside maritime secure areas typically needs TWIC or an escort, depending on the facility. ## The Port Authority and the Statute Behind Its Contracts Port Houston is the Port of Houston Authority, governed by the Port Commission. Its procurement manual states that construction contracting follows Chapter 60 of the Texas Water Code, not the City of Houston's construction documents or the rules a Texas city uses. That matters for a contractor that knows City or TxDOT work: the forms, the award criteria and the approval steps come from the Port's own manual and solicitation. Award criteria follow Water Code Section 60.458, so the manual and the solicitation together explain how a bid or proposal will be scored. The Port reported in September 2024 that it had received a Texas Comptroller Transparency Star for contracts and procurement, and its manual and Commission materials are worth reading before a first pursuit. For how Port Houston compares with West Coast ports and Texas airports, see [airport and port construction requirements](https://mycontractorsinsurancequote.com/projects/airport-and-port-construction). ## How the Port Commission Picks a Delivery Method Section 11.1 of the October 2024 manual says that, in line with Water Code Section 60.459, the Port Commission must determine before advertising which construction method provides best value. A contractor reading a Port Houston solicitation is therefore reading the result of a decision the Commission has already made, not a default bid process. The manual is unusually direct about what it has not done. It says the Port Authority had not received Port Commission approval for, and had not used, several procurement mechanisms, including job order contracting, construction manager at risk, construction manager agent and design-build. It notes that competitive sealed bidding is used for repairs tied to damage claims. Firms that build their pursuit strategy around CM at risk or job order contracts at other owners should check the current solicitation calendar rather than assume those methods are in use here, because the Commission can approve new methods after the manual's date. The method drives the insurance and bond answer. A hard-bid repair contract, a design-build contract and a future CM at risk contract each place different risks on the contractor, from design liability to the size of the bond, so the delivery method stated in the solicitation is the first thing to confirm. Program design for contractors who bid public owners is covered in [insurance and bonds for public works contractors](https://mycontractorsinsurancequote.com/who-we-serve/general-contractors/public-works-contractors). ### Illustrative scenario: A Marine Contractor Weighs a Design-Build Wharf Package Galveston Bay Marine Constructors, a pile-driving and dock contractor, is teaming with an engineer on a Port Houston wharf rehabilitation advertised as design-build. Because the contract has no guaranteed maximum price, the bonds would equal the full project budget of $38 million, so the firm's surety asks for the budget, the design split and current work in progress before committing, and the team arranges a joint venture bond in advance to meet the 10-day delivery window. The firm's broker compares its workers' compensation and maritime employers liability forms with the solicitation's insurance exhibit, and the crew lead checks which work areas need TWIC or escorts. These details are hypothetical, and a real program depends on Port Houston, the surety and carriers and the firm's own risk. ## Design-Build Bonds Sized to the Project Budget Section 11.2.3.6 of the manual sets the bond rule for design-build. Payment and performance bonds are required, but not for the design-only portion of the work. If the contract has no guaranteed maximum price, the penal sum of each bond must equal the project budget, and the bonds must be delivered by the 10th day after the contract is executed. That sizing rule can be demanding. A bond equal to a full project budget, rather than to a negotiated construction price, can consume more bonding capacity than the contractor's share of the work suggests, and a 10-day delivery window leaves little room to arrange co-surety or a joint venture bond after award. A surety typically wants to see the budget, the design responsibility split and the team's work in progress early in the pursuit. For other delivery methods, the solicitation states the bond requirement, and we did not find a published bid bond percentage. Payment and performance bond rules for Texas public owners are explained in [Texas public works bond requirements](https://mycontractorsinsurancequote.com/construction-surety-bonds/public-works-bond-requirements/texas). ## Insurance: What the Published Minimums Do and Do Not Cover The insurance document Port Houston posts, Minimum Insurance Requirements revised February 2026, is written for permit and license applicants on channel infrastructure real property, not for construction contracts. It asks for Texas statutory workers' compensation with $1 million employer's liability, $1 million general liability including contractual, products-completed operations and personal injury, and $1 million auto on owned, hired and non-owned vehicles, with a waiver of subrogation in favor of the Port Authority, additional insured status on general liability, auto and umbrella, primary wording, 30 days' notice and carriers authorized in Texas. Those figures show how the Port writes insurance terms, but they are not a contractor's requirement. Construction limits, any builder's risk or pollution line and any owner-controlled program are set in each solicitation; we found no published wrap-up program for Port Houston construction. Dredging, wharf and channel work can carry very different limits from a landside paving or building contract, so read the insurance exhibit before pricing. Pollution exposure on dredging, fill and waterfront work is explained in [contractors pollution liability](https://mycontractorsinsurancequote.com/contractors-pollution-liability-insurance). ## Waterside Work, Maritime Coverage and TWIC The Port Houston documents we read do not list USL&H, Jones Act or maritime employers liability requirements for contractors. That does not settle the question. The federal Longshore and Harbor Workers' Compensation Act can apply to work over or next to navigable water depending on the facts, and vessel crews raise separate questions, so a contractor planning dock, wharf or channel work should confirm what the solicitation asks for and have its broker compare its workers' compensation and liability forms against the scope. Security is a separate gate. The Transportation Security Administration says the Transportation Worker Identification Credential is required by the Maritime Transportation Security Act for workers who need access to secure areas of maritime facilities and vessels; the new-applicant fee is $127 and the credential is valid for five years. The Port's bid documents we read did not state a TWIC rule for contractors, so terminal work inside secure areas typically needs TWIC or an escort, depending on the facility and the solicitation. ## Project 11 and the Ship Channel Work The largest program on the waterway is Project 11, the Houston Ship Channel expansion. Port Houston reported in September 2024 that five of the 14 planned Project 11 contracts, split between Port Houston and the U.S. Army Corps of Engineers, had been completed as of September 24, 2024. Contracts held by the Corps are procured by the Corps, while Port Houston contracts follow the Port's own manual, so a contractor needs to know which owner holds the contract it is pursuing. Channel widening and deepening typically involve dredging, placement and environmental controls, which bring marine equipment, pollution and maritime employee questions together. Check the solicitation's owner, delivery method and insurance exhibit before treating any Project 11 package as a Port Houston contract. For the wider Houston market, including county and developer rules, see [Houston construction and development requirements](https://mycontractorsinsurancequote.com/texas/metros/houston). ## Before You Ask for a Quote ### What to Gather - The solicitation's delivery method, insurance exhibit and bond forms - The Port's procurement manual dated October 29, 2024 - Project budget and any guaranteed maximum price for design-build work - Workers' compensation, maritime employers liability and general liability forms - Surety work in progress and joint venture indemnity terms - A list of crew members who will need TWIC or escorts ### What to Ask the Insurer or Surety - Which delivery method did the Port Commission select for this contract? - Does a design-build bond here equal the full project budget, and can it be delivered within 10 days? - What construction insurance limits does the solicitation set beyond the permit minimums? - Does the scope involve work over or next to navigable water that raises Longshore Act questions? - Is this Project 11 contract held by Port Houston or the Corps of Engineers? - Which work areas fall inside maritime secure areas that need TWIC? ## Broker Notes **Quick Answer:** Port Houston follows Texas Water Code Chapter 60: the Port Commission picks a best-value method before advertising, and design-build bonds equal the project budget when there is no guaranteed maximum price, due within 10 days of execution. **Common Mistake:** Using the Port's published $1 million insurance minimums as contract limits. That document is written for permit and license applicants, and construction limits come from each solicitation. **Broker Perspective:** A design-build bond sized to the whole project budget can use far more surety capacity than the construction share suggests, so the surety conversation typically starts at the teaming stage. **Coverage Impact:** Waterside scopes can raise federal Longshore Act and maritime employee questions that a standard state workers' compensation policy may not address, depending on the facts and the solicitation. ## Questions Buyers Ask ### Which law governs Port Houston construction contracting? The Port's procurement manual says construction contracting follows Texas Water Code Chapter 60, with method selection under Section 60.459 and award criteria under Section 60.458. ### Does Port Houston use design-build or CM at risk? The October 2024 manual says the Port had not received Commission approval for, or used, job order, CM at risk, CM agent or design-build. The Commission can approve methods later, so check the solicitation. ### How large are Port Houston design-build bonds? Under the manual, payment and performance bonds exclude the design-only portion and equal the project budget when there is no guaranteed maximum price. They are due by the 10th day after execution. ### What insurance limits does Port Houston require of contractors? The solicitation sets them. The Port's posted $1 million workers' compensation, general liability and auto minimums are written for permit and license applicants, not construction contracts. ### Do Port Houston contractor crews need TWIC? TSA says TWIC is required for workers who need access to secure areas of maritime facilities. The bid documents we read did not state a contractor rule, so confirm with the solicitation and facility. ## Official Sources 1. [Procurement Manual (October 29, 2024)](https://porthouston.com/wp-content/uploads/2024/10/Procurement-Manual-10-29-24.pdf), Port of Houston Authority. Water Code Chapter 60 basis; best-value method choice under 60.459 and award under 60.458 (11.1.1-11.1.2); methods not yet approved or used and damage-claim repairs (11.1, 11.2.1); design-build bonds (11.2.3.6) Verified 2026-10-26. 2. [Minimum Insurance Requirements (Rev. 02/2026)](https://porthouston.com/wp-content/uploads/2026/05/17_Minimum_Insurance_Requirements.pdf), Port Houston. Permit and license applicant minimums: workers' compensation and $1 million employer's liability, general liability and auto; waiver, additional insured, primary, notice and Texas-authorized carriers Verified 2026-10-26. 3. [September 2024 Port Commission meeting press release](https://porthouston.com/wp-content/uploads/2024/09/Sept-2024-Port-Houston-Commission-Meeting-Press-Release-Project-11-Progresses-on-Key-Milestones.pdf), Port Houston. Five of 14 Project 11 contracts complete as of September 24, 2024; split with USACE; Comptroller Transparency Star for contracts and procurement Verified 2026-10-26. 4. [Texas Water Code Chapter 60, Subchapter O, Purchase Contracts](https://tcss.legis.texas.gov/resources/WA/htm/WA.60.htm), Texas Legislature. Location of Sections 60.458 and 60.459, the award and method-selection sections the Port's manual cites Verified 2026-10-26. 5. [Transportation Worker Identification Credential (TWIC)](https://www.tsa.gov/for-industry/twic), Transportation Security Administration. TWIC required under MTSA for workers who need access to secure areas of maritime facilities and vessels; $127 fee; five-year validity Verified 2026-10-26. ## Related Decisions - [airport and port construction requirements](https://mycontractorsinsurancequote.com/projects/airport-and-port-construction) - [Houston Airport System contractor requirements](https://mycontractorsinsurancequote.com/projects/airport-and-port-construction/houston-airport-system) - [performance bonds](https://mycontractorsinsurancequote.com/construction-surety-bonds/performance-bonds) - [Texas civil and infrastructure contractor insurance](https://mycontractorsinsurancequote.com/texas/audiences/civil-infrastructure-contractors) - [City of Houston construction contract requirements](https://mycontractorsinsurancequote.com/construction-surety-bonds/public-agency-contractor-requirements/city-of-houston) --- Start a quote request: https://mycontractorsinsurancequote.com/get-a-quote · Call 844-978-7283 Contract and insurance reviews are a courtesy service that may be available at times, depending on our workload and on the size, timing and complexity of the project. A review is not guaranteed and is limited to insurance considerations. It is not legal advice and is not a substitute for advice from your own legal counsel, which you may need before signing a contract or obtaining coverage. Insurance and surety services are provided through Gleason Insurance Brokers, LLC. Site information is educational and does not constitute legal advice, a binder, an offer of coverage, a guarantee of eligibility or confirmation of policy terms. Insurance conditions are governed by actual issued policies; surety rights and obligations are governed by bond and indemnity documents.