PA 07-1, September 2007 Special Session—SB 1600

Emergency Certification

AN ACT CONCERNING CLEAN CONTRACTING STANDARDS

SUMMARY: This act establishes a State Contracting Standards Board (SCSB) as an independent Executive Branch agency. It gives the new board various responsibilities associated with state contracting processes, including adopting procurement regulations and reviewing, monitoring, and auditing state contracting agencies' procurement processes. “State contracting agencies” are state Executive Branch agencies, boards, commissions, departments, offices, institutions, or councils. They do not include the Judicial Branch; the Legislative Branch; the offices of the Secretary of the State, the State Treasurer, the State Comptroller, or the Attorney General with respect to their constitutional functions; or any state agency with respect to contracts specific to the responsibilities of the Office of the State Treasurer.

The act provides for disqualifying and suspending contractors, bidders, or proposers who fail to follow state procurement policies.

The act requires the Judicial and Legislative branches to each prepare a procurement code by February 1, 2011 and statewide officers to each adopt one by June 1, 2011.

It requires all state contracts that take effect on or after the act's passage to contain provisions to ensure accountability, transparency, and results-based outcomes. “Contract” or “state contract” means an agreement or a combination or series of agreements between a state contracting agency or quasi-public agency and a business for:

1. a project for the construction, reconstruction, alteration, remodeling, repair or demolition of any public building, public work, mass transit, rail station, parking garage, rail track, or airport;

2. services, including consultant and professional services;

3. the acquisition or disposition of personal property;

4. the provision of goods and services, including the use of purchase of services contracts and personal service agreements;

5. the provision of information technology, state agency information system or telecommunication system facilities, equipment, or services; or

6. a lease or a licensing agreement.

“Contract” or “state contract” does not include a contract between a state agency or a quasi-public agency and a political subdivision of the state.

The act requires the DAS to maintain a single electronic portal for posting most contracting opportunities in the state.

The act establishes a procedure for privatizing state contracts, including a requirement for cost-benefit analyses and business cases. It specifies that the SCSB's establishment and general duties and its privatization provisions do not affect the requirements in PA 06-129. That act requires the Department of Administrative Services (DAS) commissioner to establish a four-year pilot program to create and expand janitorial jobs for people with disabilities (except blindness) or a disadvantage who meet specific criteria.

The act appropriates $700,000 to the SCSB from the General Fund for FY 08-09 to carry out the board's duties.

Lastly, the act makes conforming changes.

EFFECTIVE DATE: Various, see below.

§§ 2-5 — SCSB

The act establishes the 14-member SCSB as a separate, independent, Executive Branch agency. The governor appoints eight board members, the Senate president pro tempore and House speaker each appoint two, and the Senate and House majority leaders each appoint one. If the governor is of the same political party as the majority in both chambers of the General Assembly, the top six legislative leaders each appoint one member.

Each member serves at the pleasure of the appointing authority up to a maximum term coterminous with that of the appointing authority. Each appointing authority fills any vacancy in his or her appointment. Eight members of the board, including at least one member appointed by a legislative leader, constitute a quorum, which is required to transact business. The governor appoints the board's chairperson.

EFFECTIVE DATE: January 1, 2009

Budget and Compensation

The act requires the board's budget, upon approval of its members, to pay its reasonable expenses. Board members receive a $200 per diem payment.

Board Member Qualifications

Within five consecutive years of the 10 years immediately preceding their appointment, board members must have been educated or trained or had experience in one or more of the following areas:

1. procurement;

2. contract negotiation, selection, and drafting;

3. competitive bidding and proposal procedures;

4. real estate transactions, including real estate and building purchases, sales, and leases;

5. business insurance and bonding;

6. building construction and architecture;

7. ethics in public contracting;

8. federal and state laws, procurement policies, and regulations;

9. outsourcing and privatization analysis;

10. small and minority business enterprise development;

11. engineering and information technology;

12. human services;

13. personnel and labor relations; or

14. contract risk assessment.

“Contract risk assessment” means (1) the identification and evaluation of loss exposures and risks, including business and legal risks associated with contracting, and (2) the identification, evaluation, and implementation of measures available to minimize potential loss exposures and risks.

Board Staff

The act authorizes the board to (1) employ any staff it considers necessary and (2) contract with consultants and professionals on a temporary or project basis.

It requires the governor to appoint and the legislature to confirm an executive director who serves as an ex-officio, nonvoting board member. The executive director may contract as necessary to carry out his or her duties. The board must annually evaluate the executive director's performance and may remove him or her for cause. The executive director reports to the board's chairperson. The board must appoint a chief procurement officer (CPO) for a term not to exceed six years, unless reappointed. The CPO reports to, is annually evaluated by, and serves at the pleasure of the board. For administrative purposes only, the executive director supervises the CPO.

In consultation with the CPO, the executive director must:

1. prepare a comprehensive plan of the board's administrative functions,

2. coordinate the board's budget and personnel activities,

3. provide for the board's administrative organization to be examined for economy and efficiency,

4. act as the board's external liaison, and

5. perform any other duties the chairperson or board assigns, as appropriate.

The CPO is responsible for carrying out the board's policies relating to procurement, including oversight, investigation, auditing, agency procurement certification, procurement and project management training, and enforcement. He or she also ensures that state contracting agencies apply the policies when they screen and evaluate current and prospective contractors. The CPO may contract as necessary for the discharge of his or her duties, including recommending best practices and assisting state agencies that the board determines are violating the act.

The CPO must also:

1. oversee state contracting agencies' compliance with statutes and regulations concerning procurement;

2. monitor and assess each agency's procurement officer's performance;

3. administer a certification system (see below) and monitor compliance with procurement statutes and regulations, including the education and training, performance, and qualifications of agency procurement officers;

4. review and monitor the procurement processes of each state contracting agency, quasi-public agency, and institution of higher education; and

5. serve as chairperson of the Contracting Standards Advisory Council and an ex-officio member of the Vendor and Citizen Advisory Panel (see below).

Board Ethics and Operations

The act prohibits board members and staff from having a state or municipal position. It also prohibits board non-clerical staff, or their spouse, child, stepchild, parent, or sibling from having an association with any business that does business with the state. An associated business is one owned by an official, employee, or immediate family member, or in which any one of them (1) serves as an officer, director, or compensated agent or (2) owns at least 5% of the stock in any class.

It requires board members and employees to file with the board and the Office of State Ethics, by May 1 annually, a statement of financial interest required by the State Ethics Code. The financial statement is a public record and subject to disclosure under the Freedom of Information Act (FOIA).

Any board employee who violates the employment prohibition and any board employee or member who fails to file the statement violates the State Ethics Code and may be subject to the code's penalties, including a fine of up to $10,000.

The act requires the board to adopt any rules it deems necessary to conduct its internal affairs, including appellate rules of procedure and reviews of appeals by bidders.

Powers and Duties

The act permits the board to exercise the rights, powers, duties, and authority related to the state's procurement policies, now vested in, or exercised by, any state contracting agency. These consist of the right, power, duty, or authority:

1. to acquire, manage, control, warehouse, sell, and dispose of supplies, services, and construction;

2. related to any state contracting or procurement processes, including, leasing and transferring property; purchasing or leasing supplies, material, or equipment; retaining consultants or consultant services; making service agreements; or arranging privatization contracts; and

3. related to public building construction contracts.

“Consultant Services” are professional services rendered by architects; professional engineers; landscape architects; land surveyors; accountants; interior designers; environmental professionals; planners; and people who perform professional work such as educational and medical services, information technology, and real estate appraisals.

Upon the board's request, each state contracting agency must give the board procurement information in a timely manner. The act gives the board access to all information, files, and records related to any state contracting agency. The act specifies that it does not require the board to publicly disclose records exempt from disclosure under FOIA.

Unless the board's actions show otherwise, its authority does not limit or restrict the rights, powers, or authority of the contracting agency.

Board's Oversight of Procurement Practices

Except as otherwise provided by law, the board is responsible for:

1. recommending the repeal of repetitive, conflicting, or obsolete state procurement laws;

2. making recommendations regarding information systems for state procurement including data element and design and the state contracting portal;

3. develop a guide to state statutes and regulations concerning procurement for use by all state contracting agencies;

4. helping state contracting agencies comply with state laws and regulations by providing guidance, models, advice, and practical assistance to their staff related to (a) buying the best service at the best price; (b) properly selecting contractors; and (c) drafting contracts that achieve state goals of accountability, transparency, and results-based outcomes and protect taxpayers' interests; and

5. adopting regulations and policies to carry out state procurement laws in order to facilitate consistent application and require the implementation of best procurement practices.

Review Procurement Legislation, Regulations, and Policies. The board must review and make recommendations concerning proposed legislation and regulations on procuring, managing, controlling, and disposing of supplies, services, and construction, including:

1. prequalification, suspension, debarment, and reinstatement of prospective bidders and contractors;

2. small purchase procedures;

3. conditions and procedures for delegating procurement authority, procuring perishables and items for resale, using source selection methods authorized by statute or regulation, making emergency procurements, and selecting contractors by processes or methods that restrict full and open competition;

4. opening or rejecting bids and offers and waiving errors in bids and offers;

5. confidentiality of technical data and trade secrets submitted by actual or prospective bidders;

6. partial, progressive, and multiple awards;

7. supervision of storerooms and inventories, including determining appropriate stock levels and the management, transfer, sale, or other disposal of publicly owned supplies;

8. definitions and classes of contractual services and procedures for acquiring them;

9. regulations for conducting cost and price analysis;

10. use of payment and performance bonds;

11. guidelines for using cost principles in negotiations, adjustments, and settlements; and

12. identifying procurement best practices.

The board must give the governor and the Government Administration and Elections Committee recommendations concerning procurement statutes and regulations.

Board to Coordinate Procurement and Contracting Officers. The board must train and oversee procurement and contracting officers in each state contracting agency.

The act requires the head of each state contracting agency to appoint an agency procurement officer to act as a liaison between the agency and the CPO on the agency's procurement activities. The activities include (1) implementing and complying with statutes and regulations on procurement and any policies or regulations the board adopts and (2) coordinating the training and education of agency procurement employees.

The agency procurement officer must assure that contractors are properly screened before a contract is awarded, evaluate their performances during and at the end of a contract, submit written evaluations to a central data repository that the board designates, and create a project management plan that includes annual reports to the board on the agency's procurement projects.

Agency Procurement Certification

Beginning January 1, 2009, the act requires the board to review and certify that a state contracting agency's procurement processes comply with procurement statutes and regulations. It must accomplish this by:

1. establishing procurement and project management education and training criteria;

2. certifying agency procurement and contracting officers; and

3. approving, in consultation with the Office of State Ethics, an ethics training course, including a course for state employees involved in procurement and prequalifying state contractors and substantial subcontractors.

The Office of State Ethics or any person, firm, or corporation may develop and provide the training, but the board must approve the course.

Employees must maintain the certification in good standing at all times while performing procurement functions.

The board must recertify each state contracting agency's procurement processes at least every three years, notify them of any certification deficiency, and exercise its enforcement authority if it finds noncompliance.

Contract Data Reporting

The act requires the board to “define the contract data reporting requirements to the board for state agencies. ” Although it is unclear what this actually means, it may mean that the board must inform state agencies of their duties to report data on:

1. the number and type of state contracts that each state contracting agency has in effect statewide;

2. their client agencies;

3. contractors' names;

4. the contracts' terms and dollar values;

5. services purchased under such contracts;

6. their evaluations of contractors' performances, including records on suspensions or disqualifications and assurances that the information is available on the state contracting portal; and

7. all contracts and contractors awarded without full and open competition, including the reasons for the decisions and the names of the authorities that approved them.

Procurement and Project Management Training

The SCSB, with the advice and assistance of the DAS commissioner, must develop a standardized state procurement and project management education and training program. The board must adopt implementing regulations.

The program must develop education, training, and professional development opportunities for state contracting agency employees with procurement responsibilities. It must educate the employees on general business acumen and proper purchasing procedures as established in procurement statutes and regulations. The program must emphasize ethics, fairness, consistency, and project management.

The program must include:

1. training and education in federal, state, and municipal procurement processes, including the state procurement statutes and regulations and principles of project management;

2. training and education courses developed in cooperation with the Office of State Ethics, Freedom of Information Commission, State Elections Enforcement Commission, Commission on Human Rights and Opportunities, Attorney General's Office, and any other state agency the board determines is necessary;

3. technical assistance to help state contracting agencies, quasi-public agencies, constituent units of higher education, and municipalities implement procurement statutes and regulations and regulations, policies, and standards the board develops;

4. training current and prospective contractors, vendors, and others seeking to do business with the state; and

5. training and education for state employees in best procurement practices in state purchasing with the goal of achieving the level of acumen necessary to achieve the objectives of state statutes and regulations.

The act requires state contracting agency employees responsible for buying, purchasing, renting, leasing, or otherwise acquiring any supplies, services, or construction to participate in the program. The board must give employees who complete the program a certificate acknowledging their participation. It must give the governor and legislature an annual status report on the training and education program.

§ 6 — COMPLIANCE AUDITS

The act requires the board to audit state contracting agencies at least once every three years and report on their compliance with procurement statutes and regulations. During the audit, the act gives the board access to all of the agencies' contracting and procurement records and authority to interview people responsible for awarding and negotiating contracts or procurement. The board can contract with the state auditors to conduct the audit.

The board must identify in the compliance report (1) any process or procedure that is inconsistent with procurement laws and regulations and (2) corrective measures to achieve compliance. It must deliver the report, which is a public record, to the contracting agency within 30 days after the audit is completed.

EFFECTIVE DATE: October 1, 2011

§ 7 — DISCIPLINARY ACTIONS FOR NONCOMPLIANCE AND OTHER VIOLATIONS

The board may review, terminate, or recommend to a state contracting agency terminating a contract or procurement agreement, for cause, after consulting with the attorney general and giving the agency and contractor 15 days notice. “For cause” means (1) engaging in activities prohibited under the State Ethics Code as determined by the Citizen's Ethics Advisory Board; (2) wanton or reckless disregard of any state contracting and procurement process by anyone substantially involved in the contract or with the state contracting agency; or (3) notification from the attorney general to the state contracting agency that a whistleblower investigation indicates that the contract process was compromised by fraud, collusion, or any other criminal violation.

Before terminating a contract, the board must (1) consult with the contracting agency to determine the impact of an immediate termination and (2) jointly decide with the agency that immediate termination will not cause imminent peril to public health, safety, or welfare. The board's decision to terminate must be approved by a two-thirds vote of its members present and voting, including at least one member appointed by a legislative leader. The board must notify the state contracting agency and the contractor of the opportunity for a hearing under the Uniform Administrative Procedure Act (UAPA).

The board may (1) restrict or terminate a state contracting agency's contracting or procurement authority or (2) recommend that a state contracting agency restrict or terminate an employee's or agent's authority to enter a contract or procurement agreement. Before taking this action, the board must (1) find that the agency or employee failed to comply with statutory contracting and procurement requirements and showed a reckless disregard for applicable policies and procedures; (2) provide 15 days notice and a hearing; and (3) decide the matter upon a two-thirds vote, including at least one vote by a member appointed by a legislative leader. Any restriction or termination stays in effect until the agency implements corrective measures and complies with procurement laws and regulations. Any agency restriction or termination must be in the state's best interest. The board must arrange for the exercise of the agency's contracting power during the restriction or termination.

This section does not limit the board's authority to perform compliance audits.

EFFECTIVE DATE: October 1, 2011

§ 8 — CONTRACTING STANDARDS ADVISORY COUNCIL

The act establishes a Contracting Standards Advisory Council consisting of the CPO who serves as chairperson and representatives from the Office of Policy and Management; the departments of Transportation, Administrative Services, Public Works, and Information Technology; and three other contracting agencies that the governor designates, including one human services-related state agency.

The council must meet at least four times a year to discuss state procurement issues and recommend improvements to the procurement process to the SCSB. It may conduct studies, research, and analyses and make reports and recommendations with respect to matters within SCSB's jurisdiction.

EFFECTIVE DATE: January 1, 2009

§ 9 — VENDOR AND CITIZEN ADVISORY PANEL

The act establishes a 15-member Vendor and Citizen Advisory Panel. The governor appoints three members and the six top legislative leaders each appoint two. No more than six members can be vendors experienced in state procurement. The remaining nine must be citizen members with education, training, or experience, received in five consecutive years of the 10 years immediately preceding their appointment, in one or more of the following areas:

1. government procurement;

2. contract negotiation, drafting, and management;

3. contract risk assessment;

4. preparing requests for proposals, invitations to bid, and other procurement solicitations;

5. evaluating proposals, bids, and quotations;

6. real property transactions;

7. business insurance and bonding;

8. the State Code of Ethics;

9. federal and state laws, policies, and regulations;

10. outsourcing and privatization proposal analysis;

11. government taxation and finance;

12. small and minority business enterprise development;

13. collective bargaining; and

14. human services.

The CPO chairs the panel and serves as an ex-officio member. The panel makes recommendations to the board on best practices in state procurement processes and project management and other issues pertaining to system stakeholders.

EFFECTIVE DATE: January 1, 2009

§ 10 — SCSB LEGISLATION ON APPLICATION OF PROCUREMENT LAWS AND REGULATIONS

By July 1, 2010, the board must submit to the governor and legislature necessary legislation to permit state contracting agencies, other than quasi-public agencies and institutions of higher education, to comply with procurement laws and regulations.

Within the next year, the board must submit legislation necessary to have (1) procurement statutes apply to constituent units of higher education and (2) privatization and procurement statutes and regulations apply to quasi-public agencies.

By July 1, 2012, the board must submit legislation to the governor and legislature necessary to apply procurement statutes and regulations to municipalities when state funds are involved.

EFFECTIVE DATE: January 1, 2009

§ 11 — SCSB ASSISTANCE TO STATEWIDE OFFICERS

The board must help the secretary of the state, comptroller, treasurer, and attorney general develop the best procurement practices specific to their constitutional and statutory functions and consistent with procurement statutes and regulations. Each of the statewide officers must adopt a procurement code on or before June 1, 2011.

EFFECTIVE DATE: January 1, 2009

§ 12 — JUDICIAL AND LEGISLATIVE PROCUREMENT CODES

By February 1, 2011, the act requires the Judicial and Legislative branches to each prepare a procurement code for their use when contracting for, buying, renting, leasing, or otherwise acquiring or disposing of supplies, equipment, or services, including consultant, personal, and construction services.

By the same date, the Judicial Branch must submit its code to the Judiciary Committee for review and approval.

The codes must:

1. establish uniform contracting standards and practices;

2. ensure the fair and equitable treatment of all businesses and people involved in the procurement system;

3. include a process for maximizing the use of small contractors and minority business enterprises;

4. provide increased economy in procurement activities and maximize purchasing value to the fullest extent possible;

5. ensure that they procure supplies, materials, equipment, services, real property, and construction in a cost-effective and responsive manner;

6. include a process to ensure accountability between contractors and each branch;

7. simplify and clarify contracting standards and procurement policies and practices, including procedures for competitive sealed bids or proposals; small purchases; and sole source, special, and emergency procurements; and

8. provide a process for competitive sealed bids and proposals; small purchases; sole source, emergency, and special procurements; best-value selection; and qualification-based selection, and the conditions for their use.

“Best-value selection” means a process to award contracts based on quality, timeliness, and costs. “Qualification-based selection” means a process to award contracts based primarily on contractor qualifications and a fair and reasonable price. “Emergency procurements” are those necessary because of a sudden, unexpected occurrence that (1) poses a clear and imminent danger to public safety or requires immediate action to prevent or reduce loss or impairment of life, health, property, or essential public services or (2) is needed in response to a court order, settlement agreement, or other similar legal judgment.

EFFECTIVE DATE: January 1, 2009

§ 13 — STATE CONTRACTING PORTAL

The act requires DAS to work with the SCSB to establish and maintain on its website a single electronic portal of all contracting opportunities with Executive Branch state agencies, the constituent units of higher education, and quasi-public agencies. The portal must be called the “State Contracting Portal. ” It must at a minimum include:

1. all requests for bids or proposals, other solicitations, related material, and all resulting contracts and agreements;

2. a searchable database for locating information;

3. executed personal service agreements and purchase of service contracts;

4. any document DAS designates that describes approved contracting processes and procedures; and

5. prominent features to encourage small businesses and women-and minority-owned enterprises to participate in the state contracting process.

All Executive Branch agencies, constituent units of higher education, and quasi-public agencies must (1) post all bids, requests for proposals, and all resulting contracts and agreements on the portal and (2) develop written policies and procedures to ensure that information posted on the portal is timely, complete, and accurate as determined by the highest legal and ethical standards of state government. They must, with the assistance of DAS and the Department of Information Technology as needed, develop the infrastructure and capability to communicate electronically with the portal.

DAS must give the governor and the SCSB periodic progress reports on (1) the agencies' and units' development of the capacity, infrastructure, policies, and procedures necessary to communicate electronically with the portal and (2) DAS' progress in establishing and maintaining the portal.

EFFECTIVE DATE: January 1, 2009

§ 14 — ACCOUNTABILITY AND TRANSPARENCY

Beginning June 1, 2010, the act requires all Legislative Branch, Judicial Branch, and state contracting agency contracts that take effect on or after that date to contain provisions to ensure accountability, transparency, and results-based outcomes. State contracting agency contracts must contain the outcomes prescribed by the SCSB.

EFFECTIVE DATE: January 1, 2009

§ 16— PRIVATIZATION

Before privatizing any state service that is not currently privatized, a state contracting agency must develop a cost-benefit analysis and a business case. For the purpose of this section, “state contracting agencies” are Executive Branch agencies and constituent units of higher education. Any affected party may petition the SCSB to review the contract. The requirement does not apply (1) to a privatization contract for a service currently provided at least in part by a non-state entity or (2) if the state contracting agency determines the contract is required because of an imminent peril to public health, safety, or welfare and (a) the agency states, in writing, its reasons for such finding and (b) the governor approves the finding in writing.

This section does not apply to procurements that involve the expenditure of federal assistance or contract funds if federal law provides procurement procedures are inconsistent with state procurement statutes or regulations.

EFFECTIVE DATE: January 1, 2010

Cost-Benefit Analysis

The cost-benefit analysis must document the direct and indirect costs, savings, and qualitative and quantitative benefits of the privatization contract. The analysis must (1) specify the minimum schedule required to achieve any estimated savings and (2) clearly identify any cost factor. Cost factors must be supported by all applicable records and reports. The state contracting agency's head must certify that, based on the data and information, all projected costs, savings, and benefits are valid and achievable. “Costs” means all reasonable, relevant and verifiable expenses, including salary, materials, supplies, services, equipment, capital depreciation, rent, maintenance, repairs, utilities, insurance, travel, overhead, interim and final payments and the normal cost of fringe benefits, as calculated by the comptroller. “Savings” means the difference between the current annual direct and indirect costs of providing the service and the projected, annual direct and indirect costs of contracting to provide them in any succeeding state fiscal year during the term of the proposed privatization contract.

If the cost-benefit analysis finds a cost savings of less than 10%, that the contract will not diminish the quality of services, and a significant public policy reason to privatize, the state contracting agency may develop a business case to evaluate the feasibility of entering the contract and to identify its potential results, effectiveness, and efficiency. If the cost savings is at least 10% and the contract will not diminish the quality of services, the agency must develop a business case.

If the contract would result in at least 100 layoffs, transfers, or reassignments, after consulting with unions, the contracting agency must notify the affected employees after the cost-benefit analysis is completed, give them the opportunity to reduce the costs of providing the services to be privatized, and give them resources to encourage and help them organize and bid on the contract. (It is not clear the effect this provision has on existing law that makes certain subjects, such as wages and hours, mandatory subjects of collective bargaining. )

Business Case

Any business case must include:

1. the cost-benefit analysis;

2. a detailed description of the service or activity that is the subject of the business case;

3. a description and analysis of the state contracting agency's current performance of the service or activity;

4. the goals to be achieved through the proposed privatization contract and the rationale for them;

5. a description of available options for achieving these goals;

6. an analysis of the advantages and disadvantages of each option, including potential performance improvements and the risks of terminating or rescinding the contract;

7. a description of the current market for the services or activities that are the subject of the business case;

8. an analysis of the quality of services as determined by standardized measures and key performance requirements, including compensation, turnover, and staffing ratios;

9. a description of the specific results-based performance standards that must be met to ensure adequate performance by any party performing the service or activity;

10. the projected time frame for key events from the beginning of the procurement process through the contract's expiration, if applicable;

11. a specific and feasible contingency plan that addresses contractor nonperformance and a description of the tasks involved in and costs required for implementing the plan; and

12. a transition plan, if appropriate, for addressing changes in the number of agency personnel, affected business processes, employee transition issues, and communications with affected stakeholders, such as agency clients and members of the public, if applicable.

The transition plan must contain a reemployment and retraining assistance plan for employees who are not retained by the state or employed by the contractor.

If the primary purpose of the proposed privatization contract is to provide a core governmental function, the business case must also include information sufficient to rebut the presumption that the core governmental function should not be privatized. The presumption cannot be construed to prohibit a state contracting agency from contracting for specialized technical expertise not available within the agency; however, the agency must retain responsibility for the core governmental function. A “core governmental function” is one whose primary purpose is (A) to inspect for adherence to health and safety standards because public health or safety may be jeopardized if the inspection is not done or is not done in a timely or proper manner; (B) to establish statutory, regulatory, or contractual standards for a regulated person, entity, or state contractor; (C) to enforce public health or safety statutory, regulatory, or contractual requirements; or (D) criminal or civil law enforcement. If any part of the business case is based on evidence that the state contracting agency is not sufficiently staffed to provide the core governmental function required by the privatization contract, the state contracting agency must also include within the business case a plan to remediate the understaffing to allow the agency to provide the services directly in the future.

Review by SCSB

Once the business case is completed, the state contracting agency must submit it to the SCSB. The SCSB cannot engage in any ex parte communications with a lobbyist, contractor, or union representative during the review. Each state contracting agency that submits a business case for review must give the board all information, documents, or other material the privatization contract committee requires to complete its review and evaluation of the business case. If the privatization contract is projected to cost more than $150 million annually or $600 million over its term, the state contracting agency must also submit the business case to the governor, the Senate president pro tempore, the House speaker, and any collective bargaining unit affected by the proposed contract.

SCSB Privatization Contract Committee

When the SCSB receives a business case from a state contracting agency, it must immediately refer it to a privatization contract committee that consists of five SCSB members appointed by the board's chairperson. The members must represent both gubernatorial and legislative appointments and no more than three members may represent any one political party. At least one member must be an expert in the area that is the subject of the proposed contract. The SCSB chairperson or his or her designee must head the committee.

The committee must employ a standard process for reviewing, evaluating, and approving business cases. The process must include due consideration of: (1) the state contracting agency's cost-benefit analysis; (2) the agency's business case, including any facts, documents, or other materials that are relevant to it; (3) any adverse effect that the privatization contract may have on minority, small, and women-owned businesses that do, or are attempting to do business with the state; and (4) the value of having services performed in the state and within the United States.

The privatization committee must evaluate the business case and submit its evaluation to the SCSB for review and approval. During the review or consideration, no board member can engage in any ex parte communication with any lobbyist, contractor, or union representative.

SCSB Approval of Business Case

Within 60 days after receiving a business case, the SCSB must transmit a report detailing its review, evaluation, and disposition to the state contracting agency that submitted it. In the case of a privatization contract with a projected cost of at least $150 million dollars annually or $600 million dollars over its life time, SCSB must also send the report to the governor, the Senate president pro tempore, the House speaker, and any collective bargaining unit affected by the proposed contract. The 60 days may be extended for an additional 30 days upon a majority vote of the board or the privatization contract committee and for good cause shown. A business case is deemed approved if the SCSB does not act on it within the 60 days, except that no business case may be approved because the board fails to meet.

The board's report must include the business case, the privatization contract committee's evaluation, its reasons for approval or disapproval, any recommendations of the board, and sufficient information to help the state contracting agency determine if additional steps are necessary to proceed with a privatization contract.

Generally, a majority vote of the board is required to approve a business case. However, a two-thirds vote, including the vote of at least one board member appointed by a legislative leader, is required to approve a business case to privatize a core governmental function. Before approval, the state contracting agency must provide sufficient evidence to rebut the presumption that the core governmental function should not be privatized and there is a significant policy reason to approve the business case. In no case can a state contracting agency's staffing level constitute a significant policy reason to approve a business case for privatizing a core governmental function.

Any state contracting agency may request an expedited review if there is a compelling public interest for doing so. If the board approves the agency's request, the review must be completed not later than 30 days after receipt. If the board fails to complete an expedited review within the 30 days, the business case is deemed approved.

The state contracting agency retains sole discretion in determining whether to proceed with the privatization contract if the SCSB approves the business case.

Amendments to SCSB-Approved Business Cases

Each state contracting agency must submit to SCSB, in writing, any proposed amendment to a board-approved business case so that the board may review and approve it. The board may approve or disapprove the proposed amendment within 30 days after receipt by the same vote that was required to approve the original business case. If the board fails to complete its review within 30 days, the amendment is deemed approved.

Solicitations for Privatization Contracts

A state contracting agency may publish notice soliciting bids for a privatization contract only after the board approves the business case. A contract that is estimated to cost over $150 million dollars annually or $600 million or more over its life must also be pre-approved by the legislature. The legislature, by a majority vote in either chamber, must either reject or approve the contract in its entirety. If the legislature is in session, it must approve or reject the contract within 30 days after it is filed. If the legislature is not in session when the contract is filed, the contract must be submitted not later than 10 days after the first day of the next regular session or special session called for that purpose.

A contract is deemed approved if the legislature fails to vote to approve or reject it within the 30 days, which period cannot begin or expire unless the legislature is in regular session. Any contract filed with the clerks within 30 days before the start of a regular session is deemed to be filed on the first day of such session.

Recourse By Adversely Affected Employees

Not later than 30 days after the board decides to approve a business case, the collective bargaining agent of any employee adversely affected by the proposed privatization contract may file a motion for an order to show cause in Hartford Superior Court on the grounds that the contract fails to comply with the act's substantive or procedural requirements regarding privatization. The court may: (1) deny the motion, (2) grant the motion if it finds that the proposed contract would substantively violate the act's privatization provisions, or (3) stay the effective date of the contract until any substantive or procedural defect has been corrected.

SCSB's Review of Existing Privatization Contracts

The SCSB may review existing privatization contracts and must review at least one currently privatized contracting area each year. For each privatization contract that the board selects for review, the appropriate state contracting agency must develop a cost-benefit analysis. Any affected party may petition the board to review the business case of any existing privatization contract. The SCSB cannot engage in any ex parte communications with a lobbyist, contractor, or union representative during the review.

If the cost-benefit analysis identifies cost savings of at least 10% and the contract does not diminish the quality of the service provided, the state contracting agency must develop a business case to renew the contract. The board must review the contract just as it does proposed privatization contracts and may approve the renewal by the applicable vote of the board. Any renewal that is estimated to cost over $150 million annually or $600 million dollars or more over its life must also be pre-approved by the General Assembly. If the renewal is approved by the board and the General Assembly, if applicable, the act's provision on proposed amendments applies.

If the cost-benefit analysis identifies a cost savings of less than 10%, the state contracting agency must prepare and begin to implement a plan to have the service provided by state employees. However, (1) after the plan is prepared, but before it is implemented, the state contracting agency may develop a business case for the privatization contract that achieves at least a 10% cost savings and must submit the plan to the SCSB for review and approval; (2) the privatization contract cannot be renewed with the vendor currently providing the service unless there is a significant public interest in doing so and the renewal is approved by a two-thirds vote of the board, including the vote of at least one member appointed by a legislative leader; (3) until the state contracting agency implements the plan, it may contract for the services for up to one year; and (4) funds may be transferred from the General Fund to allocate necessary resources to carry out this provision upon the governor's recommendation and after approval of the Finance Advisory Committee.

Renewal of a privatization contract with a nonprofit organization cannot be denied if the cost of increasing compensation to employees performing the privatized service is the only reason for the contract not achieving at least a 10% cost savings. A “nonprofit” is a not-for-profit business under § 501 (c) (3) of the Internal Revenue Code of 1986 or any subsequent corresponding code as amended.

Policies and Procedures

The Office of Policy and Management, in consultation with the SCSB, must: (1) develop policies and procedures, including templates for state contracting agencies to use when developing a cost-benefit analysis and (2) review with each state contracting agency the budgetary impact of any privatization contract and the need to request budget adjustments in connection with it.

The SCSB, in consultation with the DAS, must: (1) recommend and implement standards and procedures for state contracting agencies to develop business cases in connection with privatization contracts, including templates for them to use when submitting business cases to the board, and policies and procedures to help state contracting agencies complete the cases and (2) develop guidelines and procedures for helping state employees whose jobs are affected by a privatization contract.

§§ 15 & 17 — APPLICATION

The act, other than the provisions establishing and outlining the general duties of the SCSB (§§ 1-15), applies to all contracts state contracting agencies solicit or enter after the January 1, 2010. The SCSB provisions do not affect the four-year pilot program that creates jobs for people with disabilities established under PA 06-129.

Unless otherwise stated, the act's privatization and procurement procedures (§§ 16-47) apply to every expenditure of public funds by any state contracting agency, irrespective of their source, involving any state contracting and procurement processes, including leasing and property transfers; purchasing or leasing of supplies, materials, or equipment; consultant or consultant services; personal service and purchase of service agreements; privatization contracts; and contracts for the construction, reconstruction, alteration, remodeling, repair, or demolition of any public building, bridge, or road.

The act's privatization and procurement procedures cannot be construed to apply to the expenditure of federal assistance or contract funds if federal law provides procurement procedures that are inconsistent with state procurement statutes or regulations.

EFFECTIVE DATE: June 1, 2010, except the provision on the pilot program, which is effective January 1, 2009.

§ 18 —REQUISITION SYSTEM

The act requires the DAS commissioner to establish a requisition system for use by state contracting agencies to initiate and authorize the procurement process when obtaining supplies, materials, equipment, or contractual services, except infrastructure facilities. The SCSB must approve the system.

EFFECTIVE DATE: June 1, 2010

§ 19 — PROCUREMENT METHODS

The act requires that all state contracting agencies' purchases of, and contracts for, supplies, materials, equipment, and contractual services made under the competitive bidding process, be awarded by one of the following methods unless otherwise authorized by law:

1. competitive sealed bidding,

2. competitive sealed proposals,

3. small purchase procedure,

4. sole source procurement,

5. emergency procurement, or

6. waiver of bid or proposal requirement for extraordinary conditions.

EFFECTIVE DATE: October 1, 2009

§§ 29 & 30 — INSPECTIONS AND AUDITS

State contracting agencies' contracts must permit the agencies, at reasonable times, to inspect the part of the plant or place of business of a contractor or any subcontractor that is related to the performance of any contract awarded, or to be awarded by the state, to ensure compliance with the contract.

State contracting agencies may audit the books and records of a contractor or subcontractor under any negotiated contract or subcontract to the extent that the books and records relate to the performance of the contract or subcontract. The contractor must maintain the books and records for three years from the date of final payment under the prime contract and the subcontractor for a period of three years from the expiration of the subcontract.

EFFECTIVE DATE: January 1, 2009

§ 31— ANTICOMPETITIVE PRACTICES AMONG BIDDERS

When an affected party suspects collusion or other anticompetitive practices among any bidders or proposers for a state contract, the party must give the attorney general notice of the relevant facts. Affected parties include the state contracting agency or a bidder or proposer. A proposer is a business submitting a proposal in response to a request for proposals or other competitive sealed proposal by a state contracting agency.

EFFECTIVE DATE: January 1, 2009

§§ 25, 32 & 33— RECORD REQUESTS AND RETENTION

The act permits state contracting agencies to request factual information reasonably available to bidders or proposers to substantiate the reasonableness of offered prices or costs. Under the act, each state contracting agency must retain and dispose of all procurement records in accordance with the public records administrator's records retention guidelines and schedules.

The act requires the agency procurement officer to maintain a record listing all contracts made under the uniform procurement code for a minimum of five years. The record must contain:

1. each contractor's name;

2. the amount and type of each contract; and

3. a list of the supplies, services, or construction procured under each contract.

All procurement records must be retained and disposed of in accordance with the public records administrator's records retention guidelines and schedules.

EFFECTIVE DATE: January 1, 2009, except that the provision on the agency procurement officer is effective on June 1, 2010.

§ 34 — DISQUALIFICATIONS

General Provisions

The act allows the SCSB to disqualify any contractor, bidder, or proposer from bidding on, applying for, or participating as contractor or subcontractor under state contracts. The disqualification can run for up to five years.

In order to disqualify a contractor, bidder, or proposer, the board must (1) consult with the relevant contracting agency and the attorney general; (2) provide reasonable notice and hold a hearing; and (3) act through a subcommittee of three members, including at least one legislative appointee, appointed by the board's chairperson. In determining whether to disqualify a contractor, bidder, or proposer, the board must consider the seriousness of the affected party's acts or omissions and any mitigating factors.

The subcommittee must issue a written recommendation within 60 days after its hearing ends. The recommendation must state the reasons for the subcommittee's action and the length of any disqualification. A disqualification recommendation requires the vote of two subcommittee members present and voting. The subcommittee must submit the recommendation to the board for action and mail it to the contractor by certified mail, return receipt requested. Once the board receives the subcommittee's recommendations, but no later than 30 days after receiving any comments from the targeted contractor, it must issue a written decision adopting, rejecting, or modifying them. The board must mail the decision to the contractor by certified mail, return receipt requested. The decision is final and can be appealed to Superior Court.

EFFECTIVE DATE: June 1, 2010

Grounds for Disqualification

Under the act, the grounds for disqualification include:

1. conviction of, or entry of a plea of guilty or nolo contendere (no contest) or admission to (a) the commission of a crime in connection with obtaining or attempting to obtain a public or private contract or subcontract, or in the performance of a contract or subcontract; (b) the violation of any state or federal law for embezzlement, theft, forgery, bribery, falsification or destruction of records, receiving stolen property, or other offenses indicating a lack of business integrity or honesty that affects responsibility as a contractor; or (c) a violation of any state or federal antitrust, collusion, or conspiracy law arising from the submission of bids or proposals on a public or private contract or subcontract;

2. accumulation of two or more agency suspensions within a 24-month period;

3. a willful, negligent, or reckless failure to meet the terms of one or more state contracts or subcontracts, agreements, or transactions;

4. a history of failure to perform, or of unsatisfactory performance, on one or more state contracts, agreements, or transactions;

5. a willful violation of a statutory or regulatory provision or requirement applicable to a state contract, agreement, or transaction;

6. a willful or egregious violation of State Ethics Code provisions on prohibited activities and prohibited activities by consultants and independent contractors as determined by the Citizen's Ethics Advisory Board; or

7. any other cause or conduct the board determines to be so serious and compelling as to affect responsibility as a state contractor.

The last category includes: (1) disqualification by another state for cause; (2) the existence of an informal or formal business relationship with a contractor who has been disqualified from bidding or proposing on state contracts of any state contracting agency; and (3) the fraudulent or criminal conduct of any officer, director, shareholder, partner, employee, or other individual associated with a contractor, bidder, or proposer if the conduct was connected with the individual's performance of duties for, or on behalf of, the contractor, bidder, or proposer who knew or had reason to know of the conduct.

Modification of Disqualification

The act allows the board to reduce the period or the extent of a disqualification at the written request of a contractor, bidder, or proposer. It may do so if the affected party provides supporting documentation of:

1. newly discovered material evidence;

2. a reversal of the conviction upon which the disqualification was based;

3. a bona fide change in ownership or management; or

4. the elimination of other causes for which the disqualification was imposed.

§ 35 — AGENCY SUSPENSIONS

The act allows the department head of any state contracting agency, after reasonable notice and a hearing, to suspend any contractor, bidder, or proposer for up to six months from bidding on, applying for, or performing work as a contractor or subcontractor under state contracts. The department head must issue a written decision within 90 days after the hearing ends, which must state the reasons for the action taken and the length of any suspension. In determining whether to suspend a contractor, bidder, or proposer, the department head must consider the seriousness of the acts or omissions and any mitigating factors. The department head must send the decision to the contractor and the SCSB by certified mail, return receipt requested. The decision is final and can be appealed to Superior Court.

The causes for suspension include:

1. failure without good cause to perform in accordance with specifications or within the time limits provided in the contract;

2. a record of failure to perform or of unsatisfactory performance in accordance with the terms of one or more contracts, other than those caused by acts beyond the control of the contractor, bidder, or proposer;

3. any cause the contracting agency determines to be so serious and compelling as to affect the responsibility of a state contractor, bidder, or proposer, including suspension by another contracting agency for cause; or

4. a violation of the State Ethics Code's ethical standards as determined by the Citizen's Ethics Advisory Board.

The act allows the SCSB to grant an exception permitting a suspended contractor to participate in a particular contract or subcontract upon its written determination that there is good cause for the exception and the exception is in the state's best interest.

Each state department head must review contractors and file reports pertaining to any of the reasons under the act that may be the basis for “disqualification” (the act refers to disqualification but this section deals with suspensions).

EFFECTIVE DATE: June 1, 2010

§§ 37 & 38 — APPEALS FROM AGENCY'S SUSPENSION DECISIONS

The act permits contractors, bidders, or proposers to appeal an SCSB subcommittee's suspension decision to the full board within 14 days after receiving it. Each bidder or proposer must state the facts supporting its claim in enough detail for the SCSB to determine whether procedural elements of the solicitation or award failed to comply with the code or whether an unauthorized or unwarranted, noncompetitive selection process was used. (An incorrect internal citation establishes a procedure for appealing the way a contract is awarded rather than one for appealing an agency's decision to suspend a contractor, which was apparently the intention). The appeal does not automatically prohibit the award or execution of the contested contract.

The act requires the SCSB to create a subcommittee of three of its members, including one legislative appointee, to review these appeals and vote on whether an allegation has been substantiated. The appeals committee may not include any SCSB member who originally heard the case. Unless the subcommittee's vote is unanimous, the full board must review the appeal and dispose of it by a vote of two-thirds of its members present and voting, including at least one legislative appointee. (The act does not specify what happens if the full board's vote is less than two-thirds. ) And any three board members may request that the full board review an agency's deliberative or awards process.

The subcommittee, or the full board in the event of a split vote, must issue a written decision, or take other appropriate action, on each appeal and provide a copy of any decision to the bidder or proposer. The subcommittee must act within 90 days after receiving the appeal. The full board must act within 90 days after receiving the appeal from the subcommittee. If the subcommittee or full board decides in the bidder's or proposer's favor, the board must direct the state contracting agency to take corrective action within 30 days after the decision date. A decision by the full board or the appeals review committee is final and not subject to appeal.

The board must provide a copy of the decision to all parties, the head of the state contracting agency, and the chief procurement officer.

EFFECTIVE DATE: June 1, 2010

§ 36 — CONTESTING STATE CONTRACT SOLICITATIONS OR AWARDS

The act establishes a process for bidders or proposers on state contracts to contest (1) the way the contracts were solicited or awarded or (2) an unauthorized or unwarranted, noncompetitive selection process. They may bring a claim to a SCSB subcommittee consisting of three members, including at least one legislative appointee, appointed by the chairperson. The claim must be in writing and submitted within 14 days after the claimant knew or should have known about the facts forming the basis for the claim. Claims must be limited to the solicitation or awarding procedures or of unauthorized or unwarranted, noncompetitive selection.

The act authorizes the subcommittee to resolve or settle the claim. If it is not resolved, the act requires the subcommittee to issue a written decision within 30 days after receiving the claim and provide a copy to the claimant. The decision must:

1. describe the procedure the agency used to solicit and award the contract,

2. indicate the agency's (apparently this means the subcommittee) findings on the claim's merits, and

3. inform the claimant of his right to review.

EFFECTIVE DATE: June 1, 2010

§§ 39 & 40 — ILLEGAL SOLICITATIONS AND AWARDS

Prior to an award, the SCSB must cancel or revise a solicitation or proposed award of a state contracting agency's contract that violates the law.

If the board makes the determination after the contract is awarded and the contract recipient did not act in bad faith, the contract may be (1) ratified and affirmed by the state contracting agency if the board determines doing so is in the best interests of the state or (2) terminated and the recipient compensated for the actual expenses reasonably incurred under the contract, plus a reasonable profit.

If the person awarded the contract acted in bad faith, the contract may (1) be declared null and void or (2) ratified and affirmed if doing so is in the best interests of the state, as determined by the SCSB. The determination must be in writing and without prejudice to the state's right to any appropriate damages.

EFFECTIVE DATE: June 1, 2010

§§ 19-47 — REGULATIONS ESTABLISHING PROCUREMENT POLICIES AND PROCEDURES

The act requires the SCSB to adopt regulations establishing state procurement policies and procedures. Generally, the deadline for adopting the regulations is June 1, 2010. For those concerning contracting procedures for constituent units of higher education, it is January 1, 2011.

Under the act, the SCSB must adopt regulations:

1. (a) defining competitive sealed bidding, competitive sealed proposals, small purchase procedure, sole source procurement, emergency procurements, and waiver of bid or proposal requirements for extraordinary conditions; (b) establishing the circumstances under which state contracting agencies use these methods; and (c) establishing the processes and criteria for awarding purchases and contracts in accordance with each method (§ 19);

2. specifying the procedure for issuing invitations for bids, including (a) the required elements, (b) the process for opening bids, and (c) evaluation criteria for awarding bids(§ 20);

3. specifying when contracts and purchase orders exceeding $50,000 do not have to go through the competitive sealed- bidding procedure (§ 20);

4. in consultation with DAS, establishing small purchase procedures for procurements of $50,000 or less (see Below) (§ 21);

5. in consultation with the DAS commissioner, specifying when a contract for a supply, service, or construction item does not have to go through a competitive bidding procedure (see Below) (§ 22);

6. establishing procedures for waiving competitive bidding or proposal requirements (§ 23);

7. in consultation with the DAS commissioner and any other appropriate awarding authority, permitting emergency procurements when a threat to the public's health, welfare, or safety exists (see Below) (§ 24);

8. in consultation with the DAS commissioner, establishing standards for preparing and maintaining the content of specifications for state supplies, services, and construction (§ 26);

9. in consultation with the attorney general, specifying the types of contracts that state contracting agencies may use when procuring consultant services (§ 27);

10. requiring proposed contractors, before the award of a contract, to submit documentation to the contracting agency confirming that their accounting system will permit timely processing of necessary cost data in the required format (§ 28);

11. specifying (a) the process for procuring (1) architectural and engineering services in design-bid-build procurements, (2) construction in design-bid-build procurements, and (3) construction management at-risk and (b) project delivery methods (§ 41);

12. requiring bid security for all competitive sealed bidding for construction contracts in design-bid-build procurement when the contracting agency estimates the price will exceed $500,000 (§ 42);

13. establishing the process for procuring consultant services (see Below)(§ 44);

14. in consultation with state contracting agencies and the attorney general, requiring state contracts with state contracting agencies concerning infrastructure facilities to include clauses for (a) price adjustments, (b) time performance, (c) remedies, (d) termination, or (e) other contract provisions necessary to protect the state's interests (§ 45);

15. concerning the procedures and circumstances under which state construction contracts of more than $ 50,000 may undergo (1) contract modifications, (2) change orders, or (3) contract price adjustments (see Below (§ 46) ); and

16. applying the act's procurement procedures to each constituent unit of higher education, taking into consideration circumstances and factors unique to them (§ 47).

In addition, the State Insurance and Risk Management Board must adopt regulations, in consultation with the SCSB, specifying when a state contracting agency must require proposers to provide errors and omissions insurance to cover architectural and engineering services under the project delivery methods described above. Under the act, a “proposer” is a person, firm, or corporation that submits a bid in response to an RFP or other sealed proposal (§ 43).

Small Purchase Procedures

The regulations establishing small purchase procedures for procurements of $50,000 or less must prohibit dividing a procurement to make use of the procedures. The act specifies that the SCSB, in consultation with the DAS commissioner, determines if a contracting agency has artificially divided a procurement. Upon making such a determination, the SCSB must prohibit the state contracting agency from utilizing the small purchase procedures.

In addition, the act authorizes the SCSB, in consultation with the DAS commissioner, to waive the competitive bidding or negotiation requirements in the case of minor, nonrecurring, or emergency purchases of $ 10,000 or less.

Contracts for Supply, Service or Construction Items

The regulations must cover situations when an agency contracting officer states, in writing, that there is only one source for the required item. They must specify that a sole source procurement is permitted when an item is available only from a single supplier.

Emergency Procurements

The act specifies that emergency procurements go through a competitive bidding process when practicable under the circumstances. The regulations must require the contract file to include a written determination of the basis for the emergency and for the contractor selection. The information must be transmitted to the Governor and the top six legislative leaders.

Types of Contracts

The regulations must specify that a cost-reimbursement contract may be used only when the agency procurement officer makes a written determination that (1) such a contract is likely to cost less than any other type or (2) that it is impracticable to obtain the supplies, services, or construction required, except under such a contract.

Modifications, Change Orders, and Price Adjustments

Under the act, the regulations must require prior written certification for every contract modification, change order, or contract price adjustment for a state construction contract over $50,000. The written certification may be signed by (1) the fiscal officer of the contracting state agency or the agency responsible for funding the project or (2) an official responsible for monitoring and reporting on the status of the total project or contract budget.

If the changes will increase the total project or contract budget, the agency procurement officer cannot execute the modification, change order, or adjustment unless sufficient funds are available or the scope of the project or contract is adjusted to permit the degree of completion that is feasible within the total project or contract budget as it existed before the contract change under consideration. However, “with respect to the validity as to the contractor, of any executed contract modification, change order, or adjustment in contract price which the contractor has reasonably relied upon, it shall be presumed that there has been compliance with the provisions of this section. ” It is unclear what this language means.

“Change orders” are written orders signed by an official designated by the department head directing the contractor to make authorized changes.

EFFECTIVE DATE: January 1, 2009, except the provision (1) requiring the SCSB to define the terms (§ 18) is effective June 1, 2010 and (2) establishing the circumstances under which state contracting agencies may use those procurement methods (§19) is effective October 1, 2009.

OLR Tracking: SNE: KM: SS: ts