Bill Text: HI SB2291 | 2010 | Regular Session | Amended
Bill Title: State Procurement Office; Reseller Agreements
Spectrum: Moderate Partisan Bill (Democrat 5-1)
Status: (Engrossed - Dead) 2010-03-19 - (H) Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with none voting no (0) and Representative(s) Carroll, Chang, Har, Manahan, Morita, M. Oshiro, Tokioka, Ward excused (8). [SB2291 Detail]
Download: Hawaii-2010-SB2291-Amended.html
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THE SENATE |
S.B. NO. |
2291 |
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TWENTY-FIFTH LEGISLATURE, 2010 |
S.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO ECONOMIC DEVELOPMENT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
PART I
SECTION 1. Following the 2009 legislative session, the chairs of the senate committee on economic development and technology and the house committee on economic revitalization, business and military affairs convened a technology caucus work group to bring together industry stakeholders and interested policymakers to develop recommendations for legislation to enhance Hawaii's struggling economy. The work group provided a forum to review the current status of Hawaii's science/technology industry, identify state or county actions that impede long-term growth and expansion of technology companies, and develop recommendations to address these impediments. The work group also identified best practices supporting the growth and development of science/technology industries in other jurisdictions to aid in developing proposed suggestions for future legislation.
PART II
SECTION 2. The legislature finds that state government procurement procedures impede the ability of local high technology businesses to compete in areas in which they can provide the best services for the best price. One means of achieving greater parity for high technology businesses in Hawaii is the implementation of a Hawaii business preference, or set-aside, to achieve comparable opportunities as federal procurement set-asides for small business.
The purpose of this part is to implement recommendations of the technology caucus work group by establishing a state procurement preference for the benefit of Hawaii businesses providing high technology goods or services.
SECTION 3. Section 103D-1001, Hawaii Revised Statutes, is amended as follows:
1. By adding a new definition to be appropriately inserted and to read:
""High technology" means industries that are technology-intensive, including but not limited to electronics, biotechnology, software, computers, telecommunications, and other computer-related technologies."
2. By amending the definition of "Hawaii software development business" to read:
""Hawaii [software development]
business" means [any]
(1) Any person, agency, corporation, or
other business entity with its principal place of business or ancillary
headquarters located in the State and that proposes to obtain eighty per cent
of the labor [for software development] from persons domiciled in Hawaii[.];
or
(2) A small business qualified for federal procurements under the Small Business Administration HUBzone Empowerment Contracting program."
SECTION 4. Section 103D-1006, Hawaii Revised Statutes, is amended to read as follows:
"§103D-1006 [Software development
businesses.] High technology goods or services. (a) In any
expenditure of public funds for [software development,] high
technology goods or services that may be provided by a Hawaii business, the
use of Hawaii [software development] businesses shall be preferred.
Where a package bid or response to a request for proposal for high
technology goods or services contains both Hawaii and non‑Hawaii [software
development] businesses, then for the purpose of selecting the lowest bid
or purchase price only, the bid or offer by a non-Hawaii [software
development] business shall be increased by a preference percentage [pursuant
to rules adopted by the policy board.] of five per cent.
(b) Intellectual property specifically developed and designed by any Hawaii business for high technology goods or services that is purchased by the State may require an unlimited use license to assure maximum benefit to state agencies and the high technology goods or services vendors.
[(b)] (c) This section shall not
apply when precluded by federal requirements for competitive bidding."
SECTION 5. The state procurement office shall submit a report to the legislature on the implementation of this part no later than twenty days prior to the convening of the regular session of 2012. The report shall include:
(1) A description of the ways in which the state procurement office promoted the use of the high technology goods and services Hawaii business preference;
(2) Statistics on the use of the preference and its economic impact;
(3) Any other information available to the state procurement office that would be useful in evaluating and improving the preference;
(4) A copy of any rules adopted; and
(5) Any recommendations concerning the preference.
PART III
SECTION 6. The legislature finds that the Western States Contracting Alliance (WSCA) was formed in October 1993 by the state purchasing directors from fifteen western states. The primary purpose of creating WSCA was to establish the means by which participating states may join together in cooperative multi-state contracting to achieve cost-effective and efficient acquisition of quality products and services. WSCA uses a cooperative, competitive model to capture the best pricing possible for the volume of purchases being made. However, once a brand determination has been made, and WSCA has been chosen as the contracting vehicle, there is no incentive for the chosen manufacturer to offer any additional discounts below the pre-negotiated WSCA price.
The legislature further finds that WSCA does allow for the extension of this competitive environment at the individual order level by allowing each contract holder to designate multiple resellers (servicing subcontractors) to quote and sell products under their respective WSCA contract within any particular participating state. The use of reseller agents expands the discounting possibilities by pitting two or more resellers against each other in a competitive environment; in most cases ensuring additional discounts are offered by the resellers to secure the task order award. Additionally, as these selected reseller agents are usually local firms, WSCA customers receive better service than if working directly with a manufacturer that has little or no local presence. The majority of states with WSCA agreements use reseller agents.
In the past, Hawaii placed orders for goods and services directly with local reseller agents for goods and services procured under WSCA multistate agreements; however, since 2009, the state procurement office has changed its practices and now requires purchase orders for goods and services to be placed directly with original equipment manufacturers. By doing so, the State has eliminated an efficient, cost-effective means of obtaining local support for goods and services procured under WSCA agreements and replaced it with a procedure that costs the same, but does not include the level of servicing support that occurred previously.
The purpose of this part is to implement recommendations of the technology caucus work group by requiring the state procurement office to authorize reseller agreements in multi‑state contracting agreements.
SECTION 7. Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§103D- Reseller agreements. The state procurement office shall authorize local reseller agreements as part of any multi-state contracting agreement, and shall place orders directly with local resellers designated by original equipment manufacturers."
PART IV
SECTION 8. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.
SECTION 9. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 10. This Act shall take effect upon its approval.
Report Title:
State Procurement Office; High Technology Goods or Services; Hawaii Business Procurement Preference; Reseller Agreements
Description:
Expands the procurement preference for high technology goods or services provided by Hawaii businesses; specifies a five per cent preference; requires the state procurement office to report to the 2012 legislature on implementation of the preference; requires the state procurement office to authorize reseller agreements in multi-state contracting agreements. (SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
