Bill Text: MI SB0363 | 2017-2018 | 99th Legislature | Engrossed

Bill Title: State financing and management; purchasing; state contracts; provide preference to certain Michigan-based firms. Amends sec. 261 of 1984 PA 431 (MCL 18.1261).

Spectrum: Partisan Bill (Republican 1-0)

Status: (Engrossed - Dead) 2017-05-24 - Referred To Committee On Commerce And Trade [SB0363 Detail]

Download: Michigan-2017-SB0363-Engrossed.html

SB-0363, As Passed Senate, May 24, 2017
















May 4, 2017, Introduced by Senators JONES, YOUNG, KOWALL, ANANICH, HERTEL, NOFS, CASPERSON, SCHUITMAKER, BRANDENBURG, O'BRIEN, KNEZEK, BIEDA, HORN, HUNE, SCHMIDT and ROBERTSON and referred to the Committee on Michigan Competitiveness.



     A bill to amend 1984 PA 431, entitled


"The management and budget act,"


by amending section 261 (MCL 18.1261), as amended by 2017 PA 21.




     Sec. 261. (1) The department shall provide for the purchase


of, the contracting for, and the providing of supplies, materials,


services, insurance, utilities, third party financing, equipment,


printing, and all other items as needed by state agencies for which


the legislature has not otherwise expressly provided. If consistent


with federal statutes, law, in all purchases made by the


department, all other things being equal, except as otherwise


provided in this subsection preference shall be given to products


manufactured or services offered by Michigan-based firms or by

facilities with respect to which the operator of a facility that is


designated as a clean corporate citizen under part 14 of the


natural resources and environmental protection act, 1994 PA 451,


MCL 324.1401 to 324.1429, or to biobased products whose content is


sourced in this state. If consistent with federal law, a preference


of 8% of the amount of the contract shall be granted to Michigan-


based firms for products mined in this state against a bidder that


is not a Michigan-based firm and is located outside of the United


States. The department shall solicit competitive bids from the


private sector whenever practicable to efficiently and effectively


meet the state's needs. The department shall first determine that


competitive solicitation of bids in the private sector is not


appropriate before using any other procurement method for an




     (2) The department shall make all discretionary decisions


concerning the solicitation, award, amendment, cancellation, and


appeal of state contracts.


     (3) The department shall utilize competitive solicitation for


all purchases authorized under this act unless 1 or more of the


following apply:


     (a) Procurement of goods or services is necessary for the


imminent protection of public health or safety or to mitigate an


imminent threat to public health or safety, as determined by the


director or his or her designated representative.


     (b) Procurement of goods or services is for emergency repair


or construction caused by unforeseen circumstances when the repair


or construction is necessary to protect life or property.

     (c) Procurement of goods or services is in response to a


declared state of emergency or state of disaster under the


emergency management act, 1976 PA 390, MCL 30.401 to 30.421.


     (d) Procurement of goods or services is in response to a


declared state of emergency under 1945 PA 302, MCL 10.31 to 10.33.


     (e) Procurement of goods or services is in response to a


declared state of energy emergency under 1982 PA 191, MCL 10.81 to




     (f) Procurement of goods or services is within a state


agency's purchasing authority delegated under subsection (4), and


the state agency has established policies or procedures approved by


the department to ensure that goods or services are purchased by


the state agency at fair and reasonable prices.


     (4) The department may delegate its procurement authority to


other state agencies within dollar limitations and for designated


types of procurements. The department may withdraw delegated


authority upon a finding that a state agency did not comply with


departmental procurement directives.


     (5) The department may enter into lease purchases or


installment purchases for periods not exceeding the anticipated


useful life of the items purchased unless otherwise prohibited by




     (6) The department shall issue directives for the procurement,


receipt, inspection, and storage of supplies, materials, and


equipment, and for printing and services needed by state agencies.


The department shall provide standard specifications and standards


of performance applicable to purchases.

     (7) The department may enter into a cooperative purchasing


agreement with 1 or more other states or public entities for the


purchase of goods, including, but not limited to, recycled goods,


and services necessary for state programs.


     (8) In awarding a contract under this section, the department


shall give a preference of up to 10% of the amount of the contract


to a qualified disabled veteran. If the qualified disabled veteran


otherwise meets the requirements of the contract solicitation and


with the preference is the lowest bidder, the department shall


enter into a procurement contract with the qualified disabled


veteran under this act. If 2 or more qualified disabled veterans


are the lowest bidders on a contract, all other things being equal,


the qualified disabled veteran with the lowest bid shall be awarded


the contract under this act.


     (9) It is the goal of the department to award each year not


less than 5% of its total expenditures for construction, goods, and


services to qualified disabled veterans. The department may count


toward its 5% yearly goal described in this subsection that portion


of all procurement contracts in which the business entity that


received the procurement contract subcontracts with a qualified


disabled veteran. Each year, the department shall report to each


house of the legislature on all of the following for the


immediately preceding 12-month period:


     (a) The number of qualified disabled veterans who submitted a


bid for a state procurement contract.


     (b) The number of qualified disabled veterans who entered into


procurement contracts with this state and the total value of those

procurement contracts.


     (c) Whether the department achieved the goal described in this




     (d) The recommendations described in subsection (10).


     (10) Each year, the department shall review the progress of


all state agencies in meeting the 5% goal with input from statewide


veterans service organizations and from the business community,


including businesses owned by qualified disabled veterans, and


shall make recommendations to each house of the legislature


regarding continuation, increases, or decreases in the percentage


goal. The recommendations shall be based upon the number of


businesses that are owned by qualified disabled veterans and on the


continued need to encourage and promote businesses owned by


qualified disabled veterans.


     (11) To assist the department in reaching the goal described


in subsection (9), the governor shall recommend to the legislature


changes in programs to assist businesses owned by qualified


disabled veterans.


     (12) Beginning October 1, 2017, the department and all state


agencies may not enter into a contract with a person to acquire or


dispose of supplies, services, or information technology unless the


contract includes a representation that the person is not currently


engaged in, and an agreement that the person will not engage in,


the boycott of a person based in or doing business with a strategic




     (13) The following records are exempt from disclosure under


the freedom of information act, 1976 PA 442, MCL 15.231 to 15.246,

as provided in this subsection:


     (a) A bid, quote, or proposal submitted in connection with the


authority granted under this section, and records created in the


preparation for and evaluation of the bid, quote, or proposal until


the time of final notification of award of the contract.


     (b) Records containing a trade secret as defined under section


2 of the uniform trade secrets act, 1998 PA 448, MCL 445.1902, or


financial or proprietary information submitted in connection with


the authority granted under this section.


     (14) As used in this section:


     (a) "Biobased product" means a product granted the United


States Department of Agriculture certified biobased product label.


     (b) "Boycott" means refusal to have dealings with, divest


from, or otherwise engage with a person. Boycott does not include 1


or more of the following:


     (i) A decision based on bona fide business or economic




     (ii) A boycott against a public entity of a foreign state when


the boycott is applied in a nondiscriminatory manner.


     (iii) Conduct necessary to comply with applicable law in the


person's home jurisdiction.


     (c) "Financial or proprietary information" means information


that has not been publicly disseminated or which is unavailable


from other sources, the release of which might cause the submitter


of the information competitive harm.


     (d) "Person" means any of the following:


     (i) An individual, corporation, company, limited liability

company, business association, partnership, society, trust, or any


other nongovernmental entity, organization, or group.


     (ii) Any governmental entity or agency of a government.


     (iii) Any successor, subunit, parent company, or subsidiary


of, or company under common ownership or control with, any entity


described in subparagraph (i) or (ii).


     (e) "Qualified disabled veteran" means a business entity that


is 51% or more owned by 1 or more veterans with a service-connected




     (f) "Service-connected disability" means a disability incurred


or aggravated in the line of duty in the active military, naval, or


air service as described in 38 USC 101(16).


     (g) "Strategic partner" means a strategic partner described in


22 USC 8601 to 8606.


     (h) "Veteran" means an individual who meets both of the




     (i) Is a veteran as defined in section 1 of 1965 PA 190, MCL




     (ii) Was released from his or her service with an honorable or


general discharge.