Bill Text: MI SB0702 | 2013-2014 | 97th Legislature | Introduced

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Bill Title: State financing and management; purchasing; use of bid scorecards system for certain procurement contracts awarded; require. Amends secs. 261 & 268 of 1984 PA 431 (MCL 18.1261 & 18.1268).

Spectrum: Partisan Bill (Republican 8-0)

Status: (Introduced - Dead) 2013-12-03 - Referred To Committee On Appropriations [SB0702 Detail]

Download: Michigan-2013-SB0702-Introduced.html

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SENATE BILL No. 702

 

 

December 3, 2013, Introduced by Senators COLBECK, NOFS, PROOS, GREEN, CASWELL, BRANDENBURG, MARLEAU and BOOHER and referred to the Committee on Appropriations.

 

 

 

     A bill to amend 1984 PA 431, entitled

 

"The management and budget act,"

 

by amending sections 261 and 268 (MCL 18.1261 and 18.1268), section

 

261 as amended by 2012 PA 555 and section 268 as amended by 2007 PA

 

183.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     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, in all purchases made by the department, all

 

other things being equal, preference shall be given to products

 

manufactured or services offered by Michigan-based firms or by

 

facilities with respect to which the operator 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

 

324.1427. 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

 

acquisition.

 

     (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

 

10.89.

 

     (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

 

law.

 

     (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

 

subsection.

 

     (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) As used in this section:

 

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

 

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

 

disability.

 

     (b) "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).

 

     (c) "Veteran" means a person who served in the army, air

 

force, navy, marine corps, or coast guard and who was discharged or

 

released from his or her service with an honorable or general

 

discharge.

 

     (8) Beginning October 1, 2014, the department and all state

 

agencies that have had procurement authority delegated to them by

 

the department shall award contracts they award under this section

 

with an expected contract award of $100,000.00 or more by using a

 

bid scorecard system that tallies contract bids based on technical

 

and critical performance requirements, cost evaluation, and labor

 

evaluation. The bid scorecard system shall provide for all of the

 

following:

 

     (a) The technical and critical performance standards shall be

 

numerical and verifiable and shall count for 10% of the points on

 

the bid scorecard.

 

     (b) The cost evaluation shall be based on the bid price and

 

shall count for 70% of the points on the bid scorecard.

 

     (c) The labor evaluation shall count for 20% of the points on

 

the bid scorecard, with up to 1/2 of those points awarded for

 

employees who are veterans or qualified disabled veterans and up to

 

1/2 of those points awarded for employees who are residents of this

 

state.

 

     (d) The scope of the labor evaluation shall include prime

 

contracting agents and any other business that will fulfill

 

contract delivery requirements as a subcontractor to a prime

 

contractor.

 

     (9) The bid scorecard system described in subsection (8) shall

 

also provide that if any change is made to the evaluation criteria

 

in a request for proposal, then the department or the state agency

 

that had procurement authority delegated to it shall simultaneously

 

communicate those changes to all bidders on that contract and shall

 

also simultaneously communicate any responses to an inquiry from an

 

individual bidder to all bidders on that contract.

 

     (10) As long as the bidder meets the minimum bid requirements

 

as determined by the department, the department shall award the

 

contract to the bidder with the highest point tally described in

 

subsection (8) as determined by the department.

 

     (11) The department shall develop automation tools to assist

 

in the application of the bid scorecard system described in

 

subsection (8) and shall make the bid scorecard system available to

 

the public on the department's internet website.

 

     Sec. 268. (1) A bidder for a state contract is a Michigan

 

business for the purposes of this section if it certifies that it

 

has done any of the following during the 12 months immediately

 

preceding the bid deadline or for the period the business has been

 

in existence, if the business is newly established within the 12

 

months immediately preceding the bid deadline:

 

     (a) Filed a Michigan single business tax return or Michigan

 

business tax return showing a portion or all of the income tax base

 

allocated or apportioned to the state of Michigan pursuant to the

 

former single business tax act, 1975 PA 228, or the Michigan

 

business tax act, 2007 PA 36, MCL 208.1101 to 208.1601, or the

 

income tax act of 1967, 1967 PA 281, MCL 206.1 to 206.713.

 

     (b) Filed a Michigan income tax return showing income

 

generated in or attributed to the state of Michigan.

 

     (c) Withheld Michigan income tax from compensation paid to the

 

bidder's owners and remitted the tax to the department of treasury.

 

     (2) The filing or withholding shall be more than a nominal

 

filing for the purpose of gaining the status of a Michigan

 

business, but shall indicate a significant business presence in the

 

state, considering the size of the business and the nature of its

 

activities.

 

     (3) A bidder certifying that it meets the criteria for a

 

Michigan business listed in subsections (1), and (2), and (12)

 

shall authorize the department of treasury to verify that the

 

bidder has or has not met 1 of the 3 criteria in subsection (1).

 

This authorization shall permit the department of treasury to

 

disclose the verifying information to the procuring agency in

 

accordance with the procedures established by section 28 of 1941 PA

 

122, MCL 205.28.

 

     (4) Only a bidder that has certified that it is a Michigan

 

business is entitled to have the department apply a reciprocal

 

preference in its favor against a business that submits a bid from

 

a state which applies a preference law against out-of-state

 

bidders. A bidder that does not certify that it is a Michigan

 

business shall indicate in its bid the state in which it maintains

 

its principal place of business for the purpose of applying that

 

state's preference law against the bidder.

 

     (5) If the low bid for a state procurement exceeds $100,000.00

 

and is from a business located in a state which applies a

 

preference law against out-of-state businesses, the department

 

shall prefer a bid from a Michigan business in the same manner in

 

which the out-of-state bidder would be preferred in its home state.

 

     (6) The department shall compile a list of states that give

 

preference to in-state bidders and the extent of the preference and

 

shall update the list at least annually. An agency may rely on this

 

compilation in implementing the provisions of this act without

 

incurring liability to any bidder.

 

     (7) A bidder waives any entitlement to claim a preference

 

under this act if the bidder has not certified in its bid that the

 

bidder is a Michigan business and has not authorized the department

 

of treasury to release information necessary to verify the

 

entitlement.

 

     (8) A bidder shall not fraudulently certify that it is a

 

Michigan business under this act or falsely indicate the state in

 

which it has its principal place of business for the purpose of

 

avoiding application of the reciprocal preference.

 

     (9) A business that purposefully or willfully submits a false

 

certification that it is a Michigan business or falsely indicates

 

the state in which it has its principal place of business is guilty

 

of a felony, punishable by a fine of not less than $25,000.00.any

 

other false information in support of a bid is responsible for a

 

civil violation, and the department shall impose a civil fine

 

against that entity in an amount equal to 10% of the contract value

 

in which the false certification or false information was made.

 

     (10) Two years after October 1, 1988, the department shall

 

review the costs and consequences of implementing this section. The

 

department shall solicit input from the business community and from

 

state agencies receiving procurements affected by the provisions of

 

this section, and shall make recommendations to the legislature

 

regarding continuation or modification of this section.

 

     (11) This section shall not apply to any procurement if the

 

provisions of this section would conflict with federal statute.

 

     (12) Beginning October 1, 2014, before a bidder is eligible to

 

be certified a Michigan business and before a bidder is eligible to

 

bid for a state contract, the bidder shall disclose to the

 

department all of the following:

 

     (a) The number and percentage of its employees who work more

 

than 20 hours per week and who have been employed by that business

 

for the immediate and preceding 90-day period who are residents of

 

this state.

 

     (b) The percentage of its employees who work more than 20

 

hours per week and who have been employed by that business for the

 

immediate and preceding 90-day period who are veterans.

 

     (c) The percentage of its employees who work more than 20

 

hours per week and who have been employed by that business for the

 

immediate and preceding 90-day period who are qualified disabled

 

veterans.

 

     (13) Beginning October 1, 2014, the department shall maintain

 

a list of all Michigan businesses certified under this section on

 

the department's internet website.

 

     (14) As used in this section:

 

     (a) "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).

 

     (b) "Veteran" means a person who served in the army, air

 

force, navy, marine corps, or coast guard and who was discharged or

 

released from his or her service with an honorable or general

 

discharge.