HB 6194 — AN ACT CONCERNING THE COMPETITIVE BIDDING AND OVERSIGHT OF QUASI-PUBLIC AGENCY CONTRACTS.

(16) To invest in, acquire, lease, purchase, own, manage, hold and dispose of real property and lease, convey or deal in or enter into agreements with respect to such property on any terms necessary or incidental to carrying out the purposes of sections 12-563a and 12-800 to 12-818, inclusive, provided such transactions shall not be subject to approval, review or regulation pursuant to title 4b or any other statute by any state agency, except that real property transactions shall be subject to review by the State Properties Review Board and contracts sHB6194shall /be Filesubject No.to the requirements of section 1 of this act and the applicable provisions of chapter 62;

498 9 sHB6194 File No.

498 shall be subject to the requirements of section 1 of this act and the applicable provisions of chapter 62;

Section 12-815 of the general statutes is repealed and the followingLCO is{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06199 substitutedof in17 lieuR03-HB.docx thereof} (EffectiveSubstitute OctoberBill 1,No. 2021):

6194 following is substituted in lieu thereof (Effective October 1, 2021):

Nothing in this section shall be deemed to restrict the discretion of the corporation to utilize its own staff and workforce for the performance of any of its assigned responsibilities and functions whenever, in the discretion of the sHB6194corporation, /it Filebecomes No.necessary, convenient or desirable to do so.

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498 corporation, it becomes necessary, convenient or desirable to do so.

(b)LCO The{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06110 corporation shall not be subject to rules, regulations or restrictions on purchasing or procurement or the disposition of assets17 generallyR03-HB.docx applicable} toSubstitute ConnecticutBill stateNo. agencies, including those contained in titles 4a and 4b and the corresponding rules and regulations, but shall be subject to the requirements of section 1 of this act and the applicable provisions concerning quasi-public agencies in chapter 62.

6194 (b) The corporation shall not be subject to rules, regulations or restrictions on purchasing or procurement or the disposition of assets generally applicable to Connecticut state agencies, including those contained in titles 4a and 4b and the corresponding rules and regulations, but shall be subject to the requirements of section 1 of this act and the applicable provisions concerning quasi-public agencies in chapter 62.

sHB6194(16) /Contract Filefor No.services in the performance of architectural and engineering design, the supervision of design and construction, system management and facility management;

498for 11such sHB6194professional Fileor LCO {\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06111 of 17 R03-HB.docx } Substitute Bill No.

4986194 (16)technical Contract for services inas theare performancespecified ofin architecturalsubdivision and(3) engineering design, the supervision of designsection and22a-265; construction, system management and facility management;

for such professional or technical services as are specified in subdivision (3) of section 22a-265;

The authority shall conduct its contracting and purchasing operations in accordance with section 1 of this act and its regularly adopted and promulgated procurement policies, including the contracting procedures adopted sHB6194under /section File22a-268a, No.as amended by this act, and specific rules and procedures on purchasing and contracting approved by a two-thirds vote of its full board of directors.

498In 12procuring sHB6194services Filewith respect to LCO {\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06112 of 17 R03-HB.docx } Substitute Bill No.

4986194 underthe sectionestablishment, 22a-268a,management asand amendedoperation byof thistransfer act,stations, and specificthe rulestransportation andof proceduressolid onwastes purchasingtherefrom andto contractinga approvedsolid bywaste afacility, two-thirdsthe voteauthority ofand its fullsubcontractors boardshall ofinsofar directors.as is practicable give preference to firms based in Connecticut.

In procuring services with respect to the establishment, management and operation of transfer stations, and the transportation of solid wastes therefrom to a solid waste facility, the authority and its subcontractors shall insofar as is practicable give preference to firms based in Connecticut.

The authority is hereby empowered to enter into long- term contracts with private persons for the performance of any such functions of the authority which, in the opinion of the authority, can desirably and conveniently be carried out by a private person under sHB6194contract /provided Fileany such contract shall contain such terms and conditions as will enable the authority to retain overall supervision and LCO {\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06113 of 17 R03-HB.docx } Substitute Bill No.

4986194 13control sHB6194of Filethe No.business, design, operating, management, transportation, marketing, planning and research and development functions to be carried out or to be performed by such private persons pursuant to such contract.

498 contract provided any such contract shall contain such terms and conditions as will enable the authority to retain overall supervision and control of the business, design, operating, management, transportation, marketing, planning and research and development functions to be carried out or to be performed by such private persons pursuant to such contract.

Any litigation with respect to any terms, conditions or provisions of any contractoftheauthority,ortheperformanceornonperformanceofsame by either party, shall be tried before a judge of the Superior Court of sHB6194Connecticut. / File No.

498LCO 14{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06114 sHB6194of File17 R03-HB.docx } Substitute Bill No.

4986194 Connecticut.Sec.

Sec.

Subdivision (14) of subsection (b) of section 31-49h of the general statutes is repealed and the following is substituted in lieu sHB6194thereof /(Effective FileOctober No.1, 2021):

498LCO 15{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06115 sHB6194of File17 R03-HB.docx } Substitute Bill No.

4986194 thereof(14) (EffectiveMake Octoberand 1,enter 2021):into any contract or agreement necessary or incidental to the performance of its duties and execution of its powers subject to the provisions of section 1 of this act.

(14) Make and enter into any contract or agreement necessary or incidental to the performance of its duties and execution of its powers subject to the provisions of section 1 of this act.

The contracts entered into by the exchange shall not be subject to the sHB6194approval /of Fileany other state department, office or agency other than the LCO {\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06116 of 17 R03-HB.docx } Substitute Bill No.

4986194 16State sHB6194Contracting FileStandards No.Board under the applicable provisions of chapter 62, provided copies of all contracts of the exchange shall be maintained by the exchange as public records, subject to the proprietary rights of any party to the contract;

498 approval of any other state department, office or agency other than the State Contracting Standards Board under the applicable provisions of chapter 62, provided copies of all contracts of the exchange shall be maintained by the exchange as public records, subject to the proprietary rights of any party to the contract;

7 October 1, 2021 10a-204b(s) October 1, 2021 Sec.

8 October 1, 2021 10a-243 Sec.

17 October 1, 2021 38a-1083(c)(13) StatementGAE ofJoint LegislativeFavorable Commissioners:Subst.

In-LCO SectionAPP 1(b),Joint aFavorable referenceLCO to{\\PRDFS1\HCOUSERS\BARRYJN\WS\2021HB-06194- Subsec.17 of 17 R03-HB.docx }

"(d)" was changed to "(c)" for accuracy.

GAE Joint Favorable Subst.

-LCO sHB6194 / File No.

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498 The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose.

In general, fiscal impacts are based upon a variety of informational sources, including the analyst’s professional knowledge.

Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note State Impact:

Agency Affected Fund-Effect FY 22 $ FY 23 $ Governmental Accountability, GF - Cost 130,000 133,900 Off.

State Comptroller - Fringe GF - Cost 53,700 55,300 Benefits1 Note:

GF=General Fund Municipal Impact:

None Explanation The bill subjects quasi-public agencies to certain oversight by the StateContractingStandardsBoard(SCSB).Generally,itappliestoquasi- public agencies provisions in existing law that allow SCSB to limit state contracting agencies’ authority to enter into contracts or procurement agreements.

The SCSB would need to fill its unfunded vacant Chief Procurement Officer position to handle the bill's requirements.

The salary for this position is approximately $130,000.

Please note that the SCSB is located within the Office of Governmental Accountability.

The Out Years The annualized ongoing fiscal impact identified above would continue into the future subject to inflation.

The fringe benefit costs for most state employees are budgeted centrally in accounts administered by the Comptroller.

The estimated active employee fringe benefit cost associated with most personnel changes is 41.3% of payroll in FY 22 and FY 23.

sHB6194 / File No.

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498 OLR Bill Analysis HB 6194 AN ACT CONCERNING THE COMPETITIVE BIDDING AND OVERSIGHT OF QUASI-PUBLIC AGENCY CONTRACTS.

SUMMARY This bill generally requires quasi-public agencies to follow the same procedures as state agencies when entering into certain goods and services contracts.

(By law, the state has 17 quasi-public agencies.) Generally, these procedures require (1) using competitive bidding or competitive negotiation when purchasing goods and services and (2) awarding contracts to the lowest responsible qualified bidder or highest-scoring bidder in a multiple-criteria bid.

The bill’s provisions generally mirror provisions in existing law that apply to executive branch state agencies (CGS §§ 4a-50, -57 & -59).

The bill also subjects quasi-public agencies to certain oversight by the StateContractingStandardsBoard (SCSB).Generally,itappliestoquasi- public agencies provisions in existing law that allow SCSB to limit state contracting agencies’ authority to enter into contracts or procurement agreements.

It also requires quasi-public agencies to purchase goods and services using procurement methods specified in regulations that existing lawrequiresSCSBto adopt.(To date, theboardhasnot adopted these regulations.) The bill makes numerous conforming changes to individual quasi- public agencies’ authorizing statutes where they would otherwise conflict with the bill’s requirements (§§ 4-17).

EFFECTIVE DATE:

October 1, 2021 § 1 — COMPETITIVE BIDDING REQUIREMENTS Procedures sHB6194 / File No.

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498 The bill’s requirements apply to quasi-public agencies’ purchases of supplies, materials, equipment, and specified contractual services (e.g., laundry and cleaning, equipment maintenance).

With certain exceptions, it requires that purchases of these goods and services be made using competitive bidding or competitive negotiation (as defined in existing law) when possible.

When using competitive negotiation,the quasi-public agency must include price as an explicit criterion in the request for proposals and contract award.

The bill requires quasi-public agencies to adopt procedures establishing standards and procedures for (1) using competitive negotiation, including criteria to be considered and each criterion’s weight, and (2) making additional purchases from existing contracts.

As under existing law, the bill establishes exceptions for (1) minor nonrecurring and emergency purchases of $10,000 or less and (2) specified public utility services.

Solicitations Under the bill, quasi-public agencies must solicit competitive bids or proposals by noticing the planned purchase in a form and manner they determine willpromote competitionandmaximizepublicparticipation, including by small contractors certified under the state set-aside program (see BACKGROUND).

The notice must include the types of goods and services sought by the agency and the contract award’s estimated value.

When applicable, the notice must also contain (1) a notice of state law’s nondiscrimination and affirmative action requirements and (2) provisionsforawardingcontractstoentitiescertifiedunderthestateset- aside program (e.g., small contractors and minority business enterprises).

The bill requires quasi-public agencies to keep bids and proposals sealed or secured until publicly opened at the time stated in the solicitation notice.

sHB6194 / File No.

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498 Contract Awards The bill requires that all open-market orders or contracts for the specified goods and services be awarded to the (1) lowest responsible qualified bidder, (2) highest-scoring bidder in a multiple-criteria bid, or (3) proposer that the quasi-public agency deems as having the most advantageous proposal.

“Lowest responsible qualifiedbidder” refersto thelowest bidder that has the skill, ability, and integrity needed to perform the work.

“Highest-scoring bidder in a multiple-criteria bid” refers to the bidder with the highest score for a combination of attributes, including price, skill, ability, and integrity based on objective criteria established in the bid solicitation.

In both cases, the quasi-public agency must base its evaluation on the bidder’s fulfillment of past contract obligations and experience or lack of experience in delivering the specific goods or services sought in the bid solicitation.

§§ 2 & 3 — SCSB OVERSIGHT Under current law, SCSB has limited authority over quasi-public agencies, as they are not included in the definition of “state contracting agency” in SCSB’s authorizing statutes (however, the State Education Resource Center (SERC) is a state contracting agency under a statute governing procurement methods) (see BACKGROUND).

The bill applies to quasi-public agencies provisions in existing law that allow SCSB to limit state contracting agencies’ authority to enter into contracts or procurement agreements.

Specifically, it allows SCSB, under specified conditions, to (1) review, terminate, or recommend termination of a contract or procurement agreement for cause following specified procedures (e.g., provide the contractor with a hearing);

(2) restrict or terminate a quasi-public agency’s authority to enter into a contract or procurement agreement;

and (3) order a quasi-public agency to restrict or terminate an employee’s or agent’s authority to enter into contracts or procurement agreements.

The bill also applies to quasi-public agencies a requirement in sHB6194 / File No.

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498 existing law that all goods and services purchases by a state contracting agency be made by (1) competitive sealed bidding or proposals, (2) small purchase procedure, (3) sole source procurement, (4) emergency procurements, or (5) a bid or proposal waiver for extraordinary conditions (CGS § 4e-19).

Under current law, SERC is the only quasi- public agency subject to these requirements.

These provisions require SCSB to adopt implementing regulations beforetheybecomeoperative.However,SCSBhasnotadoptedanysuch implementing regulations to date.

Therefore, it is unclear how the statutes would apply to quasi-public agencies.

BACKGROUND Related Bills sHB 6664, reported favorably by the Government Administration and Elections (GAE) Committee, makes numerous changes that, generally, increase the executive and legislative branches’ oversight of quasi-public agencies.

sHB 6577, reported favorably by the GAE Committee, requires the State Properties Review Board to review and approve or disapprove certain real estate transactions proposed by quasi-public agencies.

Attorney General Opinion In a 2021 opinion (Attorney General Opinion 2021-01), the attorney generalconcludedthatmostSCSBstatutesgivetheboardauthorityover state contracting agencies only, with only limited authority over quasi- public agencies.

He noted that although the board has authority over certain bid contests involving quasi-public agencies, generally its authority over quasi-public agencies “is much more limited and circumscribed relative to its authority over state contracting agencies.” Set-Aside Program The state set-aside program requires state agencies and certain political subdivisions (including quasi-public agencies) to set aside 25% of the total value of all contracts they let for construction, goods, and sHB6194 / File No.

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498 services each year for exclusive bidding by certified small contractors.

The agencies must further reserve 25% of the set-aside value (6.25% of the total) for exclusive bidding by certified minority business enterprises (MBE).

By law, a “certified small contractor” is a business that (1) maintains its principal place of business in Connecticut, (2) had gross revenues of $20 million or less during its most recent fiscal year, and (3) is independent.

MBEs are small contractors owned by women, minorities, or people with disabilities.

The owner must have managerial and technical competence and experience directly related to his or her principal business activities (CGS § 4a-60g(a)).

COMMITTEE ACTION Government Administration and Elections Committee Joint Favorable Yea 19 Nay 0 (03/31/2021) sHB6194 / File No.

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