Revision: March 31, 2010, midnight
SB 495-FN – AS AMENDED BY THE SENATE
03/10/10 0879s
2010 SESSION
05/10
SENATE BILL 495-FN
AN ACT establishing a task force on state procurement policies and procedures.
SPONSORS: Sen. Cilley, Dist 6; Rep. Nord, Rock 1
COMMITTEE: Executive Departments and Administration
This bill establishes a task force on state procurement policies and procedures.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/10/10 0879s
10-2881
05/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Ten
AN ACT establishing a task force on state procurement policies and procedures.
1 Task Force Established. There is established a task force on state procurement policies and procedures, the purpose of which shall be to study procurement preference systems.
2 Members.
I. The task force shall consist of the following members:
(a) The commissioner of the department of administrative services, or designee.
(b) The commissioner of the department of resources and economic development, or designee.
(c) The attorney general, or designee.
(d) The commissioner of transportation, or designee.
(e) The commissioner of the department of labor, or designee.
(f) Three representatives of New Hampshire-based businesses, appointed by the governor, to include:
(1) One representative of the Associated General Contractors of New Hampshire.
(2) One representative of the New Hampshire/Vermont chapter of the Associated Builders and Contractors, Inc.
(g) Three representatives of organized labor, appointed by the governor, to include:
(1) One representative of the New Hampshire AFL-CIO.
(2) One representative of the State Employees’ Association of New Hampshire, Inc.
(3) One representative of the New Hampshire State Building and Construction Trades Council.
(h) One public member, appointed by the governor.
(i) Two members of the house of representatives, appointed by the speaker of the house of representatives.
(j) Two members of the senate, appointed by the senate president.
II. Members of the task force shall serve without compensation; except that legislative members of the task force shall receive mileage at the legislative rate when attending to the duties of the task force.
3 Duties and Recommendations.
I. The task force shall:
(a) Review all state procurement policies and procedures, seeking input from New Hampshire businesses and workers.
(b) Review procurement preference systems in other states.
(c) Consider whether the state's procurement procedures or policies present unnecessary barriers that prevent New Hampshire-based businesses, particularly small businesses, from competing for state contracts.
(d) Consider whether state procurement procedures should award preferences to New Hampshire-based businesses bidding on state contracts and assess any constitutional or legal limitations on such preferences.
(e) Consider whether state procurement procedures should award preferences to companies providing sustainable wages and health insurance to their workers.
(f) Solicit testimony from members of the public and others with information and expertise relevant to the task force’s study.
II. In making its recommendation, the task force shall consider:
(a) The potential for increased costs incurred by the state as the result of giving a preference to New Hampshire based companies or those offering sustainable wages and benefits.
(b) The potential for cost savings or other state benefits resulting from implementation of a procurement preference system.
(c) Whether such policies could have a negative impact on New Hampshire-based businesses competing for contracts in other states.
(d) Whether adoption of a procurement preference system should be limited to certain goods and services.
(e) The type of preference, if any, that may be offered to businesses that are based in New Hampshire or that provide sustainable wages and health insurance to their workers.
(f) Guidelines or criteria for determining what constitutes a New Hampshire-based business.
4 Chairperson; Quorum. The members of the task force shall elect a chairperson from among the members. The first meeting of the task force shall be called by the first-named senate member and shall be held within 45 days of the effective date of this section. Nine members of the task force shall constitute a quorum.
5 Report. The task force shall submit its findings and recommendations, including any recommendations for further legislation, to the senate president, the speaker of the house of representatives, the governor, and the state library on or before November 1, 2011.
6 Effective Date. This act shall take effect upon its passage.
LBAO
10-2881
01/06/10
SB 495-FN - FISCAL NOTE
AN ACT relative to state competitive bidding practices.
FISCAL IMPACT:
The Department of Administrative Services states this bill will increase state general fund expenditures by $920,668 in FY 2011, $913,222 in FY 2012, $960,274 in FY 2013, and $1,010,379 in FY 2014. There is no fiscal impact on state, county, and local revenue or county and local expenditures.
METHODOLOGY:
The Department of Administrative Services states this bill requires the Department’s division of Plant and Property Management to award contracts to the lowest responsible bidder. The Department states this bill has an impact on 3 of its bureaus: Purchase and Property, Public Works Design and Construction, and Graphic Services. The Department’s basic assumption is that this bill will increase the amount of time it takes to process requests for bids (RFB), requests for proposals (RFP), and requests for quotes (RFQ), hereafter referred to as ‘requests’. Currently, the Department estimates the eight employees of the Purchase and Property bureau, each assumed to work 230 days per year, process roughly 1,300 RFBs, RFPs, and RFQs each year, which translates to approximately 1.41 employee days to process each request ((8 employees × 230 working days) ÷ 1,300 documents). The Department estimates this bill’s requirements would add another day of processing time to each request, so the Purchase and Property bureau would need an additional six purchasing agents (labor grade 24) to comply with the proposed legislation ((1,300 documents × 1 additional day) ÷ 230 working days per year = 5.6 ≈ 6 additional employees).
The Department estimates its Graphic Services bureau, which has one full-time employee and processes an average of 169 requests annually, would also need an additional purchasing agent (labor grade 24) in order to meet the requirements of this bill.
The Department states it currently utilizes the Contract Administration section at the Department of Transportation to prequalify and award construction and renovation contracts. If the proposed bill were to become law, the Department states it would continue to use this DOT section to prequalify contractors, however it assumes the bill’s changes to contract award
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criteria would require creation of its own contracts unit within the Public Works Design and Construction bureau, as the Department of Transportation criteria would now be different from the Public Works Design and Construction criteria. The Department states the new unit would modify requests, evaluate responses to requests, and create the eventual final contracts. To establish the new unit, the Department estimates it would need to hire a business administrator III (labor grade 27) to oversee the unit, a purchasing agent (labor grade 24) to customize bids and create contract documents, and three project manager III positions (labor grade 27) to serve as part of a team reviewing and evaluating all responses received. In total for the three bureaus, the Department estimates it will need to hire 12 additional employees (8 purchasing agents at labor grade 24, 3 project managers at labor grade 27, 1 business administrator at labor grade 27). For each of these employees, the Department also estimates annually $1,200 for phone, postage, and supplies, $2,700 for leased office space, $3,100 for equipment, and $300 for in-state mileage reimbursement. The Department also assumed the business administrator and the eight purchasing agents would each need $1,300 for computer hardware and software in the first year and $250 for software renewals each year thereafter, and the three project managers would each need $2,400 for CADD hardware and software in the first year and $600 for software renewals each year thereafter. The Department estimates the total fiscal impact related to the 12 additional full-time employees as follows:
2011 2012 2013 2014
Salaries $ 537,810 $ 561,678 $ 586,326 $ 612,144
Benefits 276,358 297,094 319,498 343,785
Supplies, postage, etc. 14,400 14,400 14,400 14,400
Office space 32,400 32,400 32,400 32,400
Equipment 37,200 0 0 0
Computer hardware 10,800 0 0 0
Computer software 8,100 4,050 4,050 4,050
In-state travel 3,600 3,600 3,600 3,600
Total $ 920,668 $ 913,222 $ 960,274 $ 1,010,379