Bill Summary – FastDemocracy

HOUSE BILL NO. 5537
     March 05, 2024, Introduced by Reps. Smit, Beeler, Rigas, Fox, Bierlein, Bezotte, BeGole,
       Alexander, Thompson, Kunse, Harris, Wozniak, Borton, Markkanen, Johnsen, DeBoyer,
       Cavitt and Posthumus and referred to the Committee on Government Operations.
            A bill to amend 1984 PA 431, entitled
    "The management and budget act,"
    by amending sections 115, 241, 261, 305, and 404 (MCL 18.1115,
1241, 18.1261, 18.1305, and 18.1404), section 115 as amended by
PA 389, section 241 as amended by 2012 PA 430, section 261 as
    amended by 2020 PA 174, and sections 305 and 404 as amended by 1999
    PA 8.
                     THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
         Sec. 115. (1) "Institution of higher education" or
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 "university" means a state supported 4-year college or university.
       (1) (2) "Information technology services" means services
 involving all aspects of managing and processing information,
 including, but not limited to, all of the following:
       (a) Application development and maintenance.
       (b) Desktop computer support and management.
       (c) Mainframe computer support and management.
       (d) Server support and management.
       (e) Local area network support and management, including, but
 not limited to, wireless networking.
       (f) Information technology project management.
       (g) Information technology planning and budget management.
       (h) Telecommunication services, security, infrastructure, and
 support.
       (2) "Institution of higher education" or "university" means a
 state supported 4-year college or university.
       (3) "JCOS" means the joint capital outlay subcommittee of the
 appropriations committees.
       (4) "Merit" means a reasonable expectation, based on objective
 criteria such as experience, education, and training, that a
 prospective employee can adequately perform the duties of the job.
       (5) (4) Except as used in sections 284 to 292, "record" means
 a public record, as that term is defined in section 2 of the
 freedom of information act, 1976 PA 442, MCL 15.232.
       (6) (5) "State agency" means a department, board, commission,
 office, agency, authority, or other unit of state government. State
 agency does not include an institution of higher education or a
 community college or, for purposes of article 2 or 3, the
 legislative branch of government. For purposes of article 2 or 3,
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 except for those sections pertaining to the authorization,
 planning, construction, and funding of a capital outlay project,
 including construction of a facility to house offices or functions
 necessary for operation of the judicial branch of government, state
 agency does not include the judicial branch of government.
       (7) (6) "Unit of local government" means a political
 subdivision of this state, including school districts, community
 college districts, intermediate school districts, cities, villages,
 townships, counties, and authorities, if the political subdivision
 has as its primary purpose the providing of local governmental
 service for citizens in a geographically limited area of the state
 and has the power to act primarily on behalf of that area.
       Sec. 241. (1) Except for the contracts permitted in section
 240, a contract shall must not be awarded for the construction,
 repair, remodeling, or demolition of a facility unless the contract
 is let pursuant to in accordance with a bidding procedure that is
 approved by the board. The department shall issue directives
 prescribing procedures to be used to implement this section. The
 procedures shall must require a competitive solicitation in the
 award of any contract for construction, repair, remodeling, or
 demolition of a facility.
       (2) The department may award or approve the award, if the
 board approves, of construction contracts to construct a project
 for which the director is the agent and may expend, for the
 purposes and in the manner set forth, the amounts appropriated. The
 director is not the agent for a community college or institution of
 higher education, but may act in that capacity upon on the specific
 request of a community college or institution of higher education.
       (3) At the time that a person submits a proposal for the award
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 of a contract under this section, the person must submit a form
 prescribed by the department under which the person attests under
 penalty of perjury and subject to a civil fine of $5,000.00 that
 the person uses only hiring practices based on the merit of
 prospective employees.
       (4) (3) 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, as that term is
 defined in section 261. If the qualified disabled veteran otherwise
 meets the requirements of the contract solicitation and with the
 preference is the lowest bidder, the department shall must enter
 into a construction 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 must be
 awarded the contract under this act.
       (5) The department shall not award a contract under this
 section to a person to which either or both of the following apply:
       (a) The person uses hiring practices based on criteria other
 than the merit of prospective employees.
       (b) The person does not submit the form described in
 subsection (3).
       (6) (4) Subject to subsection (3), (4), and except as
 otherwise provided in subsection (5), for projects funded in whole
 or part with state funds, the construction contract award shall
 must be made to the responsive and responsible best value bidder.
 As used in this subsection, "responsive and responsible best value
 bidder" means a bidder who that meets all the following:
       (a) A bidder who that complies with all bid specifications and
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 requirements.
       (b) A bidder who that has been determined by the department to
 be responsible by the following criteria:
       (i) The bidder's financial resources.
       (ii) The bidder's technical capabilities.
       (iii) The bidder's professional experience.
       (iv) The bidder's past performance.
       (v) The bidder's insurance and bonding capacity.
       (vi) The bidder's business integrity.
       (c) A bidder who that has been selected by the department
 through a selection process that evaluates the bid on both price
 and qualitative components to determine what is the best value for
 this state. Qualitative components may include, but are not limited
 to, all of the following:
       (i) Technical design.
       (ii) Technical approach.
       (iii) Quality of proposed personnel.
       (iv) Management plans.
       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 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,
 preference shall must 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,
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 1994 PA 451, MCL 324.1401 to 324.1429, or to biobased products
 whose content is sourced in this state. 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 the designated representative of the
 director.
       (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.
       (d) (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.
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        (e) (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 on a finding that a state agency did not comply with
 departmental procurement directives. If a state agency has the
 department's procurement authority delegated to it under this
 subsection and if it chooses to exercise an option under an
 existing procurement contract to continue that procurement
 contract, before exercising that option, the state agency shall
 must first obtain written approval from the department that
 exercising the option is in the best interest of this state.
        (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.
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       (8) At the time that a person submits a proposal for the award
 of a contract under this section, the person must submit a form
 prescribed by the department under which the person attests under
 penalty of perjury and subject to a civil fine of $5,000.00 that
 the person uses only hiring practices based on the merit of
 prospective employees.
       (9) (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 must 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 must be awarded the contract under this act.
       (10) (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 that
 submitted a bid for a state procurement contract.
       (b) The number of qualified disabled veterans who that entered
 into procurement contracts with this state and the total value of
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 those procurement contracts.
       (c) Whether the department achieved the goal described in this
 subsection.
       (d) The recommendations described in subsection (10).(11).
       (11) (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 must be based upon on
 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.
       (12) (11) To assist the department in reaching the goal
 described in subsection (9), (10), the governor shall recommend to
 the legislature changes in programs to assist businesses owned by
 qualified disabled veterans.
       (13) (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 may
 not engage in, the boycott of a person based in or doing business
 with a strategic partner.
       (14) The department shall not award a contract under this
 section to a person to which either or both of the following apply:
       (a) The person uses hiring practices based on criteria other
 than the merit of prospective employees.
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       (b) The person does not submit the form described in
 subsection (8).
       (15) (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 that term is 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.
       (16) (14) The department shall develop policies and procedures
 that require all procurement contracts entered into by the
 department or a state agency, including departments that have
 delegated procurement authority under this act, to include
 performance-related liquidated damages or performance targets with
 incentives in all procurement contracts. The department shall also
 develop policies and procedures that require the department or
 state agency to enforce these provisions. Departments or state
 agencies acting under delegated authority shall inform the
 department of relevant performance issues. Exceptions to the
 inclusion or enforcement of performance-related contract provisions
 may only be granted by the department