23.8007.01000
Sixty-eighth
Legislative Assembly SENATE BILL NO. 2042
of North Dakota
Introduced by
State and Local Government Committee
(At the request of the Office of Management and Budget)
1 A BILL for an Act to create and enact sections 54-44.4-05.1 and 54-44.4-09.1 of the North
2 Dakota Century Code, relating to resolution of identical bids or proposals in procurement and
3 secretary of state registration; and to amend and reenact sections 44-08-01, 44-08-02,
4 54-44.4-02, 54-44.4-05, 54-44.4-09, 54-44.4-13, and subsection 2 of section 54-44.4-14 of the
5 North Dakota Century Code, relating to reciprocal preference requirements in procurement,
6 resident North Dakota bidder, seller, vendor, offeror, or contractor, exemptions from
7 procurement, procurement solicitation methods, bidder registration requirements, approved
8 vendors, and public notices.
9 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
10 SECTION 1. AMENDMENT. Section 44-08-01 of the North Dakota Century Code is
11 amended and reenacted as follows:
12 44-08-01. Preference to North Dakota bidders, sellers, and contractorsCompetitive
13 purchasing required.
14 1. The office of management and budget, any other state entity, and the governing body
15 of any political subdivision of the state in purchasing any goods, merchandise,
16 supplies, or equipment of any kind, or contracting to build or repair any building,
17 structure, road, or other real property, shall give preference to bidders, sellers, or
18 contractors resident in North Dakota. The preference must be equal to the preference
19 given or required by the state of the nonresident bidder, seller, or contractor.
20 2. A state entity authorized to accept bids shall give preference to a resident North
21 Dakota bidder when accepting bids for the provision of professional services, including
22 research and consulting services. The preference must be equal to the preference
23 given or required by the state of the nonresident bidder.
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1 3. The office of management and budget, any other state entity, and the governing body of
2 any political subdivision of the state in specifying or purchasing any goods, merchandise,
3 supplies, or equipment, may not specify any trademarked or copyrighted brand or name, nor the
4 product of any one manufacturer, nor any patented product, apparatus, device, or equipment,
5 when the same will prevent proper competition, unless bidders also are asked for bids or offers
6 upon other articles of like nature, utility, and merit. When it is advantageous that the purchase
7 be of a particular brand of product or products of a particular manufacturer to the exclusion of
8 competitive brands or manufacturers, the purchasing board or entity must document those
9 circumstances and provide written justification for the proprietary specification or purchase. The
10 purchasing board or entity shall procure the proprietary product through a competitive process
11 unless the needed product is available exclusively from one source of supply or other
12 circumstances exist under which competition can be waived.
13 SECTION 2. AMENDMENT. Section 44-08-02 of the North Dakota Century Code is
14 amended and reenacted as follows:
15 44-08-02. Resident North Dakota bidder, seller, vendor, offeror, and contractor
16 defined.
17 The term "a resident North Dakota bidder, seller, vendor, offeror, or contractor" when used
18 in section 44-08-01, unless the context thereof clearly provides otherwise, means a bidder,
19 seller, vendor, offeror, or contractor who has maintained a bona fide place of business within
20 this state for at least one year prior to the date on which a contract was awarded.
21 SECTION 3. AMENDMENT. Section 54-44.4-02 of the North Dakota Century Code is
22 amended and reenacted as follows:
23 54-44.4-02. Office of management and budget purchasing services.
24 The office of management and budget shall purchase or lease or otherwise arrange for the
25 procurement, for all state agencies and institutions in the executive branch of state government,
26 all materials, furniture, fixtures, printing, insurance, services, and other commodities. The
27 International Peace Garden may participate in the procurement authorized by this section. The
28 following commodities and services, however, are not subject to the procurement requirements
29 of this chapter:
30 1. Land, buildings, space, or the rental thereof.
31 2. Telephone and telegraph service and electrical light and power services.
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1 3. Public books, maps, periodicals, resource materials, and technical pamphlets.
2 4. Department of transportation materials, equipment, and supplies in accordance with
3 section 24-02-16.
4 5. Procurements by the industrial commission for energy-related programs under
5 chapters 17-05, 54-17.5, 54-17.6, 54-17.7, 54-63, and 54-63.1 and under those
6 statutes in title 38 authorizing the industrial commission to perform well and hole
7 pluggings, reclamation work, equipment removal, leak prevention, and similar work.
8 6. Services for the maintenance or servicing of equipment by the manufacturer or
9 authorized servicing agent of that equipment when the maintenance or servicing can
10 best be performed by the manufacturer or authorized service agent, or when such a
11 contract would otherwise be advantageous to the state.
12 7. Emergency purchases the office of management and budget or a purchasing agency
13 cannot make within the required time and which involve public health or public safety,
14 or when immediate expenditures are necessary for repairs of state property to protect
15 it against further loss or damage, or to prevent or minimize serious disruption in state
16 services.
17 a. Emergency purchases made under this subsection must treat all bidders fairly
18 and promote competition as is practicable under the circumstances;
19 b. The procurement file must contain a written determination of:
20 (1) The basis for the emergency; and
21 (2) The basis for the selection of the particular contractor.
22 c. If the emergency circumstances warrant a noncompetitive purchase, the office of
23 management and budget or the purchasing agency shall document within the
24 procurement file a written determination of the basis for the noncompetitive
25 purchase, including the circumstances that justified the noncompetitive purchase.
26 d. If the emergency purchase is subject to federal funding reimbursement, the office
27 of management and budget or the purchasing agency shall ensure the
28 procurement procedures and documentation are adequate to satisfy
29 requirements for federal reimbursement.
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1 e. If time allows, emergency purchases for commodities under this subsection may
2 require a sample for use in determining whether an offered product meets
3 specifications.
4 8. Commodities and services costing less than a specified amount as determined by
5 written directive by the director of the office of management and budget.
6 9. Specified commodities and services as determined by written directive by the director
7 of the office of management and budget.
8 10. Employee benefit services, trust-related services, and investment management
9 services obtained by an agency with a fiduciary responsibility regarding those
10 services.
11 11. Services to extract, tow, store, and dispose of abandoned or submerged vehicles as
12 defined in chapter 23.1-15.
13 All purchases made by the office of management and budget or a state agency or institution to
14 which authority to purchase has been delegated by the office of management and budget must
15 be made in accordance with this chapter, rules adopted under this chapter, and written policies
16 of the office of management and budget.
17 SECTION 4. AMENDMENT. Section 54-44.4-05 of the North Dakota Century Code is
18 amended and reenacted as follows:
19 54-44.4-05. Competitive, limited competitive, noncompetitive, and negotiated
20 purchases - Exempt records.
21 1. Except as otherwise provided in sectionsections 12-48-03.1 and 44-08-01, chapter
22 25-16.2, and this chapter, purchasing contracts must be awarded through a
23 competitive bidding process to the lowest responsible bidder considering conformity
24 with specifications, terms of delivery, and quality and serviceability, unless it is
25 determined to be advantageous to the state to select a contractor through a
26 competitive proposal process pursuant to section 54-44.4-10 using other or additional
27 criteria. Notwithstanding this section, the director of the office management and
28 budget or the director's designee may determine a different procurement process is in
29 the best interest of the state and shall document the circumstances, procurement
30 process, and basis for contract award in the procurement file.
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1 2. The procurement officer may reject any or all bids or proposals or negotiate for a lower
2 price with a successful bidder or offeror. Each bid or proposal received, with the name
3 of the bidder or offeror, must be recorded. The office of management and budget may
4 enter into term contracts for the acquisition of commodities or services and may make
5 multiple awards for term commodity or service contracts when it deems a multiple
6 award to be in the best interests of the state.
7 3. All bids received under this chapter pursuant to a competitive sealed bid are exempt
8 records under subsection 5 of section 44-04-17.1 until the date and time the bids are
9 opened.
10 2.4. The office of management and budget shall adopt rules specifying the circumstances
11 under which competition may be waived or limited, when negotiation may be used,
12 and specifying the required justifications and procedures for using those methods of
13 purchasing. The office of management and budget shall adopt rules related to sending
14 notice of intent to make limited competitive, noncompetitive, and negotiated purchases
15 in accordance with this chapter. The notice must describe the needed commodity or
16 service and the intended procurement method and must state that vendorspersons
17 are permitted to submit bids or proposals for contracts to be awarded under this
18 section. The circumstances that may permit limited competitive, noncompetitive, or
19 negotiated purchases include:
20 a. The commodity or service is available from only one source.
21 b. The commodity or service is to be purchased for experimentation or trial.
22 c. No acceptable bid or proposal was received pursuant to a competitive bidding or
23 competitive proposal process.
24 d. Commodities are being purchased for over-the-counter resale.
25 e. Acceptable commodities or services are produced or provided by correctional
26 institutions or other government agencies or a work activity center as defined in
27 section 25-16.2-01.
28 f. The anticipated cost of purchasing specified commodities or services is less than
29 an amount determined by the office of management and budget which would
30 justify the expense of a competitive bidding or competitive proposal process.
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1 g. A used commodity is advantageous to the state and the commodity is available
2 only on short notice.
3 h. The commodity is a component or replacement part for which there is no
4 commercially available substitute and which can be obtained only from the
5 manufacturer.
6 i. Compatibility with equipment currently owned by the state is essential to the
7 proper functioning of that equipment.
8 j. The agency provides documentation indicating that the services or the
9 circumstances are of such a nature that deviation from the procurement
10 procedure is appropriate.
11 k. Recurring support costs associated with implemented information technology
12 solutions, including licensing, service agreements, maintenance, and
13 subscriptions for software as a service, platform as a service, and infrastructure
14 as a service.
15 SECTION 5. Section 54-44.4-05.1 of the North Dakota Century Code is created and
16 enacted as follows:
17 54-44.4-05.1. Resolution of tie bids or proposals.
18 In the event that two or more bids or proposals contain identical pricing or receive identical
19 evaluation scores, preference must be given to a resident North Dakota bidder, seller, vendor,
20 offeror, or contractor as defined in section 44-08-02.
21 SECTION 6. AMENDMENT. Section 54-44.4-09 of the North Dakota Century Code is
22 amended and reenacted as follows:
23 54-44.4-09. Approved vendorsBidders list.
24 1. The office of management and budget shall establish and maintain current listsa
25 bidders list of persons that desire to provide commodities or services to the state.
26 Every person that desires to bid or submit a proposal on contracts for commodities or
27 services awarded under this chapter must be an approved vendor in order to be
28 placed on the bidders listbe informed of government procurement opportunities. The
29 office of management and budget or the purchasing agency shall usenotify those on
30 the list when issuing invitation for bids or request for proposals over the amount
31 established for small purchases, except as otherwise provided in this section. The
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1 office of management and budget or the purchasing agency shall usenotify those on
2 the list when sending notice of intent to make cooperative, limited competitive,
3 noncompetitive, and negotiated purchases.
4 2. To become an approved vendorbe placed on the bidders list a person shall file an
5 application with the office of management and budget. The application must contain
6 information requested by the office of management and budget, including business
7 and persons' names, telephone numbers, addresses, federal tax identification
8 numbers, type of business organization, the types of commodities or services for
9 which the applicant is interested in receiving solicitations, and other business
10 information the office of management and budget determines relevant. The application
11 must also contain a statement appointing the secretary of state as the applicant's
12 agent for service of process pursuant to subsection 3. The application must be signed
13 and certified by an owner, partner, or company officer authorized by company bylaws
14 or other organizational document to bind the company. The signature requirement may
15 include the use of an electronic signature as defined in section 9-16-01 when
16 authorized under section 9-16-17. The office of management and budget may require
17 proof of the signing person's authority by certified copy of appropriate company
18 documents.
19 3. At the time of filing the application to become an approved vendor, the applicant, if
20 organized as a corporation, limited liability company, limited liability partnership, or
21 limited partnership, must be properly and currently registered with the secretary of
22 state according to its type of business organization as a corporation under
23 chapter 10-19.1, a limited liability company under chapter 10-32.1, a limited liability
24 partnership under chapter 45-22, or a limited partnership under chapter 45-10.2. Any
25 exemptions to registration under the above chapters that would otherwise apply to
26 those entities organized as such do not apply to this section and registration must be
27 made for the applicant to become an approved vendor. Applicants for approved vendor
28 status using a trade name or a fictitious partnership name must be in full compliance
29 with chapter 47-25 or 45-11 at the time of making the application. Whenever any
30 registration required by this section is canceled, revoked, or not renewed, the vendor
31 ceases to be an approved vendor.
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