Bill Summary – FastDemocracy

Division of the Budget
Landon State Office Building                                                                         Phone: (785) 296-2436
900 SW Jackson Street, Room 504                                                                      larry.campbell@ks.gov
Topeka, KS 66612                                 Division of the Budget                             http://budget.kansas.gov
Larry L. Campbell, Director                                                                        Laura Kelly, Governor


                                                    January 23, 2020


          The Honorable Sean Tarwater, Chairperson
          House Committee on Commerce, Labor and Economic Development
          Statehouse, Room 151D-S
          Topeka, Kansas 66612
          Dear Representative Tarwater:
                    SUBJECT:      Fiscal Note for HB 2455 by House Committee on Commerce, Labor and
                                  Economic Development
                  In accordance with KSA 75-3715a, the following fiscal note concerning HB 2455 is
          respectfully submitted to your committee.
                  HB 2455 would incorporate Job Corps-aligned businesses into the required considerations
          for state contracts. The bill defines “Job Corps-aligned business.” Under current law, a contract
          is awarded to a certified business or disabled veteran business, that is also a responsive bidder,
          whose total bid cost is not more than 10.0 percent higher than the lowest competitive bid. The
          contract is required to contain a promise by the certified business that the percentage of employees
          that are individuals with disabilities will be maintained throughout the contract term and a
          condition that the certified business will not subcontract for goods or services in an aggregate
          amount of more than 25.0 percent of the total bid cost.
                  The bill would specify that except when a contract is awarded for the above provision, a
          contract would be awarded to a Job Corps-aligned business that is also a responsible bidder, whose
          total bid cost is not more than 10.0 percent higher than the lowest competitive bid. The contract
          would include the following:
                    1. A promise by the Job Corps-aligned business that at least 5.0 percent of its employees
                       are Job Corps Work-based Learning Program graduates and the percentage of
                       employees that are Job Corps Work-based Learning Program graduates would not
                       decrease throughout the contract term or that the business has entered into a
                       memorandum of understanding with Job Corps for a work-based learning program that
                       would be maintained throughout the contract term, where at least 5.0 percent of its
                       employees are Job Corps Work-based Learning Program graduates; and
The Honorable Sean Tarwater, Chairperson
Page 2—HB 2455

       2. A condition that the Job Corps-aligned business would not subcontract for goods or
          services in an aggregate amount of more than 25.0 percent of the total bid cost.
       The bill would also require that on and after January 13, 2020, at the beginning of each
regular Session of the Legislature, the Secretary of Administration and the Secretary of Labor
would jointly submit to various legislative committees specified in the bill a written report on the
Job Corps-Aligned Business Contract Preference Program that includes the following information:
       1. The number of Job Corps-aligned businesses certified by the Department of
          Administration as eligible for the award of a contract during the previous fiscal year;
       2. The number of certified Job Corps-aligned businesses awarded contracts during the
          previous fiscal year; and
       3. The number of contracts awarded to each certified Job Corps-aligned business during
          the previous fiscal year.
        The Department of Administration states that it cannot estimate a fiscal effect for the bill
because the agency does not know how many vendors utilize the Job Corps-Aligned Business
Contract Preference Program’s individuals as employees or whether the number of employees
working for the vendor would rise to the level of 5.0 percent of their employees in order to qualify
for the preference. Further, the Department indicates it does not have a way of estimating how
many vendors would seek to exercise the preference, the number of bid events involved with the
preference, and the value of the bid events involved.
         The Kansas Department of Labor indicates enactment of the bill would have a negligible
fiscal effect on the agency’s operations. Any fiscal effect associated with HB 2455 is not reflected
in The FY 2021 Governor’s Budget Report.


                                                     Sincerely,

                                                     Larry L. Campbell
                                                     Director of the Budget


cc: Jeff Scannell, Department of Administration
    Dawn Palmberg, Department of Labor
    Sherry Rentfro, Department of Commerce
Statutes affected: 
As introduced: 75-3740