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OLR Bill Analysis
sSB 391
AN ACT IMPLEMENTING THE RECOMMENDATIONS OF THE
STATE CONTRACTING STANDARDS BOARD.
SUMMARY
This bill makes several changes that expand the State Contracting
Standards Board’s (SCSB) powers and duties. It grants the board certain
protections against modifications to its budget request and reductions
in its allotments. It also subjects quasi-public agencies to the board’s full
authority, including the law on privatization contracts, by making them
“state contracting agencies” under the board’s authorizing statutes.
Additionally, it makes other changes to the privatization law (e.g.,
adding to the analyses that agencies must conduct for a proposed
privatization).
Separately, the bill requires agency procurement officers to advise
bidders, proposers, and contractors about certain rights enforced by
SCSB (e.g., the right to contest a contract solicitation or award). It also
requires contracting agencies to (1) post information on their websites
about certain emergency procurements they enter into and (2) evaluate
bidders’ and proposers’ financial condition before selecting one to
perform a contract or subcontract (§ 41). It also broadens the reasons for
which SCSB may disqualify contractors, bidders, and proposers.
The bill specifies that the provisions of the law on state contracting
(Title 4e) supersede any contrary provision about a state contracting
agency or quasi-public agency in the general statutes (§ 42). Among
other things, state law includes provisions on state agency personal
services agreements (CGS § 4-212 et seq.); goods and services purchases
(CGS § 4a-50 et seq.); and capital projects (CGS § 4b-51 et seq.).
Lastly, the bill makes other minor, technical, and conforming changes 2024SB-00391-R000429-BA.DOCX
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(e.g., § 40).
EFFECTIVE DATE: July 1, 2024, except that the provision on budget
request modifications and allotment reductions is effective upon
passage.
§§ 1 & 3 — SCSB BUDGET AND STAFFING
The bill requires the Office of Policy and Management (OPM)
secretary to include the SCSB executive director’s estimates of the
board’s expenditure requirements and recommended adjustments and
revisions in the proposed budget documents that OPM submits to the
legislature, without altering them. It also prohibits the governor from
reducing SCSB’s allotment requisitions or allotments in force. Existing
law grants these same protections to the (1) Office of State Ethics (CGS
§ 1-81a), (2) Freedom of Information Commission (CGS § 1-205a), and
(3) State Elections Enforcement Commission (CGS § 9-7c).
Separately, the bill requires that SCSB employ at least five full-time
employees, subject to the State Personnel Act.
§§ 2-39 — SCSB AUTHORITY OVER QUAS I-PUBLIC AGENCIES
Under current law, SCSB has limited authority over quasi-public
agencies, as, with one exception, SCSB’s authorizing statutes generally
exclude them from the definition of “state contracting agency.” (Most of
SCSB’s powers and duties apply to state contracting agencies only, see
BACKGROUND.)
The bill instead subjects quasi-public agencies to SCSB’s full
authority, with limited exceptions. It does so by adding quasi-public
agencies to the definition of “state contracting agency” (see § 2) and
making conforming changes throughout the bill. Under existing law, the
state has 16 quasi-public agencies (CGS § 1-120).
The table below lists a selection of SCSB statutes applicable to state
contracting agencies that the bill extends to quasi-public agencies.
However, the bill does not extend provisions on contractor, bidder, or
proposer suspensions issued by state agencies (§§ 22-24). 2024SB-00391-R000429-BA.DOCX
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Table: Selected SCSB Statutes Applicable to Quasi-Public Agencies
Under the Bill
Bill Section
(if applicable)
Statute Description
4 CGS § 4e-3
SCSB may exercise quasi-public agencies’ contracting-
related powers, rights, and duties
5 CGS § 4e-4
SCSB must review, certify, and periodically recertify
quasi-public agency procurement processes
6 CGS § 4e-5 Quasi-public agencies must appoint a procurement officer
— CGS § 4e-6
SCSB must audit each quasi-public agency’s compliance
with procurement laws and regulations every three years
7 CGS § 4e-7
SCSB may, under specified conditions, (1) review and
terminate quasi-public agency contracts and procurement
agreements or (2) restrict or terminate the quasi-public
agency’s ability to enter into contracts or procurement
agreements
10 CGS § 4e-14
Quasi-public agency contracts must contain provisions
ensuring accountability, transparency, and results-based
outcomes, as prescribed by SCSB (it appears SCSB has
not prescribed these standards for state contracting
agencies to date)
11-13 CGS § 4e-16
Quasi-public agencies must comply with the privatization
law (see below)
— CGS § 4e-19
Quasi-public agencies must use specified procurement
methods when purchasing goods and services (these
provisions require SCSB to adopt implementing
regulations before they become operative, but the board
has not adopted them to date)
— CGS § 4e-39
Quasi-public agency solicitations or proposed awards are
subject to cancellation if SCSB finds that a violation of the
law has occurred
21 CGS § 4e-34
SCSB may disqualify contractors from bidding on,
applying for, or participating in state contracts with quasi-
public agencies for up to five years if certain violations
occur (see below)
25 CGS § 4e-40
SCSB may, after a quasi-public agency contract is
awarded, take certain actions, including terminating the
contract, if SCSB finds it violates the law
Separately, the bill adds four representatives of quasi-public agencies
to the Contracting Standards Advisory Council, two each appointed by
the House speaker and Senate president (§ 8). By law, the council must
meet at least four times per year and make recommendations to SCSB
for improving procurement processes. 2024SB-00391-R000429-BA.DOCX
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§§ 2 & 11-14 — PRIVATIZATION LAW
Application to Quasi-Public Agencies
The bill applies the privatization law to quasi-public agencies. Under
the privatization law, if a state contracting agency seeks to enter into a
contract that privatizes services performed by state employees, it
generally must do a cost-benefit analysis and submit a business case to
SCSB for its approval. The business case must include, among other
things, the cost-benefit analysis and 11 other analyses (the bill adds two
more, see below) relating to the privatized service, such as its goals and
their rationale, and options for achieving them (CGS § 4e-16(d)). An
agency may publish notice soliciting bids for a privatization contract
only after the board approves the business case (CGS § 4e-16(i)).
For privatization contracts not subject to this requirement (i.e.,
contracts for services that are currently privatized), contracting agencies
must instead evaluate the contract to determine if entering into or
renewing it is the most cost-effective way to deliver the service. (The bill
also expands SCSB’s role in this evaluation, see below.)
Other Changes
Business Case. As described above, existing law requires
contracting agencies to develop a business case, consisting of multiple
analyses, for a service it seeks to privatize. The bill requires that the
business case additionally include analyses of a proposed contract’s (1)
potential impact on workers of color or workers who are women,
including whether it will lessen or increase historical patterns that
produce inequities between these workers and other workers, and (2)
qualitative impact on the existing state workforce. (The bill does not
further specify what factors comprise a “qualitative impact.”)
Employee Opportunity to Reduce Costs. Under current law, if a
proposed privatization contract would result in the layoff, transfer, or
reassignment of at least 100 state agency employees, then the agency
generally must give the employees (1) an opportunity to reduce the costs
of conducting the potentially privatized operations and (2) reasonable
resources to encourage and help them to organize and submit a bid to 2024SB-00391-R000429-BA.DOCX
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provide the potentially privatized services. The bill decreases, from 100
to 25, the number of employees who must potentially be affected by a
privatization to trigger this requirement. As under current law, the state
agency retains sole discretion over whether to proceed with the
privatization as long as SCSB approves the business case.
Core Governmental Function. The bill expands the definition of
“core governmental function” under the privatization statute to include
providing essential human services to state residents who would
otherwise lack the support necessary to assure basic human needs. The
privatization statute establishes a rebuttable presumption that “core
governmental functions” should not be privatized.
Cost-Effectiveness Evaluation. For privatization contracts not
subject to the business case requirement (i.e., contracts for services that
are currently privatized), current law requires contracting agencies to
evaluate the contract, using a template the OPM secretary prescribes, to
determine if entering into or renewing it is the most cost-effective way
to deliver the service. The bill requires that the (1) evaluation be
submitted to the board, rather than being subject to the secretary’s
verification and (2) secretary consult with (a) SCSB when prescribing the
evaluation template and (b) the chief procurement officer when
deciding whether to waive the evaluation requirement because of
exigent or emergent circumstances.
§ 6 — AGENCY PROCUREMENT O FFICERS
Existing law requires the head of each state contracting agency to
appoint an agency procurement officer who must, among other things,
(1) assure that contractors are properly screened before a contract award
and (2) evaluate contractor performance during and at the conclusion of
a contract. (The bill extends this requirement to quasi-public agencies.)
The bill additionally requires procurement officers to advise bidders,
proposers, and contractors about their right to contest a contract
solicitation or award. Specifically, procurement officers must ensure
that (1) each bid, RFP (request for proposals), or other solicitation for
goods and services contains a notice about these rights; (2) contractors 2024SB-00391-R000429-BA.DOCX
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are advised about these rights before entering a contract; and (3)
unsuccessful bidders, proposers, and respondents are advised about
these rights when the contract is awarded.
§§ 17 & 18 — EMERGENCY PROCUREMEN TS
Purchases of $10,000 or Less (§ 17)
The law allows SCSB, in consultation with the Department of
Administrative Services (DAS) commissioner, to waive competitive
bidding or negotiation requirements for minor, nonrecurring, or
emergency purchases of $10,000 or less. The bill allows it to do so upon
application by a contracting agency. It requires contracting agencies that
get this waiver to post notice of the emergency purchase on their
websites before making the purchase. (Existing law also allows the DAS
commissioner to waive these requirements for purchases of $25,000 or
less for similar reasons without consulting the board (CGS § 4a-57(b)).)
Threats to Public Health, Welfare, or Safety (§ 18)
Current law requires SCSB to adopt regulations allowing emergency
procurements when a threat to public health, welfare, or safety exists.
(In practice, the board has not done so.) The bill instead directly allows
contracting agencies to enter into these procurements and makes the
board’s adoption of regulations permissive.
The bill requires contracting agencies to (1) notify SCSB about the
need for the procurement and (2) post on their websites their written
determination of the basis for the emergency and selection of the
particular contractor. As under existing law, this determination must
also be in the contract file and sent to the governor and legislative
leaders.
Existing law allows the DAS commissioner or the state’s chief
information officer to allow emergency procurements, subject to the
Standardization Committee’s approval if the cost is $100,000 or more
(CGS § 4a-58).
§ 21 — DISQUALIFICATION BY SCSB
The law generally allows SCSB to disqualify a contractor (including 2024SB-00391-R000429-BA.DOCX
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bidders and proposers) from bidding on, applying for, or participating
in state contracts for up to five years if it finds that certain violations
occurred. Under current law, the board may do this for the fraudulent
or criminal conduct of any officer, director, shareholder, partner,
employee, or other individual associated with the contractor, if the (1)
conduct occurred in connection with the person performing their duties
on the contractor’s behalf and (2) contractor knew or had reason to know
about it. The bill more broadly allows the board to impose the
disqualification for any of these individuals’ fraudulent or criminal
conduct, regardless of whether it occurred on the contractor’s behalf or
the contractor knew about it. It also applies the disqualification
provisions to contracts with quasi-public agencies.
BACKGROUND
SCSB Authority Over Quasi-Public Agencies
Attorney General Opinion. In a 2021 opinion (Attorney General
Opinion 2021-01), the attorney general concluded that most SCSB
statutes give the board authority over 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.”
Exceptions. Under current law, the (1) State Education Resource
Center is a state contracting agency under an SCSB statute governing
procurement methods (CGS § 4e-19) and (2) Connecticut Port Authority
is a state contracting agency under all SCSB authorizing statutes except
the privatization law (CGS § 15a-31b).
COMMITTEE ACTION
Government Administration and Elections Committee
Joint Favorable Substitute
Yea 13 Nay 6 (03/22/2024)