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OLR Bill Analysis
sSB 391 (File 429, as amended by Senate "A")*
AN ACT IMPLEMENTING THE RECOMMENDATIONS OF THE
STATE CONTRACTING STANDARDS BOARD.
SUMMARY
This bill makes several changes in the laws governing the State
Contracting Standards Board (SCSB). It gives the board certain
protections against modifications to its budget request and reductions
in its allotments. It also (1) 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) and
(2) broadens the reasons for which SCSB may disqualify contractors,
bidders, and proposers.
The bill also makes changes to the privatization law, which generally
requires state contracting agencies to meet certain requirements when
they want to privatize services performed by state employees. Among
other things, the bill (1) adds to the analyses that agencies must conduct
for a proposed privatization, (2) lowers the number of employees who
must potentially be affected by a privatization to trigger a requirement
for the employees to be given an opportunity to reduce costs, and (3)
broadens the range of core governmental functions that have a
rebuttable presumption against privatization.
Additionally, the bill 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 (§
18).
It also specifies that the provisions of the law on state contracting
(Title 4e) supersede any contrary provision about a state contracting
agency in the general statutes (§ 19). Among other things, state law 2024SB-00391-R01-BA.DOCX
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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 numerous other minor, technical, and
conforming changes (§§ 2, 4-5, 7-8, 13 & 15-17).
*Senate Amendment “A” replaces the underlying bill and removes
provisions that would have subjected quasi-public agencies to SCSB’s
full authority.
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.
§ 6 — AGENCY PROCURE MENT OFFICERS
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 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, request for proposals, or other solicitation for 2024SB-00391-R01-BA.DOCX
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goods and services contains a notice about these rights; (2) contractors
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.
§ 14 — DISQUALIFICATION BY SCSB
The law generally allows SCSB to disqualify a contractor (including
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.
§§ 9 & 10 — PRIVATIZATION LAW
Business Case
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 of
the privatized service, such as its goals and their rationale, and options
for achieving them. The bill requires that the business case additionally
include analyses of a proposed contract’s 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.
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 2024SB-00391-R01-BA.DOCX
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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 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 privatization law establishes a rebuttable presumption that “core
governmental functions” should not be privatized. Under current law,
these generally include functions such as inspecting for adherence to
health and safety standards, enforcing statutory requirements
governing public health or safety, and criminal or civil law enforcement.
The bill expands the core governmental functions subject to the
presumption to also include providing essential human services to state
residents who would otherwise lack the support needed to assure basic
human needs.
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.
§§ 11 & 12 — EMERGENCY PRO CUREMENTS
Purchases of $10,000 or Less (§ 11)
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 2024SB-00391-R01-BA.DOCX
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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 about 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 (§ 12)
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, the (1) determination must
also be in the contract file and sent to the governor and legislative
leaders and (2) emergency procurement must be made with
competition, as practicable under the circumstances.
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).
COMMITTEE ACTION
Government Administration and Elections Committee
Joint Favorable Substitute
Yea 13 Nay 6 (03/22/2024)