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Regular Session, 2010
SENATE BILL NO. 367
BY SENATOR MICHOT
PROCUREMENT CODE. Authorizes the use of reverse auctions by certain political
subdivisions. (7/1/10)
AN ACT1
To enact Part IV-A of Chapter 10 of Title 38 of the Louisiana Revised Statutes of 1950, to2
be comprised of R.S. 38:2271, relative to purchasing by certain public entities; to3
authorize the use of reverse auctions by certain political subdivisions for the4
purchase of materials, supplies, or equipment; to provide for an effective date; and5
to provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. Part IV-A of Chapter 10 of Title 38 of the Louisiana Revised Statutes of8
1950, to be comprised of R.S. 38:2271 is hereby enacted to read as follows:9
PART IV-A. PURCHASE OF MATERIALS, SUPPLIES, OR EQUIPMENT10
BY CERTAIN POLITICAL SUBDIVISIONS USING CERTAIN11
AUCTION METHODS12
ยง2271. Purchase of materials, supplies, or equipment by certain political13
subdivisions using certain auction methods14
A.(1) The bidding provisions of this Chapter shall not apply when a15
political subdivision purchases materials, supplies, or equipment using a reverse16
auction as authorized by, and in the manner provided herein. A political17 SB NO. 367
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words in boldface type and underscored are additions.
subdivision may use reverse auction only with the determination by its1
procurement officer that the best interests of the political subdivision would be2
served and that electronic online bidding is more advantageous than other3
procurement methods provided in this Chapter.4
(2) For the purposes of this Part: (a) "political subdivision" shall mean5
any political subdivision of the state, including but not limited to any political6
subdivision as defined in Article VI, Section 44 of the Constitution of Louisiana.7
(b) "Reverse auction" means a competitive online solicitation process on8
the Internet for equipment, supplies, and other materials in which vendors9
compete against each other online in real time in an open and interactive10
environment.11
B. Prior to the use of reverse auction authorized by this Part, the political12
subdivision shall develop policies and procedures that may require that:13
(1) Vendors register before the opening date and time, and as part of the14
registration, require that the vendors agree to any terms and conditions and15
other requirements of the solicitation.16
(2) Vendors be prequalified prior to placing bids and only allow bidders17
who are prequalified to submit bids.18
(3) The solicitation shall designate an opening date and time and the19
closing date and time. The closing date and time may be fixed or remain open20
depending on the structure of the item being bid.21
(4) At the opening date and time, the using agency shall begin accepting22
online bids and continue accepting bids until the bid is officially closed.23
Registered bidders shall be allowed to lower the price of their bid below the24
lowest bid posted on the Internet until the closing date and time.25
(5) Bidders' identities shall not be revealed during the bidding process;26
only the successively lower prices, ranks, scores, and related bid details shall be27
revealed.28
(6) All bids shall be posted electronically and updated on a real-time29 SB NO. 367
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basis.1
(7) The using agency shall retain the right to cancel the solicitation if it2
determines that it is in the agency's or the state's best interest.3
(8) The using agency shall retain its existing authority to determine the4
criteria that will be used as a basis for making awards.5
Section 2. This Act shall become effective on July 1, 2010; if vetoed by the governor6
and subsequently approved by the legislature, this Act shall become effective on July 1,7
2010, or on the day following such approval by the legislature, whichever is later.8
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Jay R. Lueckel.
DIGEST
Present law provides for the purchase of materials, supplies, and equipment by public
entities through advertisement for, receipt of, and opening of public bids.
Present law, relative to the La. Public Bid Law, R.S. 38:2211 defines "public entity" to
include, among others: each political subdivision as defined by Article VI, Section 44 of the
Constitution, and each public housing authority, public school board, and public officer.
Proposed law, provides for the approval of such local political subdivisions of a reverse
auction only with the approval of its procurement officer that the best interests of the public
entity would be served and that electronic online bidding is more advantageous than other
procurement methods.
Defines "reverse auction" as a competitive online solicitation process on the Internet for
equipment, supplies, and other materials in which vendors compete against each other online
in real time in an open and interactive environment.
Provides that prior to the use of reverse auction, a political subdivision shall develop policies
and procedures that may require, among other things, that:
(1) Vendors register before the opening date and time.
(2) Vendors be prequalified prior to placing bids.
(3) The solicitation designate an opening date and time and the closing date and time.
(4)At the opening date and time, the using agency begin accepting online bids and
continue accepting bids until the bid is officially closed.
(5) Bidders' identities not be revealed during the bidding process.
(6)All bids be posted electronically and updated on a real-time basis.
(7) The using agency retains the right to cancel the solicitation if it determines that it is
in the agency's or the state's best interest. SB NO. 367
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(8) The using agency retain its existing authority to determine the criteria that will be
used as a basis for making awards.
Effective July 1, 2010.
(Adds R.S. 38:2271)