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1 HOUSE BILL NO. 741
2 INTRODUCED BY B. MERCER
3
4 A BILL FOR AN ACT ENTITLED: “AN ACT GENERALLY REVISING STATE PROCUREMENT LAWS;
5 PROVIDING AND REVISING DEFINITIONS; REVISING EXCEPTIONS TO PROCUREMENT LAWS;
6 AMENDING SECTIONS 18-4-123, 18-4-132, 53-21-1007, AND 90-14-110, MCA; REPEALING SECTION 80-
7 11-225, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE.”
8
9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
10
11 Section 18-4-123, MCA, is amended to read:
12 "18-4-123.
13 meaning is prescribed for a particular section, the following definitions apply:
14 (1) "Business" means a corporation, partnership, individual, sole proprietorship, joint-stock
15 company, joint venture, or other private legal entity.
16 (2) "Change order" means a written order, signed by an authorized department representative,
17 directing the contractor to make changes that the changes clause of the contract authorizes the department to
18 order without the consent of the contractor.
19 (3) "Contract" means all types of state agreements, regardless of what they may be called, for the
20 procurement or disposal of supplies or services.
21 (4) "Contract modification" means a written alteration in specifications, delivery point, rate of
22 delivery, period of performance, price, quantity, or other provisions of a contract accomplished by mutual action
23 of the parties to the contract.
24 (5) "Contractor" means a person having a contract with a governmental body.
25 (6) "Data" means recorded information, regardless of form or characteristic.
26 (7) "Department" means the department of administration.
27 (8) "Designee" means an authorized representative of a person holding a superior position.
28 (9) "Director" means the director of the department of administration. ****
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1 (10) "Employee" means an individual drawing a salary from a governmental body, whether elected
2 or not, and any noncompensated individual performing personal services for a governmental body.
3 (11) "Facility" means a contracted medical provider that offers services to beneficiaries, such as a
4 hospital, nursing facility, or home health agency, for the department of public health and human services.
5 (11) (12) "Governmental body" means a department, commission, council, board, bureau,
6 committee, institution, legislative body, agency, government corporation, or other entity, instrumentality, or
7 official of the executive, legislative, or judicial branch of this state, including the board of regents and the
8 Montana university system.
9 (12) (13) (a) "Grant" means the furnishing by the federal government of assistance, whether
10 financial or otherwise, to a person or agency to support a program authorized by law.
11 (b) Grant does not include an award whose primary purpose is to procure an end product, whether
12 in the form of supplies or services. A contract resulting from an award is not a grant but a procurement contract.
13 (13) (14) "Person" means any business, individual, union, committee, club, other organization, or
14 group of individuals.
15 (14) (15) (a) "Printing" means the reproduction of an image from a printing surface generally
16 made by a contact impression that causes a transfer of ink or the reproduction of an impression by a
17 photographic process and includes graphic arts, typesetting, binding, and other operations necessary to
18 produce a finished printed product.
19 (b) Printing does not include rebinding or repair by a library or an office, department, board, or
20 commission of books, journals, pamphlets, magazines, and literary articles held as a part of its library collection.
21 (15) (16) (a) "Procurement" means acquisition with or without cost, buying, purchasing, renting,
22 leasing, or otherwise acquiring any supplies or services. The term includes all functions that pertain to the
23 obtaining of any supply or service, including description of requirements, selection and solicitation of sources,
24 preparation and award of contract, and all phases of contract administration.
25 (b) Procurement does not include the acquiring of supplies or services by gift.
26 (16) (17) "Procurement officer" means any person authorized to enter into and administer
27 contracts and make written determinations with respect to contracts. The term includes an authorized
28 representative acting within the limits of the representative's authority. ****
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1 (17) (18) "Purchasing agency" means any governmental body, other than the department, that is
2 authorized by this chapter or its implementing rules or by way of delegation from the director to enter into
3 contracts.
4 (18) (19) (a) "Services" means the furnishing of labor, time, or effort by a contractor.
5 (b) Services The term does not include employment agreements or collective bargaining
6 agreements, the provision of human services administered by the department of public health and human
7 services facility contracts, or services related to construction contracts.
8 (19) (20) "Supplies" means all property except as otherwise provided by law, including but not
9 limited to equipment, materials, printing, and commodities, and excluding land or any interest in land.
10 (20) (21) "Using agency" means any governmental body of the state that uses any supplies or
11 services procured under this chapter.
12 (21) (22) "Vendor" means a person who offers or may offer supplies or services to a public
13 agency."
14
15 Section 18-4-132, MCA, is amended to read:
16 "18-4-132. (1) This chapter applies to:
17 (a) the expenditure of public funds irrespective of their source, including federal assistance money,
18 by this state acting through a governmental body under any contract, except a contract exempted from this
19 chapter by this section or by another statute;
20 (b) a procurement of supplies or services that is at no cost to the state and from which income may
21 be derived by the vendor and to a procurement of supplies or services from which income or a more
22 advantageous business position may be derived by the state; and
23 (c) the disposal of state supplies.
24 (2) This chapter or rules adopted pursuant to this chapter do not prevent any governmental body
25 or political subdivision from complying with the terms and conditions of any grant, gift, bequest, or cooperative
26 agreement.
27 (3) This chapter does not apply to:
28 (a) either grants or contracts between the state and its political subdivisions or other governments, ****
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1 except as provided in part 4;
2 (b) construction contracts;
3 (c) expenditures of or the authorized sale or disposal of equipment purchased with money raised
4 by student activity fees designated for use by the student associations of the university system;
5 (d) contracts entered into by the Montana state lottery that have an aggregate value of less than
6 $250,000;
7 (e) contracts entered into by the state compensation insurance fund to procure insurance-related
8 services;
9 (f) (d) contracts with:
10 (i) a registered professional engineer, surveyor, real estate appraiser, or registered architect;
11 (ii) a physician, dentist, pharmacist, or other medical, dental, or health care provider;
12 (iii) an expert witness hired for use in litigation, a hearings officer hired in rulemaking and contested
13 case proceedings under the Montana Administrative Procedure Act, or an attorney as specified by executive
14 order of the governor;
15 (iv) consulting actuaries;
16 (v) (iv) a private person contracted by the student associations of the university system with money
17 raised from student activity fees designated for use by those student associations;
18 (vi) a private person contracted by the Montana state lottery;
19 (vii) (v) a private investigator licensed by any jurisdiction;
20 (viii) (vi)a claims adjuster; or
21 (ix) (vii) a court reporter appointed as an independent contractor under 3-5-601;
22 (g) (e) electrical energy purchase contracts by the university of Montana or Montana state university,
23 as defined in 20-25-201. Any savings accrued by the university of Montana or Montana state university in the
24 purchase or acquisition of energy must be retained by the board of regents of higher education for university
25 allocation and expenditure.
26 (h) (f) the purchase or commission of art for a museum or public display;
27 (i) (g) contracting under 47-1-121 of the Montana Public Defender Act, if the amount of the contract
28 does not exceed $50,000; ****
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1 (j) (h) contracting under Title 90, chapter 4, part 11; or
2 (k) (i) contracting under Title 90, chapter 14, part 1; or
3 (j) emergency procurement by the department of public health and human services related to the
4 following:
5 (i) placement of a client with a residential service provider; or
6 (ii) provision of medical services for a client.
7 (4) (a) Food products produced in Montana may be procured by either standard procurement
8 procedures or by direct purchase. Montana-produced food products may be procured by direct purchase when:
9 (i) the quality of available Montana-produced food products is substantially equivalent to the
10 quality of similar food products produced outside the state;
11 (ii) a vendor is able to supply Montana-produced food products in sufficient quantity; and
12 (iii) a bid for Montana-produced food products either does not exceed or reasonably exceeds the
13 lowest bid or price quoted for similar food products produced outside the state. A bid reasonably exceeds the
14 lowest bid or price quoted when, in the discretion of the person charged by law with the duty to purchase food
15 products for a governmental body, the higher bid is reasonable and capable of being paid out of that
16 governmental body's existing budget without any further supplemental or additional appropriation.
17 (b) The department shall adopt any rules necessary to administer the optional procurement
18 exception established in this subsection (4).
19 (5) As used in this section, the following definitions apply:
20 (a) "Food" means articles normally used by humans as food or drink, including articles used for
21 components of articles normally used by humans as food or drink.
22 (b) "Produced" means planted, cultivated, grown, harvested, raised, collected, processed, or
23 manufactured."
24
25 Section 53-21-1007, MCA, is amended to read:
26 "53-21-1007. (1) The department shall provide for public mental
27 health services for the purposes of the prevention, diagnosis, and treatment of mental illness to the extent
28 funded by the legislature. ****
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1 (2) The department may administer the provision of services for prevention, diagnosis, and
2 treatment of mental illness directly or indirectly through contract with other agencies of government, private or
3 public agencies, private professional persons, hospitals, or licensed mental health centers.
4 (3) The department is directed to encourage and create incentives for the use of funding
5 generated by local governments to provide mental health services to participate in federal cost-sharing
6 programs.
7 (4) The department shall promote the rights of persons with mental illness who are eligible for
8 services to have a choice among qualified providers of mental health services or support services that are
9 administered or funded by the department.
10 (5) The department shall develop contracts to be bid competitively under the Montana
11 Procurement Act for any service administered or funded by the department that will limit a client's choice of a
12 provider of that service in order to ensure accountability and that necessary services are delivered in all areas
13 of the state. The exception for human services facilities as provided in 18-4-123(18) 18-4-123(19) does not
14 apply."
15
16 Section 90-14-110, MCA, is amended to read:
17 "90-14-110. A contract or
18 cooperative agreement may be authorized under this part for the purposes of an exemption from the Montana
19 Procurement Act pursuant to 18-4-132(3)(k) 18-4-132(3)(i) only if:
20 (1) the contract implements a community service project consistent with the provisions of 90-14-
21 105; and
22 (2) the contract does not involve an activity prohibited under 90-14-106."
23
24 NEW SECTION. Section 5. Repealer.
25 repealed:
26 80-11-225. Committee procurement -- rulemaking.
27
28 NEW SECTION. Section 6. [This act] is effective on passage and approval. ****
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