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STATE OF OKLAHOMA
1st Session of the 59th Legislature (2023)
COMMITTEE SUBSTITUTE
FOR ENGROSSED
HOUSE BILL 1774 By: Williams and Wolfley of the
House
and
Bullard of the Senate
COMMITTEE SUBSTITUTE
An Act relating to the Oklahoma Central Purchasing
Act; amending 74 O.S. 2021, Section 85. 7, as amended
by Section 1, Chapter 188, O.S.L. 2022 (74 O.S. Supp.
2022, Section 85.7), which relates to acquisition
initiation; adding exemption for certain contracts
from competitive bidding requirements; amending 74
O.S. 2021, Section 85.12 , which relates to excluded
acquisitions of the Oklahoma Central P urchasing Act;
authorizing the Oklahoma Tourism and Recreation
Department to utilize certain programs associated
with tourism promotions; requiring the State
Purchasing Director to review and a udit all
exceptions; prohibiting certain actions; updating
statutory references; updating statutory language;
and providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 74 O.S. 20 21, Section 85.7, as
amended by Section 1, Chapter 188, O.S.L. 2022 (74 O.S. Supp. 2022,
Section 85.7), is amended to read as follows:
Section 85.7. A. 1. Except as otherwise provided by the
Oklahoma Central Purchasing Act, or associated rules:
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a. every state agency shall initiate all acquisitions by
the submission of a requisition to t he Purchasing
Division, and
b. no state agency shall make an acquisition for an
amount exceeding Fifty Thousand Dollars ($50,000.00)
or the limit determined by the State P urchasing
Director pursuant to rules authorized by Section 85.5
of this title, not to exceed Two Hundred Fifty
Thousand Dollars ($250,000.00), without submission of
a requisition to the Purchasing Division for issuance
of a solicitation for the acquisition on behalf of the
agency. Any exemption from competitive bid
requirements of the Okl ahoma Central Purchasing Act
further exempts the acquisition from requisition
requirements of the act.
2. The State Purchasing Director may request additional
information necessary to adequately revi ew a requisition to ensure
compliance with this act the Oklahoma Central Purchasing Act and
associated rules. If the State Purchasing Di rector determines that
an acquisition is not necessary, excessive or not justified, the
State Purchasing Director shall deny t he requisition.
3. The provisions of this act the Oklahoma Central Purchasing
Act shall not preclude a state agency from :
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a. accepting gifts or donations in any manner authorized
by law, or
b. making an acquisition for itself without submitting a
requisition under this section when authoriz ed in
writing by the State Pu rchasing Director.
4. Any acquisition a state agency ma kes shall be made pursuant
to this act the Oklahoma Central Purchasi ng Act and associated
rules. No agency shall use s plit purchasing for the purpose of
evading the requirement of competitive bidding or oth er requirement
of this act the Oklahoma Central Purchasing Act or associated rules.
Violation of this provision shal l be cause for discipline of a state
employee up to and including termination.
5. The State Purchasing Director may waive or increase the
limit authorized for a state agency acquisition made pursuant to its
own competitive proc edures. To perfect an other wise valid
acquisition inadvertently exceeding th e limit due to administrative
error by a state agency or unforeseeable circumstances, the st ate
agency shall request a limited waiver or increase upon the discovery
of the error or circumstance to the State Purchasing Director. The
State Purchasing Direct or shall report requests for waivers o r
increases, stating the amount and whether the reques t was granted or
denied, upon request by the Governor, Presiden t Pro Tempore of the
Senate or Speaker of the House of Representatives.
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6. Competitive bidding requi rements of this section shall not
be required for the following:
a. contracts for master cus todian banks or trust
companies, investment managers, investmen t
consultants, and actua ries for the state retiremen t
systems, and Oklahoma Employees Insurance and B enefits
Board, pension fund management consultants of the
Oklahoma State Pension Commission and the
Commissioners of the Land Office, examiners, experts,
or consultants for the Insurance Department whose job
duties are tied to Market Conduct Exams, Financi al
Exams, and Insurance Business Transfers, financial
institutions to act as depositories an d managers of
the Oklahoma College Savings Plan accounts and other
professional service s as defined in Section 803 of
Title 18 of the Oklahoma Statutes. W hen requested by
the Oklahoma Employees Insuran ce and Benefits Board or
the governing board of a stat e retirement system
authorized to hire investment managers, the Purchasing
Division shall assist in the process of selecting
investment managers,
b. a state agency making such an acquisition shall notif y
the State Purchasing Director within fifteen (15) da ys
following completion of the acquisition. A list of
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the exempt contracts shall be pr ovided, upon request,
to a member of the Appropriations and Budget C ommittee
of the House of Representatives or App ropriations
Committee of the Senate,
c. purchases of postage by state agencies made pursuant
to Sections 90.1 through 90.4 of this title,
d. a sole source acquisition ma de in compliance with
Section 85.44D.1 of this title,
e. an acquisition for des ign, development, communication
or implementation of the state employees flexible
benefits plan; provided, procedures used for the
acquisition are consistent with competitive bi d
requirements of this act the Oklahoma Central
Purchasing Act and associated rules,
f. any acquisition of a servic e which the Office of
Management and Enterprise Services has a pproved as
qualifying for a fixe d and uniform rate, subject to
the following:
(1) the Purchasing Division shall establi sh criteria
and guidelines for those services which may
qualify for a fixed and uniform rate,
(2) fixed and uniform rate contracts author ized by
this subsection shall be limited to contracts for
those services furnis hed to persons directly
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benefiting from such services and shall not be
used by a state agency to employ consultants or
to make other acquisitions,
(3) any state agency desiring to have a service
qualified for a fixed and uniform rate shall make
a request for service qualification to the State
Purchasing Director and submit documentation to
support the request. The Sta te Purchasing
Director shall approve or deny the request. If
approved, the state agency shall establish a
fixed and uniform rate for the ser vice. No
contracts shall be entered int o by the state
agency until the rate has been approved by the
state agency in a public hearing. The proposed
rate shall be clearly and s eparately identified
in the agenda of the state agency for the hearing
and shall be openly and separately discussed
during such hearing. The state agency shall
notify the State Purchasing Direc tor of its
pending consideration of the proposed rate at
least thirty (30) days before the sta te agency is
to meet on the proposed rate and d eliver a copy
of the agenda items concer ning the proposed rate
with supporting documentation. The State
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Purchasing Director shall communicate any
observation, reservation, crit icism or
recommendation to the a gency, either in person at
the time of the hear ing or in writing delivered
to the state agency before or at the time of the
hearing. The State Purchasing Directo r shall
specifically note in the written communications
whether the Director has determined th e rate to
be excessive. Any written communicat ion
presented in the absence of the Stat e Purchasing
Director shall be presented orally during the
public hearing. Whether made in person or in
writing, any comment made by the State Purchasing
Director shall be made a part of the minutes of
the hearing in full,
(4) within two (2) weeks after t he convening of the
Legislature, the administrative officer of the
state agency shall furnish to the Speaker of the
House of Representati ves, the President Pro
Tempore of the Senate and to any member of the
House or Senate, if requested by the member, a
complete list of all of the types of services
paid for by uniform fixed rates , the amount of
the rate last approved by the agency for the
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service and the number of contrac ts then in
existence for each type of service. Any rate
which has been determined to b e excessive by the
State Purchasing Director shall be specifically
identified in the list by the state agency, and
(5) at any time, the State Purchasing Director may
review, suspend or terminate a contract entered
into pursuant to the provisions of this pa ragraph
if the Director determines the contract is not
necessary, is excess ive or is not justified,
g. an acquisition for a client of the State Department of
Rehabilitation Services; provided, the agency develops
and maintains standards for such an acquisi tion. The
agency may elect to utilize the Purchasing Division
for an acquisition. The standards shall foster
economy, provide a short r esponse time, include
appropriate safeguards, require written records,
ensure appropriate competition for economical an d
efficient purchasing and shall be approved by the
State Purchasing Direct or,
h. structured settlement agreements entered into by the
Attorney General’s office in order to settle any
lawsuit involving the state, the Legislature, any
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state agency or any em ployee or official of the state
if:
(1) prior to entering into any contract for the
services of an entity to administer a structured
settlement agreement, the Attorney G eneral
receives proposals from at least three e ntities
engaged in providing such servic es, and
(2) the selection of a particular entity is made on
the basis of the response to the request which is
the most economical and pro vides the most
competent service which furthers the best
interests of the state ,
i. an acquisition by a state agency pu rsuant to a
contract the State Purchasing Director enters into on
behalf of a state agency or awards and designates for
use by state agencies,
j. an acquisition by the C ommittee for Sustaining
Oklahoma’s Energy Resources pursuant to a contract
with a local supplier for the purpose of holding a
special event or an exhibition throu ghout the state,
and
k. contracts for the study, analysis, and planning, as
reasonably necessary, to aid in determining the
feasibility of leasing, selling, or pri vately managing
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or developing the property or fac ilities under control
of the Oklahoma Tourism and Recreation Commission.
The Commission shall be exempt from the competitive
bidding requirements of the Oklahoma Central
Purchasing Act for the purpose of soliciting ,
negotiating, and effectuating such a contract or
contracts; provided, that the State Purchasing
Director shall review and audit all uses of the
exemptions provided in this subparagraph.
7. Notwithstanding any other provisio n of law, an acquisition
may be exempted from requirements of this section by the State
Purchasing Director when in the State Purchasing Director’s
discretion unusual, time-sensitive or unique circumst ances exist
which make such exemption in the best and i mmediate interest of the
state. As used in this subsection, “State Purchasing Director ”
shall not mean a designee. Any such acquisitions shall be described
in detail and publicly posted as a data fee d. The description shall
include the name of the suppl ier, cost of the acquisition, reason
for exemption and, as applicable, detailed comparison of the
acquisition with comparable items, any identified cost savings
resulting from the acquisition and a des cription of benefits to the
state. The State Purchasin g Director shall take no action under t he
provisions of this subsection prior to such public posting.
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B. Competitively bid ac quisitions shall be awarded to the
lowest and best, or best value, bidder o r bidders.
C. Bids for an amount requiring submission of requisitions to
the Purchasing Divis ion shall be evaluated by the Purchasing
Division and the state agency receiving the ac quisition. At a
minimum, cost and technical expertise shall be considered in
determining the lowest and best, or best value, bid. Further, the
state agency shall prese nt its evaluation and recommendation to the
State Purchasing Director. A documented ev aluation report
containing the evaluations of the Purchasing Division or th e state
agency shall be completed prior to the contract award and such
report shall be a matte r of public record.
D. Except as otherwise specifically provided by law, the
acquisition of food items or food products by a state agency from a
public trust created pursuant to Sections 176 through 180.56 of
Title 60 of the Oklahoma Statutes shall comply with competitive
bidding requirements of this section.
E. Cooperative contracts shall not be utilized unless the
purchasing cooperative and its affiliated suppl iers have complied
with competitive bid requirements of this act the Oklahoma Central
Purchasing Act and associated rules.
F. Notwithstanding any provision of this act the Oklahoma
Central Purchasing Act, in all cases where federal granted funds are
involved, the federal laws, rules and regulations thereto shall
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govern to the extent necessary to inure to the benefit of such funds
to this state.
G. A court order requi ring an acquisition by a state agency,
whether or not such state agency is subject to this act the Oklahoma
Central Purchasing Act, shall not invalidate competitive bidding
procedures required by th is section if such court order does not
specify a specific supplier. Any such acquisition sha ll comply with
competitive bid procedures.
SECTION 2. AMENDATORY 74 O.S. 2021, Section 85.12, is
amended to read as follows:
Section 85.12. A. The provisions of this section shall not be
construed to affect any law relating to fiscal or ac counting
procedure except as they may be directly in conflict herewith ; and
all claims, warrants, and bonds shall be examined, inspected, and
approved as now provided by law.
B. Except as otherwise provided by this section, the
acquisitions specified in t his subsection shall be made in
compliance with Section 85.39 of this title and purchasing card
program requirements but are not subject to other provisions of t he
Oklahoma Central Purchasing Ac t:
1. Food and other products produce d by state institutions and
agencies;
2. The printing or duplication of publications or forms of
whatsoever kind or chara cter by state agencies if the work is
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performed upon their own equipment by their own employees. Pursuant
to this paragraph, the stat e agency may only use eq uipment owned or
leased by the agency and may only utilize that equipm ent for
printing services re quired by the agency in performing duties
imposed upon the agen cy or functions authorized to be performed by
the agency. Any use of t he equipment by the agen cy pursuant to an
agreement or contract with any other entity resultin g in delivery of
intermediate or finished products to the entity purchasing or using
the products shall be subject to the provisions of this act the
Oklahoma Central Purchasing Act and associated rules;
3. Department of Transportation and Transportation C ommission
contractual services or right-of-way acquisitions, contracts awarded
pursuant to bids let by the Transportation Commi ssion for the
maintenance or construction of streets, roads, highways, bridges,
underpasses or any other transportation facilitie s under the control
of the Department of Transportation, equipment or material
acquisitions accruing to the Department of Trans portation required
in Federal-Aid contracts and acquisitions for public -service-type
announcements initiated by the Department of Transportation, but not
acquisitions for advertising, public relations or employment
services;
4. Utility services regulated by a state or federal regulatory
commission, municipal ordinance or an Indian Tribal Council;
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5. Acquisitions by the University Hospitals Authority. The
Authority shall develop standards for the acquisition of products
and services and may elect to utili ze the Purchasing Division. The
standards shall foster economy and sho rt response time and sha ll
include appropriate safeguards and record-keeping requirements to
ensure appropriate competition and economical and efficient
purchasing;
6. Custom harvestin g by the Department of Corrections for the
Department or its institutio ns;
7. Subject to prior approval of the State Purchasing Director,
acquisitions from private prison suppliers which are subject to the
contracting procedures of Section 561 of Title 57 of the Oklahoma
Statutes;
8. Acquisitions by the Oklahoma Municipal P ower Authority;
9. Acquisitions by the Grand River Dam Au thority;
10. Acquisitions by rural water, sewer, gas or solid waste
management districts created pursuant to the Rural Water, Sewer, Gas
and Solid Waste Management Districts Act;
11. Acquisitions by the Oklahoma Ordnance Works Authority, the
Northeast Oklahoma Public Facilities Aut hority or the Midwestern
Oklahoma Development Authority;
12. Expenditure of monies appropriated to the State Board of
Education for Local and State Supported Financial S upport local and
state-supported financial support of Public Schools public schools,
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except monies allocated therefrom for the Administrative and Support
Functions of the State Department of Education;
13. Expenditure of monies appropriated to the State Department
of Rehabilitation Services for educational progr ams or educational
materials for the Oklahoma School for the Blind and the Oklahoma
School for the Deaf;
14. Contracts entered into by the Oklahoma Department of Career
and Technology Education for the development, revision or updating
of vocational curriculum materials, and cont racts entered into by
the Oklahoma Department of Career and Technology Edu cation for
training and supportive services that address the needs of new or
expanding industries;
15. Contracts entered into by the Oklahoma Center for the
Advancement of Science a nd Technology for professional services;
16. Contracts entered into by th e Oklahoma Department of
Commerce pursuant to the provisions of Section 5066.4 of this title;
17. Acquisitions made by the Oklahoma Historical Society from
monies used to administer the White Hair Memorial;
18. Purchases of pharmaceuticals available thro ugh a multistate
or multigovernmental contract if such pharmaceuticals are or have
been on state contract within the last fiscal year, and the terms of
such contract are more favorab le to the state or agency than the
terms of a state contract for the same products, as determined by
the State Purchasing Director. The state entity designated by law,
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as specified in Section 1010.3 of Title 56 of the Oklahoma Sta tutes,
shall participate in the purchase of pharmaceuticals available
through such contracts;
19. Contracts for managed health care services entered into by
the state entity designated by law or the Department of Human
Services, as specified in paragraph 1 of subsection A of Sect ion
1010.3 of Title 56 of the Oklahoma Statutes;
20. Acquisitions by a st ate agency through a General Services
Administration contract or other federal contract if the
acquisitions are not on current statewide contract or the term s of
the federal contract are more favorable to the agency than the terms
of a statewide contract f or the same products;
21. Acquisitions of clothing for clients of the Department of
Human Services and acquisitions of food for group homes operated by
the Department of Human Servi ces;
22. Acquisitions by the Oklahoma Energy Resources Board;
23. Acquisitions of clothing for juveniles in the custody of
the Office of Juvenile Affairs and a cquisitions of food for group
homes operated by the Office of Juvenile Affairs;
24. State contracts for flexible benefits plans pursuant to the
Oklahoma State Employees Benefits Act, Section 1361 et seq. of this
title;
25. Acquisitions by the Oklahoma Department of Securities to
investigate, initiate, or pursue administrat ive, civil or criminal
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proceedings involving potential violations of the acts under the
Department’s jurisdiction and acquisitions by the Oklahoma
Department of Securities for its investor education progr am;
26. Acquisitions for resale in and through cant eens operated
pursuant to Section 537 of Title 57 of the Oklahoma Statutes and
canteens established at an institution or facility operated by the
Office of Juvenile Affairs;
27. Acquisitions by the Oklah oma Boll Weevil Eradication
Organization for employm ent and personnel services, and for
acquiring sprayers, blowers, traps and attractants related to the
eradication of boll weevils in this state or as part of a national
or regional boll weevil eradication program;
28. Contracts entered into by the Oklahom a Indigent Defense
System for expert services pursuant to the provisions of subsection
D of Section 1355.4 of Title 2 2 of the Oklahoma Statutes;
29. Acquisitions by the Oklahoma Correctional Industries a nd
the Agri-Services programs of the Department of C orrections of raw
materials, component parts and other products, any equipment
excluding vehicles, and any services e xcluding computer consultant
services used to produce goods or services for resale and for the
production of agricultural products;
30. Contracts entered into by the Department of Human Services
for provision of supported living services to members of the
plaintiff class in Homeward Bound, Inc., et al. v. The Hissom
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Memorial Center, et al., Case Number 85-C-437-E, United States
District Court for the Northern District of Oklahoma;
31. Contracts negotiated by the Office of Juvenile Affairs with
designated Youth Services Agencies and the Oklahoma Association of
Youth Services, or another Okla homa nonprofit corporation whose
membership consists solely of Youth Services Agencies and of whom at
least a majority of Youth Services Agencies are members, pursuant t o
the provisions of Section 2 -7-306 of Title 10A of the Oklahoma
Statutes and contracts entered into by the Department of Human
Services pursuant to Section 1-9-110 of Title 10A of the Oklahoma
Statutes with designated Youth Services Agencies;
32. Contracts for annuities for structured settlements provided
for in Section 158 of Title 51 of the Oklahoma Statutes;
33. Subject to subsection E of this section, purchases made
from funds received by local offices administered by the Department
of Human Services or administered by the Office of Juvenile Affairs
for fund-raising activities and dona tions for the benefit of clients
and potential clients at the local offices where such purchases may
not otherwise be paid for from appropriated funds;
34. Acquisitions by the Oklahoma Historical Society for
restoration of historical sites and museums alt hough the agency may
elect to utilize the Purchasing Division for an acquisition with
supplier and bid selection being the prerogative of the agency,
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based on the supplier’s documented qualifications and experience;
and
35. Acquisitions of clothing and fo od for patients in the care
of the J.D. McCarty Cent er for Children with Developmental
Disabilities; and
36. Promotions of state-owned, -leased, or -operated facilities
by the Oklahoma Tourism and Recreation Commission, through the
Oklahoma Tourism and Recreation Department. The Department may
utilize the provision of complimentary rooms, package-rate plans,
group rates, guest incentive sales programs, entertainment of
prospective guests, emp loyee information programs, or golf
promotional programs. Any other sales and promotion programs
considered acceptable in the hospitality industry, travel industry,
or regional magazine industry shall be approved as necessary
advertising and promotion expenses. The Department may enter into
partnerships for promotional programs and projects with a private
person, firm, corporation, organization, or association. The
Department may enter into contracts or agree ments under terms to be
mutually agreed upon to carry out the promotional programs and
projects, excluding the provisions of Section 2221 of Title 74 of
the Oklahoma Statutes. The contracts or agreements may be
negotiated and shall be exempt from the Public Competitive Bidding
Act of 1974. All contracts or ag reements entered into as
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partnerships for promotional projects or programs by the Department
shall be approved by the Commission.
C. Pursuant to the terms of a contract the State Purchasing
Director enters into or awards, a state agency, common school,
municipality, rural fire protection district, county offic er or any
program contract, purchase, acquisition or expenditure that is not
subject to the provisions of the Oklahoma Central Purchasing Act,
may, unless acting pursuant to a contract with the state that
specifies otherwise, make use of statewide contract s and the
services of the Purchasing Division and the State Purchasing
Director. Any political subdivision or rural fire protection
district may designate the State Purchasing Director as its agent
for any acquisition from a statewide contract or otherwis e available
to the state.
D. The State Purchasing Director may make periodic audits of
shall review and audit all the purchasing procedures of acquisit ions
listed in subsection B of this section to ensure that the procedures
are being followed. Nothing in this section shall be construed t o
authorize bid splitting as prohibited by t he Oklahoma Central
Purchasing Act.
E. With respect to the Department of Human Services or the
Office of Juvenile Affairs, as applicable, monies received by
fundraising activities or donations from the local office , vending
operations administered by empl oyees of the agency and all other
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nonrestricted cash and cash -equivalent items received by employees
of the agency shall be deposited in the agency special account
established for this purpose. The deposits shall b e made at local
banking institutions appr oved by the State Treasurer.
F. With respect to the Oklahoma Tourism and Recreation
Department, no exemption provided in this section shall be construed
for the use of leasing or contracting for state -owned restaurants in
Oklahoma state parks, and the Department shall not be required to
purchase furniture, fixtures, and equipm ent, and soft goods
associated with decor of the state parks, lodges, golf courses, and
tourism information centers from Oklahoma prisons or reformatories .
SECTION 3. This act shall become effective November 1, 2023.
59-1-2055 MR 4/3/2023 12:17:30 PM