Senate Bill No. 240
(By Senators Kessler (Acting President) and Hall,
By Request of the Executive)
[Originating in the Committee on Government Organization;
reported February 23, 2011.]
A BILL to amend and reenact §5A-3-10 of the Code of West Virginia, 1931, as amended, relating to purchasing practices; prohibiting the director from approving certain purchases; authorizing use of reverse auctions in certain circumstances; defining “reverse auction”; permitting the use of third-party vendors for reverse auctions; and providing rule-making and emergency rule-making authority to implement reverse auctions.
Be it enacted by the Legislature of West Virginia:
That §5A-3-10 of the Code of West Virginia, 1931, as amended, be amended and reenacted to read as follows:
ARTICLE 3. PURCHASING DIVISION.
§5A-3-10. Competitive bids; publication of solicitations for sealed bids; purchase of products of nonprofit workshops; employee to assist in dealings with nonprofit workshops.
(a) A purchase of and contract for commodities, printing and services shall be based, whenever possible, on competitive bids.
(b) The director shall solicit sealed bids for the purchase of commodities and printing which is estimated to exceed $25,000. No spending unit shall issue a series of requisitions or divide or plan procurements to circumvent this $25,000 threshold or otherwise avoid the use of sealed bids. Any spending unit which awards multiple contracts for the same or similar commodity or service to an individual vendor over any twelve-month period, the total value of which exceeds $25,000, shall file copies of all contracts awarded to the vendor within the twelve preceding months with the director immediately upon exceeding the $25,000 limit, along with a statement explaining how the multiple contract awards do not circumvent the $25,000 threshold. If the spending unit does not immediately report to the director, the director may suspend the purchasing authority of the spending unit until the spending unit complies with the reporting requirement of this subsection. The director may conduct a review of any spending unit to ensure compliance with this subsection. Following a review, the director shall complete a report summarizing his or her findings and forward the report to the spending unit. In addition, the director shall report to the Joint Committee on Government and Finance on January 1 and July 1 of each year the spending units which have reported under this subsection and the findings of the director. The director may not approve purchases made in violation of this section.
(c) The director may permit bids by electronic transmission to be accepted in lieu of sealed bids.
(d) Notwithstanding any other provision of law, the director may permit the use of a reverse auction to purchase supplies, material or equipment if the director determines that the use of a reverse auction would be advantageous to the state: Provided, That the director may not use reverse auctions for the procurement of services, construction services, expressions of interest, or any other professional or business service not directly related to the commodity being purchased.
(1) For purposes of this subsection, “reverse auction” means a process in which bidders compete in an open and interactive environment, including the use of electronic media. The bids are opened and made public immediately, bidders are given an opportunity to submit revised bids until the bidding process is complete and the bid is awarded to the lowest responsible bidder. (2) The director may contract with qualified, industry-recognized third-party vendors to conduct reverse auctions on behalf of the director.
(3) The director shall propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code, for the implementation of the reverse auction process and the qualification and selection of qualified, industry-recognized third-party vendors to conduct reverse auctions on behalf of the director. The director is also authorized to propose emergency rules to implement the provisions of this subsection.
(d) (e) Bids shall be solicited by public notice. The notice may be published by any advertising medium the director deems advisable. The director may also solicit sealed bids by sending requests by mail or electronic transmission to prospective vendors.
(e) (f) The director shall, without competitive bidding, purchase commodities and services produced and offered for sale by nonprofit workshops, as defined in section one, article one of this chapter, which are located in this state: Provided, That such commodities and services shall be of a fair market price and of like quality comparable to other commodities and services otherwise available as determined by the director with the advice of the committee on the purchase of commodities and services from the handicapped.
(g) To encourage contracts for commodities and services with nonprofit workshops, the director shall employ a person whose responsibilities, in addition to other duties, shall be are to identify all commodities and services available for purchase from nonprofit workshops, to evaluate the need of the state for commodities and services to coordinate the various nonprofit workshops in their production efforts and to make available to such workshops information about available opportunities within state government for purchase of commodities or services which might be produced and sold by such workshops. Funds to employ such a person shall be included annually in the budget.