HB2592 H GO AM 2-11 

Webb 3289

            The Committee on Government Organization moves to amend the bill, on page one, beginning on line nineteen, after the enacting clause, by striking out the remainder of the bill in its entirety and inserting in lieu thereof the following:

            “That §5A-3-4, §5A-3-10a, §5A-3-15 and §5A-3-60 of the Code of West Virginia, 1931, as amended, be amended and reenacted; and that said code be amended by adding thereto two new sections, designated §5A-3-14 and §5A-3-14a, all to read as follows:

ARTICLE 3. PURCHASING DIVISION.

§5A-3-4. Rules of director.

            (a) The director shall propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code to:

            (1) Authorize a spending unit to purchase specified commodities and services directly and prescribe the manner in which such purchases shall be made;

            (2) Authorize, in writing, a spending unit to purchase commodities and services in the open market for immediate delivery in emergencies, define emergencies and prescribe the manner in which such purchases shall be made and reported to the director;

            (3) Prescribe the manner in which commodities and services shall be purchased, delivered, stored and distributed;

            (4) Prescribe the time for making requisitions and estimates of commodities and services, the future period which they are to cover, the form in which they shall be submitted and the manner of their authentication;

            (5) Prescribe the manner of inspecting all deliveries of commodities, and making chemical and physical tests of samples submitted with bids and samples of deliveries to determine compliance with specifications;

            (6) Prescribe the amount and type of deposit or bond to be submitted with a bid or contract and the amount of deposit or bond to be given for the faithful performance of a contract;

            (7) Prescribe a system whereby the director shall be required, upon the payment by a vendor of an annual fee established by the director, to give notice to such vendor of all bid solicitations for commodities and services of the type with respect to which such vendor specified notice was to be given, but no such fee shall exceed the cost of giving the notice to such vendor, nor shall such fee exceed the sum of $125 per fiscal year nor shall such fee be charged to persons seeking only reimbursement from a spending unit;

            (8) Prescribe that each state contract entered into by the Purchasing Division shall contain provisions for liquidated damages, remedies or provisions for the determination of the amount or amounts which the vendor shall owe as damages, in the event of default under such contract by such vendor, as determined by the director;

            (9) Prescribe contract management procedures for all state contracts except government construction contracts including, but not limited to, those set forth in article twenty-two, chapter five of this code;

            (10) Prescribe procedures by which oversight is provided to actively monitor spending unit purchases, including, but not limited to, all technology and software commodities and services exceeding $1 million, approval of change orders and final acceptance by the spending units;

            (11) Prescribe that each state contract entered into by the Purchasing Division contain provisions for the cancellation of the contract upon thirty days’ notice to the vendor;

            (12) Prescribe procedures for selling surplus commodities to the highest bidder by means of an Internet auction site;

            (13) Provide such other matters as may be necessary to give effect to the foregoing rules and the provisions of this article; and

            (14) Prescribe procedures for encumbering purchase orders to ensure that the proper account may be encumbered before sending purchase orders to vendors.

            (15) Prescribe official forms to document division review and approval of solicitations resulting from agency requisitions; to document division review and approval of proposed vendor disqualifications; to document division review and approval of contract award recommendations from spending units; and to document review and approval of best value procurement procedures by a committee established by the director for that purpose. All forms developed pursuant to this subdivision shall require the signature and job titles of each individual reviewing or approving a purchasing procedure. The Director shall also develop corresponding forms to be completed by spending unit personnel on agency delegated procurements.

            (16) Prescribe procedures relating to change orders as set forth in section fourteen-a of this article.

            (b) The director shall propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code to prescribe qualifications to be met by any person who is to be employed in the Purchasing Division as a state buyer. The rules must provide that a person may not be employed as a state buyer unless he or she at the time of employment either is:

            (1) A graduate of an accredited college or university; or

            (2) Has at least four years’ experience in purchasing for any unit of government or for any business, commercial or industrial enterprise.

            Persons serving as state buyers are subject to the provisions of article six, chapter twenty-nine of this code.

§5A-3-10a. Prohibition for awarding contracts to vendors which owe a debt to the state or its political subdivisions.

            (a) Unless the context clearly requires a different meaning, for the purposes of this section, the terms:

            (1) "Debt" means any assessment, premium, penalty, fine, tax or other amount of money owed to the state or any of its political subdivisions because of a judgment, fine, permit violation, license assessment, amounts owed to the Workers' Compensation Funds as defined in article two-c, chapter twenty-three of this code, penalty or other assessment or surcharge presently delinquent or due and required to be paid to the state or any of its political subdivisions, including any interest or additional penalties accrued thereon.

            (2) "Debtor" means any individual, corporation, partnership, association, limited liability company or any other form or business association owing a debt to the state or any of its political subdivisions, and includes any person or entity that is in employer default.

            (3) "Employer default" means having an outstanding balance or liability to the old fund or to the uninsured employers’ fund or being in policy default, as defined in section two, article two-c, chapter twenty-three, of this code, failure to maintain mandatory workers’ compensation coverage, or failure to fully meet its obligations as a workers’ compensation self-insured employer. An employer is not in employer default if it has entered into a repayment agreement with the Insurance Commissioner and remains in compliance with the obligations under the repayment agreement.

            (4) "Political subdivision" means any county commission; municipality; county board of education; any instrumentality established by a county or municipality; any separate corporation or instrumentality established by one or more counties or municipalities, as permitted by law; or any public body charged by law with the performance of a government function and whose jurisdiction is coextensive with one or more counties or municipalities.

            (5) "Related party" means a party, whether an individual, corporation, partnership, association, limited liability company or any other form or business association or other entity whatsoever, related to any vendor by blood, marriage, ownership or contract through which the party has a relationship of ownership or other interest with the vendor so that the party will actually or by effect receive or control a portion of the benefit, profit or other consideration from performance of a vendor contract with the party receiving an amount that meets or exceeds five percent of the total contract amount.

            (b) No contract or renewal of any contract may be awarded by the state or any of its political subdivisions to any vendor or prospective vendor when the vendor or prospective vendor or a related party to the vendor or prospective vendor is a debtor and:

            (1) The debt owed is an amount greater than $1,000 in the aggregate; or

            (2) The debtor is in employer default.

            (c) The prohibition of this section does not apply where a vendor has contested any tax administered pursuant to chapter eleven of this code, amount owed to the Workers' Compensation Funds as defined in article two-c, chapter twenty-three of this code, permit fee or environmental fee or assessment and the matter has not become final or where the vendor has entered into a payment plan or agreement and the vendor is not in default of any of the provisions of such plan or agreement.

            (d) All bids, contract proposals or contracts with the state or any of its political subdivisions submitted or approved under the provisions of this code shall include an affidavit that the vendor, prospective vendor or a related party to the vendor or prospective vendor is not in employer default and does not owe any debt in an amount in excess of $1,000 or, if a debt is owed, that the provisions of subsection (c) of this section apply.

            (e) Vendors must obtain a Statement of Good Standing from the state Tax Department and provide a copy to the Purchasing Division prior to being awarded a contract or receiving a contract renewal.

§5A-3-14. Ongoing review of spending unit activity.

            (a) Short title -- This section, section fourteen-a of this article and the amendments made to other sections of this article by this act, shall collectively be known and may be cited as the "Purchasing Compliance and Improvement Act."

            (b) The director shall ensure that the division’s inspection program includes review procedures, including review through electronic means beginning no later than July 1, 2016, designed to identify the following activities:

            (1) Knowingly structuring contracts or a series of contracts in order to avoid competitive bidding requirements of this article, in violation of section thirty-one of this article.

            (2) Inappropriate use of exemptions from purchasing requirements, which includes, but is not limited to:

            (A) Asserting an exemption, previously issued by the director for a contract or type of contract that was determined to be not possible to submit for competitive bidding, in order to avoid complying with the requirements of this article when a change in circumstances has made it possible to submit a contract or type of contract for competitive bidding.

            (B) Asserting an exemption, previously issued by the director for a particular contract or type of contract that was determined to be not possible to submit for competitive bidding, to avoid complying with the requirements of this article when entering into a different contract or type of contract from the one contemplated in the original exemption.

            (C)Asserting an exemption to otherwise avoid complying with the requirements of this section in relation to a contract that is possible to submit for competitive bid.

            (3) Contracts violating any provision of this code or the rules promulgated by the director.

            (c) If the director finds that a spending unit is engaging an activity described in subsection (b) of this section, the director shall notify the spending unit of the prohibited activity and, if necessary, issue a notice to cease and desist pursuant to subdivision (11), section three of this article.

§5A-3-14a. Approval of change orders. 

            (a) "Change order" means any modification to an existing contract, agreed upon in writing by the spending unit and the vendor, which modifies the legal rights of either or both parties to the contract.

            (b) A spending unit shall not authorize a vendor to provide commodities or services that the spending unit anticipates will be added to a contract through a change order until such time as the director and the Attorney General's office have provided final approval as required by subdivision nine, section three of this article and until such time as the funds are encumbered. The Purchasing Director may authorize the vendor to provide commodities or services pursuant to a change order prior to final approval in extenuating circumstances. Provided that, the extenuating circumstances are documented in writing and signed by the spending unit and the vendor prior to submitting the request to the Purchasing Director or his or her designee for approval.

            (c) In the event that a vendor provides commodities or services in more than five instances without either a change order processed to final approval by the Purchasing Division and the Attorney General’s office or extenuating circumstances approval as provided in subsection (b) of this section, the Purchasing Director may debar the vendor for a period not to exceed two years.

§5A-3-15. Emergency purchases in open market.

            The director may authorize, in writing, a state spending unit to purchase in the open market, without filing requisition or estimate, specific commodities and services for immediate delivery to meet bona fide emergencies arising from unforeseen causes, including delays by contractors, delays in transportation and unanticipated volume of work. A report of any such purchase, together with a record of the competitive bids upon which it was based, shall be submitted at once to the director by the head of the state spending unit concerned, together with a full account of the circumstances of the emergency: Provided, That the director may waive the need for the record of competitive bids. Such report shall be entered on a record and shall be open to public inspection.

§5A-3-60. Annual purchasing training.

            (a) For the purposes of this section "purchasing staff" means any employee of a spending unit who conducts purchasing as a primary job function, including any employee of an executive department spending unit exempt from article three, chapter five-a of this code.

            (a) (b) All executive department secretaries, commissioners, deputy commissioners, assistant commissioners, directors, deputy directors, assistant directors, department heads, deputy department heads, and assistant department heads are hereby required to take two hours of training on purchasing procedures and purchasing cards annually.

            (c) All purchasing staff are hereby required to take ten hours of training on purchasing procedures and purchasing cards annually.

            (b) (d) The Director of the Purchasing Division and the Auditor shall offer the two-hour training required by this section at least two times per year and shall develop its substance in accordance with the requirements of this article and other relevant provisions of this code. The Director of the Purchasing Division and the Auditor shall also offer sufficient training sessions throughout the year to allow purchasing staff to accumulate the ten hours of required training. The training shall be recorded by audio and visual means and shall be made available to the individuals listed in subsection (a) (b) and (c) of this section in the event they are unable to attend the training in person.

            (c) (e) All individuals listed in subsections (a) (b) and (c) of this section shall certify, in writing and on a form developed by the Director of the Purchasing Division, the date, time, location and manner in which they took the training. Completed forms shall be returned to the director and maintained in his or her office.

            (f) All spending units shall report to the director annually the names of each purchasing staff member employed by the spending unit and the names of all purchasing-related training sessions attended by each purchasing staff member.”