Creating Business Policy in Olympia

1. Creating Business Policy in Olympia Frank Lemos, President Presented with Servando Patlán May 22, 2014

2. Business Policy Education • Business in Washington State is governed laws, rules, policies, processes, and systems administered by multiple agencies and influenced by many dimensions of government process.

3. Legislative Government Consolidation • 2011 SB 5931 Combines the purchasing and contracting functions of the departments of General Administration, Printing, Personnel, Office of Financial Management, and Information Services into the Department of Enterprise Services • 2012 2SHB 2452 Procurement Reform combines the purchase authorities for GA, DIS, and OFM purchase authorities: RCWs 43.19, 43.105, and 39.29 respectively into one purchase authority under the Department of Enterprise Services RCW 39.26

4. Past Legislation on Small Business • 2009 SSB 5723 Defines WA Small Business & requests new policies to increase purchases from WA Small Businesses for GA, DIS, PRT, and OFM purchase authorities: RCWs 43.19, 43.105, 43.19.736, and 39.29 respectively • 2010 ESB 5041 Defines Certified Veteran Owned Businesses • 2011 HB 1770 Redefines WA Small Business (removes owner domiciled requirement) requires a web based system by Dec 31, 2013

5. Commitment To Small Business RCW 39.26 Section 1 - Intent of the procurement reform legislation, concludes with the following sentence: “In addition, the legislature intends that the state develop procurement policies, procedures, and materials that encourage and facilitate state agency purchase of goods and services from Washington small businesses.”

6. DES responsibility for procurement of architectural & Engineering Services RCW 39.80.040 Procurement of architectural and engineering services — Submission of statement of qualifications and performance data — Participation by minority and women-owned firms and veteran-owned firms.

7. Procurement with Minority Businesses RCW 39.26.090 Director's duties and responsibilities — Rules. The director shall: (1) Establish overall state policies, standards, and procedures regarding the procurement of goods and services by all state agencies; (6) Develop procurement policies and procedures, such as unbundled contracting and subcontracting, that encourage and facilitate the purchase of goods and services from Washington small businesses, microbusinesses, and minibusinesses, and minority and women-owned businesses to the maximum extent practicable and consistent with international trade agreement commitments;

8. Agency Procurement Authority Impacts RCW 39.26 Procurement Law Addresses Many Vendor Concerns, including: • Agency success purchasing from Washington Small Businesses • Debarment for vendor non-performance • Notice to vendors of contracts, contract awards, and inspection of sole source determinations prior to contract • Paperless purchasing & contracting

9. Agency Procurement Authority Impacts • An agency procurement and contracting risk assessment is being considered as a basis for the level of purchasing and contracting authority delegated to specific state agencies • Given the strong legislative intent for procurement reform to facilitate business with Washington Small Businesses, agency success in contracting and purchasing with Washington Small Business may become an important component of the risk assessment

10. Small Business Barrier Consideration • Number of years in business requirements biased against start-up firms. • Firm size requirements biased against sole proprietorships. • Number of years of state experience requirements biased against firms with federal and private experience sufficient to meet state needs. • Excess insurance & bond requirements for the project risk, e.g. a $3M umbrella policy will cost $6,000 a year, a $1M bond can cost $50,000.

11. Small Business Definitions • RCW 39.26.006 codifies the 2011 HB 1770 definition of a Washington Small Business and includes definitions for 2 additional types of small business classifications: • Mini-Business • Micro-Business

12. Washington Electronic Business Solution • WEBS provides vendors the qualifying criteria and allows vendors to self identify as a small business • http://www.ga.wa.gov/WeBS/index.html • WEBS will be updated with new qualifying criteria for mini and micro-businesses and vendors will be notified to verify and adjust their status in WEBS as a self identified small, mini, or micro business

13. Washington State Minority Commissions • Commission on African American Affairs • http://www.caa.wa.gov/ • Commission on Asian Pacific American Affairs • http://www.capaa.wa.gov/ • Commission on Hispanic Affairs • http://www.cha.wa.gov/________________________________________________ • Washington Minority Business Advisory Council • Frank Lemos (206) 713-9532 • flemos@mbac-wa.org

14. Washington Minority Business Advisory Council • One place for government policy makers to direct inquiries for input from the minority business community and to supply participants for work on policy making committees.

15. www.mbac-wa.org MISSION The Mission of the Washington Minority Business Advisory Council (MBAC) is to Inform, Engage, and Empower Minority Business Enterprises (MBE’s) through education and awareness to achieve economic equity. VISION The Vision of the Washington Minority Business Advisory Council (MBAC) is to increase state-wide minority business opportunity, growth, and influence that ensure fair and equitable public-private procurement practices and policy reform.

16. Business Policy Input • Bring issues from the business communities that represent minorities and other overlapping interest groups such as Washington Veteran Owned Businesses and Washington Small, Mini, and Micro businesses.

17. WA Minority Business Policy Agenda Framework Could Look Like This: Policy Agenda Benefits: • Ensures that WA Minority business policy is clearly communicated to WA Legislators • Makes it easier to identify what policies need more support • Guides policy planning WA Minority Businesses Policy Results can be achieved …so that… Ultimate Intent WA Minority Business policy can be prepared Legislation with WA Minority Businesses …so that… Policy Initiatives can be communicated Legislative Engagement …so that… Prioritize a WA Minority Business Policy Agenda Policy Summit Degree of Control or Influence Policy [Pre]Summit

18. WEBS Statistics Nov 9, 2011 Oct 5, 2012  Mar 21, 2013Oct 3, 2013 • 254 345 412  477 WA Certified Veteran Owned Businesses • 2,075  3,085 3,727  4,263 WA in-state Small Businesses • 632 616 648  669 WA Certified Woman Owned Businesses • 460 436 456  483 WA Certified Minority Owned Businesses • 242 230  243  256 WA Certified Woman & Minority Owned Businesses • 23,210  23,215 25,715  28,220 WEBS Registered Vendors • 1.1%  1.5% 1.6%  1.7%Veteran, • 8.9%  13.2% 14.5%  15.1%in-state small business, • 2.7%  2.7% 2.5%  2.4% Woman, • 2%  1.9% 1.8%  1.7% Minority, • 1%  0.99% 0.9% 0.9% Woman & Minority

19. WEBS Statistics October 3, 2013

20. DES Capital Projects Advisory BoardMembership RCW 39.10.220 • RCW 39.10.220 • Board — Membership — Vacancies. • (1) The board is created in the department of enterprise services to provide an evaluation of public capital projects construction processes, including the impact of contracting methods on project outcomes, and to advise the legislature on policies related to public works delivery methods.

21. DES Hosted Capital Projects Advisory BoardMembership RCW 39.10.220 (2) Members of the board are appointed as follows: (a) Two representatives from construction general contracting; one representative from the architectural profession; one representative from the engineering profession; two representatives from construction specialty subcontracting; two representatives from construction trades labor organizations; one representative from the office of minority and women's business enterprises; one representative from a higher education institution; one representative from the department of enterprise services; one individual representing Washington cities; two representatives from private industry; and one representative of a domestic insurer authorized to write surety bonds for contractors in Washington state, each appointed by the governor. All appointed members must be knowledgeable about public works contracting procedures. If a vacancy occurs, the governor shall fill the vacancy for the unexpired term;

22. DES Hosted Capital Projects Advisory BoardMembership RCW 39.10.220 (b) One member representing counties, selected by the Washington state association of counties; (c) One member representing public ports, selected by the Washington public ports association; (d) One member representing public hospital districts, selected by the association of Washington public hospital districts; (e) One member representing school districts, selected by the Washington state school directors' association; and (f) Two members of the house of representatives, one from each major caucus, appointed by the speaker of the house of representatives, and two members of the senate, one from each major caucus, appointed by the president of the senate. Legislative members are nonvoting. (3) Members selected under subsection (2)(a) of this section shall serve for terms of four years, with the terms expiring on June 30th on the fourth year of the term. (4) The board chair is selected from among the appointed members by the majority vote of the voting members.

23. Executive Order 12-01 • EXECUTIVE ORDER 12-01 Regulatory Reform and Assistance to help Small Businesses succeed and grow. • Expand the small business liaison program to include the Department of Enterprise Services. • Servando Patlan named as DES Small Business Liaison.

24. Small Business Guide • The Department of Enterprise Services and the Commission on Asian Pacific American Affairs together initiated a pilot project to translate the on-line Washington Small Business Guide into Mandarin Chinese, Korean, and Spanish. • The Dynamic Language Center, a State Certified MWBE, was selected from the State Written Translation Master Contract for translation services.

25. DES & ORIAhttp://www.ora.wa.gov/business.asp

26. DES & OMWBE & WSDOT & ORIA • Coordinate our respective outreach to the small business community • Create common print communications to the small business community • Explore opportunities to use state data sources to better understand the business community

27. Small Business Assistance Websites • www.Business.wa.gov Doing Business in Washington State • http://www.ora.wa.gov/documents/sbl_flyer.pdf Small Business Liaison Agency Contact List

28. DES Policies DES has issued the following policies: • Delegation of Authority (# DES-090-00) • Sole Source Contracts (# DES-140-00) • Direct Buy (# DES-125-03) • Emergency Procurements/Purchases (# DES-130-00) • Complaints and Protests (# DES-170-00) • Agency Contract Reporting (# DES-210-01)

29. Debarment • Authority granted in RCW 39.26.200 • Rules adopted in chapter 200-305 WAC • Internal Administrative Procedure Training Completed

30. Initiatives • Delegation of Authority • Risk Assessment Pilot • Debarment Rules and Procedures • Transparency requirements under RCW 39.36.210 • Small Business Initiatives, including development of a Model Plan and Technical Assistance Reporting • Sole Source, Direct Buys and Emergency Procurement

31. Small Business Initiatives • Business diversity outreach unit. • IT Project to modify WEBS. • Small Business Initiatives, including development of a Model Plan and Technical Assistance Reporting. • Coordination with OMWBE & DVA for reporting collaboration. • Increased direct buy limit for small business purchases. • Development of inclusion plan strategy for goods & services and construction procurement.

32. Models, Policies and Best Practices • Protest Bonds Policy (in Draft) • E-signature • Competitive Procurement Models and Best Practices • Complaint and Protest Model • Training Policy for state purchasing & contracting staff • Convenience Contracts Models and Best Practices • More to be identified…here is your opportunity to include effective models and best practices for minority business community public procurement success

33. Upcoming DES Provided FREE Vendor Training • May 22, 2014 Vendor Training at the Spokane Convention Center • September 10-11, 2014 Training Conference and Trade Show in Tacoma • Topics include legislator requested export training and procurement reform update with a request for work group and reviewer participation

34. DES Resources • Procurement Reform Questions: • desprocurementreform@des.wa.gov • Procurement Reform Website: http://des.wa.gov/about/pi/ProcurementReform/Pages/default.aspx • Lori McCleary (360) 407-8217 • lori.mccleary@des.wa.gov • ______________________________________________________________________ • Business Diversity & Outreach Manger • Servando Patlán (360) 407-9390 • servando.patlan@des.wa.gov