Updates from OIT and CCU

1. Updates from OIT and CCU CCIT Presentation July 20, 2011

2. Governor’s Office of Information Technology • Effective March 26, 2010, OIT required a copy of all IT contracts to be attached to the CMS record for informational access and reporting purposes. • Reduces redundancy and increases efficiency in the IT contract process. • Upon review of CMS records, OIT has discovered many contracts have not been scanned and attached.

3. Governor’s Office of Information Technology • Scanning and attaching the contract to the CMS record is an OIT requirement in lieu of a hard copy of the contract being sent to OIT. • Requirement includes attachment of amendments, task orders etc. in CMS.

4. Governor’s Office of Information Technology • This requirement also applies to the procurement of personal services of an IT nature, in excess of $100,000, on a price agreement via a purchase order. • To ensure compliance, create a CMS record and attach a copy of the purchase order and all related back up for that procurement.

5. Governor’s Office of Information Technology • Create the contract record in CMS using the “Personal Services” Contract Group/Type and “Purchase Orders (>$100,000)” as the Contract Sub-type.

6. Governor’s Office of Information Technology • OIT is now monitoring this requirement! • To establish compliance, agencies must attach copies of all IT contracts to the associated CMS record by August 31, 2011. • IHEs are encouraged to attach copies of their IT contracts.

7. Governor’s Office of Information Technology • If you do not have scanning capability, please contact: Thirza A. KennedyProcurement Director Governor's Office of Information Technology (OIT)601 East 18th Avenue, Suite 250Denver, Colorado 80203 Phone: 303.764.7926 Fax:  303.764.7899Email: thirza.kennedy@state.co.uswww.colorado.gov/oit

8. Central Contracts Unit - CORA • SB 11-025 • Effective Date: July 1, 2011 • Colorado Taxpayer Empowerment Act of 2011, CRS §24-101-401, requires that to the extent not prohibited by federal law, each contract entered into by a governmental body pursuant to this code shall specify that the contract and performance measures and standards under Article 103.5 of this title are open to inspection by the public as provided in Sections 24-72-203 and 24-72-204.

9. Central Contracts Unit - CORA • New General Provision in OSC Personal Services and Grant templates: • CORA Disclosure. To the extent not prohibited by federal law, this Contract and the performance measures and standards under CRS §24-103.5-101, if any, are subject to public release through the Colorado Open Records Act, CRS §24-72-101, et seq. • Note: Change of “Contract” to “Grant” in grant template.

10. Central Contracts Unit - CORA • SBP has updated their templates. • Provision does not apply to: • interagency agreements; or • purchase orders.

11. Central Contracts Unit – Other Statute Changes • HB 11-1202 • Effective Date: January 1, 2012 • Amends CRS §24-91-103.6 to require every public works contract to contain a clause prohibiting the issuance of any change order, as defined in Section 24-101-301(2), or other form of order or directive by the public entity requiring additional compensable work to be performed, which work causes the aggregate amount payable under the contract to exceed the amount appropriated for the original contract, unless:

12. Central Contracts Unit – Other Statute Changes • the contractor is given written assurance by the public entity that lawful appropriations to cover the cost of the additional work have been made and the appropriations are available prior to performance of the additional work or unless such work is covered under a remedy granting provision in the contract.

13. Central Contracts Unit – Other Statute Changes • Results in no change to OSC templates on website; however, those agencies conducting construction outside of the SBP process should evaluate their processes for compliance. • SBP did not feel this statute required changes to their templates.

14. Central Contracts Unit – Other Statute Changes • HB 11-1115 • Effective Date: August 10, 2011 (assuming general assembly adjournment on 5/11/11 and no referendum petition) • Applies to contracts for construction, alteration or repair of any highway, public building, public work or public improvement, structure or system. • Limits retainage to 5%. • Requires final settlement within 60 days after contract is completed satisfactorily and finally accepted by the public entity.

15. Central Contracts Unit – Other Statute Changes • Results in no change to OSC templates on website; however, those agencies conducting construction outside of the SBP process should evaluate their processes for compliance. • SBP has updated their templates.

16. Central Contracts Unit – Fiscal Rule waivers • OSC is moving away from perpetual fiscal rule waivers. • Generally, 5 year limit. • If you have an existing perpetual FR waiver, you may be requested to re-apply for the FR waiver and OSC approval may be for a limited duration.

17. Central Contracts Unit – Fiscal Rule waivers • Reason for change: • Tracking of FR waivers; • Allow re-evaluation of changed circumstances for FR waiver; and • Removal of obsolete FR waivers. • Contact FAST or CCU with any questions.

18. Central Contracts Unit – Indemnification • Modification/removal of “Indemnification” provision in OSC templates as discussed at the November 17, 2010 CCIT meeting and in November 19, 2010 CCIT email.

19. Central Contracts Unit – Indemnification • Type A - Contracts with a Colorado city or county, or the Federal government: • provisions calling for indemnification of the State may be removed without further approval of the OSC. • “Colorado city or county” means a city, a county, a city and county (e.g., the City and County of Denver) or a town.

20. Central Contracts Unit – Indemnification • The Type A exception does not apply to: • quasi-governmental or other public entities in Colorado, such as public school districts; or • to other states or their cities and counties; or • to any non-profit corporations or associations.

21. Central Contracts Unit – Indemnification • Type B – If your contract does not meet the Type A requirements, indemnification provisions of the State may be removed only if all the following 4 requirements are met: • The contractor/grantee requests the provisions be removed. • An analysis is performed, and a determination made, that the benefits of removing the provisions outweigh the risks to the State.

22. Central Contracts Unit – Indemnification • The finding and the basis for removal are documented in the contract file. • The documentation must be included with any contract sent to the OSC for review (or an explanation can be entered into CMS by attachment). • For both Type A and Type B contracts, removing these provisions is an option, not a requirement.

23. Central Contracts Unit – Indemnification • Remember – This guidance allows the removal of the provision for indemnification of the State. • This does not allow the State to indemnify another, which is prohibited by State Constitution.

24. Central Contracts Unit – Indemnification • The constitutional prohibition is based upon Art. V, Section 33 (Disbursement of public money) and Art. XI, Section 1 (Pledging Credit). • Technically, indemnification is a 2 step process in which (1) the State pledges the credit of the State, and (2) a disbursement is made without an appropriation substantiated by an executed voucher.

25. Central Contracts Unit – Indemnification • Are cities and counties prohibited from indemnification? • While counties are subject to Art. XI, Section 1, they are not subject to Art. V, Section 33. Only the State has both limitations. As such, the AG’s position has been that only the State is prohibited from indemnifying another entity/person.

26. Central Contracts Unit – Indemnification • If you want to keep the indemnification provision for cities and counties, you can add “To the extent permitted by law” to the provision without requiring OSC approval. • This is an immaterial change as the State would never require another to do something against the law.

27. Central Contracts Unit – Limitation of Liability • In connection with an indemnification requirement, a vendor may request a limitation of liability. • CCU preference is not to allow limitations of liability. • If the choice is between allowing a limitation of liability, to keep indemnification, or removing indemnification, the CCU prefers that you remove indemnification.

28. Central Contracts Unit – Limitation of Liability • If a limitation of liability cannot be avoided, you must: • Comply with OSC Policy, Vendor Agreements, prohibiting any limitation for claims or damages arising out of bodily injury (including death) and damage to tangible property. • This includes consequential damages. • Conduct analysis and determine that the benefits of the contract outweigh the risks to the State from the limitation.

29. Central Contracts Unit – Limitation of Liability • The finding and the basis for accepting the provision must be documented in the contract file. • The documentation must be included with any contract sent to the OSC for review (or an explanation can be entered into CMS by attachment).

30. E-Verify/Departmental Program • Bob Jaros’ presentation to you on the E-Verify/Department Program at CCIT in February 2011 reflected CDLE’s plans based upon meetings both he and Brenda Lujan had with CDLE. • Because of questions raised by agencies/IHE’s regarding the Program, we contacted CDLE requesting a representative attend CCIT to answer questions.

31. E-Verify/Departmental Program • Unfortunately, CDLE could not present today due to resource issues; however, Peter Wingate at CDLE, provided the following information: • CDLE is empowered to investigate and to assist in investigations of compliance with the E-Verify Program or State Program. • CDLE is only a fact finding agent. It has no authority to impose fines/charges etc. for violations.

32. E-Verify/Departmental Program • It is up to the agency/IHE to decide what to do with compliance information. • Be aware that if a Contractor is using E-Verify, by federal law, there is a MOU between the contractor and the federal government limiting disclosure of such Contractor’s E-Verify compliance/information to third parties. • CDLE has requested a waiver of this limitation from the federal government. This request is still pending.

33. E-Verify/Departmental Program • As a result, if requesting verification from a Contractor and the Contractor states that it is complying with: • E-Verify, your investigation should stop there; or • State Program, you should receive a “Notice of Participation in the Department Program for Public Constructs for Services” and a “Contractor Affirmation” for new hires.

34. E-Verify/Departmental Program • What do you do with violations? • State Law -Agencies/IHE’s may terminate their contracts with the Contractor for violations of this statute. • It is within the discretion of the contracting agency/IHE to continue or terminate the contract • Federal Law - Agencies/IHE’s should contact their AG with questions regarding violations from a federal compliance standpoint.

35. E-Verify/Departmental Program • Current Status - CDLE has not started compliance audits and does not intend to start them soon. • CDLE is currently being audited by the State auditors for this program and does not anticipate having further information to convey until post-audit sometime in September or October 2011.

36. E-Verify/Departmental Program • State audit results may have a significant impact on the Illegal Aliens, Public Contracts for Services law, CRS §8-17.5-101 and 102 and its implementation. • CDLE’s webpage for Public Contracts for Services and Illegal Aliens is: http://www.colorado.gov/cdle/pcs • OSC’s webpage for Contracts and Unauthorized Immigrants is: http://www.colorado.gov/dpa/dfp/sco/contracts/Unauthorized_Immigrants.htm

37. E-Verify/Departmental Program • For more information, contact: • Peter Wingate, Ph.D. Labor Standards Administrator Colorado Division of Labor 633 17th Street, Suite 200 Denver, CO 80202-3660 303-318-8457 peter.wingate@state.co.us