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Chief Procurement Office

Chief Procurement Office. 100 th General Assembly Update October 2017. 100 th General Assembly. PA 100-0002 Amends the Prevailing Wage Act.

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Chief Procurement Office

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  1. Chief Procurement Office 100th General Assembly Update October 2017

  2. 100th General Assembly • PA 100-0002 • Amends the Prevailing Wage Act. • Requires IDOL to publish on its website by no later than 8/15 the prevailing wage schedule for each county. Based on investigation of wages during the month of June. May do more frequently. • Effective date 6/16/17.

  3. 100th General Assembly • PA 100-0023 • Amends Section 20-60, 25-45, and 40-25 of the Procurement Code (Code). • Allows energy conservation contracts to be entered into for 15 years. Provides definitions of energy savings contracts and leases. • Effective date 7/6/17.

  4. 100th General Assembly • PA 100-0043 • Omnibus bill that amends the State Officials and Employees Ethics Act, Code, Governmental Joint Purchasing Act (GJPA), State Prompt Pay Act, Business Enterprise Act and Illinois Human Rights Act. • Effective date 8/9/17, except for the 1-10(b) posting of exempt transactions which has an effective date of 10/1/17.

  5. 100th General Assembly • PA 100-0043 (con.) • Requires ethics training on reporting of procurement communications, anticompetitive practices, and confidentiality requirements of the Code.

  6. 100th General Assembly • PA 100-0043 (con.) • Exemptions under 1-10 are modified. • Not exempt: • Procurements for P & A contracts for persons/entities providing services for NIU for non-credit educational services or products by means of specialized programs. • Certain procurements by the Illinois Health Information Exchange Authority, and Illinois Power Agency.

  7. 100th General Assembly • PA 100-0043 (con.) • Exemptions under 1-10 are modified. • Exempt: • Procurements for participation required by a domestic or international trade show or exhibition. • Procurements for ISAC to procure services paid for from the Illinois Prepaid Tuition Fund. • Certain railroad/utility relocations.

  8. 100th General Assembly • PA 100-0043 (con.) • Exemptions under 1-10 are modified (con.) • For contracts entered on or after October 1, 2017, except for IGAs, grants, and collective bargaining contracts, each state agency/university is required to post to the Bulletin the following information for every exempt contract under 1-10(b): • The name of the contractor • A description of the supply or service • The total amount of the contract • The term of the contract • The exception of the Code utilized • CPOs submit annual summary to the GA.

  9. 100th General Assembly • PA 100-0043 (con.) • Reinstates the 1-12 exceptions for artistic and musical services, never intended to be repealed.

  10. 100th General Assembly • PA 100-0043 (con.) • 1-13 exemptions are reinstated, never intended to be repealed. • Adds IMSA into the definition of public institution of higher education. • Adds to the artistic and musical exemption athletic events and amends section so that events are not required to be held at venues operated by university, they just must be for events that are by or for a university. • Adds to the periodicals exemption subscriptions, database licenses and other publications procured by a university library or academic department. • Adds back the exemption for placement of students in externships, practicums, field experiences, and medical residencies and rotations.

  11. 100th General Assembly • PA 100-0043 (con.) • 1-13 exemptions are reinstated (con.) • Adds back exemption for programing and broadcast license rights for university owned radio and television stations. • Adds to the exemption procurements necessary to perform sponsored research or other sponsored activities under grants and contracts funded by the sponsor or sources other than State appropriations. • However, amends the exemption to provide that procurements made for the fulfillment of a grant shall be made in accordance with the Procurement Code to the extent practicable. 1-13(c). • Adds to the exemption procurements with a foreign entity for research or educational activities, provided there is no office of the foreign entity in the US, or when the foreign entity is the sole source of the service or product.

  12. 100th General Assembly • PA 100-0043 (con.) • 1-13 exemptions reinstated (con.) • Amends the exemption of contracts from “FDA-regulated supplies” to contracts for “medical supplies”. Adds to the exemption for medical supplies and services those procurements that are at any university-operated health care center or dispensary that provides care, treatment, or medications for students, faculty or staff. 1-13 (b-5). • All contracts entered through a 1-13(b) exemption must be published to the Bulletin within 14 calendar days of contract execution and the following information must be provided in a monthly report to the CPO: • The name of the contractor, • A description of the supply or service • The total amount of the contract • The term of the contract • The exception of the Code utilized.

  13. 100th General Assembly • PA 100-0043 (con.) • Adds definitions in 1-15 for construction support, electronic procurement, master contract, multiple award, no-cost contract, and completion of sentence (50-10). • Master contract(1-15.47)=definite quantity, indefinite quantity, or requirements contract awarded in accordance with this Code, against which subsequent orders may be placed to meet the needs of a State purchasing entity. A master contract may be for use by a single State purchasing entity or for multiple State purchasing entities and other entities as authorized under the GJPA. • The definition in the Code for master contract is different than the GJPA.

  14. 100th General Assembly • PA 100-0043 (con.) • No-cost contract (1-15.49)=a contract in which the State of Illinois does not make a payment to or receive a payment from the vendor, but the vendor has the contractual authority to charge an entity other than the State of Illinois for supplies or services at the State's contracted rate to fulfill the State's mandated requirements.

  15. 100th General Assembly • PA 100-0043 (con.) • Reduces PPB review time from 30 to 14 days, requires prompt cooperation with PPB.

  16. 100th General Assembly • PA 100-0043 (con.) • SPO certification UPPCC or the Institute for Supply Management. • Adds ability for SPO to conduct reviews of contracts prior to execution, attend procurement meetings, access records, submit reports to CPO on procurement issues, ensure agencies and universities maintaining appropriate records, ensure transparency, and report misconduct, waste or inefficiency.

  17. 100th General Assembly • PA 100-0043 • PCMs may be appointed (verses shall be appointed). • Fiduciary duty for all-CPO, SPO, PCM.

  18. 100th General Assembly • PA 100-0043 (con.) • Makes minor changes to Electronic Bulletin clearinghouse and names of directories that are required to provide instruction/information to vendors on how to register for Bulletins. • Allows for opening of bids and offers through electronic procurement system.

  19. 100th General Assembly • PA 100-0043 (con.) • Raises competitive threshold for procurements to $100,000 for supplies, services, construction and professional and artistic services. Construction procurements of less than $100,000 may be made by an alternative competitive source selection on basis of rules established by the construction agency. • Not apply to QBS.

  20. 100th General Assembly • PA 100-0043 (con.) • Raises to $100,000 annualized value of when evaluation and ranking of P & A procurements is required (increase from $25,000). • This does not apply to construction-related professional services awarded under QBS Act. • Replaces an emergency affidavit with a “statement”.

  21. 100th General Assembly • PA 100-0043 (con.) • Clarifies bidders or offerors (other than sole proprietors) must be legal entity prior to submitting bid, offer, or proposal, but amends requirements to be authorized to transact business or conduct affairs from “prior to submitting…” to “prior to execution of a contract.” • Allows for construction contracts under Section 30-20 and 33-10 to require bidders to be registered with SoS at time of pre-qualification. • For the legal entity, the practical effect is that foreign entities have to be a legal entity in their jurisdiction at the time of bid or offer, while Illinois businesses need to be registered with SOS at time of bid or offer. Foreign have to be registered with SOS by contract execution. • IPG=registered with SoS.

  22. 100th General Assembly • PA 100-0043 (con.) • Allows CPO to allow a 5-day cure period for vendor on SBE registration if CPO determines vendor made good faith effort to comply.

  23. 100th General Assembly • PA 100-0043 (con.) • Creates a new section of the Code (25-85) to allow universities, IDOA, IDOT, and IDNR to conduct “best value procurements” for heavy fleet vehicles and off-road construction equipment. Pilot until 6/30/2020. • BVP= total cost of ownership (includes warranty, repair and maintenance costs, fuel consumption and salvage value), product performance, supplier’s ability to perform contract requirements, and environmental benefits. • Cap of $20 million/year per institution. CPOs report to GA on whether to recommend continuation after pilot.

  24. 100th General Assembly • PA 100-0043 (con.) • Requires all leases to have an exercisable purchase option (change from “initial lease”).

  25. 100th General Assembly • PA 100-0043 (con.) • Defines digital and offset printing and allows use of soybean or vegetable oil-based ink in offset printing. Clarifies preference for soybean or vegetable oil-based ink does not apply to digital printing services. • Allows each CPO to determine, in consultation with ICI, those goods and services purchased through ICI.

  26. 100th General Assembly • PA 100-0043 (con.) • Each CPO may designate a small business specialist. • Changes date for VOSB and SDVOSB report. Amends definition of state agency to specifically include and clarify that goals apply to universities.

  27. 100th General Assembly • PA 100-0043 (con.) • Repeals SBCA and replaces in new section of Code (45-90). Requires CPOs to make public presentations and provide information to small businesses on the contracting process and how to apply for contracts and subcontracts.

  28. 100th General Assembly • PA 100-0043 (con.) • Changes the date for “re-certification” on multi-year contracts from July 1 to January 1. • Eliminates requirements for contractors and subcontractors who have no changes or whose work is substantially completed from being required to recertify. Only contractors/subs with changes will recertify. • The practical effect is there is no recertification because if a change is made, the vendor has the obligation to update/revise their certs and disclosures. Yearly recertification will be a reminder to update any changes.

  29. 100th General Assembly • PA 100-0043 (con.) • Prohibited bidder/offeror and communication reporting sections (50-10.5 and 50-39) clarifies an entity is not a prohibited vendor and communication does not have to be reported when asking for clarification, no competitive advantage, and the Q & A is posted to Bulletin. • Nothing prohibits person performing construction-related services from initiating contact with a business that performs construction for purpose of obtaining market costs or production time. • Adds OEIG to list of entities that must get report on anticompetitive practices.

  30. 100th General Assembly • PA 100-0043 (con.) • Adds State employees to those who must keep confidential and not compromise the fairness/integrity of the procurement or contracting process. • Adds no cost contracts to concessions and leases of state property (excludes universities).

  31. 100th General Assembly • PA 100-0043 (con.) • Adds definition of master contract and multiple award to GJPA (30 ILCS 525). Definition for master contract different than Procurement Code. • Allows CPOs to establish joint purchasing and cooperative purchasing programs. • Allows CPO to authorize purchases with other governmental entities in Illinois, another state, or consortium of governmental entities.

  32. 100th General Assembly • PA 100-0043 (con.) • Allows CPO to authorize the use of a contract issued by: • A competitive federal procurement. • Consortium of governmental, educational, medical, research or similar entity. • Group purchasing organization which the CPO or state agency is a member or affiliate. Includes GSA, Higher Education Cooperation Act, and the Midwestern Higher Education Compact Act. • Other methods deemed by CPO in best interest of State, considering recommendation of agency or university. • CPO may establish rules, policies, procedures for use of cooperative contracts. • Notice of award must be published to the Bulletin prior to use of the contract.

  33. 100th General Assembly • PA 100-0043 (con.) • Cooperative contracts do not apply to contracts under QBS Act. • When Illinois is the lead state, multiple award is allowed and procedures of Code must be followed. • Cooperative purchases must be made through a competitive process unless CPO determines it is impracticable, CPO may allow sole source or emergency. • CPO submit reports to GA for piggybacking, sole source and emergency conditions JPs by 11/1 each year.

  34. 100th General Assembly • PA 100-0043 (con.) • Amends the Prompt Pay Act to provide when a contractor receives payment, it shall pay each lower-tiered subcontractor and material supplier, and in turn, they shall pay their subs and material suppliers. If partial payment is made, must pay what each has earned. • When full payment is not made to a subcontractor or material supplier due to a deficiency, changes the authority for making the deficiency determination from the contractor to the State official or agency. • Provides for administrative hearings and debarment provisions. • Disallows offsetting to subcontractors or material suppliers without reasonable cause on IDOT construction contracts.

  35. 100th General Assembly • PA 100-0043 (con.) • Sets up a special committee under BEP Act to review procurement laws regarding contracting with BEP firms and to determine what changes should be made to laws to increase participation. • Requires at least 3 hearings (1 in Springfield and 1in Chicago). • Membership includes 12 members appointed by legislative leaders, CMS director/designee, Chairperson of BEP Council, and the 4 CPOs.

  36. 100th General Assembly • PA 100-0043 (con.) • Amends definition of eligible bidder under Human Rights Act to allow entity to have DHR number prior to contract award (v. prior to bid opening). • Construction and construction-related support must still have DHR number prior to bid opening.

  37. 100th General Assembly • PA 100-0154 • Amends the Prevailing Wage Act • Provides that where IDOL determines the prevailing wage for a public body, the public body satisfies the newspaper publication requirement by posting on the public body’s website a notice of determination with the hyperlink to the prevailing wage schedule for that locality that is published on IDOL’s website. • Effective date 8/18/17.

  38. 100th General Assembly • PA 100-0203 • Amends the Procurement Code. • Amends Section 45-35 and renames as not-for profit agencies for persons with significant disabilities. • Amends qualifications for not-for-profit agencies. • Amends the responsibilities of the State Use Committee to require the development of guidelines for qualifying agencies and clarifies the responsibility of Committee to review pricing for fairness and reasonableness.

  39. 100th General Assembly • PA 100-203 (con.) • Allows for subcontracting, based on guidelines developed by the Committee, requires Committee to approve in writing subcontracts and amendments to subcontracts, and requires subcontracts to be performed to the extent feasible by other qualified not-for-profit agencies. • Requires written explanation of current subcontracts not performed by a qualified not-for-profit agency and a plan to transfer the subcontract to a qualified not-for-profit agency. • Effective date 8/18/17.

  40. 100th General Assembly • PA 100-0376 • Amends the Prompt Payment Act, same changes to the Act as those contained in PA 100-0043. • Shifts from the prime contractor to the State agency the determination of withholding payment due to a deficiency. • Establishes administrative hearing process to resolve payment disputes for construction contracts between prime contractors and subcontractors. Contractors who fail to pay subcontractors without reasonable cause can be barred from State contracting for 6 months. Rules may be adopted for administrative hearing process. • Effective date 1/1/18.

  41. 100th General Assembly • PA 100-391 • Revisory Act (“female” changed to “women” throughout various acts, including the Procurement Code). • Effective date 8/25/17, except for new Section 8(i) is 1/1/18. • IDOT target market program sunsetted 6/30/17. • Amends BEP Act, “female-owned” businesses changed to “women-owned” businesses. BEP Act renamed to Business Enterprise for Minorities, Women, and Persons with Disabilities Act.

  42. 100th General Assembly • PA 100-0391 (con.) • Definition of utilization plan added to BEP Act. U-Plan demonstrates either meet goal or requesting a full or partial waiver and made GFE toward goal. • Amends Section 4(e) to delete reference to construction contracts, cure appears to apply to all State contracts, requires a utilization plan at time of bid/offer submission, and provides 10 calendar day cure from the date of notification of deficiency.

  43. 100th General Assembly • PA 100-0391(con.) • Adds subparagraph (f) to Section 4 (there is a separate Section 4f) to require non-construction solicitations to include u-plans and if fail to provide a u-plan, the bid or offer is non-responsive. • Increases time Council can recommend suspension from 1 to 3 years. • Requires each CPO to maintain a list on website of firms prohibited from contracting with State because of BEP violation.

  44. 100th General Assembly • PA 100-0391 (con.) • Requires each notice of award for a bid or offer to include: • bid/offeror’s name, • the bid amount, • the names of certified firm(s) identified in bid/offer who submitted u-plans, and • the bid amount and percentage of the contract award to BEP firms.

  45. 100th General Assembly • PA 100-391 (con.) • Requires state agencies and universities to review a vendor’s compliance with u-plans and the terms of its contract. • A vendor’s failure to comply with contractual commitment or to cooperate constitutes a material breach and allows for the State to declare a default, terminate the contract, and exercise remedies. A vendor shall be in breach of contract and subject to penalties for failure to meet contract goals, unless vendor can show GFE.

  46. 100th General Assembly • PA 100-0391 (con.) • CMS required to provide BEP Council with a report identifying all non-construction solicitations that exceed $20 million and that have less than a 20% goal prior to publication. CMS shall provide a report to BEP Council identifying all non-construction awards over $20 million that includes the dollar amount and percentage of participation by BEP firms. • Encourages telecom and communication entities to submit supplier diversity reports. BEP shall report any telecom/communication entity that fails to submit a report to CPOs who may prohibit entities from bidding on state contracts for 1 year.

  47. 100th General Assembly • PA 100-0391 (con.) • Creates new Section 8(i) (effective 1/1/18.) • Requires State agencies and universities to review all existing contracts prior to renewal to determine if the goal is being met and to determine if goal should be increased based on market conditions and availability of BEP firms. • Requires review of renewals at least 6 months prior to renewal to allow adequate time to rebid if prime contractor has not demonstrated GFE toward meeting the contract goal.

  48. 100th General Assembly • PA 100-0391 (con.) • Requires State agencies and universities to review existing contracts with no goal to determine if a goal can be established and to encourage vendor to include a goal, including completion of a u-plan. • Section 8(i) does not apply to construction and construction-related services procurements.

  49. 100th General Assembly • PA 100-0452 • Amends the Illinois False Claims Act. • Increases penalties for violations of IFCA to comport with federal False Claims Act. • Effective date 8/25/17.

  50. Contact Information Chief Procurement Office Higher Education 401 South Spring 522 Stratton Office Building Springfield, Illinois 62706 (217) 558-5143 E-Mail: eec.cpohe@illinois.gov Website www.illinois.gov/cpo/HigherEd/Pages/default.aspx

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