Bill Text: HI HR49 | 2018 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Requesting A Study On Indirect Cost Provisions And Timeliness Of State Of Hawaii Payments Under Department Of Health, Department Of Human Services And Department Of Public Safety Contracts.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2018-03-28 - Report adopted. referred to the committee(s) on FIN as amended in HD 1 with none voting aye with reservations; none voting no (0) and Representative(s) Souki excused (1). [HR49 Detail]

Download: Hawaii-2018-HR49-Introduced.html

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HOUSE OF REPRESENTATIVES	H.R. NO.	49
TWENTY-NINTH LEGISLATURE, 2018
STATE OF HAWAII

HOUSE RESOLUTION

 

 

requesting studies on indirect and overhead cost reimbursements and timeliness of payments to nonprofit health and human service providers contracted by the government.

 

 

 

     WHEREAS, a recent national study noted that half of nonprofit service providers working under government contracts and grants reported that the government limited reimbursements to nonprofits or excluded nonprofits from administrative and overhead cost reimbursements; and

 

WHEREAS, roughly 20 to 25 percent of the study respondents said the government paid no administrative expenses, while nearly 75 percent said the government limited reimbursements to 10 percent or less; and

    

     WHEREAS, the majority of nonprofits in thirty-four states said government contracts and grants limited reimbursement for overhead costs, and a majority of nonprofits in twenty-seven states reported limits on administration expenses; and

 

WHEREAS, nonprofits are still suffering financially from the 2008 recession and are additionally burdened by late payments from the government; and

 

WHEREAS, according to a more recent national report, 68 percent of human service nonprofits reported concerns with the government not paying the full cost of services and about 75 percent of respondents reported that the complexity and time required for applying and reporting on contracts was a problem; and

 

WHEREAS, as a result of the recession, many Hawaii nonprofits have faced reduced revenues from individuals, foundations, corporations, investments, and government sources, but have experienced an increased demand for services that has caused financial pressure on nonprofits and forced them to freeze or reduce employee salaries, draw on reserves, cut back on the number of employees, borrow funds, or reduce the hours of operations; and

 

WHEREAS, while the State Legislature in 2011 created a Prompt Payment Task Force to look into the recurring problem of late government payments to nonprofits and in 2012 expanded the scope of the initial task force to address the broad array of problems in the government contracting system, stakeholders said this action did not result in the implementation of meaningful recommendations or change; and

 

WHEREAS, it is in the best interest of the State to promote the effective and efficient delivery of health and human services by nonprofit service providers through the procurement of services under chapter 103F, Hawaii Revised Statutes; now, therefore,

 

BE IT RESOLVED by the House of Representatives of the Twenty-ninth Legislature of the State of Hawaii, Regular Session of 2018, that the State Procurement Office Administrator is requested to:

 

     (1)  Conduct a review of indirect costs and limits, if any, imposed by the contracts awarded to nonprofit service providers under chapter 103F, Hawaii Revised Statutes, over the period of 2015 to 2017; and

 

     (2)  Address processes, policies, or practices that impact the ability of nonprofit service providers to adequately be reimbursed for administrative and overhead costs; and

 

BE IT FURTHER RESOLVED that the Auditor is requested to:

 

     (1)  Conduct a review of the length of time payment is received by nonprofit service providers under contracts awarded under chapter 103F, Hawaii Revised Statutes, over the period of 2015 to 2017; and

     (2)  Address processes, policies, or practices that contribute to delayed government payments to nonprofit service providers, and include proposed contingency plans, such as allowing nonprofit service providers to resubmit invoices at later dates to avoid the payment of interest or other fees; and

 

BE IT FURTHER RESOLVED that the State Procurement Office Administrator and Auditor are requested to submit reports of findings and recommendations, including any proposed legislation, to the Legislature no later than 20 days prior to the convening of the Regular Session of 2019; and

 

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Governor, Comptroller, Auditor, State Procurement Office Administrator, Chief Information Officer, and the Director of the Office of Information Practices.

 

 

 

	OFFERED BY:	_____________________________

Report Title: 

Government Contracts; Payment Timeliness; Reimbursement; Overhead; Administrative Costs; Study