Bill Text: HI SB2600 | 2018 | Regular Session | Amended
Bill Title: Relating To Procurement.
Spectrum: Partisan Bill (Democrat 11-0)
Status: (Engrossed - Dead) 2018-03-12 - Referred to LAB/HED, FIN, referral sheet 38 [SB2600 Detail]
Download: Hawaii-2018-SB2600-Amended.html
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THE SENATE |
S.B. NO. |
2600 |
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TWENTY-NINTH LEGISLATURE, 2018 |
S.D. 2 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO PROCUREMENT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that the delivery and award of public works construction projects can be hindered by bid challenges resulting in a lapse of funding and other procurement issues. The legislature further finds that the execution and completion of public works projects are often delayed due to bid protests by non-lowest bidders challenging technical mistakes in the lowest bidder's proposal. As a result of bid protests, projects are delayed, funding lapses, and awards to non-low bidders increase final project costs.
Specifically, section 103D-302, Hawaii Revised Statutes, requires that all subcontractors or joint contractors to be used on a public works project, along with their scope of work, be listed on the bid proposal submitted to any state or county agency subject to the procurement code. The legislature further finds that many recent bid protests have been based on subcontractor listing and licensing issues, including where a bidder has failed to list a required subcontractor or when a listed subcontractor, unbeknownst to the general contractor, did not possess the appropriate license and was not qualified to perform the work.
The legislature further finds that time constraints between the time a bidder receives all subcontractor bids and the bid submission deadline can cause inadvertent failure to list a required subcontractor or listing of an improperly licensed subcontractor in a bid, resulting in a bid protest. Often, inadvertent errors occur due to the complexity of the laws regarding contractor licenses under chapter 444, Hawaii Revised Statutes; title 16, Hawaii Administrative Rules; and judicial, quasi-judicial, and agency interpretations of these laws and rules. The contractors license board currently recognizes over one hundred different specialty contractor licenses that a prime bidder must sort through to determine the appropriate subcontractor specialty to be listed on a bid. Hence, bidders and subcontractors sometimes misunderstand the licensing requirements.
In comparison, the federal government does not require the listing of subcontractors on any bid proposal. In fact, the federal government does not require a general contractor's license to bid on or perform construction work, nor do over twenty states. The legislature further recognizes that the 2000 American Bar Association's Model Procurement Code, the model for Hawaii's procurement code, does not include such a subcontractor listing requirement.
Therefore, the legislature finds that it is necessary to clarify the State's procurement code to reduce the number of subcontractors that must be listed in a bid proposal, thereby reducing the number of opportunities to challenge bids on the basis of subcontractor listing errors. The legislature also finds that clarifying the State's procurement code should not in any way change the statutory requirement to use licensed subcontractors under chapter 444, Hawaii Revised Statutes.
However, the legislature understands that implementing such a change to the procurement bidding process could create unforeseen difficulties and have unintended consequences. Therefore, the legislature finds that it is prudent to first test these changes on a smaller scale to determine their overall effectiveness in reducing wasted time and resources in the procurement process.
Accordingly, the purpose of this Act is to create a pilot program for subcontractor listing to be conducted by the University of Hawaii.
SECTION 2. (a) Notwithstanding any law to the contrary, including but not limited to chapter 103D, Hawaii Revised Statutes, there is established the subcontractor listing pilot program to be conducted by the University of Hawaii. Under this program, the University of Hawaii shall not require a listing of joint contractors or subcontractors to be included in competitive sealed bids for construction where the estimated contract value is less than $3,000,000.
(b) No later than twenty days prior to the convening of the regular session of 2020, the University of Hawaii shall submit a report to the legislature on the cost effectiveness of, and any efficiencies realized as a result of, the pilot program.
SECTION 3. This Act shall take effect on July 1, 2050, and shall be repealed on June 30, 2020.
Report Title:
Subcontractor Listing Pilot Program; UH
Description:
Establishes the subcontractor listing pilot program to be conducted by the University of Hawaii. Requires a report to the legislature. Effective 7/1/2050. Repealed 6/30/2020. (SD2)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
