GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1997

S	2 

SENATE BILL 862
Judiciary Committee Substitute Adopted 4/28/97

Short Title:  UNC Contracts Negotiations.	(Public)

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Sponsors:

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Referred to:  

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April 15, 1997

A BILL TO BE ENTITLED
AN ACT TO PROVIDE GREATER FLEXIBILITY TO THE UNIVERSITY OF NORTH CAROLINA IN NEGOTIATING CERTAIN CONTRACTS AND CAPITAL PROJECTS, TO INCREASE THE BENCHMARK FOR PURCHASES BY THE UNIVERSITY OF NORTH CAROLINA AND OTHER STATE AGENCIES, AND TO AUTHORIZE EMPLOYEE PAYROLL DEDUCTIONS FOR CERTAIN DISCRETIONARY PRIVILEGES OF UNIVERSITY SERVICE AT THE UNIVERSITY OF NORTH CAROLINA.
The General Assembly of North Carolina enacts:
Section 1.  Article 1 of Chapter 116 of the General Statutes is amended by adding two new sections to read:
"§ 116-31.10.  Powers of Board regarding certain purchasing contracts.
Notwithstanding G.S. 143-53.1 or G.S. 143-53(a)(2), the expenditure benchmark for a special responsibility constituent institution with regard to competitive bid procedures and the bid value benchmark shall be an amount not greater than two hundred fifty thousand dollars ($250,000).  The Board shall set the benchmark for each institution from time to time.  In setting an institution's benchmark in accordance with this section, the Board shall consider the institution's overall capabilities including staff resources, purchasing compliance reviews, and audit reports.  The Board shall also consult with the Director of the Division of Purchase and Contract and the Director of the Budget prior to setting the benchmark.
"§ 116-31.11.  Powers of Board regarding certain fee negotiations, contracts, and capital improvements.
(a)	With regard to buildings at The University of North Carolina, the Board shall conduct the fee negotiations and supervise the letting of all contracts for the design, construction, or renovation for the following:
(1)	Open-end design agreements.
(2)	Individual projects if the project costs three hundred thousand dollars ($300,000) or less and is designed under the terms of an open-end design agreement.
(3)	Minor individual capital improvements projects costing five hundred thousand dollars ($500,000) or less.
(b)	The Board may delegate its authority under subsection (a) of this section to the affected constituent institution if the institution is qualified under university procedures approved by the State Building Commission.
(c)	All duties and responsibilities of the Department of Administration and the Director of the Office of State Construction of the Department of Administration set forth respectively in G.S. 143-341(3) and G.S. 143-135.3 are delegated to the Board for capital improvements projects of The University of North Carolina costing one million dollars ($1,000,000) or less.
	The Board of Governors shall determine, in consultation with the State Building Commission and the Director of the Budget, the extent to which this authority may be further delegated to the constituent institutions."
Section 2.  G.S. 143-52 reads as rewritten:
"§ 143-52.  Competitive bidding procedure; consolidation of estimates by Secretary; bids; awarding of contracts.
As feasible, the Secretary of Administration will compile and consolidate all such estimates of supplies, materials, printing, equipment and contractual services needed and required by State departments, institutions and agencies to determine the total requirements of any given commodity.  Where such total requirements will involve an expenditure in excess of the expenditure benchmark established under the provisions of G.S. 143-53.1 and where the competitive bidding procedure is employed as hereinafter provided, sealed bids shall be solicited by advertisement in a newspaper widely distributed in this State or through electronic means, or both, as determined by the Secretary to be most advantageous, at least once and at least 10 days prior to the date designated for opening.  Except as otherwise provided under this Article, contracts for the purchase of supplies, materials or equipment shall be based on competitive bids and acceptance made of the lowest and best bid(s)	most advantageous to the State as determined upon consideration of the following criteria: prices offered; the quality of the articles offered; the general reputation and performance capabilities of the bidders; the substantial conformity with the specifications and other conditions set forth in the request for bids; the suitability of the articles for the intended use; the personal or related services needed; the transportation charges; the date or dates of delivery and performance; and such other factor(s) deemed pertinent or peculiar to the purchase in question, which if controlling shall be made a matter of record.  Competitive bids on such contracts shall be received in accordance with rules and regulations to be adopted by the Secretary of Administration, which rules and regulations shall prescribe for the manner, time and place for proper advertisement for such bids, the time and place when bids will be received, the articles for which such bids are to be submitted and the specifications prescribed for such articles, the number of the articles desired or the duration of the proposed contract, and the amount, if any, of bonds or certified checks to accompany the bids.  Bids shall be publicly opened.  Any and all bids received may be rejected.  Each and every bid conforming to the terms of the invitation, together with the name of the bidder, shall be tabulated and that tabulation shall become public record in accordance with the rules adopted by the Secretary.  All contract information shall be made a matter of public record after the award of contract. Provided, that trade secrets, test data and similar proprietary information may remain confidential.  A bond for the faithful performance of any contract may be required of the successful bidder at bidder's expense and in the discretion of the Secretary of Administration.  After contracts have been awarded, the Secretary of Administration shall certify to the departments, institutions and agencies of the State government the sources of supply and the contract price of the supplies, materials and equipment so contracted for.  Prior to adopting other methods of advertisement under this section, the Secretary of Administration may consult with the Advisory Budget Commission.  Prior to adopting rules and regulations under this section, the Secretary of Administration may consult with the Advisory Budget Commission."
Section 3.  G.S. 143-53(a) reads as rewritten:
"(a)	The Secretary of Administration may adopt rules governing the following:
(1)	Prescribing the routine and procedures to be followed in canvassing bids and awarding contracts, and for reviewing decisions made pursuant thereto, and the decision of the reviewing body shall be the final administrative review.
(2)	Prescribing routine, including consistent contract language, for securing bids on items that do not exceed the bid value benchmark established under the provisions of G.S. 143-53.1 or G.S. 116-31.10.
	   The purchasing delegation for securing offers, (excluding the special responsibility constituent institutions of The University of North Carolina), for each State department, institution, agency, community college, and public school administrative unit shall be determined by the Director of the Division of Purchase and Contract.  For the State agencies this shall be done following the Director's consultation with the State Budget Officer and the State Auditor.  The Director for the Division of Purchase and Contract may set or lower the delegation, or raise the delegation upon written request by the agency, after consideration of their overall capabilities, including staff resources, purchasing compliance reviews, and audit reports of the individual agency.  The routine prescribed by the Secretary shall include contract award protest procedures and consistent requirements for advertising of solicitations for securing offers issued by State departments, institutions, universities (including the special responsibility constituent institutions of The University of North Carolina), agencies, community colleges, and the public school administrative units.
(3)	Defining contractual services for the purposes of G.S. 143-49(3) and G.S. 143-49(5).
(4)	Prescribing items and quantities, and conditions and procedures, governing the acquisition of goods and services which may be delegated to departments, institutions and agencies, notwithstanding any other provisions of this Article.
(5)	Prescribing conditions under which purchases and contracts for the purchase, rental or lease of equipment, materials, supplies or services may be entered into by means other than competitive bidding.
(6)	Prescribing conditions under which partial, progressive and multiple awards may be made.
(7)	Prescribing conditions and procedures governing the purchase of used equipment, materials and supplies.
(8)	Providing conditions under which bids may be rejected in whole or in part.
(9)	Prescribing conditions under which information submitted by bidders or suppliers may be considered proprietary or confidential.
(10)	Prescribing procedures for making purchases under programs involving participation by two or more levels or agencies of government, or otherwise with funds other than State-appropriated.
(11)	Prescribing procedures to encourage the purchase of North Carolina farm products, and products of North Carolina manufacturing enterprises.
(12)	Repealed by Session Laws 1987, c. 827, s. 216."
Section 4.  G.S. 143-53.1 reads as rewritten:
"§ 143-53.1.  Setting of benchmarks; increase by Secretary.
On and after July 1, 1997, the procedures  prescribed by G.S. 143-52 with respect to competitive bids and the bid value benchmark authorized by G.S. 	143-53(a)(2) with respect to rule making by the Secretary of Administration for competitive bidding shall be no more than twenty-five thousand dollars ($25,000); provided, the Secretary of Administration may, in his or her  discretion, increase the benchmarks effective as of the beginning of any fiscal biennium of the State commencing after June 30, 1999, in an amount whose increase, expressed as a percentage, does not exceed the rise in the Consumer Price Index during the fiscal biennium next preceding the effective date of the benchmark increase. For a special responsibility constituent institution of The University of North Carolina, the benchmark prescribed in this section shall be as provided in G.S. 116-31.10."
Section 5.  G.S. 143-341(3) reads as rewritten:
"(3)	Architecture and Engineering:
a.	To examine and approve all plans and specifications for the construction or renovation of:
1.	All State buildings; and
2.	All community college buildings requiring the estimated expenditure for construction or repair work for which public bidding is required under G.S. 143-129
	prior to the awarding of a contract for such work; and to examine and approve all changes in those plans and specifications made after the contract for such work has been awarded.
b.	To prepare preliminary studies and cost estimates and otherwise to assist all agencies in the preparation of requests for appropriations for the construction or renovation of all State buildings.
c.	To supervise the letting of all contracts for the design, construction or renovation of all State buildings and all community college buildings whose plans and specifications must be examined and approved under a.2. of this subdivision, except as provided in G.S. 116-31.11.
d.	To supervise and inspect all work done and materials used in the construction or renovation of all State buildings and all community college buildings whose plans and specifications must be examined and approved under a.2. of this subdivision; and no such work may be accepted by the State or by any State agency until it has been approved by the Department.
e.	With respect to capital improvements projects of The University of North Carolina, all duties and responsibilities of the Department set forth in subdivision (3) of this section, are delegated to the Board of Governors of The University of North Carolina to the extent provided by G.S. 116-31.11(c)."
Section 6.  G.S. 143-64.34 reads as rewritten:
"§ 143-64.34.  Exemption of certain State Capital Improvement Projects. 
State Capital Improvement Projects under the jurisdiction of the State Building Commission where the estimated expenditure of public money is less than one hundred thousand dollars ($100,000) are exempt from the provisions of this Article.  Further, with respect to capital improvement projects for The University of North Carolina, including its constituent institutions and the North Carolina School of Science and Mathematics, individual projects having estimated expenditures of public money of three hundred thousand dollars ($300,000) or less are exempt from the provisions of this Article provided that the architectural, engineering, and surveying services to be rendered are included under the provisions of an open-end design agreement that has been publicly announced."
Section 7.  G.S. 143-135.3 is amended by adding a new subsection to read:
"( f)	With respect to capital improvement projects of The University of North Carolina costing one million dollars ($1,000,000) or less, all duties and responsibilities of the Department of Administration set forth in this section are delegated to the Board of Governors of The University of North Carolina."
Section 8.  G.S. 143-3.3 is amended by adding a new subsection to read:
"( k)	Payroll Deduction for University of North Carolina System Employees to Pay for Discretionary Privileges of University Service. – Subject to rules adopted by the State Controller, if a constituent institution of The University of North Carolina approves a payroll deduction plan under this subsection, an employee of the constituent institution may authorize, in writing, the periodic deduction from the employee's salary or wages paid for employment by the constituent institution, of one or more designated lump sums to be applied to the cost of corresponding discretionary privileges available at employee expense from the employing institution.  Discretionary privileges from the employing institution that may be paid for through this subsection include parking privileges, athletic passes, use of recreational facilities, admission to campus concert series, and access to other institutionally hosted or provided entertainments, events, and facilities."
Section 9.  The Office of State Budget and Management shall evaluate the process and quality of construction completed under G.S. 116-31.11 as enacted by this act.  The evaluation shall include an analysis of the time required to complete projects, project savings or costs, necessary increases or decreases in staffing, if any, any other benefits or detriments regarding the delegation of authority under G.S. 116-31.11; recommendations regarding the continuance of the delegated powers, their continuance with modifications, their expansion, or their discontinuance.  The Office of State Budget and Management shall report its findings and recommendations to the Board of Governors of The University of North Carolina and to the General Assembly by April 15, 2001.
Section 10.  The  Office of State Budget and Management shall evaluate the  effectiveness and efficiency of the increase of the purchasing benchmark and its delegation to the special responsibility constituent institutions under G.S. 116-31.10 and other agencies under G.S. 143-53.1 and G.S. 143-53(a)(2).  In its evaluation the Office of State Budget and Management shall consider such factors as costs of goods and services purchased, administrative costs, effective time for completion of the purchasing process, agency satisfaction, vendor reactions, and other factors it deems appropriate.  The Office of State Budget and Management shall report its findings and recommendations to the General Assembly by April 15, 2001.
Section 11.  This act is effective when it becomes law.  G.S. 116-31.11(c), as enacted by Section 1 of this act, shall expire July 1, 2001.