SENATE 3rd Reading Unamended April 11, 2012 SENATE Amended 2nd Reading April 10, 2012Second Regular Session Sixty-eighth General Assembly STATE OF COLORADO REENGROSSED This Version Includes All Amendments Adopted in the House of Introduction LLS NO. 12-0416.01 Jason Gelender x4330 SENATE BILL 12-001 SENATE SPONSORSHIP Hudak, Bacon, Boyd, Foster, Heath, Shaffer B., Steadman HOUSE SPONSORSHIP Duran and Ryden, Senate Committees House Committees Local Government Appropriations A BILL FOR AN ACT Concerning contracting preferences for persons who employ at least a specified percentage of Colorado residents to perform the requirements of a government contract, and, in connection therewith, making an appropriation. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) On and after July 1, 2012, if a state agency (agency) or governmental body (body) issues an invitation for bids or a request for proposals for a construction contract for a public project (construction contract) or for a services contract that is, in either case, worth more than $1 million, the agency or body must grant a 3% preference to the bidder or offeror (contractor) if the contractor certifies that at least 90% of the employees who will perform the requirements of the contract are Colorado residents. With respect to a construction contract, an agency or body must also grant a contractor who receives the 3% preference: An additional 1% preference if the contractor certifies that it offers health care and retirement benefits to the employees who will perform the contract requirements; and An additional 1% preference if the contractor certifies that the employees who will perform the contract requirements have access to a federally qualified apprenticeship training program. With respect to a services contract, an agency or body must also grant a contractor who receives the 3% preference an additional 2% preference if the contractor certifies that it offers health care benefits and retirement benefits to the employees who will perform the requirements of the contract. An agency or body may not allow any of the preferences to a noncompliant contractor, and the contractor may not use the preference to satisfy a minimum requirement of a contract. A contractor that seeks a preference for a bid or offer must certify its eligibility for the preference to the agency or body that issued the invitation for bids or request for proposals. The agency or body may rely on the certification but may also require the contractor to submit substantiating documentation or other information needed to verify the contractor's eligibility for the preference. The executive director of the department of personnel must promulgate rules for the administration of each preference, including processes for a contractor to certify and an agency or body to verify the contractor's eligibility for the preference. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Short title. This act shall be known and may be cited as the "Hiring Coloradans First Act". SECTION 2. In Colorado Revised Statutes, 24-92-102, amend (6) as follows: 24-92-102. Definitions. As used in this article, unless the context otherwise requires: (6) "Low responsible bidder" means any contractor who has bid in compliance with the invitation to bid and within the requirements of the plans and specifications for a public project, who is the low bidder after any preferences allowed pursuant to this article have been applied, and who has furnished bonds or their equivalent as required by law. SECTION 3. In Colorado Revised Statutes, add 24-92-103.5 as follows: 24-92-103.5. Preferences for contractors that employ Colorado residents - definitions. (1) For purposes of this section: (a) "Apprenticeship training program" means a program that is registered with the United States department of labor, office of apprenticeship and training. (b) "Colorado resident" means an individual whose domicile is in Colorado. (c) "Domicile" means an individual's true, fixed, and permanent home and place of habitation. It is the place where he or she intends to remain and to which he or she expects to return when he or she leaves without intending to establish a new domicile elsewhere. (d) "Health care benefits" means a health care plan provided by an employer to an employee that conforms to all requirements of federal law and regulations including, but not limited to, the "Patient Protection and Affordable Care Act", Pub.L. 111-148, as amended by the "Health Care and Education Reconciliation Act of 2010", Pub.L. 111-152, and as may be further amended, and its implementing regulations. (e) "Retirement benefits" means a pension plan or other retirement plan provided by an employer to an employee that conforms to all requirements of federal law and regulations, including, but not limited to, the "Employee Retirement Income Security Act of 1974", Pub.L. 93-406, as amended, and its implementing regulations, and that does not require a greater monetary contribution from an employee than it does from the employer. (2) An agency of government that issues an invitation for bids on or after July 1, 2012, for a construction contract for a public project for which appropriation or expenditure of moneys is reasonably expected to exceed one million dollars in the aggregate shall provide one or more preferences to a contractor that responds to the invitation for bids as follows: (a) The agency shall subtract an amount equal to three percent of the bid price from the bid of each contractor that certifies that at least ninety percent of the employees who will perform the requirements of the contract are Colorado residents; (b) For a contractor that is allowed a preference pursuant to paragraph (a) of this subsection (2), the agency shall subtract an additional amount equal to one percent of the bid price from the contractor's bid if the contractor certifies that it offers health care benefits and retirement benefits to all of the employees who will perform the requirements of the contract; and (c) For a contractor that is allowed a preference pursuant to paragraph (a) of this subsection (2), the agency shall subtract an additional amount equal to one percent of the bid price from the contractor's bid if the contractor certifies that the employees who will perform the requirements of the contract have access to an apprenticeship training program. (3) A noncompliant bidder is not eligible for the preferences allowed pursuant to subsection (2) of this section. A contractor may not use said preferences to satisfy any applicable minimum requirements of a contract. (4) A contractor that seeks to have a preference specified in subsection (2) of this section allowed for a bid shall certify its eligibility for the preference to the agency of government that issued the invitation for bids. The agency may rely on the certification but may also require the contractor to submit substantiating documentation or other information that will enable the agency to verify that the contractor is eligible for the preference. (5) The executive director of the department of personnel shall promulgate rules for the administration of this section, including a process for a contractor to certify its eligibility for a preference allowed pursuant to subsection (2) of this section and a process by which an agency of government may verify such a certification. The executive director shall promulgate rules pursuant to the "State Administrative Procedure Act", article 4 of this title. (6) If the procurement officer determines that compliance with this section will cause denial of federal moneys or preclude the ability to access federal moneys that would otherwise be available or will otherwise be inconsistent with federal law, this section shall be suspended, but only to the extent necessary to prevent denial of the moneys or to eliminate the inconsistency with federal law. (7) If the requirements of this section result in increased costs for building higher education facilities, such costs shall not be passed on to students through increased tuition or fees. SECTION 4. In Colorado Revised Statutes, 24-93-106, amend (4) as follows: 24-93-106. Requests for proposals - evaluation and award of integrated project delivery contracts. (4) After obtaining and evaluating proposals according to the criteria and procedures set forth in the request for proposals in accordance with the requirements specified in subsection (1) of this section and after applying any preference allowed pursuant to section 24-93-109, an agency may accept the proposal that, in its estimation, represents the best value to the agency. Acceptance of a proposal shall be by written notice to the participating entity that submitted the accepted proposal. SECTION 5. In Colorado Revised Statues, add 24-93-109 as follows: 24-93-109. Preferences for participating entities that employ Colorado residents - definitions. (1) For purposes of this section: (a) "Colorado resident" means an individual whose domicile is in Colorado. (b) "Domicile" means an individual's true, fixed, and permanent home and place of habitation. It is the place where he or she intends to remain and to which he or she expects to return when he or she leaves without intending to establish a new domicile elsewhere. (c) "Health care benefits" means a health care plan provided by an employer to an employee that conforms to all requirements of federal law and regulations including, but not limited to, the "Patient Protection and Affordable Care Act", Pub.L. 111-148, as amended by the "Health Care and Education Reconciliation Act of 2010", Pub.L. 111-152, and as may be further amended, and its implementing regulations. (d) "Retirement benefits" means a pension plan or other retirement plan provided by an employer to an employee that conforms to all requirements of federal law and regulations, including, but not limited to, the "Employee Retirement Income Security Act of 1974", Pub.L. 93-406, as amended, and its implementing regulations, and that does not require a greater monetary contribution from the employee than it does from the employer. (2) An agency that issues a request for proposals on or after July 1, 2012, for an IPD contract for a public project for which appropriation or expenditure of moneys is reasonably expected to exceed one million dollars in the aggregate shall provide one or more preferences to a participating entity that responds to the request for proposals as follows: (a) The agency shall assign a relative weight of three percent to a participating entity that certifies that at least ninety percent of the employees who will perform the requirements of the contract are Colorado residents; and (b) For a participating entity that is allowed a preference pursuant to paragraph (a) of this subsection (2), the agency shall assign a relative weight of an additional two percent to the participating entity if the participating entity certifies that it offers health care benefits and retirement benefits to all of the employees who will perform the requirements of the contract. (3) A noncompliant participating entity is not eligible for the preferences allowed pursuant to subsection (2) of this section. A participating entity may not use said preferences to satisfy any applicable minimum requirements of a contract. (4) A participating entity that seeks to have a preference specified in subsection (2) of this section allowed for a bid shall certify its eligibility for the preference to the agency that issued the request for proposals. The agency may rely on the certification but may also require the participating entity to submit substantiating documentation or other information that will enable the agency to verify that the participating entity is eligible for the preference. (5) The executive director of the department of personnel shall promulgate rules for the administration of this section, including a process for a participating entity to certify its eligibility for a preference allowed pursuant to subsection (2) of this section and a process by which an agency of government may verify such a certification. The executive director shall promulgate rules pursuant to the "State Administrative Procedure Act", article 4 of this title. (6) If the procurement officer determines that compliance with this section will cause denial of federal moneys or preclude the ability to access federal moneys that would otherwise be available or will otherwise be inconsistent with federal law, this section shall be suspended, but only to the extent necessary to prevent denial of the moneys or to eliminate the inconsistency with federal law. (7) If the requirements of this section result in increased costs for building higher education facilities, such costs shall not be passed on to students through increased tuition or fees. SECTION 6. In Colorado Revised Statutes, 24-103-101, amend (3) as follows: 24-103-101. Definitions. As used in this article, unless the context otherwise requires: (3) "Low responsible bidder" means any person who has bid in compliance with the invitation to bid and within the requirements of the plans and specifications for a public contract who is the low bidder after any preferences allowed pursuant to this article have been applied and who has furnished bonds or their equivalent if required by law. SECTION 7. In Colorado Revised Statutes, add 24-103-210 as follows: 24-103-210. Preferences for persons that employ Colorado residents - definitions. (1) For purposes of this section: (a) "Colorado resident" means an individual whose domicile is in Colorado. (b) "Domicile" means an individual's true, fixed, and permanent home and place of habitation. It is the place where he or she intends to remain and to which he or she expects to return when he or she leaves without intending to establish a new domicile elsewhere. (c) "Health care benefits" means a health care plan provided by an employer to an employee that conforms to all requirements of federal law and regulations including, but not limited to, the "Patient Protection and Affordable Care Act", Pub.L. 111-148, as amended by the "Health Care and Education Reconciliation Act of 2010", Pub.L. 111-152, and as may be further amended, and its implementing regulations. (d) "Retirement benefits" means a pension plan or other retirement plan provided by an employer to an employee that conforms to all requirements of federal law and regulations, including, but not limited to, the "Employee Retirement Income Security Act of 1974", Pub.L. 93-406, as amended, and its implementing regulations, and that does not require a greater monetary contribution from the employee than it does from the employer. (2) A governmental body that issues an invitation for bids for a services contract on or after July 1, 2012, for which appropriation or expenditure of moneys is reasonably expected to exceed one million dollars in the aggregate shall provide one or more preferences to a person that responds to the invitation for bids as follows: (a) The governmental body shall subtract three percent of the bid price from the bid of each person that certifies that at least ninety percent of the employees who will perform the requirements of the contract are Colorado residents; and (b) For a person that is allowed a preference pursuant to paragraph (a) of this subsection (2), the governmental body shall subtract an additional amount equal to two percent of the bid price from the person's bid if the person certifies that it offers health care benefits and retirement benefits to all of the employees who will perform the requirements of the contract. (3) A governmental body that issues a request for proposals for a services contract on or after July 1, 2012, for which appropriation or expenditure of moneys is reasonably expected to exceed one million dollars in the aggregate shall provide one or more preferences to a person that responds to the request for proposals as follows: (a) The governmental body shall assign a relative weight of three percent to a person that certifies that at least ninety percent of the employees who will perform the requirements of the contract are Colorado residents; and (b) For a person that is allowed a preference pursuant to paragraph (a) of this subsection (3), the governmental body shall assign a relative weight of an additional two percent to the person if the person certifies that it offers health care benefits and retirement benefits to all of the employees who will perform the requirements of the contract. (4) A noncompliant bidder or offeror is not eligible for the preferences allowed pursuant to subsections (2) and (3) of this section. A bidder or offeror may not use said preferences to satisfy any applicable minimum requirements of a contract. (5) A person that seeks to have a preference specified in subsection (2) or (3) of this section allowed for a bid or offer shall certify its eligibility for the preference to the governmental body. The governmental body may rely on the certification but may also require the person to submit substantiating documentation or other information that the governmental body needs to verify that the person is eligible for the preference. (6) The executive director shall promulgate rules for the administration of this section, including a process for a person to certify its eligibility for a preference allowed pursuant to subsection (2) or (3) of this section and a process by which a governmental body may verify such a certification. The executive director shall promulgate rules pursuant to the "State Administrative Procedure Act", article 4 of this title. (7) If the procurement officer determines that compliance with this section will cause denial of federal moneys or preclude the ability to access federal moneys that would otherwise be available or will otherwise be inconsistent with federal law, this section shall be suspended, but only to the extent necessary to prevent denial of the moneys or to eliminate the inconsistency with federal law. (8) If the requirements of this section result in increased costs for building higher education facilities, such costs shall not be passed on to students through increased tuition or fees. SECTION 8. Appropriation. In addition to any other appropriation, there is hereby appropriated, out of any moneys in the general fund not otherwise appropriated, to the department of personnel, for the fiscal year beginning July 1, 2012, the sum of $62,767 and 0.9 FTE, or so much thereof as may be necessary, for allocation to the state purchasing office in the division of accounts and control controller for the promulgation of procurement rules related to the implementation of this act. SECTION 9. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.