HB-4560, As Passed House, January 16, 2008

SUBSTITUTE FOR

HOUSE BILL NO. 4560

     A bill to amend 1984 PA 431, entitled

"The management and budget act,"

by amending section 263 (MCL 18.1263), as amended by 2004 PA 589.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

     Sec. 263. (1) The director may authorize a state agency to

purchase supplies and materials for the purpose of maintaining

inventories. The director shall place a dollar or quantity

limitation to insure inventories are maintained at acceptable

levels. Appropriation accounts shall be charged upon the basis of

actual usage. Any state agency so authorized shall conduct periodic

inventories as directed by the director of all supplies and

materials under their control. Obsolete, damaged, or spoiled

supplies and materials shall be charged to the proper appropriation

House Bill No. 4560 (H-3) as amended January 16, 2008

account during the fiscal year it is determined that obsolescence,

damage, or spoilage has occurred.

     (2) The department shall provide assistance to any city,

village, county, township, school district, intermediate school

district, nonprofit hospital, institution of higher education, or

community or junior college, or small business for purchasing

services on a fee basis. Fees collected for the provision of that

assistance are appropriated for the additional expenses incurred.

     (3) The department shall create and operate a cooperative bulk

purchasing program for school districts, public school academies,

nonpublic schools, and intermediate school districts, and small

businesses on a fee basis to reduce the costs of purchasing goods

and services. Fees collected under this subsection shall not exceed

the cost of purchasing goods and services and reasonable

administrative expenses, and are appropriated for the expenses

incurred.

     (4) A vendor who has a contract to supply goods or services to

this state under the cooperative bulk purchasing program described

in this section is not required to provide those goods or services

under that contract to a small business.

     (5) As used in this section, "small business" means a business

concern formed or doing business in this state, including the

affiliates of the business concern, which is independently owned

and operated and which employs fewer than 30 employees and which

has gross annual sales of less than $1,000,000.00.

[(6) whenever the department receives bids for the program from

 michigan-based vendors and out-of-state vendors that offer equal or comparable services, the department shall award the contract to the michigan-based vendor, provided that the michigan-based vendor's bid is equal to or lower than that of any out-of-state vendor's bid.]