HB-5639, As Passed Senate, December 18, 2008

SENATE SUBSTITUTE FOR

HOUSE BILL NO. 5639

A bill to amend 1976 PA 451, entitled

"The revised school code,"

by amending sections 623a, 1267, and 1274 (MCL 380.623a, 380.1267,

and 380.1274), section 623a as amended by 2007 PA 45, section 1267

as amended by 2004 PA 232, and section 1274 as amended by 2004 PA

588.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 623a. (1) An intermediate school board shall adopt

written policies governing the procurement of supplies, materials,

and equipment.

(2) Except as otherwise provided in subsection ~~(3)~~ (4) or (5),

an intermediate school district shall not purchase an item or a

group of items purchased in a single transaction costing ~~$19,211.00~~

$20,959.00 or more unless competitive bids are obtained for those

items and the purchase of those items is approved by the

intermediate school board. The maximum amount specified in this

section shall be adjusted each year by multiplying the amount for

the immediately preceding year by the percentage by which the

average consumer price index for all items for the 12 months ending

August 31 of the year in which the adjustment is made differs from

that index's average for the 12 months ending on August 31 of the

immediately preceding year and adding that product to the maximum

amount that applied in the immediately preceding year, rounding to

the nearest whole dollar.

(3) The intermediate school board of an intermediate school

district may adopt and implement a local policy that gives a

preference to a Michigan-based business in awarding a contract

under this section. The policy may provide for a preference based

on the status of the primary contractor as a Michigan-based

business or based on the status of 1 or more subcontractors of the

primary contractor as Michigan-based businesses, or both. A policy

adopted under this subsection shall be consistent with federal

statutes and regulations and shall not be applied to a contract

that is to be paid with federal funds. Upon request by an

intermediate school district that has adopted and implemented a

policy described in this subsection, the department of treasury

shall disclose to that intermediate school district verifying

information as described in section 268(3) of the management and

budget act, 1984 PA 431, MCL 18.1268. The adoption, implementation,

or application of a policy described in this subsection, or a

decision not to adopt, implement, or apply such a policy, does not

House Bill No. 5639 as amended December 18, 2008

create a cause of action << >>.

(4) ~~(3)~~ An intermediate school district is not required to

obtain competitive bids for items purchased through the cooperative

bulk purchasing program operated by the department of management

and budget under section 263(3) of the management and budget act,

1984 PA 431, MCL 18.1263.

(5) An intermediate school district is not required to obtain

competitive bids for purchasing food unless the food is purchased

in a single transaction costing $100,000.00 or more.

(6) ~~(4)~~ The intermediate school board of an intermediate

school district may acquire by purchase, lease, or rental, with or

without option to purchase, equipment necessary for the operation

of intermediate school district programs, including, but not

limited to, heating, water heating, and cooking equipment for

school buildings, and may pay for the equipment from operating

funds of the intermediate school district. Heating and cooking

equipment may be purchased on a title retaining contract or other

form of agreement creating a security interest and pledging in

payment money in the general fund or funds received from state

school aid. The contracts may extend for not more than 10 years.

(7) As used in this section, "Michigan-based business" means a

business that would qualify for a preference in a procurement

contract with this state as determined under section 268 of the

management and budget act, 1984 PA 431, MCL 18.1268.

Sec. 1267. (1) Before commencing construction of a new school

building, or addition to or repair or renovation of an existing

school building, except repair in emergency situations, the board

of a school district or intermediate school district or board of

directors of a public school academy, shall obtain competitive bids

on all the material and labor required for the complete

construction of a proposed new building or addition to or repair or

renovation of an existing school building.

(2) The board, intermediate school board, or board of

directors shall advertise for the bids required under subsection

(1) by placing an advertisement for bids at least once in a

newspaper of general circulation in the area where the building or

addition is to be constructed or where the repair or renovation of

an existing building is to take place and by posting an

advertisement for bids for at least 2 weeks on the department of

management and budget website on a page on the website maintained

for this purpose or on a website maintained by a school

organization and designated by the department of management and

budget for this purpose. If the department of management and budget

designates a school organization website for this purpose, the

department of management and budget shall indicate this fact on its

website and include a link on its website to the school

organization website.

(3) The advertisement for bids shall do all of the following:

(a) Specify the date and time by which all bids must be

received by the board, intermediate school board, or board of

directors.

(b) State that the board, intermediate school board, or board

of directors will not consider or accept a bid received by the

board, intermediate school board, or board of directors after the

date and time specified for bid submission.

which the board, intermediate school board, or board of directors

or its designee will open and read aloud each bid received by the

board, intermediate school board, or board of directors by the date

and time specified in subdivision (a).

(d) State that the bid shall be accompanied by a sworn and

notarized statement disclosing any familial relationship that

exists between the owner or any employee of the bidder and any

member of the board, intermediate school board, or board of

directors or the superintendent of the school district,

intermediate superintendent of the intermediate school district, or

chief executive officer of the public school academy. A board,

intermediate school board, or board of directors shall not accept a

bid that does not include this sworn and notarized disclosure

statement.

(4) The board, intermediate school board, or board of

directors shall require each bidder for a contract under this

section to file with the board, intermediate school board, or board

of directors security in an amount not less than 1/20 of the amount

of the bid conditioned to secure the school district from loss or

damage by reason of the withdrawal of the bid or by the failure of

the bidder to enter a contract for performance, if the bid is

accepted by the board, intermediate school board, or board of

directors.

(5) The board, intermediate school board, or board of

directors shall not open, consider, or accept a bid that the board,

intermediate school board, or board of directors receives after the

date and time specified for bid submission in the advertisement for

bids described in subsection (3).

(6) At a public meeting identified in the advertisement for

bids described in subsection (3), the board, intermediate school

board, or board of directors or its designee shall open and read

aloud each bid that the board, intermediate school board, or board

of directors received at or before the time and date for bid

submission specified in the advertisement for bids. The board,

intermediate school board, or board of directors may reject any or

all bids, and if all bids are rejected, shall readvertise in the

manner required by this section.

(7) The board of a school district or intermediate school

district or board of directors of a public school academy may adopt

and implement a local policy that gives a preference to a Michigan-

based business in awarding a contract under this section. The

policy may provide for a preference based on the status of the

primary contractor as a Michigan-based business or based on the

status of 1 or more subcontractors of the primary contractor as

Michigan-based businesses, or both. A policy adopted under this

subsection shall be consistent with federal statutes and

regulations and shall not be applied to a contract that is to be

paid with federal funds. Upon request by a school district,

intermediate school district, or public school academy that has

adopted and implemented a policy described in this subsection, the

department of treasury shall disclose to that school district,

intermediate school district, or public school academy verifying

House Bill No. 5639 as amended December 18, 2008

information as described in section 268(3) of the management and

budget act, 1984 PA 431, MCL 18.1268. The adoption, implementation,

or application of a policy described in this subsection, or a

decision not to adopt, implement, or apply such a policy, does not

create a cause of action << >>.

(8) ~~(7)~~ This section does not apply to buildings, renovations,

or repairs costing less than ~~$17,932.00~~ $20,959.00 or to repair

work normally performed by school district, intermediate school

board, or public school academy employees. The maximum amount

specified in this subsection shall be adjusted each year by

multiplying the amount for the immediately preceding year by the

percentage by which the average consumer price index for all items

for the 12 months ending August 31 of the year in which the

adjustment is made differs from that index's average for the 12

months ending on August 31 of the immediately preceding year and

adding that product to the maximum amount that applied in the

immediately preceding year, rounding to the nearest whole dollar.

(9) As used in this section, "Michigan-based business" means a

business that would qualify for a preference in a procurement

contract with this state under section 268 of the management and

budget act, 1984 PA 431, MCL 18.1268.

Sec. 1274. (1) The board of a school district or board of

directors of a public school academy shall adopt written policies

governing the procurement of supplies, materials, and equipment.

(2) Except as otherwise provided in subsection ~~(3)~~ (4) or (5),

a school district or public school academy shall not purchase an

item or a group of items in a single transaction costing ~~$17,932.00~~

$20,959.00 or more unless competitive bids are obtained for those

items and the purchase of those items is approved by the school

board or board of directors. The maximum amount specified in this

subsection shall be adjusted each year by multiplying the amount

for the immediately preceding year by the percentage by which the

average consumer price index for all items for the 12 months ending

August 31 of the year in which the adjustment is made differs from

that index's average for the 12 months ending on August 31 of the

immediately preceding year and adding that product to the maximum

amount that applied in the immediately preceding year, rounding to

the nearest whole dollar.

(3) The board of a school district or board of directors of a

public school academy may adopt and implement a local policy that

gives a preference to a Michigan-based business in awarding a

contract under this section. The policy may provide for a

preference based on the status of the primary contractor as a

Michigan-based business or based on the status of 1 or more

subcontractors of the primary contractor as Michigan-based

businesses, or both. A policy adopted under this subsection shall

be consistent with federal statutes and regulations and shall not

be applied to a contract that is to be paid with federal funds.

Upon request by a school district or public school academy that has

adopted and implemented a policy described in this subsection, the

department of treasury shall disclose to that school district or

public school academy verifying information as described in section

268(3) of the management and budget act, 1984 PA 431, MCL 18.1268.

The adoption, implementation, or application of a policy described

House Bill No. 5639 as amended December 18, 2008

in this subsection, or a decision not to adopt, implement, or apply

such a policy, does not create a cause of action << >>.

(4) ~~(3)~~ A school district or public school academy is not

required to obtain competitive bids for items purchased through the

cooperative bulk purchasing program operated by the department of

management and budget under section 263(3) of the management and

budget act, 1984 PA 431, MCL 18.1263.

(5) A school district or public school academy is not required

to obtain competitive bids for purchasing food unless the food is

purchased in a single transaction costing $100,000.00 or more.

(6) ~~(4)~~ The board of a school district or local act school

district or board of directors of a public school academy may

acquire by purchase, lease, or rental, with or without option to

purchase, equipment necessary for the operation of the school

program, including, but not limited to, heating, water heating, and

cooking equipment for school buildings, and may pay for the

equipment from operating funds of the district or public school

academy. Heating and cooking equipment may be purchased on a title

retaining contract or other form of agreement creating a security

interest and pledging in payment money in the general fund or funds

received from state school aid. The contracts may extend for not

more than 10 years.

(7) As used in this section, "Michigan-based business" means a

business that would qualify for a preference in a procurement

contract with this state as determined under section 268 of the

management and budget act, 1984 PA 431, MCL 18.1268.