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(124th General Assembly)(Amended Substitute House Bill Number 120)
AN ACT
To amend sections 125.01, 125.07, 125.08, 125.10,
and
125.11 and to enact
sections 9.314 and
125.072 of
the Revised Code to
permit
the Department of
Administrative Services
and political
subdivisions
to purchase supplies
or
services through a
competitive reverse
auction
process via
the
Internet and to make
changes in
the notice
required when the
Department
purchases
supplies
or
services by competitive
selection.
Be it enacted by the General Assembly of the State of Ohio:
SECTION 1. That sections 125.01, 125.07, 125.08, 125.10, and
125.11 be amended
and sections
9.314
and 125.072 of the Revised
Code be enacted to read as follows:
Sec. 9.314. (A) As used in this section: (1) "Contracting authority" has the same meaning as in
section 307.92
of the Revised Code. (2) "Internet" means the international computer network of
both
federal and nonfederal interoperable packet switched data
networks,
including the graphical subnetwork called the world wide
web. (3) "Political subdivision" means a municipal corporation,
township, county, school district, or other body corporate and
politic responsible for governmental activities only in geographic
areas
smaller than that of the state and also includes a
contracting authority. (4) "Reverse auction" means a purchasing process in which
offerors
submit proposals in competing to sell services or
supplies in an open
environment via the
internet. (5) "Services" means the furnishing of labor, time, or
effort by a person,
not involving the delivery of a specific end
product other than a report
which, if provided, is merely
incidental to the required performance.
"Services" does not
include services furnished pursuant to employment
agreements or
collective bargaining agreements. (6) "Supplies" means all property, including, but not
limited to,
equipment, materials, other tangible assets, and
insurance, but
excluding real property or interests in real
property. (B) Whenever any political subdivision that is
required by
law to purchase services or supplies by competitive sealed bidding
or competitive sealed proposals determines that the use of
a
reverse auction is
advantageous to the political subdivision, the
political subdivision, in accordance with this
section and rules
the political subdivision shall
adopt, may purchase services or
supplies by reverse auction. (C) A political subdivision shall solicit proposals
through
a request for proposals. The request for proposals shall state
the
relative
importance of price and other evaluation factors.
The political subdivision shall give notice of the
request for
proposals in accordance with the rules it adopts. (D) As provided in the request for proposals and in the
rules a
political subdivision adopts, and to ensure full
understanding of
and responsiveness to solicitation
requirements,
the political subdivision may conduct
discussions with responsible
offerors who submit proposals determined to
be reasonably
susceptible of being selected for award. The
political
subdivision shall accord offerors fair and
equal treatment with
respect to any opportunity for discussion
regarding any
clarification, correction, or revision of their proposals. (E) A political subdivision may award a contract
to the
offeror whose proposal the political subdivision determines
to be
the most advantageous to the political subdivision,
taking into
consideration factors such as price and the evaluation criteria
set forth in the request for proposals. The contract file shall
contain the basis on which the award is made.
(F) The rules that a political subdivision adopts under this
section may require the provision of a performance bond, or
another similar form of financial security, in the amount and in
the form specified in the rules. Sec. 125.01. As used in this chapter: (A) "Order" means a copy of a contract or a statement of
the
nature of a contemplated expenditure, a description of the
property or supplies to be purchased or service to be performed,
other than a service performed by officers and regular employees
of the state, and per diem of the national guard, and the total
sum of the expenditure to be made therefor, if the sum is fixed
and ascertained, otherwise the estimated sum thereof, and an
authorization to pay for the contemplated expenditure, signed by
the person
instructed and authorized to pay upon receipt of a
proper invoice. (B) "Invoice" means an itemized listing showing delivery of
the supplies or
performance of the service described in the
order,
and the date of the purchase or rendering of the service,
or an
itemization of the things done, material supplied, or labor
furnished, and the sum due pursuant to the contract or
obligation. (C) "Products" means materials, manufacturer's supplies,
merchandise, goods, wares, and foodstuffs. (D) "Produced" means the manufacturing, processing, mining,
developing, and making of a thing into a new article with a
distinct character
in use through the application of input, within
the state, of Ohio products,
labor, skill, or other services.
"Produced" does not include the mere
assembling or putting
together of non-Ohio products or materials. (E) "Ohio products" means products
which
that are mined,
excavated, produced, manufactured, raised, or grown in the state
by a person where the input of Ohio products, labor, skill, or
other services constitutes no less than twenty-five per cent of
the manufactured cost. With respect to mined products, such
products shall be mined or excavated in
Ohio
this state. (F) "Purchase" means to buy, rent, lease, lease purchase,
or
otherwise acquire supplies or services. "Purchase" also
includes
all functions that pertain to the obtaining of supplies
or
services, including description of requirements, selection and
solicitation of sources, preparation and award of contracts,
all
phases of contract administration, and receipt and acceptance of
the supplies and services and payment
therefor
for them. (G) "Services" means the furnishing of labor, time, or
effort by a person, not involving the delivery of a specific end
product other than a report which, if provided, is merely
incidental to the required performance. "Services" does not
include services furnished pursuant to employment agreements or
collective bargaining agreements. (H) "Supplies" means all property, including, but not
limited to, equipment, materials,
insurance, and other tangible
assets,
and insurance, but excluding
land
real property or
a
permanent
an interest in
land
real property. (I) "Competitive selection" means
either
any of the
following procedures for making purchases: (1) Competitive sealed bidding under section 125.07 of the
Revised Code; (2) Competitive sealed proposals under section 125.071 of
the Revised
Code; (3) Reverse auctions under section 125.072 of the Revised
Code. Sec. 125.07. The department of administrative services, in
making a purchase by competitive selection pursuant to
division
(B) of section 125.05 of the Revised Code, shall give
notice in
the following manner: (A) The department shall advertise
such
the intended
purchases
by notice
sent
that is posted by mail or electronic
means
to
and
that is for the benefit of competing
persons
producing or dealing in the supplies or services to be
purchased,
including, but not limited to, the persons whose names
appear on
the appropriate list provided for in section 125.08 of
the Revised
Code. The notice may be in the form of the bid or
proposal
document or of a listing in a periodic bulletin, or in any other
form
the director of administrative services considers appropriate
to sufficiently
notify qualified competing persons of the intended
purchase
purchases. (B)
Such
The notice
required under division (A) of
this
section shall include the time and place where bids
or proposals
will be accepted and opened,
or, when bids are made in a reverse
auction, the time when bids will be accepted; the conditions under
which bids or
proposals will be received,; the terms of the
proposed
purchase,
purchases;
and an itemized list of the
supplies
or services to be
purchased and the estimated quantities
or
amounts
thereof
of them. (C) The
mailing
posting of
such notices
the notice
required
under division (A) of this section shall be completed
as follows: (1) At least fifteen calendar days prior to the scheduled
opening date,
for
competitive sealed proposals and competitive
sealed
bids;
(2) For printing contracts, a
by the number of days
determined
by
the director,
determines preceding the day when
such
the bids
or proposals will be
opened
or accepted.
(D) The department
shall also
shall maintain, in a public
place
in its office, a bulletin board upon which it shall post and
maintain a copy of
such
the notice
required under division
(A) of
this section for at least the
number of days
listed in
the
director determines under division
(C) of this
section, or, for
printing contracts, a number of days
determined by the
director,
preceding the
day of the opening
or acceptance
of
such
the bids
or
proposals.
The failure to
so
additionally post
such notices
the
notice shall
invalidate
all proceedings had and any contract
entered into
pursuant to
such
the proceedings. Sec. 125.072. (A) As used in this section: (1) "Internet" means the international computer network of
both federal
and nonfederal interoperable packet switched data
networks, including the
graphical subnetwork called the world wide
web. (2) "Reverse auction" means a purchasing process in which
offerors submit
bids in competing to sell services or
supplies in
an open environment via
the internet. (B)
Whenever the director of administrative services
determines
that the use of a reverse auction is advantageous to
the state, the director, in accordance with rules
the director
shall adopt, may purchase services or
supplies by
reverse auction. (C)
The director, by rule, may authorize a state agency that
is
authorized to purchase services or supplies directly to
purchase them by
reverse auction in the same manner as this
section and the rules adopted under this section authorize the
director to
do so. Sec. 125.08. (A) The department of administrative
services
may divide the state into purchasing districts wherein
supplies or
services are to be delivered and shall describe
such
those
districts on all applications for the notification list provided
for in this section. Any person may have that person's name and address, or the
name and
address of an agent, placed on the competitive selection
notification list of the department of administrative services by
sending to the department the person's name and address,
together
with a
list of the supplies or services described in the manner
prescribed by the department produced or dealt in by the
person
with a request for such listing, a list of the districts in which
the
person desires to participate, and
such
all other information
as the director of
administrative services may prescribe.
Whenever
such
any name
and address together with a list of the
supplies or
services
produced or dealt in is so listed, the
department shall
send
post
notice, as provided in
division (A) of
section 125.07 of
the
Revised Code,
to those
for the benefit of
the persons listed
on
the notification list
that are qualified
Ohio business
enterprises, which shall include
Ohio penal
industries as defined
by rule of the director of
administrative
services, or have a
significant Ohio presence in
this state's
economy, except that, in
those circumstances in which
the director
considers it in the best
interest of this state, the
director
shall post notice
shall be
sent to,
as
provided in division (A)
of section 125.07 of the
Revised Code, for the benefit
of all
persons listed on the
notification
list. The department need only
provide competitive
selection
documents for a proposed contract to
persons who
specifically
request
such
the documents.
The The director may remove a person from
the notification list
and place the person on an inactive list if
the person fails to
respond to any notices of proposed purchases
that appear in four
consecutive bulletins or other forms of
notification that list
such
those
notices. Upon written request to the director by the
person so
removed, the director may return the person to the
notification
list if the person provides sufficient evidence
regarding intent to offer
bids or proposals to the state. The
director shall not remove any person
from the list without notice
to
such
the person. The notice may
be a part of the
notices of
proposed purchase. (B) Any person who is certified by the equal employment
opportunity coordinator of the department of administrative
services in accordance with the rules adopted under division
(B)(1) of section 123.151 of the Revised Code as a minority
business enterprise may have that person's name placed on a
special minority business enterprise notification list to be used
in
connection with contracts awarded under section 125.081 of the
Revised Code. The minority business enterprise notification list
shall be used for bidding on contracts set aside for minority
business enterprises only. In all other respects, the list shall
be maintained and used in the same manner and according to the
same procedures as the notification list provided for under
division (A) of this section, except that a firm shall not be
removed from the list unless the coordinator determines that the
firm is no longer a minority business enterprise. A minority
business enterprise may have its name placed on both the
notification lists provided for in this section. (C) The director of administrative services may require an
annual
registration fee for the listings provided for in division
(A) or (B) of
this
section. This fee shall not be more than ten
dollars. The department may
charge a fee for any compilation of
descriptions of supplies or services.
This fee
shall be
reasonable and shall not exceed
the cost required to maintain the
notification lists and provide for
the distribution of the
proposed purchase to the persons whose names appear on
the lists. Sec. 125.10.
(A) The department of administrative services
may
require that all
competitive sealed bids
and, competitive
sealed
proposals,
and bids received in a reverse
auction be
accompanied by a performance bond or other cash surety
acceptable
to the
director of administrative services, in
such
the
sum and
with
such
the sureties
as
it prescribes, payable to the
state, and
conditioned that
the person submitting the bid or
proposal, if
that
person's bid
or proposal is accepted, will
faithfully execute
the terms of the
contract and promptly
make
deliveries of the
supplies
or equipment, or contracts of
insurance,
purchased.
A (B)
A sealed copy of each
competitive sealed bid or
competitive sealed proposal shall be filed with the
department
prior
to the time specified in the notice for opening of the bids
or proposals. All
competitive sealed
bids and
competitive sealed
proposals shall
be publicly opened in the office of the department
at the time specified in
the notice. A representative of the
auditor of state shall be present at the
opening of all
competitive sealed bids and
competitive sealed
proposals,
and
shall
certify the opening of each
competitive sealed
bid and
competitive
sealed proposal, and no. No competitive sealed
bid or
competitive
sealed proposal shall
be considered valid unless it is
so
certified. Sec. 125.11. (A) Subject to division (B) of this
section,
contracts
required to be awarded pursuant to
a reverse auction
under section 125.072 of the Revised Code or pursuant to
competitive
sealed
bidding, including
such contracts awarded under
section
125.081 of
the Revised Code, shall be awarded to the
lowest
responsive and
responsible bidder on each item in
accordance with
section 9.312
of the Revised Code. When the
contract is for meat
products as
defined in section 918.01 of the
Revised Code or
poultry products
as defined in section 918.21 of
the Revised
Code, only those bids
received from vendors offering
products from
establishments on the
current list
of meat and
poultry vendors established and
maintained by the
director of
administrative services under
section 125.17 of the
Revised Code
shall be eligible for
acceptance. The department of
administrative services may accept
or reject any or all bids in
whole or by items, except that when
the contract is for services
or
supplies
products available from a
qualified nonprofit agency
pursuant to
sections 4115.31 to 4115.35
of the Revised Code, the
contract
shall be awarded to that agency. (B) Prior to awarding a contract under division (A) of
this
section, the department of administrative services or the
state
agency responsible for evaluating a contract for the
purchase of
goods
products shall evaluate the bids received
according to
the
criteria and procedures established pursuant to divisions
(C)(1)
and (2) of section 125.09 of the Revised Code for
determining if a
product is produced or mined in the United
States and if a product
is
produced or mined in
Ohio
this state. The
department or other
state agency shall first remove bids that offer
supplies
products
that have not been or that will not be
produced or mined in
the
United States. From among the remaining bids, the department
or
other state agency shall select the lowest responsive and
responsible bid, in
accordance with section 9.312 of the Revised
Code, from among the
bids that offer
goods
products that
have been
produced or
mined in
Ohio
this state
where sufficient
competition
can be generated within
Ohio
this
state to
ensure that
compliance
with these requirements will not result in
an excessive
price for
the product or acquiring a
disproportionately inferior
product.
If
there are two or more
qualified bids that offer
goods
which
products that have been produced or mined
in
Ohio
this state, it
shall be deemed that
there is sufficient competition
to prevent an
excessive price for the product or the acquiring of
a
disproportionately inferior product. (C) Division (B) of this section applies to contracts for
which competitive bidding is waived by the controlling board. (D) Division (B) of this section does not apply to
the
purchase by the division of liquor control of
spirituous
liquor. (E) The director of administrative services shall publish
in
the form of a model act for use by counties, townships,
and
municipal corporations, or any other political subdivision
described in
division (B) of section 125.04 of the Revised Code, a
system of preferences
for products
mined and
produced in
Ohio
this
state and in the United States and for
Ohio-based
contractors.
The
model act shall reflect substantial
equivalence
to the system
of
preferences in purchasing and public
improvement
contracting
procedures under which the state operates
pursuant to
this chapter
and section 153.012 of the Revised Code. To the
maximum extent
possible, consistent with the Ohio system
of
preferences in
purchasing and public improvement contracting
procedures, the
model act shall incorporate all of the
requirements of the federal
"Buy America Act," 47 Stat. 1520
(1933), 41 U.S.C. 10a to 10d, as
amended, and the rules adopted
thereunder
under that act. Prior to
Before and during the development and promulgation
of
the
model act, the director shall consult with appropriate
statewide
organizations representing counties, townships, and
municipal
corporations so as to identify the special requirements
and
concerns these political subdivisions have in their purchasing
and public improvement contracting procedures. The director
shall
promulgate the model act by rule adopted pursuant to
Chapter 119.
of the Revised Code and shall revise the act as
necessary to
reflect changes in this chapter or section 153.012
of the Revised
Code.
The director shall make available copies of the model act,
supporting information, and technical assistance to any township,
county, or municipal corporation wishing to incorporate the
provisions of the act into its purchasing or public improvement
contracting procedure. SECTION 2. That existing sections 125.01, 125.07, 125.08,
125.10, and 125.11
of the Revised Code
are hereby repealed.
SECTION 3. Not later than twelve months after the effective
date of this act, the Department of Administrative Services shall
report to the committees of the House of Representatives and
Senate with jurisdiction over legislation dealing with state
purchasing regarding the effect of reverse auctions on purchases
from Ohio businesses, including minority and female business enterprises.
SECTION 4. Section 125.11 of the Revised Code is presented
in
this act
as a composite of the section as amended by both
Am.
Sub.
S.B. 99 and Am. Sub. S.B. 162 of the 121st General Assembly.
The
General Assembly, applying the
principle stated in division
(B) of
section 1.52 of the Revised
Code that amendments are to be
harmonized if reasonably capable of
simultaneous operation, finds
that the composite is the resulting
version of the section in
effect prior to the effective date of
the section as presented in
this act.
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