Bill > S1397

Introduced Session

This bill establishes requirements and procedures regarding privatization contracts between State agencies and private business entities under which the business entities provide services substantially similar to services provided by State agency employees. The bill requires that any State agency, before soliciting bids or proposals for a privatization contract or its renewal or extension, prepare and make available to the public a statement describing: contract requirements; procedures for awarding the contract; services subject to the contract; the wages and benefits of the agency employees performing the work; and the anticipated net reduction of in-house costs. The bill requires the agency, upon selecting a contractor for any privatization contract with a total value of more than $250,000, but before making a final award of the contract, to prepare a cost analysis of the contract and certification that the contract complies with the requirements of the bill. The agency is required to make the cost analysis and certification available to the public, the State Auditor and affected employee organizations. The Speaker of the General Assembly, the President of the Senate or affected employee organization representative or member of the public may, not more than 15 days after the certification and cost analysis are made available, submit comments to the agency and the State Auditor and request a public hearing. The State Auditor is required to review the certification and perform an audit of the agency's calculations and report its own determination of the aggregate cost savings, if any, with respect to the contract. The bill requires that for any privatization contract with a total value of more than $250,000: 1. The contract results in substantial aggregate cost savings not outweighed by the public's interest in having the service performed directly by the State; 2. Displaced State workers are given a right of first refusal for the jobs under the contract, or training and other assistance if they choose not to work under the contract; 3. The contactor provides workers under the contract with benefits and a rate of pay not less than that provided to State employees performing the work; 4. The contracted service is the same as that performed by State employees in lieu of the privatization contract, there is no increase in charges to the public and staffing levels are maintained at the level needed to sustain the quality of the service; 5. The contractor, its subsidiaries and affiliates, and its managerial and supervisory employees have not been subject to debarment, suspension, adjudication or conviction during the 10-year period before the awarding of the contract or any criminal conviction at any time and no principal or management employee of the contractor worked in the preceding four years for the State in any capacity related to work under the contract; 6. The contractor discloses every suit involving it or its subsidiaries or affiliates, and every report regarding the contractor's ability to comply with the contract, and provides copies of all requested union contracts, personnel manuals, and documents describing fringe benefits, that cover its employees; 7. The contract has a term of not more than three years and states the contractor's liability for damages arising out of contractor noncompliance, theft, damage, negligence or inability of the contractor to perform; 8. The contractor's practices meet all applicable nondiscrimination and affirmative action standards and the contract has no significant adverse effect on State affirmative action efforts; 9. For any privatization contract to perform development work on an information technology-based system, the contractor involves State employees in the work to ensure, as much as practical, that their skills are upgraded enough to permit them to operate and maintain the system and perform future development work; and 10. The contract is in conformance with the provisions of any applicable collective bargaining agreement and subject to the provisions of any employee protection arrangement established under 49 U.S.C. 5333(b). The bill requires the State Auditor to conduct annual post audits of each privatization contract with a total value of more than $250,000 and issue a report which includes evaluations of any actual net reduction of in-house costs, the actual entire cost of the contract and any actual aggregate cost savings of the contract, and a review of the compliance of the agency and the contractor with the requirements of the bill.

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Shirley Turner (D)*, 

Introduced in the Senate, Referred to Senate State Government, Wagering, Tourism & Historic Preservation Committee (on 02/10/2022)

Official Document