2014 -- H 7074

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LC003339

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO PUBLIC PROPERTY AND WORKS

     Introduced By: Representatives Fellela, Gallison, Azzinaro, McLaughlin, and Messier

     Date Introduced: January 14, 2014

     Referred To: House Small Business

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 37 of the General Laws entitled "PUBLIC PROPERTY AND

WORKS" is hereby amended by adding thereto the following chapter:

CHAPTER 2.5

VETERAN-OWNED BUSINESS ENTERPRISES

     37-14.2-1. Purpose. -- The purposes of this chapter are to honor the courageous members

of the military for their service and to assist them by increasing opportunities for active duty and

veteran-owned small businesses to participate in state agency contracts and subcontracts, and to

carry out the state's policy of supporting the fullest possible participation of firms owned and

controlled by individuals actively serving or veterans in state funded and state directed public

construction programs and projects and in state purchases of goods and services. This includes

assisting such businesses throughout the life of the contracts in which they participate.

     37-14.2-2. Applicability. -- This chapter shall apply to any and all state purchasing,

including, but not limited to, the procurement of goods, services, construction projects, or

contracts funded in whole or in part by state funds, or funds which, in accordance with a federal

grant or otherwise, the state expends or administers or in which the state is a signatory to the

construction contract.

     37-14.2-3. Definitions. -- (a) "Compliance" means the condition existing when a

contractor has met and implemented the requirements of this chapter.

     (b) "Contract" means a mutually binding legal relationship or any modification thereof

obligating the seller to furnish supplies or services, including construction, and the buyer to pay

for them. For purposes of this chapter, a lease is a contract.

     (c) "Contractor" means one who participates, through a contract or subcontract, in any

procurement or program covered by this chapter and includes lessees and material suppliers.

     (d) "Veteran" shall mean all forms of military service members that are defined in chapter

30-22 of the general laws.

     (e) "Veteran-owned small business enterprise" means a business that has been verified by

the United States department of veterans' affairs in accordance with 38 CFR part 74, and may

include a business owned by a surviving spouse or permanent caregiver of a veteran as provided

by 38 CFR part 74.

     (f) "Noncompliance" means the condition existing when a recipient or contractor has

failed to implement the requirements of this chapter.

     37-14.2-4. Veteran-owned small business enterprise participation. -- The state annual

goal for veteran-owned small business enterprises to participate in state contracts shall be no less

than three percent (3%) of the total value of all contracts available to businesses in each fiscal

year. In order to achieve this goal veteran-owned small business enterprises shall be included in

all procurements and construction projects under this chapter and shall be awarded a minimum of

three percent (3%) of the dollar value of the entire procurement or project. The director of the

department of administration is further authorized to establish by rules and regulation formulas

for giving veteran-owned small business enterprises a preference in contract and subcontract

awards.

     37-14.2-5. Establishment of criteria, guidelines and certification. -- (a) The director of

the department of administration shall, in consultation with the division of veterans' affairs

establish, by rules and regulations adopted in accordance with chapter 35 of title 42, standards

which shall determine whether a construction project is covered by this chapter, compliance

formulas, procedures for implementation, and procedures for enforcement which are not

inconsistent with 49 CFR 23 of the federal regulations. As to Rhode Island department of

transportation contracts, the director of administration may delegate this authority to the director

of transportation.

     (b) The director of the department of administration may establish additional criteria to

certify veteran-owned small business enterprises and maintain and update publicly accessible lists

of veteran-owned small business enterprises that are certified by the department.

     37-14.2-6. Sanctions. -- (a) The director of the department of administration shall have

the power to impose sanctions upon contractors not in compliance with this chapter and shall

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include, but not be limited to:

     (1) Suspension of payments;

     (2) Termination of the contract;

     (3) Recovery by the state of ten percent (10%) of the contract award price as liquidated

damages; and

     (4) Denial of right to participate in future projects for up to three (3) years.

     (b) As to Rhode Island department of transportation contracts, the director of the

department of administration may delegate this authority to the director of transportation.

     37-14.2-7. Reporting. -- By August 1, 2015 and each August 1 thereafter, the department

of administration shall submit an annual report to the governor, speaker of the house, senate

president and associate director of veterans' affairs for the period from July 1 to June 30 on the

actual utilization of veteran-owned small business enterprises as contractors, subcontractors,

suppliers and professional service providers for the state. The annual report shall include a list of

all veteran-owned small businesses that participated as contractors, subcontractors, suppliers and

professional service providers for the state during the previous fiscal year.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PUBLIC PROPERTY AND WORKS

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     This act would create a veteran's preference in the issuance of state contracts.

     This act would take effect upon passage.

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