ASSEMBLY, No. 1645
STATE OF NEW JERSEY
PRE-FILED FOR INTRODUCTION IN THE 2008 SESSION
Assemblyman JOHN F. MCKEON
District 27 (Essex)
Assemblyman FREDERICK SCALERA
District 36 (Bergen, Essex and Passaic)
Assemblyman VINCENT PRIETO
District 32 (Bergen and Hudson)
Assemblywoman Vandervalk, Assemblymen Cryan, Giblin and Assemblywoman Vainieri Huttle
Redefines role and qualifications of purchasing agent in "Local Public Contracts Law."
CURRENT VERSION OF TEXT
As reported by the Assembly Housing and Local Government Committee on January 24, 2008, with amendments.
An Act concerning public contracts and amending P.L.1971, c.198.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 2 of P.L.1971, c.198 (C.40A:11-2) is amended to read as follows:
2. As used herein the following words have the following definitions, unless the context otherwise indicates:
(1) “Contracting unit” means:
(a) Any county; or
(b) Any municipality; or
(c) Any board, commission, committee, authority or agency, which is not a State board, commission, committee, authority or agency, and which has administrative jurisdiction over any district other than a school district, project, or facility, included or operating in whole or in part, within the territorial boundaries of any county or municipality which exercises functions which are appropriate for the exercise by one or more units of local government, and which has statutory power to make purchases and enter into contracts awarded by a contracting agent for the provision or performance of goods or services.
The term shall not include a private firm that has entered into a contract with a public entity for the provision of water supply services pursuant to P.L.1995, c.101 (C.58:26-19 et al.).
“Contracting unit” shall not include a private firm or public authority that has entered into a contract with a public entity for the provision of wastewater treatment services pursuant to P.L.1995, c.216 (C.58:27-19 et al.).
“Contracting unit” shall not include a duly incorporated nonprofit association that has entered into a contract with the governing body of a city of the first class for the provision of water supply services or wastewater treatment services pursuant to section 2 of P.L.2002, c.47 (C.40A:11-5.1).
(2) “Governing body” means:
(a) The governing body of the county, when the purchase is to be made or the contract or agreement is to be entered into by, or in behalf of, a county; or
(b) The governing body of the municipality, when the purchase is to be made or the contract or agreement is to be entered into by, or on behalf of, a municipality; or
(c) Any board, commission, committee, authority or agency of the character described in subsection (1) (c) of this section.
(3) “Contracting agent” means the governing body of a contracting unit, or its authorized designee, which has the power to prepare the advertisements, to advertise for and receive bids and, as permitted by this act, to make awards for the contracting unit in connection with purchases, contracts or agreements.
(4) “Purchase” means a transaction, for a valuable consideration, creating or acquiring an interest in goods, services and property, except real property or any interest therein.
(5) (Deleted by amendment, P.L.1999, c.440.)
(6) “Professional services” means services rendered or performed by a person authorized by law to practice a recognized profession, whose practice is regulated by law, and the performance of which services requires knowledge of an advanced type in a field of learning acquired by a prolonged formal course of specialized instruction and study as distinguished from general academic instruction or apprenticeship and training. Professional services may also mean services rendered in the provision or performance of goods or services that are original and creative in character in a recognized field of artistic endeavor.
(7) “Extraordinary unspecifiable services” means services which are specialized and qualitative in nature requiring expertise, extensive training and proven reputation in the field of endeavor.
(8) (Deleted by amendment, P.L.1999, c.440.)
(9) “Work” includes services and any other activity of a tangible or intangible nature performed or assumed pursuant to a contract or agreement with a contracting unit.
(10) “Homemaker--home health services” means at home personal care and home management provided to an individual or members of the individual’s family who reside with the individual, or both, necessitated by the individual’s illness or incapacity. “Homemaker--home health services” includes, but is not limited to, the services of a trained homemaker.
(11) “Recyclable material” means those materials which would otherwise become municipal solid waste, and which may be collected, separated or processed and returned to the economic mainstream in the form of raw materials or products.
(12) “Recycling” means any process by which materials which would otherwise become solid waste are collected, separated or processed and returned to the economic mainstream in the form of raw materials or products.
(13) “Marketing” means the
sale, disposition, assignment, or placement of designated recyclable materials
with, or the granting of a concession to, a reseller, processor, materials
recovery facility, or end-user of recyclable material, in accordance with a
district solid waste management plan adopted pursuant to P.L.1970, c.39 (C.13:1E-1
et seq.) and shall not include the collection of such recyclable material when
collected through a system of routes by
local government unit employees or under a contract administered by a local government unit.
(14) “Municipal solid waste” means, as appropriate to the circumstances, all residential, commercial and institutional solid waste generated within the boundaries of a municipality; or the formal collection of such solid wastes or recyclable material in any combination thereof when collected through a system of routes by local government unit employees or under a contract administered by a local government unit.
(15) “Distribution” (when used in relation to electricity) means the process of conveying electricity from a contracting unit that is a generator of electricity or a wholesale purchaser of electricity to retail customers or other end users of electricity.
(16) “Transmission” (when used in relation to electricity) means the conveyance of electricity from its point of generation to a contracting unit that purchases it on a wholesale basis for resale.
(17) “Disposition” means the transportation, placement, reuse, sale, donation, transfer or temporary storage of recyclable materials for all possible uses except for disposal as municipal solid waste.
(18) “Cooperative marketing” means the joint marketing by two or more contracting units of the source separated recyclable materials designated in a district recycling plan required pursuant to section 3 of P.L.1987, c.102 (C.13:1E-99.13) pursuant to a written cooperative agreement entered into by the participating contracting units thereof.
(19) “Aggregate” means the sums expended or to be expended for the provision or performance of any goods or services in connection with the same immediate purpose or task, or the furnishing of similar goods or services, during the same contract year through a contract awarded by a contracting agent.
(20) “Bid threshold” means the dollar amount set in section 3 of P.L.1971, c.198 (C.40A:11-3), above which a contracting unit shall advertise for and receive sealed bids in accordance with procedures set forth in P.L.1999, c.440 (C.40A:11-4.1 et al.).
(21) “Contract” means any agreement, including but not limited to a purchase order or a formal agreement, which is a legally binding relationship enforceable by law, between a vendor who agrees to provide or perform goods or services and a contracting unit which agrees to compensate a vendor, as defined by and subject to the terms and conditions of the agreement. A contract also may include an arrangement whereby a vendor compensates a contracting unit for the vendor’s right to perform a service, such as, but not limited to, operating a concession.
(22) “Contract year” means the period of 12 consecutive months following the award of a contract.
(23) “Competitive contracting” means the method described in sections 1 through 5 of P.L.1999, c.440 (C.40A:11-4.1 thru 40A:11-4.5) of contracting for specialized goods and services in which formal proposals are solicited from vendors; formal proposals are evaluated by the purchasing agent or counsel or administrator; and the governing body awards a contract to a vendor or vendors from among the formal proposals received.
(24) “Goods and services” or “goods or services” means any work, labor, commodities, equipment, materials, or supplies of any tangible or intangible nature, except real property or any interest therein, provided or performed through a contract awarded by a contracting agent, including goods and property subject to N.J.S.12A:2-101 et seq.
(25) “Library and educational goods and services” means textbooks, copyrighted materials, student produced publications and services incidental thereto, including but not limited to books, periodicals, newspapers, documents, pamphlets, photographs, reproductions, microfilms, pictorial or graphic works, musical scores, maps, charts, globes, sound recordings, slides, films, filmstrips, video and magnetic tapes, other printed or published matter and audiovisual and other materials of a similar nature, necessary binding or rebinding of library materials, and specialized computer software used as a supplement or in lieu of textbooks or reference material.
(26) “Lowest price” means the least possible amount that meets all requirements of the request of a contracting agent.
(27) “Lowest responsible bidder or vendor” means the bidder or vendor: (a) whose response to a request for bids offers the lowest price and is responsive; and (b) who is responsible.
(28) “Official newspaper” means any newspaper designated by the contracting unit pursuant to R.S.35:1-1 et seq.
(29) “Purchase order” means a document issued by the contracting agent authorizing a purchase transaction with a vendor to provide or perform goods or services to the contracting unit, which, when fulfilled in accordance with the terms and conditions of a request of a contracting agent and other provisions and procedures that may be established by the contracting unit, will result in payment by the contracting unit.
(30) a. “Purchasing agent” means the individual duly assigned the authority, responsibility, and accountability for the purchasing activity of the contracting unit, and [who has such duties as are defined by an authority appropriate to the form and structure of the contracting unit, and] administration of the contracting unit’s responsibilities, pursuant to P.L.1971, c.198 (C.40A:11-1 et seq.).
b. “Qualified Purchasing Agent” means a purchasing agent who is the holder of a qualified purchasing agent certificate issued pursuant to section 9 of P.L.1971, c.198 (C.40A:11-9).
(31) “Quotation” means the response to a formal or informal request made by a contracting agent by a vendor for provision or performance of goods or services, when the aggregate cost is less than the bid threshold. Quotations may be in writing, or taken verbally if a record is kept by the contracting agent.
(32) “Responsible” means able to complete the contract in accordance with its requirements, including but not limited to requirements pertaining to experience, moral integrity, operating capacity, financial capacity, credit, and workforce, equipment, and facilities availability.
(33) “Responsive” means conforming in all material respects to the terms and conditions, specifications, legal requirements, and other provisions of the request.
(34) “Public works” means building, altering, repairing, improving or demolishing any public structure or facility constructed or acquired by a contracting unit to house local government functions or provide water, waste disposal, power, transportation, and other public infrastructures.
(35) “Director” means the Director of the Division of Local Government Services in the Department of Community Affairs.
(36) “Administrator” means a municipal administrator appointed pursuant to N.J.S.40A:9-136 and N.J.S.40A:9-137; a business administrator, a municipal manager or a municipal administrator appointed pursuant to the “Optional Municipal Charter Law,” P.L.1950, c.210 (C.40:69A-1 et seq.); a municipal manager appointed pursuant to “the municipal manager form of government law,” R.S.40:79-1 et seq.; or the person holding responsibility for the overall operations of an authority that falls under the “Local Authorities Fiscal Control Law,” P.L.1983, c.313 (C.40A:5A-1 et seq.).
(37) “Concession” means the granting of a license or right to act for or on behalf of the contracting unit, or to provide a service requiring the approval or endorsement of the contracting unit, and which may or may not involve a payment or exchange, or provision of services by or to the contracting unit.
(38) “Index rate” means the rate of annual percentage increase, rounded to the nearest half-percent, in the Implicit Price Deflator for State and Local Government Purchases of Goods and Services, computed and published quarterly by the United States Department of Commerce, Bureau of Economic Analysis.
(39) “Proprietary” means goods or services of a specialized nature, that may be made or marketed by a person or persons having the exclusive right to make or sell them, when the need for such goods or services has been certified in writing by the governing body of the contracting unit to be necessary for the conduct of its affairs.
(40) “Service or services” means the performance of work, or the furnishing of labor, time, or effort, or any combination thereof, not involving or connected to the delivery or ownership of a specified end product or goods or a manufacturing process. Service or services may also include an arrangement in which a vendor compensates the contracting unit for the vendor’s right to operate a concession.
(cf: P.L.2002, c.47, s.7)
2. Section 3 of P.L.1971, c.198 (C.40A:11-3) is amended to read as follows:
3. a. When the cost or price of any contract awarded by the contracting agent in the aggregate does not exceed in a contract year the total sum of $17,500 1[or the threshold amount adjusted by the Governor pursuant to section c. of this section]1, the contract may be awarded by a purchasing agent when so authorized by ordinance or resolution, as appropriate to the contracting unit, of the governing body of the contracting unit without public advertising for bids, except that the governing body of any contracting unit may adopt an ordinance or resolution to set a lower threshold for the receipt of public bids or the solicitation of competitive quotations. [If the purchasing agent is qualified pursuant to subsection b. of section 9 of P.L.1971, c.198 (C.40A:11-9)] In the case of a qualified purchasing agent, the governing body of the contracting unit may establish that the bid threshold may be up to $25,000 1[or the threshold amount adjusted by the Governor pursuant to section c. of this section]1. Such authorization may be granted for each contract or by a general delegation of the power to negotiate and award such contracts pursuant to this section.
b. Any contract made pursuant to this section may be awarded for a period of 24 consecutive months, except that contracts for professional services pursuant to subparagraph (i) of paragraph (a) of subsection (1) of section 5 of P.L.1971, c.198 (C.40A:11-5) may be awarded for a period not exceeding 12 consecutive months. The Division of Local Government Services shall adopt and promulgate rules and regulations concerning the methods of accounting for all contracts that do not coincide with the contracting unit’s fiscal year.
c. The Governor, in consultation with the Department of the Treasury, shall, no later than March 1 of every fifth year beginning in the fifth year after the year in which P.L.1999, c.440 takes effect, adjust the threshold [amount] 1[amounts] amount1 and the higher threshold [amount] 1[amounts] amount1 which the governing body is permitted to establish, as set forth in subsection a. of this section, or the threshold [amount] amounts resulting from any adjustment under this subsection, in direct proportion to the rise or fall of the index rate as that term is defined in section 2 of P.L.1971, c.198 (C.40A:11-2), and shall round the adjustment to the nearest $1,000. The Governor shall, no later than June 1 of every fifth year, notify each governing body of the adjustment. The adjustment shall become effective on July 1 of the year in which it is made.
(cf: P.L.1999, c.440, s.7)
3. Section 9 of P.L.1971, c.198 (C.40A:11-9) is amended to read as follows:
9. a. The governing body of any contracting unit [may] shall by ordinance, in the case of a municipality, by ordinance or resolution, as the case may be, in the case of a county, or by resolution in all other cases, establish the office of purchasing agent [, or a purchasing department or a purchasing board,] with the authority, responsibility, and accountability as its contracting agent, for the purchasing activity for the contracting unit, to prepare public advertising for bids and to receive bids for the provision or performance of goods or services on behalf of the contracting unit and to award contracts permitted pursuant to subsection a. of section 3 of P.L.1971, c.198 (C.40A:11-3) in the name of the contracting unit, and conduct any activities as may be necessary or appropriate to the purchasing function of the contracting unit. Except as provided pursuant to subsection i of this section, the governing body of each contracting unit shall employ at least one qualified purchasing agent. The position of purchasing agent, or qualified purchasing agent, as the case may be, may be filled by a part-time or full-time employee of the contracting unit, by contract with an individual, or by an individual employed by another contracting unit through an interlocal services agreement.
b. The Director of the Division of Local Government Services, after consultation with the Commissioner of Education, shall establish criteria to qualify individuals who have completed appropriate training [and possess such purchasing experience as deemed necessary to exercise such supplemental authority as may be set forth in subsection a. of section 3 of P.L.1971, c.198 (C.40A:11-3)], and, when determined to be necessary, have passed a test certified and administered by the State pursuant to this section. These criteria also shall authorize county purchasing agents certified pursuant to P.L.1981, c.380 (C.40A:9-30.1 et seq.) to exercise such supplemental authority as may be set forth in subsection a. of section 3 of P.L.1971, c.198 (C.40A:11-3). The criteria established by the director shall include, but are not limited to, the following:
(1) is a citizen of the United States;
(2) is of good moral character;
(3) is a high school graduate or equivalent;
(4) has two years of higher education, or two years of full time governmental experience performing duties relative to those of public procurement, or a combination of the above;
(5) has successfully received certificates indicating satisfactory completion of a series of training courses in public procurement as determined by the director and provided by either the Division of Local Government Services, or, with the approval of the director, by a county college or Rutgers, The State University of New Jersey, under the supervision of instructors approved by the director;
(6) has submitted completed application forms, including proof of education and experience, as set forth in subsection c. of this section, accompanied by a fee in the amount of $50 payable to the State Treasurer, to the Director of the Division of Local Government Services at least 30 days prior to the administration of a State qualifying examination;
(7) has successfully passed a State qualifying examination. The director shall hold examinations semi-annually or at such times as the director may deem appropriate for certification of qualified purchasing agents. An individual shall be eligible to take the State qualifying examination for a qualified purchasing agent without having taken the courses required pursuant to paragraph (5) of this subsection if the individual has been certified by the division as a certified municipal finance officer, a certified county finance officer, or a certified county purchasing officer, or has been certified by the Department of Education as a school board administrator.
The director shall issue a qualified purchasing agent certificate to an individual who passes the qualifying examination upon payment to the director of a fee of $50 which shall be payable to the State Treasurer.
c. Renewal of the qualified purchasing agent certification shall be required every three years, subject to the applicant’s fulfillment of continuing education requirements, the submission of an application for renewal, and the payment of a renewal fee, all as determined by the director. In the event that an individual holding a qualified purchasing agent certificate allows the certificate to lapse by failing to renew the certificate, the individual shall be required to apply to take the qualifying examination required pursuant to subsection b. of this section and pay a fee as determined by the director.
d. An individual who obtained a qualified purchasing agent certificate prior to enactment of P.L. , c. (C. ) (pending before the Legislature as this bill) shall be exempt from taking the State qualifying examination, but shall adhere to all requirements for renewal pursuant to subsection c. of this section. If such a qualified purchasing agent certificate expires due to the failure of the holder to renew the certificate as prescribed in subsection c. of this section, that individual shall be required to pass the qualifying test as provided pursuant to subsection b. of this section in order to be issued a new qualified purchasing agent certificate.
e. Those persons who have been performing the duties of a purchasing agent for a municipality or county pursuant to P.L.1970, c.198 (C.40A:11-1 et seq.), or school board pursuant to P.L.1977, c.114 (C.18A:18A-1 et seq.) for at least three years, prior to the first day of the sixth month following the promulgation of rules and regulations to effectuate the purposes of P.L. , c. (C ) (pending before the Legislature as this bill), may take the State qualifying examination, if not otherwise exempt under subsection d. of this section, without the courses required in subsection b. of this section.
f. (1) Each contracting unit shall appoint a qualified purchasing agent within three years of the enactment of P.L. , c. (C. ) (pending before the Legislature as this bill).
(2) A contracting unit that has not appointed a qualified purchasing agent within three years of the enactment of P.L. , c. (C. ) (pending before the Legislature as this bill) may be granted up to two additional years to meet this requirement, upon certification to the director that the contracting unit has made a good faith effort to appoint a purchasing agent. Such certification shall include documentation of such good faith efforts.
(3) If in the office of purchasing agent a vacancy occurs in a position formerly held by a qualified purchasing agent, the governing body or chief executive officer, as appropriate to the form of government, may appoint, for a period not to exceed one year commencing from the date of the vacancy, a person who does not possess a qualified purchasing agent certificate to serve as a temporary purchasing agent. Any person so appointed may, with the approval of the director, be reappointed as a temporary purchasing agent for one additional year following the end of the first temporary appointment. No contracting unit shall employ a temporary purchasing agent for more than two consecutive years.
g. The director may revoke or suspend a qualified purchasing agent certificate for dishonest practices or willful or intentional failure, neglect, or refusal to comply with the laws relating to procurement, or for other good cause. The governing body, together with the chief executive officer of any contracting unit, or a school board, may request a review by the director of the behavior or practices of a person holding a qualified purchasing agent certificate, except after a proper hearing before the director or the director’s designee following due notice. If the qualified purchasing agent certificate held by a person serving as a purchasing agent is revoked, that person shall be removed from his or her position by the director, the position shall be declared vacant, and the person shall not be eligible to hold that position or to make application for recertification for a period of five years from the date of revocation.
h. If a governing body
fails or refuses to comply with the provisions of this section and has received
an order from the director to do so, the members of the governing body who
willfully fail or refuse to comply shall each be subject to a personal penalty
of $25 for each day after the date fixed for final action that the failure or
refusal to comply continues. The amount of penalty may be recovered by the
director in the name of the State as a personal
debt of the member of the governing body, and shall be paid, upon receipt, to the State Treasurer.
i. The director may grant an exemption from the requirements of this section to a contracting unit that demonstrates that the purchasing activity of the contracting unit is minimal or would otherwise not benefit from the appointment of a qualified purchasing agent. Such an exemption shall be valid for five years from the date of issuance, at which time the contracting unit must reapply for an exemption or appoint a qualified purchasing agent. Upon receipt of an application for an exemption pursuant to this subsection, the director shall review the application and approve or deny the request.
j. If a contracting unit has available funds for employee training or education, the contracting unit shall make such funds available to defray or reimburse in whole or in part the cost of courses taken by an employee pursuant to paragraph (5) of subsection b. of this section.
k. The director shall adopt and promulgate rules and regulations to effectuate the purposes of this section.
(cf: P.L.1999, c.440, s.15)
4. This act shall take effect on the first day of the seventh month next following enactment, but the Director of the Division of Local Government Services in the Department of Community Affairs may take such anticipatory action in advance thereof as shall be necessary for the implementation of this act.