1997 - 1998 LEGISLATURE
January 27, 1998 - Introduced by Representatives Nass, Jensen, Musser,
Hutchison, F. Lasee, Hahn, Johnsrud, Kedzie, Ladwig, Seratti, Vrakas,
Meyer, Huebsch, Walker, Plale, Staskunas, La Fave and Lazich, cosponsored
by Senators Farrow, Huelsman, Darling, Welch, Rosenzweig and Rude.
Referred to Committee on Mandates.
1An Act to create
13.59, 20.765 (2) (c) and chapter 131 of the statutes; relating
2to: restricting state governmental units from engaging in certain commercial
3activities, state governmental procurement requirements and creating a
4legislative joint committee on public-private partnership.
Analysis by the Legislative Reference Bureau
This bill creates a standing legislative joint committee on public-private
partnership consisting of 3 members of each house of the legislature (including 2
members of the majority party and one member of the minority party in each house),
the secretary of administration or his or her designee and 4 other members appointed
by the governor for 2-year terms, 2 of whom must be appointed to represent specified
portions of the business community and 2 of whom must be appointed to represent
specified portions of the labor community. Any person who is adversely affected by
any action of a state governmental unit that is restricted by any provision of the bill
or by any inaction of a state governmental unit with respect to a matter that requires
action by that governmental unit under the bill may file a statement of objections
with the joint committee, which must provide a hearing to the person. The bill
permits the committee to recommend proposed legislation to the legislature or to
recommend proposed administrative rule changes to any state agency which the
committee considers appropriate to carry out its functions. Under the bill, either
house of the legislature may refer proposed legislation to the committee. The
committee is directed to examine the possibility of creating additional partnerships
between state governmental units and for-profit or nonprofit private enterprises for
the purpose of procurement of services from those enterprises when such action is
appropriate. The committee is further directed to periodically review the
performance of any private sector enterprise which contracts to provide a service to
a state governmental unit to ensure that the enterprise is successfully and
competently completing its contractual obligations. The committee is directed to
advise state agencies in the executive branch concerning issues relating to
public-private partnership. The cochairpersons of the committee may direct any
legislative service agency to provide staffing assistance to the committee.
Under the bill, whenever a state governmental unit engages in a commercial
activity, it must, upon request of a majority of the membership of the joint committee,
also prepare a competitive impact statement concerning that activity, using uniform
accounting principles, which describes the cost of the activity, the availability of the
goods or services resulting from the activity from any for-profit or nonprofit private
enterprise and the competitive impact upon for-profit and nonprofit private
enterprises if the commercial activity is contracted by the state to a single for-profit
or nonprofit private enterprise, and the effect that the creation of a public-private
partnership may have upon employes of a state governmental unit who currently
perform any service associated with the commercial activity. In addition, the bill
requires state governmental units to prepare a competitive impact statement for any
bill that is introduced in the legislature if the bill requires a fiscal estimate and it
proposes to authorize or require a state governmental unit to engage in a commercial
activity. The statement is also required for any such proposal that is contained
within an executive budget bill. The joint committee receives all competitive impact
statements and those concerning bills are printed in the same manner that fiscal
estimates are printed currently.
This bill prohibits all state governmental units, including institutions of higher
education, from engaging in any commercial activity for their own use, for the use
of any other state governmental unit or for public use if the goods or services provided
as a result of the activity can be procured from any for-profit or nonprofit private
enterprise "through ordinary business channels". Under the bill, "commercial
activity" means providing goods or performing services which can practically, in a
cost-effective manner and consistently with state collective bargaining agreements
and rules of the department of administration concerning conflicts of interests by
proposed contractors, be obtained from a for-profit or nonprofit private enterprise.
The prohibition does not apply if: 1) the activity is specifically authorized by law; 2)
the activity is not available from any for-profit or nonprofit private enterprise; 3) the
activity is inherently related to the state's defense; or 4) a state governmental unit
can provide the goods or services resulting from the commercial activity to other state
governmental units at a lower cost than if the goods or services were obtained from
a for-profit or nonprofit private enterprise, using uniform accounting standards to
make the cost comparison; 5) use of a for-profit or nonprofit private enterprise to
engage in the activity would cause an unbearable delay or disruption of an essential
program; 6) use of a for-profit or nonprofit private enterprise would impede the
ability of a state governmental unit to fully comply with any collective bargaining
agreement; or 7) the joint committee on public-private partnerships, taking into
account any applicable competitive impact statement, and the views of private
enterprises, state governmental units, and other affected persons, determines that
the interests of the public are best served by maintaining existing practices used by
a state governmental unit to obtain certain essential goods and services.
The bill provides that, unless otherwise required by law, if a state governmental
unit is authorized by law to engage in a commercial activity, it must impose and
collect a fee for that activity that includes all costs related to engaging in the activity.
Currently, there is no general restriction upon commercial activity by state
governmental units. However, state governmental units are generally not
authorized to engage in any activity unless a law so permits or requires.
Under current law, state governmental units are required to bargain
collectively in good faith with labor organizations representing their employes before
subcontracting any services performed by those employes to a nonstate source. The
bill does not alter that duty.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB745, s. 1
13.59 of the statutes is created to read:
213.59 Joint committee on public-private partnership.
(1) Creation. 3
There is created a joint standing committee on public-private partnership composed 4
of the following members:
(a) Two majority party senators, one minority party senator, 2 majority party 6
representatives to the assembly and one minority party representative to the 7
assembly, selected as are the members of standing committees in their respective 8
(b) The secretary of administration or his or her designee.
(c) The following members appointed by the governor to serve for 2-year terms 11
expiring on December 31 of each even-numbered year:
1. Two owners or officers of private enterprises as defined in s. 131.01 (6) or 13
members or representatives of trade associations, one of whom shall be an owner or
officer of a private enterprise having less than $1.5 million in gross annual sales in 2
the most recent calendar or fiscal year or a member or representative of a trade 3
association that is composed of such enterprises.
2. One member or representative of a labor organization that is certified to 5
represent state employes under subch. V of ch. 111.
3. One member or representative of a labor organization that is recognized or 7
certified to represent employes in the private sector.
8(2) Limitation on services.
(a) No member appointed under sub. (1) (c) may 9
serve for more than 5 consecutive full terms.
(b) A member appointed under sub. (1) (c) who ceases to maintain the member's 11
status required for membership under that paragraph vacates his or her office.
The officers of the joint committee shall be a senate chairperson 13
and vice chairperson, an assembly chairperson and vice chairperson and a secretary. 14
The senate chairperson and vice chairperson shall be selected as are chairpersons 15
and vice chairpersons of senate committees. The assembly chairperson and vice 16
chairperson shall be appointed by the speaker. The secretary shall be elected by the 17
committee from among its nonlegislator members.
18(4) Complaints; hearings; recommendations.
(a) In this subsection, "state 19
governmental unit" has the meaning given in s. 131.01 (8).
(b) Any person who is adversely affected by any action of a state governmental 21
unit which is restricted by ch. 131, or by any inaction of a state governmental unit 22
with respect to a matter that requires action by a state governmental unit under ch. 23
131, may file a written statement of objections with the joint committee stating the 24
reasons why the person is adversely affected. Upon receipt of such statement:
1. The committee shall immediately transmit a copy of the statement to the 2
head of the state governmental unit which is referred to in the statement.
2. The head of the state governmental unit which is referred to in the statement 4
shall respond to the joint committee in writing within 30 days after receipt of the 5
statement and shall, if the action concerns a commercial activity and the state 6
governmental unit has not previously submitted a competitive impact statement 7
under s. 131.02 (4) with respect to that activity, submit a competitive impact 8
statement together with its response. In the response, the head of the state 9
governmental unit shall fully address the objections made in the statement and shall 10
indicate whether remedial action should be taken to correct the situation that gave 11
rise to the objections.
3. The joint committee shall hold a public hearing on the statement where all 13
parties are afforded an opportunity to present information unless remedial action 14
agreed to be taken by the state governmental unit is acceptable to the person 15
submitting the statement and to the joint committee. The hearing shall be held 16
within 30 days after receipt of the response under subd. 2. unless the committee 17
determines that additional time is needed for negotiations between the state 18
governmental unit and the person submitting the statement.
4. Within 30 days after any public hearing under subd. 3., the joint committee 20
shall make a recommendation with respect to the matter addressed in the statement 21
and provide a copy to the person submitting the statement and to the head of the 22
state governmental unit.
The joint committee shall prescribe forms for the preparation of 24
competitive impact statements as defined in s. 131.01 (2).
1(6) Legislation; rule changes.
The joint committee may recommend proposed 2
legislation to the legislature or may recommend changes in administrative rules to 3
any agency, as defined in s. 227.01 (1), which the committee considers appropriate 4
to carry out its functions.
Either house may refer proposed legislation to the joint 6
7(8) Partnerships for contractual service procurements.
The joint committee 8
shall examine the possibility of creating additional partnerships between state 9
governmental units and for-profit or nonprofit private enterprises for the purpose 10
of procurement of services from such enterprises on behalf of the state when such 11
action is appropriate. When examining the possibility of creating such partnerships, 12
the committee shall consider competitive impact statements submitted to it by state 13
governmental units. As a part of its examination, the committee shall also review 14
the impact of any such proposed partnerships on collective bargaining agreements 15
under subch. I or V of ch. 111 to ensure that state governmental units remain in 16
compliance with the agreements.
17(9) Performance review.
When a public-private partnership is created to 18
provide a service, the joint committee shall periodically review the performance of 19
the private sector enterprise in providing the service to ensure that the enterprise 20
is successfully and competently completing the obligations agreed to in the contract 21
between the state and the enterprise.
The joint committee shall advise state agencies in the executive 23
branch concerning issues relating to public-private partnership.
The cochairpersons of the joint committee may direct any legislative 25
service agency, as defined in s. 13.90 (1m), to provide staff assistance to the
committee. The committee shall pay any employe who is assigned to provide 2
assistance to the committee from the appropriation under s. 20.765 (2) (c).
AB745, s. 2
20.005 (3) (schedule) of the statutes: at the appropriate place, insert 4
the following amounts for the purposes indicated:
- See PDF for table
AB745, s. 3
20.765 (2) (c) of the statutes is created to read:
(c) Joint committee on public-private partnership.
For the joint 7
committee on public-private partnership, biennially, the amounts in the schedule to 8
carry out the functions of the committee under s. 13.59.
AB745, s. 4
Chapter 131 of the statutes is created to read:
In this chapter, unless the context otherwise requires:
"Commercial activity" means providing goods or performing services which 14
can practically, in a cost-effective manner and consistently with rules of the 15
department of administration promulgated under s. 16.705 (5) and applicable 16
collective bargaining agreements under subch. I or V of ch. 111, be obtained from a 17
for-profit or nonprofit private enterprise, including the manufacturing, processing, 18
managing, sale, offering for sale, rental, leasing, delivering, dispensing, distributing 19
or advertising of any goods or services.
"Competitive impact statement" means a cost analysis using uniform 2
accounting principles to determine:
(a) The total cost of a commercial activity.
(b) The availability of the goods or services resulting from the commercial 5
activity from any for-profit or nonprofit private enterprise.