LRB-2092/2
JTK:kjf:pg
2005 - 2006 LEGISLATURE
January 24, 2006 - Introduced by Representatives Berceau, Black, Albers,
Musser, Molepske, Colon, Boyle, Zepnick, Grigsby
and Nelson. Referred to
Committee on State Affairs.
AB940,1,6 1An Act to amend 16.705 (1), 16.75 (1) (a) 1., 16.75 (6) (bm), 16.75 (6) (e), 23.41
2(5), 25.18 (1) (a), 25.18 (1) (f), 25.18 (1) (m), 84.01 (13), 84.06 (2) (a), 84.06 (3),
384.06 (4), 85.015, 102.81 (2), 221.0903 (4) (b) and 655.27 (2); and to create 15.07
4(1) (a) 7., 15.07 (5) (zm), 15.55, 16.705 (5m) and 20.240 of the statutes; relating
5to:
review of certain proposed state contractual service engagements and
6creation of a contract review board.
Analysis by the Legislative Reference Bureau
Currently, the Department of Administration (DOA) and those executive
branch agencies to which DOA delegates purchasing authority may enter into
contracts for contractual services if the services can be performed more economically
or efficiently by contract than through the use of state employees. This bill provides
that DOA and its agents may enter into contracts for contractual services only if the
services can be performed more economically by contract than through the use of
state employees.
Currently, before a vendor is engaged to perform services that are currently
being performed by represented state employees, the decision to contract for the
services must first be bargained collectively in good faith by the state with the
certified representative of the employees to the point of impasse. If no agreement is
reached, the state may proceed to contract for the services. In addition, with certain
exceptions, any proposal to engage a person to perform contractual services for a

state agency must first be submitted to DOA for review and approval. The agency
requesting approval of a proposed engagement must submit written justification for
the proposal which must include justification of need, justification for not
contracting with other state agencies, a specific description of the scope of the
services to be performed by contract, and justification for the procurement process
if a process other than competitive bidding is to be used. In addition, certain
proposed contracts for contractual services must be reviewed by the director of the
Office of State Employment Relations in DOA in order to ensure that the contracting
agency properly utilizes the services of state employees, evaluates the feasibility of
using limited-term appointments prior to entering into the contract, and does not
enter into a contract that would conflict with an existing collective bargaining
agreement.
This bill provides, in addition to these requirements, with certain exceptions,
that each proposed engagement to perform services for an executive branch state
agency must be submitted for prior review and approval of a contract review board
that is created by the bill. The board consists of seven members serving for two-year
terms. Two of the members are appointed by the governor, one of whom must be a
representative of an organization that is certified by the Wisconsin Employment
Relations Commission to represent state employees, if any. In addition, one member
each is appointed by the speaker of the assembly, the minority leader of the assembly,
the president of the senate, the senate minority leader, and the director of the Office
of State Employment Relations in DOA.
Under the bill, the review requirement applies only if DOA or an agency to
which DOA has delegated contracting authority determines that the proposed
engagement will result in the net reduction of at least one full-time equivalent state
position. The bill requires an agency to provide the board with certain information
to be used in conducting its review. The board must approve the proposed
engagement if it determines that the proposed engagement is consistent with state
law and that the quality of services and cost benefits resulting from the engagement
are greater than the quality of services and cost benefits to the state resulting from
performance of the services by state employees. The board must exclude any savings
resulting from replacement of state employees by nonstate personnel who are
younger in age than the state employees.
The review requirements do not apply to a proposed engagement that has been
bargained collectively with the certified representative for each state position the
majority of whose duties will be displaced under the engagement if the
representative agrees to the engagement. The review requirements do not apply to
renewal of an existing contractual services agreement upon substantially the same
terms and conditions, plus reasonable price adjustments necessitated by actual cost
increases. Under the bill, decisions of the Contract Review Board may be appealed
under the State Administrative Procedure Act and are subject to judicial review.

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:
AB940, s. 1 1Section 1. 15.07 (1) (a) 7. of the statutes is created to read:
AB940,3,32 15.07 (1) (a) 7. Members of the contract review board shall be appointed as
3provided in s. 15.55.
AB940, s. 2 4Section 2. 15.07 (5) (zm) of the statutes is created to read:
AB940,3,55 15.07 (5) (zm) Members of the contract review board, $25 per day.
AB940, s. 3 6Section 3. 15.55 of the statutes is created to read:
AB940,3,15 715.55 Contract review board; creation. There is created a contract review
8board consisting of 7 members serving for 2-year terms. Two of the members shall
9be appointed by the governor, of whom one shall be a representative of an
10organization that is certified to represent employees under such. V of ch. 111, if any;
11one member shall be appointed by the director of the office of state employment
12relations in the department of administration; one member shall be appointed by the
13speaker of the assembly; one member shall be appointed by the minority leader of
14the assembly; one member shall be appointed by the president of the senate; and one
15member shall be appointed by the minority leader of the senate.
AB940, s. 4 16Section 4. 16.705 (1) of the statutes, as affected by 2005 Wisconsin Act ....
17(Assembly Bill 105), is amended to read:
AB940,4,218 16.705 (1) The Subject to approval under sub. (5m) whenever required, the
19department or its agents may contract for services which can be performed more
20economically or efficiently by such contract. The department shall, by rule, prescribe

1uniform procedures for determining whether services are appropriate for
2contracting under this subsection.
AB940, s. 5 3Section 5. 16.705 (5m) of the statutes is created to read:
AB940,4,144 16.705 (5m) (a) Except as authorized in par. (e), after each proposed
5engagement to perform contractual services is approved under sub. (2) and under
6sub. (3), whenever required, if the department or another agency to whom the
7department has delegated contracting authority under s. 16.71 (1) determines that
8the proposed engagement will result in the net reduction of at least one full-time
9equivalent position, or that the proposed engagement is a renewal of a previous
10engagement that is not exempted under par. (f), the contracting agency shall not
11solicit bids or competitive sealed proposals and shall not enter into any contract to
12perform those services until the agency submits the proposed solicitation, or if there
13is to be no solicitation, the proposed contract for review of the contract review board
14and the board approves the proposed engagement.
AB940,4,1915 (b) The agency shall provide the contract review board with all information
16required by the board to determine whether the proposed solicitation or contract
17should be approved. The information shall include a comprehensive analysis, in the
18form prescribed by the contract review board, of the costs and benefits of replacing
19one or more state positions with services performed by contract.
AB940,5,320 (c) The contract review board shall approve the proposed solicitation or
21contract if the board determines that the proposed contracting is consistent with
22state law and that the quality of services and the cost benefits to the state of
23contracting for services are greater than the quality of services and cost benefits
24resulting from performance of the services by state employees. If the board
25determines that the quality of services and cost benefits to the state of contracting

1for services are substantially equivalent to the quality of services and cost benefits
2to the state resulting from performance of the services by state employees, the board
3shall disapprove the proposed solicitation or contract.
AB940,5,194 (d) In determining the cost benefits to the state that will result from
5replacement of one or more net full-time equivalent positions with contractual
6services under par. (c), the contract review board shall exclude any savings resulting
7from replacement of state employees who occupy the positions to be replaced with
8nonstate personnel who are younger in age than those state employees. The contract
9review board may request information from any proposed vendor concerning the
10ages of the personnel who will be performing services under any proposed
11contractual services contract. The contract review board may also request
12information from any agency for which contractual services will be performed under
13a proposed solicitation or contract concerning any employees of the agency the
14majority of whose time would be spent performing services required under the
15proposed solicitation or contract if no engagement occurs. Each agency shall provide
16the information requested by the contract review board under this paragraph. No
17agency may enter into a contract with any vendor who fails to provide complete
18information to the contract review board pursuant to an authorized request under
19this paragraph.
AB940,5,2420 (e) Paragraph (a) does not apply to a proposed solicitation or contract that has
21been bargained collectively with the certified representative for each state position
22the majority of whose duties will be displaced under the proposed solicitation or
23contract and with respect to which the representative has agreed in writing to the
24proposed solicitation or contract.
AB940,6,4
1(f) Paragraph (a) does not apply to any proposed solicitation or contract to
2renew an existing contractual services contract under substantially the same terms
3and conditions, plus reasonable price adjustments necessitated by actual cost
4increases.
AB940,6,65 (g) Any aggrieved person may appeal a decision of the contract review board
6and the appeal shall be treated as a contested case under ch. 227.
AB940, s. 6 7Section 6. 16.75 (1) (a) 1. of the statutes, as affected by 2005 Wisconsin Act 25,
8is amended to read:
AB940,6,179 16.75 (1) (a) 1. All orders awarded or contracts made by the department for all
10materials, supplies, equipment, and contractual services to be provided to any
11agency, except as otherwise provided in par. (c) and subs. (2), (2g), (2m), (3m), (3t),
12(6), (7), (8), (9), and (10m) and ss. 16.705 (5m), 16.73 (4) (a), 16.751, 16.754, 50.05 (7)
13(f), 153.05 (2m) (a), 287.15 (7), and 301.265, shall be awarded to the lowest
14responsible bidder, taking into consideration life cycle cost estimates under sub.
15(1m), when appropriate, the location of the agency, the quantities of the articles to
16be supplied, their conformity with the specifications, and the purposes for which they
17are required and the date of delivery.
AB940, s. 7 18Section 7. 16.75 (6) (bm) of the statutes is amended to read:
AB940,6,2419 16.75 (6) (bm) If the secretary determines that it is in the best interest of this
20state to do so, he or she may waive any requirement under subs. (1) to (5) and ss.
2116.705 and 16.72 (2) (e) and (f) and (5) except s. 16.705 (5m) with respect to any
22contract entered into by the department of workforce development under s. 49.143,
23if the department of workforce development presents the secretary with a process for
24the procurement of contracts under s. 49.143 and the secretary approves the process.
AB940, s. 8 25Section 8. 16.75 (6) (e) of the statutes is amended to read:
AB940,7,10
116.75 (6) (e) The governor or his or her designee may waive any requirement
2of this subchapter if the governor or his or her designee finds that there exists an
3emergency which threatens the public health, safety or welfare and the waiver is
4necessary to meet the emergency. The governor or his or her designee shall require
5the award of each contract under this paragraph to be made with such competition
6as is practicable under the circumstances. The governor or his or her designee shall
7file with the department a statement of facts constituting the emergency for each
8waiver issued under this paragraph, and a statement of the basis for selection of each
9contractor under the emergency procedure. This paragraph does not apply to the
10requirement requirements specified in sub. (7) and s. 16.705 (5m).
AB940, s. 9 11Section 9. 20.005 (3) (schedule) of the statutes: at the appropriate place, insert
12the following amounts for the purposes indicated: - See PDF for table PDF
AB940, s. 10 13Section 10. 20.240 of the statutes is created to read:
AB940,7,15 1420.240 Contract review board. There is appropriated to the contract review
15board for the following program:
AB940,7,18 16(1) Review of state contractual services agreements. (a) General program
17operations.
The amounts in the schedule for the general program operations of the
18contract review board.
AB940, s. 11 19Section 11. 23.41 (5) of the statutes is amended to read:
AB940,8,14
123.41 (5) Each contract for construction work entered into by the department
2under this section shall be awarded on the basis of bids or competitive sealed
3proposals in accordance with procedures established by the department. Each
4contract for construction work shall be awarded to the lowest responsible bidder or
5the person submitting the most advantageous competitive sealed proposal as
6determined by the department. If the bid of the lowest responsible bidder or the
7proposal of the person submitting the most advantageous competitive sealed
8proposal is determined by the department to be in excess of the estimated reasonable
9value of the work or not in the public interest, the department may reject all bids or
10competitive sealed proposals. Every such contract is exempted from ss. 16.70 to
1116.705 (5), 16.705 (6) to 16.75, 16.755, 16.76, 16.767 to 16.77, 16.78 to 16.82, 16.855,
1216.87, and 16.89, but ss. 16.705 (5m), 16.528, 16.754, and 16.765 apply to the
13contract. Every such contract involving an expenditure of more than $60,000 is not
14valid until the contract is approved by the governor.
AB940, s. 12 15Section 12. 25.18 (1) (a) of the statutes is amended to read:
AB940,8,2216 25.18 (1) (a) Notwithstanding s. 20.930 and all provisions of subch. IV of ch.
1716 and s. 20.930, except s. 16.705 (5m), employ special legal or investment counsel
18in any matters arising out of the scope of its investment authority. The employment
19of special legal counsel shall be with the advice and consent of the attorney general
20whenever such special counsel is to be compensated by the board. Any expense of
21counsel so employed shall be borne by the fund for which the services shall be
22furnished.
AB940, s. 13 23Section 13. 25.18 (1) (f) of the statutes is amended to read:
AB940,9,524 25.18 (1) (f) Maintain and repair any building or other structure or premises
25which it owns in fee or in which it owns the beneficial interest and, notwithstanding

1all provisions of subch. IV or V of ch. 16 , except s. 16.705 (5m), it shall have exclusive
2authority to make such agreements and enter into such contracts as it deems
3necessary for such purpose. All noncapital costs under this paragraph shall be
4charged to the current income accounts of the funds having an interest in the
5building, structure or premises.
AB940, s. 14 6Section 14. 25.18 (1) (m) of the statutes is amended to read:
AB940,9,127 25.18 (1) (m) Notwithstanding all provisions of subchs. IV and V of ch. 16,
8except s. 16.705 (5m), employ professionals, contractors or other agents necessary to
9evaluate or operate any property if a fund managed by the board has an interest in,
10or is considering purchasing or lending money based upon the value of, that property.
11Costs under this paragraph shall be paid by the fund and charged to the appropriate
12account under s. 40.04 (3).
AB940, s. 15 13Section 15. 84.01 (13) of the statutes, as affected by 2005 Wisconsin Act ....
14(Assembly Bill 105), is amended to read:
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