AB228: Bill Text

LRB-0066/1

TK/JTK/CH/AG/MS/rc:kjf:ph

2009 - 2010 LEGISLATURE

2009 Assembly BILL 228

April 23, 2009 - Introduced by Representatives Sherman, Turner, Hilgenberg, J. Ott, Petrowski, Berceau, Jorgensen, Pope-Roberts, Richards, Shilling and Smith, cosponsored by Senators Kreitlow, Lehman, Taylor and Vinehout. Referred to Committee on Veterans and Military Affairs.

AB228,2,9 An Act to renumber 18.16 (2), 18.16 (3), 18.16 (4), 18.16 (5), 18.64 (2), 18.64 (3), 18.64 (4), 18.64 (5), 18.77 (2), 18.77 (3), 18.77 (4), 18.77 (5), 85.25 (2) (c) 1. and 2., 229.46 (1) (a), 229.70 (1) (a) and 229.845 (1) (a); to renumber and amend 16.75 (3m) (a), 16.75 (3m) (b), 16.75 (3m) (c) 2., 16.75 (3m) (c) 5., 16.855 (10m) (a), 16.87 (2), 84.075 (1) and 200.57 (1); to amend 16.75 (3m) (c) 1., 16.75 (3m) (c) 3., 16.75 (3m) (c) 4., 16.855 (10m) (b), 16.855 (10m) (c), 16.855 (14) (a), 18.16 (title), 18.16 (6), 18.64 (title), 18.64 (6), 18.77 (title), 18.77 (6), 23.41 (6), 25.185 (title), 25.185 (3), 84.075 (title), 84.075 (2), 84.075 (3), 85.25 (2) (c) (intro.), 200.57 (title), 229.46 (2) (intro.), 229.46 (3) (intro.), 229.70 (title), 229.70 (2), 229.70 (3) (intro.), 229.70 (4), 229.70 (4m), 229.70 (5) (b) 1., 229.70 (5) (b) 2., 229.70 (5) (b) 3., 229.8273 (title), 229.8273 (2), 229.8273 (3), 229.8273 (4), 229.8273 (5) (b) 1., 229.8273 (5) (b) 2., 229.8273 (5) (b) 3., 229.8273 (6), 229.845 (title) and 229.845 (2); to repeal and recreate 18.16 (1), 18.64 (1), 18.77 (1) and 25.185 (1); and to create 16.75 (3m) (a) 1., 2. and 3., 16.75 (3m) (b) 2., 16.75 (3m) (c) 2. b. and d., 16.75 (3m) (c) 5. b., 16.855 (10m) (ac), 16.855 (10m) (am) 2., 16.87 (1) (am), 16.87 (2) (c), 18.16 (2) (b), 18.16 (3) (b), 18.16 (4) (b), 18.16 (5) (b), 18.64 (2) (b), 18.64 (3) (b), 18.64 (4) (b), 18.64 (5) (b), 18.77 (2) (b), 18.77 (3) (b), 18.77 (4) (b), 18.77 (5) (b), 84.075 (1c), 84.075 (1m) (b), 85.25 (2) (c) 2m., 200.57 (1) (a), 200.57 (3), 229.46 (1) (ag), 229.70 (1) (ag), 229.8273 (1) (am), 229.845 (1) (ag), 231.29, 234.36 and 560.033 of the statutes; relating to: awarding state procurements to certified disabled veteran-owned businesses, providing an exemption from emergency rule procedures, and requiring the exercise of rule-making authority.

Analysis by the Legislative Reference Bureau

Currently, minority-owned businesses that are certified by the Department of Commerce (Commerce) receive certain preferences in governmental procurement. State agencies must attempt to ensure that 5 percent of the total amount expended for state procurements in each fiscal year is paid to minority-owned businesses. With the exception of nonhighway construction work and certain other limited exceptions, state agencies that are subject to requirements to make purchases through competitive bidding or competitive sealed proposals may accept a bid or proposal from a minority-owned business that is no more than 5 percent higher than the apparent low bid or most advantageous proposal. Unless the secretary of administration reports to the Joint Committee on Finance the reasons for not doing so, the Building Commission must ensure that at least 6 percent of the total long-term state public debt, revenue bonding, and short-term borrowing in each fiscal year is underwritten by minority-owned investment firms. The Investment Board must attempt to ensure that 5 percent of the total funds it expends for financial and investment analysis and for common stock and convertible bond brokerage commissions in each fiscal year is expended for the services of minority-owned financial advisers or minority-owned investment firms.

In addition, metropolitan sewerage commissions serving metropolitan sewerage districts that encompass first class cities, presently only Milwaukee, must attempt to ensure that 5 percent of the total funds expended for financial and investment analysis and for common stock and convertible bond brokerage commissions in each fiscal year is expended for the services of minority-owned financial advisers or minority-owned investment firms. Current law contracting provisions that apply to special purpose districts (local exposition districts, professional baseball park districts, professional football stadium districts, and cultural arts districts) also contain provisions that relate to minority and women hiring and contracting. Generally, persons awarded contracts for local exposition districts must agree that at least 25 percent of the employees hired because of the contracts will be minority group members; at least 5 percent of the employees hired will be women; at least 25 percent of the aggregate dollar value of certain contracts will be awarded to minority businesses; and at least 5 percent of the aggregate dollar value of certain contracts will be awarded to women's business. In the case of the other special districts, the minority and women contracting provisions are goals, which generally include the same participation percentages, except that the participation percentages for minority group members is 15 percent for football stadium districts and cultural arts districts.

This bill creates similar preferences in awarding state contracts or orders to disabled veteran-owned businesses certified by Commerce. The bill does not, however, create any goals for total amounts or percentages of state contracts or orders to be awarded to these businesses. The bill defines a disabled veteran as a veteran who, at the time of application for certification, is a resident of the state and is in receipt of an award from the U.S. Department of Veterans Affairs of a disability rating of at least 30 percent.

Under the bill, Commerce must certify a business, financial adviser, or investment firm that meets all of the following requirements:

1. One or more disabled veterans owns not less than 51 percent of the business, financial adviser, or investment firm or, if the business, financial adviser, or investment firm is publicly owned, 51 percent of the stock.

2. One or more disabled veterans or duly authorized representatives of the disabled veteran controls the management and daily business operations of the business, financial adviser, or investment firm.

3. The business, financial adviser, or investment firm has its principal place of business in this state.

4. The business, financial adviser, or investment firm is performing a useful business function. Useful business function is defined under the bill as the provision of materials, supplies, equipment, or services to customers, including the state.

Commerce may decertify any business, financial adviser, or investment firm that Commerce determines no longer qualifies for certification. The bill establishes an appeal process for businesses, financial advisers, or investment firms decertified by Commerce.

The bill directs the Department of Administration (DOA) to annually report to the appropriate standing committees of the legislature concerning the total amount of money and the percentage of the total amount of money paid to and the percentage of the total amount of indebtedness underwritten by disabled veteran-owned businesses, financial advisers, and investment firms. In addition, the bill directs DOA to report to the same committees, no later than March 31 of the fourth year beginning after the year in which the bill becomes law concerning DOA's recommendations for either a goal consisting of a percentage of the total amount of money that will be paid annually to disabled veteran-owned businesses, financial advisers, and investment firms by state agencies or a goal consisting of an annual percentage increase in the total amount of money that will be paid to disabled veteran-owned businesses, financial advisers, and investment firms by state agencies during at least the first full five-year period that follows the date of the report. In calculating all amounts paid to and percentages of amounts paid to businesses and firms, DOA is directed to exclude any contracts or purchases for which a purchase preference would violate a federal law or regulation or any contract between a state agency and a federal agency, or would result in a reduction in the amount of federal aids received by this state.

The Department of Transportation (DOT) administers a disadvantaged business mobilization assistance program, a loan guarantee program created to assist disadvantaged businesses in obtaining capital to participate in DOT construction contracts. Under the program, DOT may make grants to provide funding for these loan guarantees. This bill makes disabled veteran-owned businesses eligible for this program.

For further information see the state and local 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:

AB228, s. 1 Section 1. 16.75 (3m) (a) of the statutes is renumbered 16.75 (3m) (a) (intro.) and amended to read:

AB228,4,3 16.75 (3m) (a) (intro.) In this subsection, "minority:

AB228,4,5 4. "Minority business" means a business certified by the department of commerce under s. 560.036 (2).

AB228, s. 2 Section 2. 16.75 (3m) (a) 1., 2. and 3. of the statutes are created to read:

AB228,4,8 16.75 (3m) (a) 1. "Disabled veteran-owned business" means a business certified by the department of commerce under s. 560.033 (3).

AB228,4,10 2. "Disabled veteran-owned financial adviser" means a financial adviser certified by the department of commerce under s. 560.033 (3).

AB228,4,12 3. "Disabled veteran-owned investment firm" means an investment firm certified by the department of commerce under s. 560.033 (3).

AB228, s. 3 Section 3. 16.75 (3m) (b) of the statutes is renumbered 16.75 (3m) (b) 1. and amended to read:

AB228,5,3 16.75 (3m) (b) 1. The department and any agency making purchases under s. 16.74 shall attempt to ensure that 5% 5 percent of the total amount expended under this subchapter in each fiscal year is paid to minority businesses.

AB228,5,13 3. Except as provided under sub. (7), the department may purchase materials, supplies, equipment, and contractual services from any minority business or disabled veteran-owned business submitting a qualified responsible competitive bid that is no more than 5% 5 percent higher than the apparent low bid or competitive proposal that is no more than 5% 5 percent higher than the most advantageous offer proposal. In administering the preference for minority businesses or disabled veteran-owned businesses established in this paragraph, the department and any agency making purchases under s. 16.74 shall maximize the use of minority businesses or disabled veteran-owned businesses which are incorporated under ch. 180 or which have their principal place of business in this state.

AB228, s. 4 Section 4. 16.75 (3m) (b) 2. of the statutes is created to read:

AB228,5,17 16.75 (3m) (b) 2. The department and any agency making purchases under s. 16.74 shall make efforts to ensure that a portion of the total amount expended under this subchapter in each fiscal year is paid to disabled veteran-owned businesses.

AB228, s. 5 Section 5. 16.75 (3m) (c) 1. of the statutes is amended to read:

AB228,5,22 16.75 (3m) (c) 1. After completing any contract under this subchapter, the contractor shall report to the agency that awarded the contract any amount of the contract that was subcontracted to minority businesses and any amount of the contract that was subcontracted to disabled veteran-owned businesses.

AB228, s. 6 Section 6. 16.75 (3m) (c) 2. of the statutes is renumbered 16.75 (3m) (c) 2. (intro.) and amended to read:

AB228,6,3 16.75 (3m) (c) 2. Each agency shall report to the department at least semiannually, or more often if required by the department, the all of the following for the reporting period specified by the department:

AB228,6,5 a. The total amount of money it has expended for contracts and orders awarded to minority businesses and the.

AB228,6,7 c. The number of contacts with minority businesses in connection with proposed purchases.

AB228, s. 7 Section 7. 16.75 (3m) (c) 2. b. and d. of the statutes are created to read:

AB228,6,11 16.75 (3m) (c) 2. b. The total amount of money and the percentage of the total amount of money it has expended for contracts and orders awarded to disabled veteran-owned businesses.

AB228,6,13 d. The number of contacts with disabled veteran-owned businesses in connection with proposed purchases.

AB228, s. 8 Section 8. 16.75 (3m) (c) 3. of the statutes is amended to read:

AB228,6,19 16.75 (3m) (c) 3. The department shall maintain and annually publish data on state purchases from minority businesses and on state purchases from disabled veteran-owned businesses, including amounts expended and the percentage of total expenditures awarded to minority businesses and amounts expended and the percentage of total expenditures awarded to disabled veteran-owned businesses.

AB228, s. 9 Section 9. 16.75 (3m) (c) 4. of the statutes is amended to read:

AB228,7,13 16.75 (3m) (c) 4. The department shall annually prepare and submit a report to the governor and to the chief clerk of each house of the legislature, for distribution to the appropriate standing committees under s. 13.172 (3), on the total amount of money paid to and the amount of indebtedness or other obligations underwritten by minority businesses, minority financial advisers and, minority investment firms, disabled veteran-owned businesses, disabled veteran-owned financial advisers, and disabled veteran-owned investment firms under the requirements of this subsection and ss. 16.855 (10m), 16.87 (2), 25.185, 84.075 and 565.25 (2) (a) 3. and on this state's progress toward achieving compliance with par. (b) and ss. 16.855 (10m) (a) (am) and (10n), 16.87 (2), 25.185, and 84.075 (1) (1m). The report shall also include the percentage of the total amount of money paid to and the percentage of the total amount of indebtedness or other obligations underwritten by disabled veteran-owned businesses, disabled veteran-owned financial advisers, and disabled veteran-owned investment firms. In calculating the percentages to be reported under this subsection, the department shall exclude any purchase or contract for which a preference would violate any federal law or regulation or any contract between an agency and a federal agency or any contract that would result in a reduction in the the amount of federal aids received by this state.

AB228, s. 10 Section 10. 16.75 (3m) (c) 5. of the statutes is renumbered 16.75 (3m) (c) 5. a. and amended to read:

AB228,7,20 16.75 (3m) (c) 5. a. In determining whether a purchase, contract or subcontract complies with the goal established under par. (b) 1. or s. 16.855 (10m) (am) 1., 16.87 (2) (b), or 25.185 (2), the department shall include only amounts paid to minority businesses, minority financial advisers and minority investment firms certified by the department of commerce under s. 560.036 (2).

AB228, s. 11 Section 11. 16.75 (3m) (c) 5. b. of the statutes is created to read:

AB228,7,25 16.75 (3m) (c) 5. b. In determining whether a purchase, contract, or subcontract is made with a disabled veteran-owned business, the department shall include only amounts paid to disabled veteran-owned businesses certified by the department of commerce under s. 560.033 (3).