STATE OF CONNECTICUT
BY HER EXCELLENCY
M. JODI RELL
GOVERNOR
EXECUTIVE ORDER NO. 7
(This Executive Order and Executive Order No. 7 A have been repealed and rescinded and are no longer operative. Please refer to Executive Order No. 7 B at https://www.ct.gov/governorrell/cwp/view.asp?A=1719&Q=306720 .)
Whereas, in the wake of the scandals related to state contracting, I established the State Contracting Reform Task Force to examine the way in which the state buys goods and services with a directive to restore integrity to, and the public’s trust in, the way we buy such goods and services; and
Whereas, that task force submitted a number of recommendations that were embodied in a legislative proposal for the General Assembly’s consideration;
Whereas, the General Assembly added to that legislative proposal provisions that do not address the irregularities in state contracting, but instead place unacceptable and overly burdensome limitations on the services for which the executive branch may enter into contracts in order to conduct the business of the state and provide essential state services;
Whereas, in light of those provisions, I had no choice but to veto that legislation;
Whereas, there remains an acute need to make reforms in the state contracting process in order to ensure such contracting process reflects the highest standards of integrity, is clean and consistent and is conducted in the most efficient manner possible to enable state agencies to deliver programs and serve our citizens; and
Whereas, there further remains an acute need to address the state’s vulnerabilities in the selection and procurement processes to avoid improprieties, favoritism, unfair practices or ethical lapses in the future, or the appearance of such.
Now, therefore, I, M. Jodi Rell, Governor of the State of Connecticut, acting by virtue of the authority vested in me by the Constitution and by the statutes of this state, do hereby order and direct that:
1. (a) There is established a State Contracting Standards Board that shall consist of five members appointed by the Governor. Each member shall have demonstrated sufficient knowledge by education, training or experience in several of the following enumerated areas: (1) Procurement; (2) contract negotiation, selection and drafting; (3) contract risk assessment; (4) requests for proposals and real estate transactions; (5) business insurance and bonding; (6) the code of ethics; (7) federal and state statutes, policies and regulations; (8) outsourcing and privatization proposal analysis; and (9) small and minority business enterprise development. Such education, training or experience shall have been acquired over not less than a continuous five-year period and shall have been acquired within the ten-year period preceding such appointment.
(b) The chairperson of the board shall be appointed by the members of the board. The members shall serve at the pleasure of the Governor and their terms shall be coterminous with the terms of the Governor.
(c) The State Contracting Standards Board shall be an independent body within the Executive Department.
(d) The chairperson of the board shall be compensated two hundred dollars per diem. Other members of the board shall be compensated two hundred dollars per diem. No person shall serve on the board who holds another state or municipal governmental position and no person on the board nor any spouse, child, stepchild, parent or sibling of such person shall be directly or indirectly involved in any enterprise that does business with the state.
(e) The Governor shall appoint an executive director who shall serve as an ex-officio, nonvoting member of the board. The executive director may be removed from office for reasonable cause. The board shall, annually, conduct a performance evaluation of such executive director. The salary of the Executive Director shall be determined by the Commissioner of the Department of Administrative Services and the individual will be placed in the management pay plan and have benefits such as vacation, sick leave, pension and insurance determined in accordance with that designation. For all other purposes the Executive Director shall be considered an appointed official.
(f) The board may employ secretaries, real estate examiners, contract specialists, forensic fraud examiners, property and procurement specialists, paralegals, attorneys and such other employees as the board deems necessary, all of whom shall be in the state classified service. As the Board is not a state agency, the employees shall be considered to be employees of the Department of Administrative Services for administrative purposes.
(g) The reasonable expenses of the State Contracting Standards Board and its employees shall be paid from the budget of the board upon the approval of the board.
(h) No employee of the State Contracting Standards Board shall hold another state or municipal position, nor shall any such employee or any non-clerical employee or any spouse, child, stepchild, parent or sibling of such employee of the board be directly or indirectly involved in any enterprise that does business with the state. Each member and employee of the State Contracting Standards Board shall file, with the board and with the Citizen’s Ethics Advisory Board, a financial statement indicating all sources of business income of such person in excess of one thousand dollars, and the name of any business with which such member or employee is associated, as defined in subsection (b) of section 1-79 of the general statutes. Such statement shall be a public record. Financial statements for the preceding calendar year shall be filed with the commission on or before April fifteenth of each year if such employee or member held such a position during the preceding calendar year.
(i) The board shall be assigned to the Department of Administrative Services for administrative purposes only.
(j) Three members of the board shall constitute a quorum which shall be required for the transaction of business by the board.
2. For the purposes of this order, the following definitions shall apply:
(a) "Procurement" means contracting for, buying, purchasing, renting, leasing or otherwise acquiring or disposing of, any supplies, services, including but not limited to, contracts for purchase of services and personal service agreements, interest in real property, or construction, and includes all government functions that relate to such activities, including best value selection and qualification based selection.
(b) "Emergency procurement" means procurement by a state agency that is made necessary by a sudden, unexpected occurrence that poses a clear and imminent danger to public safety or requires immediate action to preserve prevent or mitigate the loss or impairment of life, health, property or essential public services or in response to a court order, settlement agreement or other similar legal judgment.
(c) "Best value selection" means a contract selection process in which the award of a contract is based on a combination of quality and cost considerations.
(d) "Qualification based selection" means a contract selection process in which the award of a contract is primarily based on an assessment of contractor qualifications and on the negotiation of a fair and reasonable price.
(e) "State contracting agency" means any state agency and all higher education agencies and institutions.
(f) "Contractor" means any person or entity bidding on, submitting a proposal for, applying for or participating as a subcontractor for, a transaction, procurement or contract described in this Order, including, but not limited to, a small contractor, minority business enterprise, organization providing products and services by persons with disabilities, as described in section 17b-656 of the general statutes, and an individual with a disability, as defined in section 4a-60g of the general statutes.
(g) "Contract risk assessment" means (A) the identification and evaluation of loss exposures and risks, including, but not limited to, business and legal risks associated with the contracting process and the contracted goods and services, and (B) the identification, evaluation and implementation of measures available to minimize potential loss exposures and risks.
(h) "Privatization contract" means an agreement or series of agreements between a state contracting agency and a person, in which such person agrees to provide services valued at five hundred thousand dollars or more over the life of the contract that are substantially similar to and in lieu of services provided, in whole or in part, by employees of such agency or by employees of another state agency for such state agency and that results in the layoff, transfer or reassignment of any state employee. "Privatization contract" does not include the renewal, modification, extension or rebidding of a privatization agreement in effect on or before the effective date of this section, an agreement to provide management or financial consulting or a consultant-services agreement to provide professional architectural or design services on a project-by-project basis for only a period of time.
(i) "Purchase of service agreement" means any contract between a state agency and a nonprofit agency, partnership or corporation for the purchase by the state of ongoing and routine health and human services for clients of the Departments of Social Services, Children and Families, Mental Retardation, Mental Health and Addiction Services, Public Health and Correction which is overseen by the Office of Policy and Management.
(j) "Rebidding" means a state contracting agency's requesting of proposals or qualifications for a contract to provide goods or services that are specific to an existing facility or program provided such goods or services are being provided under a contract in effect as of July 1, 2005.
3. (a) On or before January 1, 2007, the State Contracting Standards Board shall prepare a uniform procurement code applicable to state contracting agency expenditures, including, but not limited to, expenditures: (1) By municipalities that receive state funds, (2) involving any state contracting and procurement processes, including, but not limited to, leasing and property transfers, purchasing or leasing of supplies, materials or equipment, as defined in section 4a-50 of the general statutes, consultant or consultant services, as defined in section 4b-55 of the general statutes, personal service agreements, as defined in section 4-212 of the general statutes, purchase of service agreements or privatization contracts, and (3) relating to contracts for the construction, reconstruction, alteration, remodeling, repair or demolition of any public building. Nothing in this section shall be construed to require the application of uniform procurement code procedures when such procurement involves the expenditure of federal assistance or contract funds and federal law provides applicable procurement procedures.
(b) The uniform procurement code described in subsection (a) of this section shall be designed to: (1) Establish uniform contracting standards and practices among the various state contracting agencies; (2) simplify and clarify the state's laws governing contracting standards and the state’s procurement policies and practices, including, but not limited to, procedures for competitive sealed bids, competitive sealed proposals, small purchases, sole source procurements, emergency procurements and special procurements; (3) ensure the fair and equitable treatment of all businesses and persons who deal with the procurement system of the state; (4) include a process to maximize the use of small contractors and minority business enterprises, as defined in section 4a-60g of the general statutes; (5) provide increased economy in state procurement activities and maximize purchasing value to the fullest extent possible; (6) ensure that the procurement of supplies, materials, equipment, services, real property and construction required by any state contracting agency is obtained in a cost-effective and responsive manner; (7) preserve and maintain the existing contracting, procurement, disqualification and termination authority and discretion of any state contracting agency when such contracting and procurement procedures represent best practices; (8) include a process to improve contractor and state contracting agency accountability; (9) include standards by which state contracting agencies must evaluate proposals to privatize state or quasi-public agency services and privatization contract bid proposals; (10) establish standards for leases and lease-purchase agreements and for the purchase and sale of real estate; and (11) provide a process for competitive sealed bids, competitive sealed proposals, small purchases, sole source procurements, emergency procurements, special procurements, best value selection, qualification based selection and the conditions for their use.
(c) In preparing the uniform procurement code described in subsection (a) of this section, the State Contracting Standards Board shall conduct a comprehensive review of existing state contracting and procurement laws, regulations and practices and shall utilize existing procurement procedures and guidelines that the board deems appropriate.
(d) Upon request by the State Contracting Standards Board, each state contracting agency engaged in procurement shall provide the board, in a timely manner, with such procurement information as the board deems necessary. The board shall have access to all information, files and records related to any state contracting agency in furtherance of this purpose. Nothing in this section shall be construed to require the board's disclosure of documents that are exempt from disclosure pursuant to chapter 14 of the general statutes or that may be protected from disclosure under claim of an attorney-client privilege.
(e) Such uniform procurement code shall be submitted to the General Assembly for its approval. The board shall file such code with the clerks of the House of Representatives and the Senate not later than January 15, 2007 for their consideration and adoption.
4. In addition to the preparation of the uniform procurement code described in section 3 of this Order, the duties of the State Contracting Standards Board shall include:
(a) Recommending the repeal of repetitive, conflicting or obsolete statutes concerning state procurement;
(b) Developing, publishing and maintaining the uniform procurement code for all state contracting agencies;
(c) Assisting state contracting agencies in complying with the code by providing guidance, models, advice and practical assistance to state contracting agency staff relating to: (A) Buying the best service at the best price, (B) properly selecting contractors, and (C) drafting contracts that achieve state goals and protect taxpayers' interest;
(d) Reviewing and certifying that a state contracting agency's procurement processes are in compliance with the code;
(e) Triennially, recertifying each state contracting agency's procurement processes and providing agencies with notice of any certification deficiency and exercising authority as provided under section 6 of this Order if a determination of noncompliance is made;
(f) Defining the training requirements for state contracting agency procurement professionals;
(g) Monitoring implementation of the state contracting portal and making recommendations for improvement to the Department of Administrative Services;
(h) Defining the contract data retention requirements for state agencies concerning retention of information on: (A) The number and type of state contracts currently in effect state-wide, (B) the dollar value of such contracts, (C) a list of client agencies, (D) a description of services purchased under such contracts, (E) contractor names, and (F) an evaluation of contractor performance, and assuring such information is available on the state contracting portal;
(i) Providing the Governor with recommendations concerning the uniform procurement code; and
(j) Approving an ethics training course for state employees involved in procurement and for state contractors. Such ethics training course may be developed and provided by the Citizen’s Ethics Advisory Board or by any person, firm or corporation provided such course is approved by the State Contracting Standards Board.
(k) Developing of recommendations to the General Assembly whereby the powers, duties and obligations of the State Properties Review Board will be performed by the State Contracting Standards Board.
5. (a) The State Contracting Standards Board shall triennially conduct audits of state contracting agencies to ensure compliance with the uniform procurement code. In conducting such audit, the State Contracting Standards Board shall have access to all contracting and procurement records, may interview personnel responsible for contracting, contract negotiations or procurement and may enter into an agreement with the State Auditors of Public Accounts to effectuate such audit.
(b) Upon completion of any such audit, the State Contracting Standards Board shall prepare and issue a compliance report for such state contracting agency. Such report shall identify any process or procedure that is inconsistent with the uniform procurement code and indicate those corrective measures the board deems necessary to comply with code requirements. Such report shall be issued and delivered not later than thirty days after completion of such audit and shall be a public record.
6. Each contract entered into on or after October 1, 2005 shall contain a provision that, for cause, the State Contracting Standards Board may review and recommend termination of any contract or procurement agreement undertaken by any state contracting agency after providing fifteen days notice to the state contracting agency and the applicable contractor. Such action shall be accompanied by notice to the state contracting agency and any other affected party. For the purpose of this section, "for cause" means: (1) A violation of section 1-84, 1-86e or 4a-100 of the general statutes, as amended by this Order, or (2) wanton or reckless disregard of any state contracting and procurement process by any person substantially involved in such contract or state contracting agency.
7. The Board shall establish recommendations on the procedure that agencies should utilize to disqualify a contractor from bidding on state contracts. Such recommendations shall provide the reasons for such disqualification which may include the following:
(a) Conviction of, or entry of a plea of guilty or nolo contendere or admission to, the commission of a criminal offense as an incident to obtaining or attempting to obtain a public or private contract or subcontract, or in the performance of such contract or subcontract;
(b) Conviction of, or entry of a plea of guilty or nolo contendere or admission to, the violation of any state or federal law for embezzlement, theft, forgery, bribery, falsification or destruction of records, receiving stolen property or any other offense indicating a lack of business integrity or business honesty which affects responsibility as a state contractor;
(c) Conviction of, or entry of a plea of guilty or nolo contendere or admission to, a violation of any state or federal antitrust, collusion or conspiracy law arising out of the submission of bids or proposals on a public or private contract or subcontract;
(d) Accumulation of two or more suspensions pursuant to section 8 of this order within a twenty-four-month period;
(e) A willful failure to perform in accordance with the terms of one or more contracts;
(f) A willful violation of a statutory or regulatory provision or requirement applicable to a contract;
(g) A willful or egregious violation of the ethical standards set forth in sections 1-84, 1-86e or 4a-100 of the general statutes or as set forth in this order; or
(h) Any other cause the board determines to be so serious and compelling as to affect responsibility as a state contractor, including, but not limited to: (A) Disqualification by another state for cause, (B) the fraudulent, criminal or seriously improper conduct of any officer, director, shareholder or employee of such contractor, provided such conduct occurred in connection with the individual's performance of duties for or on behalf of such contractor and such contractor knew or had reason to know of such conduct, or (C) the existence of an informal or formal business relationship with a contractor who has been disqualified from bidding on state contracts.
(i) Upon written request by the affected state contractor, the State Contracting Standards Board may reduce the period or extent of disqualification for a contractor if documentation supporting any of the following reasons for modification is provided to the board by the contractor:
(1) Newly discovered material evidence;
(2) Reversal of the conviction upon which the disqualification was based;
(3) Bona fide change in ownership or management; or
(4) Elimination of other causes for which the disqualification was imposed.
8. The Board shall establish recommendations on the procedure that agencies should utilize to suspend contractors from bidding on state contracts. Such recommendations shall provide the reasons for such suspension which may include the following:
(a) Failure without good cause to perform in accordance with specifications or within the time limits provided in the contract;
(b) A record of failure to perform or of unsatisfactory performance in accordance with the terms of one or more contracts, provided failure to perform or unsatisfactory performance caused by acts beyond the control of the contractor shall not be considered to be a basis for suspension;
(c) Any cause the state contracting agency determines to be so serious and compelling as to affect the responsibility of a state contractor, including suspension by another state contracting agency for cause; or
(d) A violation of the ethical standards set forth in sections 1-84, 1-86e and 4a-100 of the general statutes.
The state contracting agency may grant an exception permitting a suspended contractor to participate in a particular contract or subcontract upon a written determination by the commissioner of the state contracting agency that there is good cause for such exception and that such exception is in the best interest of the state.
9. The Governor hereby directs that all public meetings of state agencies shall be posted on that agency’s website.
10. The Governor hereby prohibits appointed officials and state employees in the Executive Branch from contracting for goods and services, for personal use, with any person doing business with or seeking business with his or her agency, unless it is something that is readily available to the general public.
11. The Governor hereby directs that all contracts entered into on of after July 1, 2005 shall contain a requirement that the contractor disclose to the agency head any items of value provided to employees for which full payment has not been made.
12. The Governor hereby directs that no state agency may expend funds for any contract for legal services between the Attorney General and any person, firm or corporation that is entered into on or after January 1, 2006, and that will or that can reasonably be expected to result in attorney's fees, including, but not limited to, contingent fees paid to such person, firm or corporation in the amount of fifty thousand dollars or more, unless such contract has been subject to requests for proposals or requests for qualifications and awarded according to a competitive selection process.
This order shall be effective upon signing.
Dated at Hartford, Connecticut, this 30th day of June, 2005.
M. JODI RELL
Governor
By Her Excellency’s Command:
Susan Bysiewicz
Secretary of the State
