Fiscal Summary

NOT SIGNIFICANT

Bill Summary

This bill enacts the "Procurement Protection Act," which provides that the following entities are generally ineligible to, and must not, bid on or submit a proposal for a contract with a state agency or political subdivision of this state for goods or services:

(1) A foreign adversary company;

(2) A company currently banned or at any point hereto banned from doing business in the United States by the federal government ("federally banned corporation"); or

(3) A company that offers to provide goods or services manufactured or produced by an entity described in (1) or (2) above.

However, this bill authorizes a state agency or political subdivision to enter into a contract for goods manufactured by a company that is ineligible under this bill if (i) no other reasonable option for procuring the goods exists; (ii) the contract is pre-approved by the department of general services ("department"); and (iii) not procuring the goods would pose a greater threat to this state or a political subdivision thereof than the threat associated with the goods themselves.

SUBMISSION OF BIDS

This bill requires a company that submits a bid or proposal with respect to a contract with a state agency or political subdivision of this state for goods or services to certify that the company is not ineligible to bid on the contract pursuant to this bill. If the department determines that a company has submitted a false certification, then the following applies:

(A) The company is liable for a civil penalty in an amount that is equal to the greater of $250,000 or twice the amount of the contract for which a bid or proposal was submitted;

(B) The state agency or political subdivision shall terminate the contract with the company; and

(C) The company is ineligible to, and shall not, bid on a state contract for 60 months, regardless of whether the company becomes otherwise eligible to submit a bid.

This bill requires each bid or offer submitted for a contract with this state or a political subdivision of this state to include a disclosure of whether the bidder, offeror, or its corporate parents or subsidiaries, within the 24-month period before submission of the bid or offer, had business operations that involved contracts with, or the provision of goods or services from or to, a foreign adversary or a foreign adversary company. A bid or offer that does not include such disclosure may be given a reasonable period after the bid or offer is submitted to cure non-disclosure. Additionally, the public entity evaluating bids may consider the disclosure when evaluating the bid or offer or awarding the contract. The public entity that evaluates bids that receives a disclosure must provide such disclosures to the department.

This bill provides that a bid or offer must not be submitted for a state contract or for any contract with a political subdivision of this state if the bidder, offeror, or any of its corporate parents or subsidiaries, within the 60 months before submission of the bid or offer, had business operations that involved contracts with or the provision of goods or services to a military entity of a foreign adversary, a foreign adversary company, a political party of a foreign adversary, or a federally banned corporation. A company submitting a bid or offer for a contract with this state or a political subdivision of this state must certify with the public entity accepting the bid that the bidder, offeror, or any of its corporate parents or subsidiaries, has not within the 60 months before submission of the bid or offer, had business operations that involved contracts with or the provision of goods or services to a military entity of a foreign adversary, a foreign adversary company, a political party of a foreign adversary, or a federally banned corporation. A public entity that evaluates bids that receives such a certification must provide such disclosures to the department. This bill provides that if the department determines that a company has submitted a false certification, then the same penalties described in (A)-(C) above apply.

As used in this bill:

(1) "Foreign adversary" means the People's Republic of China, the Russian Federation, the Islamic Republic of Iran, the Democratic People's Republic of Korea, the Republic of Cuba, the Venezuelan regime of Nicolás Maduro, or the Syrian Arab Republic, including any agent of or any other entity under significant control of such foreign country of concern, or any other entity deemed a foreign adversary by the governor in consultation with the department of safety and homeland security; and

(2) "Foreign adversary company" means a company owned or controlled, in whole or in part, by the government of a foreign adversary, by individuals acting in official government capacities of a foreign adversary, by a company domiciled in a foreign adversary, or by a company otherwise under control of a foreign adversary.