Report Title:
Small Business; Prompt Payment; Preferential Bid Status
Description:
Requires public agencies to promptly pay for procured goods and services. Reduces time period public agencies have to pay for goods and services from 30 to 15 calendar days. Changes interest rate to be paid by public agencies for failure to promptly pay for goods or services to an unspecified amount. Provides a procurement preference to small businesses located in the State.
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
988 |
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TWENTY-THIRD LEGISLATURE, 2005 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to Procurement.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to part X to be appropriately designated and to read as follows:
"§103D- Preference for Hawaii based small businesses. (a) When a governmental body contracts for goods or services, a five per cent preference shall be given to goods to be purchased from, or services to be provided by, Hawaii based small businesses.
(b) For the purposes of this section "Hawaii based small businesses" means a "small business" as defined in section 103D-901 that is domiciled in the State for tax purposes and that affirms:
(1) On the date of any award of a contract, it is licensed to conduct business and other activities in the State as a domestic business, in good standing, and in full compliance with registration requirements, all tax, wage and hour, employment, insurance, workers' compensation, and employee health and benefits laws of the State; and
(2) At least fifty per cent of its workforce consists of state residents. For purposes of this paragraph, a person shall be deemed to be a "state resident" if the person has lived continuously in the State for a period of six months prior to the awarding of the contract and has not established residency in another state by living continuously therein or filing tax returns in that jurisdiction during that time.
(c) The policy board shall adopt rules under chapter 91 to establish the preference for Hawaii based small businesses and may create forms to effectuate the purposes of this section."
SECTION 2. Section 103-10, Hawaii Revised Statutes, is amended by amending subsections (a) and (b) to read as follows:
"(a) Any person who renders a proper statement for goods delivered or services performed, pursuant to contract, to any agency of the State or any county, shall be paid no later than [thirty] fifteen calendar days following receipt of the statement or satisfactory delivery of the goods or performance of the services. In the event circumstances prevent the paying agency from complying with this section, the person shall be entitled to interest from the paying agency on the principal amount remaining unpaid at a rate equal to the [prime rate for each calendar quarter plus two] per cent, commencing on the [thirtieth] fifteenth day following receipt of the statement or satisfactory delivery of the goods or performance of the services, whichever is later, and ending on the date of the check. [As used in this subsection, "prime rate" means the prime rate as posted in the Wall Street Journal on the first business day of the month preceding the calendar quarter.]
(b) This section shall not apply in those cases where delay in payment is due to:
(1) A bona fide dispute between the State or any county and the contractor concerning the services or goods contracted for;
(2) A labor dispute;
(3) A power or mechanical failure;
(4) Fire;
(5) Acts of God; or
(6) Any similar circumstances beyond the control of the State or any county.
Where the time of payment is contingent upon the receipt of federal funds, or federal approval, the solicitation of bids for contracts shall clearly state that payment is contingent upon those conditions. If the solicitation for bids contains the warning and a contract is awarded in response to the solicitation, then interest shall not begin to accrue upon any unpaid voucher until the [thirtieth] fifteenth day following receipt by the State or county of the contractor's statement or the [thirtieth] fifteenth day following receipt of the federal funds or approval, whichever occurs later, and shall end as of the date of the check."
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act shall take effect on July 1, 2005.
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INTRODUCED BY: |
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