HOUSE OF REPRESENTATIVES	H.B. NO.	1768
TWENTY-SIXTH LEGISLATURE, 2012		H.D. 1
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO THE HAWAII PUBLIC PROCUREMENT CODE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Section 103D-707, Hawaii Revised Statutes, is amended to read as follows:

     "§103D-707  Remedies after an award.  If after an award it is determined that a solicitation or award of a contract is in violation of law, provided that the violation of law entails an error of at least $10,000 for contracts less than $1,000,000 or an error of at least ten per cent of the estimated value of the contract for contracts with an estimated value of $1,000,000 or more, then:

     (1)  If the person awarded the contract has not acted fraudulently or in bad faith:

         (A)  The award of contract may be ratified and affirmed, or modified; provided it is determined that doing so is in the best interests of the State; [or]

         (B)  The contract may be terminated and the person awarded the contract shall be compensated for the actual expenses, other than attorney's fees, reasonably incurred under the contract, plus a reasonable profit, with such expenses and profit calculated not for the entire term of the contract but only to the point of termination; or

(C) If the contract has not been fully executed by all the parties, the award may be rescinded, remedies prior to award shall be applied pursuant to section 103D-706, and the contract may be reevaluated and awarded to the next lowest responsive and responsible bidder or next ranked responsible offeror;

     (2)  If the person awarded the contract has acted fraudulently or in bad faith:

         (A)  The contract may be declared null and void; or

         (B)  The award of contract may be ratified and affirmed, or modified, if the action is in the best interests of the State, without prejudice to the State's rights to such damages as may be appropriate[.]; or

(C) If the contract has not been fully executed by all the parties, the award may be rescinded, remedies prior to award shall be applied pursuant to section 103D-706, and the contract may be reevaluated and awarded to the next lowest responsive and responsible bidder or next ranked responsible offeror."

     SECTION 2.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect upon its approval.

Report Title:

Procurement; City and County of Honolulu Package; Contract Remedies

Description:

Amends section 103D-707, Hawaii Revised Statutes (HRS), to permit an additional post-award remedy through rescission of the award and application of remedies provided for in section 103D-706, HRS, including contract reevaluation and award to the next lowest responsive and responsible bidder.  (HB1768 HD1)

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