An Act To Implement Recommendations of the Government Oversight Committee To Clarify That Competitive Bid Provisions Apply to Grant Awards
Maine Legislature, Session 127, LD 1347
Committee: State and Local Government
Amends: 5 MRSA §1825-A, 5 MRSA §1825-B, 5 MRSA §1825-C, 5 MRSA §1825-D, 5 MRSA §1825-E, 5 MRSA §1825-G, 5 MRSA §1825-I, 5 MRSA §1825-J

Legislative Document 
No. 1347 
H.P. 916 
House of Representatives, April 16, 2015 
An Act To Implement Recommendations of the Government 
Oversight Committee To Clarify That Competitive Bid Provisions 
Apply to Grant Awards 
Reported by Representative KRUGER of Thomaston for the Government Oversight 
Committee pursuant to the Maine Revised Statutes, Title 3, section 997, subsection 2. 
Reference to the Committee on State and Local Government suggested and ordered printed 
pursuant to Joint Rule 218. 
ROBERT B. HUNT 
Clerk 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  5 MRSA §1825-A, sub-§§1, 6 and 8, as enacted by PL 1989, c. 785, §2, 
are amended to read: 
1.  Aggrieved person.  "Aggrieved person" means any person who bids on a contract 
or grant and who is adversely affected, financially, professionally or personally, by that 
contract or grant award decision. 
6.  Petitioner.  "Petitioner" means any person who has requested a stay of a contract 
or grant award decision or a hearing of appeal. 
8.  Stay.  "Stay" means the temporary suspension of a contract or grant award 
pending an appeal under this subchapter. 
Sec. 2.  5 MRSA §1825-B, as amended by PL 2011, c. 555, §1, is further amended 
to read: 
§1825-B.  Bids, awards, contracts and grants 
1.  Purchases by competitive bidding.  The Director of the Bureau of General 
Services shall purchase collectively all goods and services for the State or any department 
or agency of the State in a manner that best secures the greatest possible economy 
consistent with the required grade or quality of the goods or services.  Except as 
otherwise provided by law, the Director of the Bureau of General Services shall make 
purchases of goods or services needed by the State or any department or agency of the 
State through competitive bidding. 
2.  Waiver.  The requirement of competitive bidding may be waived by the Director 
of the Bureau of General Services when: 
A.  The procurement of goods or services by the State for county commissioners 
pursuant to Title 30-A, section 124, involves the expenditure of $2,500 or less, and 
the interests of the State would best be served; 
B.  The Director of the Bureau of General Services is authorized by the Governor or 
the Governor's designee to make purchases without competitive bidding because in 
the opinion of the Governor or the Governor's designee an emergency exists that 
requires the immediate procurement of goods or services; 
C.  After reasonable investigation by the Director of the Bureau of General Services, 
it appears that any required unit or item of supply, or brand of that unit or item, is 
procurable by the State from only one source; 
D.  It appears to be in the best interest of the State to negotiate for the procurement of 
petroleum products; 
E.  The purchase is part of a cooperative project between the State and the University 
of Maine System, the Maine Community College System, the Maine Maritime 
Academy or a private, nonprofit, regionally accredited institution of higher education 
with a main campus in this State involving: 
(1)  An activity assisting a state agency and enhancing the ability of the 
university system, community college system, Maine Maritime Academy or a 
private, nonprofit, regionally accredited institution of higher education with a 
main campus in this State to fulfill its mission of teaching, research and public 
service; and 
(2)  A sharing of project responsibilities and, when appropriate, costs; 
F.  The procurement of goods or services involves expenditures of $10,000 or less, in 
which case the Director of the Bureau of General Services may accept oral proposals 
or bids; or 
G.  The procurement of goods or services involves expenditures of $10,000 or less, 
and procurement from a single source is the most economical, effective and 
appropriate means of fulfilling a demonstrated need. 
3.  Report.  By January 15th of each year the Director of the Bureau of General 
Services shall submit to the joint standing committee of the Legislature having 
jurisdiction over state and local government a report concerning any waivers from the 
competitive bidding provisions established in subsection 2, paragraph E. 
4.  Registry of suppliers.  Suppliers desiring to have their names entered on a 
registry of suppliers must submit a request to the Director of the Bureau of General 
Services in writing.  The Director of the Bureau of General Services may prescribe the 
manner and form in which such a request must be submitted and may limit the number of 
names of out-of-state bidders on any registry.  The name of any supplier entered in such a 
registry who fails to submit a bid on 3 consecutive proposals or invitations to bid may be 
removed from the registry at the discretion of the Director of the Bureau of General 
Services, except that the Department of Corrections remains on any registry until the 
Department of Corrections requests that the department be removed from that registry. 
5.  Alternate bids.  When, in bid forms and specifications, an article or material is 
identified by using a trade name and catalog number of a manufacturer or vendor, the 
term "or approved equal," if not inserted with the identification, is implied.  There is a 
presumption that any reference to a particular manufacturer's product either by trade 
name or by limited description has been made solely for the purpose of more clearly 
indicating the minimum standard of quality desired.  Consideration must be given to 
proposals submitted on approved equal alternate commodities to the extent that such 
action serves the best interest of the State.  The bidder submitting a proposal on a 
commodity other than as specified shall furnish complete identification, descriptive 
literature or data with respect to the alternate commodity that the bidder proposes to 
furnish.  Lack of such information on the bid must be construed to mean that the bidder 
proposes to furnish the exact commodity described.  The State reserves the right to reject 
any bids, in whole or in part, to waive any formality or technicality in any bid and to 
accept any item in any bid. 
6.  Record of bids.  Each bid, with the name of the bidder, must be entered on a 
record.  Each record, with the successful bid indicated, must be open to public inspection 
after the letting of the contract or grant.  A bond for the proper performance of each 
contract or grant may be required of each successful bidder at the discretion of the 
Director of the Bureau of General Services, with the approval of the Commissioner of 
Administrative and Financial Services. 
7.  Awards to best-value bidder.  Except as otherwise provided by law, 
competitively awarded orders awarded, grants or contracts made by the Director of the 
Bureau of General Services or by any department or agency of the State must be awarded 
to the best-value bidder, taking into consideration the qualities of the goods or services to 
be supplied, their conformity with the specifications, the purposes for which they are 
required, the date of delivery and the best interest of the State.  If the bidder that was 
initially awarded the order, grant or contract does not perform, the Director of the Bureau 
of General Services may cancel the order, grant or contract and award a new order, grant 
or contract to the 2nd best-value bidder.  The order, grant or contract may not be awarded 
to a bidder that the Director of the Bureau of General Services determined was not in 
compliance at the time the initial bid was submitted. 
8.  Tie bids.  The Director of the Bureau of General Services shall award contracts, 
grants or purchases to in-state bidders or to bidders offering commodities produced or 
manufactured in the State if the price, quality, availability and other factors are 
equivalent. 
9.  Determination of best-value bidder.  In determining the best-value bidder, the 
Director of the Bureau of General Services or any department or agency of the State shall, 
for the purpose of competitively awarding a contract or grant, add a percent increase on 
the bid of a nonresident bidder equal to the percent, if any, of the preference given to that 
bidder in the state in which the bidder resides. 
10.  List of state preferences published.  The Director of the Bureau of General 
Services on or before January 1st of each year shall publish a list of states that give 
preference to in-state bidders with the percent increase applied in each such state.  The 
Director of the Bureau of General Services or any department or agency of the State may 
rely on the names of states and percentages as published in determining the best-value 
bidder without incurring any liability to any bidder. 
11.  Rulemaking; unfair competition.  State departments and agencies may not 
achieve cost savings due to cost differentials that derive from a bidder's failure to provide 
health and retirement benefits to its employees.  The State Purchasing Agent shall adopt 
rules governing the purchase of services and the awarding of grants or contracts for 
personal services to establish a basis for bid price and cost comparison among businesses 
that provide health and retirement benefits to their employees and those that do not 
provide these benefits.  The rules must include a methodology for calculating bid price 
and cost differentials for services provided by businesses and state employees due to the 
provision of health and retirement benefits for employees.  The rules must adjust the bid 
prices to establish an equivalent basis for bid price and cost comparison among 
businesses when awarding contracts or grants and between businesses and state 
employees when determining whether or not a contract or grant is permitted under section 
1816-A.  These rules must apply to all state departments and agencies.  Rules adopted 
pursuant to this subsection are routine technical rules as defined in chapter 375, 
subchapter 2-A. 
12.  Vendor's fee.  The State Purchasing Agent may collect a fee in an amount equal 
to 1% of the bid from a supplier of apparel, footwear or textiles with a winning bid under 
this section.  The State Purchasing Agent shall apply the fee under this subsection to the 
costs of implementing and administering the state purchasing code of conduct under 
section 1825-L, including developing a consortium to monitor and investigate alleged 
violations of the code of conduct.  The State Purchasing Agent shall adopt routine 
technical rules under chapter 375, subchapter 2-A to carry out the purposes of this 
subsection. 
13.  Vendor's fee report.  By January 15th of each year the Director of the Bureau of 
General Services shall submit a report to the joint standing committee of the Legislature 
having jurisdiction over state and local government matters concerning revenue generated 
by the vendor's fee established in subsection 12. 
14.  Condition of doing business with the State.  Notwithstanding any provision of 
law to the contrary, any purchase by the State of $100,000 or more of tangible personal 
property, except for public utility purchases, as defined in Title 36, section 1752, 
subsection 17, or emergency purchases pursuant to subsection 2, paragraph B, may be 
made only from a person who is registered as a seller pursuant to Title 36, section 
1754-B.  As a condition of doing business with the State, the seller must collect, report 
and remit taxes in accordance with Title 36, Part 3.  As provided in this subsection, the 
State is prohibited from doing business with a person who is not registered as a seller 
pursuant to Title 36, section 1754-B and is not in compliance with the requirement to 
collect, report and remit taxes pursuant to Title 36, Part 3.  After notification of the 
award, the seller must provide the State Purchasing Agent with a valid retailer certificate 
issued by the State Tax Assessor within 7 business days.  If the seller fails to provide the 
registration certificate within 7 business days, the State Purchasing Agent may cancel the 
award and make a new award pursuant to subsection 7.  The State Purchasing Agent shall 
provide the State Tax Assessor with a copy of all contracts and grants awarded pursuant 
to this section.  The State Tax Assessor shall notify the State Purchasing Agent if at any 
time during the term of the contract or grant the person is no longer registered or is not 
collecting, reporting and remitting taxes in compliance with the requirements of Title 36, 
Part 3.  Until the noncompliance is corrected, the State Purchasing Agent may withhold 
any payments to the person. 
Sec. 3.  5 MRSA §1825-C, as amended by PL 2007, c. 466, Pt. A, §12, is further 
amended to read: 
§1825-C.  Rulemaking 
The State Purchasing Agent shall adopt rules under this subchapter governing the 
purchase of services, the awarding of grants or contracts and the procedure by which 
aggrieved persons may appeal contract award decisions made by a department or agency 
of State Government.  These rules must be adopted in accordance with the Maine 
Administrative Procedure Act and apply to all departments and agencies of State 
Government subject to the authority of the Department of Administrative and Financial 
Services as set forth in this chapter. 
Sec. 4.  5 MRSA §1825-D, first ¶, as enacted by PL 1989, c. 785, §2, is amended 
to read: 
The State Purchasing Agent shall make the public aware of contracts and grants for 
which bids are being requested and the procedure to be used in reviewing bids.  Rules 
adopted under this subchapter must include a clear procedure: 
Sec. 5.  5 MRSA §1825-D, sub-§§1, 3 and 4, as enacted by PL 1989, c. 785, §2, 
are amended to read: 
1.  Notice.  For informing the public about contracts and grants for which proposals 
are being requested; 
3.  Contract or grant award.  For determining successful bidders and awarding 
contracts and grants, including written notification to all bidders upon an award decision 
made pursuant to a request for proposals and criteria to be used to resolve tie bids; and 
4.  Criteria for appeals.  For the review of any contract or grant award decision 
appealed under this subchapter. 
Sec. 6.  5 MRSA §1825-E, as amended by PL 1993, c. 192, §1, is further amended 
to read: 
§1825-E.  Appeal procedures 
The Director of the Bureau of General Services shall ensure that every department or 
agency of State Government affords aggrieved persons an opportunity to appeal a 
contract or grant award decision.  As provided by this section, rules adopted under this 
subchapter must establish clear procedures by which an aggrieved person may appeal a 
contract or grant award decision. 
1.  Stay.  Persons aggrieved by a contract or grant award decision may request a stay 
of a contract an award decision.  Such a request must be made to the Director of the 
Bureau of General Services in writing within 10 days of notification of the contract or 
grant award and must state the nature of the grievance. 
The Director of the Bureau of General Services shall issue a stay of a contract or grant 
award decision, pending appeal, upon a showing of irreparable injury to the petitioner, a 
reasonable likelihood of success on the merits, and no substantial harm to adverse parties 
or to the general public. 
The Director of the Bureau of General Services shall notify the petitioner in writing of the 
director's decision regarding the issuance of a stay within 7 days of receipt of the request. 
Failure of the petitioner to obtain a stay does not affect the petitioner's right to a hearing 
of appeal under this subchapter. 
2.  Request for hearing of appeal.  Persons aggrieved by an agency contract or grant 
award decision under this subchapter may request a hearing of appeal.  Such a request 
must be made to the Director of the Bureau of General Services in writing within 15 days 
of notification of the contract award.  The Director of the Bureau of General Services 
shall grant a hearing of appeal unless: 
A.  The Director of the Bureau of General Services determines that: 
(1)  The petitioner is not an aggrieved person; 
(2)  A prior request by the same petitioner relating to the same contract or grant 
award has been granted; 
(3)  The request was made more than 15 days after notice of contract or grant 
award; or 
(4)  The request is capricious, frivolous or without merit; or 
B.  No contract award was granted or grant was awarded. 
The Director of the Bureau of General Services shall notify the petitioner in writing of the 
director's decision regarding a request for a hearing of appeal within 15 days of receipt of 
the request.  If a request for a hearing is granted, notification must be made at least 10 
days before the hearing date and must include the date and location of the hearing and the 
names of the appeal committee members. 
3.  Appeal committee.  A committee of 3 members shall hear a petitioner's appeal 
within 60 days of receipt of the request for an appeal.  The Commissioner of 
Administrative and Financial Services shall appoint 2 members of an appeal committee, 
except that persons who have any direct or indirect personal, professional or financial 
conflict of interest in the appeal or employees of any department affected by the contract 
or grant may not serve on the appeal committee.  The 3rd member is the Director of the 
Bureau of General Services or the director's designee. 
Members of an appeal committee appointed under this section shall meet at the appointed 
time and place in the presence of the petitioner and such individuals as the petitioner 
determines necessary for a full and fair hearing.  The petitioner may present to the appeal 
committee any materials the petitioner considers relevant to the appeal. 
The appeal committee shall keep a written record of each hearing and shall submit its 
decision and the reasons for its decision to the Director of the Bureau of General Services 
in writing no later than 15 days following the hearing of appeal. 
Subject to the requirements of rules adopted under this section and evidence presented 
during a hearing of appeal, the appeal committee may decide either to: 
A.  Validate the contract or grant award decision under appeal; or 
B.    Invalidate the contract or grant award decision under appeal. 
Except as provided in paragraph B, an appeal committee may not modify the contract or 
grant award under appeal, or make a new contract award.  Contracts or grants found 
invalid by an appeal committee under this subchapter become immediately void and of no 
legal effect. 
Sec. 7.  5 MRSA §1825-G, as enacted by PL 1989, c. 785, §2, is amended to read: 
§1825-G.  Failure to act 
Failure or refusal of the State Purchasing Agent to adopt rules under this subchapter 
is sufficient grounds for an aggrieved person to request judicial review of agency 
rulemaking pursuant to section 8058.  In the event that a judicial declaration of an invalid 
rule is made under this section and section 8058, the contract or grant award under appeal 
becomes immediately void and of no legal effect. 
Sec. 8.  5 MRSA §1825-I, as enacted by PL 1993, c. 71, §1, is amended to read: 
§1825-I.  Consultants 
While under contract or working pursuant to a grant with the State, a consultant may 
use state facilities and state property only for the project or projects to which a contract or 
grant applies. 
Sec. 9.  5 MRSA §1825-J, as enacted by PL 1999, c. 623, §1, is amended to read: 
§1825-J.  Reports 
When a state agency enters into a contract or grant with a nongovernmental entity, 
and the contract or grant includes a report to the agency, the contract or grant must 
require that the report be in writing or in another reproducible nontransitory medium and 
be submitted to the agency.  The report must express all of the substantive conclusions 
disclosed to the agency and either summarize the information and data or identify the 
source of the information and data on which those conclusions are based.  Once the report 
is submitted, the agency shall retain at least one copy of the report in its custody.  This 
section applies to contracts and grants with a total cost of $10,000 or more. 
SUMMARY 
This bill implements a recommendation of the Government Oversight Committee 
stemming from the Office of Program Evaluation and Government Accountability report 
on Healthy Maine Partnerships' fiscal year 2013 contracts and funding.  The bill adds the 
word "grant" where applicable to clarify that the statutory provisions requiring 
competitive bidding, and related provisions, apply to grant awards as well as contracts.