Opinion ID: 1315464
Heading Depth: 1
Heading Rank: 7

Heading: Challenged Provisions

Text: On appeal, Sloan contends several provisions in the Hospital Policy do not embody sound principles of appropriately competitive procurement as required by section 11-35-50. For example, Sloan asserts the Hospital Policy generally sets thresholds of $100,000 and $350,000 for application of the policy, whereas the state's Procurement Code, and other, regional codes, contain a $25,000 threshold. [2] Sloan also asserts the Hospital Policy fails to require competitive sealed bidding as the presumptive method of source selection. Sloan argues competitive sealed bidding is provided for in the state's Procurement Code, the Model Procurement Ordinance for Local Governments prepared by the Special Task Force on Local Government Procurement of the South Carolina Budget and Control Board, and in other local codes; therefore, the Hospital's departure from this presumption cannot be deemed to embody `sound principles of appropriately competitive procurement.' The circuit court ruled Sloan failed to meet his burden of proving the challenged provisions did not comply with section 11-35-50 and granted judgment to the Hospital. The court began by noting that Sloan essentially argues that because the Hospital's Policy does not follow several other procurement codes, most notably the State's Consolidated Procurement Code, the State Local Model Procurement Code, and the ABA Model Procurement Code, the [Hospital] Policy fails to embody sound principles of appropriately competitive procurement and thus conflicts with State law. The court observed that Sloan argues that these are community standards that demonstrate a collective legislative judgment as to whether or not certain procurement policies are appropriately competitive. The court rejected Sloan's argument, stating the general assertion that these other codes set some formula that South Carolina is compelled to follow must fail in the absence of other proof. The court stated that requiring local government to follow the collective judgment of other codes would effectively stifle innovation in the procurement practices of local government. The court noted both the state's Procurement Code and the Model Procurement Ordinance were adopted in the early 1980s, so relying upon these sources in determining if something meets the appropriately competitive standard would result in stagnation and the inability to adopt newer and more innovative procurement methods. Moreover, the court found that Sloan's argument conflicts with the Procurement Code itself as there is simply no requirement that entities like the Hospital enact [procedures] that are the same as, or even similar to, the State Consolidated Procurement Code. The court explained, By conscious decision of the legislature, ... local governments are not subject to the State Procurement Code and [n]either are local governments required to adopt provisions similar to those of the State Code. In Colleton County Taxpayers Association v. School District of Colleton County, 371 S.C. 224, 638 S.E.2d 685 (2006), this Court held that the legislature's repeal of a provision in the Procurement Code had no relevance to the validity of an identical provision contained in the School District's procurement policy. We rejected the plaintiffs' suggestion that the repeal amounted to a determination that the School District's provision no longer embodied sound principles of appropriately competitive procurement within the meaning of section 11-35-50. Id. at 241, 638 S.E.2d at 694. We further held that the plaintiffs'blanket conclusion that the School District's provision must be inappropriate because it was no longer in the Procurement Code, without incorporating any supporting authority, effectively constituted a waiver of their argument. Id. In the current appeal, the circuit court relied upon the Colleton County case in finding the provisions of the Procurement Code are irrelevant to what constitutes sound principles of appropriately competitive procurement and in determining local procurement codes need not mirror the State Consolidated Procurement Code, the Local Model Code, or any other code. This determination is supported by the fact that the chairman of the Task Force expressly stated in his cover letter presenting the Model Procurement Ordinance to the chairman of the South Carolina Budget and Control Board that the ordinance is a recommended model and in no way is to be construed as a document which must be mandatorily adopted by any political subdivision. The chairman expressly stated: There is no requirement that the political subdivision would even have to consider this particular model. It is to be used for assistance and information only. We hold the circuit court properly ruled Sloan has not met his burden of establishing that any of the challenged provisions failed to meet the requirements of section 11-35-50. Sloan's sole objection to these provisions is that the Hospital Policy does not mirror the terms of the Procurement Code, the Model Procurement Ordinance, and other regional codes. Sloan appears to apply a reverse presumption, i.e., that the challenged provisions in the Hospital Policy are presumptively invalid because they vary from the terms contained in the sources used for comparison. We agree with the circuit court that this difference, standing alone, is not enough to deem the Hospital Policy in violation of the statute's mandate to adopt sound principles of appropriately competitive procurement. As our courts have recognized, section 11-35-50 does not specify any particular procedures that are considered to embody the appropriately competitive standard; rather, the statute clearly was intended to afford local governments needed flexibility to determine what is `appropriately competitive' in light of the public business they must transact. Glasscock Co. v. Sumter County, 361 S.C. 483, 490, 604 S.E.2d 718, 721 (Ct.App.2004). In Glasscock, the court rejected the argument that section 11-35-50 should be construed to mandate sealed competitive bidding in almost every instance of public procurement, explaining: This approach would effectively strip our state's local governments of any flexibility in determining the competitive procurement policies and procedures appropriate for them to adopt. Indeed, such a reading of section 11-35-50 runs wholly contrary to the home rule authority vested in local government by our constitution. Id. at 491, 604 S.E.2d at 722; cf. Charleston County Sch. Dist. v. Leatherman, 295 S.C. 264, 368 S.E.2d 76 (Ct.App.1988) (observing state law requires a school district's proposed procurement code to be substantially similar to the state Procurement Code, a requirement that is not imposed universally). Accordingly, we find no merit to Sloan's argument that the Hospital Policy is improper because it varies from the provisions contained in other local procurement and model codes.