Awarding state procurements to certified disabled veteran-owned businesses, providing an exemption from emergency rule procedures, and requiring the exercise of rule-making authority

With the exception of nonhighway construction work and certain other limited exceptions, state agencies that are subject to requirements to make purchases through competitive bidding or competitive sealed proposals may accept a bid or proposal from a minority-owned business that is no more than 5 percent higher than the apparent low bid or most advantageous proposal. Unless the secretary of administration reports to the Joint Committee on Finance the reasons for not doing so, the Building Commission must ensure that at least 6 percent of the total long-term state public debt, revenue bonding, and short-term borrowing in each fiscal year is underwritten by minority-owned investment firms. The Investment Board must attempt to ensure that 5 percent of the total funds it expends for financial and investment analysis and for common stock and convertible bond brokerage commissions in each fiscal year is expended for the services of minority-owned financial advisers or minority-owned investment firms.

In addition, metropolitan sewerage commissions serving metropolitan sewerage districts that encompass first class cities, presently only Milwaukee, must attempt to ensure that 5 percent of the total funds expended for financial and investment analysis and for common stock and convertible bond brokerage commissions in each fiscal year is expended for the services of minority-owned financial advisers or minority-owned investment firms. Current law contracting provisions that apply to special purpose districts (local exposition districts, professional baseball park districts, professional football stadium districts, and cultural arts districts) also contain provisions that relate to minority and women hiring and contracting. Generally, persons awarded contracts for local exposition districts must agree that at least 25 percent of the employees hired because of the contracts will be minority group members; at least 5 percent of the employees hired will be women; at least 25 percent of the aggregate dollar value of certain contracts will be awarded to minority businesses; and at least 5 percent of the aggregate dollar value of certain contracts will be awarded to women's business. In the case of the other special districts, the minority and women contracting provisions are goals, which generally include the same participation percentages, except that the participation percentages for minority group members is 15 percent for football stadium districts and cultural arts districts.

This bill creates similar preferences in awarding state contracts or orders to disabled veteran-owned businesses certified by Commerce. The bill does not, however, create any goals for total amounts or percentages of state contracts or orders to be awarded to these businesses. The bill defines a disabled veteran as a veteran who, at the time of application for certification, is a resident of the state and is in receipt of an award from the U.S. Department of Veterans Affairs of a disability rating of at least 30 percent.

Under the bill, Commerce must certify a business, financial adviser, or investment firm that meets all of the following requirements:

1. One or more disabled veterans owns not less than 51 percent of the business, financial adviser, or investment firm or, if the business, financial adviser, or investment firm is publicly owned, 51 percent of the stock.

2. One or more disabled veterans or duly authorized representatives of the disabled veteran controls the management and daily business operations of the business, financial adviser, or investment firm.

3. The business, financial adviser, or investment firm has its principal place of business in this state.

4. The business, financial adviser, or investment firm is performing a useful business function. Useful business function is defined under the bill as the provision of materials, supplies, equipment, or services to customers, including the state.

Commerce may decertify any business, financial adviser, or investment firm that Commerce determines no longer qualifies for certification. The bill establishes an appeal process for businesses, financial advisers, or investment firms decertified by Commerce.

The bill directs the Department of Administration (DOA) to annually report to the appropriate standing committees of the legislature concerning the total amount of money and the percentage of the total amount of money paid to and the percentage of the total amount of indebtedness underwritten by disabled veteran-owned businesses, financial advisers, and investment firms. In addition, the bill directs DOA to report to the same committees, no later than March 31 of the fourth year beginning after the year in which the bill becomes law concerning DOA's recommendations for either a goal consisting of a percentage of the total amount of money that will be paid annually to disabled veteran-owned businesses, financial advisers, and investment firms by state agencies or a goal consisting of an annual percentage increase in the total amount of money that will be paid to disabled veteran-owned businesses, financial advisers, and investment firms by state agencies during at least the first full five-year period that follows the date of the report. In calculating all amounts paid to and percentages of amounts paid to businesses and firms, DOA is directed to exclude any contracts or purchases for which a purchase preference would violate a federal law or regulation or any contract between a state agency and a federal agency, or would result in a reduction in the amount of federal aids received by this state.

The Department of Transportation (DOT) administers a disadvantaged business mobilization assistance program, a loan guarantee program created to assist disadvantaged businesses in obtaining capital to participate in DOT construction contracts. Under the program, DOT may make grants to provide funding for these loan guarantees. This bill makes disabled veteran-owned businesses eligible for this program.