FINAL BILL REPORT

SHB 88

PARTIAL VETO

                                  C 414 L 87

BYHouse Committee on State Government (originally sponsored by Representatives Belcher, H. Sommers, Valle, Vekich, Cantwell, Dellwo, Hankins, Meyers, Holm, Unsoeld, Wang, Niemi, P. King, Fisch and Winsley; by request of Department of General Administration)

Revising provisions governing personal service contracts.

House Committe on State Government

Senate Committee on Governmental Operations

SYNOPSIS AS ENACTED

BACKGROUND:

Personal services contracting is a category of state purchasing that includes consulting contracts.  There is no requirement that personal services contracts be competitively let.  The authority to enter into personal services contracts is vested with each individual agency.  There is no central authority responsible for procuring these contracts, except architectural and engineering contracts that are processed and negotiated through the Department of General Administration.

Personal services contracts must be filed with the Office of Financial Management (OFM) and the Legislative Budget Committee (LBC). No personal services contract may become effective for at least ten days following the date of filing.  Any state officer or employee who fails to comply with the filing requirements pertaining to personal services contracts is subject to a $300 fine.

In 1986, a law was enacted requiring all state agencies to submit an annual report listing every personal services contract entered into or amended during the preceding fiscal year.  In addition to this legislation, a 12-agency task force appointed by the governor met to address the following concerns:  non-competitive contracting; the need for greater visibility of personal services contracts not filed with OFM or LBC; the lack of standard contracting procedures, record keeping and reporting; and the need for common definitions of terms including personal services.

SUMMARY:

Personal services contracts are defined as consultant contracts for services that provide professional and technical expertise to accomplish a specific study project, task or other work statement.  It specifically excludes purchased services and specifically includes client services.

All personal services contracts must be entered into through competitive solicitation.  Exceptions to this requirement include emergency contracts, sole source contracts, contract amendments, personal services contracts of less than $10,000 and others specifically exempted by the Office of Financial Management (OFM).  Contracts of $2,500 but less than $10,000 must show evidence of competition.

Emergency contracts must be filed with OFM and the Legislative Budget Committee (LBC) within three working days of the contract's execution or commencement of work under the contract, whichever comes first.

Sole source contracts must be filed with OFM and LBC 10 days before the proposed starting date of the contract.  OFM must approve sole source contracts of $10,000 or more before they become binding.  If an individual contractor enters into contracts with a state agency that individually are less than $10,000, but collectively are $10,000 or more during a fiscal year, any subsequent contract must be approved by OFM.

All personal services contracts entered into by the legislative branch are excluded from competitive process and filing requirements.

Penalties may be imposed against state officers and consultants for violation of requirements.

OFM will provide information to the legislative auditor on all contracts filed under this chapter for the purpose of preparing a summary report on personal service contracts.

VOTES ON FINAL PASSAGE:

      House 96   1

      Senate    44     0(Senate amended)

      House       (House refused to concur)

Free Conference Committee

      Senate    31     0

      House 97   0

EFFECTIVE:July 26, 1987

Partial Veto Summary:  The emergency clause is deleted.  (See VETO MESSAGE)