[atlas:bill]

AN ACT Relating to providing entrepreneurial opportunities for disabled persons; amending RCW 39.19.010, 39.19.020, 39.19.030, 39.19.080, 39.19.120, 39.19.150, 39.19.170, and 39.19.200; adding new sections to chapter 39.19 RCW; creating a new section; providing an effective date; and declaring an emergency.

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

NEW SECTION. Sec. 1. A new section is added to chapter 39.19 RCW to read as follows:

(1) The legislature recognizes that disabled persons contracting independently or as owners of small businesses may initially lack capital to start a business, may initially have increased costs for personal care attendants and assistive technology, and may initially have difficulty competing economically because of a disability. The legislature further recognizes that these disadvantages diminish as the business grows in size and as employees become available for support. Therefore, it is the intent of this chapter to limit participation in the program established for disabled persons' business enterprises under this chapter to newly established businesses of small size.

(2) This chapter shall not apply to disabled persons' business enterprises that:

(a) Have more than seven employees; or

(b) Have been certified under this chapter for more than nine years. However, a business that would be ineligible to participate under this subsection (2)(b) may, no later than one year after becoming ineligible, petition the office for one additional period of eligibility not exceeding nine years from the date the additional period of eligibility is granted. Before extending eligibility, the office must find that the business continues to experience significant competitive disadvantages in contracting.

Sec. 2. RCW 39.19.010 and 1987 c 328 s 1 are each amended to read as follows:

The legislature finds that ((~~minority and women-owned~~)) businesses owned and controlled by minorities, women, or disabled persons are significantly under-represented and have been denied equitable competitive opportunities in contracting. It is the intent of this chapter to mitigate societal discrimination and other factors in participating in public works and in providing goods and services and to delineate a policy that an increased level of participation by ((~~minority and women-owned and controlled~~)) businesses owned and controlled by minorities, women, or disabled persons is desirable at all levels of state government. The purpose and intent of this chapter are to provide the maximum practicable opportunity for increased participation by ((~~minority and women-owned and controlled~~)) businesses owned and controlled by minorities, women, and disabled persons in participating in public works and the process by which goods and services are procured by state agencies and educational institutions from the private sector. The legislature further finds that no court has held that a program which promotes contracting opportunities for businesses owned and controlled by disabled persons must be subjected to the strict-scrutiny standard or must be justified by a disparity study. If a court of proper jurisdiction determines that the program for disabled persons is subject to the strict-scrutiny standard or must be justified by a disparity study, the program may be suspended until the legislature determines a proper course of action.

Sec. 3. RCW 39.19.020 and 1996 c 69 s 4 are each amended to read as follows:

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) ((~~"Advisory committee" means the advisory committee on minority and women's business enterprises.~~

~~(2)~~)) "Broker" means a person that provides a bona fide service, such as professional, technical, consultant, brokerage, or managerial services and assistance in the procurement of essential personnel, facilities, equipment, materials, or supplies required for performance of a contract.

((~~(3)~~)) (2) "Director" means the director of the office of minority ((~~and~~)), women's, and disabled persons' business enterprises.

(3) "Disabled person" means a person with a physical or mental impairment that substantially limits a major life activity. The impairment must be material and medically cognizable or diagnosable. The impairment must also be permanent in that it is seldom significantly corrected by medical replacement, therapy, or surgical means. Impairment does not include drug or alcohol addiction or any negative effects brought on by the use of drugs or alcohol.

(4) "Educational institutions" means the state universities, the regional universities, The Evergreen State College, and the community colleges.

(5) "Goals" means annual overall agency goals, expressed as a percentage of dollar volume, for participation by minority and women-owned and controlled businesses and shall not be construed as a minimum goal for any particular contract or for any particular geographical area. It is the intent of this chapter that such overall agency goals shall be achievable and shall be met on a contract-by-contract or class-of-contract basis.

(6) "Goods and/or services" includes professional services and all other goods and services.

(7) "Office" means the office of minority ((~~and~~)), women's, and disabled persons' business enterprises.

(8) "Person" includes one or more individuals, partnerships, associations, organizations, corporations, cooperatives, legal representatives, trustees and receivers, or any group of persons.

(9) "Procurement" means the purchase, lease, or rental of any goods or services.

(10) "Public works" means all work, construction, highway and ferry construction, alteration, repair, or improvement other than ordinary maintenance, which a state agency or educational institution is authorized or required by law to undertake.

(11) "State agency" includes the state of Washington and all agencies, departments, offices, divisions, boards, commissions, and correctional and other types of institutions.

Sec. 4. RCW 39.19.030 and 1996 c 69 s 5 are each amended to read as follows:

There is hereby created the office of minority ((~~and~~)), women's, and disabled persons' business enterprises. The governor shall appoint a director for the office, subject to confirmation by the senate. The director may employ a deputy director and a confidential secretary, both of which shall be exempt under chapter 41.06 RCW, and such staff as are necessary to carry out the purposes of this chapter.

The office ((~~shall~~)) may consult with ((~~the~~)) a minority ((~~and~~)), women's, and disabled persons' business enterprises ad hoc advisory committee, established under RCW 39.19.041, to accomplish the purpose stated in this section.

The office shall:

(1) Develop, plan, and implement programs to provide an opportunity for participation by qualified ((~~minority and women-owned and controlled~~)) businesses owned and controlled by minorities, women, or disabled persons in public works and the process by which goods and services are procured by state agencies and educational institutions from the private sector;

(2) Develop a comprehensive plan insuring that qualified ((~~minority and women-owned and controlled~~)) businesses owned and controlled by minorities, women, or disabled persons are provided an opportunity to participate in public contracts for public works and goods and services;

(3) Identify barriers to equal participation by qualified ((~~minority and women-owned and controlled~~)) businesses owned and controlled by minorities, women, or disabled persons in all state agency and educational institution contracts;

(4) Establish annual overall goals for participation by qualified minority and women-owned and controlled businesses for each state agency and educational institution to be administered on a contract-by-contract basis or on a class-of-contracts basis;

(5) Develop and maintain a central minority ((~~and~~)), women's, and disabled persons' business enterprise certification list for all state agencies and educational institutions. No business is entitled to certification under this chapter unless it meets the definition of small business concern as established by the office. All applications for certification under this chapter shall be sworn under oath;

(6) Develop, implement, and operate a system of monitoring compliance with this chapter;

(7) Adopt rules under chapter 34.05 RCW, the Administrative Procedure Act, governing: (a) Establishment of agency goals for participation by qualified businesses owned and controlled by minorities and women; (b) development and maintenance of a central minority ((~~and~~)), women's, and disabled persons' business enterprise certification program, including a definition of "small business concern" which shall be consistent with the small business requirements defined under section 3 of the Small Business Act, 15 U.S.C. Sec. 632, and its implementing regulations as guidance; (c) procedures for monitoring and enforcing compliance with goals, regulations, contract provisions, and this chapter; (d) utilization of standard clauses by state agencies and educational institutions, as specified in RCW 39.19.050; and (e) determination of an agency's or educational institution's goal attainment consistent with the limitations of RCW 39.19.075;

(8) Submit an annual report to the governor and the legislature outlining the progress in implementing this chapter;

(9) Investigate complaints of violations of this chapter with the assistance of the involved agency or educational institution; and

(10) Cooperate and act jointly or by division of labor with the United States or other states, and with political subdivisions of the state of Washington and their respective minority, socially and economically disadvantaged ((~~and~~)), women, and disabled persons business enterprise programs to carry out the purposes of this chapter. However, the power which may be exercised by the office under this subsection permits investigation and imposition of sanctions only if the investigation relates to a possible violation of this chapter ((~~39.19 RCW~~)), and not to violation of local ordinances, rules, regulations, however denominated, adopted by political subdivisions of the state.

Sec. 5. RCW 39.19.080 and 1987 c 328 s 5 are each amended to read as follows:

(1) A person, firm, corporation, business, union, or other organization shall not:

(a) Prevent or interfere with a contractor's or subcontractor's compliance with this chapter, or any rule adopted under this chapter;

(b) Submit false or fraudulent information to the state concerning compliance with this chapter or any such rule;

(c) Fraudulently obtain, retain, attempt to obtain or retain, or aid another in fraudulently obtaining or retaining or attempting to obtain or retain certification as a minority ((or)), women's, or disabled persons' business enterprise for the purpose of this chapter;

(d) Knowingly make a false statement, whether by affidavit, verified statement, report, or other representation, to a state official or employee for the purpose of influencing the certification or denial of certification of any entity as a minority ((or)), women's, or disabled persons' business enterprise;

(e) Knowingly obstruct, impede, or attempt to obstruct or impede any state official or employee who is investigating the qualification of a business entity that has requested certification as a minority ((or)), women's, or disabled persons' business enterprise;

(f) Fraudulently obtain, attempt to obtain, or aid another person in fraudulently obtaining or attempting to obtain public moneys to which the person is not entitled under this chapter; or

(g) Knowingly make false statements that any entity is or is not certified as a minority ((or)), women's, or disabled persons' business enterprise for purposes of obtaining a contract governed by this chapter.

(2) Any person or entity violating this chapter or any rule adopted under this chapter shall be subject to the penalties in RCW 39.19.090. Nothing in this section prevents the state agency or educational institution from pursuing such procedures or sanctions as are otherwise provided by statute, rule, or contract provision.

Sec. 6. RCW 39.19.120 and 1987 c 328 s 7 are each amended to read as follows:

The office shall be the sole authority to perform certification of ((~~minority business enterprises, socially and economically disadvantaged business enterprises, and women's~~)) business enterprises owned and controlled by minorities, socially and economically disadvantaged, women, or disabled persons throughout the state of Washington. Certification by the state office will allow these firms to participate in programs for these enterprises administered by the state of Washington, any city, town, county, special purpose district, public corporation created by the state, municipal corporation, or quasi-municipal corporation within the state of Washington. The certification process for businesses owned and controlled by disabled persons will be limited to eighty applicants per year.

This state-wide certification process will prevent duplication of effort, achieve efficiency, and permit local jurisdictions to further develop, implement, and/or enhance comprehensive systems of monitoring and compliance for contracts issued by their agencies.

Sec. 7. RCW 39.19.150 and 1987 c 328 s 10 are each amended to read as follows:

(1) Any city, county, town, special purpose district, public corporation created by the state, municipal corporation, or quasi-municipal corporation having reason to believe that a particular minority ((~~and~~)), women's, or disabled persons' business enterprise should not have been certified under RCW 39.19.140 may petition the office for reconsideration. The basis for the petition may be one or more of the following:

(a) The office's rules or regulations were improperly applied; or

(b) Material facts relating to the minority ((~~and~~)), women's, or disabled persons' business enterprise's certification application to the office are untrue.

(2) The petitioner shall carry the burden of persuasion. The affected minority ((or)), women's, or disabled persons' business enterprise shall receive notice of the petition and an opportunity to respond.

(3) After reviewing the information presented in support of and in opposition to the petition, the office shall issue a written decision, granting or denying the petition. If the office grants the petition, it may revoke, suspend, or refuse to renew the certification or impose sanctions under this chapter as appropriate.

(4) The office's decision on a petition is administratively final and the rights of appeal set out in the office regulations shall apply. A certification shall remain in effect while a petition is pending.

Sec. 8. RCW 39.19.170 and 1993 c 512 s 10 are each amended to read as follows:

(1) State agencies shall not require a performance bond for any public works project that does not exceed twenty-five thousand dollars awarded to a prequalified and certified ((~~minority or woman-owned~~)) business owned and controlled by minorities, women, or disabled persons that has been prequalified as provided under subsection (2) of this section.

(2) A limited prequalification questionnaire shall be required assuring:

(a) That the bidder has adequate financial resources or the ability to secure such resources;

(b) That the bidder can meet the performance schedule;

(d) That all equipment to be used is adequate and functioning and that all equipment operators are qualified to operate such equipment.

Sec. 9. RCW 39.19.200 and 1993 c 195 s 1 are each amended to read as follows:

The minority ((~~and~~)), women's, and disabled persons' business enterprises account is created in the custody of the state treasurer. All receipts from RCW 39.19.210, 39.19.220, and 39.19.230 shall be deposited in the account. Expenditures from the account may be used only for the purposes defraying all or part of the costs of the office in administering this chapter. Only the director or the director's designee may authorize expenditures from the account. Moneys in the account may be spent only after appropriation.

NEW SECTION. Sec. 10. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 11. If any part of this act is found to be in conflict with federal requirements that are a prescribed condition to the allocation of federal funds to the state, the conflicting part of this act is inoperative solely to the extent of the conflict and with respect to the agencies directly affected, and this finding does not affect the operation of the remainder of this act in its application to the agencies concerned. The rules under this act shall meet federal requirements that are a necessary condition to the receipt of federal funds by the state.

NEW SECTION. Sec. 12. A new section is added to chapter 39.19 RCW to read as follows:

The following acts or parts of acts are each repealed, effective June 30, 2004:

(1) Section 1, chapter . . ., Laws of 1999 (section 1 of this act);

(2) Section 2, chapter . . ., Laws of 1999 (section 2 of this act);

(3) Section 3, chapter . . ., Laws of 1999 (section 3 of this act);

(4) Section 4, chapter . . ., Laws of 1999 (section 4 of this act);

(5) Section 5, chapter . . ., Laws of 1999 (section 5 of this act);

(6) Section 6, chapter . . ., Laws of 1999 (section 6 of this act);

(7) Section 7, chapter . . ., Laws of 1999 (section 7 of this act);

(8) Section 8, chapter . . ., Laws of 1999 (section 8 of this act); and

(9) Section 9, chapter . . ., Laws of 1999 (section 9 of this act).

NEW SECTION. Sec. 13. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 1999.