Public Utility Districts. A public utility district (PUD) is a type of special purpose district authorized for the purpose of generating and distributing electricity, providing water and sewer services, and providing telecommunications services.

Contracts for Purchasing or Work. A PUD must contract for: 

•  any items of similar materials, equipment, or supplies estimated to cost more than $30,000;
•  any items of similar materials, equipment, or supplies estimated to cost more than $12,000, if purchased within a single calendar month; and  
•  any work ordered by a district commission estimated to cost more than $150,000 if more than a single craft or trade is involved, or $75,500 if only a single craft or trade is involved with the public works project.

Contracts are not required for work accepted as an industry practice under prudent utility management. Prudent utility management means performing work with regularly employed personnel, using material of a worth not exceeding $300,000 in value. This limit does not include the value of individual items of equipment. 

Competitive Bidding. Before awarding a contract for public works projects or for purchasing materials, equipment, or supplies, a PUD must publish advance notice to invite sealed proposals, then publicly open and read them and award the contract to the lowest responsible bidder.

As an alternative to formal competitive bidding to secure contracts, state law allows certain agencies to use vendor lists up to a certain dollar amount established in statute. The agency must advertise the existence of each vendor list at least twice a year in a newspaper of general circulation and solicit names for the list. To make a purchase using the vendor list, an agency should secure quotes from at least three of the vendors on the list, if possible, and award the contract to the lowest responsible bidder. 

Competitive bidding requirements may be waived by the municipality’s governing body for purchases from sole source suppliers, purchases involving special facilities or market conditions, purchases in the event of an emergency, purchases of insurance or bonds, and public works in the event of an emergency.

Until January 1, 2045, a separate category of work is created under PUD procurement law for electric generation facilities fueled by non-emitting or renewable resources, energy storage, or transmission or distribution projects (PUD energy projects). 

Contracts for Work. For PUD energy project work without a contract:

• the maximum dollar amount increases from $75,500 or less—single craft, or $150,000 or less—multiple craft, to $500,000 or less; and
• performed by regularly employed personnel, the maximum dollar amount of the work increases from $300,000 to $1 million or less. 

Competitive Bidding Requirements for Public Utility Districts. PUDs with a purchasing department may receive electronic bids as well as hard copy bids. 

When a PUD opens bids it may award the contract to the lowest responsive, as well as responsible, bidder based on the filed plans and specifications. 

The maximum amount a contract may be awarded for is increased from 15 percent to 25 percent in excess of the estimated cost of the materials or work. 

For contracts to purchase any item or items of the same kind of materials, equipment or supplies for PUD energy projects, in the amount of $50,000 or more but less than $250,000 per calendar month, exclusive of sales tax, PUDs may use the vendor list process. A PUD may waive the deposit or bid bond in securing bid quotations. 

Competitive Bidding Requirements for Municipalities. Competitive bid requirements may be waived for municipalities until January 1, 2045, for purchases: 

• involving any type of electric generating plants and facilities including, but not limited to, nuclear and other thermal power generating plants and facilities, renewable energy facilities, energy storage facilities, and transmission facilities; and
• relating to energy generation, storage, transmission, or distribution facilities if the governing body determines that the expedited procurement action is: 
  1. for proprietary or specialized technologies with no comparable alternatives; 
  2. necessary to ensure compliance with electrical reliability standards; and 
  3. to prevent threats to grid reliability.

PRO: The costs of providing electricity service is going up exponentially. Equipment, like transformers, are in short supply. We have significant demands on energy. We have aging infrastructure. There is a real concern for the cost of providing these services. We need to allow the PUDs to get the work done, and keep people working. We need thousands of megawatts of nameplate capacity and associated transmission and distribution assets to deliver generation to the load. This bill will help. Allowing utilities to avoid competitive bidding is expected to shave six months from the time needed to place these assets into service. The state has some of most aggressive clean energy policies but ranks last in actually getting new energy projects built. Inflationary pressures mean utilities can build less when they need to be building more.  Procurement and contracting laws were designed for a slower, less complex landscape. Today's environment demands speed, flexibility, and cost efficiency to respond to escalating material costs, supply chain constraints, and the urgency of clean energy integration. Without modernizing laws, projects will continue to stall. This bill is not a silver bullet to address resource adequacy but will allow COUs to self-perform and chip away at backlogged projects.