Purchasing and Contracting Legislative Update

Published for Coates' Canons on May 10, 2011.

The 2011 Session of the North Carolina General is in full swing, and several bills are pending that propose changes to state purchasing and contracting laws and grant purchasing and contracting flexibility for some local governments.  It is impossible to predict what the ultimate fate of these bills will be – all are currently pending as of the date of this post, and it remains to be seen which ones (if any) will become enacted into law. 

Two bills propose fairly significant changes to statewide purchasing and contracting laws.  House Bill 36 (Public Contracts/Illegal Immigrants) would prohibit state and local governments from contracting with contractors who knowingly employ illegal immigrants, and requires contractors to certify the legal status of their employees using the E-Verify system.  House Bill 172 (Encourage Military Veteran Contractor Use) would add military veteran contractors to the list of contractors for which state purchase contracting is encouraged, and requires the state to have a 10% goal of utilizing military veteran contractors for state construction projects.  The 10% goal requirement also applies to construction projects of any other entity, including local governments, costing $100,000 or more for which state funds are appropriated or granted.  The requirements for making good faith efforts to achieve military veteran contractor participation goals are similar to those currently required for other minority businesses. Several bills propose changes to state licensure requirements for contractors.  Senate Bill 405 (Amend Irrigation Contractors’ Licensing Laws) would clarify that the exemption for state and local governments from licensure requirements when performing irrigation work only applies to work performed on public property when using government employees.  Senate Bill 447 (Rewrite Landscape Contractor Laws) would require licensure (instead of registration under current law) for anyone engaging in landscape contracting and prohibits performing landscape contracting work without a license.  State and local governments performing landscaping work on public property would be exempt from licensure requirements.  House Bill 497 (Clarify Definition of General Contractor) would add to the definition of a general contractor firms performing design/build work.  Finally, House Bill 648 (Improve Enforcement/General Contractor Laws) would tighten the current exemption from general contractor licensure requirements for owners serving as their own general contractors by requiring owner-builders to submit an affidavit to the local building inspector verifying the owner’s eligibility for the exemption.  The owner’s exemption is subject to approval by the NC Licensing Board for General Contractors. A number of local bills would authorize purchasing and contracting flexibility for individual local governments, including:

  • Design/build construction in the City of Charlotte (SB56), Wayne County (HB284), Currituck County (HB284), and the Town of Cornelius (HB442)
  • Electronic bidding for informal bids in Winston-Salem (HB371)
  • Purchasing flexibility for energy efficiency purchases and renewable energy systems contracts in Mecklenburg County (HB435)
  • Small business enterprise programs for city contracts in the City of Durham (SB297)
  • Local bidding preferences (using a price match method) for resident bidders in Catawba County (SB291) (note:  Catawba County has withdrawn its request for this bill, so while the bill technically is still pending, it is not expected to be considered)
  • Clarifying contract award procedures in the Town of Mount Airy (HB516)

Several bills propose changes to purchasing and contracting by state agencies including increasing the project cost threshold for use of force account labor for university and community college construction projects (SB575); keeping bid documents submitted to DOT confidential until a contract is awarded (SB750); requiring the state to use multiple award schedule contracts for purchasing ground maintenance, construction, and forestry equipment (HB713); and requiring public schools with 50 or more students to establish a green cleaning policy and exclusively purchase environmentally sensitive cleaning products where economically feasible (HB840).  Finally, state procurement methods would be expanded to include purchases by negotiation, reverse auction, and best-value, and authorizes state government to join in cooperative purchasing plans with other units of governments (HB391); and the Joint Legislative Commission on Governmental Operations would study the reorganization of state purchasing and contracting as proposed by Governor Perdue in Executive Order 85 (HB200, Sec. 6.8). If you are interested in following the progress of any of these bills, click on the bill number in the text below and you will be linked to the bill status page on the General Assembly’s website (the bill’s status will be noted in the “History” box; to read the text of the bill, click on the most recent edition in the “Text” box).  At the end of the session, our faculty and Legislative Reporting Service staff will produce summaries of enacted legislation affecting areas of public law and government that are of special interest to state and local government officials.  Purchasing and contracting law will be one of the areas summarized, so stay tuned for this and other information once the General Assembly has adjourned.

Public Officials - Local and State Government Roles