SENATE BILL NO. 945

A bill to amend 1976 PA 451, entitled

"The revised school code,"

(MCL 380.1 to 380.1852) by adding section 1267a.

the people of the state of michigan enact:

Sec. 1267a. (1) Before entering into a contract for the provision of services to a public school academy, including, but not limited to, educational, administrative, management, or instructional services, an educational management organization shall obtain competitive bids on all the material and labor required for provision of the services.

(2) The educational management organization shall advertise for the bids required under subsection (1) by placing an advertisement for bids at least once in a newspaper of general circulation in the area where the public school academy is located and by posting an advertisement for bids for at least 2 weeks on the department of technology, management, and budget website on a page on the website maintained for this purpose or on a website maintained by the public school academy and designated by the department of technology, management, and budget for this purpose. If the department of technology, management, and budget designates a public school academy website for this purpose, the department of technology, management, and budget shall indicate this fact on its website and include a link on its website to the public school academy website.

(3) The advertisement for bids described in subsection (2) must do all of the following:

(a) Specify the date and time by which all bids must be received by the educational management organization.

(b) State that the educational management organization will not consider or accept a bid received by the educational management organization after the date and time specified for bid submission.

(c) Identify the time, date, and place of a public meeting at which the educational management organization or its designee will open and read aloud each bid received by the educational management organization by the date and time specified in subdivision (a).

(d) State that the bid must be accompanied by a sworn and notarized statement disclosing any familial relationship that exists between the owner or any employee of the bidder and any member of the educational management organization or chief administrator of the public school academy. An educational management organization shall not accept a bid that does not include this sworn and notarized disclosure statement.

(4) The educational management organization shall require each bidder for a contract under this section to file with the educational management organization a security in an amount not less than 1/20 of the amount of the bid conditioned to secure the educational management organization from loss or damage by reason of the withdrawal of the bid or by the failure of the bidder to enter a contract for performance, if the bid is accepted by the educational management organization.

(5) The educational management organization shall not open, consider, or accept a bid that the educational management organization receives after the date and time specified for bid submission in the advertisement for bids described in subsection (3).

(6) At the public meeting identified in the advertisement for bids described in subsection (3), the educational management organization or its designee shall open and read aloud each bid that the educational management organization received at or before the time and date for bid submission specified in the advertisement for bids. The educational management organization may reject any or all bids, and if all bids are rejected, the educational management organization shall readvertise in the manner required by this section.

(7) An educational management organization may adopt and implement a policy that gives preference to a Michigan-based business in awarding a contract under this section. The policy may provide for a preference based on the status of the primary contractor as a Michigan-based business or based on the status of 1 or more subcontractors of the primary contractor as Michigan-based businesses, or both. A policy adopted under this subsection must be consistent with federal statutes and regulations and must not be applied to a contract that is to be paid with federal funds. Upon request by an educational management organization that has adopted and implemented a policy described in this subsection, the department of treasury shall disclose to that educational management organization verifying information as described in section 268(3) of the management and budget act, 1984 PA 431, MCL 18.1268. The adoption, implementation, or application of a policy described in this subsection, or a decision not to adopt, implement, or apply such a policy, does not create a cause of action.

(8) A bid accepted by an educational management organization under this section must be approved by the board of directors of the public school academy for which the services will be provided at an open meeting of the board of directors, with evidence presented that the educational management organization followed the competitive bidding process as described in this section.

(9) This section does not apply to contracts for the provision of services costing less than $29,572.00. The maximum amount specified in this subsection must be adjusted each year by multiplying the amount for the immediately preceding year by the percentage by which the average consumer price index for all items for the 12 months ending August 31 of the year in which the adjustment is made differs from that index's average for the 12 months ending on August 31 of the immediately preceding year and adding that product to the maximum amount that applied in the immediately preceding year, rounding to the nearest whole dollar.

(10) A public school academy that violates this section shall forfeit an amount equal to the amount of the contract for which the competitive bidding process was not followed. The amount forfeited under this subsection must be taken from the funds due to the public school academy under article I of the state school aid act of 1979, 1979 PA 94, MCL 388.1601 to 388.1772.

(11) As used in this section:

(a) "Educational management organization" means an entity that enters into a management agreement with a public school academy.

(b) "Entity" means a partnership, nonprofit or business corporation, or any other association, corporation, trust, or other legal entity.

(c) "Management agreement" means an agreement to provide comprehensive educational, administrative, management, or instructional services or staff to a public school academy.

(d) "Michigan-based business" means a business that would qualify for a preference in a procurement contract with this state under section 268 of the management and budget act, 1984 PA 431, MCL 18.1268.