HB 1835

CS

CHAMBER ACTION

1	The State Administration Council recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5
6	A bill to be entitled
7	An act relating to procurement of contractual services by
8	an agency; amending s. 20.22, F.S.; placing the Center for
9	Efficient Government in the Department of Management
10	Services; creating s. 287.0571, F.S.; providing a popular
11	name; providing legislative intent; providing that
12	procurements of specified commodities and services are not
13	subject to the act; providing specified applicability;
14	creating s. 287.0573, F.S.; providing definitions;
15	creating s. 287.0574, F.S.; providing criteria for the
16	procurement of contractual services by an agency; creating
17	s. 287.0575, F.S.; creating the Commission on Efficient
18	Government within the Department of Management Services;
19	providing for purpose, membership, and organization of the
20	commission; providing duties and responsibilities of the
21	commission; creating the Center for Efficient Government;
22	providing purpose and organization of the center;
23	providing duties and responsibilities of the center;
24	requiring the center to recommend and implement a
25	centralized gate process for reviewing, evaluating, and
26	approving agency projects; requiring state agencies to
27	submit specified information, documents, and other
28	materials required under commission rules; creating s.
29	287.0576, F.S.; specifying procurements which must be
30	reviewed and evaluated under the centralized gate process;
31	providing minimum requirements for the centralized gate
32	process; providing for specified determinations by the
33	commission at each gate; providing procedure with respect
34	to an unfavorable finding by the commission with respect
35	to a procurement required by law; providing that agencies
36	under the individual control of the Attorney General,
37	Chief Financial Officer, or Commissioner of Agriculture
38	are subject to the act, with specified exceptions;
39	providing authority of the agency head with respect to
40	procurements by such agencies; establishing the gates
41	within the centralized gate process; requiring agencies to
42	submit specified documents for commission review at each
43	gate; providing for nullification of executed contracts
44	for procurement under specified circumstances; requiring
45	the commission to take action at each gate within a
46	specified time period; providing procedure if the
47	commission does not take action within such time period;
48	requiring the submission of annual project status reports;
49	creating s. 287.0577, F.S.; providing requirements for
50	procurement of certain contractual services; requiring an
51	agency to develop a business case which describes and
52	analyzes a contractual services procurement under
53	consideration; providing that the business case is not
54	subject to challenge or protest under the Administrative
55	Procedure Act; providing required components of a business
56	case; defining "cost" and "savings"; providing
57	requirements with respect to the solicitation for a
58	contractual services procurement; providing contract
59	requirements for a contractual services procurement;
60	providing requirements with respect to contract
61	amendments; providing that specified contract amendments
62	must be submitted to the Executive Office of the Governor
63	for approval; prohibiting the division of a contract
64	amendment to avoid specified requirements; requiring
65	documentation of contractor performance prior to renewal
66	or extension of a contract; creating s. 287.0578, F.S.;
67	providing for conditional supersession of the act;
68	amending s. 287.057, F.S.; providing a requirement with
69	respect to the composition of persons chosen to conduct
70	negotiations during a specified competitive sealed reply
71	procurement; creating s. 215.4211, F.S.; authorizing the
72	Chief Financial Officer to review contracts for state
73	agencies; creating s. 216.1817, F.S.; permitting budgetary
74	changes for a contractual services procurement only under
75	specified conditions; requiring the placement of full-time
76	equivalent positions in reserve under certain conditions;
77	providing for the reestablishment of full-time equivalent
78	positions upon termination of a contract and reversion of
79	functions and responsibilities to the agency; providing
80	that only public officers or employees must perform
81	certain functions; providing restrictions on contractor
82	involvement in the procurement of contractual services;
83	providing applicability; providing for future termination
84	of the Center for Efficient Government and the Commission
85	on Efficient Government; providing legislative intent with
86	respect to the performance of review functions and
87	assistance to agencies for procurements of contractual
88	services by state agencies after a specified date;
89	providing that positions authorized under the act shall
90	remain with the Department of Management Services after a
91	specified date; repealing s. 14.203, F.S., which creates
92	the State Council on Competitive Government and provides
93	duties and authority of the council; providing an
94	appropriation; providing full-time equivalent positions;
95	amending s. 119.0721, F.S.; removing a cross reference;
96	clarifying the meaning of "commercial activity" to conform
97	to the removal of the reference; providing an effective
98	date.
99
100	WHEREAS, the private sector can often perform services with
101	greater efficiency and effectiveness at a lower cost than the
102	state, and
103	WHEREAS, the state has long been a leader in innovative
104	practices, in part because of its partnerships with the private
105	sector, and
106	WHEREAS, the state desires to reap the benefits of lower
107	costs, high quality, and innovation by working closely with the
108	private sector, and
109	WHEREAS, the state still maintains responsibility for
110	ensuring that the services performed by the private sector on
111	behalf of the state are of high quality, cost-effective, and
112	appropriate functions for the private sector, and
113	WHEREAS, leading businesses have developed best practices
114	to determine what to obtain from the market and how to ensure
115	that such services are provided at the desired quality and at
116	the appropriate cost, and
117	WHEREAS, the executive branch has made great progress in
118	promoting the use of such best practices, and the citizens of
119	the state could benefit by the increased adoption across state
120	government of such best practices, NOW, THEREFORE,
121
122	Be It Enacted by the Legislature of the State of Florida:
123
124	Section 1.  Paragraph (i) is added to subsection (2) of
125	section 20.22, Florida Statutes, to read:
126	20.22  Department of Management Services.--There is created
127	a Department of Management Services.
128	(2)  The following divisions and programs within the
129	Department of Management Services are established:
130	(i)  Center for Efficient Government.
131	Section 2.  Section 287.0571, Florida Statutes, is created
132	to read:
133	287.0571  Applicability of ss. 287.0571-287.0578.--
134	(1)  Sections 287.0571-287.0578 shall be known as the
135	"Center for Efficient Government Act".
136	(2)  It is the intent of the Legislature that state
137	agencies focus on their core missions and deliver services
138	effectively and efficiently by leveraging resources and
139	contracting with the private sector for services that can be
140	more effectively provided by the private sector and that reduce
141	the cost of government for all citizens of the state.
142	(3)  The provisions of this act shall not apply to:
143	(a)  Procurements of commodities and contractual services:
144	1.  Listed in s. 287.057(5)(e), (f), and (g) and (22).
145	2.  Subject to s. 287.055, F.S.
146	(b)  Contracts in support of the planning, development,
147	implementation, operation, or maintenance of the road, bridge,
148	and public transportation construction program of the Department
149	of Transportation.
150	(4)  Only the provisions of ss 287.0571?287.0576 and
151	section 13 of this act shall apply to procurements governed by
152	the provisions of HB 1827 or SB 1476, 2005 Regular Session of
153	the Legislature, or similar legislation, if adopted in the same
154	legislative session or an extension thereof and enacted into
155	law.
156	Section 3.  Section 287.0573, Florida Statutes, is created
157	to read:
158	287.0573  Definitions.--For the purposes of this act:
159	(1)  "Center" means the Center for Efficient Government.
160	(2)  "Centralized gate process" means the system of review
161	phases for a proposed procurement of contractual services, the
162	conclusion of each phase being a "gate" or decision point at
163	which the commission determines whether the procurement under
164	consideration may proceed to the next phase.
165	(3)  "Commission" means the Commission on Efficient
166	Government.
167	Section 4.  Section 287.0574, Florida Statutes, is created
168	to read:
169	287.0574  Criteria for procurement of contractual
170	services.--When compared to the cost and quality of service
171	performed by state employees, an agency may procure a
172	contractual service currently or previously provided by state
173	employees only if, upon full implementation of a procurement,
174	it:
175	(1)  Results in reasonable cost savings while maintaining
176	at least the same quality of service;
177	(2)  Reasonably increases the quality of service while not
178	exceeding the same level of cost; or
179	(3)  Minimally increases the cost while significantly
180	increasing the quality by introducing specific new service
181	elements that address quantifiable needs of the state or by
182	substantially improving performance of existing service elements
183	over current performance by the state or contractor.  Only
184	projects with an annual cost below $10 million in each fiscal
185	year may meet this criterion.  This subsection shall expire on
186	July 1, 2006.
187	Section 5.  Section 287.0575, Florida Statutes, is created
188	to read:
189	287.0575  Commission on Efficient Government; membership;
190	duties; Center for Efficient Government; duties.--
191	(1)  The Commission on Efficient Government is created
192	within the Department of Management Services to oversee the
193	Center for Efficient Government and carry out the
194	responsibilities specified in this section.
195	(a)  The commission shall consist of seven members
196	appointed by the Governor:
197	1.  Four members shall be heads of executive branch
198	agencies appointed by the Governor.
199	2.  Three members shall be from the private sector and,
200	collectively, shall have experience with procurement,
201	successfully increasing operational efficiency, and implementing
202	complex projects in the private sector business environment. No
203	private sector member of the commission may at any time during
204	his or her appointment to the commission be registered to lobby
205	the executive or legislative branch.
206	(b)  By August 1, 2005, the Governor shall appoint two
207	private sector members and two agency heads for terms of 3 years
208	and one private sector member and two agency heads for terms of
209	4 years. Thereafter, each member shall serve for a term of 4
210	years. The private sector members shall serve without
211	compensation but shall be entitled to reimbursement for per diem
212	and travel expenses pursuant to s. 112.061.
213	(c)  No member of the commission shall participate in
214	commission review of a procurement when his or her agency is
215	involved in the procurement or, in the case of a private sector
216	member, he or she has a business relationship with an entity
217	that is involved or reasonably could potentially be involved in
218	the procurement.
219	(d)  The members of the commission may not delegate their
220	membership to a designee.
221	(e)  A quorum shall consist of at least four members,
222	including at least two private-sector members. At least one
223	private-sector member must vote on the prevailing side for
224	commission action to take effect.
225	(f)  Any vacancy on the commission shall be filled in the
226	same manner as the original appointment, and any member
227	appointed to fill a vacancy occurring for a reason other than
228	the expiration of a term shall serve only for the unexpired term
229	of the member's predecessor.
230	(g)  At the first meeting of the commission after August 1,
231	2005, the members of the commission shall elect, by majority
232	vote of those in attendance, a member to serve as chair of the
233	commission. No later than September 1 of each succeeding year,
234	the commission shall elect a new chair.
235	(h)  The commission shall:
236	1.  Oversee the Center for Efficient Government.
237	2.  Adopt the centralized gate process.
238	3.  Review, evaluate, grant approval of, withhold approval
239	of, or deny approval of a proposed procurement at each gate
240	established within the centralized gate process. The commission
241	shall adopt rules regarding the procurements that must pass
242	through the centralized gate process. Such procurements shall
243	include, at a minimum, those subject to the requirements of s.
244	287.0576(1).
245	4.  Approve templates and guidelines and adopt rules
246	prescribing standards and procedures for use by agencies during
247	the procurement process which shall, at a minimum, include the
248	requirements under ss. 287.0576-287.0577 for procurements of
249	contractual services.
250	5.  Implement a plan for providing information and
251	documentation to the Legislature and the Governor on behalf of
252	agencies and in compliance with the provisions of this chapter.
253	The plan shall include, at a minimum, providing copies of
254	documents to be reviewed by the commission to the President of
255	the Senate, the Speaker of the House of Representatives, the
256	Governor, and the chairs of the relevant appropriations and
257	substantive legislative committees at least 14 days prior to the
258	meeting of the commission at which the proposed procurement will
259	be discussed.
260	6.  Review the performance of procurements which have
261	advanced through the full centralized gate process.
262	(2)  The Center for Efficient Government is created in the
263	department to establish and promote best business practices so
264	that the delivery of services to citizens of the state are
265	provided in the most effective and cost-efficient manner
266	possible. The secretary of the department shall appoint a
267	director of the center. The duties and responsibilities of the
268	center are:
269	(a)  Recommending and implementing a centralized gate
270	process for reviewing, evaluating, and approving agency
271	procurements which, at a minimum, shall include the requirements
272	contained in s. 287.0576(1) and (2) for contractual services
273	procurements.
274	(b)  Providing support and assistance to the commission,
275	including, but not limited to, reviewing and validating agency
276	business cases, recommending standards, processes, templates,
277	and guidelines for use by agencies during the procurement
278	process and providing information and documentation as requested
279	or required by law.
280	(c)  Assisting agencies directly in the procurement process
281	as needed to ensure a high-quality procurement, including, but
282	not limited to, developing and updating business cases, drafting
283	solicitation and contract documents, participating in contract
284	negotiations, identifying performance measures, and advising
285	agencies on performance measurement, contract management, and
286	change management. The center shall also provide information,
287	training, and technical assistance to agencies on the use of the
288	standards, processes, templates, and guidelines developed for
289	use by agencies during the procurement process.
290	(d)  Collecting data and information from agencies on an
291	ongoing basis with regard to the status and results of
292	procurements that have advanced completely through the
293	centralized gate process, recommending incorporation of any
294	lessons learned from such projects into commission standards,
295	procedures, templates, and guidelines, as appropriate, and
296	identifying and disseminating to agencies information regarding
297	best practices in procurement, particularly contractual services
298	procurements.
299	(e)  Developing and implementing, in consultation with the
300	Agency for Workforce Innovation, guidelines for assisting
301	employees whose jobs are eliminated as a result of procurements.
302	(3)  The department shall employ an adequate number of
303	highly skilled, credentialed staff who collectively possess
304	significant expertise and experience as required to carry out
305	the responsibilities of this act.
306	(4)  Agencies shall submit to the center all information,
307	documents, or other materials required by commission rule or
308	this chapter.
309	Section 6.  Section 287.0576, Florida Statutes, is created
310	to read:
311	287.0576  Review and analysis of proposed procurement of
312	contractual services; centralized gate process.--
313	(1)  At a minimum, procurements required to undergo review
314	and analysis through the centralized gate process adopted by the
315	commission are:
316	(a)  Contractual services procurements that have an
317	estimated total cost of $10 million or more in any fiscal year.
318	(b)  New contractual services procurements that will
319	require adjustments to the agency's budget in accordance with
320	chapter 216. Amendments to existing contracts are excluded.
321	(c)  Contractual services procurements that do not involve
322	an outlay of state funds estimated to total $10 million or more
323	in any fiscal year because of the provision of services by the
324	contractor at a rate significantly below market rate, the
325	significant investment of other resources by the agency, or
326	other reason, but in which the total value of the services
327	performed by the agency and contractor under the contract is
328	estimated to total $10 million or more in any fiscal year.
329	Examples of such procurements include, but are not limited to,
330	free, no-cost, or codevelopment contracts.
331	(d)  Contractual services procurements for which the sum of
332	gross revenues or shared savings to be generated for the state
333	and contractor over the term of the contract plus the sum of any
334	payments to the contractor by the agency over the term of the
335	contract, if any, is estimated to total $10 million or more in
336	any fiscal year.
337	(e)  Contractual services procurements that do not meet the
338	criteria in paragraphs (a)-(d) that the Legislature has directed
339	to be subject to the centralized gate process.
340	(2)  Extensions and renewals of contracts resulting from
341	procurements in subsection (1) and extensions and renewals of
342	contracts meeting the criteria identified in paragraphs (1)(a),
343	(c), and (d) which did not pass through the center and were in
344	effect on the effective date of this act shall undergo review
345	and analysis through the centralized gate process implemented by
346	the center, through, notwithstanding any law to the contrary,
347	such contracts shall pass only through such gates as the
348	commission determines are appropriate based on the legislative
349	intent of this act.
350
351	For purposes of determining whether a procurement meets the
352	requirements of this section, multiple contractual services
353	procurements for substantially similar or related functions or
354	responsibilities occurring in a coordinated fashion or in close
355	time proximity to one another are considered a single
356	contractual services procurement for purposes of meeting the
357	thresholds set forth in this section.
358	(3)  The centralized gate process shall require, at a
359	minimum, review of the procurement by the commission at each
360	gate. At each gate, the commission shall determine by majority
361	vote to:
362	(a)  Approve the procurement, if the agency has
363	sufficiently met the requirements of the current gate, and
364	advance the procurement to the next phase;
365	(b)  Withhold approval of the procurement, if additional
366	work must be completed in order to satisfy the requirements of
367	the current gate, and retain the procurement in that phase; or
368	(c)  Deny the procurement, if the procurement is not a good
369	business decision, and remove the procurement from
370	consideration.
371
372	Notwithstanding the provisions of this section, the commission
373	may not deny procurements which are required by law. If the
374	commission determines that a procurement required by law is not
375	a good business decision, the commission shall withhold approval
376	and transmit to the President of the Senate, the Speaker of the
377	House of Representatives, and the Governor the reasons why the
378	procurement should not be completed and any recommendation for
379	legislative action. If the President of the Senate or the
380	Speaker of the House of Representatives has not responded within
381	14 business days of receipt of the communication, the commission
382	shall proceed at its discretion.
383
384	Notwithstanding any law to the contrary, agencies under the
385	individual control of the Attorney General, the Chief Financial
386	Officer, or the Commissioner of Agriculture are subject to the
387	provisions of this act, except that the commission shall not
388	grant, withhold, or deny approval of a procurement by such
389	agency but instead may only provide recommendations to the
390	agency. The respective agency head shall have sole authority to
391	grant, withhold, or deny approval of such procurement.
392	(4)  The gates and required documentation comprising the
393	centralized gate process shall, at a minimum, consist of:
394	(a)  The proposal identification gate, which shall include
395	the business case.
396	(b)  The procurement preparation gate, which shall include
397	the updated business case and the solicitation documents prior
398	to the issuance of such documents. An agency may not release
399	solicitation documents without the commission's approval at this
400	gate. The commission must review and approve the written
401	determination of the agency required pursuant to s.
402	287.057(3)(a) before granting approval for the use of an
403	invitation to negotiate, or withhold approval pending submission
404	by the agency of an acceptable alternative solicitation method.
405	(c)  The contract development gate, which shall include the
406	final business case and the proposed unexecuted contract. An
407	agency may not execute the contract without the commission's
408	approval at this gate.
409	(d)  The transition management gate, which shall include
410	updates to the final business case and, for a procurement of
411	contractual services, an analysis of the agency's and
412	contractor's readiness for the contractor to perform the
413	proposed responsibility or function. An agency may not
414	transition to contractor performance without the commission's
415	approval at this gate.
416	(e)  The post-implementation gate, which shall include
417	updates to the final business case and a report on the adequacy
418	of contractor performance.
419	(5)(a)  Any executed contract for a procurement passing
420	through the centralized gate process pursuant to this section
421	shall be null and void if an agency fails to comply with the
422	commission decision at the proposal identification, procurement
423	preparation, or contract development gate.
424	(b)  Failure to comply with any other requirements of this
425	act or implementing rules shall not affect the validity of the
426	competitive solicitation and award process or any contract.
427	(6)  The commission shall take action at each gate within
428	60 days of the submission of a procurement by an agency.  If the
429	commission does not take action within this timeframe, the
430	agency head shall determine whether to grant, withhold, or deny
431	approval of the procurement at that gate based on the rules and
432	guidelines of the commission for that gate and shall notify the
433	Governor, the President of the Senate, the Speaker of the House
434	of Representatives, and the commission of such action and the
435	circumstances thereof.
436	(7)  During the term of the contract, the agency shall
437	annually submit with its legislative budget request a project
438	status report for each procurement that has passed through at
439	least the first three gates of the centralized gate process
440	describing the progress made to date, actual completion dates in
441	comparison to planned completion dates, actual costs incurred in
442	comparison to projected costs incurred, current issues requiring
443	resolution, planned project milestones, deliverables, and
444	expenditures for the next reporting period, and any other
445	information relating to the contractual services that may be
446	requested.
447	Section 7.  Section 287.0577, Florida Statutes, is created
448	to read:
449	287.0577  Requirements for procurement of certain
450	contractual services.--In addition to the other applicable
451	requirements of this chapter, an agency shall comply with the
452	following requirements for, at a minimum, procurements of
453	contractual services estimated to total $1 million or more in
454	any fiscal year and those subject to review under s.
455	287.0576(1)(b), (c), (d), and (e) and (2):
456	(1)  BUSINESS CASE.--The agency shall develop a business
457	case which describes and analyzes the procurement. The business
458	case is not subject to challenge or protest pursuant to chapter
459	120. The business case shall include, but not be limited to, the
460	information in paragraphs (a)-(l). For procurements subject to
461	commission review, the business case shall be in such detail as
462	is appropriate given the current phase of the procurement but
463	shall contain sufficient information to enable the commission to
464	determine at that gate whether the procurement may proceed to
465	the next procurement phase:
466	(a)1.  A detailed description of the function or
467	responsibility for which the procurement is proposed;
468	2.  If the agency is currently performing the function or
469	responsibility, a description and analysis of the agency's
470	current performance, including, but not limited to, baseline
471	costs and performance metrics;
472	3.  The goals desired to be achieved through the
473	procurement and the rationale for such goals; and
474	4.  A citation of the existing or proposed legal authority
475	for contracting for the function or responsibility.
476	(b)1.  A description of available options for achieving the
477	goals. If state employees are currently performing the function
478	or responsibility, at least one option involving maintaining
479	state provision of the function or responsibility shall be
480	included.
481	2.  A description of the current market for the contractual
482	services which are under consideration for procurement.
483	3.  An analysis of the advantages and disadvantages of each
484	option, including, at a minimum, potential performance
485	improvements and risks.
486	(c)  A cost-benefit analysis documenting the direct and
487	indirect specific baseline costs, savings, and qualitative and
488	quantitative benefits involved in or resulting from the
489	implementation of the recommended option or options. Such
490	analysis shall specify the schedule that, at a minimum, must be
491	adhered to in order to achieve the estimated savings. All
492	elements of cost shall be clearly identified in the cost-benefit
493	analysis, described in the business case, and supported by
494	applicable records and reports. The agency head shall attest
495	that, based on the data and information underlying the business
496	case, to the best of his or her knowledge, all projected costs,
497	savings, and benefits are valid and achievable. "Cost" means the
498	reasonable, relevant, and verifiable cost which may include, but
499	not be limited to, elements such as personnel costs, materials
500	and supplies, services, equipment, capital depreciation costs,
501	rent, maintenance and repairs, utilities, insurance, personnel
502	travel, overhead, and interim and final payments. The
503	appropriate elements shall depend on the nature of the specific
504	initiative. "Savings" means the difference between the direct
505	and indirect actual annual baseline costs compared to the
506	projected annual cost for the contracted functions or
507	responsibilities in any succeeding state fiscal year during the
508	term of the contract.
509	(d)  A description of variance among agency policies and
510	processes and, as appropriate, a discussion of options for or a
511	plan to standardize, consolidate, or revise current policies and
512	processes, if any, to reduce the customization of any proposed
513	solution that would otherwise be required.
514	(e)  A description of the specific performance standards
515	that must, at a minimum, be met to ensure adequate performance.
516	(f)  A statement of the potential impact on federal, state,
517	and local revenues and expenditures. The statement shall
518	specifically describe the effect on general revenue, trust
519	funds, general revenue service charges, and interest on trust
520	funds together with the potential direct or indirect effect on
521	federal funding and cost allocations.
522	(g)  The projected timeframe for key events, from the
523	beginning of the procurement process through the expiration of a
524	contract.
525	(h)  A plan to ensure compliance with public records law
526	which must include components that:
527	1.  Provide public access to public records at a cost that
528	does not exceed that provided in chapter 119.
529	2.  Ensure the confidentiality of records that are exempt
530	or confidential under law.
531	3.  Meet all legal requirements for record retention
532	provided by law.
533	4.  Require transfer to the state, at no cost, of all
534	public records in possession of the contractor upon termination
535	of the contract.
536	(i)  A specific and feasible contingency plan addressing
537	contractor nonperformance and a description of the tasks
538	involved in and costs required for its implementation.
539	(j)  An agency transition plan for addressing changes in
540	the number of agency personnel, affected business processes,
541	employee transition issues, and communication with affected
542	stakeholders, such as agency clients and the public. The
543	transition plan shall contain a reemployment and retraining
544	assistance plan for employees who are not retained by the agency
545	or employed by the contractor.
546	(k)  A listing of any assets proposed for surplus or use by
547	a contractor. For those assets proposed to be used by a
548	contractor, the business case shall include a description of the
549	proposed requirements for maintaining those assets by the
550	contractor or the agency in accordance with chapter 273, a plan
551	for the transitioning of the assets upon termination of the
552	contract, and a description of how the planned use by a
553	contractor is in the best interest of the agency and state.
554	(l)  A plan for ensuring access by persons with
555	disabilities in compliance with applicable state and federal
556	law.
557
558	If a contractual services procurement meets the criteria for
559	submission of feasibility study documentation as required by the
560	legislative budget request instructions established pursuant to
561	s. 216.023, the agency shall submit such documentation.
562	(2)  SOLICITATION REQUIREMENTS.--The solicitation for a
563	contractual services procurement shall include, at a minimum:
564	(a)  A detailed description of the function or
565	responsibility under consideration for contracting and, if the
566	function or responsibility is currently being performed by an
567	agency, a description and analysis of the agency's current
568	performance.
569	(b)  Requirements that are achievable, unambiguous,
570	measurable, meaningful, and complete.
571	(c)  The criteria that after contract execution will be
572	used to assess contractor performance and the minimum acceptable
573	contractor performance levels.
574	(3)  CONTRACT.--Each contract must include, but need not be
575	limited to:
576	(a)  A detailed scope of work that clearly specifies each
577	service or deliverable to be provided, including a description
578	of each deliverable or activity that is quantifiable,
579	measurable, and verifiable.
580	(b)  All service-level agreements describing all services
581	to be provided under the terms of the agreement, the agency's
582	service requirements and performance objectives, and specific
583	responsibilities of the agency and the contractor.
584	(c)  Associated costs and savings, specific payment terms
585	and payment schedule, including incentive and disincentive
586	provisions, criteria governing payment, and a clear and specific
587	implementation schedule that will be implemented in order to
588	complete all required activities needed to transfer the service
589	from the agency to the contractor and operate the service
590	successfully.
591	(d)  Clear and specific identification of all required
592	performance standards, which must include, at a minimum:
593	1.  Detailed measurable acceptance criteria for each
594	deliverable and service to be provided to the agency under the
595	terms of the contract which document the required performance
596	level.
597	2.  A method for monitoring and reporting progress in
598	achieving specified performance standards and levels.
599	3.  The sanctions or disincentives that shall be assessed
600	for nonperformance by the contractor or agency.
601	(e)  A requirement that the contractor maintain adequate
602	accounting records that comply with all applicable federal and
603	state laws and generally accepted accounting principles.
604	(f)  A requirement authorizing state access to and audit of
605	all records related to the contract or any responsibilities or
606	functions under the contract for state audit and legislative
607	oversight purposes and a requirement for service organization
608	audits in accordance with professional auditing standards, if
609	appropriate.
610	(g)  A requirement describing the timing and substance of
611	all plans and status or progress reports that are to be
612	provided. All plans and status or progress reports must comply
613	with any relevant state and federal standards.
614	(h)  A requirement that the contractor comply with public
615	records laws. The contractor must:
616	1.  Keep and maintain the public records that ordinarily
617	and necessarily would be required by the state agency in order
618	to perform the function or service.
619	2.  Provide the public with access to such public records
620	on the same terms and conditions that the state agency would and
621	at a cost that does not exceed that provided in chapter 119.
622	3.  Ensure the confidentiality of records that are exempt
623	from public disclosure or made confidential under law.
624	4.  Meet all requirements for retaining records and
625	transfer to the state, at no cost, all public records in
626	possession of the contractor upon termination of the contract
627	and destroy any duplicate public records which are exempt and
628	confidential. All records stored electronically must be provided
629	to the state in a format that is compatible with information
630	technology systems of the state.
631	(i)  A requirement that any state funds provided for the
632	purchase of or improvements to real property be made contingent
633	upon the contractor granting to the state a security interest in
634	the property which is at least equal to the amount of the state
635	funds provided for the most recent years following the date of
636	purchase or the completion of improvements, or as otherwise
637	required by law. The contract must include a provision that, if
638	the contractor disposes of the property before the agency's
639	interest is vacated, the contractor will refund the
640	proportionate share of the state's initial investment, as
641	adjusted by depreciation.
642	(j)  If a contract involves the development or creation of
643	intellectual property, the contract must specify the ownership
644	of such intellectual property and any rights of the state to
645	use, modify, reproduce, or disseminate the intellectual
646	property.
647	(k)  A provision that the contractor annually submit and
648	verify, pursuant to s. 92.525, all required financial
649	statements.
650	(l)  A requirement that the contractor shall interview and
651	consider for employment with the contractor each displaced state
652	employee who is interested in such employment.
653	(m)  Provisions requiring that venue for any action
654	regarding the contract shall be in Leon County and that the
655	contract shall be interpreted according to the laws of this
656	state.
657	(4)  AMENDMENTS.--An agency may not amend a contract
658	without first submitting the proposed contract amendment to the
659	Executive Office of the Governor for approval if the effect of
660	the amendment would be to:
661	(a)  Increase the value of the contract by $1 million or
662	more for those contracts with a total value of at least $1
663	million but less than $10 million; or
664	(b)  Increase the value of the contract by 10 percent or
665	more for those contracts with a total value of $10 million or
666	more.
667
668	An agency shall not divide a contract amendment so as to avoid
669	the requirements of this section.
670	(5)  In addition to the requirements of subsections
671	287.057(13) and (14), prior to the renewal or extension of a
672	contract, an agency shall document whether all specific direct
673	and indirect costs, savings, performance standards, and
674	qualitative and quantitative benefits identified in the contract
675	have been met by the contractor and the agency. If the actual
676	performance of the contractor does not meet the required
677	performance as identified in the contract, the agency shall
678	explain the reasons why and provide justification for the
679	extensions or renewal of the contract. This documentation shall
680	be included in the official contract file.
681	Section 8.  Section 287.0578, Florida Statutes, is created
682	to read:
683	287.0578  Subsequent inconsistent laws.--Subsequent
684	inconsistent laws shall supersede this act only to the extent
685	they do so by express reference to this section.
686	Section 9.  Paragraph (b) of subsection (17) of section
687	287.057, Florida Statutes, is amended to read:
688	287.057  Procurement of commodities or contractual
689	services.--
690	(17)  For a contract in excess of the threshold amount
691	provided in s. 287.017 for CATEGORY FOUR, the agency head shall
692	appoint:
693	(b)  At least three persons to conduct negotiations during
694	a competitive sealed reply procurement who collectively have
695	experience and knowledge in negotiating contracts, contract
696	procurement, and the program areas and service requirements for
697	which commodities or contractual services are sought. When the
698	annual value of a contract is in excess of $1 million, at least
699	one of the persons conducting negotiations must be certified as
700	a contract negotiator based upon rules adopted by the Department
701	of Management Services.
702	Section 10.  Section 215.4211, Florida Statutes, is created
703	to read:
704	215.4211  Review of contracts for state agencies.--The
705	Chief Financial Officer may request, as he or she deems
706	necessary, the option to review and provide comments prior to
707	the execution of any contract that is required to be in
708	compliance with the provisions of s. 287.0577(3).
709	Section 11.  Section 216.1817, Florida Statutes, is created
710	to read:
711	216.1817  Limitation on budgetary changes for contractual
712	services procurement; placement of positions in reserve; re-
713	establishment of positions.--Notwithstanding s. 216.351:
714	(1)  Any budgetary changes for a contractual services
715	procurement that are inconsistent with the agency's approved
716	budget may not be made to existing programs unless such changes
717	are recommended to the Legislative Budget Commission by the
718	Governor, and the Legislative Budget Commission expressly
719	approves such program changes.
720	(2)  If a procurement of contractual services involves the
721	performance of functions or responsibilities that are being
722	shifted from state employees to a contractor, the agency shall
723	identify within the business case prepared pursuant to s.
724	287.0577 all resources which are affected, including full-time
725	equivalent positions. All full-time equivalent positions
726	identified in the business case shall be placed in reserve by
727	the Executive Office of the Governor until the end of the second
728	year of the contract.  However, in the business case, the agency
729	may account for any savings from the full-time equivalent
730	positions identified and held in reserve.  Notwithstanding the
731	provisions of s. 216.262, the Executive Office of the Governor
732	shall request authority from the Legislative Budget Commission
733	to reestablish full-time equivalent positions above the number
734	fixed by the Legislature if a contract is terminated and the
735	performance of the functions or responsibilities must be
736	returned to the agency.
737	Section 12.  Only a public officer or a public employee
738	upon whom the public officer has delegated authority shall,
739	consistent with law, take actions including, but not limited to:
740	(1)  Commissioning, appointing, or selecting state officers
741	or employees;
742	(2)  Approving position descriptions, performance
743	standards, or salary adjustments for state employees; and
744	(3)  Hiring, promoting, disciplining, demoting, and
745	dismissing a state employee.
746	Section 13.  A contractor, as defined in chapter 287,
747	Florida Statutes, or its employees, agents, or subcontractors,
748	may not knowingly participate, through decision, approval,
749	disapproval, preparation of any part of a purchase request,
750	investigation, or auditing, in the procurement of contractual
751	services by an agency from an entity in which the contractor, or
752	its employees, agents, or subcontractors has a material
753	interest.  This section shall not apply to pre-bid conferences
754	or requests for information conducted pursuant to chapter 287,
755	Florida Statutes.
756	Section 14.  The Center for Efficient Government and the
757	Commission on Efficient Government shall terminate on July 1,
758	2010, unless reenacted by the Legislature prior to that date. It
759	is the intent of the Legislature that, beginning July 1, 2010,
760	the various state agencies shall perform the review functions
761	required under this act for procurements of contractual services
762	under their jurisdiction. It is also the intent of the
763	Legislature that beginning July 1, 2010, the positions
764	authorized by this act shall remain with the Department of
765	Management Services, which shall continue providing technical
766	assistance as required in this act.
767	Section 15.  Section 287.0572, Florida Statutes, is
768	renumbered as section 287.0579, Florida Statutes:
769	287.0579 287.0572  Present-value methodology.--
770	(1)  The cost of bids, proposals, or replies for state
771	contracts that include provisions for unequal payment streams or
772	unequal time payment periods shall be evaluated using present-
773	value methodology. Each agency, as defined in s. 287.012(1),
774	shall perform the evaluation using the present-value discount
775	rate supplied by the department. The present-value discount rate
776	shall be the rate for United States Treasury notes and bonds
777	published in the Interest Rates: Money and Capital Markets
778	section of the most recent copy of the Federal Reserve Bulletin
779	published at the time of issuance of the request for proposals,
780	the invitation to negotiate, or the invitation to bid.
781	(2)  The department may adopt rules to administer
782	subsection (1).
783	Section 16.  Subsection (3) of section 119.0721, Florida
784	Statutes, is amended to read:
785	119.0721  Social security number exemption.--
786	(3)  An agency shall not deny a commercial entity engaged
787	in the performance of a commercial activity, which, for purposes
788	of this subsection, means an activity that provides a product or
789	service that is available from a private source as defined in s.
790	14.203 or its agents, employees, or contractors access to social
791	security numbers, provided the social security numbers will be
792	used only in the normal course of business for legitimate
793	business purposes, and provided the commercial entity makes a
794	written request for social security numbers, verified as
795	provided in s. 92.525, legibly signed by an authorized officer,
796	employee, or agent of the commercial entity. The verified
797	written request must contain the commercial entity's name,
798	business mailing and location addresses, business telephone
799	number, and a statement of the specific purposes for which it
800	needs the social security numbers and how the social security
801	numbers will be used in the normal course of business for
802	legitimate business purposes. The aggregate of these requests
803	shall serve as the basis for the agency report required in
804	subsection (7). An agency may request any other information as
805	may be reasonably necessary to verify the identity of the entity
806	requesting the social security numbers and the specific purposes
807	for which such numbers will be used; however, an agency has no
808	duty to inquire beyond the information contained in the verified
809	written request. A legitimate business purpose includes
810	verification of the accuracy of personal information received by
811	a commercial entity in the normal course of its business; use in
812	a civil, criminal, or administrative proceeding; use for
813	insurance purposes; use in law enforcement and investigation of
814	crimes; use in identifying and preventing fraud; use in
815	matching, verifying, or retrieving information; and use in
816	research activities. A legitimate business purpose does not
817	include the display or bulk sale of social security numbers to
818	the general public or the distribution of such numbers to any
819	customer that is not identifiable by the distributor.
820	Section 17.  Section 14.203, Florida Statutes, is repealed.
821	Section 18.  There is hereby appropriated $1,023,554
822	recurring budget authority to the Department of Management
823	Services from the General Revenue Fund, and nine full-time
824	equivalent positions are authorized, to carry out the activities
825	of the Center for Efficient Government and the Commission on
826	Efficient Government as provided in this act.
827	Section 19.  This act shall take effect July 1, 2005.

CODING: Words stricken are deletions; words underlined are additions.