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| SPONSOR: | Griego | DATE TYPED: | 02/08/01 | HB | |||
| SHORT TITLE: | Procurement Appeals Board | SB | 269 | ||||
| ANALYST: | Carrillo | ||||||
| Recurring
or Non-Rec |
Fund
Affected | ||||
| FY01 | FY02 | FY01 | FY02 | ||
| See Fiscal Implications | |||||
(Parenthesis ( ) Indicate Expenditure Decreases)
SOURCES OF INFORMATION
State Highway and Transportation Department (SHTD)
Office of the Attorney General (AG)
General Services Department (GSD) - No Response
SUMMARY
Synopsis of Bill
Senate Bill 269 proposes to amend the Procurement Code by establishing a Procurement Appeals Board. The board is composed of three members, two appointed by the governor and the third is designated on a case-by-case basis by the two appointed members. The two gubernatorial appointees must be lawyers, in good standing of the State Bar for at least five years and shall be experienced in contract or commercial matters. The designated member shall possess the technical expertise and experience needed for the proper disposition of the factual issues presented by the case.
The bill provides that appeals must be filed within seven days for issues involving protested solicitation or award of contract. For appeals involving debarment, suspension or contract controversy, the appeal needs to be filed within 60 days of the decision.
No party may discontinue an appeal without prejudice except as authorized by the board.
Significant Issues
The SHTD staff notes the SHTD has in place comprehensive regulations and procedures for hearing bid protests and debarment proceedings. These regulations provide for fast and predictable administrative resolution of bid protests and debarments, and provide the opportunity for judicial review of the determinations.
FISCAL IMPLICATIONS
SB 269 provides the board members shall receive no compensation or benefits for their services. They may receive per diem and expenses incurred in the performance of the members' official duties pursuant to the Per Diem and Mileage Act.
OTHER SUBSTANTIVE ISSUES
The AG staff presents the following:
Page five, Section 13-1-176.1(H) - "appointed member may be reappointed for succeeding terms and may continue to serve after the expiration of their terms until a successor takes office" indicates members may serve unlimited terms.
Page five, Section 13-1-176.1(K) - allows only for per diem and mileage and specifically prohibits compensation. Large number of cases could be appealed to the Board. Without compensation for lawyers with this type of experience it is questionable that volunteers will come forward to serve. No suggestion of staff services to be provided.
De novo review (13-1-176.4 NMSA 1978) to be performed by Board suggests that defenses and claims may be raised for the first time with the Board and need not be addressed before the agency. Also, language stating that agency decision is not final or conclusive may have been added to ensure that all administrative remedies are exhausted before appellant pursues claims in district court, but case law already ensures this. Both sections quoted in this paragraph may have the unwitting effect of rendering agency protest, solicitation and debarment or suspension hearings since the Board has the only final authority to make these determinations.
Conflict exists within the bill itself on what cases may to Board on appeal. The Bill indicates in 13-1-176.5 (A) and (B) NMSA 1978, page 7, that the Board may hear appeals from decisions regarding a protested solicitation or award, debarment, suspension or contract controversy. Section 13-1-175 NMSA 1978 page 1, only allows appeal of protests of bids or solicitation. Section 13-1-177 NMSA 1978 only allows appeals of debarment of suspension. By mentioning contract controversy in 13-1-176.5 NMSA 1978, page 7, however, it might be assumed that all contract issues, which come before a state agency, may be appealed to the Board.
Conflict or overlap issues: The language in the Bill (Section 13-1-176.7 NMSA 1978, page 8) is not in conformance with Section 39-3-1.1 NMSA 1978 (mentioned on page 3, Section 13-1-183 NMSA 1978). The Bill says " A determination of an issue of fact by the Board shall be final and conclusive unless arbitrary and capricious or clearly erroneous. Section 39-3-1.1 NMSA 1978 allows for three reasons for the district court to set aside an agency decision: 1) the agency acted fraudulently, arbitrarily or capriciously; 2) the final decision was not supported by substantial evidence or 3) agency did not act in accordance of law. It is not clear what purpose, if any, the bill attempts in making these distinctions.
Finally, no mention in the Bill what penalties would attach should Board determine state agency in error. Current case law indicates that for protests of contract award or solicitation only cost of preparing RFP (request for proposal) is reimbursable. No damages, attorney fees, etc. Normally allowed. Would the Board also be so limited or so allowed?
WJC/njw