HB 354 -- Privatization Contracts

Co-Sponsors:  Lowe, George, Spreng, Walsh, Darrough, Wildberger,
Wilson (42)

This bill regulates the use of privatization contracts by the
state and participating political subdivisions.  The Department
of Transportation; municipal fire departments who contract with
private companies as contained in Section 85.012, RSMo; and
public bodies who contract for architectural services,
engineering services, or land surveying services are not covered.

Privatization contracts are agreements in which a non-
governmental entity agrees with a public body to provide services
valued at $25,000 or more which could have been provided by
regular employees of a public body.  The bill:

(1)  Prohibits public bodies from entering into privatization
contracts, except under the conditions of the bill;

(2)  Requires public bodies to solicit competitive sealed bids
for privatization contracts based on a written proposal.  Bid
requirements are outlined in the bill;

(3)  Requires contractors who enter into privatization contracts
to compensate employees at the rate a state employee doing
similar work would receive or the average private sector
compensation rate, whichever is greater;

(4)  Limits privatization contracts to two years;

(5)  Requires the contractor to offer available positions to
qualified public employees whose employment was terminated due to
privatization contracts;

(6)  Requires a nondiscrimination and equal opportunity provision
in all privatization contracts;

(7)  Prohibits public funds from being used to support or oppose
unionization;

(8)  Requires public bodies to prepare a comprehensive written
estimate of the cost of using regular public employees before
considering privatization contracts and a comprehensive written
contract analysis;

(9)  Requires a public body to consider a contractor's past
performance and its record of compliance with applicable laws
before awarding the contract;

(10)  Requires a public body to publicly designate the bidder to
whom it proposes to award the privatization contract;

(11)  Requires a public body to certify in writing that all
provisions of this law have been followed, the quality of
services satisfies quality requirements, the cost is at least 10%
less than if the public body had completed the services, and the
privatization contract is in the public interest;

(12)  Prohibits a privatization contractor from subcontracting
without the approval of a public body;

(13)  Requires privatization contractors and subcontractors to
file an annual financial audit with a public body;

(14)  Requires that a public body have reasonable access to
privatization contractors' project financial records, facilities,
and employees;

(15)  Requires the privatization contractor to submit an annual
report, detailing progress and quality of the project.  The
contractor must also submit a report of its compliance with all
applicable laws and findings issued by an administrative agency
or court;

(16)  Allows a public body to seek contractual remedies for any
violation of the privatization contract.  Other persons or
entities are also allowed to bring a claim against a contractor
for certain violations of the bill;

(17)  Restricts ownership rights or interest in any public record
by a privatization contractor and requires public bodies and
contractors to comply with all open records laws;

(18)  Restricts the use of privatization contract records and
contract records of a public body.  The bill outlines remedies
which may be taken for violation of these restrictions;

(19)  Prohibits retaliation against any public employee or
private contractor employee who, acting in good faith, discloses
information or participates in any investigation or proceedings
against any governmental entity relating to a violation of a
privatization contract.  The identity of any employee complaining
in good faith to a public body or elected official about a
violation of a privatization contract will be confidential; and

(20)  Requires private contractors to post provisions of the
privatization contract law and information pertaining to the
filing of a charge for the violation of certain provisions of the
bill.

The bill contains an emergency clause.

Missouri House of Representatives
Last Updated July 25, 2003 at 10:11 am