REPORT TITLE:
Procurement

DESCRIPTION:
Amends various provisions of the Hawaii public procurement code
to consolidate and clarify sections in the chapter; amends or
repeals related sections of the HRS to bring them into compliance
with the code. (SD2)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        985
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 1999                                S.D. 2
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO PROCUREMENT.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Chapter 103, Hawaii Revised Statutes, is amended
 
 2 by adding to part I a new section to be appropriately designated
 
 3 and to read as follows:
 
 4      "103-     Definitions.  The definitions of chapter 103D
 
 5 shall apply to this chapter unless the context clearly requires
 
 6 otherwise."
 
 7      SECTION 2.  Chapter 103D, Hawaii Revised Statutes, is
 
 8 amended by adding to part IV four new sections to be
 
 9 appropriately designated and to read as follows:
 
10      "103D-     Indigenous and Polynesian introduced plants; use
 
11 in public landscaping.  (a)  Wherever and whenever feasible, all
 
12 plans, designs, and specifications for new or renovated
 
13 landscaping of any building, complex of buildings, facility,
 
14 complex of facilities, or housing developed by the State with
 
15 public moneys shall incorporate indigenous land plant species as
 
16 defined in section 195D-2, and plant species brought to Hawaii by
 
17 Polynesians before European contact, such as the kukui, noni, and
 
18 coconut; provided that:
 
19      (1)  Suitable cultivated plants can be made available for
 

 
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 1           this purpose without jeopardizing wild plants in their
 
 2           natural habitat; and
 
 3      (2)  Wherever and whenever possible, indigenous plants shall
 
 4           be used for landscaping on the island or islands on
 
 5           which the species originated.
 
 6      (b)  Each plant or group of plants used pursuant to
 
 7 subsection (a) shall be clearly identified with signs for the
 
 8 edification of the general public.
 
 9      103D-     Provisions for pollution control.  All contracts
 
10 shall make provisions for control of pollution when encountered
 
11 in the performance of the contract.
 
12      103D-     Energy efficiency through life-cycle costing.
 
13 (a) The procurement practices of the State shall include energy
 
14 efficient standards and policies, including life-cycle costing.
 
15      (b)  In implementing life-cycle costing, the purchasing
 
16 agency shall be guided by energy efficiency standards and
 
17 policies for purchasing various items developed and promulgated
 
18 by the United States Department of Energy and other federal
 
19 agencies, and nationally recognized trade associations, including
 
20 but not limited to the National Association of State Purchasing
 
21 Officials, the National Institute of Governmental Purchasing,
 
22 Inc., the National Association of Purchasing Management, and the
 
23 Air Conditioning and Refrigeration Institute.  The purchasing
 

 
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 1 agency shall notify bidders of information, procedures, and forms
 
 2 required in implementing energy efficiency standards and
 
 3 policies.  The information required shall include purchasing
 
 4 standards and policies developed by federal agencies and by
 
 5 nationally recognized agencies and associations, as well as
 
 6 energy consumption and life-cycle cost data.
 
 7      (c)  The purchasing agency shall consider purchasing via the
 
 8 life-cycle costing method those classes of items for which
 
 9 nationally recognized energy efficiency data have been developed.
 
10 These items shall include but not be limited to automobiles and
 
11 air conditioning systems.  The watt-saving variety of
 
12 common-sized fluorescent lamps shall be purchased except where
 
13 standard wattage of those lamps is specifically required by the
 
14 using agency.
 
15      103D-     Value engineering clauses.  The State shall
 
16 insert clauses providing for value engineering incentives in all
 
17 public works contracts for amounts in excess of $250,000.  The
 
18 clauses shall provide:
 
19      (1)  That cost reduction proposals submitted by contractors:
 
20           (A)  Must require, in order to be applied to the
 
21                contract, a change order thereto; and
 
22           (B)  Must result in savings to the State or county, as
 

 
 
 
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 1                the case may be, by providing less costly items
 
 2                than those specified in the contract without
 
 3                impairing any of their essential functions and
 
 4                characteristics such as service life, reliability,
 
 5                substitutability, economy of operation, ease of
 
 6                maintenance, and necessary standardized features;
 
 7           and
 
 8      (2)  That accepted cost reduction proposals shall result in
 
 9           an equitable adjustment of the contract price so that
 
10           the contractor will share a portion of the realized
 
11           cost reduction."
 
12      SECTION 3.  Chapter 103D, Hawaii Revised Statutes, is
 
13 amended by adding to part X four new sections to be appropriately
 
14 designated and to read as follows:
 
15      "103D-     Taxpayer preference.  For evaluation purposes,
 
16 the bidder's tax-exempt price shall be increased by the
 
17 applicable retail rate of general excise tax and the applicable
 
18 use tax.  For competitive sealed bids, the lowest responsive,
 
19 responsible bidder, taking into consideration the above increase,
 
20 shall be awarded the contract, but the contract amount of any
 
21 contract awarded shall be the amount of the price offered and
 
22 shall not include the amount of the increase.
 
23      103D-     Preference for qualified community rehabilitation
 

 


 

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 1 programs.  When a governmental body contracts for services, a
 
 2 five per cent preference shall be given to services to be
 
 3 provided by nonprofit corporations or public agencies operating
 
 4 qualified community rehabilitation programs in conformance with
 
 5 criteria established by the department of labor and industrial
 
 6 relations pursuant to chapter 91; provided that contracts awarded
 
 7 under this section shall be exempt from the wages provision of
 
 8 section 103-55.  The policy board shall adopt rules under chapter
 
 9 91 to establish the preference for nonprofit corporations or
 
10 public agencies operating qualified community rehabilitation
 
11 programs consistent with this section.
 
12      103D-     Purchases from qualified community rehabilitation
 
13 programs.  (a)  Any governmental body, without advertising or
 
14 calling for bids, may purchase goods or services provided by
 
15 qualified community rehabilitation programs serving persons with
 
16 disabilities that have indicated an interest in supplying the
 
17 goods or services and on an equitable basis may apportion the
 
18 business among the interested programs; provided that the goods
 
19 and services meet the specifications and needs of the purchasing
 
20 agency and are purchased at a fair market price as determined by
 
21 the appropriate public agency; and provided further that the
 
22 programs comply with the following:
 
23      (1)  Meet all of the requirements of a qualified community
 

 
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 1           rehabilitation program under section 103D-1001; and
 
 2      (2)  Maintain a disabled to non-disabled employee ratio
 
 3           equal to or in excess of three-to-one for work hours of
 
 4           direct labor at all times on the work contracted.
 
 5      (b)  The purchasing agency shall:
 
 6      (1)  Receive and review proposals submitted by qualified
 
 7           community rehabilitation programs to provide goods or
 
 8           services and determine if they are suitable for
 
 9           purchase by the agency;
 
10      (2)  Negotiate the conditions and terms for the purchase,
 
11           including the price of the offer, between the agency
 
12           and the qualified community rehabilitation program;
 
13           provided that the price of the offer shall not exceed
 
14           the fair market price and there is assurance that the
 
15           qualified community rehabilitation program proposal is
 
16           in compliance with all administrative rules related to
 
17           purchasing; and
 
18      (3)  Ensure that any goods or service purchased from a
 
19           qualified community rehabilitation program shall not be
 
20           placed on the Hawaii products list under section
 
21           103D-1002.
 
22      103D-     Qualified community rehabilitation program;
 
23 proposal to provide goods and services.  A qualified community
 

 
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 1 rehabilitation program shall be allowed to sell only goods or
 
 2 services, also to include building custodial and grounds
 
 3 maintenance services, to a governmental body.  A proposal shall
 
 4 be submitted to the purchasing agency containing the following
 
 5 information:
 
 6      (1)  A description of the goods or service;
 
 7      (2)  The price of the goods or service; and
 
 8      (3)  Documents and information necessary to qualify as a
 
 9           qualified community rehabilitation program under
 
10           section 103D-1001."
 
11      SECTION 4.  Section 103D-1001, Hawaii Revised Statutes, is
 
12 amended by adding five new definitions to be appropriately
 
13 inserted and to read as follows:
 
14      ""Direct labor" means all work required for preparation,
 
15 processing, or packing of goods or performance of services, but
 
16 not work relating to supervision, administration, inspection, or
 
17 shipping.
 
18      "Fair market price" means the price of a product or service
 
19 paid by a willing buyer to a willing seller, that is reasonably
 
20 comparable to prices on the open market.
 
21      "Person with disabilities" means any person who is so
 
22 severely incapacitated by any physical or mental disability that
 
23 the person cannot engage in normal competitive employment because
 

 
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 1 of the disability.
 
 2      "Public agency" means any agency of the State or county.
 
 3      "Qualified community rehabilitation program" means a
 
 4 nonprofit community rehabilitation program for persons with
 
 5 disabilities that:
 
 6      (1)  Is organized and incorporated under the laws of the
 
 7           United States or this State, and located in this State;
 
 8      (2)  Is operated in the interest of and employees persons
 
 9           with disabilities;
 
10      (3)  Does not inure any part of its net income to any
 
11           shareholder or other individual;
 
12      (4)  Complies with all applicable occupational health and
 
13           safety standards required by the federal, state, and
 
14           county governments; and
 
15      (5)  Holds a current certificate from the United States
 
16           Department of Labor pursuant to the Fair Labor
 
17           Standards Act, Title 29 United States Code section
 
18           214(c), and is certified by the state department of
 
19           labor and industrial relations under section 387-9 and
 
20           applicable administrative rules relating to the
 
21           employment of persons with disabilities."
 
22      SECTION 5.  Section 76-55, Hawaii Revised Statutes, is
 
23 amended to read as follows:
 

 
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 1      "76-55  Membership of civil service.  All regular employees
 
 2 and all other employees having a permanent appointment in civil
 
 3 service pursuant to law shall constitute the membership of the
 
 4 civil service, but no employee shall be entitled to membership in
 
 5 civil service unless the employee has been appointed in
 
 6 accordance with law and has satisfied all requirements for
 
 7 employment, including those prescribed by [sections 78-1 and
 
 8 103-57.] section 78-1."
 
 9      SECTION 6.  Section 103-11, Hawaii Revised Statutes, is
 
10 amended to read as follows:
 
11      "103-11  Rules of comptroller [regulating expenditures;
 
12 violations, penalty].  [Subject to chapter 91 the] The
 
13 comptroller [may] shall adopt rules[, not inconsistent with law,
 
14 further controlling and regulating the expenditure of state
 
15 moneys.  The rules shall have the force of law.] pursuant to
 
16 chapter 91 as necessary, for the purposes of this chapter.  Any
 
17 violation of the rules shall be subject to the penalties
 
18 prescribed in section 103-9."
 
19      SECTION 7.  Section 103-32.1, Hawaii Revised Statutes, is
 
20 amended to read as follows:
 
21      "103-32.1  Contract provision for retainage.  Any public
 
22 contract [issued under this chapter] may include a provision for
 
23 the retainage of a portion of the amount due under the contract
 

 
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 1 to the contractor to insure the proper performance of the
 
 2 contract; provided that [the]:
 
 3      (1)  The sum withheld by the [contracting] procurement
 
 4           officer from the contractor shall not exceed five per
 
 5           cent of the amount due the contractor and that after
 
 6           fifty per cent of the contract is completed and
 
 7           progress is satisfactory, no additional sum shall be
 
 8           withheld; provided further that if progress is not
 
 9           satisfactory, the contracting officer may continue to
 
10           withhold as retainage, sums not exceeding five per cent
 
11           of the amount due the contractor[.]; and
 
12      (2)  The retainage shall not include sums deducted as
 
13           liquidated damages from moneys due or that may become
 
14           due the contractor under the contract."
 
15      SECTION 8.  Section 103-32.2, Hawaii Revised Statutes, is
 
16 amended to read as follows:
 
17      "[[]103-32.2[]]  Substitution of retainage.  Any other law
 
18 to the contrary notwithstanding, any public contract [issued
 
19 under this chapter] may provide that the [contracting]
 
20 procurement officer may enter into an agreement with the
 
21 contractor which will allow the contractor to withdraw from time
 
22 to time the whole or any portion of the sum retained under
 
23 section 103-32.1 upon depositing with the [contracting]
 

 
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 1 procurement officer any general obligation bond of the State or
 
 2 its political subdivisions with a market value not less than the
 
 3 sum to be withdrawn; provided that the [contracting] procurement
 
 4 officer may require that the total market value of such bond be
 
 5 greater than the sum to be withdrawn."
 
 6      SECTION 9.  Section 103-39.5, Hawaii Revised Statutes, is
 
 7 amended to read as follows:
 
 8      "[[]103-39.5[]]  Construction, renovation, or repair of
 
 9 school facilities; county permit exemption.  Any [contracts under
 
10 this chapter] contract for the construction, renovation, or
 
11 repair of public school facilities shall be exempt from any
 
12 requirement of a county that related off-site improvements be
 
13 made by the contracting government agency as a condition to the
 
14 issuance of any permit."
 
15      SECTION 10.  Section 103-55, Hawaii Revised Statutes, is
 
16 amended to read as follows:
 
17      "103-55  Wages, hours, and working conditions of employees
 
18 of contractors [supplying] performing services.(a)  Before any
 
19 [prospective bidder is entitled to submit any bid for the
 
20 performance of any] offeror enters into a contract to [supply]
 
21 perform services in excess of [$5,000 to] $25,000 for any
 
22 governmental agency, the [bidder] offeror shall certify that the
 
23 services to be performed will be performed under the following
 

 
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 1 conditions:
 
 2      Wages.  The services to be rendered shall be performed by
 
 3 employees paid at wages or salaries not less than the wages paid
 
 4 to public officers and employees for similar work.
 
 5      Compliance with labor laws.  All applicable laws of the
 
 6 federal and state governments relating to workers' compensation,
 
 7 unemployment compensation, payment of wages, and safety will be
 
 8 fully complied with.
 
 9      (b)  No contract to perform services for any governmental
 
10 contracting agency in excess of [$5,000] $25,000 shall be granted
 
11 unless all the conditions of this section are met.  Failure to
 
12 comply with the conditions of this section during the period of
 
13 contract to perform services shall result in cancellation of the
 
14 contract, unless such noncompliance is corrected within a
 
15 reasonable period as determined by the [contracting] procurement
 
16 officer.  [Payment in the final settlement] Final payment of a
 
17 contract or release of bonds or both shall not be made unless the
 
18 [contracting] procurement officer has determined that the
 
19 noncompliance has been corrected.
 
20      It shall be the duty of the governmental contracting agency
 
21 awarding the contract to perform services in excess of [$5,000]
 
22 $25,000 to enforce this section.
 
23      (c)  This section shall apply to all contracts to perform
 

 
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 1 services in excess of [$5,000,] $25,000, including contracts to
 
 2 supply ambulance service and janitorial service.
 
 3      This section shall not apply to:
 
 4      (1)  Managerial, supervisory, or clerical personnel.
 
 5      (2)  Contracts for supplies, materials, or printing.
 
 6      (3)  Contracts for utility services.
 
 7      (4)  Contracts to perform personal services under paragraphs
 
 8           (2), (3), (12), and (15) of section 76-16[.],
 
 9           paragraphs (7), (8), and (9) of section 46-33, and
 
10           paragraphs (7), (8), and (12) of section 76-77.
 
11      (5)  Contracts for professional services.
 
12     [(5)] (6)  Contracts to operate refreshment concessions in
 
13           public parks, or to provide food services to
 
14           educational institutions.
 
15     [(6)] (7)  Contracts with nonprofit institutions."
 
16      SECTION 11.  Section 103-72, Hawaii Revised Statutes, is
 
17 amended to read as follows:
 
18      "[[]103-72[]]  Transcription of instructional materials.
 
19 Contracts for the procurement of instructional materials shall
 
20 include a provision whereby the State has the right to transcribe
 
21 and reproduce the material in braille, large print, recordings,
 
22 or other media for the use of [handicapped] physically-disabled
 
23 students, including the visually [handicapped,] impaired, unable
 

 
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 1 to use the material in conventional print and form.  Such right
 
 2 shall include the right to make those corrections, revisions, and
 
 3 other modifications as may be necessary."
 
 4      SECTION 12.  Section 103D-102, Hawaii Revised Statutes, is
 
 5 amended by amending subsection (b) to read as follows:
 
 6      "(b)  Notwithstanding subsection (a), this chapter shall not
 
 7 apply to contracts by governmental bodies:
 
 8      (1)  Solicited or entered into before July 1, 1994, unless
 
 9           the parties agree to its application to a contract
 
10           solicited or entered into prior to July 1, 1994;
 
11      (2)  To disburse funds, irrespective of their source:
 
12           (A)  For grants[,] or subsidies[, or purchases of
 
13                services] as those terms are defined in section
 
14                [42D-1,] 42F-101, made by the State in accordance
 
15                with standards provided by law as required by
 
16                article VII, section 4, of the State Constitution;
 
17                or by the counties pursuant to their respective
 
18                charters or ordinances;
 
19           (B)  To make payments to or on behalf of public
 
20                officers and employees for salaries, fringe
 
21                benefits, professional fees, or reimbursements;
 
22           (C)  To satisfy obligations that the State is required
 
23                to pay by law, including paying fees, permanent
 

 
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 1                settlements, subsidies, or other claims, making
 
 2                refunds, and returning funds held by the State as
 
 3                trustee, custodian, or bailee;
 
 4           (D)  For entitlement programs, including public
 
 5                assistance, unemployment, and workers'
 
 6                compensation programs, established by state or
 
 7                federal law;
 
 8           (E)  For dues and fees of organizations of which the
 
 9                State or its officers and employees are members,
 
10                including the National Association of Governors,
 
11                the National Association of State and County
 
12                Governments, and the Multi-State Tax Commission;
 
13           (F)  For deposit, investment, or safekeeping, including
 
14                expenses related to their deposit, investment, or
 
15                safekeeping;
 
16           (G)  To governmental bodies of the State; [and]
 
17           (H)  As loans, under loan programs administered by a
 
18                governmental body; and
 
19           (I)  For contracts awarded in accordance with the
 
20                provisions of chapter 103F;
 
21      (3)  To procure goods, services, or construction from a
 
22           governmental body other than the University of Hawaii
 
23           bookstores, from the federal government, or from
 

 
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 1           another state or its political subdivision; [provided
 
 2           that University of Hawaii departments and programs,
 
 3           without regard to this chapter, may procure goods and
 
 4           services from the University of Hawaii bookstores that
 
 5           are routinely stocked and marketed and not specially
 
 6           ordered;
 
 7      (4)  To procure goods or services for the office of
 
 8           intercollegiate athletics of the University of Hawaii
 
 9           at Manoa with moneys from the University of Hawaii at
 
10           Manoa intercollegiate athletics revolving fund;
 
11      (5)] (4)  To procure the following goods or services[,
 
12           including the following:] which are available from
 
13           multiple sources but for which procurement by
 
14           competitive means is either not practicable or not
 
15           advantageous to the State:
 
16           (A)  Services of expert witnesses for potential and
 
17                actual litigation of legal matters involving the
 
18                State, its agencies, and its officers and
 
19                employees, including administrative quasi-judicial
 
20                proceedings;
 
21           (B)  Works of art for museum or public display;
 
22           (C)  Research and reference materials including books,
 
23                maps, periodicals, and pamphlets, which are
 

 
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 1                published in print, video, audio, magnetic, or
 
 2                electronic form;
 
 3           (D)  Meats and foodstuffs for the Kalaupapa settlement;
 
 4           (E)  Opponents for athletic contests;
 
 5           (F)  Utility services whose rates or prices are fixed
 
 6                by regulatory processes or agencies;
 
 7           (G)  Performances, including entertainment, speeches,
 
 8                and cultural and artistic presentations;
 
 9           (H)  Goods and services for commercial resale by the
 
10                State;
 
11           (I)  Services of printers, rating agencies, support
 
12                facilities, fiscal and paying agents, and
 
13                registrars for the issuance and sale of the
 
14                State's or counties' bonds; [and
 
15           (J)  Travel arrangements purchased by the University of
 
16                Hawaii for its intercollegiate athletic programs; 
 
17           which the policy board determines by rule or the chief
 
18           procurement officer determines in writing is available
 
19           from multiple sources but for which procurement by
 
20           competitive means is either not practicable or not
 
21           advantageous to the State; and]
 
22           (J)  Services of attorneys employed or retained to
 
23                advise, represent, or provide any other legal
 

 
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 1                service to the State or any of its agencies, on
 
 2                matters arising under laws of another state or
 
 3                foreign country, or in an action brought in
 
 4                another state, federal, or foreign jurisdiction,
 
 5                when substantially all legal services are expected
 
 6                to be performed outside this State; and
 
 7           (K)  Any other goods or services which the policy board
 
 8                determines by rules or the chief procurement
 
 9                officer determines in writing is available from
 
10                multiple sources but for which procurement by
 
11                competitive means is either not practicable or not
 
12                advantageous to the State; and
 
13     [(6)] (5)  Which are specific procurements expressly exempt
 
14           from any or all of the requirements of this chapter by:
 
15           (A)  References in state or federal law to provisions
 
16                of this chapter or a section of this chapter, or
 
17                references to a particular requirement of this
 
18                chapter; and
 
19           (B)  Trade agreements, including the Uruguay Round
 
20                General Agreement on Tariffs and Trade (GATT)
 
21                which require certain non-construction and non-
 
22                software development procurements by the
 
23                comptroller to be conducted in accordance with its
 

 
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 1                terms."
 
 2      SECTION 13.  Section 103D-201, Hawaii Revised Statutes, is
 
 3 amended by amending subsection (b) to read as follows:
 
 4      "(b)  The policy board shall consist of seven members.
 
 5 Notwithstanding the limitations of section 78-5, the members of
 
 6 the board shall include:
 
 7      (1)  The comptroller;
 
 8      (2)  A county employee with significant high-level
 
 9           procurement experience; and
 
10      (3)  Five persons who shall not otherwise be full-time
 
11           employees of[, or contractors with,] the State or any
 
12           county; provided that at least one member shall be a
 
13           certified professional in the field of procurement, at
 
14           least one member shall have significant high-level,
 
15           federal procurement experience, and at least two
 
16           members shall have significant experience in the field
 
17           of health and human services.
 
18 Each appointed member shall have demonstrated sufficient business
 
19 or professional experience to discharge the functions of the
 
20 policy board.  The initial and subsequent members of the policy
 
21 board, other than the comptroller, shall be appointed by the
 
22 governor from a list of three individuals for each vacant
 
23 position, submitted by a nominating committee composed of four
 

 
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 1 individuals chosen as follows:  two persons appointed by the
 
 2 governor; one person appointed by the president of the senate;
 
 3 and one person appointed by the speaker of the house.  Except as
 
 4 provided in this section, the selection and terms of the policy
 
 5 board members shall be subject to the requirements of section
 
 6 26-34.  No member of the policy board shall act concurrently as a
 
 7 chief procurement officer.  The members of the policy board shall
 
 8 devote such time to their duties as may be necessary for the
 
 9 proper discharge thereof."
 
10      SECTION 14.  Section 103D-203, Hawaii Revised Statutes, is
 
11 amended to read as follows:
 
12      "103D-203  Chief procurement officers.(a)  The chief
 
13 procurement officer for each of the following state entities
 
14 shall be:
 
15      (1)  The judiciary--the administrative director of the
 
16           courts;
 
17      (2)  The senate--the president of the senate;
 
18      (3)  The house of representatives--the speaker of the house
 
19           of representatives;
 
20      (4)  The office of Hawaiian affairs--the chairperson of the
 
21           board;
 
22     [(5)  The University of Hawaii--the president of the
 
23           University of Hawaii;
 

 
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 1      (6)] (5)  The department of education, excluding the Hawaii
 
 2           public library system--the superintendent of education;
 
 3           and
 
 4     [(7)] (6)  The remaining departments of the executive branch
 
 5           of the State and all governmental bodies
 
 6           administratively attached to them--the administrator of
 
 7           the state procurement office of the department of
 
 8           accounting and general services.
 
 9      (b)  The chief procurement officers for each of the several
 
10 counties shall be:
 
11      (1)  The executive branch--the respective finance directors
 
12           of the several counties[; and], except as provided in
 
13           paragraphs (3) and (4);
 
14      (2)  The legislative branch--the respective chairpersons of
 
15           the councils of the several counties;
 
16      (3)  The Honolulu, Kauai, and Maui boards or departments of
 
17           water supply--the managers and chief engineers of the
 
18           respective boards or departments of water supply as
 
19           designated by county charter; and
 
20      (4)  The Hawaii board of water supply--the manager of the
 
21           board of water supply as designated by county charter;
 
22 provided that the chief procurement officers designated under
 
23 paragraphs (1) [and], (2), (3), and (4) shall not exercise their
 

 
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 1 powers or duties over contracting in a manner contrary to the
 
 2 respective county's charter, ordinances, or rules adopted in
 
 3 accordance with chapter 91.
 
 4      (c)  For purposes of applying this chapter to the judiciary,
 
 5 houses of the legislature, office of Hawaiian affairs, department
 
 6 of education, [University of Hawaii,] remaining departments of
 
 7 the executive branch and all governmental bodies administratively
 
 8 attached to them, and the several counties, unless otherwise
 
 9 expressly provided, "State" shall mean "judiciary," "state
 
10 senate," "state house of representatives," "office of Hawaiian
 
11 affairs," "department of education," ["University of Hawaii,"]
 
12 "executive branch," [and] "county," and "board of water supply,"
 
13 or "department of water supply," respectively."
 
14      SECTION 15.  Section 103D-309, Hawaii Revised Statutes, is
 
15 amended by amending subsection (a) to read as follows:
 
16      "(a)  [No contract] Contracts awarded pursuant to section
 
17 103D-302, 103D-303, or 103D-306, shall neither be binding [or of]
 
18 nor have any force and effect of law unless the comptroller, the
 
19 director of finance of a county, or the respective chief
 
20 financial officers of [the University of Hawaii,] the department
 
21 of education, the judiciary, or the legislative branches of the
 
22 State or county, as the case may be, endorses thereon a
 
23 certificate that there is an appropriation or balance of an
 

 
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 1 appropriation over and above all outstanding contracts,
 
 2 sufficient to cover the amount required by the contract; provided
 
 3 that if the contract is a multi-term contract, the comptroller,
 
 4 director of finance, or chief financial officer shall only be
 
 5 required to certify that there is an appropriation or balance of
 
 6 an appropriation over and above all outstanding contracts, that
 
 7 is sufficient to cover the amount required to be paid under the
 
 8 contract during the fiscal year or remaining portion of the
 
 9 fiscal year of each term of the multi-year contract; provided
 
10 further that [this] the administrator of the state procurement
 
11 office shall attest in writing to any recommendation or
 
12 solicitations.  This section shall not apply to any contract
 
13 under which the total amount to be paid to the contractor cannot
 
14 be accurately estimated at the time the contract is to be
 
15 awarded, or to any contract for which consideration is in kind or
 
16 forbearance[.], or to any contract awarded pursuant to section
 
17 103D-306 that is a one-time payment through a purchase order."
 
18      SECTION 16.  Section 103D-321, Hawaii Revised Statutes, is
 
19 amended to read as follows:
 
20      103D-321  Record of procurement actions.(a)  The chief
 
21 procurement officer shall maintain a record of all procurements
 
22 for goods, services, or construction of $25,000 or more made
 
23 under sections [103D-102(b)(5)],] 103D-102(b)(4), 103D-304,
 

 
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                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1 103D-306, and 103D-307 for a minimum of five years.  The record
 
 2 shall contain:
 
 3      (1)  Each contractor's name;
 
 4      (2)  The amount and type of each contract; and
 
 5      (3)  A listing of the goods, services, or construction
 
 6           procured under each contract.
 
 7      (b)  A copy of the record shall be submitted to the
 
 8 legislature on an annual basis.  The record shall be available
 
 9 for public inspection."
 
10      SECTION 17.  Section 103D-703.5, Hawaii Revised Statutes, is
 
11 amended to read as follows:
 
12      "[[]103D-703.5[]]  Settlement [on performance bonds.] of
 
13 default by contractor.  Upon default of a contractor, the
 
14 purchasing agency may accept moneys in satisfaction of the
 
15 contractor's obligation on a contract whether the moneys are
 
16 realized from the performance surety's obligation on its bond[.],
 
17 an insurer's obligation on the contractor's policy, or any other
 
18 source of moneys paid to satisfy a contractor's default.  Such
 
19 moneys shall be deemed to be trust moneys and shall be deposited
 
20 into a trust account with and under the control of the purchasing
 
21 agency.  These moneys and the interest earned thereon shall be
 
22 used for the completion of such contract.  Upon completion of the
 
23 contract, any excess moneys shall be deposited in the general
 

 
Page 25                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1 fund unless otherwise restricted."
 
 2      SECTION 18.  Section 103D-1001.5, Hawaii Revised Statutes,
 
 3 is amended to read as follows:
 
 4      "[[]103D-1001.5[]]  Application of this part.  The
 
 5 preferences in this part shall apply, when applicable, to
 
 6 procurements made pursuant to [sections] section 103D-302 [and],
 
 7 or 103D-303[.], or both."
 
 8      SECTION 19.  Section 103D-1003, Hawaii Revised Statutes, is
 
 9 amended to read as follows:
 
10      "103D-1003  Printing, binding, and stationery work.(a)
 
11 All bids [or proposals] submitted for a printing, binding, or
 
12 stationery section 103D-302 contract in which all work will be
 
13 performed in-state, including all preparatory work, presswork,
 
14 bindery work, and any other production-related work, to include
 
15 storage and shipping costs, shall receive a fifteen per cent
 
16 preference for purposes of bid [or proposal] evaluation.
 
17      (b)  Where bids [or proposals] are for work performed in-
 
18 state and out-of-state, then for the purpose of selecting the
 
19 lowest bid [or evaluating proposals] submitted only, the amount
 
20 bid [or proposed] for work performed out-of-state shall be
 
21 increased by fifteen per cent.  The lowest total [offer,] bid,
 
22 taking the preference into consideration, shall be awarded the
 
23 contract unless the solicitation provides for additional award
 

 
Page 26                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1 criteria.  The contract amount awarded, however, shall be the
 
 2 amount of the price offered, exclusive of the preference."
 
 3      SECTION 20.  Section 103D-1007, Hawaii Revised Statutes, is
 
 4 amended by amending subsections (c) and (d) to read as follows:
 
 5      "(c)  In any section 103D-302 or 103D-303 contract for a
 
 6 public works project, a state agency shall award the contract to
 
 7 [a bidder] an offeror who has filed all state tax returns due to
 
 8 the State and paid all amounts owing on such returns for two
 
 9 successive years prior to submitting the [bid;] offer; provided
 
10 that the amount of that [bid] offer is not more than seven per
 
11 cent higher than the amount [bid] offered by any competing
 
12 contractor who has not filed or paid all applicable state taxes,
 
13 and the amount of the [bid] offer by the state tax paying
 
14 [bidder] offeror is $5,000,000 or less.
 
15      (d)  In any section 103D-302 or 103D-303 contract for a
 
16 public works project, a state agency shall award the contract to
 
17 [a bidder] an offeror who has filed all state tax returns due to
 
18 the State and paid all amounts owing on such returns for four
 
19 successive years prior to submitting the [bid;] offer; provided
 
20 that the amount of that [bid] offer is not more than seven per
 
21 cent higher than the amount [bid] offered by any competing
 
22 contractor who has not filed or paid all applicable state taxes,
 
23 and the amount of the [bid] offer by the state tax paying
 

 
Page 27                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1 [bidder] offeror is more than $5,000,000."
 
 2      SECTION 21.  Section 103D-1206, Hawaii Revised Statutes, is
 
 3 amended to read as follows:
 
 4      "[[]103D-1206[]]  Annual inventory reporting by state
 
 5 officers.  The chief procurement officers for their respective
 
 6 jurisdictions, the administrative heads of the executive
 
 7 departments, and all other persons, offices, and boards of a
 
 8 public character which are not by law under the control and
 
 9 direction of any of the officers specifically named in this
 
10 section, before September 16 of each year, shall prepare and file
 
11 with the administrator of the state procurement office an annual
 
12 inventory return of [all] state property in the possession,
 
13 custody, control, or use of the officer making the return, or of
 
14 the department or office of the government over which the officer
 
15 presides.  Any officer, agent, or employee serving in a
 
16 department or under a returning officer shall file an annual
 
17 inventory return to the department head or the returning officer.
 
18 The officer making the return shall similarly file a copy with
 
19 the administrator of the state procurement office.  The annual
 
20 inventory return shall contain the following:
 
21      (1)  A summary and list by detailed item description and
 
22           carrying value of all nonexpendable state property on
 
23           hand as of July 1 of the year for which the return is
 

 
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                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           made;
 
 2      (2)  A summary and list by detailed item description and
 
 3           carrying value of all nonexpendable state property
 
 4           acquired and disposed of during the year elapsed since
 
 5           the return made as of the preceding July 1; and
 
 6     [(3)  Summary dollar values of expendable property on hand as
 
 7           of July 1 of the year for which the return is made; and
 
 8      (4)] (3)  A sworn statement certifying the information on
 
 9           the return, property listings, and carrying values
 
10           provided with the return to be full, true, and correct
 
11           to the best knowledge, information, and belief of the
 
12           officer making the return."
 
13      SECTION 22.  Section 103D-1207, Hawaii Revised Statutes, is
 
14 amended to read as follows:
 
15      "[[]103D-1207[]]  Annual inventory reporting by county
 
16 mayors to administrator of the state procurement office.  Each
 
17 county mayor, before September 16 of each year, shall prepare and
 
18 file with the administrator of the state procurement office an
 
19 annual inventory return of all nonexpendable state property in
 
20 the use, custody, or possession for the time being of the county
 
21 or any of its officers.  The annual inventory return shall
 
22 contain the following:
 
23      (1)  A summary and list by detailed item description and
 

 
Page 29                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           carrying value of all nonexpendable state property on
 
 2           hand as of July 1 of the year for which the return is
 
 3           made;
 
 4      (2)  A summary and list by detailed item description and
 
 5           carrying value of all nonexpendable state property
 
 6           disposed of during the year elapsed since the return
 
 7           made as of the preceding July 1; and
 
 8      (3)  A sworn statement certifying the information on the
 
 9           return, property listings, and carrying values provided
 
10           with the return to be full, true, and correct to the
 
11           best knowledge, information, and belief of the officer
 
12           making the return."
 
13      SECTION 23.  Section 103D-1208, Hawaii Revised Statutes, is
 
14 amended to read as follows:
 
15      "[[]103D-1208[]]  Annual inventory reporting by county
 
16 officers to council.  Every officer, head of department, agent,
 
17 employee, and other person in the employ of the county, having in
 
18 their custody or under their control or using property belonging
 
19 to the county, each year within forty-five days following the
 
20 close of the county's fiscal year, shall prepare and file with
 
21 the council of the county an annual inventory return of all
 
22 nonexpendable county property in the possession, custody,
 
23 control, or use of the officer, head of department, agent,
 

 
Page 30                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1 employee, or other person making the annual inventory return, or
 
 2 of the offices or departments over which the officer presides.
 
 3 The annual inventory return shall contain the following:
 
 4      (1)  A summary and list by detailed item description and
 
 5           carrying value of all nonexpendable county property on
 
 6           hand as of the close of the county's fiscal year for
 
 7           which the return is made;
 
 8      (2)  A summary and list by detailed item description and
 
 9           carrying value of all nonexpendable county property
 
10           acquired and disposed of during the year elapsed since
 
11           the return made as of the preceding close of the fiscal
 
12           year; and
 
13      (3)  A sworn statement certifying the information on the
 
14           return, property listings, and carrying values provided
 
15           with the return to be full, true, and correct to the
 
16           best knowledge, information, and belief of the officer
 
17           making the return."
 
18      SECTION 24.  Section 128-10, Hawaii Revised Statutes, is
 
19 amended to read as follows:
 
20      "128-10  Other powers.  The governor further, irrespective
 
21 of the existence of a civil defense emergency period, may:
 
22      (1)  Cooperate with the President and the heads of the armed
 
23           forces, and the civil defense agency of the United
 

 
Page 31                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           States, and with the officers and agencies of other
 
 2           states in matters pertaining to the civil defense of
 
 3           the State and nation and the incidents thereof, and
 
 4           take any measures which the governor may consider
 
 5           proper to carry into effect any request of the
 
 6           President or the appropriate federal officers and
 
 7           agencies, for any action looking to civil defense;
 
 8      (2)  Lease, lend, or otherwise furnish, on such terms and
 
 9           conditions as the governor may consider necessary to
 
10           promote the public welfare and protect the interest of
 
11           the State, any real or personal property of the state
 
12           government or its political subdivisions, to the
 
13           President, the heads of the armed forces, or to the
 
14           civil defense agency of the United States;
 
15      (3)  On behalf of the State enter into mutual aid agreements
 
16           or compacts with the federal government and with other
 
17           states.  The agreements or compacts shall be limited to
 
18           civil defense.  It may be provided in an interstate
 
19           compact, and the governor with the advice and consent
 
20           of the political subdivisions included within the scope
 
21           of the compact, may agree on behalf of the State that:
 
22           (A)  Each party state shall extend to the civil defense
 
23                forces of any other party state, while operating
 

 
Page 32                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1                within its state limits under the terms and
 
 2                conditions of the compact, the same powers (except
 
 3                that of arrest unless specifically authorized by
 
 4                the receiving state), duties, rights, privileges,
 
 5                and immunities as if they were performing their
 
 6                duties in the state in which normally employed or
 
 7                rendering services;
 
 8           (B)  Whenever any person holds a license, certificate,
 
 9                or other permit issued by any state evidencing the
 
10                meeting of qualifications for professional,
 
11                mechanical, or other skills, the person may render
 
12                aid involving this skill in any party state to
 
13                meet an emergency or disaster and the state shall
 
14                give due recognition to such license, certificate,
 
15                or other permit as if issued in the state in which
 
16                aid is rendered;
 
17           (C)  No party state or its officers or employees
 
18                rendering aid in another state pursuant to the
 
19                compact shall be liable on account of any act or
 
20                omission on the part of the forces while so
 
21                engaged, or on account of the maintenance or use
 
22                of any materials, equipment, goods, or facilities
 
23                in connection therewith;
 

 
Page 33                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           (D)  As an alternative to paragraph (C), such other or
 
 2                modified form of immunity as the governor may find
 
 3                acceptable;
 
 4           (E)  Each party state shall provide for the payment of
 
 5                compensation and death benefits to injured members
 
 6                of the civil defense forces of that state and the
 
 7                representatives of deceased members of the forces
 
 8                in case the members sustain injuries or are killed
 
 9                while rendering aid pursuant to the compact, in
 
10                the same manner and on the same terms as if the
 
11                injury or death were sustained within the state;
 
12           (F)  Any party state rendering aid in another state
 
13                pursuant to the compact shall be reimbursed by the
 
14                party state receiving aid, or by the United States
 
15                government under plans approved by it, for any
 
16                loss or damage to, or expense incurred in the
 
17                operation of any equipment answering a request for
 
18                aid, and for all costs incurred in connection with
 
19                requests for aid; provided that this paragraph
 
20                shall not be deemed to preclude the State, if it
 
21                is the aiding state, from assuming in whole or in
 
22                part the loss, damage, expense, or other cost, or
 
23                from loaning the equipment or donating the
 

 
Page 34                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1                services to the receiving party state without
 
 2                charge or cost;
 
 3           (G)  Any party state receiving evacuees shall be
 
 4                reimbursed generally for the out-of-pocket
 
 5                expenses incurred in receiving and caring for the
 
 6                evacuees, for expenditures for transportation,
 
 7                food, clothing, medicines, and medical care, and
 
 8                like items; the expenditures shall be reimbursed
 
 9                by the party state of which the evacuees are
 
10                residents, or by the United States government
 
11                under plans approved by it; and
 
12           (H)  In the event of an evacuation, the party state of
 
13                which the evacuees are residents shall, after the
 
14                termination of the emergency or disaster, assume
 
15                the responsibility for the ultimate support or
 
16                repatriation of the evacuees;
 
17      (4)  Sponsor and develop mutual aid plans and agreements for
 
18           civil defense between the political subdivisions of the
 
19           State and between one or more political subdivisions
 
20           and other public or private agencies, for the
 
21           furnishing or exchange of food, clothing, medicine, and
 
22           other materials; engineering services, emergency
 
23           housing; police services; health, medical, and related
 

 
Page 35                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           services; fire fighting, rescue, transportation, and
 
 2           construction services and facilities; personnel
 
 3           necessary to provide or conduct these services; and
 
 4           such other materials, facilities, personnel, and
 
 5           services as may be needed.  The mutual aid plans and
 
 6           agreements may be made with or without provisions for
 
 7           reimbursement of costs and expenses, and on such terms
 
 8           and conditions as are deemed necessary;
 
 9      (5)  Order and direct government agencies, officers, and
 
10           employees, state or local, to take such action and
 
11           employ such measures for law enforcement, medical,
 
12           health, fire fighting, traffic control, warnings, and
 
13           signals, engineering, rescue, construction, emergency
 
14           housing, and other welfare, hospitalization,
 
15           transportation, water supply, public information,
 
16           training, and other civil defense and emergency
 
17           functions as may be necessary, and utilize the
 
18           services, materials, and facilities of the agencies and
 
19           officers.  All such agencies and officers shall
 
20           cooperate with and extend their services, materials,
 
21           and facilities to the governor as the governor may
 
22           request;
 
23      (6)  Take possession of, use, manage, control, and
 

 
Page 36                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           reallocate any public property, state or county, real
 
 2           or personal, required by the governor for the purposes
 
 3           of this chapter, including, without limitation,
 
 4           airports, parks, playgrounds, and schools, and other
 
 5           public buildings.  Whenever the property is so taken
 
 6           the governor shall have power to make such provision
 
 7           for the temporary accommodation of the government
 
 8           service affected thereby as the governor may deem
 
 9           advisable.  Like provisions may be made at any time
 
10           whenever it is necessary to relocate any government
 
11           service because of any emergency condition;
 
12      (7)  Utilize all services, materials, and facilities of
 
13           nongovernmental agencies, relief organizations,
 
14           community associations, and other civil groups and
 
15           private agencies that may be made available;
 
16      (8)  Receive, expend, or use contributions or grants in
 
17           money, property, or services, or loans of property, or
 
18           special contributions or grants in money, property, or
 
19           services, or loans of property, for special purposes
 
20           provided for by this chapter; establish funds in the
 
21           treasury for the deposit and expenditure of the moneys;
 
22           procure federal aid as the same may be available, and
 
23           apply the provisions of chapter 29 in cases of federal
 

 
Page 37                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           aid even though not in the form of money.  The
 
 2           contributions or grants are appropriated for the
 
 3           purposes of this chapter, or for the special purposes;
 
 4      (9)  Provide for the repair and maintenance of public
 
 5           property, whenever adequate provision therefor is not
 
 6           otherwise made; insure the property against any war
 
 7           risk, including without limitation damage or loss
 
 8           resulting from or arising out of an attack or action in
 
 9           resisting or combating an attack or apparent attack;
 
10           provide for the restoration, renovation, replacement,
 
11           or reconstruction of insured property in the event of
 
12           damage or loss, and make temporary restoration of
 
13           public utilities and other vital facilities in the
 
14           event of an attack or other disaster;
 
15     (10)  Purchase, make, produce, construct, rent, lease, or
 
16           procure by condemnation or otherwise, transport, store,
 
17           install, maintain, and insure, repair, renovate,
 
18           restore, replace, or reconstruct, and distribute,
 
19           furnish, or otherwise dispose of, with or without
 
20           charges therefor, materials and facilities for civil
 
21           defense and other emergency functions; procure federal
 
22           aid therefor whenever feasible; and take any measures
 
23           which may, in the governor's opinion, secure,
 

 
Page 38                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           stimulate, or increase similar activities by private or
 
 2           public persons or organizations.  Chapter 103D,
 
 3           sections [103-49,] 103-50, 103-50.5, 103-53 [through
 
 4           103-57], 103-55, 105-1 to 105-10, and 464-4 shall not
 
 5           apply to any civil defense or other emergency functions
 
 6           if and to the extent that the governor finds that the
 
 7           provisions, in whole or in part, impede or tend to
 
 8           impede the expeditious discharge of the functions, or
 
 9           that compliance therewith is impracticable due to
 
10           existing conditions.  In cases of extreme urgency
 
11           during a civil defense emergency period the governor
 
12           may suspend the penal provisions of sections 46-45 and
 
13           103-9, except those provisions that concern
 
14           falsification;
 
15     (11)  Appoint, employ, train, equip, and maintain, with
 
16           compensation, or on a volunteer basis without
 
17           compensation and without regard to chapters 76, 77, and
 
18           79, part II of chapter 88 and section 78-1, such
 
19           agencies, officers, and other persons as the governor
 
20           deems necessary to carry out this chapter; determine to
 
21           what extent any law prohibiting the holding of more
 
22           than one office or employment applies to the agencies,
 
23           officers, and other persons; and subject to section
 

 
Page 39                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           128-15, provide for and effect the interchange of
 
 2           personnel, by detail, transfer, or otherwise, between
 
 3           the State and any political subdivision, or among any
 
 4           agencies or departments of the State;
 
 5     (12)  Make charges in such cases and in such amounts as the
 
 6           governor deems advisable, for any property sold, work
 
 7           performed, services rendered, or accommodations or
 
 8           facilities furnished by the government under this
 
 9           chapter; and make charges for licenses or permits to
 
10           cover administrative expense connected therewith;
 
11     (13)  Make such contracts as may be necessary to carry out
 
12           this chapter;
 
13     (14)  Establish special accounting forms and practices
 
14           whenever necessary; and
 
15     (15)  Take any and all steps necessary or appropriate to
 
16           carry out the purposes of this chapter and to provide
 
17           for civil defense and other emergency functions.
 
18 The powers and authority conferred upon the governor by this
 
19 chapter are in addition to any other powers or authority
 
20 conferred upon the governor by the laws of the United States and
 
21 of the State for the same or a like purpose, and shall not be
 
22 construed as abrogating, limiting, or modifying any such powers,
 
23 or authority."
 

 
Page 40                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1      SECTION 25.  Section 128-13, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "128-13  Power and authority of local organizations.  Each
 
 4 political subdivision shall have the power and authority:
 
 5      (1)  Deputy director's staff.  To provide, for the deputy
 
 6           director of such political subdivision, an assistant or
 
 7           assistants whose appointment shall be approved by the
 
 8           director of civil defense, and such technical,
 
 9           clerical, stenographic, and other personnel, office
 
10           space, furniture, equipment, supplies, and funds as may
 
11           be necessary to carry out the purposes of this chapter.
 
12           Chapter 76 shall apply to the full-time deputy director
 
13           or the deputy director's first assistant.
 
14      (2)  Appropriations, etc.  To make appropriations and
 
15           authorize expenditures for the purposes of this
 
16           chapter, including the power to place under the control
 
17           of the governor, for expenditure as matching funds for
 
18           federal aid, or for any purpose within the powers of
 
19           the governor, moneys appropriated by it; to make
 
20           appropriations and authorize expenditures for the
 
21           purposes of this chapter out of the normal revenues or
 
22           fund balances or surpluses of the political
 
23           subdivision, notwithstanding any legal restrictions
 

 
Page 41                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           upon the purposes for which the funds may be expended,
 
 2           except[,] that pension and retirement funds, funds set
 
 3           aside for the redemption of bonds or the payment of
 
 4           interest thereon, trust funds, loan funds, and funds
 
 5           received from the federal government or from any person
 
 6           for specific purposes shall not be affected.
 
 7      (3)  Procurement, etc.  To purchase, make, produce,
 
 8           construct, rent, lease, or procure by condemnation, or
 
 9           otherwise, transport, store, install, maintain, and
 
10           insure, repair, renovate, restore, replace or
 
11           reconstruct, and distribute, furnish or otherwise
 
12           dispose of, with or without charges, materials and
 
13           facilities for civil defense; and to procure federal
 
14           aid therefor whenever feasible.  Chapter 103D, sections
 
15           [103-41 to 103-57,] 103-50, 103-50.5, 103-53, 103-55,
 
16           105-1 to 105-10, and 464-4 shall not apply to any civil
 
17           defense functions of and to the extent that the mayor
 
18           finds that the provisions, in whole or in part, impede
 
19           or tend to impede the expeditious discharge of the
 
20           functions, or that compliance therewith is
 
21           impracticable due to existing conditions.
 
22      (4)  Personnel.  To provide for the appointment, employment,
 
23           training, equipping, and maintaining, with
 

 
Page 42                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1           compensation, or on a volunteer basis without
 
 2           compensation and without regard to chapters 76, 77, 79,
 
 3           and 88 and section 78-1, of such agencies, officers,
 
 4           and other persons as it deems necessary to carry out
 
 5           this chapter; to determine to what extent any law
 
 6           prohibiting the holding of more than one office or
 
 7           employment applies to the agencies, officers, and other
 
 8           persons; and subject to section 128-15, to provide for
 
 9           the interchange of personnel, by detail, transfer or
 
10           otherwise, between agencies or departments of the
 
11           political subdivision, or between political
 
12           subdivisions.
 
13      (5)  Contributions.  To receive, expend, or use
 
14           contributions or grants in money, property, or
 
15           services, or loans of property, or special
 
16           contributions or grants in money, property, or
 
17           services, or loans of property, for special purposes
 
18           provided for by this chapter.
 
19      (6)  Charges.  To make charges in such cases and in such
 
20           amounts as it deems advisable, for any property sold,
 
21           work performed, services rendered, or accommodations or
 
22           facilities furnished by the political subdivision under
 
23           this chapter.
 

 
Page 43                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1      (7)  Contracts.  To make or authorize such contracts as may
 
 2           be necessary to carry out this chapter.
 
 3      (8)  Mutual aid plans.  To participate in and carry out
 
 4           mutual aid plans and agreements or compacts, sponsored
 
 5           or developed by the state civil defense agency.
 
 6      (9)  Continuity of government.  To insure continuity of
 
 7           government during a civil defense emergency period, the
 
 8           legislative body of a county may by ordinance, unless
 
 9           otherwise provided by law, provide the procedure for
 
10           the appointment and designation of stand-by officers
 
11           for the legislative body and the elected chief
 
12           executive of the county for the emergency period, who
 
13           shall serve in the event of the unavailability of the
 
14           officers for whom they stand by."
 
15      SECTION 26.  Section 382-3, Hawaii Revised Statutes, is
 
16 amended to read as follows:
 
17      "382-3 Government operations.  After the issuance of a
 
18 proclamation pursuant to section 382-2 and during the emergency
 
19 thereby proclaimed, the governor may seize and take possession of
 
20 and operate the entire plant and facilities, including related
 
21 facilities, of any stevedoring company whose operations are
 
22 suspended or substantially reduced, or so much thereof, or such
 
23 interest therein, as the governor may deem necessary in order to
 

 
Page 44                                                    985
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        


 1 carry out the purposes of this chapter.
 
 2      Such government operations may be conducted by the governor
 
 3 through such department or agency of the State as the governor
 
 4 may designate and the governor may delegate to such agency such
 
 5 of the governor's powers as are necessary to conduct the
 
 6 operations.
 
 7      The governor shall have such power and authority as shall be
 
 8 reasonably necessary to conduct such government operations in a
 
 9 manner consistent with the public health, safety, and welfare,
 
10 including, without limitation upon the generality of the
 
11 foregoing, the power to make such contracts and arrangements with
 
12 ship owners, charterers, agents, and operators, wharf and pier
 
13 owners and operators, stevedoring companies, trucking operators,
 
14 warehouse workers and other persons as may be required in order
 
15 to provide stevedoring services and related services.  The
 
16 governor may make contracts without regard to chapter 103D and
 
17 sections [103-41 to 103-57] 103-50, 103-50.5, 103-53, and 103-55
 
18 and, specifically, the certificate of the comptroller as to the
 
19 availability of an unexpended appropriation or balance of an
 
20 appropriation to cover the amount required by any such contract
 
21 shall not be required."
 
22      SECTION 27.  Section 103-15, Hawaii Revised Statutes, is
 
23 repealed.
 

 
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 1      ["103-15  Contract provisions to consider traffic.(a)
 
 2 Unless otherwise prohibited by law, all public contracts awarded
 
 3 under this chapter shall consider the extent to which the work
 
 4 undertaken pursuant to the contract will increase traffic
 
 5 congestion.  The contract shall contain provisions to reasonably
 
 6 minimize any adverse impact.
 
 7      (b)  The feasibility of off-hour construction shall be
 
 8 considered for all public contracts that result in significant
 
 9 traffic congestion or delay during the term of the contract.
 
10      (c)  As used in this section, "off-hour construction" means
 
11 construction performed between the hours of six o'clock p.m. and
 
12 six o'clock a.m."]
 
13      SECTION 28.  Section 103-21, Hawaii Revised Statutes, is
 
14 repealed.
 
15      ["103-21  Officer defined.  The term "procurement officer"
 
16 as used in chapter 103D with respect to contracts entered into by
 
17 a county or a board, bureau, or commission thereof authorized to
 
18 contract in its own behalf, means the council of the county or
 
19 the governing body of such board, bureau, or commission as
 
20 constituted by law, or such officer as is authorized by the
 
21 county council or the board, bureau, or commission to act as its
 
22 contracting officer."]
 
23      SECTION 29.  Section 103-22.1, Hawaii Revised Statutes, is
 

 
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 1 repealed.
 
 2      ["103-22.1  Services of the handicapped.  When a
 
 3 governmental agency contracts for or purchases services, five per
 
 4 cent preference shall be given to services to be performed by
 
 5 nonprofit corporations or public agencies operating sheltered
 
 6 workshops servicing the handicapped in conformance with criteria
 
 7 established by the department of labor and industrial relations
 
 8 pursuant to chapter 91; provided that service contracts awarded
 
 9 under this section shall be exempt from the wages provision of
 
10 section 103-55.  The state comptroller shall adopt rules under
 
11 chapter 91 to establish the preference for the services to be
 
12 performed by nonprofit corporations or public agencies operating
 
13 sheltered workshops consistent with this section."]
 
14      SECTION 30.  Section 103-24.6, Hawaii Revised Statutes, is
 
15 repealed.
 
16      ["103-24.6  Indigenous and Polynesian introduced plants;
 
17 use in public landscaping.(a)  Wherever and whenever feasible,
 
18 all plans, designs, and specifications for new or renovated
 
19 landscaping of any building, complex of buildings, facility,
 
20 complex of facilities, or housing developed by the State with
 
21 public moneys shall incorporate indigenous land plant species, as
 
22 defined in section 195D-2, and plant species brought to Hawaii by
 
23 Polynesians before European contact, such as the kukui, noni, and
 

 
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                                                        S.D. 2
                                                        


 1 coconut; provided that suitable cultivated plants can be made
 
 2 available for this purpose without jeopardizing wild plants in
 
 3 their natural habitat; and provided further that wherever and
 
 4 whenever possible, indigenous land plants shall be used for
 
 5 landscaping on the island or islands on which the species
 
 6 originated.
 
 7      (b)  Each plant or group of plants used pursuant to
 
 8 subsection (a) shall be clearly identified with signs for the
 
 9 edification of the general public.
 
10      (c)  The policy board shall adopt rules pursuant to chapter
 
11 91 to carry out the purposes of this section."]
 
12      SECTION 31.  Section 103-49, Hawaii Revised Statutes, is
 
13 repealed.
 
14      ["103-49  Value engineering clauses; rules.  The State and
 
15 each of the respective counties shall insert clauses providing
 
16 for value engineering incentives in all public works contracts
 
17 for amounts in excess of $100,000.  The clauses shall provide:
 
18      (1)  That cost reduction proposals submitted by contractors:
 
19           (A)  Must require, in order to be applied to the
 
20                contract, a change order thereto; and
 
21           (B)  Must result in savings to the State or county, as
 
22                the case may be, by providing less costly items
 
23                than those specified in the contract without
 

 
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 1                impairing any of their essential functions and
 
 2                characteristics such as service life, reliability,
 
 3                economy of operation, ease of maintenance, and
 
 4                necessary standardized features.
 
 5      (2)  That accepted cost reduction proposals shall result in
 
 6           an equitable adjustment of the contract price so that
 
 7           the contractor will share a portion of the realized
 
 8           cost reduction.
 
 9      The policy office shall adopt, pursuant to chapter 91, such
 
10 rules as may be necessary and proper to implement this section,
 
11 provide adequate incentives to contractors, realize savings for
 
12 the State or counties, and to otherwise carry out the purposes of
 
13 this section."]
 
14      SECTION 32.  Section 103-53.5, Hawaii Revised Statutes, is
 
15 repealed.
 
16      ["103-53.5  Tax adjustment for out-of-state vendors and
 
17 tax-exempt bidders.  Where the bidder or vendor is an out-of-
 
18 state vendor not doing business in the State or is a person
 
19 exempted from paying the applicable general excise tax, the
 
20 package bid or purchase price, for the purpose of determining the
 
21 lowest price bid, shall be increased by the applicable retail
 
22 rate of general excise tax and the applicable use tax.  The
 
23 lowest responsible bidder, taking into consideration the above
 

 
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                                                        S.D. 2
                                                        


 1 increases, shall be awarded the contract, but the contract amount
 
 2 of any contract awarded shall be the amount of the bid offered
 
 3 and shall not include the amount of the increases."]
 
 4      SECTION 33.  Section 103-54, Hawaii Revised Statutes, is
 
 5 repealed.
 
 6      ["103-54  Wages of certain laborers paid weekly; penalty.
 
 7 All contracts executed pursuant to this chapter involving the
 
 8 employment of laborers shall provide for weekly payment of wages
 
 9 to all laborers whose rate of compensation is $5 or less per day.
 
10 Every laborer employed by the contractor or any subcontractor
 
11 under any such contract whose rate of compensation is $5 or less
 
12 per day shall be paid the laborer's wages weekly by the laborer's
 
13 employer, whether or not the requirement is set forth in the
 
14 contract.  Every contractor or subcontractor who violates this
 
15 section shall be fined not more than $500."]
 
16      SECTION 34.  Section 103-56, Hawaii Revised Statutes, is
 
17 repealed.
 
18      ["103-56  Pay days.  Except as provided in section 103-54
 
19 the fifteenth and last days in each month shall be the pay days
 
20 of all employees engaged in constructing or repairing roads,
 
21 bridges, or streets for the State."]
 
22      SECTION 35.  Section 103-57, Hawaii Revised Statutes, is
 
23 repealed.
 

 
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 1      ["103-57  Only citizens employed, exception.  No person
 
 2 shall be employed as a mechanic or laborer upon any public work
 
 3 carried on by the State or by any political subdivision thereof,
 
 4 whether the work is done by contract or otherwise, unless the
 
 5 person is a citizen of the United States and of the State or
 
 6 eligible to become such a citizen; provided that in cases where
 
 7 it is not reasonably practicable to obtain competent persons with
 
 8 the foregoing qualifications, persons without such qualifications
 
 9 may, with the approval of the governor where the compensation for
 
10 such employment is paid out of state funds, or with the approval
 
11 of the mayor where the compensation for such employment is paid
 
12 out of county funds or out of funds under the control of any
 
13 county board, bureau, or commission, be employed until persons
 
14 with such qualifications competent for such services can be
 
15 obtained."]
 
16      SECTION 36.  Section 103-58, Hawaii Revised Statutes, is
 
17 repealed.
 
18      ["103-58  Officers, etc., forbidden interest in government
 
19 contracts.  No officer or head of any department of the State or
 
20 of any political or municipal subdivision thereof having the
 
21 power to make or award a contract on the part of the government
 
22 shall, on behalf of the State or of such subdivision thereof
 
23 under which he may be elected or appointed, as the case may be,
 

 
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 1 make, or award, or participate in the awarding of a contract to
 
 2 himself or to any partnership or corporation in which he is a
 
 3 member or stockholder when the contract involves the expenditure
 
 4 of government funds in excess of $50.
 
 5      Nor shall any officer or head of any department of the State
 
 6 or any subdivision thereof before or after award of contracts,
 
 7 gain an interest as subcontractor or otherwise for which he shall
 
 8 receive a consideration of over $50 in any contract which he has
 
 9 made or awarded or participated in the making or awarding of, on
 
10 behalf of the State or on behalf of any subdivision thereof under
 
11 which he may be elected or appointed, as the case may be.  This
 
12 section shall not apply (1) if the contract is made with a
 
13 corporation in which the officer of the State or any subdivision
 
14 thereof has the ownership of not more than five per cent of the
 
15 capital stock if it be a corporation or joint stock company; (2)
 
16 if any contract made by the State or any subdivision thereof is
 
17 awarded to the lowest responsible bidder after advertisement for
 
18 sealed tenders according to law in cases where the sum to be
 
19 expended is $1,000 or more; or (3) if any contract is awarded to
 
20 the lowest responsible bidder when requests of the same character
 
21 have been made to the principal dealers, contractors, persons,
 
22 partnerships, or corporations doing such work or selling such
 
23 commodities for sealed tenders for the same in cases where the
 

 
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 1 sum to be expended is more than $50 and less than $100."]
 
 2      SECTION 37.  Section 103-59, Hawaii Revised Statutes, is
 
 3 repealed.
 
 4      ["103-59  Violation voids contract.  A violation of section
 
 5 103-58 shall render the contract or agreement in respect of which
 
 6 such violation occurs void."]
 
 7      SECTION 38.  Section 103-60, Hawaii Revised Statutes, is
 
 8 repealed.
 
 9      ["103-60  Penalty.  Any person who violates section 103-58
 
10 shall be fined not more than $1,000 or imprisoned not more than
 
11 one year, or both."]
 
12      SECTION 39.  Section 103-71, Hawaii Revised Statutes, is
 
13 repealed.
 
14      ["[103-71]  Energy efficiency through life-cycle costing.
 
15 (a)  The procurement practices of the State and its counties
 
16 shall include energy efficiency standards and policies, including
 
17 life-cycle costing.  These shall be developed and introduced into
 
18 procurement procedures by July 1, 1978.
 
19      (b)  In implementing life-cycle costing, the purchasing
 
20 agent shall be guided by energy efficiency standards and policies
 
21 for purchasing various items developed and promulgated by the
 
22 United States Department of Energy and other federal agencies,
 
23 and by nationally recognized trade associations, including but
 

 
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 1 not limited to the Institute of Government Purchasing Agents, the
 
 2 Purchasing Management Association, and the Air Conditioning and
 
 3 Refrigeration Institute.  The purchasing agent shall notify
 
 4 bidders of information, procedures and forms required in
 
 5 implementing energy efficiency standards and policies.  The
 
 6 information required shall include purchasing standards and
 
 7 policies developed by federal agencies and by nationally
 
 8 recognized agencies and associations, as well as energy
 
 9 consumption and life-cycle cost data.
 
10      (c)  The purchaser shall consider purchasing via the life-
 
11 cycle costing method those classes of items for which nationally
 
12 recognized energy efficiency data have been developed.  These
 
13 items shall include but not be limited to automobiles and air
 
14 conditioning systems.  The watt-saving variety of common-sized
 
15 fluorescent lamps shall be purchased except where standard
 
16 wattage of such lamps is specifically required by the using
 
17 agency."]
 
18      SECTION 40.  Parts III and V of chapter 103, Hawaii Revised
 
19 Statutes, are repealed.
 
20      SECTION 41.  Statutory material to be repealed is bracketed.
 
21 New statutory material is underscored.
 
22      SECTION 42.  This Act shall take effect on July 1, 1999.