THE SENATE

S.B. NO.

1059

TWENTY-NINTH LEGISLATURE, 2017

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to small business.

 

 

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

 


     SECTION 1.  The legislature finds that small businesses are the lifeblood of the State's economy.  Act 50, Session Laws of Hawaii 2005, was enacted to promote the growth and development of small businesses.  During the regular session of 2007, the legislature approved funding for one full-time equivalent position in the state procurement office in order to implement part IX of the state procurement code, assistance to small businesses.  Unfortunately, due to funding and staffing cuts in 2008, the position was never filled and eventually lapsed.  Section 3-124-73, Hawaii Administrative Rules, went into effect in 2007 without a dedicated position or small business office, and these rules eventually expired in 2011.

     The legislature finds that businesses owned by veterans, Native Hawaiians, and women are the most vulnerable and disadvantaged businesses in the State.  The legislature further finds that an initiative is needed to identify, quantify, and address the needs of these small businesses and to measure and track their present participation in state small business contracts.  The legislature recognizes that the State must create, develop, and implement strategies to ensure that small businesses are able to effectively participate in small business contracting opportunities within the State.

     The legislature additionally finds that previously-adopted administrative rules with respect to the development of small business contracts were not effective because of a lack of appropriate business metrics and available data.  The legislature recognizes that addressing small business concerns in the State must be done incrementally.  The legislature also finds that the state procurement office is now ready to address the small business part of the state procurement code and assist self-identified small businesses in obtaining state contracts.

     The purpose of this Act is to assist small businesses in obtaining state contracts through the state procurement office by:

     (1)  Creating a small business assistance initiative to convene small business stakeholders, collect and develop relevant data and information necessary for small businesses to compete for small business contracts, and develop an effective small business contracting program within the State; and

     (2)  Appropriating funds for staffing of the small business assistance initiative.

     SECTION 2.  Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to part IX to be appropriately designated and to read as follows:

     "§103D-    Small business assistance initiative; established.  (a)  A small business assistance initiative shall be established within the state procurement office.  The initiative shall enable the collection and development of small business data and information, and convene stakeholders to develop an effective small business program with actionable rules.

     The small business assistance initiative shall consist of a small business assistance coordinator, small business office, and small business advisory group.  The small business assistance coordinator and small business office shall collect and provide data and metrics to the small business advisory group which, in turn, shall make recommendations that may be used to adopt permanent rules to carry the initiative forward.

     (b)  There is established within the state procurement office one full-time equivalent position for a small business assistance coordinator.  This position shall be exempt from chapter 76.  This position shall be part of the small business assistance initiative and shall be directly responsible for the maintenance and collection of data from the state small business database and the daily operations of the small business assistance initiative.  The small business assistance coordinator shall be responsible for the following:

     (1)  Establishing and maintaining a statewide small business database;

     (2)  Establishing and managing small business registration, certification, and identification processes;

     (3)  Drafting policies and rules to assist in the implementation of this part;

     (4)  Producing, publishing, and disseminating trainings designed to inform procurement staff and self-identified small business vendors of small business programs and opportunities;

     (5)  Conducting surveys and collecting feedback from procurement staff and self-identified small business vendors and presenting the information to the small business advisory group and the state procurement office; and

     (6)  Producing an annual report consisting of small business participation metrics and data, and submitting the report to the small business advisory group.

     (c)  There shall be established a small business office as part of the small business assistance initiative.  The state procurement office shall enter into a contract with a private entity to perform the work of the small business office.  The contract shall be awarded to an existing, Hawaii-based small business advocacy group with experience helping small businesses obtain state and federal contracts.  The contract awardee shall be a Native Hawaiian-, veteran-, or women-owned small business and shall have the capacity and understanding of the small business community to be able to meet the requirements of the small business assistance initiative.

     The small business office shall be responsible for:

     (1)  Providing timely trainings and reports relating to key developments in the small business community;

     (2)  Establishing communications with self-identified vendors, which may include the development and implementation of a newsletter and email campaign to keep vendors informed of current small business events;

     (3)  Producing and publicizing outreach campaigns related to the initiative and other small business programs and opportunities;

     (4)  Creating, developing, advertising, and encouraging vendor participation in workshops, seminars, and trainings designed to promote and enhance small business participation in state contracts;

     (5)  Establishing mechanisms and implementing procedures for conducting audits, handling disputes, and investigating allegations of fraud and other misappropriations of the initiative;

     (6)  Aggregating all small business resources and materials from around the State and presenting them in an accessible and understandable online format;

     (7)  Coordinating with small business advocates in the public and private sectors to create a small business network that can be easily accessed by all small businesses;

     (8)  Answering correspondence from small business vendors about the State's existing small business programs; and

     (9)  Collecting data on existing and future small business vendor disputes, problems, difficulties, successes, recommendations, and any other metrics deemed important to the initiative by the state procurement office or legislature.

     (d)  There shall be established a small business advisory group as part of the small business assistance initiative.  The members of the small business advisory group shall be selected by the administrator and shall consist of small business advocates from state agencies, non-profit entities, and local businesses.  The small business advisory group shall be staffed by the administrator.

     The small business advisory group shall:

     (1)  Hold meetings, pursuant to chapter 92, to review the progress of the small business assistance initiative and investigate issues brought to the attention of the group;

     (2)  Recommend amendments and substantive improvements necessary to achieve the intention of the initiative;

     (3)  Recommend the scope, powers, administrative definition, staffing, and funding requirements necessary for the creation of a state small business office designed to help small businesses better utilize a future small business program;

     (4)  Report to the legislature no later than November 30, 2020, regarding the recommended goals for an annual amount of state expenditures to be awarded to identified veteran-, Native Hawaiian-, or women-owned small businesses based on the metrics established by the initiative;

     (5)  Recommend plans for the small business assistance coordinator position, including job responsibilities and placement of the position outside of the initiative;

     (6)  Complete a study prior to the expiration of this initiative to determine the viability of transferring the functions of the small business office to an office within an existing state department and submit the study and any recommendations to the policy board and the legislature prior to the expiration of the initiative;

     (7)  Determine the appropriateness of retaining the small business assistance coordinator as an exempt employee or converting the position to a civil service position, and submit a recommendation to the policy board and the legislature prior to the expiration of the initiative regarding the future status of the position;

     (8)  Draft, publish, and disseminate prior to the expiration of the initiative, a final report of recommendations, observations, and metrics related to the small business assistance initiative and its success in encouraging and growing the participation of small businesses in applying for and being awarded state contracts; and

     (9)  Provide recommendations in the final report regarding next steps toward development of a state small business program consistent with section 103D-906, and propose rules for the small business program to be adopted and implemented by the policy board.

     (e)  The small business assistance initiative shall end on June 30, 2020."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2017-2018 and the same sum or so much thereof as may be necessary for fiscal year 2018-2019 for the completion of the state small business database.

     The sums appropriated shall be expended by the state procurement office for the purposes of this Act.

     SECTION 4.  There is appropriated out of the general revenues of the State of Hawaii the sum of $330,000 or so much thereof as may be necessary for fiscal year 2017-2018 and the same sum or so much thereof as may be necessary for fiscal year 2018-2019 to establish one full-time equivalent (1.0 FTE) exempt position for a small business assistance coordinator within the state procurement office.

     The sums appropriated shall be expended by the state procurement office for the purposes of this Act.

     SECTION 5.  There is appropriated out of the general revenues of the State of Hawaii the sum of $375,000 or so much thereof as may be necessary for fiscal year 2017-2018 and the same sum or so much thereof as may be necessary for fiscal year 2018-2019 for the state procurement office to contract with a local small business, which shall serve as the small business office during the small business assistance initiative and for the marketing and outreach of the small business assistance initiative.

     The sums appropriated shall be expended by the state procurement office for the purposes of this Act.

     SECTION 6.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on July 1, 2017; provided that on June 30, 2020, section 2 of this Act shall be repealed.

 

INTRODUCED BY:

_____________________________

 

 

 

 

 

 


 


 

Report Title:

Small Business Assistance Initiative; Procurement Initiative; Appropriation

 

Description:

Establishes and defines a three-year small business assistance initiative and its parts within the state procurement office to develop an effective small business state contracting program.  Establishes a small business assistance coordinator position, small business office, and small business advisory group as part of the initiative.  Appropriates funds for the administration and operation of the initiative.  Repeals the initiative on June 30, 2020.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.