North Carolina § 143-135 - 9. Best Value procurements.

§ 143-135. 9. Best Value procurements.

Definitions. - The following definitions apply in this section: Best Value procurement. - The selection of a contractor based on a determination of which proposal offers the best trade-off between price and performance, where quality is considered an integral performance factor. The award decision is made based on multiple factors, including: total cost of ownership, meaning the cost of acquiring, operating, maintaining, and supporting a product or service over its projected lifetime; the evaluated technical merit of the vendor's proposal; the vendor's past performance; and the evaluated probability of performing the requirements stated in the solicitation on time, with high quality, and in a manner that accomplishes the stated business objectives and maintains industry standards compliance. Government-Vendor partnership. - A mutually beneficial contractual relationship between State government and a contractor, wherein the two share risk and reward, and value is added to the procurement of needed goods or services. Repealed by Session Laws 2013-188, s. 1, effective June 26, 2013. Solution-Based solicitation. - A solicitation in which the requirements are stated in terms of how the product or service being purchased should accomplish the business objectives, rather than in terms of the technical design of the product or service. Intent. - The intent of Best Value procurement is to enable contractors to offer and the agency to select the most appropriate solution to meet the business objectives defined in the solicitation and to keep all parties focused on the desired outcome of a procurement. Information Technology. - The acquisition of information technology by the State of North Carolina shall be conducted using the Best Value procurement method. For purposes of this section, business process reengineering, system design, and technology implementation may be combined into a single solicitation. For acquisitions which the procuring agency and the Division of Purchase and Contracts or the Department of Information Technology, as applicable, deem to be highly complex or determine that the optimal solution to the business problem at hand is not known, the use of Solution-Based Solicitation and Government-Vendor Partnership is authorized and encouraged. Any county, city, town, or subdivision of the State may acquire information technology pursuant to this section. Repealed by Session Laws 2009-320, s. 1, effective July 24, 2009. North Carolina Zoological Park. - The acquisition of goods and services under a contract entered pursuant to the exemption of G.S. 143-129.8A(a) by the Department of Natural and Cultural Resources on behalf of the North Carolina Zoological Park may be conducted using the Best Value procurement method. For acquisitions which the procuring agency deems to be highly complex, the use of Government-Vendor partnership is authorized. History (1998-189, s. 1; 1999-434, s. 15; 1999-456, s. 39; 2009-329, s. 1.2; 2013-188, s. 1; 2015-241, ss. 7A.4(u), 14.30(zz).) Editor's Note. - The definitions in subsection (a) were placed in alphabetical order at the direction of the Revisor of Statutes. Session Laws 2013-360, s. 7.7(a)-(c), provides: "(a) SCIO Review. - The State Chief Information Officer (State CIO) shall review all State information technology (IT) contracts and shall develop a plan to consolidate duplicate IT contracts and multiple IT contracts with the same vendor. "(b) Bulk Purchasing. - The State CIO shall develop a plan to modify bulk purchasing contracts, while maintaining economies of scale, to provide agencies with the option of purchasing equipment on an 'as-needed' basis. By December 15, 2013, the State CIO shall provide the plan to the Joint Legislative Oversight Committee on Information Technology and the Fiscal Research Division. The State CIO may modify the plan based upon input from the Joint Legislative Oversight Committee on Information Technology and, following the review, shall begin implementation of the plan. "(c) Sole Sourcing, Extensions, and Expansions Limited. - State IT contracts, including sole sourcing, extensions of the period of performance, or expansion of the scope of existing contracts, must receive the prior approval of the State CIO who may grant a specific exception. The State CIO shall immediately report any exceptions granted to the Joint Legislative Oversight Committee on Information Technology and the Fiscal Research Division. The report shall explain the reasons why the exception was deemed to be appropriate." Session Laws 2013-360, s. 7.7(e), (f), provides: "(e) Enterprise Contracts. - The State CIO shall consult participating agency chief information officers and obtain approval from the Office of State Budget and Management prior to the initiation of any enterprise project or contract and shall ensure that enterprise project and contract costs are allocated to participating agencies in an equitable manner. Enterprise agreements shall not exceed the participating State agencies' ability to financially support the contracts. "The State CIO shall not enter into any enterprise information technology contracts without obtaining written agreements from participating State agencies regarding the apportionment of the contract cost. State agencies agreeing to participate in a contract shall: "(1) Ensure that sufficient funds are budgeted to support their agreed shares of enterprise contracts throughout the life of the contract. "(2) Transfer the required funding to the Information Technology Internal Service Fund in sufficient time for the Office of Information Technology Services to meet vendor contract requirements. "(f) Three-Year Contracts. - Notwithstanding the cash management provisions of G.S. 147-86.11 , the Office of Information Technology Services may procure information technology goods and services for periods up to a total of three years where the terms of the procurement contracts require payment of all or a portion of the contract price at the beginning of the contract agreement. All of the following conditions shall be met before payment for these agreements may be disbursed: "(1) Any advance payment can be accomplished within the IT Internal Service Fund budget. "(2) The State Controller receives conclusive evidence that the proposed agreement would be more cost-effective than a multiyear agreement that complies with G.S. 147-86.11 . "(3) The procurement complies in all other aspects with applicable statutes and rules. "(4) The proposed agreement contains contract terms that protect the financial interest of the State against contractor nonperformance or insolvency through the creation of escrow accounts for funds, source codes, or both, or by any other reasonable means that have legally binding effect. "The Office of State Budget and Management shall ensure the savings from any authorized agreement shall be included in the IT Internal Service Fund rate calculations before approving annual proposed rates. Any savings resulting from the agreements shall be returned to agencies included in the contract in the form of reduced rates. Beginning October 1, 2013, ITS shall submit a quarterly written report of any authorizations granted under this section to the Joint Legislative Oversight Committee on Information Technology and the Fiscal Research Division." Session Laws 2013-360, s. 7.7(g), as added by Session Laws 2014-100, s. 7.7, provides: "(g) Enhance State IT Contract Expertise. - The State Chief Information Officer (State CIO), the Office of State Human Resources, the Department of Computer Science at North Carolina State University, the Schools of Government and Law at the University of North Carolina at Chapel Hill, and in the discretion of the State CIO, schools and departments at other public and private institutions of higher learning in the State, shall work jointly to create a career path for State government information technology contracting professionals that includes defined qualifications, career progression, training opportunities, and appropriate compensation. By December 1, 2014, the State CIO shall submit a detailed, fully implementable plan to create the career path for State government information technology contracting professionals to the Joint Legislative Oversight Committee on Information Technology and the Fiscal Research Division." Session Laws 2013-360, s. 7.8, as amended by Session Laws 2013-363, s. 2.3, provides: "Notwithstanding any provision of law to the contrary, no contract for information technology personal services, or that provides personnel to perform information technology functions, may be established or renewed without written approval from the Statewide Information Technology Procurement Office and the Office of State Budget and Management. To facilitate compliance with this requirement, the Statewide Information Technology Procurement Office shall develop and document the following: "(1) Standards for determining whether it is more appropriate for an agency to hire an employee or use the services of a vendor. "(2) A process to monitor all State agency personal services contracts, as well as any other State contracts providing personnel to perform information technology functions. "(3) A process for obtaining approval of contractor positions. "The Statewide Information Technology Procurement Office shall review current personal services contracts and determine if each contractor is performing a function that could more appropriately be performed by a State employee. Where the determination is made that a State employee should be performing the function, the Statewide Information Technology Procurement Office shall work with the impacted agency, the Office of State Budget and Management, and the Office of State Personnel to identify or create the position. "Beginning October 1, 2013, the Statewide Information Technology Procurement Office shall report to the Joint Legislative Oversight Committee on Information Technology and the Fiscal Research Division on its progress toward standardizing information technology personal services contracts. In addition, the report shall include detailed information on the number of personal service contractors in each State agency, the cost for each, and the comparable cost (including benefits) of a State employee serving in that capacity rather than a contractor." Session Laws 2013-360, s. 1.1, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2013.'" Session Laws 2013-360, s. 38.2, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2013-2015 fiscal biennium, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2013-2015 fiscal biennium." Session Laws 2013-360, s. 38.5, is a severability clause. Session Laws 2014-100, s. 1.1, provides: "This act shall be known as 'The Current Operations and Capital Improvements Appropriations Act of 2014.'" Session Laws 2014-100, s. 38.4, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2014-2015 fiscal year, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2014-2015 fiscal year." Session Laws 2014-100, s. 38.7, is a severability clause. Effect of Amendments. - Session Laws 2009-329, s. 1.2, effective July 24, 2009, rewrote the section catchline; in subsection (a), rewrote the introductory paragraph; in subdivision (a)(2), substituted "needed goods or services" for "complex technology" at the end; in subsection (b), added the subsection catchline, and deleted the former last sentence, which read: "Business process reengineering, system design, and technology implementation may be combined into a single solicitation."; in subsection (c), added the subsection catchline, and added the second and last sentences; deleted subsection (d), which read: "Any county, city, town or subdivision of the State may acquire information technology pursuant to this section."; and added subsection (e). Session Laws 2013-188, s. 1, effective June 26, 2013, repealed subdivision (a)(3). Session Laws 2015-241, s. 7A.4(u), effective September 18, 2015, substituted "Department of Information Technology" for "Office of Information Technology Services" near the middle of subsection (c). Session Laws 2015-241, s. 14.30(zz), effective July 1, 2015, substituted "Department of Natural and Cultural Resources" for "Department of Environment and Natural Resources" in subsection (e).