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HF 2272

as introduced - 88th Legislature (2013 - 2014) Posted on 03/21/2014 02:39pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to education; requiring best value analysis and minimum standards for
school service contracts; proposing coding for new law in Minnesota Statutes,
chapter 123B.

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

Section 1.

new text begin [123B.521] BEST VALUE FOR SERVICE CONTRACTS.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the terms defined in
this subdivision have the meanings given them.
new text end

new text begin (b) "Employees" means school district employees and includes only public
employees within the meaning of section 179A.03, subdivision 14.
new text end

new text begin (c) "School district services" means paraprofessional, transportation, nutrition,
custodial, and clerical services performed by employees, with the exception of services
exempted in subdivision 4.
new text end

new text begin (d) "Service contract" means an enforceable agreement or set of agreements by
which a contractor agrees with a school district to provide school district services in
place of services previously provided by employees or in place of services that could be
provided by employees.
new text end

new text begin Subd. 2. new text end

new text begin Initial best value determination. new text end

new text begin (a) For purposes of initial service
contracts, "best value" describes the result determined by a procurement method that
considers short-term and long-term costs, including:
new text end

new text begin (1) the cost of the bid price, including the contract clauses required under paragraph
(b);
new text end

new text begin (2) transition costs, including the cost associated with separating employees;
new text end

new text begin (3) anticipated costs associated with changes in staff turnover;
new text end

new text begin (4) salary and benefit cost of employees equal to the anticipated proportion of
their time spent performing initial training of service contract workers, service contract
compliance monitoring, and other likely administrative costs over the life of the service
contract; and
new text end

new text begin (5) anticipated service contract enforcement costs.
new text end

new text begin (b) To attract and retain high-quality candidates under a service contract, each
service contract must contain:
new text end

new text begin (1) a clause requiring minimum wage rates equivalent to or greater than the wage
rates paid to the employees who would otherwise perform the work;
new text end

new text begin (2) a clause requiring (i) health benefits equivalent to or greater than the health
benefits of the employees who would otherwise perform the work or (ii) monetary payment
to workers equivalent to or greater than the cost of the health benefits under item (i); and
new text end

new text begin (3) a clause requiring (i) retirement and other benefits equivalent to or greater than
those of the employees who would otherwise perform the work or (ii) monetary payment
to workers equivalent to or greater than the cost of the benefits under item (i).
new text end

new text begin (c) A school district may enter into a school services contract only if the calculation
under paragraph (a) creates an anticipated savings of five percent or larger over the term of
the service contract compared to the wage and benefit costs of the employees currently
performing the duties in the bid request over the service contract period. The term of the
school services contract under this subdivision may not exceed two years.
new text end

new text begin (d) Before executing a service contract under this subdivision, the following must be
reviewed at a school board meeting:
new text end

new text begin (1) the estimated costs under paragraph (a); and
new text end

new text begin (2) for contractors with similar service contracts in other Minnesota school districts:
new text end

new text begin (i) the increase in initial service contract price and subsequent service contract
periods;
new text end

new text begin (ii) workers' compensation claims by the contractor; and
new text end

new text begin (iii) other safety and legal violations by the contractor.
new text end

new text begin Subd. 3. new text end

new text begin Renewal best value determination. new text end

new text begin (a) For purposes of a renewal of a
service contract under subdivision 2, "best value" describes the result determined by a
procurement method that considers:
new text end

new text begin (1) short-term and long-term costs, including:
new text end

new text begin (i) the cost of the bid price, including the contract clauses required under subdivision
2, paragraph (b);
new text end

new text begin (ii) salary and benefit cost of employees equal to the anticipated proportion of their
time spent training contract workers, performing contract compliance monitoring, and
other likely administrative costs over the life of the service contract;
new text end

new text begin (iii) costs associated with changes in the incidence of safety and other legal
violations, including regulatory compliance; and
new text end

new text begin (iv) service contract enforcement costs; and
new text end

new text begin (2) quality of services, including:
new text end

new text begin (i) measures of employee performance;
new text end

new text begin (ii) ability to assess and minimize risk, as measured by appropriate workers'
compensation claims, safety violations, and legal complaints or violations, including
regulatory compliance; and
new text end

new text begin (iii) parental complaints directly involving workers.
new text end

new text begin (b) A school district may renew a service contract only if:
new text end

new text begin (1) the actual cost of the expiring service contract, as calculated under subdivision 2,
paragraph (a), did not exceed 102 percent of the estimated cost of the service contract as
reported under subdivision 2, paragraph (d), clause (1);
new text end

new text begin (2) the calculation under paragraph (a), clause (1), is less over the term of the service
contract compared to the wage and benefit costs during the last term of equal length in
which employees performed the duties in the bid request; and
new text end

new text begin (3) there was not a higher rate of negative incidents of any quality of service measure
under paragraph (a), clause (2), when compared to the most recent equivalent period
when the work was done by employees.
new text end

new text begin (c) Before renewing a service contract under this subdivision, the estimated costs
under paragraph (a), clause (1), must be reviewed at a school board meeting.
new text end

new text begin (d) If (1) a school district may not renew the service contract under paragraph (b),
and (2) the cost of transferring the duties to employees does not exceed 110 percent of
the expiring service contracts, the school district must transfer the duties in the service
contract to employees for a period of at least four years before approving another service
contract under subdivision 2. If the cost of transferring duties to employees exceeds 110
percent, the contract may be rebid under the terms of subdivision 1.
new text end

new text begin Subd. 4. new text end

new text begin Exemptions. new text end

new text begin This section does not apply to:
new text end

new text begin (1) temporary contracts and nonrecurring contracts that do not result in displacement
of employees;
new text end

new text begin (2) contracts for services previously performed by supervisory employees,
professional employees, or confidential employees as defined in section 179A.03; and
new text end

new text begin (3) contracts in an amount of less than $25,000.
new text end

new text begin Subd. 5. new text end

new text begin Severability. new text end

new text begin If any provision of this section is declared legally invalid
by a court of competent jurisdiction, the remaining provisions shall remain in full force
and effect.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2014.
new text end