<a id="pl.1.3"></a><var>1.3</var>requirements; authorizing counties to provide a bid preference for awarding <br/>
<a id="pl.1.4"></a><var>1.4</var>contracts to veteran-owned small businesses;amending Minnesota Statutes <br/>
<a id="pl.1.5"></a><var>1.5</var>2010, section 161.321; proposing coding for new law in Minnesota Statutes, <br/>
<a id="pl.1.6"></a><var>1.6</var>chapter 375.<br/>
<a id="pl.1.7"></a><var>1.7</var>BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:<br/>
<br/>
<a id="bill.1.0.0"></a>

<a id="bill.1.1.0"></a><a id="pl.1.10"></a><var>1.10</var>    Section 1. Minnesota Statutes 2010, section 161.321, is amended to read:<br/>
<a id="pl.1.11"></a><var>1.11</var><b>161.321 SMALL BUSINESS CONTRACTS.</b><br/>
<a id="pl.1.12"></a><var>1.12</var>    Subdivision 1. <b>Definitions.</b> For purposes of this section the following terms have <br/>
<a id="pl.1.13"></a><var>1.13</var>the meanings given them, except where the context clearly indicates a different meaning is <br/>
<a id="pl.1.14"></a><var>1.14</var>intended.<br/>
<a id="pl.1.15"></a><var>1.15</var>(a) "Award" means the granting of a contract in accordance with all applicable laws <br/>
<a id="pl.1.16"></a><var>1.16</var>and rules governing competitive bidding except as otherwise provided in this section.<br/>
<a id="pl.1.17"></a><var>1.17</var>(b) "Contract" means an agreement entered into between a business entity and the <br/>
<a id="pl.1.18"></a><var>1.18</var>state of Minnesota for the construction of transportation improvements.<br/>
<a id="pl.1.19"></a><var>1.19</var>(c) "Subcontractor" means a business entity which enters into a legally binding <br/>
<a id="pl.1.20"></a><var>1.20</var>agreement with another business entity which is a party to a contract as defined in <br/>
<a id="pl.1.21"></a><var>1.21</var>paragraph (b).<br/>
<a id="pl.1.22"></a><var>1.22</var>(d) "Targeted group business" means a business designated under section 
         <statute_ref>16C.16, <br/>
<a id="pl.1.23"></a><var>1.23</var>subdivision 5
         </statute_ref>.<br/>
<a id="pl.2.1"></a><var>2.1</var>(e) "Veteran-owned small business" means a business designated under section <br/>
<statute_ref><a id="pl.2.2"></a><var>2.2</var>16C.16, subdivision 6a
         </statute_ref>.<br/>
<a id="pl.2.3"></a><var>2.3</var>    Subd. 2. <b>Small</b><b> targeted group business, small</b><b> business </b><b>set-asides</b><b>; contract </b><br/>
<a id="pl.2.4"></a><var>2.4</var><b>preferences</b><b>.</b> (a) The commissioner may award up to a six percent preference in the <br/>
<a id="pl.2.5"></a><var>2.5</var>amount bid for specified construction work to small targeted group businesses and <br/>
<a id="pl.2.6"></a><var>2.6</var>veteran-owned small businesses.<br/>
<a id="pl.2.7"></a><var>2.7</var>(b) The commissioner may designate a contract for construction work for award only <br/>
<a id="pl.2.8"></a><var>2.8</var>to small targeted group businesses if the commissioner determines that at least three small <br/>
<a id="pl.2.9"></a><var>2.9</var>targeted group businesses are likely to bid. The commissioner may designate a contract for <br/>
<a id="pl.2.10"></a><var>2.10</var>construction work for award only to veteran-owned small businesses if the commissioner <br/>
<a id="pl.2.11"></a><var>2.11</var>determines that at least three veteran-owned small businesses are likely to bid.<br/>
<a id="pl.2.12"></a><var>2.12</var>(c) The commissioner, as a condition of awarding a construction contract, may <br/>
<a id="pl.2.13"></a><var>2.13</var>set goals that require the prime contractor to subcontract a portion of the contract to <br/>
<a id="pl.2.14"></a><var>2.14</var>small targeted group businesses and veteran-owned small businesses. The commissioner <br/>
<a id="pl.2.15"></a><var>2.15</var>must establish a procedure for granting waivers from the subcontracting requirement <br/>
<a id="pl.2.16"></a><var>2.16</var>when qualified small targeted group businesses and veteran-owned small businesses <br/>
<a id="pl.2.17"></a><var>2.17</var>are not reasonably available. The commissioner may establish financial incentives for <br/>
<a id="pl.2.18"></a><var>2.18</var>prime contractors who exceed the goals for use of subcontractors and financial penalties <br/>
<a id="pl.2.19"></a><var>2.19</var>for prime contractors who fail to meet goals under this paragraph. The subcontracting <br/>
<a id="pl.2.20"></a><var>2.20</var>requirements of this paragraph do not apply to prime contractors who are small targeted <br/>
<a id="pl.2.21"></a><var>2.21</var>group businesses or veteran-owned small businesses.<br/>
<a id="pl.2.22"></a><var>2.22</var>(d) (c) The commissioner may award up to a four percent preference in the amount <br/>
<a id="pl.2.23"></a><var>2.23</var>bid on procurement for specified construction work to small businesses located in an <br/>
<a id="pl.2.24"></a><var>2.24</var>economically disadvantaged area as defined in section 
         <statute_ref>16C.16, subdivision 7</statute_ref>.<br/>
<a id="pl.2.25"></a><var>2.25</var>    Subd. 2a. <b>Small targeted group business; subcontracting goals.</b> (a) The <br/>
<a id="pl.2.26"></a><var>2.26</var>commissioner, as a condition of awarding a construction contract, may set goals that <br/>
<a id="pl.2.27"></a><var>2.27</var>require the prime contractor to subcontract portions of the contract to small targeted <br/>
<a id="pl.2.28"></a><var>2.28</var>group businesses. Prime contractors must demonstrate good faith efforts to meet the <br/>
<a id="pl.2.29"></a><var>2.29</var>project goals. The commissioner shall establish a procedure for granting waivers from <br/>
<a id="pl.2.30"></a><var>2.30</var>the subcontracting requirement when qualified small targeted group businesses are not <br/>
<a id="pl.2.31"></a><var>2.31</var>reasonably available. The commissioner may establish (1) financial incentives for prime <br/>
<a id="pl.2.32"></a><var>2.32</var>contractors who exceed the goals set for the use of subcontractors under this subdivision; <br/>
<a id="pl.2.33"></a><var>2.33</var>and (2) sanctions for prime contractors who fail to make good faith efforts to meet the <br/>
<a id="pl.2.34"></a><var>2.34</var>goals set under this subdivision.<br/>
<a id="pl.2.35"></a><var>2.35</var>(b) The small targeted group business subcontracting requirements of this <br/>
<a id="pl.2.36"></a><var>2.36</var>subdivision do not apply to prime contractors who are small targeted group businesses.<br/>
<a id="pl.3.1"></a><var>3.1</var>    Subd. 2b. <b>Veteran-owned small business; contract preferences.</b> (a) The <br/>
<a id="pl.3.2"></a><var>3.2</var>commissioner may award up to a six percent preference in the amount bid for specified <br/>
<a id="pl.3.3"></a><var>3.3</var>construction work to veteran-owned small businesses, except when prohibited by the <br/>
<a id="pl.3.4"></a><var>3.4</var>federal government as a condition of receiving federal funds. When a bid preference is <br/>
<a id="pl.3.5"></a><var>3.5</var>provided under this subdivision, the percentage of preference in bid amount may not be <br/>
<a id="pl.3.6"></a><var>3.6</var>less than the percentage of bid preference provided to any small targeted group business <br/>
<a id="pl.3.7"></a><var>3.7</var>under subdivision 2.<br/>
<a id="pl.3.8"></a><var>3.8</var>(b) When a bid preference is provided under this subdivision, the commissioner <br/>
<a id="pl.3.9"></a><var>3.9</var>must be as inclusive as possible in specifying contracts for construction work, as well <br/>
<a id="pl.3.10"></a><var>3.10</var>as for construction-related professional and technical services, available under this bid <br/>
<a id="pl.3.11"></a><var>3.11</var>preference program for veteran-owned small businesses. The term "construction" must be <br/>
<a id="pl.3.12"></a><var>3.12</var>given broad meaning for purposes of specifying and letting contracts for veteran-owned <br/>
<a id="pl.3.13"></a><var>3.13</var>small businesses and must include, but is not limited to, preplanning, planning, and all <br/>
<a id="pl.3.14"></a><var>3.14</var>other construction-related professional and technical services.<br/>
<a id="pl.3.15"></a><var>3.15</var>(c) When a bid preference is provided under this subdivision, the commissioner <br/>
<a id="pl.3.16"></a><var>3.16</var>must strive to ensure that contracts will be awarded on a proportional basis with contracts <br/>
<a id="pl.3.17"></a><var>3.17</var>awarded under subdivision 2.<br/>
<a id="pl.3.18"></a><var>3.18</var>(d) The commissioner may designate a contract for construction work for award <br/>
<a id="pl.3.19"></a><var>3.19</var>only to veteran-owned small businesses, if the commissioner determines that at least three <br/>
<a id="pl.3.20"></a><var>3.20</var>veteran-owned small businesses are likely to bid.<br/>
<a id="pl.3.21"></a><var>3.21</var>    Subd. 2c. <b>Veteran-owned small business; subcontracting goals.</b> (a) The <br/>
<a id="pl.3.22"></a><var>3.22</var>commissioner, as a condition of awarding a construction contract, may set goals that <br/>
<a id="pl.3.23"></a><var>3.23</var>require the prime contractor to subcontract portions of the contract to veteran-owned small <br/>
<a id="pl.3.24"></a><var>3.24</var>businesses, except when prohibited by federal law or rule as a condition of receiving <br/>
<a id="pl.3.25"></a><var>3.25</var>federal funds. Prime contractors must demonstrate good faith efforts to meet the project <br/>
<a id="pl.3.26"></a><var>3.26</var>goals. The commissioner shall establish a procedure for granting waivers from the <br/>
<a id="pl.3.27"></a><var>3.27</var>subcontracting requirement when qualified veteran-owned small businesses are not <br/>
<a id="pl.3.28"></a><var>3.28</var>reasonably available. The commissioner may establish (1) financial incentives for prime <br/>
<a id="pl.3.29"></a><var>3.29</var>contractors who exceed the goals set for the use of subcontractors under this subdivision; <br/>
<a id="pl.3.30"></a><var>3.30</var>and (2) sanctions for prime contractors who have not been granted a waiver and fail <br/>
<a id="pl.3.31"></a><var>3.31</var>to meet goals set under this subdivision.<br/>
<a id="pl.3.32"></a><var>3.32</var>(b) The subcontracting requirements of this subdivision do not apply to prime <br/>
<a id="pl.3.33"></a><var>3.33</var>contractors who are veteran-owned small businesses.<br/>
<a id="pl.3.34"></a><var>3.34</var>    Subd. 3. <b>Small targeted group business subcontract </b><b>awards </b><b>to small businesses</b><b>.</b><br/>
<a id="pl.3.35"></a><var>3.35</var>At least 75 percent of subcontracts awarded to small targeted group businesses must be <br/>
<a id="pl.4.1"></a><var>4.1</var>performed by the business to which the subcontract is awarded or another small targeted <br/>
<a id="pl.4.2"></a><var>4.2</var>group business. <br/>
<a id="pl.4.3"></a><var>4.3</var>    Subd. 3a. <b>Veteran-owned small business; subcontract awards.</b> At least 75 <br/>
<a id="pl.4.4"></a><var>4.4</var>percent of subcontracts awarded to veteran-owned small businesses must be performed by <br/>
<a id="pl.4.5"></a><var>4.5</var>the business to which the subcontract is awarded or another veteran-owned small business.<br/>
<a id="pl.4.6"></a><var>4.6</var>    Subd. 4. <b>Contract </b><b>awards, limitations.</b> Contracts awarded pursuant to this <br/>
<a id="pl.4.7"></a><var>4.7</var>section are subject to all limitations contained in rules adopted by the commissioner <br/>
<a id="pl.4.8"></a><var>4.8</var>of administration.<br/>
<a id="pl.4.9"></a><var>4.9</var>    Subd. 4a. <b>Small targeted group business; limited duration and reevaluation.</b><br/>
<a id="pl.4.10"></a><var>4.10</var>The commissioner shall cooperate with the commissioner of administration to periodically <br/>
<a id="pl.4.11"></a><var>4.11</var>reevaluate the targeted group businesses to determine whether there is a statistical disparity <br/>
<a id="pl.4.12"></a><var>4.12</var>between the percentage of construction contracts awarded to businesses owned by targeted <br/>
<a id="pl.4.13"></a><var>4.13</var>group members and the representation of businesses owned by targeted group members <br/>
<a id="pl.4.14"></a><var>4.14</var>among all businesses in the state in the construction category. The commissioner of <br/>
<a id="pl.4.15"></a><var>4.15</var>administration shall designate targeted groups pursuant to section 16C.16, subdivision 5.<br/>
<a id="pl.4.16"></a><var>4.16</var>    Subd. 5. <b>Recourse to other businesses.</b> If the commissioner is unable to award <br/>
<a id="pl.4.17"></a><var>4.17</var>a contract pursuant to the provisions of subdivisions 2 and 3 to 4a, the award may be <br/>
<a id="pl.4.18"></a><var>4.18</var>placed pursuant to the normal solicitation and award provisions set forth in this chapter <br/>
<a id="pl.4.19"></a><var>4.19</var>and chapter 16C.<br/>
<a id="pl.4.20"></a><var>4.20</var>    Subd. 6. <b>Rules</b><b>; eligibility</b><b>.</b> (a) The rules adopted by the commissioner of <br/>
<a id="pl.4.21"></a><var>4.21</var>administration to define small businesses and to set time and other eligibility requirements <br/>
<a id="pl.4.22"></a><var>4.22</var>for participation in programs under sections 
         <statute_ref>16C.16</statute_ref> to 
         <statute_ref>16C.19</statute_ref> apply to this section. The <br/>
<a id="pl.4.23"></a><var>4.23</var>commissioner may promulgate other rules necessary to carry out this section.<br/>
<a id="pl.4.24"></a><var>4.24</var>(b) In addition to other eligibility requirements, a small targeted group business or <br/>
<a id="pl.4.25"></a><var>4.25</var>veteran-owned small business is eligible for the bid preferences under this section only for <br/>
<a id="pl.4.26"></a><var>4.26</var>eight years following the latest of:<br/>
<a id="pl.4.27"></a><var>4.27</var>(1) the effective date of this section;<br/>
<a id="pl.4.28"></a><var>4.28</var>(2) for a targeted group business, the date of initial certification by the commissioner <br/>
<a id="pl.4.29"></a><var>4.29</var>of administration, as provided under section 16C.19;<br/>
<a id="pl.4.30"></a><var>4.30</var>(3) for a veteran-owned small business, the date of initial certification by the United <br/>
<a id="pl.4.31"></a><var>4.31</var>States Department of Veterans Affairs, as provided under section 16C.19, paragraph (d); or<br/>
<a id="pl.4.32"></a><var>4.32</var>(4) for a veteran-owned small business, the release or discharge of any one of the <br/>
<a id="pl.4.33"></a><var>4.33</var>owners from military active service, as defined in section 190.05, subdivision 5, lasting for <br/>
<a id="pl.4.34"></a><var>4.34</var>a period of 179 days or longer.<br/>
<a id="pl.4.35"></a><var>4.35</var>    Subd. 7. <b>Noncompetitive bids.</b> The commissioner is encouraged to purchase <br/>
<a id="pl.4.36"></a><var>4.36</var>from small targeted group businesses and veteran-owned small businesses designated <br/>
<a id="pl.5.1"></a><var>5.1</var>under section 
         <statute_ref>16C.16</statute_ref> when making purchases that are not subject to competitive bidding <br/>
<a id="pl.5.2"></a><var>5.2</var>procedures.<br/>
<a id="pl.5.3"></a><var>5.3</var>    Subd. 8. <b>Report by commissioner</b><b> Reporting</b><b>.</b> (a) The commissioner of <br/>
<a id="pl.5.4"></a><var>5.4</var>transportation shall report to the commissioner of administration on compliance with this <br/>
<a id="pl.5.5"></a><var>5.5</var>section. The information must be reported at the time and in the manner requested by the <br/>
<a id="pl.5.6"></a><var>5.6</var>commissioner of administration.<br/>
<a id="pl.5.7"></a><var>5.7</var>(b) By February 1 of each even-numbered year, the commissioner of transportation <br/>
<a id="pl.5.8"></a><var>5.8</var>shall submit a report to the chairs and ranking minority members of the legislative <br/>
<a id="pl.5.9"></a><var>5.9</var>committees with jurisdiction over transportation policy and finance and veterans policy <br/>
<a id="pl.5.10"></a><var>5.10</var>and finance concerning contract awards during the preceding biennium under this section. <br/>
<a id="pl.5.11"></a><var>5.11</var>At a minimum, the report must include:<br/>
<a id="pl.5.12"></a><var>5.12</var>(1) a summary of the program;<br/>
<a id="pl.5.13"></a><var>5.13</var>(2) a review of the use of preferences for contracting during the preceding biennium, <br/>
<a id="pl.5.14"></a><var>5.14</var>including frequency of establishment of a preference and frequency and amount of <br/>
<a id="pl.5.15"></a><var>5.15</var>contract awards to:<br/>
<a id="pl.5.16"></a><var>5.16</var>(i) small targeted group businesses; and<br/>
<a id="pl.5.17"></a><var>5.17</var>(ii) veteran-owned small businesses;<br/>
<a id="pl.5.18"></a><var>5.18</var>(3) a review of goals and good faith efforts to use small targeted group businesses <br/>
<a id="pl.5.19"></a><var>5.19</var>and veteran-owned small businesses in subcontracts, including analysis of methods used <br/>
<a id="pl.5.20"></a><var>5.20</var>for, and effectiveness of, good faith efforts;<br/>
<a id="pl.5.21"></a><var>5.21</var>(4) a summary of any financial incentives used or sanctions imposed;<br/>
<a id="pl.5.22"></a><var>5.22</var>(5) agency commentary on any perceived impediments, whether statutory, <br/>
<a id="pl.5.23"></a><var>5.23</var>administrative, or otherwise, that may be limiting the participation of small targeted <br/>
<a id="pl.5.24"></a><var>5.24</var>group businesses and veteran-owned small businesses in the agency's contract preference <br/>
<a id="pl.5.25"></a><var>5.25</var>program;<br/>
<a id="pl.5.26"></a><var>5.26</var>(6) information on each reevaluation under subdivision 4a, including details on the <br/>
<a id="pl.5.27"></a><var>5.27</var>methodology for reevaluation; and<br/>
<a id="pl.5.28"></a><var>5.28</var>(7) any recommendations for legislative or programmatic changes.<br/>
<a id="pl.5.29"></a><var>5.29</var>    Subd. 9. <b>Veteran-owned small business; purpose.</b> The purpose of the state <br/>
<a id="pl.5.30"></a><var>5.30</var>contracting bid preference program for veteran-owned small businesses is to facilitate <br/>
<a id="pl.5.31"></a><var>5.31</var>the healthy transition of veterans from military to civilian life, and to help compensate <br/>
<a id="pl.5.32"></a><var>5.32</var>veterans for their sacrifices including, but not limited to, their sacrifice of health and <br/>
<a id="pl.5.33"></a><var>5.33</var>time to the state and nation during their military service, as well as to enhance economic <br/>
<a id="pl.5.34"></a><var>5.34</var>development within Minnesota.<br/>
<a id="pl.5.35"></a><var>5.35</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment, <br/>
<a id="pl.5.36"></a><var>5.36</var>and applies to contracts let on or after July 1, 2012.<br/>
<br/>
<a id="bill.2.0.0"></a>

<a id="pl.6.3"></a><var>6.3</var><b>VETERAN-OWNED SMALL BUSINESSES</b><br/>

<a id="bill.2.1.0"></a><a id="pl.6.4"></a><var>6.4</var>    Section 1. <b>[375.771] VETERAN-OWNED SMALL BUSINESS CONTRACTS.</b><br/>
<a id="pl.6.5"></a><var>6.5</var>    Subdivision 1. <b>Definitions.</b> (a) The definitions in this subdivision apply to this <br/>
<a id="pl.6.6"></a><var>6.6</var>section.<br/>
<a id="pl.6.7"></a><var>6.7</var>(b) "Award" means the granting of a contract in accordance with all applicable laws <br/>
<a id="pl.6.8"></a><var>6.8</var>and rules governing competitive bidding, except as otherwise provided in this section.<br/>
<a id="pl.6.9"></a><var>6.9</var>(c) "Contract" means an agreement entered into between a business entity and the <br/>
<a id="pl.6.10"></a><var>6.10</var>county for procurement of goods and services including both technical and nontechnical <br/>
<a id="pl.6.11"></a><var>6.11</var>goods and services, printing, and construction.<br/>
<a id="pl.6.12"></a><var>6.12</var>(d) "County board" or "board" has the meaning given in section 375.01.<br/>
<a id="pl.6.13"></a><var>6.13</var>(e) "County purchasing department" has the meaning given in section 375.72.<br/>
<a id="pl.6.14"></a><var>6.14</var>(f) "Director of purchasing" has the meaning given in section 375.74.<br/>
<a id="pl.6.15"></a><var>6.15</var>(g) "Subcontractor" means a business entity that enters into a legally binding <br/>
<a id="pl.6.16"></a><var>6.16</var>agreement with another business entity that is a party to a contract as defined in paragraph <br/>
<a id="pl.6.17"></a><var>6.17</var>(c).<br/>
<a id="pl.6.18"></a><var>6.18</var>(h) "Veteran" has the meaning given in section 197.447.<br/>
<a id="pl.6.19"></a><var>6.19</var>(i) "Veteran-owned small business" means a business designated under section <br/>
<a id="pl.6.20"></a><var>6.20</var>16C.16, subdivision 6a.<br/>
<a id="pl.6.21"></a><var>6.21</var>    Subd. 2. <b>Policy; purpose; director.</b> (a) A county board may establish a program <br/>
<a id="pl.6.22"></a><var>6.22</var>within the county in accordance with this section to provide a bid preference for <br/>
<a id="pl.6.23"></a><var>6.23</var>awarding contracts to designated veteran-owned small businesses for the procurement of <br/>
<a id="pl.6.24"></a><var>6.24</var>technical and nontechnical goods and services including, but not limited to, printing and <br/>
<a id="pl.6.25"></a><var>6.25</var>construction, broadly defined to include all phases of the construction process.<br/>
<a id="pl.6.26"></a><var>6.26</var>(b) The purpose of this program is to facilitate the transition of veterans from <br/>
<a id="pl.6.27"></a><var>6.27</var>military to civilian life, and to help compensate veterans for their sacrifices including, but <br/>
<a id="pl.6.28"></a><var>6.28</var>not limited to, their sacrifice of health and time to the community, state, and nation during <br/>
<a id="pl.6.29"></a><var>6.29</var>their military service, as well as to enhance economic development throughout Minnesota.<br/>
<a id="pl.6.30"></a><var>6.30</var>(c) The county board may direct the county director of purchasing, or other <br/>
<a id="pl.6.31"></a><var>6.31</var>designated official within the county purchasing department, to administer this program in <br/>
<a id="pl.6.32"></a><var>6.32</var>accordance with county policy established by the board.<br/>
<a id="pl.6.33"></a><var>6.33</var>    Subd. 3. <b>Small business set-asides.</b> (a) The county director of purchasing may <br/>
<a id="pl.6.34"></a><var>6.34</var>award up to a six percent preference in the amount bid for procurement of goods and <br/>
<a id="pl.6.35"></a><var>6.35</var>services including, but not limited to, technical and nontechnical goods and services, <br/>
<a id="pl.7.1"></a><var>7.1</var>printing, and construction to veteran-owned small businesses having their principal place <br/>
<a id="pl.7.2"></a><var>7.2</var>of business in Minnesota.<br/>
<a id="pl.7.3"></a><var>7.3</var>(b) The board, as a condition of awarding a construction contract, may set goals that <br/>
<a id="pl.7.4"></a><var>7.4</var>require the prime contractor to subcontract a portion of the contract to  veteran-owned <br/>
<a id="pl.7.5"></a><var>7.5</var>small businesses. The board must establish a procedure for granting waivers from the <br/>
<a id="pl.7.6"></a><var>7.6</var>subcontracting requirement when qualified veteran-owned small businesses are not <br/>
<a id="pl.7.7"></a><var>7.7</var>reasonably available. The board may establish financial incentives for prime contractors <br/>
<a id="pl.7.8"></a><var>7.8</var>who exceed the goals for use of veteran-owned small business subcontractors and <br/>
<a id="pl.7.9"></a><var>7.9</var>financial penalties for prime contractors who fail to meet goals under this paragraph. The <br/>
<a id="pl.7.10"></a><var>7.10</var>subcontracting requirements of this paragraph do not apply to prime contractors who are <br/>
<a id="pl.7.11"></a><var>7.11</var>veteran-owned small businesses.<br/>
<a id="pl.7.12"></a><var>7.12</var>    Subd. 4. <b>Awards to small businesses.</b> At least 75 percent of subcontracts awarded <br/>
<a id="pl.7.13"></a><var>7.13</var>to veteran-owned small businesses must be performed by the business to which the <br/>
<a id="pl.7.14"></a><var>7.14</var>subcontract is awarded or another veteran-owned small business.<br/>
<a id="pl.7.15"></a><var>7.15</var>    Subd. 5. <b>Awards, limitations.</b> Contracts awarded under this section are subject to <br/>
<a id="pl.7.16"></a><var>7.16</var>all limitations adopted by the board.<br/>
<a id="pl.7.17"></a><var>7.17</var>    Subd. 6. <b>Recourse to other businesses.</b> If the director is unable to award a contract <br/>
<a id="pl.7.18"></a><var>7.18</var>under subdivisions 3 and 4, the award may be placed under normal solicitation and award <br/>
<a id="pl.7.19"></a><var>7.19</var>statutes and rules.<br/>
<a id="pl.7.20"></a><var>7.20</var>    Subd. 7. <b>Noncompetitive bids.</b> The board is encouraged to purchase from <br/>
<a id="pl.7.21"></a><var>7.21</var>veteran-owned small businesses designated under section 16C.16, subdivision 6a, when <br/>
<a id="pl.7.22"></a><var>7.22</var>making purchases that are not subject to competitive bidding procedures.<br/>
<a id="pl.7.23"></a><var>7.23</var>    Subd. 8. <b>Report to board.</b> At the request of the county board, the county treasurer <br/>
<a id="pl.7.24"></a><var>7.24</var>shall report to the board on compliance with this section. The information must be <br/>
<a id="pl.7.25"></a><var>7.25</var>reported at the time and in the manner requested by the board.<br/>
<a id="pl.7.26"></a><var>7.26</var><b>EFFECTIVE DATE.</b>This section is effective July 1, 2012, for contracts awarded <br/>
<a id="pl.7.27"></a><var>7.27</var>by counties on or after that date.<br/>