1998 Minnesota Statutes

     161.321 Small business contracts. 

    Subdivision 1.    Definitions.  For purposes of this 
 section the following terms have the meanings given them, except 
 where the context clearly indicates a different meaning is 
 intended. 

    (a) "Award" means the granting of a contract in accordance 
 with all applicable laws and rules governing competitive bidding 
 except as otherwise provided in this section. 

    (b) "Contract" means an agreement entered into between a 
 business entity and the state of Minnesota for the construction 
 of transportation improvements. 

    (c) "Subcontractor" means a business entity which enters 
 into a legally binding agreement with another business entity 
 which is a party to a contract as defined in clause (b). 

    (d) "Targeted group business" means a business designated 
 under section 16C.16, subdivision 5. 

    Subd. 2.    Small business set-asides.  (a) The 
 commissioner may award up to a six percent preference in the 
 amount bid for specified construction work to small targeted 
 group businesses. 

    (b) The commissioner may designate a contract for 
 construction work for award only to small targeted group 
 businesses if the commissioner determines that at least three 
 small targeted group businesses are likely to bid. 

    (c) The commissioner, as a condition of awarding a 
 construction contract, may set goals that require the prime 
 contractor to subcontract a portion of the contract to small 
 targeted group businesses.  The commissioner must establish a 
 procedure for granting waivers from the subcontracting 
 requirement when qualified small targeted group businesses are 
 not reasonably available.  The commissioner may establish 
 financial incentives for prime contractors who exceed the goals 
 for use of subcontractors and financial penalties for prime 
 contractors who fail to meet goals under this paragraph.  The 
 subcontracting requirements of this paragraph do not apply to 
 prime contractors who are small targeted group businesses. 

    (d) The commissioner may award up to a four percent 
 preference in the amount bid on procurement to small businesses 
 located in an economically disadvantaged area as defined in 
 section 16C.16, subdivision 7.  

    Subd. 3.    Awards to small businesses.  At least 75 
 percent of subcontracts awarded to small targeted group 
 businesses must be performed by the business to which the 
 subcontract is awarded or another small targeted group business. 

    Subd. 4.    Awards, limitations.  Contracts awarded 
 pursuant to this section are subject to all limitations 
 contained in rules adopted by the commissioner of administration.

    Subd. 5.    Recourse to other businesses.  If the 
 commissioner is unable to award a contract pursuant to the 
 provisions of subdivisions 2 and 3, the award may be placed 
 pursuant to the normal solicitation and award provisions set 
 forth in this chapter and chapter 16C. 

    Subd. 6.    Rules.  The rules adopted by the 
 commissioner of administration to define small businesses and to 
 set time and other eligibility requirements for participation in 
 programs under sections 16C.16 to 16C.19 apply to this section.  
 The commissioner may promulgate other rules necessary to carry 
 out this section. 

    Subd. 7.    Noncompetitive bids.  The commissioner is 
 encouraged to purchase from small targeted group businesses 
 designated under section 16C.16 when making purchases that are 
 not subject to competitive bidding procedures. 

    HIST: 1977 c 222 s 1; 1978 c 506 s 1; 1979 c 246 s 1; 1980 c 
 361 s 1,2; 1984 c 544 s 89; 1989 c 352 s 14-16,25; 1990 c 541 s 
 17-23,29; 1998 c 386 art 2 s 59-63