2000 Minnesota Statutes

     16C.05 Contract management; validity and review. 

    Subdivision 1.    Agency cooperation.  Agencies shall 
 fully cooperate with the commissioner in the management and 
 review of state contracts. 

    Subd. 2.    Creation and validity of contracts.  (a) A 
 contract is not valid and the state is not bound by it unless: 

    (1) it has first been executed by the head of the agency or 
 a delegate who is a party to the contract; 

    (2) it has been approved by the commissioner; 

    (3) it has been approved by the attorney general or a 
 delegate as to form and execution; 

    (4) the accounting system shows an obligation in an expense 
 budget or encumbrance for the amount of the contract liability; 
 and 

    (5) the combined contract and amendments shall not exceed 
 five years without specific, written approval by the 
 commissioner according to established policy, procedures, and 
 standards, or unless otherwise provided for by law.  The term of 
 the original contract must not exceed two years unless the 
 commissioner determines that a longer duration is in the best 
 interest of the state.  

    (b) Grants, interagency agreements, purchase orders, and 
 annual plans need not, in the discretion of the commissioner and 
 attorney general, require the signature of the commissioner 
 and/or the attorney general.  Bond purchase agreements by the 
 Minnesota public facilities authority do not require the 
 approval of the commissioner.  

    (c) A fully executed copy of every contract must be kept on 
 file at the contracting agency. 

    Subd. 3.    Exception.  The requirements of subdivision 
 2 do not apply to contracts of the department of economic 
 security distributing state and federal funds for the purpose of 
 subcontracting the provision of program services to eligible 
 recipients.  For these contracts, the commissioner of economic 
 security is authorized to directly enter into agency contracts 
 and encumber available funds.  For contracts distributing state 
 or federal funds pursuant to the federal Economic Dislocation 
 and Worker Adjustment Assistance Act, United States Code, title 
 29, section 1651 et seq., or sections 268.9771, 268.978, 
 268.9781, and 268.9782, the commissioner of economic security is 
 authorized to directly enter into agency contracts with approval 
 of the workforce development council and encumber available 
 funds to ensure a rapid response to the needs of dislocated 
 workers.  The commissioner of economic security shall adopt 
 internal procedures to administer and monitor funds distributed 
 under these contracts.  This exception also applies to any 
 contracts entered into by the commissioner of children, 
 families, and learning and the jobs skills partnership board 
 that were previously entered into by the commissioner of 
 economic security. 

    Subd. 4.    Contract administration.  A contracting 
 agency shall diligently administer and monitor any contract it 
 has entered into, pursuant to a delegation of duties from the 
 commissioner.  The commissioner may require an agency to report 
 to the commissioner at any time on the status of any contracts 
 to which the agency is a party. 

    Subd. 5.    Subject to audit.  A contract or any 
 pass-through disbursement of public funds to a vendor of goods 
 or services or a grantee made by or under the supervision of the 
 commissioner or any county or unit of local government must 
 include, expressed or implied, an audit clause that provides 
 that the books, records, documents, and accounting procedures 
 and practices of the vendor or other party, that are relevant to 
 the contract or transaction, are subject to examination by the 
 contracting agency and either the legislative auditor or the 
 state auditor, as appropriate, for a minimum of six years.  If 
 the contracting agency is a local unit of government, and the 
 governing body of the local unit of government requests that the 
 state auditor examine the books, records, documents, and 
 accounting procedures and practices of the vendor or other party 
 pursuant to this subdivision, the contracting agency shall be 
 liable for the cost of the examination.  If the contracting 
 agency is a local unit of government, and the grantee, vendor, 
 or other party requests that the state auditor examine all 
 books, records, documents, and accounting procedures and 
 practices related to the contract, the grantee, vendor, or other 
 party that requested the examination shall be liable for the 
 cost of the examination.  An agency contract made for purchase, 
 lease, or license of software and data from the state is not 
 required to contain this audit clause. 

    Subd. 6.    Authority of attorney general.  The attorney 
 general may pursue remedies available by law to avoid the 
 obligation of an agency to pay under a contract or to recover 
 payments made if services performed or goods received under the 
 contract are so unsatisfactory, incomplete, or inconsistent that 
 payment would involve unjust enrichment.  The contrary opinion 
 of the contracting agency does not affect the power of the 
 attorney general under this subdivision. 

    Subd. 7.    Contracts with Indian tribes and bands.  
 Notwithstanding any other law, an agency may not require an 
 Indian tribe or band to deny its sovereignty as a requirement or 
 condition of a contract with an agency. 

    HIST: 1998 c 386 art 1 s 6; 1999 c 86 art 1 s 11; 1999 c 230 s 
 1; 2000 c 488 art 2 s 1