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    Subdivision 1. Contracts. A contract for work or labor, or for the purchase of furniture,
fixtures, or other property, except books registered under the copyright laws, or for the construction
or repair of school houses, the estimated cost or value of which shall exceed that specified in
section 471.345, subdivision 3, must not be made by the school board without first advertising for
bids or proposals by two weeks' published notice in the official newspaper. This notice must state
the time and place of receiving bids and contain a brief description of the subject matter.
Additional publication in the official newspaper or elsewhere may be made as the board
shall deem necessary.
After taking into consideration conformity with the specifications, terms of delivery, and
other conditions imposed in the call for bids, every such contract must be awarded to the lowest
responsible bidder, be duly executed in writing, and be otherwise conditioned as required by
law. The person to whom the contract is awarded shall give a sufficient bond to the board for
its faithful performance. Notwithstanding section 574.26 or any other law to the contrary, on
a contract limited to the purchase of a finished tangible product, a board may require, at its
discretion, a performance bond of a contractor in the amount the board considers necessary. A
record must be kept of all bids, with names of bidders and amount of bids, and with the successful
bid indicated thereon. A bid containing an alteration or erasure of any price contained in the bid
which is used in determining the lowest responsible bid must be rejected unless the alteration or
erasure is corrected as provided in this section. An alteration or erasure may be crossed out and the
correction thereof printed in ink or typewritten adjacent thereto and initialed in ink by the person
signing the bid. In the case of identical low bids from two or more bidders, the board may, at its
discretion, utilize negotiated procurement methods with the tied low bidders for that particular
transaction, so long as the price paid does not exceed the low tied bid price. In the case where only
a single bid is received, the board may, at its discretion, negotiate a mutually agreeable contract
with the bidder so long as the price paid does not exceed the original bid. If no satisfactory bid is
received, the board may readvertise. Standard requirement price contracts established for supplies
or services to be purchased by the district must be established by competitive bids. Such standard
requirement price contracts may contain escalation clauses and may provide for a negotiated price
increase or decrease based upon a demonstrable industrywide or regional increase or decrease in
the vendor's costs. Either party to the contract may request that the other party demonstrate such
increase or decrease. The term of such contracts must not exceed two years with an option on the
part of the district to renew for an additional two years. Contracts for the purchase of perishable
food items, except milk for school lunches and vocational training programs, in any amount may
be made by direct negotiation by obtaining two or more written quotations for the purchase or
sale, when possible, without advertising for bids or otherwise complying with the requirements
of this section or section 471.345, subdivision 3. All quotations obtained shall be kept on file
for a period of at least one year after receipt.
Every contract made without compliance with the provisions of this section shall be void.
Except in the case of the destruction of buildings or injury thereto, where the public interest would
suffer by delay, contracts for repairs may be made without advertising for bids.
    Subd. 1a. Construction contracts. A project labor agreement is a hiring agreement
that establishes wages, uniform work schedules, and rules for dispute resolution to manage
construction projects that generally require, among other things, payment of union dues or fees to
a labor organization or membership in or affiliation with a labor organization. A school board
must adopt at a public meeting a written resolution authorizing a project labor agreement to
construct or repair a facility through a contract or bid. The board must publish in the official
newspaper of the district notice of the meeting at least 30 days in advance.
    Subd. 2. Contract within budgeted amounts. The board may authorize its superintendent
or business manager to lease, purchase, and contract for goods and services within the budget
as approved by the board. Any transaction in an amount exceeding the minimum amount for
which bids are required must first be specifically authorized by the board and must fulfill all
other applicable requirements in subdivision 1.
    Subd. 3. Transportation; fuel. Notwithstanding the provisions of subdivision 1 or section
471.345, a contract for the transportation of school children, or a contract for the purchase of
petroleum heating fuel or fuel for vehicles may be made by direct negotiation, by obtaining two
or more written quotations for the service when possible, or upon sealed bids. At least 30 days
before awarding a directly negotiated contract, the district must, by published notice, request
quotations for the service to be provided. All quotations obtained must be kept on file for a period
of at least one year after receipt. If a contract is made by direct negotiation, all quotations must
be public information. If a contract is made upon sealed bids, the procedure for advertising and
awarding bids shall conform to the provisions of subdivision 1 except as otherwise provided in
this subdivision.
Notwithstanding the provisions of subdivision 1 or section 574.26, a performance bond must
be required of a contractor on a contract for the transportation of school children only when
deemed necessary by and at the discretion of the board. Such a performance bond must be in the
amount determined by the board.
    Subd. 4. Asbestos removal and polychlorinated biphenyls cleanup. Notwithstanding any
law to the contrary, districts may, without an election, enter into contracts extending beyond the
end of the fiscal year to pay the costs of removal or encapsulation of asbestos or cleanup of
polychlorinated biphenyls found in school buildings or on school property.
    Subd. 5. Contracts with board members. Members of the board are authorized to contract
with, to work for, and furnish supplies to the district subject to the provisions of section 471.87.
    Subd. 6. Disposing of surplus school computers. Notwithstanding section 471.345,
governing school district contracts made upon sealed bid or otherwise complying with the
requirements for competitive bidding, other provisions of this section governing school district
contracts, or other law to the contrary, a school district under this subdivision may dispose of a
surplus school computer and related equipment if the district disposes of the surplus property by
conveying the property and title to:
(1) another school district;
(2) the state Department of Corrections;
(3) the Board of Trustees of the Minnesota State Colleges and Universities; or
(4) the family of a student residing in the district whose total family income meets the
federal definition of poverty.
History: Ex1959 c 71 art 4 s 18,19; Ex1967 c 1 s 6; 1969 c 107 s 1; 1973 c 123 art 5 s 7;
1974 c 521 s 13-15; 1975 c 59 s 1,2; 1975 c 199 s 1; 1976 c 168 s 1; 1976 c 239 s 32; 1976 c 271
s 39,40; 1978 c 706 s 16-18; 1978 c 764 s 33-35; 1979 c 295 s 1; 1980 c 609 art 6 s 17,18; 1981 c
358 art 6 s 13; 1982 c 548 art 4 s 8; 1983 c 314 art 2 s 1; art 6 s 5,6; art 7 s 20; 1984 c 463 art 7 s
9,10; 1985 c 279 s 1; 1Sp1985 c 12 art 7 s 14; 1986 c 444; 1987 c 258 s 6; 1987 c 398 art 7 s 21;
1989 c 222 s 9; 1989 c 246 s 2; 1989 c 329 art 5 s 3,4; 1990 c 375 s 3; 1990 c 562 art 7 s 4; art 8
s 23,24; 1991 c 130 s 37; 1992 c 499 art 12 s 29; 1993 c 224 art 5 s 2; 1Sp1995 c 3 art 16 s 13;
1996 c 412 art 13 s 13; 1998 c 397 art 6 s 69-77,124; 2000 c 489 art 5 s 3; 1Sp2003 c 9 art 4 s 3