1.1.................... moves to amend S.F. No. 1597, the third engrossment, as follows:
1.2Delete everything after the enacting clause and insert:


1.5    Section 1. Minnesota Statutes 2010, section 161.321, is amended to read:
1.6161.321 SMALL BUSINESS CONTRACTS.
1.7    Subdivision 1. Definitions. For purposes of this section the following terms have
1.8the meanings given them, except where the context clearly indicates a different meaning is
1.9intended.
1.10(a) "Award" means the granting of a contract in accordance with all applicable laws
1.11and rules governing competitive bidding except as otherwise provided in this section.
1.12(b) "Contract" means an agreement entered into between a business entity and the
1.13state of Minnesota for the construction of transportation improvements.
1.14(c) "Subcontractor" means a business entity which enters into a legally binding
1.15agreement with another business entity which is a party to a contract as defined in
1.16paragraph (b).
1.17(d) "Targeted group business" means a business designated under section 16C.16,
1.18subdivision 5 .
1.19(e) "Veteran-owned small business" means a business designated under section
1.2016C.16, subdivision 6a .
1.21    Subd. 2. Small targeted group business, small business set-asides; contract
1.22preferences. (a) The commissioner may award up to a six percent preference in the
1.23amount bid for specified construction work to small targeted group businesses and
1.24veteran-owned small businesses.
1.25(b) The commissioner may designate a contract for construction work for award only
1.26to small targeted group businesses if the commissioner determines that at least three small
2.1targeted group businesses are likely to bid. The commissioner may designate a contract for
2.2construction work for award only to veteran-owned small businesses if the commissioner
2.3determines that at least three veteran-owned small businesses are likely to bid.
2.4(c) The commissioner, as a condition of awarding a construction contract, may
2.5set goals that require the prime contractor to subcontract a portion of the contract to
2.6small targeted group businesses and veteran-owned small businesses. The commissioner
2.7must establish a procedure for granting waivers from the subcontracting requirement
2.8when qualified small targeted group businesses and veteran-owned small businesses
2.9are not reasonably available. The commissioner may establish financial incentives for
2.10prime contractors who exceed the goals for use of subcontractors and financial penalties
2.11for prime contractors who fail to meet goals under this paragraph. The subcontracting
2.12requirements of this paragraph do not apply to prime contractors who are small targeted
2.13group businesses or veteran-owned small businesses.
2.14(d) (c) The commissioner may award up to a four percent preference in the amount
2.15bid on procurement for specified construction work to small businesses located in an
2.16economically disadvantaged area as defined in section 16C.16, subdivision 7.
2.17    Subd. 2a. Small targeted group business; subcontracting goals. (a) The
2.18commissioner, as a condition of awarding a construction contract, may set goals that
2.19require the prime contractor to subcontract portions of the contract to small targeted
2.20group businesses. Prime contractors must demonstrate good faith efforts to meet the
2.21project goals. The commissioner shall establish a procedure for granting waivers from
2.22the subcontracting requirement when qualified small targeted group businesses are not
2.23reasonably available. The commissioner may establish (1) financial incentives for prime
2.24contractors who exceed the goals set for the use of subcontractors under this subdivision;
2.25and (2) sanctions for prime contractors who fail to make good faith efforts to meet the
2.26goals set under this subdivision.
2.27(b) The small targeted group business subcontracting requirements of this
2.28subdivision do not apply to prime contractors who are small targeted group businesses.
2.29    Subd. 2b. Veteran-owned small business; contract preferences. (a) The
2.30commissioner may award up to a six percent preference in the amount bid for specified
2.31construction work to veteran-owned small businesses, except when prohibited by the
2.32federal government as a condition of receiving federal funds. When a bid preference is
2.33provided under this subdivision, the percentage of preference in bid amount may not be
2.34less than the percentage of bid preference provided to any small targeted group business
2.35under subdivision 2.
3.1(b) When a bid preference is provided under this subdivision, the commissioner
3.2must be as inclusive as possible in specifying contracts for construction work, as well
3.3as for construction-related professional and technical services, available under this bid
3.4preference program for veteran-owned small businesses. The term "construction" must be
3.5given broad meaning for purposes of specifying and letting contracts for veteran-owned
3.6small businesses and must include, but is not limited to, preplanning, planning, and all
3.7other construction-related professional and technical services.
3.8(c) When a bid preference is provided under this subdivision, the commissioner
3.9must strive to ensure that contracts will be awarded on a proportional basis with contracts
3.10awarded under subdivision 2.
3.11(d) The commissioner may designate a contract for construction work for award
3.12only to veteran-owned small businesses, if the commissioner determines that at least three
3.13veteran-owned small businesses are likely to bid.
3.14    Subd. 2c. Veteran-owned small business; subcontracting goals. (a) The
3.15commissioner, as a condition of awarding a construction contract, may set goals that
3.16require the prime contractor to subcontract portions of the contract to veteran-owned small
3.17businesses, except when prohibited by federal law or rule as a condition of receiving
3.18federal funds. Prime contractors must demonstrate good faith efforts to meet the project
3.19goals. The commissioner shall establish a procedure for granting waivers from the
3.20subcontracting requirement when qualified veteran-owned small businesses are not
3.21reasonably available. The commissioner may establish (1) financial incentives for prime
3.22contractors who exceed the goals set for the use of subcontractors under this subdivision;
3.23and (2) sanctions for prime contractors who have not been granted a waiver and fail
3.24to meet goals set under this subdivision.
3.25(b) The subcontracting requirements of this subdivision do not apply to prime
3.26contractors who are veteran-owned small businesses.
3.27    Subd. 3. Small targeted group business subcontract awards to small businesses.
3.28At least 75 percent of subcontracts awarded to small targeted group businesses must be
3.29performed by the business to which the subcontract is awarded or another small targeted
3.30group business.
3.31    Subd. 3a. Veteran-owned small business; subcontract awards. At least 75
3.32percent of subcontracts awarded to veteran-owned small businesses must be performed by
3.33the business to which the subcontract is awarded or another veteran-owned small business.
3.34    Subd. 4. Contract awards, limitations. Contracts awarded pursuant to this
3.35section are subject to all limitations contained in rules adopted by the commissioner
3.36of administration.
4.1    Subd. 4a. Small targeted group business; limited duration and reevaluation.
4.2The commissioner shall cooperate with the commissioner of administration to periodically
4.3reevaluate the targeted group businesses to determine whether there is a statistical disparity
4.4between the percentage of construction contracts awarded to businesses owned by targeted
4.5group members and the representation of businesses owned by targeted group members
4.6among all businesses in the state in the construction category. The commissioner of
4.7administration shall designate targeted groups pursuant to section 16C.16, subdivision 5.
4.8    Subd. 5. Recourse to other businesses. If the commissioner is unable to award
4.9a contract pursuant to the provisions of subdivisions 2 and 3 to 4a, the award may be
4.10placed pursuant to the normal solicitation and award provisions set forth in this chapter
4.11and chapter 16C.
4.12    Subd. 6. Rules; eligibility. (a) The rules adopted by the commissioner of
4.13administration to define small businesses and to set time and other eligibility requirements
4.14for participation in programs under sections 16C.16 to 16C.19 apply to this section. The
4.15commissioner may promulgate other rules necessary to carry out this section.
4.16(b) In addition to other eligibility requirements, a small targeted group business or
4.17veteran-owned small business is eligible for the bid preferences under this section only for
4.18eight years following the latest of:
4.19(1) the effective date of this section;
4.20(2) for a targeted group business, the date of initial certification by the commissioner
4.21of administration, as provided under section 16C.19;
4.22(3) for a veteran-owned small business, the date of initial certification by the United
4.23States Department of Veterans Affairs, as provided under section 16C.19, paragraph (d); or
4.24(4) for a veteran-owned small business, the release or discharge of any one of the
4.25owners from military active service, as defined in section 190.05, subdivision 5, lasting for
4.26a period of 179 days or longer.
4.27    Subd. 7. Noncompetitive bids. The commissioner is encouraged to purchase
4.28from small targeted group businesses and veteran-owned small businesses designated
4.29under section 16C.16 when making purchases that are not subject to competitive bidding
4.30procedures.
4.31    Subd. 8. Report by commissioner Reporting. (a) The commissioner of
4.32transportation shall report to the commissioner of administration on compliance with this
4.33section. The information must be reported at the time and in the manner requested by the
4.34commissioner of administration.
4.35(b) By February 1 of each even-numbered year, the commissioner of transportation
4.36shall submit a report to the chairs and ranking minority members of the legislative
5.1committees with jurisdiction over transportation policy and finance and veterans policy
5.2and finance concerning contract awards during the preceding biennium under this section.
5.3At a minimum, the report must include:
5.4(1) a summary of the program;
5.5(2) a review of the use of preferences for contracting during the preceding biennium,
5.6including frequency of establishment of a preference and frequency and amount of
5.7contract awards to:
5.8(i) small targeted group businesses; and
5.9(ii) veteran-owned small businesses;
5.10(3) a review of goals and good faith efforts to use small targeted group businesses
5.11and veteran-owned small businesses in subcontracts, including analysis of methods used
5.12for, and effectiveness of, good faith efforts;
5.13(4) a summary of any financial incentives used or sanctions imposed;
5.14(5) agency commentary on any perceived impediments, whether statutory,
5.15administrative, or otherwise, that may be limiting the participation of small targeted
5.16group businesses and veteran-owned small businesses in the agency's contract preference
5.17program;
5.18(6) information on each reevaluation under subdivision 4a, including details on the
5.19methodology for reevaluation; and
5.20(7) any recommendations for legislative or programmatic changes.
5.21    Subd. 9. Veteran-owned small business; purpose. The purpose of the state
5.22contracting bid preference program for veteran-owned small businesses is to facilitate
5.23the healthy transition of veterans from military to civilian life, and to help compensate
5.24veterans for their sacrifices including, but not limited to, their sacrifice of health and
5.25time to the state and nation during their military service, as well as to enhance economic
5.26development within Minnesota.
5.27EFFECTIVE DATE.This section is effective the day following final enactment,
5.28and applies to contracts let on or after July 1, 2012.


5.32    Section 1. [375.771] VETERAN-OWNED SMALL BUSINESS CONTRACTS.
5.33    Subdivision 1. Definitions. (a) The definitions in this subdivision apply to this
5.34section.
6.1(b) "Award" means the granting of a contract in accordance with all applicable laws
6.2and rules governing competitive bidding, except as otherwise provided in this section.
6.3(c) "Contract" means an agreement entered into between a business entity and the
6.4county for procurement of goods and services including both technical and nontechnical
6.5goods and services, printing, and construction.
6.6(d) "County board" or "board" has the meaning given in section 375.01.
6.7(e) "County purchasing department" has the meaning given in section 375.72.
6.8(f) "Director of purchasing" has the meaning given in section 375.74.
6.9(g) "Subcontractor" means a business entity that enters into a legally binding
6.10agreement with another business entity that is a party to a contract as defined in paragraph
6.11(c).
6.12(h) "Veteran" has the meaning given in section 197.447.
6.13(i) "Veteran-owned small business" means a business designated under section
6.1416C.16, subdivision 6a.
6.15    Subd. 2. Policy; purpose; director. (a) A county board may establish a program
6.16within the county in accordance with this section to provide a bid preference for
6.17awarding contracts to designated veteran-owned small businesses for the procurement of
6.18technical and nontechnical goods and services including, but not limited to, printing and
6.19construction, broadly defined to include all phases of the construction process.
6.20(b) The purpose of this program is to facilitate the transition of veterans from
6.21military to civilian life, and to help compensate veterans for their sacrifices including, but
6.22not limited to, their sacrifice of health and time to the community, state, and nation during
6.23their military service, as well as to enhance economic development throughout Minnesota.
6.24(c) The county board may direct the county director of purchasing, or other
6.25designated official within the county purchasing department, to administer this program in
6.26accordance with county policy established by the board.
6.27    Subd. 3. Small business set-asides. (a) The county director of purchasing may
6.28award up to a six percent preference in the amount bid for procurement of goods and
6.29services including, but not limited to, technical and nontechnical goods and services,
6.30printing, and construction to veteran-owned small businesses having their principal place
6.31of business in Minnesota.
6.32(b) The board, as a condition of awarding a construction contract, may set goals that
6.33require the prime contractor to subcontract a portion of the contract to veteran-owned
6.34small businesses. The board must establish a procedure for granting waivers from the
6.35subcontracting requirement when qualified veteran-owned small businesses are not
6.36reasonably available. The board may establish financial incentives for prime contractors
7.1who exceed the goals for use of veteran-owned small business subcontractors and
7.2financial penalties for prime contractors who fail to meet goals under this paragraph. The
7.3subcontracting requirements of this paragraph do not apply to prime contractors who are
7.4veteran-owned small businesses.
7.5    Subd. 4. Awards to small businesses. At least 75 percent of subcontracts awarded
7.6to veteran-owned small businesses must be performed by the business to which the
7.7subcontract is awarded or another veteran-owned small business.
7.8    Subd. 5. Awards, limitations. Contracts awarded under this section are subject to
7.9all limitations adopted by the board.
7.10    Subd. 6. Recourse to other businesses. If the director is unable to award a contract
7.11under subdivisions 3 and 4, the award may be placed under normal solicitation and award
7.12statutes and rules.
7.13    Subd. 7. Noncompetitive bids. The board is encouraged to purchase from
7.14veteran-owned small businesses designated under section 16C.16, subdivision 6a, when
7.15making purchases that are not subject to competitive bidding procedures.
7.16    Subd. 8. Report to board. At the request of the county board, the county treasurer
7.17shall report to the board on compliance with this section. The information must be
7.18reported at the time and in the manner requested by the board.
7.19EFFECTIVE DATE.This section is effective July 1, 2012, for contracts awarded
7.20by counties on or after that date."
7.21Renumber the sections in sequence and correct the internal references
7.22Amend the title accordingly