Incomes a Procurement Exemption

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This week, we’re specializing in the Hawaii Tourism Authority (HTA).  They’ve been attempting to award a tourism advertising and marketing contract value tens of thousands and thousands of {dollars}, as they’ve for the previous a number of years.  Up to now, that contract has at all times gone to the Hawai’i Guests and Conference Bureau (HVCB), however this time round, there have been a couple of twists and turns.

Initially, the contract was open for bids, identical to Hawaii state procurement regulation requires. Regardless of aggressive bids put in by different entities, such because the Council for Native Hawaiian Development (CNHA), the contract award went to HVCB as common.  CNHA filed a protest, alleging irregularities with the award process, and HTA determined to do the method over.  On the finish of Spherical Two, HTA awarded the contract to CNHA, and this time it was HVCB‘s flip to file the protest.  Days, if not minutes, earlier than our earlier governor’s time period ended, the top of DBEDT, below which HTA sits, determined to rescind the second procurement.

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At this level, the rating is:  HVCB 1, CNHA1, and taxpayers nil (for these of you who haven’t been following the World Cup, meaning zero). 

These turns of occasions didn’t evade the watchful eyes of the Senate Methods and Means Committee, which held informational briefings on the matter.  At considered one of them, HTA’s chief govt, John De Fries, advised a easy resolution:  Give HTA an exemption from state procurement regulation so it doesn’t should comply with all these burdensome procedures that the regulation requires.

“You’re going to should earn one thing like that,” Senator Donna Mercado Kim, one of many Methods and Means Committee members, was quoted as replying.

That, in fact, brings up a brand new and troubling query: how does an company “earn“ a procurement code exemption?

There are a number of the explanation why we have now a public procurement code.  In keeping with the regulation in 1993 that adopted it, a few of the causes are:  (1) making certain the honest and equitable therapy of all individuals from whom our authorities buys items or providers; (2) fostering public confidence within the integrity of the procurement course of; and (3) encouraging broad-based competitors. 

Clearly, it’s powerful to have public confidence within the integrity of the procurement course of when the method solely applies a few of the time.

Underneath present regulation, there are only some businesses explicitly exempt from the procurement code:  the regional system board of the Hawaii Well being Methods Company (HHSC), which runs the state hospitals.  That’s in HRS part 103D-102(c).  This exemption was enacted in 2007, as Act 290 for that 12 months.  The exemption appears to have originated with the Senate Committee on Well being that 12 months, in line with a report from that committee, which on the time was chaired by one Senator David Ige.  That committee’s draft of the invoice included each an exemption from the state procurement code and an exemption from the tax clearance requirement in order that distributors might take care of and obtain cost from HHSC whether or not or not they had been in compliance with tax legal guidelines.  It’s unclear from the invoice drafts and committee stories how HHSC merited, or earned, an exemption from these legal guidelines.

Possibly sooner or later lawmakers can clarify to us how an company can earn an exemption from the Procurement Code, or maybe make clear that they misspoke.  For now, nevertheless, we will relaxation assured that the concept doesn’t appear to be going anyplace this time.

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