If You Contract with the State, Be Aware of Illinois Procurement Code Changes
- Todd M. Turner

If you do business with the State, you may be affected by recent changes to the Illinois Procurement Code. Here are some highlights: 1. P.A. 93-0077 provides that if a State contractor fails to perform as required by a contract, or there is a violation of the Procurement Code, new law gives the State the right to suspend the contractor from State contracts for a period of up to ten years. Previously, the maximum was five years. 2. P.A. 93-0656 creates the Public Works Contract Change Order Act. This Act applies to units of local government and school district construction work that is not let under the Procurement Code. The Act requires that change orders in excess of 50% of the initial bid must be resubmitted for further bidding. 3. P.A. 93-0642 amends the Procurement Code to require that for construction projects, a “responsible bidder” must: (a) comply with all applicable laws concerning the bidder's entitlement to conduct business in Illinois, (b) comply with all applicable provisions of the Prevailing Wage Act, (c) comply with the "Equal Employment Opportunities" Act of the United States Code, (d) have a valid Federal Employer Identification Number or, if an individual, a valid Social Security Number, (e) have a valid certificate of insurance showing the following coverages: general liability, professional liability, product liability, workers' compensation, completed operations, hazardous occupation, and automobile, and (f) along with the bidder's subcontractors, participate in applicable apprenticeship and training programs approved by and registered with the United States Department of Labor's Bureau of Apprenticeship and Training. The General Assembly also adopted the Governor’s amendatory veto adding: “The provisions of this Section shall not apply to federally funded construction projects if such application would jeopardize the receipt or use of federal funds in support of such a project.” 4. P.A. 93-0025 amends the Procurement Code to add that “affiliates” of delinquent vendors cannot do business within this State. The Code previously prohibited a vendor from entering into a State contract “if that person knows or should know that he or she is delinquent in the payment of any debt to the State, unless the person has entered into a deferred payment plan to pay off the debt.” Now the Code provides that the same is true for an “affiliate” of a delinquent vendor. The term "affiliate" means any entity that directly, indirectly, or constructively controls another entity, or is controlled by another entity, or is subject to the control of a common entity. An entity “controls” or is controlled by another if it owns directly or individually more than 10% of the voting securities of that entity, or if the entity has 10% or more of its voting securities owned by another person or entity. A “voting security” is broadly defined to include LLC and partnership interests. For more information regarding this article, please contact the author or any Sorling attorney who practices business advising law by clicking: Todd M. Turner www.sorlinglaw.com/practice-business.htm Click here to review the Sorling disclaimer: http://www.sorlinglaw.com/About-Disclaimers.htm

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