HB0309

HOUSE BILL 309

50th legislature - STATE OF NEW MEXICO - first session, 2011

INTRODUCED BY

David C. Chavez

AN ACT

RELATING TO GOVERNMENT CONTRACTING; APPLYING PROCUREMENT CODE PROCEDURES TO CERTAIN LEASES OF REAL PROPERTY; PROVIDING FOR A CEILING ON LEASE PAYMENTS; INCREASING THE BID PREFERENCE FOR RESIDENT BUSINESSES; CREATING A BID PREFERENCE FOR NEW MEXICO VETERANS; PROVIDING ADDITIONAL REQUIREMENTS FOR SOLE SOURCE CONTRACTS; PROVIDING FOR ADDITIONAL INFORMATION TO BE POSTED ON THE INTERNET; REQUIRING ANNUAL AUDITS OF CONSTRUCTION CONTRACTS; PROHIBITING PUBLIC MONEY FROM BEING EXPENDED AFTER JUNE 30, 2012 PURSUANT TO A LEASE OR PROCUREMENT CONTRACT, UNLESS THE CONTRACT WAS ENTERED INTO PURSUANT TO LAW ON OR AFTER JULY 1, 2011; PROVIDING FOR TEMPORARY WAIVERS FROM THE PROHIBITION; RECONCILING CONFLICTING AMENDMENTS TO THE SAME SECTION OF LAW IN LAWS 2001 BY REPEALING LAWS 2001, CHAPTER 293, SECTION 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 13-1-21 NMSA 1978 (being Laws 1979, Chapter 72, Section 1, as amended) is amended to read:

"13-1-21. APPLICATION OF PREFERENCES.--

A. For the purposes of this section:

(1) "resident business" means a [New Mexico resident business or a New York state business enterprise;

(2) "New Mexico resident business" means a] business that is authorized to do and is doing business under the laws of this state and that:

(a) [that] maintains its principal place of business in the state;

(b) has staffed an office and has paid applicable state taxes for two years prior to the awarding of the bid and has five or more employees who are residents of the state; or

(c) is an affiliate of a business that meets the requirements of Subparagraph (a) or (b) of this paragraph. As used in this section, "affiliate" means an entity that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with the qualifying business through ownership of voting securities representing a majority of the total voting power of the entity;

[(3) "New York state business enterprise" means a business enterprise, including a sole proprietorship, partnership or corporation, that offers for sale or lease or other form of exchange, goods or commodities that are substantially manufactured, produced or assembled in New York state, or services, other than construction services, that are substantially performed within New York state. For purposes of construction services, a "New York state business enterprise" means a business enterprise, including a sole proprietorship, partnership or corporation, that has its principal place of business in New York state;

(4) "resident manufacturer" means a person who offers materials grown, produced, processed or manufactured wholly in the state; provided, however, that a New York state business enterprise shall be deemed to be a resident manufacturer solely for the purpose of evaluating the New York state business enterprise's bid against the bid of a resident manufacturer that is not a New York state business enterprise;

(5) "recycled content goods" means supplies and materials composed in whole or in part of recycled materials; provided that the recycled materials content meets or exceeds the minimum content standards required by bid specification;

(6) "virgin content goods" means supplies and materials that are wholly composed of nonrecycled materials or do not meet minimum recycled content standards required by bid specification]; and

(2) "resident veteran business" means a resident business, the majority ownership of which is held by New Mexico residents who have been honorably discharged from membership in the armed forces of the United States.

[B. When bids are received only from nonresident businesses and resident businesses and the lowest responsible bid is from a nonresident business, the contract shall be awarded to the resident business whose bid is nearest to the bid price of the otherwise low nonresident business bidder if the bid price of the resident bidder is made lower than the bid price of the nonresident business when multiplied by a factor of .95.

C. When bids are received only from nonresident businesses and resident manufacturers and the lowest responsible bid is from a nonresident business, the contract shall be awarded to the resident manufacturer whose bid is nearest to the bid price of the otherwise low nonresident business bidder if the bid price of the resident manufacturer is made lower than the bid price of the nonresident business when multiplied by a factor of .95.

D. When bids are received only from resident businesses and resident manufacturers and the lowest responsible bid is from a resident business, the contract shall be awarded to the resident manufacturer whose bid is nearest to the bid price of the otherwise low resident business bidder if the bid price of the resident manufacturer is made lower than the bid price of the resident business when multiplied by a factor of .95.

E. When bids are received from resident manufacturers, resident businesses and nonresident businesses and the lowest responsible bid is from a resident business, the contract shall be awarded to the resident manufacturer whose bid is nearest to the bid price of the otherwise low resident business bidder if the bid price of the resident manufacturer is made lower than the bid price of the resident business when multiplied by a factor of .95.

F. When bids are received from resident manufacturers, resident businesses and nonresident businesses and the lowest responsible bid is from a nonresident business, the contract shall be awarded to the resident manufacturer whose bid is nearest to the bid price of the otherwise low nonresident business bidder if the bid price of the resident manufacturer is evaluated as lower than the bid price of the nonresident business when multiplied by a factor of .95. If there is no resident manufacturer eligible for award under this provision, then the contract shall be awarded to the resident business whose bid is nearest to the bid price of the otherwise low nonresident business bidder if the bid price of the resident business is made lower than the bid price of the nonresident business when multiplied by a factor of .95.

G. When bids are received for virgin content goods only or for recycled content goods only, Subsections B through F of this section shall apply.

H. When bids are received for both recycled content goods and virgin content goods and the lowest responsible bid is for virgin content goods, the contract shall be awarded to:

(1) a resident manufacturer offering the lowest bid on recycled content goods of equal quality if the bid price of the resident manufacturer when multiplied by a factor of .90 is made lower than the otherwise low virgin content goods bid price;

(2) a resident business offering a bid on recycled content goods of equal quality if:

(a) the bid price of no resident manufacturer following application of the preference allowed in Paragraph (1) of this subsection can be made sufficiently low; and

(b) the lowest bid price of the resident business when multiplied by a factor of .90 is made lower than the otherwise low virgin content goods bid price; or

(3) a nonresident business or nonresident manufacturer offering recycled content goods of equal quality if:

(a) the bid price of no resident business or resident manufacturer following application of the preference allowed in Paragraph (1) or (2) of this subsection can be made sufficiently low; and

(b) the lowest bid price of a nonresident offering recycled content goods when multiplied by a factor of .95 is made lower than the otherwise low virgin content bid price.

I. When bids are received for both recycled content goods and virgin content goods and the lowest responsible bid is for recycled content goods offered by a nonresident business or nonresident manufacturer, the contract shall be awarded to:

(1) a resident manufacturer offering the lowest bid on recycled content goods of equal quality if the bid price of the resident manufacturer when multiplied by a factor of .95 is made lower than the otherwise low recycled content goods bid price; or

(2) a resident business offering a bid on recycled content goods of equal quality if:

(a) the bid price of no resident manufacturer following application of the preference allowed in Paragraph (1) of this subsection can be made sufficiently low; and

(b) the lowest bid price of the resident business when multiplied by a factor of .95 is made lower than the otherwise low recycled content goods bid price offered by a nonresident business or manufacturer.

J. When bids are received for both recycled content goods and virgin content goods and the lowest responsible bid is for recycled content goods offered by a resident business, the contract shall be awarded to a resident manufacturer offering the lowest bid on recycled content goods of equal quality if the bid price of the resident manufacturer when multiplied by a factor of .95 is made lower than the otherwise low recycled content goods bid price.]

B. When bids are received pursuant to an invitation for bids, each bid price submitted by a bidder that is not a resident business shall be multiplied by 1.0, each bid price submitted by a resident business that is not a resident veteran business shall be multiplied by 0.9 and each bid price submitted by a resident veteran business shall be multiplied by 0.85. After the multiplications, the contract shall be awarded to the bidder whose bid price yields the lowest result.

[K.] C. This section shall not apply when the expenditure of federal funds designated for a specific purchase is involved or for any bid price greater than five million dollars ($5,000,000).

[L. The provisions of this section shall not apply to the purchase of buses from a resident manufacturer or a New Mexico resident business that manufactures buses in New Mexico. It is the purpose of this subsection to:

(1) allow any bus manufacturer or business that manufactures buses to compete openly for public procurement contracts in New Mexico without giving preference to a business based on the location of the place of manufacture of the buses;

(2) give resident manufacturers and New Mexico resident businesses that manufacture buses an equal opportunity to sell their buses in states that have reciprocal preference laws; and

(3) eliminate all different treatment of any kind under New Mexico law and by all political jurisdictions in the state between New Mexico resident businesses and manufacturers that manufacture buses and businesses in other states that manufacture and sell buses.]"

SECTION 2. Section 13-1-22 NMSA 1978 (being Laws 1969, Chapter 184, Section 1, as amended) is amended to read:

"13-1-22. RESIDENT BUSINESS AND [MANUFACTURER] RESIDENT VETERAN BUSINESS CERTIFICATION--APPLICATION--INFORMATION.--No resident business or resident [manufacturer] veteran business, as those terms are defined in Subsection A of Section 13-1-21 NMSA 1978, shall be given any preference in the awarding of contracts for furnishing materials or services to a state agency unless the resident business or resident [manufacturer shall have] veteran business has qualified with the state purchasing agent as a resident business or resident [manufacturer or both] veteran business by making application to the state purchasing agent and receiving [from him] a certification number. The procedure for application and certification shall be as follows:

A. the state purchasing agent shall prepare an application form for certification as a resident business or [manufacturer] resident veteran business, requesting such information and proof as [he deems] necessary to qualify the applicant under the terms of Section 13-1-21 NMSA 1978;

B. the resident business or resident [manufacturer] veteran business shall complete the application form and submit it to the state purchasing agent prior to the awarding of any contract in which the resident business or [manufacturer] resident veteran business desires to be given a preference; and

C. the state purchasing agent shall examine the application and if necessary may seek additional information or proof to [assure himself] ensure that the prospective business [or manufacturer] is indeed entitled to the statutory preference. If all is in order, [he] the state purchasing agent shall issue the [supplier] business a distinctive certification number [which] that shall be valid until revoked and [which], when used on bids and other purchasing documents, shall entitle the business [or manufacturer] to the statutory preference."

SECTION 3. Section 13-1-97.1 NMSA 1978 (being Laws 2009, Chapter 107, Section 1) is amended to read:

"13-1-97.1. CONTRACT DATABASE.--

A. The department of finance and administration, the department of information technology, the department of transportation and the general services department shall jointly develop a database of all state contracts with a term beginning on or after January 1, 2010 and having a value of more than twenty thousand dollars ($20,000) entered into pursuant to the Procurement Code or otherwise within the purview of any state agency. The general services department shall coordinate the maintenance of the database with the assistance of the other departments.

B. The database shall also contain:

(1) all outstanding invitations to bid and requests for proposals issued by a state agency;

(2) each award made by a state agency in response to a competitive sealed bid or competitive sealed proposal;

(3) each sole source contract entered into by a state agency pursuant to Section 13-1-126 NMSA 1978 and the justification for the sole source;

(4) the records for sole source and emergency procurements required by Section 13-1-128 NMSA 1978 for a state agency; and

(5) the results of the annual audits of construction contracts required by Section 13-1-161.1 NMSA 1978.

[B.] C. The general services department shall make the database available to the public on its online web site no later than January 1, 2010. The database shall be searchable by contractor name, subject matter, date, price or consideration, contract number, amendments and other categories of information that the departments identified in Subsection A of this section agree are necessary to inform the public fully about state contracts."

SECTION 4. Section 13-1-104 NMSA 1978 (being Laws 1984, Chapter 65, Section 77, as amended) is amended to read:

"13-1-104. COMPETITIVE SEALED BIDS--PUBLIC NOTICE.--

A. An invitation for bids or a notice thereof shall be published not less than ten calendar days prior to the date set forth for the opening of bids. In the case of purchases made by the state purchasing agent or another state agency, the invitation or notice shall be published at least once in at least three newspapers of general circulation in this state; in addition, an invitation or notice [may] shall be published electronically on the state purchasing agent's web site that is maintained for that purpose and on the contract database web site maintained pursuant to Section 13-1-97.1 NMSA 1978. In the case of purchases made by [other central purchasing offices] local public bodies, the invitation or notice shall be published at least once in a newspaper of general circulation in the area in which the [central purchasing office] local public body is located, and shall be published electronically on the web site of the local public body if the local public body maintains such a web site. These requirements of publication are in addition to any other procedures that may be adopted by central purchasing offices to notify prospective bidders that bids will be received, including publication in a trade journal, if available. If there is no newspaper of general circulation in the area in which the central purchasing office is located, such other notice may be given as is commercially reasonable.

B. Central purchasing offices shall send copies of the notice or invitation for bids involving the expenditure of more than twenty thousand dollars ($20,000) to those businesses that have signified in writing an interest in submitting bids for particular categories of items of tangible personal property, construction and services and that have paid any required fees. A central purchasing office may set different registration fees for different categories of services, construction or items of tangible personal property, but such fees shall be related to the actual, direct cost of furnishing copies of the notice or invitation for bids to the prospective bidders. The fees shall be used exclusively for the purpose of furnishing copies of the notice or invitation for bids of proposed procurements to prospective bidders.

C. A central purchasing office may satisfy the requirement of sending copies of a notice or invitation for bids by distributing the documents to prospective bidders through electronic media. Central purchasing offices shall not require that prospective bidders receive a notice or invitation for bids through electronic media.

D. As used in this section, "prospective bidders" includes persons considering submission of a bid as a general contractor for the construction contract and persons who may submit bids to a general contractor for work to be subcontracted pursuant to the construction contract. Central purchasing offices shall make copies of invitations for bids for construction contracts available to prospective bidders. A central purchasing office may require prospective bidders who have requested documents for bid on a construction contract to pay a deposit for a copy of the documents for bid. The deposit shall equal the full cost of reproduction and delivery of the documents for bid. The deposit, less delivery charges, shall be refunded if the documents for bid are returned in usable condition within the time limits specified in the documents for bid, which time limits shall be no less than ten calendar days from the date of the bid opening. All forfeited deposits shall be credited to the funds of the applicable central purchasing office."

SECTION 5. Section 13-1-108 NMSA 1978 (being Laws 1984, Chapter 65, Section 81, as amended) is amended to read:

"13-1-108. COMPETITIVE SEALED BIDS--AWARD.--A contract solicited by competitive sealed bids shall be awarded with reasonable promptness by written notice to the lowest responsible bidder. Also, after written notice to the lowest responsible bidder, notice of the award shall be posted on the contract database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the award is made by a state agency, or on the web site of the local public body, if the award is made by a local public body and if the local public body maintains such a web site. Contracts solicited by competitive sealed bids shall require that the bid amount exclude the applicable state gross receipts tax or applicable local option tax but that the contracting agency shall be required to pay the applicable tax, including any increase in the applicable tax becoming effective after the date the contract is entered into. The applicable gross receipts tax or applicable local option tax shall be shown as a separate amount on each billing or request for payment made under the contract."

SECTION 6. Section 13-1-117 NMSA 1978 (being Laws 1984, Chapter 65, Section 90, as amended) is amended to read:

"13-1-117. COMPETITIVE SEALED PROPOSALS--AWARD.--The award shall be made to the responsible offeror [or offerors] whose proposal is most advantageous to the state agency or a local public body, taking into consideration the evaluation factors set forth in the request for proposals. Notice of the award shall be posted on the contract database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the award is made by a state agency, or on the web site of the local public body, if the award is made by a local public body and if the local public body maintains such a web site."

SECTION 7. Section 13-1-126 NMSA 1978 (being Laws 1984, Chapter 65, Section 99, as amended) is amended to read:

"13-1-126. SOLE SOURCE PROCUREMENT.--

A. A contract may be awarded without competitive sealed bids or competitive sealed proposals regardless of the estimated cost [when] if:

(1) the state purchasing agent or a central purchasing office makes a determination, after conducting a good-faith review of available sources and consulting the using agency, that there is only one source for the required service, construction or item of tangible personal property; and

(2) the contract and the sole source justification are approved by:

(a) the governor if the contract is to be awarded by a state agency under the control of the governor; or

(b) the administrative head of the state agency or local public body if the contract is to be awarded by a local public body or a state agency not under the control of the governor.

B. The state purchasing agent or a central purchasing office shall conduct negotiations, as appropriate, as to price, delivery and quantity in order to obtain the price most advantageous to the state agency or a local public body. C. A contract for the purchase of research consultant services by institutions of higher learning constitutes a sole source procurement.

D. When a contract is awarded pursuant to this section, the fact that the contract was sole source and the justification for the sole source shall be posted:

(1) on the database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the contract is awarded by a state agency; or

(2) on the web site maintained by the local public body, if the contract is awarded by a local public body and the local public body maintains such a web site."

SECTION 8. Section 13-1-128 NMSA 1978 (being Laws 1984, Chapter 65, Section 101, as amended) is amended to read:

"13-1-128. SOLE SOURCE AND EMERGENCY PROCUREMENTS--CONTENT AND SUBMISSION OF RECORD.--

A. All central purchasing offices shall maintain, for a minimum of three years, records of sole source and emergency procurements. The record of each such procurement shall be public record and shall contain:

[A.] (1) the contractor's name and address;

[B.] (2) the amount and term of the contract;

[C.] (3) a listing of the services, construction or items of tangible personal property procured under the contract; and

[D.] (4) the justification for the procurement method.

B. The record required by Subsection A of this section shall also be posted:

(1) on the database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the contract is awarded by a state agency; or

(2) on the web site maintained by the local public body, if the contract is awarded by a local public body and the local public body maintains such a web site."

SECTION 9. A new section of the Procurement Code, Section 13-1-161.1 NMSA 1978, is enacted to read:

"13-1-161.1. [NEW MATERIAL] ANNUAL AUDIT OF CONSTRUCTION CONTRACTS.--

A. During the term of the contract and for one year thereafter, the department of finance and administration shall annually audit or cause to be audited each contract for construction entered into pursuant to the Procurement Code with a value of five million dollars ($5,000,000) or more.

B. The annual audit shall determine:

(1) whether the contract specifications are being followed;

(2) whether the procedures used in awarding the contract were consistent with law;

(3) whether the contractor and subcontractors are adequately performing the required work;

(4) for completed projects, whether the contractor and subcontractors completed the project within the required time frame;

(5) whether the state agency or local public body adequately administered the contract; and

(6) whether the state agency or local public body correctly recaptured contract funds from cost overruns and related penalties incurred by the contractor or subcontractor.

C. The results of an audit conducted pursuant to this section:

(1) shall be posted on the contract database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the using agency is a state agency; or

(2) shall be posted on the web site of the local public body, if the using agency is a local public body and if the local public body maintains such a web site."

SECTION 10. A new Section 13-1-200 NMSA 1978 is enacted to read:

"13-1-200. [NEW MATERIAL] REAL PROPERTY LEASES--REQUIREMENTS--DETERMINATION BY PROPERTY CONTROL DIVISION.--

A. No public entity shall enter into a contract to lease real property from a private person without complying with the provisions of this section, and any such contract entered into without substantial compliance with the requirements of this section, shall be void and unenforceable.

B. The following provisions of the Procurement Code shall govern the procedures for entering into a contract for the lease of real property between a public entity, as lessee, and a private person, as lessor:

(1) Sections 13-1-111 through 13-1-117 NMSA 1978 concerning competitive sealed proposals and the posting of requests for proposals and notice of awards on appropriate web sites;

(2) Section 13-1-126 NMSA 1978 for sole source contracts; and

(3) Section 13-1-128 NMSA 1978 for recordkeeping requirements for sole source contracts and the posting of the records on appropriate web sites.

C. Before entering into a contract for the lease of real property from a private person, the public entity shall submit the proposed contract to the property control division of the general services department. The division shall review the proposed contract and determine if the lease price to be paid under the contract is less than one hundred twenty-five percent of the average price being paid for leasing similar real estate under similar terms in the same area of the state. No contract shall be finalized if the division determines that the lease price is equal to or more than one hundred twenty-five percent of the average price. The division shall maintain a database of prices paid to lease real property throughout the state.

D. Upon notice by the property control division that the lease price in the proposed contract is equal to or more than one hundred twenty-five percent of the average price, the public entity:

(1) shall attempt to negotiate a lease price with the proposed lessor that is less than one hundred twenty-five percent of the average price;

(2) if unable to negotiate a lease price pursuant to Paragraph (1) of this subsection, shall attempt to negotiate a lease price with other responsible offerors that is less than one hundred twenty-five percent of the average price; and

(3) if unable to negotiate a lease price pursuant to Paragraph (2) of this subsection or if there are no other responsible offerors, shall cancel the process and issue another request for proposals pursuant to the requirements of this section.

E. No lease of real property by a public entity from a private person shall exceed a term of twenty years.

F. The provisions of this section are not applicable to a lease purchase agreement under which the public entity receives an option to purchase for a price that is reduced according to the payments made pursuant to the agreement.

G. As used in this section, "public entity" means the state or any of its officers, branches, agencies, institutions, instrumentalities or political subdivisions."

SECTION 11. Section 13-4-2 NMSA 1978 (being Laws 1984, Chapter 66, Section 2, as amended) is amended to read:

"13-4-2. RESIDENT CONTRACTOR DEFINED--APPLICATION OF PREFERENCE.--

[A. "Resident contractor" means a New Mexico resident contractor or a New York state business enterprise.

B. "New Mexico]

A. As used in this section:

(1) "resident contractor" means any person, firm, corporation or other legal entity if, at the time the contract is advertised for bids and at the time bids are opened, it has all required licenses and meets the following requirements:

[(1)] (a) if the bidder is a corporation, it shall be incorporated in New Mexico and maintain its principal office and place of business in New Mexico;

[(2)] (b) if the bidder is a partnership, general or limited, or other legal entity, it shall maintain its principal office and place of business in New Mexico;

[(3)] (c) if the bidder is an individual, [he] the person shall maintain [his] the principal office and place of the business in New Mexico; or

[(4)] (d) if a bidder who is a telecommunications company as defined by Subsection M of Section 63-9A-3 NMSA 1978 or an affiliate of a telecommunications company has paid unemployment compensation to the [employment security division of the labor] workforce transition services division of the workforce solutions department at the applicable experience rate for that employer pursuant to the Unemployment Compensation Law on no fewer than ten employees who have performed services subject to contributions for the two-year period prior to issuance of notice to bid, the bidder will be considered to have fulfilled the requirements of [Paragraph (1), (2) or (3) of this subsection] Subparagraph (a), (b) or (c) of this paragraph. A successor to a previously qualified [New Mexico contractor or] resident contractor, where the creation of the bidder resulted from a court order, is entitled to credit for qualifying contributions paid by the previously qualified [New Mexico contractor or] resident contractor;

[C. "New York state business enterprise" means a business enterprise, including a sole proprietorship, partnership or corporation, that offers for sale or lease or other form of exchange, goods or commodities that are substantially manufactured, produced or assembled in New York state, or services, other than construction services, that are substantially performed within New York state. For purposes of construction services, a New York state business enterprise means a business enterprise, including a sole proprietorship, partnership or corporation, that has its principal place of business in New York state.

D. For purposes of this section]

(2) "affiliate" means an entity that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with a telecommunications company through ownership of voting securities representing a majority of the total voting power of that entity; and

[E. When bids are received only from nonresident contractors and resident contractors and the lowest responsible bid is from a nonresident contractor, the contract shall be awarded to the resident contractor whose bid is nearest to the bid price of the otherwise low nonresident contractor if the bid price of the resident contractor is made lower than the bid price of the nonresident contractor when multiplied by a factor of .95]

(3) "resident veteran contractor" means a resident contractor, the majority ownership of which is held by New Mexico residents who have been honorably discharged from membership in the armed forces of the United States.

B. When bids are received, each bid price submitted by a bidder that is not a resident contractor shall be multiplied by 1.0, each bid price submitted by a resident contractor that is not a resident veteran contractor shall be multiplied by 0.9 and each bid price submitted by a resident veteran contractor shall be multiplied by 0.85. After the multiplications, the contract shall be awarded to the bidder whose bid price yields the lowest result.

[F.] C. No contractor shall be treated as a resident contractor or a resident veteran contractor in the awarding of public works contracts by a state agency or a local public body unless the contractor has qualified with the state purchasing agent as a resident contractor or a resident veteran contractor pursuant to this section by making application to the state purchasing agent and receiving from [him] the state purchasing agent a certification number. The procedure for application and certification is as follows:

(1) the state purchasing agent shall prepare an application form for certification as a resident contractor or a resident veteran contractor, requiring such information and proof as [he deems] necessary to qualify the applicant under the terms of this section;

(2) the contractor seeking to qualify as a resident contractor or a resident veteran contractor shall complete the application form and submit it to the state purchasing agent prior to the submission of a bid on which the contractor desires to be given a preference;

(3) the state purchasing agent shall examine the application and if necessary may seek additional information or proof so as to be assured that the prospective contractor is indeed entitled to certification as a resident contractor or a resident veteran contractor. If the application is in proper form, the state purchasing agent shall issue the contractor a distinctive certification number [which] that is valid until revoked and [which] when used on bids and other purchasing documents for state agencies or local public bodies, entitles the contractor to treatment as a resident contractor or a resident veteran contractor under Subsection [E] B of this section; and

(4) the certification number issued pursuant to Paragraph (3) of this subsection shall be revoked by the state purchasing agent upon making a determination that the contractor no longer meets the requirements of a resident contractor or a resident veteran contractor as defined in this section."

SECTION 12. Section 15-3B-4 NMSA 1978 (being Laws 1978, Chapter 166, Section 14, as amended by Laws 2001, Chapter 293, Section 1 and by Laws 2001, Chapter 319, Section 4) is amended to read:

"15-3B-4. DIVISION--DUTIES--FEDERAL FUNDS.--

A. The division shall:

(1) assign the use or occupancy of state buildings and lands under its jurisdiction to the state agency or political subdivision that may make the best and highest beneficial use of the property;

(2) regulate the use or occupancy of buildings and real property under its jurisdiction and make reasonable requirements for the continuation of that use or occupancy;

(3) establish space standards for buildings under its jurisdiction;

(4) have custody of all maps, deeds, plats, plans, specifications, contracts, books and other papers connected with state buildings under its jurisdiction;

(5) secure copies of all documents of title to all real property under its jurisdiction held in the name of the state or for the use of the state, and index those documents so that the status of real property held by the state under its jurisdiction can be readily ascertained;

(6) control the lease or rental of space in private buildings by state executive agencies other than the state land office, including inspection for code compliance and life and safety issues. The director may act as lessee on behalf of a state agency if the division determines it is in the best interest of the state and if the lease is entered into pursuant to the provisions of Section 13-1-200 NMSA 1978;

(7) make rules for the conduct of all persons in and about buildings and grounds under its jurisdiction necessary and proper for the safety, care and preservation of the buildings and grounds and for the safety and convenience of the persons while they are in and about the buildings and grounds;

(8) have the power to sell state buildings and real property under its jurisdiction in accordance with Sections 13-6-2 and 13-6-3 NMSA 1978. Any such sale shall be by quitclaim deed;

(9) have the power to purchase title insurance or a title opinion in conjunction with the sale of state buildings or land;

(10) have the power to enter into contracts for the improvement, alteration and reconstruction of the state buildings under its jurisdiction, including the governor's residence, and for the design and construction of additional buildings, to the extent funds are available;

(11) develop long-range programs for the continuing preservation and repair of buildings and improvements and for beautification of grounds and premises under its jurisdiction;

(12) conduct continuing review and analysis of requirements for additional structures and facilities to house state agencies;

(13) ensure that on-site inspections of capital projects are conducted to verify that construction specifications are being met; [and]

(14) maintain a database of lease prices for real estate throughout the state as required by Subsection C of Section 13-1-200 NMSA 1978 and review proposed leases to make the determinations required by that subsection; and

[(14)] (15) receive gifts, grants and donations from the federal government or other sources for the public buildings repair fund.

B. The provisions of this section are subject to federal law or rules if the buildings or property [was] were purchased with federal funds.

C. The division and a state agency or institution that controls property exempt from the jurisdiction of the division may enter into a joint powers agreement pursuant to the Joint Powers Agreements Act giving the division the power to exercise control of the property as specified in the agreement."

SECTION 13. TEMPORARY PROVISION--PROHIBITING EXPENDITURES UNDER EXISTING LEASES--PROVIDING FOR TEMPORARY WAIVERS.--

A. Unless a temporary waiver has been granted pursuant to Subsection C of this section, and if allowed under the lease contract, as soon as feasible after July 1, 2011, each public entity with an existing lease contract for the lease of real property from a private person shall terminate the lease contract. If necessary, the public entity may enter into a subsequent lease contract pursuant to the provisions of Section 13-1-200 NMSA 1978.

B. Except for temporary waivers allowed pursuant to Subsection C of this section, on or after July 1, 2012, no public entity shall expend public money for the lease of real property from a private person unless the lease is entered into pursuant to the provisions of Section 13-1-200 NMSA 1978. During fiscal year 2012, each public entity with an existing lease contract for the lease of real property from a private person that was entered into prior to July 1, 2011 and not terminated pursuant to Subsection A of this section shall notify the lessor of the requirements of this subsection and that the lease will be terminated no later than July 1, 2012 but that another lease may be entered into pursuant to Section 13-1-200 NMSA 1978.

C. For good cause, the governor, if the lease is held by a public entity under the control of the governor, or the administrative head of a public entity, if the lease is held by a public entity not under the control of the governor, may grant a temporary waiver from a requirement of Subsection A or B of this section if:

(1) the requirement is waived for a period of one hundred eighty days or less; and

(2) the waiver and the justification for the waiver is posted:

(a) on the database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the public entity is a state agency; or

(b) on the web site maintained by the public entity, if the public entity is not a state agency and if the public entity maintains such a web site.

D. As used in this section, "public entity" means the state or any of its officers, branches, agencies, institutions, instrumentalities or political subdivisions.

SECTION 14. TEMPORARY PROVISION--PROHIBITING EXPENDITURES UNDER EXISTING PROCUREMENT CONTRACTS--PROVIDING FOR TEMPORARY WAIVERS.--

A. Unless a temporary waiver has been granted pursuant to Subsection C of this section, as soon as feasible after July 1, 2011, and if allowed under the procurement contract, each public entity with an existing contract for the procurement of items of tangible personal property, services or construction shall terminate the contract. If necessary, the public entity may enter into a subsequent contract pursuant to the provisions of the Procurement Code.

B. Except for temporary waivers allowed pursuant to Subsection C of this section, on or after July 1, 2012, no public entity shall expend public money for the procurement of items of tangible personal property, services or construction unless the procurement contract is entered into pursuant to the provisions of the Procurement Code after July 1, 2011. During fiscal year 2012, each public entity with an existing procurement contract for the procurement of items of tangible personal property, services or construction that was entered into prior to July 1, 2011 and not terminated pursuant to Subsection A of this section shall notify the contractor of the requirements of this subsection and that the contract will be terminated no later than July 1, 2012 but that another contract may be entered into pursuant to the Procurement Code on or after July 1, 2011.

C. For good cause, the governor, if the procurement contract has been entered into by a public entity under the control of the governor, or the administrative head of a public entity, if the procurement contract has been entered into by a public entity not under the control of the governor, may grant a temporary waiver from a requirement of Subsection A or B of this section if:

(1) the requirement is waived for a period of one hundred eighty days or less; and

(2) the waiver and the justification for the waiver is posted:

(a) on the database web site maintained pursuant to Section 13-1-97.1 NMSA 1978, if the public entity is a state agency; or

(b) on the web site maintained by the public entity, if the public entity is not a state agency and if the public entity maintains such a web site.

D. As used in this section, "public entity" means the state or any of its officers, branches, agencies, institutions, instrumentalities or political subdivisions.

SECTION 15. REPEAL.--Laws 2001, Chapter 293, Section 1 is repealed.

SECTION 16. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2011.

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