99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB2229

 

Introduced 1/13/2016, by Sen. Chris Nybo

 

SYNOPSIS AS INTRODUCED:
 
30 ILCS 500/45-57

    Amends the Illinois Procurement Code. Expands the definitions of "qualified service-disabled veteran-owned small business" and "qualified veteran-owned small business" to include service-disabled veteran-owned and veteran-owned small businesses with a significant business presence in Illinois (currently, this includes only service-disabled veteran-owned and veteran-owned small businesses with their home office in Illinois) and removes the owner residency requirement. Defines "significant business presence".


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning State government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Procurement Code is amended by
5changing Section 45-57 as follows:
 
6    (30 ILCS 500/45-57)
7    Sec. 45-57. Veterans.
8    (a) Set-aside goal. It is the goal of the State to promote
9and encourage the continued economic development of small
10businesses owned and controlled by qualified veterans and that
11qualified service-disabled veteran-owned small businesses
12(referred to as SDVOSB) and veteran-owned small businesses
13(referred to as VOSB) participate in the State's procurement
14process as both prime contractors and subcontractors. Not less
15than 3% of the total dollar amount of State contracts, as
16defined by the Director of Central Management Services, shall
17be established as a goal to be awarded to SDVOSB and VOSB. That
18portion of a contract under which the contractor subcontracts
19with a SDVOSB or VOSB may be counted toward the goal of this
20subsection. The Department of Central Management Services
21shall adopt rules to implement compliance with this subsection
22by all State agencies.
23    (b) Fiscal year reports. By each September 1, each chief

 

 

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1procurement officer shall report to the Department of Central
2Management Services on all of the following for the immediately
3preceding fiscal year, and by each March 1 the Department of
4Central Management Services shall compile and report that
5information to the General Assembly:
6        (1) The total number of VOSB, and the number of SDVOSB,
7    who submitted bids for contracts under this Code.
8        (2) The total number of VOSB, and the number of SDVOSB,
9    who entered into contracts with the State under this Code
10    and the total value of those contracts.
11    (c) Yearly review and recommendations. Each year, each
12chief procurement officer shall review the progress of all
13State agencies under its jurisdiction in meeting the goal
14described in subsection (a), with input from statewide
15veterans' service organizations and from the business
16community, including businesses owned by qualified veterans,
17and shall make recommendations to be included in the Department
18of Central Management Services' report to the General Assembly
19regarding continuation, increases, or decreases of the
20percentage goal. The recommendations shall be based upon the
21number of businesses that are owned by qualified veterans and
22on the continued need to encourage and promote businesses owned
23by qualified veterans.
24    (d) Governor's recommendations. To assist the State in
25reaching the goal described in subsection (a), the Governor
26shall recommend to the General Assembly changes in programs to

 

 

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1assist businesses owned by qualified veterans.
2    (e) Definitions. As used in this Section:
3    "Armed forces of the United States" means the United States
4Army, Navy, Air Force, Marine Corps, Coast Guard, or service in
5active duty as defined under 38 U.S.C. Section 101. Service in
6the Merchant Marine that constitutes active duty under Section
7401 of federal Public Act 95-202 shall also be considered
8service in the armed forces for purposes of this Section.
9    "Certification" means a determination made by the Illinois
10Department of Veterans' Affairs and the Department of Central
11Management Services that a business entity is a qualified
12service-disabled veteran-owned small business or a qualified
13veteran-owned small business for whatever purpose. A SDVOSB or
14VOSB owned and controlled by females, minorities, or persons
15with disabilities, as those terms are defined in Section 2 of
16the Business Enterprise for Minorities, Females, and Persons
17with Disabilities Act, may also select and designate whether
18that business is to be certified as a "female-owned business",
19"minority-owned business", or "business owned by a person with
20a disability", as defined in Section 2 of the Business
21Enterprise for Minorities, Females, and Persons with
22Disabilities Act.
23    "Control" means the exclusive, ultimate, majority, or sole
24control of the business, including but not limited to capital
25investment and all other financial matters, property,
26acquisitions, contract negotiations, legal matters,

 

 

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1officer-director-employee selection and comprehensive hiring,
2operation responsibilities, cost-control matters, income and
3dividend matters, financial transactions, and rights of other
4shareholders or joint partners. Control shall be real,
5substantial, and continuing, not pro forma. Control shall
6include the power to direct or cause the direction of the
7management and policies of the business and to make the
8day-to-day as well as major decisions in matters of policy,
9management, and operations. Control shall be exemplified by
10possessing the requisite knowledge and expertise to run the
11particular business, and control shall not include simple
12majority or absentee ownership.
13    "Qualified service-disabled veteran" means a veteran who
14has been found to have 10% or more service-connected disability
15by the United States Department of Veterans Affairs or the
16United States Department of Defense.
17    "Qualified service-disabled veteran-owned small business"
18or "SDVOSB" means a small business (i) that is at least 51%
19owned by one or more qualified service-disabled veterans living
20in Illinois or, in the case of a corporation, at least 51% of
21the stock of which is owned by one or more qualified
22service-disabled veterans living in Illinois; (ii) that has its
23home office in Illinois or that has a significant business
24presence in Illinois; and (iii) for which items (i) and (ii)
25are factually verified annually by the Department of Central
26Management Services.

 

 

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1    "Qualified veteran-owned small business" or "VOSB" means a
2small business (i) that is at least 51% owned by one or more
3qualified veterans living in Illinois or, in the case of a
4corporation, at least 51% of the stock of which is owned by one
5or more qualified veterans living in Illinois; (ii) that has
6its home office in Illinois or that has a significant business
7presence in Illinois; and (iii) for which items (i) and (ii)
8are factually verified annually by the Department of Central
9Management Services.
10    "Service-connected disability" means a disability incurred
11in the line of duty in the active military, naval, or air
12service as described in 38 U.S.C. 101(16).
13    "Significant business presence" means a business
14authorized to do business in Illinois, and that makes a
15contribution to the Illinois economy through the payment of
16taxes, or the purchase of made-in-Illinois construction,
17construction services, non-constructive, technology,
18commodities, or products or that has any payroll in Illinois.
19    "Small business" means a business that has annual gross
20sales of less than $75,000,000 as evidenced by the federal
21income tax return of the business. A firm with gross sales in
22excess of this cap may apply to the Department of Central
23Management Services for certification for a particular
24contract if the firm can demonstrate that the contract would
25have significant impact on SDVOSB or VOSB as suppliers or
26subcontractors or in employment of veterans or

 

 

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1service-disabled veterans.
2    "State agency" has the same meaning as in Section 2 of the
3Business Enterprise for Minorities, Females, and Persons with
4Disabilities Act.
5    "Time of hostilities with a foreign country" means any
6period of time in the past, present, or future during which a
7declaration of war by the United States Congress has been or is
8in effect or during which an emergency condition has been or is
9in effect that is recognized by the issuance of a Presidential
10proclamation or a Presidential executive order and in which the
11armed forces expeditionary medal or other campaign service
12medals are awarded according to Presidential executive order.
13    "Veteran" means a person who (i) has been a member of the
14armed forces of the United States or, while a citizen of the
15United States, was a member of the armed forces of allies of
16the United States in time of hostilities with a foreign country
17and (ii) has served under one or more of the following
18conditions: (a) the veteran served a total of at least 6
19months; (b) the veteran served for the duration of hostilities
20regardless of the length of the engagement; (c) the veteran was
21discharged on the basis of hardship; or (d) the veteran was
22released from active duty because of a service connected
23disability and was discharged under honorable conditions.
24    (f) Certification program. The Illinois Department of
25Veterans' Affairs and the Department of Central Management
26Services shall work together to devise a certification

 

 

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1procedure to assure that businesses taking advantage of this
2Section are legitimately classified as qualified
3service-disabled veteran-owned small businesses or qualified
4veteran-owned small businesses.
5    (g) Penalties.
6        (1) Administrative penalties. The chief procurement
7    officers appointed pursuant to Section 10-20 shall suspend
8    any person who commits a violation of Section 17-10.3 or
9    subsection (d) of Section 33E-6 of the Criminal Code of
10    2012 relating to this Section from bidding on, or
11    participating as a contractor, subcontractor, or supplier
12    in, any State contract or project for a period of not less
13    than 3 years, and, if the person is certified as a
14    service-disabled veteran-owned small business or a
15    veteran-owned small business, then the Department shall
16    revoke the business's certification for a period of not
17    less than 3 years. An additional or subsequent violation
18    shall extend the periods of suspension and revocation for a
19    period of not less than 5 years. The suspension and
20    revocation shall apply to the principals of the business
21    and any subsequent business formed or financed by, or
22    affiliated with, those principals.
23        (2) Reports of violations. Each State agency shall
24    report any alleged violation of Section 17-10.3 or
25    subsection (d) of Section 33E-6 of the Criminal Code of
26    2012 relating to this Section to the chief procurement

 

 

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1    officers appointed pursuant to Section 10-20. The chief
2    procurement officers appointed pursuant to Section 10-20
3    shall subsequently report all such alleged violations to
4    the Attorney General, who shall determine whether to bring
5    a civil action against any person for the violation.
6        (3) List of suspended persons. The chief procurement
7    officers appointed pursuant to Section 10-20 shall monitor
8    the status of all reported violations of Section 17-10.3 or
9    subsection (d) of Section 33E-6 of the Criminal Code of
10    1961 or the Criminal Code of 2012 relating to this Section
11    and shall maintain and make available to all State agencies
12    a central listing of all persons that committed violations
13    resulting in suspension.
14        (4) Use of suspended persons. During the period of a
15    person's suspension under paragraph (1) of this
16    subsection, a State agency shall not enter into any
17    contract with that person or with any contractor using the
18    services of that person as a subcontractor.
19        (5) Duty to check list. Each State agency shall check
20    the central listing provided by the chief procurement
21    officers appointed pursuant to Section 10-20 under
22    paragraph (3) of this subsection to verify that a person
23    being awarded a contract by that State agency, or to be
24    used as a subcontractor or supplier on a contract being
25    awarded by that State agency, is not under suspension
26    pursuant to paragraph (1) of this subsection.

 

 

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1(Source: P.A. 97-260, eff. 8-5-11; 97-1150, eff. 1-25-13;
298-307, eff. 8-12-13; 98-1076, eff. 1-1-15.)