2016 North Dakota Century Code Title 54 State Government Chapter 54-44.4 State Purchasing Practices
Download as PDF
CHAPTER 54-44.4
STATE PURCHASING PRACTICES
54-44.4-01. Declaration of policy - Definitions.
It is state policy to provide comprehensive purchasing services based upon sound
procurement practices and principles wherein, through full competition with fair and equal
opportunity to all qualified persons to sell to the state, each state agency and institution shall
obtain its necessary commodities and services at competitive cost, consistent with quality, time,
and performance requirements, except as otherwise provided by law. As used in this chapter,
unless the context requires otherwise:
1. "Commodities" means all property, including equipment, supplies, materials, printing,
insurance, and leases of equipment.
2. "Procurement officer" means an individual duly authorized to enter and administer
purchasing contracts and make written determinations with respect thereto and also
includes an authorized representative acting within the limits of authority.
3. "Professional services" means those services requiring special knowledge, education,
or skills when the qualifications and experience of the individual rendering the services
are of primary importance and the individual is required to exercise professional
judgment. Professional services providers include appraisers, attorneys, accountants,
psychologists, physicians, dentists, planners, analysts, and consultants. The term
includes human services under which a person provides direct health or social welfare
services to the citizens on behalf of the state. The term does not include services
defined in section 54-44.7-01.
4. "Purchasing agency" means a governmental entity in the executive branch of
government other than the office of management and budget which is authorized by
this chapter, rules adopted under this chapter, written policy of the office of
management and budget, or by way of delegation from the office of management and
budget to enter purchasing contracts for commodities and services.
5. "Services" means the furnishing of labor, time, or effort by a contractor, not involving
the delivery of a specific end product other than reports that are merely incidental to
the required performance. The term includes professional services.
54-44.4-02. Office of management and budget purchasing services.
The office of management and budget shall purchase or lease or otherwise arrange for the
procurement, for all state agencies and institutions in the executive branch of state government,
all materials, furniture, fixtures, printing, insurance, services, and other commodities. The
International Peace Garden may participate in the procurement authorized by this section. The
following commodities and services, however, are not subject to the procurement requirements
of this chapter:
1. Land, buildings, space, or the rental thereof.
2. Telephone and telegraph service and electrical light and power services.
3. Public books, maps, periodicals, and technical pamphlets.
4. Department of transportation materials, equipment, and supplies in accordance with
section 24-02-16.
5. Procurements by the industrial commission for energy-related programs under
chapters 17-05, 54-17.5, 54-17.6, 54-17.7, and 54-63 and under those statutes in
title 38 authorizing the industrial commission to perform well and hole pluggings,
reclamation work, equipment removal, leak prevention, and similar work.
6. Services for the maintenance or servicing of equipment by the manufacturer or
authorized servicing agent of that equipment when the maintenance or servicing can
best be performed by the manufacturer or authorized service agent, or when such a
contract would otherwise be advantageous to the state.
7. Emergency purchases the office of management and budget cannot make within the
required time and which involve public health or public safety, or when immediate
expenditures are necessary for repairs of state property to protect it against further
loss or damage, or to prevent or minimize serious disruption in state services.
Page No. 1
Emergency purchases must be made with the level of competition practicable under
the circumstances, and a written determination of the basis for the emergency and for
the selection of the particular contractor must be included in the contract file.
8. Commodities and services costing less than a specified amount as determined by
written directive by the director of the office of management and budget.
9. Specified commodities and services as determined by written directive by the director
of the office of management and budget.
10. Employee benefit services, trust-related services, and investment management
services obtained by an agency with a fiduciary responsibility regarding those
services.
All purchases made by the office of management and budget or a state agency or institution to
which authority to purchase has been delegated by the office of management and budget must
be made in accordance with this chapter, rules adopted under this chapter, and written policies
of the office of management and budget.
54-44.4-02.1. Procurement of services.
All services purchased by the office of management and budget or by an agency or
institution in the executive branch of state government must comply with the standards and
guidelines for procurement of services established by the office of management and budget.
Before March first of each year, each agency or institution in the executive branch of state
government which purchases services shall file with the office of management and budget a
report regarding the services purchased the preceding year. The report must be provided on
forms established and made available by the office of management and budget.
54-44.4-02.2. Specified exempt commodities and services - Report to the budget
section.
The director of the office of management and budget shall report to the budget section in
December of even-numbered years on specified commodities and services exempted by written
directive of the director from the procurement requirements of chapter 54-44.4.
54-44.4-03. Director of the office of management and budget may delegate
purchasing authority.
The director of the office of management and budget or the director's designee may
delegate to state agencies and institutions the authority to make purchases of items not
otherwise exempted by law. Any delegation of purchasing authority must be in writing and must
specify what may be purchased by the agency or institution and the duration of the delegation.
54-44.4-04. Office of management and budget - Rules.
The office of management and budget shall adopt, in accordance with the procedures
provided by chapter 28-32, rules necessary to administer this chapter. The written directives
issued by the director exercising authority provided in sections 54-44.4-02 and 54-44.4-03 need
not be adopted in accordance with chapter 28-32.
54-44.4-05. Competitive, limited competitive, noncompetitive, and negotiated
purchases - Exempt records.
1. Except as otherwise provided in section 44-08-01, chapter 25-16.2, and this chapter,
purchasing contracts must be awarded through a competitive bidding process to the
lowest responsible bidder considering conformity with specifications, terms of delivery,
and quality and serviceability, unless it is determined to be advantageous to the state
to select a contractor through a competitive proposal process using other or additional
criteria. The procurement officer may reject any or all bids or negotiate for a lower
price with a successful bidder. Each bid received, with the name of the bidder, must be
recorded. The office of management and budget may enter into term contracts for the
acquisition of commodities or services and may make multiple awards for term
commodity or service contracts when it deems a multiple award to be in the best
Page No. 2
2.
interests of the state. All bids received under this chapter pursuant to a competitive
sealed bid are exempt records under subsection 5 of section 44-04-17.1 until the date
and time the bids are opened.
The office of management and budget shall adopt rules specifying the circumstances
under which competition may be waived or limited, when negotiation may be used,
and specifying the required justifications and procedures for using those methods of
purchasing. The office of management and budget shall adopt rules related to sending
notice of intent to make limited competitive, noncompetitive, and negotiated purchases
in accordance with this chapter. The notice must describe the needed commodity or
service and the intended procurement method and must state that vendors are
permitted to submit bids or proposals for contracts to be awarded under this section.
The circumstances that may permit limited competitive, noncompetitive, or negotiated
purchases include:
a. The commodity or service is available from only one source.
b. The commodity or service is to be purchased for experimentation or trial.
c. No acceptable bid or proposal was received pursuant to a competitive bidding or
competitive proposal process.
d. Commodities are being purchased for over-the-counter resale.
e. Acceptable commodities or services are produced or provided by correctional
institutions or other government agencies or a work activity center as defined in
section 25-16.2-01.
f. The anticipated cost of purchasing specified commodities or services is less than
an amount determined by the office of management and budget which would
justify the expense of a competitive bidding or competitive proposal process.
g. A used commodity is advantageous to the state and the commodity is available
only on short notice.
h. The commodity is a component or replacement part for which there is no
commercially available substitute and which can be obtained only from the
manufacturer.
i. Compatibility with equipment currently owned by the state is essential to the
proper functioning of that equipment.
j. The agency provides documentation indicating that the services or the
circumstances are of such a nature that deviation from the procurement
procedure is appropriate.
54-44.4-06. All purchases to be made in accordance with specifications - Multistep
sealed bids.
1. For purposes of this chapter, specification means a description of all required physical,
design, performance, functional, and other characteristics of a commodity or service
the purchaser requires and, consequently, what a bidder must offer. The office of
management and budget and institutions of higher education shall develop similar
specifications for purchases of commodities and services of high common usage.
State agencies and institutions shall provide such assistance as may be requested by
the office of management and budget and the institutions of higher education in the
development of specifications. The office of management and budget and the
institutions of higher education shall implement such procedures as are necessary for
the inspection, testing, and acceptance of commodities or services to determine that
those received are in conformity with contract specifications.
2. When it is determined to be impractical to initially prepare a purchase description to
support an award based on price, a solicitation may be issued requesting the
submission of unpriced offers to be followed by a competitive bidding or competitive
proposal process limited to those bidders or offerors found to be qualified under the
criteria set forth in the first solicitation.
Page No. 3
54-44.4-07. Procurement of environmentally preferable products.
1. The office of management and budget, the institutions of higher education, and any
other state agency or institution that has authority to purchase products are
encouraged to purchase environmentally preferable products.
a. Where practicable, specifications for purchasing newsprint printing services
should specify the use of soybean-based ink. The North Dakota soybean council
and the agriculture commissioner shall assist the office of management and
budget in locating suppliers of soybean-based inks and in collecting data on the
purchase of soybean-based inks.
b. In requesting bids for paper products, the office of management and budget must
request information on the recycled content of such products.
c. Where practicable, biobased products should be specified.
2. The office of management and budget, in coordination with the state board of higher
education, shall develop guidelines for a biobased procurement program.
54-44.4-08. Purchase of recycled paper products.
The office of management and budget, and any state agency or institution that has authority
to purchase products, shall ensure that at least twenty percent of the total volume of paper and
paper products being purchased for state agencies and institutions contain at least twenty-five
percent recycled material. The office of management and budget shall implement a
methodology to track compliance with this section.
54-44.4-09. Approved vendors.
1. The office of management and budget shall establish and maintain current lists of
persons that desire to provide commodities or services to the state. Every person that
desires to bid or submit a proposal on contracts for commodities or services awarded
under this chapter must be an approved vendor in order to be placed on the bidders
list. The office of management and budget or the purchasing agency shall use the list
when issuing invitation for bids or request for proposals over the amount established
for small purchases, except as otherwise provided in this section. The office of
management and budget or the purchasing agency shall use the list when sending
notice of intent to make cooperative, limited competitive, noncompetitive, and
negotiated purchases.
2. To become an approved vendor a person shall file an application with the office of
management and budget. The application must contain information requested by the
office of management and budget, including business and persons' names, telephone
numbers, addresses, federal tax identification numbers, type of business organization,
the types of commodities or services for which the applicant is interested in receiving
solicitations, and other business information the office of management and budget
determines relevant. The application must also contain a statement appointing the
secretary of state as the applicant's agent for service of process pursuant to
subsection 3. The application must be signed and certified by an owner, partner, or
company officer authorized by company bylaws or other organizational document to
bind the company. The signature requirement may include the use of an electronic
signature as defined in section 9-16-01 when authorized under section 9-16-17. The
office of management and budget may require proof of the signing person's authority
by certified copy of appropriate company documents.
3. At the time of filing the application to become an approved vendor, the applicant, if
organized as a corporation, limited liability company, limited liability partnership, or
limited partnership, must be properly and currently registered with the secretary of
state according to its type of business organization as a corporation under
chapter 10-19.1, a limited liability company under chapter 10-32.1, a limited liability
partnership under chapter 45-22, or a limited partnership under chapter 45-10.2. Any
exemptions to registration under the above chapters that would otherwise apply to
those entities organized as such do not apply to this section and registration must be
made for the applicant to become an approved vendor. Applicants for approved vendor
Page No. 4
4.
status using a trade name or a fictitious partnership name must be in full compliance
with chapter 47-25 or 45-11 at the time of making the application. Whenever any
registration required by this section is canceled, revoked, or not renewed, the vendor
ceases to be an approved vendor.
By signing and filing the application, the vendor applicant appoints the secretary
of state as its true and lawful agent for service of process in this state upon whom may
be served all lawful process in any action or proceeding against the vendor if the
vendor or its registered agent cannot be found for service of process in this state. The
signed application is written evidence of the applicant's consent that any process
served against the applicant that is so served upon the secretary of state is of the
same legal force and effect as if served upon the applicant personally within this state.
Within ten days after service of the summons upon the secretary of state pursuant to
this subsection, notice of the service with the summons and complaint in the action
must be sent to the defendant vendor at the vendor's last-known address by certified
mail with return receipt requested and proof of mailing must be attached to the
summons. The secretary of state shall keep a record of all process served upon the
secretary of state under this section showing the day and hour of service. When
service of process is made as provided in this subsection, the court, before entering a
default judgment, or at any stage of the proceeding, may order a continuance as may
be necessary to afford the defendant vendor reasonable opportunity to defend any
action pending against the vendor.
The procurement officer may authorize receipt of a bid or proposal from a vendor that
is not on the list of approved vendors if the procurement officer makes a written
determination that it is in the best interest of the state to receive the bid or proposal.
The successful bidder or offeror must become approved before the award and the
existence of this approval requirement must be stated in the solicitation. If an
unapproved vendor is selected for award, the vendor's bid or proposal may be rejected
if that vendor fails to become approved within sixty days or within a shorter period as
specified in writing by the procurement officer. Before issuing a solicitation, the
procurement officer may waive the approval requirement if the procurement officer
determines, in consultation with the secretary of state, that registration with the
secretary of state and appointment of an agent for service of process in this state are
not required. The waiver of the approval requirement must be stated in the solicitation.
In the event that two or more bids contain identical pricing or receive identical
evaluation scores, preference must be given pursuant to section 44-08-01.1. If the
application of section 44-08-01.1 does not result in the award of a contract, preference
must be given to bids submitted by vendors approved under this section.
54-44.4-10. Competitive sealed proposals - Exempt records.
1. A contract for commodities or services may be entered by competitive sealed
proposals when a determination is made that the use of competitive sealed bidding is
either not practicable or not advantageous to the state. The request for proposal must
state the relative importance of price and other factors and subfactors, if any.
2. Proposals must be opened so as to avoid disclosure of contents to competing offerors
during the process of negotiation. All proposals received pursuant to a competitive
sealed proposal process are exempt records under subsection 5 of section 44-04-17.1
until an award is made.
3. Discussions may be conducted with responsible offerors who submit proposals
determined to be reasonably susceptible of being selected for award for the purpose of
clarification to assure full understanding of, and responsiveness to, the solicitation
requirements. Offerors must be accorded fair and equal treatment with respect to any
opportunity for discussion and revision of proposals, and revisions may be permitted
after submissions and before award for the purpose of obtaining best and final offers.
In conducting discussions, there may be no disclosure of any information derived from
proposals submitted by competing offerors.
Page No. 5
4.
Unless all proposals are rejected, award must be made to the responsible offeror
whose proposal conforms to the solicitation and is determined, in writing, to be the
most advantageous to the state, taking into consideration price and the evaluation
factors set forth in the request for proposals. No other factors or criteria may be used
in the evaluation. The contract file must contain the basis on which the award is made.
Written notice of the award of the contract to the successful offeror must be promptly
given to all offerors.
54-44.4-11. Small purchases.
1. A procurement not exceeding the amount established by written directive of the
director of the office of management and budget or by the state board of higher
education under subsection 5 of section 15-10-17 may be made in accordance with
small purchase procedures.
2. A small purchase need not be made through competitive sealed bidding or competitive
sealed proposals. However, small purchases must be made with competition that is
practicable under the circumstances.
3. Procurement requirements may not be artificially divided as to constitute a small
purchase under this section.
54-44.4-12. Resolution of protested solicitations and awards.
1. An interested party may protest the award of a contract, the notice of intent to award a
contract, or a solicitation for commodities or services by the office of management and
budget or purchasing agency under this chapter. The protest must be submitted in
writing to the procurement officer responsible for the contract or solicitation within
seven calendar days after the protestor knows or should have known of the facts
giving rise to the protest.
2. If a contract has been awarded, the procurement officer immediately shall give notice
of a protest to the contractor. In the case of pending award, a stay of award may be
requested. A stay must be granted unless a written determination is made that the
award of the contract without delay is necessary to protect the interests of the state.
3. If the protest is not resolved by mutual agreement, the procurement officer promptly
shall send by certified mail to the protestor a written decision containing the basis for
the decision and inform the protestor of the protestor's right to appeal.
4. The protestor may file an appeal of the decision rendered by the procurement officer
with the director of the office of management and budget or designee. An appeal must
be filed in writing within seven calendar days after the protestor receives the decision
rendered by the procurement officer of the office of management and budget or the
purchasing agency. The appeal must include a copy of the decision being appealed
and the basis for the appeal. Within seven calendar days the director of the office of
management and budget or the director's designee shall send by certified mail written
notice of the decision to the protestor.
54-44.4-13. Cooperative purchasing.
1. The office of management and budget shall purchase commodities or services as
requested by agencies and institutions under the jurisdiction of the state board of
higher education and the legislative and judicial branches of state government.
2. The office of management and budget and the agencies and institutions under the
jurisdiction of the state board of higher education shall make joint purchases of like
commodities or services of high common usage when the office of management and
budget and the state board of higher education determine it is in the best interest of
the state.
3. The director of the office of management and budget or the director's designee may
agree to purchase commodities or services under contracts entered into by the United
States general services administration or contracts of other government entities if it is
determined to be in the best interest of the state after consideration of price,
Page No. 6
4.
5.
6.
7.
contractual terms and conditions, and the availability of competition from approved
vendors under section 54-44.4-09.
The director of the office of management and budget or the director's designee may
participate in, sponsor, or administer a cooperative purchasing agreement with one or
more government entities or a nonprofit organization established on behalf of public
entities for the procurement of commodities or services in accordance with an
agreement entered into between the participants.
The director of the office of management and budget or the director's designee may
coordinate with the director of the department of transportation or the director's
designee to establish or participate in contracts which may be made available to
entities that have been determined by the department of transportation to be
transportation providers under chapter 39-04.2 eligible to receive state funds or federal
funds for public transportation.
Cooperative purchasing may include open-ended contracts that are available to other
government entities, nonprofit organizations established on behalf of public entities,
tribal agencies, or transportation providers determined to be eligible under this section.
Before entering into a cooperative purchasing agreement under this section, the office
of management and budget must determine that the contracts were awarded through
full and open competition or source selection methods specified in section 54-44.4-05
and shall send notice to approved vendors of the office's intent to make a cooperative
purchase in accordance with this chapter.
54-44.4-14. Procurement information - Website.
1. The office of management and budget shall establish and maintain a procurement
information website on the internet. This procurement information website must
provide current information regarding North Dakota government procurement
opportunities in order to inform potential vendors of the commodities and services
sought by state agencies and institutions. Notwithstanding section 54-44.4-09, for
each purchase of services or commodities over the amount established for small
purchases, the office of management and budget and every purchasing agency shall
provide procurement information on the website. The time period and manner of
providing procurement information on the website must be in accordance with rules
adopted by the office of management and budget. The office of management and
budget may contract with a third party to assist in providing or maintaining the
procurement information website.
2. A state agency or institution may elect to use the procurement information website for
the purchase of services and commodities that are not subject to the procurement
requirements of this chapter, including:
a. Commodities and services exempted under section 54-44.4-02;
b. Public improvements under title 48;
c. Architect, engineer, construction management, and land surveying services under
chapter 54-44.7; and
d. Concessions under chapter 48-09.
Page No. 7
Disclaimer: These codes may not be the most recent version. North Dakota may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.