2013 Maryland Code
STATE FINANCE AND PROCUREMENT
§ 13-217 - Multi-year procurement contracts

§13-217.

(a) In this section, “multi-year contract” means a procurement contract that requires appropriations for more than 1 fiscal year.

(b) (1) A unit may enter into a multi-year contract subject to:

(i) standards established by the Board; and

(ii) regulations adopted by the primary procurement unit that is responsible for the type of procurement involved.

(2) A multi-year contract shall be subject to review and approval by that primary procurement unit.

(c) A multi-year contract may not be approved unless each unit reviewing the multi-year contract determines that:

(1) the estimated requirements of the State:

(i) cover the period of the multi-year contract;

(ii) are reasonably firm; and

(iii) are continuing; and

(2) the multi-year contract will serve the best interests of the State by encouraging effective competition or otherwise promoting economy in State procurement.

(d) (1) If money sufficient for the continued performance of a multi-year contract is not appropriated for any fiscal year, the multi-year contract terminates automatically on the earlier of:

(i) the last day of the fiscal year for which money last was appropriated; or

(ii) the date provided in the termination clause of the procurement contract.

(2) If the multi-year contract is terminated under this subsection, the unit shall reimburse the contractor for the reasonable value of any nonrecurring costs that were:

(i) incurred as a result of the multi-year contract; but

(ii) not amortized in the price of the supplies or services delivered under the multi-year contract.

(3) The cost of termination under this subsection may be paid from any appropriation available for that purpose.

(e) Except as provided in subsection (f) of this section, each multi-year contract, including a lease of real property, shall include an automatic termination clause that:

(1) is not inconsistent with the requirements of subsection (d) of this section; and

(2) discharges both parties to the multi-year contract from future performance of that contract, but not from their existing obligations.

(f) (1) On the recommendation of the Secretary of General Services, the Board may waive the requirement to include an automatic termination clause under subsection (e) of this section for a multi-year contract to procure energy generated from a Tier 1 renewable source or a Tier 2 renewable source, as defined in § 7-701 of the Public Utilities Article.

(2) In determining whether or not to grant a waiver under paragraph (1) of this subsection, the Board shall consider the effect of imposing the termination clause requirement under subsection (e) of this section on the ability of the energy supplier to obtain financing for the renewable energy generation project that produces the energy that the State is contracting to procure.