"An Act relating to a procurement and electronic commerce tools program for state departments and instrumentalities of the state. "

The pilot procurement program is in its third year of authorization and is facing a sunset date of June 30, 2006 unless the Legislature acts to extend it. This bill extends the program's exemption from some elements of the procurement code by three years, narrows the scope of that exemption and provides broader access to modern web-based e-Commerce tools across state government. Any decision to continue the program is at the sole discretion of the state.

Even though the "pilot" program has not been given adequate scale to demonstrate its true potential, it is clear from a number of performance measures that the private sector contractor has implemented a successful program. Office productivity levels are measurably higher, time required to process transactions has fallen and, notably, use of Alaska vendors has risen sharply.

A pilot program is meant to result in "lessons learned" that are then used to expand wisely. This bill draws from those lessons learned by narrowing the scope of the program in some very important ways, while expanding the electronic commerce elements.

The Administration and the program contractor concur that senior state procurement officers should be retained and that the private sector operation should be limited primarily to the purchase of goods under $50,000. Under this bill, procurements over $50,000 and most contracts for services will be handled by state procurement personnel.

The benefit of this change is that it respects and retains the institutional knowledge of trained state procurement officers. The private sector contractor will now specialize in repetitive operations that best lend themselves to automation and productivity management.

Those Departments that are not participating in the operational elements of the program gain access to web based e-Commerce tools. State procurement specialists will be able to use these tools as well. This will create an environment whereby private sector operational performance can be benchmarked accurately against public sector performance.

Under this new committee substitute, competitive bids by the contractor would be subject to the Alaska bidder preferences, disabled persons preference, the Forest Products and Agricultural/Fisheries Products preferences, and the Recycled Alaska Products provisions in the state procurement code.

Section 9 of the CS requires any contractor providing procurement services under this bill shall be fully subject to the procurement code beginning July 1, 2009.

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