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H.B. 289

             1     

PRIVATIZATION POLICY BOARD

             2     
2000 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Sponsor: John E. Swallow

             5      AN ACT RELATING TO THE PRIVATIZATION POLICY BOARD; EXPANDING THE
             6      DUTIES OF THE BOARD; CHANGING THE MEMBERSHIP OF THE BOARD; REQUIRING
             7      PUBLIC HEARINGS AND RECOMMENDATIONS ON GOVERNMENT COMPETITION
             8      WITH PRIVATE ENTERPRISE; STATING THE INTENT OF THE LEGISLATURE WITH
             9      RESPECT TO PUBLIC-PRIVATE COMPETITION; AND MAKING TECHNICAL CHANGES.
             10      This act affects sections of Utah Code Annotated 1953 as follows:
             11      AMENDS:
             12          63-55a-1, as enacted by Chapter 221, Laws of Utah 1989
             13          63-55a-2, as last amended by Chapters 18, 194 and 243, Laws of Utah 1996
             14          63-55a-3, as last amended by Chapter 18, Laws of Utah 1996
             15      ENACTS:
             16          63-55a-4, Utah Code Annotated 1953
             17      Be it enacted by the Legislature of the state of Utah:
             18          Section 1. Section 63-55a-1 is amended to read:
             19           63-55a-1. Definitions.
             20          As used in this chapter:
             21          (1) "Agency" or "government agency" means a department, division, office, bureau, board,
             22      commission, or other [administrative unit of the state] agency of government, or any other
             23      governmental unit or political subdivision existing in the state or any other creation of the state or
             24      political subdivision of the state, regardless of whether funds are appropriated to such agency.
             25          (2) "Agency head" means the chief administrative officer of an agency.
             26          (3) "Institution of higher education" or "institution" means a college, university, or
             27      community college supported by the state.


             28          (4) "Private enterprise" means an individual, firm, partnership, joint venture, corporation,
             29      association, or any other legal entity engaging in the manufacturing, processing, sale, offering for
             30      sale, rental, leasing, delivery, dispensing, distributing, or advertising of goods or services for profit.
             31          [(3)] (5) "Privatization" means action by a state agency to contract with the private sector
             32      or with another state agency to perform functions or services currently being performed by it.
             33          Section 2. Section 63-55a-2 is amended to read:
             34           63-55a-2. Privatization Policy Board -- Created -- Membership -- Operations --
             35      Expenses.
             36          (1) (a) There is created a Privatization Policy Board composed of [13] 15 members.
             37          (b) The governor shall appoint:
             38          (i) two senators, one each from the majority and minority political parties, from names
             39      recommended by the president of the Senate;
             40          (ii) two representatives, one each from the majority and minority political parties, from
             41      names recommended by the speaker of the House;
             42          (iii) two administrative officers or executive directors from government agencies;
             43          [(iii)] (iv) two members representing public employees, from names recommended by the
             44      largest public employees' association;
             45          [(iv)] (v) one [member from state management] representative from a political subdivision
             46      of the state;
             47          [(v) ] (vi) five members from the private business community; and
             48          [(vi)] (vii) one [member representing education] representative from an institution of
             49      higher education.
             50          (2) (a) Except as required by Subsection (2)(b), board members shall serve four-year terms.
             51          (b) Notwithstanding the requirements of Subsection (2)(a), the governor shall, at the time
             52      of appointment or reappointment, adjust the length of terms to ensure that the terms of board
             53      members are staggered so that approximately half of the board is appointed every two years.
             54          (3) (a) Each board member shall hold office until his successor has been appointed and
             55      qualified.
             56          (b) When a vacancy occurs in the membership for any reason, the replacement shall be
             57      appointed for the unexpired term.
             58          (c) [Seven] Eight members of the board are a quorum for the purpose of organizing the


             59      board and conducting the business of the board.
             60          (d) The vote of a majority of members voting when a quorum is present is necessary for
             61      the board to take action.
             62          (4) (a) At the initial meeting of the board, the board shall select one of their number to
             63      serve as chair of the board.
             64          (b) The chief procurement officer or his designee is the nonvoting secretary to the board
             65      and is responsible for scheduling quarterly meetings.
             66          (c) The board shall meet at least quarterly and at the call of the chair.
             67          (d) The Division of Purchasing and General Services shall provide staff support to the
             68      board.
             69          (5) (a) (i) Members who are not government employees shall receive no compensation or
             70      benefits for their services, but may receive per diem and expenses incurred in the performance of
             71      the member's official duties at the rates established by the Division of Finance under Sections
             72      63A-3-106 and 63A-3-107 .
             73          (ii) Members may decline to receive per diem and expenses for their service.
             74          (b) (i) State government officer and employee members who do not receive salary, per
             75      diem, or expenses from their agency for their service may receive per diem and expenses incurred
             76      in the performance of their official duties from the board at the rates established by the Division
             77      of Finance under Sections 63A-3-106 and 63A-3-107 .
             78          (ii) State government officer and employee members may decline to receive per diem and
             79      expenses for their service.
             80          (c) Legislators on the committee shall receive compensation and expenses as provided by
             81      law and legislative rule.
             82          Section 3. Section 63-55a-3 is amended to read:
             83           63-55a-3. Privatization Policy Board -- Duties.
             84          (1) The board shall:
             85          (a) review whether or not certain services performed by existing state agencies could be
             86      privatized to provide the same types and quality of services [that would result in cost savings];
             87          (b) review particular requests for privatization of services and issues concerning agency
             88      competition with the private sector and determine whether privatization would be feasible and
             89      would result in [cost savings and] ways to eliminate [any unfair competition] or limit unjustified


             90      competition with private enterprise;
             91          (c) recommend privatization to the agency head when the proposed privatization is
             92      demonstrated to provide a more cost efficient and effective manner of providing existing
             93      governmental services;
             94          [(d) comply with the provisions of Title 63, Chapter 46a, the Utah Administrative
             95      Rulemaking Act, in making rules establishing privatization standards, procedures, and
             96      requirements;]
             97          [(e)] (d) maintain communication with and access information from, other entities
             98      promoting privatization;
             99          (e) hold public hearings on government competition or proposed government competition
             100      with private enterprise;
             101          (f) prepare an annual report that contains:
             102          (i) information about the board's activities; [and]
             103          (ii) recommendations on privatizing government services; and
             104          (iii) recommendations regarding proposed legislation relating to the prohibition or
             105      limitation of government competition or proposed government competition with private enterprise;
             106          (g) submit the annual report to the Legislature and the governor[.] no later than September
             107      30 of each year; and
             108          [(2) In addition to filing copies of its recommendations for privatization with the relevant
             109      agency head, the board shall file copies of its recommendations for privatization with:]
             110          [(a) the governor's office; and (b)]
             111          (h) file copies of its recommendations with:
             112          (i) the relevant agency head; and
             113          (ii) the Office of Legislative Fiscal Analyst for submission to the relevant Legislative
             114      Appropriation Subcommittee.
             115          [(3)] (2) (a) The board may appoint advisory groups to conduct studies, research, analyses,
             116      and make reports and recommendations with respect to subjects or matters within the jurisdiction
             117      of the board.
             118          (b) At least one member of the board shall serve on each advisory group.
             119          [(4)] (3) This chapter does not preclude any agency from privatizing any service or
             120      function independently of the board if:


             121          (a) the contract is expending less than $2,000,000 of the agency budget in a fiscal year;
             122          (b) as part of the contract that privatizes the function, the contractor assumes all liability
             123      to perform the privatizated function; and
             124          (c) the agency notifies the board at least 120 days before the privatization occurs of their
             125      intent to privatize the function.
             126          Section 4. Section 63-55a-4 is enacted to read:
             127          63-55a-4. General policy statement regarding public-private competition.
             128          While performing its duties, the board shall consider the fundamental principle that a
             129      government agency or institution of higher education is charged with the duty to protect the public
             130      safety, health, and welfare and to provide educational opportunities to the public. Government
             131      agencies and institutions of higher education should not be involved in private enterprise functions
             132      unless a legitimate need can be demonstrated. In those cases where a legitimate need is
             133      demonstrated, government agencies and institutions of higher education should not exploit a
             134      competitive advantage over private enterprise as a result of their status as a government agency or
             135      institution of higher education.




Legislative Review Note
    as of 2-10-00 4:14 PM


A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel


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