HB1225eng 104TH GENERAL ASSEMBLY

HB1225 Engrossed LRB104 06111 SPS 16144 b

AN ACT concerning State government.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Best Customer Price Act.

Section 5. Findings. The General Assembly finds and declares that:

(1) It has been the long-standing public policy of this State to provide a level playing field in procurement for small and mid-sized businesses. Despite this policy, the portion of State funds spent on small and mid-sized businesses, especially minority-owned, women-owned, and veteran-owned businesses, is persistently far below where the General Assembly believes it should be.

(2) This State has a choice in implementing pricing policy for goods. Manufacturers sometimes give their best price to the largest suppliers and largest resellers, leaving small and mid-sized suppliers and small and mid-sized resellers to pay a higher price. Allowing manufacturers to force smaller suppliers for State purchases to pay a higher price excludes small suppliers from any low-bid State procurement.

(3) On average, minority-owned, women-owned, and veteran-owned businesses are smaller than incumbent firms, and policies that level the playing field in procurement for firms that are smaller will disproportionately benefit minority-owned, women-owned and veteran-owned businesses, rectifying past decades of discrimination in a race-neutral and gender-neutral way.

(4) It has long been public policy to empower State purchasing officials with the ability to require the most favorable terms to be granted to this State on any purchase of supplies or services, and extending this policy to ensure the best customer pricing is extended by manufacturers to this State's suppliers and resellers is consistent with both federal procurement law and State procurement law.

(5) Requiring the best customer price for procured goods will create a more inclusive choice for State procurement and a level playing field for all suppliers, both from the manufacturers to suppliers or resellers and from suppliers or resellers to this State.

(6) It is in the best interest of the taxpayers of this State to ensure that this State's purchases of goods always get the best customer pricing from all participants in the transaction, both from the manufacturer to the supplier or reseller and from the supplier or reseller to this State.

Section 10. Definitions. As used in this Act:

"Best customer pricing" means the best price offered to any customer for the goods this State is seeking to buy, including price, discounts, commissions, rebates, and other incentives that impact the consideration paid for the good.

"Letter of supply" means a document from the manufacturer to a supplier or reseller that indicates the supplier or reseller is able to secure the goods this State seeks to buy.

"Public institution of higher education" has the meaning given to that term in Section 1-13 of the Illinois Procurement Code.

"Reseller" means a registered vendor of this State that supplies goods the company does not manufacture.

"State agency" has the meaning given to that term in Section 1-15.100 of the Illinois Procurement Code.

"Supplier" means a registered vendor of this State that supplies goods the company does not manufacture.

Section 15. Best consumer pricing.

(a) The provisions of this Act apply if a public institution of higher education or a State agency affirmatively requires best customer pricing for a particular procurement of goods. If goods are to be purchased by this State from a supplier or reseller, the supplier or reseller shall attest that the price is the best customer price. The supplier or reseller shall include a provision in the letter of supply from the manufacturer that the supplier or reseller can secure the supply and quantity of goods to be purchased, and that the manufacturer has extended the same best customer pricing from the manufacturer to each of the suppliers or resellers registered with this State for the goods to be purchased.

(b) Nothing in this Section shall require the manufacturer to extend best customer pricing to any supplier or reseller for any goods that are not purchased by this State.

(c) Nothing in this Section shall regulate or impact any commercial relationship between a manufacturer and a supplier or reseller for any goods that are not the subject of a State purchase.

(d) Nothing in this Section shall require any manufacturer, reseller, or supplier to disclose any proprietary information in the letter of supply.

Section 20. Declining bids. If a public institution of higher education or a State agency requires best customer pricing for the goods but does not believe the price is competitive, the public institution of higher education or the State agency may decline to award the bid.

Section 25. Repeal. This Act is repealed on January 1, 2031.

Section 99. Effective date. This Act takes effect upon becoming law.