SB0245 104TH GENERAL ASSEMBLY

LRB104 08022 JDS 18068 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB0245

Introduced 1/22/2025, by Sen. Kimberly A. Lightford

SYNOPSIS AS INTRODUCED:

30 ILCS 575/3.5
30 ILCS 575/5	from Ch. 127, par. 132.605
30 ILCS 575/7	from Ch. 127, par. 132.607
30 ILCS 575/8	from Ch. 127, par. 132.608

Amends the Business Enterprise for Minorities, Women, and Persons with Disabilities Act. Provides that the Business Enterprise Program shall (rather than may) establish uniform standards for calculating contract specific Business Enterprise Program goals for all State contracts and State construction contracts subject to the Act. Provides that no State agency or public institution of higher education shall maintain a policy of establishing contract specific goals for the participation of certified vendors that is inconsistent with or less stringent than the uniform standards for calculating contract specific goals established by the Business Enterprise Program. Requires each State agency and public institution of higher education that is subject to the requirements of the Act, on an annual basis, to submit a report to the Business Enterprise Council detailing its plan to meet the aspirational contract goals established under the Act and established for that agency, institution, or department. Requires the Secretary of the Business Enterprise Council to establish an enforcement procedure whereby the Council may recommend to the appropriate State legal officer that the State exercise its legal remedies which shall include, among other things, the imposition of certain damages (rather than a specified penalties). Provides that the Business Enterprise Council may (rather than shall) grant a waiver of contract-specific Business Enterprise Program goals. Sets out factors that the Business Enterprise Program is to consider when developing procedures for determining whether a vendor has made good faith efforts to meet the contract goals.

A BILL FOR

AN ACT concerning finance.

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

Section 5. The Business Enterprise for Minorities, Women, and Persons with Disabilities Act is amended by changing Sections 3.5, 5, 7, and 8 as follows:

(30 ILCS 575/3.5)

Sec. 3.5. Uniform standard of contract goals.

(a) The Business Enterprise Program shall may establish uniform standards for calculating contract specific Business Enterprise Program goals for all State contracts and State construction contracts subject to this Act. The uniform standards In establishing those standards, the Business Enterprise Program may consider normal industry practice, the scope of the work to be performed under a contract, the availability of vendors that are able to perform the scope of the work to be performed under a contract, the availability of certified vendors that are able to perform the work to be performed under a contract, and the State's progress to date toward meeting the aspirational goals set forth in this Act.

(b) No State agency or public institution of higher education shall maintain a policy of establishing contract specific goals for the participation of certified vendors that is inconsistent with or less stringent than the uniform standards for calculating contract specific goals established by the Business Enterprise Program. Each State agency that is subject to this Act and each public institution of higher education that is subject to this Act may, in accordance with the provisions of this Act, set goals concerning participation in State contracts, including State construction contracts, to which the State agency or public institution of higher education is party. Goals involving State contracts above the small purchase threshold, as defined in Section 20-20 of the Illinois Procurement Code, may be submitted to the Business Enterprise Program for approval, denial, or modification.

(c) Each State agency and public institution of higher education subject to the requirements of this Act shall, on an annual basis, submit a report to the Council detailing its plan to meet the aspirational contract goals established under this Act and established for that agency, institution or department. As used in this Section, the terms "State contract" and "State construction contract" do not include grants from State agencies to grantees for capital improvements or operational expenses.

(Source: P.A. 103-865, eff. 1-1-25.)

(30 ILCS 575/5) (from Ch. 127, par. 132.605)

(Section scheduled to be repealed on June 30, 2029)

Sec. 5. Business Enterprise Council.

(1) To help implement, monitor, and enforce the goals of this Act, there is created the Business Enterprise Council for Minorities, Women, and Persons with Disabilities, hereinafter referred to as the Council, composed of the Chairperson of the Commission on Equity and Inclusion, the Secretary of Human Services and the Directors of the Department of Human Rights, the Department of Commerce and Economic Opportunity, the Department of Central Management Services, the Department of Transportation and the Capital Development Board, or their duly appointed representatives, with the Comptroller, or his or her designee, serving as an advisory member of the Council. Ten individuals representing businesses that are minority-owned, women-owned, or owned by persons with disabilities, 2 individuals representing the business community, and a representative of public institutions of higher education shall be appointed by the Governor. These members shall serve 2-year terms and shall be eligible for reappointment. Any vacancy occurring on the Council shall also be filled by the Governor. Any member appointed to fill a vacancy occurring prior to the expiration of the term for which his or her predecessor was appointed shall be appointed for the remainder of such term. Members of the Council shall serve without compensation but shall be reimbursed for any ordinary and necessary expenses incurred in the performance of their duties.

The Chairperson of the Commission shall serve as the Council chairperson and shall select, subject to approval of the Council, a Secretary responsible for the operation of the program who shall serve as the Division Manager of the Business Enterprise for Minorities, Women, and Persons with Disabilities Division of the Commission on Equity and Inclusion.

The Director of each State agency and the chief executive officer of each public institution of higher education shall appoint a liaison to the Council. The liaison shall be responsible for submitting to the Council any reports and documents necessary under this Act.

(2) The Council's authority and responsibility shall be to:

(a) Devise a certification procedure to assure that businesses taking advantage of this Act are legitimately classified as businesses owned by minorities, women, or persons with disabilities and a registration procedure to recognize, without additional evidence of Business Enterprise Program eligibility, the certification of businesses owned by minorities, women, or persons with disabilities certified by the City of Chicago, Cook County, or other jurisdictional programs with requirements and procedures equaling or exceeding those in this Act.

(b) Maintain a list of all businesses legitimately classified as businesses owned by minorities, women, or persons with disabilities to provide to State agencies and public institutions of higher education.

(c) Review rules and regulations for the implementation of the program for businesses owned by minorities, women, and persons with disabilities.

(d) Review compliance plans submitted by each State agency and public institution of higher education pursuant to this Act.

(e) Make annual reports as provided in Section 8f to the Governor and the General Assembly on the status of the program.

(f) Serve as a central clearinghouse for information on State contracts, including the maintenance of a list of all pending State contracts upon which businesses owned by minorities, women, and persons with disabilities may bid. At the Council's discretion, maintenance of the list may include 24-hour electronic access to the list along with the bid and application information.

(g) Establish a toll-free telephone number to facilitate information requests concerning the certification process and pending contracts.

(h) Adopt a procedure to grant automatic certification to businesses holding a certification from at least one of the following entities: (i) the Illinois Unified Certification Program; (ii) the Women's Business Development Center in Chicago; (iii) the Chicago Minority Supplier Development Council; or (iv) any other similar entity offering such certification to businesses.

(i) Develop and maintain a repository for non-certified vendors that: (i) have applied for certification and have been denied; (ii) have started, but not completed, the certification process; (iii) have achieved certification, but did not seek renewal; or (iv) are known businesses owned by minorities, women, or persons with disabilities.

(3) No premium bond rate of a surety company for a bond required of a business owned by a minority, woman, or person with a disability bidding for a State contract shall be higher than the lowest rate charged by that surety company for a similar bond in the same classification of work that would be written for a business not owned by a minority, woman, or person with a disability.

(4) Any Council member who has direct financial or personal interest in any measure pending before the Council shall disclose this fact to the Council and refrain from participating in the determination upon such measure.

(5) The Secretary shall have the following duties and responsibilities:

(a) To be responsible for the day-to-day operation of the Council.

(b) To serve as a coordinator for all of the State's programs for businesses owned by minorities, women, and persons with disabilities and as the information and referral center for all State initiatives for businesses owned by minorities, women, and persons with disabilities.

(c) To establish an enforcement procedure whereby the Council may recommend to the appropriate State legal officer that the State exercise its legal remedies which shall include (1) termination of the contract involved, (2) prohibition of participation by the respondent in State contracts for a period not to exceed 3 years, (3) imposition of damages in the amount of the discrepancy between the commitment contained in the utilization plan, as such amount may be amended over the term of the contract, and the qualifying payments made to the eligible certified vendors listed in the utilization plan a penalty not to exceed any profit acquired as a result of violation, or (4) any combination thereof. Such procedures shall require prior approval by Council. All funds collected as penalties under this subsection shall be used exclusively for maintenance and further development of the Business Enterprise Program and encouragement of participation in State procurement by minorities, women, and persons with disabilities.

(d) To devise appropriate policies, regulations, and procedures for including participation by businesses owned by minorities, women, and persons with disabilities as prime contractors, including, but not limited to: (i) encouraging the inclusions of qualified businesses owned by minorities, women, and persons with disabilities on solicitation lists, (ii) investigating the potential of blanket bonding programs for small construction jobs, and (iii) investigating and making recommendations concerning the use of the sheltered market process.

(e) To devise procedures for the waiver of the participation goals in appropriate circumstances.

(f) To accept donations and, with the approval of the Council or the Chairperson of the Commission on Equity and Inclusion, grants related to the purposes of this Act; to conduct seminars related to the purpose of this Act and to charge reasonable registration fees; and to sell directories, vendor lists, and other such information to interested parties, except that forms necessary to become eligible for the program shall be provided free of charge to a business or individual applying for the Business Enterprise Program.

(Source: P.A. 102-29, eff. 6-25-21; 102-558, eff. 8-20-21; 102-721, eff. 1-1-23; 103-865, eff. 1-1-25.)

(30 ILCS 575/7) (from Ch. 127, par. 132.607)

(Section scheduled to be repealed on June 30, 2029)

Sec. 7. Exemptions; waivers; publication of data.

(1) Individual contract exemptions. The Council, at the written request of the affected agency, public institution of higher education, or recipient of a grant or loan of State funds of $250,000 or more complying with Section 45 of the State Finance Act, may permit an individual contract or contract package, (related contracts being bid or awarded simultaneously for the same project or improvements) be made wholly or partially exempt from State contracting goals for businesses owned by minorities, women, and persons with disabilities prior to the advertisement for bids or solicitation of proposals whenever there has been a determination, reduced to writing and based on the best information available at the time of the determination, that there is an insufficient number of businesses owned by minorities, women, and persons with disabilities to ensure adequate competition and an expectation of reasonable prices on bids or proposals solicited for the individual contract or contract package in question. Any such exemptions shall be given by the Council to the Bureau on Apprenticeship Programs and Clean Energy Jobs.

(a) Written request for contract exemption. A written request for an individual contract exemption must include, but is not limited to, the following:

(i) a list of eligible businesses owned by minorities, women, and persons with disabilities;

(ii) a clear demonstration that the number of eligible businesses identified in subparagraph (i) above is insufficient to ensure adequate competition;

(iii) the difference in cost between the contract proposals being offered by businesses owned by minorities, women, and persons with disabilities and the agency or public institution of higher education's expectations of reasonable prices on bids or proposals within that class; and

(iv) a list of eligible businesses owned by minorities, women, and persons with disabilities that the contractor has used in the current and prior fiscal years.

(b) Determination. The Council's determination concerning an individual contract exemption must consider, at a minimum, the following:

(i) the justification for the requested exemption, including whether diligent efforts were undertaken to identify and solicit eligible businesses owned by minorities, women, and persons with disabilities;

(ii) the total number of exemptions granted to the affected agency, public institution of higher education, or recipient of a grant or loan of State funds of $250,000 or more complying with Section 45 of the State Finance Act that have been granted by the Council in the current and prior fiscal years; and

(iii) the percentage of contracts awarded by the agency or public institution of higher education to eligible businesses owned by minorities, women, and persons with disabilities in the current and prior fiscal years.

(2) Class exemptions.

(a) Creation. The Council, at the written request of the affected agency or public institution of higher education, may permit an entire class of contracts be made exempt from State contracting goals for businesses owned by minorities, women, and persons with disabilities whenever there has been a determination, reduced to writing and based on the best information available at the time of the determination, that there is an insufficient number of qualified businesses owned by minorities, women, and persons with disabilities to ensure adequate competition and an expectation of reasonable prices on bids or proposals within that class. Any such exemption shall be given by the Council to the Bureau on Apprenticeship Programs and Clean Energy Jobs.

(a-1) Written request for class exemption. A written request for a class exemption must include, but is not limited to, the following:

(i) a list of eligible businesses owned by minorities, women, and persons with disabilities;

(ii) a clear demonstration that the number of eligible businesses identified in subparagraph (i) above is insufficient to ensure adequate competition;

(iii) the difference in cost between the contract proposals being offered by eligible businesses owned by minorities, women, and persons with disabilities and the agency or public institution of higher education's expectations of reasonable prices on bids or proposals within that class; and

(iv) the number of class exemptions the affected agency or public institution of higher education requested in the current and prior fiscal years.

(a-2) Determination. The Council's determination concerning class exemptions must consider, at a minimum, the following:

(i) the justification for the requested exemption, including whether diligent efforts were undertaken to identify and solicit eligible businesses owned by minorities, women, and persons with disabilities;

(ii) the total number of class exemptions granted to the requesting agency or public institution of higher education that have been granted by the Council in the current and prior fiscal years; and

(iii) the percentage of contracts awarded by the agency or public institution of higher education to eligible businesses owned by minorities, women, and persons with disabilities the current and prior fiscal years.

(b) Limitation. Any such class exemption shall not be permitted for a period of more than one year at a time.

(3) Waivers. Where a particular contract requires a vendor to meet a goal established pursuant to this Act, the vendor shall have the right to request a waiver from such requirements prior to the contract award. The Business Enterprise Program shall evaluate a vendor's request for a waiver based on the vendor's documented good faith efforts to meet the contract-specific Business Enterprise Program goal. The Council may shall grant the waiver when the contractor demonstrates that there has been made a good faith effort to comply with the goals for participation by businesses owned by minorities, women, and persons with disabilities. Any such waiver may shall also be transmitted in writing to the Bureau on Apprenticeship Programs and Clean Energy Jobs.

(a) Request for waiver. A vendor's request for a waiver under this subsection (3) must include, but is not limited to, the following:

(i) a list of eligible businesses owned by minorities, women, and persons with disabilities that pertain to the the class of contracts in the requested waiver that were contacted by the vendor. Eligible businesses are only eligible if the business is certified for the products or work advertised in the solicitation or bid;

(ii) (blank);

(iia) a clear demonstration that the vendor selected portions of the work to be performed by certified vendors to facilitate meeting the contract specific goal, and that certified vendors that have the capability to perform the work of the contract were solicited through all reasonable and available means;

(iib) documentation demonstrating that certified vendors are not rejected as being unqualified without sound reasons based on a thorough investigation of their capabilities. The certified vendor's standing within its industry, membership in specific groups, organizations, or associations, and political or social affiliations are not legitimate causes for rejecting or not contacting or negotiating with a certified vendor;

(iic) proof that the prime vendor solicited eligible certified vendors with: (1) sufficient time to respond; (2) adequate information about the scope, specifications, and requirements of the solicitation or bid, including plans, drawings, and addenda, to allow eligible businesses an opportunity to respond to the solicitation or bid; and (3) sufficient follow up with certified vendors;

(iid) a clear demonstration that the prime vendor communicated with certified vendors;

(iie) evidence that the prime vendor negotiated with certified vendors to enter into subcontracts to provide a commercially useful function of the contract for a reasonable cost;

(iii) documentation demonstrating that the difference in cost between the contract proposals being offered by certified vendors is excessive or unreasonable;

(iv) a list of certified vendors owned by minorities, women, and persons with disabilities that the contractor has used in the current and prior fiscal years;

(v) documentation demonstrating that the vendor made efforts to utilize certified vendors despite the ability or desire of a vendor to perform the work with its own operations by selecting portions of the work to be performed by certified vendors, which may, when appropriate, include breaking out portions of the work to be performed into economically feasible units to facilitate certified vendor participation; and

(vi) documentation that the vendor used the services of: (1) the State; (2) organizations or contractors' groups representing or composed of minorities, women, or persons with disabilities; (3) local, State, or federal assistance offices representing or assisting minorities, women, or persons with disabilities; and (4) other organizations that provide assistance in the recruitment and engagement of certified vendors.

If any of the information required under this subdivision (a) is not available to the vendor, despite the vendor's good faith efforts to obtain the information, the vendor's request for a waiver must contain a written explanation of why that information is not included.

(b) Determination. The Council's determination concerning waivers must include following:

(i) the justification for the requested waiver, including whether the requesting vendor made a good faith effort to identify and solicit certified vendors based on the criteria set forth in this Section;

(ii) the total number of waivers the vendor has been granted by the Council in the current and prior fiscal years;

(iii) (blank); and

(iv) the vendor's use of businesses owned by minorities, women, and persons with disabilities in the current and prior fiscal years.

(3.5) (Blank).

(4) Conflict with other laws. In the event that any State contract, which otherwise would be subject to the provisions of this Act, is or becomes subject to federal laws or regulations which conflict with the provisions of this Act or actions of the State taken pursuant hereto, the provisions of the federal laws or regulations shall apply and the contract shall be interpreted and enforced accordingly.

(5) Each chief procurement officer, as defined in the Illinois Procurement Code, shall maintain on his or her official Internet website a database of the following: (i) waivers granted under this Section with respect to contracts under his or her jurisdiction; (ii) a State agency or public institution of higher education's written request for an exemption of an individual contract or an entire class of contracts; and (iii) the Council's written determination granting or denying a request for an exemption of an individual contract or an entire class of contracts. The database, which shall be updated periodically as necessary, shall be searchable by contractor name and by contracting State agency.

(6) Each chief procurement officer, as defined by the Illinois Procurement Code, shall maintain on its website a list of all vendors that have been prohibited from bidding, offering, or entering into a contract with the State of Illinois as a result of violations of this Act.

Each public notice required by law of the award of a State contract shall include for each bid or offer submitted for that contract the following: (i) the bidder's or offeror's name, (ii) the bid amount, (iii) the name or names of the certified vendors identified in the bidder's or offeror's submitted utilization plan, and (iv) the percentage of the contract awarded to each certified vendor that is a business owned by minorities, women, and persons with disabilities identified in the utilization plan.

(Source: P.A. 102-29, eff. 6-25-21; 102-662, eff. 9-15-21; 103-570, eff. 1-1-24.)

(30 ILCS 575/8) (from Ch. 127, par. 132.608)

(Section scheduled to be repealed on June 30, 2029)

Sec. 8. Enforcement.

(1) The Commission on Equity and Inclusion shall make such findings, recommendations and proposals to the Governor as are necessary and appropriate to enforce this Act. If, as a result of its monitoring activities, the Commission determines that its goals and policies are not being met by any State agency or public institution of higher education, the Commission may recommend any or all of the following actions:

(a) Establish enforcement procedures whereby the Commission may recommend to the appropriate State agency, public institutions of higher education, or law enforcement officer that legal or administrative remedies be initiated for violations of contract provisions or rules issued hereunder or by a contracting State agency or public institutions of higher education. State agencies and public institutions of higher education shall be authorized to adopt remedies for such violations which shall include (1) termination of the contract involved, (2) prohibition of participation of the respondents in public contracts for a period not to exceed one year, (3) the assessment of damages in the amount of the discrepancy between the commitment contained in the utilization plan, as such amount may be amended over the term of the contract, and the qualifying payments made to the certified vendors listed in the utilization plan imposition of a penalty not to exceed any profit acquired as a result of violation, or (4) any combination thereof.

(b) If the Commission concludes that a compliance plan submitted under Section 6 is unlikely to produce the participation goals for businesses owned by minorities, women, and persons with disabilities within the then current fiscal year, the Commission may recommend that the State agency or public institution of higher education revise its plan to provide additional opportunities for participation by businesses owned by minorities, women, and persons with disabilities. Such recommended revisions may include, but shall not be limited to, the following:

(i) assurances of stronger and better focused solicitation efforts to obtain more businesses owned by minorities, women, and persons with disabilities as potential sources of supply;

(ii) division of the scope of work, when economically feasible, into tasks or quantities to permit participation of businesses owned by minorities, women, and persons with disabilities;

(iii) elimination of extended experience or capitalization requirements, when programmatically feasible, to permit participation of businesses owned by minorities, women, and persons with disabilities;

(iv) identification of specific proposed contracts as particularly attractive or appropriate for participation by businesses owned by minorities, women, and persons with disabilities, such identification to result from and be coupled with the efforts of subparagraphs (i) through (iii);

(v) implementation of those regulations established for the use of the sheltered market process.

(2) State agencies and public institutions of higher education shall monitor a vendor's compliance with its utilization plan and the terms of its contract. Without limitation, a vendor's failure to comply with its contractual commitments as contained in the utilization plan; failure to cooperate in providing information regarding its compliance with its utilization plan; or the provision of false or misleading information or statements concerning compliance, certification status, or eligibility of the Business Enterprise Program-certified vendor, good faith efforts, or any other material fact or representation shall constitute a material breach of the contract and entitle the State agency or public institution of higher education to declare a default, terminate the contract, or exercise those remedies provided for in the contract, at law, or in equity.

(3) Prior to the expiration or termination of a contract, State agencies and public institutions of higher education shall evaluate the contractor's fulfillment of the contract goals for participation by certified businesses owned by minorities, women, and persons with disabilities. The agency or public institution of higher education shall prepare a report of the vendor's compliance with the contract goals and file it with the Secretary. If the Secretary determines that the vendor did not fulfill the contract goals, the vendor shall be in breach of the contract and may be subject to remedies or sanctions, unless the vendor can show that it made good faith efforts to meet the contract goals. Such remedies or sanctions for failing to make good faith efforts may include (i) disqualification of the contractor from doing business with the State for a period of no more than one year, or (ii) cancellation, without any penalty to the State, of any contract entered into by the vendor, or (iii) the assessment of damages in the amount of the discrepancy between the commitment contained in the utilization plan, as such amount may be amended over the term of the contract, and the qualifying payments made to the certified vendors listed in the utilization plan.

The Business Enterprise Program shall develop procedures for determining whether a vendor has made good faith efforts to meet the contract goals upon the expiration or termination of a contract, which may include, but shall not be limited to consideration of: (i) whether State or local action caused a shortfall, such as a change in the scope of work that eliminated work to be performed by certified vendors or a change in specifications; (ii) whether the vendor was unable to obtain certified business participation without requiring the introduction of extra participants not performing a commercially useful function; or (iii) whether the vendor made efforts to use appropriate forums for purposes of advertising subcontracting opportunities suitable for certified businesses.

(Source: P.A. 102-29, eff. 6-25-21; 103-865, eff. 1-1-25.)