As used in this part 5, unless the context otherwise requires:
(1) Contract means any type of state agreement, regardless of what it may be called, for the acquisition of services.
(2) Personal services means services acquired for the state's direct benefit in its operations.
(3) Purchased services means the acquisition of services which directly benefit specific groups or individuals in the public at large as defined by law, from public or private entities licensed, certified, or otherwise authorized by statute to provide such services.
(4) Services means the furnishing of labor, time, or effort.
Source: L. 93: Entire part added, p. 281, � 1, effective April 7.
24-50-503. Personal services contracts implicating state personnel system - no separation of existing classified employees. (1) Contracts for personal services that create an independent contractor relationship and that are not authorized under the provisions of section 24-50-504 are nevertheless permissible under this section to achieve increased efficiency in the delivery of government services when the state personnel director determines that all of the following conditions are met:
(a) The contracting agency clearly demonstrates that the proposed contract will result in overall cost savings to the state and that the estimated savings will not be eliminated by contractor rate increases during the term of the contract, subject to the following:
(I) In comparing costs, there shall be included the state's cost of providing the same service as proposed by a contractor. The state's costs shall include the salaries and benefits of staff that would be needed and the cost of space, equipment, and material needed to perform the function.
(II) In comparing costs, there shall not be included the state's indirect overhead costs unless the costs can be attributed solely to the function in question and would not exist if that function were not performed in state service. For such purpose, Indirect overhead costs means the pro rata share of existing administrative salaries and benefits, rent, equipment costs, utilities, and materials.
(III) In comparing costs, there shall be included in the cost of a contractor providing a service any continuing state costs that would be directly associated with the contracted function. These continuing state costs shall include, but need not be limited to, those for inspection, supervision, and monitoring.
(IV) In comparing costs, there shall not be included any savings to the state attributable to lower health insurance benefits provided by the contractor.
(b) The contracting agency clearly demonstrates that the proposed contract will provide at least the same quality of services as that offered by the contracting agency.
(c) The contract includes specific provisions pertaining to the qualifications of the staff that will perform the work under the contract.
(d) The contract contains nondiscrimination provisions required by law to be included in state contracts.
(e) The contract contains provisions for termination by the state for breach of the contract by the contractor.
(f) The potential economic advantage of contracting is not outweighed by the public's interest in having a particular function performed directly by state government. In assessing the public's interest, the state personnel director shall take into account:
(I) The consequences and potential mitigation of improper or failed performance by the contractor;
(II) Whether performance of the contract involves the improper delegation of a policy-making function;
(III) The extent to which the contracting preserves the principles of competence in government and the avoidance of political patronage. For such purpose, there shall be considered the applicability of other laws, including those as enumerated in section 24-50-506, that aid in safeguarding the fundamental principles underlying the state personnel system.
(2) The state personnel director shall not approve a personal services contract under this section if the contract would result directly or indirectly in the separation of certified employees from state service. However, nothing contained in this section shall be construed to prevent the separation of certified employees from state service pursuant to any other provision of law, including but not limited to the provisions of section 24-50-124, for reasons other than privatization.
(3) Repealed.
Source: L. 93: Entire part added, p. 281, � 1, effective April 7. L. 95: (1)(f)(III) amended, p. 145, � 1, effective April 7. L. 2011: (3) added, (HB 11-1201), ch. 139, p. 484, � 3, effective May 4.
Editor's note: Subsection (3)(b) provided for the repeal of subsection (3), effective July 1, 2014. (See L. 2011, p. 484.)
24-50-504. Personal services contracts not implicating state personnel system. (1) Personal services contracts for employees or independent contractors are permissible when the functions contracted are otherwise performed by persons exempt from civil service by section 13 of article XII of the state constitution or by statutes enacted pursuant thereto.
(2) Personal services contracts that create an independent contractor relationship are permissible when the state personnel director determines that any of the following conditions are met:
(a) The contract is for an existing state program that has never been performed by employees in the state personnel system, or the contract is for an existing state program that involves duties similar to duties currently or previously performed by classified employees but the contracted program is different in scope or policy objectives from the programs carried out by such classified employees. For the purposes of this paragraph (a), an existing state program is a state program that was in effect and performed by contract prior to April 7, 1993.
(b) The contract is for a new state program, and the general assembly has statutorily authorized the performance of the program by independent contractors. A program is not a new state program within the meaning of this paragraph (b) solely because it is performed at a new facility or location.
(c) The services contracted are not available within the state personnel system, cannot be performed satisfactorily by employees of the state personnel system, or are of such a highly specialized or technical nature that the necessary expert knowledge, experience, and ability are not available through the state personnel system.
(d) The services are incidental to a contract for the purchase or lease of real or personal property. Contracts under this criterion, known as service agreements, include, but are not limited to, agreements to service or maintain equipment, computers, or other products that are entered into in connection with their original lease or purchase.
(e) The legislative, administrative, or legal goals and purposes cannot be accomplished through the utilization of persons selected pursuant to the state personnel system. Contracts are permissible under this criterion to protect against a conflict of interest or to ensure independent and unbiased findings in cases where there is a clear need for a different, outside perspective. These contracts include, but are not limited to, obtaining expert witnesses in litigation.
(f) The contractor will provide equipment, materials, facilities, or support services that could not feasibly be provided by the state in the location where the services are to be performed.
(g) The contractor will conduct training courses for which appropriately qualified state personnel system instructors are not available.
(h) The services are of an urgent, temporary, or occasional nature.
(3) Contracts for purchased services, as determined by the state personnel director, that create an independent contractor relationship are permissible.
Source: L. 93: Entire part added, p. 283, � 1, effective April 7.
24-50-504.7. Commission on the privatization of personal services - creation. (Repealed)
Source: L. 96: Entire section added, p. 1306, � 2, effective August 7.
Editor's note: Subsection (2) provided for the repeal of this section, effective November 1, 1997. (See L. 96, p. 1306.)