A bill the University of Hawaii athletic department says will save it at least $100,000 a year by exempting it from the state procurement code was unanimously forwarded by the House Committee on Labor & Public Employment on Tuesday.
House Bill 520 would reinstate an exemption the athletic department held in the late 1990s but lost in a universitywide changeover in the early 2000s.
Athletic director David Matlin told lawmakers it would apply only to goods and services purchased with department-generated funds. He said it would help address needs in team travel and equipment where UH often deals with mainland suppliers who do not regularly do business in Hawaii and are reluctant to go through the process of obtaining the necessary certificate of compliance from the state.
He cited an example of bidding for track equipment that ended up costing the department $3,411 more because the winning bidder, “opted not to pursue obtaining a certificate and, as a result, the team was required to purchase the equipment from the next bidder” at the higher cost.
Sarah Allen, Administrator of the State Procurement Office, opposed the bill in written testimony, saying, “The Hawaii Public Procurement Code is the single source of public procurement policy to be applied equally and uniformly, while providing fairness, open competition, a level playing field, government disclosure and transparency in the procurement and contracting process vital to good government.”
Allen wrote, “Exemptions to the code mean that all procurements made with taxpayer monies from (UH athletics) will not have the same oversight, accountability and transparency requirements mandated by those procurements processes provided in the code. It means that there is no requirement for due diligence, proper planning or consideration of protections for the state in contract terms and conditions, nor are there any set requirements to conduct cost and price analysis and market research or post-award contract management. As such, agencies can choose whether to compete any procurement or go directly to one contractor …”
Matlin said two levels of department approval are required for use of all funds and anything over $10,000 requires his approval while amounts above $25,000 also require approval of the Manoa Chancellor.
