SB2653 104TH GENERAL ASSEMBLY

LRB104 09811 HLH 22568 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB2653

Introduced 4/25/2025, by Sen. Cristina Castro

SYNOPSIS AS INTRODUCED:

30 ILCS 575/3.5
30 ILCS 575/4	from Ch. 127, par. 132.604
30 ILCS 575/7	from Ch. 127, par. 132.607
30 ILCS 575/8g

Amends the Business Enterprise for Minorities, Women, and Persons with Disabilities Act. Provides that the Business Enterprise Program shall (currently, may) establish uniform standards for calculating contract specific Business Enterprise Program goals for all State contracts and State construction contracts subject to the Act. Removes language providing that the dollar amount of certain contracts is defined by the Secretary of the Business Enterprise Council for Minorities, Women, and Persons with Disabilities and approved by the Council. Provides that the Business Enterprise Council for Minorities, Women, and Persons with Disabilities may permit, on its own initiative, an entire class of contracts to be exempt from State contracting goals for businesses owned by minorities, women, and persons with disabilities if there has been a written 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 the class. Makes changes concerning deficiencies in utilization plans that may be cured.

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, 4, 7, and 8g 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. 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) Each State agency that is subject to this Act and each public institution of higher education that is subject to this Act shall 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, shall may be submitted to the Business Enterprise Program for approval, denial, or modification.

(c) 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 575/4) (from Ch. 127, par. 132.604)

(Section scheduled to be repealed on June 30, 2030)

Sec. 4. Award of State contracts.

(a) Except as provided in subsection (b), not less than 30% of the total dollar amount of State contracts, as defined by the Secretary of the Council and approved by the Council, shall be established as an aspirational goal to be awarded to businesses owned by minorities, women, and persons with disabilities; provided, however, that of the total amount of all State contracts awarded to businesses owned by minorities, women, and persons with disabilities pursuant to this Section, contracts representing at least 16% shall be awarded to businesses owned by minorities, contracts representing at least 10% shall be awarded to women-owned businesses, and contracts representing at least 4% shall be awarded to businesses owned by persons with disabilities.

(a-5) In addition to the aspirational goals in awarding State contracts set under subsection (a), the Commission shall by rule further establish targeted efforts to encourage the participation of businesses owned by minorities, women, and persons with disabilities on State contracts. Such efforts shall include, but not be limited to, further concerted outreach efforts to businesses owned by minorities, women, and persons with disabilities.

The above percentage relates to the total dollar amount of State contracts during each State fiscal year, calculated by examining independently each type of contract for each agency or public institutions of higher education which lets such contracts. Only that percentage of arrangements which represents the participation of businesses owned by minorities, women, and persons with disabilities on such contracts shall be included. State contracts subject to the requirements of this Act shall include the requirement that only expenditures to businesses owned by minorities, women, and persons with disabilities that perform a commercially useful function may be counted toward the goals set forth by this Act. Contracts shall include a definition of "commercially useful function" that is consistent with 49 CFR 26.55(c).

(b) Not less than 20% of the total dollar amount of State construction contracts is established as an aspirational goal to be awarded to businesses owned by minorities, women, and persons with disabilities; provided that, contracts representing at least 11% of the total dollar amount of State construction contracts shall be awarded to businesses owned by minorities; contracts representing at least 7% of the total dollar amount of State construction contracts shall be awarded to women-owned businesses; and contracts representing at least 2% of the total dollar amount of State construction contracts shall be awarded to businesses owned by persons with disabilities.

(c) (Blank).

(c-5) All goals established under this Section shall be contingent upon the results of the most recent disparity study conducted by the State.

(d) By December 31, 2028, the Commission on Equity and Inclusion shall conduct a new social scientific study that measures the impact of discrimination on minority and women business development in Illinois. By June 30, 2029, the Commission shall issue a report of its findings and any recommendations on whether to adjust the goals for minority and women participation established in this Act. Copies of this report and the social scientific study shall be filed with the Governor and the General Assembly. By December 31, 2029, the Commission on Equity and Inclusion Business Enterprise Program shall develop a model for social scientific disparity study sourcing for local governmental units to adapt and implement to address regional disparities in public procurement.

(e) All State contract solicitations that include Business Enterprise Program participation goals shall require bidders or offerors to include utilization plans. Utilization plans are due at the time of bid or offer submission. Failure to complete and include a utilization plan, including documentation demonstrating good faith efforts when requesting a waiver, shall render the bid or offer non-responsive.

Except as permitted under this Act or as otherwise mandated by federal regulation, a bidder or offeror whose bid or offer is accepted and who included in that bid a completed utilization plan but who fails to meet the goals set forth in the plan shall be notified of the deficiency by the contracting agency or public institution of higher education and shall be given a period of 10 business calendar days to cure the deficiency by contracting with additional subcontractors who are certified by the Business Enterprise Program or by increasing the work to be performed by previously identified vendors certified by the Business Enterprise Program.

Deficiencies that may be cured include, but are not limited to: (i) failure to contract with sufficient subcontractors that are certified by the Business Enterprise Program to meet the stated contract goals; (ii) failure to allocate sufficient work to be performed by previously identified subcontractors certified by the Business Enterprise Program to meet the stated contract goals; (iii) mistakes in the utilization plan, such as scrivener's errors, such as transposed numbers; (ii) information submitted in an incorrect form or format, and ; (iii) mistakes resulting from failure to follow instructions or to identify and adequately document good faith efforts taken to comply with the utilization plan; or (iv) a proposal to use a firm whose Business Enterprise Program certification has lapsed or is not yet recognized. Cure is not authorized if the bidder or offeror submits a blank utilization plan, a utilization plan that shows a lack of reasonable effort to complete the form on time, or a utilization plan that states the contract will be self-performed, by a non-certified vendor, without showing good faith efforts or a request for a waiver. All cure activity shall address the deficiencies identified by the purchasing agency or public institution of higher education and shall require clear documentation, including that of good faith efforts, to address those deficiencies. Any increase in cost to a contract for the addition of a subcontractor to cure a bid's deficiency shall not affect the bid price and shall not be used in the request for an exemption under this Act, and, in no case, shall an identified subcontractor with a Business Enterprise Program certification made under this Act be terminated from a contract without the written consent of the State agency or public institution of higher education entering into the contract. The purchasing agency or public institution of higher education shall make the determination whether the cure is adequate.

Vendors certified with the Business Enterprise Program at the time and date submittals are due and who do not submit a utilization plan or have utilization plan deficiencies shall have 10 business days to submit a utilization plan or to correct the utilization plan deficiencies.

(f) (Blank).

(g) (Blank).

(h) State agencies and public institutions of higher education shall notify the Commission on Equity and Inclusion of all non-responsive bids or proposals for State contracts deemed non-responsive due to deficient utilization plan submissions.

(Source: P.A. 102-29, eff. 6-25-21; 102-558, eff. 8-20-21; 102-1119, eff. 1-23-23; 103-961, eff. 8-9-24.)

(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, on its own initiative, or 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 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 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.

(c) Waivers after contract execution. If 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 that requirement after the contract award if no BEP-certified vendor is available to replace a non-performing BEP-certified vendor.

(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 575/8g)

(Section scheduled to be repealed on June 30, 2030)

Sec. 8g. Business Enterprise Program Council reports.

(a) The Commission on Equity and Inclusion shall provide a report to the Council identifying all State agency non-construction solicitations that exceed $20,000,000 and that have less than a 30% 20% established goal prior to publication.

(b) The Commission on Equity and Inclusion shall provide a report to the Council identifying all State agency non-construction awards that exceed $20,000,000. The report shall contain the following: (i) the name of the awardee; (ii) the total bid amount; (iii) the established Business Enterprise Program goal; (iv) the dollar amount and percentage of participation by businesses owned by minorities, women, and persons with disabilities; and (v) the names of the certified firms identified in the utilization plan.

(Source: P.A. 103-961, eff. 8-9-24.)