Section 30.5  Introduction

 

The Business Enterprise for Minorities, Females, and Persons with Disabilities Act [30 ILCS 575] (Act) establishes a goal that at least 20% of contracts awarded by State agencies subject to the Act be awarded to businesses owned and controlled by minorities, females, or persons with disabilities.  The Act also authorizes development and use of a procedure to certify firms eligible for the benefits of the Act, allows for certain special treatment in contracting with certified businesses, and establishes a Council, Secretary and, in the Department of Central Management Services, a program function to implement and oversee the Act.

 

(Recodified from Section 10.5 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.10  Definitions

 

"Act" means the Business Enterprise for Minorities, Females, and Persons with Disabilities Act [30 ILCS 575].

 

"Department" means the Illinois Department of Central Management Services.

 

"BEP" or "Business Enterprise Program" means the activities conducted by the Council, Secretary and Department of Central Management Services pursuant to the Act.

 

"BEP Eligible" or "BEP Eligible Vendor" means an MBE, FBE or PBE.

 

"Council" means the public body established by the Act to implement and oversee implementation of the Business Enterprise Program.

 

"Eligible Group Member" means a person who meets the eligibility requirements set forth in Section 30.40(a).

 

"FBE" means a business owned and controlled by females in accordance with the requirements of the Act and this Part.

 

"MBE" means a business owned and controlled by minorities in accordance with the requirements of the Act and this Part.

 

"PBE" means a business owned and controlled by persons with disabilities in accordance with the requirements of the Act and this Part.

 

"Public Institutions of Higher Education" has the meaning provided in Section 2(A)(7) of the Act.

 

"Racial, Gender or Disability-Based Discrimination" means specific, documented instances of racial, gender or disability-based bias in the utilization of FBE, MBE or PBE businesses for State contracts compared to the availability of these businesses in the market. Generalized allegations of societal and/or industry discrimination are not sufficient, on their own, to satisfy this standard.

 

"Secretary" means the individual appointed to act as Secretary to the Council and to be manager of the BEP Division of the Department of Central Management Services.

 

"Sheltered Market" means a procurement procedure in which certain State contracts are selected for businesses owned and controlled by minorities, females, and persons with disabilities on a competitive bid or negotiated basis [30 ILCS 575/8b].

 

"State Agency" has the meaning provided by Section 2(A)(6) of the Act.

 

"State Contract" has the meaning provided by Section 2(A)(5) of the Act.

 

(Recodified from Section 10.10 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART B: GOAL AND GOAL MEASUREMENT

 

Section 30.20  Goal

 

The Council shall, by resolution, establish the contracting goal.  In accordance with the Act, not less than 20% of the total dollar amount of State contracts, as defined in this Part, shall be the goal for awarding contracts to MBEs, FBEs, and PBEs.

 

(Recodified from Section 10.20 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.21  Contracts and Expenditures Subject to the Goal

 

All contracts funded in whole or in part with funds appropriated by the General Assembly are subject to the goal unless exempted elsewhere in this Part.

 

(Recodified from Section 10.21 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.22  Categories of Contracts and Expenditures Exempt from Goal

 

a)         Contracts shall be exempt from the goal if:

 

1)         the contract is subject to federal reimbursement; or

 

2)         receipt of funds for a contract would be jeopardized by including them in the Program.

 

b)         The Council has determined, pursuant to Section 7(2) of the Act, that the following categories of contracts and expenditures, including but not limited to the detailed expenditure accounts listed within each category, are exempt from the goal.  This determination was made based on the best information available that these categories do not represent procurement opportunities for MBEs, FBEs or PBEs, or that there are not sufficient MBEs, FBEs or PBEs to ensure competition and an expectation of reasonable prices.  The detailed expenditure accounts have the same meaning as used by the State Comptroller (see Statewide Accounting Management System manual.  A copy of this manual is available in the Secretary's office).

 

1)         Contracts between, or within, State agencies that do not include payments to private vendors:

 

A)        University Central Data Processing Services;

 

B)        University Central Plant Services;

 

C)        University Central Supply Services;

 

D)        University Central Telecommunication Services; and

 

E)        University Central Transportation Services.

 

2)         Contracts with or payments to other governmental entities:

 

A)        Payments to Local Governments for Employees;

 

B)        Reimbursements to Governmental Units;

 

C)        Postage and Postal Charges;

 

D)        Operating Taxes, Licenses and Fees;

 

E)        Revenue Stamps;

 

F)         Taxes and Transfers;

 

G)        Fire Protection Services;

 

H)        Shared Waterway Agreements; and

 

I)         Shared Revenue Payments.

 

3)         Employee wages, salary and other payroll and employee related costs:

 

A)        Payments into Pension Funds;

 

B)        Pensions, Annuities and Benefits;

 

C)        Purchase of Investments;

 

D)        Employee Tuition Fees;

 

E)        Social Security;

 

F)         Retirement;

 

G)        Unemployment Compensation Payments;

 

H)        Legislative Staff Services;

 

I)         Registration Fees and Conference Expenses;

 

J)         Workers' Compensation Commission Awards or Settlement Awards for Injured Employees; and

 

K)        Awards, Benefits and Treatment Expenses − Injured Employees.

 

4)         Payments of money to individuals or groups in the nature of reimbursement, settlement, entitlement, or assistance:

 

A)        Assistance Payments to Individuals;

 

B)        Awards and Grants to Students;

 

C)        Burial Expense Awards;

 

D)        Community Services for DHS-MH & DD and Chemically Dependent;

 

E)        Court of Claims Awards;

 

F)         Reimbursement for Living Expenses for State Wards Outside State Institutions;

 

G)        Tuition, Training Supplies and Equipment for Aided Persons;

 

H)        Lottery Prizes;

 

I)         Interviewee Expenses; and

 

J)         Tort Claims.

 

5)         Debt retirement and refunds of money:

 

A)        Debt Retirement;

 

B)        Loans; and

 

C)        Refunds.

 

6)         Grants:

 

A)        Grants for Educational Purposes − School Districts;

 

B)        Grants for Educational Purposes − Higher Education;

 

C)        Grants to Local Governments (other);

 

D)        Grants to Non-Profit Organizations;

 

E)        Grants to Other State Agencies; and

 

F)         Grants to or on behalf of Veterans and their Dependents.

 

7)         Public utility contracts and payments:

 

A)        Electricity;

 

B)        Gas (Natural Gas);

 

C)        Telecommunications (regulated service only);

 

D)        Water; and

 

E)        Utilities (Other).

 

8)         Real estate acquisition:

 

A)        Land (Relocation Costs);

 

B)        Land, Relocation Costs (Highways);

 

C)        Land, Relocation Costs (Waterways);

 

D)        Land, Rights of Way and Easements;

 

E)        Land, Rights of Way and Easements (Highway); and

 

F)         Land, Rights of Way and Easements (Waterways).

 

9)         Miscellaneous contracts and expenditures:

 

A)        Association Dues; and

 

B)        Periodical Subscriptions.

 

c)         Prior to the end of each fiscal year, the Secretary shall investigate the categories of contracts and expenditures to determine whether, based on the best information available, these categories continue to represent procurements in which there are no opportunities for MBEs, FBEs or PBEs, or that there are not sufficient MBEs, FBEs or PBEs to ensure competition and an expectation of reasonable prices.  The Secretary shall present the determination to the Council, and the Council shall either continue with the current categories or change the categories.  The categories shall remain as stated in this Part until the Part is amended to change the categories.

 

(Recodified from Section 10.22 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.23  Council Review of Agency Requests for Specific Exemptions

 

a)         Any State agency may request that the Council exempt specific contracts or expenditures from the goal.  The agency must show, based on the best information available, that the particular contract does not represent a procurement opportunity for MBEs, FBEs or PBEs, or that there are not sufficient MBEs, FBEs or PBEs to ensure competition and an expectation of reasonable prices. The agency must provide a copy of any Invitation for Bids, Request for Proposals or other solicitation information issued, the amount of anticipated expenditures that would be exempt and the total agency appropriation.  The documentation must show the agency engaged in a diligent effort to identify and solicit BEP eligible vendors, and the results of that effort.

 

1)         A diligent effort requires, at a minimum, solicitation of appropriate vendors from the master vendor list maintained by the Council and advertising in appropriate media.

 

2)         Whether the price quoted is reasonable shall be determined based upon current market prices, historic prices, prices received by other agencies for similar supplies or services, and the policy of the Business Enterprise Act to promote businesses owned by minorities, females and persons with disabilities.

 

b)         The Council shall exempt specific contracts from the goal if, after reviewing the information provided by the agency, it determines that the agency did make a diligent effort to contract with MBEs, FBEs and PBEs and that the price was not reasonable.  Any action by the Council to approve or deny a request for specific exemption shall be by resolution passed by the Council.

 

(Recodified from Section 10.23 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.24  Goal Measurement

 

a)         The goal shall be measured on a full fiscal year basis.  The goal shall be measured against the total dollar amount of expenditures subject to the goal. Expenditures not covered are those described in Sections 30.22 and 30.23.

 

b)         Each user agency's expenditures, whether against contracts established by the user agency or against contracts established on behalf of a user agency by another agency such as the Department of Central Management Services, shall be included in the user agency's goal attainment statistics.

 

(Recodified from Section 10.24 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.25  Subcontracting

 

An agency may satisfy its goal, in whole or in part, by counting expenditures made by State vendors to certified BEP vendors as subcontractors.

 

(Recodified from Section 10.25 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART C: AGENCY COMPLIANCE AND REPORTING

 

Section 30.30  Agency Compliance

 

a)         Each agency shall submit a compliance plan annually.  The Council shall establish the format and timetable for submission of the plan.  The Council shall approve the plan if it meets the requirements of the Act and this Part.

 

b)         The Council, on its own motion or upon request of a purchasing agency, shall recommend ways in which the purchasing agency may reach its goal. Upon a finding by the Council that a purchasing agency's compliance plan is insufficient to reach the agency's goal, the Council shall recommend ways in which the agency can reach its goal.  Such recommendations may include, but shall not be limited to:

 

1)         using stronger and better focused solicitation efforts to obtain more BEP eligible businesses as potential sources of supply;

 

2)         division of job or project requirements, when economically feasible, into smaller, more manageable, tasks or quantities;

 

3)         elimination of extended experience or capitalization requirements when programmatically feasible; and

 

4)         identification of specific proposed contracts as particularly attractive or appropriate for participation by BEP eligible businesses.

 

c)         If the compliance plans or quarterly reports indicate the agency's goal will not be reached, the Council may request the agency head to appear before the Council and explain the agency's non-compliance.  If the Council determines the agency is not making a serious effort to reach the goal, the Council will prepare a report for submission to the Governor with recommendations for remedial action.

 

(Recodified from Section 10.30 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.35  Professional and Artistic Contract Reporting

 

a)         Agencies shall give written notice to the Secretary of procurement opportunities for professional and artistic services (as defined in Section 1-15.60 of the Illinois Procurement Code and applicable Sections of the Chief Procurement Officer for General Services Standard Procurement Rules, 44 Ill. Adm. Code 1).

 

b)         The notice shall include the agency name and address; contact person; contract reference number; anticipated start date; length of the contract; services to be provided; special requirements; and dollar value.  Notice may be given on the form available from the Secretary. Notice may be mailed, hand delivered, sent by fax, or transmitted in electronic form.

 

c)         Upon receipt of the notice, the Secretary shall have at least 14 days to provide the agency with the names of certified vendors who might be interested in the contract.  The agency shall consider all certified vendors referred by the Secretary within that 14 day period.

 

d)         Notice to the Secretary is not required if the procurement is advertised in the Illinois Procurement Bulletin or if the agency considers all certified vendors that provide the needed service.  Notation to that effect shall be maintained by the agency in its file.

 

(Recodified from Section 10.35 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART D: PROGRAM ELIGIBILITY

 

Section 30.40  Program Eligibility

 

a)         Businesses owned and controlled by individuals in the following eligible groups may submit applications for certification:

 

1)         African American – a person having origins in any of the black racial groups in Africa.

 

2)         Hispanic – a person of Spanish or Portuguese culture with origins in Mexico, South or Central American or the Caribbean (regardless of race).

 

3)         American Indian or Alaskan Native – a person having origins in any of the original people of North America.

 

4)         Asian American – a person having origins in any of the original peoples of the Far East, Southeast Asia, the Indian Subcontinent or the Pacific Islands.

 

5)         Female – a person who is a citizen or lawful, permanent resident of the United States, and who is of the female gender.

 

6)         Person with a disability.

 

b)         MBE, FBE and PBE refer to for-profit enterprises regardless of form of organization (sole proprietorship, partnership or corporation).  However, not-for-profit entities that meet the definition of a sheltered workshop for the disabled in accordance with Section 45-35 of the Illinois Procurement Code [30 ILCS 500] will also be classified as PBE.

 

(Recodified from Section 10.40 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART E: CERTIFICATION

 

Section 30.50  General

 

a)         The certification process verifies that the business is owned and controlled by BEP eligible individuals in accordance with requirements of the Act and this Part. The Secretary to the Council will oversee the certification process.  The certification procedure consists of the requirements and procedures outlined in this Section.

 

b)         The Secretary will certify a business firm that meets the requirements of the Act and this Part.  All certifications, new and existing, shall be valid for a period of 7 years from the effective date of the certification, subject to annual confirmation.

 

c)         Only certified businesses are eligible for the benefits of the Program. Agencies may count only those expenditures with a certified business or certified business subcontractor toward meeting the goal.

 

d)         A business owned and controlled by minority females shall designate whether the business will be certified as FBE or MBE.

 

e)         A business owned and controlled at least 51% by any combination of minorities, females and persons with disabilities shall be counted as a business owned and controlled by the eligible group that has the largest percentage of ownership.  When there is a tie, the business shall select the eligible group classification.

 

f)         A business owned and controlled by a person with a disability, or by an entity that is a not-for-profit agency for the disabled, is a PBE certified business regardless of the ethnicity or gender of the owner or owners, or of the governing board.

 

g)         These classifications facilitate consistent accounting of agency contract awards to businesses covered by the Act.  These classifications do not preclude such businesses or not-for-profit agencies from receiving any contract that may be awarded under the Illinois Procurement Code [30 ILCS 500] or other applicable law.

 

(Recodified from Section 10.50 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.55  Program Information

 

a)         The Secretary, on behalf of the Council, shall compile a list of businesses certified under the Act and may compile and maintain other information regarding the program, including general vendor lists.

 

b)         The list will contain the name, address, telephone and facsimile numbers, e-mail address, type of certification (MBE, FBE or PBE) and business classification (e.g., accounting or furniture sales) of certified businesses.

 

c)         The list shall be available to the Chief Procurement Officers and State Purchasing Officers established under the Illinois Procurement Code, and to other interested State agencies for use in procurements under the Illinois Procurement Code and other procurement laws.

 

d)         The list of certified businesses shall be available to the public.  This list and other information shall be provided electronically via the Business Enterprise Website.  If a hard copy is requested, there shall be a fee to cover cost of compilation, maintenance, publication and distribution.

 

(Recodified from Section 10.55 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART F: CERTIFICATION REQUIREMENTS AND PROCEDURES

 

Section 30.60  Application

 

The business seeking certification must complete a BEP application package. The Secretary may conduct a personal interview with the applicant that may include a telephone interview and/or an on-site visit.  Additional on-site visits may be conducted at any time during the life of a certification to verify continued eligibility for the Program.

 

(Recodified from Section 10.60 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.61  Applicant Requirements

 

The applicant for initial certification, or recertification, must meet all of the requirements set forth in the Act and this Part. Should the applicant fail to meet any of the certification requirements, or refuse to supply information requested by the Secretary, the Secretary will deny certification or recertification.

 

(Recodified from Section 10.61 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.62  Time to Determine Eligibility

 

The Secretary shall contact all applicants seeking certification within 60 days after receipt of the application, and shall grant certification or deny certification.  The Secretary shall contact all applicants regarding any requests for additional or clarifying information within 15 days after receipt of the application.

 

(Recodified from Section 10.62 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.63  Certification by Other Certifying Entities

 

a)         The Council will accept a certification by another entity in Illinois, such as a local government or vendor association.  The other entity must have certification requirements and procedures equaling or exceeding those in the Act and this Part.

 

b)         The Secretary shall investigate requirements and procedures of other certifying entities and shall report to the Council the names of those certifying entities whose certifications can be accepted.

 

1)         The other entities must agree to notify the Secretary should their requirements or procedures change in any material way.  The Secretary shall periodically meet with the other certifying entities to help ensure Council requirements and procedures are being met.

 

2)         If the other entities' requirements or procedures no longer equal or exceed the requirements and procedures of the Act or this Part, the Council will no longer accept those certifications.  However, the Council will continue to honor previously accepted certifications until the Secretary reviews each one and, if necessary, revokes those that do not meet the requirements of the Act and this Part.

 

3)         The other entities must agree to report any denial of certification or recertification to the Council, along with detailed reasons for that action.

 

(Recodified from Section 10.63 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.64  Sales Limitation; Exception

 

a)         Annual gross sales must be less than $75 million, the statutory maximum established by Section 2(A)(10) of the Business Enterprise for Minorities, Females and Persons with Disabilities Act [30 ILCS 575/2].

 

1)         In determining the annual gross sales, sales of any affiliated business shall also be counted.

 

2)         An affiliated business is one related to the other by virtue of significant commonality of management, or commonality of ownership (at least 5% of one company owned by owner or management personnel of the other).  Other factors that may be considered in determining affiliation include, but are not limited to, sharing of office space, workers or equipment.

 

b)         A business with annual gross sales equal to or greater than the statutory maximum is eligible to participate in the program if the business can show that, if it were to receive a particular contract or subcontract, there would be a significant impact on employment of minorities, females or persons with disabilities, or in the use of BEP certified subcontractors or suppliers. Such vendors must meet all certification requirements but will not be certified or be listed in the Directory.

 

1)         For the impact to be significant in terms of employment, the business would have to hire new employees to perform the work of the contract and at least 51% of those new hires must be minority, female or persons with disabilities.

 

2)         For the impact to be significant in terms of use of subcontractors or suppliers, the business must direct 51% of the value of the contract to BEP certified vendors as subcontractors or suppliers.

 

c)         If the business makes contractual commitments regarding hiring or use of subcontractors or suppliers, agrees to appropriate enforcement mechanisms, such as bonding or damage provisions, and meets the other requirements for certification, the Secretary, on behalf of the Council, will approve counting expenditures under that contract toward the agency's goal.

 

(Recodified from Section 10.64 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.65  Citizenship/Permanent Residency

 

a)         The individuals claiming ownership and control of the applicant business must be citizens or lawful permanent residents of the United States.

 

b)         Proof of citizenship or permanent residency must be confirmed by a birth certificate, naturalization papers, permanent resident status documents, passports or other documents.

 

(Recodified from Section 10.65 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.66  Ownership/Control by Members of Eligible Groups

 

a)         The individuals claiming ownership and control of the applicant business must be members of the eligible groups identified in Section 30.40(a) of this Part.

 

b)         The applicant must provide proof of eligible group status.  Proof must be in the form of official documentation such as birth certificates, passports, naturalization papers, or Tribal I.D. Card, if available.  If an individual does not have official documentation, or if it is not sufficient, the Secretary will consider other evidence the applicant submits.  Other evidence might include whether the individual identifies with, holds him or herself out as part of, or others recognize him or her as belonging to, an eligible group.

 

(Recodified from Section 10.66 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.67  Ownership

 

a)         The individuals claiming ownership and control of the applicant business must own at least 51% of the business.

 

b)         The ownership shall be real, substantial and continuing and not simply a matter of form.  "Real" is a bona fide investment in the business done at arm's length and in good faith.  "Substantial" is the level of investment necessary to initiate or acquire the particular business in light of its value, the business field, the organization of the concern, and the potential sources of outside financing.  The following factors, among others, are weighed together to help determine whether ownership is real, substantial, continuing and not a matter of form.

 

1)         How ownership was obtained, including, but not limited to, purchase, gift or inheritance.

 

2)         How substantial was the contribution toward ownership in terms of expertise, money, or other such factors?  The following are some examples of factors that may indicate insufficient contribution:

 

A)        minimal cash outlay or personal investment;

 

B)        a promise or agreement to contribute capital;

 

C)        a note payable to the firm or other owners who are not eligible group members;

 

D)        contributions for services rather than capital, except where services are unique, specialized or of a value commensurate with the ownership value of such services;

 

E)        payment of contribution with funds loaned by a non-eligible group, former employer or stockholder;

 

F)         no recourse loans where the borrower assumes no liability for repayment upon default; and

 

G)        no recourse stock purchases wherein the purchaser assumes no liability upon default of payment other than transaction of shares.

 

3)         How the applicant holds ownership.  In terms of stock holdings, the following are factors that may indicate ownership is not as stated:

 

A)        minimal cash outlay or personal investment;

 

B)        a promise or agreement to buy stock;

 

C)        stock issued, but not purchased;

 

D)        stock certificates purchased but not in the possession of the applicant; or

 

E)        stock held in trust.

 

4)         The applicant must provide documentary proof of ownership, including, but not limited to, the following:

 

A)        canceled checks or bookkeeping entries;

 

B)        signed purchase agreements;

 

C)        stock certificates, transfer ledgers and stockholder agreements;

 

D)        partnership agreements;

 

E)        profit sharing agreements; and

 

F)         buy-out-right agreements.

 

(Recodified from Section 10.67 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.68  Control

 

a)         Ownership by eligible group members does not equate to control.

 

b)         The individuals claiming ownership and control of the applicant business must actually control the applicant business.  Those individuals must be in direct control of the day to day operations, and must have, and exercise, the power to make major decisions on management, policy, fiscal and operational matters.  At a minimum, the following factors will be considered in determining control.

 

1)         Do the articles of incorporation show the eligible group owners were involved at the time of incorporation and in what way?  If the eligible group owners were not involved at the time of incorporation, when did they become involved?

 

2)         Corporate by-laws will be reviewed to determine:

 

A)        the duties of the directors and officers who occupy these positions;

 

B)        the voting rights of the shareholders; and

 

C)        any restrictive language that may affect the eligible group owner's stock voting rights.

 

3)         Are there any stock options/shareholders agreements that, if exercised, will dilute or eliminate eligible group owner control?

 

4)         Do the eligible group owners make decisions independently?

 

5)         Does a review of resumes show the eligible group owners have sufficient background, including education and training, to run the particular business and for the responsibilities assigned?

 

6)         Do the eligible group owners continue to work for a firm not eligible for the BEP, and if so, what is the relationship of the firm to the applicant business?

 

7)         Who in the firm negotiates contracts and loans, prepares estimates and makes other management and supervisory decisions?

 

(Recodified from Section 10.68 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.69  Notice of Certification or Denial

 

a)         Notification of Certification

When the Secretary has determined that the applicant meets the requirements of the Act and this Part, the Secretary will notify the applicant by letter that it has been certified.

 

b)         Notification of Denial of Certification

When the Secretary determines that the applicant does not meet the requirements of the Act and this Part, the Secretary shall send a letter to the applicant setting forth the rationale for the determination and advising the applicant of the review process.

 

c)         Effect of Denial

After all reconsiderations and reviews provided in this Part have been exhausted, if the decision remains to deny certification, the Secretary shall remove the applicant from the list of certified vendors.

 

d)         Reapplication

If a certification application is denied, the business may reapply one year after the date of denial. Applications submitted prior to that date will not be considered.

 

(Recodified from Section 10.69 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART G: RECONSIDERATION

 

Section 30.70  Review and Reconsideration

 

a)         The applicant may request a review of a certification denial by submitting this request in writing to the Secretary postmarked no later than 30 days after the applicant received the certification denial letter. The request must state why the applicant believes the denial decision is wrong, must address all points raised in the denial decision and must include any supporting documentation.

 

b)         The Council's Certification Committee, made up of at least three Council Members, shall consider any requested review of the denial decision.  The Secretary will attempt to schedule a Committee meeting within 30 days after receipt of the request for review.  The meeting shall be held in Chicago.  The Secretary will notify the applicant at least 10 days prior to the meeting of the location, date and time.

 

c)         The Secretary shall provide each Committee member with a copy of the request for review, other relevant information and a response to the points raised in the request for review.  Each Committee member shall review the files prior to the meeting.

 

d)         The Committee Chair shall call the meeting to order, announce the matter at issue and explain the meeting procedures. The Chair shall briefly restate the reasons given for the denial decision and open the floor to the applicant. The meeting shall proceed in an informal manner within these procedures.  All information obtained shall be considered.

 

e)         The applicant may make an opening statement, but must respond to each of the reasons for denial given in the denial decision.  The applicant may bring and question any witnesses.  The Committee may ask questions of the applicant, the Secretary or any other person present.  The Secretary may comment at any time. When the applicant is finished the Secretary may call witnesses.  Both applicant and Secretary may make closing statements. Although the applicant may have an attorney or other representatives assist at the meeting, applicant must be present and applicant must respond to questions of the Committee.

 

f)         The Committee shall consider the information obtained at the meeting.  The Committee's decision will be based upon majority vote to be given at a Committee meeting or submitted individually to the Secretary, who shall record and report the vote.

 

g)         If the decision is favorable to the applicant, the Secretary will notify and place the applicant on the list of certified vendors.  If the decision is adverse to the applicant, the Secretary will notify the applicant, providing the Committee's reasons and information on the further review that is available.

 

h)         The applicant may ask that the full Council review an adverse decision of the Certification Committee.  The applicant must submit this request in writing to the Secretary.  The request must be postmarked no later than 15 days after the applicant received the Committee's decision.  This request must state why the applicant believes the Committee's decision is wrong, must address all points raised in the Committee's decision and must include any supporting documentation.

 

i)          The Secretary shall provide each Council member with a copy of the request for review and a copy of the Secretary's file on the matter. In addition, the Secretary shall prepare and submit to the Council a draft response to the points raised in the request for review.  The Secretary shall consult with the Committee prior to submitting the draft.

 

j)          The Secretary will schedule the review at the earliest convenience of the Council. The applicant will be told of the location, date and time of the meeting.

 

k)         The Council shall consider only the written information provided or produced by the applicant, the Certification Committee and the Secretary.  The Council may, on its own, request that the applicant address the Council or respond to specific questions.  If the Council requests that the applicant be present, the applicant may have an attorney or other representative assist at the meeting, but the applicant must be available to respond to Council questions.  The Council will allow the applicant to address the Council if the applicant makes that request as part of the second request.

 

l)          After reviewing all information obtained, the Council shall vote to uphold the Committee's decision, overturn the Committee's decision or have the matter sent back to the Committee for reconsideration with instructions from the Council.

 

m)        If the decision is favorable to the applicant, the Council shall inform the Secretary.  The Secretary shall place the applicant on the list of certified vendors.  The Secretary shall inform the applicant.

 

n)         If the decision is adverse to the applicant, the Council shall inform the Secretary.  The Secretary shall notify the applicant.

 

o)         If the decision is to send the matter back to the Committee, the process shall continue from that point until resolved at the Committee or Council level.

 

(Recodified from Section 10.70 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.71  Decertification Process

 

a)         The State, or a third-party, may challenge the certification status of a business at any time.

 

b)         Upon receipt of information that questions the validity of a certification, the Secretary shall conduct an investigation.  This may include on-site or telephone interviews, review of existing records, or collection and examination of new records to supplement, explain or clarify records previously submitted.

 

c)         If the investigation results in a finding that the firm is no longer eligible for BEP status, the Secretary shall notify the firm that it is decertified.  The applicant may appeal using the review and reconsideration procedure of Subpart G.  After decertification, the applicant may not reapply for certification until one year has passed since the date of decertification. A certification of the applicant by another entity shall not be accepted during the one year period following decertification.

 

(Recodified from Section 10.71 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.72  Annual Confirmation of Eligibility

 

a)         To maintain its certification, a certified business must file with the Secretary on an annual basis an Annual Confirmation form confirming there have been no changes in ownership or control from the last certification that would affect the validity of the certification and shall provide any additional information requested by the Secretary.  The Annual Confirmation form shall be in the form specified by the Secretary and shall include, but not be limited to, owner demographics, annual gross sales, current licensing, ownership interest, certification documentation with other entities and a signed and notarized affidavit.

 

b)         At least 60 days prior to the anniversary of a certification, the Secretary shall send a notice to the certified business advising that it must complete and return the Annual Confirmation form, postmarked by the date specified in the notice.

 

c)         If the certified business fails to submit the Annual Confirmation form, the Secretary shall issue a provisional revocation of the certification and so notify the business.  If the Annual Confirmation form is not received within 30 days after the mailing of the provisional revocation to the certified business, the revocation shall become final and the business shall be so notified.

 

d)         If the certified business submits an Annual Confirmation form that indicates that ownership or control have changed such that the certified business is or may be no longer eligible for certification, the Secretary may request further information or may issue a final revocation.

 

e)         Upon receipt of the notice of final revocation, the certified business may submit a new and complete application for certification.

 

f)         In addition to the annual confirmation, the Secretary may require confirmation of eligibility at any time during the term of certification.

 

(Recodified from Section 10.72 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART H: SPECIAL ASSISTANCE FOR CERTIFIED BUSINESSES

 

Section 30.80  Special Assistance

 

a)         Purchasing agencies may waive or reduce bond requirements for certified vendors when allowed by law and when the reduced bond amount would adequately protect the State's interests.

 

b)         Purchasing agencies may enter into contracts with certified vendors that contain a provision allowing advance or progress payments or both, except that a construction contract may not contain an advance payment provision.  The advance or progress payment provision may be added to a contract at any time by agreement of the parties.  Agencies must consider the application of Section 9.05 of the State Finance Act [30 ILCS 105/9.05] before including such provisions in contracts.

 

c)         With the prior general approval of the Council, the Chief Procurement Officer for General Services may, by express written authorization, allow purchasing agencies to establish set-asides and other such preferences for BEP certified vendors.

 

(Recodified from Section 10.80 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART I: CONTRACT REQUIREMENTS

 

Section 30.90  Change in Eligibility

 

a)         Any contract awarded with Section 10.80 provisions may not be assigned to another vendor without approval of the Secretary.

 

b)         Should a vendor who received a contract with Section 30.80 provisions cease to qualify as a BEP vendor during contract performance, the purchasing agency may cancel the contract immediately without penalty to the State.

 

c)         Any change in the eligibility status of a vendor awarded a contract with Section 30.80 provisions shall be reported to the Council by both the vendor and the purchasing agency.

 

(Recodified from Section 10.90 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.91  Contract Commitment; Good Faith Effort

 

a)         A vendor who obtains a contract requiring hiring of BEP certified vendors, such as pursuant to Section 30.64, or who makes a voluntary contractual commitment to hire BEP certified vendors, and who fails to do so, is subject to having the contract canceled.  If the agency cancels the contract, the vendor may be liable for any damages the State suffers as a result of the cancellation.  The State may excuse the vendor's failure if the vendor can show a good faith effort to remain in compliance.

 

b)         Any vendor claiming good faith relief must fully document, in writing, the steps taken to obtain BEP certified vendors as subcontractors. The State may require that the vendor provide additional information on request.  A good faith effort shall, at a minimum, consist of the following:

 

1)         contacting the Business Enterprise Bureau at least 15 days prior to need and requesting referrals from the certified vendor list and from any other list maintained by the Bureau;

 

2)         advertising in the Official State Newspaper or a local newspaper as time permits; and

 

3)         contacting appropriate organizations such as unions, contractor associations, and MBE, FBE, or PBE oriented organizations.

 

c)         If a good faith exception is given, the purchasing agency shall notify the Secretary of the exception and shall include all pertinent information.

 

(Recodified from Section 10.91 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART J: VIOLATIONS BY VENDOR

 

Section 30.100  Violations by Vendor

 

Should a vendor violate the Act, this Part, or the terms of contracts let pursuant to this Program, the State may pursue any or all of the following actions.

 

a)         A certified vendor may be decertified and an applicant for certification may be denied certification for reasons including, but not limited to:

 

1)         refusal to supply information sufficient for the Secretary or the Council to make a determination for eligibility or continued eligibility;

 

2)         refusal to supply additional proof of eligibility for the Program, particularly after receiving a contract with Section 30.80 (Special Assistance) provisions;

 

3)         accepting a contract with Section 30.80 (Special Assistance) provisions when the vendor does not qualify for the Program; or

 

4)         any other violation of the Act or this Part.

 

b)         The State may cancel, without penalty to the State, any contract entered into by a vendor in violation of:

 

1)         the Act or this Part;

 

2)         the requirements of a contract let with Section 30.80 (Special Assistance) provisions; or

 

3)         commitments regarding use of certified vendors, including, but not limited to, those in Section 30.64 (Sales Limitation; Exception) and Section 30.91 (Contract Commitment; Good Faith Effort).

 

c)         In the case of a cancellation under subsection (b)(2) or (b)(3), the amount of profit applicable to amounts paid to the vendor shall be withheld from any amounts owed to the vendor.  If the amount owed the vendor is insufficient to off-set profits, the vendor shall be liable to pay back to the State any balance of those profits.  The profit rate shall be deemed 20% unless a lesser or greater amount can be conclusively proved.

 

d)         The Secretary may suspend a vendor from the program for a period of no more than one year and a contracting agency may cancel a contract for a violation of:

 

1)         the Act or this Part;

 

2)         the requirements of a contract let with Section 30.80 (Special Assistance) provisions; or

 

3)         commitments regarding use of certified vendors, including, but not limited to, those in Section 30.64 (Sales Limitation; Exception) and Section 30.91 (Contract Commitment; Good Faith Effort).

 

e)         Depending on the seriousness of the violation, the suspension shall be:

 

1)         from participation in the BEP Program; or

 

2)         from further contracting with the State.

 

f)         A vendor may appeal any of the actions of the Council taken pursuant to this Section in the same manner as a vendor denied certification (see Subpart G of this Part).

 

g)         The Secretary shall notify the Chief Procurement Officers, State Purchasing Officers and other interested parties of the revocation of certification or of suspension.

 

h)         If any agency finds or suspects that a business is in violation of the Act or of this Part, the violation should be reported to the Secretary as soon as practicable after the finding.

 

(Recodified from Section 10.100 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

SUBPART K: SHELTERED MARKETS

 

Section 30.200  Purpose

 

This Subpart is intended:

 

a)         to set forth the practice and procedures to be followed for the establishment and continuation of narrowly tailored sheltered markets under Section 8b of the Act;

 

b)         to provide opportunity for the public to understand and comment on evidence regarding past or present racial, gender or disability-based discrimination present in procurements by interested State agencies;

 

c)         to establish procedures by which the Council consults interested or affected segments of the public;

 

d)         to enable the Department to fully consider and respond to evidence regarding past or present racial, gender or disability-based discrimination present presented to the Council;

 

e)         to establish cooperation between the Department and other governmental bodies, including the Council, the Offices of the Chief Procurement Officers, and interested State agencies and public institutions of higher education;

 

f)         to foster openness among the Department, other governmental bodies, and the public; and

 

g)         to comply with State and federal requirements.

 

(Recodified from Section 10.200 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.201  Applicability

 

This Subpart sets forth the procedures to be followed by the Department, State agencies, public institutions of higher education and the Council in collecting evidence of past or present racial, gender, or disability-based discrimination present in the award of State contracts, and applying, if appropriate, procedures to establish and continue narrowly tailored sheltered markets to address this discrimination.  This Subpart shall apply to procurements of State agencies and public institutions of higher education as defined in Section 30.10.

 

(Recodified from Section 10.201 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.202  Evidence of Discrimination

 

a)         The Council shall receive, review and discuss any evidence regarding past or present racial, gender or disability-based discrimination that directly impacts State contracting at every regular meeting. Evidence may include, but is not limited to, written documentation or oral testimony regarding specific instances of such discrimination against MBEs, FBEs and PBEs.

 

b)         The Department may commission disparity and utilization studies that may indicate, among other things, any quantitative effects of discrimination in specific industries and geographic locations. The Department shall forward a copy of its findings and recommendations to the Council. 

 

c)         The Secretary shall investigate and make recommendations to the Council concerning the use of the sheltered market process.

 

(Recodified from Section 10.202 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.203  Establishment and Adjustment of Sheltered Markets

 

a)         The Council shall vote to decide whether to establish a sheltered market or to adjust an existing sheltered market when the Council finds a pattern of racial, gender or disability-based discrimination in a particular industry.

 

1)         The Council must vote to establish or adjust an existing sheltered market by a majority vote.

 

2)         The Council shall only vote to establish sheltered markets when other feasible remedial measures are insufficient to address the discrimination; provided, however, that there shall be no requirement to exhaust all potential remedial measures before establishing sheltered markets.

 

b)         The procuring State agency or public institution of higher education shall work with its respective Chief Procurement Officer to implement or adjust existing sheltered markets as established by the Council.

 

(Recodified from Section 10.203 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.204  Sheltered Market Procurements

 

Solicitations selected by the procuring State agency or public institution of higher education to implement sheltered markets through specific procurements shall be a narrowly tailored remedy to address identified discrimination.

 

(Recodified from Section 10.204 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)

 

Section 30.205  Participation Eligibility

 

a)         Participation in any sheltered market solicitation shall be limited to BEP certified vendors.

 

b)         The Council may choose which subgroups within the BEP certified vendor pool can participate in any sheltered market, on a case-by-case basis, based on evidence of racial, gender or disability-based discrimination.

 

c)         Participating businesses shall make all books and records related to the performance of any sheltered market contract available for audit pursuant to Section 20-65 of the Illinois Procurement Code.

 

d)         Any subcontractors utilized on a sheltered market procurement shall be BEP certified vendors.

 

(Recodified from Section 10.205 of 44 Ill. Adm. Code 10 (Central Management Services) pursuant to P.A. 101-657, at 47 Ill. Reg. 279)