State purchasing, contracting bill advanced

A bill that would require an evaluation of Nebraska Department of Administrative Services procurement practices advanced from general file Feb. 25.

LB1037, introduced by Sen. John Arch of La Vista, would require an outside consultant to review all DAS procedures with an emphasis on due diligence, cost evaluation, decision-making accountability and protest procedures.

The bill also would require DAS to submit a report to the Legislature and governor by Nov. 15.

Arch said the bill grew out of the department’s selection of St. Francis Ministries in 2019 to manage child welfare cases in the Eastern Service Area. It later was revealed that St. Francis had underbid the contract significantly causing the organization to come back to the state for $80 million in additional funding, Arch said.

The state ended the contract with St. Francis a year earlier than planned and is taking over case management in the Eastern Service Area.

Arch said the St. Francis contract was just one of several failures of the state’s procurement system.

“The history of these decisions spans multiple administrations and directors of departments. The names change but the pattern continues,” he said.

The Government, Military and Veterans Affairs Committee offered an amendment to add the provisions of LB1064, also introduced by Arch, to the bill. The proposal would establish a funding system to allow the DAS Materiel Division to obtain an electronic procurement system.

“Every bid in the state of Nebraska is still done through a myriad of paperwork,” Arch said. “The hassle of filling out all that paperwork by hand deters bidders, particularly small businesses.”

Sen. Mark Kolterman of Seward supported the bill and the amendment. He said the state’s current procurement system is a “wreck” that hasn’t been updated in more than 20 years.

“We’ve wasted a lot of money,” Kolterman said.

Lincoln Sen. Matt Hansen also spoke in support of the bill, saying the current system is “directionless and unclear” and often doesn’t result in good outcomes for the state.

Senators adopted the committee amendment on a 40-0 vote and advanced LB1037 to select file 42-0.