SF4874

Purpose

This bill adds a prohibition to state procurement. It stops state agencies from entering into contracts to buy goods or services with a company that is owned by a person who has been convicted of certain crimes or who has been found liable for making false claims against the state or the United States. The goal is to ensure integrity and prevent contracting with vendors tied to fraud or serious criminal activity.

Main Provisions

• Subdivision 1 – Contract prohibited
  • A state agency must not contract with a company owned by a person who has:
  • Been convicted of theft (section 609.52),
  • Committed perjury (section 609.48),
  • Committed aggravated forgery or forgery (sections 609.625 and 609.63), or has been convicted under substantially similar federal laws,
  • Been held liable for making false claims against the state under chapter 15C, or
  • Been held liable for making false claims against the United States under substantially similar federal laws.
• Subdivision 2 – Ownership
  • For purposes of this section, ownership is defined as:
  • Sole proprietorship: the sole proprietor is the owner.
  • Partnership: any one of the partners with an ownership interest is considered an owner.
  • Corporation: any person with an ownership interest in the company is considered an owner.

Significance and Scope

• This bill creates a clear disqualification mechanism in state procurement, tying a vendor’s eligibility to the criminal or false-claims history of individuals who own or control the company.
• It applies to all state agencies procuring goods or services and uses existing criminal statutes and false-claims provisions to determine disqualification.
• It codifies the prohibition in Minnesota Statutes, specifically chapter 16C, section 16C.0535.

Definitions and Key Terms (for clarity)

• State agency, contract to procure goods or services, vendor, company, ownership, sole proprietorship, partnership, corporation, false claims, and the relevant crime statutes.

Relevant Terms - state agency - contract - procure goods or services - company owned by a person - convicted of theft (section 609.52) - perjury (section 609.48) - aggravated forgery (section 609.625) - forgery (section 609.63) - substantially similar federal laws - false claims against the state (chapter 15C) - false claims against the United States (federal equivalents) - ownership - sole proprietorship - partnership - corporation - Minnesota Statutes chapter 16C - section 16C.0535 - vendor, supplier, contractor - procurement integrity