Current through Register Vol. 48, No. 38, September 20, 2024
a)
General
The term of a contract, including potential renewals, may not
exceed 10 years except a software license designated as a perpetual license is
not considered a multi-term contract; it is instead a one-time purchase.
b) Subject to Appropriation
Each contract is contingent upon and subject to the
availability of funds. The State agency, at its sole option, may terminate or
suspend a contract, in whole or in part, without penalty or further payment
being required, if the Illinois General Assembly or the federal funding source
fails to make an appropriation sufficient to pay that obligation or if funds
needed are insufficient for any reason. Each contract payable in whole or in
part by any funds appropriated by the Illinois General Assembly shall recite
that the contract is subject to termination and cancellation for lack of, or
insufficiency in, funding. A vendor will be notified in writing by the State
agency of a failure to receive or a reduction or decrease in any appropriation
affecting the contract. This provision applies to only those contracts that are
funded in whole or in part by funds appropriated by the Illinois General
Assembly or other governmental entity.
c) Conditions for Use of Multi-Year Contracts
A multi-year contract may be used when:
1) special production of definite quantities
or the furnishing of long-term services is required to meet State needs;
or
2) a multi-year contract will
serve the best interests of the State by encouraging effective competition or
otherwise promoting economies in State procurement. The following factors are
among those relevant to such a determination:
A) firms that are not willing or able to
compete because of high start-up costs or capital investment in facility
expansion will be encouraged to participate in the competition when they are
assured of recouping costs during the period of contract performance;
B) lower production costs because of a larger
quantity of service requirements, and substantial continuity of production or
performance over a longer period of time, can be expected to result in lower
unit prices;
C) stabilization of
the vendor's work force over a longer period of time may promote economy and
consistent quality; or
D) the cost
and burden of contract solicitation, award and administration of the
procurement may be reduced.
d) Multi-Year Contract Procedure
The solicitation shall state:
1) the proposed term;
2) the amount of supplies or services
required for the proposed contract period;
3) the type of pricing requested (e.g., firm
for term); and
4) how award will be
determined.
e) Renewals
1) The initial term of a contract plus
available renewals may not exceed 10 years. When the original contract
specifically calls for an initial term plus renewals, the renewals may be
exercised without further procurement activity, except for the publication of
the renewal in the Bulletin as required by Section 15-25 of the Code and
Section
1.1525 of this
Part and subject to review by the PPB under Section 5-30 of the Code. The
renewal terms and conditions shall not change except as provided in the
contract (such as price escalations tied to an index). Renewal provisions may
be exercised by the State or by mutual agreement, but shall not be exercised
solely at the option of the vendor. Any renewal that requires modification to a
material term or condition of the contract shall be treated as a new contract
and shall be subject to competitive procurement procedures established by the
Code and this Part.
2) A renewal
may only be entered into if authorized by the original contract.
3) When a renewal will result in the total
term, counting the initial term and any previous renewals, exceeding 10 years,
the State agency's need must be procured using one of the methods of source
selection authorized by the Code and this Part.
4) Renewals must be fully executed on or
before expiration of the current contract term. If the renewal is not exercised
prior to expiration of the current contract term, the supplies and services
must be procured using one of the methods of source selection authorized by the
Code and this Part.
5) Filing of
Proposed Renewals and Extensions Exceeding $249,999
Prior to executing a renewal or extension with a cost
estimated to exceed $249,999, the proposed renewal or extension must be
submitted to PPB. The PPB shall have up to 30 days to review and comment on the
proposal. The SPO assigned to the State agency may request a waiver of the
review for reasons set forth in Section 20-60(c) of the Code.
