Current through September 18, 2024
A. Under R.I. Gen.
Laws §
37-2-33(1),
Unless otherwise provided in the statute making appropriations therefore,
multi-year contracts for supplies and services may be entered into for periods
not extending beyond the end of the biennium in which the contract was made, if
funds for the first fiscal year of the contemplated contract are available at
the time of contracting. Payment and performance obligations for succeeding
fiscal years shall be subject to the availability of funds therefore.
1. "Biennium" shall mean a period of time
equal to two fiscal years.
2.
"Fiscal year" shall mean a period of time beginning on the first day of July in
one calendar year and ending on the last day of June of the subsequent calendar
year.
3. Multi-year contracts which
extend beyond a biennium shall be permitted provided that:
a. funds for the first year of the biennium
have been appropriated; and
b.
contracts shall contain a standard clause which states that implementation of
the contract beyond the first fiscal year shall be subject to the availability
of funds; and
c. a written
justification is placed in the purchase order file or the category of
procurement has by regulation or policy been identified by the Chief Purchasing
Officer as appropriate for multi-year contracting, e.g., property
leases.
4. Multi-year
contracts shall specify the annual costs and total value of each
contract.
B. Under R.I.
Gen. Laws §
37-2-33(2),
Prior to the utilization of a contract as described in subsection
37-2-33(1),
it shall be determined in writing by the Chief Purchasing Officer:
1. That estimated requirements cover the
period of the contract and are reasonably firm and continuing; and
2. That such contract will serve the best
interests of the state by encouraging effective competition or otherwise
promoting economics in state procurement.
3. The Chief Purchasing Officer may delegate
to the Purchasing Agent all or a portion of the responsibility and authority to
make such determinations.
C. In accordance with R.I. Gen. Laws §
37-2-33(3)
when funds are not appropriated or otherwise made available to support
continuation of performance in a subsequent year of a [multi-year] contract,
the contract for such subsequent year may be cancelled and the contractor shall
be reimbursed or the reasonable value of nonrecurring costs incurred but not
amortized in the price of the supplies or services delivered under the
contract. The cost of cancellation may be paid from:
1. Appropriations currently available for
performance of the contract; or
2.
Appropriations currently available for procurement of similar supplies or
services and not otherwise obligated; or
3. Appropriations made specifically for the
payment of such cancellation costs.
D. Multi-year contracts shall be appropriate
purchasing instruments for transactions for which the nature of the goods and
services will remain relatively stable over time; and for which potential
changes in price can be predicted and agreed to in advance, including
provisions for mandated escalation requirements, such as:
1. Lease and lease-purchase agreements for
equipment, real property, and facilities;
2. Maintenance and repair of specialized
equipment;
3. Special licensing
agreements (computer, communication);
4. Special services for which the contract
award is based on a request for proposals, such as residential treatment
programs;
5. Supplemental services,
the approval of which is based upon the recommendation of the State
Architectural, Engineering and Consultant Selection Committee and selection by
the Chief Purchasing Officer; and
6. Any other contractual relationship where
it has been determined in writing by the Chief Purchasing Officer that a
long-term agreement shall be the most cost effective method of
procurement.
E. User
agencies shall specify on requisitions and shall submit justification whether
multi-year contracts should be considered by the Purchasing Agent for the
supply or service requisitioned.
