Agenda Item 8A
February 3, 2015
Introduction
MEMORANDUM
January 30, 2015
TO:
FROM:
SUBJECT:
County Council
Robert H. Drummer, Senior Legislative Attorney
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Introduction:
Bill 5-15, Contracts and Procurement - Health Insurance Preference
Bill 5-15, Contracts and Procurement - Health Insurance Preference, sponsored by
Councilmember Navarro, is scheduled to be introduced on February 3,2015. A public hearing is
tentatively scheduled for March 3, 2015 at 1:30 p.m.
Bill 5-15 would create a preference in the competitive procurement of services by the
County for a business that provides health insurance for its employees and require the County
Executive to adopt a regulation implementing this preference. The public health and welfare is
better served if each County resident has access to affordable health care.
Congress recognized this when enacting the Patient Protection and Affordable Care Act.
Although the Federal mandate for employers with more than 100 employees to provide its
employees with affordable health insurance began this year and the mandate for employers with
50 99 employees is scheduled to begin in 2016, there are still many smaller employers in the
County who do not provide health insurance for their employees. Bill 5-15 would encourage a
County bidder to provide affordable health insurance for its employees by giving these bidders a
preference in the competitive process. Councilmember Navarro outlined her reasons for
introducing this legislation
in
a memorandum attached at ©8.
This packet contains:
BillS-IS
Legislative Request Report
Navarro Memorandum
F:\LAW\BILLS\1505 Contracts - Health Insurance Preference\Intro Memo.Docx
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Bill No. _ _ _
~!.!:!-
_ _ _ __
Concerning: Contracts and Procurement
- Health Insurance Preference
Revised: December 29, 2014 Draft No.
.1
Introduced:
Februarv 3, 2015
Expires:
August 3,2016
Enacted: _ _ _ _ _ _ _ _ __
Ex~uwe:
_ _ _ _ _ _ _ _
~
__
Effective:
_~~
_ _ _ _ _ __
Sunset Date:
-,-!N""on,:,-,e~_~
_ _ __
Ch. _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Councilmember Navarro
AN
ACT to:
(1)
(2)
(2)
create a preference in the procurement of services by the County for a business that
provides health insurance for its employees;
require the County Executive to adopt a regulation implementing the preference for
a business that provides health insurance for its employees; and
generally amend the law governing the County's procurement of services.
By adding
Montgomery County Code
Chapter lIB, Contracts and Procurement
Article XVII
Section 11 B-77
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unqffected by bill.
The County Council for Montgomery County, Maryland approves
the
following Act:
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BILL
No. 5-15
1
2
Article XVll is added to Chapter lIB as follows:
Article XVll. Preference for Business With Health Insurance.
IIB-77. Preference for Business With Health Insurance.
(a)
Definitions.
In this Article the following tenns have the following
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meanmgs:
Business With Health Insurance
means
~
business that provides health
insurance for each employee who provides services to the County under
~
contract.
Certified Business With Health Insurance
means
~
business certified
Qy
10
the Director as meeting the standards established
Qy
regulation for
Business With Health Insurance.
~
11
12
Contract
means
~
contract for procurement services subject to the Wage
13
14
15
16
Requirements Law in Section IIB-33A.
Director
means the Director of the Department of Health and Human
Services or the Director's designee.
Health insurance
means insurance coverage that is part of an employer
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benefit package that
~
for medical expenses incurred
Qy
an employee
and an employee's family either
Qy
reimbursing the employee or
Qy
paying the care provider directly and provides the minimum essential
health benefits required under the Patient Protection and Affordable
Care Act, 26 U.S.C. §5000A, as amended.
Health insurance evaluation .(actor
means an evaluation factor in
~
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request for proposals that gives an offeror credit for being
Business With Health Insurance.
Percentage price prekrence
means the percent
Qy
which
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certified
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responsive
bid from
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responsible bidder who is
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certified Business With Health
~
Insurance may exceed the lowest responsive bid submitted
Qy
o
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BILL
No.
5-15
28
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responsible bidder who
Insurance.
(hl
Regulation.
IS
not
~
certified Business With Health
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The County Executive must adopt
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regulation under
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Method
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that includes:
ill
ill
ill
8:)
an application process for
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business to be certified as
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Business
With Health Insurance;
standards for
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business to meet to be certified as
£!
Business With
Health Insurance;
£!
percentage price preference for
§:
Business With Health
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Insurance under
£!
solicitation for competitive sealed bidding; and
§:
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Business With Health Insurance evaluation factor for use in
§:
request for proposals.
(g)
Certification.
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The Director must certify
§:
business that meets the
standards established
Qy
regulation as
£!
Business With Health
Insurance.
@
Role
gf
Office gf Procurement and Department gfHealth and Human
Services.
ill
The Office of Procurement must review all specifications of each
using department and each cooperative purchasing agreement to
assure compliance with this Section, appropriate use of
§:
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percentage price preference or an evaluation factor, and
consistency among using departments procuring similar services.
ill
The Department of Health and Human Services must operate the
certification process and maintain
£!
list of businesses that have
been certified as
£!
Business With Health Insurance.
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Utl
Denial or Revocation
gf
certification.
The Director may refuse to
certify
§:
business under this Section, and may suspend or revoke
£!
o
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BILL
No.
5-15
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certification issued under this Section, after
~
hearing for which
reasonable notice has been given, if the business or applicant does not
meet the standards for certification as
Insurance. '
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Business With Health
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ill
Notice and opportunity fOr hearing.
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ill
Notice.
After finding that one or more grounds for denial,
suspension, or revocation of
Director may serve
in person or
~
~
certification could exist, the
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written notice on the business or applicant
postage prepaid, addressed to the
hY
regular mail,
person's last known address as maintained in the Director's file.
Service on that person
hY
mail is effective
d
days after mailing.
The written notice must, at
~
minimum:
CA)
state that the Director has found that the business or
applicant may be subject to denial, suspension, or
revocation ofthe certification;
ill.)
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identify the specific grounds for the Director's findings;
and
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{Q
set
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date for
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hearing on denial of the application or
suspension or revocation of the certification.
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ill
Hearing.
The Director or
~
designee may conduct the hearing. At
the hearing, the business or applicant may present evidence and
witnesses to refute the grounds cited
hY
the Director for denying
the application or suspending or revoking the certification, and
the County and any other person may submit relevant evidence.
The relevant records of the Department are part of the hearing
record.
The person conducting the hearing must render
~
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decision in writing, giving the reasons for the decision. That
G
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BILL NO. 5-15
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decision is fmal, subject to judicial review under the Maryland
Rules for review of administrative decisions in the Circuit Court
and the Court of Special Appeals.
ill
Failure to appear.
A business or applicant who after notice does
not appear at
~
hearing waives the right to
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hearing and consents
to the action that the Director proposed in the notice. The
Director may deny the application or suspend or revoke the
certification as proposed in the notice.
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(g)
Appeals.
Any person aggrieved
Qy
the denial, suspension, or revocation
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of any certification under this Section may seek judicial review under
the Maryland Rules for review of administrative decisions in the Circuit
Court and the Court of Special Appeals.
(b)
Report
fu!.
Office gf Procurement.
The Director of the Office of
95
Procurement, after consulting with the Director of Health and Human
Services, must submit
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report to the County Council and County
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Executive
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September 30 each year after implementation of this
Section for the prior fiscal year. The report should include:
ill
the dollar value of services purchased from
With Health Insurance;
~
certified Business
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rn
ill
the dollar value of services purchased from
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business that is not
certified Business With Health Insurance;
to the extent ascertainable, the additional cost of any contracts
awarded to'
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certified Business With Health Insurance under
~
percentage price preference;
ill
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summary of applications for certification as
~
Business With
Health Insurance made during the year, including the results of
each application;
(j)
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1505 contracts - health insurance preference\bill 1.doc
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BILL
No.
5-15
109
110
ill
®
ill
Approved:
~
list of certified Businesses With Health Insurance;
suggested legislative or administrative changes; and
any other relevant infonnation.
111
112
113
George Leventhal, President, County Council
Date
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115
Approved:
Isiah Leggett, County Executive
Date
116
117
This is a correct copy o/Council action.
Linda M. Lauer, Clerk ofthe Council
Date
®
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LEGISLATIVE REQUEST REPORT
BillS-IS
Contracts and Procurement
-
Health Insurance Preference
DESCRIPTION:
Bill 5-15 would create a preference in the competitive procurement of
services by the County for a business that provides health insurance
for its employees and require the County Executive to adopt a
regulation implementing this preference.
County residents without access to affordable health insurance create
a drain on public resources and adversely affects the public health and
welfare.
To encourage bidders for County service contractors to provide
employer sponsored health insurance for their employees.
Department of General Services, County Attorney
To be requested.
To be requested.
To
be
requested.
To be researched.
Robert
H.
Drummer, Senior Legislative Attorney
Not applicable.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT: '
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
None.
f:\law\bills\1505 contracts - health insurance preference\legislative request report.docx
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MONTGOMERY COUNTY COUNCIL
ROCKVILLE, MARYLAND
NANCY NAVARRO
COUNCILMEMBER, DISTRICT 4
MEMORANDUM
January 15,2015
TO:
FROM:
SUBJECT:
Councilmembers
~/~! ,4/~/4
'/!
[E' ,
Nancy Navarro, Councilmember
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Health Insurance Procurement Preference
On October 30,2013, I sent you a memo about my intent to introduce legislation
that would help provide low-wage employees of County contractors with access to
affordable health insurance. On February 4, 2014, I introduced Bill 14-14, Contracts and
Procurement - Wage Requirements - Health Insurance - Amendments. Over the course of
nearly a year, I have worked closely with the Executive Branch and the Laborer's
International Union ofNorth America (LiUNA) to maintain the goal of providing more
workers with health insurance while at the same time ensuring that any approach we take
is fiscally sustainable. On January 22
nd,
the Health and Human Services Committee
(HHS) and Government Operations and Fiscal Policy Committee (GO) is set to hold its
final worksession and vote on Bill 14-14.
Bill 14-14's focus, as amended, requires the Department of Health and Human
Services (DHHS) to help employees of County contractors sign up for health insurance
through the Maryland Health Exchange and receive the maximum subsidy allowed by the
Affordable Care Act. The bill also strengthens the County's Living Wage Law by
requiring employers to report to the Department of General Services (DGS) on the
number of employees with health insurance and requires DGS to retain contractors'
quarterly payroll records, which it does not currently do.
In my October 30,2013 memo, I said I was "exploring legislation that would
grant a preference to a bidder on a County contract who provides affordable benefits for
their employees." The attached legislation does just that. I believe that as a County we
should reward contractors who treat their employees fairly. Including this preference in
the procurement process demonstrates this value.
Thank you in advance for your support and please contact my office if you would
like to cosponsor the attached legislation.
STELLA
B.
WERNER CoUNCIL OFFICE BUILDING' ROCKVILLE, MARYLAND 20850
(240) 777-7968 •
TrY
(240) 777-7914
COUNClLMEMBER.NAVARRO@MoNTGOMERYCOUNTYMD.GOV • WWW.COUNClLMEMBERNAVARRO.COM