State law generally requires state contracts meeting certain criteria (to include dollar thresholds) to be competitively bid. However, the Management and Budget Act, Act 431 of 1984, provides that, in limited instances, the State of Michigan may be permitted to make emergency purchases without a competitive solicitation process or traditional bidding. In addition to situations where a formal state of emergency has been declared, MCL 18.1261(3) provides that competitive solicitation is not required if procurement of goods or services “is necessary for the imminent protection of public health or safety or to mitigate an imminent threat to public health or safety,” as determined by the Department of Technology, Management, and Budget (“DTMB”) director. Procurement without competitive solicitation is also permissible when conducted for “emergency repair or construction caused by unforeseen circumstances when the repair or construction is necessary to protect life or property.”
Vendors should be aware that the State of Michigan is currently seeking goods and services to aid the Flint water crisis. DTMB has created a water crisis-specific Flint Emergency Purchasing webpage through which it asks vendors to notify State officials of their proposed solutions. It is unclear whether contracts related to the Flint water crisis will be treated as emergency purchasing under the Management and Budget Act—and not require competitive solicitation—or whether a traditional competitive bid process will be used. State officials have not addressed this issue, but it should be noted that on January 5, 2016, Governor Snyder declared a state of emergency for Flint, which the Legislature has extended through April 14, 2016.
Today in Flint, Governor Snyder is scheduled to announce a state contract aimed at assessing and identifying high-risk lead pipes in the city. This is likely the first of many contracts surrounding this issue. Additionally, HB 4455, sponsored by Rep. Glardon (R-Owosso), will be soon be heading to the Governor’s desk. Rep. Glardon states the legislation will permit the Michigan Department of Transportation “to focus its inspection program on the state’s most dangerous bridges to help ensure the department is using its time wisely to best protect Michigan residents.”