1.1.................... moves to amend H.F. No. 557, the first engrossment, as follows:
1.2Page 1, line 9, after "veteran-owned" insert "small"
1.3Page 2, after line 25, insert:

1.4    "Sec. 3. Minnesota Statutes 2008, section 16C.20, is amended to read:
1.516C.20 CERTIFICATION.
1.6A business that is certified by the commissioner of administration as a small
1.7business, small targeted group business, or a small business located in an economically
1.8disadvantaged area, or a veteran owned small business is eligible to participate under the
1.9requirements of sections 137.31 and 161.321 and, if certified as a small business, or small
1.10targeted group business, or veteran owned small business, under section 473.142 without
1.11further certification by the contracting agency.
1.12EFFECTIVE DATE.This section is effective July 1, 2009, and applies to
1.13procurement contract bid solicitations issued on and after that date.

1.14    Sec. 4. Minnesota Statutes 2008, section 161.321, is amended to read:
1.15161.321 SMALL BUSINESS CONTRACTS.
1.16    Subdivision 1. Definitions. For purposes of this section the following terms have
1.17the meanings given them, except where the context clearly indicates a different meaning is
1.18intended.
1.19(a) "Award" means the granting of a contract in accordance with all applicable laws
1.20and rules governing competitive bidding except as otherwise provided in this section.
1.21(b) "Contract" means an agreement entered into between a business entity and the
1.22state of Minnesota for the construction of transportation improvements.
1.23(c) "Subcontractor" means a business entity which enters into a legally binding
1.24agreement with another business entity which is a party to a contract as defined in
1.25paragraph (b).
2.1(d) "Targeted group business" means a business designated under section 16C.16,
2.2subdivision 5 .
2.3(e) "Veteran owned small business" means a business designated under section
2.416C.16, subdivision 6a.
2.5    Subd. 2. Small business set-asides. (a) The commissioner may award up to a six
2.6percent preference in the amount bid for specified construction work to small targeted
2.7group businesses and veteran owned small businesses.
2.8(b) The commissioner may designate a contract for construction work for award only
2.9to small targeted group businesses if the commissioner determines that at least three small
2.10targeted group businesses are likely to bid. The commissioner may designate a contract for
2.11construction work for award only to veteran owned small businesses if the commissioner
2.12determines that at least three veteran owned small businesses are likely to bid.
2.13(c) The commissioner, as a condition of awarding a construction contract, may
2.14set goals that require the prime contractor to subcontract a portion of the contract to
2.15small targeted group businesses and veteran owned small businesses. The commissioner
2.16must establish a procedure for granting waivers from the subcontracting requirement
2.17when qualified small targeted group businesses and veteran owned small businesses
2.18are not reasonably available. The commissioner may establish financial incentives for
2.19prime contractors who exceed the goals for use of subcontractors and financial penalties
2.20for prime contractors who fail to meet goals under this paragraph. The subcontracting
2.21requirements of this paragraph do not apply to prime contractors who are small targeted
2.22group businesses or veteran owned small businesses.
2.23(d) The commissioner may award up to a four percent preference in the amount bid
2.24on procurement to small businesses located in an economically disadvantaged area as
2.25defined in section 16C.16, subdivision 7.
2.26    Subd. 3. Awards to small businesses. At least 75 percent of subcontracts awarded
2.27to small targeted group businesses must be performed by the business to which the
2.28subcontract is awarded or another small targeted group business. At least 75 percent
2.29of subcontracts awarded to veteran owned small businesses must be performed by the
2.30business to which the subcontract is awarded or another veteran owned small business.
2.31    Subd. 4. Awards, limitations. Contracts awarded pursuant to this section are
2.32subject to all limitations contained in rules adopted by the commissioner of administration.
2.33    Subd. 5. Recourse to other businesses. If the commissioner is unable to award
2.34a contract pursuant to the provisions of subdivisions 2 and 3, the award may be placed
2.35pursuant to the normal solicitation and award provisions set forth in this chapter and
2.36chapter 16C.
3.1    Subd. 6. Rules. The rules adopted by the commissioner of administration to define
3.2small businesses and to set time and other eligibility requirements for participation in
3.3programs under sections 16C.16 to 16C.19 apply to this section. The commissioner may
3.4promulgate other rules necessary to carry out this section.
3.5    Subd. 7. Noncompetitive bids. The commissioner is encouraged to purchase
3.6from small targeted group businesses and veteran owned small businesses designated
3.7under section 16C.16 when making purchases that are not subject to competitive bidding
3.8procedures.
3.9    Subd. 8. Report by commissioner. The commissioner of transportation shall report
3.10to the commissioner of administration on compliance with this section. The information
3.11must be reported at the time and in the manner requested by the commissioner.
3.12EFFECTIVE DATE.This section is effective July 1, 2009, and applies to
3.13procurement contract bid solicitations issued on and after that date.

3.14    Sec. 5. Minnesota Statutes 2008, section 473.142, is amended to read:
3.15473.142 SMALL BUSINESSES.
3.16(a) The Metropolitan Council and agencies specified in section 473.143, subdivision
3.171 , may award up to a six percent preference in the amount bid for specified goods or
3.18services to small targeted group businesses and veteran owned small businesses designated
3.19under section 16C.16.
3.20(b) The council and each agency specified in section 473.143, subdivision 1, may
3.21designate a purchase of goods or services for award only to small targeted group businesses
3.22designated under section 16C.16 if the council or agency determines that at least three
3.23small targeted group businesses are likely to bid. The council and each agency specified in
3.24section 473.143, subdivision 1, may designate a purchase of goods or services for award
3.25only to veteran owned small businesses designated under section 16C.16 if the council or
3.26agency determines that at least three veteran owned small businesses are likely to bid.
3.27(c) The council and each agency specified in section 473.143, subdivision 1, as a
3.28condition of awarding a construction contract or approving a contract for consultant,
3.29professional, or technical services, may set goals that require the prime contractor to
3.30subcontract a portion of the contract to small targeted group businesses and veteran
3.31owned small businesses designated under section 16C.16. The council or agency must
3.32establish a procedure for granting waivers from the subcontracting requirement when
3.33qualified small targeted group businesses and veteran owned small businesses are not
3.34reasonably available. The council or agency may establish financial incentives for
3.35prime contractors who exceed the goals for use of subcontractors and financial penalties
4.1for prime contractors who fail to meet goals under this paragraph. The subcontracting
4.2requirements of this paragraph do not apply to prime contractors who are small targeted
4.3group businesses and veteran owned small businesses. At least 75 percent of the value of
4.4the subcontracts awarded to small targeted group businesses under this paragraph must
4.5be performed by the business to which the subcontract is awarded or by another small
4.6targeted group business. At least 75 percent of the value of the subcontracts awarded to
4.7veteran owned small businesses under this paragraph must be performed by the business
4.8to which the subcontract is awarded or another veteran owned small business.
4.9(d) The council and each agency listed in section 473.143, subdivision 1, are
4.10encouraged to purchase from small targeted group businesses and veteran owned small
4.11businesses designated under section 16C.16 when making purchases that are not subject to
4.12competitive bidding procedures.
4.13(e) The council and each agency may adopt rules to implement this section.
4.14(f) Each council or agency contract must require the prime contractor to pay any
4.15subcontractor within ten days of the prime contractor's receipt of payment from the
4.16council or agency for undisputed services provided by the subcontractor. The contract
4.17must require the prime contractor to pay interest of 1-1/2 percent per month or any
4.18part of a month to the subcontractor on any undisputed amount not paid on time to the
4.19subcontractor. The minimum monthly interest penalty payment for an unpaid balance of
4.20$100 or more is $10. For an unpaid balance of less than $100, the prime contractor shall
4.21pay the actual penalty due to the subcontractor. A subcontractor who prevails in a civil
4.22action to collect interest penalties from a prime contractor must be awarded its costs and
4.23disbursements, including attorney fees, incurred in bringing the action.
4.24(g) This section does not apply to procurement financed in whole or in part
4.25with federal funds if the procurement is subject to federal disadvantaged, minority, or
4.26women business enterprise regulations. The council and each agency shall report to the
4.27commissioner of administration on compliance with this section. The information must be
4.28reported at the time and in the manner requested by the commissioner.
4.29EFFECTIVE DATE.This section is effective July 1, 2009, and applies to
4.30procurement contract bid solicitations issued on and after that date."