Legislature(2007 - 2008)BELTZ 211
04/24/2007 09:00 AM Senate STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB109 | |
| SB95 | |
| SB134 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 109 | TELECONFERENCED | |
| += | SB 95 | TELECONFERENCED | |
| += | SB 134 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 95 - COMPETITIVE BIDDING FOR BALLOT PREP
9:39:22 AM
CHAIR MCGUIRE announced the consideration of SB 95.
SENATOR BUNDE, sponsor of SB 95, said this is a bill by request
from a vendor who was not allowed to bid for a ballot printing
contract. He said the State of Alaska does a lot of business
with small and large businesses in Alaska, and state spending is
a huge factor in the state's economy. The state utilizes
competitive bidding in many areas, but surprisingly does not do
so for printing state ballots. He believes the process ought to
be open to competitive bidding.
SB 95 allows for competitive bidding for printing ballots. It is
clear that because the integrity of ballots is critical to the
election process, their printing does not necessarily have to go
through the Procurement Code. However, the Division of Elections
could develop its own regulations for competitive bidding so its
unique specifications could be met to insure integrity. It seems
difficult to believe that only one printer in the State of
Alaska could meet the criteria.
9:42:19 AM
WHITNEY BREWSTER, Director, Division of Elections, said while
she understands Senator Bunde's position, the most important
aspect of the election is the ballot. It is extremely important
for the division to have some sort of certainty that the ballots
are being prepared correctly; including correctly placed timing
marks, proper paper, and correct fold locations so that the oval
will be read on an optical scan unit.
MS. BREWSTER said certainty is important in an environment where
there are challenges to the ballot. She reminded the committee
that a court order in 2004 required the ballots be reprinted. It
is important that the division have a vendor who will stick by
it in difficult times. In that case, the printer worked around
the clock to get the second batch of ballots printed in time to
be tested and distributed to the regional offices.
She said rapport and trust are very important in considering who
ultimately prints the ballots. After hearing Senator Bunde's
intent that the division creates its own procurement process
some of her concerns are relieved. However, the process would
need to be started two or three months prior to an election to
accommodate all the other deadlines the division faces.
MS. BREWSTER said she is unclear whether the bidding would be
open to any vendor who owns an Alaska business license. If this
is the case, a job could potentially go to an out-of-state
vendor who holds an Alaskan business license. Then the division
may have to deal with the possibility of ballots being damaged,
which has occurred when out-of-state vendors have been used in
the past. It could be difficult to get that kind of problem
corrected very close to election time.
9:47:15 AM
MS. BREWSTER also said the law indicates absentee ballots are to
be sent out as soon as they are ready for distribution. The
division currently has a vendor who prints the ballot and hand
delivers them to each election office, except Nome, where they
get mailed. This allows the division to get them ready for
distribution almost immediately, increasing the chance that they
will get absentee ballots to the voter and back in time to be
counted for an election. This is especially important to
military and overseas voters. In all practicality the mail
service sometimes does not deliver the ballot in time to be
counted in an election. Additionally, when dealing with an out-
of-state vendor, Alaska may fall low on the priority list. A
vendor may be printing millions of ballots for Los Angeles, for
instance. The division has faced this problem in other areas.
She said the Division of Elections goes through the procurement
process on everything except ballot printing and transportation.
Her opinion is the process now works very well and she wants it
kept as is.
SENATOR BUNDE said he does not believe the division has to go
through the procurement process to have competitive bidding. He
thinks the division can develop its own criteria and a legal
opinion suggests he is correct. He said that everything that Ms.
Brewster mentioned could be addressed with another printer.
Another printer would not be selected if it couldn't do the job.
There is the argument of convenience, but all state departments
would like the convenience of single sourcing. The division
could write in a preference for in-state contractors as is done
in the procurement process and the transportation issue could be
addressed in the bid criteria. Bid criterion could take care of
a lot of the division's concerns.
9:51:42 AM
SENATOR STEVENS asked how the division arrives at a price and is
assured the state is getting a good deal when working with one
printer.
MS. BREWSTER replied that the ballot cost for the special
election was $120,000. For the 2006 primary it was roughly
$190,000. The division looked at the cost comparison of Sequoia,
the printer used before 2002, and Printworks, the current
printer. At the time Printworks was the only Diebold certified
printer in the State and that was a determining factor for
selecting them. From that point there have been nominal changes.
The ballot price has increased one cent per ballot since that
time.
SENATOR STEVENS asked if she has done a comparison of other
printers since then.
MS. BREWSTER replied no.
9:53:52 AM
PATRICK FOSTER, A.T. Publishing, Anchorage, said he has worked
in the print industry in Alaska for nearly 30 years and supports
SB 95. He said Alaska has several companies capable of printing
the ballots. The state uses Diebold electronic ballot leaders to
tally results for elections and Diebold must certify ballots
destined for their machines. At the time Alaska started using
ballot leaders, no Alaskan company was certified. Shortly
thereafter, one shop was certified and has been handed the jobs
ever since, despite the desire of other companies to be included
in the bid process.
MR. FOSTER said A.T. Publishing became a Diebold certified
printer in 2003. The division likely has a comfort level working
with the same printer, but Mr. Foster makes a living trying to
provide his clients with the same level of comfort. He recently
won the ballot-printing contract with the Municipality of
Anchorage, after the contract was put out for competitive bid.
The municipal clerk was initially concerned about an open bid,
but then found that the transition was easy and the city saved
money.
Some claim the complexity of Alaska ballots is reason enough to
keep things as they are and could be daunting for some small
shops, but there are many companies in Alaska capable of
handling the volume of work in the time required. Competitive
bidding for ballot printing would probably save the state money
and allow more companies to upgrade their facilities and improve
their standing in the industry.
9:57:55 AM
SENATOR BUNDE noted for the record a potential conflict because
Mr. Foster resides in his district.
CHAIR MCGUIRE acknowledged the potential conflict.
SENATOR STEVENS asked if Alaskan printers would have an
advantage or disadvantage competing with out-of-state vendors.
MR. FOSTER said he competes with many lower-48 businesses. The
Alaska product preference rules level the playing field. He
noted that the City of Anchorage was using Diebold directly, for
five years, and when the contract went out for bid, shipping
proved to be a disadvantage for out of state printers. He
surmised that half a dozen to a dozen companies statewide can
effectively compete.
CHAIR MCGUIRE commented that Alaska product preference rules
could be included in the division's procurement process. She
also maintained it would be constitutionally upheld to require
the bid stay in Alaska. Shipping and timing make a clear
argument for that and more points could be given in these areas.
10:01:11 AM
JASON HOOLEY, Office of Lieutenant Governor, said his office
does not oppose the legislation but echoes the concerns raised
by Ms. Brewster. He said the provision has been on the books
since 1960 and has served the division, voters, and vendors
well. However, the division's primary loyalty is to the voters
rather than to a particular vendor.
He noted that Alaska is not the only jurisdiction with a closed-
bid process. Three other states have a closed bid process and
some counties in other states use sole-source bidding.
10:03:38 AM
CHAIR MCGUIRE asked how many of the 46 open bid states follow
the proposed procedure.
SENATOR BUNDE added that the state has used a variety of vendors
since 1960 despite the fact that the closed bid provision has
been on the books.
MR. HOOLEY agreed.
MS. BREWSTER replied each state is different. In Alaska, state
and federal elections are conducted by the State Division of
Elections, whereas in other states individual counties conduct
state and federal elections. The 46 states mentioned earlier are
not necessarily using open bidding statewide for their ballot
printing. Within a state, one county may sole-source while
another may have an open bidding process.
CHAIR MCGUIRE asked if the states conduct their own state
elections.
MS. BREWSTER replied no.
10:06:37 AM
SENATOR STEVENS asked for clarification on Alaska product
preference rules.
MS. BREWSTER said she is not an expert on the procurement code
and declined to answer.
ONNIE KENDALL, Manager, Service Business Printing, Anchorage,
said he supports the bill because the current situation is not
good for the state or the printing community. Since the project
is currently sole sourced the state is not receiving a price
balanced by the competitive process.
10:07:57 AM
CHAIR MCGUIRE asked if Mr. Kendall's company is different from
Mr. Foster's and if it can bid on something like this.
MR. KENDALL answered yes to both.
CHAIR MCGUIRE closed public testimony on SB 95.
CHAIR MCGUIRE noted Amendment 1 from Senator Bunde, labeled 25-
LS0638\A.1, as follows:
Page 1, line 1:
Delete "a requirement for competitive bidding on"
Insert "the State Procurement Code and"
Page 2, lines 1 - 2:
Delete "for the preparation of ballots by [WITHOUT]
obtaining competitive bids"
Insert "under AS 36.30 (State Procurement Code) for the
preparation of ballots [WITHOUT OBTAINING COMPETITIVE BIDS]"
Page 4, following line 1:
Insert new bill sections to read:
"* Sec. 2. AS 36.30.850(b)(7) is amended to read:
(7) contracts for the [PREPARATION AND]
transportation of ballots under AS 15;
* Sec. 3. The uncodified law of the State of Alaska is
amended by adding a new section to read:
APPLICABILITY. This Act applies to contracts for the
preparation of ballots for elections conducted on or after
January 1, 2008."
SENATOR BUNDE said the amendment was written in case the
committee felt it was needed, but he didn't believe it was
necessary or advisable to require the division to go through the
full procurement process.
CHAIR MCGUIRE agreed.
10:09:21 AM
SENATOR GREEN said it sounds like the Anchorage put its bid out
for multiple years. She asked if that was the intention of this
bill or would there be a new bid for every election.
SENATOR BUNDE said that isn't his intention but he would leave
that decision to the Division of Elections to make it work best
for them. He suspects a multiple year bid would be more
economical.
10:10:09 AM
CHAIR MCGUIRE said Mr. Foster recommended each bid be awarded
for an election cycle with a performance option for a second
cycle and the bill gives the division that kind of discretion.
CHAIR MCGUIRE anticipates the division will look at vendors
without being preferential. She would like to encourage the
Alaska bidding preference.
SENATOR STEVENS asked if a requirement for an Alaskan preference
should be considered to address the division's concerns about
the problems with shipping and timing.
SENATOR BUNDE said he is no expert on procurement code, but has
a legal opinion stating this bill would not have to go under
that code. He believes that after hearing Ms. Brewster's
testimony the division would include an Alaskan preference.
10:12:45 AM
CHAIR MCGUIRE asked Ms. Brewster if conceptual language should
be added for an Alaskan preference in the competitive bid
process.
MS. BREWSTER said she didn't think it was necessary.
SENATOR GREEN said Amendment 1 has applicability language and
the legislation does not. She asked if an applicability date
should be added.
10:14:37 AM
MS. BREWSTER answered it would be advantageous to have an
applicability date.
SENATOR BUNDE asked if it would be feasible to apply these
provisions to the next general election to give a year and half
lead time.
MS. BREWSTER answered it would be preferable to apply this to
both a primary and general so the division is dealing with the
same vendor for both elections.
SENATOR BUNDE clarified that he is referring to the next general
election cycle.
10:16:21 AM
SENATOR BUNDE moved to adopt a conceptual amendment "that the
date of application would be the next statewide general election
cycle, or whatever the proper terms would be."
CHAIR MCGUIRE said the conceptual amendment would be a new
section 2, an applicability clause.
SENATOR BUNDE restated the conceptual amendment as "ballot
procurement would apply to the next general election cycle,
January 1, 2008, perhaps."
MS. BREWSTER said that date would work.
10:18:01 AM
SENATOR GREEN asked when the contract with the current vendor
ends.
MS. BREWSTER replied that contracts go from election to
election.
CHAIR MCGUIRE announced there were no further objections so
conceptual Amendment 2 was adopted.
10:19:29 AM
SENATOR BUNDE said none of this should be interpreted as a
criticism of the Division of Elections. This is an issue of
fairness and he reminded the committee that the current vendor
may be the successful applicant in the future.
SENATOR BUNDE moved to report SB 95 as amended from committee
with individual recommendations and attached fiscal note. There
being no objection, CSSB 95(STA) moved from the Senate State
Affairs Committee.
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