KRS 164A.575: Purchasing -- Inventories -- Lease renewals -- Sales of surplus property --

Bidding procedures -- Kentucky-grown agricultural products -- Reports --

Capital construction projects and equipment not listed in budget bill --

Reciprocal preference for resident bidders -- Reverse auctions.

(1) The governing boards of each institution may elect to purchase interest in real

property, contractual services, rentals of all types, supplies, materials, equipment,

printing, and services, except that competitive bids may not be required for:

(a) Contractual services where no competition exists;

(b) Food, clothing, equipment, supplies, or other materials to be used in

laboratory and experimental studies;

(c) Instructional materials available from only one (1) source;

(d) Where rates are fixed by law or ordinance;

(e) Library books;

(f) Commercial items that are purchased for resale;

(g) Professional, technical, scientific, or artistic services, but contracts shall be

submitted in accordance with KRS 45A.690 to 45A.725;

(h) All other commodities, equipment, and services which, in the reasonable

discretion of the board, are available from only one (1) source; and

(i) Interests in real property.

(2) Nothing in this section shall deprive the boards from negotiating with vendors who

maintain a General Services Administration price agreement with the United States

of America or any agency thereof, provided, however, that no contract executed

under this p rovision shall authorize a price higher than is contained in the contract

between General Services Administration and the vendor affected.

(3) The governing board shall require the institution to take and maintain inventories of

plant and equipment.

(4) The governing board shall establish procedures to identify items of common

general usage among all departments to foster volume purchasing. It shall establish

and enforce schedules for purchasing supplies, materials, and equipment.

(5) The governing board sh all have power to salvage, to exchange, and to condemn

supplies, equipment, and real property.

(6) Upon the approval of the secretary of the Finance and Administration Cabinet, the

governing board may purchase or otherwise acquire all real property determi ned to

be needed for the institution's use. The amount paid shall not exceed the fair market

value as determined by a qualified appraiser or the value set by the eminent domain

procedure. Any real property acquired under this section shall be in name of th e

Commonwealth for the use and benefit of the institution.

(7) (a) Notwithstanding KRS 56.806, the governing board may renegotiate the cost

of a lease after the expiration of the lease term and any renewal terms

provided in the lease prior to any renewal n ot provided for in the terms of the

lease.

(b) Except when a lease incorporates a lease -purchase under KRS 56.806, the

governing board shall reserve the right to cancel a lease upon at least thirty

(30) days' written notice.

(c) Notwithstanding KRS 56.823(2) and (3), any lease renewals, except automatic

renewals permitted under KRS 56.803, 56.805(2), and 56.806(1), for which

the annual rental cost will exceed two hundred thousand dollars ($200,000)

shall be reported to the Capital Projects and Bond Oversight Committee in the

same format as set out in KRS 56.823(2).

(d) Notwithstanding KRS 56.813, a public college or university may pay for

improvements to leased property costing in excess of ten thousand dollars

($10,000) but less than one million dollars ($1 ,000,000) in a lump sum upon

approval of its board using non -general fund appropriations and without

incurring debt.

(8) The governing board shall sell or otherwise dispose of all real or personal property

of the institution which is not needed or has beco me unsuitable for public use, or

would be more suitable consistent with the public interest for some other use, as

determined by the board. The determination of the board shall be set forth in an

order, and shall be reached only after review of a written r equest by the institution

desiring to dispose of the property. Such request shall describe the property and

state the reasons why the institution believes disposal should be effected. All

instruments required by law to be recorded which convey any interest in any such

real property so disposed of shall be executed and signed by the appropriate officer

of the board. Unless the board deems it in the best interest of the institution to

proceed otherwise, all such real or personal property shall be sold either by

invitation of sealed bids or by public auction; provided, however, that the selling

price of any interest in real property shall not be less than the fair market value

thereof as determined by the Finance and Administration Cabinet or the

Transportation Cabinet for such requirements of that department.

(9) Real property or any interest therein may, subject to the provisions of KRS Chapter

45A, be purchased, leased, or otherwise acquired from any officer or employee of

any board of the institution, based upon a written application by the grantor or

lessor approved by the board, that the employee has not either himself or through

any other person influenced or attempted to influence either the board requesting

the purchase of the property. In any case in wh ich such an acquisition is

consummated, the said request and finding shall be recorded and kept by the

Secretary of State along with the other documents recorded pursuant to the

provisions of KRS Chapter 56.

(10) (a) As used in this section, "construction manager-agency," "construction

management-at-risk," "design -bid-build," "design -build," and "construction

manager-general contractor" shall have the same meaning as in KRS

45A.030.

(b) For capital construction projects, the procurement may be on a total de sign-

bid-build basis, a design -build basis, construction manager -general contractor

basis, or construction management-at-risk basis, whichever in the judgment of

the board offers the best value to the taxpayer. Best value shall be determined

in accordance with KRS 45A.070. Proposals shall be reviewed by the

institution's engineering staff to assure quality and value, and compliance with

procurement procedures. All specifications shall be written to promote

competition. Services for projects delivered on the design-build basis,

construction manager -general contractor basis, or construction management -

at-risk basis shall be procured in accordance with KRS 45A.180, KRS

45A.183, and the regulations promulgated in accordance with KRS 45A.180.

Nothing in this sect ion shall prohibit the procurement of construction

manager-agency services.

(c) Notwithstanding KRS 45A.185, for all capital construction projects, bidder

security for competitive sealed bidding for construction contracts shall only be

required when the pr ice is estimated to exceed one million dollars

($1,000,000).

(11) The governing board shall attempt in every practicable way to insure the

institution's supplying its real needs at the lowest possible cost. To accomplish this

the board may enter into coope rative agreements with other public or private

institutions of education or health care.

(12) The governing board shall have control and supervision over all purchases of

energy consuming equipment, supplies, and related equipment purchased or

acquired by the institution, and shall designate by regulation the manner in which

an energy consuming item will be purchased so as to promote energy conservation

and acquisition of energy efficient products.

(13) The governing board may negotiate directly for the pur chase of contractual

services, supplies, materials, or equipment in bona fide emergencies regardless of

estimated costs. The existence of the emergency must be fully explained, in writing,

by the vice president responsible for business affairs and such exp lanation must be

approved by the institution president. The letter and approval shall be filed with the

record of all such purchases. Where practical, standard specifications shall be

followed in making emergency purchases. A good faith effort shall be mad e to

effect a competitively established price for emergency purchases.

(14) (a) All governing boards that purchase agricultural products, as defined by KRS

45A.630, shall, on or before January 1 of each year, provide a report to the

Legislative Research Co mmission and to the Department of Agriculture

describing the types, quantities, and costs of each product purchased. The

report shall be completed on a form provided by the department.

(b) If purchasing agricultural products, a governing board shall encour age the

purchase of Kentucky -grown agricultural products in accordance with KRS

45A.645. If a governing board purchases agricultural products through a

contract with a vendor or food service provider, the contract shall require that

if Kentucky-grown agricultural products are purchased, the products shall be

purchased in accordance with KRS 45A.645. Only contracts entered into or

renewed after July 15, 2008, shall be required to comply with the provisions

of this subsection.

(c) All governing boards that pu rchase Kentucky -grown agricultural products

shall, on or before January 1 of each year, provide a report to the Legislative

Research Commission and to the Department of Agriculture describing the

types, quantities, and costs of each product purchased. The report shall be

completed on a form provided by the department.

(15) Notwithstanding KRS 45.760, the governing board may authorize a capital

construction project or a major item of equipment even though it is not specifically

listed in any branch budget bill, subject to the following conditions and procedures:

(a) The full cost shall be funded solely by non-general fund appropriations;

(b) Moneys specifically budgeted and appropriated by the General Assembly for

another purpose shall not be allotted or real lotted for expenditure on the

project or major item of equipment. Moneys utilized shall not jeopardize any

existing program and shall not require the use of any current general funds

specifically dedicated to existing programs; and

(c) The institution's president, or designee, shall submit the project or major item

of equipment to the Capital Projects and Bond Oversight Committee for

review as provided by KRS 45.800.

(16) Governing boards shall apply the reciprocal resident bidder preference described in

KRS 45A.494 prior to the award of any contract.

(17) Governing boards may authorize the use of reverse auctions as defined in KRS

45A.070 for the procurement of goods and leases.