Legislators advance proposal to shed light on Utah’s no-bid emergency contracts

The state bill would limit the length of these contracts to 30 days under most circumstances.

(Trent Nelson | Tribune file photo) Workers organize supplies at the Receiving, Staging and Shipping Center at the Salt Palace Convention Center in Salt Lake City on May 8, 2020. The center served as a central location for personal protective equipment received by the State of Utah and sent to hospitals, local health departments and emergency managers.

A proposal that would blunt the emergency spending powers of Utah’s executive branch continues to progress through the Legislature, following calls for greater transparency in the state’s early pandemic contracts.

These concerns stemmed from the millions of dollars in state spending on no-bid contracts last spring, when then-Gov. Gary Herbert’s administration was racing to stand up its public health effort. In so doing, state officials temporarily suspended their standard procurement rules, saying the usual process would’ve taken far too long in the scramble to secure personal protective equipment and testing supplies that were in global demand, along with controversial anti-malaria drugs.

Rep. Candice Pierucci says a bill she’s brought forward in response to these purchases would allow “the executive branch to be both nimble and responsive while also putting guardrails and checkpoints into place to encourage transparency, accountability and ultimately the competitive bid process.”

Her legislation, which passed out of the House Government Operations Committee on Thursday, would stipulate that a no-bid emergency contract could last no longer than 30 days in most cases, although it could extend to 60 days during natural disasters. Natural disasters would include explosions, fires, floods, storms and earthquakes, but COVID-19 would not have fit the definition, she told her colleagues.

Pierucci, R-Riverton, said she lengthened the time frame for emergency contracts related to a natural disaster because storm or earthquake response efforts often last longer than a month.

“We had a banner year in 2020, and we had some crazy winds, and the cleanup for that project went beyond a 30-day window,” she told the committee. “The goal in this was not to hit hard at the executive branch. It was trying to work with them and acknowledge that certain situations may take longer.”

After the emergency contracts expire, the state would be free to use the same vendor so long as it first went through the standard procurement process.

The measure, HB43, would also require the state to post the emergency contract online within 14 days of the procurement, along with a “written document describing the specific emergency” involved and the name of the highest-ranking government who approved the purchase.

Understanding the rationale for some of Utah’s no-bid purchases has proven elusive at times during the pandemic, with state auditors reporting that a flurry of spending and technology happened through verbal negotiations and approvals with a minimal paper trail.

In the case of a controversial hydroxychloroquine purchase, state auditors couldn’t even determine who approved spending $800,000 on the malaria drug that had been touted by then-President Trump as a treatment to COVID-19.

“Without written documentation of authorization (or explicit verbal authorization), it is impossible to determine exactly how this occurred,” the auditors wrote. “We are concerned that this purchase occurred without anyone’s explicit authorization.”

The medication order was later reversed, and the state received a full refund.

“Sometimes we don’t realize the deficiencies in some of our policies until we have events that reveal those,” Rep. Phil Lyman, R-Blanding, said during Thursday’s committee hearing. “So I really applaud the sponsor for taking a real practical approach to the problem that’s kind of shown itself this last year.

Now that the bill has cleared committee, it will move to the House floor for a vote.