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New law to keep sole-sourcing in check; two more procurement reform bills filed

By Pacific Island Times News Staff

Gov. Lou Leon Guerrero has signed a law authorizing the government to scrap a sole-sourced contract if it determines that better deals are available.

Substitute Bill 182-36, now known as Public Law 36-70, is the latest effort to reform government procurement, the governor said.

The law limits the term of a contract procured through sole-sourcing and requires market research to justify using such as method.

"If a similar supply or service is available, the specifications justifying a sole source contract must be scrutinized, and where there is reasonable doubt that the minimum needs of the government were not specified, the sole source contract shall be terminated and a competitive method of source selection shall be used," the law reads.

In a message to Speaker Therese Terlaje, the governor said P.L. 36-70 "addresses longstanding gaps in sole-source procurement practices, which notably includes requiring a written determination that the contract price involved in the procurement is fair and reasonable, based on relevant cost and price information for the supply or service."

"The amendments to the sole source processes reflected in this law bolster transparency, accountability, and ultimately public confidence in our procurement processes as a whole," she added.

Following the enactment of P.L. 36-70, two new procurement-related bills were introduced in the 36th Guam Legislature this week.

Sen. Sabina Perez

Sen. Sabina Perez, the author of P.L. 36-70, introduced another bill seeking to increase transparency for small purchases in government "that can foster competition and ensure fair value."

Bill 236-36 aims to prevent the misuse of the small purchase procedures by not allowing a “no quote” quotation to be used. The bill requires the agency utilizing small purchases to obtain three positive quotes from qualified sources or attest that the three positive quotes were not obtainable.

“Local procurement laws safeguard public funds through transparency and accountability measures. Bill 236-36 aims to protect the public interest and promote sustainability through better stewardship of government funds,” Perez said.


Another bill, introduced by Sen. James Moylan, seeks to "enhance favorable procurement policies" for Disability-Owned Business Enterprises or DOBE.

Bill 235-36 would create two new categories of related businesses that would qualify for the government procurement's preferential points.

Sen. James Moylan

These two proposed classifications are: Disability-Owned Business Enterprise (DOBE), which is a business primarily owned by an individual with a disability; and Veteran Disability-Owned Business Enterprise (V-DOBE), which is a business primarily owned by a veteran with a disability, where the disability did not occur during their tenure while in service.

Under the current statute, preferential treatments are given only to businesses owned by veterans "who suffered a disability during their tenure in service."

“The intent of the legislation is to not only modify the current statute, but to also bring light to encouraging the growth of small businesses, inclusive with those residents who are either veterans or individuals with disabilities," Moylan said.

"Whether their objective is to provide products or services to the local government, or the community in general, by securing national certifications, would also open many doors for grants and other services. With the current state of our economy, as a government, we need to create opportunities for financial independence, and simple measures such as Bill 235 can assist in the process,” he added.

The bill also seeks to explore other opportunities that can be offered to veterans and individuals with disabilities, Moylan said.

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