State Procurement Preferences

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Disadvantaged Business Enterprise (DBE)

Montana law does not grant preference to small businesses or disadvantaged businesses including women- or minority-owned companies. Information on minority business enterprises (MBE) and women's business enterprises (WBE) can be obtained by contacting the Montana Department of Transportation Disadvantaged Business Enterprise (DBE) Program.

Reciprocal Preference Law

Reciprocal preference, outlined in Title 18, Chapter 1, Part 1, Montana Code Annotated (MCA), provides a Montana resident bidder a preference against the bid of a nonresident bidder from any state or country that allows a preference for its resident bidders. These preferences are applied by state agencies to Invitation for Bids (IFBs) for the purchase of goods and printing and for construction, repair, and public works of all kinds, including nonconstruction services, with a total contract value of greater than $25,000.

A Montana public agency, when determining the lowest responsive and responsible bidder, applies the reciprocal preference to the bid of a nonresident bidder equal to the percent of the preference given to the bidder in their resident state or country. The reciprocal preference is only applied against other states and countries and not other public entities such as political subdivisions. For instance, if the low bidder is from a state that grants a 10% preference to its own resident bidders, 10% must be added to that bidder's price if it would benefit a Montana resident bidder. Political subdivisions (including local governments) are only required to apply the reciprocal preference to IFBs for construction, repair, and public works and not to IFBs for the purchase of goods and printing.

The State of Oregon maintains a website that provides information on preference laws for all states. The preference law information is reviewed and updated annually.

Please note: If it appears that a reciprocal preference may apply, contact Meghan Holmlund at (406) 444-1459 or mholmlund@mt.gov.

Application under the Montana Procurement Act

(1) Procurement officers must apply a reciprocal preference to IFBs for goods, printing, and nonconstruction services for public works, but only if federal funds are not involved and only if it will benefit a Montana resident bidder (ARM 2.5.408(2)). "Nonconstruction services" as defined in 18-2-401(9), MCA, means work performed by an individual, not including management, office, or clerical work, for:

  • the maintenance of publicly owned buildings and facilities, including public highways, roads, streets, and alleys;
  • custodial or security services for publicly owned buildings and facilities;
  • grounds maintenance for publicly owned property;
  • the operation of public drinking water supply, waste collection, and waste disposal systems;
  • law enforcement, including janitors and prison guards;
  • fire protection;
  • public or school transportation driving;
  • nursing, nurse's aid services, and medical laboratory technician services;
  • material and mail handling;
  • food service and cooking;
  • motor vehicle and construction equipment repair and servicing; and
  • appliance and office machine repair and servicing.

(2) A resident bidder must complete a Montana Resident Preference Affidavit to verify resident eligibility and this affidavit must be on file with the State Financial Services Division before a bid award can be made. If the nonresident bidder is still the lowest responsive and responsible bidder after the preference adjustment has been made, the contract price is the price bid, not the adjusted price (ARM 2.5.408(4)).

(3) The business name and federal identification number on the Montana Resident Preference Affidavit must match the business name and federal identification number on the submitted bid documents in order to be considered for the application of reciprocal preference (ARM 2.5.408(5)).

(4) In addition to the reciprocal preference, in case of a tie bid, preference must be given to the bidder, if any, offering American-made products or supplies (18-4-303(10), MCA).

 

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