HOUSE BILL NO. 515

INTRODUCED BY L. GRINDE, C. SWYSGOOD, C. AHNER, J. BARNETT, T. BECK, E. BERGSAGEL, P. BERGSAGEL, A. BISHOP, S. BOOKOUT-REINICKE, M. BRAINARD, R. BROWN, J. COBB, M. COLE, B. CRIPPEN, B. DEPRATU, G. DEVLIN, S FISHER, D. FUCHS, D. GRIMES, M. HANSON, D. HARGROVE, J. HARP, D. HEDGES, J. HERTEL, D. MCGEE, J. MERCER, B. MOLNAR, D. MOOD, K. OHS, B. RANEY, B. SIMON, P. SLITER, R. SOMERVILLE, M. SPRAGUE, B. TASH, M. TAYLOR, F. THOMAS, J. WITT

A BILL FOR AN ACT ENTITLED: "AN ACT CREATING A FREEDOM FROM GOVERNMENT COMPETITION ACT; PROVIDING FOR REVIEWING AUTHORITIES TO DETERMINE IF AN ACTIVITY OF A GOVERNMENT ENTITY VIOLATES NONCOMPETE PROVISIONS; PROVIDING A HEARING PROCEDURE TO REVIEW COMPLAINTS OF ACTIONS BY GOVERNMENT ENTITIES IN VIOLATION OF NONCOMPETE PROVISIONS; PROVIDING JUDICIAL REMEDIES FOR ALLEGATIONS OF VIOLATIONS BY GOVERNMENT ENTITIES OF NONCOMPETE PROVISIONS; PROVIDING FOR AN INTERIM STUDY OF THE EFFECTS OF COMPETITION BY STATE POLITICAL SUBDIVISIONS WITH THE PRIVATE SECTOR; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE."

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

NEW SECTION. Section 1. Short title. [Sections 1 through 5] may be cited as the "Montana Freedom From Government Competition Act".

NEW SECTION. Section 2. Purpose. The purpose of [sections 1 through 5] is to provide additional economic opportunities to private industry and to regulate competition by state and local government entities and to ensure that a state or local government entity does not use facilities or equipment purchased or provided with public funds to provide goods to the public when that provision of goods is in competition with private companies that provide similar goods .

NEW SECTION. Section 3. Definitions. As used in [sections 1 through 5], the following definitions apply:

(1) (a) "Government entity" means a department, office, commission, institution, board, or other agency of the state or of a county, consolidated city-county, or municipality and includes school districts .

(b) The term does not include K through 12 public schools, law enforcement services provided under Title 7, chapter 32, fire services provided under Title 7, chapter 33, the state historical society, any local government public health or safety agency, any public facility that provides medical services, or a public library or library district.

(2) "Reviewing authority" means:

(a) the office of the governor, if the government entity being reviewed operates or has authority to operate on a statewide basis;

(b) the board of county commissioners or the governing body of a consolidated city-county, if the government entity being reviewed operates or has authority to operate on a countywide basis;

(c) the governing body of a municipality, if the government entity being reviewed operates or has authority to operate on a citywide or townwide basis; or

(d) the governing body of a school district , if the government entity being reviewed is a school district .

NEW SECTION. Section 4. Government competition with private enterprise prohibited -- exceptions. (1) Except as provided in subsection (3) or unless specifically authorized or required by law, a government entity may not

engage in the processing, sale, offering for sale, rental, leasing, delivery, dispensing, distributing, or advertising of goods to the public that are also offered by private enterprise

.

(2) Except as provided in subsection (3) or unless specifically authorized or required by law, a government entity may not sell goods to another government entity if the goods are offered by private enterprise . This section does not apply to the renting, leasing, or subleasing of real property or personal property by one government entity to another government entity if the property has been rented or leased from private enterprise.

(3) The restrictions on competition with private enterprise contained in this section do not apply to:

(a) printing, distributing, or copying public records or other material relating to a government entity's public business if the costs of the printing, distributing, or copying are recovered through fees or charges; or

(b) goods produced or provided by persons incarcerated by the department of corrections.

NEW SECTION. Section 5. Complaint procedure -- appeal. (1) (a) A person directly affected by a violation of any provision of [sections 1 through 5] by a government entity may file a written complaint with the appropriate reviewing authority and with the head of the government entity, stating the grounds for the complaint.

(b) The government entity named in the complaint shall respond in writing to the reviewing authority and to the complaining party within 45 days of receipt of the complaint. The government entity shall either admit or deny the allegations made in the complaint, and it shall indicate if any remedial action will be taken. If the head of the government entity does not resolve the complaint to the satisfaction of the complainant within 75 days of receipt of the complaint, the complainant may demand a hearing before the reviewing authority.

(c) Within 75 days of the government entity's response to the complaint, the reviewing authority shall issue a report of its findings to the complainant and the government entity.

(d) At any time within 2 years after receipt of the reviewing authority's report, the complainant may bring an action in the district court for Lewis and Clark County or in the district court in the county where the complainant's business is located, for a violation of a provision of [sections 1 through 5] . In addition to any other remedy, including a temporary or permanent injunction, the district court may award reasonable attorney fees and costs to the prevailing party.

(2) (a) Each reviewing authority that has received a complaint during the previous year shall transmit an annual report of its activities, pursuant to the provisions of [sections 1 through 5], in January of each year to the legislative audit committee.

(b) The report must include, at a minimum, copies of all complaints received, responses of government entities, evidence received and findings made by the reviewing authority, reports issued by the reviewing authority, and records, if any, of the final disposition of all complaints.

NEW SECTION. Section 6. Study of government competition with private sector. The legislative council shall designate an appropriate legislative interim committee to study the issue of government competition by political subdivisions of this state with the private sector. The study must include an examination of the impact on the private sector of the provision of services, manufacturing, construction, and maintenance and repair by governmental entities in this state and an examination of the feasibility and desirability of privatizing specific services, manufacturing, construction, and maintenance and repair activities conducted by political subdivisions. The appropriate committee shall prepare for submission to the 57th legislature a report of its findings and any recommendations or proposed legislation.

NEW SECTION. Section 7. Codification instruction. [Sections 1 through 5] are intended to be codified as an integral part of Title 2, chapter 8, and the provisions of Title 2, chapter 8, apply to [sections 1 through 5].

NEW SECTION. Section 8. Severability. If a part of [this act] is invalid, all valid parts that are severable from the invalid part remain in effect. If a part of [this act] is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications.

NEW SECTION. Section 9. Saving clause. [This act] does not affect rights and duties that matured, penalties that were incurred, or proceedings that were begun before [the effective date of this act].

NEW SECTION. Section 10. Effective date. [This act] is effective on passage and approval.

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