SB 383: State Procurement Office; Public Procurement; Small Purchase Procurements; Minimum Threshold; Report

A BILL FOR AN ACT

RELATING TO SMALL PURCHASES.

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

     SECTION 1.  The legislature finds that escalating costs of goods over the years, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  The legislature further finds that the frequency of earthquakes on Hawaii island, an indicator of a future potentially devastating volcanic eruption that could impact residential and commercial areas, as well as the devastation from the tragic 2023 Maui wildfires, emphasize the inescapable need to address issues with small purchase procurements to facilitate more efficient disaster recovery efforts.

     Accordingly, the purpose of this Act is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements that are subject to an electronic system, from $25,000 to $50,000; and

     (2)  Require the state procurement office to submit a report to the legislature on the efficacy of the increased minimum small purchase procurement amounts.

     SECTION 2.  Section 103D-305, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  Procurements of [$25,000] $50,000 to less than $250,000 shall be made in accordance with small purchase procedures; provided that [such] these small purchase procurements shall be conducted through an electronic system [shall be required]."

     SECTION 3.  No later than twenty days prior to the convening of the regular session of 2026, the state procurement office shall submit to the legislature a report of its findings and recommendations, including any proposed legislation, on the efficacy of the amendment to section 103D-305, Hawaii Revised Statutes, made by section 2 of this Act.

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect upon its approval.

Report Title:

State Procurement Office; Public Procurement; Small Purchase Procurements; Minimum Threshold; Report

Description:

Increases the minimum amount for purchases constituting small purchase procurements that are subject to an electronic system, from $25,000 to $50,000.  Requires a report to the Legislature.  (CD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO SMALL PURCHASES.

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

     SECTION 1.  The legislature finds that escalating costs of goods over the years, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  The legislature further finds that the frequency of earthquakes on Hawaii island, an indicator of a future potentially devastating volcanic eruption that could impact residential and commercial areas, as well as the devastation from the tragic 2023 Maui wildfires, emphasize the inescapable need to address issues with small purchase procurements to facilitate more efficient disaster recovery efforts.

     Accordingly, the purpose of this Act is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements not subject to an electronic system from $25,000 to $50,000; and

     (2)  Require the state procurement office to submit a report to the legislature on the efficacy of the increased minimum small purchase procurement amounts.

     SECTION 2.  Section 103D-305, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  Procurements of [$25,000] $50,000 to less than $250,000 shall be made in accordance with small purchase procedures; provided that [such] these small purchase procurements shall be conducted through an electronic system [shall be required]."

     SECTION 3.  No later than twenty days prior to the convening of the regular session of 2026, the state procurement office shall submit to the legislature a report of its findings and recommendations, including any proposed legislation, on the efficacy of the amendment to section 103D-305, Hawaii Revised Statutes, made by section 2 of this Act.

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect on July 1, 3000.

Report Title:

State Procurement Office; Public Procurement; Small Purchase Procurements; Threshold; Report

Description:

Increases the minimum amount for purchases constituting small purchase procurements not subject to an electronic system from $25,000 to $50,000.  Requires a report to the Legislature.  Effective 7/1/3000.  (HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO SMALL PURCHASES.

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

     SECTION 1.  The legislature finds that escalating costs of goods over the years, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  The legislature further finds that the frequency of earthquakes on Hawaii island, an indicator of a future potentially devastating volcanic eruption that could impact residential and commercial areas, as well as the devastation from the tragic 2023 Maui wildfires, emphasize the inescapable need to address issues with small purchase procurements to facilitate more efficient disaster recovery efforts.

     Accordingly, the purpose of this Act is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements not subject to an electronic system from $25,000 to $50,000; and

     (2)  Require the state procurement office to submit a report to the legislature on the efficacy of the increased minimum small purchase procurement amounts.

     SECTION 2.  Section 103D-305, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  Procurements of [$25,000] $50,000 to less than $250,000 shall be made in accordance with small purchase procedures; provided that [such] these small purchase procurements shall be conducted through an electronic system [shall be required]."

     SECTION 3.  No later than twenty days prior to the convening of the regular session of 2026, the state procurement office shall submit to the legislature a report of its findings and recommendations, including any proposed legislation, on the efficacy of the amendment to section 103D-305, Hawaii Revised Statutes, made by section 2 of this Act.

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect upon its approval.

Report Title:

State Procurement Office; Public Procurement; Small Purchase Procurements; Threshold; Report

Description:

Increases the minimum amount for purchases constituting small purchase procurements not subject to an electronic system from $25,000 to $50,000.  Requires a report to the Legislature.  (SD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO SMALL PURCHASES.

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

     SECTION 1.  The legislature finds that escalating costs of goods over the years, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  The growing frequency of earthquakes on Hawaii island, an indicator of potential devastating volcanic eruption effects on residential and commercial areas, and the resulting devastation from the tragic 2023 Maui wildfires emphasizes the inescapable need to address issues with small purchase procurements to facilitate more efficient disaster recovery efforts.

     Accordingly, the purpose of this Act is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements from $25,000 to $50,000; and

     (2)  Require the state procurement office to submit a report to the legislature on the efficacy of the increased procurement amounts.

     SECTION 2.  Section 103D-305, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  Procurements of [$25,000] $50,000 to less than $250,000 shall be made in accordance with small purchase procedures; provided that [such] small purchase procurements through an electronic system shall be required."

     SECTION 3.  The state procurement office shall submit a report of its findings and recommendations on the efficacy of the amendment to section 103D-305, Hawaii Revised Statutes, made by section 2 of this Act, and any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2026.

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect January 1, 2525.

Report Title:

State Procurement Office; Public Procurement; Small Purchase Procurements; Threshold; Report

Description:

Increases the minimum amount for purchases constituting small purchase procurements from $25,000 to $50,000.  Requires a report to the Legislature.  Effective 1/1/2525.  (SD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO SMALL PURCHASES.

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

     SECTION 1.  The legislature finds that escalating costs of goods over the years, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  The growing frequency of earthquakes on Hawaii island, an indicator of potential devastating volcanic eruption effects on residential and commercial areas, and the resulting devastation from the tragic 2023 Maui wildfires emphasizes the inescapable need to address issues with small purchase procurements to facilitate more efficient disaster recovery efforts.

     Accordingly, the purpose of this Act is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements from $25,000 to $50,000; and

     (2)  Require the state procurement office to submit a report to the legislature on the efficacy of the increased procurement amounts.

     SECTION 2.  Section 103D-305, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  Procurements of [$25,000] $50,000 to less than $250,000 shall be made in accordance with small purchase procedures; provided that [such] small purchase procurements through an electronic system shall be required."

     SECTION 3.  The state procurement office shall submit a report of its findings and recommendations on the efficacy of the amendment to section 103D-305, Hawaii Revised Statutes, made by section 2 of this Act, and any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2026.

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect upon its approval.

Report Title:

SPO; Small Purchase Procurements; Report

Description:

Increases the minimum amount for purchases constituting small purchase procurements from $25,000 to $50,000.  Requires a report to the Legislature.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

CONFERENCE COMMITTEE REP. NO. 134

Honolulu, Hawaii

                 , 2025

RE:    S.B. No. 383

       S.D. 2

       H.D. 1

       C.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir and Madam:

     Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 383, S.D. 2, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO SMALL PURCHASES,"

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

     The purpose of this measure is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements that are subject to an electronic system from $25,000 to $50,000; and

     (2)  Require a report to the Legislature.

     Your Committee on Conference finds that the costs of goods have increased significantly since the threshold for small purchase procurements that are subject to an electronic system was originally set.  Due to inflation and higher costs, more small purchases than the Legislature originally intended are now required to adhere to the electronic procurement system.  Your Committee on Conference further finds that the requirements of the electronic system may be arduous and overly time-consuming during disaster recovery efforts, which are increasingly common and often require expedient small purchase procurements.  Therefore, this measure raises the minimum threshold for small purchase procurements that are subject to an electronic system to align with increased costs and facilitate more efficient disaster recovery efforts.

     Your Committee on Conference has amended this measure by:

     (1)  Making it effective upon its approval; and

     (2)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 383, S.D. 2, H.D. 1, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 383, S.D. 2, H.D. 1, C.D. 1.

Respectfully submitted on behalf of the managers:

STAND. COM. REP. NO.  1944

Honolulu, Hawaii

                , 2025

RE:   S.B. No. 383

      S.D. 2

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Finance, to which was referred S.B. No. 383, S.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO SMALL PURCHASES,"

begs leave to report as follows:

     The purpose of this measure is to:

     (1)  Increase the minimum amount for purchases constituting small purchase procurements not subject to an electronic system from $25,000 to $50,000; and

     (2)  Require the State Procurement Office to submit a report to the Legislature on the efficacy of the increased minimum small purchase procurement amounts.

     Your Committee received testimony in support of this measure from the Department of Transportation and Office of the Mayor of the City and County of Honolulu.  Your Committee received testimony in opposition to this measure from the State Procurement Office.

     Your Committee finds that escalating costs of goods over the years, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  Your Committee believes that increasing the minimum threshold for small purchases provides better flexibility for procurement management and ensures that goods and services can be obtained quickly and efficiently.

     Your Committee has amended this measure by changing the effective date to July 1, 3000, to encourage further discussion.

     As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 383, S.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 383, S.D. 2, H.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Finance,

STAND. COM. REP. NO. 728

Honolulu, Hawaii

RE:    S.B. No. 383

       S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred S.B. No. 383, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO SMALL PURCHASES,"

begs leave to report as follows:

     The purpose and intent of this measure is to increase the expediency and efficiency of small purchase procurements.

     Specifically, this measure increases from $25,000 to $50,000 the procurement threshold for small purchases not subject to the State's electronic procurement system.

     Your Committee received written comments in support of this measure from the Hawaii State Public Library System and City and County of Honolulu.

     Your Committee received written comments in opposition to this measure from the State Procurement Office.

     Your Committee received written comments on this measure from the Honolulu Police Department.

     Your Committee finds that the cost of supplies, equipment, construction materials, and services have risen rapidly since the current threshold amount was established.  Accordingly, your Committee finds that the present threshold amount should be increased by a reasonable amount to address these increased costs.

     Your Committee has amended this measure by:

     (1)  Changing the effective date to upon its approval; and

     (2)  Making technical nonsubstantive amendments for purposes of clarity, consistency, and style.

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 383, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 383, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

STAND. COM. REP. NO. 187

Honolulu, Hawaii

RE:    S.B. No. 383

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committee on Government Operations, to which was referred S.B. No. 383 entitled:

"A BILL FOR AN ACT RELATING TO SMALL PURCHASES,"

begs leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Increase the small purchase dollar threshold for public procurement from $25,000 to $50,000; and

     (2)  Require the State Procurement Office to submit a report to the Legislature on the effectiveness of the raised thresholds.

     Your Committee received testimony in support of this measure from the Department of Transportation, Hawaiʻi State Public Library System, and Office of the Mayor of the County of Maui.

     Your Committee received testimony in opposition to this measure from the State Procurement Office.

     Your Committee finds that the escalating costs of goods over time, particularly during the COVID-19 pandemic, have created numerous difficulties regarding small purchase procurement.  The increasing frequency of natural disasters in the State further emphasizes the need to increase the procurement threshold for small purchases, which will facilitate more efficient disaster recovery efforts.  Your Committee further finds that the current small purchase procurement threshold hinders the volume and diversity of the buying activities of state agencies.  This measure will facilitate disaster recovery and the repair and maintenance of state facilities by increasing the small purchase dollar threshold.

     Your Committee has amended this measure by:

     (1)  Inserting an effective date of January 1, 2525, to encourage further discussion; and

     (2)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     Your Committee notes the concerns expressed by the State Procurement Office that raising the threshold for manual procurement processes while leaving existing limits on electronic procurements intact may have unintended consequences on the utilization of these procurement methods.  Your Committee finds that this concern merits further consideration and respectfully requests subsequent Committees to which this measure is referred to examine this issue.

     As affirmed by the record of votes of the members of your Committee on Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 383, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 383, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Government Operations,