This chapter shall be known and may be cited as 'The Small Business Assistance Act of 1975.'

This chapter shall be liberally construed to carry out its purposes and objectives of assisting small businesses to successfully enter and remain in the economic mainstream and to otherwise achieve the statement of legislative policy contained herein.

The legislative intent of this chapter is declared to be as follows: The most important element of the American economic system of private enterprise is free and vigorous competition. Only through the existence of free and vigorous competition can free entry into business and opportunities for personal initiative and individual achievement be assured. The preservation and expansion of such competition is essential for our economic well-being. In order to insure such competition, small business concerns must be encouraged and developed, and it is the declared policy of the state to aid, counsel and assist, in every practical manner, the interests of small business concerns in order to preserve free competitive enterprise and to insure that a fair proportion of the total purchases and contracts or subcontracts for property, commodities and services for the state be placed with small businesses.

For the purposes of this chapter, the following terms shall have the following meanings, respectively, unless the context clearly indicates a different meaning:

(1) SMALL BUSINESS. A business which is independently owned and operated. In addition, such business must have either fewer than 50 employees or less than $1,000,000.00 in gross receipts per year.

(2) DIVISION. The Division of Purchases and Stores of the Department of Finance.

(3) DEPARTMENT. The Department of Industrial Relations.

The department is authorized and empowered to:

(1) Provide technical and managerial assistance to small business concerns, by advising and counseling on matters in connection with state procurement policies, practices of good management, including, but not limited to, cost accounting, methods of financing, business insurance, accident control, wage incentives, methods engineering and legal questions, by cooperating and advising with voluntary business, professional, educational and other organizations, associations and institutions and with federal and state agencies, by maintaining a clearinghouse for information concerning the managing, financing and operation of small business enterprises, by disseminating such information and by such other activities as are deemed appropriate;

(2) Make a complete inventory of all productive facilities of small business concerns in the state;

(3) Coordinate and ascertain the means by which the productive capacity of small business concerns can be most effectively utilized;

(4) Obtain information as to the methods and practices of prime contractors in letting subcontracts and take action to encourage the letting of subcontracts by prime contractors to small business concerns at prices and on conditions and terms which are fair and equitable;

(5) Determine the concerns, firms, persons, corporations, partnerships, cooperatives or other business enterprises which are to be designated small business concerns for the purposes of effectuating the provisions of this chapter; and to carry out the purposes of this chapter, the office shall designate individual concerns as small business concerns in accordance with the provisions of this chapter. Any such designation shall be subject to revocation when the concern covered thereby ceases to be a small business;

(6) Obtain from any state department or agency engaged in procurement or in the financing of procurement such reports and information concerning the letting of contracts and subcontracts, purchases or procurement of articles, commodities, materials, supplies or services as it may deem pertinent in carrying out its functions under this chapter;

(7) Make studies, conduct workshops and seminars and make recommendations to state agencies or the Legislature to insure that a fair proportion of the total purchases and contracts for articles, commodities, supplies and services for the state is placed with small business enterprises;

(8) Promote the mobilization of activities and resources of state and local governments, businesses and trade associations, universities, foundations, professional organizations and volunteer and other groups toward the growth of small business enterprises and facilitate the coordination of the efforts of these groups with those of federal departments and agencies; and

(9) Promulgate such rules and regulations as are necessary to administer and effectuate the purposes of this chapter.

In the administration of this chapter, the department shall have the power to conduct public hearings for the purposes of determining the law's effectiveness, determining methods and standards of administration and to otherwise assist in carrying out the purposes of this chapter.

The department shall have the authority to administer oaths and affirmations, take depositions, issue subpoenas and compel the attendance of witnesses and production of books, papers, correspondence, memoranda and other records deemed necessary as evidence.

There is hereby created an advisory council to the department to be composed of representatives of designated small business enterprises to be named as follows: five by the Governor, two each by the President of the Senate and the Speaker of the House of Representatives and one by the director of the department to serve ex officio as chairman of the council. The members of the council shall serve without compensation but may be reimbursed for travel and other necessary expenses out of any funds appropriated to the department. The council shall meet at least quarterly or more often when necessary at the call of the chairman in consultation with the director of the department, who shall also serve without additional compensation as executive director of the council.

The department shall make a written report to the Governor, the President of the Senate, the Speaker of the House of Representatives and the chairman of the Senate and House commerce committees at least once each year, such report to be made no later than December 1. The report shall advise the Governor, the speaker, the president and the designated chairmen concerning the administration and operation of this chapter and shall contain such recommendations for amendment of this chapter as the department and the advisory council provided for in Section 25-10-6 deem proper.

In the administration of this chapter, the department shall cooperate to the fullest extent consistent with the provisions of this chapter with those agencies of the United States government whose programs are complimentary to the objectives and purposes hereof, and shall take such action, through the adoption of administrative rules, regulations, and standards, as may be necessary to secure to this state and its citizens all advantages available under such federal programs and to otherwise assist the citizens of this state in realizing their full economic potential. Each department or other agency of the state shall cooperate with the department in carrying out the purposes of this chapter and shall, when so requested by the department, submit such reports and information as may be necessary or helpful.

Notwithstanding the provisions of the state bid law or other conflicting statutes of this state, it is herewith provided:

(1) It shall be the policy of the state that, whenever practical, a meaningful percentage of each department's or agency's total purchases of articles, equipment, commodities, supplies, materials, services or contracts be procured or otherwise awarded to small businesses.

(2) This meaningful percentage shall not be less than 10 percent of the annual value of any department's or agency's total purchases of articles, materials, commodities, supplies, services or contracts unless that department or agency files with the division a statement explaining the reasons why that agency cannot meet the requirements of this policy. If the division is satisfied that the department's or agency's reasons for its inability to comply with the requirements of this chapter are supported by substantial evidence, it may issue a waiver for that department or agency to the extent it cannot comply. However, such waiver shall be granted for a period not to exceed one year; provided, however, that such waiver may be renewed upon application by the department or agency, review and approval by the division.

(3) The only reasons that shall justify a department or agency being granted a waiver from the provisions of this section are:

a. Impossibility or unreasonable difficulty in procuring such articles, commodities, supplies, materials, services or contracts from small business enterprises;

b. Inability to procure such articles, supplies, materials, services or contracts from such small business enterprises at the lowest bid; or

c. Substantial differences in the quality of such articles, supplies, materials, services or contracts available from small business enterprises as compared to the quality of such items if procured otherwise.