Hawaii

Key Agency(ies): The Hawaii State Procurement Office (SPO) is the central Executive procurement agency and is led by the Administrator of the SPO. The SPO Administrator serves as the Chief Procurement Officer for Hawaii’s Executive agencies. Individual agencies also have department procurement officers for conducting their own procurements.

Hawaii also utilizes a five-member Procurement Policy Board, which is responsible for enacting procurement regulations under the Hawaii Public Procurement Code.

More information about the Hawaii State Procurement Office can be accessed at: https://spo.hawaii.gov/.

Key Statute: Hawaii’s procurement law is codified in Chapter 103D of the Hawaii Revised Statutes (Haw. Rev. Stat.), entitled “Hawaii Public Procurement Code.”

Hawaii also has a separate procurement code specifically for health and social services codified in Chapter 103F of the Hawaii Revised Statutes, entitled “Purchases of Health and Human Services.”

Chapters 103D and 103F can be accessed at: https://spo.hawaii.gov/references/hrs/

Key Regulations: The Procurement Policy Board issues regulations codified in the Code of Hawaii Rules (Haw. Code R.), Title 3, Subtitle 11, Chapters 3-120 through 3-132 to administer Chapter 103D.

The relevant Code of Hawaii Rules can be accessed at: https://spo.hawaii.gov/procurement-wizard/har-3-120-general-provisions/

Procurement Types/Highlights: The most common methods of procurement in Hawaii are:

Competitive Sealed Bidding (Invitation for Bids): This is the default method of contracting. Under this method, contracts are awarded to the lowest-priced responsive and responsible bidder. An IFB requires publicly advertising the solicitation, a public bid opening, and an evaluation for bidder responsiveness and responsibility.

Competitive Sealed Proposals (Request for Proposals): This method is used when competitive sealed bidding is not practicable. An RFP permits the state to engage in negotiations and a best value evaluation. The contract is awarded to the proposal determined to be the most advantageous to the state, considering price and other evaluation factors.

Small Purchases: Hawaii provides for simplified acquisition procedures for procurements under $100,000 for goods and services and $250,000 for construction. Agencies must still obtain adequate competition, and must document the purchase.

Bid Protests:

Regs Governing Bid Protests:

• Hawaii’s bid protest procedures are governed by Haw. Rev. Stat. § 103D-701 through 103D-710 and Haw. Code R. § 3-126.
• Protests must be submitted in writing to the purchasing agency’s Chief Procurement Officer (CPO) or to a designated protest official as named in the solicitation.

Timeliness Rules:

• Protests must be filed within five business days after the protester knew or should have known about their basis for protest.
• If the solicitation provides for a debriefing, protests must be submitted within five business days of the debriefing.
• Protests regarding the terms of a solicitation must be filed before the offer due date.

Protest Process:

• If a protest is timely filed, the procurement is automatically stayed unless the agency CPO makes a written determination that awarding the contract without delay is necessary to protect a substantial state interest.
• Protests are initially handled within the agency. The CPO must review protest allegations and issue a written decision upholding or denying the protest “as expeditiously as possible.”

Appeals:

• If the CPO denies the appeal, a protester may pursue an administrative appeal by the Office of Administrative Hearings (OAH) within the Department of Commerce and Consumer Affairs. The OAH will conduct a de novo hearing of the protest.
• Protesters must file for an administrative appeal within seven calendar days after the agency’s initial protest decision. Decisions must be issued by OAH within 45 days of the filing of the appeal.

Claims:

• Hawaii’s contract claims procedures are governed by Haw. Rev. Stat. § 103D-703 and Haw. Code R. § 3-126.
• Hawaii encourages negotiation of claims without litigation. A contractor must submit a written claim to the agency CPO stating the relief requested and the contractual basis. The CPO or their designee may settle and resolve the claim prior to litigation.
• If no agreement can be reached, the CPO must issue a written decision on the claim within 90 days after the contractor requests a final decision.

Appeals:

• Hawaii does not provide for further administrative review of contract claims; following an adverse agency decision, contractors must proceed to state court to pursue their claims.

Suspension & Debarment:

• Hawaii’s procedures regarding suspension and debarment are governed by Haw. Rev. Stat. § 103D-702 and Haw. Code R. § 3-126.
• Each agency CPO has the power to suspend or debar a contractor. A CPO must give contractors notice and an opportunity to be heard before proceeding with a suspension or a debarment. Hawaii law provides that debarment and suspension are to be imposed only in the public interest to protect the government and not for the purposes of punishment.
• Grounds for debarment in Hawaii include: conviction of a criminal offense incident to obtaining or performing a public or private contract, serious contract violations that show a contractor to be unreliable, and violation of ethical standards set out in Hawaii law.
• The maximum period for debarment in Hawaii is three years.
• Suspensions in Hawaii may last for no more than three months.

Interesting/Distinctions: Haw. Rev. Stat. Chapter 103B requires that for most state construction contracts, the contractor must employ Hawaii residents for at least 80% of the project’s workforce.