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*hb0261*
HOUSE BILL 261
P2 (6lr0298)
ENROLLED BILL
— Government, Labor, and Elections/Budget and Taxation —
Introduced by Chair, Government, Labor, and Elections Committee (By Request –
Departmental – General Services)
Read and Examined by Proofreaders:
_______________________________________________
Proofreader.
_______________________________________________
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his approval this
_______ day of _______________ at ________________________ o’clock, ________M.
______________________________________________
Speaker.
CHAPTER ______
AN ACT concerning 1
State Procurement – Competitive Proof of Concept Procurement 2
FOR the purpose of establishing competitive proof of concept procurements as an 3
authorized procurement method; providing that a competitive proof of concept 4
procurement may have multiple phases of evaluation; requiring a unit of Stat e 5
government to obtain the approval of the Chief Procurement Officer or a designee 6
before conducting a certain competitive proof of concept procurement; requiring a 7
unit of State government to obtain the approval of the Secretary of Information 8
Technology or a designee before conducting a certain competitive proof of concept 9
procurement for information technology; repealing a provision that authorizes a 10
competitive proof of concept procurement to be conducted through certain 11
procurement methods; altering th e required contents of a competitive proof of 12
concept solicitation; requiring competitive proof of concept solicitations to be posted 13
on eMaryland Marketplace Advantage; altering procedures for conducting a 14
2 HOUSE BILL 261
competitive proof of concept procurement; authori zing a unit to enter into certain 1
contracts with certain offerors under certain circumstances; requiring a unit to 2
publish notice of a certain award in eMaryland Marketplace Advantage; requiring 3
the Department of General Services to adopt certain regulatio ns; providing for the 4
establishment of certain percentage goals for minority business enterprise 5
participation and veteran –owned small business enterprise participation; 6
authorizing the Governor’s Office of Small, Minority, and Women Business Affairs 7
to exempt competitive proof of concept procurements from the small business reserve 8
designation under certain circumstances; and generally relating to competitive proof 9
of concept procurements. 10
BY repealing and reenacting, with amendments, 11
Article – State Finance and Procurement 12
Section 13–102(a), 13–116, 14–302(a)(2), 14–502.1(b), and 14–602(b) 13
Annotated Code of Maryland 14
(2021 Replacement Volume and 2025 Supplement) 15
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
That the Laws of Maryland read as follows: 17
Article – State Finance and Procurement 18
13–102. 19
(a) The following procurement methods are authorized at the procurement 20
officer’s discretion, where applicable: 21
(1) competitive sealed bids under § 13–103 of this subtitle; 22
(2) competitive sealed proposals under § 13 –104 or § 13 –105 of this 23
subtitle; 24
(3) noncompetitive negotiation under § 13–106 of this subtitle; 25
(4) sole source procurement under § 13–107 of this subtitle; 26
(5) emergency or expedited procurement under § 13–108 of this subtitle; 27
(6) small procurement under § 13–109 of this subtitle; 28
(7) an intergovernmental cooperative purchasing agreement under § 29
13–110 of this subtitle; 30
(8) auction bids under § 13–111 of this subtitle; 31
(9) architectural, engi neering, and land surveying services qualification 32
based selection under § 13–112 of this subtitle; 33
HOUSE BILL 261 3
(10) master contracting under § 13–113 of this subtitle; [or] 1
(11) legislative fast–track procurements under § 13–117 of this subtitle; OR 2
(12) COMPETITIVE PROOF OF CONCEPT PROCUREMENTS UNDER § 3
13–116 OF THIS SUBTITLE. 4
13–116. 5
(a) In this section, “proof of concept” means a test, evaluation, demonstration, or 6
pilot project of a good, service, or technology in a real –world environment to evaluate 7
whether the good, service, or technology can be successfully deployed and is beneficial to 8
the State. 9
(b) (1) A competitive proof of concept procurement is a formal competitive 10
procurement method that may be used to solicit proposals for the con duct of a proof of 11
concept [prior to ] AND PARTICIPATION IN SUBSEQUENT PHASES OF THE 12
PROCUREMENT, INCLUDING full implementation OR DEPLOYMENT when the head of a 13
unit determines the process to be appropriate and in the best interests of the unit, 14
including: 15
(i) testing software–as–a–service or off–the–shelf software; 16
(ii) testing new, innovative products or services; or 17
(iii) testing a product or service conceptualized or conceived of by a 18
unit of State government. 19
(2) (i) 1. After obtaining th e approval of the head of the unit and 20
before conducting a competitive proof of concept procurement, the unit shall obtain 21
approval from [the Secretary of Information Technology, or the Secretary’s designee] THE 22
CHIEF PROCUREMENT OFFICER, OR THE CHIEF PROCUREMENT OFFICER’S 23
DESIGNEE. 24
2. THE REQUEST FOR APPRO VAL UNDER THIS 25
SUBPARAGRAPH SHALL DEMONSTRATE THAT CONDUCTING A COMPETITIVE PROOF 26
OF CONCEPT PROCUREMENT IS IN THE BEST INTEREST OF THE STATE. 27
(II) IF THE PROCUREMENT IS FOR INFORMATION TECHNOLOGY, 28
BEFORE CONDUCTING A COMPETITIVE PROOF OF CONCEPT PROCUREMENT, THE 29
UNIT SHALL OBTAIN AP PROVAL FROM THE SECRETARY OF INFORMATION 30
TECHNOLOGY, OR THE SECRETARY’S DESIGNEE. 31
4 HOUSE BILL 261
[(ii)] (III) The Secretary of Information Technology may grant 1
approval for a com petitive proof of concept procurement FOR INFORMATION 2
TECHNOLOGY if the unit: 3
1. has sufficient internal resources to manage the proof of 4
concept, including human capital, subject matter expertise, and technological 5
infrastructure, or has the means to obtain these resources; and 6
2. enters into a memorandum of understanding with the 7
Department of Information Technology that requires regular status updates, vendor 8
capacity, and any other information necessary for the Department of Information 9
Technology to evaluate whether the proof of concept can be successfully deployed and is 10
beneficial to the State. 11
(c) (1) [A competitive proof of concept procurement may be conducted through 12
the issuance of a solicitation by any method of procurement authorized under this Division 13
II. 14
(2)] A competitive proof of concept procurement solicitation shall include a 15
statement of: 16
(i) the scope of work, STATEMENT OF NEED, or project description, 17
including the intended use, quantity, estimated time frame for the proof of concept, and 18
anticipated number of proof of concept awards that will be made; and 19
(ii) the factors, including price, that will be used AT EACH PHASE in 20
evaluating proposals and the relative importance of each. 21
[(3)] (2) A solicitation may be distributed to vendors known to offer goods 22
or services within the scope of the proof of concept and shall [, except for procurements 23
under $15,000 not otherwise required by law to be posted, ] be posted on eMaryland 24
Marketplace Advantage[, in accordance with the policies and procedures under subsection 25
(g) of this section]. 26
(d) After receipt of proposals but before award of a procurement contract, a unit 27
may: 28
(1) conduct discussions with AND RECEIVE CLARIFIC ATIONS FROM an 29
offeror [to ensure full understanding of: 30
(i) the requirements of the unit, as set forth in the request for 31
proposals; and 32
(ii) the proposal submitted by the offeror; and]; 33
HOUSE BILL 261 5
(2) request product samples for testing by the unit or a demonstration of a 1
product or service and use these samples or demonstrations in its evaluation process; AND 2
(3) ALLOW OFFERORS REASO NABLY SUSCEPTIBLE OF BEING 3
SELECTED FOR AWARD T O PARTICIPATE IN ALL SUBSEQUENT PHASES OF THE 4
PROCUREMENT INCLUDING SUBMISSION OF BEST AND FINAL OFFERS. 5
(e) (1) A [request for] UNIT MAY ISSUE A CON TRACT TO EACH OFFERO R 6
REASONABLY SUSCEPTIBLE OF BEING SELECTED FOR AWARD TO DELIVER product 7
samples for testing or PROVIDE A demonstration made under subsection (d)(2) of this 8
section [shall be issued to all offerors deemed reasonable at the time of the request]. 9
(2) A CONTRACT AWARDED UND ER THIS SUBSECTION D OES NOT 10
PRECLUDE A VENDOR FROM CONTINUING TO PARTICIPATE IN SUBSEQUENT PHASES 11
OF THE PROCUREMENT. 12
(f) [A unit may award one or more of the proposals a contrac t for the proof of 13
concept. 14
(g) A vendor awarded a proof of concept procurement shall be eligible to bid on a 15
procurement to implement a proposal related to the proof of concept procurement] A UNIT 16
MAY AWARD ONE OR MOR E CONTRACTS FOR FULL IMPLEMENTATION OR 17
DEPLOYMENT OF THE GO OD, SERVICE, OR TECHNOLOGY EVALUATED DURING THE 18
PROOF OF CONCEPT IF IT IS IN THE BEST INTEREST OF THE STATE. 19
(G) A UNIT SHALL PUBLISH NOTICE OF A CONTRACT AWARDED UNDER THIS 20
SECTION IN EXCESS OF THE SMALL PROCUREMENT AMOUNT SPECIFIED IN § 13–109 21
OF THIS SUBTITLE IN EMARYLAND MARKETPLACE ADVANTAGE. 22
(h) The Department of General Services, in consultation with the Department of 23
Information Technology, shall adopt REGULATIONS, policies, and procedures for the 24
development and implementation of competitive proof of concept procurements. 25
14–302. 26
(a) (2) (I) The Special Secretary for the Office of Small, Minority, and 27
Women Business Affairs, in consultation with the Secretary of Transport ation, the Chief 28
Procurement Officer, and the Attorney General, shall establish guidelines for each unit to 29
consider when determining the appropriate minority business enterprise participation 30
percentage goal for a procurement contract in accordance with p aragraph (3) of this 31
subsection. 32
(II) FOR A COMPETITIVE PRO OF OF CONCEPT PROCUR EMENT 33
CONDUCTED UNDER § 13–116 OF THIS ARTICLE , THE MINORITY BUSINES S 34
6 HOUSE BILL 261
ENTERPRISE PARTICIPATION PERCENTAGE GOAL, IF ANY, SHALL BE ESTABLISHED 1
AT A PHASE SPECIFIED IN THE SOLICITATION DOCUMENTS. 2
14–502.1. 3
(b) (1) [A] EXCEPT AS PROVIDED IN PARAGRAPH (3) OF THIS 4
SUBSECTION, A procurement with a total dollar value of $1,000,000 or less shall be 5
designated for the small business reserve. 6
(2) Each unit or agency shall implement this subsection in a manner 7
consistent with all applicable statutes, including the requirements of Subtitle 3 of this title. 8
(3) A COMPETITIVE PROOF OF CONCEPT PROCUREMENT CONDUCTED 9
UNDER § 13–116 OF THIS ARTICLE MAY BE EXEMPT FROM DESIG NATION UNDER 10
PARAGRAPH (1) OF THIS SUBSECTION I F THE GOVERNOR’S OFFICE OF SMALL, 11
MINORITY, AND WOMEN BUSINESS AFFAIRS DETERMINES TH AT IT IS NOT 12
PRACTICABLE TO DESIG NATE THE PROCUREMENT FOR THE SMALL BUSINE SS 13
RESERVE. 14
14–602. 15
(b) (1) [Solicitation] EXCEPT AS P ROVIDED IN PARAGRAPH (2) OF THIS 16
SUBSECTION, SOLICITATION documents shall state the expected percentage of 17
veteran–owned small business enterprise participation based, in part, on: 18
[(1)] (I) the potential contracting opportunities available in the 19
procurement contract, including both prime contracting and subcontracting opportunities, 20
as determined through analysis of the scope of the work presented in the solicitation 21
documents; and 22
[(2)] (II) the availability of veteran –owned small business ent erprises to 23
respond competitively to the potential contracting opportunities. 24
(2) FOR A COMPETITIVE PRO OF OF CONCEPT PROCUR EMENT 25
CONDUCTED UNDER § 13–116 OF THIS ARTICLE , THE EXPECTED PERCENT AGE OF 26
VETERAN–OWNED SMALL BUSINESS ENTERPRISE PARTICIPATION, IF ANY, SHALL BE 27
ESTABLISHED AT A PHASE SPECIFIED IN THE SOLICITATION DOCUMENTS. 28
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 29
1, 2026. 30