Request By:
Karen Powell, General Counsel of the Finance Cabinet
Opinion
Opinion By: Albert B. Chandler III, Attorney General; Ross T. Carter, Manager of the Opinions Branch
Opinion of the Attorney General
In 1996, the General Assembly enacted KRS 56.770 to .784, a set of laws intended to reduce the consumption of energy in state buildings. The law allows state agencies to install energy-conserving equipment without an appropriation to pay for it if the equipment cost can be recouped through savings on energy consumption.
The Finance Cabinet, which is responsible for implementing this law, asks three questions. The first is whether purchases must comply with KRS chapter 45A, the Kentucky Model Procurement Code.
Two observations support a conclusion that KRS 56.770 to .784 supplement, rather than supplant, the Kentucky Model Procurement Code. First, the Kentucky Model Procurement Code contains this provision at KRS 45A.020:
(1) This code shall apply to every expenditure of public funds by this Commonwealth under any contract or like business arrangement . . . .
(2) Since this code is a general act intended to provide model coverage of its subject matter, no part of it shall be deemed to be impliedly repealed by subsequent legislation if such construction of the subsequent legislation can be reasonably avoided.
Nothing in KRS 56.770 to .784 expressly indicates whether those statutes work in conjunction with the Kentucky Model Procurement Code, or as an alternative to it. The focus of the act is on the financing, not the procurement, of energy saving contracts. Because KRS 45A.020 prohibits restriction of the Kentucky Model Procurement Code by implication, the code must be presumed to apply to energy saving contracts.
Second, the preamble of a legislative act, while not an essential part of the legislation, may be resorted to as an aid in construing the act. Reeves v Adams Hat Stores, 303 Ky 633, 198 SW 2d 789 (1947). The preamble to the legislation in question includes this language:
WHEREAS, KRS 45A.045(11) promotes acquisition of energy efficient products . . . .
Here is a direct reference to the Kentucky Model Procurement Code. It provides some indication of legislative intent that the Kentucky Model Procurement Code continue to govern procurements.
We therefore conclude that the Kentucky Model Procurement Code applies to procurements of energy saving contracts.
The second question is whether one contract may include both design and construction of an energy-saving installation.
In OAG 92-143 we said that use of the design/build method of construction by local governments does not violate KRS 424.260, the statute governing most procurements by local governments. In order that "competing potential bidders can know with particularity the product for which a bid might be tendered," we said that the solicitation of bids must contain "reasonable detailed specifications describing the scope of a project." We see no reason why the analysis in OAG 92-143 should not be extended to the Kentucky Model Procurement Code, which states at KRS 45A.135, "Subject to the limitations of KRS 45A.125 and 45A.130 [prohibiting cost plus percentage and cost reimbursement contracts], any type of contract which will promote the best interests of the Commonwealth may be used." For capital construction contracts, design/bid and turnkey projects are specifically authorized by KRS 45A.045(10).
The third question is whether design/build energy saving projects must comply with the procedures set out in KRS 45A.800 to .835 regarding architectural and engineering services. Those statutes establish architectural and engineering services selection committees that screen and rank prospective suppliers of architectural and engineering services. The statutes broadly apply to "any undertaking requiring the professional services of an architect or engineer." KRS 45A.805(4). The purpose of the statutes is, among other things, to "award a contract for architectural or engineering services to the best firm, qualified to perform work on a project, on the basis of demonstrated competence and qualification for the type of professional services required and at a fair and reasonable price." KRS 45A.805(1)(c).
KRS 45A.800 to .835 contain no exemption for energy-saving projects. If a proposed contractor on an energy saving project provides a variety of services, including architectural or engineering work performed by employees rather than subcontractors, the statutes apply.
Although energy saving projects are likely to require both architectural and engineering services, the statutes make no provision for contracts in which architectural or engineering services are but one component of the contract. The statutes give no guidance whether to convene an architectural selection committee, an engineering selection committee, or both. Resolution of this question is amatter to be determined by the Finance and Administration Cabinet under KRS 45A.045. Promulgation of regulations under KRS 45A.045(2) will also afford applicable legislative committees an opportunity to review the 1996 legislation and determine whether legislative clarification is desirable.