Bill
H 3380
Strengthen taxpayer protections by expanding agency scope and enforcing strict oversight of privatization contracts: CPI-based costs, no revenue sharing, and mandatory audits.
Overview
- Purpose: Strengthen protections around privatization of state services by increasing agency accountability, tightening definitions, and enhancing oversight and financial scrutiny to ensure costs borne by residents are controlled and contracts are fair and transparent.
- Status: Hearing scheduled for July 22, 2025, 10:00 AM–1:00 PM (Room A-1). Introduced February 27, 2025. Referred to the House committee on State Administration and Regulatory Oversight; Senate concurrence noted during initial actions. Related bill HD 3259 is listed as a replacement.
What the bill would change (key provisions)
1) Expanded definition of “Agency”
- The bill redefines “Agency” to include:
- Executive offices, departments, divisions, boards, commissions or other offices in the executive branch
- Massachusetts Bay Transportation Authority (MBTA)
- Massachusetts Turnpike Authority
- Massachusetts Department of Transportation (MassDOT)
- Massachusetts Port Authority
- Woods Hole, Martha’s Vineyard and Nantucket Steamship Authority
- A school district defined in section 2 of chapter 70
- An education collaborative established under section 4E of chapter 40
2) Redefined “Privatization contract”
- A privatization contract is an agreement (or series of agreements) where a non-governmental entity provides services previously performed by public employees.
- Threshold: initially valued at $500,000, adjusted annually on January 1 to reflect changes in the Consumer Price Index (CPI) for all urban consumers.
- All subsequent agreements (rebids, renewals, extensions) are considered privatization contracts.
- Exemptions/clarifications:
- IT services contract is not a privatization contract if an employee organization (recognized under chapter 150E) agrees in writing to the terms.
- Purely legal, planning, engineering, or design services are not privatization contracts.
3) Cost and pricing protections for privatized services
- If a contract proposal would increase costs for services or products to residents, the contract price must reflect those higher costs accordingly.
- Prohibition on certain revenue-sharing payments: no privatization contract may pay based on a percentage of revenue or fees (e.g., tuition sharing).
4) Auditor oversight and enforcement enhancements
- Objections by the State Auditor (previously under Section 55) become final and binding unless the Auditor withdraws in writing with stated reasons after review.
- The Attorney General may bring civil action for equitable relief to enforce Sections 52–55 or to remedy adverse employee actions due to violations.
- Pre-renewal audits: before renewing a privatization contract, the State Auditor must conduct a financial and performance audit to ensure compliance.
Who would be affected
- State agencies and agencies within the expanded definition (including major transportation and education entities)
- Privatization contractors and potential bidders for contracted services
- Public employees (indirectly, through the governance and protection provisions)
- Residents of the Commonwealth, as cost controls and pricing protections are tied to services delivered to them
- Labor unions/employee organizations negotiating IT terms (due to IT exemptions when written union agreement is in place)
Procedural and timeline aspects
- Introduced: February 27, 2025
- Referred to: Committee on State Administration and Regulatory Oversight (same day as introduction)
- Hearing: July 22, 2025, 10:00 AM–1:00 PM, in Room A-1
- Related actions: Senate concurrence noted in early actions; House Docket number 3380 accompanies House Bill 3380; HD 3259 listed as related/replacing version
Notes
- The bill explicitly links annual CPI adjustments to the privatization-cap threshold and tightens financial accountability via mandatory audits and stricter dispute resolution by the State Auditor. No fiscal impact figures are provided in the summary text available.
Compiled from official sources — confirm details with the bill’s official record.
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