State contracts preclusion with a person or business convicted of fraud

2025-2026 Regular Session Introduced by Steve Drazkowski and 1 co-sponsor

The bill blocks state contracts with any person or business convicted of fraud, banning their eligibility in procurement and contract awards.

Author added Drazkowski

#commerceandcommercedepartment #government-state

Purpose and Intent

SF 4874 aims to prohibit state contracts with individuals or entities that have been convicted of fraud. The bill seeks to strengthen integrity in public procurement by disqualifying bidders and awardees who have a fraud conviction, thereby protecting taxpayers and ensuring government contracts are awarded to ethically responsible parties.

Key Provisions and Changes

Prohibition on State Contracts: The bill would bar state agencies from awarding contracts to any person or business that has been convicted of fraud. This includes contracting with vendors that have fraud-related convictions, subject to the bill’s applicability and definitions.

Scope of Prohibition: The disqualification applies to contracts with the state (and potentially its political subdivisions aligned with the bill’s text). It targets fraud convictions, rather than other offenses, as the basis for exclusion.

Definitions: The bill provides a legal definition of “fraud” or “fraud conviction” to determine when a vendor is disqualified. This typically includes criminal convictions for fraud, false statements, bribery, kickbacks, or similar deceptive practices, but the exact scope would be defined in the bill’s text.

Application to Bidders and Awardees: The measure would apply during the procurement process, potentially affecting bid evaluations, bid acceptance, and contract award decisions. Bidders with fraud convictions would be ineligible to receive state contracts.

Remedies and Compliance: The bill may include provisions on handling disclosures, presumptions, and procedures for debarment or ineligibility determinations. It may also address opportunities for remedy, appeal, or time-bound prohibitions if new evidence emerges, though exact procedural details depend on the final language.

Affected Parties

Vendors and Contractors: Businesses and individuals seeking or holding state contracts would be directly affected if they have a fraud conviction.

State Agencies and Procurement Officials: Agencies responsible for contract solicitation, evaluation, and award would implement the exclusion, verify eligibility, and enforce prohibitions.

Bidders and Subcontractors: Bid teams, including prime contractors and relevant subcontractors, would need to ensure none of their team members or parent entities have qualifying fraud convictions.

Procedural and Timeline Aspects

Introduction and Referral: Introduced March 26, 2026, and referred to the State and Local Government committee.

Committee Action: On April 7, 2026, the committee reported “to pass as amended,” indicating the bill passed the committee with amendments.

Legislative Progress: As of the latest action, the bill is moving through the standard Minnesota Senate process, with potential floor votes to follow depending on committee reports and scheduling.

Additional Context

Sponsors: Co-sponsored by Heather Gustafson and Steve Drazkowski, with Drazkowski added as a co-sponsor on April 7, 2026.

The exact text, including precise definitions, exceptions (if any), and enforcement mechanisms, would be found in the bill’s statutory language and any adopted amendments.

If you’d like, I can pull the specific statutory definitions, any proposed exceptions (e.g., minor offenses, expunged convictions, or time-based prohibitions), and the enforcement/regulatory details from the final bill text once available.

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