§ 23-115-501 - Vendors -- Requirements when submitting a bid, proposal, or offer -- Major procurement contract.
23-115-501. Vendors -- Requirements when submitting a bid, proposal, or offer -- Major procurement contract.
(a) The Arkansas Lottery Commission shall investigate the financial responsibility, security, and integrity of a vendor who is a finalist in submitting a bid, proposal, or offer as part of a major procurement contract.
(b) At the time of submitting a bid, proposal, or offer to the commission, the commission shall require the following items:
(1) A disclosure of the vendor's name and address and, as applicable, the names and addresses of the following:
(A) (i) If the vendor is a corporation, the officers, directors, and each stockholder of more than a ten percent (10%) interest in the corporation.
(ii) However, in the case of owners of equity securities of a publicly traded corporation, only the names and addresses of those known to the corporation to own beneficially five percent (5%) or more of the securities need be disclosed;
(B) If the vendor is a trust, the trustee and all persons entitled to receive income or benefits from the trust;
(C) If the vendor is an association, the members, officers, and directors; and
(D) If the vendor is a partnership or joint venture, all of the general partners, limited partners, or joint venturers;
(2) A disclosure of all the states and jurisdictions in which the vendor does business and the nature of the business for each state or jurisdiction;
(3) A disclosure of all the states and jurisdictions in which the vendor has contracts to supply gaming goods or services, including without limitation lottery goods and services, and the nature of the goods or services involved for each state or jurisdiction;
(4) (A) A disclosure of all the states and jurisdictions in which the vendor has applied for, has sought renewal of, has received, has been denied, has pending, or has had revoked a lottery or gaming license of any kind or had fines or penalties assessed to the vendor's license, contract, or operation and the disposition of each instance in each state or jurisdiction.
(B) If any lottery or gaming license or contract has been revoked or has not been renewed or any lottery or gaming license or application has been either denied or is pending and has remained pending for more than six (6) months, all of the facts and circumstances underlying the failure to receive a license shall be disclosed;
(5) (A) A disclosure of the details of any finding or plea, conviction, or adjudication of guilt in a state or federal court of the vendor for any felony or any other criminal offense other than a traffic violation committed by the persons identified under subdivision (b)(1) of this section.
(B) (i) The commission may request that any or all of the persons identified under subdivision (b)(1) of this section undergo a state and federal criminal background check.
(ii) If requested, a state and federal criminal background check shall be conducted in the manner under 23-115-601(e);
(6) A disclosure of the details of any bankruptcy, insolvency, reorganization, or corporate or individual purchase or takeover of another corporation, including without limitation bonded indebtedness, and any pending litigation of the vendor;
(7) A disclosure of the vendor's most recent financial report, including any reports on internal control over financial reporting, and the most recent audit report of the vendor's operation as a service organization; and
(8) Additional disclosures and information that the commission may determine to be appropriate for the procurement involved.
(c) If any portion of a vendor's contract is subcontracted, the vendor shall disclose all of the information required by this section for the subcontractor as if the subcontractor were itself a vendor.
(d) (1) The commission shall not enter into a major procurement contract with a vendor that:
(A) Has not complied with the disclosure requirements described in subsection (b) of this section;
(B) Has been found guilty of a felony related to the security or integrity of a lottery in this or any other jurisdiction; or
(C) Has an ownership interest in an entity that has supplied lottery goods or services under contract to the commission regarding the request for proposals pertaining to those particular goods or services.
(2) The commission may terminate a major procurement contract with a vendor that does not comply with requirements for periodically updating disclosures during the tenure of the major procurement contract as may be specified in the major procurement contract.
(3) This section shall be construed broadly and liberally to achieve full disclosure of all information necessary to allow for a full and complete evaluation by the commission of the competence, integrity, background, and character of vendors for major procurement contracts.
(e) (1) A vendor who provides or proposes to provide goods or services under a major procurement contract shall not provide a gift or compensation to:
(A) The Director of the Arkansas Lottery Commission, a commission member, a commission employee, or a member of the Arkansas Lottery Commission Legislative Oversight Committee; or
(B) A member of the immediate family of the director, a commission member, a commission employee, or a member of the Arkansas Lottery Commission Legislative Oversight Committee.
(2) (A) Any person who knowingly violates subdivision (e)(1) of this section shall be guilty of a Class A misdemeanor.
(B) (i) The Arkansas Ethics Commission shall also have the authority to investigate and address alleged violations of subdivision (e)(1) of this section.
(ii) The Arkansas Ethics Commission shall have the same power and authority to enforce the provisions of subdivision (e)(1) of this section as granted to it under 7-6-217 and 7-6-218.
(f) (1) A public official shall not knowingly own a financial interest in a vendor.
(2) (A) If a public official becomes aware that he or she owns a financial interest in a vendor, the public official shall divest the financial interest as soon as possible.
(B) A public official shall not divest the financial interest to a member of his or her immediate family.