Wisconsin Legislature is Considering Changes to Contractual Services Law: How Will it Affect Your Business?

January 21, 2009

written by Patrick J. Farley
The State legislature is considering making changes to how Wisconsin purchases contractual services. The following describes the current law in Wisconsin, the proposed changes just introduced in the legislature and some issues businesses may want to keep in mind.

Current State of Wisconsin Law
Currently, Wisconsin allows the state to contract for services that can be performed more economically or efficiently by contract than by state employees. These services may be performed anywhere in the world.

AB 2 – Performance of Services in the United States
AB 2 would require the state to only purchase contractual services that are performed within the United States. There are some exceptions to this requirement, including:

  • Contractual services that are not available to be performed within the United States
  • If any part of the contract is paid for with federal money Contractual services purchased by the University of Wisconsin System Board Of Regents using gifts, grants and endowment trust fund income
  • Renewal, modification or extension of existing contracts at the time the law takes effect

Issues for Businesses
There are a number of things that businesses need to keep in mind and watch for as AB 2 makes its way through the legislative process, for example:

  • What if part of your business operates in a foreign nation and provides support for your domestic operations?
  • What about your subcontractors – are they covered and to what extent?
  • What if you are a foreign company doing business in the United States – what does this mean for you?
  • How will the state implement this law? For example, will there be new audit requirements during the life of a given service contract? Will there be new self reporting requirements?

View the History of Assembly Bill 2