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New Law Requires Contractors to Disclose the Sharing of Contract Commission/Fees in No-Bid State and Local Government Contracts

By Lisa A. Easterling

A new law (Act 868) passed by the Legislature and signed by Governor Bobby Jindal on July 2, 2010 requires contractors who are awarded no-bid contracts with state and local entities, or $10,000-plus bid contracts with local entities, to disclose all commissions and fees in writing.

Contractors must provide a notarized affidavit of the fee disposition on a form approved by the Board of Ethics. The affidavit shall include: (1) the full value of the commission, fee or other consideration; (2) the names of all parties to receive dispositions, splits, or shares of the commission, fee or other consideration; and, (3) the signature of the party authorized to commit the entity receiving the commission, fee or consideration to the contract.

If the fee sharing changes, a new affidavit reflecting the changes is required and must be recorded by the contractor in the public record. If the recorded affidavit is determined to be incorrect, then the contract becomes null, and all payment of the commission, fee, or other consideration shall be rebated to the state or local entity that entered into the contract.
 

Full post as published by Louisiana Law Blog on July 15, 2010 (boomark / email).