McDONALD, J.
The point of contention in this case is whether a local board of education has acted within its statutory authority. For some years, the Board of Education of Baltimore County ("Board of Education"), the Appellee, has belonged to a governmental group purchasing consortium — a sort of warehouse club for government entities — which competitively bid a roofing services contract on behalf of its members. The Board of Education has relied on that contract to fulfill its needs for roofing repair services. Appellant Building Materials Corporation of America, a nationwide manufacturer of roofing materials that does business under the name GAF Materials Corporation ("GAF"), questions the Board of Education's authority for that practice under the pertinent statutes.
A local board of education derives its powers and responsibilities from the State education law. One section of that law requires a local school system to conduct a competitive bidding process itself for procurement but explicitly authorizes the use of intergovernmental purchasing cooperatives for the purchase of "goods and commodities" — a phrase that ordinarily would not be understood to encompass construction services. In other parts of the education law, however, the Legislature has delegated substantial authority to the Board of Public Works and the Interagency Committee on School Construction to direct and oversee local school construction financed with State funds. Those agencies have endorsed the use of intergovernmental cooperatives in regulation and have specifically approved its use by the Board of Education for the acquisition of roofing services.
The Circuit Court for Baltimore County granted summary judgment in favor of the Board of Education. We affirm that judgment. When viewed in the context of the entire education law and regulations promulgated under that law, the competitive bidding statute does not bar the Board of Education from using its membership in an intergovernmental purchasing consortium for the procurement of roofing repair services.
In compliance with the constitutional directive to establish a "thorough and efficient" system of public education,
While local school boards are formally State agencies and receive a substantial proportion of their funding from the State, they are not subject to the State's general procurement law. Chesapeake Charter, supra. Other State statutes, however, control procurement by a local board. Under ED § 5-112, a local board must ordinarily follow competitive bidding procedures when procuring buildings, improvements, supplies, or equipment costing more than $25,000.
In regards to the construction of a particular type of building
ED § 5-301(d)(2); see also ED § 5-301(b) (BPW to adopt regulations on eligible and ineligible costs); § 5-301(b-1) (BPW to adopt regulations on indoor air quality for classrooms); § 4-126(c), (g) (BPW to adopt regulations governing alternative financing arrangements for school construction). In adopting regulations, the BPW is to provide for the "maximum exercise of initiative" by county school systems to ensure that school construction meets the needs of the community and is a prudent expenditure of State funds. ED § 5-301(d)(4).
County school boards are subject to the school construction regulations adopted by the BPW. ED § 5-301(g)(1). The Legislature has directed that, in the event of a conflict between those regulations and the "authority, responsibilities, powers and duties" of a county school board (or those of certain other State and local agencies), the BPW's regulations prevail. ED § 5-301(g)(2).
To assist the BPW in its duties related to school construction and to administer the State's public school construction program on behalf of the BPW, the Legislature has created the Interagency Committee on School Construction ("IAC").
Participation in intergovernmental cooperative purchasing arrangements, if done well, can yield savings in time and funds devoted to administering a procurement process, as well as result in a more favorable price. See National Association of State Purchasing Officers, Strength in Numbers: An Introduction to Cooperative Procurements, available at <www.naspo. org/documents/Cooperative_Purchasing 0410update.pdf>. In its school construction regulations, the BPW has endorsed the use of intergovernmental cooperative purchasing agreements as an alternative to competitive bidding procedures in certain circumstances. COMAR 23.03.03.03; COMAR 23.03.03.04; COMAR 23.03.03.12. In particular, the regulation concerning procurement methods provides:
COMAR 23.03.03.03 (emphasis added). The regulations further state a preference for the use of the competitive sealed bidding method, but permit the use of other methods under specified circumstances. COMAR 23.03.03.04.
COMAR 23.03.03.12.
In 2005, the Board of Education joined the Pennsylvania Education Joint Purchasing Council ("PAEJPC"), an intergovernmental purchasing cooperative that serves more than 300 school systems, colleges, and universities in Pennsylvania, Maryland, and West Virginia. See <www. paejpc.org> (last visited August 9, 2012). PAEJPC offers its members the opportunity to participate in various cooperative purchasing contracts, including a contract for roofing services, that have been developed through a competitive bidding process conducted by the Association of Educational Purchasing Agencies ("AEPA"), another government agency consortium.
In recent years, the successful bidder for the AEPA roofing services contracts has been Weatherproofing Technologies, Inc. ("TREMCO"), a competitor of GAF.
This case began when GAF filed a declaratory judgment action in January 2009 against the Board of Education in the Circuit Court for Baltimore County.
The parties filed cross motions for summary judgment. They agreed that there were no material facts in dispute and that the issue to be resolved was a question of law. Following a hearing on the motions,
As is evident, there is no dispute as to the underlying facts and, indeed, this case does not concern any particular procurement.
GAF asserts that the Board of Education, in awarding contracts to TREMCO through the purchasing cooperative, failed to comply with ED § 5-112 by not developing specifications, advertising for bids, and competitively awarding contracts itself. GAF further argues that the exception in ED § 5-112(a)(3) for purchases of "goods and commodities" through purchasing cooperatives does not apply because roofing services are not a "good" or "commodity." It contends that installation of a roof is an "improvement" for which the Board of Education should conduct its own competitive bidding process under ED § 5-112(b). In support of this argument, GAF cites the general State procurement regulations that define "improvement" as "the construction, maintenance, and repair of any building, structure, or other public work now or hereafter constructed or acquired by the State or any State agency." COMAR 21.01.02.01(B)(69).
The Board of Education disputes GAF's reading of ED § 5-112(a)(3), arguing that roofing repair services could qualify as "goods or commodities." It also points to the authority of the BPW and the IAC over school construction and the green light those agencies have given to its procurement of roofing services through the cooperative.
Much has been made of the "plain meaning rule" in the briefs filed by the parties. To be sure, plain meaning is a stalwart first step in our approach to statutory construction.
This Court has previously said that the competitive bidding provision of ED § 5-112 must be viewed in context. In Demory Bros., Inc. v. Board of Public Works, 273 Md. 320, 329 A.2d 674 (1974), a potential contractor opposed the award of a school construction contract on the basis that the competitive bidding statute
To place the competitive bidding statute for local board procurement in context, we take a brief detour into the history of the statutes relating to construction of local public schools. That review reveals that the key statutes are the product of three waves of legislative concern that occurred at 30-year intervals.
The Legislature first created a competitive bidding requirement for local school construction in 1933 when it enacted the predecessor of ED § 5-112. Chapter 151, § 59B, Laws of Maryland 1933, then codified at Article 77, § 59B.
This changed in the early 1970s. "In 1971 the State undertook a considerably expanded role in financing local school construction, and the [BPW] was assigned a much more active role in administering the program." Wilner, supra, at 104. The Legislature created the Public School Construction Program and gave the BPW significant responsibility, enacting the predecessors of the statutes now codified at ED § 5-301 et seq. Chapter 624, Laws of Maryland 1971. The BPW was authorized to adopt "rules, regulations, and procedures" on a broad range of activities related to school construction.
Approximately 30 years later, the General Assembly authorized greater reliance on procurement methods other than locally-conducted competitive bidding. In particular, in several instances it endorsed the use of collaborative purchasing methods as an alternative to competitive bidding. It also delegated additional authority to the BPW and IAC with respect to local school construction. And it commissioned a comprehensive review of public school construction in Maryland.
In 2002, the Legislature qualified the competitive bidding requirement in ED § 5-112. It amended that statute to specifically allow local boards of education to participate in intergovernmental purchasing organizations to purchase goods and commodities. Chapters 170, 171, Laws of Maryland 2002, codified at ED 5-112(a)(3).
Several of the Task Force's recommendations are relevant to the issue before us. The Task Force noted that many policy decisions had been delegated to the BPW and IAC; it recommended that those policy decisions be expressed in regulations subject to the State Administrative Procedure Act. Task Force Report at pp. 43-46. The Task Force also recommended that local school systems be afforded the flexibility to use alternative financing methods for school construction and "to develop the procurement, contractual, and technical instruments that will meet State and local procurement requirements and bring the project to a successful conclusion." Id. at 41. It also encouraged pooling by school systems in certain types of contracts, recommending that the State "distribute information on existing State purchasing contracts for school furniture, equipment, and services that may be shared by local school systems." Id. at 58.
The Legislature responded to the Task Force Report by adopting the Public School Facilities Act of 2004. Chapters 306, 307, Laws of Maryland 2004. That legislation authorized local school systems, in a new ED § 4-126, to use "alternative financing methods" for public school construction in accordance with regulations adopted by the BPW, to use alternative methods of project delivery (e.g., construction manager at risk), and to procure school construction by methods other than competitive bidding (e.g., competitive negotiation, acceptance of unsolicited proposals, quality-based selection).
In the same legislation, the General Assembly also expanded the BPW's authority under ED § 5-301 to adopt regulations governing school construction generally to include, among other things, "the award of contracts by school systems." Id., § 2. The BPW exercised its expanded authority to adopt the regulations quoted earlier that authorize local school systems to use intergovernmental cooperative purchasing, including piggybacking and pooling arrangements. COMAR 23.03.03.03; COMAR 23.03.03.12.
As the above history demonstrates, the competitive bidding requirement of ED § 5-112 is longstanding and predates the significant involvement of the State in subsidizing the construction of local schools. As the State role in financing of public education subsequently increased, the General Assembly has modified the general preference for sealed competitive bidding, particularly in the area of school construction, and delegated substantial authority to the BPW to oversee the financing, procurement, and construction of schools.
These legislative directives to the BPW leave no doubt that the regulations adopted by the BPW are to be treated as "substantive" or "legislative" regulations that are binding on the courts and have the "force of law." Sec'y Dep't of Pub. Safety & Corr. Servs. v. Demby, 390 Md. 580, 604-5, 890 A.2d 310, 325 (2006) (citing Jerri's Ceramic Arts, Inc. v. Consumer Prod. Safety Comm'n, 874 F.2d 205, 207-08 (4th Cir.1989)).
As indicated above, ED § 5-112 — which applies generally to local board procurements — allows local boards to use contracts awarded by intergovernmental purchasing organizations for the procurement of "goods" or "commodities" — terms that are not defined in the education law. Roofing repair services would appear to be outside those terms under the definitions that GAF marshals from a variety of sources.
The meaning of "good" and "commodity" in ED § 5-112 may seem plain enough even without the aid of a statutory definition, but those two terms are not all we must consider. As noted above, other enactments of the General Assembly which, unlike ED § 5-112,
Under its statutory authority, and on the recommendation of the IAC, the BPW has adopted regulations that permit local systems to draw upon intergovernmental cooperative purchasing agreements for various needs. The key regulation authorizes the use of intergovernmental cooperative purchasing not only to buy goods and commodities but also to purchase "requirements" under an intergovernmental purchasing agreement of another governmental entity. COMAR 23.03.03.12A. Under the regulation, a local school system may use such an intergovernmental purchasing agreement if it is not attempting to avoid competition and if it perceives benefits, in terms of cost, efficiency, or governmental cooperation, from that use. COMAR 23.03.03.12B. The regulation identifies two common types of intergovernmental purchasing arrangements — pooling and piggybacking. COMAR 23.03.03.12C.
Whether roofing repair services could ever be characterized as a "good" or "commodity," they were certainly among the "requirements" of the Board of Education to maintain adequate school facilities. The AEPA contract utilized by the Board of Education appears to be a form of pooling. In electing to use such a contract, the Board of Education perceived benefits in terms of cost and other factors.
One might read the BPW regulations narrowly to allow participation in intergovernmental cooperative purchasing organizations only for the purchase of goods and commodities. In that view, the regulations were simply meant to incorporate ED § 5-112(a)(3) — it would not be the first time
In approving and funding the various roofing services contracts submitted by the Board of Education, the BPW agreed that they were within the purview of its regulations.
In sum, ED § 5-112 embodies a longstanding requirement that local school systems generally use competitive bidding for procurement. But that prescription cannot be viewed in isolation from the history of the State's growing involvement in local school construction, the significant authority delegated to the BPW and IAC to oversee school construction, and the several authorizations for local school systems to use alternative methods of financing, procurement, and project delivery (of which the exception in ED § 5-112(a)(3) is just
We hold that ED § 5-112 does not bar the Board of Education from procuring its needs for roofing repair services through an intergovernmental purchasing cooperative when it acts pursuant to the authority of a BPW regulation that had been adopted in accordance with a legislative delegation of authority to the BPW. Whether it is wise to use a purchasing consortium for roof repair services is not for us to assess; we only determine whether that decision was within the authority granted to the Board of Education by the BPW under its statutory delegation — a delegation that the Legislature may retract or modify. If those decisions are imprudent, it is the General Assembly that holds the ultimate trump card.
ED § 5-301(g) (emphasis added).
Chapter 624, Laws of Maryland 1971, then codified at Maryland Code, Article 77, § 130A.