Section R19-3-501. Definitions

In this Article, unless the context otherwise requires:

1.        “Affiliate” means any person whose governing instru- ments require it to be bound by the decision of another person or whose governing board includes enough voting representatives of the other person to cause or prevent action, whether or not the power is exercised. The term applies to persons doing business under a variety of names, persons in a parent-subsidiary relationship, or per- sons that are similarly affiliated.

2.        “Aggregate dollar amount” means purchase price, includ- ing taxes and delivery charges, for the term of the con- tract and  accounting  for  all allowable  extensions and options.

3.        “Best interests of the Lottery” means advantageous to the Lottery.

4.        “Bid” means an offer in response to solicitation.

5.        “Business” means a corporation, partnership, individual, sole proprietorship, joint stock company, joint venture, or other private legal entity.

6.        “Change order” means a document, signed by the Direc- tor, which directs the contractor to make a change that the contract authorizes the Director to order.

7.        “Competitive range” is a range determined by the pro- curement officer on the basis of the criteria stated in the solicitation and an initial review of the proposals submit- ted. Those proposals that are susceptible for award after the initial review of all original proposals in accordance with the evaluation criteria and a comparison and ranking of original proposals shall be in the competitive range. Those proposals that have no reasonable chance for award when compared on a relative basis with more highly ranked proposals will not be in the competitive range. Proposals to be considered within the competitive range must, at a minimum, demonstrate the following:

a.         Affirmative compliance with mandatory require- ments designated in the solicitation.

b.        An ability to deliver goods or services on terms advantageous to the Lottery sufficient to be entitled to continue in the competition.

c.         That the proposal is technically acceptable as sub- mitted.

8.        “Contract” means an agreement, regardless of what it is called, for the procurement of Lottery equipment, tickets, and related materials.

9.        “Contract amendment” means a written alteration in the terms or conditions of a contract accomplished by mutual action of the parties to the contract or a unilateral exercise of a right contained in the contract.

10.     “Contractor” means a person who has a contract with the Lottery.

11.     “Cost data” means information concerning the actual or estimated cost of labor, material, overhead, and other cost elements that have been incurred or are expected to be incurred by the contractor in performing the contract.

12.     “Cost-plus-a-percentage-of-cost-contract” means the par- ties to a contract agree that the fee will be a predeter- mined percentage of the cost of work performed and the contract does not limit the cost and fee before authoriza- tion of performance.

13.     “Cost reimbursement contract” means a contract under which a contractor is reimbursed for costs that are reason- able, allowable, and allocable in accordance with the con- tact terms and the provisions of this Article, and a fee, if provided for in the contract.

14.     “Day”  means  a   calendar  day  and  is  computed  under

A.R.S. § 1-243, unless otherwise specified in the solicita- tion or contract.

15.     “Defective data” means data that is inaccurate, incom- plete, or outdated.

16.     “Director” means the Executive Director of the State Lot- tery.

17.     “Discussions” means oral or written negotiation between the Lottery and an offeror during which information is exchanged about specifications, scope of work, terms and conditions, and price included in an initial proposal. Communication with an offeror for the sole purpose of clarification does not constitute “discussions.”

18.     “Filed” means delivered to the Arizona Lottery, 4740 E. University Dr., Phoenix, AZ 85034. A time/date stamp affixed to a document by the procurement officer or the

procurement  officer’s  delegate  when  the  document   is delivered determines the time of filing.

19.     “Governing instruments” means legal documents that establish the existence of an organization and define its powers, including articles of incorporation or association, constitution, charter, bylaws, or similar documents.

20.     “Interested party” means an offeror or prospective offeror whose economic interest may be affected substantially and directly by the issuance of a solicitation, the award of a contract, or by the failure to award a contract. Whether an offeror or prospective offeror has an economic interest depends upon the circumstances of each case.

21.     “Invitation for bids” means all documents, whether attached or incorporated by reference, that are used to solicit bids in accordance with R19-3-508.

22.     “Minor informality” means any mistake, excluding a judgmental error, that has negligible effect on price, quantity, quality, delivery, or other contractual terms and the waiver or correction of which does not prejudice other bidders or offerors.

23.     “Multiple award” means a grant of an indefinite quantity contract for one or more similar materials or services to more than one bidder or offeror.

24.     “Multi-step sealed bidding” means a two-phase bidding process consisting of a technical phase and a price phase.

25.     “Negotiation” means an exchange or series of exchanges between the Lottery and an offeror or contractor that allows the Lottery or the offeror or contractor to revise an offer or contract, unless revision is specifically prohibited by these rules or statutes.

26.     “Offer” means a response to a solicitation.

27.     “Offeror” means a person who responds to a solicitation.

28.     “Person” means any corporation, limited liability com- pany, limited liability partnership, partnership, business, individual, union, committee, club, other organization, or group of individuals.

29.     “Price data” means information concerning prices, including profit, for materials, services, or construction substantially similar to the materials, services, or con- struction to be procured under a contract or subcontract. In this definition, “prices” refers to offered selling prices, historical selling prices, or current selling prices of the items to be purchased.

30.     “Procurement” means all functions that pertain to obtain- ing any materials or services for the design or operation of a Lottery game or the purchase of Lottery equipment, tickets, and related materials.

31.     “Procurement file” means the official records file of the Lottery. The procurement file shall include (electronic or paper) the following:

a.         List of notified vendors;

b.        Final solicitation;

c.         Solicitation amendments;

d.        Bids and offers;

e.         Final proposal revisions;

f.         Discussions;

g.        Clarifications;

h.        Final evaluation reports; and

i.         Additional information, if requested by the procure- ment officer.

32.  “Proposal” means an offer submitted in response to a solic- itation.

33.   “Prospective offeror” means a person that expresses an interest in a specific solicitation.

34.  “Purchase description” means the words used in a solicita- tion to describe Lottery materials to be procured and

includes specifications attached to, or made a part of, the solicitation.

35.  “Purchase request” or “purchase requisition” means a doc- ument or electronic transmission in which the Director requests that a contract be entered into for a specific need and may include a description of a requested item, deliv- ery schedule, transportation data, criteria for evaluation, suggested sources of supply, and information needed to make a written determination required by this Article.

36.   “Request for proposals” means all documents, whether attached or incorporated by reference, that are used to solicit proposals in accordance with R19-3-509.

37.  “Responsible bidder or offeror” means a person who has the capability to perform contract requirements and the integrity and reliability necessary to ensure a good faith performance.

38.  “Responsive bidder or offeror” means a person who sub- mits a bid that conforms in all material respects to the invitation for bids or request for proposals.

39.  “Reverse auction” means a procurement method in which offerors are invited to bid on specified goods or services through online bidding and real-time electronic bidding. During an electronic bidding process, offerors’ prices or relative ranking are available to competing offerors and offerors may modify their offer prices until the closing date and time.

40.  “Services” means the labor, time, or effort furnished by a contractor with no expectation that a specific end product other than required reports and performance will be deliv- ered. Services does not include employment agreements or collective bargaining agreements.

41.  “Small business” means a for-profit or not-for-profit orga- nization, including its affiliates, with fewer than 100 full- time employees or gross annual receipts of less than four million dollars for the last complete fiscal year.

42.  “Solicitation” means an invitation for bids, a request for technical offers, a request for proposals, a request for quotations, or any other invitation or request issued by the Lottery to invite a person to submit an offer.

43.   “Specification” means a description of the physical or functional characteristics, or of the nature of a Lottery material or service. Specification includes a description of any requirement for inspecting, testing, or preparing a Lottery material for delivery.

44.  “Subcontractor” means a person who contracts to perform work or render service to a contractor or to another sub- contractor as a part of a contract with the Lottery.

45.  “Suspension” means an action taken by the Director of the Department of Administration under R2-7-C901 that temporarily disqualifies a person from participating in a state procurement process.

46.    “Technical offer” means unpriced written information from a prospective contractor stating the manner in which the prospective contractor intends to perform certain work, its qualifications, and its terms and conditions.

47.   “Trade secret” means information, including a formula, pattern, device, compilation, program, method, tech- nique, or process, that is the subject of reasonable efforts to maintain its secrecy and that derives independent eco- nomic value, actual or potential, as a result of not being generally known to and not being readily ascertainable by legal means.

Historical Note

Adopted as an emergency effective June 5, 1985, pursu- ant to A.R.S. § 41-1003, valid for only 90 days (Supp. 85- 3). Adopted as a permanent rule effective August 29,

1985 (Supp. 85-4). Former Section R4-37-501 repealed, new Section R4-37-501 renumbered from R4-37-502 and amended effective May 7, 1990 (Supp. 90-2). R19-3-501 recodified from R4-37-501 (Supp. 95-1). Amended effec- tive December 16, 1997 (Supp. 97-4). Amended by final

rulemaking at 12 A.A.R. 4495, effective January 6, 2007 (Supp. 06-4). Amended by final rulemaking at 19 A.A.R.

1641, effective August 4, 2013 (Supp. 13-2).