Section 67-1-205 - Warehouse and distribution operations(1) The department shall contract for warehouse and distribution operations. The shipping contract in effect on July 1, 2022, shall remain in effect until the expiration of its term.(2) The department shall pay regular maintenance expenses and shall reimburse the operator for services performed under the contract out of monies appropriated by the Legislature.(3) The contract shall include the following terms: (a) The department shall pay the operator cost-plus on these operations at a set dollar amount per case of alcoholic beverages sold. Otherwise, the contract shall not alter the current cash flow of operations;(b) The operator shall be allotted a monthly spending limit for occasional improvements. The state may, at any time, review the operator's spending. The operator shall obtain prior state approval for any spending over the monthly limit set in the contract. The contract shall allow the operator to pay out of pocket, in which case the state will reimburse the operator on a monthly basis out of monies in the ABC Warehouse Improvements Fund created in Section 67-1-211(2);(c) Shipping costs, where the contract encompasses shipping, shall be based on a set dollar amount per case of alcoholic beverages shipped from the warehouse to the permittee's premises;(d) The department and the operator may provide for the operator's software to interface with the department's TAP system in a manner allowing for information sharing in furtherance of efficient operations while also protecting the security of the TAP system;(e) The department shall develop quality and efficiency criteria for determining whether to renew a contract for warehouse and distribution operations;(f) The obligation of the department to proceed under the contract is conditioned upon the appropriation of funds by the Legislature and the receipt of state or federal funds. If the funds anticipated for the continuing time fulfillment of the agreement are, at any time, not forthcoming or insufficient, either through the failure of the federal government to provide funds or of the State of Mississippi to appropriate funds, or the discontinuance or material alteration of the program under which funds were provided, or if funds are not otherwise available to the department, the department shall have the right, upon ten (10) working days' written notice to the operator, to terminate this agreement without damage, penalty, cost or other expenses to the department of any kind whatsoever. The effective date of termination shall be as specified in the notice of termination;(g) The state and the operator as parties to the contract and all terms of the contract shall be subject to and governed by the laws of the state at the time the contract is entered into, and any later amendments to such laws, through the duration of the contract; and(h) The operator shall be required to comply with any duties, responsibilities, conditions or other provisions required by state law during the duration of the contract, regardless of whether such duties, responsibilities, conditions or other provisions were required by state law at the time the contract was entered into.(4) The initial contract for operations shall terminate on the earlier of: (a) four (4) years from the date it commences; or(b) the last day of the use of the warehouse that is in service on July 1, 2022. The contract may be renewed for four (4) years, with another option to renew at the end of that four-year term. The department shall issue requests for proposals before entering any subsequent contract. Requests for proposals shall be required whenever a contract is not renewed, but no less frequently than every twelve (12) years.(5) The contract shall provide that all employees needed for operations shall be employees of the operator.(6) A contract for warehouse and distribution operations shall not be entered into unless the operator has demonstrated:(a) The qualifications, experience and management personnel necessary to carry out the terms of the contract; and(b) The ability to comply with applicable federal and state laws.(7) A contract for operations shall not be entered into unless the following requirements are met: (a) In addition to fire and casualty insurance, the operator provides at least Ten Million Dollars ($10,000,000.00) of liability insurance. The liability insurance shall be issued by an insurance company with a rating of at least an A- according to AM Best standards. In determining the adequacy of such insurance, the Department of Finance and Administration shall determine whether:(i) The insurance is adequate to protect the state from any and all actions by a third party against the operator or the state as a result of the contract;(ii) The insurance is adequate to protect the state against any and all claims arising as a result of any occurrence during the term of the contract;(iii) The insurance is adequate to assure the operator's ability to fulfill its contract with the state in all respects, and to assure that the operator is not limited in this ability because of financial liability which results from judgments; and(iv) The insurance is adequate to satisfy such other requirements specified by the independent risk management/actuarial firm.(b) The sovereign immunity of the state shall not apply to the operator. Neither the operator nor the operator's insurer may plead the defense of sovereign immunity in any action arising out of the performance of the contract.(c) The operator shall post a performance bond to assure the operator's faithful performance of the specifications and conditions of the contract. The bond is required throughout the term of the contract. The terms and conditions must be approved by the department and the Department of Finance and Administration, and such approval is a condition precedent to the contract taking effect.(d) The operator shall defend any suit or claim brought against the state arising out of any act or omission in operations, and shall hold the state harmless from such claim or suit. The operator shall be solely responsible for the payment of any legal or other costs relative to any such claim or suit. The operator shall reimburse the state for any costs that it may incur as a result of such claim or suit immediately upon being submitted a statement therefor by the Attorney General. Any suit brought or claim made arising out of any act or omission in operations shall be made or brought against the operator and not the state.
The Attorney General retains all rights and emoluments of his or her office which include direction and control over any litigation or claim involving the state.
Brought forward by Laws, 2024, ch. 520, HB 1354,§ 4, eff. 7/1/2024.Added by Laws, 2022, ch. 483, SB 2844,§ 3, eff. 7/1/2022.