NC Chamber Supports Bill to Limit Liability for IT Contractors in North Carolina

Senate Bill 792 (State IT Contracts/Contractor Liability), an important pro-jobs bill on the NC Chamber’s 2016 Jobs Agenda, is currently in the N.C. House after passing the Senate last month with unanimous support. The bill would set commonsense, competitive limitations on contractors’ liability to the state for damages related to information technology (IT) procurement contracts. The NC Chamber has supported and continues to support this bill in protecting and strengthening fair liability standards for IT contractors whose contributions have become an essential component of our state’s diverse, innovative economy.

North Carolina has a long history of protecting the fair limited liability rights job creators should justifiably expect from a state hoping to foster the most competitive climate for new business growth. Additionally, the National Association of State CIOs (NASCIO) has recommended that states remove unlimited liability clauses from state government terms and conditions. According to NASCIO: “States who have eliminated unlimited liability have also experienced an increased innovative and competitive contract culture.” And by creating more predictability in the contracting process and encouraging more qualified IT vendors to compete for state contracts, Senate Bill 792 would not only boost North Carolina’s attractiveness as a destination state for new businesses; it would also give state agencies more choice in the contracting process, reducing their costs and improving their results.

Many federal IT contracts limit liability to no more than the contract value, and a number of other states – including Tennessee, Florida, Connecticut, Michigan, New York and Texas – have already advanced competitive measures similar to Senate Bill 792. This bill came as a result of recommendations issued earlier this year by the Legislative IT Oversight Committee. The NC Chamber has been encouraged by the willingness of leaders in the General Assembly to recognize the importance of fair limited liability standards for job creators and work to provide tangible improvements in 2016. We will keep you updated as this important pro-jobs issue continues to move at the General Assembly.

Gary J. Salamido
Vice President, Government Affairs
North Carolina Chamber

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