Bill Text: NY A02321 | 2021-2022 | General Assembly | Amended

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Bill Title: Relates to increased participation in state contracts and subcontracts by certified minority and women owned business enterprises; relates to certain performance and payment bond requirements.

Spectrum: Partisan Bill (Democrat 7-0)

Status: (Introduced - Dead) 2022-05-27 - print number 2321a [A02321 Detail]

Download: New_York-2021-A02321-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         2321--A

                               2021-2022 Regular Sessions

                   IN ASSEMBLY

                                    January 14, 2021
                                       ___________

        Introduced  by  M.  of A. SIMON, GLICK, HYNDMAN, ZINERMAN -- Multi-Spon-
          sored by -- M. of A. COOK,  GOTTFRIED,  SEAWRIGHT  --  read  once  and
          referred to the Committee on Governmental Operations -- recommitted to
          the  Committee  on Governmental Operations in accordance with Assembly
          Rule  3,  sec.  2  --  committee  discharged,  bill  amended,  ordered
          reprinted as amended and recommitted to said committee

        AN  ACT  to  amend  the  executive  law, in relation to participation by
          minority group  members  and  women  with  respect  to  certain  state
          contracts;  and  to amend the state finance law, in relation to estab-
          lishing a mentor-protege program for small  and  minority  and  women-
          owned  business  concerns  and  in relation to performance and payment
          bond requirements

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Subdivisions 3 and 4 of section 311 of the executive law,
     2  subdivision 3 as added by chapter 261 of the laws  of  1988,  paragraphs
     3  (d)  and  (e)  of  subdivision 3 as amended by chapter 55 of the laws of
     4  1992, paragraph (g) of subdivision 3 as amended by section 1 of part  BB
     5  of chapter 59 of the laws of 2006, paragraphs (h), (i) and (j) of subdi-
     6  vision 3 as amended and paragraph (k) of subdivision 3 as added by chap-
     7  ter  825 of the laws of 2021, subdivision 4 as amended by chapter 361 of
     8  the laws of 2009, and paragraph (f) of subdivision  3  and  the  opening
     9  paragraph of subdivision 4 as amended and paragraph (d-1) of subdivision
    10  3  and paragraphs (d) and (e) of subdivision 4 as added by chapter 96 of
    11  the laws of 2019, are amended to read as follows:
    12    3. The director shall have the following powers and duties:
    13    (a) to encourage and assist contracting agencies in their  efforts  to
    14  increase  participation by minority and women-owned business enterprises
    15  on state contracts and subcontracts so as to facilitate the award  of  a
    16  fair  share  of  such contracts to them and to provide on the division's

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD01192-03-2
        A. 2321--A                          2

     1  website a list of each contracting  agency's  minority  and  women-owned
     2  business enterprises certification outreach seminars;
     3    (b) to develop standardized forms and reporting documents necessary to
     4  implement this article;
     5    (c)  to conduct educational outreach programs to encourage the certif-
     6  ication of minority and women-owned business enterprises consistent with
     7  the purposes of this article;
     8    (d) to review [periodically] quarterly the practices and procedures of
     9  each contracting agency with respect to compliance with  the  provisions
    10  of  this  article,  and  to  require  them  to file [periodic] quarterly
    11  reports with the division of minority and women's  business  development
    12  as to the level of minority and women-owned business enterprises partic-
    13  ipation  in  the  awarding  of  agency  contracts for goods and services
    14  including but not limited to the number of state  contracts  awarded  to
    15  certified  minority-owned or women-owned business enterprises, the maxi-
    16  mum dollar amount obligated pursuant to all  those  contracts,  and  the
    17  total  expenditures  made  pursuant to all such contracts; the number of
    18  state contracts awarded to certified minority  or  women-owned  business
    19  enterprises,  the  maximum dollar amount obligated pursuant to all those
    20  contracts,  and  the  total  expenditures  made  pursuant  to  all  such
    21  contracts;  the number of state contracts awarded which include a utili-
    22  zation plan for business participation by certified minority  or  women-
    23  owned  business  enterprises,  the  maximum amount obligated pursuant to
    24  those contracts, and the total expenditures made pursuant  to  all  such
    25  contracts; the number of state contracts awarded upon which a waiver was
    26  granted  from goals required by the contracts for business participation
    27  by certified minority or women-owned business enterprises, and the maxi-
    28  mum amount obligated pursuant to those contracts; the  number  of  state
    29  contracts  awarded which required goals for employment of minority group
    30  members and women; and the number of state contracts awarded  for  which
    31  waivers of employment goals required by the contracts have been granted;
    32    (d-1) to require all contracting state agencies to develop a four-year
    33  growth  plan  to  determine  a means of promoting and increasing partic-
    34  ipation by minority-owned  and  women-owned  business  enterprises  with
    35  respect to state contracts and subcontracts. Every four years, beginning
    36  September  fifteenth, two thousand twenty, each contracting state agency
    37  shall submit a four-year growth plan as part of its annual report to the
    38  governor and legislature pursuant to section one hundred  sixty-four  of
    39  this chapter[.];
    40    (e)  on  January first of each year report to the governor, the tempo-
    41  rary president of the senate, the speaker of the assembly, the  minority
    42  leaders  of  the  senate  and  the assembly, and the chairpersons of the
    43  senate finance and assembly ways and means  committees  on  the  [level]
    44  actual  versus  projected  levels  of  minority and women-owned business
    45  enterprises participating in each agency's contracts  for  goods  [and],
    46  services  and  construction,  including but not limited to the number of
    47  state contracts awarded to certified minority-owned or women-owned busi-
    48  ness enterprises, the maximum dollar amount obligated  pursuant  to  all
    49  those  contracts,  and  the total expenditures made pursuant to all such
    50  contracts, and on activities of the office and effort by each  contract-
    51  ing  agency  to  promote employment of minority group members and women,
    52  and to promote and increase participation by certified  businesses  with
    53  respect  to  state  contracts  and  subcontracts so as to facilitate the
    54  award of a fair share of state contracts to such businesses.  The  comp-
    55  troller  shall  assist  the  division  in  collecting information on the
    56  participation of certified business for each  contracting  agency.  Such
        A. 2321--A                          3

     1  report  may  recommend  new  activities  and  programs to effectuate the
     2  purposes of this article;
     3    (e-1)  the  director  shall  list  in the division's annual report the
     4  names of non-compliant agencies and the extent of their noncompliance in
     5  submitting its quarterly minority and  women-owned  business  enterprise
     6  utilization reports; and, shall implement a master list of all the state
     7  agencies  required to file quarterly compliance reports and shall attach
     8  such list to the division's annual report;
     9    (f) to prepare and update, [no less than annually,] quarterly a direc-
    10  tory of certified minority and women-owned  business  enterprises  which
    11  shall,  wherever  practicable,  be  divided  into  categories  of labor,
    12  services, supplies, equipment,  materials  and  recognized  construction
    13  trades  and  which  shall indicate areas or locations of the state where
    14  such enterprises are available to perform  services,  and  to  use  this
    15  information  to  create an internet based, centralized state registry to
    16  enable appropriate state certified  minority  and  women-owned  business
    17  enterprises to access contract and subcontract opportunities;
    18    (g)  to  appoint independent hearing officers who by contract or terms
    19  of employment shall  preside  over  adjudicatory  hearings  pursuant  to
    20  section  three  hundred  fourteen of this article for the office and who
    21  are assigned no other work by the office;
    22    (h) notwithstanding the provisions of section two  hundred  ninety-six
    23  of  this  chapter,  to  file  a  complaint pursuant to the provisions of
    24  section two hundred ninety-seven of this chapter where the director  has
    25  knowledge  that  a  contractor may have violated the provisions of para-
    26  graph (a), (b) or (c) of subdivision one of section two hundred  ninety-
    27  six  of  this  chapter  where  such  violation is unrelated, separate or
    28  distinct from the state contract as expressed by its terms;
    29    (i) to streamline the state certification process  to  accept  federal
    30  and municipal corporation certifications;
    31    (j)  to  make  publicly available records of all waivers of compliance
    32  reported pursuant to paragraph (b) of subdivision six of  section  three
    33  hundred thirteen of this article on the division's website; and
    34    (k)  to  work in conjunction with the industrial commissioner pursuant
    35  to paragraph (j) of subdivision one of section eight hundred  eleven  of
    36  the  labor  law  to  assist  contractors  in  identifying minority group
    37  members and women who are  participating  in  apprenticeship  agreements
    38  under article twenty-three of the labor law.
    39    4.  The director shall provide assistance to, and facilitate access to
    40  programs serving certified businesses as well as  applicants  to  ensure
    41  that  such businesses benefit, as needed, from technical, managerial and
    42  financial, and general business assistance; training; marketing;  organ-
    43  ization  and personnel skill development; project management assistance;
    44  technology assistance; bond  and  insurance  education  assistance;  and
    45  other  business  development  assistance.  The director shall maintain a
    46  toll-free number at the department of economic development to be used to
    47  answer questions concerning the MWBE certification process. In addition,
    48  the director [may] shall, either independently or  in  conjunction  with
    49  other state agencies:
    50    (a)  develop  a  clearinghouse of information on programs and services
    51  provided by entities that may assist such businesses;
    52    (b) review bonding and paperwork requirements imposed  by  contracting
    53  agencies that may unnecessarily impede the ability of such businesses to
    54  compete; [and]
    55    (c)  seek to maximize utilization by minority and women-owned business
    56  enterprises of available federal resources including but not limited  to
        A. 2321--A                          4

     1  federal grants, loans, loan guarantees, surety bonding guarantees, tech-
     2  nical  assistance,  and programs and services of the federal small busi-
     3  ness administration[.];
     4    (d)  conduct  outreach events, training workshops, seminars, and other
     5  such educational programs throughout the state, including  all  regional
     6  offices,  to  state  agencies, external stakeholders, and the public, to
     7  promote awareness and utilization of minority and  women-owned  business
     8  enterprises; and
     9    (e) identify and establish mentorship opportunities and other business
    10  development  programs  to increase capacity and better prepare MWBEs for
    11  bidding on contracts with state agencies upon successful  completion  of
    12  the  mentorship  opportunity.  Such  mentorship  opportunities  shall be
    13  intended to ensure that mentor and  mentee  are  connected  based  on  a
    14  commercially useful function.
    15    §  2.  Subdivision  5 of section 312 of the executive law, as added by
    16  chapter 261 of the laws of 1988, is amended to read as follows:
    17    5. The director shall promulgate rules and regulations to ensure  that
    18  contractors  and subcontractors undertake programs of affirmative action
    19  and equal employment opportunity as required by this section. Such rules
    20  and regulations as they pertain to any particular agency shall be devel-
    21  oped after consultation with contracting agencies. Such rules and  regu-
    22  lations  [may]  shall require a contractor, after notice in a bid solic-
    23  itation, to submit an equal employment opportunity  program  [after  bid
    24  opening  and  prior  to  the award of any contract] at the time bids are
    25  submitted, and [may] shall require the contractor  or  subcontractor  to
    26  submit  compliance  reports  relating to the contractor's or subcontrac-
    27  tor's operation and implementation of any equal  employment  opportunity
    28  program in effect as of the date the contract is executed. The contract-
    29  ing  agency [may recommend to the director that] shall have the right to
    30  recommend that the director take appropriate  action  according  to  the
    31  procedures  set  forth  in section three hundred sixteen of this article
    32  against the contractor for noncompliance with the requirements  of  this
    33  section.  The  contracting  agency  shall  be responsible for monitoring
    34  compliance with this section.
    35    § 3. Subdivisions 2-a, 3 and paragraph (a) of subdivision 5 of section
    36  313 of the executive law, as amended by chapter 96 of the laws of  2019,
    37  are amended to read as follows:
    38    2-a.  The  director  shall  promulgate rules and regulations that will
    39  accomplish the following:
    40    (a) provide for the certification and decertification of minority  and
    41  women-owned business enterprises for all agencies through a single proc-
    42  ess that meets applicable requirements;
    43    (b) require that each contract solicitation document accompanying each
    44  solicitation  set  forth the expected degree of minority and women-owned
    45  business enterprise participation based, in part, on:
    46    (i) the potential subcontract opportunities  available  in  the  prime
    47  procurement contract;
    48    (ii)  the  availability,  as  contained within the study, of certified
    49  minority and women-owned business enterprises to  respond  competitively
    50  to  the  potential  subcontract  opportunities as reflected in the divi-
    51  sion's directory of certified minority and women-owned  business  enter-
    52  prises; and
    53    (iii) the findings of the disparity study;
    54    (c)  require  that  each  agency  provide  a current list of certified
    55  minority business enterprises to each prospective contractor  or  direct
        A. 2321--A                          5

     1  them  to  the division's directory of certified minority and women-owned
     2  business enterprises for such purpose;
     3    (d)  allow  a  contractor that is a certified minority-owned or women-
     4  owned business enterprise to use the work it performs to  meet  require-
     5  ments for use of certified minority-owned or women-owned business enter-
     6  prises as subcontractors;
     7    (e)  establish  criteria  for  agencies to credit the participation of
     8  minority and women-owned business enterprises towards the achievement of
     9  the minority and women-owned business enterprise participation goals  on
    10  a  state  contract based on the commercially useful function provided by
    11  each minority and women-owned business enterprise on the contract;
    12    (f) provide for joint ventures, which a bidder may count toward  meet-
    13  ing its minority and women-owned business enterprise participation;
    14    (g)  consistent  with  subdivision  six  of  this section, provide for
    15  circumstances under  which  an  agency  may  waive  obligations  of  the
    16  contractor  relating  to  minority  and  women-owned business enterprise
    17  participation;
    18    (h) require that an agency verify that minority and women-owned  busi-
    19  ness  enterprises  listed in a successful bid are actually participating
    20  to the extent listed in the project for which the bid was submitted;
    21    (i) provide for the collection of  statistical  data  by  each  agency
    22  concerning  actual  minority and women-owned business enterprise partic-
    23  ipation;
    24    (j) require each agency to consult the most  current  disparity  study
    25  when  calculating  agency-wide and contract specific participation goals
    26  pursuant to this article; [and]
    27    (k)  encourage  joint  ventures,  partnerships,   and   mentor-protege
    28  relationships as defined in section one hundred forty-seven of the state
    29  finance  law,  between  prime  contractors  and minority and women-owned
    30  business enterprises; and
    31    Such rules shall set forth the maximum personal net worth of a minori-
    32  ty group member or woman who may be relied upon to certify a business as
    33  a minority-owned business enterprise or women-owned business enterprise,
    34  and may establish different maximum levels of  personal  net  worth  for
    35  minority  group  members  and women on an industry-by-industry basis for
    36  such industries as the director shall determine. Such regulations relat-
    37  ing to the classification of the industry-by-industry personal net worth
    38  thresholds above the fifteen million dollar threshold shall consider the
    39  personal net worth of the owners of  both  certified  and  non-certified
    40  businesses,  including but not limited to, prime contractors and subcon-
    41  tractors, as well as any such other factors  needed  to  establish  such
    42  thresholds. The provisions of the regulations pertaining to personal net
    43  worth  shall,  to the extent practicable, be implemented by June thirti-
    44  eth, two thousand twenty and shall consider  adjustments  for  inflation
    45  annually on January first of the previous year according to the consumer
    46  price index.
    47    3.  Solely for the purpose of providing the opportunity for meaningful
    48  participation by  certified  businesses  in  the  performance  of  state
    49  contracts  as  provided  in  this section, state contracts shall include
    50  leases of real property by a state agency to a lessee where:  the  terms
    51  of  such  leases  provide for the construction, demolition, replacement,
    52  major repair or renovation of real property and improvements thereon  by
    53  such lessee; and the cost of such construction, demolition, replacement,
    54  major  repair  or  renovation  of real property and improvements thereon
    55  shall exceed the sum of one hundred thousand  dollars.  Reports  to  the
    56  director pursuant to section three hundred fifteen of this article shall
        A. 2321--A                          6

     1  include activities with respect to all such state contracts. Contracting
     2  agencies  shall  include or require to be included with respect to state
     3  contracts for the acquisition,  construction,  demolition,  replacement,
     4  major  repair  or  renovation of real property and improvements thereon,
     5  such provisions as [may] shall be necessary to effectuate the provisions
     6  of this section in every bid specification and state  contract,  includ-
     7  ing,  but not limited to: (a) provisions requiring contractors to make a
     8  good faith effort to solicit active participation by enterprises identi-
     9  fied in the directory of certified businesses; (b) requiring the parties
    10  to agree as a condition of entering into such contract, to be  bound  by
    11  the provisions of section three hundred sixteen of this article; and (c)
    12  requiring  the  contractor  to include the provisions set forth in para-
    13  graphs (a) and (b) of this subdivision in every subcontract in a  manner
    14  that  the  provisions will be binding upon each subcontractor as to work
    15  in connection with  such  contract.  Provided,  however,  that  no  such
    16  provisions  shall  be  binding upon contractors or subcontractors in the
    17  performance of work or the provision of  services  that  are  unrelated,
    18  separate  or distinct from the state contract as expressed by its terms,
    19  and nothing  in  this  section  shall  authorize  the  director  or  any
    20  contracting  agency to impose any requirement on a contractor or subcon-
    21  tractor except with respect to a state contract.
    22    (a) Contracting agencies shall administer the  rules  and  regulations
    23  promulgated  by the director in a good faith effort to achieve the maxi-
    24  mum feasible participation by minority and women owned  business  enter-
    25  prises  adopted  pursuant  to  this  article  and the regulations of the
    26  director. Such rules and regulations:  shall  require  a  contractor  to
    27  submit  a  utilization plan [after bids are opened] at the time bids are
    28  submitted, when bids are required, [but prior to the award  of  a  state
    29  contract];  shall  require the contracting agency to review the utiliza-
    30  tion plan submitted by the contractor and to post the  utilization  plan
    31  and any waivers of compliance issued pursuant to subdivision six of this
    32  section  on  the  website  of  the contracting agency; shall require the
    33  contracting agency to notify the contractor in writing within  a  period
    34  of  time  specified  by the director as to any deficiencies contained in
    35  the contractor's utilization plan; shall require remedy thereof within a
    36  period of time specified by the director; shall require  the  contractor
    37  to submit [periodic] quarterly compliance reports relating to the opera-
    38  tion  and  implementation  of  any utilization plan; shall not allow any
    39  automatic waivers but shall allow a contractor to apply for a partial or
    40  total waiver of the minority and women-owned business enterprise partic-
    41  ipation requirements pursuant to subdivisions  six  and  seven  of  this
    42  section;  shall allow a contractor to file a complaint with the director
    43  pursuant to subdivision eight of this section in the event a contracting
    44  agency has failed or refused to issue  a  waiver  of  the  minority  and
    45  women-owned business enterprise participation requirements or has denied
    46  such  request for a waiver; and shall allow a contracting agency to file
    47  a complaint with the director  pursuant  to  subdivision  nine  of  this
    48  section  in  the  event  a contractor is failing or has failed to comply
    49  with the minority  and  women-owned  business  enterprise  participation
    50  requirements  set  forth  in the state contract where no waiver has been
    51  granted.
    52    § 4. Subdivisions 1 and 3 of section 315  of  the  executive  law,  as
    53  amended  by  chapter  96  of  the  laws  of 2019, are amended to read as
    54  follows:
    55    1. Each contracting agency shall be responsible for  monitoring  state
    56  contracts under its jurisdiction, and recommending matters to the office
        A. 2321--A                          7

     1  respecting  non-compliance  with  the provisions of this article so that
     2  the office [may] shall take such action as [is  appropriate]  stated  in
     3  subdivision three of section three hundred sixteen of this article. Each
     4  contracting  agency  shall have the right to recommend that the director
     5  impose a sanction, penalty, or fine for  three  or  more  violations  of
     6  subdivision  one  of  section  three  hundred of this article, to ensure
     7  compliance with the provisions of this  article,  the  rules  and  regu-
     8  lations  of the director issued hereunder and the contractual provisions
     9  required pursuant to this article. All contracting agencies shall comply
    10  with the rules and regulations of the office and are directed to cooper-
    11  ate with the office and to furnish to the office  such  information  and
    12  assistance  as may be required in the performance of its functions under
    13  this article.
    14    3. [Each contracting agency shall report to the director with  respect
    15  to activities undertaken to promote employment of minority group members
    16  and women and promote and increase participation by certified businesses
    17  with  respect to state contracts and subcontracts. Such reports shall be
    18  submitted no later than May fifteenth of every year  and  shall  include
    19  such  information  as is necessary for the director to determine whether
    20  the contracting agency and any contractor to the contracting agency have
    21  complied with the purposes of this article, including,  without  limita-
    22  tion,  a  summary of all waivers of the requirements of subdivisions six
    23  and seven of section three hundred thirteen of this article  allowed  by
    24  the  contracting agency during the period covered by the report, includ-
    25  ing a description of the basis of the waiver request and  the  rationale
    26  for  granting  any  such  waiver and any instances in which the contract
    27  agency has deemed a contractor to have committed a violation pursuant to
    28  section three hundred sixteen of this article and such other information
    29  as the director shall require. Each agency shall also  include  in  such
    30  annual  report whether or not it has been required to prepare a remedial
    31  plan, and, if so, the plan and  the  extent  to  which  the  agency  has
    32  complied  with  each  element  of the plan.] (a) Each contracting agency
    33  shall prepare a quarterly report and submit copies to  the  commissioner
    34  of  economic  development, the commissioner of general services, and the
    35  director as to the level of minority  and  women-owned  business  enter-
    36  prises  participation  in the awarding of agency contracts for goods and
    37  services, including but not limited to, the number  of  state  contracts
    38  awarded  to  certified minority or women-owned business enterprises; the
    39  maximum dollar amount obligated pursuant  to  such  contracts,  and  the
    40  total  expenditures  made  pursuant to all such contracts; the number of
    41  state contracts awarded upon which  a  waiver  was  granted  from  goals
    42  required by the contracts for business participation by certified minor-
    43  ity  or  women-owned  business enterprises, and the maximum amount obli-
    44  gated pursuant to such contracts; the number of state contracts  awarded
    45  which required goals for employment of minority group members and women;
    46  and  the  number of state contracts awarded for which waivers of employ-
    47  ment goals required by the contracts have been granted;
    48    (b) In addition, each contracting agency shall be responsible for  the
    49  cost  of  an  independent  audit  resulting  from  the agency's repeated
    50  violations of this section.
    51    (c) Within thirty days after  completion,  a  copy  of  the  quarterly
    52  minority and women-owned business enterprise report shall be transmitted
    53  to the commissioner of economic development, the commissioner of general
    54  services, and the director. A contracting agency, which has not let more
    55  than two million dollars in service and/or construction contracts within
    56  the applicable period may apply to the commissioner of economic develop-
        A. 2321--A                          8

     1  ment,  and the director for a waiver of the required annual report.  The
     2  waiver application shall be made on such form  as  the  commissioner  of
     3  economic development and the director may prescribe.
     4    (d)  If  a  contracting  agency  shall  fail  to file or substantially
     5  complete, as determined by the commissioner of economic development  and
     6  the  director,  the  report required by this section, the director shall
     7  provide notice to the contracting agency. The  notice  shall  state  the
     8  following:
     9    (i)  that  the  failure to file a report as required is a violation of
    10  this section, or in case of an insufficient report, the manner in  which
    11  the report submitted is deficient;
    12    (ii)  that  the contracting agency has thirty days to comply with this
    13  section or provide an adequate written explanation to  the  commissioner
    14  of  economic  development,  the commissioner of general services and the
    15  director of the  contracting  agency's  reasons  for  the  inability  to
    16  comply; and
    17    (iii)  that  the  contracting  agency's  continued  failure to provide
    18  either the required report or an adequate explanation will result in  an
    19  independent  audit of the contracting agency, the cost of which shall be
    20  borne by the contracting agency.
    21    § 5. Section 316 of the executive law, as amended by  chapter  175  of
    22  the laws of 2010, is amended to read as follows:
    23    §  316.  [Enforcement]  Violations and enforcement.   1. It shall be a
    24  violation for any person or entity to:
    25    (a) intentionally use or acquire an MWBE name through deceit or  other
    26  dishonest means in order to negotiate a lower bid from a non-MWBE.
    27    (b)  submit  to  the  department of economic development, documents or
    28  other material as evidence of a good faith effort  to  comply  with  the
    29  provisions  of  this  article  without, in fact, having entered into any
    30  contract, agreement, subcontract, or sub-agreement with an MWBE for  the
    31  use  or  purchase of such business enterprise's goods or services in the
    32  performance of the awarded state contract.
    33    (c) fail to provide an  MWBE  with  sufficient  information  or  other
    34  required  supporting  documentation  in  order for the MWBE to prepare a
    35  proper bid.
    36    2. Upon receipt by the director of a complaint by a contracting agency
    37  that a contractor has violated the provisions of a state contract  which
    38  have been included to comply with the provisions of this article or of a
    39  contractor that a contracting agency has violated such provisions or has
    40  failed  or  refused  to  issue  a  waiver where one has been applied for
    41  pursuant to subdivision six of section three hundred  thirteen  of  this
    42  article  or  has  denied such application, the director shall attempt to
    43  resolve the matter giving rise to such complaint. If efforts to  resolve
    44  such  matter  to  the  satisfaction of all parties are unsuccessful, the
    45  director shall refer the matter, within thirty days of  the  receipt  of
    46  the  complaint,  to  the division's hearing officers. Upon conclusion of
    47  the administrative hearing, the hearing  officer  shall  submit  to  the
    48  director  his  or  her  decision  regarding the alleged violation of the
    49  contract and recommendations  regarding  the  imposition  of  sanctions,
    50  fines  or  penalties.  The  director,  within ten days of receipt of the
    51  decision, shall file a determination of such matter and  shall  cause  a
    52  copy  of  such  determination  along  with  a copy of this article to be
    53  served upon the contractor by personal  service  or  by  certified  mail
    54  return  receipt  requested. The decision of the hearing officer shall be
    55  final and may only be vacated or modified as provided in article  seven-
    56  ty-eight  of  the  civil practice law and rules upon an application made
        A. 2321--A                          9

     1  within the time provided by  such  article.  The  determination  of  the
     2  director as to the imposition of any fines, sanctions or penalties shall
     3  be  reviewable  pursuant  to article seventy-eight of the civil practice
     4  law and rules. The penalties imposed for any violation which is premised
     5  upon  either  a  fraudulent  or  intentional  misrepresentation  by  the
     6  contractor or the contractor's willful and intentional disregard of  the
     7  minority  and  women-owned  participation  requirement  included  in the
     8  contract may include a determination that the contractor shall be ineli-
     9  gible to submit a bid to any contracting agency or be awarded  any  such
    10  contract  for a period not to exceed one year following the final deter-
    11  mination; provided however, if a contractor has previously  been  deter-
    12  mined  to  be  ineligible  to submit a bid pursuant to this section, the
    13  penalties imposed for any subsequent violation, if such violation occurs
    14  within five years of the first violation, may  include  a  determination
    15  that the contractor shall be ineligible to submit a bid to any contract-
    16  ing  agency  or  be awarded any such contract for a period not to exceed
    17  five years following the final determination. The division  of  minority
    18  and  women's  business  development shall maintain a website listing all
    19  contractors that have been deemed ineligible to submit a bid pursuant to
    20  this section and the date after which each contractor shall  once  again
    21  become eligible to submit bids.
    22    3.    The  director  shall  impose a sanction, penalty, or fine on any
    23  individual or entity that has three or more violations of  this  article
    24  within five years. Such fine shall be paid by such individual or entity.
    25  Such  fine shall be remitted and deposited into a fund, to be managed by
    26  the commissioner of economic development.  Such funds shall be  used  to
    27  subsidize  the  facilitation  of  the  provisions of this article. Other
    28  sanctions shall include barring such entity or individual from contract-
    29  ing with such agency for a period not to exceed five years.
    30    § 6. Subdivision 1 of section 137 of the state finance law,  as  sepa-
    31  rately amended by section 17 of part MM of chapter 57 and by chapter 619
    32  of the laws of 2008, is amended to read as follows:
    33    1. In addition to other bond or bonds, if any, required by law for the
    34  completion  of  a  work specified in a contract for the prosecution of a
    35  public improvement for the state of New York a municipal corporation,  a
    36  public benefit corporation or a commission appointed pursuant to law, or
    37  in the absence of any such requirement, the comptroller may or the other
    38  appropriate  official, respectively, shall nevertheless require prior to
    39  the approval of any such contract a bond guaranteeing prompt payment  of
    40  moneys  due to all persons furnishing labor or materials to the contrac-
    41  tor or any subcontractors in the prosecution of the work provided for in
    42  such contract. Whenever a municipal corporation issues a permit  subject
    43  to  compliance  with  section  two hundred twenty of the labor law, such
    44  permittee or its contractor or subcontractors furnishing  workers  shall
    45  post a payment bond subject to this section. Provided, however, that all
    46  performance  bonds  and payment bonds may, at the discretion of the head
    47  of the state agency, public benefit corporation or commission, or his or
    48  her designee, be dispensed with for the completion of a  work  specified
    49  in  a contract for the prosecution of a public improvement for the state
    50  of New York for which bids are solicited where the aggregate  amount  of
    51  the  contract  is  under one hundred fifty thousand dollars and provided
    52  further, that in a case where the contract is not subject to the  multi-
    53  ple  contract  award  requirements of section one hundred thirty-five of
    54  this article, such requirements may be dispensed with where the head  of
    55  the  state  agency, public benefit corporation or commission finds it to
    56  be in the public interest and where the aggregate amount of the contract
        A. 2321--A                         10

     1  awarded or to be awarded is less than two hundred thousand dollars.  The
     2  head  of  the state agency, public benefit corporation or commission, or
     3  his or her designee, shall adjust the aggregate contract amounts  listed
     4  in  this subdivision every year to account for increases in the costs of
     5  construction. Advertisements for bids shall provide information  on  the
     6  requirements  for,  or  dispensation  of, performance and payment bonds.
     7  Provided further, that in a case where a performance or payment bond  is
     8  dispensed  with,  twenty  per  centum may be retained from each progress
     9  payment or estimate until the entire contract work  has  been  completed
    10  and accepted, at which time the head of the state agency, public benefit
    11  corporation  or commission shall, pending the payment of the final esti-
    12  mate, pay not to exceed seventy-five per centum of  the  amount  of  the
    13  retained percentage.
    14    §  7.  Subdivision  4  of  section  139-f of the state finance law, as
    15  amended by chapter 83 of the  laws  of  1995,  is  amended  to  read  as
    16  follows:
    17    4.  Notwithstanding  any other provision of this section or other law,
    18  requirements for the furnishing of a performance bond or a payment  bond
    19  may  be dispensed with at the discretion of the head of the state agency
    20  or corporation, or his or her designee, where  the  public  owner  is  a
    21  state  agency  or  corporation  described  in  subdivision one-a of this
    22  section and the aggregate amount  of  the  contract  awarded  or  to  be
    23  awarded  is  under  fifty  thousand  dollars  and,  in  a case where the
    24  contract is not subject to the multiple contract award  requirements  of
    25  section  one  hundred thirty-five of this article, such requirements may
    26  be dispensed with where the head of  the  state  agency  or  corporation
    27  finds  it to be in the public interest and where the aggregate amount of
    28  the contract awarded or to be awarded is under [two] three hundred thou-
    29  sand dollars.  The head of the state agency, public benefit  corporation
    30  or  commission,  or  his  or  her  designee,  shall adjust the aggregate
    31  contract amounts listed in this subdivision every year  to  account  for
    32  increases  in  the  costs of construction. Advertisements for bids shall
    33  provide  information  on  the  requirements  for,  or  dispensation  of,
    34  performance  and payment bonds. Provided further, that in a case where a
    35  performance or payment bond is dispensed with, twenty per centum may  be
    36  retained  from  each  progress  payment  or  estimate  until  the entire
    37  contract work has been completed and accepted, at which time the head of
    38  the state agency or corporation shall, pending the payment of the  final
    39  estimate, pay not to exceed seventy-five per centum of the amount of the
    40  retained percentage.
    41    §  8. The opening paragraph of section 139-g of the state finance law,
    42  as amended by chapter 636 of the laws of 2003, is  amended  to  read  as
    43  follows:
    44    In  every  state  agency,  department and authority which has let more
    45  than two million dollars in service and construction contracts and state
    46  assisted project contracts in the prior fiscal year, the chief executive
    47  officer of that agency, department or authority shall, with  respect  to
    48  those  contracts  and state assisted project contracts let by his or her
    49  agency, department or authority:
    50    § 9. The opening paragraph of subdivision (b) of section 139-g of  the
    51  state  finance  law,  as  amended by chapter 636 of the laws of 2003, is
    52  amended to read as follows:
    53    identify all small-business and  certified  women  and  minority-owned
    54  business  concerns which, in the judgment of the chief executive officer
    55  of that agency, department or authority, can bid on those contracts  and
    56  state  assisted  project contracts which are usually and customarily let
        A. 2321--A                         11

     1  by that agency, department or authority,  or  in  which  that  authority
     2  provides  a  grant  or  loan  or tax exempt financing, with a reasonable
     3  expectation of success. Such chief executive officers  shall  carry  out
     4  the provisions of this subdivision:
     5    §  10.   Section 139-g of the state finance law is amended by adding a
     6  new subdivision (e) to read as follows:
     7    (e) For the purposes of this section, the following words  shall  have
     8  the following meanings:
     9    (i) "State assisted project contract" shall mean any written agreement
    10  arising  out  of  a  state  assisted  housing  project or state assisted
    11  economic development project or state assisted higher education  project
    12  or  state  assisted  hospital or health care facility project, for which
    13  the total project cost exceeds two million dollars  and  for  which  the
    14  project  owner is committed to spend or does expend funds for the acqui-
    15  sition, construction, demolition, replacement, major  repair,  or  reno-
    16  vation of real property and improvements thereon for such project.
    17    (ii)  "State assisted housing project" shall mean those projects which
    18  receive from the  New  York  state  housing  finance  agency  tax-exempt
    19  financing for all or part of the total project cost.
    20    (iii)  "State  assisted economic development project" shall mean those
    21  projects which receive from the New York foundation of science technolo-
    22  gy and innovation, or the urban development corporation and its  subsid-
    23  iaries  a  grant  or loan or tax-exempt financing for all or part of the
    24  total project cost.
    25    (iv) "State  assisted  higher  education  project"  shall  mean  those
    26  projects  which receive from the dormitory authority of the state of New
    27  York a grant or loan or tax-exempt financing for  all  or  part  of  the
    28  total project cost.
    29    (v)  "State  assisted  hospital or health care facility project" shall
    30  mean those projects which receive from the dormitory  authority  of  the
    31  state  of  New  York  a grant or loan or tax-exempt financing for all or
    32  part of the total project cost.
    33    § 11. This act shall take effect immediately,  provided  however,  the
    34  amendments  to  article  15-A of the executive law made by sections one,
    35  two, three, four and five of this act shall not affect the expiration of
    36  such article and shall be deemed repealed therewith.