N.Y. Education Law § 458: Letting of construction contracts

§ 458. Letting of construction contracts. 1. Any contract let by the

fund or by any letting agency on behalf of the fund for the

construction, reconstruction, rehabilitation or improvement of a

combined occupancy structure or of the school portion thereof, shall be

in conformity with the provisions of section one hundred one of the

general municipal law.

2. Except as otherwise provided in section two hundred twenty-two of

the labor law, every contract, lease or other agreement entered into by

or on behalf of the fund for the acquisition, lease, construction,

reconstruction, rehabilitation or improvement of the school portion of

the work in any combined occupancy structure shall contain a provision

that, when the entire cost of any such contemplated construction,

reconstruction, rehabilitation or improvement for the school portion of

the work shall exceed three million dollars in the counties of the

Bronx, Kings, New York, Queens, and Richmond; one million five hundred

thousand dollars in the counties of Nassau, Suffolk and Westchester; and

five hundred thousand dollars in all other counties within the state,

separate specifications shall be prepared for the following three

subdivisions of the work on the school portion to be performed:

a. Plumbing and gas fitting;

b. Steam heating, hot water heating, ventilating and air conditioning

apparatus; and

c. Electric wiring and standard illuminating fixtures.

Such specifications shall be drawn so as to permit the letting of

separate and independent contracts for each of the above three

subdivisions of work. Within the above three subdivisions of work, any

equipment, apparatus and/or installations which shall be designed to

service the entire combined occupancy structure shall be included within

the school portion of the work or let as separate and independent

contracts even if physically located within the non-school portion of

the work. Except as otherwise provided by the public housing law, the

provisions of which shall apply when the developer is the New York city

housing authority, every developer or general contractor undertaking the

construction, reconstruction, rehabilitation or improvement of any such

combined occupancy structure pursuant to or in furtherance of the

provisions of this article shall let separate contracts to the lowest

responsible bidder for the three subdivisions of the above specified

work to persons, firms or corporations approved by the chairman of the

fund as being qualified, responsible and reliable bidders engaged in

these classes of work. All such qualified bidders engaged in the above

specified work shall be entitled to bid and to receive, upon request, a

copy of the plans and specifications. All such bids shall be submitted

to the fund and shall be opened publicly at a stated time and place.

2-a. Each bidder on a public work contract, where the preparation of

separate specifications is not required, shall submit with its bid a

separate sealed list that names each subcontractor that the bidder will

use to perform work on the contract, and the agreed-upon amount to be

paid to each, for: a. plumbing and gas fitting, b. steam heating, hot

water heating, ventilating and air conditioning apparatus and c.

electric wiring and standard illuminating fixtures. After the low bid is

announced, the sealed list of subcontractors submitted with such low bid

shall be opened and the names of such subcontractors shall be announced,

and thereafter any change of subcontractor or agreed-upon amount to be

paid to each shall require the approval of the public owner, upon a

showing presented to the public owner of legitimate construction need

for such change, which shall be open to public inspection. Legitimate

construction need shall include, but not be limited to, a change in

project specifications, a change in construction material costs, a

change to subcontractor status as determined pursuant to paragraph (e)

of subdivision two of section two hundred twenty-two of the labor law,

or the subcontractor has become otherwise unwilling, unable or

unavailable to perform the subcontract. The sealed lists of

subcontractors submitted by all other bidders shall be returned to them

unopened after the contract award.

3. a. In addition to other bond or bonds, if any, required by law for

the completion of the school portion of a combined occupancy structure,

or in the absence of any such requirement, the fund shall nevertheless

require, prior to the approval of any lease or other agreement providing

for the construction, reconstruction, rehabilitation or improvement of

any combined occupancy structure, that the developer, if other than the

New York city housing authority, or general contractor, furnish a bond

guaranteeing prompt payment of moneys due to all persons furnishing

labor or materials to or for the person furnishing said bond or to his

subcontractors in the prosecution of the entire work provided for in

such lease or other agreement. Whenever the developer is the New York

city housing authority, it shall require each of its contractors to

furnish such bonds to said authority and fund with respect to the work

to be performed and materials supplied by such contractor, and no

separate or other payment bond shall be required to be furnished to the

fund. In those instances where the developer or general contractor is an

agency of the state or a public-benefit corporation created by an act of

the state legislature and in instances where said developer or general

contractor or the guarantor of payment of the construction costs of the

non-school portion of the combined "occupancy structure" is a public

utility corporation or a bank, trust company or savings bank as defined

in section two of the banking law, or a national bank having its office

and principal place of business in this state, or a subsidiary of such a

bank or trust company of which at least eighty (80%) percent of whose

stock is owned by it, the said developer or general contractor shall

only be required to furnish said payment bond with respect to the school

portion of the combined occupancy structure. In such instances, the said

payment bond shall not be required by the fund with respect to the

non-school portion of the combined occupancy structure, but, in lieu

thereof, such fund shall require said agency, public benefit

corporation, public utility corporation or banking institution, as the

case may be to guarantee payment of all construction costs with respect

to the non-school portion of the combined occupancy structure.

b. A copy of such payment bond shall be kept in the office of the

chairman of the fund and a copy shall also be kept in the office of the

board of education; such copies shall be open to public inspection.

c. Every person who has furnished labor or material, to or for the

developer or contractor furnishing such payment bond or to his or her

subcontractors in the prosecution of the work provided for in the lease

or other agreement for which said bond is furnished and who has not been

paid in full therefor before the expiration of a period of ninety days

after the day on which the last of the labor was performed or material

was furnished by him or her for which the claim is made, shall have the

right to sue on such payment bond in his or her own name for the amount,

or the balance thereof, unpaid at the time of commencement of the

action; provided, however, that a person having a direct contractual

relationship with a subcontractor of the developer or contractor

furnishing the payment bond but no contractual relationship express or

implied with such developer or contractor shall not have a right of

action upon the bond unless he or she shall have given written notice to

such developer or contractor furnishing the bond within ninety days from

the date on which the last of the labor was performed or the last of the

material was furnished, for which his or her claim is made, stating with

substantial accuracy the amount claimed and the name of the party to

whom the material was furnished or for whom the labor was performed. The

notice shall be served by delivering the same personally to the

developer or contractor furnishing said bond or by mailing the same by

registered mail, postage prepaid, in an envelope addressed to such

developer or contractor at any place where he maintains an office or

conducts his or her business or at his or her residence.