N.Y. Public Authorities Law § 2879: Procurement contracts

§ 2879. Procurement contracts. 1. Every public authority and public

benefit corporation, a majority of the members of which consist of

persons either appointed by the governor or who serve as members by

virtue of holding a civil office of the state, or a combination thereof,

(such entities to be hereinafter in this section referred to as

"corporation") shall adopt by resolution comprehensive guidelines which

detail the corporation's operative policy and instructions regarding the

use, awarding, monitoring and reporting of procurement contracts.

Guidelines approved by the corporation shall be annually reviewed and

approved by the corporation.

2. For purposes of this section, procurement contracts shall mean any

written agreement for the acquisition of goods or services of any kind,

in the actual or estimated amount of five thousand dollars or more.

3. The guidelines approved by the corporation shall include, but not

be limited to the following:

(a) A description of the types of goods purchased, and for procurement

contracts for services, a description of those areas of responsibility

and oversight requiring the use of personal services and the reasons for

the use of personal services in such areas.

(b) Requirements regarding the selection of contractors, which shall

include provisions:

(i) for the selection of such contractors on a competitive basis, and

provisions relating to the circumstances under which the board may by

resolution waive competition, including, notwithstanding any other

provision of law requiring competition, the purchase of goods or

services from: (A) small business concerns, or sellers of goods or

technology that are recycled or remanufactured, or, for corporations not

defined as a state authority in section three hundred ten of the

executive law, those certified as minority or women-owned business

enterprises in an amount not to exceed five hundred thousand dollars

without a formal competitive process, and (B) for corporations defined

as a state authority in section three hundred ten of the executive law

those certified as minority or women-owned business enterprises and

service-disabled veteran-owned business enterprises for any state

authority as defined in section forty of the veterans' services law, in

an amount not to exceed one million five hundred thousand dollars

without a formal competitive process;

(ii) describing when the award of procurement contracts shall require

approval of the board by resolution, provided that any contract

involving services to be rendered over a period in excess of one year

shall require the approval of the board by resolution and an annual

review of the contract by the board;

(iii) setting forth responsibilities of contractors;

(iv) as used in this subparagraph, the term "professional firm" shall

be defined as any individual or sole proprietorship, partnership,

corporation, association, or other legal entity permitted by law to

practice the professions of architecture, engineering or surveying.

The corporation shall not refuse to negotiate with a professional firm

solely because the ratio of the "allowable indirect costs" to direct

labor costs of the professional firm or the hourly labor rate in any

labor category of the professional firm exceeds a limitation generally

set by the corporation in the determination of the reasonableness of the

estimated cost of services to be rendered by the professional firm, but

rather the corporation should also consider the reasonableness of cost

based on the total estimated cost of the service of the professional

firm which should include, among other things, all the direct labor

costs of the professional firm for such services plus all "allowable

indirect costs," other direct costs, and negotiated profit of the

professional firm. "Allowable indirect costs" of a professional firm are

defined as those costs generally associated with overhead which cannot

be specifically identified with a single project or contract and are

considered reasonable and allowable under specific state contract or

allowability limits.

(c) An identification of those areas or types of contracts for which

minority or women-owned business enterprises may best bid so as to

promote and assist participation by such enterprises and facilitate a

fair share of the awarding of contracts to such enterprises. For the

purposes of this section, a minority business enterprise means any

business enterprise, including a sole proprietorship, partnership or

corporation that is:

(i) at least fifty-one percent owned by one or more minority group

members or in the case of a publicly-owned business at least fifty-one

percent of the common stock or other voting interests of which is owned

by one or more minority group members;

(ii) an enterprise in which the minority ownership is real,

substantial and continuing;

(iii) an enterprise in which the minority ownership has and exercises

the authority to control independently the day-to-day business decisions

of the enterprise; and

(iv) an enterprise authorized to do business in New York state,

independently owned and operated, and not dominant in its field.

(d) For the purposes of this section, a minority group member means a

United States citizen or permanent resident noncitizen who is and can

demonstrate membership in one of the following groups:

(i) Black persons having origins in any of the Black African racial

groups not of Hispanic origin;

(ii) Hispanic persons of Mexican, Puerto Rican, Dominican, Cuban,

Central or South American of either Indian or Hispanic origin,

regardless of race;

(iii) Asian and Pacific Islander persons having origins in any of the

Far East, Southeast Asia, the Indian sub-continent or the Pacific

Islands; or

(iv) Native American persons having origins in any of the original

peoples of North America.

(e) For the purposes of this section, a women-owned business

enterprise means a business enterprise, including a sole proprietorship,

partnership or corporation which is:

(i) at least fifty-one percent owned by one or more United States

citizens or permanent resident noncitizens who are women or in the case

of a publicly-owned business at least fifty-one percent of the common

stock or other voting interests of which is owned by United States

citizens or permanent resident noncitizens who are women;

(ii) an enterprise in which the ownership interest of women is real,

substantial and continuing;

(iii) an enterprise in which the women ownership has and exercises the

authority to control independently the day-to-day business decisions of

the enterprise; and

(iv) an enterprise authorized to do business in New York state,

independently owned and operated, and not dominant in its field.

(f) Requirements for the designation of one or more senior staff of

the corporation to oversee the corporation's programs established to

promote and assist: (i) participation by certified minority or

women-owned business enterprises in the corporation's procurement

opportunities and facilitation of the award of procurement contracts to

such enterprises; (ii) the utilization of certified minority and

women-owned business enterprises as subcontractors and suppliers by

entities having procurement contracts with the corporation; and (iii)

the utilization of partnerships, joint ventures or other similar

arrangements between certified minority and women-owned business

enterprises and other entities having procurement contracts with the

corporation. Such staff shall be familiar with the procurement of the

types of construction, financial, legal or professional services

utilized by the corporation, report directly to the corporation's

executive director, president or chief executive officer and either

directly or through their designees participate in the procurement

process.

(g) Requirements for providing notice, in addition to any other notice

of procurement opportunities required by law, to professional and other

organizations that serve minority and women-owned business enterprises

providing the types of services procured by the corporation.

(h) Procedures for maintaining lists of qualified certified minority

and women-owned business enterprises, including professional firms that

have expressed an interest in doing business with the corporation and

ensuring that such lists are updated regularly. The corporation shall

also consult the lists of certified minority and women-owned business

enterprises maintained by the department of economic development

pursuant to article fifteen-A of the executive law.

(i) The establishment of appropriate goals for participation by

minority or women-owned business enterprises in procurement contracts

awarded by the corporation and for the utilization of minority and

women-owned enterprises as subcontractors and suppliers by entities

having procurement contracts with the corporation. Statewide numerical

participation target goals shall be established by each authority based

on the findings of the two thousand ten disparity study.

(j) Requirements to conduct procurements in a manner that will enable

the corporation to achieve the maximum feasible portion of the goals

established pursuant to paragraph (i) of this subdivision and that

eliminates barriers to participation by minority and women-owned

business enterprises in the corporation's procurements. Such procurement

requirements shall include the following:

(A) Measures and procedures to ensure that certified businesses shall

be given the opportunity for maximum feasible participation in the

performance of state contracts and to assist in the corporation's

identification of those state contracts for which certified businesses

may best bid to actively and affirmatively promote and assist their

participation in the performance of state contracts so as to facilitate

the corporation's achievement of the maximum feasible portion of the

goals for state contracts to such businesses;

(B) Provisions designating the division of minority and women-owned

business development to certify and decertify minority and women-owned

business enterprises for all corporations through a single process that

meets applicable state and federal requirements;

(C) A requirement that each contract solicitation document

accompanying each solicitation set forth the expected degree of minority

and women-owned business enterprise participation based, in part, on:

I. the potential subcontract opportunities available in the prime

procurement contract; and

II. the availability of certified minority and women-owned business

enterprises to respond competitively to the potential subcontract

opportunities;

(D) A requirement that each corporation provide a current list of

certified minority business enterprises to each prospective contractor;

(E) Provisions relating to joint ventures, under which a bidder may

count toward meeting its minority business enterprise participation

goal, the minority and women-owned business enterprise portion of the

joint venture;

(F) Provisions under which the corporation may waive obligations of

the contractor relating to minority and women-owned business enterprise

participation after a showing of good faith efforts to comply with the

requirements of this act pursuant to the waiver provisions contained in

subdivision six of section three hundred thirteen of the executive law;

(G) A requirement that the corporation verify that minority and

women-owned business enterprises listed in a successful bid are actually

participating to the extent listed in the project for which the bid was

submitted;

(H) In the implementation of this section, the contracting corporation

shall:

I. consider, where practicable, the severability of construction

projects and other bundled contracts;

II. implement a program that will enable the corporation to evaluate

each contract to determine the appropriateness of the goal pursuant to

paragraph (i) of this subdivision;

III. consider compliance with the requirements of any federal law

concerning opportunities for minority and women-owned business

enterprises which effectuates the purpose of this section; and

IV. consult the most recent disparity study pursuant to article

fifteen-A of the executive law.

(k) A listing of the types of provisions to be contained in

procurement contracts, including provisions concerning the nature and

monitoring of the work to be performed, the use of corporate supplies

and facilities, the use of corporate personnel and any other provisions.

(l) Provisions regarding procurement contracts which involve former

officers or employees of the corporation.

(m) Procedures regarding procurement contracts which are exempt from

the publication requirements of article four-C of the economic

development law.

(n) Policies to promote the participation by New York state business

enterprises and New York state residents in procurement contracts,

including, but not limited to:

(i) providing for the corporation to collect and to consult the

specifications of New York state business enterprises in developing

specifications for any procurement contract for the purchase of goods

where possible, practicable, feasible and consistent with open bidding,

except for procurement contracts for which the corporation would be

expending funds received from another state. The corporation shall,

where feasible, make use of the stock item specification forms prepared

by the commissioner of general services, and where necessary, consult

with the commissioner of the office of general services, in developing

such specifications and make such determinations; and

(ii) with the cooperation of the department of economic development

and through cooperative efforts with contractors, providing for the

notification of New York state business enterprises of opportunities to

participate as subcontractors and suppliers on procurement contracts let

by the corporation in an amount estimated to be equal to or greater than

one million dollars and promulgating procedures which will assure

compliance by contractors with such notification. Once awarded the

contract such contractors shall document their efforts to encourage the

participation of New York state business enterprises as suppliers and

subcontractors on procurement contracts equal to or greater than one

million dollars. Documented efforts by a successful contractor shall

consist of and be limited to showing that such contractor has (a)

solicited bids, in a timely and adequate manner, from New York state

business enterprises including certified minority and women-owned

business, or (b) contacted the New York state department of economic

development to obtain listings of New York state business enterprises,

or (c) placed notices for subcontractors and suppliers in newspapers,

journals and other trade publications distributed in New York state, or

(d) participated in bidder outreach conferences. If the contractor

determines that New York state business enterprises are not available to

participate on the contract as subcontractors or suppliers, the

contractor shall provide a statement indicating the method by which such

determination was made. If the contractor does not intend to use

subcontractors on the contract, the contractor shall provide a statement

verifying such intent; and

(iii) except for procurement contracts for which the corporation would

be expending funds received from another state, the corporation shall

include in all bid documents provided to potential bidders a statement

that information concerning the availability of New York state

subcontractors and suppliers is available from the New York state

department of economic development, which shall include the directory of

certified minority and women-owned businesses, and it is the policy of

New York state to encourage the use of New York state subcontractors and

suppliers, and to promote the participation of minority and women-owned

businesses where possible, in the procurement of goods and services; and

(iv) with the cooperation of the community services division of the

department of labor and through cooperative efforts with contractors,

providing for the notification of New York state residents of employment

opportunities arising in New York state out of procurement contracts let

by the corporation in an amount estimated to be equal to or greater than

one million dollars; and promulgating procedures which will assure

compliance by contractors with such notification by requiring

contractors to submit post-award compliance reports documenting their

efforts to provide such notification through listing any such positions

with the community services division, or providing for such notification

in such manner as is consistent with existing collective bargaining

contracts or agreements; and

(v) including in each set of documents soliciting bids on procurement

contracts to let by the corporation a statement notifying potential

bidders located in foreign countries that the corporation may assign or

otherwise transfer offset credits created by such procurement contract

to third parties located in New York state; providing for the assignment

or other form of transfer of offset credits created by such procurement

contracts, directly or indirectly, to third parties located in New York

state, in accordance with the written directions of the commissioner of

economic development; and providing for the corporation to otherwise

cooperate with the department of economic development in efforts to get

foreign countries to recognize offset credits assigned or transferred to

third parties located in New York state created by such procurement

contracts; and

(vi) promulgating procedures which will assure compliance with the

federal equal employment opportunity act of 1972 (P.L. 92-261), as

amended, by contractors of the corporation.

(o) For the purposes of this section, a "New York state business

enterprise" means a business enterprise, including a sole

proprietorship, partnership, or corporation, which offers for sale or

lease or other form of exchange, goods which are sought by the

corporation and which are substantially manufactured, produced or

assembled in New York state, or services which are sought by the

corporation and which are substantially performed within New York state.

(p) For the purposes of this section, a "New York resident" means a

natural person who maintains a fixed, permanent and principal home

located within New York state and to which such person, whenever

temporarily located, always intends to return.

4. Each corporation shall have the power from time to time to amend

such procurement contract guidelines in accordance with the provisions

of this section.

5. (a) Each corporation shall notify the commissioner of economic

development of the award of a procurement contract for the purchase of

goods or services from a foreign business enterprise in an amount equal

to or greater than one million dollars simultaneously with notifying the

successful bidder therefor. No corporation shall thereafter enter into a

procurement contract for said goods or services until at least fifteen

days has elapsed, except for procurement contracts awarded on an

emergency or critical basis, or where the commissioner of economic

development waives the provisions of this sentence. The notification to

the commissioner of economic development shall include the name, address

and telephone and facsimile number of the foreign business enterprise, a

brief description of the goods or services to be obtained pursuant to

the proposed procurement contract, the amount of the proposed

procurement contract, the term of the proposed procurement contract, and

the name of the individual at the foreign business enterprise or acting

on behalf of the same who is principally responsible for the proposed

procurement contract. Such notification shall be used by the

commissioner of economic development solely to provide notification to

New York state business enterprises of opportunities to participate as

subcontractors and suppliers on such procurement contracts, to promote

and encourage the location and development of new business in the state,

to assist New York state business enterprises in obtaining offset

credits from foreign countries, and to otherwise investigate, study and

undertake means of promoting and encouraging the prosperous development

and protection of the legitimate interest and welfare of New York state

business enterprises, industry and commerce.

(b) As used in this section, the following terms shall have the

following meanings, unless a different meaning appears from the context:

(i) "Foreign business enterprise" shall mean a business enterprise,

including a sole proprietorship, partnership or corporation, which

offers for sale, lease or other form of exchange, goods which are sought

by the corporation and which are substantially produced outside New York

state, or services, other than construction services, sought by the

corporation which are substantially performed outside New York state.

For purposes of construction services, foreign business enterprise shall

mean a business enterprise, including a sole proprietorship, partnership

or corporation, which has its principal place of business outside New

York state.

(ii) "New York state business enterprise" shall mean a business

enterprise, including a sole proprietorship, partnership or corporation,

which offers for sale or lease or other form of exchange, goods which

are sought by the corporation and which are substantially manufactured,

produced or assembled in New York state, or services, other than

construction services, which are sought by the corporation and which are

substantially performed within New York state. For purposes of

construction services, a New York state business enterprise shall mean a

business enterprise, including a sole proprietorship, partnership, or

corporation, which has its principal place of business in New York

state.

(iii) "Discriminatory jurisdiction" shall mean any other country,

nation, province, state or political subdivision thereof which employs a

preference or price distorting mechanism to the detriment of or

otherwise discriminates against a New York state business enterprise in

the procurement of goods and services by the same or a non-governmental

entity influenced by the same. Such discrimination may include, but is

not limited to, any law, regulation, procedure or practice, terms or

license, authorization, or funding or bidding rights which requires or

encourages any agency or instrumentality of the state or political

subdivision thereof or non-governmental entity influenced by the same to

discriminate against a New York state business enterprise.

(c) In including any additional business enterprises on invitations to

bid for the procurement of goods or services, the chief executive

officer of the corporation shall not include any foreign business

enterprise which has its principal place of business located in a

discriminatory jurisdiction contained on the list prepared by the

commissioner of economic development pursuant to subdivision six of

section one hundred sixty-five of the state finance law, except,

however, business enterprises which are New York state business

enterprises as defined by this section. The corporation may waive the

application of the provisions of this section whenever the chief

executive officer of the corporation determines in writing that it is in

the best interests of the state to do so. The chief executive officer of

the corporation shall deliver each such waiver to the commissioner of

economic development.

(d) A corporation shall not enter into a contract with a foreign

business enterprise which has its principal place of business located in

a discriminatory jurisdiction contained on the list prepared by the

commissioner of economic development pursuant to subdivision six of

section one hundred sixty-five of the state finance law. The provisions

of this section may be waived by the chief executive officer of the

corporation if the chief executive officer of the corporation determines

in writing that it is in the best interests of the state to do so. The

chief executive officer of the corporation shall deliver each such

waiver to the commissioner of economic development.

6. Each corporation, as part of the guidelines established pursuant to

subdivision three of this section, shall establish policies regarding

the preparation of publicly available reports on procurement contracts

entered into by such corporation. Such policies shall provide, at the

minimum, for the preparation of a report no less frequently than

annually, summarizing procurement activity by such corporation for the

period of the report, including a listing of all procurement contracts

entered into, all contracts entered into with New York state business

enterprises and the subject matter and value thereof, all contracts

entered into with certified minority or women-owned business enterprises

and the subject matter and value thereof, all referrals made and all

penalties imposed pursuant to section three hundred sixteen of the

executive law, all contracts entered into with foreign business

enterprises, and the subject matter and value thereof, the selection

process used to select such contractors, all procurement contracts which

were exempt from the publication requirements of article four-C of the

economic development law, the basis for any such exemption and the

status of existing procurement contracts.

7. Each corporation shall annually prepare and approve a report on

procurement contracts which shall include the guidelines, as specified

in subdivision three of this section, an explanation of the guidelines

and any amendments thereto since the last annual report. Such report on

procurement contracts may be a part of any other annual report that the

corporation is required to make.

8. (a) Each corporation shall annually submit its report on

procurement contracts to the division of the budget and copies thereof

to the department of audit and control, the department of economic

development, the senate finance committee and the assembly ways and

means committee. Such report shall include the total number and total

dollar value of contracts awarded to certified minority and women-owned

business enterprises pursuant to subparagraph (i) of paragraph (b) of

subdivision three of this section, shall distinguish by contract type

awards made pursuant to the authority provided under subparagraph (i) of

paragraph (b) of subdivision three of this section, and shall

additionally specify by contract type awarded pursuant to clause (B) of

subparagraph (i) of paragraph (b) of subdivision three of this section

and specify the total number, total dollar value and the percentage of

the total dollar value of contracts awarded to minority and women-owned

business entities and service disabled and veteran-owned business

entities for the reporting period, as compared to the prior reporting

year. Further, such report shall specify the total number, total dollar

value and percentage of contracts that exceed five hundred thousand

dollars awarded to minority and women owned business enterprises and

service-disabled veteran-owned businesses for the reporting period as

compared to the prior reporting period.

(b) Each corporation shall make available to the public copies of its

report on procurement contracts upon reasonable request therefor.

9. Nothing contained in this section shall be deemed to alter, affect

the validity of, modify the terms of or impair any contract or agreement

made or entered into in violation of, or without compliance with, the

provisions of this section.