Provides for awarding of public works contracts and creates a privatization advisory board

3 Co-sponsors

• Peter Abbate
• Michael Cusick
• Mark J.F. Schroeder

2 Multi-sponsors

• Carl Heastie
• Audrey Pheffer

BILL NUMBER:A4716B

Title of bill

An act to amend the state finance law, in relation to awarding of contracts

Purpose

This bill intends to assure that privatizing governmental services provides actual cost savings and that services that are performed in the public's best interest are not privatized solely in response to fiscal considerations.

Summary of provisions

This bill would prohibit an agency or munici- pality from contracting for services unless: a) the proposed contract will result in actual cost savings to the state or municipality, provided that all the costs attendant to contracting out are compared equally to the costs associated with the provisions of these same services performed by the public workforce; b) the contractor's wages and benefits are at the same rate as employees currently providing the service or performing comparable work; c) the contract work includes costs that would be incurred by the agency as a result of entering into the contract, including the cost of contract administration, the costs of any regulatory or inspection function which the agency may be required to perform in connection with the services provided pursuant to the contract or the cost of personnel changes; provide that no contract can cause the replacement of workers including layoffs, demotions, involuntary transfers or reassignments, or reduction in the customary hours of work, wages, or benefits; - require that prior to executing a contract the agency shall prepare a statement stating reasons why the proposed contract meets the requirements of this act and any labor law violations the contractor has had within the past thirty-six months, including occupational safety and health administration violations, wage, hour or benefit violations; - require notification of the sched- uled award of a contract for services by the agency to the employee organization that represents agency employees. The employee organization would then be able to formally object prior to the awarding of the contract; and, - define of municipality and provides for prior notifica- tion to employee organization representing municipal employees who would otherwise perform such services.

Justification

While often assumed to be a cost-saving solution, contracting out services performed by the public workforce often results in higher costs and a loss of accountability, thus creating more fiscal problems to state and local governments. Currently competitive bids are accepted based upon the lowest cost estimate, with no safeguards to determine actual cost savings. This creates a false sense of security and results in cost over runs where governments and the public have no control and little oversight. In this era of fiscal austerity and tight budgets, many governments are being forced to cut costs. The best inter- est of the state, however, would be served by using the current work- force, already trained and experienced. Creating a screening procedure for contracting out insures that the fiscal and social interests of New York State are provided for.

Legislative history

A.6436 of 1997-1998: referred to Governmental Operations

A.4496 of 1999-2000: referred to Ways and Means

A.7377 of 2001-2002: referred to Governmental Operations

A.9874 of 2003-2004: Third Reading

A.1269 of 2005-2006: Passed Assembly: S.3672 referred to finance A.1647 of 2007-08: Passed Assembly

Fiscal implications

See bill text for Fiscal Note.

Effective date

This act shall take effect on the thirtieth day after it shall become a law.