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History
- Referred to finance
- Referred to finance
Full text
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Sponsor's memo
BILL NUMBER:S3570
Title of bill
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 performance and payment bond requirements
Purpose
Minority and women-owned businesses have come to constitute a large percentage of businesses in New York MWBEs, just like small busi- nesses, are an increasingly crucial part of the state's economy, and contribute vastly to our economy's growth. However, despite these increases, MWBEs continue to face barriers in government contracting. This bill seeks to address and eliminate some of these barriers by enhancing Article 15-A provisions and increasing small business and minority and women-owned business enterprise (MWBE) participation in State agency commodity and service procurement and state public authori- ty assisted, construction and rehabilitation project contracts and subcontracts.
Read the full memo (659 words)
Summary of provisions
* Creates a Small Business and MWBE Mentor/protege Program.
* Creates violations against contractors failing to comply with Article 15-A.
* Expands contracting opportunities to certified MWBEs by creating a Division web site where certified MWBEs can access contracting and subcontracting opportunities.
* Requires contractors to provide utilization plans at the time a bid is submitted.
* Requires the posting of contractor MWBE utilization plans and prohib- its the use of automatic waivers.
* Requires a contracting agency to notify both the winning bidder and any certified MWBE affiliated with such winning bid.
* Provides for greater contracting opportunities by alleviating the burden of performance and payment bonds for small businesses and certi- fied MWBEs when the aggregate amount of the contract is under $1,000,000.
* Increases MWBE and small business participation in state public authority assisted, construction and rehabilitation projects.
Justification
Public purchasing is one of government's most important functions. Its effective use or potential abuse can have a substantial impact on governmental efficiency, the income of particular companies and communities, and the financial burden of taxpayers. Over many years,
minority-owned and women-owned businesses have experienced difficulties in tapping into government procurement purchasing programs. Barriers to government contracts still exist for MWBEs because they are smaller in size and fewer in number than majority-firms. Small businesses experi- ence similar barriers when trying to participate in government contract- ing.
According to the Division of Minority and Women Business Development, MWBEs represent 943,616 firms in New York, generating over $100 Billion in revenues alone in 2006. According to the Census, New York ranks first in the number of black-owned firms (with 129,324), second in women-owned firms (505,134), and fourth in Hispanic-owned firms (163,639). However, as of March 31, 2003, the Division reported that there were 6,843 MWBE- certified businesses in New York State. About half of these firms are located in the New York City region. The Division reports that State agency expenditures for MWBEs statewide totaled $558 million, $480 million, and $513 million respectively, 2001-2002, 2002-2003, and 2004- 2005 State Fiscal Years.
Problems with the implementation of Article 15-A include, but are not limited to, lack of enforcement measures. Currently, the statute provides no penalty for contractors who intentionally use or acquire an MWBE name through deceit or fraud.
Historically speaking, the Pataki Administration failed to effectively administer the State's MWBE programs. Between SFY 2001-02 and SFY 2004- 05, there was a 33% decline in the total dollar volume of State agency contracts being let to MWBEs.
* In SFY 2001-02 New York State agencies entered into $7.4 billion in service, technology, commodity and construction contracts.
* $558 million (or 7.5%) of these SFY 2001-02 contracts were let to MWEEs.
* In SFY 2004-05 New York State agencies entered into $10.1 billion in service, technology, commodity and construction contracts.
* $513 million (or 5%) of these SFY 2004-05 contracts were let to MWBEs.
Legislative history
S.2431 of 2007-08: Referred to Finance S.4457 of 2011-12: Referred to Finance
Fiscal implications
Minimal.
Local fiscal implications
Minimal.
Effective date
This act shall take effect immediately, with provisions.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.