Establishes that not-for-profit organizations and public benefit corporations shall be entitled to all prompt contracting interest due from a state agency at the time of the first payment

1 Co-sponsor

• Tony Avella

BILL NUMBER:S6482

Title of bill

An act to amend the state finance law, in relation to the payment of interest due to not-for-profit organizations and public benefit corporations

Purpose

To require agencies to pay any prompt contracting interest due within thirty days of the date the payment or payments required under a contract approved late are made to a not-for-profit organization.

Summary of provisions

Section 1 - amends Subdivision 2 of Section 179-v of the State Finance Law to establish that a not-for-profit organization shall be entitled to receive all interest due from a state agency pursuant to this Section within thirty days of the date the payment or payments required under a contract are made to any such organization. Provided, however, if monies from any appropriation or appropriations as described in Subdivision 3 of Section 179-v of the State Finance Law are not available for the payment of such interest, such payment shall be made immediately after such monies become available.

Section 2 - provides for an effective date of immediately after this bill is signed into law.

Prior legislative history

2012 - S.6469/A.9342

Justification

The Prompt Contracting law (Article 11-B of the State Finance Law) establishes the requirements for interest that is due on late contracts for grants, but does not include public benefit corps and does not establish when that interest must be paid. This creates an incentive for agencies to pay interest late in the year or not at all. This situation makes the law ineffective and disadvantages not-for-profits and public benefit corps.

Budget implications

None

Effective date

This act shall take effect immediately.