Prohibits state agency or public authority to contract for goods or services from contractor or subsidiary thereof, when the contractor or subsidiary also contracts relating to a regulated activity

Title of bill

An act to amend the state finance law, in relation to prohibiting any state agency or public authority from contracting for goods and services with a contractor or a subsidiary thereof, when the contractor or a subsidiary thereof also provides consulting services or products relating to the activity for which the state agency or public authority seeks to contract

Purpose

To prohibit entities that state agencies contract with from further profiting by selling goods or services related to the services they provide under the contract.

Summary of provisions

Section one adds a new State Finance Law § 139-1 to disqualify any entity or subsidiary thereof from contracting with a state department, board, bureau, commission, division, office, council, committee or public authority when the entity or subsidiary also provides consulting services or products relating to the activity regulated by the agency or authority for which it seeks to contract.

Section two provides that the act shall take effect immediately.

Justification

It is becoming more and more common for New York State agencies to outsource certain obligations or responsibilities and to contract with outside firms to conduct studies, research and audits. It is imperative that the entities performing these tasks for the state do not also have a self interest in the activity for which they are contracted. For example, the state routinely seeks contractors to develop, run and maintain information systems for the state. These contractors should not be able to take advantage of state contracts by providing services or products to the public pertaining to the very systems that they develop, implement and/or oversee for the state.

This legislation will prohibit such practices by disqualifying any entity from state contracts when the entity also provides goods or services related to the very activity that the agency or authority seeks to contract for. Thus, ensuring that entities the state contracts with are not motivated by their own interests when carrying out the tasks they are paid to perform on behalf of the state and that they are not further profiting from their performance of state contracts.

Legislative history

New bill.

Fiscal implications

None.

Effective date

Immediately.