Requires state agencies to pay small businesses within fifteen days of receipt of an invoice

1 Co-sponsor

• Terrence P. Murphy

Title of bill

An act to amend the state finance law, in relation to requiring state agencies to pay small businesses within fifteen days of receipt of an invoice; and to amend a chapter of the laws of 2015 amending the state finance law relating to requiring state agencies to pay small businesses within fifteen days of receipt of an invoice, as proposed in legislative bills numbers S.5283-A and A.6902-B, in relation to making technical corrections

Purpose or general idea of bill

The purpose of this bill is to ensure that small businesses are paid within fifteen days of receipt of an invoice for certain payments so that they may continue to sustain themselves and conduct their business activities. The bill makes technical corrections to chapter 568 of the laws of 2015.

Summary of specific provisions

Section 1. Amends section 179-f of the State Finance Law as amended by Chapter 568 of the laws of 2015 to provide that small businesses submit invoices electronically to take advantage of the expedited payment provisions and to change definition of small business from three hundred to two hundred employees.

Section 2. Amends effective date of Chapter 568 of the laws of 2015 to take effect three hundred sixty-five days after it shall have become a law.

Section 3. Effective date.

Justification

Many small businesses have limited available funds to carry them from each respective pay period, let alone month to month. Therefore, in order to ensure that small businesses and their employees are given the best opportunity to succeed and sustain themselves, it is imperative to implement an accelerated prompt pay system to ensure the sustainability of these businesses. Shortening the prompt payment provisions of the state finance law from 30 days to 15 days will help to facilitate meaningful and lasting participation of small businesses on state contracts.

State agencies would have one year to implement these changes to their prompt payment systems. Given the advances the state has made with improving its business practices and processing of payments through the Statewide Financial System and other practices, this bill should be able to be implemented smoothly in order to help small businesses succeed. Similar provisions have been successfully implemented in other parts of the country. This bill makes technical amendments to chapter 568 of the laws of 2015.

Prior legislative history

This is a new bill.

Fiscal implications

None

Effective date

This act shall take effect immediately; provided, however, that section one of this act shall take effect on the same date and in the same manner as chapter 568 of the laws of 2015 amending the the state finance law relating to requiring state agencies to pay small businesses within fifteen days of receipt of an invoice, takes effect.