Relates to participation by LGBT, disability and veteran-owned businesses in state contracts

Section 2 of the bill amends the executive law to create a new article 17-c entitled "Supplier Diversity in State Contracting Opportunities."

-Newly created section 369-m of the executive law sets the definitions of terms used throughout the New York State Supplier Diversity Act, including "certified LGBT, disability, or veteran-owned business enterprise," which is defined as a business enterprise, including a sole proprietorship, partnership, limited liability company or corporation that is: (a) at least 51% owned by one of more LGBT individuals, disabled individuals, or veterans; (b) an enterprise in which such ownership is real, substantial, and continuing; (c) an enterprise in which such ownership has and exercises the authority to control independently the day-to-day business decisions of the enterprise; (d) an enterprise authorized to business in this state and which is independently owned and operated; (e) an enterprise that is a small business which has a significant business presence in the state, not dominant in its field and employs, based on its industry, a certain number of persons as determined by the director of the Division of Supplier Diversity, but not to exceed three hundred, taking into consideration factors which include, but are not limited to, federal small business administration standards pursuant to 13 CFR part 121 and any amendments thereto; and (f) certified by the office of general services, or an approved third-party agency pursuant to subdivision five of section three hundred sixty-nine-n of this article.

-Newly created section 369-n of the executive law establishes the Division of Supplier Diversity within the Office of General Services, and gives the Director of the Division of Supplier Diversity the following powers and duties: (a) develop, collect, summarize and disseminate information to promote the establishment and successful operation of an LGBT, disability or veteran-owned business; (b) develop and make available to state agencies a directory of certified LGBT, disability and veteran-owned business enterprises; (c) assist state agencies in the development of programs to foster and promote the use of LGBT, disability and veteran-owned business enterprises on state contracts; (d) coordinate the plans, programs and operations of the state government which affect or may contribute to the establishment, preservation and development of LGBT, disability and veteran-owned business enterprises; (e) appoint independent hearing offices to preside over adjudicatory hearings pursuant to this section; and (f) in conjunction with the Commissioner of OGS, develop a comprehensive statewide plan and operation guidelines to promote LGBT, disability and veteran-owned business enterprises and to assist them in obtaining opportunities to participate in the procurement of goods and services by the state. -Section 369-n of the executive law also requires the Commissioner of OGS to do the following: (a) coordinate training of state agency procurement personnel, emphasizing the unique needs and requirements of LGBT, disability and veteran-owned business enterprises; (b) conduct a coordinated review of all existing and proposed state training and technical assistance activities in direct support of the supplier diversity program; (c) evaluate and assess availability of firms for the purpose of increasing participation in state contracting; (d) provide advice and technical assistance to promote LGBT, disability and veteran-owned business enterprises' understanding of state procurement laws, practices and procedures to facilitate and increase the participation of LGBT, disability and veteran-owned business enterprises in state procurement; (e) establish regular performance reporting systems regarding implementation of the programs designed to increase LGBT, disability and veteran-owned business participation in procurement contracts by state agencies; (f) submit a report by December 31 of each year detailing the number of contracts entered into pursuant to this article, the average amount of such contracts, the percentage of contracts a warded to LGBT, disability and veteran-owned business enterprises by each state agency, and other information.

-Section 369-n of the executive law also establishes a state certification process LGBT, disability, and veteran-owned business enterprises, and states that the Division of Supplier Diversity shall accept certification by approved third-party agencies to perform verification of LGBT, disability and/or veteran-owned business enterprises. Approved third-party agencies shall include the National Gay & Lesbian Chamber of Commerce for the certification of LGBT-owned business enterprises and the United States Business Leadership Network for the certification of disability-owned enterprises.

-Newly created section 369-o of the executive law directs the Director of the Division of Supplier Diversity to promulgate various rules and regulations to implement the New York State Supplier Diversity Act, including (a) providing measures and procedures to ensure that certified LGBT, disability and veteran-owned business enterprises are afforded the opportunity for meaningful participation in the performance of state contracts; (b) provide for measures and procedures that assist state agencies in the identification of state contracts where LGBT, disability and veterans contract goals are practical, feasible and appropriate for the purpose of increasing the utilization of LGBT, disability and veteran-owned business enterprise participation in state contracts; (c) achieve a statewide goal for participation on state contracts by LGBT, disability and veteran-owned business enterprises at a percentage to be determined by the OGS Commissioner; and others.

-Newly created section 369-p of the executive law is a severability clause.

Section 3 of the bill directs the commissioner of the office of general services to conduct a study to determine a statewide goal for participation on state contracts by LGBT, disability and veteran-owned business enterprises and to determine whether providing for the reservation or set-aside of certain procurements by state agencies should be required in order to achieve the objectives of article 17-c of the executive law.

Section 4 of the bill states that the study required by section 3 shall be completed no later than one year after this bill has been enacted.

Section 5 of the bill sets an immediate effective date and provides for the repeal of the act five years after the effective date.

Justification

The Supplier Diversity Act would make New York the first state to legislatively establish a comprehensive, statewide program to provide traditionally underrepresented small businesses with greater economic opportunity through meaningful participation in New York State's nearly $240 billion contracting and procurement system.

This legislation, which expands on recent initiatives in Massachusetts and California, will cultivate innovation, create jobs, and drive economic growth for an estimated 86,000 LGBT-owned, 25,000 veteran-owned, and thousands of disability-owned businesses throughout the state.

The bill also builds upon the success that New York's MWBE program has had in promoting the participation of minority-and-women-owned business enterprises in state contracting.

Under the provisions of the bill, the state would create a new Division of Supplier Diversity within the Office of General Services that would serve as a resource for the establishment, growth and success of small businesses owned by members of the LGBT, disability, or veteran communities.

Prior legislative history

New bill.

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately and shall expire and be deemed repealed five years after such effective date.