STATE OF NEW YORK
________________________________________________________________________
5817--B
2011-2012 Regular Sessions
IN SENATE
June 17, 2011
___________
Introduced by Sen. MARCELLINO -- (at request of the State Comptroller)
-- read twice and ordered printed, and when printed to be committed to
the Committee on Rules -- recommitted to the Committee on Finance in
accordance with Senate Rule 6, sec. 8 -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee
AN ACT to amend the state finance law, in relation to program procure-
ments, clarifying the definition of services, allowing the state comp-
troller to excuse non-material deviations in procurement procedures
and allowing for pilot procurement methods
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The state finance law is amended by adding a new article
2 11-C to read as follows:
3 ARTICLE XI-C
4 PROGRAM PROCUREMENTS
5 Section 179-ff. Definitions.
6 179-gg. Program procurements.
7 179-hh. Request for exemption.
8 179-ii. Program procurement process.
9 § 179-ff. Definitions. As used in this article the following terms
10 shall have the following meanings unless otherwise specified:
11 1. "Costs" shall be quantifiable and may include, without limitation,
12 the price of providing the given good or service and the administrative,
13 training, storage, maintenance or other overhead expense associated with
14 a given good or service.
15 2. "Emergency" means an urgent and unexpected requirement where public
16 health, safety, or welfare or the conservation of public resources is at
17 risk.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10876-12-2
S. 5817--B 2
1 3. "Price" means the amount of money set as consideration for a good
2 or service and may include when applicable and when specified in the
3 proposal/application, delivery charges, installation charges and other
4 costs.
5 4. "Procurement record" means documentation of the decisions made and
6 the approach taken in the procurement process.
7 5. "Program" means a provision of law authorizing a state agency to
8 undertake activities that are to be accomplished in whole or in part
9 through contracts with certain entities including, but not limited to,
10 not-for-profit organizations, for-profit organizations, municipalities
11 or any combination thereof.
12 6. "Program procurement" means a procurement which:
13 a. seeks a contract pursuant to which the vendor would provide
14 services or commodities directly to the public or a segment of the
15 public and not directly to a state agency, provided that such service
16 shall not include the construction or reconstruction of buildings,
17 bridges, roads, and appurtenances for use by the state;
18 b. provides the applicant with discretion in the manner in which the
19 purpose is to be accomplished with few specific limitations on the
20 manner of delivery; and
21 c. has been granted an exemption pursuant to the provisions of section
22 one hundred seventy-nine-hh of this article where such exemption is
23 required by section one hundred seventy-nine-gg of this article.
24 A program procurement provides the proposer or applicant with wide
25 discretion and latitude in the manner in which the purpose is to be
26 accomplished with few specific limitations on the scope of the proposal
27 or application.
28 7. "Public corporation" means a city, town, village, school district,
29 a district corporation or a public benefit corporation as those terms
30 are defined in section sixty-six of the general construction law.
31 8. "Responsible" or "responsibility" means the financial ability,
32 legal capacity, integrity, and past performance of a business entity and
33 as such terms have been interpreted relative to public procurements.
34 9. "Responsive" means a proposer or applicant meeting the minimum
35 specifications or requirements as prescribed in a solicitation issued by
36 a state agency.
37 10. "Single source" means a program procurement in which although two
38 or more proposers or applicants can supply the required goods or
39 services, the state agency, upon written findings setting forth the
40 material and substantial reasons therefor, may award the contract to one
41 proposer or applicant over another. The state agency shall document in
42 the procurement record the circumstances leading to the selection of the
43 proposer or applicant, including the alternatives considered, the
44 rationale for selecting the specific proposer or applicant and the basis
45 upon which the state agency determined that the cost was reasonable.
46 11. "Solicitation document" means the document issued by a state agen-
47 cy notifying prospective proposers or applicants that the state agency
48 wishes to receive proposals or applications for providing goods or
49 services.
50 12. "Sole source" means a program procurement in which only one propo-
51 ser or applicant is capable of supplying the required goods or services.
52 13. "Specification" or "requirement" means any description of the
53 physical or functional characteristics or the nature of a good or
54 service, any description of the services to be performed, the goods or
55 services to be provided, the necessary qualifications of the proposer or
56 applicant, the capacity and capability of the proposer or applicant to
S. 5817--B 3
1 complete the proposed contract successfully, or the process for achiev-
2 ing specific results or anticipated outcomes, or both, or any other
3 requirement necessary to perform the work. It may include a description
4 of any obligatory testing, inspection or preparation for delivery and
5 use, and may include federally required provisions and conditions where
6 the eligibility for federal funds is conditioned upon the inclusion of
7 such federally required provisions and conditions. Specifications shall
8 be designed to enhance competition and, where appropriate, set forth the
9 relative importance or weight of geographic distribution and assessment
10 of need.
11 14. "State agency" or "state agencies" means all state departments,
12 boards, commissions, offices or institutions but excludes, however, for
13 the purposes of subdivision five of section three hundred fifty-five of
14 the education law, the state university of New York, and excludes, for
15 the purposes of subdivision a of section sixty-two hundred eighteen of
16 the education law, the city university of New York. Furthermore, such
17 term shall not include the legislature or the judiciary.
18 § 179-gg. Program procurements. The program procurement process set
19 forth in this article, rather than the requirements of article eleven of
20 this chapter, shall apply to:
21 1. program procurements open only to not-for-profit organizations or
22 public corporations or both, and
23 2. those program procurements open to profit-seeking entities where
24 the state agency has obtained from the state comptroller, in accordance
25 with section one hundred seventy-nine-hh of this article, an exemption
26 from the requirements of article eleven of this chapter.
27 § 179-hh. Request for exemption. Before the issuance of a solicitation
28 document, a state agency conducting a procurement open to profit-seeking
29 entities which the state agency believes falls within the meaning of a
30 program procurement, as defined in this article, shall make a written
31 request to the state comptroller for an exemption from the requirements
32 of article eleven of this chapter. The state comptroller shall make a
33 written determination as to whether the proposed procurement falls with-
34 in the definition of a program procurement as set forth in section one
35 hundred seventy-nine-ff of this article and is in the best interest of
36 the state, and shall either grant or deny the exemption on the basis of
37 such determination. If the state comptroller grants a state agency an
38 exemption from the requirements of article eleven of this chapter, the
39 program procurement shall be conducted in accordance with the require-
40 ments of this article.
41 § 179-ii. Program procurement process. 1. Method of procurement. The
42 state agency shall document in the procurement record and in advance of
43 the initial receipt of proposals/applications the determination of the
44 evaluation criteria, and the weight assigned to each, and the process to
45 be used in the determination of award or funding, and the manner in
46 which the evaluation and selection shall be conducted.
47 2. Public notice. All program procurements by state agencies or an
48 award or funding in excess of fifteen thousand dollars shall be adver-
49 tised in the state's procurement opportunities newsletter in accordance
50 with article four-C of the economic development law.
51 3. Soliciting and accepting proposals or applications. A solicitation
52 document issued by a state agency shall prescribe the minimum specifica-
53 tions or requirements that must be met to be considered responsive and
54 shall describe and disclose the general manner in which the evaluation
55 and selection shall be conducted. Where appropriate, the solicitation
56 document shall identify the relative importance or weight of cost and
S. 5817--B 4
1 the overall technical criteria to be considered by a state agency in
2 making a program procurement determination. Consideration, where appro-
3 priate, should include geographic distribution of funding based on
4 assessed needs of the community.
5 4. Selection and contract award. a. Selection and contract award shall
6 be consistent with: (i) the terms of the solicitation document issued by
7 the state agency; and (ii) the contract award methodology set forth in
8 the procurement record before the initial receipt of proposals or appli-
9 cations.
10 b. Program procurement awards shall be made to a proposer or applicant
11 on the basis of technical merit with the consideration given to the
12 reasonableness of costs. The contract award or awards or funding shall
13 be allocated to the highest ranked proposal or proposals. Nothing in
14 this section, however, shall be deemed to prohibit a state agency from
15 evaluating cost separately in its selection and contract award.
16 c. A procurement record shall be maintained for each program procure-
17 ment identifying, with supporting documentation, decisions made by the
18 state agency during the procurement process.
19 d. Selection and contract award shall be a written determination in
20 the procurement record made by the state agency.
21 e. Prior to making a program procurement award, the state agency shall
22 make a determination of the responsibility of the proposer or applicant.
23 5. Reduction of award. A state agency may reduce the monetary amount
24 of the awards made under a program procurement if the state agency
25 reserves the right to make such a reduction in the solicitation document
26 and such reduction is consistent with a predefined methodology set forth
27 in the procurement record prior to the receipt of initial proposals or
28 applications.
29 6. Discretionary program procurement awards. A state agency may make a
30 program procurement award in an amount not exceeding fifty thousand
31 dollars without a formal competitive process. The state agency shall,
32 however, document that the amount of the award or funding is reasonable.
33 7. Contract awards. a. Contract awards shall be made on the basis of
34 highest rank in accordance with the selection and award methodology
35 established in accordance with the program requirements set forth by
36 each agency for such program.
37 b. Single or sole source contract awards, or contract awards made to
38 meet emergencies arising from unforeseen causes, may be made without a
39 formal competitive process and shall only be made under unusual circum-
40 stances and shall be based upon a determination by the state agency that
41 the specifications or requirements for such award have been designed in
42 a fair and equitable manner. The state agency shall document in the
43 procurement record, subject to review by the state comptroller, the
44 basis for a determination to make an award to a single source or sole
45 source, or the nature of the emergency giving rise to the award.
46 8. Contracts. Any contract resulting from a program procurement
47 awarded pursuant to the provisions of this article that includes funding
48 for commodities or construction services in excess of fifty thousand
49 dollars shall include contract language requiring the contractor to
50 acquire such commodities and/or construction services pursuant to a
51 competitive bidding process.
52 9. Review by the office of the state comptroller. Review by the office
53 of the state comptroller shall be in accordance with section one hundred
54 twelve of this chapter.
S. 5817--B 5
1 § 2. Subdivision 7 of section 160 of the state finance law, as amended
2 by section 30 of part L of chapter 55 of the laws of 2012, is amended to
3 read as follows:
4 7. "Service" or "services" means the performance of a task or tasks
5 and may include a material good or a quantity of material goods, and
6 which is the subject of any purchase or other exchange. For the purposes
7 of this article, technology shall be deemed a service. Services, as
8 defined in this article, shall not apply to those contracts for (i)
9 architectural, engineering or surveying services, [or those contracts
10 approved] (ii) services provided by a not-for-profit organization in
11 accordance with article eleven-B of this chapter, or (iii) services
12 obtained through program procurements in accordance with article
13 eleven-C of this chapter.
14 § 3. Subdivision 12 of section 163 of the state finance law, as added
15 by chapter 83 of the laws of 1995, is amended to read as follows:
16 12. Review by the office of the state comptroller. Review by the
17 office of the state comptroller shall be in accordance with section one
18 hundred twelve of this chapter. Where the contracting agency has not
19 complied with one or more provisions of this article, the comptroller
20 may approve the awarded contract if:
21 a. the contracting agency determines and certifies, based upon a
22 preponderance of the evidence documented in the procurement record, that
23 the noncompliance was a non-material deviation from one or more
24 provisions of this article. For the purposes of this subdivision "non-
25 material deviation" shall mean that such noncompliance did not prejudice
26 or favor any vendor or potential vendor, such noncompliance did not
27 substantially affect the fairness of the competitive process, and that a
28 new procurement would not be in the best interest of the state. Such
29 determination by the contracting agency and the comptroller shall be
30 documented in the procurement record; and
31 b. the state comptroller concurs in such determination.
32 § 4. This act shall take effect immediately and shall apply to any
33 procurement initiated on or after such date; provided, however, that the
34 amendments to section 163 of the state finance law made by section three
35 of this act shall not affect the repeal of such section as provided in
36 subdivision 5 of section 362 of chapter 83 of the laws of 1995, as
37 amended, and shall be deemed repealed therewith.
