Adds employee-owned enterprises and worker cooperatives to the list of preferred contractors for public contracts in the state; authorizes such enterprises and cooperatives to make certain purchases from centralized contracts for commodities, subject to conditions of the office of general services; authorizes the comptroller to conduct certain audits of employee-owned enterprises and worker cooperatives.
STATE OF NEW YORK
________________________________________________________________________
648
2025-2026 Regular Sessions
IN SENATE(Prefiled)
January 8, 2025
___________
Introduced by Sen. S. RYAN -- read twice and ordered printed, and when
printed to be committed to the Committee on Procurement and Contracts
AN ACT to amend the state finance law, in relation to adding employee-
owned enterprises to the list of preferred contractors for public
contracts in the state
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivisions 6, 7, 8, 9 and 10 of section 160 of the state
2 finance law are renumbered subdivisions 7, 8, 9, 10 and 11, and a new
3 subdivision 6 is added to read as follows:
4 6. "Employee-owned enterprise" shall have the same meaning as defined
5 by section eighteen hundred thirty-six-b of the public authorities law.
6 § 2. Subdivision 2 of section 162 of the state finance law is amended
7 by adding a new paragraph g to read as follows:
8 g. Commodities and services produced by an employee-owned enterprise
9 or a worker cooperative incorporated under the laws of this state and
10 governed by article five-A of the cooperative corporations law.
11 § 3. Subparagraph (iii) of paragraph a and the opening paragraph of
12 paragraph b of subdivision 4 of section 162 of the state finance law, as
13 amended by chapter 565 of the laws of 2022, are amended to read as
14 follows:
15 (iii) When commodities are available, in the form, function and utili-
16 ty required by, a state agency or political subdivision or public bene-
17 fit corporation having their own purchasing agency, and such commodities
18 are not available pursuant to subparagraphs (i) and (ii) of this para-
19 graph, said commodities shall then be purchased from a qualified non-
20 profit-making agency for other disabled persons, a qualified special
21 employment program for mentally ill persons, [or] a qualified veterans'
22 entity, or a qualified employee-owned enterprise or worker cooperative;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
S LBD02465-01-5
S. 648 2
1 provided, however, the preferred source shall perform fifty percent or
2 more of the work;
3 When services are available, in the form, function and utility
4 required by, a state agency or political subdivision or public benefit
5 corporation having their own purchasing agency, equal priority shall be
6 accorded the services rendered and offered for sale by qualified non-
7 profit-making agencies for the blind and those for the other disabled,
8 by qualified special employment programs for mentally ill persons [and],
9 by qualified veterans' entities, and by qualified employee-owned enter-
10 prises or worker cooperatives; provided, however, the preferred source
11 shall perform fifty percent or more of the work. In the case of
12 services:
13 § 4. Subparagraph (iii) of paragraph a and the opening paragraph of
14 paragraph b of subdivision 4 of section 162 of the state finance law, as
15 added by chapter 83 of the laws of 1995, are amended to read as follows:
16 (iii) When commodities are available, in the form, function and utili-
17 ty required by, a state agency or political subdivision or public bene-
18 fit corporation having their own purchasing agency, and such commodities
19 are not available pursuant to subparagraphs (i) and (ii) of this para-
20 graph, said commodities shall then be purchased from a qualified non-
21 profit-making agency for other [severely] disabled persons, a qualified
22 special employment program for mentally ill persons, [or] a qualified
23 veterans' [workshop] entity, or a qualified employee-owned enterprise or
24 worker cooperative;
25 When services are available, in the form, function and utility
26 required by, a state agency or political subdivision or public benefit
27 corporation having their own purchasing agency, equal priority shall be
28 accorded the services rendered and offered for sale by qualified non-
29 profit-making agencies for the blind and those for the other [severely]
30 disabled, by qualified special employment programs for mentally ill
31 persons [and], by qualified veterans' [workshops] entities, and by qual-
32 ified employee-owned enterprises or worker cooperatives. In the case of
33 services:
34 § 5. Section 162 of the state finance law is amended by adding a new
35 subdivision 6-a to read as follows:
36 6-a. Prices charged by employee-owned enterprises or worker cooper-
37 atives.
38 a. Qualified employee-owned enterprises or worker cooperatives may
39 make purchases of materials, equipment or supplies, except printed mate-
40 rial, from centralized contracts for commodities in accordance with the
41 conditions set by the office of general services; provided that such
42 qualified employee-owned enterprise or worker cooperative shall accept
43 sole responsibility for any payment due to the vendor.
44 b. The state comptroller may conduct audits and examinations of all
45 records, books and data of any employee-owned enterprise or worker coop-
46 erative qualified under this section to determine the costs of manufac-
47 turing or the rendering of services and the manner and efficiency of
48 production and administration of such employee-owned enterprise or work-
49 er cooperative with relation to any product or services purchased by a
50 state agency or political subdivision or public benefit corporation and
51 to furnish the results of such audit and examination to the commissioner
52 for such action as such commissioner may deem appropriate under this
53 section.
54 § 6. This act shall take effect on the ninetieth day after it shall
55 have become a law; provided, however, that the amendments to subpara-
56 graph (iii) of paragraph a and the opening paragraph of paragraph b of
S. 648 3
1 subdivision 4 of section 162 of the state finance law made by section
2 three of this act shall be subject to the expiration and reversion of
3 such subparagraph and opening paragraph pursuant to section four of
4 chapter 565 of the laws of 2022, as amended, when upon such date the
5 provisions of section four of this act shall take effect. Effective
6 immediately, the addition, amendment and/or repeal of any rule or regu-
7 lation necessary for the implementation of this act on its effective
8 date are authorized to be made and completed on or before such effective
9 date.
