senate Bill S3093A

Relates to the cost effectiveness of consultant contracts by state agencies

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 08 / Feb / 2011
    • REFERRED TO FINANCE
  • 04 / Jan / 2012
    • REFERRED TO FINANCE
  • 01 / May / 2012
    • 1ST REPORT CAL.665
  • 02 / May / 2012
    • 2ND REPORT CAL.
  • 07 / May / 2012
    • ADVANCED TO THIRD READING
  • 14 / May / 2012
    • AMENDED ON THIRD READING 3093A
  • 21 / Jun / 2012
    • COMMITTED TO RULES

Summary

Relates to the cost effectiveness of consultant contracts by state agencies; defines "consultant services".

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Bill Details

Versions:
S3093
S3093A
Legislative Cycle:
2011-2012
Current Committee:
Senate Rules
Law Section:
State Finance Law
Laws Affected:
Amd §163, St Fin L

Sponsor Memo

BILL NUMBER:S3093A

TITLE OF BILL:
An act
to amend the state finance law, in relation to the cost effectiveness of
consultant contracts by the state agencies

PURPOSE OR GENERAL IDEA OF BILL:
Sets forth conditions when an agency
shall enter into a contract for consultant services.
Requires agencies to conduct a cost comparison prior to entering into
a contract for consultant services to determine if there is a less
expensive alternative.

SUMMARY OF SPECIFIC PROVISIONS:
Amends the state finance law by
amending section 163 to add a new subdivision 15, setting forth
conditions that must be met when an agency shall enter into a
contract for consulting services of more than $500,000. The agency
shall compare costs to determine whether the work can be performed at
lower cost by utilizing state employees rather than consultants.
Certain exceptions are specified when this cost comparison is not
required. The agency must retain documentation of the cost comparison
as a public record.

JUSTIFICATION:
The purpose of this bill is to require state agencies
to do cost comparisons before entering into contracts for consultant
services.
Any time the taxpayers' money is used to fund a contract for services
there is a need to insure that this expenditure is necessary and
prudent. The State of New York spends over $2 Billion per year on
consultants. In many cases these consultants perform work that could
be done by professional state employees and the cost of using
consultants is substantially higher.

In 1998 the use of engineering consultants by the State Department of
Transportation was studied by the State Comptroller and OSC concluded
that the State could save millions of dollars by reducing the use of
consultants. The Comptroller recommended cost/benefit analysis prior
to contracting with consultants. other studies have confirmed this
finding, including an analysis by the State Assembly in 2009 that
estimated the state could save $250 million over three years by
reducing the use of information technology consultants. In 2010 The
state Senate Task Force on Government Efficiency estimated
that the Department of Transportation could save about $46 million per
year by implementing this policy.

In 2009 the Federal Office of Management and Budget issued a directive
to Federal government agencies that calls for them to perform a cost
benefit analysis before entering into contracts and to initiate pilot
projects for in-sourcing work in cases where the cost analysis
supports the conclusion that the work can be performed by government
employers at lower cost that by using contractors. OMB estimates that
this and other contracting reforms can save the Federal government
$40 Billion.


LEGISLATIVE HISTORY:
New Bill.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
This act shall take effect on the ninetieth day after
it shall have become a law, with provisions.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 3093--A
    Cal. No. 665

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                            February 8, 2011
                               ___________

Introduced  by  Sens.  ROBACH, ADDABBO, AVELLA -- read twice and ordered
  printed, and when printed to be committed to the Committee on  Finance
  --  recommitted  to the Committee on Finance in accordance with Senate
  Rule 6, sec. 8 -- reported favorably from said committee,  ordered  to
  first  and  second  report,  ordered  to  a third reading, amended and
  ordered reprinted, retaining its place in the order of third reading

AN ACT to amend the state finance law, in relation to  the  cost  effec-
  tiveness of consultant contracts by the state agencies

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 163 of the state finance law is amended by adding a
new subdivision 15 to read as follows:
  15. CONSULTANT SERVICES. A.  BEFORE  A  STATE  AGENCY  ENTERS  INTO  A
CONTRACT  FOR CONSULTANT SERVICES WHICH IS ANTICIPATED TO COST MORE THAN
FIVE HUNDRED THOUSAND DOLLARS IN A TWELVE MONTH PERIOD THE STATE  AGENCY
SHALL CONDUCT A COST COMPARISON REVIEW TO DETERMINE WHETHER THE SERVICES
TO BE PROVIDED BY THE CONSULTANT CAN BE PERFORMED AT EQUAL OR LOWER COST
BY  UTILIZING  STATE  EMPLOYEES,  UNLESS  THE  CONTRACT MEETS ONE OF THE
EXCEPTIONS SET FORTH IN PARAGRAPH B OF THIS SUBDIVISION.  AS    USED  IN
THIS  SECTION,  THE  TERM  "CONSULTANT SERVICES" SHALL MEAN ANY CONTRACT
ENTERED INTO BY A  STATE  AGENCY  FOR  ANALYSIS,  EVALUATION,  RESEARCH,
TRAINING,  DATA PROCESSING, COMPUTER PROGRAMMING, ENGINEERING, ARCHITEC-
TURE, ENVIRONMENTAL, HEALTH SERVICES, MENTAL HEALTH  SERVICES,  ACCOUNT-
ING, AUDITING, OR SIMILAR SERVICES, BUT SHALL NOT INCLUDE LEGAL SERVICES
OR SERVICES IN CONNECTION WITH LITIGATION INCLUDING EXPERT WITNESSES AND
SHALL  NOT  INCLUDE  CONTRACTS  FOR  CONSTRUCTION  OF  PUBLIC WORKS. FOR
PURPOSES OF THIS SUBDIVISION, THE COSTS OF PERFORMING  THE  SERVICES  BY
STATE  EMPLOYEES SHALL INCLUDE ANY SALARY, PENSION COSTS, OR OTHER BENE-
FITS INCLUDING ANY INCREMENTAL COSTS THAT ARE  REQUIRED  FOR  EQUIPMENT,
FACILITIES  OR  OTHER  OVERHEAD.  THE COSTS OF CONSULTANT SERVICES SHALL
INCLUDE THE TOTAL COST OF THE CONTRACT PLUS ANY COSTS  INCURRED  BY  THE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08715-02-2

S. 3093--A                          2

AGENCY  IN  ADMINISTERING  THE  CONTRACT  OVER AND ABOVE THE COSTS WHICH
WOULD HAVE BEEN INCURRED  BY  THE  AGENCY  IF  SUCH  SERVICES  HAD  BEEN
PERFORMED  BY  STATE  EMPLOYEES.  THE COST COMPARISON SHALL BE EXPRESSED
WHERE  FEASIBLE  AS  AN  HOURLY RATE, OR WHERE SUCH A CALCULATION IS NOT
FEASIBLE, AS A TOTAL ESTIMATED COST FOR  THE  ANTICIPATED  TERM  OF  THE
CONTRACT.
  B. A COST COMPARISON SHALL NOT BE REQUIRED IF:
  (I)  THE  SERVICES  ARE INCIDENTAL TO THE PURCHASE OF REAL OR PERSONAL
PROPERTY; OR
  (II) THE CONTRACT IS NECESSARY IN ORDER TO AVOID A CONFLICT OF  INTER-
EST ON THE PART OF THE AGENCY OR ITS EMPLOYEES; OR
  (III)  THE SERVICES ARE OF SUCH A HIGHLY SPECIALIZED NATURE THAT IT IS
NOT FEASIBLE TO UTILIZE STATE  EMPLOYEES  TO  PERFORM  THEM  OR  REQUIRE
SPECIAL  EQUIPMENT  THAT  IS  NOT  FEASIBLE FOR THE STATE TO PURCHASE OR
LEASE; OR
  (IV) THE SERVICES ARE OF SUCH AN URGENT NATURE THAT IT IS NOT FEASIBLE
TO UTILIZE STATE EMPLOYEES; OR
  (V) THE SERVICES ARE ANTICIPATED TO BE SHORT TERM AND ARE  NOT  LIKELY
TO BE EXTENDED OR REPEATED AFTER THE CONTRACT IS COMPLETED.
  C. NOTHING IN THIS SECTION SHALL BE DEEMED TO AUTHORIZE A STATE AGENCY
TO ENTER INTO A CONTRACT WHICH IS OTHERWISE PROHIBITED BY LAW.
  D.  ALL  DOCUMENTS  RELATED  TO  THE  COST COMPARISON REQUIRED BY THIS
SUBDIVISION SHALL BE PUBLIC RECORDS SUBJECT TO  DISCLOSURE  PURSUANT  TO
ARTICLE SIX OF THE PUBLIC OFFICERS LAW.
  S  2.  This  act shall take effect on the ninetieth day after it shall
have become a law; provided, however, that the amendments to section 163
of the state finance law made by section  one  of  this  act  shall  not
affect  the  repeal of such section and shall be deemed to repeal there-
with.

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