S T A T E O F N E W Y O R K
________________________________________________________________________
8096
2011-2012 Regular Sessions
I N A S S E M B L Y
June 1, 2011
___________
Introduced by M. of A. GLICK -- (at request of the State Comptroller) --
read once and referred to the Committee on Governmental Operations
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:
Section 1. The state finance law is amended by adding a new article
11-C to read as follows:
ARTICLE XI-C
PROGRAM PROCUREMENTS
SECTION 179-FF. DEFINITIONS.
179-GG. PROGRAM PROCUREMENTS.
179-HH. REQUEST FOR EXEMPTION.
179-II. PROGRAM PROCUREMENT PROCESS.
S 179-FF. DEFINITIONS. AS USED IN THIS ARTICLE THE FOLLOWING TERMS
SHALL HAVE THE FOLLOWING MEANINGS UNLESS OTHERWISE SPECIFIED:
1. "COSTS" SHALL BE QUANTIFIABLE AND MAY INCLUDE, WITHOUT LIMITATION,
THE PRICE OF PROVIDING THE GIVEN GOOD OR SERVICE AND THE ADMINISTRATIVE,
TRAINING, STORAGE, MAINTENANCE OR OTHER OVERHEAD EXPENSE ASSOCIATED WITH
A GIVEN GOOD OR SERVICE.
2. "EMERGENCY" MEANS AN URGENT AND UNEXPECTED REQUIREMENT WHERE PUBLIC
HEALTH, SAFETY, OR WELFARE OR THE CONSERVATION OF PUBLIC RESOURCES IS AT
RISK.
3. "PRICE" MEANS THE AMOUNT OF MONEY SET AS CONSIDERATION FOR A GOOD
OR SERVICE AND MAY INCLUDE WHEN APPLICABLE AND WHEN SPECIFIED IN THE
PROPOSAL/APPLICATION, DELIVERY CHARGES, INSTALLATION CHARGES AND OTHER
COSTS.
4. "PROCUREMENT RECORD" MEANS DOCUMENTATION OF THE DECISIONS MADE AND
THE APPROACH TAKEN IN THE PROCUREMENT PROCESS.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10876-03-1
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5. "PROGRAM" MEANS A PROVISION OF LAW AUTHORIZING A STATE AGENCY TO
UNDERTAKE ACTIVITIES THAT ARE TO BE ACCOMPLISHED IN WHOLE OR IN PART
THROUGH CONTRACTS WITH CERTAIN ENTITIES INCLUDING, BUT NOT LIMITED TO,
NOT-FOR-PROFIT ORGANIZATIONS, FOR-PROFIT ORGANIZATIONS, MUNICIPALITIES
OR ANY COMBINATION THEREOF.
6. "PROGRAM PROCUREMENT" MEANS A PROCUREMENT WHICH:
A. IS UNDERTAKEN FOR A BROAD PUBLIC PURPOSE AUTHORIZED BY LAW AND NOT
UNDERTAKEN BY A STATE AGENCY PRIMARILY TO OBTAIN COMMODITIES, SERVICES
OR TECHNOLOGY FOR SUCH AGENCY; AND
B. IS INTENDED TO BENEFIT A COMMUNITY OR A PORTION OF A COMMUNITY; AND
C. IS ACCOMPLISHED IN WHOLE OR IN PART THROUGH A CONTRACT OR CONTRACTS
WITH AN ASSOCIATION, PARTNERSHIP, JOINT VENTURE, FIRM, COMPANY, CORPO-
RATION, PUBLIC CORPORATION, NOT-FOR-PROFIT ORGANIZATION OR A COMBINATION
OF SUCH ENTITIES; AND
D. HAS BEEN GRANTED AN EXEMPTION PURSUANT TO THE PROVISIONS OF SECTION
ONE HUNDRED SEVENTY-NINE-HH OF THIS ARTICLE WHERE SUCH EXEMPTION IS
REQUIRED BY SECTION ONE HUNDRED SEVENTY-NINE-GG OF THIS ARTICLE.
A PROGRAM PROCUREMENT PROVIDES THE PROPOSER OR APPLICANT WITH WIDE
DISCRETION AND LATITUDE IN THE MANNER IN WHICH THE PURPOSE IS TO BE
ACCOMPLISHED WITH FEW SPECIFIC LIMITATIONS ON THE SCOPE OF THE PROPOSAL
OR APPLICATION.
7. "PUBLIC CORPORATION" MEANS A CITY, TOWN, VILLAGE, SCHOOL DISTRICT,
A DISTRICT CORPORATION OR A PUBLIC BENEFIT CORPORATION AS THOSE TERMS
ARE DEFINED IN SECTION SIXTY-SIX OF THE GENERAL CONSTRUCTION LAW.
8. "RESPONSIBLE" OR "RESPONSIBILITY" MEANS THE FINANCIAL ABILITY,
LEGAL CAPACITY, INTEGRITY, AND PAST PERFORMANCE OF A BUSINESS ENTITY AND
AS SUCH TERMS HAVE BEEN INTERPRETED RELATIVE TO PUBLIC PROCUREMENTS.
9. "RESPONSIVE" MEANS A PROPOSER OR APPLICANT MEETING THE MINIMUM
SPECIFICATIONS OR REQUIREMENTS AS PRESCRIBED IN A SOLICITATION ISSUED BY
A STATE AGENCY.
10. "SINGLE SOURCE" MEANS A PROGRAM PROCUREMENT IN WHICH ALTHOUGH TWO
OR MORE PROPOSERS OR APPLICANTS CAN SUPPLY THE REQUIRED GOODS OR
SERVICES, THE STATE AGENCY, UPON WRITTEN FINDINGS SETTING FORTH THE
MATERIAL AND SUBSTANTIAL REASONS THEREFOR, MAY AWARD THE CONTRACT TO ONE
PROPOSER OR APPLICANT OVER ANOTHER. THE STATE AGENCY SHALL DOCUMENT IN
THE PROCUREMENT RECORD THE CIRCUMSTANCES LEADING TO THE SELECTION OF THE
PROPOSER OR APPLICANT, INCLUDING THE ALTERNATIVES CONSIDERED, THE
RATIONALE FOR SELECTING THE SPECIFIC PROPOSER OR APPLICANT AND THE BASIS
UPON WHICH THE STATE AGENCY DETERMINED THAT THE COST WAS REASONABLE.
11. "SOLICITATION DOCUMENT" MEANS THE DOCUMENT ISSUED BY A STATE AGEN-
CY NOTIFYING PROSPECTIVE PROPOSERS OR APPLICANTS THAT THE STATE AGENCY
WISHES TO RECEIVE PROPOSALS OR APPLICATIONS FOR PROVIDING GOODS OR
SERVICES.
12. "SOLE SOURCE" MEANS A PROGRAM PROCUREMENT IN WHICH ONLY ONE PROPO-
SER OR APPLICANT IS CAPABLE OF SUPPLYING THE REQUIRED GOODS OR SERVICES.
13. "SPECIFICATION" OR "REQUIREMENT" MEANS ANY DESCRIPTION OF THE
PHYSICAL OR FUNCTIONAL CHARACTERISTICS OR THE NATURE OF A GOOD OR
SERVICE, ANY DESCRIPTION OF THE SERVICES TO BE PERFORMED, THE GOODS OR
SERVICES TO BE PROVIDED, THE NECESSARY QUALIFICATIONS OF THE PROPOSER OR
APPLICANT, THE CAPACITY AND CAPABILITY OF THE PROPOSER OR APPLICANT TO
COMPLETE THE PROPOSED CONTRACT SUCCESSFULLY, OR THE PROCESS FOR ACHIEV-
ING SPECIFIC RESULTS OR ANTICIPATED OUTCOMES, OR BOTH, OR ANY OTHER
REQUIREMENT NECESSARY TO PERFORM THE WORK. IT MAY INCLUDE A DESCRIPTION
OF ANY OBLIGATORY TESTING, INSPECTION OR PREPARATION FOR DELIVERY AND
USE, AND MAY INCLUDE FEDERALLY REQUIRED PROVISIONS AND CONDITIONS WHERE
THE ELIGIBILITY FOR FEDERAL FUNDS IS CONDITIONED UPON THE INCLUSION OF
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SUCH FEDERALLY REQUIRED PROVISIONS AND CONDITIONS. SPECIFICATIONS SHALL
BE DESIGNED TO ENHANCE COMPETITION.
14. "STATE AGENCY" OR "STATE AGENCIES" MEANS ALL STATE DEPARTMENTS,
BOARDS, COMMISSIONS, OFFICES OR INSTITUTIONS BUT EXCLUDES, HOWEVER, FOR
THE PURPOSES OF SUBDIVISION FIVE OF SECTION THREE HUNDRED FIFTY-FIVE OF
THE EDUCATION LAW, THE STATE UNIVERSITY OF NEW YORK, AND EXCLUDES, FOR
THE PURPOSES OF SUBDIVISION A OF SECTION SIXTY-TWO HUNDRED EIGHTEEN OF
THE EDUCATION LAW, THE CITY UNIVERSITY OF NEW YORK. FURTHERMORE, SUCH
TERM SHALL NOT INCLUDE THE LEGISLATURE OR THE JUDICIARY.
S 179-GG. PROGRAM PROCUREMENTS. THE PROGRAM PROCUREMENT PROCESS SET
FORTH IN THIS ARTICLE, RATHER THAN THE REQUIREMENTS OF ARTICLE ELEVEN OF
THIS CHAPTER, SHALL APPLY TO:
1. PROGRAM PROCUREMENTS OPEN ONLY TO NOT-FOR-PROFIT ORGANIZATIONS OR
PUBLIC CORPORATIONS OR BOTH, AND
2. THOSE PROGRAM PROCUREMENTS OPEN TO PROFIT-SEEKING ENTITIES WHERE
THE STATE AGENCY HAS OBTAINED FROM THE STATE COMPTROLLER, IN ACCORDANCE
WITH SECTION ONE HUNDRED SEVENTY-NINE-HH OF THIS ARTICLE, AN EXEMPTION
FROM THE REQUIREMENTS OF ARTICLE ELEVEN OF THIS CHAPTER.
S 179-HH. REQUEST FOR EXEMPTION. BEFORE THE ISSUANCE OF A SOLICITATION
DOCUMENT, A STATE AGENCY CONDUCTING A PROCUREMENT OPEN TO PROFIT-SEEKING
ENTITIES WHICH THE STATE AGENCY BELIEVES FALLS WITHIN THE MEANING OF A
PROGRAM PROCUREMENT, AS DEFINED IN THIS ARTICLE, SHALL MAKE A WRITTEN
REQUEST TO THE STATE COMPTROLLER FOR AN EXEMPTION FROM THE REQUIREMENTS
OF ARTICLE ELEVEN OF THIS CHAPTER. THE STATE COMPTROLLER SHALL MAKE A
WRITTEN DETERMINATION AS TO WHETHER THE PROPOSED PROCUREMENT FALLS WITH-
IN THE DEFINITION OF A PROGRAM PROCUREMENT AS SET FORTH IN SECTION ONE
HUNDRED SEVENTY-NINE-FF OF THIS ARTICLE AND IS IN THE BEST INTEREST OF
THE STATE, AND SHALL EITHER GRANT OR DENY THE EXEMPTION ON THE BASIS OF
SUCH DETERMINATION. IF THE STATE COMPTROLLER GRANTS A STATE AGENCY AN
EXEMPTION FROM THE REQUIREMENTS OF ARTICLE ELEVEN OF THIS CHAPTER, THE
PROGRAM PROCUREMENT SHALL BE CONDUCTED IN ACCORDANCE WITH THE REQUIRE-
MENTS OF THIS ARTICLE.
S 179-II. PROGRAM PROCUREMENT PROCESS. 1. METHOD OF PROCUREMENT. THE
STATE AGENCY SHALL DOCUMENT IN THE PROCUREMENT RECORD AND IN ADVANCE OF
THE INITIAL RECEIPT OF PROPOSALS/APPLICATIONS THE DETERMINATION OF THE
EVALUATION CRITERIA AND THE PROCESS TO BE USED IN THE DETERMINATION OF
AWARD OR FUNDING, AND THE MANNER IN WHICH THE EVALUATION AND SELECTION
SHALL BE CONDUCTED.
2. PUBLIC NOTICE. ALL PROGRAM PROCUREMENTS BY STATE AGENCIES OR AN
AWARD OR FUNDING IN EXCESS OF FIFTEEN THOUSAND DOLLARS SHALL BE ADVER-
TISED IN THE STATE'S PROCUREMENT OPPORTUNITIES NEWSLETTER IN ACCORDANCE
WITH ARTICLE FOUR-C OF THE ECONOMIC DEVELOPMENT LAW.
3. SOLICITING AND ACCEPTING PROPOSALS OR APPLICATIONS. A SOLICITATION
DOCUMENT ISSUED BY A STATE AGENCY SHALL PRESCRIBE THE MINIMUM SPECIFICA-
TIONS OR REQUIREMENTS THAT MUST BE MET TO BE CONSIDERED RESPONSIVE AND
SHALL DESCRIBE AND DISCLOSE THE GENERAL MANNER IN WHICH THE EVALUATION
AND SELECTION SHALL BE CONDUCTED. WHERE APPROPRIATE, THE SOLICITATION
DOCUMENT SHALL IDENTIFY THE RELATIVE IMPORTANCE OR WEIGHT OF COST AND
THE OVERALL TECHNICAL CRITERIA TO BE CONSIDERED BY A STATE AGENCY IN
MAKING A PROGRAM PROCUREMENT DETERMINATION.
4. SELECTION AND CONTRACT AWARD. A. SELECTION AND CONTRACT AWARD SHALL
BE CONSISTENT WITH: (I) THE TERMS OF THE SOLICITATION DOCUMENT ISSUED BY
THE STATE AGENCY; AND (II) THE CONTRACT AWARD METHODOLOGY SET FORTH IN
THE PROCUREMENT RECORD BEFORE THE INITIAL RECEIPT OF PROPOSALS OR APPLI-
CATIONS.
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B. PROGRAM PROCUREMENT AWARDS SHALL BE MADE TO A PROPOSER OR APPLICANT
ON THE BASIS OF TECHNICAL MERIT WITH THE CONSIDERATION GIVEN TO THE
REASONABLENESS OF COSTS. THE CONTRACT AWARD OR AWARDS OR FUNDING SHALL
BE ALLOCATED TO THE HIGHEST RANKED PROPOSAL OR PROPOSALS. NOTHING IN
THIS SECTION, HOWEVER, SHALL BE DEEMED TO PROHIBIT A STATE AGENCY FROM
EVALUATING COST SEPARATELY IN ITS SELECTION AND CONTRACT AWARD.
C. A PROCUREMENT RECORD SHALL BE MAINTAINED FOR EACH PROGRAM PROCURE-
MENT IDENTIFYING, WITH SUPPORTING DOCUMENTATION, DECISIONS MADE BY THE
STATE AGENCY DURING THE PROCUREMENT PROCESS.
D. SELECTION AND CONTRACT AWARD SHALL BE A WRITTEN DETERMINATION IN
THE PROCUREMENT RECORD MADE BY THE STATE AGENCY.
E. PRIOR TO MAKING A PROGRAM PROCUREMENT AWARD, THE STATE AGENCY SHALL
MAKE A DETERMINATION OF THE RESPONSIBILITY OF THE PROPOSER OR APPLICANT.
5. REDUCTION OF AWARD. A STATE AGENCY MAY REDUCE THE MONETARY AMOUNT
OF THE AWARDS MADE UNDER A PROGRAM PROCUREMENT IF THE STATE AGENCY
RESERVES THE RIGHT TO MAKE SUCH A REDUCTION IN THE SOLICITATION DOCUMENT
AND SUCH REDUCTION IS CONSISTENT WITH A PREDEFINED METHODOLOGY SET FORTH
IN THE PROCUREMENT RECORD PRIOR TO THE RECEIPT OF INITIAL PROPOSALS OR
APPLICATIONS.
6. DISCRETIONARY PROGRAM PROCUREMENT AWARDS. A STATE AGENCY MAY MAKE A
PROGRAM PROCUREMENT AWARD IN AN AMOUNT NOT EXCEEDING FIFTY THOUSAND
DOLLARS WITHOUT A FORMAL COMPETITIVE PROCESS. THE STATE AGENCY SHALL,
HOWEVER, DOCUMENT THAT THE AMOUNT OF THE AWARD OR FUNDING IS REASONABLE.
7. CONTRACT AWARDS. A. CONTRACT AWARDS SHALL BE MADE ON THE BASIS OF
HIGHEST RANK IN ACCORDANCE WITH THE SELECTION AND AWARD METHODOLOGY
ESTABLISHED IN ACCORDANCE WITH THE PROGRAM REQUIREMENTS SET FORTH BY
EACH AGENCY FOR SUCH PROGRAM.
B. SINGLE OR SOLE SOURCE CONTRACT AWARDS, OR CONTRACT AWARDS MADE TO
MEET EMERGENCIES ARISING FROM UNFORESEEN CAUSES, MAY BE MADE WITHOUT A
FORMAL COMPETITIVE PROCESS AND SHALL ONLY BE MADE UNDER UNUSUAL CIRCUM-
STANCES AND SHALL BE BASED UPON A DETERMINATION BY THE STATE AGENCY THAT
THE SPECIFICATIONS OR REQUIREMENTS FOR SUCH AWARD HAVE BEEN DESIGNED IN
A FAIR AND EQUITABLE MANNER. THE STATE AGENCY SHALL DOCUMENT IN THE
PROCUREMENT RECORD, SUBJECT TO REVIEW BY THE STATE COMPTROLLER, THE
BASIS FOR A DETERMINATION TO MAKE AN AWARD TO A SINGLE SOURCE OR SOLE
SOURCE, OR THE NATURE OF THE EMERGENCY GIVING RISE TO THE AWARD.
8. CONTRACTS. ANY CONTRACT RESULTING FROM A PROGRAM PROCUREMENT
AWARDED PURSUANT TO THE PROVISIONS OF THIS ARTICLE THAT INCLUDES FUNDING
FOR COMMODITIES OR CONSTRUCTION SERVICES IN EXCESS OF FIFTY THOUSAND
DOLLARS SHALL INCLUDE CONTRACT LANGUAGE REQUIRING THE CONTRACTOR TO
ACQUIRE SUCH COMMODITIES AND/OR CONSTRUCTION SERVICES PURSUANT TO A
COMPETITIVE BIDDING PROCESS.
9. REVIEW BY THE OFFICE OF THE STATE COMPTROLLER. REVIEW BY THE OFFICE
OF THE STATE COMPTROLLER SHALL BE IN ACCORDANCE WITH SECTION ONE HUNDRED
TWELVE OF THIS CHAPTER.
S 2. Subdivision 7 of section 160 of the state finance law, as added
by chapter 83 of the laws of 1995, is amended to read as follows:
7. "Service" or "services" means, except with respect to contracts for
state printing, the performance of a task or tasks and may include a
material good or a quantity of material goods, and which is the subject
of any purchase or other exchange. For the purposes of this article,
technology shall be deemed a service. Services, as defined in this arti-
cle, shall not apply to those contracts for (I) architectural, engineer-
ing or surveying services, [or those contracts approved in accordance
with] (II) SERVICES PROVIDED BY A NOT-FOR-PROFIT ORGANIZATION IN ACCORD-
ANCE WITH THE PROVISIONS OF article eleven-B of this chapter, OR (III)
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SERVICES OBTAINED THROUGH PROGRAM PROCUREMENTS IN ACCORDANCE WITH ARTI-
CLE ELEVEN-C OF THIS CHAPTER.
S 3. Subdivision 12 of section 163 of the state finance law, as added
by chapter 83 of the laws of 1995, is amended to read as follows:
12. Review by the office of the state comptroller. Review by the
office of the state comptroller shall be in accordance with section one
hundred twelve of this chapter. WHERE THE CONTRACTING AGENCY HAS NOT
COMPLIED WITH ONE OR MORE PROVISIONS OF THIS ARTICLE, THE COMPTROLLER
MAY APPROVE THE AWARDED CONTRACT IF:
A. THE CONTRACTING AGENCY DETERMINES AND CERTIFIES, BASED UPON A
PREPONDERANCE OF THE EVIDENCE DOCUMENTED IN THE PROCUREMENT RECORD, THAT
THE NONCOMPLIANCE DID NOT PREJUDICE OR FAVOR ANY VENDOR OR POTENTIAL
VENDOR AND THAT A NEW PROCUREMENT WOULD NOT BE IN THE BEST INTEREST OF
THE STATE; AND
B. THE STATE COMPTROLLER CONCURS IN SUCH DETERMINATION.
S 4. Section 163 of the state finance law is amended by adding a new
subdivision 13-a to read as follows:
13-A. PILOT PROCUREMENT PROJECTS. A. WHEN THE COMMISSIONER OR A STATE
AGENCY DEVELOPS A PROCUREMENT METHOD NOT AUTHORIZED BY THIS ARTICLE, THE
COMMISSIONER OR STATE AGENCY IS HEREBY AUTHORIZED TO USE SUCH METHOD ON
A LIMITED BASIS FOR A SPECIFIC CONTRACT AWARD IF: (I) THE COMMISSIONER
OR STATE AGENCY HAS MADE A DETERMINATION, DOCUMENTED IN THE PROCUREMENT
RECORD, THAT SUCH A PILOT PROCUREMENT METHOD WOULD BETTER SERVE THE
INTEREST OF THE STATE THAN OTHER METHODS CURRENTLY AVAILABLE UNDER THIS
SECTION; AND (II) THE PILOT PROCUREMENT METHOD IS APPLICABLE ON A FAIR
AND EQUITABLE BASIS.
B. WHEN USING A PROCUREMENT METHOD AUTHORIZED BY PARAGRAPH A OF THIS
SUBDIVISION, THE COMMISSIONER OR STATE AGENCY SHALL DOCUMENT, IN THE
PROCUREMENT RECORD AND IN ADVANCE OF THE INITIAL RECEIPT OF OFFERS, THE
DETERMINATION OF THE EVALUATION CRITERIA, WHICH WHENEVER POSSIBLE, SHALL
BE QUANTIFIABLE, AND THE PROCESS TO BE USED IN THE DETERMINATION OF THE
SPECIFIC CONTRACT AWARD AND THE MANNER IN WHICH THE EVALUATION PROCESS
AND SELECTION SHALL BE CONDUCTED.
C. PRIOR TO THE COMMENCEMENT OF THE PROCUREMENT, THE COMPTROLLER SHALL
AGREE THAT SUCH PROCUREMENT METHOD BETTER SERVES THE INTERESTS OF THE
STATE AND CAN BE APPLIED ON A FAIR AND EQUITABLE BASIS. FOR EACH SUCH
PILOT PROCUREMENT PROJECT AWARD, THE COMMISSIONER OR THE STATE AGENCY,
AS APPLICABLE, SHALL SUBMIT TO THE COMPTROLLER NOT LATER THAN THE
MID-POINT OF THE TERM OF THE RESULTANT CONTRACT A REPORT ASSESSING THE
SUCCESS OR FAILURE OF THE PILOT PROCUREMENT METHOD.
S 5. This act shall take effect immediately and shall apply to any
procurement initiated on or after such date; provided, however, that the
amendments to section 163 of the state finance law made by sections
three and four of this act shall not affect the repeal of such section
as provided in subdivision 5 of section 362 of chapter 83 of the laws of
1995, as amended, and shall be deemed repealed therewith.