Senate Bill S3382

                                BILL NUMBER:S3382

TITLE OF BILL:

An act to amend the labor law and the general municipal law, in
relation to reciprocity of debarments imposed under the federal
Davis-Bacon Act

PURPOSE:

The purpose of the bill is to ensure that those contractors who are
debarred on the federal level under the Davis-Bacon Act for wage
payment violations, are unable to bid on state public work contracts;
this legislation would close a loophole in the existing law. Under the
current law, contractors who have been debarred from federal job sites
are considered on equal footing with law-abiding contractors.  This
bill would remedy this gross inequity by granting reciprocity to
debarments imposed by the federal government on contractors who have
violated the Davis-Bacon Act. New York courts have long settled that
the right to bid on a public work contract is not a property right.
This privilege to bid must be subject to certain restrictions, one of
which should be the ability of the bidder to comply with certain
prevailing wage provisions.

SUMMARY OF PROVISIONS:

              

Section 1 of the bill amends § 220-b of the Labor law so that any
contractor who has been debarred from federal job sites for having
disregarded obligations to employees under the Davis-Bacon Act shall
also be debarred under the Labor Law from bidding on or being awarded
similar contracts on public work job sites sponsored by the State or
any of its political subdivisions. The contractor may appeal such
determination to the Department of Labor (DOL).

Section 2 of the bill would add a new subdivision 1-c to section 103
of the general municipal law so that whether or not a contractor is
debarred under the David-Bacon Act will be considered in the selection
of a lowest responsible bidder. This provision will come into play in
the case where a contractor has appealed to DOL and been removed from
the state debarment list; the entity awarding the contract will still
be able to consider the circumstances of the federal debarment.

Section 3 provides for an immediate effective date and that this shall
just apply prospectively.

EXISTING LAW:

As stated above, under the current law, contractors who have been
debarred from federal job sites are considered on equal footing with
law-abiding contractors.

JUSTIFICATION:

Under Article 8 of the Labor Law, contractors or subcontractors who
engage in a public work project sponsored by the State of New York or
any of its political subdivisions are required to pay their laborers,
workers and material men not less than the prevailing rate of wage.


Recent studies indicate that fraud in the construction industry in New
York State has reached epidemic proportions. Dishonest contractors, in
an effort to cut corners and save on labor costs, have engaged in a
number of schemes to avoid paying workers the wage to which they are
statutorily entitled. They include the kickback of wages, dual
payrolls and cash-off-the books schemes.

Under the existing law, a contractor may he debarred from
participation in public work projects if the Bureau of Public Works
finds that the contractor has knowingly committed two violations of
the prevailing wage law within a six-year period, or one violation
relating to the falsification of payroll records or the kickback of
wages or supplements. Debarments are also imposed when a person or
corporation, or any officer or shareholder who owns or controls at
least ten percent of the outstanding stock of such corporation has
been convicted of any of an enumerated list of felonies for conduct
relating to obtaining, performing or attempting to perform a public
work contract with the state, any municipal corporation, public
benefit corporation or public body. Its federal counterpart, the
Davis-Bacon Act, imposes a similar penalty on contractors who are
found to have disregarded their obligations to employees under federal
wage-and-hour laws. At the present time, however, New York Labor Law
fails to recognize debarments imposed by the United States Department
of Labor. Working at a public work job site is a privilege, not a
right. New Yorkers are entitled to expect the highest standard of
integrity from contractors who bid on these projects.

Under this legislation, debarments would run while federal debarment
is in effect and would apply prospectively.

LEGISLATIVE HISTORY:

2010 Session - New Bill
2011 Session - S. 5659-B - referred to Labor Committee
2012 Session - S. 5659-C - advanced to Third read calendar and
recommitted to Rules.
2013 Session - S.2860 -advanced to Third read calendar and recommitted
to Rules.
2014 Session - S.2860 - no action

FISCAL IMPLICATIONS:

None to State

LOCAL FISCAL IMPLICATIONS:

None

EFFECTIVE DATE:

Immediately and shall apply prospectively to all public works
contracts.