Senate Bill S3995

                                BILL NUMBER:S3995

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 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. Substantially affiliated-owned
entities, as defined by Labor. Law § 220(5)(g), to the federally
debarred contractor may also be debarred so long as they are provided
notice and afforded the opportunity to 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 has
violated the Davis-Bacon Act, the Copeland Act, or the Contract Work
Hours and Safety Standards Act, will be considered in the selection of
a lowest responsible bidder.

Section 3 provides for an effective date 120 days after the bill
becomes law.

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:

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. 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:

This is a new bill.

FISCAL IMPLICATIONS:

None.

EFFECTIVE DATE:

This act shall take effect on the one hundred twentieth day after it
shall have become a law and shall apply to all public work bids and
contracts solicited on or after such effective date. It shall not
apply retroactively to previously issued or existing public work
contracts