S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7578
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             December 8, 2021
                                ___________
 
 Introduced  by  Sen. MANNION -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the state finance law, in relation to  preferred  source
   status for entities that provide employment to certain persons
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraphs d, e and f of subdivision 2, subparagraph  (iii)
 of paragraph a and the opening paragraph of paragraph b of subdivision 4
 and  subdivisions  6,  7  and 8 of section 162 of the state finance law,
 paragraphs d and e of subdivision 2 as amended and paragraph f of subdi-
 vision 2 as added by chapter 501 of the laws of 2002, subparagraph (iii)
 of paragraph a and the opening paragraph of paragraph b of subdivision 4
 and subdivisions 6 and 8 as added by chapter 83 of  the  laws  of  1995,
 paragraphs a and d of subdivision 6 as amended by section 164 of subpart
 B  of  part C of chapter 62 of the laws of 2011, paragraph e of subdivi-
 sion 6 as amended by chapter 265 of the laws of 2013, subdivision  7  as
 amended  by  chapter 426 of the laws of 2002 and paragraph a of subdivi-
 sion 8 as amended by chapter 95 of the laws of 2000, are amended and two
 new subdivisions 10 and 11 are added to read as follows:
   d. Commodities and services produced by any qualified charitable  non-
 profit-making  agency for other [severely] disabled persons approved for
 such purposes by the commissioner of education,  or  incorporated  under
 the laws of this state and approved for such purposes by the commission-
 er of education;
   e.  Commodities  and services produced by a qualified veterans' [work-
 shop] ENTITY providing job and employment-skills  training  to  veterans
 where  such a [workshop] ENTITY is operated by the United States depart-
 ment of veterans affairs and is  manufacturing  products  or  performing
 services within this state and where such [workshop] ENTITY  is approved
 for such purposes by the commissioner of education; or
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13840-01-1
 S. 7578                             2
              

 
   f.  Commodities and services produced by any qualified charitable non-
 profit-making [workshop] ENTITY for veterans approved for such  purposes
 by the commissioner of education, or incorporated under the laws of this
 state and approved for such purposes by the commissioner of education.
   (iii) When commodities are available, in the form, function and utili-
 ty  required by, a state agency or political subdivision or public bene-
 fit corporation having their own purchasing agency, and such commodities
 are not available pursuant to subparagraphs (i) and (ii) of  this  para-
 graph,  said  commodities  shall then be purchased from a qualified non-
 profit-making agency for other [severely] disabled persons, a  qualified
 special  employment  program  for  mentally  ill persons, or a qualified
 veterans' [workshop] ENTITY; PROVIDED,  HOWEVER,  THE  PREFERRED  SOURCE
 SHALL PERFORM FIFTY PERCENT OR MORE OF THE WORK;
   When  services  are  available,  in  the  form,  function  and utility
 required by, a state agency or political subdivision or  public  benefit
 corporation  having their own purchasing agency, equal priority shall be
 accorded the services rendered and offered for sale  by  qualified  non-
 profit-making  agencies for the blind and those for the other [severely]
 disabled, by qualified special  employment  programs  for  mentally  ill
 persons  and  by  qualified  veterans'  [workshops]  ENTITIES; PROVIDED,
 HOWEVER, THE PREFERRED SOURCE SHALL PERFORM FIFTY PERCENT OR MORE OF THE
 WORK. In the case of services:
   6. Prices charged by agencies for the blind, other [severely] disabled
 and veterans' [workshops] ENTITY.
   a. Except with respect to the correctional industries program  of  the
 department  of  corrections  and  community supervision, it shall be the
 duty of the commissioner to determine, and from time to time review, the
 prices of all commodities and to  approve  the  price  of  all  services
 provided  by  preferred  sources as specified in this section offered to
 state agencies, political subdivisions or  public  benefit  corporations
 having  their own purchasing office. THE COMMISSIONER'S PRICE REVIEW AND
 APPROVAL SHALL NOT BE REQUIRED FOR ANY PURCHASES BELOW TWO HUNDRED FIFTY
 THOUSAND DOLLARS.
   b. In determining and revising  the  prices  of  such  commodities  or
 services, consideration shall be given to the reasonable costs of labor,
 materials  and  overhead  necessarily incurred by such preferred sources
 under efficient methods  of  procurement,  production,  performance  and
 administration;  however, the prices of such products and services shall
 be as close to prevailing market price as practicable, but in  no  event
 greater  than  fifteen  percent  above[,]  the  prevailing market prices
 [among responsive offerors] for the same or  equivalent  commodities  or
 services.
   c.  Such qualified charitable non-profit-making agencies for the blind
 and other [severely] disabled may make purchases of materials, equipment
 or supplies, except printed material,  from  centralized  contracts  for
 commodities  in  accordance  with  the  conditions  set by the office of
 general services; provided that the qualified charitable non-profit-mak-
 ing agency for the blind or other [severely] disabled shall accept  sole
 responsibility for any payment due the vendor.
   d.  Such qualified charitable non-profit-making agencies for the blind
 and other [severely] disabled may make purchases of materials, equipment
 and supplies directly from the correctional industries program  adminis-
 tered  by  the  commissioner  of  corrections and community supervision,
 subject to such rules as may be established from time to  time  pursuant
 to  the  correction law; provided that the qualified charitable non-pro-
 fit-making agency for the  blind  or  other  [severely]  disabled  shall
 S. 7578                             3
 
 accept  sole  responsibility  for  any  payment  due  the  department of
 corrections and community supervision.
   e.  The  commissioner  of  the  office of children and family services
 shall appoint the New York state commission  for  the  blind,  or  other
 non-profit-making  agency,  other than the agency representing the other
 [severely] disabled, to facilitate  the  distribution  of  orders  among
 qualified non-profit-making charitable agencies for the blind. The state
 commissioner  of  education  shall  appoint  a non-profit-making agency,
 other than the agency representing the blind, to facilitate the distrib-
 ution of orders among qualified  non-profit-making  charitable  agencies
 for   the  other  [severely]  disabled  and  the  veterans'  [workshops]
 ENTITIES. The state commissioner of mental health shall  facilitate  the
 distribution of orders among qualified special employment programs oper-
 ated  or  approved  by  the office of mental health serving mentally ill
 persons.
   f. The commissioner may  request  the  state  comptroller  to  conduct
 audits and examinations to be made of all records, books and data of any
 agency  for  the  blind  or  the  other [severely] disabled, any special
 employment program for mentally ill persons or any veterans' [workshops]
 ENTITY qualified under this section to determine the costs  of  manufac-
 ture  or  the  rendering  of  services  and the manner and efficiency of
 production and administration  of  such  agency  or  special  employment
 program  or  veterans' [workshop] ENTITY with relation to any product or
 services purchased by a state agency or political subdivision or  public
 benefit  corporation  and to furnish the results of such audit and exam-
 ination to the commissioner for such action as he or she may deem appro-
 priate under this section.
   7. Partnering with preferred sources. [The commissioner of the  appro-
 priate appointing agency as identified in paragraph e of subdivision six
 of  this  section,  shall  conduct  one  or more pilot studies whereby a
 private vendor may be accorded preferred source status for  purposes  of
 this  section. The pilot studies shall seek to ascertain the benefits of
 partnerships  between  private  industry  and  those  entities  accorded
 preferred  source  status as specified in this section. Preferred source
 status under a  partnering  arrangement  may]  PRIVATE  VENDORS  MAY  BE
 ACCORDED  PREFERRED SOURCE STATUS BUT only [be accorded] when a proposal
 to a soliciting agency for commodities or services  includes  a  binding
 agreement  with  one  or  more of the entities accorded preferred source
 status under this section. The binding agreement shall provide that:
   (i) The preferred source shall perform the majority of the work neces-
 sary to such offering, and
   (ii) The partnering proposal includes bona fide long  term  employment
 opportunities  for  persons  who  [could  otherwise  be new clients] ARE
 CLIENTS of an entity [previously] accorded preferred source status here-
 in, and
   (iii) The partnering proposal offers the solicited services or commod-
 ities at a price less than the price that otherwise would be charged  by
 [a] THE preferred source.
   8.  [a.  The  commissioner  of the appropriate appointing agency shall
 report by December thirty-first, two thousand four, to the governor, the
 chairperson of the senate finance  committee,  the  chairperson  of  the
 assembly  ways  and  means committee and the director of the budget, the
 results and findings of each pilot study conducted, pursuant to subdivi-
 sion seven of this section, and include  recommendations  for  improving
 partnering with preferred sources.
 S. 7578                             4

   b.]  The  council  shall  report  to  the governor, legislative fiscal
 committees and the director of  the  budget  by  December  thirty-first,
 nineteen  hundred  ninety-five  and thereafter annually, a separate list
 concerning the denial of any application made pursuant to paragraph  (b)
 of  subdivision  three  of  this  section,  the reasons for such denial,
 whether such denial was appealed to  the  commissioner,  and  the  final
 decision by the commissioner on such application.
   10.  FOR  PURPOSES  OF  THIS  SECTION THE TERM "POLITICAL SUBDIVISION"
 SHALL HAVE THE SAME MEANING AS SET FORTH IN SUBDIVISION ONE  OF  SECTION
 ONE  HUNDRED OF THE GENERAL MUNICIPAL LAW AND SHALL INCLUDE ALL "MUNICI-
 PAL CORPORATIONS" AS SUCH TERM IS DEFINED IN THE  OPENING  PARAGRAPH  OF
 SECTION TWO OF THE GENERAL MUNICIPAL LAW.
   11. THE PROVISIONS OF THIS SECTION SHALL APPLY TO ANY GRANTS ISSUED BY
 THE WORKFORCE DEVELOPMENT INITIATIVE AND SHALL REQUIRE UTILIZATION OF AT
 LEAST  FIFTEEN  PERCENT OF PREFERRED SOURCES FOR PROJECTS RECEIVING SUCH
 GRANTS.
   § 2. This act shall take effect immediately.

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  7578--A
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             December 8, 2021
                                ___________
 
 Introduced  by  Sens.  MANNION, JORDAN, PALUMBO, SKOUFIS, THOMAS -- read
   twice and ordered printed, and when printed to  be  committed  to  the
   Committee  on Rules -- recommitted to the Committee on Procurement and
   Contracts in accordance with  Senate  Rule  6,  sec.  8  --  committee
   discharged, bill amended, ordered reprinted as amended and recommitted
   to said committee
 
 AN  ACT  to amend the state finance law, in relation to preferred source
   status for entities that provide employment to certain persons
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. Paragraphs d, e and f of subdivision 2, subparagraph (iii)
 of paragraph a and the opening paragraph of paragraph b of subdivision 4
 and subdivisions 6, 7 and 8 of section 162 of  the  state  finance  law,
 paragraphs d and e of subdivision 2 as amended and paragraph f of subdi-
 vision 2 as added by chapter 501 of the laws of 2002, subparagraph (iii)
 of paragraph a and the opening paragraph of paragraph b of subdivision 4
 and  subdivisions  6  and  8 as added by chapter 83 of the laws of 1995,
 paragraphs a and d of subdivision 6 as amended by section 164 of subpart
 B of part C of chapter 62 of the laws of 2011, paragraph e  of  subdivi-
 sion  6  as amended by chapter 265 of the laws of 2013, subdivision 7 as
 amended by chapter 426 of the laws of 2002 and paragraph a  of  subdivi-
 sion 8 as amended by chapter 95 of the laws of 2000, are amended to read
 as follows:
   d.  Commodities and services produced by any qualified charitable non-
 profit-making agency for other [severely] disabled persons approved  for
 such  purposes  by  the commissioner of education, or incorporated under
 the laws of this state and approved for such purposes by the commission-
 er of education;
   e. Commodities and services produced by a qualified  veterans'  [work-
 shop]  ENTITY  providing  job and employment-skills training to veterans
 where such a [workshop] ENTITY is operated by the United States  depart-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13840-02-2
              

 S. 7578--A                          2
 
 ment  of  veterans  affairs  and is manufacturing products or performing
 services within this state and where such [workshop] ENTITY  is approved
 for such purposes by the commissioner of education; or
   f.  Commodities and services produced by any qualified charitable non-
 profit-making [workshop] ENTITY for veterans approved for such  purposes
 by the commissioner of education, or incorporated under the laws of this
 state and approved for such purposes by the commissioner of education.
   (iii) When commodities are available, in the form, function and utili-
 ty  required by, a state agency or political subdivision or public bene-
 fit corporation having their own purchasing agency, and such commodities
 are not available pursuant to subparagraphs (i) and (ii) of  this  para-
 graph,  said  commodities  shall then be purchased from a qualified non-
 profit-making agency for other [severely] disabled persons, a  qualified
 special  employment  program  for  mentally  ill persons, or a qualified
 veterans' [workshop] ENTITY; PROVIDED,  HOWEVER,  THE  PREFERRED  SOURCE
 SHALL PERFORM FIFTY PERCENT OR MORE OF THE WORK;
   When  services  are  available,  in  the  form,  function  and utility
 required by, a state agency or political subdivision or  public  benefit
 corporation  having their own purchasing agency, equal priority shall be
 accorded the services rendered and offered for sale  by  qualified  non-
 profit-making  agencies for the blind and those for the other [severely]
 disabled, by qualified special  employment  programs  for  mentally  ill
 persons  and  by  qualified  veterans'  [workshops]  ENTITIES; PROVIDED,
 HOWEVER, THE PREFERRED SOURCE SHALL PERFORM FIFTY PERCENT OR MORE OF THE
 WORK. In the case of services:
   6. Prices charged by agencies for the blind, other [severely] disabled
 and veterans' [workshops] ENTITY.
   a. Except with respect to the correctional industries program  of  the
 department  of  corrections  and  community supervision, it shall be the
 duty of the commissioner to determine, and from time to time review, the
 prices of all commodities and to  approve  the  price  of  all  services
 provided  by  preferred  sources as specified in this section offered to
 state agencies, political subdivisions or  public  benefit  corporations
 having  their own purchasing office. THE COMMISSIONER'S PRICE REVIEW AND
 APPROVAL SHALL NOT BE REQUIRED FOR ANY PURCHASES BELOW TWO HUNDRED FIFTY
 THOUSAND DOLLARS.
   b. In determining and revising  the  prices  of  such  commodities  or
 services, consideration shall be given to the reasonable costs of labor,
 materials  and  overhead  necessarily incurred by such preferred sources
 under efficient methods  of  procurement,  production,  performance  and
 administration;  however, the prices of such products and services shall
 be as close to prevailing market price as practicable, but in  no  event
 greater  than  fifteen  percent  above[,]  the  prevailing market prices
 [among responsive offerors] for the same or  equivalent  commodities  or
 services.
   c.  Such qualified charitable non-profit-making agencies for the blind
 and other [severely] disabled may make purchases of materials, equipment
 or supplies, except printed material,  from  centralized  contracts  for
 commodities  in  accordance  with  the  conditions  set by the office of
 general services; provided that the qualified charitable non-profit-mak-
 ing agency for the blind or other [severely] disabled shall accept  sole
 responsibility for any payment due the vendor.
   d.  Such qualified charitable non-profit-making agencies for the blind
 and other [severely] disabled may make purchases of materials, equipment
 and supplies directly from the correctional industries program  adminis-
 tered  by  the  commissioner  of  corrections and community supervision,
 S. 7578--A                          3
 
 subject to such rules as may be established from time to  time  pursuant
 to  the  correction law; provided that the qualified charitable non-pro-
 fit-making agency for the  blind  or  other  [severely]  disabled  shall
 accept  sole  responsibility  for  any  payment  due  the  department of
 corrections and community supervision.
   e. The commissioner of the office  of  children  and  family  services
 shall  appoint  the  New  York  state commission for the blind, or other
 non-profit-making agency, other than the agency representing  the  other
 [severely]  disabled,  to  facilitate  the  distribution of orders among
 qualified non-profit-making charitable agencies for the blind. The state
 commissioner of education  shall  appoint  a  non-profit-making  agency,
 other than the agency representing the blind, to facilitate the distrib-
 ution  of  orders  among qualified non-profit-making charitable agencies
 for  the  other  [severely]  disabled  and  the  veterans'   [workshops]
 ENTITIES.  The  state commissioner of mental health shall facilitate the
 distribution of orders among qualified special employment programs oper-
 ated or approved by the office of mental  health  serving  mentally  ill
 persons.
   f.  The  commissioner  may  request  the  state comptroller to conduct
 audits and examinations to be made of all records, books and data of any
 agency for the blind or  the  other  [severely]  disabled,  any  special
 employment program for mentally ill persons or any veterans' [workshops]
 ENTITY  qualified  under this section to determine the costs of manufac-
 ture or the rendering of services  and  the  manner  and  efficiency  of
 production  and  administration  of  such  agency  or special employment
 program or veterans' [workshop] ENTITY with relation to any  product  or
 services  purchased by a state agency or political subdivision or public
 benefit corporation and to furnish the results of such audit  and  exam-
 ination to the commissioner for such action as he or she may deem appro-
 priate under this section.
   7.  Partnering with preferred sources. [The commissioner of the appro-
 priate appointing agency as identified in paragraph e of subdivision six
 of this section, shall conduct one  or  more  pilot  studies  whereby  a
 private  vendor  may be accorded preferred source status for purposes of
 this section. The pilot studies shall seek to ascertain the benefits  of
 partnerships  between  private  industry  and  those  entities  accorded
 preferred source status as specified in this section.  Preferred  source
 status  under  a  partnering  arrangement  may]  PRIVATE  VENDORS MAY BE
 ACCORDED PREFERRED SOURCE STATUS BUT only [be accorded] when a  proposal
 to  a  soliciting  agency for commodities or services includes a binding
 agreement with one or more of the  entities  accorded  preferred  source
 status under this section. The binding agreement shall provide that:
   (i) The preferred source shall perform the majority of the work neces-
 sary to such offering, and
   (ii)  The  partnering proposal includes bona fide long term employment
 opportunities for persons who  [could  otherwise  be  new  clients]  ARE
 CLIENTS of an entity [previously] accorded preferred source status here-
 in, and
   (iii) The partnering proposal offers the solicited services or commod-
 ities  at a price less than the price that otherwise would be charged by
 [a] THE preferred source.
   8. [a. The commissioner of the  appropriate  appointing  agency  shall
 report by December thirty-first, two thousand four, to the governor, the
 chairperson  of  the  senate  finance  committee, the chairperson of the
 assembly ways and means committee and the director of  the  budget,  the
 results and findings of each pilot study conducted, pursuant to subdivi-
 S. 7578--A                          4

 sion  seven  of  this section, and include recommendations for improving
 partnering with preferred sources.
   b.]  The  council  shall  report  to  the governor, legislative fiscal
 committees and the director of  the  budget  by  December  thirty-first,
 nineteen  hundred  ninety-five  and thereafter annually, a separate list
 concerning the denial of any application made pursuant to paragraph  (b)
 of  subdivision  three  of  this  section,  the reasons for such denial,
 whether such denial was appealed to  the  commissioner,  and  the  final
 decision by the commissioner on such application.
   § 2. This act shall take effect immediately and shall not apply to any
 contracts or requests for proposals issued by government entities before
 such date.

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  7578--B
     Cal. No. 828
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             December 8, 2021
                                ___________
 
 Introduced by Sens. MANNION, CLEARE, JORDAN, PALUMBO, SKOUFIS, THOMAS --
   read  twice  and  ordered printed, and when printed to be committed to
   the Committee on Rules -- recommitted to the Committee on  Procurement
   and  Contracts  in  accordance with Senate Rule 6, sec. 8 -- committee
   discharged, bill amended, ordered reprinted as amended and recommitted
   to said committee -- 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  preferred  source
   status  for  entities  that provide employment to certain persons; and
   providing for the repeal of certain  provisions  upon  the  expiration
   thereof
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraphs d, e and f of subdivision 2, subparagraph  (iii)
 of paragraph a and the opening paragraph of paragraph b of subdivision 4
 of  section 162 of the state finance law, paragraphs d and e of subdivi-
 sion 2 as amended and paragraph f of subdivision 2 as added  by  chapter
 501 of the laws of 2002, subparagraph (iii) of paragraph a and the open-
 ing  paragraph of paragraph b of subdivision 4 as added by chapter 83 of
 the laws of 1995, are amended to read as follows:
   d. Commodities and services produced by any qualified charitable  non-
 profit-making  agency for other [severely] disabled persons approved for
 such purposes by the commissioner of education,  or  incorporated  under
 the laws of this state and approved for such purposes by the commission-
 er of education;
   e.  Commodities  and services produced by a qualified veterans' [work-
 shop] ENTITY providing job and employment-skills  training  to  veterans
 where  such a [workshop] ENTITY is operated by the United States depart-
 ment of veterans affairs and is  manufacturing  products  or  performing
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13840-05-2
              

 S. 7578--B                          2
 
 services within this state and where such [workshop] ENTITY  is approved
 for such purposes by the commissioner of education; or
   f.  Commodities and services produced by any qualified charitable non-
 profit-making [workshop] ENTITY for veterans approved for such  purposes
 by the commissioner of education, or incorporated under the laws of this
 state and approved for such purposes by the commissioner of education.
   (iii) When commodities are available, in the form, function and utili-
 ty  required by, a state agency or political subdivision or public bene-
 fit corporation having their own purchasing agency, and such commodities
 are not available pursuant to subparagraphs (i) and (ii) of  this  para-
 graph,  said  commodities  shall then be purchased from a qualified non-
 profit-making agency for other [severely] disabled persons, a  qualified
 special  employment  program  for  mentally  ill persons, or a qualified
 veterans' [workshop] ENTITY; PROVIDED,  HOWEVER,  THE  PREFERRED  SOURCE
 SHALL PERFORM FIFTY PERCENT OR MORE OF THE WORK;
   When  services  are  available,  in  the  form,  function  and utility
 required by, a state agency or political subdivision or  public  benefit
 corporation  having their own purchasing agency, equal priority shall be
 accorded the services rendered and offered for sale  by  qualified  non-
 profit-making  agencies for the blind and those for the other [severely]
 disabled, by qualified special  employment  programs  for  mentally  ill
 persons  and  by  qualified  veterans'  [workshops]  ENTITIES; PROVIDED,
 HOWEVER, THE PREFERRED SOURCE SHALL PERFORM FIFTY PERCENT OR MORE OF THE
 WORK. In the case of services:
   § 2. Subdivisions  6, 7 and 8 of section 162 of the state finance law,
 subdivisions 6 and 8 as added by chapter 83 of   the   laws   of   1995,
 paragraphs a and d of subdivision 6 as amended by section 164 of subpart
 B  of  part C of chapter 62 of the laws of 2011, paragraph e of subdivi-
 sion 6 as amended by chapter 265 of the laws of 2013, subdivision  7  as
 amended  by  chapter 426 of the laws of 2002 and paragraph a of subdivi-
 sion 8 as amended by chapter 95 of the laws of 2000, are amended to read
 as follows:
   6. Prices charged by agencies for the blind, other [severely] disabled
 and veterans' [workshops] ENTITY.
   a. Except with respect to the correctional industries program  of  the
 department  of  corrections  and  community supervision, it shall be the
 duty of the commissioner to determine, and from time to time review, the
 prices of all commodities and to  approve  the  price  of  all  services
 provided  by  preferred  sources as specified in this section offered to
 state agencies, political subdivisions or  public  benefit  corporations
 having  their own purchasing office. THE COMMISSIONER'S PRICE REVIEW AND
 APPROVAL SHALL NOT BE REQUIRED FOR ANY PURCHASES BELOW ONE HUNDRED THOU-
 SAND DOLLARS.
   b. In determining and revising  the  prices  of  such  commodities  or
 services, consideration shall be given to the reasonable costs of labor,
 materials  and  overhead  necessarily incurred by such preferred sources
 under efficient methods  of  procurement,  production,  performance  and
 administration;  however, the prices of such products and services shall
 be as close to prevailing market price as practicable, but in  no  event
 greater  than  fifteen  percent  above[,]  the  prevailing market prices
 [among responsive offerors] for the same or  equivalent  commodities  or
 services.
   c.  Such qualified charitable non-profit-making agencies for the blind
 and other [severely] disabled may make purchases of materials, equipment
 or supplies, except printed material,  from  centralized  contracts  for
 commodities  in  accordance  with  the  conditions  set by the office of
 S. 7578--B                          3
 
 general services; provided that the qualified charitable non-profit-mak-
 ing agency for the blind or other [severely] disabled shall accept  sole
 responsibility for any payment due the vendor.
   d.  Such qualified charitable non-profit-making agencies for the blind
 and other [severely] disabled may make purchases of materials, equipment
 and supplies directly from the correctional industries program  adminis-
 tered  by  the  commissioner  of  corrections and community supervision,
 subject to such rules as may be established from time to  time  pursuant
 to  the  correction law; provided that the qualified charitable non-pro-
 fit-making agency for the  blind  or  other  [severely]  disabled  shall
 accept  sole  responsibility  for  any  payment  due  the  department of
 corrections and community supervision.
   e. The commissioner of the office  of  children  and  family  services
 shall  appoint  the  New  York  state commission for the blind, or other
 non-profit-making agency, other than the agency representing  the  other
 [severely]  disabled,  to  facilitate  the  distribution of orders among
 qualified non-profit-making charitable agencies for the blind. The state
 commissioner of education  shall  appoint  a  non-profit-making  agency,
 other than the agency representing the blind, to facilitate the distrib-
 ution  of  orders  among qualified non-profit-making charitable agencies
 for  the  other  [severely]  disabled  and  the  veterans'   [workshops]
 ENTITIES.  The  state commissioner of mental health shall facilitate the
 distribution of orders among qualified special employment programs oper-
 ated or approved by the office of mental  health  serving  mentally  ill
 persons.
   f.  The  commissioner  may  request  the  state comptroller to conduct
 audits and examinations to be made of all records, books and data of any
 agency for the blind or  the  other  [severely]  disabled,  any  special
 employment program for mentally ill persons or any veterans' [workshops]
 ENTITY  qualified  under this section to determine the costs of manufac-
 ture or the rendering of services  and  the  manner  and  efficiency  of
 production  and  administration  of  such  agency  or special employment
 program or veterans' [workshop] ENTITY with relation to any  product  or
 services  purchased by a state agency or political subdivision or public
 benefit corporation and to furnish the results of such audit  and  exam-
 ination to the commissioner for such action as he or she may deem appro-
 priate under this section.
   7.  Partnering with preferred sources. [The commissioner of the appro-
 priate appointing agency as identified in paragraph e of subdivision six
 of this section, shall conduct one  or  more  pilot  studies  whereby  a
 private  vendor  may be accorded preferred source status for purposes of
 this section. The pilot studies shall seek to ascertain the benefits  of
 partnerships  between  private  industry  and  those  entities  accorded
 preferred source status as specified in this section.  Preferred  source
 status  under  a  partnering  arrangement  may]  PRIVATE  VENDORS MAY BE
 ACCORDED PREFERRED SOURCE STATUS BUT only [be accorded] when a  proposal
 to  a  soliciting  agency for commodities or services includes a binding
 agreement with one or more of the  entities  accorded  preferred  source
 status under this section. The binding agreement shall provide that:
   (i) The preferred source shall perform the majority of the work neces-
 sary to such offering, and
   (ii)  The  partnering proposal includes bona fide long term employment
 opportunities for persons who  [could  otherwise  be  new  clients]  ARE
 CLIENTS of an entity [previously] accorded preferred source status here-
 in, and
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   (iii) The partnering proposal offers the solicited services or commod-
 ities  at a price less than the price that otherwise would be charged by
 [a] THE preferred source.
   8.  [a.  The  commissioner  of the appropriate appointing agency shall
 report by December thirty-first, two thousand four, to the governor, the
 chairperson of the senate finance  committee,  the  chairperson  of  the
 assembly  ways  and  means committee and the director of the budget, the
 results and findings of each pilot study conducted, pursuant to subdivi-
 sion seven of this section, and include  recommendations  for  improving
 partnering with preferred sources.
   b.]  The  council  shall  report  to  the governor, legislative fiscal
 committees and the director of  the  budget  by  December  thirty-first,
 nineteen  hundred  ninety-five  and thereafter annually, a separate list
 concerning the denial of any application made pursuant to paragraph  (b)
 of  subdivision  three  of  this  section,  the reasons for such denial,
 whether such denial was appealed to  the  commissioner,  and  the  final
 decision by the commissioner on such application.
   §  3.  The state procurement council shall submit a report by December
 31, 2024, to the governor, the speaker of the assembly, and  the  tempo-
 rary  president  of the senate on the direct labor workforce employed in
 the provision of preferred source commodities  and  services,  including
 but  not  limited  to objectives for direct labor to be provided under a
 preferred source agreement by persons who are blind or  by  people  with
 disabilities, participation levels of persons who are blind or by people
 with disabilities in preferred source contracts, and recommendations for
 improving partnering with preferred sources.
   § 4. This act shall take effect immediately; provided that section one
 of  this  act shall expire and be deemed repealed three years after such
 effective date; and provided further that this act shall  not  apply  to
 any  contracts  or  requests for proposals issued by government entities
 before such date.