S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8621
 
                             I N  S E N A T E
 
                             February 22, 2024
                                ___________
 
 Introduced  by  Sen.  WEBB  --  read twice and ordered printed, and when
   printed to be committed to the Committee on Procurement and Contracts
 
 AN ACT to amend the state finance law,  in  relation  to  providing  for
   prompt  payment  by contractors receiving public funds of amounts owed
   to small businesses and minority-owned business enterprises

   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 section
 149 to read as follows:
   § 149. PAYMENTS BY CONTRACTORS TO SMALL BUSINESSES AND  MINORITY-OWNED
 BUSINESS ENTERPRISE SUBCONTRACTORS. 1. FOR THE PURPOSES OF THIS SECTION:
   (A) "COVERED PROJECT" MEANS A PROJECT WHICH IS PAID FOR IN WHOLE OR IN
 PART  OUT  OF PUBLIC FUNDS AS SUCH TERM IS DEFINED IN THIS SECTION WHERE
 THE AMOUNT OF ALL SUCH PUBLIC FUNDS, WHEN AGGREGATED, IS AT LEAST THIRTY
 PERCENT OF THE TOTAL PROJECT COSTS AND WHERE SUCH PROJECT COSTS ARE OVER
 FIVE MILLION DOLLARS.
   (B) "PAID FOR IN WHOLE OR IN PART OUT OF PUBLIC FUNDS"  MEANS  ANY  OF
 THE FOLLOWING:
   (I)  THE PAYMENT OF MONEY, BY A PUBLIC ENTITY, OR A THIRD PARTY ACTING
 ON BEHALF OF AND FOR THE BENEFIT OF A PUBLIC ENTITY, DIRECTLY TO  OR  ON
 BEHALF  OF THE CONTRACTOR, SUBCONTRACTOR, DEVELOPER OR OWNER THAT IS NOT
 SUBJECT TO REPAYMENT; OR
   (II) THE SAVINGS ACHIEVED FROM FEES, RENTS, INTEREST RATES,  OR  OTHER
 LOAN  COSTS,  OR  INSURANCE COSTS THAT ARE LOWER THAN MARKET RATE COSTS;
 SAVINGS FROM REDUCED TAXES AS A RESULT OF TAX CREDITS,  TAX  ABATEMENTS,
 TAX EXEMPTIONS OR TAX INCREMENT FINANCING; SAVINGS FROM PAYMENTS IN LIEU
 OF  TAXES; AND ANY OTHER SAVINGS FROM REDUCED, WAIVED, OR FORGIVEN COSTS
 THAT WOULD HAVE OTHERWISE BEEN AT A HIGHER OR MARKET RATE  BUT  FOR  THE
 INVOLVEMENT OF THE PUBLIC ENTITY.
   (C)  "CONTRACT"  MEANS  AN  ENFORCEABLE  AGREEMENT  ENTERED  INTO BY A
 CONTRACTOR AND A SUBCONTRACTOR.
   (D) "CONTRACTOR" MEANS ANY PERSON, PARTNERSHIP, FIRM, CORPORATION,  OR
 ASSOCIATION:
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD14364-01-4
              

 S. 8621                             2
 
   (I)  SELLING  MATERIALS, EQUIPMENT, OR SUPPLIES OR LEASING PROPERTY OR
 EQUIPMENT TO A STATE AGENCY;
   (II) CONSTRUCTING, RECONSTRUCTING, REHABILITATING, OR REPAIRING BUILD-
 INGS OR HIGHWAYS FOR, OR ON BEHALF OF, A STATE AGENCY; OR
   (III)  RENDERING  OR  PROVIDING SERVICES PURSUANT TO A CONTRACT WITH A
 STATE AGENCY.
   (E) "SUBCONTRACTOR" MEANS A PERSON ENGAGED BY A CONTRACTOR OR  ANOTHER
 SUBCONTRACTOR TO PERFORM A PORTION OF THE CONTRACTOR'S OBLIGATIONS UNDER
 A CONTRACT.
   (F)  "SMALL  BUSINESS  CONCERN"  OR  "SMALL BUSINESS" MEANS A BUSINESS
 WHICH IS RESIDENT IN THIS STATE, INDEPENDENTLY OWNED AND  OPERATED,  NOT
 DOMINANT IN ITS FIELD AND EMPLOYS ONE HUNDRED OR LESS PERSONS.
   (G)  "MINORITY-OWNED BUSINESS ENTERPRISE" HAS THE MEANING SET FORTH IN
 SUBDIVISION SEVEN OF SECTION THREE HUNDRED TEN OF THE EXECUTIVE LAW.
   2. WITHIN SEVEN CALENDAR DAYS OF THE RECEIPT OF ANY PAYMENT FROM STATE
 AGENCIES, THE CONTRACTOR RECEIVING PAYMENT FOR A COVERED  PROJECT  SHALL
 PAY  EACH OF THEIR SMALL BUSINESS AND MINORITY-OWNED BUSINESS ENTERPRISE
 CONTRACTORS AND/OR SUBCONTRACTORS THE PROCEEDS FROM THE PAYMENT  REPRES-
 ENTING  THE  VALUE OF THE WORK PERFORMED AND/OR FURNISHED BY THE SUBCON-
 TRACTOR AND  REFLECTING  THE  PERCENTAGE  OF  THE  SUBCONTRACTOR'S  WORK
 COMPLETED  OR  THE SUPPLIED IN THE REQUISITION APPROVED BY THE OWNER AND
 BASED UPON THE ACTUAL VALUE OF THE SUBCONTRACT OR PURCHASE ORDER LESS AN
 AMOUNT NECESSARY TO SATISFY ANY CLAIMS, LIENS OR JUDGMENTS  AGAINST  THE
 SUBCONTRACTOR  OR  WHICH  HAVE NOT BEEN SUITABLY DISCHARGED AND LESS ANY
 RETAINED AMOUNT AS HEREAFTER DESCRIBED. THE CONTRACTOR RECEIVING PAYMENT
 FOR A COVERED PROJECT SHALL ALSO GENERATE INVOICES NO LATER  THAN  SEVEN
 DAYS OF DATE OF SERVICE. INVOICE SERVICE PERIOD AND DATE OF PAYMENT FROM
 RECEIPT  OF UNDISPUTED INVOICE SHOULD NOT EXCEED THIRTY DAYS. FAILURE BY
 THE CONTRACTOR TO MAKE ANY PAYMENT, INCLUDING ANY REMAINING  AMOUNTS  OF
 THE  CONTRACT  BALANCE  OR GENERATE INVOICES NO LATER THAN SEVEN DAYS OF
 DATE OF SERVICE AS HEREINAFTER  DESCRIBED,  TO  ANY  SMALL  BUSINESS  OR
 MINORITY-OWNED  BUSINESS ENTERPRISE SUBCONTRACTOR OR WITHIN SEVEN CALEN-
 DAR DAYS OF THE RECEIPT OF ANY PAYMENT FROM STATE AGENCIES SHALL  RESULT
 IN  THE  COMMENCEMENT  AND  ACCRUAL  OF  INTEREST ON AMOUNTS DUE TO SUCH
 SUBCONTRACTOR OR FOR THE PERIOD BEGINNING ON THE DAY IMMEDIATELY FOLLOW-
 ING THE EXPIRATION OF SUCH SEVEN CALENDAR DAY PERIOD AND ENDING  ON  THE
 DATE  ON  WHICH PAYMENT IS MADE BY THE CONTRACTOR TO SUCH SUBCONTRACTOR.
 SUCH INTEREST SHALL BE THE SOLE RESPONSIBILITY OF  THE  CONTRACTOR,  AND
 SHALL  BE  PAID AT THE RATE OF INTEREST IN EFFECT ON THE DATE PAYMENT IS
 MADE BY THE CONTRACTOR.
   § 2. This act shall take effect immediately.