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This entry was published on 2023-04-07
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SECTION 313
Opportunities for minority and women-owned business enterprises
Executive (EXC) CHAPTER 18, ARTICLE 15-A
* § 313. Opportunities for minority and women-owned business
enterprises. 1. Goals and requirements for agencies and contractors.
Each agency shall structure procurement procedures for contracts made
directly or indirectly to minority and women-owned business enterprises,
in accordance with the findings of the disparity study, consistent with
the purposes of this article, to attempt to achieve the recommended
results with regard to total annual statewide procurement in the
following industries:

(a) construction industry for certified minority-owned business
enterprises;

(b) construction industry for certified women-owned business
enterprises;

(c) construction related professional services industry for certified
minority-owned business enterprises;

(d) construction related professional services industry for certified
women-owned business enterprises;

(e) non-construction related services industry for certified
minority-owned business enterprises;

(f) non-construction related services industry for certified
women-owned business enterprises;

(g) commodities industry for certified minority-owned business
enterprises;

(h) commodities industry for certified women-owned business
enterprises;

(i) overall agency total dollar value of procurement for certified
minority-owned business enterprises;

(j) overall agency total dollar value of procurement for certified
women-owned business enterprises; and

(k) overall agency total dollar value of procurement for certified
minority, women-owned business enterprises.

1-a. The director shall ensure that each state agency has been
provided with an electronic copy of the disparity study.

1-b. Each agency shall develop and adopt agency-specific goals based
on the findings of the disparity study.

1-c. The goals set pursuant to subdivision one of this section shall
be consistent with the findings of the disparity study.

2. The director shall promulgate rules and regulations based on
subdivision one of this section and the findings of the disparity study
that provide measures and procedures to ensure that certified minority
and women-owned businesses shall be given the opportunity for maximum
feasible participation in the performance of state contracts and to
assist in the agency's identification of those state contracts for which
minority and women-owned certified businesses may best bid to actively
and affirmatively promote and assist their participation in the
performance of state contracts so as to facilitate the agency's
achievement of the maximum feasible portion of the goals for state
contracts to such businesses.

2-a. The director shall promulgate rules and regulations that will
accomplish the following:

(a) provide for the certification and decertification of minority and
women-owned business enterprises for all agencies through a single
process that meets applicable requirements;

(b) require that each contract solicitation document accompanying each
solicitation set forth the expected degree of minority and women-owned
business enterprise participation based, in part, on:

(i) the potential subcontract opportunities available in the prime
procurement contract;

(ii) the availability, as contained within the study, of certified
minority and women-owned business enterprises to respond competitively
to the potential subcontract opportunities as reflected in the
division's directory of certified minority and women-owned business
enterprises; and

(iii) the findings of the disparity study;

(c) require that each agency provide a current list of certified
minority business enterprises to each prospective contractor or direct
them to the division's directory of certified minority and women-owned
business enterprises for such purpose;

(d) allow a contractor that is a certified minority-owned or
women-owned business enterprise to use the work it performs to meet
requirements for use of certified minority-owned or women-owned business
enterprises as subcontractors;

(e) establish criteria for agencies to credit the participation of
minority and women-owned business enterprises towards the achievement of
the minority and women-owned business enterprise participation goals on
a state contract based on the commercially useful function provided by
each minority and women-owned business enterprise on the contract;

(f) provide for joint ventures, which a bidder may count toward
meeting its minority and women-owned business enterprise participation;

(g) consistent with subdivision six of this section, provide for
circumstances under which an agency may waive obligations of the
contractor relating to minority and women-owned business enterprise
participation;

(h) require that an agency verify that minority and women-owned
business enterprises listed in a successful bid are actually
participating to the extent listed in the project for which the bid was
submitted;

(i) provide for the collection of statistical data by each agency
concerning actual minority and women-owned business enterprise
participation;

(j) require each agency to consult the most current disparity study
when calculating agency-wide and contract specific participation goals
pursuant to this article; and

Such rules shall set forth the maximum personal net worth of a
minority group member or woman who may be relied upon to certify a
business as a minority-owned business enterprise or women-owned business
enterprise, and may establish different maximum levels of personal net
worth for minority group members and women on an industry-by-industry
basis for such industries as the director shall determine. Such
regulations relating to the classification of the industry-by-industry
personal net worth thresholds above the fifteen million dollar threshold
shall consider the personal net worth of the owners of both certified
and non-certified businesses, including but not limited to, prime
contractors and subcontractors, as well as any such other factors needed
to establish such thresholds. The provisions of the regulations
pertaining to personal net worth shall, to the extent practicable, be
implemented by June thirtieth, two thousand twenty and shall consider
adjustments for inflation annually on January first of the previous year
according to the consumer price index.

3. Solely for the purpose of providing the opportunity for meaningful
participation by certified businesses in the performance of state
contracts as provided in this section, state contracts shall include
leases of real property by a state agency to a lessee where: the terms
of such leases provide for the construction, demolition, replacement,
major repair or renovation of real property and improvements thereon by
such lessee; and the cost of such construction, demolition, replacement,
major repair or renovation of real property and improvements thereon
shall exceed the sum of one hundred thousand dollars. Reports to the
director pursuant to section three hundred fifteen of this article shall
include activities with respect to all such state contracts. Contracting
agencies shall include or require to be included with respect to state
contracts for the acquisition, construction, demolition, replacement,
major repair or renovation of real property and improvements thereon,
such provisions as may be necessary to effectuate the provisions of this
section in every bid specification and state contract, including, but
not limited to: (a) provisions requiring contractors to make a good
faith effort to solicit active participation by enterprises identified
in the directory of certified businesses; (b) requiring the parties to
agree as a condition of entering into such contract, to be bound by the
provisions of section three hundred sixteen of this article; and (c)
requiring the contractor to include the provisions set forth in
paragraphs (a) and (b) of this subdivision in every subcontract in a
manner that the provisions will be binding upon each subcontractor as to
work in connection with such contract. Provided, however, that no such
provisions shall be binding upon contractors or subcontractors in the
performance of work or the provision of services that are unrelated,
separate or distinct from the state contract as expressed by its terms,
and nothing in this section shall authorize the director or any
contracting agency to impose any requirement on a contractor or
subcontractor except with respect to a state contract.

4. In the implementation of this section, the contracting agency shall
(a) consult the findings contained within the disparity study evidencing
relevant industry specific disparities in the utilization of minority
and women-owned businesses relative to their availability;

(b) implement a program that will enable the agency to evaluate each
contract to determine the appropriate goal for participation by
minority-owned business enterprises and women-owned business
enterprises;

(c) consider where practicable, the severability of construction
projects and other bundled contracts; and

(d) consider compliance with the requirements of any federal law
concerning opportunities for minority and women-owned business
enterprises which effectuates the purpose of this section. The
contracting agency shall determine whether the imposition of the
requirements of any such law duplicate or conflict with the provisions
hereof and if such duplication or conflict exists, the contracting
agency shall waive the applicability of this section to the extent of
such duplication or conflict.

5. (a) Contracting agencies shall administer the rules and regulations
promulgated by the director in a good faith effort to achieve the
maximum feasible participation by minority and women owned business
enterprises adopted pursuant to this article and the regulations of the
director. Such rules and regulations: shall require a contractor to
submit a utilization plan after bids are opened, when bids are required,
but prior to the award of a state contract; shall require the
contracting agency to review the utilization plan submitted by the
contractor and to post the utilization plan and any waivers of
compliance issued pursuant to subdivision six of this section on the
website of the contracting agency; shall require the contracting agency
to notify the contractor in writing within a period of time specified by
the director as to any deficiencies contained in the contractor's
utilization plan; shall require remedy thereof within a period of time
specified by the director; shall require the contractor to submit
compliance reports relating to the operation and implementation of any
utilization plan; shall not allow any automatic waivers but shall allow
a contractor to apply for a partial or total waiver of the minority and
women-owned business enterprise participation requirements pursuant to
subdivisions six and seven of this section; shall allow a contractor to
file a complaint with the director pursuant to subdivision eight of this
section in the event a contracting agency has failed or refused to issue
a waiver of the minority and women-owned business enterprise
participation requirements or has denied such request for a waiver; and
shall allow a contracting agency to file a complaint with the director
pursuant to subdivision nine of this section in the event a contractor
is failing or has failed to comply with the minority and women-owned
business enterprise participation requirements set forth in the state
contract where no waiver has been granted.

(b) The rules and regulations promulgated pursuant to this subdivision
regarding a utilization plan shall provide that where enterprises have
been identified within a utilization plan, a contractor shall attempt,
in good faith, to utilize such enterprise at least to the extent
indicated. A contracting agency may require a contractor to indicate,
within a utilization plan, what measures and procedures he or she
intends to take to comply with the provisions of this article, but may
not require, as a condition of award of, or compliance with, a contract
that a contractor utilize a particular enterprise in performance of the
contract.

(c) The rules and regulations promulgated pursuant to this subdivision
regarding compliance reports shall provide that such reports shall
include a standardized prepayment declaration, to be completed before
each payment to a contractor, in which: (i) a representative of the
contractor lists any business that was or shall be relied upon for
credit toward minority and women-owned business enterprise participation
and states under penalty of perjury that such business or businesses
appeared on the division's directory of certified minority and
women-owned business enterprises at the time of contracting and that
each business performed or shall perform a commercially useful function
on the contract; and (ii) a representative of any business that was or
shall be relied upon for credit toward minority and women-owned business
enterprise participation states under penalty of perjury that it
appeared on the division's directory of certified minority and
women-owned business enterprises at the time of contracting and
performed or shall perform a commercially useful function on the
contract. Such standardized prepayment declarations shall be submitted
electronically on a centralized state registry designated by the
division prior to any payment to a contractor. The rules and regulations
promulgated pursuant to this subdivision may also require the contractor
or subcontractor to submit documentation, as needed, to support any
statements made in such standardized prepayment declarations.

(d) Without limiting other grounds for the disqualification of bids or
proposals on the basis of non-responsibility, a contracting agency may
disqualify the bid or proposal of a contractor as being non-responsible
for failure to remedy notified deficiencies contained in the
contractor's utilization plan within a period of time specified in
regulations promulgated by the director after receiving notification of
such deficiencies from the contracting agency. Where failure to remedy
any notified deficiency in the utilization plan is a ground for
disqualification, that issue and all other grounds for disqualification
shall be stated in writing by the contracting agency. Where the
contracting agency states that a failure to remedy any notified
deficiency in the utilization plan is a ground for disqualification the
contractor shall be entitled to an administrative hearing, on a record,
involving all grounds stated by the contracting agency. Such hearing
shall be conducted by the appropriate authority of the contracting
agency to review the determination of disqualification. A final
administrative determination made following such hearing shall be
reviewable in a proceeding commenced under article seventy-eight of the
civil practice law and rules, provided that such proceeding is commenced
within thirty days of the notice given by certified mail return receipt
requested rendering such final administrative determination. Such
proceeding shall be commenced in the supreme court, appellate division,
third department and such proceeding shall be preferred over all other
civil causes except election causes, and shall be heard and determined
in preference to all other civil business pending therein, except
election matters, irrespective of position on the calendar. Appeals
taken to the court of appeals of the state of New York shall be subject
to the same preference.

6. (a) Where it appears that a contractor cannot, after a good faith
effort, comply with the minority and women-owned business enterprise
participation requirements set forth in a particular state contract, a
contractor may file a written application with the contracting agency
requesting a partial or total waiver of such requirements setting forth
the reasons for such contractor's inability to meet any or all of the
participation requirements together with an explanation of the efforts
undertaken by the contractor to obtain the required minority and
women-owned business enterprise participation. In implementing the
provisions of this section, the contracting agency shall consider the
number and types of minority and women-owned business enterprises
available to provide goods or services required under the contract in
the region in which the state contract is to be performed, the total
dollar value of the state contract, the scope of work to be performed
and the project size and term. If, based on such considerations, the
contracting agency determines there is not a reasonable availability of
contractors on the list of certified business to furnish services for
the project, it shall issue a waiver of compliance to the contractor. In
making such determination, the contracting agency shall first consider
the availability of other business enterprises located in the region and
shall thereafter consider the financial ability of minority and
women-owned businesses located outside the region in which the contract
is to be performed to perform the state contract.

(b) Upon the issuance of all waivers of compliance as provided in
paragraph (a) of this subdivision, the contracting agency shall: (i)
report the issuance of the waiver to the director; and (ii) publish on
the contracting agency's website on a monthly basis, if practicable, but
no less than on a quarterly basis, in a location easily accessible to
the general public: (1) information identifying the contract, including
the value of the contract; (2) the name of the contractor receiving the
waiver; (3) the date of the waiver; (4) whether the waiver was a partial
or total waiver; and (5) the specific contract provisions to which the
waiver applies.

7. For purposes of determining a contractor's good faith effort to
comply with the requirements of this section or to be entitled to a
waiver therefrom the contracting agency shall consider:

(a) whether the contractor has advertised in general circulation
media, trade association publications, and minority-focus and
women-focus media and, in such event, (i) whether or not certified
minority or women-owned businesses which have been solicited by the
contractor exhibited interest in submitting proposals for a particular
project by attending, or having attended, a pre-bid conference, if any,
scheduled by the state agency awarding the state contract with certified
minority and women-owned business enterprises; and

(ii) whether certified businesses which have been solicited by the
contractor have responded in a timely fashion to the contractor's
solicitations for timely competitive bid quotations prior to the
contracting agency's bid date; and

(b) whether the contractor provided timely written notification of
subcontracting opportunities on the state contract to appropriate
certified businesses that appear in the directory of certified
businesses prepared pursuant to paragraph (f) of subdivision three of
section three hundred eleven of this article; and

(c) whether the contractor can reasonably structure the amount of work
to be performed under subcontracts in order to increase the likelihood
of participation by certified businesses.

8. In the event that a contracting agency fails or refuses to issue a
waiver to a contractor as requested within twenty days after having made
application therefor pursuant to subdivision six of this section or if
the contracting agency denies such application, in whole or in part, the
contractor may file a complaint with the director pursuant to section
three hundred sixteen of this article setting forth the facts and
circumstances giving rise to the contractor's complaint together with a
demand for relief. The contractor shall serve a copy of such complaint
upon the contracting agency by personal service or by certified mail,
return receipt requested. The contracting agency shall be afforded an
opportunity to respond to such complaint in writing.

9. If, after the review of a contractor's minority and women-owned
business utilization plan or review of a periodic compliance report and
after such contractor has been afforded an opportunity to respond to a
notice of deficiency issued by the contracting agency in connection
therewith, it appears that a contractor is failing or refusing to comply
with the minority and women-owned business participation requirements as
set forth in the state contract and where no waiver from such
requirements has been granted, the contracting agency may file a written
complaint with the director pursuant to section three hundred sixteen of
this article setting forth the facts and circumstances giving rise to
the contracting agency's complaint together with a demand for relief.
The contracting agency shall serve a copy of such complaint upon the
contractor by personal service or by certified mail, return receipt
requested. The contractor shall be afforded an opportunity to respond to
such complaint in writing.

* NB Repealed December 31, 2024