Authorizes certain business enterprise subcontractors who seek to do work with not-for-profit corporations to receive MWBE certification if certain criteria is met; imposes a $50,001 limit on the provision of such services or work; makes related provisions.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5348
SPONSOR: Rajkumar TITLE OF BILL:
An act to amend the executive law, in relation to exempting certain
business enterprise subcontractors who seek to do work with not-for-pro-
fit corporations from certain requirements
PURPOSE OR GENERAL IDEA OF BILL:
To provide an alternative method for the MWBE certification of small, ad
hoc, subcontractors of non-profits.
SUMMARY OF PROVISIONS:
Section 1 Amends Section 314 by adding a new subdivision, 2-d, directing
the Director of Division of Minority and Women's Business Development to
create a procedure, in lieu of full MWBE certification, for a subcon-
tractor who apply to do work for a non-profit, and reaffirms the
requirements of an MWBE eligible entity.
Section 2 is the enacting clause.
DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION (IF APPLICABLE):JUSTIFICATION:
As New York State continues to fulfill its mission of increasing diver-
sity in its contracting, it unintentionally creates-barriers for some of
the people for whom it tries to provide opportunities, namely new immi-
grant small business owners. Additionally, the lucrative contracting
opportunities provided by full MWBE certification has an unintentional
effect of discouraging certified firms from taking on small dollar
contracts. Nonprofit providers have expressed difficulty meeting their
MWBE subcontracting requirements, even though their subcontractors would
meet MWBE certification requirements if they applied.
This necessitates the creation of a process outside of the standard,
full MWBE certification, but one that still encourages MWBE contracting
and acts as a pathway towards full certification. Limited to three
times in a 12-month period, this legislation permits the MWBE to accept
ad-hoc, verification of a non-profit's subcontractors MWBE eligibility
in contracts up to $50,000 in lieu of the full certification process.
By unlocking access to these contracting opportunities, it encourages
smaller contractors to learn the benefits of full certification, and
removes a technical limit on who non-profits can subcontract to.
PRIOR LEGISLATIVE HISTORY:
New bill.
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined.
EFFECTIVE DATE:
This act shall Lake effect immediately
STATE OF NEW YORK
________________________________________________________________________
5348
2025-2026 Regular Sessions
IN ASSEMBLY
February 13, 2025
___________
Introduced by M. of A. RAJKUMAR -- read once and referred to the Commit-
tee on Governmental Operations
AN ACT to amend the executive law, in relation to exempting certain
business enterprise subcontractors who seek to do work with not-for-
profit corporations from certain requirements
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 314 of the executive law is amended by adding a new
2 subdivision 2-d to read as follows:
3 2-d. (a) The director shall establish a procedure enabling the office
4 to accept business enterprise subcontractor verification for minority
5 and women-owned business enterprise applicants who apply to do work for
6 non-for-profit corporations in lieu of requiring such business enter-
7 prise subcontractor to complete the state certification process. The
8 director shall promulgate rules and regulations to set forth criteria
9 for the acceptance of such business enterprise subcontractor certif-
10 ication.
11 (b) All business enterprise subcontractor certifications shall require
12 business enterprises who apply to do work for not-for-profit corpo-
13 rations and seek certification to meet the following standards:
14 (i) have at least fifty-one percent ownership by a minority or a
15 women-owned enterprise and be owned by United States citizens or perma-
16 nent resident noncitizens;
17 (ii) be an enterprise in which the minority and/or women-ownership
18 interest is real, substantial and continuing;
19 (iii) be an enterprise in which the minority and/or women-ownership
20 has and exercises the authority to control independently the day-to-day
21 business decisions of the enterprise;
22 (iv) be an enterprise authorized to do business in this state;
23 (v) be subject to a physical site inspection to verify the fifty-one
24 percent ownership requirement;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08625-01-5
A. 5348 2
1 (vi) be owned by an individual or individuals, whose ownership,
2 control and operation are relied upon for certification, with a personal
3 net worth that does not exceed fifteen million dollars and such other
4 amount as the director shall set forth in regulations, as adjusted annu-
5 ally for inflation according to the consumer price index;
6 (vii) be an enterprise that is a small business pursuant to subdivi-
7 sion twenty of section three hundred ten of this article;
8 (viii) services and/or the work being performed are at a cost of less
9 than fifty thousand one dollars;
10 (ix) have not received such exemption more than three times in the
11 preceding twelve calendar months; and
12 (x) comply with any reporting requirements pursuant to this article.
13 § 2. This act shall take effect immediately, provided however, the
14 amendments to article 15-A of the executive law made by section one of
15 this act shall not affect the expiration of such article and shall be
16 deemed repealed therewith.
