Authorizes the director of the division of minority and women's business development and the mayor of the city of New York to enter into a memorandum of understanding to allow reciprocity between the state and New York City for businesses that are certified as minority and women-owned business enterprises.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A10324A
SPONSOR: Rules (Septimo) TITLE OF BILL:
An act to amend the executive law, in relation to reciprocal minority
and women-owned business enterprise certification
SUMMARY OF PROVISIONS:
This act contains two sections.
Section one of the act would amend subdivision 2-a of section 314 of the
Executive Law by adding a new paragraph (d), which would provide that
the Director of the Division of Minority and Women's Business Develop-
ment of the New York State Department of Economic Development (better
known as Empire State Development("ESD")) and the Mayor of a city with a
population greater than 1,000,000 persons may enter into a memorandum of
understanding providing for the reciprocal acceptance of minority and
women-owned business enterprise ("MWBE") certification between an MWBE
program operated by such city and the New York State MWBE program oper-
ated by ESD. This paragraph would authorize this memorandum of under-
standing to include one or more exemptions where such exemptions are in
the best interest of both programs. This paragraph would also clarify
that this memorandum of understanding would not restrict each program
from amending their respective certification standards and processes.
Section two of the act provides that the act would take effect 270 days
after it becomes law, provided that the amendments made by section one
of this act would not affect the expiration of article 15-A of the Exec-
utive Law pursuant to chapter 261 of the laws of 1988, as amended, and
would expire and be deemed repealed along with article 15-A.
REASONS FOR SUPPORT:
The most recent disparity studies conducted by both the State of New
York ("State") and the City of New York ("City") demonstrate that
discrimination continues to affect MWBEs seeking to do business in the
markets where the City and the State conduct their procurements. The
State and City are committed to addressing these disparities by operat-
ing MWBE programs that encourage the participation of MBEs in their
respective procurements. The pool of firms that wish to participate in
procurements at both the City and State level is significant: more than
40% of firms certified by the State are also certified by the City.
Currently, the process to establish and to maintain certification at
both levels of government can be administratively burdensome for MWBEs.
These separate and duplicative processes lead to cost, confusion, and
lost opportunities for MWBEs and complicate the work of all entities
-including government agencies, prime vendors, and other private sector
entities- seeking to do business with MWBEs. By authorizing reciprocal
certification, this act would enable the establishment of a procedure
focused on coordination and partnership between the City and State, and
would eliminate the layered administrative burdens current imposed by
the existing regulatory landscape. This change would increase the
success of both the City's and the State's MWBE programs.
STATE OF NEW YORK
________________________________________________________________________
10324--A
IN ASSEMBLY
May 17, 2024
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Septimo) --
read once and referred to the Committee on Governmental Operations --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee
AN ACT to amend the executive law, in relation to reciprocal minority
and women-owned business enterprise certification
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Paragraphs (a) and (b) of subdivision 2-a of section 314 of
2 the executive law, as amended by chapter 96 of the laws of 2019, subpar-
3 agraph (i) of paragraph (a) as amended by chapter 669 of the laws of
4 2022, are amended to read as follows:
5 (a) The director shall establish a procedure [enabling] requiring the
6 office to accept New York municipal corporation certification verifica-
7 tion for minority and women-owned business enterprise applicants in lieu
8 of requiring the applicant to complete the state certification process
9 separately. [The] Any municipal corporation that chooses to use such
10 procedure shall first enter into a memorandum of understanding regarding
11 acceptance of such municipal corporation certification verification with
12 the office, and the director shall promulgate rules and regulations to
13 set forth criteria for the acceptance of municipal corporation certif-
14 ication. [All eligible municipal corporation certifications] An appli-
15 cant certified in lieu of completing the state certification process
16 separately pursuant to this section shall [require] meet the definition
17 of a minority-owned business [enterprises seeking certification to meet
18 the following standards:
19 (i) have at least fifty-one percent ownership by a minority] enter-
20 prise or a women-owned business enterprise [and be owned by United
21 States citizens or permanent resident noncitizens;
22 (ii) be an enterprise in which the minority and/or women-ownership
23 interest is real, substantial and continuing;
24 (iii) be an enterprise in which the minority and/or women-ownership
25 has and exercises the authority to control independently the day-to-day
26 business decisions of the enterprise;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD11217-04-4
A. 10324--A 2
1 (iv) be an enterprise authorized to do business in this state;
2 (v) be subject to a physical site inspection to verify the fifty-one
3 percent ownership requirement;
4 (vi) be owned by an individual or individuals, whose ownership,
5 control and operation are relied upon for certification, with a personal
6 net worth that does not exceed fifteen million dollars and such other
7 amount as the director shall set forth in regulations, as adjusted annu-
8 ally for inflation according to the consumer price index; and
9 (vii) be an enterprise that is a small business pursuant to subdivi-
10 sion twenty of] as set forth in section three hundred ten of this arti-
11 cle in order to receive state certification.
12 (b) The director shall work with all municipal corporations that have
13 a municipal minority and women-owned business enterprise program to
14 develop standards to accept state certification to meet the municipal
15 corporation minority and women-owned business enterprise certification
16 standards whenever a municipal corporation requests assistance. Upon
17 entering into a memorandum of understanding pursuant to paragraph (a) of
18 this subdivision, each municipal corporation that has a municipal minor-
19 ity and women-owned business enterprise program shall establish a proce-
20 dure requiring such municipality to accept state certification verifica-
21 tion for minority and women-owned business enterprise applicants in lieu
22 of requiring applicants to apply to each entity separately. The munici-
23 pal corporation shall develop rules and regulations in order to accept
24 state certification in situations where an applicant who is certified as
25 a minority or women-owned business enterprise pursuant to the law or
26 rule for such municipal corporation's certification program also meets
27 the definition of a minority-owned business enterprise or women-owned
28 business enterprise as set forth in section three hundred ten of this
29 article.
30 § 2. This act shall take effect on the two hundred seventieth day
31 after it shall have become a law; provided, however, that the amendments
32 to paragraphs (a) and (b) of subdivision 2-a of section 314 of the exec-
33 utive law made by section one of this act shall not affect the repeal of
34 such section and shall be deemed repealed therewith.
