NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A7793
SPONSOR: Titus TITLE OF BILL: An act to amend the state finance law and the legisla-
tive law, in relation to participation by state agencies in a system
used by the comptroller to compile vendor responsibility information; in
relation to defining information technology for procurement purposes; in
relation to authorizing the commissioner of the office of general
services and state agencies to develop alternative procurement methods
not otherwise authorized by law under certain circumstances; in relation
to authorizing competitive negotiation concluding with a best and final
offer; in relation to clarifying the use of best and final offers for
invitations for bids and requests for proposals for goods, services and
technology; in relation to clarifying the use of contracts let by anoth-
er governmental agency; in relation to clarifying the valuation of non-
cash contracts by the state comptroller; and in relation to conforming
the definition of restricted period
PURPOSE:
The purpose of this proposed legislation is to increase the transparen-
cy and flexibility of the procurement process.
SUMMARY OF PROVISIONS:
Section 1 of this proposal amends the State Finance Law by adding a new
Section 163-c requiring use by state agencies of a system maintained by
the State Comptroller to compile vendor responsibility information.
Section 2 of this proposal amends Subdivisions 7 and 10 of Section 160
of the State Finance Law in relation to defining information technology
for procurement purposes.
Section 3 of this proposal makes conforming changes to Paragraphs g and
i of Subdivision 2 of Section 161 of the State Finance Law with respect
to the definition of information technology.
Section 4 of this proposal makes conforming changes to Paragraph k of
Subdivision 1 and subdivision 6 of Section 163 of the State Finance Law
with respect to the definition of information technology.
Section 5 of this proposal adds a new Subdivisions 16 to Section 163 of
the State Finance Law. The new Subdivision 16 authorizes alternative
procurement methods for the acquisition of non-construction related
commodities and services, or information technology.
Section 6 of this proposal adds a new Subdivision 17 authorizing compet-
itive negotiation concluding with best and final offer.
Section 7 of this proposal amends Subdivision 9 of Section 163 of the
State Finance Law by adding a new Paragraph c-1 relating to best and
final offer.
Section 8 amends Paragraph e of Subdivision 10 of Section 163 of the
State Finance Law relating to the use of piggybacking of contracts.
Section 9 of this proposal amends Subdivision 3 of Section 112 of the
State Finance Law provide that for contracts where consideration cannot
be determined in terms of monetary value, it shall be valued in terms of
intrinsic value.
Section 10 amends Subdivision m of Section 1-c of the Legislative Law to
conform to the definition of restricted period set forth in the State
Finance Law.
Section 11 provides for an immediate effective date and provides further
that section 1 of the proposal shall take effect on the 180th day after
it shall have become a law and finally, provides that the amendments to
section 163 of the State Finance Law shall'not affect the repeal of
Section 163 and shall be deemed repealed therewith.
PRIOR LEGISLATIVE HISTORY:
2017-2018: S .6452(DeFreanci sco)/A. 8156(P eoples-Stokes) - Veto Memo
336
2016: S. 7893(DeFrancisco)/A.10688 (Peoples-Stokes) - Veto Memo 295
2015: S. 5713-B (DeFrancisco)/A.7513-C (Peoples-Stokes) - Veto Memo 303
JUSTIFICATION:
Vendor Responsibility: To fully standardize the vendor responsibility
review and streamline the contract process, and enable a 24-7, online
access for vendors to update information easily as information changes.
Pursuant to the State Comptroller's responsibility under Section 112 of
the State Finance Law to review and approve State contracts, which may
include a vendor responsibility review performed by the state agency and
the State Comptroller, the State Comptroller finds that mandatory use of
the on-line system for filing necessary vendor responsibility informa-
tion will facilitate an efficient review of a vendor's responsibility
thereby streamlining the procurement process for vendors and contracting
agencies.
Agencies not on the system require vendors to update in paper with every
procurement. 59 agencies use the system now, with more than 11,600
vendors already in the system.
Change references to "technology" in article 11 to "information technol-
ogy": To clarify the definition of technology, to ensure the definition
meets current practice, and ensure future developments in information
technology are anticipated. This amendment would also clarify that inci-
dental technology content is not intended to drive a major procurement
that is not directly information technology related.
Alternative Procurements: When a state agency develops a procurement
method that does not fit within the requirements of the Procurement
Stewardship Act (the Act), the agency should be able to use such an
alternative method for a specific contract award if certain conditions
are met. The bill authorizes the State Comptroller to approve a contract
awarded on the basis of an alternative procurement method as long as (i)
the contracting agency makes a determination, documented in the procure-
ment record, that such alternative procurement method better serves the
interest of the State than other procurement methods available under the
Act and can be applied on a fair and equitable basis; and (ii) the State
Comptroller approves the alternative procurement method prior to the
procurement. In order to effectively monitor the success or failure of
the alternative procurement method the procuring state agency must file
a report with the Governor, State Comptroller and heads of the Legisla-
tive Fiscal Committees by the mid-term of the resulting contract
concerning the benefits of the alternative method and comparing results
to other procurement methods
Competitive Negotiation with Best and Final Offer: This amendment
expands available procurement options to include competitive negotiation
with multiple vendors to obtain the best result for taxpayers. The State
Comptroller anticipates this change would be useful in highly complex
procurements where approaches to meeting the requirements are not pre-
defined, to encourage innovative solutions amidst changing industry
capabilities, or where there may be opportunities for the State to miti-
gate risk or expense through non-material tradeoffs.
Where the basis of award is best value and after completing an initial
evaluation and scoring, a state agency may choose to make an award at
that time based on best value. Or, if the agency believes a better price
or outcome can be achieved, competitive negotiations can be conducted
with vendors that fall in a competitive range and could potentially be
selected based on the final outcome.
Clarifying use of Best and Final Offer: There is a lack of clarity among
agencies as to when Best and Final Offers can be utilized to achieve
best value for the State; this is intended to help clarify the require-
ments for use of best and final offers.
Clarifying Use of "Piggyback" Contracts: This amendment is intended to
ensure that agencies using the contracts of other entities (local,
state, or federal) comply with the intent of the original contract as
well as the mechanism for vendor selection in the case of contracts with
multiple award options.
Clarify Valuation of Non-Cash Contracts: This amendment clarifies that
for contracts with little or no cash actual cash consideration, the
intrinsic value of the contract will be used to determine the threshold.
Conform the Definition of Restricted Period: This technical amendment
conforms the definition of restricted period in the Legislative Law to
the definition of restricted period set forth in Section 139-j of the
State Finance Law as recently amended by Part F of Chapter 57 of the
laws of 2016.
The State Comptroller urges the passage of this proposed legislation.
FISCAL IMPLICATIONS FOR STATE:
None. However, these proposals will help streamline procurements result-
ing in more effective and efficient procurements at reduced costs and
will facilitate the use of new methods that will result in more effec-
tive and efficient procurements at reduced costs and provides additional
transparency to the procurement process.
EFFECTIVE DATE:
Provides for an immediate effective date, provides that certain
provisions take effect on the 180th day and states that certain
provisions shall only apply to any procurement initiated on or after
such date; and further provides that the amendments to Section 163 of
the state finance law shall not affect the repeal of such Section and
shall be deemed repealed therewith.
The State Comptroller urges the passage of this proposed legislation.
