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A07793 Text:

                STATE OF NEW YORK
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                      May 22, 2019
        Introduced by M. of A. TITUS -- (at request of the State Comptroller) --
          read once and referred to the Committee on Governmental Operations
        AN  ACT  to  amend  the  state  finance  law and the legislative 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 another governmental agency; in relation to  clarify-
          ing  the valuation of non-cash contracts by the state comptroller; and
          in relation to conforming the definition of restricted period
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section  1.  The  state finance law is amended by adding a new section
     2  163-c to read as follows:
     3    § 163-c. Vendor responsibility; online system participation. 1.  Defi-
     4  nitions. As used in this section the  following  terms  shall  have  the
     5  following meanings:
     6    a.  "Enrollment"  shall  mean  the establishment of an online services
     7  account with the state comptroller, including, but not limited  to,  the
     8  creation  of  a  unique  user  identification  and  password. Enrollment
     9  provides a user access to the system.
    10    b. "Online services" shall mean the services  provided  electronically
    11  and  securely  by  the  state  comptroller for the benefit of New York's
    12  customers, clients and business partners. Such online  services  may  be
    13  expanded and enhanced as technology allows.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 7793                             2
     1    c.  "State  agency"  or  "state agencies" shall mean all state depart-
     2  ments, boards, commissions, offices or institutions. Such term shall not
     3  include the legislature or the judiciary.
     4    d.  "State  contract" or "contract" shall mean and include any written
     5  agreement for the acquisition of goods, services or construction of  any
     6  kind  between  a  vendor  and  a state agency, or a written agreement or
     7  other instrument wherein a state agency  agrees  to  give  consideration
     8  other  than the payment of money as contemplated in subdivision three of
     9  section one hundred twelve of this chapter.
    10    e. "Subcontractor" shall  mean  an  individual,  sole  proprietorship,
    11  partnership, joint venture or corporation, which is engaged in a subcon-
    12  tract  by  a vendor pursuant to a state contract and such subcontract is
    13  valued at one hundred thousand dollars or more and is known at the  time
    14  of the award of the state contract to the vendor.
    15    f.  "System"  shall  mean  the  on-line  software,  data  and  related
    16  resources maintained by the comptroller to compile vendor responsibility
    17  information.
    18    g. "Terms of service" shall mean the terms and conditions developed by
    19  the state comptroller and agreed to by each  authorized  user  prior  to
    20  gaining  access  to  online services.   Terms of service shall include a
    21  description of the services, obligations of the  state  comptroller  and
    22  the  authorized  user,  a description of the state comptroller's privacy
    23  policy, authorized user code of conduct, and  indemnity  for  the  state
    24  comptroller  and  the state of New York. Terms of service are subject to
    25  change as prescribed by the state comptroller.    Authorized  users  may
    26  view changes via the state comptroller's internet site.
    27    h.  "Vendor"  shall  include  any  person, partnership, corporation or
    28  limited liability company or any business  entity  bidding  on  a  state
    29  procurement or otherwise awarded a state contract.
    30    i.  "Vendor  responsibility" shall mean that a vendor has the capacity
    31  to fully perform the terms of a contract and the integrity and  business
    32  ethics  to justify an award of public dollars. A determination of vendor
    33  responsibility shall include consideration of factors including, but not
    34  limited to, financial  and  organizational  capacity,  legal  authority,
    35  integrity and past performance on governmental contracts.
    36    2. a. State agencies shall enroll with the state comptroller to access
    37  the  system maintained by the comptroller to compile vendor responsibil-
    38  ity information. State agencies shall agree to and abide by the terms of
    39  service for such system as the state comptroller deems necessary.
    40    b. For each contract or subcontract between a vendor and a subcontrac-
    41  tor where, pursuant to law or by direction of the state agency,  disclo-
    42  sure for vendor responsibility is required, the state agency shall:
    43    (i) provide notice to vendors bidding for procurements administered by
    44  the  state agency that any vendor and subcontractor, submitting a vendor
    45  responsibility questionnaire shall do so via the  system  maintained  to
    46  compile vendor responsibility information;
    47    (ii) provide vendors with instructions on how to electronically access
    48  the  system  and provide contact information for assistance with enroll-
    49  ment. This information shall be made available prior to  the  time  when
    50  vendors are required to submit disclosure for vendor responsibility; and
    51    (iii) access the system to obtain and evaluate any data submitted by a
    52  vendor  proposed  for  contract  award.  State agencies shall ensure the
    53  submission filed by the vendor meets such system's timeliness standards.
    54  Such provisions apply regardless of whether the contract is  subject  to
    55  pre-review and approval by the state comptroller.

        A. 7793                             3
     1    c.  For  contracts  where vendor disclosure is not otherwise required,
     2  the state agency at its  discretion,  may  require  vendors  bidding  on
     3  procurements,  and/or  subcontractors, to submit a vendor responsibility
     4  questionnaire via the system. Nothing contained in this paragraph  shall
     5  be construed to alter the existing authority of the state comptroller to
     6  require  the  submission  of  a  vendor  responsibility questionnaire in
     7  conjunction with his or her duty to review and approve  state  contracts
     8  prior to such contracts becoming effective.
     9    d.  State  agencies shall provide access to the system to users within
    10  their organization, as deemed appropriate by the head of the state agen-
    11  cy or his or her designee. State agency users provided with such  access
    12  shall  be  those individuals, who, as part of their official job duties,
    13  are required to assess and/or review vendor responsibility for the agen-
    14  cy's contracts.
    15    § 2. Subdivisions 7 and 10 of section 160 of the  state  finance  law,
    16  subdivision  7  as  amended by section 30 of part L of chapter 55 of the
    17  laws of 2012 and subdivision 10 as added by chapter 83 of  the  laws  of
    18  1995, are amended to read as follows:
    19    7.  "Service"  or  "services" means the performance of a task or tasks
    20  and may include a material good or a quantity  of  material  goods,  and
    21  which is the subject of any purchase or other exchange. For the purposes
    22  of  this  article,  information  technology  shall  be deemed a service.
    23  Services, as defined in this article, shall not apply to those contracts
    24  for architectural, engineering or surveying services, or those contracts
    25  approved in accordance with article eleven-B of this chapter.
    26    10. "[Technology] Information technology" means either  a  good  or  a
    27  service or a combination thereof, [that results in a technical method of
    28  achieving  a  practical purpose or in improvements in productivity] used
    29  in the application of any computer or electronic  information  equipment
    30  or  interconnected  system  that  is  used  in the acquisition, storage,
    31  manipulation, management, movement, control, display, switching,  inter-
    32  change,  transmission,  or  reception of data including, but not limited
    33  to, hardware, software, firmware, programs, systems,  networks,  infras-
    34  tructure,  media,  and  related material used to automatically and elec-
    35  tronically collect, receive, access, transmit, display,  store,  record,
    36  retrieve,  analyze,  evaluate,  process,  classify,  manipulate, manage,
    37  assimilate, control, communicate, exchange,  convert,  converge,  inter-
    38  face,  switch,  or  disseminate  data  of any kind or form. Goods may be
    39  either new or used.
    40    § 3. Paragraphs g and i of subdivision 2 of section 161 of  the  state
    41  finance  law, as added by chapter 83 of the laws of 1995, are amended to
    42  read as follows:
    43    g. Consult with and advise the commissioner on  strategic  information
    44  technology  investments  that  will  facilitate electronic access to the
    45  terms and conditions of existing procurement  contracts,  promote  elec-
    46  tronic  commerce  including,  but  not  limited  to, payment to vendors,
    47  promote and enhance the efficiency of the procurement  of  products  and
    48  services  by  or  for state agencies and produce useful information that
    49  supports state procurement operations, management, analysis and decision
    50  making including, but not limited to, data concerning the status and use
    51  of procurement contracts and the number and type of contracts and  award
    52  recipients;
    53    i. Establish and, from time to time, amend guidelines for the procure-
    54  ment  of  services  and  information  technology  in accordance with the
    55  provisions of this article. Such guidelines shall ensure  the  wise  and
    56  prudent use of public money in the best interest of the taxpayers of the

        A. 7793                             4

     1  state;  guard  against favoritism, improvidence, extravagance, fraud and
     2  corruption; and ensure that service contracts are awarded on  the  basis
     3  of  best  value,  including, but not limited to, the following criteria:
     4  quality, cost, and efficiency;
     5    §  4. Paragraph k of subdivision 1 and subdivision 6 of section 163 of
     6  the state finance law, paragraph k of subdivision 1 as added by  section
     7  36 of part L of chapter 55 of the laws of 2012, subdivision 6 as amended
     8  by chapter 569 of the laws of 2015, are amended to read as follows:
     9    k.  "Authorized  user"  or  "non-state agency purchaser" means (i) any
    10  officer, body or agency of the state or of a political subdivision or  a
    11  district therein, or fire company or volunteer ambulance service as such
    12  are defined in section one hundred of the general municipal law, to make
    13  purchases  of  commodities,  services and information technology through
    14  the office of general services' centralized contracts, pursuant  to  the
    15  provisions  of  section  one  hundred four of the general municipal law;
    16  (ii) any county extension service association as authorized under subdi-
    17  vision eight of section two hundred twenty-four of the county law; (iii)
    18  any association or other entity as specified in and in  accordance  with
    19  section  one hundred nine-a of the general municipal law; (iv) any asso-
    20  ciation, consortium or group of privately owned or municipal, federal or
    21  state owned or operated hospitals, medical schools, other health related
    22  facilities or voluntary ambulance services, which have  entered  into  a
    23  contract  and made mutual arrangements for the joint purchase of commod-
    24  ities, services and information technology pursuant to  section  twenty-
    25  eight  hundred three-a of the public health law; (v) any institution for
    26  the instruction of the deaf or of the blind listed in section  forty-two
    27  hundred  one  of the education law; (vi) any qualified non-profit-making
    28  agency for the blind approved by the commissioner of the office of chil-
    29  dren and family services or  the  office  of  temporary  and  disability
    30  assistance;  (vii) any qualified charitable non-profit-making agency for
    31  the severely disabled approved by the commissioner of education;  (viii)
    32  any  hospital  or residential health care facility as defined in section
    33  twenty-eight hundred one of the public  health  law;  (ix)  any  private
    34  not-for-profit mental hygiene facility as defined in section 1.03 of the
    35  mental  hygiene  law;  (x) any public authority or public benefit corpo-
    36  ration of the state, including the port authority of New  York  and  New
    37  Jersey  and  the  interstate  environmental  commission; (xi) any public
    38  library,  association  library,  library  system,  cooperative   library
    39  system, the New York Library Association, and the New York State Associ-
    40  ation  of  Library  Boards  or  any other library except those which are
    41  operated by for profit entities; (xii) any other association  or  entity
    42  as  specified  in  state law, to make purchases of commodities, services
    43  and information technology  through  the  office  of  general  services'
    44  centralized contracts. Such qualified non-profit-making agencies for the
    45  blind  and  severely  disabled  may make purchases from the correctional
    46  industries program of the department of corrections and community super-
    47  vision subject to rules pursuant to the correction law.
    48    6. Discretionary buying thresholds. Pursuant to guidelines established
    49  by the state procurement council: the commissioner may purchase services
    50  and commodities in an amount not exceeding eighty-five thousand  dollars
    51  without  a  formal  competitive  process;  state  agencies  may purchase
    52  services and commodities in  an  amount  not  exceeding  fifty  thousand
    53  dollars  without  a  formal  competitive process; and state agencies may
    54  purchase commodities or services from small business concerns  or  those
    55  certified  pursuant  to articles fifteen-A and seventeen-B of the execu-
    56  tive law, or commodities or information technology that are recycled  or

        A. 7793                             5
     1  remanufactured,  or  commodities  that are food, including milk and milk
     2  products, grown, produced or harvested in New York state  in  an  amount
     3  not  exceeding two hundred thousand dollars without a formal competitive
     4  process.
     5    §  5.  Section 163 of the state finance law is amended by adding a new
     6  subdivision 16 to read as follows:
     7    16. Alternative procurement methods for the  acquisition  of  non-con-
     8  struction  related  commodities, services and information technology. a.
     9  When the commissioner or a state agency determines that  it  is  in  the
    10  best  interest  of the state to develop a procurement method not author-
    11  ized by this section for non-construction related commodities,  services
    12  and  information  technology, the commissioner or state agency is hereby
    13  authorized to develop and use such method for a specific contract award.
    14  Such determination shall be made in writing and shall include documenta-
    15  tion for the procurement record that such alternative procurement  meth-
    16  od:  (i) would serve the interest of the state better than other methods
    17  currently available under this section; (ii) can be applied on a compet-
    18  itive, fair and equitable basis; and (iii) contains an appropriate eval-
    19  uation methodology that considers both cost and  qualitative  evaluation
    20  factors.    Such  alternative procurement method shall be subject to all
    21  other applicable provisions of this section. The commissioner or a state
    22  agency may not undertake an alternative  procurement  method  until  the
    23  comptroller  has  determined  that  the proposed alternative procurement
    24  method is in the best interest of the state; can be applied on a compet-
    25  itive, fair and equitable basis; and utilizes an appropriate  evaluation
    26  methodology that considers both cost and qualitative evaluation factors.
    27    b.  When  using  an  alternative procurement method authorized by this
    28  subdivision, the commissioner or agency shall include in  its  solicita-
    29  tion  a detailed description of the proposed method of award. In advance
    30  of the initial receipt of offers or  bids,  the  commissioner  or  state
    31  agency shall determine and document in the procurement record the evalu-
    32  ation  criteria  and  process  to  be  used  in the determination of the
    33  specific contract award and the process  by  which  the  evaluation  and
    34  selection  shall be conducted. In addition to the requirements set forth
    35  in paragraph g of subdivision nine  of  this  section,  the  procurement
    36  record  shall  document  the  basis upon which the agency has determined
    37  that potential vendors will be able to respond with viable bids to  such
    38  alternative procurement.
    39    c. Notwithstanding the provisions of subdivision five of section three
    40  hundred  fifty-five  of  the  education  law  to the contrary or section
    41  sixty-two hundred eighteen of the education  law,  before  any  contract
    42  awarded  under  this  section  which  exceeds  fifty thousand dollars in
    43  amount becomes effective it must be  approved  by  the  comptroller  and
    44  filed in his or her office.
    45    d.  For each procurement awarded pursuant to this section, the commis-
    46  sioner or state agency shall submit to the governor, the comptroller and
    47  the heads of the fiscal committees of each house of the  state  legisla-
    48  ture  no  later  than the mid-point of the initial term of the resultant
    49  contract a report assessing the validity of the procurement  method  and
    50  comparing  its  results  to  procurement  methods  for  commodities  and
    51  services or information technology.
    52    § 6. Section 163 of the state finance law is amended by adding  a  new
    53  subdivision 17 to read as follows:
    54    17. Competitive negotiation. a. Where the basis of award is best value
    55  and  after  completing an initial evaluation and scoring, a state agency
    56  may choose to either make an award to the best value offerer pursuant to

        A. 7793                             6

     1  subdivision four of this section or undertake  competitive  negotiations
     2  with  all  offerers  of  proposals  susceptible  of  being  selected for
     3  contract award, so long as the agency reserves the right to conduct such
     4  competitive negotiations in the solicitation.  The negotiations shall be
     5  conducted as provided in paragraph d of this subdivision.
     6    b. Competitive negotiation may only be used where:
     7    (i) at least two offerers are deemed susceptible of being selected for
     8  contract award;
     9    (ii)  in the event that the solicitation includes optional components,
    10  the solicitation shall require all offerers to provide  a  proposal  for
    11  all options or otherwise be deemed nonresponsive; and
    12    (iii)  the  agency  has determined that use of competitive negotiation
    13  will maximize the agency's ability to obtain best value,  based  on  the
    14  agency's need and the specifications set forth in the solicitation.
    15    c.  The  agency must document in the procurement record and in advance
    16  of the initial receipt of offers:
    17    (i) the methodology, which  shall  be  quantifiable  and  based  on  a
    18  comparison  of  the  proposals'  price and technical merit, that will be
    19  employed to arrive at a competitive  range  that  will  determine  which
    20  proposals are to be considered susceptible to award; and
    21    (ii)  a  fair and impartial negotiation procedure, formulated with the
    22  goal of ensuring sustained competition until an award  is  rendered  and
    23  obtaining the best value for the state.
    24    d.  The  agency  shall  conduct  written or oral negotiations with all
    25  responsible offerers who submit proposals in the competitive  range.  In
    26  the course of such negotiations, the agency shall:
    27    (i)  advise  the offerer of ways in which its proposal may be improved
    28  so that the offerer is given an opportunity to better meet the  agency's
    29  needs;
    30    (ii) clarify any uncertainties, ambiguities or non-material deviations
    31  in the proposal;
    32    (iii)  advise  the offerer of any technical components in its proposal
    33  that may not be necessary  to  satisfy  the  agency's  requirements  and
    34  request modifications as appropriate;
    35    (iv)  provide the offerer a reasonable opportunity to submit any cost,
    36  technical or other revisions to its proposal in response to issues iden-
    37  tified during negotiations; and
    38    (v) document any oral negotiations for the procurement record.
    39    e. Negotiations may be tailored to each offerer's  proposal  provided,
    40  however,  such  negotiations shall be conducted with each offerer within
    41  the competitive range  without  disclosing  information  concerning  any
    42  other  offerers' proposals or the evaluation process. Negotiations shall
    43  culminate in a technical solution from each offerer remaining within the
    44  competitive range that is deemed acceptable to meet the agency's need as
    45  set forth in the  solicitation.  After  discussion  of  these  technical
    46  solutions  is completed, the agency shall solicit a best and final price
    47  proposal from all offerers within the competitive range.  The  best  and
    48  final  price solicitation shall ensure that all offerers are afforded an
    49  equal opportunity to respond within a specified period of time.
    50    f. Where an  agency  chooses  to  undertake  competitive  negotiations
    51  instead  of  making  a  best value award after an initial evaluation and
    52  scoring, the final award shall be made to the lowest responsible offerer
    53  after receiving a best and final price on a revised acceptable proposal.
    54    § 7. Subdivision 9 of section 163 of the state finance law is  amended
    55  by adding a new paragraph c-1 to read as follows:

        A. 7793                             7

     1    c-1.  Where a state agency determines that non-material changes to the
     2  specifications as set forth in the solicitation would  be  in  the  best
     3  interest  of the state and, when provided for in the solicitation, state
     4  agencies may request best and final offers, which shall  be  in  writing
     5  and  solicited  in  the  same  manner from all offerers determined to be
     6  susceptible of being selected for contract award,  with  the  intent  of
     7  allowing  an offerer to revise its cost; provided, however, that a state
     8  agency may not make a modification to the solicitation if such modifica-
     9  tion would prejudice  any  bidder  or  potential  bidder  and,  provided
    10  further, that no best and final offer may be accepted or considered by a
    11  state  agency  unless such best and final offer is submitted in response
    12  to a request by the state agency.
    13    § 8. Paragraph e of subdivision 10 of section 163 of the state finance
    14  law, as amended by chapter 137 of the laws of 2008, is amended  to  read
    15  as follows:
    16    e. The commissioner may authorize purchases required by state agencies
    17  or other authorized purchasers by letting a contract pursuant to a writ-
    18  ten  agreement, or by approving the use of a contract let by any depart-
    19  ment, agency or instrumentality of the United States  government  and/or
    20  any department, agency, office, political subdivision or instrumentality
    21  of  any  state or states. A state agency purchaser shall document in the
    22  procurement record its rationale for the use of a contract  let  by  any
    23  department, agency or instrumentality of the United States government or
    24  any department, agency, office, political subdivision or instrumentality
    25  of any other state or states. Such rationale shall include, but need not
    26  be  limited to, a determination of need, a consideration of the procure-
    27  ment method by which the contract was awarded, an analysis  of  alterna-
    28  tive  procurement  sources  including  an  explanation why a competitive
    29  procurement or the use of a centralized contract let by the commissioner
    30  is not in the best interest of the  state,  and  the  reasonableness  of
    31  cost. The authority to use a contract let by another governmental entity
    32  pursuant  to  this  paragraph  is intended to benefit the state by using
    33  contracts in place that provide for the same service or commodity sought
    34  by a state agency at a price determined to be reasonable  by  the  state
    35  agency.  Such  contracts  are not intended to be used primarily to avoid
    36  competitive bidding. Use of multiple award contracts  pursuant  to  this
    37  paragraph  shall  follow  the same basis of selection among the multiple
    38  awardees as was prescribed  by  the  original  contracting  governmental
    39  entity.
    40    § 9. Subdivision 3 of section 112 of the state finance law, as amended
    41  by  section  2-c of part F of chapter 57 of the laws of 2016, is amended
    42  to read as follows:
    43    3. A contract or other instrument wherein the  state  or  any  of  its
    44  officers, agencies, boards or commissions agrees to give a consideration
    45  other  than the payment of money, when the value or reasonably estimated
    46  value of such consideration exceeds twenty-five thousand dollars,  shall
    47  not  become  a  valid enforceable contract unless such contract or other
    48  instrument shall first be approved by the comptroller and filed  in  his
    49  office.  For purposes of this subdivision, where consideration cannot be
    50  determined in terms of monetary value, it shall be valued  in  terms  of
    51  intrinsic value.
    52    §  10. Subdivision (m) of section 1-c of the legislative law, as added
    53  by chapter 1 of the laws of 2005, is amended to read as follows:
    54    (m) The term  "restricted  period"  shall  mean  the  period  of  time
    55  commencing  with  the  earliest  posting,  on  a  governmental  entity's
    56  website, in a newspaper of general circulation, or  in  the  procurement

        A. 7793                             8

     1  opportunities  newsletter  in  accordance  with  article  four-C  of the
     2  economic development law of written notice, advertisement  or  solicita-
     3  tion  of a request for proposal, invitation for bids, or solicitation of
     4  proposals,  or  any  other  method provided for by law or regulation for
     5  soliciting a response from offerers intending to result in a procurement
     6  contract with a [state agency, either house of  the  state  legislature,
     7  the unified court system, or a municipal agency, as that term is defined
     8  by  paragraph  (ii)  of subdivision (s) of this section, and ending with
     9  the final contract award and approval by the state agency, either  house
    10  of the state legislature, the unified court system, or a municipal agen-
    11  cy, as that term is defined by paragraph (ii) of subdivision (s) of this
    12  section,]  governmental  entity and ending with the final contract award
    13  and approval by the governmental entity and, where applicable, the state
    14  comptroller. For the purposes of this subdivision, "governmental entity"
    15  shall have the same meaning as paragraph a of subdivision one of section
    16  one hundred thirty-nine-j of the state finance law.
    17    § 11. This act  shall  take  effect  immediately;  provided,  however,
    18  section  one  of this act shall take effect on the one hundred eightieth
    19  day after it shall have become a law; provided, further,  however,  that
    20  the  provisions  of  sections  four, five, six, seven, eight and nine of
    21  this act shall apply to any procurement initiated on or after such date;
    22  provided, further however, that the amendments to  section  163  of  the
    23  state  finance  law made by sections four, five, six, seven and eight of
    24  this act shall not affect the repeal of  such  section  as  provided  in
    25  subdivision  5  of  section  362  of  chapter 83 of the laws of 1995, as
    26  amended, and shall be deemed repealed therewith.
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