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A08156 Text:

                STATE OF NEW YORK
                               2017-2018 Regular Sessions
                   IN ASSEMBLY
                                      May 31, 2017
        Introduced  by M. of A. PEOPLES-STOKES -- (at request of the State Comp-
          troller) -- read once and referred to the  Committee  on  Governmental
        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
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 8156                             2
     1  customers, clients and business partners. Such online  services  may  be
     2  expanded and enhanced as technology allows.
     3    c.  "State  agency"  or  "state agencies" shall mean all state depart-
     4  ments, boards, commissions, offices or institutions. Such term shall not
     5  include the legislature or the judiciary.
     6    d. "State contract" or "contract" shall mean and include  any  written
     7  agreement  for the acquisition of goods, services or construction of any
     8  kind between a vendor and a state agency,  or  a  written  agreement  or
     9  other  instrument  wherein  a  state agency agrees to give consideration
    10  other than the payment of money as contemplated in subdivision three  of
    11  section one hundred twelve of this chapter.
    12    e.  "Subcontractor"  shall  mean  an  individual, sole proprietorship,
    13  partnership, joint venture or corporation, which is engaged in a subcon-
    14  tract by a vendor pursuant to a state contract and such  subcontract  is
    15  valued  at one hundred thousand dollars or more and is known at the time
    16  of the award of the state contract to the vendor.
    17    f.  "System"  shall  mean  the  on-line  software,  data  and  related
    18  resources maintained by the comptroller to compile vendor responsibility
    19  information.
    20    g. "Terms of service" shall mean the terms and conditions developed by
    21  the  state  comptroller  and  agreed to by each authorized user prior to
    22  gaining access to online services.   Terms of service  shall  include  a
    23  description  of  the  services, obligations of the state comptroller and
    24  the authorized user, a description of the  state  comptroller's  privacy
    25  policy,  authorized  user  code  of conduct, and indemnity for the state
    26  comptroller and the state of New York. Terms of service are  subject  to
    27  change  as  prescribed  by the state comptroller.   Authorized users may
    28  view changes via the state comptroller's internet site.
    29    h. "Vendor" shall include  any  person,  partnership,  corporation  or
    30  limited  liability  company  or  any  business entity bidding on a state
    31  procurement or otherwise awarded a state contract.
    32    i. "Vendor responsibility" shall mean that a vendor has  the  capacity
    33  to  fully perform the terms of a contract and the integrity and business
    34  ethics to justify an award of public dollars. A determination of  vendor
    35  responsibility shall include consideration of factors including, but not
    36  limited  to,  financial  and  organizational  capacity, legal authority,
    37  integrity and past performance on governmental contracts.
    38    2. a. State agencies shall enroll with the state comptroller to access
    39  the system maintained by the comptroller to compile vendor  responsibil-
    40  ity information. State agencies shall agree to and abide by the terms of
    41  service for such system as the state comptroller deems necessary.
    42    b. For each contract or subcontract between a vendor and a subcontrac-
    43  tor  where, pursuant to law or by direction of the state agency, disclo-
    44  sure for vendor responsibility is required, the state agency shall:
    45    (i) provide notice to vendors bidding for procurements administered by
    46  the state agency that any vendor and subcontractor, submitting a  vendor
    47  responsibility  questionnaire  shall  do so via the system maintained to
    48  compile vendor responsibility information;
    49    (ii) provide vendors with instructions on how to electronically access
    50  the system and provide contact information for assistance  with  enroll-
    51  ment.  This  information  shall be made available prior to the time when
    52  vendors are required to submit disclosure for vendor responsibility; and
    53    (iii) access the system to obtain and evaluate any data submitted by a
    54  vendor proposed for contract award.  State  agencies  shall  ensure  the
    55  submission filed by the vendor meets such system's timeliness standards.

        A. 8156                             3
     1  Such  provisions  apply regardless of whether the contract is subject to
     2  pre-review and approval by the state comptroller.
     3    c.  For  contracts  where vendor disclosure is not otherwise required,
     4  the state agency at its  discretion,  may  require  vendors  bidding  on
     5  procurements,  and/or  subcontractors, to submit a vendor responsibility
     6  questionnaire via the system. Nothing contained in this paragraph  shall
     7  be construed to alter the existing authority of the state comptroller to
     8  require  the  submission  of  a  vendor  responsibility questionnaire in
     9  conjunction with his or her duty to review and approve  state  contracts
    10  prior to such contracts becoming effective.
    11    d.  State  agencies shall provide access to the system to users within
    12  their organization, as deemed appropriate by the head of the state agen-
    13  cy or his or her designee. State agency users provided with such  access
    14  shall  be  those individuals, who, as part of their official job duties,
    15  are required to assess and/or review vendor responsibility for the agen-
    16  cy's contracts.
    17    § 2. Subdivisions 7 and 10 of section 160 of the  state  finance  law,
    18  subdivision  7  as  amended by section 30 of part L of chapter 55 of the
    19  laws of 2012 and subdivision 10 as added by chapter 83 of  the  laws  of
    20  1995, are amended to read as follows:
    21    7.  "Service"  or  "services" means the performance of a task or tasks
    22  and may include a material good or a quantity  of  material  goods,  and
    23  which is the subject of any purchase or other exchange. For the purposes
    24  of  this  article,  information  technology  shall  be deemed a service.
    25  Services, as defined in this article, shall not apply to those contracts
    26  for architectural, engineering or surveying services, or those contracts
    27  approved in accordance with article eleven-B of this chapter.
    28    10. "[Technology] Information technology" means either  a  good  or  a
    29  service or a combination thereof, [that results in a technical method of
    30  achieving  a  practical purpose or in improvements in productivity] used
    31  in the application of any computer or electronic  information  equipment
    32  or  interconnected  system  that  is  used  in the acquisition, storage,
    33  manipulation, management, movement, control, display, switching,  inter-
    34  change,  transmission,  or  reception of data including, but not limited
    35  to, hardware, software, firmware, programs, systems,  networks,  infras-
    36  tructure,  media,  and  related material used to automatically and elec-
    37  tronically collect, receive, access, transmit, display,  store,  record,
    38  retrieve,  analyze,  evaluate,  process,  classify,  manipulate, manage,
    39  assimilate, control, communicate, exchange,  convert,  converge,  inter-
    40  face,  switch,  or  disseminate  data  of any kind or form. Goods may be
    41  either new or used.
    42    § 3. Paragraphs g and i of subdivision 2 of section 161 of  the  state
    43  finance  law, as added by chapter 83 of the laws of 1995, are amended to
    44  read as follows:
    45    g. Consult with and advise the commissioner on  strategic  information
    46  technology  investments  that  will  facilitate electronic access to the
    47  terms and conditions of existing procurement  contracts,  promote  elec-
    48  tronic  commerce  including,  but  not  limited  to, payment to vendors,
    49  promote and enhance the efficiency of the procurement  of  products  and
    50  services  by  or  for state agencies and produce useful information that
    51  supports state procurement operations, management, analysis and decision
    52  making including, but not limited to, data concerning the status and use
    53  of procurement contracts and the number and type of contracts and  award
    54  recipients;
    55    i. Establish and, from time to time, amend guidelines for the procure-
    56  ment  of  services  and  information  technology  in accordance with the

        A. 8156                             4
     1  provisions of this article. Such guidelines shall ensure  the  wise  and
     2  prudent use of public money in the best interest of the taxpayers of the
     3  state;  guard  against favoritism, improvidence, extravagance, fraud and
     4  corruption;  and  ensure that service contracts are awarded on the basis
     5  of best value, including, but not limited to,  the  following  criteria:
     6  quality, cost, and efficiency;
     7    §  4. Paragraph k of subdivision 1 and subdivision 6 of section 163 of
     8  the state finance law, paragraph k of subdivision 1 as added by  section
     9  36 of part L of chapter 55 of the laws of 2012, subdivision 6 as amended
    10  by chapter 569 of the laws of 2015, are amended to read as follows:
    11    k.  "Authorized  user"  or  "non-state agency purchaser" means (i) any
    12  officer, body or agency of the state or of a political subdivision or  a
    13  district therein, or fire company or volunteer ambulance service as such
    14  are defined in section one hundred of the general municipal law, to make
    15  purchases  of  commodities,  services and information technology through
    16  the office of general services' centralized contracts, pursuant  to  the
    17  provisions  of  section  one  hundred four of the general municipal law;
    18  (ii) any county extension service association as authorized under subdi-
    19  vision eight of section two hundred twenty-four of the county law; (iii)
    20  any association or other entity as specified in and in  accordance  with
    21  section  one hundred nine-a of the general municipal law; (iv) any asso-
    22  ciation, consortium or group of privately owned or municipal, federal or
    23  state owned or operated hospitals, medical schools, other health related
    24  facilities or voluntary ambulance services, which have  entered  into  a
    25  contract  and made mutual arrangements for the joint purchase of commod-
    26  ities, services and information technology pursuant to  section  twenty-
    27  eight  hundred three-a of the public health law; (v) any institution for
    28  the instruction of the deaf or of the blind listed in section  forty-two
    29  hundred  one  of the education law; (vi) any qualified non-profit-making
    30  agency for the blind approved by the commissioner of the office of chil-
    31  dren and family services or  the  office  of  temporary  and  disability
    32  assistance;  (vii) any qualified charitable non-profit-making agency for
    33  the severely disabled approved by the commissioner of education;  (viii)
    34  any  hospital  or residential health care facility as defined in section
    35  twenty-eight hundred one of the public  health  law;  (ix)  any  private
    36  not-for-profit mental hygiene facility as defined in section 1.03 of the
    37  mental  hygiene  law;  (x) any public authority or public benefit corpo-
    38  ration of the state, including the port authority of New  York  and  New
    39  Jersey  and  the  interstate  environmental  commission; (xi) any public
    40  library,  association  library,  library  system,  cooperative   library
    41  system, the New York Library Association, and the New York State Associ-
    42  ation  of  Library  Boards  or  any other library except those which are
    43  operated by for profit entities; (xii) any other association  or  entity
    44  as  specified  in  state law, to make purchases of commodities, services
    45  and information technology  through  the  office  of  general  services'
    46  centralized contracts. Such qualified non-profit-making agencies for the
    47  blind  and  severely  disabled  may make purchases from the correctional
    48  industries program of the department of corrections and community super-
    49  vision subject to rules pursuant to the correction law.
    50    6. Discretionary buying thresholds. Pursuant to guidelines established
    51  by the state procurement council: the commissioner may purchase services
    52  and commodities in an amount not exceeding eighty-five thousand  dollars
    53  without  a  formal  competitive  process;  state  agencies  may purchase
    54  services and commodities in  an  amount  not  exceeding  fifty  thousand
    55  dollars  without  a  formal  competitive process; and state agencies may
    56  purchase commodities or services from small business concerns  or  those

        A. 8156                             5
     1  certified  pursuant  to articles fifteen-A and seventeen-B of the execu-
     2  tive law, or commodities or information technology that are recycled  or
     3  remanufactured,  or  commodities  that are food, including milk and milk
     4  products,  grown,  produced  or harvested in New York state in an amount
     5  not exceeding two hundred thousand dollars without a formal  competitive
     6  process.
     7    §  5.  Section 163 of the state finance law is amended by adding a new
     8  subdivision 16 to read as follows:
     9    16. Alternative procurement methods for the  acquisition  of  non-con-
    10  struction  related  commodities, services and information technology. a.
    11  When the commissioner or a state agency determines that  it  is  in  the
    12  best  interest  of the state to develop a procurement method not author-
    13  ized by this section for non-construction related commodities,  services
    14  and  information  technology, the commissioner or state agency is hereby
    15  authorized to develop and use such method for a specific contract award.
    16  Such determination shall be made in writing and shall include documenta-
    17  tion for the procurement record that such alternative procurement  meth-
    18  od:  (i) would serve the interest of the state better than other methods
    19  currently available under this section; (ii) can be applied on a compet-
    20  itive, fair and equitable basis; and (iii) contains an appropriate eval-
    21  uation methodology that considers both cost and  qualitative  evaluation
    22  factors.    Such  alternative procurement method shall be subject to all
    23  other applicable provisions of this section. The commissioner or a state
    24  agency may not undertake an alternative  procurement  method  until  the
    25  comptroller  has  determined  that  the proposed alternative procurement
    26  method is in the best interest of the state; can be applied on a compet-
    27  itive, fair and equitable basis; and utilizes an appropriate  evaluation
    28  methodology that considers both cost and qualitative evaluation factors.
    29    b.  When  using  an  alternative procurement method authorized by this
    30  subdivision, the commissioner or agency shall include in  its  solicita-
    31  tion  a detailed description of the proposed method of award. In advance
    32  of the initial receipt of offers or  bids,  the  commissioner  or  state
    33  agency shall determine and document in the procurement record the evalu-
    34  ation  criteria  and  process  to  be  used  in the determination of the
    35  specific contract award and the process  by  which  the  evaluation  and
    36  selection  shall be conducted. In addition to the requirements set forth
    37  in paragraph g of subdivision nine  of  this  section,  the  procurement
    38  record  shall  document  the  basis upon which the agency has determined
    39  that potential vendors will be able to respond with viable bids to  such
    40  alternative procurement.
    41    c. Notwithstanding the provisions of subdivision five of section three
    42  hundred  fifty-five  of  the  education  law  to the contrary or section
    43  sixty-two hundred eighteen of the education  law,  before  any  contract
    44  awarded  under  this  section  which  exceeds  fifty thousand dollars in
    45  amount becomes effective it must be  approved  by  the  comptroller  and
    46  filed in his or her office.
    47    d.  For each procurement awarded pursuant to this section, the commis-
    48  sioner or state agency shall submit to the governor, the comptroller and
    49  the heads of the fiscal committees of each house of the  state  legisla-
    50  ture  no  later  than the mid-point of the initial term of the resultant
    51  contract a report assessing the validity of the procurement  method  and
    52  comparing  its  results  to  procurement  methods  for  commodities  and
    53  services or information technology.
    54    § 6. Section 163 of the state finance law is amended by adding  a  new
    55  subdivision 17 to read as follows:

        A. 8156                             6
     1    17. Competitive negotiation. a. Where the basis of award is best value
     2  and  after  completing an initial evaluation and scoring, a state agency
     3  may choose to either make an award to the best value offerer pursuant to
     4  subdivision four of this section or undertake  competitive  negotiations
     5  with  all  offerers  of  proposals  susceptible  of  being  selected for
     6  contract award, so long as the agency reserves the right to conduct such
     7  competitive negotiations in the solicitation.  The negotiations shall be
     8  conducted as provided in paragraph d of this subdivision.
     9    b. Competitive negotiation may only be used where:
    10    (i) at least two offerers are deemed susceptible of being selected for
    11  contract award;
    12    (ii) in the event that the solicitation includes optional  components,
    13  the  solicitation  shall  require all offerers to provide a proposal for
    14  all options or otherwise be deemed nonresponsive; and
    15    (iii) the agency has determined that use  of  competitive  negotiation
    16  will  maximize  the  agency's ability to obtain best value, based on the
    17  agency's need and the specifications set forth in the solicitation.
    18    c. The agency must document in the procurement record and  in  advance
    19  of the initial receipt of offers:
    20    (i)  the  methodology,  which  shall  be  quantifiable  and based on a
    21  comparison of the proposals' price and technical  merit,  that  will  be
    22  employed  to  arrive  at  a  competitive range that will determine which
    23  proposals are to be considered susceptible to award; and
    24    (ii) a fair and impartial negotiation procedure, formulated  with  the
    25  goal  of  ensuring  sustained competition until an award is rendered and
    26  obtaining the best value for the state.
    27    d. The agency shall conduct written  or  oral  negotiations  with  all
    28  responsible  offerers  who submit proposals in the competitive range. In
    29  the course of such negotiations, the agency shall:
    30    (i) advise the offerer of ways in which its proposal may  be  improved
    31  so  that the offerer is given an opportunity to better meet the agency's
    32  needs;
    33    (ii) clarify any uncertainties, ambiguities or non-material deviations
    34  in the proposal;
    35    (iii) advise the offerer of any technical components in  its  proposal
    36  that  may  not  be  necessary  to  satisfy the agency's requirements and
    37  request modifications as appropriate;
    38    (iv) provide the offerer a reasonable opportunity to submit any  cost,
    39  technical or other revisions to its proposal in response to issues iden-
    40  tified during negotiations; and
    41    (v) document any oral negotiations for the procurement record.
    42    e.  Negotiations  may be tailored to each offerer's proposal provided,
    43  however, such negotiations shall be conducted with each  offerer  within
    44  the  competitive  range  without  disclosing  information concerning any
    45  other offerers' proposals or the evaluation process. Negotiations  shall
    46  culminate in a technical solution from each offerer remaining within the
    47  competitive range that is deemed acceptable to meet the agency's need as
    48  set  forth  in  the  solicitation.  After  discussion of these technical
    49  solutions is completed, the agency shall solicit a best and final  price
    50  proposal  from  all  offerers within the competitive range. The best and
    51  final price solicitation shall ensure that all offerers are afforded  an
    52  equal opportunity to respond within a specified period of time.
    53    f.  Where  an  agency  chooses  to  undertake competitive negotiations
    54  instead of making a best value award after  an  initial  evaluation  and
    55  scoring, the final award shall be made to the lowest responsible offerer
    56  after receiving a best and final price on a revised acceptable proposal.

        A. 8156                             7

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

        A. 8156                             8
     1    (m) The term  "restricted  period"  shall  mean  the  period  of  time
     2  commencing  with  the  earliest  posting,  on  a  governmental  entity's
     3  website, in a newspaper of general circulation, or  in  the  procurement
     4  opportunities  newsletter  in  accordance  with  article  four-C  of the
     5  economic  development  law of written notice, advertisement or solicita-
     6  tion of a request for proposal, invitation for bids, or solicitation  of
     7  proposals,  or  any  other  method provided for by law or regulation for
     8  soliciting a response from offerers intending to result in a procurement
     9  contract with a [state agency, either house of  the  state  legislature,
    10  the unified court system, or a municipal agency, as that term is defined
    11  by  paragraph  (ii)  of subdivision (s) of this section, and ending with
    12  the final contract award and approval by the state agency, either  house
    13  of the state legislature, the unified court system, or a municipal agen-
    14  cy, as that term is defined by paragraph (ii) of subdivision (s) of this
    15  section,]  governmental  entity and ending with the final contract award
    16  and approval by the governmental entity and, where applicable, the state
    17  comptroller. For the purposes of this subdivision, "governmental entity"
    18  shall have the same meaning as paragraph a of subdivision one of section
    19  one hundred thirty-nine-j of the state finance law.
    20    § 11. This act  shall  take  effect  immediately;  provided,  however,
    21  section  one  of this act shall take effect on the one hundred eightieth
    22  day after it shall have become a law; provided, further,  however,  that
    23  the  provisions  of  sections  four, five, six, seven, eight and nine of
    24  this act shall apply to any procurement initiated on or after such date;
    25  provided, further however, that the amendments to  section  163  of  the
    26  state  finance  law made by sections four, five, six, seven and eight of
    27  this act shall not affect the repeal of  such  section  as  provided  in
    28  subdivision  5  of  section  362  of  chapter 83 of the laws of 1995, as
    29  amended, and shall be deemed repealed therewith.
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