Authorizes public authorities and public benefit corporations to negotiate with professional firms providing architectural or engineering services in order from the most qualified to the least qualified with regard to the provision of services to the authority or corporation.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9575
SPONSOR: Hyndman TITLE OF BILL:
An act to amend the public authorities law, in relation to requiring
public authorities and public benefit corporations to negotiate with
professional firms providing architectural or engineering services in
order from the most qualified to the least qualified with regard to the
provision of services to the authority or corporation
PURPOSE OF THE BILL:
This bill would allow public authorities a greater opportunity to nego-
tiate with the most qualified architectural and engineering professional
firms through annual statements of qualifications and performance data
created by professional firms.
SUMMARY OF PROVISIONS:
§ 1 - Amends subparagraph (iv) of paragraph (b) of subdivision 3 of 2879
of the public Authorities Law.
§ 2 - Effective date.
JUSTIFICATION:
The intent of this bill is to ensure that public authorities and public
benefit corporations receive the services of the most qualified contrac-
tor through the establishment of a new mechanism for the procurement of
engineering, architectural and surveying services. Qualifications Based
Selections (QBS) is a procurement process that is used widely throughout
the country and has recently been adopted by New York City. Instead of
cost-based procurement which focuses primarily on price, QBS procurement
focuses on qualifications and experience as the paramount basis for
selection. However, after the highest technically ranked firm is
selected and the project scope is fully defined, QBS generates a realis-
tic fee based on a fee proposal by the consultant and negotiations with
the agency. If an agency cannot negotiate a fair price with the first
choice consultant, it has the option to negotiate with the next highly
qualified consultant, and so on. QBS allows agencies to select the
design firm with the best experience, capabilities, technical approach
and quality of personnel, matched to the needs of the project and the
agency; generates better plans and specifications, resulting in higher
quality contract documents that make bidding on an d carrying out
construction easier; fosters the development of innovative, cost-effec-
tive design solutions at a fair market value, resulting in lower overall
project costs; and generates design solutions that best meet the needs
of the project, emphasizing public health, safety and quality of life.
QBS is mandated in at least 46 other states and has proven to be an
effective procurement tool. QBS generates competition by bringing more
firms into the bidding process. As a result, owners are ensured a better
project and a savings to the taxpayer.
LEGISLATIVE HISTORY:
2021/22: S5713
2020/21: S5115
2017/18 A.5750/S.5600
2015/16 A.5759A/S.4475A
2013/14 A.7268A/S.6639A
2011/12 A.6814A/S.1363A
FISCAL IMPLICATIONS:
Should result in cost savings for the State.
EFFECTIVE DATE:
This act shall take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
9575
IN ASSEMBLY
March 20, 2024
___________
Introduced by M. of A. HYNDMAN -- read once and referred to the Commit-
tee on Corporations, Authorities and Commissions
AN ACT to amend the public authorities law, in relation to requiring
public authorities and public benefit corporations to negotiate with
professional firms providing architectural or engineering services in
order from the most qualified to the least qualified with regard to
the provision of services to the authority or corporation
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subparagraph (iv) of paragraph (b) of subdivision 3 of
2 section 2879 of the public authorities law, as amended by chapter 383 of
3 the laws of 1994, is amended to read as follows:
4 (iv) as used in this subparagraph, the term "professional firm" shall
5 be defined as any individual or sole proprietorship, partnership, corpo-
6 ration, association, or other legal entity permitted by law to practice
7 the professions of architecture, engineering or surveying.
8 It is the policy of New York state to negotiate contracts for archi-
9 tectural and/or engineering services and/or surveying services on the
10 basis of demonstrated competence and qualification for the type of
11 professional services required and at fair and reasonable fees.
12 In the procurement of architectural, engineering and surveying
13 services, the corporation is required to encourage professional firms
14 engaged in the lawful practice of the profession to submit an annual
15 statement of qualifications and performance data. The corporation for
16 each proposed project is required to evaluate current statements of
17 qualifications and performance data on file with the corporation. If
18 desired, the corporation may conduct discussions with three or more
19 professional firms regarding anticipated design concepts and proposed
20 methods of approach to the assignment. The corporation is required to
21 select, in order of preference, based upon criteria established by the
22 corporation, no less than three professional firms deemed to be the most
23 highly qualified to provide the services required.
24 Every corporation is required to negotiate a contract with the highest
25 qualified professional firm for architectural and/or engineering
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04392-01-3
A. 9575 2
1 services and/or surveying services at compensation which the corporation
2 determines in writing to be fair and reasonable to such corporation. In
3 making this decision, the corporation is required to take into account
4 the estimated value of the services to be rendered, including the costs,
5 the scope, complexity and professional nature thereof.
6 The corporation shall not refuse to negotiate with a professional firm
7 solely because the ratio of the "allowable indirect costs" to direct
8 labor costs of the professional firm or the hourly labor rate in any
9 labor category of the professional firm exceeds a limitation generally
10 set by the corporation in the determination of the reasonableness of the
11 estimated cost of services to be rendered by the professional firm, but
12 rather the corporation should also consider the reasonableness of cost
13 based on the total estimated cost of the service of the professional
14 firm which should include, among other things, all the direct labor
15 costs of the professional firm for such services plus all "allowable
16 indirect costs," other direct costs, and negotiated profit of the
17 professional firm. "Allowable indirect costs" of a professional firm are
18 defined as those costs generally associated with overhead which cannot
19 be specifically identified with a single project or contract and are
20 considered reasonable and allowable under specific state contract or
21 allowability limits. Should the corporation choose to engage in a qual-
22 ification based procurement and be unable to negotiate a satisfactory
23 contract with the professional firm considered to be the most qualified,
24 at a fee the corporation determines to be fair and reasonable to the
25 corporation, negotiations with that professional firm shall be formally
26 terminated. The corporation shall then undertake negotiations with the
27 second most qualified professional firm. Failing accord with the second
28 most qualified professional firm, the corporation shall formally termi-
29 nate negotiations. The corporation shall then undertake negotiations
30 with the third most qualified professional firm. Should the corporation
31 be unable to negotiate a satisfactory contract with any of the selected
32 professional firms, it shall select additional professional firms in
33 order of their competence and qualifications and it shall continue nego-
34 tiations in accordance with this section until an agreement is reached.
35 The provisions of this subparagraph shall only apply to engineering
36 and/or architectural services and/or surveying services in excess of
37 twenty-five thousand dollars and shall not apply to the metropolitan
38 transportation authority, the New York city transit authority or the
39 Triborough bridge and tunnel authority or to any of their subsidiaries.
40 § 2. This act shall take effect immediately.
