S T A T E   O F   N E W   Y O R K
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                                 5283--A

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                              May 12, 2015
                               ___________

Introduced  by  Sen. MARTINS -- read twice and ordered printed, and when
  printed to be committed to  the  Committee  on  Finance  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN  ACT  to  amend the state finance law, in relation to requiring state
  agencies to pay small businesses within fifteen days of receipt of  an
  invoice

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subdivisions 2 and 3 of section 179-f of the state  finance
law,  subdivision 2 as amended and subdivision 3 as added by chapter 153
of the laws of 1984, are amended and a new subdivision  6  is  added  to
read as follows:
  2.  The required payment date shall be thirty calendar days, excluding
legal holidays,  PROVIDED,  HOWEVER,  THAT  FOR  A  SMALL  BUSINESS  THE
REQUIRED  PAYMENT  DATE  SHALL BE FIFTEEN CALENDAR DAYS, EXCLUDING LEGAL
HOLIDAYS, or in the case  of  final  payments  on  highway  construction
contracts  seventy-five  calendar  days, excluding legal holidays, after
receipt of an invoice for the amount of the contract payment due; except
when:
  (a) the state comptroller in the course of his OR HER audit determines
that there is reasonable cause to believe that payment may not  properly
be due, in whole or in part;
  (b)  in  accordance with specific statutory or contractual provisions,
payment must be preceded by an inspection  period  or  by  an  audit  to
determine  the  resources  applied or used by a contractor in fulfilling
the terms of the contract;
  (c) the necessary state government appropriation required to authorize
payment has yet to be enacted;
  (d) the cash balance of the fund or sub-fund from which the payment is
to be made is insufficient to finance the payment;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09804-05-5
              

S. 5283--A                          2

  (e) a proper invoice must be examined by the federal government  prior
to payment;
  (f) the goods or property have not been delivered or the services have
not  been  rendered  by  the  contractor in compliance with the terms or
conditions of the contract;
  (g) the required payment date is modified in accordance with  subdivi-
sion three of this section; or
  (h)  in  the  case of final payments on highway construction contracts
the commissioner of transportation determines that  the  contractor  has
failed  to properly submit the necessary documents and other submissions
prescribed by the  contract  specifications  and  requirements,  by  the
provisions  of  subdivision eight of section thirty-eight of the highway
law, and by all other applicable state and  federal  laws  in  order  to
enable  the  department  of  transportation to process the final payment
properly and expeditiously.
  Any time taken to satisfy or rectify any of the  types  of  conditions
described in paragraphs (a) through (f) or (h) of this subdivision shall
extend  the  required payment date by an equal period of time, PROVIDED,
HOWEVER, THAT FOR SMALL BUSINESSES, THE REQUIRED PAYMENT DATE  SHALL  BE
FIFTEEN  CALENDAR  DAYS, EXCLUDING LEGAL HOLIDAYS, AFTER SUCH CONDITIONS
HAVE BEEN SATISFIED OR RECTIFIED, AND PROVIDED FURTHER THAT ALL  REASON-
ABLE  AND  PRACTICABLE EFFORTS SHALL BE TAKEN TO SATISFY OR RECTIFY SUCH
CONDITIONS AS SOON AS POSSIBLE.
  3. Each state agency shall have fifteen calendar days after receipt of
an invoice by the state agency at its designated payment office,  OR  IN
THE  CASE  OF  AN INVOICE RECEIVED FROM A SMALL BUSINESS, SEVEN CALENDAR
DAYS, to notify the contractor of (a) defects in  the  delivered  goods,
property,  or  services,  (b)  defects  in the invoice, or (c) suspected
improprieties of any kind; and the existence of such defects  or  impro-
prieties  shall prevent the commencement of the time period specified in
subdivision two of this section. When a state agency fails to  notify  a
contractor  of  such  defects  or suspected improprieties within fifteen
calendar days, OR SEVEN CALENDAR DAYS IF  SUCH  CONTRACTOR  IS  A  SMALL
BUSINESS,  of  receiving  the  invoice,  the  number of days allowed for
payment of the corrected proper invoice will be reduced by the number of
days between the fifteenth day, OR SEVENTH DAY IF PAYMENT OF SUCH PROPER
INVOICE IS FOR A SMALL BUSINESS, and the day that notification was tran-
smitted to the contractor. If the  state  agency,  in  such  situations,
fails  to provide reasonable grounds for its contention that a defect or
impropriety exists, the required payment date shall be  calculated  from
the date of receipt of an invoice.
  6.  AS  USED  IN  THIS SECTION, "SMALL BUSINESS" SHALL MEAN A BUSINESS
WHOSE PRIMARY PLACE OF BUSINESS IS IN NEW YORK STATE, HAS A  SIGNIFICANT
BUSINESS PRESENCE IN THE STATE, IS INDEPENDENTLY OWNED AND OPERATED, NOT
DOMINANT IN ITS FIELD, AND EMPLOYS NO MORE THAN THREE HUNDRED EMPLOYEES.
  S 2. This act shall take effect on the one hundred eightieth day after
it  shall  have  become  a law and shall apply only to invoices received
after such date.