New Jersey-2012-S130-Introduced

An Act concerning public contract set-aside programs, supplementing Title 52 of the Revised Statutes and amending various parts of the statutory law.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 5 of P.L.1983, c.482 (C.52:32-21) is amended to read as follows:

5. a. There are established [the] goals that contracting agencies award at least 15% of their contracts for small businesses, at least [7%] 10% of their contracts for minority businesses and at least [3%] 5% of their contracts for female businesses. These goals may, where appropriate, be attained by the direct designation of prime contracts for small business, minority business or female business or, in the case of a prime contract not directly designated for small business, minority business or female business, by requiring that a portion of such a prime contract be subcontracted or subsubcontracted to a small business, minority business or female business. Each contracting agency shall make a good faith effort to attain the goals established in this section. When a sufficient number of minority businesses or female businesses are not available to meet the goals established for these businesses, the minority business and female business goals may be met by awarding a contract to a small business.

b. The goals established in subsection a. of this section shall be attained independently of each other, and any given contract may be counted for purposes of attaining the small business goal, the minority business goal, or the female business goal, but not towards more than one goal. Pursuant to the goals established by this act, a total of at least [25%] 30% of the State's procurement contracts shall be awarded to small businesses, minority businesses, and female businesses.

c. For purposes of attaining these goals, contracting agencies shall, when necessary, specifically set aside contracts or portions of contracts for which only small businesses, minority businesses or female businesses may bid.

(cf: P.L.1985, c.384, s.6)

2. Section 1 of P.L.1995, c.39 (C.52:32-22.1) is amended to read as follows:

1. a. Whenever any obligation is imposed by law upon a contracting agency to set aside a percentage of State contracts awarded by that agency for minority businesses or women's
businesses, compliance with that requirement shall be calculated based, according to objective and verifiable standards as promulgated pursuant to administrative regulation, upon the dollar value of payments actually made each year to, and received by, minority businesses and women's businesses pursuant to State contracts awarded by that agency, or subcontracts or subsubcontracts thereto, compared to the total of all payments made to, and received by, all parties awarded State contracts by that agency.

Compliance with any such set-aside requirement shall not be calculated using statements made by bidders with respect to the portion of a contract which the bidder intends to subcontract to minority businesses or women's businesses.

b. As used in this section:

"contracting agency" means the State or any board, commission, State institution of higher education, committee, authority or agency of the State; and

"State contract" means any purchase, contract or agreement the cost or contract price of which is to be paid, in whole or in part, with or out of State funds.

(cf: P.L.1995, c.39, s.1)

3. Section 1 of P.L.1995, c.129 (C.52:32-23.1) is amended to read as follows:

1. a. The [Department of Commerce and Economic Development] New Jersey Commerce, Economic Growth and Tourism Commission shall be responsible for the operation and continued development of the central registry, known as the Selective Assistance Vendor Information (SAVI II) database, which lists businesses certified as eligible to perform contracts under any State or local government set-aside program. The commission shall also oversee and enforce compliance with all public contract set-aside requirements established by law. The purpose of the database shall be to enable contracting agencies and persons bidding on, or performing, [State] public contracts at all levels of government to have ready access to the names of businesses which are eligible to perform set-aside contracts and to allow the department and contracting agencies, as well as units of local government, to monitor participation by these businesses in [State] government contracting.

b. The department shall randomly monitor businesses certified as eligible for any [State] public set-aside program, or seeking such certification, to ensure compliance with eligibility requirements.

c. A person applying for the certification of a business as eligible for participation in any [State] public set-aside program shall certify in writing that the person believes that the business meets all of the requirements for eligibility for the program. Any person who makes a false statement in connection therewith shall be subject to the penalties provided by N.J.S.2C:28-2.

(cf: P.L.1995, c.129, s.1)

4. Section 1 of P.L.1986, c.195 (C.52:27H-21.17) is amended to read as follows:

1. The Legislature finds and declares that:

a. Historically, businesses owned by minorities and women have been small establishments offering products and services and their participation in the nation's business community has been disproportionate to their numbers in society as a whole.

b. The opportunity for full participation in our free enterprise system by minorities and women is essential if social and economic justice for them is to be attained, and the functioning of our economy improved.

c. The role of government at the national, State and local levels in encouraging the development of businesses owned by minorities and women has been recognized and is developing at a rapid pace, with technical and financial assistance, contract procurement, contract set-asides and other programs designed to encourage development.

d. As a result, each year entrepreneurs in New Jersey spend an average of $5,000.00 to demonstrate that they qualify for these programs designed to foster the growth and development of their businesses, so that the public agencies administering the programs can be certain that the businesses which benefit are bona fide minority or women's businesses.

e. A unified procedure for the certification of businesses owned by minorities and women, administered by the State, for the purpose of certifying the eligibility of the businesses for various State and local government programs will eliminate duplication of effort and improve efficiency, thereby increasing productivity and reducing costs in the public and the private sectors.

(cf: P.L.1986, c.195, s.1)

5. Section 2 of P.L.1986, c.195 (C.52:27H-21.18) is amended to read as follows:

2. As used in this act:

a. "Control" means authority over the affairs of a business, including, but not limited to, capital investment, property acquisition, employee hiring, contract negotiations, legal matters, officer and director selection, operating responsibility, financial transactions and the rights of other shareholders or joint partners; except that control shall not include absentee ownership, nor shall it be deemed to exist where an owner or employee who is not a minority, in the case of a minority business; or a male owner or employee, in the case of a women's business, is disproportionately responsible for the operation of the business or for policy and contractual decisions.

b. "Commissioner" means the Secretary and Chief Executive Officer of the New Jersey Commerce [and], Economic Growth and Tourism Commission created pursuant to section 3 of P.L.1998, c.44 (C.52:27C-63).

c. "Director" means the Director of the Division of Development for Small Businesses and Women's and Minority Businesses in the New Jersey Commerce [and], Economic Growth and Tourism Commission created pursuant to section 3 of P.L.1998, c.44 (C.52:27C-63).

d. "Division" means the Division of Development for Small Businesses and Women's and Minority Businesses in the New Jersey Commerce [and], Economic Growth and Tourism Commission created pursuant to section 3 of P.L.1998, c.44 (C.52:27C-63).

e. "Minority" means a person who is:

(1) [Black] African American, which is a person having origins in any of the black racial groups in Africa; or

(2) Hispanic, which is a person of Spanish or Portuguese culture, with origins in Mexico, South or Central America, or the Caribbean Islands, regardless of race; or

(3) Asian-American, which is a person having origins in any of the original peoples of the Far East, Southeast Asia, Indian subcontinent, Hawaii, or the Pacific Islands [; or

(4) American Indian or Alaskan native, which is a person having origins in any of the original peoples of North America].

f. "Minority business" means a business which is:

(1) A sole proprietorship owned and controlled by a minority;

(2) A partnership or joint venture owned and controlled by minorities in which at least 51% of the ownership interest is held by minorities and the management and daily business operations of which are controlled by one or more of the minorities who own it; or

(3) A corporation or other entity whose management and daily business operations are controlled by one or more minorities who own it, and which is at least 51% owned by one or more minorities, or, if stock is issued, at least 51% of the stock is owned by one or more minorities.

g. "Public agency" means the State or any department, division, agency, authority, board, commission or committee thereof, and any unit of local government.

h. "Woman" or "women" means a female or females, regardless of race.

i. "Women's business" means a business which is:

(1) A sole proprietorship owned and controlled by a woman; or

(2) A partnership or joint venture owned and controlled by women in which at least 51% of the ownership is held by women and the management and daily business operations of which are controlled by one or more women who own it; or

(3) A corporation or other entity whose management and daily business operations are controlled by one or more women who own it, and which is at least 51% owned by women, or, if stock is issued, at least 51% of the stock is owned by one or more women.

j. "Applicant" means an individual or individuals, a sole proprietor, partnership, joint venture or corporation that applies for certification as a minority business or women's business, in accordance with the provisions of P.L.1986, c.195 (C.52:27H-21.17 et seq.).

(cf: P.L.2003, c.189, s.2)

6. (New section) The head of each State department or contracting agency, as well as the contracting agent of any unit of local government, shall be responsible for meeting all applicable minority business, female business, or small business set-aside goals. A State or local government agency that fails to meet any applicable set-aside goal may be permitted to backlog the unmet goals for one year adding the unmet percentages into the following year's goal. A State or local government agency that fails to meet any applicable set-aside goal for two consecutive years shall have appropriated funds for operations withheld by 10% until such a time as it demonstrates that it has met the requirement. A party awarded any State or local government contract to which a set-aside requirement applies shall have 10% of any amount payable to it under the contract withheld until such time as it demonstrates that it has met that requirement.

7. (New section) The State's public contract set-aside program for minority businesses and women businesses is hereby reestablished as of the effective date of P.L. , c. (pending before the Legislature as this bill).

8. This act shall take effect immediately.

STATEMENT

This bill reestablishes and revises the State's minority business and women business public contract set-aside programs.

Specifically, the bill:

increases the goals for the percentages of contracts to be set aside for minority businesses from 7% to 10%, and women businesses from 3% to 5%;

provides that when a sufficient number of minority businesses or female businesses are not available to meet the goals established for these businesses, the minority business and female business goals may be met by awarding a contract to a small business;

provides that subsubcontracts will count toward achieving these goals;

provides that the Selective Assistance Vendor Information System (SAVI II) database will be expanded and used by both the State and local governments in meeting any set-aside requirements established by law;

establishes a uniform process for certification of the qualifications of minority businesses, women businesses, and small businesses for participation in public contract set-aside programs at all levels of government;

provides that the Commerce, Economic Growth and Tourism Commission will oversee and enforce all public contract set-aside requirements established by law;

updates the definition of minority business to reflect racial and ethnic groups against whom a history of discrimination has been sufficiently documented to justify participation in the set-aside program;

provides that the head of each State department or contracting agency, as well as the contracting agent of any unit of local government, shall be responsible for meeting all applicable minority business, women business, or small business set-aside goals;

provides that a State or local government agency that fails to meet any applicable set-aside goal may be permitted to backlog the unmet goals for one year adding the unmet percentages into the following year's goal and a State or local government agency that fails to meet any applicable set-aside goal for two consecutive years shall have its appropriation for operations withheld by 10% until such a time as it demonstrates that it has met the requirement; and

provides that a party awarded any State or local government contract to which a set-aside requirement applies will have 10% of any amount payable to it under the contract withheld until such time as it demonstrates that it has met that requirement.