Office of General Services lisa.fox@ogs.state.ny.us (518) 474-0571 Presenter’s Contact Information Lisa Fox Legal Services Office of General Services lisa.fox@ogs.state.ny.us (518) 474-0571 OGS Website www.ogs.state.ny.us

What is Procurement Lobbying? What is the purpose of this law? Questions What is Procurement Lobbying? What is the purpose of this law? How does Procurement Lobbying impact the governmental procurement process?

What is the Procurement Lobbying Law? Two provisions of law separately addressing different aspects of the procurement process Legislative Law Interpreted and enforced by the NYS Temporary Commission on Lobbying – focus on the actions of registered lobbyists and clients State Finance Law §139-j and §139-k Addresses actions of Governmental Entities and the business community

Advisory Council on Procurement Lobbying Guidance, model forms, language and other materials on the State Finance Law provisions are present on the internet at: http://www.ogs.state.ny.us/aboutOgs/ regulations/defaultAdvisoryCouncil.html Use website and materials to educate staff and the business community regarding these legal requirements

The Purpose of the Procurement Lobbying Law It develops standard governmental procurement practices about: - the kinds of information to be provided to the business community obtained from the business community - the kinds of information to be made part of the formal record for a procurement

The Purpose of the Procurement Lobbying Law It imposes standard requirements on the business community about: - Where the business community can direct its advocacy efforts about a procurement contract > Designated Contact(s) > Permissible Subject Matter Communications - An Offerer is limited in who it can Contact

The Purpose of the Procurement Lobbying Law It imposes new consequences if an Offerer has impermissible Contacts: possible no award of contract possible finding of non-responsibility possible debarment No proposals submitted or contracts awarded for a 4 year period

The Purpose of the Procurement Lobbying Law Builds on the pre-existing requirements governing procurement activities, such as State Finance Law Articles 9 and 11, the Freedom of Information Law, the Open Meeting Law and, Public Officers Law Code of Conduct Formalizes and standardizes practices already in place documenting the procurement process and clarifies responsibilities and expectations when expending public funds Emphasis on open, transparent, and fair procurement process

Applicability of State Finance Law Provisions Every State Agency Public Authorities of which at least one member is appointed by the Governor Unified Court System Legislature Certain Industrial Development Agencies Public Benefit Corporations

Procurement (commodities, services and technology) Types of Contracts Subject to the Law Construction Procurement (commodities, services and technology) Real Estate (purchase, sale, lease of real property including interest therein.) Certain Revenue Contracts Assignments, renewals, extensions and certain amendments when the estimated annualized expenditure will exceed $15,000

Types of Contracts Subject to the Law (continued) Definition of Procurement Contract expressly exempts - Grants - SFL Article 11-B contracts - Intergovernmental agreements - Railroad and utility force accounts - Utility relocation agreements - Eminent domain transactions

State Finance Law Provisions of the Procurement Lobbying Law General Rule is: - State Finance Law recognizes that communications are necessary to the conduct of Government Procurement - There are different kinds of communications - Certain kinds of communications (referred to as Contacts) with Government Entities about Procurement Contracts have specific rules during certain time periods (Restricted Period)

Restricted Period for a Competitively Bid State Agency Contract (limits who can receive Contacts) Approval of contract by OSC Definition of business need Ad in Contract Reporter

What Communications Must Be Recorded Under this Law? Not all communications are Contacts! A Contact is an - oral, written or electronic communication - with a Governmental Entity - under circumstances where a reasonable person would infer - the communication was intended to influence the Governmental Procurement

What Communications Must Be Recorded Under this Law? Obligation is to record ALL Contacts Whether a communication is a Contact depends on several factors - Is there a procurement contract/ transaction? > Generally speaking, receipt of “cold” marketing material is not a procurement contract and does not trigger these requirements.

What Communications Must Be Recorded Under this Law? - Is it a covered transaction? > See prior listing for exempt transactions - What is the value of the transaction? > The requirements are only applicable if the estimated annualized value exceeds $15,000 - Is there a Restricted Period? > Has there been a written notice or other solicitation for a proposal? > Has the contract received its final approval?

What Communications Must Be Recorded Under this Law? - Who was the communication from? > Communications from the members or staff NYS Legislature (on non-legislative procurements) in their official capacity are not Contacts and shall not be recorded under the SFL > Offerer – individual or entity, or employee, agent or consultant or person acting on behalf of such individual or entity, that contacts a Governmental Entity during the Restricted Period about a Governmental Procurement

What Communications Must Be Recorded Under this Law? Does the communication constitute a Contact? - Statute defines the term - Number of factors to consider - “Reasonable person” standard - Consider totality of the circumstances

What Communications Must Be Recorded Under this Law? Applying the “reasonable person test,” factual exchanges of information are generally not Contacts - When is the bid due? - Where is the bid due? Communications that a reasonable person would probably consider an attempt to influence - You should award the bid to my company because…

What Communications Must Be Recorded Under this Law? If the communication is a Contact, then: 1. Complete a Record of Contact – document that collects the statutorily required information about the person Contacting 2. Place each Record of Contact in the procurement record 3. Determine if there is a requirement to report/refer for review and investigation because it is an impermissible Contact

What Communications Must Be Recorded Under this Law? Who can receive Contacts during the Restricted Period? - Designated Contact(s) - Permissible Subject Matter Communications An Offerer is limited in who it can Contact

Person or persons identified by a Governmental Designated Contact Person or persons identified by a Governmental Entity who may be Contacted by Offerers about a procurement Designated Contact may receive all communications from Offerers, including attempts to influence (Contacts) Communications to Designated Contact are limited by Public Officers Law and Penal Law (i.e., bribery)

Permissible Subject Matter Communications State Finance Law §139-j(3)(a) recognizes a specific series of communications and Contacts that can go to other than the Designated Contacts Important that Offerer’s Contacts be limited to the specific subject matter These Contacts are with the procuring Governmental Entity and other Governmental Entities

Permissible Subject Matter Communications #1 - submission of a written proposal from an Offerer #2 - submission of written questions in accordance with the solicitation, that must include sending all responses to all Offerers #3 - participation in a conference provided for in a solicitation

Permissible Subject Matter Communications (continued) #4 - complaints by an Offerer that the Designated Contact has not been responsive filed in writing to Counsel’s Office #5 - negotiation of a Procurement Contact after tentative award #6 - review of a procurement contract award (debriefings)

Permissible Subject Matter Communications #7 (a) – (d) #7 - protests, appeals or other review proceedings, such as judicial proceedings or allegations of improper conduct. Category includes the ability of an Offerer to file a written protest, appeal or complaint to OSC during the process of contract approval

Review and Investigation Process Whether a Contact is impermissible and must be reported/referred for investigation depends on the person’s role in the procurement Remember that the Law limits the Offerer’s permissible Contacts Four principal roles in the procurement process

Four Principal Roles in the Procurement Process Designated Contact(s) – those employees specifically named to receive all communications from the Offerers during the Restricted Period, including Contacts report/refer all Contacts that violate Public Officers Law or Penal Law

Four Principal Roles in the Procurement Process Permissible Subject Matter Communications those employees who may receive only specific subject matter communications during Restricted Period report/refer all Contacts that are outside of the specific subject matter

Four Principal Roles in the Procurement Process All other employees of procuring entity may only receive factual inquiries (not Contacts) report/refer all Contacts Control agencies and other governmental entities only may receive specific subject matter Contacts from Offerer during the Restricted Period report/refer all Contacts that are outside of the specific subject matter SFL section 139-j(8) requires any employee of a governmental entity that is not the procuring governmental entity who becomes aware that an Offerer has violated the permissible contacts requirements to immediately notify its ethics officer, inspector general (if any) or other official of its agency. Such person shall in turn notify the official responsible for investigating at the procuring governmental agency. Control agencies can also receive factual inquiries.

Offerer can always Contact Designated Contact Net Result Offerer can always Contact Designated Contact Offerer cannot Contact other employees or governmental entities unless falls within one of the permissible subject matters (SFL §139-j(4)) For example, okay to file written protest or complaint with OSC, but not to otherwise Contact Cannot Contact DOB to complain about a procurement

What is the Report/Referral Process? Each Governmental Entity is obligated to develop policies and procedures on the review and investigation process Process will identify who is obligated to review and investigate in accordance with the law At OGS, the process is set out on the internet. Indicate what we require

Review and Investigation Offerer is given reasonable notice that an investigation is ongoing and an opportunity to be heard Purpose is to determine - if an impermissible Contact occurred; - who made the impermissible Contact; and - whether the Offerer’s impermissible Contact was knowing and willful

1st Finding If there is a finding that an Offerer knowingly and willfully violated the requirements about permissible Contacts, Offerer is determined to be “non-responsible” and no award. However, award can be made if two specific statutory requirements are established First finding of non-responsibility results in the Offerer being listed on the OGS maintained list of bidders determined to be non-responsible

2nd Finding Second finding of non-responsibility within four year period results in debarment of Offerer Offerer is listed on the OGS maintained list of bidders debarred due to violations of this statute Offerer ineligible to submit a proposal or be awarded any Procurement Contract for a period of four years from the second determination Note that it is NOT 2 findings with the same agency. It is 2 findings across covered parties.

Notification Requirement Immediately notify OGS if an Offerer is determined to be non-responsible or debarred under this law Office of the General Counsel NYS Office of General Services 41st Floor - Corning Tower Albany, New York 12242 LegalServicesWeb@ogs.state.ny.us Telephone (518) 474-5988 Facsimile (518) 473-4973

Review the kinds of transactions commonly engage Recipe for Success for Governmental Entities Review the kinds of transactions commonly engage in and determine the scope of application for State Finance Law Undertake business analysis of your existing policies and procedures for conducting procurement - You may find that you already conduct the functional equivalent Single point of contact = Designated Contact Requirement to record all significant actions

Review procurement policy for clarity on when a Recipe for Success Review procurement policy for clarity on when a procurement is commenced, especially non- competitive procurements (i.e., single and sole source) Identify your review proceeding and dispute resolution proceeding and make known to the business community

Review solicitation documents to ensure clearly Recipe for Success Review solicitation documents to ensure clearly address the permissible subject matter categories - Formalize processes used to exchange information with the business community - Incorporate the summary of policy, certification, affirmation and non- responsibility requirements into all relevant procurement documents

Be familiar with your agency’s required policies Recipe for Success Be familiar with your agency’s required policies and procedures, such as - Determining Designated Contacts - Policy on permissible Contacts - Policy on review and investigation of possible impermissible Contacts - Policy on notifying OGS about SFL §§139-j and 139-k non-responsibility determinations and debarment

Provide training and access to resources to Recipe for Success Provide training and access to resources to staff – especially on the Restricted Period and the need to direct communications to the Designated Contacts Provide information to business community on these new requirements - use solicitation and other means

Questions ?

Office of General Services lisa.fox@ogs.state.ny.us (518) 474-0571 Presenter’s Contact Information Lisa Fox Legal Services Office of General Services lisa.fox@ogs.state.ny.us (518) 474-0571 OGS Website: www.ogs.state.ny.us