ASSEMBLY, No. 557
STATE OF NEW JERSEY
PRE-FILED FOR INTRODUCTION IN THE 2008 SESSION
Assemblyman RONALD S. DANCER
District 30 (Burlington, Mercer, Monmouth and Ocean)
Assemblyman UPENDRA J. CHIVUKULA
District 17 (Middlesex and Somerset)
Assemblyman Green, Assemblywoman Evans, Assemblyman Schaer, Senators Buono and Lance
Repeals bidding requirement for local public contracts to allow bidders to avoid unresponsive bid if they inadvertently omit business registration from bid proposal provided that bidder was registered before bid submission deadline.
CURRENT VERSION OF TEXT
As amended by the General Assembly on September 25, 2008.
An Act concerning local public contracts and amending P.L.1999, c.39 and P.L.2001, c.134.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 2 of P.L.1999, c.39 (C.40A:11-23.2) is amended to read as follows:
2. When required by the bid plans and specifications, the following requirements shall be considered mandatory items to be submitted at the time specified by the contracting unit for the receipt of the bids; the failure to submit any one of the mandatory items shall be deemed a fatal defect that shall render the bid proposal unresponsive and that cannot be cured by the governing body:
a. A guarantee to accompany the bid pursuant to section 21 of P.L.1971, c.198 (C.40A:11-21);
b. A certificate from a surety company pursuant to section 22 of P.L.1971, c.198 (C.40A:11-22);
c. A statement of corporate ownership pursuant to section 1 of P.L.1977, c.33 (C.52:25-24.2);
d. A listing of subcontractors pursuant to section 16 of P.L.1971, c.198 (C.40A:11-16);
e. A document provided by the contracting agent in the bid plans, specifications, or bid proposal documents for the bidder to acknowledge the bidder's receipt of any notice or revisions or addenda to the advertisement or bid documents; and
f. [A copy of the contractor's, and subcontractors' listed pursuant to subsection d. of this section, business registration as required pursuant to section 1 of P.L.2001, c.134 (C.52:32-44).] (Deleted by amendment, P.L. , c. .) (pending before the Legislature as this bill)
(cf: P.L.2004, c.57, s.1)
2. Section 1 of P.L.2001, c.134 (C.52:32-44) is amended to read as follows:
1. a. For the purposes of this section:
1“Bid” or “request for proposal” means a publicly advertised, formal process used by a contracting agency to receive offers to provide goods or services or construct a construction project. It is not the same as an informal, non-advertised process of requesting quotations from contractors.
“Bid threshold” means the statutory amount over which a contracting agency must seek bids.1
"Business organization" means an individual, partnership, association, joint stock company, trust, corporation, or other legal business entity or successor thereof 1, but does not include a government agency or organization organized as a nonprofit entity1 2under 26U.S.C. sec. 501 (c)2;
"Business registration" means a business registration certificate issued by the 1Division of Revenue in the1 Department of the Treasury or such other form 1[or] of1 verification 1or proof of registration as may be approved by the Division1 that a contractor or subcontractor is registered with the Department of the Treasury;
1“Contract” means any agreement, including but not limited to a purchase order or a formal agreement for the provision of goods, performance of services, or construction of a construction project, which is a legally binding relationship enforceable by law, between a contractor and a contracting agency that agrees to compensate the contractor, as defined by and subject to the terms and conditions of the agreement; and where the goods that are received, services that are delivered, and construction is constructed is within the geographic borders of the State of New Jersey; and where:
(1) the value of a single contract with the contractor is in excess of 15 percent of the amount of the contracting agency’s bid threshold; or
(2) when the aggregate amount of contracts with the contractor, during the fiscal year of the contracting agency, exceeds 15 percent of the amount of the contracting agency’s bid threshold.1
"Contractor" means a business organization that seeks to enter, or has entered into, a contract 1[to provide goods or services or to construct a construction project]1 with a contracting agency;
"Contracting agency" means the principal departments in the Executive Branch of the State Government, and any division, board, bureau, office, commission or other instrumentality within or created by such department, or any independent State authority, commission, instrumentality or agency, or any State college or university, any county college, or any local unit;
"Local unit" means any contracting unit as defined pursuant to section 2 of P.L.1971, c.198 (C.40A:11-2), any board of education as defined pursuant to N.J.S.18A:18A-2, a private firm that has entered into a contract with a public entity for the provision of water supply services pursuant to P.L.1995, c.101 (C.58:26-19 et al.), a private firm or public authority that has entered into a contract with a public entity for the provision of wastewater treatment service pursuant to P.L.1995, c.216 (C.58:27-19 et al.), and a duly incorporated nonprofit association that entered into a contract with the governing body of a city of the first class for the provision of wastewater treatment services pursuant to P.L.1995, c.216 (C.58:27-19 et al.);
"Subcontractor" means any business organization that is not a contractor that knowingly 1[provides goods or performs services for] enters into a contract 2,2 or constructs a construction project 2,2 with1 a contractor or another subcontractor in the fulfillment of a contract issued by a contracting agency. 1In the case of a construction contract, “subcontractor” shall mean only those subcontractors who are required by law to be named in the submission of a bid.1
b. 1[No contract shall be entered into by any contracting agency unless the contractor provides a copy of its ] 2[No contractor shall enter into a contract with any contracting agency unless that contractor has been issued proof of1 business registration in accordance with the following schedule:
(1) In response to a request for bids or a request for proposals, 1[at] before1 the time a bid or proposal is submitted 1[. In its sole discretion, a local contracting unit may waive this requirement and allow the contractor a reasonable amount of time to submit its business registration, provided that the business registration was obtained on or prior to the last date for submission of bids or proposals]1 ; or
(2) For all other transactions, before the issuance of a purchase order or other contracting document.]2 1[In its sole discretion, the contracting unit may waive this requirement if a business registration has been previously provided to the contracting agency.]1 2A contractor shall provide the contracting agency with the business registration of the contractor and that of any named subcontractor prior to the time a contract, purchase order, or other contracting document is awarded or authorized. At the sole option of the contracting agency, the requirement that a contractor provide proof of business registration may be fulfilled by the contractor providing the contracting agency sufficient information for the contracting agency to verify proof of registration of the contractor, or named subcontractors, through a computerized system maintained by the State.2
c. A subcontractor 1named in a bid or other proposal made by a contractor to a contracting agency1 shall provide a copy of its business registration to any contractor who shall [forward it to the contracting agency] 1provide it to the contracting agency pursuant to the provisions of subsection 2[i.] b.2 of this section1. No contract with a subcontractor shall be entered into by any contractor under any contract with a contracting agency unless the subcontractor first provides 1the contractor with1 proof of 1a1 valid business registration. 1[The contracting agency shall file all business registrations received by the contracting agency with other procurement documents related to the contract] For bids and requests for proposals, the contracting agency must retain the proof of business registration in the file where documents relating to the contract are maintained. For all other contracts, proofs of business registration shall be maintained in an alphabetical file1.
d. 1[A contract entered into by a contracting agency with a contractor shall include provisions under subsection b. of this section and this subsection for the contractor to comply with, and for the contractor to notify subcontractors by written notice to comply with subsection c. of this section. A contracting agency shall not be responsible for a contractor's failure to comply with this section.]1 The contractor shall maintain and submit to the contracting agency a list of subcontractors and their addresses that may be updated from time to time during the course of the contract performance. A complete and accurate list shall be submitted before final payment is made for goods provided or services rendered or for construction of a construction project under the contract. 1A contracting agency shall not be responsible for a contractor’s failure to comply with this 2[section] subsection2 1.
e. 1[Notice of the provisions of this section shall be included by the contracting agency] The Department of the Treasury shall provide each contracting agency with appropriate language reflecting the obligations of contractors and subcontractors under this section that the contracting agency shall include1 in any 1contract document,1 bid specification, requests for proposals, or other documents notifying potential contractors of 1contract1 opportunities 1[to provide goods or perform services for] with1 a contracting agency.
f. Nothing in this section shall in any way alter the provisions or change the responsibilities or obligations of casino industry licensees as set forth in section 92 of P.L.1977, c.110 (C.5:12-92).
g. (1) A contractor or a contractor with a subcontractor that has entered into a contract with a contracting agency, and each of their affiliates, shall collect and remit to the Director of the Division of Taxation in the Department of the Treasury the use tax due pursuant to the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.) on all their 1taxable1 sales of tangible personal property delivered into this State.
(2) A contracting agency entering into a contract with a contractor, or a contractor with a subcontractor, shall include in its contract 1[to provide goods or perform services or to construct a construction project]1 with that contractor, or a contractor with a subcontractor, for the term of the contract, a requirement that the contractor or subcontractor and each of their affiliates shall collect and remit to the Director of the Division of Taxation in the Department of the Treasury the use tax due pursuant to the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.) on all their sales of tangible personal property delivered into this State.
(3) For the purposes of this subsection, "affiliate” means any entity that (1) directly, indirectly, or constructively controls another entity, (2) is directly, indirectly, or constructively controlled by another entity, or (3) is subject to the control of a common entity. For purposes of this subsection an entity controls another entity if it owns, directly or individually, more than 50% of the ownership interest in that entity.
h. The State Treasurer may adopt regulations pursuant to the "Administrative Procedure Act", P.L.1968, c.410 (C.52:14B-1 et seq.) as are necessary to administer the provisions of this act.
1i. 2[Proof of business registration of a contractor shall be subject to the following provisions:
(1) A contractor shall provide the contracting agency with the business registration of the contractor and that of any named subcontractor prior to the time a contract, purchase order, or other contracting document is awarded or authorized.
(2) The contracting agency may include a requirement to submit proof of a business registration with a bid or request for proposals; provided, however, that any failure to provide proof of business registration with the submission of a bid or other proposal document shall be considered a curable defect, which shall only be cured by the contractor providing the proof of business registration to the contracting agency prior to the time a contract, purchase order, or other contracting document is awarded or authorized.
(3) At the sole option of the contracting agency, the requirement that a contractor provide proof of business registration may be fulfilled by the contractor providing the contracting agency sufficient information for the contracting agency to verify proof of registration of the contractor or listed subcontractors through a computerized system maintained by the State.
j.]2 If a contractor fails to provide proof of business registration upon request by the contracting agency for a contract that does not require bidding or a request for proposals, and the contracting agency determines that the purpose of that contract is of a proprietary nature with a contractor that does not have a business presence in New Jersey, the contracting agency shall provide the Division of Revenue, within 10 days of executing the contract, a copy of the contract, evidence of the contractor’s taxpayer identification number, and a signed certification attesting to the proprietary nature of the contract and representing that the contracting agency made a diligent effort to obtain proof of a business registration from the contractor.
2[k.] j.2 When a contracting agency enters into a contract with a contractor under a contract issued by State of New Jersey Cooperative Purchasing Program, or any other authorized cooperative purchasing system, the contracting agency awarding the initial contract shall receive and file the proof of business registration. Contract documents issued under a cooperative purchasing agreement shall identify the contract and the contracting agency awarding the contract.
2[l.] k.2 In situations of an emergent nature, a contracting agency may enter into a contract with a business organization, provided that the contractor agrees to provide a business registration within two weeks of the execution of the contract.1 2The contracting agency shall not pay the business organization for goods or services provided until such time as the organization provides proof of business registration as set forth in this section. Failure to pay the business organization until proof of business registration is received shall not be grounds for the agency being liable for payment.2
(cf: P.L.2004, c.57, s.3)
3. This act shall take effect immediately.