SENATE, No. 2536

STATE OF NEW JERSEY

215th LEGISLATURE

INTRODUCED FEBRUARY 4, 2013

 


 

Sponsored by:

Senator† STEPHEN M. SWEENEY

District 3 (Cumberland, Gloucester and Salem)

 

Co-Sponsored by:

Senator Weinberg

 

 

 

 

SYNOPSIS

†††† Authorizes deployment of integrity monitors in implementation of certain Hurricane Sandy recovery and rebuilding projects.

 

CURRENT VERSION OF TEXT

†††† As introduced.

††


An Act authorizing the deployment of integrity monitors in the implementation of certain Hurricane Sandy recovery and rebuilding projects, supplementing Title 52 of the Revised Statutes.

 

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

 

†††† 1.††† The Legislature finds and declares that:

†††† a.†††† Hurricane Sandy has inflicted approximately $30,000,000,000 worth of damage upon the State and exposed the need for more than $7,000,000,000 in mitigation efforts to buttress the Stateís defenses from future storms, according to the Governorís initial estimates of November of 2012;

†††† b.††† The State of New Jersey, with the assistance of the federal government, shall endeavor to repair, rebuild, and revive the portions of the State devastated by Hurricane Sandy;

†††† c.†††† The State of New Jersey is duty bound to its residents to ensure that all resources dedicated to the recovery from Hurricane Sandy be applied in an efficient manner and that the State should take all necessary precaution to prevent, detect, and remediate waste, fraud, and abuse;

†††† d.††† Given the severity of the damage caused by Hurricane Sandy and the magnitude of the resources necessary to begin the recovery process there is a potential for the influx of federal assistance to stretch the Stateís capacity for efficient oversight; and

†††† e.†††† The use of integrity monitors as independent oversight providers may be an effective measure to supplement the Stateís existing compliance control mechanisms to prevent the inefficient expenditure of Hurricane Sandy recovery resources.

 

†††† 2.††† a.† (1)† For each State contract involving a Hurricane Sandy recovery and rebuilding project, the State Treasurer shall cause the following contractual conditions to be included in the contract:

†††† The contract recipient shall procure the services of an integrity monitor from the qualified integrity monitor database established pursuant to subsection b. of this section during the initial implementation of the contract, unless this condition is waived by the State Treasurer upon a determination of sufficient contract recipient compliance controls; and

†††† The State Treasurer shall have the authority to require that a contract recipient procure the services of an integrity monitor from the qualified integrity monitor database established pursuant to subsection b. of this section for any duration of the contract upon a determination by the State Treasurer that an integrity monitor is necessary to alleviate potential or ongoing inefficiency or that the size or nature of the contract makes the procurement of an integrity monitor prudent.

†††† (2)† For Hurricane Sandy recovery and rebuilding projects not involving a State contract, the State Treasurer shall procure the services of an integrity monitor from the qualified integrity monitor database established pursuant to subsection b. of this section during the initial implementation of the Hurricane Sandy recovery and rebuilding project, unless this condition is waived by the State Treasurer upon a determination of sufficient funding recipient compliance controls.

†††† For Hurricane Sandy recovery and rebuilding projects not involving a State contract, the State Treasurer shall have the authority to procure the services of an integrity monitor from the qualified integrity monitor database established pursuant to subsection b. of this section for any duration of a Hurricane Sandy recovery and rebuilding project upon a determination by the State Treasurer that an integrity monitor is necessary to alleviate potential or ongoing inefficiency or that the size or nature of the Hurricane Sandy recovery and rebuilding project makes the procurement of an integrity monitor prudent.

†††† (3)† If the State Treasurer issues an integrity monitor service condition waiver pursuant to this subsection, the State Treasurer shall provide the Senate President and the Speaker of the General Assembly a report in accordance with section 2 of P.L.1991, c.164 (C.52:14-19.1), which report shall detail the reasoning associated with the waiver and the contract or funding recipientís compliance controls.† The report shall be due within ten business days of the issuance of the waiver.

†††† b.††† To facilitate the use of integrity monitors pursuant to subsection a. of this section, the State Treasurer shall establish a qualified integrity monitor database which shall identify the integrity monitors that that State Treasurer has determined to be qualified to provide integrity monitor services.† The qualified integrity monitor database shall be a publicly accessible database.

†††† The State Treasurer shall administer a transparent process for determining the qualification of an integrity monitor, which determinations shall be based on a range of meritorious factors established by the State Treasurer that emphasize the capacity of integrity monitors to prevent, detect, and remediate inefficiency and malfeasance in the implementation of Hurricane Sandy recovery and rebuilding projects.† The State Treasurerís decision and reasoning as to the qualification of an integrity monitor for inclusion in the qualified integrity monitor database shall be made available through the database.

†††† c.†††† An integrity monitor shall be subject to the malfeasance and inefficiency reporting protocol imposed by the State Treasurer.† The State Treasurerís reporting protocol shall require an integrity monitor upon a finding of a likely criminal violation to make a report forthwith to the Attorney General.

†††† d.††† For purposes of executing the oversight functions of an integrity monitor relative to accessing State government records, an integrity monitor shall be deemed to be an agent of State government and shall be afforded all rights of access associated thereto.† Provided however, if an integrity monitorís access to State government records may compromise sensitive information the chief executive officer of the entity in possession of the State government records may limit the integrity monitorís access accordingly.† If a chief executive officer denies sensitive information to an integrity monitor pursuant to this subsection, the chief executive officer shall provide the integrity monitor with its reasoning for the denial in a written notice.

†††† e.†††† To expedite the implementation of integrity monitors for Hurricane Sandy recovery and rebuilding projects, the State Treasurerís procurement of integrity monitors shall be exempt from public contracting laws, rules, and regulations, except that this exemption shall be contingent on the transparent administration of a procurement process wherein the State Treasurer: publicly posts the need and qualification for integrity monitor service contracts, selects an integrity monitor service provider from integrity monitors qualified pursuant to subsection b. of this section that respond to a particular public posting, and maintains the application of conflict of interest provisions associated with public contracting laws, rules, and regulations.

†††† f.†††† On the first business day of each even numbered month each integrity monitor shall provide to the State Treasurer for distribution to the †Legislature, in accordance with section 2 of P.L.1991, c.164 (C.52:14-19.1), and the Governor a report detailing the integrity monitorís provision of services during the two month period second preceding the due date of the report and any previously unreported provision of services, which shall include, but not be limited to, detailed findings concerning the integrity monitorís provision of services and recommendations for corrective or remedial action relative to findings of malfeasance and inefficiency.† The report shall include a privilege log which shall detail each denial of sensitive information that the integrity monitor exercises in preparing the report for transmission to the Legislature and the Governor pursuant to this subsection.† The report shall not include any information which may compromise a potential criminal investigation or prosecution or any proprietary information.† The State Treasurer shall have the authority to specify reporting requirements for an integrity monitor pursuant to this subsection relative to the specific services provided by an integrity monitor.†

†††† No report shall become due for an integrity monitor until at least three months after commencing duties as an integrity monitor.† The State Treasurer shall provide the integrity monitor reports received pursuant to this subsection to the Legislature and the Governor within ten business days of receipt.

†††† g.†††† As used in this section:

†††† ďHurricane Sandy recovery and rebuilding projectĒ means (1) the use of funds provided pursuant to federal legislation enacted by the 113th Congress of the United States of America which contains, but is not limited to, disaster assistance for impacts associated with Hurricane Sandy, or other major storms, in New Jersey; and (2) the use of funds disbursed through the State treasury for undertakings to address the damage associated with the State of Emergency identified in the Governorís Executive Order 104, dated October 27, 2012, concerning Hurricane Sandy, which undertakings shall include emergency operations, loss reimbursement, repairs, rebuilding, restorations, reconstruction, removal of debris, temporary housing, household assistance, relief, hazard mitigation improvements, construction, and other recovery and rebuilding activities deemed to be a Hurricane Sandy recovery and rebuilding project by the State Treasurer.

†††† ďIntegrity monitorĒ means a private entity that contracts to provide services to ensure legal compliance, detect misconduct, and promote best practices in the administration of Hurricane Sandy recovery and rebuilding projects, which services may include, but shall not be limited to, legal, investigative, accounting, engineering, other professional specialties, risk assessment, developing compliance system constructs, loss prevention, and monitoring.

†††† ďSensitive informationĒ means information which if disclosed to an integrity monitor would jeopardize compliance with State or federal law, threaten public health, welfare, or safety, or harm the competitive economic position of a party.

 

†††† 3.††† This act shall take effect immediately.

 

 

STATEMENT

 

†††† This bill authorizes the deployment of integrity monitors in the implementation of Hurricane Sandy recovery and rebuilding projects.† The purpose of this bill is to reinforce the Stateís compliance control mechanisms given the potential for the pending influx of federal assistance to strain the Stateís capacity for efficient oversight.

Authority to Deploy Integrity Monitors

†††† The bill authorizes the State Treasurer to cause the use of integrity monitors in two classes of Hurricane Sandy recovery and rebuilding projects, those involving State contracts and those not involving State contracts.

†††† For Hurricane Sandy recovery and rebuilding projects involving State contracts, the bill authorizes the State Treasurer to make the use of an integrity monitor a contractual condition that may be exercised to alleviate potential or ongoing inefficiency or in caution due to the size or nature of the contract.† The bill makes the use of an integrity monitor during the initial stages of a contractís implementation the default scenario, unless waived by the State Treasurer upon a determination of sufficient compliance controls.

†††† For Hurricane Sandy recovery and rebuilding projects not involving State contracts, the bill authorizes the State Treasurer to procure the services of an integrity monitor to service the project to alleviate potential or ongoing inefficiency or in caution due to the size or nature of the project.† The bill makes the use of an integrity monitor during the initial stages of a projectís implementation the default scenario, unless waived by the State Treasurer upon a determination of sufficient compliance controls.

Database of Qualified Integrity Monitors

†††† To facilitate the use of integrity monitors, the bill charges the State Treasurer with establishing a qualified integrity monitor database that is accessible to the public.† The bill requires the State Treasurer to administer a transparent process for qualifying integrity monitors for inclusion in the database.† The bill directs the State Treasurer to base integrity monitor qualification on meritorious factors established by the State Treasurer, which emphasize the capacity of integrity monitors to prevent, detect, and remediate inefficiency and malfeasance in Hurricane Sandy recovery and rebuilding projects.† The bill denotes that the State Treasurerís decisions and reasoning as to integrity monitor qualifications are to be made available through the database.

Reporting Protocol

†††† The bill subjects all integrity monitors to malfeasance and inefficiency reporting protocol imposed by the State Treasurer.† The bill specifies that the State Treasurerís reporting protocol must require an integrity monitor to expediently report a finding of a likely criminal violation to the Attorney General.

†††† The bill also includes a two month reporting requirement for integrity monitors for transmission to the Legislature and the Governor, through the State Treasurer.† The bill specifies that the integrity monitorís report must detail the integrity monitorís provision of services for the second most recently closed two month period.† The bill requires that the report must include a privilege log that details the denial of any sensitive information to the Legislature and Governor.† The bill denotes that the integrity monitorís report cannot include any information that may compromise a criminal investigation or proprietary information.† The bill authorizes the State Treasurer to contour the reporting detail relative to the specific services provided by an integrity monitor.

Key Definitional Terms and Administrative Matters

†††† Generally, the bill defines a Hurricane Sandy recovery and rebuilding project as a project relying on: (i) federal funding provided through Hurricane Sandy, or other major storm, disaster assistance legislation enacted by the current Congress; or (ii) funding supplied through the State treasury to address the damage associated with Hurricane Sandy.

†††† The bill defines an integrity monitor as a private service provider that strives to ensure legal compliance, detect misconduct, and promote best administrative practices.† The bill denotes that the types of services provided by an integrity monitor include legal, investigative, accounting, engineering, other professional specialties, risk assessment, developing compliance system constructs, loss prevention, and monitoring.

†††† The bill qualifies an integrity monitor as a State agent for purposes of accessing State government records, except that access may be limited by chief executive officer of the possessing State entity if access may compromise sensitive information.† Generally, the bill defines sensitive information as information that if disclosed may violate State or federal law, threaten public welfare, or compromise a partyís economic position.

†††† The bill allows the State Treasurerís procurement of integrity monitors to bypass public procurement laws to expedite implementation.† However, the billís exemption from public procurement law is contingent on the State Treasurerís transparent administration of a procurement process that satisfies three conditions: (i) public posting of available integrity monitor service contracts and the qualifications thereto; (ii) the selection of an integrity monitor from qualified candidates that respond to a posting; and (iii) application of standing conflict of interest law in the field of public procurement.