New York Laws
Title 6 - The New York City School Construction Authority Act
1735 - Certain Contracts of the Authority.

* § 1735. Certain contracts of the authority. 1. Notwithstanding the
provisions of paragraph b of subdivision one of section seventeen
hundred thirty-four of this title, the award of construction contracts
by the authority between July first, nineteen hundred eighty-nine and
June thirtieth, two thousand twenty-four, shall not be subject to the
provisions of section one hundred one of the general municipal law.

2. Notice of the invitation for bids for contracts to be awarded
pursuant to this section shall state the time and place of the receipt
and opening of bids.

3. All bidders shall submit to the authority, prior to the opening of
a bid for the award of a contract under this section, a sealed list
identifying the names of each subcontractor each contractor proposes to
utilize under the contract for the performance of the following
subdivisions of work:

a. Plumbing and gas fitting;

b. Steam heating, hot water heating, ventilating and air conditioning
apparatus; and

c. Electric wiring and standard illuminating fixtures.

The low bidder shall specify in such list the estimated value to be
paid each such subcontractor for the work to be performed by such
subcontractor. After the authority has announced the low bidder at the
bid opening, the authority shall open only such low bidder's separate
sealed list and shall read aloud such subcontractors listed therein. All
such sealed lists except those of the low bidder shall be returned
unopened to their respective contractors following the awarding of a
contract.

4. The authority shall establish a committee to review and report on
contracts issued pursuant to this section and on the procedures and
methodology of the authority in awarding such contracts. The review
shall include, but not be limited to, the degree to which contractors
awarded contracts pursuant to such paragraph, and the subcontractors
utilized by them, utilize employees who are represented by labor
organizations, comply with existing labor standards, maintain harmonious
labor relations and recognize state approved apprentice programs. The
committee shall, from time to time, issue economic and statistical
reports dealing with the costs of construction under this article. Such
reports shall deal with the costs of labor, material, equipment and
profit. The committee shall have no authority to approve or disapprove
contracts. The committee shall be composed of two representatives from
the authority, one representative from the board, two representatives
from construction-related labor organizations and two representatives
from the construction industry, at least one of whom shall be involved
in the subdivisions of work described in subdivision three of this
section. The president of the authority shall designate the members of
the committee, provided, however, that the president shall designate the
representatives of labor organizations from a list of names submitted by
the New York state AFL-CIO.

5. In awarding contracts pursuant to this section the authority shall,
in addition to the factors set forth in subdivision three of section
seventeen hundred thirty-four of this title, consider the following
factors when establishing a list of pre-qualified bidders for
construction work: (a) the degree to which a contractor or subcontractor
utilizes employees who are represented by a labor organization; (b) the
absence of any intentional misrepresentation with regard to lists of
subcontractors previously submitted pursuant to the provisions of
subdivision two of this section; and (c) the record of the bidder in
complying with existing labor standards, maintaining harmonious labor
relations and recognizing state approved apprentice programs.

6. The authority shall provide in its construction, erection or
alteration contracts which implement a five year educational facilities
capital plan a provision that shall require each contractor to make
prompt payment to its subcontractors performing each subdivision of work
listed in subdivision three of this section. Within seven calendar days
of the receipt of any payment from the authority, the contractor shall
pay to each such subcontractor that portion of the proceeds of such
payment representing the value of the work performed by such
subcontractor, based upon the actual value of the subcontract, which has
been approved and paid for by the authority, less an amount necessary to
satisfy any claims, liens or judgments against the subcontractor which
have not been suitably discharged and less any amount retained by the
contractor as provided herein. For such purpose, the subcontract may
provide that the contractor may retain not more than five per centum of
each payment to the subcontractor or not more than ten per centum of
each such payment if prior to entering into the subcontract the
subcontractor is unable or unwilling to provide, at the request of the
contractor, a performance bond and a labor and material bond both in the
amount of the subcontract.

At the time of making a payment to the contractor for work performed
by the subcontractors set forth in subdivision three of this section,
the authority shall file in its office for review a record of such
payment. If any such subcontractor shall notify the authority and the
contractor in writing that the contractor has failed to make a payment
to it as provided herein and the contractor shall fail, within five
calendar days after receipt of such notice, to furnish either proof of
such payment or notice that the amount claimed by the subcontractor is
in dispute, the authority shall withhold from amounts then or thereafter
becoming due and payable to the contractor, other than from amounts
becoming due and payable to the contractor representing the value of
work approved by the authority and performed by other subcontractors and
which the contractor is required to pay to such subcontractors within
seven calendar days as herein provided, an amount equal to one hundred
fifty percent of that portion of the authority's prior payment to the
contractor which the subcontractor claims to be due it, shall remit the
amount when and so withheld to the subcontractor and deduct such payment
from the amounts then otherwise due and payable to the contractor, which
payment shall, as between the contractor and the authority, be deemed a
payment by the authority to the contractor. In the event the contractor
shall notify the authority as above provided that the claim of the
subcontractor is in dispute, the authority shall withhold from amounts
then or thereafter becoming due and payable to the contractor, other
than from amounts becoming due and payable to the contractor
representing the value of work approved by the authority and performed
by other subcontractors and which the contractor is required to pay to
such subcontractors within seven calendar days as herein provided, an
amount equal to one hundred fifty percent of that portion of the
authority's prior payment to the contractor which the subcontractor
claims to be due it and deposit such amount when and so withheld in a
separate interest-bearing account pending resolution of the dispute, and
the amount so deposited together with the interest thereon shall be paid
to the party or parties ultimately determined to be entitled thereto, or
until the contractor and subcontractor shall otherwise agree as to the
disposition thereof. In the event the authority shall be required to
withhold amounts from a contractor for the benefit of more than one
subcontractor, the amounts so withheld shall be applied to or for such
subcontractors in the order in which the written notices of nonpayment
have been received by the authority, and if more than one such notice

was received on the same day, proportionately based upon the amount of
the subcontractor claims received on such day. Notwithstanding the
foregoing, in lieu of withholding such amount or amounts in dispute, the
contractor may post a bond or other form of undertaking guaranteeing
payment of such disputed amounts. Nothing herein contained shall prevent
the authority from commencing an interpleader action to determine
entitlement to a disputed payment in accordance with section one
thousand six of the civil practice law and rules, or any successor
provision thereto. In the event the authority does not withhold the
required amounts within sixty days after the written notification from
the subcontractor regarding failure of the contractor to make payment,
the subcontractor may file a lien under article two of the lien law as
the sole remedy in lieu of the remedy provided under this subdivision.

Payment to a subcontractor shall not relieve the contractor from
responsibility for the work covered by the payment. Except as otherwise
provided, nothing contained herein shall create any obligation on the
part of the authority to pay any subcontractor, nor shall anything
provided herein serve to create any relationship in contract or
otherwise, implied or expressed, between the subcontractor and the
authority.

The provisions of this subdivision shall not be applicable to the
subcontractors of a contractor whose contract is limited to the
performance of a single subdivision of work listed in subdivision three
of this section.

7. The provisions of this section shall cease to be in effect in the
event any of the provisions of this section shall be adjudged to be
invalid by the final judgment of a court of competent jurisdiction from
which judgment all appeals or applications for relief have been
exhausted or the time therefor has expired, provided, however, that such
appeals or applications are pursued promptly.

* NB Repealed June 30, 2024