New York Laws
Article 10 - New York City Educational Construction Fund
458 - Letting of Construction Contracts.

§ 458. Letting of construction contracts. 1. Any contract let by the
fund or by any letting agency on behalf of the fund for the
construction, reconstruction, rehabilitation or improvement of a
combined occupancy structure or of the school portion thereof, shall be
in conformity with the provisions of section one hundred one of the
general municipal law.

2. Except as otherwise provided in section two hundred twenty-two of
the labor law, every contract, lease or other agreement entered into by
or on behalf of the fund for the acquisition, lease, construction,
reconstruction, rehabilitation or improvement of the school portion of
the work in any combined occupancy structure shall contain a provision
that, when the entire cost of any such contemplated construction,
reconstruction, rehabilitation or improvement for the school portion of
the work shall exceed three million dollars in the counties of the
Bronx, Kings, New York, Queens, and Richmond; one million five hundred
thousand dollars in the counties of Nassau, Suffolk and Westchester; and
five hundred thousand dollars in all other counties within the state,
separate specifications shall be prepared for the following three
subdivisions of the work on the school portion to be performed:

a. Plumbing and gas fitting;

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

c. Electric wiring and standard illuminating fixtures.

Such specifications shall be drawn so as to permit the letting of
separate and independent contracts for each of the above three
subdivisions of work. Within the above three subdivisions of work, any
equipment, apparatus and/or installations which shall be designed to
service the entire combined occupancy structure shall be included within
the school portion of the work or let as separate and independent
contracts even if physically located within the non-school portion of
the work. Except as otherwise provided by the public housing law, the
provisions of which shall apply when the developer is the New York city
housing authority, every developer or general contractor undertaking the
construction, reconstruction, rehabilitation or improvement of any such
combined occupancy structure pursuant to or in furtherance of the
provisions of this article shall let separate contracts to the lowest
responsible bidder for the three subdivisions of the above specified
work to persons, firms or corporations approved by the chairman of the
fund as being qualified, responsible and reliable bidders engaged in
these classes of work. All such qualified bidders engaged in the above
specified work shall be entitled to bid and to receive, upon request, a
copy of the plans and specifications. All such bids shall be submitted
to the fund and shall be opened publicly at a stated time and place.

2-a. Each bidder on a public work contract, where the preparation of
separate specifications is not required, shall submit with its bid a
separate sealed list that names each subcontractor that the bidder will
use to perform work on the contract, and the agreed-upon amount to be
paid to each, for: a. plumbing and gas fitting, b. steam heating, hot
water heating, ventilating and air conditioning apparatus and c.
electric wiring and standard illuminating fixtures. After the low bid is
announced, the sealed list of subcontractors submitted with such low bid
shall be opened and the names of such subcontractors shall be announced,
and thereafter any change of subcontractor or agreed-upon amount to be
paid to each shall require the approval of the public owner, upon a
showing presented to the public owner of legitimate construction need
for such change, which shall be open to public inspection. Legitimate
construction need shall include, but not be limited to, a change in
project specifications, a change in construction material costs, a

change to subcontractor status as determined pursuant to paragraph (e)
of subdivision two of section two hundred twenty-two of the labor law,
or the subcontractor has become otherwise unwilling, unable or
unavailable to perform the subcontract. The sealed lists of
subcontractors submitted by all other bidders shall be returned to them
unopened after the contract award.

3. a. In addition to other bond or bonds, if any, required by law for
the completion of the school portion of a combined occupancy structure,
or in the absence of any such requirement, the fund shall nevertheless
require, prior to the approval of any lease or other agreement providing
for the construction, reconstruction, rehabilitation or improvement of
any combined occupancy structure, that the developer, if other than the
New York city housing authority, or general contractor, furnish a bond
guaranteeing prompt payment of moneys due to all persons furnishing
labor or materials to or for the person furnishing said bond or to his
subcontractors in the prosecution of the entire work provided for in
such lease or other agreement. Whenever the developer is the New York
city housing authority, it shall require each of its contractors to
furnish such bonds to said authority and fund with respect to the work
to be performed and materials supplied by such contractor, and no
separate or other payment bond shall be required to be furnished to the
fund. In those instances where the developer or general contractor is an
agency of the state or a public-benefit corporation created by an act of
the state legislature and in instances where said developer or general
contractor or the guarantor of payment of the construction costs of the
non-school portion of the combined "occupancy structure" is a public
utility corporation or a bank, trust company or savings bank as defined
in section two of the banking law, or a national bank having its office
and principal place of business in this state, or a subsidiary of such a
bank or trust company of which at least eighty (80%) percent of whose
stock is owned by it, the said developer or general contractor shall
only be required to furnish said payment bond with respect to the school
portion of the combined occupancy structure. In such instances, the said
payment bond shall not be required by the fund with respect to the
non-school portion of the combined occupancy structure, but, in lieu
thereof, such fund shall require said agency, public benefit
corporation, public utility corporation or banking institution, as the
case may be to guarantee payment of all construction costs with respect
to the non-school portion of the combined occupancy structure.

b. A copy of such payment bond shall be kept in the office of the
chairman of the fund and a copy shall also be kept in the office of the
board of education; such copies shall be open to public inspection.

c. Every person who has furnished labor or material, to or for the
developer or contractor furnishing such payment bond or to his or her
subcontractors in the prosecution of the work provided for in the lease
or other agreement for which said bond is furnished and who has not been
paid in full therefor before the expiration of a period of ninety days
after the day on which the last of the labor was performed or material
was furnished by him or her for which the claim is made, shall have the
right to sue on such payment bond in his or her own name for the amount,
or the balance thereof, unpaid at the time of commencement of the
action; provided, however, that a person having a direct contractual
relationship with a subcontractor of the developer or contractor
furnishing the payment bond but no contractual relationship express or
implied with such developer or contractor shall not have a right of
action upon the bond unless he or she shall have given written notice to
such developer or contractor furnishing the bond within ninety days from
the date on which the last of the labor was performed or the last of the

material was furnished, for which his or her claim is made, stating with
substantial accuracy the amount claimed and the name of the party to
whom the material was furnished or for whom the labor was performed. The
notice shall be served by delivering the same personally to the
developer or contractor furnishing said bond or by mailing the same by
registered mail, postage prepaid, in an envelope addressed to such
developer or contractor at any place where he maintains an office or
conducts his or her business or at his or her residence.