Bill Text: NY S05229 | 2019-2020 | General Assembly | Introduced


Bill Title: Requires a bond, letter of credit or other form of collateral financial security for contractors and subcontractors where no public fund has been established for the financing of a public improvement.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2019-04-17 - REFERRED TO JUDICIARY [S05229 Detail]

Download: New_York-2019-S05229-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          5229
                               2019-2020 Regular Sessions
                    IN SENATE
                                     April 17, 2019
                                       ___________
        Introduced  by  Sen. BRESLIN -- read twice and ordered printed, and when
          printed to be committed to the Committee on Judiciary
        AN ACT to amend the lien law, in relation to requiring a bond, letter of
          credit or other form of collateral financial security for  contractors
          and  subcontractors  where no public fund has been established for the
          financing of a public improvement
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section 1. Section 5 of the lien law, as amended by chapter 155 of the
     2  laws of 2004, is amended to read as follows:
     3    §  5. Liens under contracts for public improvements. A person perform-
     4  ing labor for or furnishing  materials  to  a  contractor,  his  or  her
     5  subcontractor  or  legal representative, for the construction or demoli-
     6  tion of a public improvement pursuant to a contract by  such  contractor
     7  with  the  state  or  a  public corporation, and any trust fund to which
     8  benefits and wage supplements are due or payable for the benefit of such
     9  person performing labor, shall have a lien for the principal and  inter-
    10  est  of  the value or agreed price of such labor, including benefits and
    11  wage supplements due or payable for the benefit of any person performing
    12  labor, or materials upon the moneys of the state or of such  corporation
    13  applicable to the construction or demolition of such improvement, to the
    14  extent  of the amount due or to become due on such contract, and under a
    15  judgment of the court of claims awarded to the  contractor  for  damages
    16  arising  from  the  breach of such contract by the state, or awarded for
    17  furnishing labor or materials not contemplated by the provisions of said
    18  contract, upon filing a notice of lien as prescribed  in  this  article,
    19  except as hereinafter in this article provided. Where no public fund has
    20  been  established  for  the financing of a public improvement with esti-
    21  mated cost in excess of two hundred fifty thousand  dollars,  the  chief
    22  financial  officer  of the public owner shall require the private entity
    23  for whom the public improvement is being made to post, or  cause  to  be
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09505-01-9

        S. 5229                             2
     1  posted,  a  bond  or  [other  form of undertaking] a letter of credit or
     2  other form of collateral financial security approved  by  a  federal  or
     3  state  financial  regulator guaranteeing prompt payment of moneys due to
     4  the  contractor, his or her subcontractors and to all persons furnishing
     5  labor or materials to the contractor or his or her subcontractors in the
     6  prosecution of the work on the public improvement.
     7    § 2. This act  shall  take  effect  immediately  and  shall  apply  to
     8  contracts entered into on or after such effective date.
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