ASSEMBLY COMMUNITY DEVELOPMENT AND WOMEN'S AFFAIRS COMMITTEE

STATEMENT TO

ASSEMBLY, No. 4586

with committee amendments

STATE OF NEW JERSEY

DATED:  SEPTEMBER 23, 2024

      The Assembly Community Development and Women's Affairs Committee reports favorably and with committee amendments Assembly Bill No. 4586.

      As amended by the committee, the bill establishes the “Minority and Women-Owned Businesses State Contractor Remedies Act,” amends the “Set-Aside Act for Small Businesses, Female Businesses, and Minority Businesses,” and repeals various sections of the statutory law.

      The “Minority and Women-Owned Businesses State Contractor Remedies Act” establishes a new process for determining preference in awarding State agency and State contracting unit contracts.  State agencies and State contracting units are required to develop a plan for the fiscal year following the effective date of the bill and each fiscal year thereafter to encourage minority and women-owned businesses to submit proposals and encourage the awarding of contracts to those businesses.  The bill establishes contract utilization goals for all State agencies and State contracting units based on the New Jersey Disparity Study on the Availability and Utilization of Small, Minority, Women, and Service-Disabled Veteran-Owned Businesses published in January of 2024.  The State agency or State contracting unit is required to implement appropriate adjustments determined by subsequent statistical analyses of the disparities between the availability of and the utilization of contracts held by minority-owned businesses and female-owned businesses. In an effort to achieve the goals, the agency may establish bid criteria for contracts that result in a preference being afforded to minority and women-owned businesses. 

      State agencies are required to make a good faith effort to attain the goals set forth in the bill.  If the agency fails to make a good faith effort, a remedial action plan will be submitted to the Chief Diversity Officer.  If it is determined by the Chief that the agency did not act in good faith to implement the remedial action plan within one year, the Chief may make the remedial action plan public to encourage implementation.  If implementation still does not occur, the Chief may require that some or all of the agency’s procurement be placed under the direction and control of another agency.  Prime contractors are also required to make a good faith effort to attain the subcontractor goals set forth in the bill.  Failure by a prime contractor to demonstrate a good faith effort may result in grounds for rejection of bids made by the prime contractor.

      The bill amends the “Set-Aside Act for Small Businesses, Female Businesses, and Minority Businesses” to only be applicable to small businesses by removing mentions of female and minority-owned businesses.  The bill shifts chief, office, and departmental duties from the Chief of the Office of Small Business Assistance, the Office of Small Business Assistance, and the Department of Commerce and Economic Development to the Chief Diversity Officer, the Office of Diversity and Inclusion, and the Department of the Treasury.  The bill changes the set-aside goals for small businesses from 15 percent to 25 percent and removes goals for minority and women-owned businesses.

      The bill establishes a goal that State agencies and State contracting unit award at least 30 percent of their contracts to socially and economically disadvantaged businesses.

      The bill repeals the law establishing compliance calculations for contracting agencies awarding contracts to minority or women-owned businesses, P.L.1995, c.39 (C.52:32-22.1), and repeals the law establishing the goal of giving due consideration to veteran-owned businesses and the requirement that strategies be identified to expand the number of veteran-owned businesses interested in and eligible to benefit from State procurement, P.L.2011, c.147 (C.52:32-52).

COMMITTEE AMENDMENTS:

      The committee amended the bill to include “State contracting units” in addition to State agencies as applicable to the provisions of the bill, define “State contracting units,” and clarify that State contracting units are required to implement appropriate adjustments determined by subsequent statistical analyses of the disparities between the availability of and the utilization of contracts held by minority-owned businesses and female-owned businesses.