New York State Governor Andrew Cuomo recently took action on two bills relevant to minority- and women-owned businesses (MWBEs) in the state. While both bills are supported and seen as beneficial by many in the MWBE community, Cuomo only signed one, while vetoing the other bill.
The law Cuomo signed, which was passed by the state legislature in June of 2017, raises the threshold below which New York City agencies are allowed to award contracts to MWBEs through a discretionary or no-bid process to $150,000. Previously, the cap on such discretionary spending was $20,000. The increase brings the City's discretionary spending abilities closer to that of the state's, which has a $200,000 limit. The bill will also, according to the statement on the official website for the City of New York, allow the City to consider a firm's status as an MWBE when using "the best value procurement method."
New York City Mayor Bill de Blasio praised the new law, saying that it would "[ease] the burden of the time-consuming, bidding process for small purchases" and that the raised cap would contribute to further economic success for all New Yorkers.
The law Governor Cuomo vetoed, however, was a bill that would have eliminated the requirement that New York-certified MWBEs have a net worth of under $3.5 million. The bill was popular with not only MWBEs but also with the legislature, where it passed with bipartisan support.
The governor justified the veto by contending that the elimination of the net worth cap absent a new "corresponding limiting factor", the state was opening itself up to legal challenges. Rulings from the Supreme Court, he noted, state that government diversity initiatives like the MWBE program must be "narrowly tailored to remedy prior discrimination."
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