N.Y. HAY Law § 38 — New York Code / Act HAY / Article 3 / Section 38
Contracts for construction or improvement of highways
Status: in_force

§ 38. Contracts for construction or improvement of highways. State\nhighways shall be constructed or improved by contract. Upon the\ncompletion and final adoption or approval, as provided by law, of the\nplans and specifications for the construction or improvement of a state\nhighway, contracts therefor shall be executed as provided herein.\n  1. Advertising for proposals. The commissioner of transportation shall\nadvertise for proposals for the construction or improvement of such\nhighways or sections thereof according to the plans and specifications\nprepared therefor. The advertisement shall be limited to a brief\ndescription of the work proposed to be done, with an announcement\nstating where the maps, plans and specifications may be seen, the terms\nand conditions under which proposals will be received, the time and\nplace where the same will be opened, the amount of the draft or\ncertified check to accompany the proposal, and such other matters as the\ncommissioner of transportation may deem advisable to include therein.\nSuch advertisement shall be published at least once in each week for two\nsuccessive weeks in a newspaper published in the county in which such\nhighway or section thereof is to be constructed or improved, and in such\nother newspapers as the commissioner of transportation may designate. If\nno newspaper is published in the county, the publication of the\nadvertisement shall be in such newspaper or newspapers in an adjoining\ncounty as may be selected by the commissioner of transportation. Failure\nof such newspaper, published in such county or adjoining county, to\npublish such advertisement as provided in this subdivision or as\ndirected by the commissioner of transportation shall not invalidate the\npublication of advertisement for proposals provided such advertisement\nis published in another newspaper or trade publication, which will be\nmost likely to give adequate notice to contractors of the work\ncontemplated and of the invitation to submit proposals therefor, at\nleast once in each week for any two successive weeks preceding the date\non which proposals described in such advertisement are to be received\nand opened.\n  2. Proposals. Each proposal shall specify the correct gross sum for\nwhich the work will be performed and shall also include the amount to be\ncharged for each item specified on the proposal estimate sheet. The\ncommissioner of transportation may prescribe and furnish forms for the\nsubmission of such proposals and may prescribe the manner of submitting\nthe same which shall not be inconsistent herewith. Accompanying each\nproposal there shall be either a certified check or bank cashier's check\nfor the amount of the bid deposit, to be fixed by the commissioner of\ntransportation and specified in the advertisement for proposals or such\nother security from the bidder as may be acceptable to the commissioner\nof transportation. The checks of the two low bidders shall be deposited\nby the commissioner of transportation in a special account. Provided,\nhowever, that if prior to or upon receipt of said checks by the\ncommissioner of transportation a bidder who is one of the two low\nbidders shall have duly filed a bond as hereinafter provided the\ncommissioner of transportation shall forthwith return to said bidder his\naforesaid check without depositing the same. If alternate proposals are\ntaken, the checks of the two low bidders of all alternate proposals\nshall be deposited. All checks other than those of the two low bidders\nshall be returned promptly by the commissioner of transportation.\nNotwithstanding the provisions of any general or special law, the money\nrepresented by the checks of the two low bidders shall be paid from the\nspecial account when the contractor has duly executed and delivered to\nthe commissioner of transportation the contract and the bond or bonds,\nif any, required by law for the performance of the work of a public\nimprovement for the state of New York, or upon the rejection of all\nbids. The low bidder, in the discretion of the commissioner of\ntransportation, and the second low bidder, as a matter of right, may at\nany time after the opening of the respective proposals, file with the\ncommissioner of transportation a bond, the principal amount of which\nshall at least equal the amount of the respective bidder's check,\ntheretofore deposited with his proposal, in the form prescribed by the\ncommissioner of transportation, with sufficient sureties, to be approved\nby the commissioner of transportation, conditioned that the said bidder\nwill execute a contract and furnish such performance or other bonds as\nmay be required by law in accordance with the terms of the bidder's said\nproposal. If a bidder complies with the aforesaid provision, the\ncommissioner of transportation shall forthwith return the money\nrepresented by the check of such bidder. In case the bidder to whom the\ncontract shall be awarded shall fail to execute such contract and bond\nif required, the moneys represented by such check shall be regarded as\nliquidated damages and shall be forfeited to the state and shall be\ndeposited by the commissioner of transportation with the commissioner of\ntaxation and finance to the credit of the general fund. Provided,\nhowever, that although a performance bond or a payment bond or both may\nbe accepted from a bidder by the commissioner of transportation, a\nrequirement to furnish such bond or bonds may be dispensed with where\nthe aggregate gross sums of the contracts to be awarded for the project\nis under fifty thousand dollars and provided further, that in a case\nwhere a single contract is issued for a project which is not subject to\nthe multiple contract award requirements of section one hundred\nthirty-five of the state finance law, such requirements may be dispensed\nwith where the commissioner finds it to be in the public interest and\nwhere the aggregate amount of the contract awarded or to be awarded is\nless than two hundred fifty thousand dollars. The gross sums indicated\non the proposals when opened shall be publicly read. The commissioner\nshall keep the bids for the several items of the proposals confidential\nuntil an award of the contract is made, after which the proposals shall\nbe subject at all reasonable times to public inspection.\n  2-a. Contracts; rubber-modified asphalt materials. In regard to\ncontracts for construction or improvement of highways incorporating the\nuse of asphalt construction materials after May first, nineteen hundred\neighty-nine, the commissioner may require that the paving materials\nincorporate a percentage of scrap rubber derived from motor vehicle\ntires discarded in the state. Such percentage of rubber additives may be\nestablished by the commissioner subsequent to the completion of a\nrubber-modified asphalt pilot project to be conducted pursuant to\nsection twenty-three of this chapter.\n  3. Award of contracts. The contract for the construction or\nimprovement of such highway or section thereof shall be awarded to the\nlowest responsible bidder, as will best promote the public interest. No\ncontract shall be awarded to a bidder other than the lowest responsible\nbidder without the written approval of the comptroller. The lowest bid\nshall be deemed to be that which specifically states the lowest gross\nsum for which the entire work will be performed, including all the items\nspecified in the estimate thereof. The lowest bid shall be determined by\nthe commissioner of transportation on the basis of the gross sum for\nwhich the entire work will be performed, arrived at by a correct\ncomputation of all the items specified in the estimate therefor at the\nunit prices contained in the bid.\n  4. Rejection of proposals. The commissioner of transportation may\nreject any or all proposals and may advertise for new proposals as\nprovided in this section, if, in his opinion, the best interests of the\nstate will thereby be promoted.\n  5. Form of contract. The commissioner of transportation shall\nprescribe the form of contract and may include therein such matters as\nhe may deem advantageous to the state.\n  6. Bond of contractor. Each contractor, before entering into a\ncontract for such construction or improvement, shall execute a bond in\nthe form prescribed by the commissioner of transportation, with\nsufficient sureties, to be approved by the commissioner of\ntransportation, conditioned that he will perform the work in accordance\nwith the terms of the contract and the plans and specifications, and\nthat he will commence and complete the work within the time prescribed\nin the contract. The bond shall also provide against any direct or\nindirect damages that shall be suffered or claimed on account of such\nconstruction or improvement during the time thereof, and until the\nhighway is accepted.\n  7. Payments on contract, state taxes. The contract shall provide for\npartial payments as the work progresses as hereinafter provided:\n  (c) Whenever a contract shall in the judgment of the commissioner of\ntransportation be substantially completed, the commissioner of\ntransportation may, provided the regional director certifies that the\nessential items in the contract have been completed in accordance with\nthe terms of the contract and the provisions of this chapter, direct the\nregional director to include in the final account such uncompleted items\nand pay therefor at the item prices in the contract upon the contractor\ndepositing with the commissioner of transportation a certified check\ndrawn upon a legally incorporated bank or trust company equal to at\nleast double the value of such uncompleted work or, with the approval of\nthe state comptroller, securities as are listed in subdivision three of\nsection one hundred thirty-nine of the state finance law, equal to at\nleast double the value of such uncompleted work. The deposit may be used\nby the commissioner of transportation to complete the uncompleted\nportion of the contract and shall be returned to the contractor if he\ncompletes the uncompleted portion within a specified number of working\ndays after he has been notified to proceed with the work.\n  (d) No certificates approving or authorizing a partial or final\npayment shall be made by the commissioner of transportation until he is\nsatisfied that all laborers employed on the work have been paid for\ntheir services for the last payroll period preceding the said partial or\nfinal payment. The commissioner of transportation may, if he deems\nnecessary, require an affidavit to such effect from the contractor or he\nmay depend on any other source which he deems proper for such\ninformation.\n  (e) No such certificate approving or authorizing the first partial\npayment or any final payment to a foreign contractor shall be made\nunless such contractor shall furnish satisfactory proof that all taxes\ndue the state tax commission by such contractor, under the provisions of\nor pursuant to a law enacted pursuant to the authority of article nine,\nnine-a, twelve-a, sixteen, sixteen-a, twenty-one, twenty-two,\ntwenty-three, twenty-eight, twenty-nine or thirty of the tax law or\narticle two-E of the general city law have been paid. The certificate of\nthe state tax commission to the effect that all such taxes have been\npaid shall be, for purpose of this paragraph, conclusive proof of the\npayment of such taxes. The term "foreign contractor" as used in this\nsubdivision means, in the case of an individual, a person who is not a\nresident of this state, in the case of a partnership, one having one or\nmore partners not a resident of this state, and in the case of a\ncorporation, one not organized under the laws of this state.\n  (f) Payment of the moneys due under a contract shall be made in\naccordance with the provisions of article eleven-A of the state finance\nlaw, provided failure to make such payment, as heretofore prescribed,\nshall not be due to any fault, neglect, or omission on the part of the\ncontractor or by reason of the filing of any lien, attachment, or other\nlegal process against the money due said contractor.\n  (g) For the purpose of making a final payment on a highway\nconstruction contract, the date to be used for determining the receipt\nof an invoice in subdivision two of section one hundred seventy-nine-f\nof the state finance law shall be the date on which the contract work\nhas been accepted as completed by the commissioner of transportation.\n  8. Contingencies and extra work. Whenever the commissioner of\ntransportation determines that from any unforeseen cause the terms of\nany contract should be altered to provide for contingencies or extra\nwork, he may, if funds are available for payment of the cost thereof,\nissue an order on contract therefor to the contractor, a copy of which\nshall be filed with the director of the budget and the state\ncomptroller. The estimated expenditure pursuant to the order on contract\nshall not increase the total amount of the primary contract until the\nestimated expenditure shall have been approved by the commissioner of\ntransportation and a duplicate of such approval shall have been filed\nwith the comptroller. No such extra work shall be commenced or\nundertaken until the commissioner of transportation has issued an order\non contract as herein provided.\n  When such order on contract provides for similar items of work or\nmaterials which increase or decrease the itemized quantity provided for\nin the primary contract, the price to be paid therefor shall not exceed\nthe unit bid price in the primary contract for such items. Agreed prices\nfor new items of work or materials may be incorporated in the order on\ncontract as the commissioner of transportation may deem them to be just\nand fair and beneficial to the state.\n  Whenever the commissioner of transportation also determines that in\nthe cases herein provided it is impracticable for him to ascertain in\nadvance the just and fair price to be paid by the state for new items of\nwork or materials, the order on contract therefor may provide for\nperformance of the work and the furnishing of the materials and\nequipment, in which event the contractor shall keep and shall make\navailable at all times to the commissioner of transportation such\naccounting records, data and procedure as may be required by the\ncommissioner of transportation. An estimate of the value of such work\nand the furnishing of materials and equipment shall be submitted by the\ncommissioner of transportation to the state comptroller who is hereby\nempowered to approve such estimate. Partial and final payments shall be\nmade upon proper records and data itemized as hereinbefore indicated.\n  Before any final accounting shall become effective, a supplemental\ncontract and final agreement shall first be approved by the comptroller,\nand filed in his office. The director of the budget may at his\ndiscretion require the commissioner of transportation to submit periodic\nsummaries of and reports on the scope and status of highway projects in\nsuch form and at such intervals as he may require, including any and all\ncontract documents.\n  9. Adjustment of disputes. Notwithstanding the provisions of any\ngeneral or special law, and in case of a dispute between a contractor\nand the commissioner of transportation concerning questions of fact\nwhich may arise under a contract, the contractor may, at any time before\nthe final estimate is rendered, petition the commissioner of\ntransportation for a hearing in relation thereto, provided (1) the\namount involved therein as shown by such petition does not exceed five\nthousand dollars or five per centum of the final estimate of the\ncompleted contract, whichever is greater, (2) the contractor has\ncomplied with all provisions of the contract that relate to the filing\nof any protest and also of any statement concerning the subject-matter\nthereof, and (3) the contractor shall expressly agree in such petition\nthat any determination as hereinafter provided, shall be final and\nconclusive upon all parties thereto. If the commissioner of\ntransportation grants such petition, he shall, within a reasonable time,\nmail a notice to the contractor which shall specify the place of such\nhearing and the date thereof which shall be within thirty days after the\nmailing of such notice. Within ten days after such mailing, the\ncommissioner of transportation shall also mail a copy of the petition\nand of such notice of hearing to the attorney general, who together with\nthe commissioner of transportation, shall constitute a board to (a) hear\nsuch dispute, either personally or by any duly authorized officer or\nemployee of their respective departments, and (b) determine the issues\nthereof.\n  Any amount fixed in the determination to be paid to the contractor\nshall be deemed to be a special item to be incorporated in a final\nsupplemental contract and shall be payable from monies available for\nconstruction and reconstruction of state highways, on the audit and\nwarrant of the comptroller on vouchers approved by the commissioner of\ntransportation.\n