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4.28. The definition of “governmental procurement” in State Finance Law §§ 139-j(1)(e) and 139-k(1)(e) exempts certain kinds of contract amendments from these requirements. Can you provide additional guidance regarding this exemption? (Last Updated: 6/14/2010)

SFL §§ 139-j(1)(e) and 139-k(1)(e) provide the definition of “governmental procurement.” In pertinent part, it provides:

“Governmental procurement” shall mean:  ….(v) approval or denial of an assignment, amendment (other than amendments that are authorized and payable under the terms of the procurement contract as it was finally awarded or approved by the comptroller, as applicable)… .

This definition sets forth several requirements that must be met for the exemption to apply. First, the transaction in question must be an amendment to a contract that has received all necessary approvals (i.e., finally awarded or approved). Second, the scope of the amendment must be “authorized and payable” under the terms of the Procurement Contract as awarded or approved. For example, it is not uncommon for a construction Procurement Contract to include language in the terms and conditions that authorizes the parties to make changes by altering, adding to or deleting from the scope of work and adjusting the contract price according to a prescribed method to pay for the altered, added or deleted tasks. All such change orders be executed in conformity with the terms and conditions of the Procurement Contract. The change orders may result from any number of issues, arising in connection with the scope of the original contract, such as previously unknown conditions or a change necessary in order to perform the work.

Such a contract amendment would satisfy the two requirements of the exemption and such an amendment would not trigger a Restricted Period. Similarly, a Procurement Contract for commodities and services might include contractual terms and conditions that authorize the addition of new offerings in a product or service line and establish the means of determining the amount of payment for the new offerings. Such a contract amendment would also satisfy the two requirements of the exemption and the amendment would not trigger a Restricted Period. In contrast, an amendment to a Procurement Contract that seeks to add a new phase to a project that was not contemplated in the final contract would not fall within the exemption.


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