N.Y. Comp. Codes R. & Regs. tit. 21 § 9605.5

Current through Register Vol. 46, No. 45, November 2, 2024

Section 9605.5 - Eligibility

(a) A contractor or subcontractor shall be certified as an LBE upon a determination by the authority that it has met the eligibility requirements set forth in this Part. The initial certification shall be effective for three years and shall expire at the end of such period.

(b) A business which has been in existence for less than one year prior to the date of application for certification and which would otherwise qualify as an LBE except that it does not meet the criteria set forth in section 9605.3(p)(2) of this Part may nevertheless be certified as an LBE provided that such certification shall expire one year after it is granted.

(c) An LBE seeking continuance of certification granted according to subdivision (b) of this section will be notified by the authority two months prior to its certification expiration to submit documents within 30 days after the date of the notification. If, after the one year certification period, the business meets all the criteria for LBE eligibility as set forth in section 9605.3(p) of this Part, certification shall be granted for two more years. This business may apply to have certification renewed after this two-year period as set forth in subdivision (d) of this section.

(d) An LBE whose certification is expiring will be notified by the authority prior to such expiration. An LBE seeking to have its certification renewed for another three-year period, shall submit certification documents within 30 days of the notification of its pending certification expiration.

(e) An applicant which has previously been certified as an LBE and which now meets the criteria for GLBE as set forth in section 9605.3(m) of this Part, shall be certified as a GLBE for an additional two years. Thereafter, it must meet the criteria for LBE eligibility as set forth in section 9605.3(p) of this Part, in order to be recertified as an LBE for an additional three years in accordance with the provisions set forth in subdivision (a) of this section.

(f) Failure to submit recertification documents within 30 days of the recertification notice as set forth in subdivision (c) or (d) of this section shall result in the expiration of LBE certification on the anniversary date.

(g) If an LBE or GLBE submits certification documents timely, as set forth in subdivision (c) or (d) of this section, and the authority is unable to make a determination before the anniversary date, the certification will continue until the authority makes a determination as to the LBE's or GLBE's status.

(h) It is the intent of this Part to qualify businesses as LBEs or GLBEs only if the ownership, management and operations of the business are conducted by persons who do not own, manage or operate other construction businesses which would otherwise be ineligible and who are not currently employed or were not employed by the ineligible company for at least six consecutive months within the year preceding the application for LBE or GLBE certification. Any business applying for LBE or GLBE certification that does not conform to this intent shall be deemed ineligible as a LBE or GLBE.

(i) A LBE or GLBE must be an independent business. A business that is a separate entity for tax or corporate purposes shall not necessarily be deemed to be an independent business. In determining whether a business is an independent business, the authority shall consider all relevant factors including but not limited to:

(1) the date the business was established;

(2) the identity of the principals;

(3) the sources of financing; and

(4) the major shareholders (if any) of the business.

A principal or shareholder in a business seeking certification as an LBE or GLBE cannot be a principal or shareholder in another construction firm where added together the two construction firms have gross receipts in excess of the limits set forth in section 9605.3(m) or (p) of this Part.

(j) The owner of an LBE or GLBE must have management and operational control. The business must not be subject to any extraordinary formal or informal restrictions which limit the discretion of the owner(s).

(k) The following types of ownership, control or circumstances concerning a business seeking certification as an LBE or GLBE shall render it ineligible for participation in the program:

(1) ownership of the business by a non-LBE construction business;

(2) whole or partial ownership of the business by a person who is an owner in whole or in part of another construction business when the sum of the gross receipts of these businesses exceeds the limits as provided for in section 9605.3(m) or (p) of this Part;

(3) whole or partial ownership of a business by a person who is an owner in whole or in part of another construction business not eligible for the program;

(4) control of the business by another construction business through substantial funding arrangements or the sharing of employees, office space or equipment without formal agreement; or

(5) organization or a firm whose officers, directors, principal stockholders, or employees serve as the officers, directors, principal stockholders or employees of another construction business and one concern is furnishing, or will furnish the other concern with subcontracts, financial or technical assistance, and/or other facilities for a fee or otherwise.

(l) A firm seeking LBE or GLBE certification or recertification may be audited by the authority as a prerequisite to certification. Such audit shall include, but not be limited to, a review of the following information: stock certificates; minutes of first meeting; by laws; stock transfer ledger; corporate seal or business certificate; the most recent 90 days of canceled checks; documentation of loans taken out to establish the business; copies of deposit slips verifying bank transactions; payroll records for previous four weeks leases for office or yard space; and documentation of purchase and/or leasing of equipment and vehicles. Failure to submit information in connection with audits may result in ineligibility. If a firm is declared ineligible due to this failure, it will have 10 business days to submit the requested information. At the expiration of the 10 business days, if the information has not been provided, the firm may not reapply to the authority for certification or recertification until six months after the date of that determination.

(m) If, after submitting certification/recertification documents, a business is found not to meet the requirements for LBE or GLBE certification as set forth in this Part, it may submit other certification documents for certification six months after the date it was declared ineligible.

(n) A LBE or GLBE shall notify the authority within 10 days after any change in its ownership or control. Failure to comply with this requirement may lead to decertification.

(o) A LBE or GLBE shall notify the authority of any changes to its address or telephone number within 10 business days of such change. Failure to comply with this requirement may cause its decertification.

N.Y. Comp. Codes R. & Regs. Tit. 21 § 9605.5