Replaces previously released version in its entirety

4.23. State Finance Law §§139-j and 139-k apply to all procurements with an estimated annualized expenditure in excess of $15,000.  What is meant by these terms? (Last Updated: 4/20/2006)

A:  The definition of Procurement Contract contained in State Finance Law §139-j(1)(g) and State Finance Law §139-k(1)(g) imposes these additional requirements on transactions where estimated annualized expenditure will exceed $15,000.  While this phrase is undefined, the rules of statutory construction state that legislative intent should be generally construed according to its natural and most obvious sense.  See McKinney’s Statutes §94.  The word “estimated” refers to a process undertaken by a Governmental Entity to determine the approximate cost of an acquisition.  The word “annualized” refers to the calculation or adjustment based on a twelve-month period.  Thus, in this context, the Governmental Entity is required to determine how much would be expended for a particular acquisition over a twelve-month period.  If a Governmental Entity elects for administrative convenience or other reasons to use a term of less than twelve months for a contract, then its obligation is to estimate how much will be expended over a twelve-month period to determine whether the new State Finance Law requirements apply.

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