Prohibits disqualification of certain minority-owned and women-owned businesses for certification.

A1709

ASSEMBLY, No. 1709

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblywoman VERLINA REYNOLDS-JACKSON

District 15 (Hunterdon and Mercer)

SYNOPSIS

���� Prohibits disqualification of certain minority-owned
and women-owned businesses for certification.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning certification of minority-owned and
women-owned businesses and amending P.L.1987, c.55.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� Section 5 of P.L.1987,
c.55 (C.52:27H-21.11) is amended to read as follows:

���� 5.��� The division shall have
the power to:

���� a.���� Establish a loan
referral program and loan packaging program for eligible businesses, using
criteria for eligibility which meet the standards established by the authority
or which meet the standards established by private sources or by other State or
federal programs;

���� b.��� Compile lists of
qualified professionals, including women and minorities in specific areas of
expertise, to be disseminated to eligible businesses and to be used in making
referrals;

���� c.���� Use available resources
within the State, including, but not limited to, small business development
centers, business organizations, academic institutions with business programs,
and minority business development offices, to coordinate managerial and technical
assistance;

���� d.��� Establish, in
cooperation with institutions of higher education, an internship program for
candidates for undergraduate and graduate degrees in business administration
and related fields for the purpose of providing assistance to the division, the
authority and to businesses which are eligible to receive assistance under this
act;

���� e.���� Provide, consistent
with the provisions of this act and in conjunction with, or at the request of,
the authority, assistance to eligible businesses, including, but not limited
to:

���� (1)�� Assistance in
researching markets or in market analysis;

���� (2)�� Advice in advertising
and marketing;

���� (3)�� Advice in selecting
sales or other distribution channels;

���� (4)�� Providing information
and training with respect to bidding on government contracts;

���� (5)�� Serving as liaison with
the Department of the Treasury and other departments and agencies of State,
federal and local government to promote the procurement of contracts for
eligible businesses;

���� (6)�� Assistance in obtaining
legal counsel;

���� (7)�� Providing financial
analysis and accounting assistance;

���� (8)�� Assistance in obtaining
appropriate insurance, including benefit packages for employees;

���� (9)�� Assistance in arranging
contracts with franchisers;

���� (10)��� Assistance in
arranging commercial loans made by a State or federally chartered bank, savings
bank, or savings and loan association, if, with respect to loans made by State
chartered institutions, the loans are made in accordance with the powers
conferred on those institutions pursuant to Title 17 of the Revised Statutes,
including bridge loans and cash flow loans;

���� (11)��� Assistance in
negotiating license agreements;

���� (12)��� Assistance in
procuring bonding or substitutes therefor;

���� (13)��� Making referrals to
private consultants, institutions, and other providers of services, according
to the specific needs of an eligible business;

���� (14)��� Assistance in finding
sources of financing from federal, State, and local sources;

���� (15)��� Assistance in gaining
information about employee training and development programs; and

���� f.���� Provide a central
resource for eligible businesses in their dealing with federal, State, and
local governments, including information regarding government regulations or
laws which affect eligible businesses;

���� g.��� Initiate and encourage
education programs for eligible businesses;

���� h.��� Notwithstanding any
other provision of law, exercise exclusive authority within the State to
establish a uniform procedure for departments, agencies and authorities of the
State and of its political subdivisions to certify the eligibility of a
business to bid on contracts, or otherwise represent itself as a minority or
women's business
, except that a minority or women�s business engaged in the
procurement of materials and supplies that is otherwise eligible for such
certification pursuant to this subsection shall not be rendered ineligible
therefor solely because the business is not significantly and substantially
involved in the production, or does not have evidence of movement, of inventory
on hand, in and out of its facility, provided the business:

����
(1)�� places an order for a
product with a distributor or manufacturer;

����
(2)�� takes possession of
the materials or supplies in the order by payment;

����
(3)�� assumes the risk of
ownership of the materials or supplies; and

����
(4)�� causes the product,
materials, or supplies to be shipped to a customer
.

�����
The uniform
procedure shall provide guidance for determining whether any or all beneficial
owners of the business directly or indirectly created or used a trust, proxy,
power of attorney, pooling arrangement, or any other contract, arrangement, or
device with the purpose or effect of evading the ownership requirements under
section 2 of P.L.1987, c.55 (C.52:27H-21.8).

���� The division shall be the
certifying authority for departments, agencies and authorities of the State,
except that when the division's procedure for certification of a business as a
minority business or women's business conflicts with a federal certification
procedure that affects a State project in which the federal government
participates, the federal certification procedure shall take precedence.�
Public agencies shall identify those projects and shall notify the division.� A
political subdivision shall have the responsibility of certifying the
eligibility of a women's business or minority business to bid on contracts or
otherwise represent itself as a women's business or minority business within
the political subdivision, except that, if the business is certified by the
division to represent itself as being a minority or women's business under
State programs, the political subdivision may accept that certification for
eligibility of the business under programs of the political subdivision.� A
political subdivision shall utilize the uniform certification procedure
formulated by the division;

���� i.���� Submit to the Governor
and the Legislature an annual report regarding its activities and setting forth
recommendations of methods which might be utilized to more efficiently and
effectively carry out the purposes of this act, and submit to the commissioner
periodic reports on the condition of small businesses, and women's and minority
businesses in the State; and

���� j.���� Provide any other
services which it deems necessary or which may be requested by the authority.

(cf: P.L.2003, c.189, s.1)

���� 2.��� This act shall take
effect immediately.

STATEMENT

����� This bill would modify the eligibility criteria for a
business to qualify as a minority-owned or women-owned business under State
law. �The bill specifies that an otherwise eligible minority-owned or
women-owned business engaged in the procurement of materials and supplies would
be eligible for certification although the business is not involved in the
production or movement of inventory on hand, as long as the business:

����� (1)� places an order for a product with a distributor
or manufacturer;

����� (2)� takes possession of the materials or supplies in
the order by payment;

����� (3)� assumes the risk of ownership of the materials
or supplies; and

����� (4)� causes the product, materials, or supplies to be
shipped to a customer.

����� The bill also
requires the uniform procedure,
which governs the certification of minority and women�s businesses, to provide
guidance for determining whether the beneficial owners of a business have
created a shell company or other arrangement with the purpose or effect of
evading the ownership requirements under the law.