SGC-29-15-00014-P Minority- and Women-Owned Business and Workforce Diversity Plan Requirements for Gaming Facility Licensees

7/22/15 N.Y. St. Reg. SGC-29-15-00014-P

NEW YORK STATE REGISTER

VOLUME XXXVII, ISSUE 29

July 22, 2015

RULE MAKING ACTIVITIES

NEW YORK STATE GAMING COMMISSION

PROPOSED RULE MAKING

NO HEARING(S) SCHEDULED

 

I.D No. SGC-29-15-00014-P

Minority- and Women-Owned Business and Workforce Diversity Plan Requirements for Gaming Facility Licensees

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:

Proposed Action:

Addition of Parts 5311-5312 to Title 9 NYCRR.

Statutory authority:

Racing, Pari-Mutuel Wagering and Breeding Law, sections 104(19), 1307(1), 1316(10), 1320(3)(d) and (f)

Subject:

Minority- and women-owned business and workforce diversity plan requirements for gaming facility licensees.

Purpose:

To ensure gaming facility licensees construct and operate their projects in a manner that assures diversity of opportunity.

Substance of proposed rule (Full text is posted at the following State website:www.gaming.ny.gov/):

This addition of Parts 5311-5312 of Subtitle T of Title 9 NYCRR will add new Sections 5311.1 through 5311.8 and 5312.1 through 5312.5 to allow the New York State Gaming Commission (“Commission”) to prescribe rules that require each gaming facility licensee to establish, implement and comply with a utilization plan for minority- and women-owned business enterprises in the construction and operation of its gaming facility and a workforce diversity plan for ensuring a diverse workplace, equal employment opportunity and employee advancement. The proposed rules mandate a procedure for the Commission to review and approve such plans in consultation with New York State Empire State Development Corporation (ESD).

Section 5311.1 sets forth the purpose and scope of the rule which is to ensure that gaming facility licensees construct their gaming facility and conduct all aspects of their operations in a manner that assures diversity of opportunity. Section 5311.2 sets forth the definitions used throughout Part 5311. Section 5311.3 describes the utilization plan that gaming facility licensees must submit to the Commission for approval and annual review. In the utilization plan, the gaming facility licensee sets forth specific goals for each type of contracted work and specific minority– and women-owned business enterprises that the licensee intends to contract or subcontract with to meet the goals. Section 5311.4 requires the inclusion of specific language in procurement solicitations and contracts for gaming facility capital projects that promote and encourage maximum feasible MWBE participation. All such procurement contracts must be submitted to the commission and approved by the division of minority and women’s business development in the department of economic development in advance of execution. In addition, it requires gaming facility licensees to submit monthly or quarterly reports to the Commission regarding implementation of its utilization plan. Section 5311.5 describes the good-faith effort documentation a gaming facility licensee must submit to the Commission when it cannot attain a goal established in the utilization plan. Section 5311.6 describes the additional MWBE documentation the Commission may require when it finds that a gaming facility licensee’s good-faith effort documentation is deficient. If a gaming facility licensee cannot rectify a deficient utilization plan, it may request a waiver of MWBE compliance under Section 5311.7. The Commission and ESD will review a gaming facility licensee’s waiver request, deficient utilization plan and good-faith effort documentation to determine whether the waiver should be granted. Section 5311.7 describes the penalty the Commission may impose when it determines that the gaming facility licensee has failed to satisfy MWBE goals outlined in the utilization plan, failed to make a good-faith effort to achieve the goals or failed to prepare and file accurate and timely utilization plan reports.

Section 5312.1 sets forth the policy behind the rule which is to ensure that each gaming facility licensee maintains a diverse workplace and provides an opportunity of employment for all residents. Section 5312.2 describes the workforce diversity plan that a gaming facility licensee must submit to the Commission for annual review and approval. Section 5312.3 details a gaming facility licensee’s annual self-assessment review and additional reporting requirements. Section 5312.4 describes how the Commission will determine whether a gaming facility licensee is compliant with the goals outlined in the workforce diversity plan. Section 5312.5 describes the sanctions the Commission may impose upon a gaming facility licensee when it determines that the licensee failed to satisfy its workforce diversity plan, failed to make a good-faith effort to achieve the goals in the plan, failed to improve its efforts or where the licensee failed to prepare and file accurate and timely reports.

Text of proposed rule and any required statements and analyses may be obtained from:

Heather McArn, New York State Gaming Commission, One Broadway Center, 6th Floor, Schenectady, NY 12305, [phone], email: [e-mail]

Data, views or arguments may be submitted to:

Same as above.

Public comment will be received until:

45 days after publication of this notice.

Regulatory Impact Statement

1. STATUTORY AUTHORITY: Racing, Pari-Mutuel Wagering and Breeding Law (“Racing Law”) section 104(19) grants authority to the Gaming Commission (“Commission”) to promulgate rules and regulations that it deems necessary to carry out its responsibilities. Racing Law section 1307(1) authorizes the Commission to adopt regulations that it deems necessary to protect the public interest in carrying out the provisions of Racing Law Article 13.

Racing Law section 1316(10) prescribes that gaming facility license applicants formulate and abide by an affirmative action program of equal opportunity with specific goals for the utilization of minorities, women and veterans on construction jobs.

Racing Law section 1320(3)(d) and (f) prescribe that gaming facility license applicants be considered for licensure based, in part, on proposed workforce enhancement factors for the gaming facility including plans to establish, fund and maintain human resource hiring and training practices that promote the development of a skilled and diverse workforce, plans to provide access to promotion opportunities through a workforce training program, and plans to implement a workforce development plan that includes, among other things, specific goals for the utilization of minorities, women and veterans on construction jobs.

2. LEGISLATIVE OBJECTIVES: This rule making carries out the legislative objectives of the above-referenced statutes.

3. NEEDS AND BENEFITS: The proposed rules establish obligations for gaming facility licensees to construct and operate their projects in a manner that assures diversity of opportunity. The proposed rules set forth a procedure by which the Commission, in consultation with New York State Empire State Development Corporation (ESD), will review and approve a gaming facility licensee’s MWBE goals and utilization and workforce diversity plans, waivers from any such goals and plans, and hold gaming facility licensees and their contractors accountable to the purposes of the program.

Section 5311.1 sets forth the purpose and scope of the Part referencing applicable statutory and regulatory provisions where appropriate.

Section 5311.2 sets forth the definitions used throughout Part 5311.

Section 5311.3 sets forth the utilization plan that a gaming facility licensee must submit for approval and annual review.

Section 5311.4 establishes approvals for gaming facility capital project contracts and procurements and other quarterly reporting requirements.

Section 5311.5 sets forth the good-faith effort documentation a gaming facility licensee must submit when it cannot attain a goal established in the utilization plan.

Section 5311.6 establishes the additional MWBE documentation that may be required when it a gaming facility licensee’s good-faith effort documentation is deficient.

Section 5311.7 sets forth the requirements for a waiver of compliance request when a gaming facility licensee submits deficient MWBE documentation.

Section 5311.8 sets forth the penalty that may be imposed when a gaming facility licensee has failed to satisfy MWBE goals.

Section 5312.1 sets forth the policy and purpose of the Part.

Section 5312.2 sets forth the requirements of the workforce diversity plan that a gaming facility licensee must submit for annual review and approval.

Section 5312.3 sets forth the workforce diversity plan annual self-assessment review and additional reporting requirements.

Section 5312.4 establishes monitoring requirements for the workforce diversity plan.

Section 5312.5 sets forth the penalty imposed upon a gaming facility licensee when it is determined that the licensee failed to satisfy its workforce diversity plan goals.

4. COSTS:

(a) Costs to the regulated parties for the implementation of and continuing compliance with the rule: Gaming facility licensees who fail to make a good-faith effort to attain established minority– and women-owned business enterprise goals will be subject to a fine not to exceed the value of the opportunity lost by the minority– and women-owned business by the Commission. Gaming facility licensees who fail to achieve workforce diversity plan goals may be subject to a penalty as set forth in Racing, Wagering Pari-Mutuel and Breeding Law section 116 and Article 13 by the Commission.

(b) Costs to the regulating agency, the State, and local governments for the implementation of and continued administration of the rule: The rules will impose costs on the Commission and ESD associated with reviewing and approving a gaming facility licensee’s MWBE and workforce diversity goals, plans and results.

(c) The information, including the source or sources of such information, and methodology upon which the cost analysis is based: The cost estimates are based on the Commission’s experience regulating racing and gaming activities within the State.

5. LOCAL GOVERNMENT MANDATES: There are no local government mandates associated with these rules.

6. PAPERWORK: These rules impose paperwork burdens on gaming facility licensees to establish and submit annually a utilization plan listing each minority– and women-owned business enterprise that the licensee intends to use in the performance and operation of the gaming facility. Additionally, gaming facility licensees must establish and submit annually a workforce diversity plan that details a licensee’s commitment to ensuring a diverse workplace.

7. DUPLICATION: These rules do not duplicate, overlap or conflict with any existing State or federal requirements.

8. ALTERNATIVES: The Commission is required to create these rules under Racing Law section 1307(1)(a). Therefore, no alternatives were considered.

9. FEDERAL STANDARDS: There are no federal standards applicable to the licensing of gaming facilities in New York; it is purely a matter of New York State law.

10. COMPLIANCE SCHEDULE: The Commission anticipates that the affected parties will be able to achieve compliance with these rules upon adoption.

Regulatory Flexibility Analysis

These rules are intended to promote and encourage participation by minority– and women-owned business enterprises in the construction and operation of gaming facilities as well as in gaming facility contracting opportunities throughout New York State. These rules are also intended to ensure that gaming facilities maintain a diverse workplace and provide employment opportunities. These rules do not impose any adverse economic impact, reporting, record-keeping or other compliance requirements on small businesses or local governments. To the contrary, these rules will increase the number of minority- and women-owned businesses, including small businesses, able to access gaming facility contracting opportunities throughout New York State. Accordingly, a regulatory flexibility analysis for small businesses and local governments is not required and one has not been prepared.

Rural Area Flexibility Analysis

Several of the development zone regions authorized to host a licensed gaming facility, as contemplated by Racing, Pari-Mutuel Wagering and Breeding Law section 1310, are located within “rural areas” as that term is defined in Executive Law section 481(7). The decision to locate a licensed gaming facility in a rural area will not have an adverse economic impact. These rules have the potential to boost economic development within rural areas. Accordingly, a rural flexibility analysis is not required and one has not been prepared.

Job Impact Statement

1. NATURE OF IMPACT: The Commission has determined that these rules will not have a substantial adverse impact on jobs and employment opportunities. To the contrary, these rules are intended to promote and encourage participation by minority– and women-owned business enterprises in the construction and operation of the gaming facility as well as in gaming facility contracting opportunities throughout New York State. These rules are also intended to ensure that gaming facilities maintain a diverse workplace and provide employment opportunities.

2. CATEGORIES AND NUMBERS AFFECTED: It is anticipated that up to 4 gaming facilities, as contemplated by Racing, Pari-Mutuel Wagering and Breeding Law Article 13, would employ more than 4,000 people. In addition, the construction of the gaming facilities will generate many additional new jobs. It is anticipated that employment in surrounding communities will also increase in order to service the influx of gaming facility patrons.

3. REGIONS OF ADVERSE IMPACT: The Commission does not anticipate regions of the State to suffer a disproportionate adverse impact in regard to jobs or employment opportunities.

4. MINMIZING ADVERSE IMPACT: These rules do not create any unnecessary adverse impact on existing jobs. A positive impact on jobs and employment is anticipated.