New Pay-to-Play Rules Take Effect on November 15, 2008: Is Your Company Ready to Comply?

In less than two days, New Jersey's state pay-to-play laws will change again. Effective November 15, 2008, persons and entities doing business with the State of New Jersey will be subject to Governor Corzine's Executive Orders 117 and 118. We previously discussed these changes here. And here, for the New Jersey Business and Industry Association (NJBIA).

Now covered . . . officers, shareholders, partners, LLC members, and their spouses, resident children, and civil union partners. Indeed, new forms issued by Treasury indicate that each of these individuals may be required to submit a separate certification form prior to contract award. Just imagine: each time your company seeks to enter into a new State contract, you may need to obtain a new signed certification of compliance from a shareholder's resident children or an officer's civil union partner.

Because Executive Orders 117 and 118 broaden the scope of individuals and entities subject to state pay-to-play restrictions, now is the time to adopt or update your Company's Political Activity/Pay-to-Play Policy. One of the keys to an effective policy is making sure that all individuals covered by these new pay-to-play restrictions are aware that their political contributions may have a serious impact on the company's eligibility for a state government contract or a state redevelopment project. In this economy, a company simply cannot afford to have someone else's $300.01 political contribution preclude its contracting opportunities for years to come.