Division Issues Guidance on Prohibitive Activities with Russia-Belarus Law, Update to Iran Investment Certification

The Division of Local Government Services issued Local Finance Notice 2022-24, which provides guidance on implementing the law on prohibiting dealings with Russia or Belarus associated businesses (P.L. 2022, c. 3) and an update on the law requiring vendor and contractor disclosure of investment activities in Iran.

 Highlights of the notice on the Russia-Belarus List include:

• Before any contract greater than $1,000 for goods or services is awarded, renewed, amended, or extended, the contracting unit must require a vendor/contractor to certify that they are not identified on the Treasury’s Russia-Belarus list. In addition, the contracting unit must review the Russia-Belarus list to determine if the vendor/contractor appears on the list.
• If an Ownership Disclosure Statement has been submitted with a bid or proposal, a contracting unit is not required to review the stockholders, partners, or LLC members’ names on the statement against the Russia-Belarus list or the certificate. 
• A contracting unit is not required to reference the Russia-Belarus list or request a certificate from a contractor for construction contracts prior to the awarding of the contract. 
• If Treasury places a construction contractor with a Public Works Contractor Registration on the Russia-Belarus list, that contractor may continue to be awarded construction contracts until the expiration of its Public Works Contractor Registration. 
• A contracting unit does not need to independently confirm the veracity of a vendor’s or contractor’s certification. However, if a contracting unit becomes aware of credible publicly available information indicating a certificate may be false and based on that information determines the certificate is false, they must terminate the contract and report the false certification to the State’s Attorney General. 
• A local contracting unit is prohibited to bank with, have or hold stock, debt, or other equity investments of, or maintain insurance coverage through a policy issued by a financial institution that appears on the Russia-Belarus list. This includes banks that are GUDPA, Governmental Unit Deposit Protection Act,-approved depositories. 
• A person or entity appearing on the Russia-Belarus list cannot be designated as a redeveloper, enter into a PILOT agreement, or otherwise be awarded a municipal property tax abatement. The application process must include a similar certification as with procurement and the local unit must confirm that the applicant does not appear on the Russia-Belarus list.  

In regard to the disclosure of investments in Iran: if a person or entity is listed by the State’s Treasury as engaging in investment activities in Iran, a local contracting unit cannot award or renew a contract for goods or services with that person or entity. That list, commonly referred to as a Chapter 25 list, is updated by Treasury every 180 days.  Before any contract greater than $1,000 for goods or services is awarded, renewed, amended, or extended, the contracting unit must require a vendor/contractor to certify that they are not identified on the Treasury’s Chapter 25 list. In addition, the contracting unit must review the Chapter 25 list to determine if the vendor/contractor appears on the list. The certification is required to be provided prior to the contract award or contract renewal, rather than with the bid or proposal. Please note that, unlike the Russia-Belarus law, the Iran Disclosure Law does not address redevelopment or PILOT agreements. 

The Division has also prepared a model certification that combines the Russia-Belarus and Iran disclosures onto a single form for procurement purposes.

 Contact: Lori Buckelew, Deputy Executive Director & Director of Government Affairs, lbuckelew@njlm.org,  609-695-3481, x120.