Court ruling on ‘piggybacking’ might affect village contracts

On Monday, Nov. 2, Patchogue Village held a meeting in Village Hall for the Community Development Agency.

For the monthly financial report, covering Oct.3 to Nov. 2, the CDA wrote 66 checks for a total of $279,317.08, the bulk of which was for housing assistance ($236,000.00).

Office expenses were higher than normal at $30,475.97 with over $14,000 of total going towards new software for the department.

A court decision on bids for municipality contracts made in May 2026 by the New York State Appellate Court might impact future contracts to open, competitive bidding that had previously been granted from one municipality to another.

The project currently being affected, contracted with Town of Brookhaven, was not likely to begin until spring 2027, giving the Village time for further guidance on the ruling.

The Village attorneys have interpreted the ruling conservatively and advise that open bids be held as it remains a “gray issue” without any formal edict.

David Kennedy, Executive Director of the Business Improvement District thanked Teresa Reilly, Deputy Director and HQS Coordinator, for her diligent work and discovery of the ruling prior to even the attorneys.

“As situation like this, I would think there would be more of an official notice…we’ve never received any of this,” said Kennedy.

The ruling in question is in the case of David J. Lynch v. Board of Education of the Maine-Endwell Central School District.

In Dec. 2022, the voters of the Maine-Endwell school district approved a bond referendum to support a multiyear, multiphase capital project involving various buildings and facilities of respondent Maine-Endwell Central School District.

Phase one of the project was the replacement of a sewer line and parking lot at the district’s high school that was completed in the summer of 2023 by respondent Smith Site Development, LLC.

After successful completion, the school district wanted to employ Smith’s HVAC company for the renovations and classroom construction at an elementary school.

With the contract for the second phase delayed after submission to the state Education Department the district decided that, rather than undergoing a competitive public bidding process they would have Smith’s HVAC company portion of phase two by means of cooperative purchasing through an entity called The Interlocal Purchasing System (TIPS).

TIPS is a Texas public agency that describes itself as “a national purchasing cooperative offering competitively solicited contracts to education[,] government and nonprofit agencies.”

TIPS states that its members are “able to save time and money . . . because TIPS completes the competitive bidd[ing] process for [them].” In addition to allowing its public entity members to quickly select a vendor from a preapproved, competitively evaluated list, TIPS acts as a broker by providing its members opportunities to “piggyback” a contract onto a previously awarded contract, utilizing some of the same terms and conditions.

In general Municipal Law in New York state, all contracts for public works worth over $35,000, and all purchase contracts worth over $20,000, are subject to the competitive bidding process and either must be awarded to the lowest responsible bidder.

The municipality may piggyback a contract when making “purchases of apparatus, materials, equipment or supplies, or . . . contract[s] for services related to the installation, maintenance or repair of apparatus, materials, equipment, and supplies.”

Opposing attorneys proffered that this language allows piggybacking only in connection with purchase contracts, not public works construction contracts like the district’s contract with Smith.

They believed the district impermissibly circumvented the competitive bidding while the school district said an alternative to public bidding was allowed in a sub-section of the law.

While the court ceded that legislation in 48 states did allow for municipalities to “cooperative purchasing,” it was ruled that piggybacking being used for public works contracts was not valid. 

“The Legislature contemplated that the piggybacking provision would be used to facilitate procurement in the context of purchase contracts, as opposed to construction and renovation projects like the one at issue,” read the court decision written by justice Andrew G. Ceresia.

“Anything above $35,000 that would have to go to BID, that has changed the standard of that would make go to BID. Usually with county contracts, a lot times the Village avoids BID because they can pull it off the pricing of the county contract,” said Kennedy.