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NYS Comptroller


The Academy for New York State's Local Officials

Protecting the Public’s Interest: A Tutorial on Local Government Ethics and Transparency in New York State

Module 1 - Conflict of Interest of Municipal Officers and Employees

Text for Video - What Is a Contract?

As I indicated in the earlier segment, the first question you have to ask yourself is whether or not there is a contract with the municipality. The definition of contract can be found in Section 800(2) of the General Municipal Law and is defined as either an express or implied claim, account, or demand against, or an agreement with, the municipality. Almost every business relationship is going to result in a contract with the municipality. For example, whether you enter into a lease agreement, a purchase agreement, a sales agreement, or even a voucher, these are all within contracts with the municipality because they are either an agreement or claim with the municipality.

Another question I get sometimes is what about an oral contract? Is that a contract for purposes of Article 18? The answer is, yes. While we typically see contracts in writing, an oral contract can be a contract for the purposes of Article 18. Also the designation of the depository of public funds and the designation of an official newspaper or newspaper for publication of official notices is also a contract for purposes of Article18.

We at the Comptroller’s office have concluded there are a number of areas that are not contracts for purposes of Article18. One of these is dealing with various land use matters. Examples of these may be a building permit, a license, a zoning change, or a variance. Also, we at the Comptroller’s office have concluded that intermunicipal agreements are not contracts for purposes of Article 18.

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