SB 739 ““Anti-Discrimination Against Israel Act, Contracting Officers Beware”

May 29, 2020

by Lisa Berns

The Missouri legislature’s truncated and recently completed 2020 session did not produce as much legislation as is typical. Nonetheless one of the few bills that has made it out of the capitol has some terms that (assuming it is not vetoed by Governor Parson) Missouri public school district and community college district officials should be fully aware of for all new contracts, requests for proposal and purchase orders going forward.

Truly agreed to and finally passed Senate Bill 739 requires all public entities to include in all contracts that involve the acquisition or disposition of services, supplies, information technology or construction a certification from the vendor confirming it is not discriminating against the State of Israel. The certification must state that the vendor is not currently engaged in and for the duration of the contract will not engage in a boycott of good or services from Israel companies or persons doing business in or with Israel.

The Bill’s language is quite specific, and points to keep in mind include the following:

  • The certification should state specifically that “The company is not currently engaged in and shall not, for the duration of the contract, engage in a boycott of goods or services from the State of Israel; companies doing business in or with Israel or authorized by, licensed by, or organized under the laws of the State of Israel; or persons or entities doing business in the State of Israel.”
  • The terms “boycott Israel” and “boycott of the State of Israel” are broadly defined by the statute to include just about any activity to inflict economic harm or otherwise business with Israel or persons or companies doing business in or with Israel with the intent to support a boycott of Israel.
  • The absence of an affirmative statement in support of a boycott of Israel by a particular company is not dispositive if “other factors warrant such a conclusion.”
  • The term “company” is also broadly defined includes both profit and not for profit entities, corporations, associations, partnerships, limited liability companies, and other business associations, including affiliates, parents and subsidiaries.
  • There are exceptions to this requirement for contracts with a total potential value of less than $100,000 and contractors with fewer than 10 employees. Given that contract and contractor sizes can change over the term of a contract (renewals, price increases, corporate expansions, etc.), and given the potential consequence for failing to include this requirement (see below), the conservative approach would be to include this language in all contracts.
  • a failure to include the required language or otherwise to comply with the law’s requirements makes the contract “void against public policy.” There are other Missouri laws that require specific contract language be included in various types of public contracts; however, they do not typically include this particular consequence. It is not difficult to imagine either an unhappy vendor who wants out of a bad deal or an unhappy bidder who lost out on a large project pouncing on the lack of this language as a means to successfully challenge a school district contracting decision.

Lisa J. Berns practices in the areas of real estate, lending and finance and corporate law. She has extensive experience representing public and private clients in a variety of transactional matters, including the purchase, sale and leasing of office, industrial, retail and school properties, and construction of commercial and school properties. She has represented borrowers and lenders in complex financing transactions secured by major St. Louis office and retail properties, as well as transactions involving asset-based and cash flow loans. Her practice also has involved the foreclosure of commercial and consumer properties and workout negotiations. She has represented multiple Fortune 500 clients in the management of their owned and leased properties on a nationwide basis.

Tueth, Keeney, Cooper, Mohan & Jackstadt P.C. assists a variety of public and private clients with their Real Estate law related issues. Our clients include school districts, private parties, subdivision homeowner associations, contractors, developers and corporations. Our attorneys have experience with real estate sales and purchases, title issues, leases, financing, construction and property management.

Tueth Keeney has one of the largest and most successful education law groups in the country. The Firm regularly serves the legal counsel needs of approximately 150 school districts throughout Missouri. The Firm also has one of the largest school law practices in Central and Southern Illinois.

Tueth Keeney maintains one of the largest and most successful higher education law groups in the Midwest. Our higher education practice includes representation of numerous colleges and universities throughout Missouri and Illinois. In addition, the Firm is one of approximately twenty law firms in the nation that have been appointed to act as Select Counsel to represent higher education institutions insured by United Educators Insurance Risk Retention Group, Inc., the nation’s largest insurer of colleges and universities. The attorneys in the Firm’s higher education group provide a full range of services to colleges and universities, ranging from day-to-day counseling on legal issues, to representation in complex litigation.