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Bill

S 5014

Prohibits State agency from entering into certain State contracts that limits ability of State agency to install or run certain software.

2024-2025 Regular Session Introduced by Nilsa Cruz-Perez and 2 co-sponsors

Prohibits NJ state software contracts from locking in hardware; agencies may run licensed software on their chosen hardware, boosting autonomy and interoperability.

Transferred to Senate Budget and Appropriations Committee
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Bill Summary · S 5014

Summary of S.5014 (New Jersey)

Overview

  • Bill Number: S.5014
  • Official Title: An act concerning the terms of State contracts and supplementing P.L.1954, c.48 (C.52:34-6 et seq.).
  • Purpose: Prohibits State agencies from entering into software licensing contracts that restrict the agency’s ability to install or run the licensed software on the hardware of the agency’s choosing (generally available desktop or server hardware).
  • Current Status: Transferred to the Senate Budget and Appropriations Committee. Introduced in the 221st Legislature (S5014). Introduced December 18, 2025; later actions show transfer on January 6, 2026. Previously referred to Environmental Conservation and other committees during early stages of consideration.
  • Sponsors: Primary sponsor Luis R. Sepúlveda; multiple cosponsors including José M. Serrano, Monica Martinez, Rachel May, Lea Webb, Leroy Comrie, Jabari Brisport, Pete Harckham, and Joseph P. Addabbo Jr.

Key Provisions

  • Definitions (Section 1a):

    • “State agency” includes principal executive departments, subdivisions, independent authorities/instrumentalities subject to public contracting, and other entities within or created by those departments.
    • “State contract” means any contract or agreement entered into by a State agency for which costs are paid with State funds.

  • Prohibition on Software Licensing Contracts (Section 1b):

    • If a State agency enters into a State contract for licensing software designed to run on generally available desktop or server hardware, the contract must not restrict the agency’s ability to install or run the software on hardware of the State agency’s choosing.

  • Effective Date (Section 2): The act takes effect immediately upon enactment.

What This Bill Does

  • Ensures State agencies retain control over hardware choices when licensing software. The core restriction prevents software licensing terms from imposing hardware lock-in or requirements that limit the agency’s ability to deploy the software on its own hardware configurations.

Who or What Is Affected

  • Affected Parties: State agencies and their contractors vendors providing software licenses for software intended to run on standard desktop/server hardware within the executive branch and related State entities governed by public contracting rules.
  • Impact on Vendors: Software license terms must be compatible with State-owned hardware decisions; terms that tie the software exclusively to specific hardware or configurations would be disallowed for covered contracts.

Procedural and Timeline Aspects

  • Legislative Path:
    • Referred to Environmental Conservation at early stage (per committee actions listed) before broader committee consideration.
    • Advanced through typical Senate process (second reading, third reading) with multiple committee referrals and terms of passage.
    • Reported/Action items show a transfer to the Senate Budget and Appropriations Committee (January 6, 2026), indicating a shift to potential fiscal review and budgetary considerations.
    • Related bills and companion measures exist in prior sessions (e.g., S 4686, S 1883, A 1616, etc.), indicating ongoing interest in similar contract defaults.

Potential Impacts

  • Operational Flexibility: Agencies gain flexibility to run licensed software on their preferred hardware, potentially improving integration with existing systems and cost controls.
  • Procurement Standards: Sets a policy baseline that software contracts should not stifle agency technical autonomy.
  • Budget and Compliance Review: The transfer to the Budget and Appropriations Committee suggests close scrutiny of fiscal implications and contract terms.

Additional Context

  • The bill supplements existing public contracting laws (P.L.1954, c.48) and aligns with procurement practices emphasizing technological independence and interoperability within State operations.

Compiled from official sources — confirm details with the bill’s official record.

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