BILL NUMBER: AB 138 CHAPTERED 09/11/02 CHAPTER 455 FILED WITH SECRETARY OF STATE SEPTEMBER 11, 2002 APPROVED BY GOVERNOR SEPTEMBER 11, 2002 PASSED THE ASSEMBLY AUGUST 25, 2002 PASSED THE SENATE AUGUST 22, 2002 AMENDED IN SENATE AUGUST 6, 2002 AMENDED IN ASSEMBLY MARCH 27, 2001 INTRODUCED BY Assembly Member Nation JANUARY 24, 2001 An act to amend Sections 10126, 10780.5, and 20103.8 of the Public Contract Code, relating to public contracts. LEGISLATIVE COUNSEL'S DIGEST AB 138, Nation. Bidding procedures: alternative bids. Existing law affecting state contracts prescribes procedures for determining the lowest bidder if additions or deletions from the base bid are considered, authorizes local agencies and the Trustees of the California State University to include alternatives that may be added to, or deleted from, the final bid award for a project, and specifies how those alternatives shall be considered in determining who is the lowest responsible bidder. Existing law requires the lowest bid to be determined in a manner that prevents any information that would identify any of the bidders from being revealed to the public entity before the ranking of all bidders from lowest to highest has been determined. This bill would also require the determination of the lowest bid to be made in a manner that prevents any information that would identify any of the proposed subcontractors or suppliers from being revealed to the public entity before the ranking of all bidders from lowest to highest has been determined. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 10126 of the Public Contract Code is amended to read: 10126. Notwithstanding the provisions of Section 10125, the estimate of cost may be approved by the director, which includes alternates contemplating additions to, or deletions from, the base bid, provided that all of the following requirements are met: (a) Estimates are made for each contingency and, in the aggregate, the alternates do not exceed 10 percent of the estimated cost for the project. (b) The available funds are at least sufficient to cover the filed estimate for the base project. (c) Whenever additive or deductive items are included in a bid, the bid solicitation shall specify which one of the following methods will be used to determine the lowest bid. In the absence of such a specification, only the method provided by paragraph (1) will be used: (1) The lowest bid shall be the lowest bid price on the base contract without consideration of the prices on the additive or deductive items. (2) The lowest bid shall be the lowest total of the bid prices on the base contract and those additive or deductive items that were specifically identified in the bid solicitation as being used for the purpose of determining the lowest bid price. (3) The lowest bid shall be the lowest total of the bid prices on the base contract and those additive or deductive items that, when taken in order from a specifically identified list of those items in the solicitation, and added to, or subtracted from, the base contract, are less than, or equal to, a funding amount publicly disclosed by the department before the first bid is opened. (4) The lowest bid shall be determined in a manner that prevents any information that would identify any of the bidders or proposed subcontractors or suppliers from being revealed to the public entity before the ranking of all bidders from lowest to highest has been determined. (d) The contract is awarded to the lowest bidder, as determined by the method prescribed in subdivision (c). (e) A responsible bidder who submitted the lowest bid as determined by this section shall be awarded the contract, if it is awarded. This section does not preclude the department from adding to or deducting from the contract any of the additive or deductive items after the lowest responsible bidder has been determined. (f) Nothing in this section shall preclude the prequalification of subcontractors. SEC. 2. Section 10780.5 of the Public Contract Code is amended to read: 10780.5. The trustees may require a bid for a public works contract to include prices for items that may be added to, or deducted from, the scope of work in the contract for which the bid is being submitted. Whenever additive or deductive items are included in a bid, the bid solicitation shall specify which one of the following methods will be used to determine the lowest bid. In the absence of such a specification, only the method provided by subdivision (a) will be used: (a) The lowest bid shall be the lowest bid price on the base contract without consideration of the prices on the additive or deductive items. (b) The lowest bid shall be the lowest total of the bid prices on the base contract and those additive or deductive items that were specifically identified in the bid solicitation as being used for the purpose of determining the lowest bid price. (c) The lowest bid shall be the lowest total of the bid prices on the base contract and those additive or deductive items that, when taken in order from a specifically identified list of those items in the solicitation, and added to, or subtracted from, the base contract, are less than, or equal to, a funding amount publicly disclosed by the trustees before the first bid is opened. (d) The lowest bid shall be determined in a manner that prevents any information that would identify any of the bidders or proposed subcontractors or suppliers from being revealed to the public entity before the ranking of all bidders from lowest to highest has been determined. A responsible bidder who submitted the lowest bid as determined by this section shall be awarded the contract, if it is awarded. This section does not preclude the trustees from adding to or deducting from the contract any of the additive or deductive items after the lowest responsible bidder has been determined. (e) Nothing in this section shall preclude the prequalification of subcontractors. SEC. 3. Section 20103.8 of the Public Contract Code is amended to read: 20103.8. A local agency may require a bid for a public works contract to include prices for items that may be added to, or deducted from, the scope of work in the contract for which the bid is being submitted. Whenever additive or deductive items are included in a bid, the bid solicitation shall specify which one of the following methods will be used to determine the lowest bid. In the absence of such a specification, only the method provided by subdivision (a) will be used: (a) The lowest bid shall be the lowest bid price on the base contract without consideration of the prices on the additive or deductive items. (b) The lowest bid shall be the lowest total of the bid prices on the base contract and those additive or deductive items that were specifically identified in the bid solicitation as being used for the purpose of determining the lowest bid price. (c) The lowest bid shall be the lowest total of the bid prices on the base contract and those additive or deductive items taken in order from a specifically identified list of those items that, when in the solicitation, and added to, or subtracted from, the base contract, are less than, or equal to, a funding amount publicly disclosed by the local agency before the first bid is opened. (d) The lowest bid shall be determined in a manner that prevents any information that would identify any of the bidders or proposed subcontractors or suppliers from being revealed to the public entity before the ranking of all bidders from lowest to highest has been determined. A responsible bidder who submitted the lowest bid as determined by this section shall be awarded the contract, if it is awarded. This section does not preclude the local agency from adding to or deducting from the contract any of the additive or deductive items after the lowest responsible bidder has been determined. (e) Nothing in this section shall preclude the prequalification of subcontractors.