BILL NUMBER: AB 1986	CHAPTERED
	BILL TEXT

	CHAPTER  346
	FILED WITH SECRETARY OF STATE  SEPTEMBER 20, 2006
	APPROVED BY GOVERNOR  SEPTEMBER 20, 2006
	PASSED THE ASSEMBLY  AUGUST 21, 2006
	PASSED THE SENATE  AUGUST 16, 2006
	AMENDED IN SENATE  AUGUST 7, 2006
	AMENDED IN ASSEMBLY  APRIL 26, 2006
	AMENDED IN ASSEMBLY  APRIL 6, 2006

INTRODUCED BY   Assembly Member De La Torre

                        FEBRUARY 9, 2006

   An act to add Section 89911 to the Education Code, and to amend
Sections 10701 and 10704 of, and to add Section 10706.5 to, the
Public Contract Code, relating to public contracts.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1986, De La Torre  Public contracts: California State
University: auxiliary organizations.
   (1) Existing law establishes the California State University under
the administration of the Trustees of the California State
University. Existing law authorizes the establishment of auxiliary
organizations, as defined, of the university for various purposes
consistent with the mission of the university. The California State
University Contract Law (CSU contract law) sets forth a process
through which contracts for projects, as defined, that are entered
into with respect to the California State University may be
competitively bid, entered into, and executed. The CSU contract law
requires that a project be under the sole and direct control of the
trustees pursuant to the administrative authority granted to them by
existing law. The CSU contract law authorizes the trustees and the
Department of General Services to enter into an agreement under which
the department will carry out any of the functions of the trustees
under the law, upon terms that are mutually agreed upon. The CSU
contract law requires that any subcontractor or agent, or employee of
any contractor or subcontractor, who has knowledge of any work done
in violation of any contract under the CSU contract law, and does not
immediately notify the trustees or the inspector or resident
engineer upon the project of the violation, is guilty of a felony.
   This bill would require that any construction project located on
property of the California State University that is performed by an
auxiliary organization of the California State University and funded
in whole or in part by public funds is subject to the CSU contract
law, and would deem that construction project to be under the sole
and direct control of the trustees for the purposes of the CSU
contract law. The bill would authorize the trustees to enter into an
agreement under which the auxiliary organization may carry out any of
the functions of the trustees under the CSU contract law, upon terms
that are mutually agreed upon. Because the bill would extend the
scope of the CSU contract law, the bill would impose a state-mandated
local program by creating a new crime.
  (2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 89911 is added to the Education Code, to read:

   89911.  Any construction project located on property of the
California State University that is performed pursuant to a contract
entered into or awarded by an auxiliary organization and funded in
whole or in part by public funds is subject to the California State
University Contract Law (Chapter 2.5 (commencing with Section 10700)
of Part 2 of Division 2 of the Public Contract Code).
  SEC. 2.  Section 10701 of the Public Contract Code is amended to
read:
   10701.  As used in this chapter:
   (a) "Project" includes the erection, construction, alteration,
painting, repair, or improvement of any state structure, building,
road, or other state improvement of any kind. "Project" includes a
project located on California State University property and performed
pursuant to a contract entered into or awarded by an auxiliary
organization, as defined in Section 89901 of the Education Code, and
funded in whole or in part by public funds.
   (b) "Service contract" means any contract for services in
connection with a project other than a project contract, and
includes, but is not limited to, contracts for architectural,
engineering, planning, testing, general studies, or feasibility
services.
   (c) "Trustees" means the Trustees of the California State
University and their designees.
  SEC. 3.  Section 10704 of the Public Contract Code is amended to
read:
   10704.  The project shall be under the sole and direct control of
the trustees, pursuant to the powers and responsibilities invested in
them by Chapter 8 (commencing with Section 66600) of Part 40 of
Division 5 of Title 3 of the Education Code. For the purposes of this
chapter, a project located on California State University property
and performed pursuant to a contract entered into or awarded by an
auxiliary organization, as defined in Section 89901 of the Education
Code, and funded in whole or in part by public funds, shall be deemed
to be under the sole and direct control of the trustees.
  SEC. 4.  Section 10706.5 is added to the Public Contract Code, to
read:
   10706.5.  The trustees may enter into an agreement with an
auxiliary organization, as defined in Section 89901 of the Education
Code, under which the auxiliary organization may carry out any of the
functions of the trustees under this chapter, upon terms that are
mutually agreed upon.
  SEC. 5.   No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.