BILL ANALYSIS
AB 2403
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CONCURRENCE IN SENATE AMENDMENTS
AB 2403 (Smyth)
As Amended June 30, 2008
Majority vote
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|ASSEMBLY: |78-0 |(May 28, 2008) |SENATE: |27-11|(August 14, |
| | | | | |2008) |
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Original Committee Reference: TRANS.
SUMMARY : Authorizes the Department of Transportation (Caltrans)
to purchase and equip heavy mobile fleet vehicles and special
equipment by means of "best value" procurement.
The Senate amendments change the date, from January 1, 2014, to
October 1, 2013, by which Caltrans is required to submit a
report to the Legislature that includes an evaluation of the
best value procurement process.
EXISTING LAW requires:
1)The Department of General Services (DGS) to investigate and
establish the need to acquire all state-owned motor vehicles.
2)All state agency contracts for the acquisition of motor
vehicles to be made by, or under the supervision of, DGS.
3)Generally, state agency contracts for goods and services to be
awarded to the lowest bidder. Exceptions are made, however,
for information technology equipment which can be procured
using a value-effective acquisition process. Contracts for
the acquisition of information technology goods or services
are made under the supervision of DGS.
AS PASSED BY THE ASSEMBLY, this bill was substantially similar
to the version approved by the Senate.
FISCAL EFFECT : According to Senate Appropriations Committee:
1)Initial increases in purchase price for heavy vehicles and
equipment of about $750,000 over five years, beginning in
2009-2010; and,
AB 2403
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2)Long-term savings, according to Caltrans, of $300,000 annually
over the life of the equipment due to lower maintenance and
repair costs, improved performance and fuel efficiency, and
increased resale value.
COMMENTS : According to the author, Caltrans must currently
purchase heavy equipment using the "low bid" process, which
means the low bidder is selected regardless of whether or not
the equipment being purchased performs better, gets better gas
mileage, has a better warranty. In some cases, Caltrans must
work with unreliable suppliers, late deliveries, poor
performance, limited warranties, high maintenance costs, and
excessive "down time" because the low bidder does not always
provide a high quality product.
This bill would allow Caltrans to consider multiple factors, in
addition to price, when purchasing heavy and special equipment.
While the initial outlay may be higher for equipment purchases
initially, Caltrans expects that the "best value bid" pilot will
demonstrate an overall cost savings for the state through the
purchase of heavy and special equipment that has longer life,
improved performance, improved fuel efficiency, reduced
maintenance costs, improved warranties, and higher resale and
salvage values.
According to Caltrans' Web site, its fleet is comprised of over
13,000 pieces of equipment.
The Idaho Transportation Department writes in support of the
bill that its experience with various types of bid evaluations
has allowed it to purchase equipment that performs better,
safer, and at lower operating than purchases made based just on
low cost.
Related legislation: AB 2560 (Lieu), pending in the Senate,
requires, on or before December 31, 2009, DGS, in conjunction
with the State Air Resources Board and the State Energy
Resources Conservation and Development Commission, to rank the
environmental and energy benefits and costs of medium-duty and
heavy-duty motor vehicles for potential procurement by state and
local agencies. AB 2403 would become operative only if AB 2560
is enacted.
AB 2403
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Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093
FN: 0006770