BILL NUMBER: AB 958	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Eng

                        FEBRUARY 26, 2009

   An act to add Section 21568 to the Public Contract Code, relating
to public contracts.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 958, as introduced, Eng. Design-build: metropolitan water
districts: solar energy systems.
   Existing law sets forth requirements for the solicitation and
evaluation of bids and the awarding of contracts by public entities
for the erection, construction, alteration, repair, or improvement of
any public structure, building, road, or other public improvement.
Existing law also authorizes specified state agencies, cities, and
counties to implement alternative procedures for the awarding of
contracts on a design-build basis.
   This bill would authorize a metropolitan water district to enter
into design-build contracts for projects involving the design,
construction, fabrication, and installation of a solar energy system
in excess of $1,000,000, in accordance with specified provisions. The
bill would establish a procedure for submitting bids that includes a
requirement that design-build entities provide a statement of
qualifications submitted to the transportation entity that is
verified under oath. Because a verification under oath is made under
penalty of perjury, the bill would, by requiring a verification,
create a new crime and thereby impose a state-mandated local program.

   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.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


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

  SECTION 1.  Section 21568 is added to the Public Contract Code, to
read:
   21568.  (a) (1) Notwithstanding the requirements of Section 21565,
this section provides an alternative procedure that a metropolitan
water district may utilize in the design, construction, fabrication,
and installation of a solar energy system, including ancillary
improvements directly related to the solar energy system, in excess
of one million dollars ($1,000,000).
   (2) Metropolitan water districts may award a project under this
section using either the lowest responsible bidder or by best value.
   (b) (1) It is the intent of the Legislature to enable metropolitan
water districts to utilize cost-effective options for the
installation of solar energy facilities.
   (2) The Legislature finds that cost-effective benefits are
achieved by shifting the liability and risk for cost containment and
project completion to the design-build entity.
   (3) It is the intent of the Legislature to provide an alternative
and optional procedure for bidding and building solar construction
projects for metropolitan water districts.
   (c) The design-build approach authorized by this section may be
used, but is not limited to use, when it is anticipated that it will
do any of the following:
   (1) Reduce project cost.
   (2) Expedite project completion.
   (3) Provide design features not achievable through the
design-bid-build method.
   (d) If a metropolitan water district elects to proceed under this
section, the metropolitan water district shall establish and enforce,
for design-build projects, a labor compliance program containing the
requirements outlined in Section 1771.5 of the Labor Code, or it
shall contract with a third party to operate a labor compliance
program containing the requirements outlined in Section 1771.5 of the
Labor Code. This requirement shall not apply to any project where
the metropolitan water district or the design-build entity has
entered into any collective bargaining agreement or agreements that
bind all of the contractors performing work on the projects.
   (e) As used in this section, the following terms have the
following meanings:
   (1) "Best value" means a value determined by objectives relative
to price, features, functions, and life-cycle costs.
   (2) "Design-build" means a procurement process in which both the
design and construction of a project are procured from a single
entity.
   (3) "Design-build entity" means a partnership, corporation, or
other legal entity that is able to provide appropriately licensed
contracting, architectural, and engineering services, as needed,
pursuant to a design-build contract.
   (4) "Project" means the construction of solar energy installations
at regional or local water facilities including ancillary
improvements directly related to the solar energy system.
   (f) Design-build projects shall progress in a four-step process,
as follows:
   (1) (A) The metropolitan water district shall prepare a set of
documents setting forth the scope of the project. The documents may
include, but are not limited to, the size, type, and desired design
character of the buildings and site, performance specifications
covering the quality of materials, equipment, and workmanship,
preliminary plans or building layouts, or any other information
deemed necessary to describe adequately the metropolitan water
district's needs. The performance specifications and any plans shall
be prepared by a design professional who is duly licensed and
registered in California.
   (B) Any architect or engineer retained by the metropolitan water
district to assist in the development of the project-specific
documents shall not be eligible to participate in the preparation of
a bid with any design-build entity for that project.
   (2) (A) Based on the documents prepared in paragraph (1), the
metropolitan water district shall prepare a request for proposals
that invites interested parties to submit competitive sealed
proposals in the manner prescribed by the metropolitan water
district. The request for proposals shall include, but is not limited
to, the following elements:
   (i) Identification of the basic scope and needs of the project or
contract, the expected cost range, and other information deemed
necessary by the metropolitan water district to inform interested
parties of the contracting opportunity, including, but not limited
to, the methodology that will be used by the metropolitan water
district to evaluate proposals, and, specifically, if the contract
will be awarded to the lowest responsible bidder.
   (ii) Significant factors which the metropolitan water district
reasonably expects to consider in evaluating proposals, including
cost or price and all nonprice related factors.
   (iii) The relative importance of weight assigned to each of the
factors identified in the request for proposals.
   (B) With respect to clause (iii) of subparagraph (A), if a
nonweighted system is used, the agency shall specifically disclose
whether all evaluation factors, other than cost or price, when
combined are:
   (i) Significantly more important than cost or price.
   (ii) Approximately equal in importance to cost or price.
   (iii) Significantly less important than cost or price.
   (C) If the metropolitan water district chooses to reserve the
right to hold discussions or negotiations with responsive bidders, it
shall so specify in the request for proposal and shall publish
separately, or incorporate into the request for proposal, applicable
rules and procedures to be observed by the metropolitan water
district to ensure that any discussions or negotiations are conducted
in good faith.
   (3) (A) The metropolitan water district shall establish a
procedure to prequalify design-build entities using a standard
questionnaire developed by the metropolitan water district. In
preparing the questionnaire, the metropolitan water district shall
consult with the construction industry, including representatives of
the building trades and surety industry. This questionnaire shall
require information, including, but not limited to, all of the
following:
   (i) If the design-build entity is a partnership, limited
partnership, or other association, a listing of all of the partners,
general partners, or association members known at the time of bid
submission who will participate in the design-build contract,
including, but not limited to, mechanical subcontractors.
   (ii) Evidence that the members of the design-build entity have
completed, or demonstrated the experience, competency, capability,
and capacity to complete projects of similar size, scope, or
complexity, and that proposed key personnel have sufficient
experience and training to competently manage and complete the design
and construction of the project, as well as a financial statement
that assures the metropolitan water district that the design-build
entity has the capacity to complete the project.
   (iii) The licenses, registration, and credentials required to
design and construct the project, including information on the
revocation or suspension of any license, credential, or registration.

   (iv) Evidence that establishes that the design-build entity has
the capacity to obtain all required payment and performance bonding,
liability insurance, and errors and omissions insurance.
   (v) Any prior serious or willful violation of the California
Occupational Safety and Health Act of 1973, contained in Part 1
(commencing with Section 6300) of Division 5 of the Labor Code or the
federal Occupational Safety and Health Act of 1970 (Public Law
91-596), settled against any member of the design-build entity, and
information concerning workers' compensation experience history and
worker safety program.
   (vi) Information concerning any debarment, disqualification, or
removal from a federal, state, or local government public works
project. Any instance where an entity, its owners, officers, or
managing employees submitted a bid on a public works project and were
found to be nonresponsive, or were found by an awarding body not to
be a responsible bidder.
   (vii) Any instance where the entity, its owners, officers, or
managing employees defaulted on a construction contract.
   (viii) Any violations of the Contractors' State License Law
(Chapter 9 (commencing with Section 7000) of Division 3 of the
Business and Professions Code), excluding alleged violations of
federal or state law including the payment of wages, benefits,
apprenticeship requirements, or personal income tax withholding, or
of Federal Insurance Contribution Act (FICA; 26 U.S.C. Sec. 3101 et
seq.) withholding requirements settled against any member of the
design-build entity.
   (ix) Information concerning the bankruptcy or receivership of any
member of the design-build entity, including information concerning
any work completed by a surety.
   (x) Information concerning all settled adverse claims, disputes,
or lawsuits between the owner of a public works project and any
member of the design-build entity during the five years preceding
submission of a bid pursuant to this section, in which the claim,
settlement, or judgment exceeds fifty thousand dollars ($50,000).
Information shall also be provided concerning any work completed by a
surety during this period.
   (xi) In the case of a partnership or other association that is not
a legal entity, a copy of the agreement creating the partnership or
association and specifying that all partners or association members
agree to be fully liable for the performance under the design-build
contract.
   (B) The information required pursuant to this subdivision shall be
verified under oath by the entity and its members in the manner in
which civil pleadings in civil actions are verified. Information that
is not a public record pursuant to the California Public Records Act
(Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code) shall not be open to public inspection.
   (4) The metropolitan water district shall establish a procedure
for final selection of the design-build entity. Selection shall be
based on either of the following criteria:
   (A) A competitive bidding process resulting in lump-sum bids by
the prequalified design-build entities. Awards shall be made to the
lowest responsible bidder.
   (B) The metropolitan water district may use a design-build
competition based upon best value and other criteria set forth in
paragraph (2). The design-build competition shall include the
following elements:
   (i) Competitive proposals shall be evaluated by using only the
criteria and selection procedures specifically identified in the
request for proposal. However, the following minimum factors shall
each represent at least 10 percent of the total weight of
consideration given to all criteria factors: price, technical design
and construction expertise, life-cycle costs over 15 years or more,
skilled labor force availability, and acceptable safety record. Each
of these factors shall be weighted equally.
   (ii) Once the evaluation is complete, the top three responsive
bidders shall be ranked sequentially from the most advantageous to
the least.
   (iii) The award of the contract shall be made to the responsible
bidder whose proposal is determined, in writing, to be the most
advantageous.
   (iv) Notwithstanding any provision of this code, upon issuance of
a contract award, the metropolitan water district shall publicly
announce its award, identifying the contractor to whom the award is
made, along with a written decision supporting its contract award and
stating the basis of the award. The notice of award shall also
include the metropolitan water district's second and third ranked
design-build entities.
   (v) For purposes of this paragraph, "skilled labor force
availability" shall be determined by the existence of an agreement
with a registered apprenticeship program, approved by the California
Apprenticeship Council, which has graduated apprentices in each of
the preceding five years. This graduation requirement shall not apply
to programs providing apprenticeship training for any craft that has
been deemed by the Department of Labor and the Department of
Industrial Relations to be an apprenticeable craft in the five years
prior to enactment of this act.
   (vi) For the purposes of this paragraph, a bidder's "safety record"
shall be deemed "acceptable" if their experience modification rate
for the most recent three-year period is an average of 1.00 or less,
and their average total recordable injury/illness rate and average
lost work rate for the most recent three-year period does not exceed
the applicable statistical standards for its business category, or if
the bidder is a party to an alternative dispute resolution system,
as provided for in Section 3201.5 of the Labor Code.
   (g) (1) Any design-build entity that is selected to design and
build a project pursuant to this section shall possess or obtain
sufficient bonding to cover the contract amount for nondesign
services and errors and omissions insurance coverage sufficient to
cover all design and architectural services provided in the contract.
This section does not prohibit a general or engineering contractor
from being designated the lead entity on a design-build entity for
the purposes of purchasing necessary bonding to cover the activities
of the design-build entity.
   (2) Any payment or performance bond written for the purposes of
this section shall be written using a bond form developed by the
metropolitan water district.
   (h) All subcontractors that were not listed by the design-build
entity in accordance with clause (i) of subparagraph (A) of paragraph
(3) of subdivision (f) shall be awarded by the design-build entity
in accordance with the design-build process set forth by the
metropolitan water district in the design-build package. All
subcontractors bidding on contracts pursuant to this section shall be
afforded the protections contained in Chapter 4 (commencing with
Section 4100) of Part 1. The design-build entity shall do both of the
following:
   (1) Provide public notice of the availability of work to be
subcontracted in accordance with the publication requirements
applicable to the competitive bidding process of the metropolitan
water district.
   (2) Provide a fixed date and time on which the subcontracted work
will be awarded in accordance with the procedure established pursuant
to this section.
   (i) The minimum performance criteria and design standards
established pursuant to paragraph (1) of subdivision (f) shall be
adhered to by the design-build entity. Any deviations from those
standards may only be allowed by written consent of the metropolitan
water district.
   (j) The metropolitan water district may retain the services of a
design professional or construction project manager, or both,
throughout the course of the project in order to ensure compliance
with this section.
   (k) Contracts awarded pursuant to this section shall be valid
until the project is completed.
   (l) Nothing in this section is intended to affect, expand, alter,
or limit any rights or remedies otherwise available at law.
   (m) Nothing in this section shall affect either of the following:
   (1) The restrictions on subcontracting imposed by a metropolitan
water district's merit system, or any memorandum of understanding or
operating policy.
   (2) (2) The obligation of the metropolitan water district to meet
and confer with any employee organization concerning a matter within
the statutory scope of representation.
   (n) Any design-build project procured under this section shall
provide for training of the permanent employees of the metropolitan
water district to maintain and repair the project once completed.
   (o) (1) If the metropolitan water district elects to award a
project pursuant to this section, retention proceeds withheld by the
metropolitan water district from the design-build entity shall not
exceed 5 percent if a performance and payment bond, issued by an
admitted surety insurer, is required in the solicitation of bids.
   (2) In a contract between the design-build entity and the
subcontractor, and in a contract between a subcontractor and any
subcontractor thereunder, the percentage of the retention proceeds
withheld shall not exceed the percentage specified in the contract
between the metropolitan water district and the design-build entity.
If the design-build entity provides written notice to any
subcontractor who is not a member of the design-build entity, prior
to or at the time the bid is requested, that a bond may be required
and the subcontractor subsequently is unable or refuses to furnish a
bond to the design-build entity, then the design-build entity may
withhold retention proceeds in excess of the percentage specified in
the contract between the metropolitan water district and the
design-build entity from any payment made by the design-build entity
to the subcontractor.
   (p) (1) The authority for design-build projects contained in this
section is a new and independent authorization and shall not
supersede, limit, or restrict any other statutory design-build
authorization.
   (2) Nothing in this section shall be construed to change the
authority of a state department, agency, board, or commission.
   (3) A qualified entity may use state funds for projects utilizing
the design-build procedure under this section.
   (4) Except as provided in this section, nothing in this section
shall be construed to affect the application of any other law.
  SEC. 2.  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.