BILL ANALYSIS
AB 1650
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1650 (Feuer, Blumenfield and Huffman)
As Amended August 31, 2010
Majority vote
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|ASSEMBLY: |74-0 |(June 1, 2010) |SENATE: |29-3 |(August 31, |
| | | | | |2010) |
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Original Committee Reference: B. P. & C.P.
SUMMARY : Prohibits persons engaging in investment activities in
Iran's energy sector, as specified, from bidding or entering
into contracts with a public entity for goods or services.
The Senate amendments :
1)Delete the requirement for individuals to certify that they
have not invested in Iran in the previous three years, and
instead require that a person who has engaged in business
outside the United States to certify that he or she does not
engage in investment activities in Iran's energy sector, when
bidding or entering into a contract.
2)Add a delayed implementation date of 90 days after this bill
becomes effective, for prohibiting a person that engages in
investment activities in Iran from bidding on, submitting a
proposal for, or entering into a contract with a public entity
for goods or services with the public entity; and,
3)Require the Department of General Services (DGS), by June 1,
2011, to develop a list of persons investing in Iran, and:
a) Prohibit persons identified on the list from biding on,
submitting a proposal for, or entering into a contract with
a public entity for goods or services of $1 million or
more, beginning June 1, 2011;
b) Require individuals and financial institutions to
certify that they are not on the list, beginning June 1,
2011, unless otherwise specified;
c) Require DGS to update the list every 180 days;
AB 1650
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d) Require DGS to provide 90 days' notice to persons prior
to putting their name on the list, and an opportunity to
subsequently appeal their inclusion on the list; and,
e) Allow DGS to charge a fee to those who use the list,
except to any public entity and the Legislature, to cover
administrative costs.
4)Prohibit a financial institution that extends $20 million or
more in credit, for 45 days or more, to a person who provides
goods or services to Iran's energy sector and is identified on
DGS' list as investing in Iran, from bidding on, submitting a
proposal for, or entering into a contract with a public entity
for goods or services of $1 million or more, beginning July 1,
2010.
5)Allow a financial institution investing in Iran to bid on,
submit a proposal for, or enter into a contract for goods or
services of $1 million or more with a public entity if the
person using the credit to provide goods or services in Iran's
energy sector is allowed on a case-by-case basis.
6)Exempt California Public Employees' Retirement System or State
Teachers' Retirement System contracts from the provision of
this bill.
7)Limit the imposition of a civil penalty to one per public
entity and particular investment, and add a statute of
limitations to collect the penalties three years from the date
the false certification was made.
8)Prohibit an unsuccessful bidder, or any person other than the
awarding body, from protesting a contract award or renewal
based on a false certification.
9)Authorize a pubic entity to permit, on a case-by-case basis,
individuals investing in Iran, to bid on, submit a proposal
for, or enter into a contract for goods or services of $1
million or more if either of the following are true:
a) The investments in Iran were made before July 1, 2010,
and have not been expanded or renewed, the awarding body
determines that it is in the state's best interests, and
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the person has a formal plan to cease investments in Iran;
or,
b) One of the following occurs:
i) The local entity finds that it would be unable to
otherwise obtain the goods or services for local
contracts;
ii) The Governor finds that a state agency would be
unable to otherwise obtain the goods or services for
state contracts; or,
iii) A constitutional officer finds that a state
constitutional office would be unable to otherwise obtain
the goods or services for state contracts.
10)Recast the definition of a person as engaging in the
"investment activities in Iran" to include:
a) The person provides goods or services of $20 million to
Iran's energy sector; and,
b) The person is a financial institution that extends $20
million or more in credit to another person, for 45 days or
more, if that person provides goods or services to Iran's
energy sector and is identified on DGS' list as investing
in Iran.
11)Delete the contingency that this bill is operative upon the
enactment of federal legislation authorizing states to adopt
and enforce contracting prohibitions provided for in this
bill.
12)Revise the term "Iran" to include the Government of Iran (in
addition to any agency of instrumentality of Iran).
13)Define the term "awarding body" as the following:
a) DGS, for state goods and service contracts of $1 million
or more; and,
b) The representative of the local entity awarding the
contract, for local goods and service contracts of $1
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million or more.
14)Delete and add findings and declaration relating to federal
legislation on divesting from Iran.
15)Make technical and clarifying amendments.
AS PASSED BY THE ASSEMBLY , this bill prohibited persons engaging
in investment activities in Iran's energy sector, as specified,
from bidding or entering into contracts with a public entity for
goods or services.
FISCAL EFFECT : According to Senate Appropriations Committee,
this bill authorizes DGS to assess a fee in order to pay the
costs of creating and maintaining the list. Certification of
eligibility to submit a proposal for, or enter into or renew, a
contract in this manner is likely less costly to implement and
administer when compared to a by-department certification
process set for in the August 4 version of this bill. The new
state contracting requirements and restrictions will in unknown
potential increased costs for state goods, services and
borrowing.
COMMENTS : This bill was amended in the Senate and is
consistent with Assembly actions.
Analysis Prepared by : Joanna Gin / B., P. & C.P. / (916)
319-3301
FN: 0006901