BILL ANALYSIS Ó
AB 943
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Date of Hearing: May 11, 2011
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Cameron Smyth, Chair
AB 943 (Williams) - As Amended: May 2, 2011
SUBJECT : Public contracts: local contracts: alternative
procedures.
SUMMARY : Increases the formal bidding threshold under the
Uniform Public Construction Cost Accounting Act (UPCCAA) from
$125,000 to $175,000. Specifically, this bill :
1)Increases the formal bidding threshold under UPCCAA from
$125,000 to $175,000.
2)Authorizes the governing body of a public agency on a
four-fifths vote to award a contract at $187,500, or less, to
the lowest responsible bidder if the following occur:
a) All bids received under informal bidding procedures are
in excess of $175,000; and,
b) The governing body determines the cost estimate of the
public agency was reasonable.
EXISTING LAW :
1)Authorizes public agencies to opt in to UPCCAA.
2)Requires public agencies who opt in to UPCCAA to use the
following thresholds:
a) Public projects of $30,000 or less are authorized to be
performed by the employees of a public agency by force
account, negotiated contract, or by purchase order;
b) Public projects of $125,000 or less are authorized to be
let to contract by informal procedures as established under
UPCCAA; and,
c) Public projects of more than $125,000 are required to be
let to contract by formal bidding procedure, except as
otherwise provided in UPCCAA.
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3)Requires the Uniform Public Construction Cost Accounting
Commission (Commission) to review the accounting procedures of
a participating public agency when an interested party
presents evidence that the work undertaken by the public
agency falls within any of the following categories:
a) The work is to be performed by a public agency after
rejecting all bids, claiming work can be done less
expensively by the public agency;
b) The work exceeded the force account limits; or,
c) The work has been improperly classified as maintenance.
4)Authorizes the governing body of a public agency on a
four-fifths vote to award a contract at $137,500, or less, to
the lowest responsible bidder if the following occur:
a) All bids received under informal bidding procedures are
in excess of $125,000; and,
b) The governing body determines the cost estimate of the
public agency was reasonable.
FISCAL EFFECT : None
COMMENTS :
1)The Public Contract Code spells out the procedures that local
agencies are required to follow when they build public works
projects, including limits on the contracts' values. However,
when local agencies voluntarily use UPCCAA, they can use their
own employees for projects worth $30,000 or less. Projects
worth $125,000 or less require informal bidding and those
worth more than $125,000 require formal bidding. UPCCAA
requires the Commission to review these limits to account for
higher costs every five years. If the Commission recommends
higher limits, the State Controller promulgates the new
limits. The Commission and the Controller last raised these
limits in 2005, with them taking effect in 2007.
At the Commission's March 30, 2011, hearing, the members
approved raising the formal bidding threshold to $175,000.
This recommendation was forwarded to the Controller, who
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adopted the recommendation and sent out a letter notifying all
the public agencies who have opted in to UPCCAA of the change
to be effective July 1, 2011. AB 943 would codify this new
threshold, which will be in place via the UPCCAA manual by the
time AB 943 goes into effect.
The Commission does not have the statutory authority to raise
the informal bidding cap that can be used in cases where there
is a four-fifths vote of the governing body, all bids received
under informal bidding procedures were in excess of informal
bidding cap, and the governing body determines the cost
estimate of the public agency was reasonable. AB 943 will
raise that threshold from $137,500 to $187,500.
2)According to the author, AB 935 seeks to codify a proposal
adopted by the Commission at its March 30, 2011, meeting.
3)Support arguments: Supporters say AB 935 will provide
additional flexibility for agencies that have voluntarily
chosen to abide by UPCCAA.
Opposition arguments: Opposition might argue AB 935 is
premature and the Committee should wait to hear from the
Commission itself regarding this proposal.
REGISTERED SUPPORT / OPPOSITION :
Support
Air Conditioning Sheet Metal Association
Air-conditioning & Refrigeration Contractors Association
American Fence Association, CA Chapter
Associated General Contractors
CA Fence Contractors' Association
CA Landscape & Irrigation Council
CA Legislative Conference of the Plumbing, Heating and Piping
Industry
CA State Association of Counties
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Coalition for Adequate School Housing
Construction Industry Force Account Council
Desert Water Agency
Engineering Contractors' Association
Flasher Barricade Association
League of CA Cities
Marin Builders Association
National Electrical Contractors Association, CA Chapters
Regional Council of Rural Counties
Opposition
None on file
Analysis Prepared by : Jennifer Klein Baldwin / L. GOV. /
(916) 319-3958