BILL NUMBER: SB 224 CHAPTERED
BILL TEXT
CHAPTER 587
FILED WITH SECRETARY OF STATE OCTOBER 8, 2011
APPROVED BY GOVERNOR OCTOBER 8, 2011
PASSED THE SENATE SEPTEMBER 8, 2011
PASSED THE ASSEMBLY SEPTEMBER 6, 2011
AMENDED IN ASSEMBLY SEPTEMBER 1, 2011
AMENDED IN SENATE APRIL 14, 2011
AMENDED IN SENATE MARCH 17, 2011
INTRODUCED BY Senator Pavley
FEBRUARY 9, 2011
An act to amend Sections 10296, 10335, 10340, and 10430 of, and to
add Sections 10295.6 and 10304.1 to, the Public Contract Code,
relating to public contracts.
LEGISLATIVE COUNSEL'S DIGEST
SB 224, Pavley. Public contracts: Department of Water Resources.
Existing law provides that specified contracts entered into by any
state agency for goods, services, or other specified activities,
whether awarded through competitive bidding or not, are void unless
and until approved by the Department of General Services, and
approval shall be denied if the contract does not meet the required
specifications of the bidding process. That law exempts certain
transactions and contracts from that law, as specified. Existing law
requires state agencies to secure at least 3 competitive bids for
each contract and exempts specified contracts from this requirement.
This bill would make those laws inapplicable to any contract
entered into by the Department of Water Resources for the
acquisition, sale, or transmission of power, or for related services,
as specified. This bill would authorize the Department of Water
Resources to award contracts for the acquisition of specialized
equipment for facilities of the State Water Resources Development
System, and would require the Department of Water Resources, in
collaboration with the Department of General Services, to establish
the conditions under which a contract in excess of $25,000 is awarded
without the competitive bidding process, as specified. This bill
would include in the list of exempt contracts that do not require 3
competitive bids, contracts for services for the operation,
maintenance, repair, or replacement of specialized equipment at
facilities of the State Water Resources Development System and other
specified contracts entered into by the Department of Water
Resources, as provided. This bill would require the Department of
Water Resources to be governed by the laws regarding contracting for
goods and services by state agencies, as prescribed.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 10295.6 is added to the Public Contract Code,
to read:
10295.6. Sections 10295 and 10297 do not apply to any contract
entered into by the Department of Water Resources under Part 3
(commencing with Section 11100) of Division 6 or Chapter 8
(commencing with Section 12930) of Part 6 of Division 6 of the Water
Code for the acquisition, sale, or transmission of power, or for
services to facilitate such activities.
SEC. 2. Section 10296 of the Public Contract Code is amended to
read:
10296. (a) Every contract entered into by any state agency for
any purpose specified in subdivisions (a) to (d), inclusive, of
Section 10295, or in Section 10295.6, shall contain a statement by
which the contractor swears under penalty of perjury that no more
than one final, unappealable finding of contempt of court by a
federal court has been issued against the contractor within the
immediately preceding two-year period because of the contractor's
failure to comply with an order of a federal court which orders the
contractor to comply with an order of the National Labor Relations
Board. For purposes of this section, a finding of contempt does not
include any finding that has been vacated, dismissed, or otherwise
removed by the court because the contractor has complied with the
order which was the basis for the finding. The state may rescind any
contract in which the contractor falsely swears to the truth of the
statement required by this section.
(b) (1) This section does not apply to a credit card purchase of
goods of two thousand five hundred dollars ($2,500) or less.
(2) The total amount of exemption authorized herein shall not
exceed seven thousand five hundred dollars ($7,500) per year for each
company from which a state agency is purchasing goods by credit
card. It shall be the responsibility of each state agency to monitor
the use of this exemption and adhere to these restrictions on these
purchases.
SEC. 3. Section 10304.1 is added to the Public Contract Code, to
read:
10304.1. Notwithstanding Sections 10301, 10302, and 10304, the
Department of Water Resources may award contracts for the acquisition
of specialized equipment for facilities of the State Water Resources
Development System, as defined in Section 12931 of the Water Code.
Prior to exercising the authority granted by this section, the
Department of Water Resources, in collaboration with the department,
shall establish the conditions under which any contract in excess of
twenty-five thousand dollars ($25,000) is awarded without the
competitive bidding process. The conditions shall be developed to
expedite operations and maintenance work to reduce the risk of the
loss of water or power to the State Water Resources Development
System, and shall require the Department of Water Resources to
prepare a written document declaring that the contract meets those
conditions. Consistent with its authority under Section 10297, the
department shall review those contracts for consistency with the
conditions established pursuant to this section.
SEC. 4. Section 10335 of the Public Contract Code is amended to
read:
10335. (a) This article shall apply to all contracts, including
amendments, entered into by any state agency for services to be
rendered to the state, whether or not the services involve the
furnishing or use of equipment, materials, or supplies or are
performed by an independent contractor. Except as provided in
Sections 10295.6 and 10351, and paragraphs (8) and (9) of subdivision
(b) of Section 10340, all contracts subject to this article are of
no effect unless and until approved by the department. Each contract
shall be transmitted with all papers, estimates, and recommendations
concerning it to the department and, if approved by the department,
shall be effective from the date of approval. This article shall
apply to any state agency that by general or specific statute is
expressly or impliedly authorized to enter into the transactions
referred to in this section. This article shall not apply to
contracts for the construction, alteration, improvement, repair, or
maintenance of real or personal property, contracts for services
subject to Chapter 10 (commencing with Section 4525) of Division 5 of
Title 1 of the Government Code, to contracts that are listed as
exceptions in Section 10295, contracts of less than five thousand
dollars ($5,000) in amount, contracts of less than five thousand
dollars ($5,000) where only per diem or travel expenses, or a
combination thereof, are to be paid, contracts between state
agencies, or contracts between a state agency and local agency or
federal agency.
(b) In exercising its authority under this article with respect to
contracts for the services of legal counsel, other than the Attorney
General, entered into by any state agency that is subject to Section
11042 or Section 11043 of the Government Code, the department, as a
condition of approval of the contract, shall require the state agency
to demonstrate that the consent of the Attorney General to the
employment of the other counsel has been granted pursuant to Section
11040 of the Government Code. This consent shall not be construed in
a manner that would authorize the Attorney General to establish a
separate program for reviewing and approving contracts in the place
of, or in addition to, the program administered by the department
pursuant to this article.
(c) Until January 1, 2001, the department shall maintain a list of
contracts approved pursuant to subdivision (b). This list shall be
filed quarterly with the Senate Committee on Budget and Fiscal Review
and the Assembly Committee on Budget. The list shall be limited to
contracts with a consideration in excess of twenty thousand dollars
($20,000) during the life of the contract and shall include
sufficient information to identify the provider of legal services,
the length of each contract, applicable hourly rates, and the need
for the services. The department shall add a contract that meets
these conditions to the list within 10 days after approval. A copy of
the list shall be made available to any requester. The department
may charge a fee to cover the cost of supplying the list as provided
in Section 6253 of the Government Code.
(d) Contracts subject to the approval of the department shall also
have the department's approval for a modification or amendment
thereto, with the following exceptions:
(1) An amendment to a contract that only extends the original time
for completion of performance for a period of one year or less is
exempt. If the original contract was subject to approval by the
department, one fully executed copy including transmittal document,
explaining the reason for the extension, shall be sent to the legal
office of the department. A contract may only be amended once under
this exemption.
(2) Contracts let or awarded on the basis of a law requiring
competitive bidding may be modified or amended only if the contract
so provides or if authorized by the law requiring competitive
bidding.
(3) If an amendment to a contract has the effect of giving the
contract as amended an increase in monetary amount, or an agreement
by the state to indemnify or save harmless any person, the amendment
shall be approved by the department.
SEC. 5. Section 10340 of the Public Contract Code is amended to
read:
10340. (a) Except as provided by subdivision (b), state agencies
shall secure at least three competitive bids or proposals for each
contract.
(b) Three competitive bids or proposals are not required in any of
the following cases:
(1) In cases of emergency where a contract is necessary for the
immediate preservation of the public health, welfare, or safety, or
protection of state property.
(2) When the agency awarding the contract has advertised the
contract in the California State Contracts Register and has solicited
all potential contractors known to the agency, but has received less
than three bids or proposals.
(3) The contract is with another state agency, a local
governmental entity, an auxiliary organization of the California
State University, an auxiliary organization of a California community
college, a foundation organized to support the Board of Governors of
the California Community Colleges, or an auxiliary organization of
the Student Aid Commission established pursuant to Section 69522 of
the Education Code. These contracts, however, may not be used to
circumvent the competitive bidding requirements of this article.
(4) The contract meets the conditions prescribed by the department
pursuant to subdivision (a) of Section 10348.
(5) The contract has been awarded without advertising and calling
for bids pursuant to Section 19404 of the Welfare and Institutions
Code.
(6) Contracts entered into pursuant to Section 14838.5 of the
Government Code.
(7) Contracts for the development, maintenance, administration, or
use of licensing or proficiency testing examinations.
(8) The contract is for services for the operation, maintenance,
repair, or replacement of specialized equipment at facilities of the
State Water Resources Development System, as defined in Section 12931
of the Water Code, and meets the conditions established by the
Department of Water Resources for those contracts.
(9) The contract meets the conditions prescribed by the Department
of Water Resources for contracts subject to Section 10295.6.
(c) Any agency which has received less than three bids or
proposals on a contract shall document, in a manner prescribed by the
department, the names and addresses of the firms or individuals it
solicited for bids or proposals.
SEC. 6. Section 10430 of the Public Contract Code is amended to
read:
10430. This chapter does not apply to any of the following:
(a) The Regents of the University of California and the Trustees
of the California State University, except that Article 9 (commencing
with Section 10420) shall apply to the Trustees of the California
State University.
(b) (1) Transactions covered under Chapter 3 (commencing with
Section 12100), except that Sections 10365.5, 10410, and 10411 shall
apply to all transactions under that chapter.
(2) Notwithstanding paragraph (1), Section 10365.5 shall not apply
to incidental advice or suggestions made outside of the scope of a
consulting services contract.
(3) (A) Notwithstanding paragraph (1), Section 10365.5 shall not
apply to a contract that is part of a single competitive procurement
conducted in more than one stage for information technology goods or
services, when the Director of the Department of General Services and
the Chief Information Officer determine that there is no conflict of
interest under Section 10365.5 and that it is in the best interest
of the state to utilize this procurement method. Nothing in this
section shall preclude the applicability of Section 12112 to this
procurement method.
(B) The Department of General Services shall annually submit a
report on its Internet Web site describing each determination granted
pursuant to subparagraph (A), listing the basis for the
determination, and disclosing the total amount of money paid or to be
paid to the contractor under the contract that was the subject of
the determination. The department shall provide notice to the Joint
Legislative Budget Committee within 30 days of the posting of the
report.
(C) For purposes of this paragraph, "information technology" means
information technology goods or services, or both, as appropriate.
(c) Except as otherwise provided in this chapter, any entity
exempted from Section 10295. However, the Board of Governors of the
California Community Colleges shall be governed by this chapter,
except as provided in Sections 10295, 10335, and 10389. The
Department of Water Resources shall be governed by this chapter,
except as provided in Sections 10295.6, 10304.1, 10335, and 10340.
(d) Transactions covered under Chapter 10 (commencing with Section
4525) of Division 5 of Title 1 of the Government Code.
(e) Except as provided for in subdivision (c), members of boards
or commissions who receive no payment other than payment for each
meeting of the board or commission, payment for preparatory time, and
payment for per diem.
(f) The emergency purchase of protective vests for correctional
peace officers whose duties require routine contact with state prison
inmates. This subdivision shall remain operative only until January
1, 1987.
(g) Spouses of state officers or employees and individuals and
entities that employ spouses of state officers and employees, that
are vendored to provide services to regional center clients pursuant
to Section 4648 of the Welfare and Institutions Code if the vendor of
services, in that capacity, does not receive any material financial
benefit, distinguishable from the benefit to the public generally,
from any governmental decision made by the state officer or employee.