BILL ANALYSIS                                                                                                                                                                                                    Ó






                                                       Bill No:  SB 
          493
          
                 SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
                       Senator Roderick D. Wright, Chair
                           2011-2012 Regular Session
                                 Staff Analysis



          SB 493  Author:  Padilla
          As Introduced:  February 17, 2011
          Hearing Date:  March 22, 2011
          Consultant:  Art Terzakis


                                     SUBJECT  
                   State Surplus Personal Property: computers

                                   DESCRIPTION
           
          SB 493 is an  urgency  measure that requires the Department 
          of General Services (DGS) to first offer state surplus 
          computers, at less than fair market value, to public 
          computer centers and digital literacy programs that 
          received broadband grants under the American Recovery and 
          Reinvestment Act (ARRA).  Specifically, this measure:


          1.  Requires DGS, notwithstanding existing provisions of 
            law, to first offer state surplus computers at less than 
            fair market value to California ARRA broadband grantees 
            for use with an approved broadband adoption project 
            involving a public computer center or digital literacy 
            training. 

          2.  Requires DGS, on or before January 15, 2012, to report 
            to the Legislature on its implementation of the above 
            referenced provision and recommend whether other 
            nonprofits organizations working to close the "digital 
            divide" among low-income households should be eligible 
            for state surplus computers at less than fair market 
            value. 

          3.  Contains two boiler plate provisions relative to 
            reporting parameters pursuant to the requirements of AB 




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            1585, Chapter 7, Statutes of 2010. 

                                   EXISTING LAW

           Existing law requires DGS to perform various functions and 
          duties with respect to state real and personal property.

          Existing law (Public Contract Code Section 10389.1) 
          provides that, if feasible and consistent with existing 
          law, DGS shall first offer appropriate state surplus 
          personal property to school districts prior to offering 
          that property to the public, except for property more 
          appropriately suited for public safety uses.  The law also 
          authorizes DGS to offer school districts state surplus 
          personal property at  less than fair market value  if DGS 
          determines it's in the state's best interest. 

          Existing law (Government Code Section 10231.5) provides 
          that any bill introduced or amended in either house of the 
          Legislature requiring a state agency to submit a report on 
          any subject to either house of the Legislature, a committee 
          or office of either house of the Legislature, or 
          Legislative Counsel must include a provision repealing or 
          making inoperative the operating requirement no later than 
          a date four years following the operative date of the bill 
          or four years after the date of any report required every 
          four or more years.  (Reports are due on different 
          schedules Ýe.g., two, three, four or even five and ten year 
          cycles].  This sunset requirement is intended to ensure 
          that a report due, for example, every five years will not 
          be repealed until four or more years after the due date in 
          order to provide ample time to effect obtaining the 
          information via budget or legislative means.)

          Existing law (Government Code Section 9795) provides that 
          any report required or requested by law to be submitted by 
          a state or local agency to the members of either house of 
          the Legislature must be submitted as a printed copy to 
          Legislative Counsel and the Secretary of the Senate and as 
          an "electronic copy" to the Chief Clerk of the Assembly.  
          The law also requires an agency to provide a one-page 
          electronic summary directly to each member of the 
          Legislature rather than a full copy now that reports are 
          available electronically.






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          Existing law, (AB 855 - Firebaugh, Chapter 820 of 2003), 
          established the Digital Divide Grant Program with a funding 
          mechanism of 15% of the proceeds from wireless 
          telecommunications facility leases of state property, 
          excluding Caltrans, that were entered into after January 1, 
          2004.  The law requires the California Public Utilities 
          Commission (PUC) to deposit the proceeds of these leases 
          into a Digital Divide Account of the California Teleconnect 
          Fund (CTF) to be used to finance digital divide projects. 

                                         
                                   BACKGROUND
           
           Purpose of SB 493:   The author's office points out that 
          last year, numerous California nonprofit organizations were 
          awarded ARRA broadband grants to help fund public computer 
          centers and digital literacy programs specifically aimed at 
          those populations least likely to have their own computers, 
          subscribe to Internet service, or have skills to navigate 
          "on-line." The purpose of these projects is to provide 
          public access to computers with Internet service at 
          libraries, workforce centers, parks and youth and family 
          centers in various locations throughout the state 
          especially for low-income and non-English speaking 
          communities.  The expectation is that such projects will 
          enable individuals without a personal computer to be able 
          to apply for jobs, get online training, access health care 
          and government services, or engage in the activities that 
          are now available only with Internet access.  Several of 
          the grant recipients are implementing these projects in 
          partnership with school districts.

          The author's office notes that DGS receives and disposes of 
          surplus computers no longer used by state agencies.  The 
          most recent auction of surplus personal property conducted 
          by DGS was in January of 2011.  That auction listed 
          hundreds of surplus state computers (including monitors and 
          printers) - the next auction is scheduled for May 2011.  

          DGS currently is required to make surplus state computers 
          available first to public schools prior to disposing of the 
          property at an auction.  The law also permits DGS to offer 
          the surplus computers to school districts for less than 
          fair market value provided it's in the state's best 
          interest.  The author's office claims that while this 
          requirement was aimed at giving students access to 




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          affordable computers to enhance digital literacy, very few 
          schools have chosen to obtain used computers from DGS.  The 
          ARRA broadband grantees, on the other hand, are currently 
          seeking low-cost computers so that they can provide 
          Internet access and digital literacy skills to as many 
          Californians as possible.

          The author's office emphasizes that access to high-speed 
          Internet connections - broadband - and basic digital 
          literacy skills are essential to virtually every aspect of 
          daily life in our 21st century digital economy.  California 
          has been a national leader in efforts to close the digital 
          divide and bring broadband to citizens from every 
          background and in all parts of the state.

           Arguments in Support:   Writing in support of SB 493 
          proponents state that, "A computer has been shown to have a 
          huge positive impact on a child's ability to do schoolwork, 
          an outof work adults ability to find a job, and everyones 
          ability to access online healthcare information. For so 
          many of Californias citizens to be unable to afford 
          computers, keeping them out of touch and unable to fully 
          participate in society, is a tremendous waste of human 
          resources. The state's surplus computer can help eliminate 
          this barrier to full citizenship at virtually no cost to 
          taxpayers." 

           Staff Comment:   SB 493 requires DGS to submit a report to 
          the Legislature no later than January 1, 2012.  This 
          relatively short reporting time-frame may not allow DGS 
          sufficient time to fully evaluate the program. Thus, the 
          author may wish to consider amending the reporting due date 
          to June 30, 2012 or even December 31, 2012. 

          As noted above, existing law  permits  DGS to offer surplus 
          personal computers to school districts for less than fair 
          market value.  SB 493 would, regardless of existing 
          provisions,  require  DGS to first offer surplus computers to 
          public computer centers and digital literacy programs for 
          less than fair market value if DGS determines it's in the 
          state's best interest.  Although this proposal is indeed a 
          noble one, due to the current state Budget crisis and all 
          the proposed cuts in funding to education and numerous 
          existing social programs, the state should be seeking to 
          maximize its return on surplus computers, monitors, 
          printers and the like.  Thus, the author may wish to 




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          consider amending this proposal to simply grant DGS the 
          authority to offer surplus computers to public computer 
          centers and digital literacy centers at less than fair 
          market value.  
                                         
                           PRIOR/RELATED LEGISLATION
           
           AB 1585 (Accountability & Administrative Review Committee) 
          Chapter 7, Statutes of 2010.   Among other things, deleted 
          hundreds of obsolete reports and revised the procedure for 
          mandatory reporting requirements by state agencies.
           

          SB 909 (Bowen) Chapter 870, Statutes of 2006.   Authorized 
          the PUC to expend up to
          $2 million of the unencumbered amount for the nonrecurring 
          installation costs of high-speed broadband services, as 
          defined, for community organizations that are eligible for 
          discounted rates pursuant to the teleconnect program.  

          SB 1645 (Mountjoy) Chapter 731, Statutes of 1998.   Among 
          other things, authorized DGS to first offer appropriate 
          surplus state personal property, at less than fair market 
          value, to school districts prior to offering that property 
          to the public, except for equipment more appropriately 
          suited for public safety uses.

           SUPPORT:   As of March 18, 2011:

          California State Library
          Computers for Youth
          ReliaTech
          The Stride Center
          Youth Policy Institute

           OPPOSE:   None on file as of March 18, 2011.
           
          FISCAL COMMITTEE:   Senate Appropriations Committee

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