BILL NUMBER: SB 1280 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 2, 2012
AMENDED IN SENATE APRIL 18, 2012
INTRODUCED BY Senator Pavley
FEBRUARY 23, 2012
An act to add and repeal Sections 10507.8 and 20651.7 of the
Public Contract Code, relating to public contracts.
LEGISLATIVE COUNSEL'S DIGEST
SB 1280, as amended, Pavley. Public contracts: University of
California and community college districts: competitive bidding: best
value.
Existing law requires the Regents of the University of California,
except as provided, to let all contracts involving an expenditure of
more than $100,000 annually for goods and materials or services to
the lowest responsible bidder meeting certain specifications, or to
reject all bids. Existing law requires the governing board of any
community college district to let specified contracts involving an
expenditure of more than $50,000 to the lowest responsible bidder
meeting certain specifications, or else to reject all bids.
This bill would provide that before January 1, 2018, the bid
evaluation and selection for these contracts may be determined by the
best value for the University of California or community college
district, as specified.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 10507.8 is added to the Public Contract Code,
to read:
10507.8. (a) As provided for in this article, when the University
of California determines that it can expect long-term savings
through the use of life-cycle cost methodology, the use of more
sustainable goods and materials, and reduced administrative costs,
the lowest responsible bidder may be selected on the basis of the
best value to the university. In order to implement this method of
selection, the Regents of the University of California shall adopt
and publish policies and guidelines for evaluating bidders that
ensure that best value selections by the university are conducted in
a fair and impartial manner. These policies and guidelines shall
conform to the requirements of subdivisions (c) and (d) and shall be
applicable to the university when using best value as the bid
evaluation methodology.
(b) For the purposes of this section, the following definitions
apply:
(1) "Best value" means the most advantageous balance of price,
quality, service, performance, and other elements, as defined by the
university, achieved through methods in accordance with this section
and determined by objective performance criteria that may
include price, features, long-term functionality, life-cycle costs,
overall sustainability, and required services .
(2) "Best value agreement" means an agreement entered into
pursuant to the provisions of this section.
(3) "Best value awardee" means the lowest responsible bidder or
bidders who that are awarded an
agreement for goods, materials, or services that was awarded through
the use of best value for the bid evaluation methodology.
(4) "University" means all campuses of the University of
California, including the medical centers, the national laboratories,
and any future University of California locations.
(c) (1) The university shall consider all of the following when
adopting policies and guidelines pursuant to subdivision (a):
(A) Price and service proposals that reduce the university's
overall operating costs.
(B) Supply and material standards that support the university's
strategic sourcing initiatives.
(C) A procedure for bid protest and resolution.
(2) The university shall award a best value agreement as follows:
(A) The university shall evaluate bidders based solely upon the
criteria set forth in the solicitation documents. Solicitation for
bids shall describe the criteria that the university will consider in
evaluating the bidders by overall category and by specific
attributes.
(B) The university shall award the agreement to the lowest
responsible bidder or bidders whose bid or bids are determined
by the university to be the best value in terms of price, quality,
service, and performance, and that meet the university's
requirements.
(C) Bid participants that are not awarded a best value agreement
shall be notified in writing at the end of the agreement award
process.
(d) For the purposes of this section, the university may take into
consideration any of the following factors if awarding a best value
agreement for goods, materials, and services:
(1) The total cost to the university of its use or consumption of
goods, materials, and services.
(2) The operational cost or benefit incurred by the university as
a result of a contract award.
(3) The added value to the university, as defined in the request
for proposal, of vendor-added services.
(4) The quality and effectiveness of goods, materials, and
services.
(5) The use of more sustainable goods and materials in the
manufacturing of the goods and materials and the packaging of these
products.
(6) The reliability and timeliness of delivery and installation.
(7) The terms and conditions of product warranties, maintenance,
and vendor guarantees.
(8) The vendor's quality assurance, continuous improvement, and
business resumption programs and their benefit to the university.
(9) The vendor's experience with the timely provision of goods,
materials, and services.
(10) The consistency of quality and availability of the vendor's
proposed supplies, materials, and services with the university's
overall procurement program.
(11) The economic benefits to the local community, including, but
not limited to, job creation or retention and the support of small
and local businesses.
(e) The university shall ensure that all businesses have a fair
and equitable opportunity to compete for, and participate in, the
university best value bids and shall also ensure that discrimination
in the award and performance of the agreement does not occur on the
basis of gender, marital status, ancestry, medical condition, or any
characteristic listed or defined in Section 11135 of the Government
Code, or retaliation for having filed a discrimination complaint or
protest in the performance of university contractual obligations.
(f) (1) On or before July 1, 2016, the University of California
shall collect and provide the following information to the
Legislative Analyst's Office:
(A) The total number of contracts awarded by the University of
California involving an expenditure of more than one hundred thousand
dollars ($100,000) annually for goods and materials to the lowest
responsible bidder and the number of contracts awarded using best
value.
(B) A description of the products, commodities, or services
resulting from the best value agreements awarded pursuant to this
section.
(C) The name of the best value awardee or awardees of the
agreement or agreements.
(D) The criteria used to evaluate the bids.
(E) The actual volume resulting from the agreements, or estimated
volume if the best value agreements are less than one year old, of
all purchases.
(F) A summary of the rationale for the awarding of the best value
agreement.
(G) A description of any written bid protest or protests
concerning an aspect of the solicitation, bid, or award of the best
value agreement including the resolution of the protest.
(H) The policies and procedures adopted pursuant to subdivision
(a).
(I) A summary of any noncost value obtained through best
value agreements additional economic benefit other
than the price of the contract obtained through contracts
let under the best value acquisition policies .
(J) The university shall provide an accounting of the contracts
awarded under best value procurement pursuant to this section as
compared to comparable contracts awarded pursuant to the traditional
lowest responsible bidder process, including, but not limited to,
contracts awarded prior to the adoption of the best value acquisition
policies.
(2) The Legislative Analyst shall request the University
of California to provide the information specified in paragraph (1)
to the Legislative Analyst on or before November 1, 2016.
On or before February 1, 2017, the Legislative Analyst shall report
to the Legislature on the use of best value procurement by the
University of California. The Legislative Analyst shall use the
information provided by the university to report all of the
following:
(A) A summary of the overall benefits of best value acquisition.
(B) A summary of any disputes arising from the use of best value
procurement practices and the resolution and status of those
disputes.
(C) A summary of overall performance criteria used to evaluate the
bids and the effectiveness of the methodology.
(D) A summary of noncost value any
additional economic benefit other than the price of the contract
obtained through contracts let under the best value acquisition
policies reported by the university.
(E) A general summary and evaluation of university policies
adopted pursuant to subdivision (a).
(F) Recommendations as to whether the best value at lowest cost
acquisition procurement authority should be continued.
(G) A comparison of the overall cost of contracts let under best
value acquisition pursuant to this section to similar contracts let
under traditional low bid procurement practices.
(g) This section applies solely to the procurement of goods,
materials, or services and shall not apply to construction contracts.
(h) This section shall remain in effect only until January 1,
2018, and as of that date is repealed.
SEC. 2. Section 20651.7 is added to the Public Contract Code, to
read:
20651.7. (a) For the purposes of bid evaluation and selection
pursuant to subdivision (a) of Section 20651, when a community
college district determines that it can expect long-term savings
through the use of objective performance criteria other than
price, the community college district may provide for selection
based on competitive means for obtaining life-cycle
cost methodology, the use of more sustainable goods and materials,
and reduced administrative costs, the community college district may
provide for the selection of the lowest responsible bidder on the
basis of best value pursuant to policies and procedures adopted
by the governing board in accordance with this section.
(b) For purposes of this section , "best value" means
a value the most advantageous balance of
price, quality, service, performance, and other elements, as defined
by the governing board, achieved through methods in accordance with
this section and determined by objective performance criteria
that may include , but need not be limited to,
price, features, long-term functionality, life-cycle costs, overall
sustainability, and required services to make
operational for the community college and other criteria deemed
appropriate by the community college district .
(c) A community college district shall consider all of the
following if adopting best value policies pursuant to subdivision
(a):
(1) Price and service level proposals that reduce the district's
overall operating costs, including end-of-life expenditures and
impact.
(2) Equipment, services, supplies, and materials standards that
support the community college district's strategic acquisition and
management program direction.
(3) A procedure for protest and resolution.
(d) A community college district may consider any of the following
factors if adopting policies and procedures pursuant to subdivision
(c):
(1) The total cost to the community college district of its
purchase, use, and consumption of equipment, supplies, and materials.
(2) The operational cost or benefit incurred by the community
college district as a result of a contract award.
(3) The added value to the community college district, as defined
in the request for proposal, of vendor-added services.
(4) The quality and effectiveness of equipment, supplies,
materials, and services.
(5) The reliability of delivery and installation schedules.
(6) The terms and conditions of product warranties and vendor
guarantees.
(7) The financial stability of the vendor.
(8) The vendor's quality assurance program.
(9) The vendor's experience with the provisions of equipment,
supplies, materials, and services within the institutional
marketplace.
(10) The consistency of the vendor's proposed equipment, supplies,
materials, and services with the district's overall supplies and
materials procurement program.
(11) The economic benefits to the local community, including, but
not limited to, job creation and retention.
(12) The environmental benefits to the local community.
(e) A community college district awarding a contract under
this section shall award a contract to the lowest
responsible bidder whose proposal is determined, in writing by the
community college district, to be the best value to the community
college district based solely on the criteria set forth in the
request for proposal.
(f) The governing board of a community college district shall
issue a written notice of intent to award supporting its contract
award and stating in detail the basis of the award. The notice of the
intent to award and the contract file must be sufficient to satisfy
an external audit.
(g) The governing board of a community college district shall
publicly announce its award, identifying the bidder to whom
which the award is made, the price proposal of
the contractor awarded the contract, and the overall combined rating
on the request for proposal evaluation factors. The announcement
shall also include the ranking of the contractor awarded the contract
in relation to all other responsive bidders and their respective
price proposals and summary of the rationale for the contract award.
(h) The community college district shall ensure that all
businesses have a fair and equitable opportunity to compete for, and
participate in, district contracts and shall also ensure that
discrimination, as described in subdivision (e) of Section 12751.3 of
the Public Utilities Code, in the award and performance of contracts
does not occur.
(i) (1) If a community college district elects to purchase
equipment, materials, supplies, and services by contract, let in
accordance with this section, the community college district shall
submit the following information to the Chancellor of the California
Community Colleges on or before January 1, 2016:
(A) The total number of district procurements for contracts and
the number that were done under best value acquisition policies.
(B) For a contract awarded under the best value acquisition
policies, the bid announcement announcing the bidder to whom
which the award was made, including that bidder'
s scoring rating compared to other bidders, the winning contractor's
price proposal, the overall combined rating on the request for
proposal evaluation factors, and a summary of the rationale for the
contract award.
(C) The bid award announcement specifying to whom
which the contract was awarded, and the amount
of the award for any comparably sized contract, to the best value
contract being let, awarded pursuant to the traditional lowest
responsible bidder process in the three years prior to the adoption
of best value acquisition policies.
(D) The nature of any disputes arising from the use of best value
procurement practices and the status of those disputes.
(E) The community college district's policies adopted pursuant to
subdivision (a).
(F) A summary of any additional economic benefit other than the
price of the contract obtained through contracts let under the best
value acquisition policies.
(2) The Legislative Analyst shall request the chancellor to
provide the information specified in paragraph (1) to the Legislative
Analyst on or before July 1, 2016. On or before January 1, 2017, the
Legislative Analyst shall report to the Legislature on the use of
competitive means for obtaining best value procurement by community
college districts. The Legislative Analyst shall use the information
provided by the chancellor to report all of the following:
(A) A summary of the overall benefits of best value acquisition.
(B) A comparison of the overall cost of contracts let under
best value acquisition pursuant to this section to
similar contracts let under traditional low bid procurement
practices.
(C) A summary of any disputes arising from the use of best value
procurement practices and the resolution and status of those
disputes.
(D) A summary of overall performance criteria used to evaluate the
bids and the effectiveness of the methodology.
(E) A summary of soft cost value any
additional economic benefit other than the price of the contract
obtained through contracts let under the best value acquisition
policies reported by the community college district.
(F) A general summary and evaluation of the community college
district's policies adopted pursuant to subdivision (a).
(G) Recommendations as to whether the best value at lowest cost
acquisition procurement authority should be continued.
(j) This section shall remain in effect only until January 1,
2018, and as of that date is repealed.