BILL ANALYSIS �
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|Hearing Date:April 16, 2012 |Bill No:SB |
| |1424 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: SB 1424Author:Harman
As Introduced: February 24, 2012 Fiscal:Yes
SUBJECT: Professions and vocations: architects, professional
engineers, and land surveyors: contracting with state or local
agencies.
SUMMARY: Requires architects, engineers and land surveyors, when
competing to provide services to a public agency, to comply with the
law relating to entering into contracts based on demonstrated
competence and professional qualifications rather than competitive
bidding.
Existing law, the Business and Professions Code (BPC):
1)Licenses and regulates the practice of architecture under the
Architects Practice Act by the California Architects Board (CAB)
within the Department of Consumer Affairs (DCA).
a) Provides that CAB may take disciplinary action against an
architect for the commission of an act or omission that is
grounds for disciplinary action under the Architects Practice
Act. (BPC � 5560)
b) Provides that the fact that an architect is practicing in
violation of the Architects Practice Act is grounds for
disciplinary action. (BPC � 5578)
2)Licenses and regulates the practice of professional engineers under
the Professional Engineers Act, and land surveyors under the
Professional Land Surveyors Act by the Board for Professional
Engineers, Land Surveyors, and Geologists (BPELSG), within the DCA.
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a) Provides that BPELSG may take disciplinary action against an
engineer for a violation of any provision of the Professional
Engineers Act. (BPC � 6775)
b) Provides that BBELSG may take disciplinary action against a
land surveyor for any violation of any provision of the
Professional Land Surveyors Act or of any other law relating to
or involving the practice of land surveying. (BPC � 8780)
Existing law, the Government Code (GC):
1) Requires state and local agencies (public agencies) to enter into
contracts for architectural, landscape architectural, engineering,
environmental services, land surveying, or construction project
management services based on demonstrated competence and
professional qualifications rather than competitive bidding. (GC �
4526)
2)Requires public agencies to adopt procedures that prohibit unlawful
activity in the making of contracts for these services, including
rebates or kickbacks. (GC � 4526)
3)Requires that individuals or firms proposing to provide services
under these provisions provide evidence to the state or local agency
of their expertise and experience in the provision of these
services. (GC � 4529.5)
This bill:
1)Provides within the Architects Practice Act, that when competing to
provide architectural services to a public agency, an architect
shall comply with the law relating to entering into contracts based
on demonstrated competence and professional qualifications rather
than competitive bidding.
2)Provides within the Professional Engineers Act, that competing to
provide engineering services to a public agency, a professional
engineer shall comply with the law relating to entering into
contracts based on demonstrated competence and professional
qualifications rather than competitive bidding.
3)Provides within the Professional Land Surveyors Act, that when
competing to provide land surveying services to a public agency, a
professional land surveyor shall comply with the law relating to
entering into contracts based on demonstrated competence and
professional qualifications rather than competitive bidding.
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FISCAL EFFECT: Unknown. This bill has been keyed "fiscal" by
Legislative Counsel.
COMMENTS:
1.Purpose. This bill is sponsored by American Institute of Architects,
California Council (Sponsor) to add a clause in the Practice Acts of
architects, professional engineers, and land surveyors that they are
required to follow the Mini-Brooks Act (Government Code 4525 et
seq).
According to the Sponsor, the Mini-Brooks Act, requires a
Qualifications Based Selection (QBS) criteria which allows for a
process for selecting competing design professional firms according
to their qualifications for the project rather than price. If the
public agency and the design firm can reach an agreement that
includes a fair and reasonable price to the public agency, the two
parties can enter into a contract.
The Sponsor indicates that more public agencies are using price as a
selection criteria, asking for an estimate of cost before
qualifications and the scope of the project have been established,
with some coming very close to selecting design professionals using
a low-bid method of selection. Likewise, more design professionals
are engaging in competition practices that violate the QBS law
The Sponsor believes that the bill will allow architects, professional
engineers, and land surveyors to not be pressured into providing a
price before entering into negotiations that will determine the
level of services needed to design the project and meet the needs of
the public agency. This bill would make a violation of the
Mini-Brooks Act a violation of the design professional's licensure,
thus empowering the design professional to follow the intent of
existing California law, according to the Sponsor.
2.Background. The California Qualifications Based Selection (QBS)
statute, effective January 1, 1990, allows for a process designed to
rank competing design professional firms according to their
qualifications for the project. After ranking the competing firms,
the public agency negotiates with the top ranked firm on the scope
of services and fees. If the two parties can reach an agreement
that includes a price that is "fair and reasonable" to the public
agency, the two parties can enter into a contract.
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The Sponsor states that while the QBS statute is very clear that price
is a negotiation item, as opposed to a selection item, a 2000
statute enacted by the voters with the passage of Proposition 35
arguably allows public agencies to use price as a selection item.
This was not, according to the Sponsor, the intent of Proposition
35; nevertheless, it is being used to justify the use of price as a
selection criteria by some public agencies.
The reason for qualifications and competence being the ranking criteria
and price being a negotiated item is a recognition that the success
of a project depends on the quality of the work performed by the
design professional. Additionally, at the time for the Request for
Qualifications, there is nothing for the design professional to
competitively bid because full expectations of the project have not
been determined.
3.Qualifications Based Selection (QBS). QBS refers to a procurement
process established by the United States Congress as a part of the
federal Brooks Act (40 USC 1101 et. seq.) and further developed as a
process for public agencies to use for the selection of
architectural and engineering services for public construction
projects. It is a competitive contract procurement process whereby
consulting firms submit qualifications to a procuring entity (public
agency) who evaluates and selects the most qualified firm, and then
negotiates the project scope of work, schedule, budget, and fees.
A primary element under a QBS procurement is that the cost of the work
(price) is not considered when making the initial selection of the
best or most appropriate provider of the professional services
required. Fees for services will be negotiated, however, following
selection and before contracting.
Many states in the US have adopted their own versions of the Brooks
Act, commonly called a "Mini-Brooks Act."
The QBS process is intended for public agencies to select a qualified
and competent design professional for the project at a fair and
reasonable price to the public agency. For example, a local health
care district that is building a hospital should hire an architect
with experience and demonstrated competence in designing health care
facilities, and the state when building a bridge or dam should hire
a design team with experience and demonstrated competence in
designing bridges or dams, respectively. The QBS process is
intended to enable the design professionals to be selected based
upon their qualifications and experience rather based upon the
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lowest bid.
4.Proposition 35. In 2000, California voters enacted Proposition 35
which amended the California Constitution to allow the state and
local governments to contract with qualified private entities for
architectural and engineering services for all phases of a public
works project. Since 1934, governmental entities in California had
been allocated most public works architectural and engineering
contracts because courts interpreted the Constitution to give civil
servants a first right to these projects.
Since enacted, it has been argued that by requiring "a fair competitive
selection process" Proposition 35 limited public agencies to
choosing the lowest bidder, rather than using a qualifications-based
procedure. The Sponsor states that was not the intent of the
authors of Proposition 35; nevertheless, it is being used to justify
the use of price as a selection criteria by some public agencies.
5.Arguments in Support. The California Land Surveyors Association
(CLSA) states that the QBS bid/selection process initially ensures
that all design professionals are qualified for the project, and
that the price of the project is not considered until after the
selection and ranking of the qualified design professional.
Unfortunately, according to CLSA, many state and local agencies are
forcing design professionals to compete on the basis of price,
rather than on the basis of qualification for the specific project.
SB 1424 merely requires that design professionals (architects,
engineers, and land surveyors) comply with the existing provisions
of California's QBS statute contained in Government Code 4525 et
seq. If a design professional fails to comply with this existing
and well known body of California law, the architect, engineer, or
land surveyor would be subject to a disciplinary action from their
specific licensing board, according to CLSA.
6.Arguments in Opposition. Professional Engineers in California
Government (PECG) believes existing law provides sufficient clarity
with respect to how architects and engineers bid on services. PECG
does not believe any additional legislation is necessary. Further,
PECG believes that the qualification based selection system does not
provide the best deal to the taxpayer because cost is not the
primary rationale for awarding contracts. Anything governments can
do to inject cost as more of a subjective factor can only benefit
taxpayers, according to PECG.
7.Policy Issues . By explicitly stating within the respective licensing
acts for architects, engineers and land surveyors, that an
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architect, engineer or land surveyor must comply with the provisions
of the Government Code relating to entering into contracts based on
demonstrated competence and professional qualifications, rather than
competitive bidding, this bill shifts enforcement of the contract
process to the respective licensing boards. It is unclear whether
the California Architects Board or the Board for Professional
Engineers, Land Surveyors, and Geologists is capable of, or equipped
to enforce the law relating to contracting with public agencies.
In addition, the requirements that this bill would place upon
architects, engineers and land surveyors may be unclear. The bill
requires the architects, engineers and land surveyors to comply with
contracting law requirements placed upon public agencies
(specifically, Chapter 10 (commencing with Section 4525) of Division
5 of Title I of the Government Code). That law places requirements
upon state agencies and local agencies contracting for projects. It
is unclear how design professionals comply with mandates placed upon
public agencies.
SUPPORT AND OPPOSITION:
Support:
American Institute of Architects, California Council (Sponsor)
California Land Surveyors Association
Opposition:
Professional Engineers in California Government
Consultant:G. V. Ayers