BILL ANALYSIS �
SENATE COMMITTEE ON EDUCATION
Carol Liu, Chair
2013-2014 Regular Session
BILL NO: AB 173
AUTHOR: Weber
AMENDED: May 23, 2013
FISCAL COMM: Yes HEARING DATE: June 19, 2013
URGENCY: No CONSULTANT:Kathleen Chavira
NOTE: This bill has been referred to both the Senate
Education and the Senate Governmental Organization
Committees. A do pass motion should include a referral to
the Senate Governmental Organization Committee.
SUBJECT : Small Business Procurement and Contract Act.
SUMMARY
This bill authorizes the California Community Colleges, the
California State University and the University of
California to award a contract with a value greater than
$5000 but less than $250,000 for the acquisition of goods,
services or information technology without competitive
bidding, to a certified small business or a disabled
veteran business, if the institution receives a price quote
from two or more of these entities, as specified.
BACKGROUND
Current law requires a community college governing board to
let any contract involving an expenditure of $50,000 or
more for purchase of equipment, materials, supplies,
repairs and services, other than construction services, to
the lowest responsible bidder or to reject all bids.
Current law also requires the Board of Governors of the
California Community Colleges to annually adjust the
$50,000 threshold to reflect the percentage change in the
annual average value of the Implicit Price Deflator for
State and Local Government Purchases of Goods and Services
for the United States. (Public Contract Code � 20651)
Current law requires the CSU trustees to prescribe policies
and procedures for the acquisition of services, facilities,
materials, goods, supplies, or equipment, and requires that
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these include competitive means for obtaining best value
while complying with legislative intent regarding
competitive bids or proposals as it is expressed in Public
Contract Code (PCC) provisions. Under the PCC, , all
contracts for the acquisition or lease of goods in an
amount of $25,000, or a higher amount as established by the
director of General Services, are required to use
competitive bidding. The Department of General Service has
set the threshold amount for competitive bidding for these
contracts at $50,000. (Education Code � 89036, PCC �10301)
Current law also requires that the Regents of the
University of California (UC) let any contract involving an
expenditure of $100,000 or more for purchase of equipment,
materials, supplies, repairs and services, other than
construction services, to the lowest responsible bidder or
to reject all bids. (PCC � 10507.7)
Current law, notwithstanding existing Government Code and
Public Contract Code provisions outlining competitive
bidding requirements, authorize a state agency to award a
contract for the acquisition of goods, services, or
information technology that has an estimated value of
greater than five thousand dollars ($5,000), but less than
two hundred fifty thousand dollars ($250,000), to a
certified small business, including a microbusiness, or to
a disabled veteran business enterprise, as long as the
agency obtains price quotations from two or more certified
small businesses, including microbusinesses, or from two or
more disabled veterans business enterprises. (Government
Code �14838.5)
ANALYSIS
This bill :
1) Establishes parallel authorities regarding the
awarding of contracts or the acquisition of goods,
services, or information technology to certified small
businesses or disabled veteran businesses for
California Community College districts, the California
State University (CSU) and the University of
California (UC), as that which exists for state
agencies. More specifically it:
a) Authorizes the CSU, UC, and the
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governing board of a community college district
to award a contract with an estimated value
greater than $5000 but less than $250,000 to a
certified small business, including a
microbusiness, or to a disabled veteran business
enterprise, as long as the agency obtains price
quotations from two or more certified small
businesses, including microbusinesses, or from
two or more disabled veterans business
enterprises.
b) Requires the CSU, UC, and the
governing board of a community college district
to consider a responsive timely received offer
from a responsible certified small business,
including a microbusiness, or from a disabled
veteran business enterprise.
2) Provides that these provisions only apply to the UC to
the extent the Regents adopt a resolution making it
applicable.
3) Defines the terms of the bill's provisions by
reference to existing Government Code provisions that
define, among other things, "small business,"
"microbusiness," and "disabled veteran business
enterprise."
STAFF COMMENTS
1) Need for the bill . According to the author, the
Government Code provides a streamline alternative
contracting process for state agencies contracting
with California Certified Small Business and Disable
Veteran Business Enterprises. By extending these
permissive authorities to California's public higher
education segments, universities and colleges can
continue to support procurement through businesses
which are crucial to the state's international
competitiveness and important to providing diversity.
2) Competitive bidding . Current law establishes
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thresholds above which the public institutions of
higher education must generally utilize statutorily
outlined competitive bidding procedures before
awarding a contract for goods and services or for
information technology services. These thresholds are
currently statutorily set at $100,000 for the
University of California, and $50,000 for the
California State University and California Community
College (CCC) districts. Current law requires the
adjustment of the CCC threshold to reflect the
percentage change in the annual average value of the
Implicit Price Deflator. As a result the actual
current threshold for community colleges is $81,000.
SUPPORT
California Asian Pacific Chamber of Commerce
OPPOSITION
None on file.