BILL ANALYSIS �
AB 906
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Date of Hearing: April 24, 2013
ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL
SECURITY
Rob Bonta, Chair
AB 906 (Pan) - As Amended: April 18, 2013
SUBJECT : Personal services contracts: independent contractors.
SUMMARY : Prohibits the term of a personal services contract
from exceeding two years, as specified, and requires
notification of the affected state employee organizations when a
contract is proposed to be renewed or extended. Employee
organization may request to meet and confer over the issue prior
to the extension or renewal.
EXISTING LAW :
1)Requires, based on provisions in the California Constitution,
that services provided by state agencies generally be
performed by state civil service employees.
2)Requires that proposals for contracting must, at a minimum,
meet the following criteria:
a) Contracts must result in cost savings to the state.
b) Contractors' wages are at the industry's level and do
not significantly under-cut state pay rates.
c) Contracts cannot cause the displacement of civil service
employees.
d) Contracts cannot adversely affect the state's
affirmative action efforts.
e) Contract savings must be large enough to ensure that the
savings will not be eliminated by cost fluctuations that
could normally be expected during the contract period
f) Contract savings clearly justify the size and duration
of the contract
g) The contract is awarded through a publicized,
competitive bidding procedure
h) The contract includes specific provisions pertaining to
the qualifications of the staff who will perform the work.
FISCAL EFFECT : Unknown
COMMENTS : According to the author, "Under existing law, state
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agencies and departments are undermining the Legislature's
appropriation authority and the state civil service system by
abusing their ability to enter into personal services contracts.
The Department of General Services charged with reviewing and
approving state departments' requests to contract out personal
services. Unfortunately, DGS is failing to thoroughly review
request to ensure the request makes good business sense and the
cost is reasonable."
"According to the Assembly Budget Subcommittee 4 Agenda for its
February 21, 2012 hearing, the state currently has over 14,000
personal service contracts worth $11.8 billion. These
expenditures occur with no substantive legislative oversight."
The author concludes that AB 906 is a first step in ensuring
that state agencies and departments are working in conjunction
with the Legislature to build and maintain a strong civil
service system, as envisioned in the State Constitution.
The Committee is informed that the author will be offering
amendments in Committee that delete the provision that requires
notification of the affected state employee organizations when a
contract is proposed to be renewed or extended and allows the
employee organization to request to meet and confer over the
issue. It was the author's intent that this provision be
deleted in the April 18, 2013 amendments to the bill but it was
inadvertently retained.
REGISTERED SUPPORT / OPPOSITION :
Support
American Federation of State, County and Municipal Employees
(Sponsor)
American Federation of State, County, and Municipal Employees
Local 2620
Opposition
Brea Chamber of Commerce (letter dated 4/11/13)
California Chamber of Commerce (letter dated 4/22/13)
Natoma Technologies, Inc. (letter dated 4/12/13)
Technology Association of America (letter dated 4/18/13)
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
AB 906
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