BILL ANALYSIS Ó
SENATE PUBLIC EMPLOYMENT & RETIREMENT BILL NO: AB 906
Jim Beall, Chair HEARING DATE: June 24, 2013
AB 906 (Pan) as amended 5/24/13 FISCAL: YES
STATE CIVIL SERVICE: PERSONAL SERVICES CONTRACTS
HISTORY :
Sponsor: American Federation of State, County, and
Municipal Employees, AFL-CIO (AFSCME)
Other legislation:AB 334 (Gomez) 2013
Currently in Senate Appropriations Committee
AB 149 (Lara) 2011
Died in Senate Appropriations Committee
AB 556 (Conway) 2009
Died in Assembly Judiciary Committee
ASSEMBLY VOTES :
PER & SS 5-2 4/24/13
Appropriations 12-5 5/24/13
Assembly Floor 49-27 5/29/13
SUMMARY :
AB 906 provides that no state agency personal services
contracts of an emergency, urgent, temporary, or occasional
nature shall have a term greater than two years. The bill
prohibits all state agencies from executing any personal
service contracts, as specified, until the State Personal
Board (SPB) has contacted all organizations that represent
state employees who perform the type of work to be contracted
for an opportunity both to comment on the proposed contracts
and to request that SPB review the contracts for compliance
with statutory standards.
The bill also expands the kind of authorized counterparties
to a state agency personal services contract by adding
limited liability companies (LLCs) to the definition of a
"firm."
BACKGROUND AND ANALYSIS :
Glenn A. Miles
Date: June 15, 2013 Page
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1)Existing law :
a) requires that services provided by state agencies
generally be performed by state civil service employees,
but allows certain services to be provided through
personal service contracts if they meet statutorily
prescribed standards.
b) specifies cost savings criteria for personal service
contracts and defines standards under which state
agencies may execute personal service contracts,
including that the contracts may be used for emergency
appointments or for work of an urgent, temporary, or
occasional nature.
c) requires a state agency proposing to execute a
personal service contract to notify the State Personnel
Board (SPB) of its intention. Upon notification, SPB
must immediately contact all organizations that
represent state employees who perform the type of work
to be contracted and anyone who has filed a request to
be similarly noticed.
d) allows an employee organization, within 10 days of
receiving notice of a proposed contract, to request that
SPB review the contract for compliance with the
statutory standards.
e) existing law requires state agency personal service
contracts be with a "firm," which is defined as a
corporation, partnership, nonprofit organization, or
sole proprietorship but does not include limited
liability companies (LLCs).
1)This bill :
a) adds LLCs to the definition of a "firm" as an
authorized counterparty to a state agency's personal
services contract.
b) provides that no state agency personal services
contracts of an emergency, urgent, temporary, or
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Date: June 15, 2013 Page
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occasional nature, as specified, shall have a term
greater than two years.
c) prohibits any state agency from executing any
personal service contract, as specified, until the SPB
has contacted all organizations that represent state
employees who perform the type of work to be contracted
for an opportunity both to comment on the proposed
contracts and to request that SPB review the contracts
for compliance with statutory standards.
FISCAL :
According to the Assembly Appropriations Committee, AB 906
would result in "(s)ignificant state employment costs,
conservatively in the hundreds of thousands of dollars,
potentially in the tens of millions of dollars each year.
The bill targets personal service contracts that are
permissible under existing law only because the contracting
agency clearly demonstrates the proposed contract will result
in actual overall cost savings to the state."
COMMENTS :
1)Arguments in Support :
The sponsor states that "privatization contracts are often
unnecessary and violate state constitutional and statutory
prohibitions against overspending on service contracts. A
March 2009 study conducted by the Service Employees
International Union, Local 1000, found that the state could
save approximately $350 million annually by utilizing civil
service employees instead of unnecessary and wasteful
privatization contracts. This bill will provide the
increased transparency and oversight needed for those savings
to be realized."
2)Arguments in Opposition :
a) According to the California Disability Services
Association, contract programs that provide employment
to adults with developmental disabilities would be
negatively impacted "by delaying or halting the services
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all together while the State Personnel Board waits for
understaffed state agencies to explain why they are
using the contract services."
b) The California Commission on Peace Officer Standards
and Training (POST) states that "POST has over 5,600
certified training courses that are offered by over 800
presenters" to provide required instructional training
for peace officers and public safety dispatchers
throughout the state. "Only a limited number of state
employees meet the POST instructor qualifications to
present the training? AB 906 would eliminate POST's
ability to deliver critical training needed by the law
enforcement community."
3)SUPPORT :
American Federation of State, County, and Municipal
Employees (AFSCME), AFL-CIO, Sponsor
AFSCME, Local 2620, AFL-CIO
California Attorneys, Administrative Law Judges and Hearing
Officers in State Employment (CASE)
California Correctional Peace Officers Association (CCPOA)
Professional Engineers in California Government (PECG)
Service Employees International Union (SEIU), Local 1000
Union of American Physicians and Dentists
(UAPD)/AFSCME-Local 206
4)OPPOSITION :
California Chamber of Commerce
California Commission on Peace Officer Standards and
Training (POST), Oppose Unless Amended
California Disability Services Association
Natoma Technologies, Inc. (Natoma)
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