BILL ANALYSIS �
SENATE PUBLIC EMPLOYMENT & RETIREMENT BILL NO: AB 906
Jim Beall, Chair HEARING DATE: July 8, 2013
AB 906 (Pan) as amended 7/3/13 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 on the Senate Floor
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 exempts certain contracts
relating to peace officer training and opportunities for the
developmentally disabled, as specified, from these
requirements.
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
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"firm."
BACKGROUND AND ANALYSIS :
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) requires state agency personal service contracts to
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.
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b) provides that no state agency personal services
contracts of an emergency, urgent, temporary, or
occasional nature, as specified, shall have a term
greater than two years. Exempts from this limitation
those personal service contracts developed to provide,
as specified, occupational opportunities to
developmentally disabled persons.
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.
d) creates a specific category of permissible personal
service contracts for services of an irregular,
unpredictable, or occasional duration that are necessary
to carry out instructional training by the Commission on
Peace Officer Standards and Training (POST).
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.
COMMENTS :
1)Argument 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
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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)Argument in Opposition :
According to the California Chamber of Commerce, the "time
restrictions on personal services contracts under AB 906 will
deter any private companies from bidding on these contracts,
as the cost of proposing a bid may be too high for the
limited contract available."
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 :
Association of Regional Center Agencies (ARCA)
California Chamber of Commerce
Natoma Technologies, Inc. (Natoma)
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