California Legislature—2013–14 Regular Session

Assembly BillNo. 2272


Introduced by Assembly Member Gray

February 21, 2014


An act to amend Section 1720 of the Labor Code, relating to public works.

LEGISLATIVE COUNSEL’S DIGEST

AB 2272, as introduced, Gray. Public works: prevailing wage.

Existing law defines the term “public works” for purposes of requirements regarding the payment of prevailing wages. Existing law generally defines “public works” to include construction, alteration, demolition, installation, or repair work done under contract and paid for in whole or in part out of public funds. Existing law makes a willful violation of laws relating to the payment of prevailing wages on public works a misdemeanor.

Existing law establishes the California Advanced Services Fund (CASF) and requires the Public Utilities Commission to administer a program using moneys in the fund to encourage deployment of high-quality advanced communication services to all Californians by providing funding for infrastructure projects to provide broadband access to households that are unserved or underserved, as specified.

This bill would revise the definition of “public works” to also include projects funded by the California Advanced Services Fund. By expanding the definition of a crime, this bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

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SECTION 1.  

Section 1720 of the Labor Code is amended to
2read:

3

1720.  

(a) As used in this chapter, “public works” means:

4(1) Construction, alteration, demolition, installation, or repair
5work done under contract and paid for in whole or in part out of
6public funds, except work done directly by any public utility
7company pursuant to order of the Public Utilities Commission or
8other public authority. For purposes of this paragraph,
9“construction” includes work performed during the design and
10preconstruction phases of construction, including, but not limited
11to, inspection and land surveying work. For purposes of this
12paragraph, “installation” includes, but is not limited to, the
13assembly and disassembly of freestanding and affixed modular
14office systems.

15(2) Work done for irrigation, utility, reclamation, and
16improvement districts, and other districts of this type. “Public
17work” does not include the operation of the irrigation or drainage
18system of any irrigation or reclamation district, except as used in
19Section 1778 relating to retaining wages.

20(3) Street, sewer, or other improvement work done under the
21direction and supervision or by the authority of any officer or
22public body of the state, or of any political subdivision or district
23thereof, whether the political subdivision or district operates under
24a freeholder’s charter or not.

25(4) The laying of carpet done under a building lease-maintenance
26contract and paid for out of public funds.

27(5) The laying of carpet in a public building done under contract
28and paid for in whole or in part out of public funds.

29(6) Public transportation demonstration projects authorized
30pursuant to Section 143 of the Streets and Highways Code.

begin insert

31(7) California Advanced Services Fund projects pursuant to
32Section 281 of the Public Utilities Code.

end insert

P3    1(b) For purposes of this section, “paid for in whole or in part
2out of public funds” means all of the following:

3(1) The payment of money or the equivalent of money by the
4state or political subdivision directly to or on behalf of the public
5works contractor, subcontractor, or developer.

6(2) Performance of construction work by the state or political
7subdivision in execution of the project.

8(3) Transfer by the state or political subdivision of an asset of
9value for less than fair market price.

10(4) Fees, costs, rents, insurance or bond premiums, loans, interest
11rates, or other obligations that would normally be required in the
12execution of the contract, that are paid, reduced, charged at less
13than fair market value, waived, or forgiven by the state or political
14subdivision.

15(5) Money loaned by the state or political subdivision that is to
16be repaid on a contingent basis.

17(6) Credits that are applied by the state or political subdivision
18against repayment obligations to the state or political subdivision.

19(c) Notwithstanding subdivision (b):

20(1) Private residential projects built on private property are not
21subject to the requirements of this chapter unless the projects are
22built pursuant to an agreement with a state agency, redevelopment
23agency, or local public housing authority.

24(2) If the state or a political subdivision requires a private
25developer to perform construction, alteration, demolition,
26installation, or repair work on a public work of improvement as a
27condition of regulatory approval of an otherwise private
28development project, and the state or political subdivision
29contributes no more money, or the equivalent of money, to the
30overall project than is required to perform this public improvement
31work, and the state or political subdivision maintains no proprietary
32interest in the overall project, then only the public improvement
33work shall thereby become subject to this chapter.

34(3) If the state or a political subdivision reimburses a private
35developer for costs that would normally be borne by the public,
36or provides directly or indirectly a public subsidy to a private
37development project that is de minimis in the context of the project,
38an otherwise private development project shall not thereby become
39subject to the requirements of this chapter.

P4    1(4) The construction or rehabilitation of affordable housing units
2for low- or moderate-income persons pursuant to paragraph (5) or
3(7) of subdivision (e) of Section 33334.2 of the Health and Safety
4Code that are paid for solely with moneys from the Low and
5Moderate Income Housing Fund established pursuant to Section
633334.3 of the Health and Safety Code or that are paid for by a
7combination of private funds and funds available pursuant to
8Section 33334.2 or 33334.3 of the Health and Safety Code do not
9constitute a project that is paid for in whole or in part out of public
10funds.

11(5) “Paid for in whole or in part out of public funds” does not
12include tax credits provided pursuant to Section 17053.49 or 23649
13of the Revenue and Taxation Code.

14(6) Unless otherwise required by a public funding program, the
15construction or rehabilitation of privately owned residential projects
16is not subject to the requirements of this chapter if one or more of
17the following conditions are met:

18(A) The project is a self-help housing project in which no fewer
19than 500 hours of construction work associated with the homes
20are to be performed by the home buyers.

21(B) The project consists of rehabilitation or expansion work
22associated with a facility operated on a not-for-profit basis as
23 temporary or transitional housing for homeless persons with a total
24project cost of less than twenty-five thousand dollars ($25,000).

25(C) Assistance is provided to a household as either mortgage
26assistance, downpayment assistance, or for the rehabilitation of a
27single-family home.

28(D) The project consists of new construction, expansion, or
29rehabilitation work associated with a facility developed by a
30nonprofit organization to be operated on a not-for-profit basis to
31provide emergency or transitional shelter and ancillary services
32and assistance to homeless adults and children. The nonprofit
33organization operating the project shall provide, at no profit, not
34less than 50 percent of the total project cost from nonpublic
35sources, excluding real property that is transferred or leased. Total
36project cost includes the value of donated labor, materials,
37architectural, and engineering services.

38(E) The public participation in the project that would otherwise
39meet the criteria of subdivision (b) is public funding in the form
40of below-market interest rate loans for a project in which
P5    1occupancy of at least 40 percent of the units is restricted for at
2least 20 years, by deed or regulatory agreement, to individuals or
3families earning no more than 80 percent of the area median
4income.

5(d) Notwithstanding any provision of this section to the contrary,
6the following projects shall not, solely by reason of this section,
7be subject to the requirements of this chapter:

8(1) Qualified residential rental projects, as defined by Section
9142(d) of the Internal Revenue Code, financed in whole or in part
10through the issuance of bonds that receive allocation of a portion
11of the state ceiling pursuant to Chapter 11.8 of Division 1
12(commencing with Section 8869.80) of the Government Code on
13or before December 31, 2003.

14(2) Single-family residential projects financed in whole or in
15part through the issuance of qualified mortgage revenue bonds or
16qualified veterans’ mortgage bonds, as defined by Section 143 of
17the Internal Revenue Code, or with mortgage credit certificates
18under a Qualified Mortgage Credit Certificate Program, as defined
19by Section 25 of the Internal Revenue Code, that receive allocation
20of a portion of the state ceiling pursuant to Chapter 11.8 of Division
211 (commencing with Section 8869.80) of the Government Code
22on or before December 31, 2003.

23(3) Low-income housing projects that are allocated federal or
24state low-income housing tax credits pursuant to Section 42 of the
25Internal Revenue Code, Chapter 3.6 of Division 31 (commencing
26with Section 50199.4) of the Health and Safety Code, or Section
2712206, 17058, or 23610.5 of the Revenue and Taxation Code, on
28or before December 31, 2003.

29(e) If a statute, other than this section, or a regulation, other than
30a regulation adopted pursuant to this section, or an ordinance or a
31contract applies this chapter to a project, the exclusions set forth
32in subdivision (d) do not apply to that project.

33(f) For purposes of this section, references to the Internal
34Revenue Code mean the Internal Revenue Code of 1986, as
35amended, and include the corresponding predecessor sections of
36the Internal Revenue Code of 1954, as amended.

37(g) The amendments made to this section by either Chapter 938
38of the Statutes of 2001 or the act adding this subdivision shall not
39be construed to preempt local ordinances requiring the payment
40of prevailing wages on housing projects.

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SEC. 2.  

No reimbursement is required by this act pursuant to
2Section 6 of Article XIII B of the California Constitution because
3the only costs that may be incurred by a local agency or school
4district will be incurred because this act creates a new crime or
5infraction, eliminates a crime or infraction, or changes the penalty
6for a crime or infraction, within the meaning of Section 17556 of
7the Government Code, or changes the definition of a crime within
8the meaning of Section 6 of Article XIII B of the California
9Constitution.



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