BILL NUMBER: AB 2490 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 24, 2014
AMENDED IN ASSEMBLY MARCH 28, 2014
INTRODUCED BY Assembly Member Eggman
FEBRUARY 21, 2014
An act to amend Sections 3954, 3960, 3965, 3965.1, and
4051.2 of, and 4051.2, and 4057 of, to repeal
Section 4053 of, and to repeal and add Section 4051 of,
the Food and Agricultural Code, to amend Section 13332.09 of the
Government Code, and to repeal Section
Sections 10320 and 10321 of the Public Contract
Code, relating to district agricultural associations.
LEGISLATIVE COUNSEL'S DIGEST
AB 2490, as amended, Eggman. District agricultural associations.
Existing
(1) Existing law divides the
state into agricultural districts, and provides for the management of
these districts by district agricultural associations. Existing law
provides for a board of directors for each district agricultural
association, and provides for the appointment of each director by the
Governor. Existing law sets forth the duties and responsibilities of
the board of directors and the district agricultural associations,
including that a district agricultural association requires
the approval of the Department of Food and Agriculture prior to
entering into a settlement agreement for an amount greater than
$10,000. and requires a district agricultural
association to take certain actions only with the ap
proval of the Department of Food and Agriculture or the Department of
General Services, or both.
This bill would authorize the Governor to remove any director of a
district agricultural association for cause prior to the expiration
of the director's term. The bill would revise the oversight
responsibilities of the Department of Food and Agriculture and the
Department of General Services by allowing a district
agricultural association to enter into settlement agreements for less
than $100,000 without the prior approval of the Department of Food
and Agriculture and by deleting the requirements that a district
agricultural association obtain approval of the Department of Food
and Agriculture or the Department of General Services prior to
exercising the power to sue, or contracting or exercising powers over
its own real or personal property. in connection with
district agricultural associations by deleting the requirement that
a district agricultural association obtain approval of the Department
of Food and Agriculture or the Department of General Services prior
to exercising certain powers, including the power to sue, entering
into a settlement agreement for less than $100,000, or contracting or
exercising certain powers over its own real or personal property.
The bill would require a district agricultural association to comply
with specified contracting procedures, including, among others,
soliciting bids in writing if the cost of a project exceeds $25,000.
The bill would authorize the board of directors of a district
agricultural association, with the approval of the Department of
General Services, to purchase, acquire, hold, sell, exchange, or
convey any interest in real property. The bill would require a
district agricultural association to adopt a fiscal review policy
that would provide for annual audits, as s pecified.
Existing
(2) Existing law requires the
Department of General Services to exercise oversight of the
acquisition and replacement of motor vehicles and other mobile
property by a state agency. Existing law defines "state agency" for
purposes of those provisions.
This bill would exclude district agricultural associations from
the definition of "state agency" for purposes of those provisions.
Existing
(3) Existing law requires the
Department of General Services to annually prepare a delegation
program for district agricultural associations, to be administered by
the Department of Food and Agriculture and the Department of General
Services. Existing law also requires the Department of Food and
Agriculture, for district agricultural associations and other fairs,
to develop criteria to be applied for purchases made locally at a
price equal to or lower than the price available through the state
purchasing program.
This bill would repeal those provisions.
This
(4) This bill would make
other related changes conforming and
nonsubstantive changes.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 3954 of the Food and Agricultural Code is
amended to read:
3954. Each association by its name has perpetual succession. It
may have a seal. An association may sue and be sued, and may do any
and all things necessary to carry out the powers and the objects and
purposes for which the association is formed.
SEC. 2. Section 3960 of the Food and Agricultural Code is amended
to read:
3960. The term of office of each director, except that of a
member of the first board, is four years from the beginning of the
term for which he or she is appointed. Any vacancy shall be filled
for the unexpired term. However, any director may be removed for
cause by the Governor prior to the expiration of the director's term.
SEC. 3. Section 3965 of the Food and Agricultural Code is amended
to read:
3965. The board may, with the approval of the department:
(a) Fix the term of office, the amount of bond, salary, and
prescribe the duties of the secretary and of the treasurer.
(b) Manage the affairs of the association.
(c) Make all necessary bylaws, rules, and regulations for the
government of the association.
(d) Delegate, as it may deem advisable, to its officers or
employees any of the powers that are vested in the board under
subdivision (b). Any delegation of power may be revoked at any time.
SEC. 4. Section 3965.1 of the Food and Agricultural Code is
amended to read:
3965.1. Notwithstanding Section 3965 or 4051, the board, without
prior approval from the department, may arrange for and conduct, or
cause to be conducted, or by contract permit to be conducted, any
activity by any individual, institution, corporation, or association
upon its property at a time as it may be deemed advisable, except for
the following:
(a) Revenue generating contracts involving hazardous activities,
as determined by the department, unless adequate insurance coverage
is provided, as determined by the department in consultation with the
Department of General Services.
(b) The activities specified in Sections 4051.1 and 4051.2.
SEC. 5. Section 4051 of the Food and
Agricultural Code is repealed.
4051. An association, with the approval of both the Department of
Food and Agriculture and the Department of General Services, may do
any of the following:
(a) Contract.
(b) Purchase, acquire, hold, sell, exchange, or convey any
interest in real or personal property and beautify or improve that
property. Any acquisition of land or other real property shall be
subject to the Property Acquisition Law (Part 11 (commencing with
Section 15850) of Division 3 of Title 2 of the Government Code).
(c) Lease, let, or grant licenses for the use of its real estate
or personal property, or any portion of that property, to any person
or public body for whatever purpose may be approved by the board.
(d) Use or manage its real estate or personal property, or any
portion of that property, for any or all of the purposes of this
section jointly with any lessee, sublessee, or licensee, or otherwise
use or manage the property in connection with the lease, sublease,
or license which is made or granted.
(e) Lease or let its real property for public park, recreational,
or playground purposes.
(f) Rent or permit the use of its premises for any purpose which
is beneficial to the agricultural industry, including, but not
limited to, the holding of sales or auctions of cattle or other
livestock.
(g) Contract with any county or county fair association for
holding a fair jointly with the county or county fair association.
The joint fair is a district fair of the association.
(h) Make permanent improvements upon publicly owned real property
adjacent to real property of the district when the improvements
materially benefit the property of the district.
(i) Pledge any and all revenues, moneys, accounts, accounts
receivable, contract rights, and other rights to payment of whatever
kind, pursuant to such terms and conditions as are approved by the
board. The revenues, moneys, accounts, accounts receivable, contract
rights, and other rights to payment of whatever kind pledged by the
association or its assignees constitute a lien and security interest
which immediately attaches to the property so pledged and is
effective, binding, and enforceable against the association, its
successors, purchasers of the property so pledged, creditors, and all
others asserting rights therein, to the extent set forth, and in
accordance with, the terms and conditions of the pledge, irrespective
of whether those persons have notice of the pledge and without the
need for any physical delivery, recordation, filing, or further act.
SEC. 6. Section 4051 is added to the
Food and Agricultural Code , to read:
4051. (a) An association may do any of the following:
(1) Contract, in accordance with all of the following:
(A) The written policies and procedures for contracting that are
developed and maintained by the board of directors of the association
in accordance with this section.
(B) All applicable state laws governing contracts, except as
follows:
(i) Any grant or contract entered into by an association for goods
is not subject to Chapter 2 (commencing with Section 10290) of Part
2 of Division 2 of the Public Contract Code.
(ii) Any grant or contract entered into by an association is not
subject to Chapter 3 (commencing with Section 12100) of Part 2 of
Division 2 of the Public Contract Code.
(C) If the estimated total cost of any construction project or
similar work carried out under this section exceeds twenty-five
thousand dollars ($25,000), the association shall solicit bids in
writing and shall award the work to the lowest responsible bidder or
reject all bids. The association is subject to all applicable
provisions of the Public Contract Code.
(D) An association may elect to become subject to the provisions
of the Uniform Public Construction Cost Accounting Act (Chapter 2
(commencing with Section 22000) of Part 3 of Division 2 of the Public
Contract Code) and the Small Business Procurement and Contract Act
(Chapter 6.5 (commencing with Section 14835) of Part 5.5 of Division
3 of Title 2 of the Government Code), but exempt from the reporting
requirements noted in subdivision (f) of Section 14838.1 of the
Government Code.
(2) Accept funds or gifts of value from the United States or any
person to aid in carrying out the purposes of this part.
(3) Conduct or contract for programs, and contract for the
purchase or lease of goods that are necessary to effectuate the
purposes of this chapter, either independently or in cooperation with
any individual, public or private organization, or federal, state,
or local governmental agency.
(4) Establish and maintain a bank checking account or other
financial institution account, approved by the Director of Finance in
accordance with Sections 16506 and 16605 of the Government Code, for
depositing funds received by the district agricultural association.
All funds maintained in an account authorized by this paragraph shall
be used in accordance with Section 4001.
(5) Approve the annual budget of the association and establish a
program for paying vendors who contract with the district
agricultural association.
(6) Contract with any county or county fair association for
holding a fair jointly with the county or county fair association.
The joint fair is a district fair of the association.
(7) Make or adopt all necessary orders, rules, or regulations for
governing the activities of the association. Notwithstanding Section
14, any orders, rules, or regulations adopted by the board are exempt
from Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code. For informational
purposes only, however, any order, rule, or regulation adopted by the
board may be transmitted to the Office of Administrative Law for
filing with the Secretary of State pursuant to Section 11343 of the
Government Code.
(8) Operate a payroll system for paying employees, and a system
for accounting for vacation and sick leave credits of employees.
(9) Delegate to the officers and employees of the association the
exercise of powers vested in the board, as the board may deem
desirable, for the orderly management and operation of the
association.
(10) With the approval of the Department of General Services,
purchase, acquire, hold, sell, or exchange, or convey any interest in
real property. Any acquisition of land or other real property shall
be subject to the Property Acquisition Law (Part 11 (commencing with
Section 15850) of Division 3 of Title 2 of the Government Code).
(11) With the approval of the Department of General Services, make
permanent improvements upon publicly owned real property adjacent
to, or near the vicinity of, the real property of the district
agricultural association when the improvements materially benefit the
property of the association pursuant to Section 11011 of the
Government Code.
(12) With the approval of the Department of General Services,
lease for the use of its real property, or any portion of that
property, to any person or public body for whatever purpose as may be
approved by the board.
(13) Use or manage any of its property jointly or in connection
with any lessee or sublessee, for any purpose approved by the board.
(14) With the approval of the Department of General Services,
pledge any revenues, moneys, accounts, accounts receivable, contract
rights, and other rights to payment of whatever kind, pursuant to
terms and conditions approved by the board. The revenues, moneys,
accounts, accounts receivable, contract rights, and other rights to
payment of whatever kind pledged by the association or its assignees
constitute a lien or security interest that immediately attaches to
the property pledged, and is effective, binding, and enforceable
against the association, its successors, purchasers of the property
pledged, creditors, and all others asserting rights therein, to the
extent set forth, and in accordance with, the terms and conditions of
the pledge, irrespective of whether those persons have notice of the
pledge and without the need for physical delivery, recordation,
filing, or further action.
(15) With the approval of the Secretary of Food and Agriculture,
enter into a joint powers agreement pursuant to the Joint Exercise of
Powers Act (Chapter 5 (commencing with Section 6500) of Division 7
of Title 1 of the Government Code).
(b) In developing the written policies and procedures for
contracting, the board shall incorporate the following to apply to
contracts or procurement by the association:
(1) To ensure the fullest competition, the board shall adopt and
publish competitive bidding procedures for the award of a procurement
or contract involving an expenditure of more than one hundred
thousand dollars ($100,000). The competitive bidding procedures shall
include, but not be limited to, requirements for submission of bids
and accompanying documentation, guidelines for the use of requests
for proposals, invitations to bid, or other methods of bidding, and a
bid protest procedure. The general manager shall determine whether
the goods or services subject to this paragraph are available through
existing contracts or price schedules of the Department of General
Services. The Legislature finds and declares that fairs are a
valuable community resource and recognizes that local businesses and
local communities make valuable contributions to fairs that include
direct and indirect support of fair programs. The Legislature further
finds and declares that local businesses often provide opportunity
purchases to local fairs that, for similar things available through
the state purchasing program, may be purchased locally at a price
equivalent to or less than that available through the state
purchasing program. As used in this subdivision, opportunity
purchases means purchases made locally, either individually or
cooperatively, at a price equal to or less than the price available
through the state purchasing program on or off state contract.
(2) The contracting standards, procedures, and rules contained in
this subdivision shall also apply with respect to any subcontract
involving an expenditure of more than one hundred thousand dollars
($100,000). The board shall establish, as part of the bidding
procedures for general contracts, subcontracting guidelines that
implement this requirement.
(3) The board is subject to the Small Business Procurement and
Contract Act (Chapter 6.5 (commencing with Section 14835) of Part 5.5
of Division 3 of Title 2 of the Government Code), but exempt from
the reporting requirements noted in subdivision (f) of Section
14838.1 of the Government Code.
(4) In advertising or awarding any general contract for the
procurement of goods and services exceeding one hundred thousand
dollars ($100,000), the board and the general manager shall require
all bidders or contractors to include specific plans to utilize
subcontracts with emerging small business entities. The
subcontracting plans shall delineate the nature and extent of the
services to be utilized, and the entity or individual identified for
subcontracting, if known.
(5) It is the intent of the Legislature in enacting this section
to establish as an objective of the utmost importance the advancement
of business opportunities for emerging small business entities in
the business activities created by the association. In that regard,
the board shall have an affirmative duty to achieve the most feasible
and practicable level of participation by emerging small business
entities.
(6) With the approval of the Department of General Services,
pledge any and all revenues, moneys, accounts, accounts receivable,
contract rights, and other rights to payment of whatever kind,
pursuant to terms and conditions approved by the board. Any issuance
of bonds, contracts entered into, debts incurred, settlements,
judgments, or liens under this section or pursuant to Chapter 5
(commencing with Section 6500) of Division 7 of Title 1 of the
Government Code, shall not directly, indirectly, or contingently
obligate the state or any political subdivision of the state to levy
or to pledge any form of taxation therefor or to make any
appropriation for their payment. The bond shall contain on its face a
statement to the following effect: "Neither the full faith and
credit nor the taxing power of the State of California is pledged to
the payment of the principal of, or interest on this bond."
(7) This section shall not apply to Article 1 (commencing with
Section 4101) of Chapter 6 of Part 3.
(c) (1) Notwithstanding any other law, an association shall adopt
a fiscal review policy as follows:
(A) An association with an annual budget exceeding five million
dollars ($5,000,000) shall conduct an annual audit by an independent
certified public accountant or certified public accountancy firm
selected by the board.
(B) An association with an annual budget of less than five million
dollars ($5,000,000) shall have its books and accounts examined and
reviewed annually and audited once every three years by an
independent certified public accountant or certified public
accountancy firm selected by the board.
(2) Notwithstanding paragraph (1), the department may require an
audit to be conducted before the times specified in subparagraphs (A)
and (B) of paragraph (1) if the department or the state deems the
audit is necessary.
SEC. 5. SEC. 7. Section 4051.2 of
the Food and Agricultural Code is amended to read:
4051.2. An association shall not enter into a settlement
agreement for an amount greater than one hundred thousand dollars
($100,000) without the prior approval of the department.
SEC. 6. SEC. 8. Section 4053 of the
Food and Agricultural Code is repealed.
SEC. 9. Section 4057 of the Food and
Agricultural Code is amended to read:
4057. The state is not liable for any action, obligation,
commitment, contract, or premium which
that is offered offered, or award
that is made, or on account of any contract which is made,
by any association.
SEC. 7. SEC. 10. Section 13332.09 of
the Government Code is amended to read:
13332.09. (a) A purchase order or other form of documentation for
acquisition or replacement of motor vehicles shall not be issued
against any appropriation until the Department of General Services
has investigated and established the necessity therefor.
(b) A state agency shall not acquire surplus mobile equipment from
any source for program support until the Department of General
Services has investigated and established the necessity therefor.
(c) Notwithstanding any other law, any contract for the
acquisition of a motor vehicle or general use mobile equipment for a
state agency shall be made by or under the supervision of the
Department of General Services. Pursuant to Section 10298 of the
Public Contract Code, the Department of General Services may collect
a fee to offset the cost of the services provided.
(d) Any passenger-type motor vehicle purchased for a state
officer, except a constitutional officer, or a state employee shall
be an American-made vehicle of the light class, as defined by the
California Victim Compensation and Government Claims Board, unless
excepted by the Director of General Services on the basis of unusual
requirements, including, but not limited to, use by the California
Highway Patrol, that would justify the need for a motor vehicle of a
heavier class.
(e) General use mobile equipment having an original purchase price
of twenty-five thousand dollars ($25,000) or more shall not be
rented or leased from a nonstate source and payment therefor shall
not be made from any appropriation for the use of the Department of
Transportation, without the prior approval of the Department of
General Services after a determination that comparable state-owned
equipment is not available, unless obtaining approval would endanger
life or property, in which case the transaction and the justification
for not having sought prior approval shall be reported immediately
thereafter to the Department of General Services.
(f) (1) The Trustees of the California State University shall, to
the greatest extent feasible, purchase vehicles using statewide
commodity contracts.
(2) The trustees shall make an interim report to the Governor and
the Legislature on January 1, 2014, and a final report on January 1,
2015, on their motor vehicle procurement, including all of the
following:
(A) An inventory, by campus, of motor vehicles that includes the
type of vehicle, vehicle usage and fuel data consistent with the
Department of General Services fleet asset management system and
reported to the Department of General Services.
(B) The number of motor vehicles purchased during the prior fiscal
year, disaggregated by campus and type of vehicle if the passenger
vehicle or truck was purchased through statewide commodity contracts,
and the purchase price.
(C) Any change to a policy or procedure made during the prior
fiscal year related to motor vehicle procurement and contracts for
procurement and identifying any vehicle procured pursuant to the new
policy or procedure.
(D) The average time to complete procurements, average
administrative costs, reduced charges paid to the Department of
General Services, and competitive or reduced market prices obtained
for the vehicles.
(3) A report submitted pursuant to this subdivision shall be
submitted in compliance with Section 9795.
(g) As used in this section:
(1) "General use mobile equipment" means equipment that is listed
in the Mobile Equipment Inventory of the State Equipment Council and
capable of being used by more than one state agency, and shall not be
deemed to refer to equipment having a practical use limited only to
the controlling state agency. Section 575 of the Vehicle Code shall
not have application to this section.
(2) "State agency" means a state agency, as defined pursuant to
Section 11000. The University of California is requested and
encouraged to have the Department of General Services perform the
tasks identified in this section with respect to the acquisition or
replacement of motor vehicles by the University of California. "State
agency" does not include a district agricultural association, as
defined in Section 3951 of the Food and Agricultural Code.
(h) This section shall remain in effect only until July 1, 2015,
and as of that date is repealed.
SEC. 8. SEC. 11. Section 10320 of
the Public Contract Code is repealed.
SEC. 12. Section 10321 of the Public
Contract Code is repealed.
10321. (a) (1) The Legislature finds and declares that fairs are
a valuable community resource and recognizes that local businesses
and local communities make valuable contributions to fairs that
include direct and indirect support of fair programs. The Legislature
further finds and declares that local businesses often provide
opportunity purchases to local fairs that, for similar things
available through the state purchasing program, may be purchased
locally at a price equivalent to or less than that available through
the state purchasing program.
(2) Notwithstanding any other provision of law, the Department of
Food and Agriculture shall develop criteria to be applied for
opportunity purchases that are made by district agricultural
associations, county and citrus fruit fairs, and the California
Exposition and State Fair, individually or cooperatively.
(3) As used in this subdivision, opportunity purchases means
purchases made locally, either individually or cooperatively, at a
price equal to or less than the price available through the state
purchasing program on or off state contract.
(b) (1) The Legislature finds and declares that district
agricultural associations and county and citrus fruit fairs often do
not have large, full-time staffs, and consequently the generally
applicable expenditure reporting requirements contained in the State
Administrative Manual (SAM) can represent an unreasonable paperwork
burden upon those associations and fairs.
(2) Notwithstanding any other provision of law, the Secretary of
Food and Agriculture may develop, in consultation with the Department
of General Services, an alternative expenditure reporting procedure
from the State Administrative Manual applicable to district
agricultural associations and county and citrus fruit fairs with
annual reportable expenditures of not more than one million dollars
($1,000,000). This procedure, at a minimum, shall maintain an audit
trail and protect the ability of state auditors to confirm the proper
use of state funds.