Senate Bill No. 437

Introduced by Senator Berryhill

February 21, 2013

An act to amend Section 999.2 of the Military and Veterans Code, relating to veterans.

LEGISLATIVE COUNSEL’S DIGEST

SB 437, as introduced, Berryhill. Disabled veterans: contracting preferences.

Existing law requires contracts awarded by state agencies for construction, professional services, materials, supplies, equipment, alteration, repair, or improvement to have a 3% participation goal for disabled veterans enterprises, as defined.

This bill would make a technical, nonsubstantive change to that provision.

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

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

SECTION 1.  

Section 999.2 of the Military and Veterans Code
is amended to read:

999.2.  

(a) Notwithstanding any other begin delete provision of end delete law,
contracts awarded by any state agency, department, officer, or
other state governmental entity, including school districts when
they are expending state funds for construction, professional
services (except those subject to Chapter 6 (commencing with
Section 16850) of Part 3 of Division 4 of Title 2 of the Government
Code), materials, supplies, equipment, alteration, repair, or
improvement shall have statewide participation goals of not less
than 3 percent for disabled veteran business enterprises. These
goals apply to the overall dollar amount expended each year by
the awarding department.

(b) For purposes of this section:

(1) “Broker” or “agent” means any individual or entity, or any
combination thereof, that does not have title, possession, control,
and risk of loss of materials, supplies, services, or equipment
provided to an awarding department, unless one or more certified
disabled veterans has 51 percent ownership of the quantity and
value of the materials, supplies, services, and of each piece of
equipment provided under the contract.

(2) “Equipment” means any piece of equipment that is used or
provided for rental to any state agency, department, officer, or
other state governmental entity, including equipment for which
operators are provided.

(3) “Equipment broker” means any broker or agent who rents
equipment to an awarding department.

(c) A disabled veteran business enterprise that rents equipment
to an awarding department shall be deemed to be an equipment
broker unless one or more disabled veterans has 51-percent
ownership of the quantity and the value of each piece of equipment.
If the equipment is owned by one or more disabled veterans, each
disabled veteran owner shall, prior to performance under any
contract, submit to the awarding department a declaration signed
by the disabled veteran owner stating that the owner is a disabled
veteran and providing the name, address, telephone number, and
tax identification number of the disabled veteran owner. Each
disabled veteran owner shall submit his or her federal income tax
returns to the administering agency pursuant to subdivision (g) as
if he or she were a disabled veteran business enterprise. The
disabled veteran business enterprise of a disabled veteran owner
who fails to submit his or her tax returns will be deemed to be an
equipment broker.

(d) A disabled veteran business enterprise that rents equipment
to an awarding department shall, prior to performing the contract,
submit to the awarding department a declaration signed by each
disabled veteran owner and manager of the enterprise stating that
the enterprise obtained the contract by representing that the
enterprise was a disabled veteran business enterprise meeting and
maintaining all of the requirements of a disabled veteran business
enterprise. The declaration shall include the name, address,
telephone number, and tax identification number of the owner of
each piece of equipment identified in the contract.

(e) State funds expended for equipment rented from equipment
brokers pursuant to contracts awarded under this section shall not
be credited toward the 3-percent goal.

(f) A disabled veteran business enterprise that is a broker or
agent and that obtains a contract pursuant to subdivision (a) shall,
prior to performing the contract, disclose to the awarding
department that the business is a broker or agent. The disclosure
shall be made in a declaration signed and executed by each disabled
veteran owner and manager of the enterprise, declaring that the
enterprise is a broker or agent, and identifying the name, address,
and telephone number of the principal for whom the enterprise is
acting as a broker or agent.

(g) (1) A disabled veteran business enterprise, and each owner
thereof, shall, at the time of certification, submit to the
administering agency complete copies of the enterprise’s federal
income tax returns for the three previous tax years.

(2) A disabled veteran business enterprise, and each owner
thereof, shall submit to the administering agency complete copies
of the enterprise’s federal income tax returns that have a
postcertification due date, on or before the due date, including
extensions.

(3) A disabled veteran business enterprise that, and each owner
thereof who, has not submitted to the administering agency
complete copies of the enterprise’s federal income tax returns for
the three tax years preceding certification nor for each
postcertification tax year for which a return was required to be
filed, shall have 90 days to submit those returns.

(4) A disabled veteran business enterprise that fails to comply
with any provision of this subdivision shall be prohibited from
participating in any state contract until the disabled veteran
business enterprise complies with the provisions of this subdivision.
Funds expended involving a disabled veteran business enterprise
during any period in which that enterprise is not in compliance
with the provisions of this subdivision shall not be credited toward
the awarding department’s 3-percent goal.

(h) A disabled veteran business enterprise that fails to maintain
the certification requirements set forth in this article shall
immediately notify the awarding department and the administering
agency of that failure by filing a notice of failure that states with
particularity each requirement the disabled veteran business
enterprise has failed to maintain.