BILL ANALYSIS �
SB 681
Page 1
Date of Hearing: August 6, 2013
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Das Williams, Chair
SB 681 (Ed Hernandez) - As Amended: April 1, 2013
SENATE VOTE : 34-0
SUBJECT : Community college districts: personal property.
SUMMARY : Clarifies existing law authorizing a community
college district to "piggyback" on an existing contract between
a public corporation or agency (including any county, city,
town, or district) and a vendor for the lease or purchase of
personal property by clarifying that, like school districts, the
community college districts can purchase directly from, and make
payments directly to, the vendor, without needing to go through
the original contracting agency.
EXISTING LAW :
1)Establishes various procedures to be followed by the community
colleges to secure bids or proposals and enter into contracts
for the acquisition of goods and services (Education Code
�81641, �81644, �81645).
2)Notwithstanding the Education Code provisions cited above,
community colleges are authorized, under specified conditions
to authorize any public corporation or agency, including any
county, city, town, or district, to lease data-processing
equipment, purchase materials, supplies, equipment, automotive
vehicles, tractors, and other personal property for the
district in the manner in which the public corporation or
agency is authorized by law to make the leases or purchases,
without advertising for bids, and to make payments to the
public corporation or agency for furnishing the services
incidental to the lease or purchase of the personal property
(Public Contract Code [PCC] �20652).
3)Provides the same authority as outlined for community colleges
above to school districts. However, current law also provides
that, if there is an existing contract between a public
corporation or agency and a vendor for the lease or purchase
of the personal property, a school district may authorize the
lease or purchase of personal property directly from the
SB 681
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vendor and make payment to the vendor under the same terms
that are available to the public corporation or agency under
the contract (PCC �20118).
FISCAL EFFECT : Unknown. This measure is keyed non-fiscal by
the Legislative Counsel.
COMMENTS : Background . The term "piggyback" stems from the PCC
�20118, which allows school districts to acquire personal
property by participating in an existing contract of another
public entity. According to some community college districts,
piggybacking can save months of time and significant costs as
districts, in order to go out for bid, must prepare documents,
advertise for bid, obtain local board approval and place award.
While the statute applies to the acquisition of personal
property, in the past, questions have arisen in regards to its
use for facilities related purchases, as school districts were
using "piggyback" contracts to acquire and install factory-built
modular building components that result in permanent school
facilities funded by the School Facility Program. At the
request of the State Allocation Board, the Attorney General
issued an opinion in January 2006 which found that:
1)A school district may not, without advertising for bids,
contract with another public agency to acquire factory-built
modular building components for installation on a permanent
foundation;
2)A school district intending to contract for the construction,
reconstruction, renovation, improvement or repair of any
school building, where the work will require an expenditure of
$15,000 or more, must follow a competitive bidding process;
and,
3)Once these modular components have been attached at the
building site, and after significant on-site finish work has
been completed, they would result in permanent school
buildings of varying dimensions, purpose; and architectural
styles i.e. they are no longer personal property.
Need for the bill . Current law authorizes both community
colleges and school districts to "piggyback" onto existing
contracts between vendors and public corporations or agencies.
In 2006, the Legislature clarified that this school district
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authority extended to allowing a school district, without being
listed or referenced on the original contract, to be included
without the originating public agency needing to secure
agreement from the vendor that the contract could be
"piggybacked." This change in the law allowed for the benefits
of "piggybacking" without having to go through the original
contracting agency to buy and then transfer the item,
authorizing school districts to work directly with the vendor.
According to the author, this measure would address an inequity
(between school districts and community college districts)
conforming current law for community college districts to
existing law for school districts relative to "piggyback"
bidding.
REGISTERED SUPPORT / OPPOSITION :
Support
Community College League of California
Kern Community College District
Los Angeles Community College District
Los Rios Community College District
Peralta Community College District
Rio Hondo Community College District
Opposition
None on file.
Analysis Prepared by : Jeanice Warden / HIGHER ED. / (916)
319-3960