AB 10, as introduced, Levine. Public works: contracts: extra compensation.
Existing law sets forth requirements for provisions in public works contracts awarded by a state entity. Under existing law, the state or any other public entity in any competitively bid public works contract may provide for the payment of extra compensation to the contractor for cost reduction changes.
This bill would provide that a state entity in a megainfrastructure project contract, as defined, may not provide for the payment of extra compensation to the contractor until the megainfrastructure project, as defined, has been completed and an independent third party has verified that the megainfrastructure project meets all architectural or engineering plans and safety specifications of the contract. This bill would apply to contracts entered into or amended on or after the effective date of this bill.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 7101.5 is added to the Public Contract
2Code, to read:
(a) Notwithstanding any other law, a state entity in a
4megainfrastructure project contract may not provide for the
5payment of extra compensation to the contractor until the
6megainfrastructure project has been completed and an independent
7third party has verified that the megainfrastructure project meets
8all architectural or engineering plans and safety specifications of
9the contract.
10(b) This section shall apply to contracts entered into or amended
11on or after the effective date of this section.
12(c) This section shall only apply to megainfrastructure projects
13that, consistent with the requirement of subdivision (b) of Section
143 of Article IV of the California Constitution, relate
to the
15proclamation issued by the Governor on June 16, 2015, to convene
16the Legislature to assemble in extraordinary session to, among
17other things, consider and act upon legislation necessary to
18incorporate project development efficiencies to expedite project
19delivery or reduce project costs.
20(d) For purposes of this section, all of the following definitions
21shall apply:
22(1) “Extra compensation” means any extra compensation that
23is provided for in the megainfrastructure project contract pursuant
24to the authorization in Section 7101.
25(2) “Megainfrastructure project” means the erection,
26construction, alteration, repair, or improvement of any public
27structure, building, road, or other public improvement of any kind
28that exceeds one billion dollars ($1,000,000,000) in cost.
29(3) “Megainfrastructure project contract” means an agreement
30for a megainfrastructure project.
31(4) “State entity” means every state office, department, division,
32bureau, board, or commission, but does not include the Legislature,
33the courts, any agency in the judicial branch of government, or the
34University of California.
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