BILL ANALYSIS Ó
AB 351
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Date of Hearing: April 29, 2015
ASSEMBLY COMMITTEE ON ACCOUNTABILITY AND ADMINISTRATIVE REVIEW
Rudy Salas, Chair
AB 351
(Jones-Sawyer) - As Introduced February 17, 2015
SUBJECT: Public contracts: small business participation
SUMMARY: Requires each state agency to establish and achieve a
goal of 25% small business (SB) participation. Specifically,
this bill:
1)Requires all state agencies to establish and achieve an annual
goal of 25% SB participation.
2)Makes heads of agencies responsible for meeting the 25% annual
goal and reporting to the Department of General Services (DGS)
on their agency's progress.
3)Requires agencies that fail to meet the 25% annual goal to
submit a corrective action plan to DGS within 45 days of the
close of any fiscal year.
4)Requires DGS to regularly monitor agencies' progress in
meeting the 25% annual goal and regularly share related
information with the Office of the Small Business Advocate
(OSBA), including corrective action plans.
5)Directs DGS and the OSBA to assist agencies in implementing
their corrective action plans to the extent feasible.
AB 351
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6)Requires all state agencies to apply the existing streamlined
SB state contracting option to contracts under $100,000 and
construction contracts under $120,000.
7)Requires DGS to collaborate with the OSBA to provide outreach
and actively promote SB certification.
8)Clarifies that the requirements of this bill apply to the
University of California, the California State University, and
the California Community Colleges when contracting with state
funds.
EXISTING LAW:
1)Designates the DGS as the lead purchasing and procurement
agency for the State of California tasked with administering
the SB certification programs.
2)Requires, through executive order, various state contracts to
have annual statewide participation goals of at least 25%.
3)Establishes the streamlined SB state contracting option, which
allows state agencies to award a contract valued between
$5,000 and $250,000 to a SB if quotes are obtained from two or
more certified firms.
FISCAL EFFECT: Unknown
COMMENTS: According to the author, this bill would "codify a
statewide procurement goal of 25% SB participation in statute,
only to be removed by the Legislature, and in doing so, send a
strong message to potential investors that the state supports
small businesses."
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According to the consolidated annual report on procurement for
fiscal year (FY) 2013-14 by DGS, the state entered into nearly
$9 billion in contracts, with approximately 26% awarded to small
businesses. The report also indicates statewide departments
achieved nearly 26% percent SB participation in contracts.
However, in the last 15 report periods, the state has only met
the 25% SB participation goal five times.
To provide more consistency in achieving the SB procurement
participation goal, this bill places the goal in statute;
charges DGS with regularly monitoring agencies' progress in
meeting the goal; and, requires mitigation plans from poor
performing departments.
PRIOR LEGISLATION: AB 1734 (Jones-Sawyer) of 2014 was
substantially similar to this bill and would have additionally
required an annual phased-in goal of 5% participation by
disabled veteran business enterprises in state contracting. AB
1734 was held in the Assembly Appropriations Committee.
DOUBLE REFERRAL: This measure was previously heard in the
Assembly Jobs, Economic Development and the Economy Committee on
April 21, 2015, with a vote of 8-0.
REGISTERED SUPPORT / OPPOSITION:
Support
California Black Chamber of Commerce (sponsor)
AB 351
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California Asian Pacific Chamber of Commerce
Opposition
None on file
Analysis Prepared by:Cassie Royce / A. & A.R. / (916) 319-3600