BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 429


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          Date of Hearing:  April 29, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          429 (Dahle) - As Amended April 8, 2015


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:


          This bill requires state agencies, when purchasing lumber or  
          other solid wood products, to give a preference, and price and  
          quality are equal, to products harvested pursuant to California  
          statutes and regulations governing this activity-specifically  








                                                                     AB 429


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          the Z'berg-Nejedly Forest Practice Act of 1973.


          FISCAL EFFECT:


          The Department of General Services (DGS) indicates it would need  
          to conduct a rulemaking to modify existing preference program  
          regulations to reflect that other preferences do not operate  
          when they would result in Forest Practice Act-grown timber over  
          non-Forest Practice Act-grown timber. In addition, DGS would  
          need to update the State Contracting Manual and training  
          materials for the California Procurement and Contracting Academy  
          basic course to reflect the new requirement. These one-time  
          costs should be absorbable.

          In individual cases where the harvesting practice for the timber  
          became a deciding factor in a contract award, a state agency  
          would need to be able to verify whether the wood products being  
          purchased were made from timber using harvesting practices in  
          compliance with the Forest Practice Act. The bill's provisions  
          would apply to only a very narrow range of state purchase  
          contracts, however. DGS indicates that annual direct spending on  
          lumber and wood products by the state is around $1.4 million, so  
          the cost impact of this bill should not be significant.

          The requirement that the wood products be harvested consistent  
          with California law, assuming price is equal, could discourage  
          out-of-state suppliers from bidding, thus reducing competition  
          and increasing contracting costs for wood products. 


          COMMENTS:


          1)Purchase. The author states this bill would simply encourage  
            state agencies to give preference to California lumber  
            products as long as the price, quality and fitness of products  
            are equal.  The problem with existing law, the author  








                                                                     AB 429


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            contends, is that there is no recognition of the higher  
            California standards of environmental compliance for  
            California timber companies.  Production has fallen due to  
            timberland removals from production for environmental and  
            social benefit; high costs of compliance with regulations;  
            and, competition from out-of-state producers.


          2)Prior Legislation. AB 994 (Parra) of 2007, a similar bill,  
            passed the Assembly, but was amended in the Senate to address  
            a different topic.


            AB 2994 (Frommer) of 2004, another similar bill, was vetoed by  
            Governor Schwarzenegger, who was opposed another preference in  
            state contracts.


          Analysis Prepared by:Chuck Nicol / APPR. / (916)  
          319-2081