BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 495|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
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THIRD READING
Bill No: AB 495
Author: Gordon (D)
Introduced:2/23/15
Vote: 21
SENATE GOVERNANCE & FIN. COMMITTEE: 7-0, 6/10/15
AYES: Hertzberg, Nguyen, Beall, Hernandez, Lara, Moorlach,
Pavley
ASSEMBLY FLOOR: 79-0, 4/16/15 - See last page for vote
SUBJECT: Regional park and open-space districts: general
manager: powers
SOURCE: Author
DIGEST: This bill increases, from $25,000 to $50,000, the
maximum value of contracts which two regional park and open
space districts may enter into without using a formal bid
process.
ANALYSIS:
Existing law:
1)Requires regional park and open space districts to advertise
contracts for supplies, materials, labor, and construction and
award them to the lowest responsible bidder.
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2)Allows, with the board of directors' approval, a district's
general manager to award smaller jobs without advertising and
without written contracts and requires the manager to report
this spending at the board's next regular meeting.
3)Allows regional park and open space districts can spend up to
$25,000 for non-construction supplies, materials, and labor,
and up to $25,000 on new construction projects without going
through a formal bidding process (AB 745, Levine, Chapter 42,
Statutes of 2014).
This bill:
1)Allows the general manager of the East Bay Regional Park
District (EBRPD) and the general manager of the Midpeninsula
Regional Open Space District (MROSD), with the approval of the
district's board, to bind the district, in accordance with
board policy, and without advertising, for the payment of
supplies, materials, labor, or other valuable consideration
for any purpose, including new construction of a building,
structure, or improvement, in amounts not exceeding $50,000.
2)Requires that all expenditures must be reported to the board
of directors at its next regular meeting.
Background
A $25,000 threshold for construction contracts has applied to
all regional park and open space districts since 1983 (AB 746,
Campbell, Chapter 48, Statutes of 1983). The bid threshold for
non-construction contracts was increased from $10,000 to $25,000
for EBRPD in 1999 (AB 584, Aroner, Chapter 135, Statutes of
1999) and for MROSD in 2002 (AB 953, Simitian, Chapter 23,
Statutes of 2002).
The EBRPD is a system of parklands and trails in Alameda and
Contra Costa counties. The system comprises 119,000 acres in 65
parks, including over 1,250 miles of trails. The EBRPD
acquires, manages, and preserves natural and cultural resources
and is one of the largest park districts in the country.
The MROSD has permanently preserved nearly 62,000 acres of
mountainous, foothill, and bay land open space, creating 26 open
space preserves (24 of which are open to the public). The MROSD
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covers an area of 550 square miles and includes 17 cities,
covering parts of Santa Clara County, San Mateo County, and a
small portion of Santa Cruz County. In June 2014, more than 2/3
of the district's voters approved a $300 million general
obligation bond measure. Proceeds from bonds, which will be
sold in a series over approximately the next 20-30 years, will
be used to protect natural open space lands, open preserves or
areas of preserves that are currently closed, construct public
access improvements such as new trails and staging areas, and
restore and enhance open space land, which includes forests,
streams, watersheds, and coastal ranch areas.
The formal bid process for public contracts can be time
consuming and costly. Because inflation has eroded the
districts' buying power since their $25,000 bid thresholds were
enacted, EBRPD and MROSD must go through the effort and expense
of seeking bids for relatively low-value contracts. EBRPD and
MROSD officials want the Legislature to raise the dollar
threshold at which they must seek formal bids for their
construction, maintenance, and service contracts.
Comments
Purpose of the bill. The EBRPD reports that in 2014, the
district went through a formal bidding process to award 75
contracts with a value that fell in the $25,000 to $50,0000
range. At an average administrative cost of $4,500 per contract,
these contracts cost the district nearly $340,000. Similarly,
MROSD anticipates that, as a result of expenditures on projects
approved as part of its recent general obligation bond measure,
the district will be entering into hundreds of contracts with
values that fall in the $25,000 to $50,000 range. Avoiding a
formal bid process for contracts worth less than $50,000 will
allow EBRPD and MROSD to get many projects completed more
quickly and reduce staff time and administrative costs
associated with formal bidding. The savings that the districts
will realize as a result of the higher bid threshold, AB 495
will allow the districts to devote more resources towards their
core mission of preserving open space lands, protecting natural
environments, and providing public access to nature preserves,
trails, and other amenities.
Accountability and efficiency. State law regulating local
contracting attempts to balance the goals of accountability and
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efficiency. Accountability asks public officials to spend the
public's money in full view, inviting bids and awarding
contracts to the lowest possible bidder is an effective method
of ensuring transparency for the expenditures of public funds.
While increasing the limits on the amount for which districts
may contract without the formal bid process, allows for greater
efficiency in local government spending, it may also result in a
loss of accountability and transparency on the use of public
funds.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:NoLocal: No
SUPPORT: (Verified6/16/15)
East Bay Regional Park District
Midpeninsula Regional Open Space District
OPPOSITION: (Verified6/16/15)
Construction Industry Force Account Council
ASSEMBLY FLOOR: 79-0, 4/16/15
AYES: Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,
Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang,
Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle,
Daly, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina
Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,
Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden,
Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder,
Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina,
Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen,
Patterson, Perea, Rendon, Ridley-Thomas, Rodriguez, Salas,
Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner,
Waldron, Weber, Wilk, Williams, Wood, Atkins
NO VOTE RECORDED: Quirk
Prepared by:Brian Weinberger / GOV. & F. / (916) 651-4119
6/17/15 13:49:29
AB 495
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