Amended in Assembly March 26, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 558

Introduced by Assembly Member Low

February 23, 2015

An act to amend begin delete Section 12016 end delete begin insert Sections 12102.2, 12104, and 12104.5 end insert of the Public Contract Code, relating to public contracts.

LEGISLATIVE COUNSEL’S DIGEST

AB 558, as amended, Low. Public contracts: state contracts: information technology goods and services.

Existing law authorizes the Department of General Services and the Department of Technology to adopt rules and regulations as are necessary to govern the acquisition and disposal of information technology goods and services. begin insert Existing law requires contract awards for all large-scale systems integration projects to be based on the proposal that provides the most value-effective solutions to the state’s requirements, as specified, and requires evaluation criteria for the acquisition of information technology goods and services, including systems integration, to provide for the selection of a contractor on an objective basis not limited to cost alone. Existing law requires the Department of Technology to invite active participation, review, advice, comment, and assistance from the private sector and state agencies in developing procedures to streamline and make the acquisition process more efficient, and requires solicitations for acquisitions based on evaluation criteria other than cost alone to provide that sealed cost proposals be submitted. end insert

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This bill would make a technical, nonsubstantive change to this provision.

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This bill would require the Department of Technology, in developing procedures to streamline and make the acquisition process more efficient, to require the acquisition methodology to use electronic means, whenever possible, to reduce paper submissions and allow for electronic submission of bids and proposals. This bill would also require solicitations for acquisitions based on evaluation criteria other than cost alone to provide that electronic cost proposals be submitted whenever possible.

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Existing law requires the Department of General Services and the Department of Technology to develop, implement, and maintain standardized methods for the development of all information technology requests for proposals.

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This bill would require the standardized methods to include, whenever possible, electronic formats for electronic bid solicitation and electronic receipt of bid proposals.

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Existing law requires all rules and requirements and any changes to the rules and requirements governing an information technology acquisition, for which the Department of General Services or the Department of Technology determines that a request for proposal is appropriate, to be communicated in writing to all vendors that have expressed an intent to bid and to be posted in a public location.\

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This bill would require all rules and requirements and any changes to the rules and requirements to be communicated electronically and to be posted on the Internet Web site of the Department of General Services and the Department of Technology whenever possible.

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Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insert SECTION 1. end insert   

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begin insert Section 12102.2 of the end insert begin insert Public Contract Code end insert begin insert is
amended to read: end insert

12102.2.  

(a) Contract awards for all large-scale systems
integration projects shall be based on the proposal that provides
the most value-effective solution to the state’s requirements, as
determined by the evaluation criteria contained in the solicitation
document. Evaluation criteria for the acquisition of information
technology goods and services, including systems integration, shall
provide for the selection of a contractor on an objective basis not
limited to cost alone.

(1) The Department of Technology shall invite active
participation, review, advice, comment, and assistance from the
private sector and state agencies in developing procedures to
streamline and to make the acquisition process more efficient,
including, but not limited to, consideration of comprehensive
statements in the request for proposals of the business needs and
governmental functions, access to studies, planning documents,
feasibility study reports and draft requests for proposals applicable
to solicitations, minimizing the time and cost of the proposal
submittal and selection process, and development of a procedure
for submission and evaluation of a single proposal rather than
multiple proposals. begin insert The acquisition methodology shall use
electronic means, whenever possible, to reduce paper submissions
and allow for electronic submission of bids and proposals. end insert

(2) Solicitations for acquisitions based on evaluation criteria
other than cost alone shall provide that sealed cost proposals begin insert or,
whenever possible, electronic cost proposals, end insert shall be submitted
and that they shall be opened at a time and place designated in the
solicitation for bids and proposals. Evaluation of all criteria, other
than cost, shall be completed prior to the time designated for public
opening of cost proposals, and the results of the completed
evaluation shall be published immediately before the opening of
cost proposals. The state’s contact person for administration of the
solicitation shall be identified in the solicitation for bids and
proposals, and that person shall execute a certificate under penalty
of perjury, which shall be made a permanent part of the official
contract file, that all cost proposals received by the state have been
maintained sealed and under lock and key begin insert or sufficiently secured
electronically end insert until the time cost proposals are opened.

(b) The acquisition of hardware acquired independently of a
system integration project may be made on the basis of lowest cost
meeting all other specifications.

(c) The 5 percent small business preference provided for in
Chapter 6.5 (commencing with Section 14835) of Part 5.5 of
Division 3 of Title 2 of the Government Code and the regulations
implementing that chapter shall be accorded to all qualifying small
businesses.

(d) For all transactions formally advertised, evaluation of
bidders’ proposals for the purpose of determining contract award
for information technology goods shall provide for consideration
of a bidder’s best financing alternatives, including lease or purchase
alternatives, if any bidder so requests, not less than 30 days prior
to the date of final bid submission, unless the acquiring agency
can prove to the satisfaction of the Department of General Services
that a particular financing alternative should not be so considered.

(e) Acquisition authority may be delegated by the Director of
General Services to any state agency that has been determined by
the Department of General Services to be capable of effective use
of that authority. This authority may be limited by the Department
of General Services. Acquisitions conducted under delegated
authority shall be reviewed by the Department of General Services
on a selective basis.

(f) To the extent practical, the solicitation documents shall
provide for a contract to be written to enable acquisition of
additional items to avoid essentially redundant acquisition
processes when it can be determined that it is economical to do
so.

(g) Protest procedures shall be developed to provide bidders an
opportunity to protest any formal, competitive acquisition
conducted in accordance with this chapter. The procedures shall
provide that protests must be filed no later than five working days
after the issuance of an intent to award. Authority to protest may
be limited to participating bidders. The Director of Technology,
or a person designated by the director, may consider and decide
on initial protests of bids for information technology projects
conducted by the Department of Technology and
telecommunications procurement made pursuant to Section 12120.
The Director of the Department of General Services, or a person
designated by the director, may consider and decide on initial
protests of all other information technology acquisitions. A decision
regarding an initial protest shall be final. If prior to the last day to
protest, any bidder who has submitted an offer files a protest with
the department against the awarding of the contract on the ground
that his or her bid or proposal should have been selected in
accordance with the selection criteria in the solicitation document,
the contract shall not be awarded until either the protest has been
withdrawn or the California Victim Compensation and Government
Claims Board has made a final decision as to the action to be taken
relating to the protest. Within 10 calendar days after filing a protest,
the protesting bidder shall file with the Victim Compensation and
Government Claims Board a full and complete written statement
specifying in detail the grounds of the protest and the facts in
support thereof.

(h) Consistent with the procedures established and administered
by the Department of General Services, information technology
goods that have been determined to be surplus to state needs shall
be disposed of in a manner that will best serve the interests of the
state. Procedures governing the disposal of surplus goods may
include auction or transfer to local governmental entities.

(i) A supplier may be excluded from bid processes if the
supplier’s performance with respect to a previously awarded
contract has been unsatisfactory, as determined by the state in
accordance with established procedures that shall be maintained
in the State Administrative Manual. This exclusion may not exceed
36 months for any one determination of unsatisfactory
performance. Any supplier excluded in accordance with this section
shall be reinstated as a qualified supplier at any time during this
36-month period, upon demonstrating to the Department of General
Services’ satisfaction that the problems that resulted in the
supplier’s exclusion have been corrected.

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begin insert SEC. 2. end insert   

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begin insert Section 12104 of the end insert begin insert Public Contract Code end insert begin insert is amended
to read: end insert

12104.  

(a) (1) The State Contracting Manual shall set forth
all procedures and methods that shall be used by the state when
seeking to obtain bids for the acquisition of information technology.

(2) Revisions to the manual must be publicly announced,
including, but not limited to, postings on the Internet Web site
homepage of the Department of General Services. The Department
of Technology shall provide a link to the State Contracting Manual
on its Internet Web site homepage.

(b) The Department of General Services and the Department of
Technology in accordance with this chapter shall develop,
implement, and maintain standardized methods for the development
of all information technology requests for begin delete proposals. end delete begin insert proposals,
including, whenever possible, electronic formats for electronic bid
solicitation and electronic receipt of bid proposals. end insert

(c) All information technology requests for proposals shall be
reviewed by the Department of Technology prior to release to the
public.

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begin insert SEC. 3. end insert   

end insert

begin insert Section 12104.5 of the end insert begin insert Public Contract Code end insert begin insert is
amended to read: end insert

12104.5.  

(a) All rules and requirements governing an
information technology acquisition, for which the Department of
General Services or the Department of Technology determines
that a request for proposal (RFP) is appropriate, shall be
communicated in writing begin insert or, whenever possible, electronically, end insert to
all vendors that have expressed an intent to bid and shall be posted
in a public begin delete location. end delete begin insert location or, whenever possible, on the Internet
Web site of the Department of General Services and the
Department of Technology. end insert Any changes to the rules and
requirements governing that RFP shall be communicated in writing
begin insert or, whenever possible, electronically, end insert to all vendors that have
expressed an intent to bid and shall be posted in a public begin delete location. end delete
begin insert location or, whenever possible, on the Internet Web site of the
Department of General Services and the Department of
Technology. end insert Requirements other than those provided by law or
outside of the published RFP and posted addendums shall not be
used to score bids.

(b) (1) All requests for proposals shall contain the following
statement:

“It is unlawful for any person engaged in business within this
state to sell or use any article or product as a “loss leader” as
defined in Section 17030 of the Business and Professions Code.”

(2) The Department of General Services shall post in the State
Contracting Manual instructions for including the statement
required by paragraph (1) in all affected contracts.

(3) The statement required by paragraph (1) shall be deemed to
be part of a request for proposal even if the statement is
inadvertently omitted from the request for proposal.

(c) The requirements of this section shall be in addition to any
other requirement provided by law.

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SECTION 1.  

Section 12106 of the Public Contract Code is
amended to read:

12106.  

The Department of General Services and the Department
of Technology may, in addition to fulfilling the mandatory
requirements enumerated in Sections 12102, 12102.1, and 12102.2,
adopt rules and regulations as are necessary for the purposes of
this chapter.

end delete