Amended in Senate July 6, 2015

Amended in Assembly May 6, 2015

Amended in Assembly April 16, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 865

Introduced by Assembly Member Alejo

(Coauthor: Assembly Member Jones-Sawyer)

February 26, 2015

An act to add Section 25230 to the Public Resources Code, relating to the State Energy Resources Conservation and Development Commission.

LEGISLATIVE COUNSEL’S DIGEST

AB 865, as amended, Alejo. State Energy Resources Conservation and Development Commission: contracts, grants, and loans: diversity.

The Warren-Alquist State Energy Resources Conservation and Development Act establishes the State Energy Resources Conservation and Development Commission. Existing law requires the State Energy Resources Conservation and Development Commission to administer various grant and loan programs.

This bill would require the State Energy Resources Conservation and Development Commission to develop an outreach program to inform begin delete and recruit end delete the most qualified loan and grant applicants, and contractors, including, but not limited to, women, minority, disabled veteran, and LGBT business enterprises, as defined. The bill would require that one component of the outreach program be a process for tracking the diversity of contractors, loan recipients, and grant recipients. The bill would require begin delete the commission to include certified end delete begin insert the outreach program to include a strategy to inform certified end insert women, minority, disabled veteran, and LGBT business enterprises begin delete in announcements end delete about workshops, trainings, and funding opportunities, as appropriate, and consider including them in capacity building activities. The bill would require the commission to require that each contractor, recipient of a grant awarded, or loan approved by the commission on or after begin delete October 1, 2016, end delete begin insert July 1, 2017, end insert for an amount of $1,000,000 or more, including amended contracts, loans, and grant agreements that bring the total value of the loan or grant to $1,000,000 or begin delete more (1) report end delete begin insert more, or a different threshold or criteria determined to be appropriate by the commission, to (1) submit a report to the commission end insert on the demographic makeup of the management of the firm or organization, (2) submit a detailed begin delete and verifiable end delete outreach plan begin insert to the commission end insert for increasing subcontractor opportunities by certified women, minority, disabled veteran, and LGBT business enterprises, (3) implement the outreach plan to the best of the contractor’s or recipient’s financial and administrative capacity, and (4) furnish a report to the commission regarding the activities and outcomes achieved in implementing the outreach plan. The bill would require the commission to establish guidelines for all contractors, grant recipients, and loan recipients to utilize in preparing, implementing, and reporting on the outreach plans. The bill would require each contractor and recipient of a grant or loan that is subject to the bill’s requirements to submit data begin delete on a form provided end delete begin insert in a format to be specified end insert by the commission of the activities and outcomes of its outreach plan on October 1 of the following fiscal year in which the begin delete contract was awarded, the loan was approved, or the grant was received. end delete begin insert contract, grant, or loan was awarded. end insert The bill would require the begin delete State Energy Resources Conservation and Development Commission end delete begin insert commission end insert to consider establishing a Diversity Task Force to consider and make recommendations about diversity in the energy industry, including diversity of corporate governing boards and procurement from diverse begin delete businesses. end delete begin insert businesses, and addressing and promoting local and targeted hiring. end insert

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

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

SECTION 1.  

Section 25230 is added to the Public Resources
Code, to read:

25230.  

(a) For purposes of this section, the following terms
have the following meanings:

begin insert

(1) “Certified” means a business enterprise that is certified by
the Public Utilities Commission, the Department of General
Services, or other nonprofit organizations that verify or certify
women, minority, disabled veteran, and LGBT business enterprises.

end insert begin delete

(1)

end delete

begin insert (2) end insert  “Control” means exercising the power to make policy
decisions.

begin delete

(2)

end delete

begin insert (3) end insert  “Disabled veteran business enterprise” has the same meaning
as defined in Section 999 of the Military and Veterans Code.

begin delete

(3)

end delete

begin insert (4) end insert  “LGBT business enterprise” means a business enterprise
that is at least 51 percent owned by a lesbian, gay, bisexual, or
transgender person or persons, or, in the case of any publicly owned
business, at least 51 percent of the stock of which is owned by one
or more lesbian, gay, bisexual, or transgender persons, and whose
management and daily business operations are controlled by one
or more of those individuals.

begin delete

(4)

end delete

begin insert (5) end insert  “Minority business enterprise” means a business enterprise
that is at least 51 percent owned by a minority group or groups,
or, in the case of any publicly owned business, at least 51 percent
of the stock of which is owned by one or more minority groups,
and whose management and daily business operations are
controlled by one or more of those individuals. The contracting
utility shall presume that minority includes African Americans,
Hispanic Americans, Native Americans, and Asian Pacific
Americans.

begin delete

(5)

end delete

begin insert (6) end insert  To “operate” means to be actively involved in the day-to-day
management. It is not enough to merely be an officer or director.

begin delete

(6)

end delete

begin insert (7) end insert  “Renewable energy project” means a project for the
development and operation of an eligible renewable energy
resource meeting the requirements of the California Renewables
Portfolio Standard Program (Article 16 (commencing with Section
399.11) of Chapter 2.3 of Part 1 of Division begin delete 1). end delete begin insert 1 of the Public
Utilities Code). end insert

begin delete

(7)

end delete

begin insert (8) end insert  “Women business enterprise” means a business enterprise
that is at least 51 percent owned by a woman or women, or, in the
case of any publicly owned business, at least 51 percent of the
stock of which is owned by one or more women, and whose
management and daily business operations are controlled by one
or more of those individuals.

(b) (1) The commission shall develop an outreach program to
inform begin delete and recruit end delete the most qualified loan and grant applicants,
and contractors, including, but not limited to, women, minority,
disabled veteran, and LGBT business enterprises. The purpose of
the program is to ensure that the commission recognizes the
demographic shifts of the California marketplace and is nurturing
the new and next generation of energy technology leaders.

(2) One component of the outreach program shall be a process
for tracking the diversity of contractors, loan recipients, and grant
recipients. begin delete Among other activities, the commission shall identify end delete
begin insert The commission may rely on end insert existing sources for locating
information on certified women, minority, disabled veteran, and
LGBT business, which may include, but is not limited to, the
clearinghouse database maintained by the Public Utilities
Commission, the list of Disabled Veteran Business Enterprises
certified by the Procurement Division of the Department of General
Services, as well as information on other nonprofit organizations
that verify or certify women, minority, and LGBT business
enterprises.

(3) The begin delete commission shall include end delete begin insert outreach program shall
include a strategy to inform end insert certified women, minority, disabled
veteran, and LGBT business enterprises begin delete in announcements end delete about
workshops, trainings, and funding opportunities, as appropriate,
and shall consider including them in capacity building activities.

(c) The commission shall require that each contractor, recipient
of a grant awarded, or loan approved by the commission on or
after begin delete October 1, 2016, end delete begin insert July 1, 2017, end insert for an amount of one million
dollars ($1,000,000) or more, begin insert or a different threshold or criteria
determined to be appropriate by the commission, end insert including
amended contracts, loans, and grant agreements that bring the total
value of the contract, loan, or grant to one million dollars
($1,000,000) or more begin insert , or the alternative thresh end insert begin insert old amount set by
the commission end insert , do all of the following as a condition for the
receipt of that grant or loan:

(1)  begin delete Report end delete begin insert Submit a report to the commission end insert on the
demographic makeup of the management of the firm or
organization awarded the contract or receiving the grant or loan.

(2) Submit a detailed begin delete and verifiable end delete outreach plan begin insert to the
commission end insert for increasing subcontractor opportunities with the
prime contractor, grantee, or borrower by certified women,
minority, disabled veteran, and LGBT business enterprises begin insert in
California end insert pursuant to the requirements of this section.

(3) Implement the outreach plan submitted to the commission
to the best of the contractor’s or recipient’s financial and
administrative capacity.

(4) Furnish a report to the commission regarding the activities
and outcomes achieved in implementing the outreach plan, pursuant
to the requirements of this section.

(d) Each report required by this section shall be a public
document and shall be made readily available on an Internet Web
site maintained by the commission.

(e) (1) The commission shall establish guidelines for all
contractors, grant recipients, and loan recipients, subject to
subdivision (c), to utilize in preparing, implementing, and reporting
on the outreach plans pursuant to this section.

(2) The guidelines shall include methods for begin delete encouraging end delete
contractors, grant recipients, and loan recipients begin insert to use end insert to engage
certified women, minority, disabled veteran, and LGBT business
enterprises in subcontracts in all categories that provide
subcontracting opportunities, including, but not limited to,
renewable energy projects, advanced technologies, and
demonstration projects.

begin delete

(3) The commission shall consider specifying consequences for
not meeting the requirements of subdivision (c).

end delete begin delete

(4)

end delete

begin insert (3) end insert  The guidelines shall integrate the existing reporting
requirements for state contractors, as relevant, and shall not require
duplicate reporting of data that is otherwise required by state law.
The contractor or loan or grant recipient may submit reports of
another state entity to provide the same information.

begin insert

(4) The commission shall adopt the guidelines at a publicly
noticed meeting and shall provide an opportunity for public
comment. The commission shall provide written public notice of
a meeting not less than 30 days prior to the meeting. For
substantive revisions of the guidelines, the commission shall
provide written notice of a meeting not less than 10 days prior to
the meeting at which the revision is to be considered or adopted.
The adoption or revision of guidelines pursuant to this subdivision
is exempt from Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code.

end insert

(f) (1) Each recipient of a loan or grant, or contract, subject to
this section, shall submit the outreach plan described in subdivision
(c) within 60 days of the begin delete award or end delete approval of the loan, grant, or
contract.

(2) The outreach plan shall include short- and long-term goals
and timetables, but not quotas, and shall include methods the
contractor, grant recipient, or loan recipient intends to use to
increase the number of certified women, minority, disabled veteran,
and LGBT business enterprises that participate in all categories of
subcontracting opportunities, including, but not limited to,
renewable energy projects, advanced technologies, and
demonstration projects.

(3) The outreach plan may be updated, as necessary, to reflect
changes in the marketplace, local conditions, changes in the
structure of the firm or organization, and other issues impacting
the effectiveness of the plan.

(g) Each contractor and recipient of a grant or loan subject to
this section shall submit data begin delete on a form provided end delete begin insert in a format to be
specified end insert by the commission of the activities and outcomes of its
outreach plan on October 1 of the following fiscal year in which
the begin delete contract was awarded, the loan was approved, or the grant was
received. end delete begin insert contract, grant, or loan was awarded. end insert

(h) After receipt of the initial plans and reports, the commission
shall consider establishing a Diversity Task Force to consider and
make recommendations about diversity in the energy industry,
including diversity of corporate governing boards and procurement
from diverse begin delete businesses. If the commission establishes a Diversity
Task Force, the commission shall consider how it can address and
promote local and targeted hiring. end delete begin insert businesses, and addressing and
promoting local and targeted hiring. end insert