Amended in Assembly April 12, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2690


Introduced by Assembly Member Ridley-Thomas

February 19, 2016


An act to amend Section 130232 of the Public Utilities Code, relating to transportation.

LEGISLATIVE COUNSEL’S DIGEST

AB 2690, as amended, Ridley-Thomas. Los Angeles County Metropolitan Transportation Authority: contracting.

Existing law creates the Los Angeles County Metropolitan Transportation Authority (LACMTA), with various powers and duties with respect to transportation planning, programming, construction, and operations.

Existing law authorizes LACMTA to provide for a small business preference of 5% of the lowest responsible bidder meeting specifications, with respect to contracts in construction, the construction component of a design-build team, the procurement of goods, or the delivery of services. Existing law also authorizes LACMTA to establish a subcontracting participation goal for small businesses on certain contracts financed with nonfederal funds and to grant a preference of 5% to the lowest responsible bidders that meet that goal.

This bill would also authorize LACMTA to establish disabled veteran business enterprise participation goals, and would define “disabled veteran business enterprise” for these purposes.

Existing law imposes various requirements on bidders relative to contracts involving small business enterprise goals.

This bill would delete those requirements and instead authorize LACMTA to require bidders to comply with small business enterprise and disabled veteran business enterprise goals and requirements established by LACMTA relative to contracts financed with nonfederal funds. The bill would also authorize LACMTA to award contracts under certain circumstances to small business enterprises with respect to work that is set aside for competition among certified small businessbegin delete enterprises.end deletebegin insert enterprises, and would require the authority to report to the Legislature by December 31, 2017, regarding any contracts awarded in this regard.end insert

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

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

P2    1

SECTION 1.  

Section 130232 of the Public Utilities Code is
2amended to read:

3

130232.  

(a) Except as provided in subdivision (f), purchase
4of all supplies, equipment, and materials, and the construction of
5all facilities and works, when the expenditure required exceeds
6twenty-five thousand dollars ($25,000), shall be by contract let to
7the lowest responsible bidder. Notice requesting bids shall be
8published at least once in a newspaper of general circulation. The
9publication shall be made at least 10 days before the date for the
10receipt of the bids. The commission, at its discretion, may reject
11any and all bids and readvertise.

12(b) Except as provided for in subdivision (f), whenever the
13expected expenditure required exceeds one thousand dollars
14($1,000), but not twenty-five thousand dollars ($25,000), the
15commission shall obtain a minimum of three quotations, either
16written or oral, that permit prices and terms to be compared.

17(c) Where the expenditure required by the bid price is less than
18fifty thousand dollars ($50,000), the executive director may act
19for the commission.

20(d) All bids for construction work submitted pursuant to this
21section shall be presented under sealed cover and shall be
22accompanied by one of the following forms of bidder’s security:

23(1) Cash.

24(2) A cashier’s check made payable to the commission.

25(3) A certified check made payable to the commission.

P3    1(4) A bidder’s bond executed by an admitted surety insurer,
2made payable to the commission.

3(e) Upon an award to the lowest bidder, the security of an
4unsuccessful bidder shall be returned in a reasonable period of
5time, but in no event shall that security be held by the commission
6beyond 60 days from the date that the award was made.

7(f) The following provisions apply only to the Los Angeles
8County Metropolitan Transportation Authority:

9(1) The contract shall be let to the lowest responsible bidder or,
10in the authority’s discretion, to the person who submitted a proposal
11that provides the best value to the commission on the basis of the
12factors identified in the solicitation when the purchase price of all
13supplies, equipment, and materials exceeds one hundred fifty
14thousand dollars ($150,000). “Best value” means the overall
15combination of quality, price, and other elements of a proposal
16that, when considered together, provide the greatest overall benefit
17in response to requirements described in the solicitation documents.
18The contract shall be let to the lowest responsible bidder when the
19purchase price of the construction of all facilities exceeds
20twenty-five thousand dollars ($25,000).

21(2) The authority shall obtain a minimum of three quotations,
22either written or oral, that permit prices and terms to be compared
23whenever the expected expenditure required exceeds three thousand
24dollars ($3,000), but not one hundred fifty thousand dollars
25($150,000).

26(3) The authority may purchase supplies, equipment, and
27materials from a public auction sale, including public auctions
28held via the Internet, using the procedures established for all other
29participants in the public auction.

30(4) The authority may participate in a procurement agreement
31involving other public entities that is identified by a procuring
32public entity or entities as a cooperative procuring agreement from
33which other public entities may make purchases or enter into
34contracts, and the authority may procure, and enter into contracts
35for, items purchased pursuant to that procurement agreement,
36notwithstanding that the authority may not be the procuring public
37entity, provided the procurement agreement is awarded or entered
38into by either of the following:

39(A) One or more public entities or an organization of public
40entities, which may include the authority.

P4    1(B) A federal, state, or local public entity.

2(5) (A) Notwithstanding any other provision of law requiring
3the authority to award contracts to the lowest responsible bidder,
4the authority may, except as to contracts for professional services
5involving private architectural, landscape architectural, engineering,
6environmental, land surveying, or construction management as
7defined in Sections 4525 and 4529.10 of the Government Code,
8do any of the following in facilitating contract awards with small
9business enterprises and disabled veteran business enterprises:

10(i) Provide for a small business preference in construction, the
11construction component of a design-build team, the procurement
12of goods, or the delivery of services. The preference to a small
13business shall be 5 percent of the lowest responsible bidder meeting
14specifications that provides for small business participation.

15(ii) Establish a subcontracting participation goal for small
16business enterprises on contracts financed with nonfederal funds
17and grant a preference of 5 percent to the lowest responsible bidders
18 who meet the goal.

19(iii) Require bidders, prior to the time bids are opened, to comply
20with the small business enterprise and disabled veteran business
21enterprise goals and requirements established by the authority on
22contracts financed with nonfederal funds.

23(iv) In awarding contracts to the lowest responsible bidder,
24award the contract to the lowest responsible bidder meeting the
25small business enterprise and disabled veteran business enterprise
26goals.

27(v) Set aside work for competition among certified small
28business enterprises and award a contract to the lowest responsible
29bidder whenever the expected expenditure required exceedsbegin delete threeend delete
30begin insert five end insertthousand dollarsbegin delete ($3,000)end deletebegin insert ($5,000)end insert but is less thanbegin delete a threshold
31amount established by the authority,end delete
begin insert three million dollars
32($3,000,000),end insert
as long as price quotations are obtained by the
33authority from three or more certified small business enterprises.
34
begin insert If the authority awards contracts under this clause, tend insertbegin inserthe authority,
35for purposes of legislative oversight, shall, on or before December
3631, 2017, prepare and submit a report to the Legislature regarding
37 contracts awarded pursuant to this clause. The report shall be
38submitted in compliance with Section 9795 of the Government
39Code.end insert

begin delete

P5    1(vi) Set aside work for competition among certified small
2business enterprises and award a contract to the lowest responsible
3bidder whenever the expected expenditure required exceeds the
4authority’s threshold amount in clause (v) but is less than five
5million dollars ($5,000,000), as long as price quotations are
6obtained by the authority from three or more certified small
7business enterprises.

end delete

8(B) A small business enterprise recommended for a contract
9award through use of a set aside shall be performing a
10commercially useful function. A small business enterprise shall
11be presumed to be performing a commercially useful function if
12it performs and exercises responsibility of at least 30 percent of
13the total cost of the contract work with its own workforce.

14(C) “Small business enterprise” as used in this paragraph, means
15a business enterprise that is classified as a small business under
16United States Small Business Administration rules and meets the
17current small business enterprise size standards found in Part 121
18of Title 13 of the Code of Federal Regulations appropriate to the
19type of work the enterprise seeks to perform. The authority may
20establish limitations regarding the average annual gross receipts
21of a small business over the previous three fiscal years and establish
22limitations regarding the personal net worth of the owner of the
23small business, exclusive of the value of the owner’s personal
24residence.

25(D) “Disabled veteran business enterprise” as used in this
26paragraph has the meaning as defined in Section 999 of the Military
27and Veterans Code.

28(E) “Goal” as used in this paragraph means a numerically
29expressed objective that bidders are required to achieve.



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