BILL ANALYSIS Ó
SB 682
Page 1
SENATE THIRD READING
SB
682 (Leno)
As Amended August 31, 2015
Majority vote
SENATE VOTE: 24-14
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Judiciary |7-3 |Mark Stone, Alejo, |Wagner, Gallagher, |
| | |Chau, Chiu, Cristina |Maienschein |
| | |Garcia, Holden, | |
| | |O'Donnell | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |12-5 |Gomez, Bloom, Bonta, |Bigelow, Chang, |
| | |Calderon, Nazarian, |Gallagher, Jones, |
| | |Eggman, Eduardo |Wagner |
| | |Garcia, Holden, | |
| | |Quirk, Rendon, Weber, | |
| | |Wood | |
| | | | |
| | | | |
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SB 682
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SUMMARY: Requires courts to comply with specified requirements
before contracting out services that are currently or
customarily performed by a trial court's employees.
Specifically, this bill:
1)Provides that contracts for services currently or customarily
performed by trial court employees are permissible if all of
the following conditions are met:
a) The court clearly demonstrates that the proposed
contract will result in actual, overall cost savings to the
court, considering specified factors, as provided;
b) The contract may not be approved solely on the basis
that savings will result from lower contractor pay rates or
benefits, provided the contract is eligible for approval if
the contractor's wages are at the industry standard and do
not significantly undercut trial court pay rates;
c) The contract does not cause displacement of court
employees, as provided;
d) The contract savings are large enough to ensure they
will not be lost by various cost fluctuations during the
contract period;
e) The amount of the savings justifies the size and
duration of the contract;
f) The contract is awarded through a competitive bidding
process;
g) The contract provides for qualified staff, and the
contractor's hiring practices are nondiscriminatory;
h) The potential for future economic risk to the court from
future contract rate increases is minimal;
i) The contract is with a firm, as defined;
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j) The potential economic advantage of contracting out is
not outweighed by the public's interest in having the
function performed directly by the court; and
aa) The contract complies with any additional requirements
imposed by the Judicial Branch Contracting Manual.
2)Does not preclude a trial court or the Judicial Council from
adopting more restrictive rules regarding contracting of court
services.
3)Contracting is also permissible if one of the following
conditions is met:
a) Contract is for a new trial court function for which the
Legislature has specifically authorized the performance of
the services by independent contractors;
b) Contract is between a trial court and another trial
court or a government entity for services to be performed
by employees of that trial court or government entity;
c) Services contracted for cannot be satisfactorily
performed by court employees or are of such a highly
specialized or technical nature that necessary expertise
cannot be obtained from court employees;
d) Services are incidental to a contract for purchase of
property, except for contracts to operate equipment or
computers (other than service or maintenance agreements);
e) Contract is needed to protect against conflict of
interest or ensure independent unbiased findings;
f) Emergency situations in which contract is necessary for
immediate preservation of public health, welfare or safety;
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g) Training courses when qualified instructors are not
available from court employees;
h) Contractor will provide equipment, materials, facilities
or support services that cannot feasibly be provided in the
location, except these will not be used to open closed
courthouses or for ongoing operation at new or reopened
courthouses;
i) Services are of such an urgent, temporary or occasional
nature that delay in hiring employees would frustrate their
very purpose, but this provision does not apply to court
reporters, except individual pro tempore court reporters
may be used as appropriate;
j) Contract is for services with individuals with
developmental disabilities pursuant to rehabilitation
programs;
aa) Contract is for services of court interpreters; or
bb) Contract is for services provided to a court by a
traffic assistance program.
4)Contains a severability clause.
EXISTING LAW:
1)Provides that employees of the state be appointed through the
civil service system.
2)Limits personal service contracts (contracting out) for work
done by state employees to when specified conditions are
satisfied, including:
a) The contracting state agency clearly demonstrates actual
overall savings;
b) The contract savings are not the result of lower
SB 682
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contractor pay rates or benefits, provided the contract is
eligible for approval if the contractor's wages are at the
industry standard and do not undercut existing pay rates;
c) The contract does not cause displacement of state civil
service employees;
d) The amount of the savings clearly justifies the
agreement;
e) The contract is awarded through a competitive bidding
process;
f) The potential for future economic risk for the state
from the contractor is minimal; and
g) The potential economic advantage of contracting out is
not outweighed by the public's interest in having a
particular function performed directly by the state.
3)Permits contracting out of work done by state employees in
limited specified situations, including new state functions,
services that cannot be performed within civil service, and
emergency situations.
4)Prevents a school district or community college district from
contracting out services currently or customarily performed by
classified employees, unless conditions similar to those set
out in 2), above, are satisfied.
5)Prevents, until January 1, 2019, a city or library district
from withdrawing from a county free library system and
operating libraries with a private contractor, unless
conditions similar to 2), above, are satisfied.
6)Allows a county to contract out for "special services," as
provided.
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FISCAL EFFECT: According to the Assembly Appropriations
Committee:
1)Unknown, significant costs, potentially in the millions of
dollars (General Fund), to the extent the standards
established in this bill limit the courts' ability to
negotiate contracts for services and to renew or extend
existing contracts. (Based on a survey of the courts, the
Judicial Council estimates increased costs of $25 million to
hire employees for work currently performed by contract
staff.)
2)Offsetting a portion of the above costs will be savings in
cases where the decision to continue or resume performing
functions with court employees is more cost effective.
3)Unknown, significant loss of future savings, potentially in
the millions of dollars (General Fund) annually, to the extent
this bill restricts the ability of courts to transition to
technology-based services for existing court services.
COMMENTS: Nearly all government entities in California are
restricted from contracting out functions that are customarily
done by public employees, unless specified conditions are
satisfied. These requirements are designed to ensure not only
that work is done cost-effectively, but also that the public
interest in government activities remains paramount. As a
general rule, work performed for the state must be done by state
employees, unless the proposed contract for personal services
meets specified criteria, including a clear demonstration of
cost savings. Schools, community college districts and public
libraries are also required to comply with generally the same
standards that apply to the state. This bill, jointly sponsored
by SEIU, AFSCME, Laborers' Locals 777 and 792, and the Orange
County Employees Association, seeks to extend these same due
diligence protections to the trial courts.
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Under this bill, if a trial court intends to privatize a
function that is currently or customarily performed by trial
court employees, the court must first satisfy certain due
diligence requirements. The due diligence requirements in this
bill are, almost verbatim, identical to requirements in current
law that apply to all state agencies, as well as schools,
community colleges and libraries. In order to ensure that the
trial courts can operate effectively, the bill provides twelve
exemptions to permit contracting out of court services without
having to go through the due diligence review outlined above,
which are similar to exemptions provided to some other
government entities.
Last year, AB 2332 (Wieckowski), which was similar to this bill,
passed the Assembly and the Senate Judiciary Committee, but was
held on the Senate Appropriations Committee suspense file. In
2013, the Governor vetoed AB 566 (Wieckowski), which also was
similar to this bill. This bill seeks to address the Governor's
concerns -- and the issues last year in the Senate
Appropriations Committee - by increasing the exemptions,
narrowing the scope of contracts to which the bill applies, and
making the requirements of the bill nearly identical to the
limitations that today apply to state agencies.
Analysis Prepared by:
Leora Gershenzon / JUD. / (916) 319-2334 FN:
0001627
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