BILL ANALYSIS Ó
SB 1170
Page 1
Date of Hearing: June 29, 2016
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Susan Talamantes Eggman, Chair
SB
1170 (Wieckowski) - As Amended May 31, 2016
SENATE VOTE: 36-1
SUBJECT: Public contracts: water pollution prevention plans:
delegation.
SUMMARY: Prohibits local public agencies, including charter
cities, from requiring contractors to develop, or assume
responsibility for the completeness and accuracy of, plans to
prevent or reduce water pollution or runoff on public works
projects. Specifically, this bill:
1)Defines "plan" to mean a stormwater pollution prevention plan
(SWPPP), water pollution control program, or any other plan
required by a regional water quality control board to prevent
or reduce water pollution or runoff on a public works project,
pursuant to State Water Resources Control Board (State Water
Board) Order No. 2009-0009-DWQ.
2)Defines "plan developer" to mean a qualified stormwater
pollution prevention plan developer (QSD) or a qualified
stormwater pollution prevention plan practitioner (QSP), as
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those terms are defined in Appendix 5 of State Water Board
Order No. 2009-0009-DWQ.
3)Prohibits a public entity, charter city, or charter county
from delegating to a contractor the development of a plan on a
public works contract.
4)Exempts state agencies from 3), above.
5)Provides that 3), above, shall not apply to a contract for
architectural or engineering services relating to the
development of a plan on a public works contract.
6)Provides that this bill's provisions do not restrict a public
entity, charter city, or charter county from contracting with
a duly licensed architect or engineer for the design of a
plan.
7)Prohibits a public entity, charter city, or charter county
from requiring a contractor on a public works contract that
includes compliance with a plan to assume responsibility for
the completeness and accuracy of the plan developed by that
entity.
8)Provides that 3) through 7), above, shall apply to all public
works contracts, except contracts that use design-build (DB),
best value or construction manager at risk procurement
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methods, if the contractor or construction manager at risk is
required by the bid or procurement documents to retain a plan
developer for the project owners.
9)Provides that nothing in this bill shall be construed to
prohibit a local public entity, charter city, or charter
county from requiring a bidder or contractor on a public works
contract to review any applicable plan and report any errors
or omissions noted to the public entity or its plan developer.
The review by the contractor shall be limited to the
contractor's capacity as a contractor and not as a licensed
design professional or plan developer.
10) Finds and declares
that it is of statewide concern to require a public entity,
charter city, or charter county to be responsible for the
development of, and completeness and accuracy of, a plan to
prevent or reduce water pollution or runoff on a public works
project.
11) States that the
addition to the Public Contract Code made by this bill does
not constitute a change in, but is declaratory of, existing
law, as specified.
12) Finds that there is no mandate contained in this bill that
will result in costs incurred by a local agency or school
district for a new program or higher level of service, which
require reimbursement, pursuant to Section 6 of Article XIIIB
of the California Constitution and Part 7 (commencing with
Section 17500) of Division 4 of Title 2 of the Govern13)ment
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Code.
EXISTING LAW:
1)Regulates the discharge of pollutants in stormwater associated
with construction activity to waters of the United States from
construction sites that disturb one or more acres of land
surface, or that are part of a common plan of development or
sale that disturbs more than one acre of land surface.
2)Requires the State Water Board and the nine California
Regional Water Quality Control Boards (Regional Boards) to
prescribe waste discharge requirements in accordance with the
federal National Pollutant Discharge Elimination System
(NPDES) permit program established by the federal Clean Water
Act and California's Porter-Cologne Water Quality Control Act.
3)Regulates NPDES permit requirements under a General
Construction Permit (Permit) via the State Water Board's
Order.
4)Prohibits a local public entity, charter city, or charter
county from requiring a bidder on a public works contract to
assume responsibility for the completeness and accuracy of
architectural or engineering plans and specifications on
public works projects, except as specified.
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FISCAL EFFECT: According to the Senate Appropriations
Committee, "Unknown significant local costs to cities, counties,
special districts, and school districts, potentially
reimbursable by the state General Fund. To the extent the
Commission on State Mandates finds that the bill imposes a
higher level of service, and identifies local costs that are
subject to reimbursement, this bill could result in significant
General Fund costs." See comment 7), below, regarding this
bill's mandate/reimbursement language.
COMMENTS:
1)Bill Summary. This bill prohibits local public agencies,
including charter cities, from delegating to a contractor the
development of a SWPPP, a water pollution control program, or
any other plan required by a Regional Board to prevent or
reduce water pollution or runoff on a public works project.
This bill also prohibits public agencies from requiring a
contractor on a public works contract that requires compliance
with any of these plans to assume responsibility for the
completeness and accuracy of the plan developed by that
entity. This bill exempts state agencies from its
requirements, as well as projects that use DB, best value, and
construction manager at risk procurement methods.
This bill states that it is of statewide concern to require a
public entity, charter city, or charter county to be
responsible for the development of, and completeness and
accuracy of, a plan to prevent or reduce water pollution or
runoff on a public works project, and states that it is
declaratory of existing law. It also finds that there is no
state-mandated local cost contained in the bill. This bill is
sponsored by the Associated General Contractors.
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2)Background. In 1948, Congress passed the first version of the
Federal Water Pollution Control Act, or the Clean Water Act.
The NPDES was amended into the Act in 1972, with a focus on
point sources of pollution, such as sewage treatment and
wastewater from industrial and manufacturing facilities.
After 1972, studies began showing that non-point sources,
including stormwater runoff, were a major contributor to
surface water pollution. This led to further amendments to
the Act that created a framework for regulating stormwater.
In 1990, the U.S. Environmental Protection Agency published
final regulations establishing permit requirements for
stormwater discharges associated with industrial activities,
including construction activities. California's first Permit
was adopted in 1992. The latest Permit, which is regulated by
the State Water Board's Order, became effective July 1, 2010.
Owners of construction projects that disturb one or more acres
of land must comply with the Permit, which regulates the
discharge of stormwater and non-stormwater (i.e., improper
dumping, spills, leakage from storage tanks) from certain
construction activities and is enforced by California's nine
Regional Boards. The Permit requires, among other things, the
development of a site-specific SWPPP that demonstrates
compliance with the Permit.
A SWPPP is a comprehensive, detailed, site-specific, written
document that identifies potential sources of stormwater
pollution on a construction site; describes stormwater control
measures and Best Management Practices (BMPs) that will be
used to reduce or eliminate pollutants in stormwater
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discharges from the project site; and, identifies the
procedures the operator of the project site will implement to
comply with the terms and conditions of the Permit.
SWPPPs are ever-changing documents. In order for a
construction site to remain in compliance with the Clean Water
Act's NPDES permitting program, a SWPPP must be developed and
maintained throughout the entire construction project. As the
project progresses and goes through changes, the SWPPP must be
revised to reflect those changes. The SWPPP is comprised of
site maps, BMP details, inspection reports, spill reports,
corrective action logs and associated waivers.
A project's SWPPP may be furnished by the project owner or
prepared by a contractor's SWPPP developer.
3)Who Develops the SWPPP? The Permit requires SWPPPs to be
prepared and certified by a QSD. Many other SWPPP tasks (i.e.
inspections) must be conducted directly by, or under the
supervision of, a QSD or QSP. There are extensive
qualification and training requirements for both the QSD and
QSP. To become a QSD or a QSP, a person must complete a
training course offered by a qualified California Construction
General Permit Trainer of Record, pass an exam, and register
and be certified by the California Stormwater Quality
Association. In addition, each qualification requires an
underlying pre-registration or pre-certification.
To become a QSD, a person must be one of the following:
Registered Civil Engineer; Registered Professional Geologist;
Registered Landscape Architect; Registered Professional
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Hydrologist; Certified Professional in Erosion and Sediment
Control (CPESC); Certified Professional in Storm Water Quality
(CPSWQ); or, Professional in Erosion and Sediment Control
registered through the National Institute for Certification in
Engineering Technologies.
To be a QSP, one must be a QSD or be one of the following:
Certified Erosion, Sediment, and Storm Water Inspector
(CESSWI) or a Certified Inspector of Sediment and Erosion
Control (CISEC).
4)Responsibility and Consequences. The Permit defines the
"discharger" as "[t]he Legally Responsible Person or entity
subject to the General Permit." The Permit defines the
Legally Responsible Person as falling into specified eligible
categories, including "[a] person, company, agency or other
entity that possesses a real property interest. . . .in the
land upon which the construction or land disturbance
activities will occur for the regulated site." The Permit
states a contractor is not qualified to be the Legally
Responsible Person, unless they fall into limited categories
(those employed and duly authorized on U.S. Army Corp of
Engineers Projects or those engaged in pollution and
remediation projects).
The Permit is typically held in the name of the property
owner. Consequently, the party required to ensure compliance
with the Permit is the property owner, not the contractor.
The Permit also requires the discharger (i.e., owner) to file
Permit registration documents, annual reports and other
compliance information. The discharger must certify that the
information provided regarding the project site is accurate
and complete. The discharger must allow entry to the project
site for inspections and provide records required to be kept
under the Permit.
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There are serious potential costs for failure to comply with
the Permit. Any person who violates a condition of the Permit
is subject to a civil penalty, which could be as high as
$37,500 per calendar day of a violation, plus sanctions
provided by the Clean Water Act.
5)Author's Statement. According to the author, "Local agencies
have begun requiring contractors to prepare the state required
storm water plan and submit it as part of the bid. At this
point the contractor or subcontractor cannot price the storm
water plan because it hasn't been designed yet - so the result
is the contractor or subcontractor is forced to estimate the
cost of implementing a storm water plan - and include that
cost into a bid - even before the plan has been designed.
This shift in responsibility: (1) undermines the intent of the
Permit; (2) results in an inefficient allocation of
responsibility and risk; and (3) is contrary to several
existing laws.
"This bill ensures that adequate resources are allocated to
the pollution prevention planning process by clarifying that
public owners are responsible for the preparation of
Stormwater Pollution Prevention Plans ('SWPPP') required on
public works projects. The bill prohibits public owners from
delegating responsibility to contractors for SWPPP design.
Additionally, the bill clarifies existing law which requires
licensed design professionals to create engineering and
architectural plans. Existing law already bars public owners
from making contractors assume responsibility for the design
of stormwater plans. The bill also clarifies and codifies the
intent of the permit designation of project owners as the
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Legally Responsible Party."
The sponsors of this bill indicate that they are unaware of
any litigation being brought as a result of local agency
practices, and are seeking a legislative solution, instead.
6)Contracting Agencies' Perspective. According to staff at the
State Water Board, the practice of delegating development of a
SWPPP to the contractor is neither new nor unusual. This is
frequently the practice they see in construction projects that
must obtain a Permit and develop a SWPPP. They note that the
discharger, or the responsible party for the Permit, is named
on the Permit and is always the owner/agency, not the
contractor. Thus, responsibility for compliance with the
Permit remains with the owner/agency, regardless of which
party develops the SWPPP.
State Water Board staff also assert that most municipalities
don't have the expertise to develop SWPPPs and don't have the
resources to retain QSDs on staff. QSDs are typically
employed by environmental consulting firms that perform the
work of developing SWPPPs under contract, either with a
contractor (which is more common), or with the owner/agency.
(Some large contracting firms keep QSDs on staff, but many
smaller firms also don't have the resources to do so.)
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Local contracting agencies indicate that they often require
contractors to design and submit SWPPPs because a contractor's
plan or approach for construction dictates the sequence of
excavation, backfill, and temporary stockpiling of material on
a typical project. They contend that a contractor-designed
SWPPP can incorporate an optimal construction sequence
selected by the contractor and incorporate it into their
SWPPP, thereby maximizing efficiency and reducing costs.
An owner-designed SWPPP would necessarily have to assume a
sequence of excavation, etc. (and effects upon drainage) that
might occur under one construction sequence/scenario. This
might not be the optimum sequence that the contractor would
elect to use (and would have incorporated into its own SWPPP
plan). For this reason, it makes more sense to require the
party actually responsible for the construction sequence of
operations to be the one implementing its sequence into the
design of a SWPPP. An owner-designed SWPPP would
unnecessarily lock in all bidders to one single type of
construction sequence/plan envisioned by the owner prior to
the bid opening, one that might not necessarily be the lowest
cost option.
7)State Mandate/Reimbursement Language. This bill finds that
there is no mandate contained in the bill that will result in
costs incurred by a local agency or school district for a new
program or higher level of service that require reimbursement.
However, the Senate Appropriations Committee noted the
following in its analysis of this bill: "By prohibiting a
public agency from requiring a contractor on a
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design-bid-build project to develop a SWPPP or assuming
responsibility for completeness and accuracy of a plan, this
bill effectively forces the public agency to prepare a SWPPP
in-house, or to contract with another entity to perform those
functions, prior to soliciting bids for the construction of a
project?SB 1170 would shift full legal responsibility for
construction project water quality, and make public entities
responsible for violations of permit requirements, even if the
contractor was at fault for a discharge.
"Local agencies would likely?incur additional costs on public
works projects...Some of these costs would be mitigated by
lower bids on construction contracts since contractors would
not include costs to prepare a SWPPP in their bids, which are
typically marked up to mitigate risk factors. However, these
costs and additional risk and liability factors would be
shifted from the contractor to the local agency. Whether any
increased local costs would be subject to reimbursement from
the state is unknown, and subject to a determination by the
Commission on State Mandates that the bill's requirements
constitute a higher level of service. Staff notes that the
California Supreme Court has opined that 'simply because a
state law or order may increase the costs borne by local
government in providing services, this does not necessarily
establish that the law or order constitutes an increased or
higher level of the resulting service to the public under
article XIII B, section 6, and Government Code section 17514.'
(San Diego Unified School Dist. V. Commission on State
Mandates (2004) 33 Cal.4th 859, 877).
"Staff notes that while the bill includes a legislative
finding that it contains no mandate that will result in costs
incurred by a local agency or school district for a new
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program or higher level of service which require
reimbursement, the Legislature cannot limit a constitutional
right to reimbursement through a finding that an act does not
impose a mandate. The Commission on State Mandates has cited
several decisions where the courts have determined that the
evidence contradicts what is in statute. For example, the
courts noted in Carmel Valley Fire Protection District v.
State of California (1987) 190 Cal.App. 3rd 521, 541, that the
Legislature itself concluding that costs are not reimbursable
through findings, disclaimers, and control language is a
'transparent attempt to do indirectly that which cannot
lawfully be done directly.' In addition, in Long Beach
Unified School District v. State of California (1990) 225
Cal.App. 3rd 155, 184, the courts noted, in reference to a
finding by the Legislature that an Executive Order does not
impose a state mandated local program, that unsupported
legislative disclaimers are insufficient to defeat a
constitutional right to reimbursement.
"To the extent the Commission finds that the bill imposes a
higher level of service, and identifies local costs that are
subject to reimbursement, this bill could result in
significant General Fund costs."
8)Previous Legislation. AB 1315 (Alejo) of 2015 was similar to
this bill, but AB 1315 did not exempt state agencies or
contracts using alternate procurement methods, did not specify
it was declaratory of existing law, and did not include
language finding that there was no mandate in the bill. AB
1315 was held in the Assembly Appropriations Committee.
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9)Arguments in Support. The Associated General Contractors,
sponsor of this measure, write, "SB 1170 ensures that adequate
resources are allocated to the pollution prevention planning
process by clarifying that local agencies are responsible for
the preparation of Stormwater Pollution Prevention Plans
('SWPPP') required on public works projects.
SB 1170 prohibits local agency owners from delegating
responsibility to contractors to assume responsibility for
SWPPP design.
"Some local agencies have raised objections to SB 1170,
claiming that shifting stormwater responsibility to
contractors are a longstanding practice under the revised
sormwater permit process. This is not true. The State
Construction Permit was updated in 2009 by the State Water
Resources Control Board and took effect July 1, 2010. Among
the many changes, the State Board adopted the 2006 Blue Ribbon
Panel of Experts recommendation to develop specific and
appropriate training of Storm Water Pollution Prevention Plan
(SWPPP) personnel. A qualified SWPPP Developer (QSD)
certification is required to design and certify a SWPPP. A
Qualified SWPPP Practitioner (QSP) certification is overseeing
of actual infield SWPPP implementation. This was not required
prior to 2010, just five and a half years ago - hardly a long
standing time frame.
"Also, contrary to arguments by the local agencies, the
contractor is not in the best position to design the
stormwater plan. An owner's QSD is best suited to design a
robust SWPPP given a better understanding of the local
topography, hydrology and site. Most projects are planned and
designed over a period of 12 months or more. This process
includes a geology and hydrology study, and civil engineering
of storm drain systems to carry and control runoff. This
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robust planning and design process is when the SWPPP is best
prepared.
SB 1170 makes it so."
10)Arguments in Opposition. The Association of California
Healthcare Districts, the Association of California School
Administrators, the Association of California Water Agencies,
the California Association of School Business Officials, the
California Association of Sanitation Agencies, the California
Municipal Utilities Association, the California School Boards
Association, the California Special Districts Association, the
California State Association of Counties, the California State
University, the Coalition for Adequate School Housing, the
League of California Cities, the Rural County Representatives
of California, the Three Valleys Municipal Water District, and
Urban Counties of California, in opposition to this bill,
state, "SWPPPs must be written, amended and certified by
qualified personnel who are knowledgeable in the principles
and practice of erosion and sediment controls and possess the
skills needed to assess conditions at the construction site
that could impact stormwater quality. Public agencies rely on
the expertise of qualified SWPPP developers, known as QSDs, to
conduct this work, as agencies do not have the resources nor
the regular workload required to employ such personnel
throughout the year.
"SWPPPs are currently created in accordance with the general
contractor's construction plans. As construction progresses,
SWPPPs must often be modified to accommodate the constantly
changing conditions of a construction site. The general
contractor is in the best position to create the construction
plan and contract for the corresponding SWPPP. A general
contractor-developed SWPPP can incorporate an optimal
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construction sequence selected by the contractor, thereby
maximizing efficiency and reducing costs.
"SB 1170 would turn this standing process on its head by
prohibiting public agencies from contracting with the general
contractor to develop a SWPPP and statutorily restricting
their remaining options to an engineer or architect. A
separate entity developing a SWPPP would have to assume a
sequence of work that might occur under one construction
scenario but not another. Public agencies, engineers and
architects simply do not have the direct control over the
day-to-day construction, let alone the expertise, to perform
this function.
"Ultimately, the success or failure of a SWPPP lies with the
general contractor carrying out the plan. If the Legislature
statutorily shifts the development and liability of the SWPPP
to the public agency, or to a design professional or
architect, it will create confusion and conflict within the
public works process. SB 1170 will only further disconnect
the entity responsible for the development of the SWPPP from
the entity that performs the work related to the SWPPP. This
is akin to asking the public agency or design professional to
separately plan and contract for the security of the general
contractor's equipment on the job site, the number of portable
restrooms needed or any other function that is intimately
connected to the performance and sequence of a construction
project."
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REGISTERED SUPPORT / OPPOSITION:
Support
Associated General Contractors [SPONSOR]
California Chapters of the National Electrical Contractors
Association
California Legislative Conference of the Plumbing, Heating and
Piping Industry
California Precast Concrete Association
California Professional Association of Specialty Contractors
California State Council of Laborers
Norther California Allied Trades
United Contractors
Wall and Ceiling Alliance
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Opposition
Association of California Healthcare Districts
Association of California School Administrators
Association of California Water Agencies
California Association of Sanitation Agencies
California Association of School Business Officials
California Municipal Utilities Association
California School Boards Association
California Special Districts Association
California State Association of Counties
California State University
Cities of Camarillo and Laguna Hills
City and County of San Francisco
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Coachella Valley Water District
Coalition for Adequate School Housing
Counties of Contra Costa, San Diego, San Joaquin and Yuba
League of California Cities
Rural County Representatives of California
San Francisco Public Utilities Commission
Santa Clara Valley Water District
Three Valleys Municipal Water District
Urban Counties of California
Western Placer Waste Management Authority
Analysis Prepared by:Angela Mapp / L. GOV. / (916)
319-3958
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