BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 499
                                                                  Page  1


          ASSEMBLY THIRD READING
          AB 499 (Leno)
          As Amended May 10, 2005
          Majority vote 

           ECONOMIC DEVELOPMENT            5-0                             
           
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          |Ayes:|Arambula, Houston, Baca,  |     |                          |
          |     |Canciamilla, Garcia       |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Creates a five-year pilot project allowing the San  
          Francisco Community College District (District) to grant local  
          bidding preferences of up to 5% in the award of contracts to  
          small and local businesses and other businesses meeting  
          subcontracting goals.  Specifically,  this bill  :

          1)Stipulates the definition of the term "small business" in a  
            manner consistent with the current definition held by the  
            Department of General Services in regulations governing small  
            business contracts with the state. 

          2)Limits the District from self-defining the term "local" as  
            being a geographical area smaller than the boundaries of the  
            City and County of San Francisco and no greater than the area  
            comprising Alameda, Contra Costa, Marin, Napa, San Francisco,  
            San Mateo, Santa Clara, Solano, and Sonoma Counties.

          3)Requires the District to provide an annual report to the  
            Legislative Analyst for each of the five years of the pilot  
            project, including specified data.  

           EXISTING LAW  :
           
           1)Allows local agencies to grant bidding preferences of up to 5%  
            in the award of specified contracts to local agency-defined  
            small businesses and other businesses meeting subcontracting  
            goals.

          2)Requires each local agency awarding the small business  
            preference to define the term small business.









                                                                  AB 499
                                                                  Page  2


           FISCAL EFFECT  :  Unknown

           COMMENTS :  There is no provision in current law that allows  
          local agencies to award geographically-based preferences such as  
          a local business preference.  This pilot project and the  
          reporting requirement therein seek to allow one local agency to  
          engage in such a practice and study the contract award results  
          and changes, if any, under such a practice. 
           

          Analysis Prepared by  :    Tom Higgins / J., E.D. & E. / (916)  
          319-2090   


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