BILL ANALYSIS
AB 677
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 677 (Solorio)
As Amended July 23, 2009
Majority vote
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|ASSEMBLY: |49-30|(June 2, 2009) |SENATE: |22-11|(August 18, |
| | | | | |2010) |
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Original Committee Reference: L. & E.
SUMMARY : Provides that specified work related to renewable
energy generation is considered "public works" for purposes of
prevailing wage law.
The Senate amendments specify that the work at issue:
1 May be located on property wholly or partially owned by a
school district or community college district, or on public
property.
2)Is performed in connection with a long-term arrangement for
the purchase of "partially or fully exported" power.
AS PASSED BY THE ASSEMBLY , this bill provided that "public
works" includes construction, alteration, demolition,
installation or repair work done under private contract when all
of the following conditions exist:
1)The work is performed in connection with the construction or
maintenance of renewable energy generation capacity
specifically to serve a school district or community college
district.
2)The work is performed in connection with a "long-term" (at
least five years) arrangement for the purchase of power by or
for the benefit of the school district or community college
district.
FISCAL EFFECT : According to the Senate Appropriations
Committee, this bill will result in approximately up to $60,000
in ongoing enforcement costs, funded from special funds.
COMMENTS : This bill is sponsored by the State Building and
AB 677
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Construction Trades Council. They state that several energy
companies have teamed up with private investment firms and are
securing long term energy deals with local school districts.
The local school district allows the firm to build a solar
installation on their rooftops and signs a long-term commitment
to buy the energy produced by the solar installation. The
sponsor argues that clearly the use of the rooftops and the
long-term commitment to provide a revenue stream to the firm
should trigger the project as a public works project and require
the payment of prevailing wages to the construction workers.
The Western Electrical Contractors Association (WECA) opposes
this measure, stating that under existing law a variety of
federal, state and local public works projects paid for with
state dollars or other incentives are subject to prevailing wage
requirements. WECA argues that this bill expands this
requirement to private contracts under certain circumstances and
represents a significant and unwarranted expansion of the policy
into private works of improvement. WECA states that there can
be little disagreement that a prevailing wage mandate results in
higher costs. While this bill only applies to projects that
supply school and community college districts with renewable
energy, it is inappropriate to saddle either the energy provider
or its customer - the school or community college district -
with the higher costs.
Similarly, the Riverside County Schools Advocacy Association
argues that the additional costs imposed by this measure would
have a chilling effect on school district ability to consider
renewable energy projects. They contend that this bill would
result in a disservice not only to schools and students, but
also to local communities and the environment.
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091
FN: 0002178