BILL ANALYSIS
AB 930
Page 1
Date of Hearing: May 5, 2009
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Mary Hayashi, Chair
AB 930 (Saldana) - As Amended: April 14, 2009
SUBJECT : Department of General Services: Administrative
Procedures Act.
SUMMARY : Provides that the State Administrative Manual (SAM)
and the State Contracting Manual (SCM) maintained by the
Department of General Services (DGS) are exempt from the
Administrative Procedures Act (APA) for periods prior to January
1, 1999.
EXISTING LAW : Provides that commencing on January 1, 1999, the
SAM and SCAM are exempt from the APA.
FISCAL EFFECT : Unknown. This bill is keyed non-fiscal.
COMMENTS :
Purpose of the bill . According to the author's office, "The APA
was enacted on January 1, 1999. However, it did not indicate
that any regulations acted upon by the DGS (on) the SAM and the
SCM, with respect to procurement, prior to that date held the
full force and effect of the law. There was no indication that
the APA was retroactive. This bill would simply ensure that any
actions taken by DGS prior to that date had the full force and
effect of the law stated in the APA."
Background . The California Constitution and the statutes
enacted by the Legislature create the various state agencies, to
implement duly enacted laws. These powers often include the
making of rules and regulations in order to carry out their
duties. Administrative agencies adopt, amend and repeal
regulations under the authority granted to them by either
constitutional provisions or statutes. Unless the Legislature
has created an exemption, agencies must follow the procedures in
the APA when adopting, amending or repealing regulations. If a
state agency issues, enforces, or attempts to enforce a rule
without following the APA, the rule is called an "underground
regulation." State agencies are prohibited from enforcing
underground regulations.
AB 930
Page 2
According to the California State Auditor (SA) Report 2008-701,
state law typically requires provisions that are regulations,
such as many of those in the SAM and SCM, to be approved under
the APA. However, SB 1645 (Mountjoy), Chapter 731, Statutes of
1998, exempted the SAM and SCM from the APA, in response to an
appellate court opinion finding that a provision of the SAM was
invalid because it was an underground regulation.
A SA report of California Highway Patrol (CHP) contract
purchases concluded that the CHP did not sufficiently explain in
its justification why the price offered under the contract was
fair and reasonable, even though the SCM requires a
justification. The SA report states that if certain provisions
in the SAM and SCM pertaining to competitive bidding are
regulations having the force and effect of law, an argument
could be made that failure to comply with those provisions would
result in a contract becoming void. The SA's legal counsel
opined that since SB 1645 was enacted, no court has definitively
found that the provisions of the SAM and SCM relating to
competitive bidding are regulations having the force and effect
of law. The SA recommended in its report that clarification in
statute that SAM and SCM provisions have the force and effect of
law.
Prior Legislation . SB 1645 (Mountjoy), Chapter 731, Statutes of
1998, exempted the SAM and SCAM from the APA, as of January 1,
1999.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Joanna Gin / B. & P. / (916) 319-3301