BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 474
                                                                  Page  1

          Date of Hearing:   August 4, 2010

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                   SB 474 (Ducheny) - As Amended:  August 2, 2010 

          Policy Committee:                               
          TransportationVote:10-1

          Urgency:     Yes                  State Mandated Local Program:   
          No     Reimbursable:              

           SUMMARY  

          This bill requires a lead agency, prior to entering into a  
          public-private partnership agreement or a design-build contract,  
          to pass a resolution identifying the anticipated benefits of  
          these methods compared to using traditional methods.

           FISCAL EFFECT  

          Minor absorbable costs to Caltrans or local transportation  
          agencies to prepare the required resolutions prior to entering  
          into a Public-private partnership (P3) or design-build  
          agreement.

           COMMENTS  

           1)Background  . P3 agreements are an alternative means of  
            providing both project delivery and financing. SBX2 4  
            (Cogdill)/Chapter 2 of 2009, allows regional transportation  
            agencies and Caltrans, until January 1, 2017, to enter into an  
            unlimited number of such agreements with private entities for  
            the design, finance, construction, maintenance, or operation  
            of a highway, street, or rail projects, subject to specified  
            terms and conditions.

            Design-build is a project delivery procurement method in which  
            both the design and construction of a project are procured  
            from a single entity. SBX2 4 established the Design-build  
            Demonstration Program to permit Caltrans and local  
            transportation entities, until January 1, 2014, to utilize  
            design-build for up to 15 transportation projects statewide,  
            subject to specified conditions. SBX2 4 vests the California  








                                                                  SB 474
                                                                  Page  2

            Transportation Commission with responsibility for authorizing  
            transportation entities to use this procurement method.
           

          2)Purpose  . The prior version of this bill required lead  
            transportation agencies, within 90 days after awarding a P3 or  
            design-build contract, to make a finding regarding the  
            identified benefits of using the alternative method. Due to  
            concerns that such a requirement was unrealistic for methods  
            being used on a pilot basis and the potential for legal  
            challenges to such findings, the most recent amendments just  
            require a lead agency resolution regarding the potential  
            benefits. 


           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081