BILL ANALYSIS                                                                                                                                                                                                    


                      SENATE COMMITTEE ON VETERANS AFFAIRS
                             JEFF DENHAM, CHAIRMAN
                                             


          Bill No:        SB 548   
          Author:         Huff
          Version:        As Amended April 13
          Hearing Date:   April 14, 2009
          Fiscal:         Yes
          Consultant:     Donald E. Wilson

                                 SUBJECT OF BILL  
          Disabled Veterans' Business Enterprises (DVBE)s and fraud  
          penalties on state contracts.  
           
                                   PROPOSED LAW  
          Impose civil penalties for lying to the state about the use  
          of DVBEs on contracts.

                           EXISTING LAW AND BACKGROUND  
          Since 1989 California has encouraged entities that have  
          been awarded state contracts to have DVBEs do at least  
          three percent of the work on the contract.  The goal is  
          often sidestepped as there is no penalty for ignoring it.   
          In some cases the DVBE is used but not paid.

          Because of the above mentioned problem last year the  
          Assembly Veterans' Affairs Committee offered AB 1189.  The  
          committee dropped the bill after it was mistakenly told  
          that there was only one known case of this ever happening.
                                         
                                    COMMENT  
             1.   This committee supported this bill unanimously in  
               2007.

             2.   After speaking with the Department of General  
               Services (DGS) this problem is more widespread than  
               one case.

             3.   DVBEs are mostly very small businesses without the  
               resources to enter into drawn out legal situations.

             4.   This bill addresses cases when the work has been  
               done without payment received.

             5.   Having a record on file under civil penalty gives  
               an avenue to pursue resolution of non-payment. 

                                     SUPPORT  





          The California Disabled Veterans Business Alliance
          Legion of Valor of the USA (Medal of Honor Legion)
          American Legion, Department of California
          AMVETS, Department of California
          Compliance News

                                      OPPOSE  
          None received








































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