BILL ANALYSIS
SENATE LOCAL GOVERNMENT COMMITTEE
Senator Patricia Wiggins, Chair
BILL NO: SB 694 HEARING: 1/6/10
AUTHOR: Correa FISCAL: Yes
VERSION: 12/15/09 CONSULTANT: Detwiler
UNIFORM PUBLIC CONSTRUCTION COST ACCOUNTING ACT
Background and Existing Law
The Public Contract Code spells out the procedures that
local officials follow when they build public works
projects, including limits on the contracts' values.
When counties, cities, special districts, redevelopment
agencies, school districts, and community college districts
voluntarily adopt the standards and procedures of the
Uniform Public Construction Cost Accounting Act, they can
use higher limits for their contracts (AB 1666, Cortese,
1983). The State Controller must tell local agencies
about the Act's benefits (AB 1047, Houston, 2007). About
700 local agencies participate.
A 14-member California Uniform Construction Cost Accounting
Commission reviews the statutory limits every five years.
If the Commission recommends higher amounts, the State
Controller promulgates the changes and the Legislature
periodically amends the Act to reflect the new limits.
Currently, local agencies can use their own employees for
projects worth $30,000 or less. This amount is called the
"force account limit." Projects worth $125,000 or less
rely on informal bids; projects that cost more than
$125,000 require formal bids (SB 1196, Senate Local
Government Committee, 2006).
When someone contends that a local agency isn't following
the Act, the Commission has 30 days to review and act on
the dispute. If the Commission finds that a local agency
has violated the Act three times within a 10-year period,
it can prohibit that agency from using the Act for five
years (AB 2372, Pavley, 2006).
The State General Fund doesn't pay the Commission's
administrative expenses. The Act requires the State
Controller to provide limited staff support to the
Commission whose members are uncompensated, except for
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travel expenses. Since 2004, when the Commission began
soliciting money from local agencies, contractors'
associations, and labor unions, it's received about $11,000
in donations. This lack of a dependable revenue stream
makes it hard for the Commission to respond quickly to
complaints.
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Proposed Law
Senate Bill 694 extends the time limit for the California
Uniform Construction Cost Accounting Commission to review
and act on disputes over whether local agencies have
followed the Uniform Public Contract Construction Cost
Accounting Act. For complaints which allege that local
officials rejected all bids and instead claimed that the
agency can do the work less expensively, SB 694 extends the
time limit from 30 days to 45 days. For complaints which
allege that local officials have either exceeded the force
accounts or improperly classified the work as maintenance,
the bill extends the time limit from 30 days to 90 days.
SB 694 allows the Commission to impose reasonable fees on
the agencies that have elected to be subject to the Act's
procedures. The bill requires that the Commission ensure
that the total amount collected equals the amount
reasonably needed to cover the Commission's administrative
costs.
Comments
1. Dollars and duties . The California Uniform
Construction Cost Accounting Commission has considerable
responsibilities, but only limited resources. Without
State General Fund support or its own employees, the
Commission gets by on donations and the help that the State
Controller's Office can spare. As a result, it's hard for
the Commission to resolve complicated complaints within the
30-day statutory deadline. By extending the time limits
for the Commission to act on complaints, the bill gives the
part-time body enough time to fulfill its statutory duties.
By allowing the Commission to charge fees to the
participating local governments, SB 694 improves oversight
of how local officials use the more flexible state law.
2. It's about time . Because the California Uniform
Construction Cost Commission is a part-time body without
employees, it's nearly impossible for the commissioners to
investigate complaints and then schedule a publicly noticed
hearing within the 30-day statutory time limit. SB 694
extends that deadline by creating a two-tier arrangement:
45 days for one type of allegation, 90 days for the other
two types of complaints. The Committee may wish to
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consider an amendment that provides a simpler approach: 90
days to review and act on all complaints.
3. Take it easy . State regulatory fees shouldn't generate
revenues that exceed a program's costs. SB 694 limits the
California Uniform Construction Cost Commission's new fees
to "the amount necessary to cover the commission's costs."
While that formula fits, it lacks a fixed limit on the
amount to be paid by the participating local governments.
If legislators want to tread carefully, the Committee may
wish to consider amendments that: (1) preclude the
Commission from charging more than $500 a year to a
participating local government, (2) encourage the
Commission to adopt a sliding scale for its fees, and (3)
put a seven-year sunset clause on the new fee authority so
that legislators can review how the Commission responds.
4. Legislative history . When originally introduced in
February 2009, SB 694 would have set a threshold for
requiring competitive bids on local public works projects,
with few exceptions. The May 2009 amendments reduced the
bill to a statement of legislative intent. The December
15, 2009 amendments removed all of that language and
instead substituted the changes to the Uniform Construction
Cost Accounting Act.
Support and Opposition (12/22/09)
Support : Air-conditioning & Refrigeration Contractors
Association, Air Conditioning Sheet Metal Association,
Associated General Contractors, California Chapter of the
American Fence Contractors' Association, California
Chapters of the National Electrical Contractors
Association, California Fence Contractors' Association,
California Landscape Contractors Association, California
Legislative Conference of the Plumbing, Heating, and Piping
Industry, Construction Industry Force Account Council,
Engineering Contractors' Association, Flasher/Barricade
Association, Marin Builders' Association, Southern
California Contractors Association.
Opposition : California State Association of Counties,
Regional Council of Rural Counties.
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