BILL ANALYSIS
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: SB 1215
SENATOR ALAN LOWENTHAL, CHAIRMAN AUTHOR: price
VERSION: 4/8/10
Analysis by: Art Bauer FISCAL: Yes
Hearing date: April 20, 2010
SUBJECT:
Department of Transportation: architectural and engineering
services
DESCRIPTION:
This bill authorizes the Department of Transportation (Caltrans)
to establish prequalified lists of firms providing architectural
and engineering services.
ANALYSIS:
In 2000, the voters approved Proposition 35-Public Works
Projects and the Use of Private Contractors for Architectural
and Engineering Services to amend the California Constitution to
permit all public agencies in the state, including Caltrans, to
contract with qualified architectural and engineering firms for
professional services on all public works projects. Proposition
35 defined in statue architectural and engineering services to
include architectural, landscape architectural, environmental,
engineering, land surveying, and construction management
services.
Existing law provides the services shall be procured in a fair,
competitive process and prohibits public employees from
participating in the selection process if they have any
financial interest or business relationship with the firms
competing for the services.
Caltrans has promulgated, consistent with the Administrative
Procedures Act (APA), an extensive body of regulations that
implement exiting contracting law. For example, in terms of
qualifications of firms, the regulations state the following:
The [selection] criteria shall include such factors as
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professional excellence, demonstrated competence,
specialized experience of the firm, education and
experience of key personnel to be assigned, staff
capability, workload, ability to meet schedules,
nature and quality of completed work, reliability and
continuity of the firm and/or subcontractors,
location, or other considerations deemed relevant.
Such factors shall be weighted by the Director
according to the nature of the project, the needs of
the state and complexity and special requirements of
the specific project.<1>
In terms of ensuring the participation of small business,
the regulations require Caltrans to publish solicitations
for services in the state's Contract Register, follow the
requirements established by the Department of General
Services for retaining small businesses, and mandate that
the Caltrans director participate in outreach activities
soliciting small business participation in seeking
architectural and engineering services with Caltrans.
This bill :
1) Provides, at the "election" of Caltrans, that it shall
advertise to contract for the following categories of
professional services: architectural, engineering,
environmental planning, landscape architectural, or land
surveying services in a manner consistent with the
contracting law this bill creates.
2) Defines terms, including creating definitions for:
Small projects as projects with an estimated value
of greater than $5,000 but less than $500,000.
Medium projects as projects with an estimated value
of greater than $500,000 but less than $5 million.
Large projects as projects with an estimated value
in excess of $5 million.
1) Establishes a separate Caltrans contracting category for
contracts having an estimated value of greater than $5,000,
but less than $250,000 and awarded to certified small
businesses, including microbusinesses and disabled veteran
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<1> California Administrative. Code Title 21, 1520.3
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business enterprises.
2) Requires Caltrans to establish evaluation criteria and
advertise for firms to provide services in order to create
a prequalified list of architectural and engineering firms
for each category of service and for small, medium, and
large projects by geographical area.
3) Requires the qualified list of firms to contain no less
than three firms and that the firms be ranked and the list
be maintained for no less than two years.
4) Authorizes Caltrans to contact the top three
prequalified firms on the list for a specified category to
determine availability for negotiating an acceptable price.
If the price negotiation with the first ranked firm is
unsuccessful, Caltrans can proceed down the list
successively until it successfully negotiates an acceptable
price.
5) Limits firms to being on one list per category for each
geographical area.
6) Prohibits the development of a new contract list for a
category and for a contract size in a geographic area from
being developed until 90 percent of the anticipated
workload has been contracted or two years has expired,
whichever occurs first.
7) Authorizes Caltrans to negotiate with a qualified firm
for an amount determined to be fair and reasonable. Once a
contract is negotiated with a firm, it shall move to the
bottom of a prequalified list.
8) Requires Caltrans to submit a report to the Legislature
on or before January 1, 2014 evaluating the performance of
this procurement process, including the number of small,
medium, and large projects, the firms awarded contracts,
and an assessment of the prequalification process.
9) Sunsets this bill on January 1, 2014.
COMMENTS:
1) Purpose . According to the author, Caltrans buys more
than $200 million in engineering services each year from
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private firms, but fewer than 10 firms receive more than
half of the work. This bill seeks to enable small
businesses to compete for Caltrans engineering contracts by
allowing Caltrans the ability to establish prequalification
lists of architectural and engineering firms for small,
medium, and large contracts.
2) Geographic area is not defined . An important feature of
this bill is that the prequalified list of architectural
and engineering firms shall be established for small,
medium, and large contracts by geographic area. The bill
does not define "geographic area," nor does existing law
governing Caltrans' contracting. Since there is no
definition of geographic area, the term could conceivably
refer to Caltrans' twelve districts, the area of a
metropolitan planning organization, a county transportation
commission, or a regional transportation planning agency.
Because of how transportation projects are prioritized and
delivered, a case could be made that each of these areas
are plausible geographic areas.
3) Implementation of this bill may conflict with
Proposition 35 . Proposition 35-Public Works Projects and
the Use of Private Contractors for Architectural and
Engineering Services-was an initiative constitutional
amendment and statute that appeared on the June 2000
ballot. The measure, which passed, specifies the
procurement process for architectural and engineering
services to be used by all state and local public agencies.
The initiative included the usual boiler plate language
specifying that "it may be amended to further its purposes
by statute, passed in each house by a roll call vote
entered in the journal, two-thirds of the membership
concurring, and signed by the Governor."
This bill provides that "at the election" of Caltrans it
shall advertise and award architectural and engineering
services in accordance with the bill's provisions until
January 1, 2014. Caltrans does not have to use the
provisions of this bill. In fact, there may be sufficient
ambiguity between the requirements of the bill and the
statute Proposition 35 enacted that Caltrans may sued for
not following the statutory provisions of Proposition 35.
POSITIONS: (Communicated to the Committee before noon on
Wednesday,
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April 14, 2010)
SUPPORT: San Francisco Black Chamber of Commerce
OPPOSED: None received.