BILL ANALYSIS                                                                                                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                          AB 551 (Campos)
          
          Hearing Date: 8/15/2011         Amended: 6/29/2011
          Consultant: Bob Franzoia        Policy Vote: L&IR 5-1
          _________________________________________________________________
          ____
          BILL SUMMARY: AB 551 would increase the maximum penalty from $50 
          to $200 a day and would increase the minimum penalty (except in 
          certain cases of a good faith mistake) from not less than $10 to 
          not less than $40 a day for prevailing wage violations on a 
          public work.  This bill would also increase the penalty assessed 
          from $20 to $80 to contractors and subcontractors with previous 
          violations and from $30 to $120 for willful violations.   This 
          bill would require the Labor Commissioner (commissioner) to 
          maintain a Web site listing of contractors who are ineligible to 
          bid on or be awarded a public works contract and at least 
          annually notify awarding bodies of the availability of the list 
          of disbarred contractors.  In addition, the commissioner shall 
          notify the contractor or subcontractor that, in addition to any 
          other penalties, the contractor shall be subject to disbarment 
          if certified payroll records are not produced within 30 days.  
          Failure to comply by that deadline would prohibit the contractor 
          from bidding on or be awarded a contract for public work or 
          performing work as a subcontractor on a public work.
          _________________________________________________________________
          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2011-12      2012-13       2013-14     Fund
           Increased prevailing wage                     
          notification requirements                                   
           - enforcement         $38        $77         $77       Special*

           - noticing/posting    Up to $25  $10         $10       Special*
                                 
          * Labor Enforcement and Compliance Fund
          _________________________________________________________________
          ____

          STAFF COMMENTS: This bill would revise Labor Code 17771 to 
          require the commissioner to notify a contractor or subcontractor 
          that, in addition to any other penalties, the contractor shall 
          be subject to disbarment if certified payroll records are not 








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          produced within 30 days.  Staff estimates this workload would be 
          handled by up to one Deputy Labor Commissioner l ($4,357-5,631; 
          total compensation $76,966 annually) in the Bureau of Field 
          Enforcement.  This bill may result in increased fines and 
          penalties which are deposited in the General Fund.

          This bill would also revise Labor Code 1777.1 to require the 
          commissioner to maintain a Web site listing of contractors who 
          are ineligible to bid on or be awarded a public works contract 
          and annually notifying awarding bodies of the availability of 
          the list of disbarred contractors.  Information technology costs 
          to create a Web site listing of contractors are estimated at up 
          to $25,000 one time and $10,000 ongoing.  There could be minor 
          savings from not having to distribute the list of ineligible 
          contractors.  However, the commissioner would also have a new 
          requirement to notify awarding bodies of the availability of the 
          list.