BILL ANALYSIS �
AB 1386
Page 1
Date of Hearing: May 9, 2011
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
AB 1386 (Bradford) - As Amended: March 31, 2011
SUBJECT : Women, minority, and disabled business enterprise
development
SUMMARY : This bill encourages cable television corporations and
direct broadcast satellite providers to voluntarily adopt a plan
for increasing women, minority, and disabled veteran business
enterprise procurement and to voluntarily report activity in
this area to the Legislature on an annual basis.
EXISTING LAW
Requires investor owned utilities to annually report to the
California Public Utilities Commission (PUC) on procurement
activities with diverse businesses (ethnicity, gender and
disabled veteran status) in all business categories, including,
but not limited to, renewable energy, wireless
telecommunications, broadband, smart grid, and rail projects.
Established voluntary procurement goals of 5 percent from woman
owned, 15 percent from minority owned, and 1.5 percent for
disabled veteran-owned business enterprises, equaling 21.5
percent of total procurement for public utilities.
Requires wireless telecommunications service providers with
gross annual revenues of more than $25,000,000 to meet
procurement requirements for minority-, women-, and disabled
veteran owned business enterprises and encourage these providers
to voluntarily submit plans to the PUC.
FISCAL EFFECT : Unknown
COMMENTS :
According to the author, women and minority-owned business
participation in the broadband industry will be critical to job
recovery in California. Small businesses are critical sources of
new employment.
AB 1386
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In the most recent CPUC report to the legislature, utility
spending on diverse procurement increased from $3.47 billion in
2008 to $4.27 billion in 2009, an increase of 23.05 percent.
There was also an increase as a percentage of total utility
procurement; amounts from diverse firms increased from 13.19
percent in 2008 to 16.72 percent in 2009. The same potential for
reporting and achievement may exist with cable television
corporations and direct broadcast satellite providers.
In California, women and minority-owned businesses represent the
bulk of small businesses. Since diverse business owners are much
more likely to hire diverse workers, the success of women and
minority-owned businesses translates into jobs for women and
minorities.
More than twenty years ago, the CPUC created Government Order
156 (GO156) to encourage a fair proportion of total utility
contracts and subcontracts for products and services to be
awarded to women, minority, and disabled veteran business
enterprises. GO156 currently requires general reporting of
diverse business procurement statistics in the utility and
telecom sectors. This reporting has encouraged major companies
to work with California's diverse business owners to achieve
greater profits. As a result of this information, California's
largest utility and telecommunications companies have increased
their diverse procurement by more than 300% for women, minority
and disabled veteran-owned businesses.
Cable television corporations and direct broadcast satellite
providers are not under the jurisdiction of the CPUC and are not
required to report on their procurement with diverse businesses.
The state, as well as the federal government, has placed
priority on the expansion of broadband particularly in rural and
underserved communities. The state and the federal government
have made nearly a billion dollars available in grants and loans
to help expand broadband service across the country. Cable
companies have and continue to make significant infrastructure
investments in this area. Direct broadcast satellite providers
also support broadband applications and have begun to petition
the government for the opportunity to compete for these public
broadband funds.
AB 1386
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Historically, minority and women-owned businesses have not been
at the contracting table within emerging technology industries.
Diversity in growing businesses is vital to California's
success. In a majority-minority state, where women represent
over 50% of California's population and people of color
represent 60%, economic recovery cannot happen without
diversity.
The extent to which women and minority-owned businesses are
being included in certain emerging sectors is largely unknown.
This bill will encourage cable television corporations and
direct broadcast satellite providers to voluntarily adopt a plan
for increasing women, minority, and disabled veteran business
enterprise procurement and to voluntarily report activity in
this area to the Legislature on an annual basis.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file
Opposition
None on file
Analysis Prepared by : Susan Kateley / U. & C. / (916)
319-2083