BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 224|
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UNFINISHED BUSINESS
Bill No: SB 224
Author: Pavley (D)
Amended: 9/1/11
Vote: 21
SENATE NATURAL RES. AND WATER COMMITTEE : 9-0, 4/26/11
AYES: Pavley, La Malfa, Cannella, Evans, Fuller, Kehoe,
Padilla, Simitian, Wolk
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SENATE FLOOR : 37-0, 5/16/11
AYES: Alquist, Anderson, Berryhill, Blakeslee, Calderon,
Cannella, Corbett, Correa, De Le�n, DeSaulnier, Dutton,
Emmerson, Evans, Fuller, Gaines, Hancock, Harman,
Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu,
Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio,
Runner, Simitian, Steinberg, Vargas, Wolk, Wright, Yee
NO VOTE RECORDED: Strickland, Walters, Wyland
ASSEMBLY FLOOR : 76-0, 9/6/11 - See last page for vote
SUBJECT : Public contracts: Department of Water
Resources
SOURCE : Author
DIGEST : This bill exempts specified Department of Water
Resources (DWR) contracts from competitive bidding
requirements and Department of General Services (DGS)
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approval.
Assembly Amendments (1) exempt DWR contracts over $25,000
for the acquisition of specialized equipment for State
Water Resources Development System (SWRDS) facilities from
competitive bidding requirements, (2) require DWR to
collaborate with the DGS to establish conditions where
competitive bidding exemptions apply in order to expedite
operations and maintenance work to reduce the risk of the
loss of water or power to the SWRDS, (3) exempt from
approval by DGS, contracts for the acquisition, sale, or
transmission of power, or for services to facilitate such
activities under the Central Valley Project (CVP) or the
California Resources Development Bond Act, (4) exempt
service contracts for the operation, maintenance, repair,
or replacement of specialized equipment at SWRDS facilities
under the CVP or California Water Plan from competitive
bidding requirements and DGS approval, (5) delete
provisions exempting DWR goods and services contracts from
DGS approval if they are authorized to be entered into
under the Water Code or if they are federally or locally
funded, and (6) make technical and clarifying changes.
ANALYSIS : Existing law:
1. Provides that all contracts entered into by any state
agency for goods, services, or other specified
activities are void unless and until approved by the
DGS.
2. Exempts certain transactions and contracts from that
law, as specified.
This bill:
1. Exempts DWR contracts over $25,000 for the acquisition
of specialized equipment for SWRDS facilities from
competitive bidding requirements.
2. Requires DWR to collaborate with DGS to establish
conditions where competitive bidding exemptions apply in
order to expedite operations and maintenance work to
reduce the risk of the loss of water or power to the
SWRDS.
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3. Exempts from approval by DGS, contracts for the
acquisition, sale, or transmission of power, or for
services to facilitate such activities under the CVP or
the California Resources Development Bond Act.
4. Exempts service contracts for the operation,
maintenance, repair, or replacement of specialized
equipment at SWRDS facilities under the CVP or
California Water Plan from competitive bidding
requirements and DGS approval.
5. Makes technical and clarifying changes.
Background
Under current law, all state contracts must be reviewed and
approved by DGS, with some notable exceptions. For
example, all of the Department of Transportation's
(CalTrans) contracts are exempt from the DGS review.
DGS tries to get back to the contracting department within
10 working days as to whether or not DGS has issues with
the contract. If they do, there will be additional time
required to work out the details of the contract issues -
sometimes just days, sometimes over a month, depending on
the issue with the contract. DGS also charges the
contracting department for DGS's time - the DGS fee for
contracts for last fiscal year was 1.6 percent of the value
of the contract.
Some of the DWR contracts are exempt from DGS review. They
are:
Construction Contracts
Architecture and Engineering Contracts
State Water Project Contracts
While those contracts cover a large part of DWR's contract
activity, it still leaves a significant number of contracts
subject to DGS review. These include contracts for
procurement, energy, subscription services, bond funded
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grant programs, and miscellaneous service contracts. Last
fiscal year, DWR spend about $ 21.7 million for
non-construction contracting.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Assembly Appropriations Committee, minor
administrative cost savings to DGS and DWR, and potential
contract cost savings.
SUPPORT : (Verified 9/7/11)
Alameda County Flood Control and Water Conservation
District Zone 7
Alameda County Water District
Association of California Water Agencies
Burbank Water and Power
California Municipal Utilities Association
Calleguas Municipal Water District
Castaic Lake Water Agency
Central Coast Water Authority
Cucamonga Valley Water District
Desert Water Agency
East Valley Water District
Eastern Municipal Water District
Glendale Water and Power
Irvine Ranch Water District
Kern County Water Agency
Las Virgenes Municipal Water District
Metropolitan Water District of Southern California
Mojave Water Agency
Municipal Water District of Orange County
Newhall County Water District
Orchard Dale Water District
Rancho California Water District
Rowland Water District
San Bernardino Valley Municipal Water District
Santa Clara Valley Water District
Solano County Water Agency
Southern California Water Committee
State Water Contractors
Three Valleys Municipal Water District
Tulare Lake Basin Water Storage District
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Upper San Gabriel Valley Municipal Water District
Valley Ag Water Coalition
ARGUMENTS IN SUPPORT : According to the author:
"Each year, the Department of Water Resources (DWR)
enters into hundreds of contracts, often valued in the
millions. Despite having an extensive contracting
operation staffed by dozens of experienced attorneys and
contract specialists, DWR must still have many of its
contracts reviewed and approved by the Department of
General Services (DGS). This additional level of review
delays the execution of contracts and adds unnecessary
costs to each contract.
"SB 224 will provide DWR the same exception to DGS's
contract review that has been given to CalTrans. In
doing so, SB 224 will eliminate costly contract delays
and unnecessary bureaucratic review."
ASSEMBLY FLOOR : 76-0, 9/6/11
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani,
Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Grove,
Hagman, Halderman, Hall, Harkey, Hayashi, Roger
Hern�ndez, Hill, Huber, Hueso, Huffman, Jeffries, Jones,
Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor,
Miller, Mitchell, Monning, Morrell, Nestande, Nielsen,
Norby, Olsen, Pan, Perea, V. Manuel P�rez, Portantino,
Skinner, Smyth, Solorio, Swanson, Torres, Valadao,
Wagner, Wieckowski, Williams, Yamada, John A. P�rez
NO VOTE RECORDED: Conway, Gorell, Mendoza, Silva
CTW:kc 9/7/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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