BILL ANALYSIS �
SB 301
Page 1
SENATE THIRD READING
SB 301 (DeSaulnier)
As Amended June 26, 2012
Majority vote
SENATE VOTE :36-0
ECONOMIC DEVELOPMENT 6-0 APPROPRIATIONS
17-0
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|Ayes:|V. Manuel P�rez, Grove, |Ayes:|Fuentes, Harkey, |
| |Beall, Block, Hueso, | |Blumenfield, Bradford, |
| |Morrell | |Charles Calderon, Campos, |
| | | |Davis, Donnelly, Gatto, |
| | | |Hall, Hill, Lara, |
| | | |Mitchell, Nielsen, Norby, |
| | | |Solorio, Wagner |
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SUMMARY : Makes technical changes to the duties of the Office of
the Small Business Advocate (OSBA), located within the
Governor's Office of Business and Economic Development (GO-Biz).
More specifically, the bill expands the mandated information on
the OSBA Web site to include the name and telephone number of
the Department of General Services' (DGS's) small business
advocate whose duty is to facilitate small businesses
participating in state procurement opportunities and the small
business advocate liaison at each state agency who has been
designated to serve as a liaison to small business suppliers who
are interested in contracting opportunities at their individual
agency.
EXISTING LAW establishes the OSBA within the Governor's Office
of Business and Economic Development (GO-Biz) for the purpose of
supporting small business development in the state.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, implementation of this bill will result in minor and
absorbable costs to GO-Biz.
COMMENTS : The Small Business Act (SBA), administered through
DGS, was implemented more than 30 years ago to increase the
participation of small business within the state's procurement
SB 301
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process. In 1989, a disabled veteran owned business enterprise
(DVBE) component and a 3% annual procurement participation goal
was added to SBA. While existing law has no annual small
business goal, since 2001 there have been four Executive Orders
(EOs) specifying a 25% annual goal for small business
participation in state procurement.
In order to assist state government entities in reaching the
small business and DVBE participation goals, contracting
entities are provided a number of specific tools, including bid
preferences, a streamlined procurement method, and designation
of a small business procurement liaisons at every agency.
Under the streamlined procurement process, the awarding state
entity is authorized to bypass the advertising, bidding, and
protest provisions in the State Contract Act. This allows a
contract to be awarded directly to a certified small business at
a contract price established by checking the proposed rate with
two other small businesses. Contracts offered under the
streamlined procurement process are currently limited to
contracts between $5,000 and $100,000. Effective January 1,
2012, the maximum contract amount will increase to $147,000 for
goods and services and $250,000 for public works.
Of the $2.5 billion of state contracts that were awarded to
small businesses in 2008-09, $225.4 million (17,310 contracts)
were awarded through the streamlined procurement process. The
actual number may be higher as only 78 of 124 departments
reported their small business procurement activities to DGS.
Certified small business and microbusiness bidders and other
bidders that commit to using certified small business and
microbusiness subcontractors are eligible for a 5% bid
preference where the solicitations are made either on the basis
of lowest responsible dollar bid, or on the basis of highest
score, considering factors in addition to price. DVBE bidders
and firms that commit to using DVBEs may also receive a bid
preference of between 1% and 5%. There are programmatic limits
to the overall value of these preferences with a single bid
preference limited to $50,000 and the combination of all
preferences not exceeding $100,000 (many DVBEs are also
certified small businesses, allowing for two preferences).
In order to qualify for state preferences and the streamlined
procurement process, small businesses and DVBE need to be
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certified, which is undertaken through the Office of Small
Business & Disabled Veteran Business Enterprise Services at DGS.
Another important component of the state's effort to increase
small business participation in state contracts is the work of
the Small Business Advocate, located at GO-Biz, and the network
of small business liaisons at larger departments including the
Department of Transportation and the Air Resource Board. Under
existing law, every state agency is also required to have a
single point of contact for small business state procurement
opportunities.
Analysis Prepared by : Toni Symonds / J., E.D. & E. / (916)
319-2090
FN: 0004936