BILL NUMBER: SB 467	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 3, 2011
	AMENDED IN SENATE  APRIL 12, 2011

INTRODUCED BY   Senator Pavley

                        FEBRUARY 17, 2011

   An act to add Section 15814.37 to the Government Code, relating to
state buildings.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 467, as amended, Pavley. Department of General Services:
contracts for energy efficiency products or services.
   The State Building Construction Act of 1955 requires that all new
public buildings be equipped with all energy efficiency measures,
materials, and devices that are feasible and cost-effective, as
defined, over the life of the building or the life of the energy
efficiency measure, whichever is less, and sets forth the duties of
the Department of General Services in this regard.
   This bill would additionally require the department to deem a
contract for an energy efficiency product or service to be a no-cost
or net-neutral cost contract when specified conditions are met. It
would require the department to issue a  n   onmandatory
 master services agreement permitting owners, operators, and
tenants of state facilities to procure a wide range of energy
efficiency products or services according to specified criteria.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  The Legislature finds and declares as follows:
   (a) The state urgently needs to save state funds and in so doing
needs to take cost-effective steps to improve energy efficiency.
   (b) These goals should not be impeded simply because there is no
particular contracting method specifically permitting the state to
purchase energy saving products or services where the state does not
have to pay out-of-pocket for those technologies or services but
nevertheless enjoys the monetary savings from those purchases.
  SEC. 2.  Section 15814.37 is added to the Government Code, to read:

   15814.37.  (a) The Department of General Services shall deem a
contract for an energy efficiency product or service to be a no-cost
or net-neutral cost contract where funding for the contract is
provided through either of the following methods:
   (1) The state is required, for the life of the contract, to pay
the vendor in monthly or other scheduled increments where those
payments are less than the difference between the amount the state
was paying for energy, including the cost of maintaining the
electrical and mechanical energy systems providing that facility's
energy, for a facility or facilities prior to entering into the
contract and what the state is paying for the same energy after
entering into the contract.
   (2) The contract requires the vendor to pay the state a single sum
at the execution of the contract to provide its technology or
services, at a calculated net present value figure, in exchange for
the state paying the vendor monthly or other scheduled increments in
amounts equal to the difference between what the state was paying for
energy for a facility  prior or facilities   or
facilities prior  to execution of the contract and for the same
energy after execution of the contract, for the life of the
contract.
   (b) No later than July 31, 2012, the department shall issue a 
nonmandatory  master services agreement permitting owners,
operators, and tenants of state facilities to procure a wide range of
energy efficiency products or services from  the 
 a wide range of  approved companies included in the
agreement. The companies included in the agreement shall have a
record of providing those products or services to governmental
entities or private sector companies for at least two years prior to
January 1, 2012. The department shall begin to work with relevant
university centers no later than January 1, 2012, for guidance in the
development of product and service specifications for the agreement.

   (c) Notwithstanding subdivision (b), the agreement shall include,
among other things, a provision to permit pilot or demonstration
contracts for energy efficiency products or services. An energy
efficiency product or service shall not be excluded from this portion
of the agreement because the companies included have been in
business for less than two years, or it is an emerging technology or
service that has been demonstrated to be effective in prototypical or
limited production, that could become commercially viable and
successful with appropriate market development efforts. The
department shall begin to work with relevant university centers no
later than January 1, 2012, for guidance in the development of
product and service specifications for the pilot or demonstration
portion of the agreement.
   (d) For purposes of this section, an  energy "efficiency
  "energy efficiency  product or service" means a
technology or technology service where the energy cost savings to the
state are projected to exceed the compensation the state pays for
the technology or service within 12 months of the initial deployment
of the product or service.
   (e) For purposes of this section, the difference between the
amount the state would have paid for energy and the cost of
maintaining energy consuming devices prior to entering into the
contract and what it is paying for the same energy and maintenance of
energy consuming devices after entering into the contract shall be
based upon either of the following:
   (1) The amount the state paid to  a  utility and
maintenance service contractors for a kind of energy at a particular
facility in the 36 months prior to entering the contract, divided by
month or another increment of time.
   (2) Another amount calculated by an outside third party selected
by the state and agreed to by the vendor in the contract.
   (f) Nothing in this section shall be construed to do any of the
following:
   (1) Limit the department's ability to determine a vendor is in
breach of contract.
   (2) Prevent the state from requiring other terms and conditions,
provided that those terms and conditions are not duplicative of, or
in conflict with, and do not frustrate the intent of, this section.
   (3) Prevent the department from reasonably apportioning
administrative or consulting costs required to implement the
contracting methods set forth in this section over as many contracts
as required to ensure both that the state does not lose the
opportunity to achieve energy savings and the department is able to
be fully reimbursed for those reasonable costs exclusively from
savings.
   (4) Require the creation of a General Fund obligation in
contravention of Section 1 of Article XVI of the California
Constitution.