BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 1705
                                                                  Page  1

          CONCURRENCE IN SENATE AMENDMENTS
          AB 1705 (Williams)
          As Amended  August 11, 2014
          Majority vote
           
           ----------------------------------------------------------------- 
          |ASSEMBLY:  |74-0 |(May 5, 2014)   |SENATE: |35-0 |(August 14,    |
          |           |     |                |        |     |2014)          |
           ----------------------------------------------------------------- 
            
           Original Committee Reference:    A. & A.R.   

           SUMMARY  :  Clarifies the circumstances under which a public  
          agency may retain more than 5% of a contract price until final  
          completion of a substantially complex public works project.  

           The Senate amendments  :

          1)Require any finding by a public entity that a project is  
            substantially complex to include a description of the specific  
            project and why it is a unique project that is not regularly,  
            customarily, or routinely performed by the entity or licensed  
            contractors.

          2)Extend the sunset date on existing law governing public  
            agencies' retention requirements from January 1, 2016, to  
            January 1, 2018.

           FISCAL EFFECT  :  None

           COMMENTS  :  Pursuant to SB 293 (Padilla), Chapter 700, Statutes  
          of 2011, the maximum amount of money that public agencies can  
          withhold from a contractor prior to completion of the job is 5%  
          of the total contract.  However, public agencies may retain a  
          higher percentage if the agency, after a proper hearing, finds a  
          project to be "substantially complex," provided that the finding  
          itself and the actual retention amount are included in the bid  
          documents.  This bill requires an explanation of the basis for  
          the finding to be included in the bid documents and requires  
          local agencies specifically to approve a substantially complex  
          finding on a project by project basis.  

          Senate amendments remove provisions defining what does not  
          constitute a substantially complex project, and instead, require  
          additional information to be included when a substantially  








                                                                  AB 1705
                                                                  Page  2

          complex finding is made.  The Senate amendments also provide a  
          two-year, rather than four-year, extension of the sunset date on  
          existing law governing retention proceeds. 


           Analysis Prepared by  :    Cassie Royce / A. & A.R. / (916)  
          319-3600 


                                                               FN: 0004590