BILL ANALYSIS �
Bill No: AB
2138
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Lou Correa, Chair
2013-2014 Regular Session
Staff Analysis
AB 2138 Author: Gatto
As Amended: April 29, 2014
Hearing Date: June 10, 2014
Consultant: Art Terzakis
SUBJECT
Innovation Awards
DESCRIPTION
AB 2138 creates a one-year "innovation awards" contest in
state government for the purpose of awarding cash prizes to
eligible California participants who are not employees of
the State. Specifically, this measure:
1)Requires the Governor to designate three state agencies
to participate in a pilot program to award cash prizes of
up to twenty-five thousand dollars ($25,000) to
participants in an innovation contest established by each
designated agency.
2)Appropriates seventy-five thousand dollars ($75,000) from
the General Fund to the Governor, for allocation to the
designated state agencies for purposes of the awards.
3)Specifies that the innovation contests must be held in
2015 and shall be open to all residents of California who
are not employees of the state.
4)Requires each designated state agency to determine the
specific subject of the innovation contest and administer
its innovation contest, including but not limited to,
determining the standards for participation and award and
publicizing the contest.
5)Specifies that the subject of the innovation may include
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proposals that detail a procedure, plan, design, or idea
to contribute to the efficiency, economy, or other
improvement in the operations of the state agency,
including, but not limited to, streamlining an existing
process or system of the state agency or the design of a
feedback system for the state agency.
6)Requires each designated state agency, on or before
January 1, 2016, to award a prize of up to $25,000 to the
participant the agency determines has submitted the entry
that best addresses the subject of the contest, and has
the highest likelihood of being adopted and placed in
effect. Also, requires that unawarded prize money revert
to the General Fund.
EXISTING LAW
Existing law, the State Merit Award Program, authorizes the
California Department of Human Resources (CalHR) to make
awards to current or retired state employees who propose
procedures or ideas that are subsequently adopted and
placed in effect and result in eliminating or reducing
state expenditures or improving state operations. The law
provides that any such award in excess of $5,000 must be
approved by concurrent resolution of the Legislature.
BACKGROUND
The State Merit Award Program, administered by CalHR,
provides cash awards to active and retired state employees
who propose ideas that are implemented and result in
savings to the state or improvement in state operations.
According to CalHR, awards to employees for adopted
suggestions are paid from the individual departments out of
the projected first year savings resulting from
implementation of the respective suggestions and not
directly from the General Fund. Additionally, CalHR points
out that on average, 566 ideas are submitted each year and
21 lead to monetary awards. The majority of awards involve
improved procedures and the average award amounts to
approximately $100. Awards exceeding $5,000 are required
to be approved by concurrent resolution of the Legislature.
Purpose of AB 2138: The author's office notes that this
measure stems from a suggestion in Lieutenant Governor
Gavin Newsom's book, Citizenville , which states that
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"incentive prizes are a perfect bipartisan solution: They
solve problems, help people, and save money, thereby
fulfilling goals that span the whole political spectrum."
These prizes have been around for centuries, dating back to
1714 when the British government created the "Longitude
Prize" - a 20,000 award (more than $4 million in today's
dollars) to the person able to formulate a method to
calculate the longitude of a ship once it had sailed out of
view of land - surprisingly, it was a watchmaker not an
astronomer or navigator that was able to calculate
longitude and win the challenge.
Furthermore, the author's office points out that most
recently the Defense Advanced Research Projects Agency
(DARPA) launched a contest in February of 2011 to quickly
develop a combat vehicle that could be used for
reconnaissance as well as delivery and evacuation. The
contest was open to anyone, and the winner, to be chosen by
vote, would receive a $7,500 prize, in addition to seeing
their prototype built. Ordinarily, the procurement process
for developing this type of vehicle would cost the
government millions and take a considerable amount of time.
However, with the contest deadline of mid-March, DARPA had
over 150 designs to choose from within weeks, and was able
to deliver the prototype within another 14 weeks.
The author's office believes that AB 2138 will incentivize
everyday citizens to bring untapped expertise and
imagination to the streamlining or innovation of a process,
procedure, or issue within state government and give
participating state agencies the authority to experiment
with this entrepreneurial process to solve problems.
PRIOR/RELATED LEGISLATION
ACR 61 (Beth Gaines), Chapter 138, Statutes of 2013.
Authorized the payment of state merit awards in excess of
$5,000 approved by CalHR to specified state employees whose
proposals resulted in eliminating or reducing state
expenditures or improving state operations.
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ACR 178 (Niello), Chapter 159, Statutes of 2010. Declared
that merit award payments in specified amounts, authorized
by the Department of Personnel Administration (DPA), are
made to specified current or retired state employees whose
proposals have resulted in annual savings and net revenue
gain to the state.
ACR 116 (Blakeslee), Chapter 85, Statutes of 2006.
Declared that merit award payments in specified amounts,
authorized by the DPA, are made to specified current or
retired state employees whose proposals have resulted in
annual savings and net revenue gain to the state.
SUPPORT: As of June 6, 2014:
Lieutenant Governor Gavin Newsom
California Association of Professional Scientists
California Forward
OPPOSE: None on file as of June 6, 2014.
FISCAL COMMITTEE: Senate Appropriations Committee
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