BILL ANALYSIS �
-----------------------------------------------------------------
|SENATE RULES COMMITTEE | SB 268|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
-----------------------------------------------------------------
THIRD READING
Bill No: SB 268
Author: Gaines (R)
Amended: 1/27/14
Vote: 27 - Urgency
SENATE GOVERNANCE & FINANCE COMMITTEE : 6-0, 1/15/14
AYES: Wolk, Knight, Beall, DeSaulnier, Hernandez, Liu
NO VOTE RECORDED: Vacancy
SUBJECT : Health care districts: public contracts:
design-build
SOURCE : Last Frontier Health Care District
DIGEST : This bill allows the Last Frontier Health Care
District's (District) board of directors, notwithstanding any
other law, to use the design-build procedure to construct a
building or improvements directly related to the construction of
a hospital or health facility building at the Modoc Medical
Center. This bill specifies that the District must use the
design-build procedure that current law establishes for counties
and provides that statutory references to a "county" and a
"board of supervisors" also mean the Last Frontier Health Care
District and its board of directors.
ANALYSIS : Exiting law allows state and local officials to use
the design-build method to procure both design and construction
services from a single company before the development of
complete plans and specifications. Under design-build, a public
agency contracts with a single entity, which can be a single
CONTINUED
SB 268
Page
2
firm, a consortium, or a joint venture, to design and construct
a project. Before inviting bids, the agency prepares documents
that describe the basic concept of the project, as opposed to a
complete set of drawings and specifications of what will be
constructed. In the bidding phase, the agency typically
evaluates bids on a best-value basis, incorporating technical
factors, such as qualifications and design quality, in addition
to price.
This bill allows the District's board of directors,
notwithstanding any other law, to use the design-build procedure
to construct a building or improvements directly related to the
construction of a hospital or health facility building at the
Modoc Medical Center. This bill specifies that the District
must use the design-build procedure that current law establishes
for counties and provides that statutory references to a
"county" and a "board of supervisors" also mean the Last
Frontier Health Care District and its board of directors.
This bill requires that a hospital building project using the
design-build process authorized by the bill must be reviewed and
inspected in accordance with the standards and requirements of
the Alfred E. Alquist Hospital Facilities Seismic Safety Act of
1983.
This bill finds and declares the Legislature's intent that
health care districts use the design-build process solely for
buildings associated with hospitals and health care and not for
other infrastructure, including, streets, highways, public rail
transit, roads, bridges, and water resources facilities.
This bill contains findings, declarations and a contingency upon
the enactment of SB 785 (Wolk-D).
Background
All counties can use the design-build method to construct
buildings and related improvements and wastewater treatment
facilities that cost more than $2.5 million. Similarly, all
cities can use the design-build method to construct buildings
and related improvements worth more than $1 million. A pilot
program also permits cities, counties, and special districts to
use the design-build method to construct 20 local wastewater
treatment facilities, local solid waste facilities, or local
CONTINUED
SB 268
Page
3
water recycling facilities.
The Legislature also has passed a number of bills authorizing
some special districts to construct projects using the
design-build method, including the Sonoma Valley Health Care
District (SVHCD) (SB 1699, Wiggins, Chapter 415, Statutes of
2008). Following SB 1699's enactment, the SVHCD's voters
approved a $35 million bond to finance earthquake safety
improvements to bring the hospital's emergency room into
compliance with the state's seismic safety standards for
hospitals. The SVHCD's upgraded facility, which was constructed
using design-build contracts, opened last year.
The District operates the Modoc Medical Center in Alturas (Modoc
County). The medical center is comprised of a critical access
hospital, a skilled nursing facility, and a rural health clinic
providing vital health services to a sparsely populated rural
community. State law requires the District to move its hospital
into a building that meets the state's seismic safety standards.
District officials are in the early stages of planning the
construction of a new building that is expected to be a
single-story, 10 bed, 40,000 square foot facility.
Related Legislation
SB 785 (Wolk, 2013), which repeals state laws authorizing state
and local government agencies to use design-build contracting
and enacts new, uniform statutes governing agencies'
design-build contracts.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
SUPPORT : (Verified 1/27/14)
Last Frontier Health Care District dba Modoc Medical Center
(source)
Association of California Healthcare Districts
California Association of Rural Health Clinics
Design-Build Institute of America
Modoc County Board of Supervisors
ARGUMENTS IN SUPPORT : According to the author's office, with
the increase in new patients under the Affordable Care Act, and,
CONTINUED
SB 268
Page
4
healthcare costs going up while reimbursement rates continue to
decline, savings on construction are critical. The Design-Build
method of project delivery can provide significant cost savings
that will benefit the entire community.
AB:nl 1/27/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
CONTINUED