Bill Text: CA AB2580 | 2011-2012 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Public contracts: job order contracting.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2012-09-30 - Chaptered by Secretary of State - Chapter 825, Statutes of 2012. [AB2580 Detail]

Download: California-2011-AB2580-Amended.html

---

BILL NUMBER: AB 2580	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MARCH 29, 2012

INTRODUCED BY   Assembly Member Furutani

                        FEBRUARY 24, 2012

    An act to amend Section 10108.8 of the Public Contract
Code, relating to public contracts.   An act to amend
Sections 20919.3, 20919.4, 20919.6, 20919.12, and 20919.15 of the
Public Contract Code, relating to public contracts, and making an
appropriation therefor. 



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2580, as amended, Furutani.  Department of Corrections
and Rehabilitation: Business Information System Project. 
 Public contracts: job order contracting.  
   Existing law authorizes job order contracting, as provided, by the
Los Angeles Unified School District, until December 1, 2012.
Existing law requires that the unified school district create a
report of any job order contract procured and submit an interim
report to certain committees in the Legislature and the Office of
Public School Construction, as specified. Existing law requires the
unified school district to provide specified notice of work for
subcontractors, whose bids will be taken by the primary job order
contractor. Existing law requires for contracts awarded pursuant to
these provisions that the Los Angeles Unified School District pay a
fee into the State Public Works Enforcement Fund, which funds are
continuously appropriated for the Department of Industrial Relations'
enforcement of prevailing wage requirements on public works
projects.  
   This bill would extend the operation of these provisions until
December 31, 2020, and would alter the dates for reporting
requirements, as specified. This bill would require the primary job
order contractor to provide the specified notice and take bids for
work available for subcontractors. This bill would further require a
primary job order contractor to provide justification in order to
make a substitution to the subcontractor list and would authorize the
district to request a hearing to evaluate the request. Because any
additionally authorized projects would require payment of fees into
the State Public Works Enforcement Fund, this bill would make an
appropriation.  
   Existing law imposes specified procedural and substantive content
requirements on contracts entered into by state agencies, including
the Department of Corrections and Rehabilitation.  
   This bill would make technical, nonsubstantive changes to those
provisions. 
   Vote: majority. Appropriation:  no   yes
 . Fiscal committee:  no   yes  .
State-mandated local program: no.


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

   SECTION 1.    Section 20919.3 of the  
Public Contract Code   is amended to read: 
   20919.3.  (a) (1) For contracts for public works projects awarded
prior to the effective date of the regulations adopted by the
Department of Industrial Relations pursuant to subdivision (g) of
Section 1771.5 of the Labor Code, the unified school district shall
establish and enforce for job order contracts a labor compliance
program containing the requirements outlined in Section 1771.5 of the
Labor Code, or it shall contract with a third party to operate a
labor compliance program containing the requirements outlined in that
provision. This requirement does not apply to any project where the
unified school district or the job order contractor has entered into
a collective bargaining agreement or agreements that bind all of the
contractors performing work on the projects.
   (2) For contracts for public works projects awarded on or after
the effective date of the regulations adopted by the Department of
Industrial Relations pursuant to subdivision (g) of Section 1771.5 of
the Labor Code, the unified school district shall reimburse the
department for its reasonable and directly related costs of
performing prevailing wage monitoring and enforcement on public works
projects pursuant to rates established by the department as set
forth in subdivision (h) of Section 1771.5 of the Labor Code. All
moneys collected pursuant to this subdivision shall be deposited in
the State Public Works Enforcement Fund created by Section 1771.3 of
the Labor Code, and shall be used only for enforcement of prevailing
wage requirements on those projects.
   (3) In lieu of reimbursing the Department of Industrial Relations
for its reasonable and directly related costs of performing
monitoring and enforcement on public works projects, the unified
school district may elect to continue operating an existing
previously approved labor compliance program to monitor and enforce
prevailing wage requirements on the project if it has either not
contracted with a third party to conduct its labor compliance program
and requests and receives approval from the department to continue
its existing program or it enters into a collective bargaining
agreement that binds all of the contractors performing work on the
project and that includes a mechanism for resolving disputes about
the payment of wages.
   (b) The unified school district shall prepare an execution plan
for all modernization projects that may be eligible for job order
contracting pursuant to this article. The unified school district
shall select from that plan a sufficient number of projects to be
initiated as job order contracts during each calendar year and shall
determine for each selected project that job order contracting will
reduce the total cost of that project. Job order contracting shall
not be used if the unified school district finds that it will
increase the total cost of the project.
   (c) No later than June 30,  2005   2017 
, the unified school district shall submit an interim report on all
job order contract projects completed by December 31,  2004
  2016  , to the Office of Public School
Construction in the Department of General Services and the Senate
 Committee on Business, Professions and Economic Development
 and the Assembly  Committees   Committee
 on Business  , Professions  and  Professions
  Consumer Protection  and the Senate and Assembly
Committees on Education. The interim report shall be prepared by an
independent third party and the unified school district shall pay for
the cost of the report. The report shall include the information
specified in subdivisions (a) through (h) of Section 20919.12.
   SEC. 2.    Section 20919.4 of the   Public
Contract Code   is amended to read: 
   20919.4.  Bidding for job order contracts shall progress as
follows:
   (a) (1) The unified school district shall prepare a set of
documents for each job order contract. The documents shall include a
catalog of construction tasks and preestablished unit prices, job
order contract technical specifications, and any other information
deemed necessary to describe adequately the unified school district's
needs.
   (2) Any architect, engineer, or consultant retained by the unified
school district to assist in the development of the job order
contract documents shall not be eligible to participate in the
preparation of a bid with any job order contractor.
   (b) Based on the documents prepared under subdivision (a), the
unified school district shall prepare a request for bid that invites
prequalified job order contractors to submit competitive sealed bids
in the manner prescribed by the unified school district.
   (1) The prequalified job order contractors shall, as determined by
the unified school district, bid one or more adjustment factors to
the unit prices listed in the catalog of construction tasks based on
the job order contract technical specifications. Awards shall be made
to the lowest responsible prequalified bidder.
   (2) The unified school district may award multiple job order
contracts. Each job order contract shall be awarded to the lowest
responsive and responsible prequalified bidder.
   (3) The request for bids may encourage the participation of local
construction firms and the use of local subcontractors.
   (c) (1) The unified school district shall establish a procedure to
prequalify job order contractors using a standard questionnaire
 prepared by   substantially similar to the
questionnaire used by  the Department of Industrial Relations
under Section 20101. This questionnaire shall require information
including, but not limited to, all of the following:
   (A) If the job order contractor is a partnership, limited
partnership, or other association, a listing of all of the partners
or association members known at the time of bid submission who will
participate in the job order contract.
   (B) Evidence that the members of the job order contractor have the
capacity to complete projects of similar size, scope, or complexity,
and that proposed key personnel have sufficient experience and
training to competently manage the construction of the project, as
well as a financial statement that assures the unified school
district that the job order contractor has the capacity to complete
the project.
   (C) The licenses, registration, and credentials required to
perform construction, including, but not limited to, information on
the revocation or suspension of any license, credential, or
registration.
   (D) Evidence that establishes that the job order contractor has
the capacity to obtain all required payment and performance bonding
and liability insurance.
   (E) Information concerning workers' compensation experience
history, worker safety programs, and apprenticeship programs.
   (i) An acceptable safety record  as determined by the unified
school district  .  A   In its
determination, the unified school district shall consider, but is not
required to find, a  contractor's safety record  shall
be deemed   as  acceptable if its experience
modification rate for the most recent three-year period is an average
of 1.00 or less, and its average total recordable injury/illness
rate and average lost work rate for the most recent three-year period
do not exceed the applicable statistical standards for its business
category or if the contractor is a party to an alternative dispute
resolution system as provided for in Section 3201.5 of the Labor
Code.
   (ii) Skilled labor force availability as determined by the
existence of an agreement with a registered apprenticeship program,
approved by the California Apprenticeship Council, that has graduated
apprentices in each of the preceding five years. This graduation
training for any craft that was first deemed by the Department of
Labor and the Department of Industrial Relations to be an
apprenticeable craft within the five years prior to the effective
date of this article.
   (F) A full disclosure regarding all of the following that are
applicable:
   (i) Any serious or willful violation of Part 1 (commencing with
Section 6300) of Division 5 of the Labor Code or the federal
Occupational Safety and Health Act of 1970 (Public Law 91-596),
settled against any member of the job order contractor.
   (ii) Any debarment, disqualification, or removal from a federal,
state, or local government public works project.
   (iii) Any instance where the job order contractor, or its owners,
officers, or managing employees submitted a bid on a public works
project and were found to be nonresponsive, or were found by an
awarding body not to be a responsible bidder.
   (iv) Any instance where the job order contractor, or its owners,
officers, or managing employees defaulted on a construction contract.

   (v) Any violations of the Contractors' State License Law (Chapter
9 (commencing with Section 7000) of Division 3 of the Business and
Professions Code), excluding alleged violations of federal or state
law regarding the payment of wages, benefits, apprenticeship
requirements, or personal income tax withholding, or of Federal
Insurance Contribution Act (FICA) withholding requirements settled
against any member of the job order contractor.
   (vi) Any bankruptcy or receivership of any member of the job order
contractor, including, but not limited to, information concerning
any work completed by a surety.
   (vii) Any settled adverse claims, disputes, or lawsuits between
the owner of a public works project and any member of the job order
contractor during the five years preceding submission of a bid under
this article, in which the claim, settlement, or judgment exceeds
fifty thousand dollars ($50,000). Information shall also be provided
concerning any work completed by a surety during this period.
   (G) In the case of a partnership or any association that is not a
legal entity, a copy of the agreement creating the partnership or
association and specifying that all partners or association members
agree to be fully liable for the performance under the job order
contract.
   (2) The information required under this subdivision shall be
verified under oath by the entity and its members in the manner in
which civil pleadings in civil actions are verified. Information that
is not a public record under the California Public Records Act
(Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code) shall not be open to public inspection.
   SEC. 3.    Section 20919.6 of the   Public
Contract Code   is amended to read: 
   20919.6.  (a) All work bid under the job order  contract
 shall comply with Chapter 4 (commencing with Section 4100)
of Part 1 of Division 2 and is subject to all of the penalties and
provisions set forth in that chapter.
   (b) For purposes of Article 60.3, if the primary job order
contractor chooses to use subcontractors, the primary job order
contractor is required to verify that the subcontractors possess the
appropriate licenses and credentials required to perform
construction.
   (c) Notwithstanding subdivision (a), the primary job order
contractor may use subcontractors that are not listed at the time
 of bid of  the job order  contract
 is issued  if the work to be performed under that
job order  contract  is less than ten thousand
dollars ($10,000).
   (d) If the primary job order contractor chooses to use a
subcontractor that is not listed at the time of bid to perform work
on a job order  contract that is less than ten thousand
dollars ($10,000)  , both of the following apply:
   (1) The  unified school district   primary
job order contractor  shall provide public notice of the
availability of work to be subcontracted by trade. The public notice
shall include the scope of work; the project location; the name,
address, and the telephone number of the primary job order
contractor; and the closing date, time, and location for sealed bids
to be submitted.
   (2) The primary job order contractor shall take sealed bids from
the subcontractors solicited for the proposal. These bids shall be
publicly opened at a prescribed time and place by the primary job
order contractor. After the bids are opened,  they shall be
forwarded to the unified school district which shall maintain them as
public records   the job order contractor shall notify
the unified school district which subcontractor was selected  .

   (e) If the primary job order contractor chooses to make a
substitution to the subcontractor list, the primary job order
contractor shall provide the unified school district with
justification as to the need for the substitution. The unified school
district may request a hearing to evaluate the substitution request.
 
   (e) 
    (   f)  If the unified school district
determines that there has been bid shopping by the primary job order
contractor, the unified school district  shall  
may  terminate the job order  contract  . If
the unified school district determines that a job order contractor
has violated  any provision set forth in  Chapter 4
(commencing with Section 4100) of Part 1 of Division 2, the unified
school district may declare the contractor ineligible  to bid
on job order contracts   for future job orders 
for a period of time to be determined by the unified school district.

   SEC. 4.    Section 20919.12 of the   Public
Contract Code   is amended to read: 
   20919.12.  If the unified school district adopts the job order
contracting process, the unified school district shall submit to the
Office of Public School Construction in the Department of General
Services, the Senate  Committee on Business, Professions and
Economic Development  and Assembly  Committees 
 Committee  on Business  , Professions  and
 Professions   Consumer Protection  , the
Senate and Assembly Committees on Education, and the Joint
Legislative Budget Committee before December  1, 2011
  31, 2019  , a report containing a description of
each job order contract procured, and the work under each contract
completed on or before  November 1, 2011   June
30, 2019  . The report shall be prepared by an independent third
party and the unified school district shall pay for the cost of the
report. The report shall include, but not be limited to, all of the
following information:
   (a) A listing of all projects completed under each job order
contract.
   (b) The job order contractor that was awarded each contract.
   (c) The estimated and actual project costs.
   (d) The estimated procurement time savings.
   (e) A description of any written protests concerning any aspect of
the solicitation, bid, proposal, or award of the job order contract,
including, but not limited to, the resolution of the protests.
   (f) An assessment of the prequalification process and criteria.
   (g) A description of the labor force compliance program required
under Section 20919.4, and an assessment of the impact on a project
where compliance with that program is required.
   (h) Recommendations regarding the most appropriate uses for the
job order contract process.
   SEC. 5.    Section 20919.15 of the   Public
Contract Code  is amended to read: 
   20919.15.  This article shall remain in effect only until December
 1, 2012   31, 2020  , and as of that date
is repealed, unless a later enacted statute, that is enacted before
December  1, 2012   31, 2020  , deletes or
extends that date. 
  SECTION 1.    Section 10108.8 of the Public
Contract Code is amended to read:
   10108.8.  The Department of Corrections and Rehabilitation shall
enter into two or more procurement contracts, where feasible, for the
purchase and development of the Business Information System (BIS)
Project. The BIS project shall be developed to allow integration with
other relevant statewide financial and personnel systems.