Bill Text: CA AB1517 | 2011-2012 | Regular Session | Chaptered
Bill Title: Public contracts: information technology goods and
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2012-08-27 - Chaptered by Secretary of State - Chapter 187, Statutes of 2012. [AB1517 Detail]
Download: California-2011-AB1517-Chaptered.html
BILL NUMBER: AB 1517 CHAPTERED
BILL TEXT
CHAPTER 187
FILED WITH SECRETARY OF STATE AUGUST 27, 2012
APPROVED BY GOVERNOR AUGUST 27, 2012
PASSED THE SENATE AUGUST 9, 2012
PASSED THE ASSEMBLY APRIL 26, 2012
INTRODUCED BY Assembly Member Buchanan
JANUARY 13, 2012
An act to amend and repeal Section 12112 of the Public Contract
Code, relating to public contracts.
LEGISLATIVE COUNSEL'S DIGEST
AB 1517, Buchanan. Public contracts: information technology goods
and services.
Existing law generally requires the Department of General
Services, for any contract for information technology goods or
services meeting specified requirements, to provide that not less
than 10% of the contract price is withheld until final delivery and
acceptance of the goods and services, and requires the department to
conduct a risk evaluation, as specified. Existing law, until July 1,
2013, requires the department, if it determines that lesser
withholding levels are appropriate based on the evaluation of risk,
to withhold no less than 5% of the contract price, if the contract
price is $10,000,000 or more, or no less than 3% of the contract
price, if the contract price is less than $10,000,000, until final
delivery and acceptance of the goods or services.
Existing law, operative until July 1, 2013, also requires the
Department of General Services, in consultation with the Department
of Finance, to develop and maintain criteria for the evaluation of
risk to the state that results from the acquisition of information
technology goods or services and requires the department to submit
the criteria developed and maintained for the evaluation of risk to
the state that results from the acquisition of information technology
goods and services to the Joint Legislative Budget Committee and to
the State Chief Information Officer, as specified. Existing law,
until July 1, 2013, requires the State Chief Information Officer to
review all contracts approved pursuant to this provision, as
specified, and to submit a report to the Legislature, as provided.
Existing law, commencing July 1, 2013, requires a contractor to
submit a faithful performance based in a specified sum.
This bill would delete the dates on which the above provisions
become inoperative and are repealed, and would make them operative
indefinitely. The bill would also remove the requirement that, on and
after July 1, 2013, a contractor submit a faithful performance bond.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 12112 of the Public Contract Code, as amended
by Section 5 of Chapter 19 of the Fourth Extraordinary Session of the
Statutes of 2009, is amended to read:
12112. (a) Any contract for information technology goods or
services, to be manufactured or performed by the contractor
especially for the state and not suitable for sale to others in the
ordinary course of the contractor's business may provide, on the
terms and conditions that the department deems necessary to protect
the state's interests, for progress payments for work performed and
costs incurred at the contractor's shop or plant, provided that not
less than 10 percent of the contract price is required to be withheld
until final delivery and acceptance of the goods or services.
Notwithstanding this subdivision, if the department determines that
lesser withholding levels are appropriate based upon an evaluation of
risk determined under subdivision (b) and the contract price is ten
million dollars ($10,000,000) or more, the department shall withhold
no less than 5 percent of the contract price until final delivery and
acceptance of the goods or services. If the department determines
that lesser withholding levels are appropriate based on an evaluation
of risk determined under subdivision (b) and the contract price is
less than ten million dollars ($10,000,000), the department shall
withhold no less than 3 percent of the contract price until final
delivery and acceptance of the goods or services.
(b) The department, in consultation with the Department of
Finance, shall develop and maintain criteria for the evaluation of
risk to the state that results from the acquisition of information
technology. This risk analysis shall determine the need for financial
protection that is in the best interest of the state, including, but
not limited to, any of the following:
(1) An acceptable performance bond as described in Chapter 2
(commencing with Section 995.010) of Title 14 of Part 2 of the Code
of Civil Procedure.
(2) Any surety as defined in Section 2787 of the Civil Code.
(3) A letter of credit as described in Division 5 (commencing with
Section 5101) of the Commercial Code.
(4) Protection in the form of contract terms.
(5) Any other form of security or guaranty of performance in an
amount sufficient to protect the state in the case of default by the
contractor providing information technology, or any other breach or
malfunction of the goods or services, or both.
(c) The department shall, on or before June 1, 2008, submit the
criteria developed and maintained pursuant to subdivision (b) to the
Joint Legislative Budget Committee and to the State Chief Information
Officer.
(d) The State Chief Information Officer shall, on or before July
1, 2012, do both of the following:
(1) Review and report to the Legislature on all contracts approved
pursuant to this section on and after January 1, 2008.
(2) Report to the Legislature any recommendations for changes to
this section or changes to the criteria developed and maintained by
the department pursuant to subdivision (b).
(e) For purposes of this section, "information technology" means
information technology goods or services, or both, as appropriate.
SEC. 2. Section 12112 of the Public Contract Code, as added by
Section 2 of Chapter 736 of the Statutes of 2007, is repealed.
