Bill Text: CA AB1734 | 2013-2014 | Regular Session | Amended
Bill Title: Public contracts: small business participation: disabled veterans.
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2014-05-23 - Joint Rule 62(a), file notice suspended. (Page 5065.) In committee: Set, second hearing. Held under submission. [AB1734 Detail]
Download: California-2013-AB1734-Amended.html
BILL NUMBER: AB 1734 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 23, 2014
INTRODUCED BY Assembly Member Jones-Sawyer
( Coauthors: Assembly Members
Chávez, Fox, and Melendez )
FEBRUARY 14, 2014
An act to add Section 14838.8 to the Government Code, to amend
Sections 999, 999.1, 999.2, 999.5, 999.12, and 1104 of , and to
add Section 999.14 to, the Military and Veterans Code, and to
amend Sections 10111, 10115, 10115.13, and 10115.15 of the
Public Contract Code, relating to public contracts.
LEGISLATIVE COUNSEL'S DIGEST
AB 1734, as amended, Jones-Sawyer. Public contracts: small
business participation: disabled veterans.
(1) The Small Business Procurement and Contract Act requires the
Director of General Services and the heads of other state agencies
that enter into contracts for the provision of goods, services, and
information technology and for the construction of state facilities
to establish goals for the participation of small businesses in these
contracts, to provide for small business preference in the award of
these contracts, to give special consideration and special assistance
to small businesses, and, whenever possible, to make awards to small
businesses, as specified.
This bill would require all state agencies, departments, boards,
and commissions to establish and achieve an annual goal of 25% small
business participation in state procurements and contracts, to ensure
that the state's procurement and contract processes are administered
in order to meet or exceed the goal, and to report to the Director
of General Services statistics regarding small business participation
in his or her the agency's
procurements and contracts.
The bill would require the Department of General Services to
monitor the progress of the agencies toward meeting the goal and to
provide this information to the Office of Small Business Advocate.
The bill would also require a state agency, department, board, or
commission that has not achieved the goal by the close of the fiscal
year to submit an implementation and a
corrective action plan to the Department of General Services within
45 days and every year thereafter as long as that agency
fails to meet or exceed the goal days . The bill
would require the department, in collaboration with the Office of
Small Business Advocate, to undertake reasonable means to assist
agencies in improving small business participation in their
contracting.
The bill would require all state agencies, departments, boards,
and commissions to work with the department to help small businesses
market their products, goods, and services to the state by providing
access to information about current bid opportunities on their
Internet Web sites.
The bill would also require the Office of Small Business Advocate
within the Governor's Office of Business and Economic Development to
collaborate with the Department of General Services to cooperatively
enhance the state's small business program by helping small
businesses access capital and other financial resources necessary to
successfully fulfill state contracts.
The bill applies would apply to all
state public entities that receive state public funding, including
the California State University, the University of California, and
the California Community Colleges. In calculating the total amount of
contracting covered by this bill, the California State University,
the University of California, and the California Community Colleges
will would only be required to meet the
25% goal for state funding used in contracting.
(2) Existing law requires a state agency, department, officer, or
other state governmental entity, to meet an annual statewide
participation goal of not less than 3% for disabled veteran business
enterprises for specified contracts entered into by the awarding
department during the year.
This The bill would gradually
increase that participation goal to 5% by the 2017-18
fiscal year. The bill would require contracts awarded by any state
agency, department, officer, or other state governmental
entity for goods, services, or information technology for which the
expected bid could be over $100,000,000 to have this participation
goal, unless the Department of General Services certifies, prior to
the issuance of bid requests, that the state agency, department,
officer, or other state governmental entity met its disabled veteran
business enterprise goal in prior fiscal years, as specified, and
will likely meet its disabled veteran business enterprise goal in the
current fiscal year .
(3) Existing law requires the Director of General Services to
adopt written policies and guidelines for state contracting that
would provide a disabled veteran business enterprise participation
incentive to bidders.
The bill would require the incentive provided to a disabled
veteran business enterprise prime contractor to be higher than the
incentive provided to a prime contractor that is not a disabled
veteran business enterprise but that has agreed to use a disabled
veteran business enterprise subcontractor.
(4) Existing law specifies the duties of the Department of
Veterans Affairs with respect to the implementation of the Disabled
Veteran Enterprise Program, including, among other things, a
requirement to establish a system to track the effectiveness of its
efforts to promote the program.
The bill would require the department to include in the tracking
system a record of those businesses that became certified disabled
veteran business enterprises and participated in a state contract
within 2 years following the date of a promotional effort.
(5) Existing law requires the Secretary of the Department of
Veterans Affairs to appoint a California Disabled Veteran Business
Enterprise Program Advocate, and each awarding department to appoint
an agency Disabled Veteran Business Enterprise Program Advocate, and
requires each advocate to perform certain duties relating to the
implementation of the of the Disabled Veteran Enterprise Program.
This bill would require the California Disabled Veteran Business
Enterprise Program advocate to perform additional duties, including
meeting regularly with, and assisting, agency Disabled Veteran
Business Enterprise Program Advocates, serving as an advocate for the
disabled veteran business enterprises, and reporting to the Office
of Small Business and Disabled Veteran Business Enterprise Services,
as specified. This bill would also require each agency Disabled
Veteran Business Enterprise Program Advocate to perform additional
duties, including maintaining records of promotional efforts hosted
or attended by each agency Disabled Veteran Business Enterprise
Program Advocate, as specified, and indicating which of these
businesses became certified disabled veteran business enterprises and
participated in a state contract.
(6) Existing law requires the Department of General Services to
make available a report on state agency contracting activity
containing certain information.
This bill would require the department, for any contracting
activity occurring on or after July 1, 2015, to include in that
report information of the use of disabled veteran business enterprise
utilization plans, as specified. The bill would prohibit the
department from approving a vendor's utilization plan unless the
vendor agrees to provide the department with any information the
department deems necessary to meet these reporting requirements.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 14838.8 is added to the Government Code, to
read:
14838.8. In order to encourage small business participation in
state contracts, all state agencies, departments, boards, and
commissions shall establish and achieve an annual goal of 25 percent
small business participation in state procurements and contracts.
(a) Notwithstanding any other provision of this chapter, the heads
of all state agencies, departments, boards, and commissions shall
ensure that the state's procurement and contract processes are
administered in order to meet or exceed the 25 percent small business
participation goal, and shall report to the Director of General
Services statistics regarding small business annual participation in
his or her agency's procurements and contracts.
(b) The Department of General Services shall monitor the progress
of all state agencies, departments, boards, and commissions toward
meeting the 25 percent small business participation goal. The
department shall regularly share information with the Office of Small
Business Advocate on the progress of each individual agency,
department, board, and commission in meeting the annual goal,
including, but not limited to, providing copies of corrective action
plans.
(c) (1) A state agency, department, board, or commission that has
not achieved the 25 percent small business participation goal by the
close of the fiscal year shall submit an implementation and
a corrective action plan to the Department of
General Services within 45 days and annually thereafter as
long as that agency fails to meet or exceed the goal
days .
(2) The Department of General Services, in collaboration with the
Office of Small Business Advocate, shall undertake reasonable means
to assist agencies in improving small business participation in their
contracting, including entering into memoranda of understanding with
the agencies that have not met the goal to improve performance.
(d) All state agencies, departments, boards, and commissions shall
use the contracting procedure authorized in Section 14838
14838.5 to contract with small businesses for
goods and services contracts under one hundred thousand dollars
($100,000) and construction contracts under one hundred twenty
thousand dollars ($120,000) whenever possible.
(e) The Department of General Services shall actively promote
small business certification, help small businesses market their
products, goods, and services to the state, and promote the use of
technologies and other innovative solutions for notifying small
businesses of state contracting opportunities, including, but not
limited to, the Subscription Outreach Service of the California State
Contracts Register.
(f) The Department of General Services shall collaborate with the
Office of the Small Business Advocate in the office's work to assist
small businesses access capital and other financial resources
necessary to successfully fulfill state contracts.
(g) This section applies to all state agencies, departments,
boards, commissions, and other state public entities that receive
state funding including the University of California, the California
State University, and the California Community Colleges. In
calculating the total amount of contracting covered by this section,
the University of California, the California State University, and
the California Community Colleges shall only be required to meet the
25 percent-goal for state funding used in contracting.
SEC. 2. Section 999 of the Military and Veterans Code is amended
to read:
999. (a) This article shall be known as, and may be cited as, the
California Disabled Veteran Business Enterprise Program. The
California Disabled Veteran Business Enterprise Program is
established to address the special needs of disabled veterans seeking
rehabilitation and training through entrepreneurship and to
recognize the sacrifices of Californians disabled during military
service. It is the intent of the Legislature that every state
procurement authority honor California's disabled veterans by taking
all practical actions necessary to meet or exceed the disabled
veteran business enterprise participation goal of a minimum of 5
percent of total contract value.
(b) As used in this article, the following definitions apply:
(1) "Administering agency" means the Treasurer in the case of
contracts for professional bond services, and the Department of
General Services' Office of Small Business and Disabled Veteran
Business Enterprise Services, in the case of contracts governed by
Section 999.2.
(2) "Awarding department" means a state agency, department,
governmental entity, or other officer or entity empowered by law to
issue bonds or enter into contracts on behalf of the state.
(3) "Bonds" means bonds, notes, warrants, certificates of
participation, and other evidences of indebtedness issued by, or on
behalf of, the state.
(4) "Contract" includes any agreement or joint agreement to
provide professional bond services to the State of California or an
awarding department. "Contract" also includes any agreement or joint
development agreement to provide labor, services, materials,
supplies, or equipment in the performance of a contract, franchise,
concession, or lease granted, let, or awarded for, and on behalf of,
the state.
(5) (A) "Contractor" means any person or persons, regardless of
race, color, creed, national origin, ancestry, sex, marital status,
disability, religious or political affiliation, age, or any sole
proprietorship, firm, partnership, joint venture, corporation, or
combination thereof that submits a bid and enters into a contract
with a representative of a state agency, department, governmental
entity, or other officer empowered by law to enter into contracts on
behalf of the state. "Contractor" includes any provider of
professional bond services who enters into a contract with an
awarding department.
(B) "Disabled veteran business enterprise contractor,
subcontractor, or supplier" means any person or entity that has been
certified by the administering agency pursuant to this article and
that performs a "commercially useful function," as defined below, in
providing services or goods that contribute to the fulfillment of the
contract requirements:
(i) A person or an entity is deemed to perform a "commercially
useful function" if a person or entity does all of the following:
(I) Is responsible for the execution of a distinct element of the
work of the contract.
(II) Carries out the obligation by actually performing, managing,
or supervising the work involved.
(III) Performs work that is normal for its business services and
functions.
(IV) Is responsible, with respect to products, inventories,
materials, and supplies required for the contract, for negotiating
price, determining quality and quantity, ordering, installing, if
applicable, and making payment.
(V) Is not further subcontracting a portion of the work that is
greater than that expected to be subcontracted by normal industry
practices.
(ii) A contractor, subcontractor, or supplier will not be
considered to perform a "commercially useful function" if the
contractor's, subcontractor's, or supplier's role is limited to that
of an extra participant in a transaction, contract, or project
through which funds are passed in order to obtain the appearance of a
disabled veteran business enterprise participation.
(6) "Disabled veteran" means a veteran of the military, naval, or
air service of the United States, including, but not limited to, the
Philippine Commonwealth Army, the Regular Scouts, "Old Scouts," and
the Special Philippine Scouts, "New Scouts," who has at least a
10-percent service-connected disability and who is domiciled in the
state.
(7) (A) "Disabled veteran business enterprise" means a business
certified by the administering agency as meeting all of the following
requirements:
(i) It is a sole proprietorship at least 51-percent owned by one
or more disabled veterans or, in the case of a publicly owned
business, at least 51 percent of its stock is unconditionally owned
by one or more disabled veterans; a subsidiary that is wholly owned
by a parent corporation, but only if at least 51 percent of the
voting stock of the parent corporation is unconditionally owned by
one or more disabled veterans; or a joint venture in which at least
51 percent of the joint venture's management, control, and earnings
are held by one or more disabled veterans.
(ii) The management and control of the daily business operations
are by one or more disabled veterans. The disabled veterans who
exercise management and control are not required to be the same
disabled veterans as the owners of the business.
(iii) It is a sole proprietorship, corporation, or partnership
with its home office located in the United States, which is not a
branch or subsidiary of a foreign corporation, foreign firm, or other
foreign-based business.
(B) Notwithstanding subparagraph (A), after the death or the
certification of a permanent medical disability of a disabled veteran
who is a majority owner of a business that qualified as a disabled
veteran business enterprise prior to that death or certification of a
permanent medical disability, and solely for purposes of any
contract entered into before that death or certification, that
business shall be deemed to be a disabled veteran business enterprise
for a period not to exceed three years after the date of that death
or certification of a permanent medical disability, if the business
is inherited or controlled by the spouse or child of that majority
owner, or by both of those persons.
(8) "Foreign corporation," "foreign firm," or "foreign-based
business" means a business entity that is incorporated or has its
principal headquarters located outside the United States of America.
(9) "Goal" means a numerically expressed objective that awarding
departments and contractors are required to make efforts to achieve.
(10) "Management and control" means effective and demonstrable
management of the business entity.
(11) "Professional bond services" include services as financial
advisers, bond counsel, underwriters in negotiated transactions,
underwriter's counsel, financial printers, feasibility consultants,
and other professional services related to the issuance and sale of
bonds.
SEC. 3. Section 999.1 of the Military and Veterans Code is amended
to read:
999.1. (a) (1) Notwithstanding any other provision of law, each
awarding department shall have annual statewide participation goals
of not less than 5 percent as
specified in paragraph (2) of subdivision (a) of Section 999.2
for disabled veteran business enterprises for contracts entered into
by the awarding department during the year for professional bond
services. This section shall not apply if a contract for professional
bond services of an underwriter is to be obtained by competitive
bid. However, each awarding department shall establish goals for
contracts to be obtained by competitive bid for professional bond
services.
(2) These goals shall apply to the overall dollar amount expended
by the awarding department with respect to the contracts for
professional bond services relating to the issuance of bonds by the
awarding department, including amounts spent as underwriter's
discounts.
(b) In attempting to meet the goals set forth in subdivision (a),
the awarding department shall consider establishing cocounsel, joint
venture, and subcontracting relationships, including disabled veteran
business enterprises, in all contracts for professional bond
services. It shall be the responsibility of the head of each awarding
department to be supportive of the Treasurer's program for assigning
representative portions of professional bond services contracts for
purposes of meeting the goals established pursuant to this section.
However, nothing in this article shall preclude the awarding
department from achieving the goals set forth in this section without
requiring joint ventures, cocounsel, or subcontracting arrangements.
(c) This section shall not limit the ability of any awarding
department to meet a goal higher than those set forth in subdivision
(a) for the participation of disabled veteran business enterprises in
contracts awarded by the awarding department.
SEC. 4. Section 999.2 of the Military and Veterans Code is amended
to read:
999.2. (a) (1) Notwithstanding any other
provision of law, contracts awarded by any state
agency, department, officer, or other state governmental entity,
including school districts when they are expending state funds for
construction, professional services (except those subject to Chapter
6 (commencing with Section 16850) of Part 3 of Division 4 of Title 2
of the Government Code), materials, supplies, equipment, alteration,
repair, or improvement shall have statewide participation goals
of not less than 5 percent as specified in
paragraph (2) for disabled veteran business enterprises. These
goals apply to the overall dollar amount expended each year by the
awarding department.
(2) Statewide participation goals for contracts specified in
paragraph (1) shall be as follows:
(A) For the 2014-15 fiscal year, not less than 3.5 percent.
(B) For the 2015-16 fiscal year, not less than 4 percent.
(C) For the 2016-17 fiscal year, not less than 4.5 percent.
(D) For the 2017-18 fiscal year, and each fiscal year thereafter,
not less than 5 percent.
(b) For purposes of this section:
(1) "Broker" or "agent" means any individual or entity, or any
combination thereof, that does not have title, possession, control,
and risk of loss of materials, supplies, services, or equipment
provided to an awarding department, unless one or more certified
disabled veterans has 51-percent ownership of the quantity and value
of the materials, supplies, services, and of each piece of equipment
provided under the contract.
(2) "Equipment" means any piece of equipment that is used or
provided for rental to any state agency, department, officer, or
other state governmental entity, including equipment for which
operators are provided.
(3) "Equipment broker" means any broker or agent who rents
equipment to an awarding department.
(c) A disabled veteran business enterprise that rents equipment to
an awarding department shall be deemed to be an equipment broker
unless one or more disabled veterans has 51-percent ownership of the
quantity and the value of each piece of equipment. If the equipment
is owned by one or more disabled veterans, each disabled veteran
owner shall, prior to performance under any contract, submit to the
awarding department a declaration signed by the disabled veteran
owner stating that the owner is a disabled veteran and providing the
name, address, telephone number, and tax identification number of the
disabled veteran owner. Each disabled veteran owner shall submit his
or her federal income tax returns to the administering agency
pursuant to subdivision (g) as if he or she were a disabled veteran
business enterprise. The disabled veteran business enterprise of a
disabled veteran owner who fails to submit his or her tax returns
will be deemed to be an equipment broker.
(d) A disabled veteran business enterprise that rents equipment to
an awarding department shall, prior to performing the contract,
submit to the awarding department a declaration signed by each
disabled veteran owner and manager of the enterprise stating that the
enterprise obtained the contract by representing that the enterprise
was a disabled veteran business enterprise meeting and maintaining
all of the requirements of a disabled veteran business enterprise.
The declaration shall include the name, address, telephone number,
and tax identification number of the owner of each piece of equipment
identified in the contract.
(e) State funds expended for equipment rented from equipment
brokers pursuant to contracts awarded under this section shall not be
credited toward the 5-percent goal goals
specified in paragraph (2) of subdivision (a) .
(f) A disabled veteran business enterprise that is a broker or
agent and that obtains a contract pursuant to subdivision (a) shall,
prior to performing the contract, disclose to the awarding department
that the business is a broker or agent. The disclosure shall be made
in a declaration signed and executed by each disabled veteran owner
and manager of the enterprise, declaring that the enterprise is a
broker or agent, and identifying the name, address, and telephone
number of the principal for whom the enterprise is acting as a broker
or agent.
(g) (1) A disabled veteran business enterprise, and each owner
thereof, shall, at the time of certification, submit to the
administering agency complete copies of the enterprise's federal
income tax returns for the three previous tax years.
(2) A disabled veteran business enterprise, and each owner
thereof, shall submit to the administering agency complete copies of
the enterprise's federal income tax returns that have a
postcertification due date, on or before the due date, including
extensions.
(3) A disabled veteran business enterprise that, and each owner
thereof who, has not submitted to the administering agency complete
copies of the enterprise's federal income tax returns for the three
tax years preceding certification nor for each postcertification tax
year for which a return was required to be filed, shall have 90 days
to submit those returns.
(4) A disabled veteran business enterprise that fails to comply
with any provision of this subdivision shall be prohibited from
participating in any state contract until the disabled veteran
business enterprise complies with the provisions of this subdivision.
Funds expended involving a disabled veteran business enterprise
during any period in which that enterprise is not in compliance with
the provisions of this subdivision shall not be credited toward the
awarding department's 5-percent goal goals
specified in paragraph (2) of subdivision (a) .
(h) A disabled veteran business enterprise that fails to maintain
the certification requirements set forth in this article shall
immediately notify the awarding department and the administering
agency of that failure by filing a notice of failure that states with
particularity each requirement the disabled veteran business
enterprise has failed to maintain.
SEC. 5. Section 999.5 of the Military and Veterans Code is amended
to read:
999.5. (a) The administering agency for the California Disabled
Veteran Business Enterprise Program is the Department of General
Services, except in the case of contracts for professional bond
services. The Department of General Services shall consult with the
California Disabled Veteran Business Enterprise Program Advocate,
appointed by the Secretary of the Department of Veterans Affairs
pursuant to Section 999.11, on all matters relating to the California
Disabled Veteran Business Enterprise Program. The
(b) The Director of General
Services shall adopt written policies and guidelines establishing a
uniform process for state contracting that would provide a disabled
veteran business enterprise participation incentive to bidders.
The incentive provided to a disabled veteran business enterprise
prime contractor shall be higher than the incentive provided to a
prime contractor that is not a disabled veteran business enterprise
but that has agreed to use a disabled veteran business enterprise
subcontractor. The incentive program shall be used by all state
agencies when awarding contracts.
(b)
(c) The Department of Veterans Affairs shall do all of
the following:
(1) Establish a method of monitoring adherence to the goals
specified in Sections 999.1 and 999.2.
(2) Promote the California Disabled Veteran Business Enterprise
Program to the fullest extent possible.
(3) Maintain complete records of its promotional efforts ,
including, but not limited to, the name, location, size, and type of
business attending or participating in a promotional effort .
(4) Establish a system to track the effectiveness of its efforts
to promote the California Disabled Veteran Business Enterprise
Program, which shall include regular, both of
the following:
(A) A record of those businesses that became certified disabled
veteran business enterprises and participated in a state contract as
either a prime contractor or as a subcontractor within two years
following the date of a promotional effort.
(B) Regular, periodic surveys of
newly certified disabled veteran business enterprises to determine
how they learned of the program, why they became certified, and what
their experience with awarding departments has been.
(d) The California Disabled Veteran Business Enterprise Program
Advocate shall, in furtherance of the duties required by subdivision
(c) and Section 999.11, do all of the following:
(1) Meet regularly with agency Disabled Veteran Business
Enterprise Program Advocates and contract and procurement staffs of
their departments to disseminate information about the California
Disabled Veteran Business Enterprise.
(2) Assist agency Disabled Veteran Business Enterprise Program
Advocates with their requirement to assist contract officers pursuant
to subdivision (b) of Section 999.12.
(3) Serve as an advocate for the disabled veteran business
enterprises that are utilized as the agency's contractors or
subcontractors.
(4) Report to the Office of Small Business and Disabled Veteran
Business Enterprise Services regarding any violation of this article.
(c)
(e) An awarding department shall not credit toward the
department's 5-percent goal goals specified
in paragraph (2) of subdivision (a) of Section 999.2 state
funds expended on a contract with a disabled veteran business
enterprise that does not meet and maintain the certification
requirements.
(d)
(f) Upon completion of an awarded contract for which a
commitment to achieve a disabled veteran business enterprise goal was
made, an awarding department shall require the prime contractor that
entered into a subcontract with a disabled veteran business
enterprise to certify to the awarding department all of the
following:
(1) The total amount the prime contractor received under the
contract.
(2) The name and address of the disabled veteran business
enterprise that participated in the performance of the contract.
(3) The amount each disabled veteran business enterprise received
from the prime contractor.
(4) That all payments under the contract have been made to the
disabled veteran business enterprise. An awarding department shall
keep that certification on file. A person or entity that knowingly
provides false information shall be subject to a civil penalty for
each violation in the minimum amount of two thousand five hundred
dollars ($2,500) and the maximum amount of twenty-five thousand
dollars ($25,000). An action for a civil penalty under this
subdivision may be brought by any public prosecutor in the name of
the people of the State of California and the penalty imposed shall
be enforceable as a civil judgment.
(e)
(g) A prime contractor may, subject to the approval of
the Department of General Services, replace a disabled veteran
business enterprise identified by the prime contractor in its bid or
offer, pursuant to subdivision (a) of Section 999.10, with another
disabled veteran business enterprise.
(f)
(h) The administering agency shall adopt rules and
regulations , including standards for good faith efforts,
for the purpose of implementing this section. Emergency
regulations consistent with this section may be adopted.
SEC. 6. Section 999.12 of the Military and Veterans Code is
amended to read:
999.12. Each awarding department shall appoint an agency Disabled
Veteran Business Enterprise Program Advocate. This person shall be
the same individual appointed pursuant to Section 14846 of the
Government Code. The agency Disabled Veteran Business Enterprise
Program Advocate shall do all of the following:
(a) Assist certified disabled veteran business enterprises in
participating in that agency's contracting process.
(b) Assist contract officers in seeking disabled veteran business
enterprises to participate in the agency's contract and procurement
activities by performing outreach efforts to recruit disabled veteran
business enterprises to offer their services as either a prime
contractor or subcontractor on any contract proposed by the awarding
department that requires disabled veteran business enterprise
participation, and by other feasible means.
(c) Meet regularly with the California Disabled Veteran Business
Enterprise Program Advocate and contract and procurement staffs of
their departments to disseminate information about the California
Disabled Veteran Business Enterprise Program.
(d) Serve as an advocate for the disabled veteran business
enterprises that are utilized as the agency's contractors or
subcontractors.
(e) Report to the Office of Small Business and Disabled Veteran
Business Enterprise Services regarding any violation of this article.
(f) Coordinate and meet, on a regular basis, with the California
Disabled Veteran Business Enterprise Program Advocate at the
Department of Veterans Affairs in an effort to meet the statewide
5-percent goal goals provided for in
paragraph (2) of subdivision (a) of Section 999.2.
(g) Maintain records of the promotional efforts hosted or attended
by each agency Disabled Veteran Business Enterprise Program
Advocate, including the name, location, size, and type of business
attending or participating in an event. The records shall also
indicate which of these businesses became certified disabled veteran
business enterprises and participated in a state contract as either a
prime contractor or as a subcontractor within two years following
the date of a promotional effort.
SEC. 7. Section 999.14 is added to the
Military and Veterans Code , to read:
999.14. Notwithstanding any other law, contracts awarded by any
state agency, department, officer, or other state
governmental entity for goods,
services, or information technology for which the expected bid could
be over one hundred million dollars ($100,000,000) shall have a
statewide participation goal as specified in paragraph (2) of
subdivision (a) of Section 999.2, unless the Department of General
Services certifies, prior to the issuance of bid requests, that the
state agency, department, officer, or other state governmental entity
met their disabled veteran business enterprise goal for two out of
the three previous fiscal years, including the prior fiscal year, and
will likely meet their disabled veteran business enterprise goal in
the current fiscal year.
SEC. 7. SEC. 8. Section 1104 of the
Military and Veterans Code is amended to read:
1104. (a) Upon appropriation by the Legislature, money in the
fund shall be used by the Department of Veterans Affairs for the
purpose of designing and constructing veterans' homes in California
and completing a comprehensive renovation of the Veterans' Home at
Yountville. Funding from this bond shall be allocated to fund the
state's matching requirement to construct or renovate those veterans'
homes in Section 1011 first, and then fund any additional homes
established under this section. These homes shall be in addition to
sites authorized under Section 1011.
(b) Notwithstanding any other provision of law,
construction contracts awarded for veterans' homes shall have a
statewide participation goal of not less than 5 percent
as specified in paragraph (2) of
subdivision (a) of Section 999.2 for disabled veteran business
enterprises, as defined in Section 999.
SEC. 9. Section 10111 of the Public
Contract Code is amended to read:
10111. Commencing January 1, 2007, the department shall make
available a report on contracting activity containing the following
information:
(a) A listing of consulting services contracts that the state has
entered into during the previous fiscal year. The listing shall
include the following:
(1) The name and identification number of each contractor.
(2) The type of bidding entered into, the number of bidders,
whether the low bidder was accepted, and if the low bidder was not
accepted, an explanation of why another contractor was selected.
(3) The amount of the contract price.
(4) Whether the contract was a noncompetitive bid contract, and
why the contract was a noncompetitive bid contract.
(5) Justification for entering into each consulting services
contract.
(6) The purpose of the contract and the potential beneficiaries.
(7) The date when the initial contract was signed, and the date
when the work began and was completed.
(b) The report shall also include a separate listing of consultant
contracts completed during that fiscal year, with the same
information specified in subdivision (a).
(c) The information specified in subdivisions (a) and (b) shall
also include a list of any contracts underway during that fiscal year
on which a change was made regarding the following:
(1) The completion date of the contract.
(2) The amount of money to be received by the contractor, if it
exceeds 3 percent of the original contract price.
(3) The purpose of the contract or duties of the contractor. A
brief explanation shall be given if the change in purpose is
significant.
(d) The level of participation, by agency, of disabled veteran
business enterprises in statewide contracting and shall include
dollar values of contract award for the following categories:
(1) Construction.
(2) Architectural, engineering, and other professional services.
(3) Procurement of materials, supplies, and equipment.
(4) Information technology procurements.
Additionally, the report shall include a statistical summary
detailing each awarding department's goal achievement and a statewide
total of those goals.
(e) The level of participation by small business in state
contracting including:
(1) Upon request, an up-to-date list of eligible small business
bidders by general procurement and construction contract categories,
noting company names and addresses and also noting which small
businesses also qualify as microbusinesses.
(2) By general procurement and construction contract categories,
statistics comparing the small business and microbusiness contract
participation dollars to the total state contract participation
dollars.
(3) By awarding department and general procurement and
construction categories, statistics comparing the small business and
microbusiness contract participation dollars to the total state
contract participation dollars.
(4) Any recommendations for changes in statutes or state policies
to improve opportunities for small businesses and microbusinesses.
(5) A statistical summary of small businesses and microbusinesses
certified for state contracting by the number of employees at the
business for each of the following categories: 0-5, 26-50, 51-75, and
76-100.
(6) To the extent feasible, beginning in the year 2008, the number
of contracts awarded by the department in the categories specified
in paragraph (5).
(7) The number of contracts and dollar amounts awarded annually
pursuant to Section 14838.5 of the Government Code to small
businesses, microbusinesses, and disabled veteran business
enterprises.
(f) The level of participation of business enterprises, by race,
ethnicity, and gender of the owner, in contracts to the extent that
the information has been voluntarily reported to the department. In
addition, the report shall contain the levels of participation of
business enterprises, by race, ethnicity, and gender of the owner,
and whether the business is a lesbian, gay, bisexual, or transgender
owned business for the following categories of contracts, to the
extent that the information has been voluntarily reported to the
department:
(1) Construction.
(2) Purchases of materials, supplies, or equipment.
(3) Professional services.
(g) In the years 2011 and 2012, any errors reported to the
department by an awarding agency as required by Sections 10302,
10344, and 12104.5, in the previous fiscal year.
(h) For contracting activity occurring on or after July 1, 2015,
the use of disabled veteran business enterprise utilization plans as
provided by Section 10115.15. The report shall identify, by awarding
department, the number and financial value of contracts awarded based
upon a disabled veteran business enterprise utilization plan, the
percentage of disabled veteran business enterprise work committed to
in the utilization plan, the number of audits conducted pursuant to
subdivision (b) of Section 10115.15, the number of disapprovals of
disabled veteran business enterprise utilization plans pursuant to
subdivision (c) of Section 10115.15, and any other enforcement
activities relating to disabled veteran business enterprise
utilization plans during the reporting period.
(h)
(i) The amendments made to this section by the
act adding this subdivision by Chapter 861 of the
Statutes of 2012 shall apply on and after January 1,
2013.
SEC. 8. SEC. 10. Section 10115 of
the Public Contract Code is amended to read:
10115. (a) The Legislature finds and declares all of the
following:
(1) The essence of the American economic system of private
enterprise is free competition. Only through full and free
competition can free markets, reasonable and just prices, free entry
into business, and opportunities for the expression and growth of
personal initiative and individual judgment be assured. The
preservation and expansion of that competition is basic to the
economic well-being of this state and that well-being cannot be
realized unless the actual and potential capacity of minority, women,
and disabled veteran business enterprises is encouraged and
developed. Therefore, it is the declared policy of the state to aid
the interests of minority, women, and disabled veteran business
enterprises in order to preserve reasonable and just prices and a
free competitive enterprise, to ensure that a fair proportion of the
total number of contracts or subcontracts for commodities, supplies,
technology, property, and services are awarded to minority, women,
and disabled veteran business enterprises, and to maintain and
strengthen the overall economy of the state.
(2) The opportunity for full participation in our free enterprise
system by minority, women, and disabled veteran business enterprises
is essential if this state is to attain social and economic equality
for those businesses and improve the functioning of the state
economy.
(3) State agencies which have established short- and long-range
minority, women, and disabled veteran participation goals are
awarding 23 percent or more of their contracts to these business
enterprises.
(4) It is in the state's interest to expeditiously improve the
economically disadvantaged position of minority, women, and disabled
veteran business enterprises.
(5) The economic position of these businesses can be improved by
providing long-range substantial goals for procurement by state
agencies of commodities, professional services, and construction work
from minority, women, and disabled veteran businesses.
(6) Procurement by state agencies of goods and services from these
businesses also benefits the state agencies and the citizens of the
state by encouraging the expansion of the number of vendors for
procurements, thereby encouraging competition among the vendors and
promoting economic efficiency in the process.
(b) It is the purpose of this article to do all of the following:
(1) Encourage greater economic opportunity for minority, women,
and disabled veteran business enterprises.
(2) Promote competition among state agencies in order to enhance
long-term economic efficiency in the procurement of construction,
commodities, and professional services contracts.
(3) Clarify and expand the program for the procurement by state
agencies of commodities, professional services, and construction work
from minority, women, and disabled veteran business enterprises.
(c) Notwithstanding any other law, contracts awarded by any state
agency, department, officer, or other state governmental entity for
construction, professional services (except those subject to Chapter
6 (commencing with Section 16850) of Part 3 of Division 4 of Title 2
of the Government Code), materials, supplies, equipment, alteration,
repair, or improvement shall have statewide participation goals of
not less than 15 percent for minority business enterprises, not less
than 5 percent for women business enterprises , and
5 percent the percentages specified in
paragraph (2) of subdivision (a) of Secti on 999.2 of the
Military and Veterans Code for disabled veteran business
enterprises. These goals apply to the overall dollar amount expended
each year by the awarding department, as defined by Section 10115.1,
pursuant to this article.
SEC. 9. SEC. 11. Section 10115.13 of
the Public Contract Code is amended to read:
10115.13. Notwithstanding any other law, contracts awarded by any
state agency, department, officer, or other state governmental
entity for the purchase of general public advertisements shall have
statewide participation goals of not less than 15 percent for
minority business enterprises, not less than five
5 percent for women business enterprises, and
five percent the percentages specified in paragraph
(2) of subdivision (a) of Section 999.2 of the Military and
Veterans Code for disabled veteran business enterprises.
These goals apply to the overall dollar amount expended each year by
the awarding state agency, department, offices, or other state
governmental entity.
SEC. 10. SEC. 12. Section 10115.15
of the Public Contract Code is amended to read:
10115.15. (a) Notwithstanding Section 10115.2, when awarding
contracts for materials, supplies, or equipment, including electronic
data processing goods and services, an awarding department shall
accept the submission by a bidder of a minority, women, and disabled
veteran business enterprise utilization plan that has been approved
prior to the solicitation due date by the Department of General
Services. A business utilization plan shall be considered approved by
the Department of General Services as of the date submitted to the
department so long as the plan meets the minimum criteria established
in paragraphs (1) to (12), inclusive, and shall be valid for a
period of one year, unless the department has audited the utilization
plan, as authorized under subdivision (b), and disapproves it for
reasons specified under subdivision (c). The decision of whether to
establish a minority, women, and disabled veteran business enterprise
utilization plan shall be at the option of the vendor. If a bidder
cites an approved utilization plan in response to the minority,
women, and disabled veteran business enterprise participation
requirements of a solicitation that calls for 15 percent
minority-owned, 5 percent women-owned, and 5 percent
the percentages specified in paragraph (2) of
subdivision (a) of Section 999.2 of the Military and Veterans Code
for disabled veteran-owned business participation, then that
utilization plan shall be considered responsive to the participation
goals of the solicitation document. If a solicitation specifies
higher participation goals than those in the bidder's utilization
plan, the bidder shall meet the goals in the solicitation. At a
minimum, the utilization plan shall include the following
information:
(1) A statement of the vendor's minority, women, and disabled
veteran business enterprise utilization plan, including the primary
objectives of the utilization plan.
(2) An explanation showing sufficient business reasons why the
vendor did not meet minority, women, and disabled veteran business
enterprise participation goals set forth in the vendor's minority,
women, and disabled veteran business utilization plan submitted to,
and approved by, the Department of General Services in the previous
year, if applicable. Further, if the vendor did not meet the
minority, women, and disabled veteran business participation goals in
the previous year, the vendor shall also identify remedial steps it
will take to meet the goals in the current utilization plan.
(3) A statement of the vendor's minority, women, and disabled
veteran business utilization goals for the succeeding year. At a
minimum, these utilization goals shall be equal to the statewide
participation goals set forth in subdivision (c) of Section 10115.
(4) Estimated total dollars to be subcontracted by the vendor for
sales within the United States for the succeeding year.
(5) Estimated total dollars to be subcontracted by the vendor for
sales within the State of California for the succeeding year.
(6) Total dollars expressed as a percentage of the amount
estimated pursuant to paragraph (4), intended to be subcontracted
with each of the following:
(A) Minority business enterprises.
(B) Women business enterprises.
(7) Total dollars, expressed as a percentage of the amount
estimated pursuant to paragraph (5), intended to be subcontracted
with disabled veteran-owned business enterprises.
(8) A representative listing of the products and services that the
vendor anticipates subcontracting, including an identification of
the types of subcontracting planned for minority, women, and disabled
veteran business enterprises.
(9) The name of the individual employed by the vendor who will
administer the vendor's utilization plan, including a description of
the duties of the individual.
(10) A description of the efforts that the vendor will undertake
to ensure that minority, women, and disabled veteran business
enterprises will have an equitable opportunity to compete for
contracts.
(11) A listing of the records and reports that the vendor will
maintain to demonstrate the practices and procedures that have been
adopted to comply with the requirements and goals of the utilization
plan.
(12) Affirmation that the vendor met the statewide minority,
women, and disabled veteran business enterprise utilization goals for
the previous year, if applicable.
(b) The Department of General Services shall conduct random audits
of the submitted utilization plans to determine compliance with this
article, and shall retain on file all submitted utilization plans
for auditing purposes. During any audit of a submitted utilization
plan, the Department of General Services may ask a vendor to submit a
list of all the minority, women, and disabled veteran business
enterprises included as subcontractors in the vendor's plan for the
previous year. This information shall remain confidential. Nothing in
this section shall be construed to require the Department of General
Services to audit all of the minority, women, and disabled veteran
business enterprise utilization plans submitted by individual
vendors. The Department of General Services may establish appropriate
fees to cover the actual costs of conducting random audits and
retaining on file all submitted plans.
(c) (1) At any time, the Department of General Services may
disapprove a vendor's minority, women, and disabled veteran business
enterprise utilization plan for any of the following reasons:
(A) The utilization plan fails to evidence a vendor's intention to
comply fully with the statewide minority, women, and disabled
veteran business enterprise goals for the succeeding year, as
indicated by failure of the utilization plan to contain the
information specified in subdivision (a).
(B) The utilization plan fails to evidence sufficient business
reasons for failure to achieve the minority, women, and disabled
veteran business enterprise goals set forth in a utilization plan
submitted in the previous year, if applicable.
(C) The utilization plan fails to evidence sufficient remedial
steps the vendor will take if the vendor did not meet the minority,
women, and disabled veteran business participation goals in the
previous year, if applicable.
(2) If a vendor's utilization plan is disapproved, the vendor may
not submit a new utilization plan to the department for a period of
one year from the date of disapproval. Prior to disapproval of a
vendor's utilization plan, the vendor shall be entitled to a public
hearing and to five days' notice of the time and place thereof. The
notice shall state the reasons for the hearing.
(3) A vendor that submits a minority, women, and disabled veteran
business utilization plan that is approved by the Department of
General Services, and that is subsequently awarded a contract to
which the vendor would not otherwise have been entitled, and who
fails to evidence intention to fully comply with the minority, women,
and disabled veteran business enterprise goals in the utilization
plan, or fails to evidence sufficient business reasons for failing to
achieve the minority, women, and disabled veteran business
enterprise goals set forth in the utilization plan, shall:
(A) Pay to the state any difference between the contract amount
and what the state's cost would have been if the contract had been
properly awarded.
(B) In addition to the amount specified in subparagraph (A), be
assessed a penalty in an amount of not more than 10 percent of the
amount of the contract involved.
(C) Be ineligible to transact any business with the state for a
period of not less than three months and not more than 24 months.
Prior to imposition of any sanction under this chapter, the
contractor or vendor shall be entitled to a public hearing and to
five days' notice of the time and place thereof. The notice shall
state the reasons for the hearing.
(d) The Department of General Services shall not approve a vendor'
s utilization plan unless the vendor agrees to provide the department
with any information the department deems necessary to meet the
reporting requirements set forth in subdivision (h) of Section 10111.
