Bill Text: CA AB2508 | 2011-2012 | Regular Session | Amended

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

---

Bill Title: Public contracts: public health agencies.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Passed) 2012-09-30 - Chaptered by Secretary of State - Chapter 824, Statutes of 2012. [AB2508 Detail]

Download: California-2011-AB2508-Amended.html

---

BILL NUMBER: AB 2508	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 25, 2012
	AMENDED IN ASSEMBLY  MAY 2, 2012
	AMENDED IN ASSEMBLY  APRIL 19, 2012
	AMENDED IN ASSEMBLY  MARCH 29, 2012

INTRODUCED BY   Assembly Member Bonilla
   (Coauthor: Assembly Member Beall)

                        FEBRUARY 24, 2012

   An act  to amend Section 10111 of, and  to add
Chapter 3.7 (commencing with Section 12140) to Part 2 of Division 2
 of,   of  the Public Contract Code,
relating to public contracts.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2508, as amended, Bonilla. Public contracts: public health
agencies.
   Existing law requires a state agency to comply with specified
procedures in awarding agency contracts.
   This bill would  , with specified exceptions,  also
prohibit a state agency authorized to contract for public benefit
programs from contracting for call center services with a contractor
or subcontractor unless that contractor or subcontractor certifies
under penalty of perjury in his or her bid for the contract that the
contract, and any subcontract performed under that contract, will be
performed solely with workers employed in California. This bill would
 authorize these agencies to waive this requirement, with
the consent of the Controller, if certain conditions are met, and
would require the Department of General Services to include specified
information relating to these waivers in an annual report, as
provided   specify that the Governor may waive these
requirements during a declared emergency  . This bill would also
require the contract to include a clause for termination for
noncompliance and specified penalties, if the contractor or
subcontractor performs the contract or the subcontract with workers
outside of California during the life of the contract.  This
bill would also specify that these provisions do not apply to an
existing contract, as provided, or to a contract if the refusal to
award that contract would violate the specific terms of federal trade
treaties or bilateral or regional free trade agreements, as
specified. 
   By requiring contractors and subcontractors to make certifications
under penalty of perjury, this bill would create a new crime and
thereby impose a state-mandated local program.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


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

  SECTION 1.  The Legislature finds and declares the following:
   (a) The federal and state economies are recovering from the great
recession and California still has a high unemployment rate. Millions
of Californians are not working or  are  working less than
they want and need full-time employment. California continues to
allow state public benefit call center contracts to be awarded to
contractors that perform the work outside the United States.
   (b) By contracting and subcontracting outside of the country, jobs
are displaced in the United States and in California, and taxpayer
dollars are used to create jobs in foreign countries. State tax
revenues should be used to create jobs in the United States and in
California, especially when the taxpayer dollars are designated for
programs meant to create jobs and address problems associated with
joblessness. 
  SEC. 2.    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 any 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 statues 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 owner, in contracts as identified in Section
2051 of the Government Code, 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 owner, 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) Beginning in the year 2013, a list of in-state worker waivers
requested by state agencies pursuant to subdivision (d) of Section
12140, including an indication as to whether the Controller rejected
the waiver request. 
   SEC. 3.   SEC. 2.   Chapter 3.7
(commencing with Section 12140) is added to Part 2 of Division 2 of
the Public Contract Code, to read:
      CHAPTER 3.7.  PROHIBITION OF THE OFFSHORING OF STATE PUBLIC
BENEFITS CONTRACTS


   12140.  (a) Notwithstanding any other law, any state agency
authorized to enter into contracts for public  benefits
  benefit  programs shall not contract for call
center services for those public benefit programs with a contractor
unless that contractor certifies under penalty of perjury in his or
her bid for the contract that the contract, or any part thereof, and
any subcontract performed under that contract, will be performed
solely with workers employed in California.
   (b) For purposes of this section:
   (1) "Call center" means a building, facility, or operation where
customer or client services or assistance is provided by telephone,
fax, email, text, or Web-based interaction.
   (2) "Public benefit programs" means California Work Opportunity
and Responsibility to Kids (CalWORKs), CalFresh, Medi-Cal, Healthy
Families, and the California Healthcare Eligibility, Enrollment, and
Retention System.
   (c) The contract shall provide that in the event a contractor or
subcontractor performs the contract or the subcontract for call
center services with workers outside of California during the life of
the contract, the contract shall be terminated for noncompliance and
the contractor or subcontractor shall pay a penalty to the state
agency in an amount equal to the amount paid by the state agency for
the percentage of work that was performed with workers outside of
California. 
   (d) (1) In the case of an emergency, a state agency may waive the
requirements of subdivision (a) for a particular contract prior to
the notice inviting bids if that state agency submits a written
finding relative to the nature of the emergency and facts related to
the contract meeting the requirements of subparagraphs (A), (B), and
(C) to the Controller, and the Controller does not reject that
finding within 30 days of receipt. The term of the waiver shall be
for no longer than six months. The finding shall detail how the
contract is necessary to respond to an emergency, as determined by
the state agency, and that all of the following are true: 

   (A) The ability of the state agency to provide essential services
would be adversely affected if the contract is not performed.
 
   (B) The public health, safety, and welfare would be endangered if
the contract is not performed.  
   (C) A contractor or subcontractor that has the ability to perform
the contract solely with workers within California is not immediately
available to perform the contract.  
   (2) In the case of an emergency, a state agency may waive the
requirements of subdivision (a) for a particular contract already in
force, for a period not to exceed one year per waiver, if that state
agency submits a written finding relative to the nature of the
emergency and facts related to the contract meeting the requirements
of subparagraphs (A), (B), and (C) to the Controller, and the
Controller does not reject that finding within 30 days of receipt.
The finding shall detail how the contract is necessary to respond to
an emergency and that all of the following are true: 

   (A) The ability of the state agency to provide essential services
would be adversely affected if the contract is not performed.
 
   (B) The public health, safety, and welfare would be endangered if
the contract is not performed.  
   (C) A contractor or subcontractor that has the ability to perform
the contract solely with workers within California is not immediately
available to perform the contract.  
   (3) If a state agency seeks a waiver pursuant to paragraph (1) or
(2), the waiver shall include the facts the agency used to make the
findings in paragraph (1) or (2), including, but not limited to, the
estimated number of jobs affected and the estimated duration of
employment, and salaries of the noncompliant workers. Every contract
subject to the provisions of this section shall include information
on the conditions and the procedural requirements for making a waiver
request to the contracting state agency. The contract shall also
include the penalties conferred upon the contractor pursuant to
subdivision (c) and paragraph (5) for using out-of-state workers to
perform the state contract.  
   (4) (A) A state agency that seeks a waiver under paragraph (1) or
(2) shall, at the same time that the entity provides the written
finding to the Controller, post a copy of the written finding on the
agency's Internet Web site and provide written notice to the Assembly
Committee on Business, Professions, and Consumer Protection, the
Assembly Committee on Jobs, Economic Development, and the Economy,
the Assembly Committee on Budget, the Senate Committee on
Governmental Organization, and the Senate Committee on Budget and
Fiscal Review.  
   (B) The Controller shall annually provide the Department of
General Services with a list of waivers requested by state agencies
pursuant to paragraph (1) or (2) with an indication of whether the
Controller rejected the waiver. The Department of General Services
shall include this information in the annual report required in
Section 10111 of the Public Contract Code.  
   (5) If the Controller rejects a written finding while the contract
is being performed or after the contract has been performed, the
contractor or subcontractor shall pay a penalty to the state agency
in an amount equal to the amount paid by the state agency for the
percentage of work that was performed with workers outside of
California.  
   (d) The requirements of subdivision (a) shall not apply if the
Governor waives those requirements pursuant to Section 8571 of the
Government Code. 
   (e) This section shall not apply to  a   the
following: 
    (1)     A  contract if the refusal to
award that contract, on the basis that the contractor or
subcontractor does not certify under penalty of perjury that the
contract and any subcontract performed under that contract will be
performed solely with workers within California, would violate the
specific terms of the Agreement on Government Procurement of the
World Trade Organization or any other bilateral or regional free
trade agreement  that   to which the State of
 California has consented  to  . 
   (f) This section shall not apply to a 
    (2)     A  contract or subcontract,
currently in place, if it would result in a violation of the terms of
the contract, but upon expiration of that contract, these provisions
shall be added before a new contract can be executed or renewed.

   (3) A contract for a public benefit program between a state agency
and a health care service plan or a specialized health care service
plan regulated by the Department of Managed Health Care, and any
subcontract performed under that contract, or a disability insurer or
specialized health insurer regulated by the Department of Insurance,
and any subcontract performed under that contract. 
   SEC. 4.   SEC. 3.   No reimbursement is
required by this act pursuant to Section 6 of Article XIII B of the
California Constitution because the only costs that may be incurred
by a local agency or school district will be incurred because this
act creates a new crime or infraction, eliminates a crime or
infraction, or changes the penalty for a crime or infraction, within
the meaning of Section 17556 of the Government Code, or changes the
definition of a crime within the meaning of Section 6 of Article XIII
B of the California Constitution.