Bill Text: CA AB366 | 2013-2014 | Regular Session | Amended

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

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Bill Title: Women, minority, and disabled veteran business enterprises.

Sponsorship: Partisan Bill (Democrat 1)

Status: (Introduced - Dead) 2014-02-03 - From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. [AB366 Detail]

Download: California-2013-AB366-Amended.html

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BILL NUMBER: AB 366	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 1, 2013
	AMENDED IN ASSEMBLY  APRIL 16, 2013
	AMENDED IN ASSEMBLY  APRIL 1, 2013

INTRODUCED BY   Assembly Member Holden

                        FEBRUARY 14, 2013

   An act to  amend Section 8282 of   add and
repeal S   ections 8282.1 and 8282.2 of  the Public
Utilities Code, relating to women, minority, and disabled veteran
business enterprises.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 366, as amended, Holden. Women, minority, and disabled veteran
business enterprises. 
    Under 
    (1)     Under  existing law, the
Public Utilities Commission has regulatory authority over public
utilities, including electrical, gas, water, and telephone
corporations. Existing law authorizes the commission to establish
rules for all public utilities, subject to control by the
Legislature.
   Existing law directs the commission to require every electrical,
gas, water, wireless telecommunications service provider, and
telephone corporation with annual gross revenues exceeding
$25,000,000, and their regulated subsidiaries and affiliates, to
implement a program developed by the commission to encourage,
recruit, and utilize minority-, women-, and disabled veteran-owned
business enterprises, as defined, in the procurement of contracts
from those corporations or from their regulated subsidiaries and
affiliates, and to require the reporting of certain information.
Existing law requires the commission, by rule or order, to adopt
criteria for verifying and determining eligibility of women,
minority, and disabled veteran business enterprises for procurement
contracts. The commission, by its rulemaking authority, has adopted
General Order 156, applicable to certain electrical, gas, and
telephone corporations, to effectuate these requirements. For the
purposes of these provisions, existing law defines a minority
business enterprise, women business enterprise, and disabled veteran
business enterprise. 
   This bill would revise and recast these definitions. 

   This bill would, until January 1, 2019, additionally authorize a
publicly owned business enterprise that provides financial or legal
services to qualify as a women, minority, or disabled veteran
business enterprise if it meets separate specified definitions for a
women, minority, or disabled veteran business enterprise,
respectively. This bill would, until January 1, 2020, require the
commission to require every electrical, gas, water, wireless
telecommunications service provider, and telephone corporation with
gross annual revenues exceeding $25,000,000 and their
commission-regulated subsidiaries and affiliates to separately
identify procurement contracts entered into with women, minority, and
disabled veteran business enterprises, as defined in these
provisions, in their annual plans. This bill would, until January 1,
2020, require the commission to separately identify procurement
contracts entered into pursuant to these provisions in a specified
annual report to the Legislature. This bill would provide that these
provisions do not provide authority for the creation of any corporate
structure not authorized under existing law.  
   (2) Under existing law, a violation of any provision of the Public
Utilities Act or any rules or orders of the commission is a crime.
In addition, any person or corporation that falsely represents a
business as a woman, minority, or disabled veteran business
enterprise for the purposes of the programs discussed above is
subject to criminal penalties.  
   Because a violation of the requirements of the bill would be a
crime under those provisions, this bill would 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:  no
  yes  . State-mandated local program:  no
  yes  .


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

   SECTION 1.    The Legislature finds and declares all
of the following:  
   (a) In 1986, the Public Utilities Commission adopted General Order
156 to promote competition among utility suppliers and to encourage
greater economic opportunity for women, minority, and disabled
veteran-owned businesses.  
   (b) General Order 156 states that "each utility shall make special
efforts to increase utilization and encourage entry into the
marketplace of women, minority, and disabled veteran-owned businesses
in product or service categories where there has been low
utilization such as legal and financial services, fuel procurement
and areas that are considered technical in nature."  
   (c) From 2010 to 2011, inclusive, utility procurement from women,
minority, and disabled veteran business enterprises increased from
$5.17 billion to $7.20 billion. However, the percentage of total
procurement from women, minority, and disabled veteran business
enterprises that provide financial or legal services continues to lag
behind procurement from other types of women, minority, and disabled
veteran business enterprises.  
   (d) Women represent more than 50 percent of our population, and
minorities together make up more than 35 percent of our population
combined. Out of a total United States population of 308 million,
African Americans number more than 37 million, Asian Pacific
Americans number more than 13 million, and Hispanic Americans number
more than 45 million. Yet, those numbers are hardly reflected in the
leadership of our nation's top corporations.  
   (e) Only one out of every five board members is a woman; only one
out of every seven board members is a minority; only one out of every
28 board members is a minority woman; only one out of every 11 board
members is African American; only one out of every 48 board members
is Asian Pacific American; and only one out of every 28 board members
is Hispanic American.  
   (f) Minorities have less representation in executive management
than they do on corporate boards, representing 10.44 percent of
executive managers, compared to the 35 percent of their actual
proportion in the United States population. Only one out of every
five executive managers is a woman; only one out of every nine
executive managers is minority; only one out of every 24 executive
managers is African American; only one out of every 30 executive
managers is Hispanic American; and only one out of every 35 executive
managers is Asian Pacific American.  
   (g) It is the intent of the Legislature to promote corporate
diversity consistent with the original intent of the supplier
diversity program and to continue these efforts in the procurement of
legal services and financial services from women, minority, and
disabled veteran business enterprises. 
   SEC. 2.    Section 8282.1 is added to the  
Public Utilities Code   , to read:  
   8282.1.  (a) The Legislature finds and declares all of the
following:
   (1) Shareowners elect the directors of a corporation pursuant to
Section 301 of the Corporations Code.
   (2) Under Section 309 of the Corporations Code, a director of a
corporation is required to perform the duties of a director in good
faith and in a manner that the director believes to be in the best
interests of the corporation and its shareowners, and with the care
of an ordinarily prudent person.
   (b) For the purposes of this section, "executive management team"
means controlling officers, as defined in the articles of
incorporation or bylaws of the publicly owned business.
   (c) In addition to Section 8282, a publicly owned business
enterprise that provides financial or legal services may also qualify
as a women, minority, or disabled veteran business enterprise if it
meets any of the following definitions:
   (1) "Women business enterprise" means a business enterprise that
has a board of directors that consists of at least 51 percent women
and has an executive management team that consists of at least 51
percent women. The membership of the board of directors must consist
of at least 51 percent women for at least five years prior to the
certification of a publicly owned business as a women business
enterprise.
   (2) "Minority business enterprise" means a business enterprise
that has a board of directors that consists of at least 51 percent
minority individuals and has an executive management team that
consists of at least 51 percent minority individuals. The membership
of the board of directors shall consist of at least 51 percent
minority individuals for at least five years prior to the
certification of a publicly owned business as a minority business
enterprise. The contracting utility shall presume that minority
includes Asian Pacific Americans, African Americans, Hispanic
Americans, and Native Americans.
   (3) "Disabled veteran business enterprise" means a business
enterprise that has a board of directors that consists of at least 51
percent disabled veterans and has an executive management team that
consists of at least 51 percent disabled veterans. The membership of
the board of directors must consist of at least 51 percent disabled
veterans for at least five years prior to the certification of a
publicly owned business as a disabled veteran business enterprise.
   (d) The commission shall establish guidelines for calculating how
the requirement that the board of directors and executive management
team consist of at least 51 percent women, minority individuals, or
disabled veterans can be met, including how to calculate the
percentage when an individual fits within two or more of the
categories described in the definitions in subdivision (c) or when
the board of directors or executive management team consists of a
combination of women, minority individuals, or disabled veterans.
   (e) This section shall become inoperative on January 1, 2019, and,
as of January 1, 2020, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2020, deletes or
extends the dates on which it becomes inoperative and is repealed.

   SEC. 3.    Section 8282.2 is added to the  
Public Utilities Code  , to read:  
   8282.2.  (a) The commission shall require every electrical, gas,
water, wireless telecommunications service provider, and telephone
corporation with gross annual revenues exceeding twenty-five million
dollars ($25,000,000) and their commission-regulated subsidiaries and
affiliates to separately identify procurement contracts entered into
with women, minority, and disabled veteran business enterprises, as
defined in Section 8282.1, in their annual plans required by
subdivision (a) of Section 8283.
   (b) The commission shall separately identify procurement contracts
entered into pursuant to Section 8282.1 in its annual report
required by subdivision (e) of Section 8283.
   (c) This section shall remain in effect only until January 1,
2020, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2020, deletes or extends
that date. 
   SEC. 4.    Subdivision (c) of Section 8282.1 of the
Public Utilities Code does not provide authority for the creation of
any corporate structure not authorized under existing law  
. 
   SEC. 5.    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.  
  SECTION 1.    Section 8282 of the Public Utilities
Code is amended to read:
   8282.  For purposes of this article, the following definitions
apply:
   (a) "Women business enterprise" means a business enterprise whose
management and daily business operations are controlled by one or
more women and is either at least 51 percent owned by a woman or
women; or, in the case of any publicly owned business, has an
executive management team that consists of at least 51 percent women,
and has a board of directors whose membership includes at least 51
percent women, and did so for at least five years prior to the
certification of the publicly owned business as a women business
enterprise.
   (b) "Minority business enterprise" means a business enterprise
whose management and daily business operations are controlled by one
or more members of a minority group and is either at least 51 percent
owned by a minority group or groups; or, in the case of any publicly
owned business, has an executive management team that consists of at
least 51 percent minority, and has a board of directors whose
membership includes at least 51 percent of one or more minority
groups and did so for at least five years prior to the certification
of the publicly owned business as a minority business enterprise. The
contracting utility shall presume that minority includes Asian
Pacific Americans, African Americans, Hispanic Americans, and Native
Americans.
   (c) "Disabled veteran business enterprise" has the same meaning as
defined in paragraph (7) of subdivision (b) of Section 999 of the
Military and Veterans Code, except that in the case of any publicly
owned business the board of directors membership shall include at
least 51 percent disabled veterans, and the executive management and
daily business operations shall be controlled by one or more disabled
veterans. The membership of the board of directors must consist of
at least 51 percent disabled veterans for at least five years prior
to the certification of a publicly owned business as a disabled
veteran business enterprise.
   (d) "Control" means exercising the power to make policy decisions.

   (e)  "Operate" means being actively involved in the day-to-day
management and not merely officers or directors.
   (f) "Executive management team" means controlling officers, as
defined in the articles of incorporation or bylaws of the publicly
owned businesses.