Bill Text: CA AB450 | 2011-2012 | Regular Session | Amended

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

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Bill Title: California State University: food service contracts.

Spectrum: Partisan Bill (Democrat 8-0)

Status: (Vetoed) 2011-10-08 - Vetoed by Governor. [AB450 Detail]

Download: California-2011-AB450-Amended.html

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BILL NUMBER: AB 450	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JUNE 28, 2011
	AMENDED IN ASSEMBLY  MAY 2, 2011

INTRODUCED BY   Assembly Member Wieckowski
    (   Coauthors:   Assembly Members 
 Fuentes,  Gatto,   Mendoza,   and
Portantino   ) 
    (   Coauthor:   Senator   Vargas
  ) 

                        FEBRUARY 15, 2011

   An act to amend Section 89036 of the Education Code,   and
to amend Section 12440.1 of the Government Code,   relating
to the California State University.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 450, as amended, Wieckowski. California State University:
audits. 
   (1) Existing law requires the Trustees of the California State
University to maintain records of certain vendor payments for 3 years
and make those records available to the Controller for postaudit
review, as needed, and to contract with one or more public accounting
firms to conduct specified financial statement and compliance audits
without obtaining the approval of any other state officer or entity.
 
   This bill would provide that the trustees, in conjunction with the
Controller, have the right, at reasonable times and upon reasonable
notice, to examine the books, records, and other compilations of data
of a services contractor, as defined, that relate to the provisions
and requirements of all service contracts.  
   (2) 
    Existing  law authorizes the  trustees 
 Trustees of the California State University  to enter into
agreements for the performance of acts or for the furnishing of
services, facilities, materials, goods, supplies, or equipment, under
certain conditions. The trustees are required to prescribe policies
and procedures for the acquisition of services, facilities,
materials, goods, supplies, or equipment, subject to specified
criteria.
   This bill would require the policies and procedures for the
acquisition of services to  specify that any direct or
indirect rebates from a 3rd party be fully disclosed  
ensure a service contractor, as defined, fully discloses to the
campus, auxiliary organization, or other unit of the California State
University all discounts, rebates, allowances, and incentives
received by the service contractor from its suppliers, as specified,
 and  credited   to disclose and pay 
to the campus  , auxiliary organization,  or other unit of
the university  the full amount of the discount, rebate, or
applicable credit, as specified. This bill would require the policies
and procedures for the acquisition of services   and
 be available for review as part of any audit conducted
under specified provisions.  The bill would require any necessary
changes to the policies and procedures for the acquisition of
services be implemented upon the renewal, extension, or amendment of
an existing agreement or as part of any new service agreement. 

   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 89036 of the Education Code is amended to read:

   89036.  (a) (1) The trustees may enter into agreements with any
public or private agency, officer, person, or institution,
corporation, association, or foundation for the performance of acts
or for the furnishing of services, facilities, materials, goods,
supplies, or equipment by or for the trustees or for the joint
performance of an act or function or the joint furnishing of services
and facilities by the trustees and the other party to the agreement.

   (2) (A) Notwithstanding any other provision of law, the trustees
shall prescribe policies and procedures for the acquisition of
services, facilities, materials, goods, supplies, or equipment. The
policies and procedures of the trustees for the acquisition of
materials, goods, supplies, or equipment shall include competitive
means for obtaining best value while complying with legislative
intent regarding competitive bids or proposals as it is expressed in
Article 3 (commencing with Section 10300) of Chapter 2 of Part 2 of
Division 2 of the Public Contract Code, and may include the use of
financing arrangements.
   (B) The policies and procedures for the acquisition of services
 shall specify that any direct or indirect rebates from a
third party shall be fully disclosed and credited to the campus or
other unit of the university   shall ensure that a
service contractor fully discloses to the California State University
campus, auxiliary organization, or other unit of the  
California State University all discounts, rebates, allowances, and
incentives received by the service contractor from its suppliers. If
the service contractor receives a discount, rebate, allowance, or
other incentive from any supplier, the service contractor shall
disclose and pay to the California State University campus the full
amount of the discount, rebate, or applicable credit that is received
based on the purchases made on behalf of the California State
University campus, auxiliary organization, or other unit of the
California State University. Language stating this requirement shall
be placed in agreements covered by this section. All discounts,
rebates, allowances, and incentives shall be paid to the California
State University campus, auxiliary organization, or other unit of the
California State University during a mutually agreed upon time frame
 , and be available for review as part of any audit conducted
pursuant to Section 89045 or  Section  12440.1 of
the Government Code.  Any changes required pursuant to this
section shall be implemented upon the renewal, extension, or amendmen
  t of an existing agreement or as part of any new service
agreement. 
   (3) The trustees may enter into agreements with the federal
government or any agency thereof in accordance with the procedures
prescribed by the federal government or agency in order to receive
the benefits of any federal statute extending benefits to the
California State University or to California State University
students, including, but not necessarily limited to, both of the
following:
   (A) Agreements with any agency of the federal government for the
education of persons in the service of the federal government.
   (B) Agreements with any agency of the federal government for the
education of veterans. These agreements shall provide for payment of
the maximum amount permitted under the act, or acts, of Congress
under which the agreement is entered into.
   (4) Notwithstanding any other provision of law, the trustees have
all power necessary to perform any acts, and comply with conditions,
required or imposed by the federal government in order to receive the
benefits. The trustees are vested with all necessary power and
authority to cooperate with any agency of the federal government in
the administration of any applicable act of Congress and rules and
regulations adopted thereunder.
   (b) Notwithstanding any other provision of law, the trustees have
all power necessary to award contracts to one or more contractors, at
any one or more campuses, for the collection of delinquent 
education   educational  loans required to be
repaid under federal law. 
   (c) As used in this section, the following terms have the
following meanings:  
   (1) "Auxiliary organization" means those entities defined in
Section 89901.  
   (2) "Rebate" includes any return of monetary value, including, but
not limited to, any volume discounts, allowances, or discount
purchase incentives.  
   (3) "Service contractor" includes a contractor providing food,
janitorial, laundry, maintenance, window cleaning, or landscape
services.  
  SEC. 2.    Section 12440.1 of the Government Code
is amended to read:
   12440.1.  (a) The trustees, in conjunction with the Controller,
shall implement a process that allows any campus or other unit of the
university to make payments of obligations of the university from
its revolving fund directly to all of its vendors. Notwithstanding
Article 5 (commencing with Section 16400) of Chapter 2 of Part 2 of
Division 4, or any other provision of law, the trustees may draw from
funds appropriated to the university, for use as a revolving fund,
amounts necessary to make payments of obligations of the university
directly to vendors. In any fiscal year, the trustees shall obtain
the approval of the Director of Finance to draw amounts in excess of
10 percent of the total appropriation to the university for that
fiscal year for use as a revolving fund.
   (b) The trustees, in conjunction with the Controller, shall have
the right at reasonable times and upon reasonable notice to examine
the books, records, and other compilations of data of the services
contractor that relate to the provisions and requirements of all
service contracts, including records related to any rebates received
by a contractor from a third party as a consequence of, or incidental
to, a contract.
   (c) Notwithstanding Sections 925.6, 12410, and 16403, or any other
provision of law, the trustees shall maintain payment records for
three years and make those records available to the Controller for
postaudit review, as needed.
   (d) Notwithstanding Section 8546.4 or any other provision of law,
the trustees shall, pursuant to an open bidding process, contract
with one or more public accounting firms to conduct systemwide and
individual campus annual financial statement and compliance audits
without obtaining the approval of any other state officer or entity.
At least 10 individual campus audits shall be conducted on a rotating
basis, and each campus shall be audited at least once every two
years.
   (e) The internal and independent financial statement audits of the
trustees shall test compliance with procurement procedures and the
integrity of the payments made. The results of these audits shall be
included in the biennial report required by Section 13405.
   (f) As used in this section, the following terms have the
following meanings:
   (1) "Rebate" includes any return of monetary value, including, but
not limited to, any volume discounts, allowances, or discount
purchase incentives.
   (2) "Services contractor" includes a contractor providing food,
janitorial, laundry, maintenance, window cleaning, or landscape
services.
   (3) "Trustees" means the Trustees of the California State
University.
   (4) "University" means the California State University.