AB 1424: University of California: Best Value Construction Contracting Program.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2017-10-15
Existing law creates a Best Value Construction Contracting Pilot Program for the Regents of the University of California to award construction contracts based on the best value procedures, as specified. Existing law requires the regents to adopt and publish procedures and required criteria, as specified, that ensure that all selections are conducted in a fair and impartial manner. Existing law requires bidders to verify specified information under oath. Existing law repeals these provisions on January 1, 2018.
This bill, with certain exceptions, would prohibit a best value contractor from being prequalified or shortlisted unless the best value contractor provides an enforceable commitment to the regents that the best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with specified skilled and trained workforce requirements. The bill would require a contractor, bidder, or other entity that commits to using a skilled and trained workforce to complete a contract or project also to provide a monthly report demonstrating compliance with these provisions. The bill would eliminate the repeal date for the pilot program, and by doing so, would extend the requirement that bidders verify specified information under oath, and impose a state-mandated local program by expanding the scope of an existing crime.
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.
Existing law creates a Best Value Construction Contracting Pilot Program for the Regents of the University of California to award construction contracts based on the best value procedures, as specified. Existing law requires the regents to adopt and publish procedures and required criteria, as specified, that ensure that all selections are conducted in a fair and impartial manner. Existing law requires bidders to verify specified information under oath. Existing law repeals these provisions on January 1, 2018.
This bill, with certain exceptions, would prohibit a best value contractor from being prequalified or shortlisted unless the best value contractor provides an enforceable commitment to the regents that the best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with specified skilled and trained workforce requirements. The bill would require a contractor, bidder, or other entity that commits to using a skilled and trained workforce to complete a contract or project also to provide a monthly report demonstrating compliance with these provisions. The bill would eliminate the repeal date for the pilot program, and by doing so, would extend the requirement that bidders verify specified information under oath, and impose a state-mandated local program by expanding the scope of an existing crime.
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.
Existing law creates a Best Value Construction Contracting Pilot Program for the Regents of the University of California to award construction contracts based on the best value procedures, as specified. Existing law requires the regents to adopt and publish procedures and required criteria, as specified, that ensure that all selections are conducted in a fair and impartial manner. Existing law requires bidders to verify specified information under oath. Existing law repeals these provisions on January 1, 2018.
This bill, with certain exceptions, would prohibit a best value contractor from being prequalified or shortlisted unless the best value contractor provides an enforceable commitment to the regents that the best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with specified skilled and trained workforce requirements. The bill would require a contractor, bidder, or other entity that commits to using a skilled and trained workforce to complete a contract or project also to provide a monthly report demonstrating compliance with these provisions. The bill would eliminate the repeal date for the pilot program, and by doing so, would extend the requirement that bidders verify specified information under oath, and impose a state-mandated local program by expanding the scope of an existing crime.
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.
Existing law creates a Best Value Construction Contracting Pilot Program for the Regents of the University of California to award construction contracts based on the best value procedures, as specified. Existing law requires the Regents of the University of California regents to adopt and publish procedures and required criteria, as specified, that ensure that all selections are conducted in a fair and impartial manner. Existing law requires bidders to verify specified information under oath. Existing law repeals these provisions on January 1, 2018.
This bill, with certain exceptions, would prohibit a best value entity contractor from being prequalified or shortlisted unless that entity the best value contractor provides an enforceable commitment to the regents that the entity best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with existing specified skilled and trained workforce requirements. The bill would require a contractor, bidder, or other entity that commits to using a skilled and trained workforce to complete a contract or project also to provide a monthly report demonstrating compliance with these provisions. The bill would eliminate the repeal date for the pilot program, and by doing so, would extend the requirement that bidders verify specified information under oath, and impose a state-mandated local program by expanding the scope of an existing crime.
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.
Existing law creates a Best Value Construction Contracting Pilot Program for the Regents of the University of California to award construction contracts based on the best value procedures, as specified. Existing law requires the Regents of the University of California to adopt and publish procedures and required criteria, as specified, that ensure that all selections are conducted in a fair and impartial manner. Existing law requires bidders to verify specified information under oath. Existing law repeals these provisions on January 1, 2018.
This bill bill, with certain exceptions, would prohibit a best value entity from being prequalified or shortlisted unless that entity provides an enforceable commitment to the regents that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with existing skilled and trained workforce requirements. The bill would eliminate the repeal date, date for the pilot program, and by doing so, would extend the requirement that bidders verify specified information under oath, and impose a state-mandated local program by expanding the scope of an existing crime.
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.
Existing law creates a Best Value Construction Contracting Pilot Program for the Regents of the University of California to award construction contracts based on the best value procedures, as specified. Existing law requires the Regents of the University of California to adopt and publish procedures and required criteria, as specified, that ensure that all selections are conducted in a fair and impartial manner. Existing law requires bidders to verify specified information under oath. Existing law repeals these provisions on January 1, 2018.
This bill would eliminate the repeal date, and by doing so, would extend the requirement that bidders verify specified information under oath, and impose a state-mandated local program by expanding the scope of an existing crime.
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.
(a)This article provides the Best Value Construction Contracting Program for the Regents of the University of California for projects over one million dollars ($1,000,000).
(b)The Regents of the University of California shall let any contract for a project pursuant to this article to the lowest responsible bidder or else reject all bids.
(c)The lowest responsible bidder may be selected on the basis of the best value to the university, as defined in Section 10506.5. In order to implement this method of selection, the Regents of the University of California shall adopt and publish procedures and required guidelines for evaluating the qualifications of the bidders that ensure that best value selections by the university are conducted in a fair and impartial manner. These procedures and guidelines shall conform to the requirements of Sections 10506.6 and 10506.7 and shall be mandatory for the university when using best value selection.
(d)If one or more of the bids is substantially equal to the lowest bid, and at least one of those bidders is a disadvantaged business enterprise, a women business enterprise, or a disabled veteran business enterprise, the Regents of the University of California may award the contract in accordance with the policies and procedures adopted pursuant to Section 10500.5.
(e)If the Regents of the University of California deem it to be for the best interest of the university, the regents may, on the refusal or failure of the successful bidder for a project to execute a tendered contract, award it to the second lowest responsible bidder. If the second lowest responsible bidder fails or refuses to execute the contract, the regents may likewise award it to the third lowest responsible bidder.
SEC. 3.Section 10506.5 of the Public Contract Code is amended to read:10506.5.For purposes of this article, the following definitions apply:
(a)Best value means a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria for evaluating the qualifications of bidders with the resulting selection representing the best combination of price and qualifications.
(b)Best value contract means a contract entered into pursuant to the provisions of this article.
(c)Best value contractor means a properly licensed person, firm, or corporation that submits a bid for, or is awarded, a best value contract.
(d)Demonstrated management competency means the experience, competency, capability, and capacity of the proposed management staffing to complete projects of similar size, scope, or complexity.
(e)Financial condition means the financial resources needed to perform the contract. The criteria used to evaluate a bidders financial condition shall include, at a minimum, capacity to obtain all required payment bonds, performance bonds, and liability insurance.
(f)Labor compliance means the ability to comply with, and past performance with, contract and statutory requirements for the payment of wages and qualifications of the workforce. The criteria used to evaluate a bidders labor compliance shall include, as a minimum, the bidders ability to comply with the apprenticeship requirements of the California Apprenticeship Council and the Department of Industrial Relations, its past conformance with such requirements, and its past conformance with requirements to pay prevailing wages on public works projects.
(g)Project labor agreement means a prehire collective bargaining agreement that establishes terms and conditions of employment for a specific construction project or projects and is an agreement described in Section 158(f) of Title 29 of the United States Code.
(h)Qualifications means financial condition, relevant experience, demonstrated management competency, labor compliance, the safety record of the bidder, and, if required by the bidding documents, some or all of the preceding qualifications as they pertain to subcontractors proposed to be used by the bidder for designated portions of the work.
(i)Relevant experience means the experience, competency, capability, and capacity to complete projects of similar size, scope, or complexity.
(j)Safety record means the prior history concerning the safe performance of construction contracts. The criteria used to evaluate a bidders safety record shall include, as a minimum, its experience modification rate for the most recent three-year period, and its average total recordable injury or illness rate and average lost work rate for the most recent three-year period.
(k)University means all locations of the University of California.
SEC. 4.Section 10506.6 of the Public Contract Code is amended to read:10506.6.The university shall proceed in accordance with the following when awarding best value contracts under this article.
(a)The university shall prepare a solicitation for bids and give notice pursuant to Section 10502.
(b)The university shall establish a procedure to prequalify bidders. The information required pursuant to this section shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. Information submitted by the bidder as part of the evaluation process shall not be open to public inspection to the extent that information is exempt from disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(c)(1)A best value contractor shall not be prequalified or shortlisted unless the entity provides an enforceable commitment to the Regents of the University of California that the best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with Sections 10506.8 and 10506.9.
(2)This subdivision shall not apply if any of the following requirements are met:
(A)The Regents of the University of California have entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or contract to use a skilled and trained workforce, and the entity agrees to be bound by that project labor agreement.
(B)The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the Regents of the University of California prior to January 1, 2018.
(C)The best value contractor has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or contract to use a skilled and trained workforce.
(3)For purposes of this subdivision, project labor agreement has the same meaning as in subdivision (g) of Section 10506.5.
(d)Each solicitation for bids shall do all of the following:
(1)Invite prequalified bidders to submit sealed bids in the manner prescribed by this article.
(2)Include a section identifying and describing the following:
(A)Criteria that the university will consider in evaluating the qualifications of the bidders.
(B)The methodology and rating or weighting system that will be used by the university in evaluating bids.
(C)The relative importance or weight assigned to the criteria for evaluating the qualifications of bidders identified in the request for bids.
(e)Final evaluation of the best value contractor shall be done in a manner that prevents cost or price information from being revealed to the committee evaluating the qualifications of the bidders prior to completion and announcement of that committees decision.
SEC. 5.Section 10506.8 is added to the Public Contract Code, to read:10506.8.For purposes of this article:
(a)Apprenticeable occupation means an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program pursuant to Section 3075 of the Labor Code before January 1, 2014.
(b)Chief means the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
(c)Graduate of an apprenticeship program means either of the following:
(1)An individual who has been issued a certificate of completion under the authority of the California Apprenticeship Council for completing an apprenticeship program approved by the chief pursuant to Section 3075 of the Labor Code.
(2)An individual who has completed an apprenticeship program located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(d)Skilled and trained workforce means a workforce that meets all of the following requirements:
(1)All of the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the chief.
(2)(A)For work performed on or after January 1, 2017, at least 30 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the occupation of teamster.
(B)For work performed on or after January 1, 2018, at least 40 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(C)For work performed on or after January 1, 2019, at least 50 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(D)For work performed on or after January 1, 2020, at least 60 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(3)For an applicable occupation in which no apprenticeship program had been approved by the chief before January 1, 1995, up to one-half of the graduation percentage requirement of paragraph (2) may be satisfied by skilled journeypersons who commenced working in the apprenticeable occupation before the chiefs approval of an apprenticeship program for that occupation in the county in which the project is located.
(4)The apprenticeship graduation percentage requirements of paragraph (2) are satisfied if, in a calendar month, either of the following occurs:
(A)At least the required percentage of the skilled journeypersons employed by the contractor or subcontractor to perform work on the contract or project meet the graduation percentage requirements.
(B)For the hours of work performed by skilled journeypersons employed by the contractor or subcontractor on the contract or project, the percentage of hours performed by skilled journeypersons who meet the graduation requirement is at least equal to the required graduation percentage.
(5)The contractor or subcontractor need not meet the apprenticeship graduation requirements of paragraph (2) if, during the calendar month, the contractor or subcontractor employs skilled journeypersons to perform fewer than 10 hours of work on the contract or project.
(6)A subcontractor need not meet the apprenticeship requirements of paragraph (2) if both of the following requirements are met:
(A)The subcontractor was not a listed subcontractor under Section 4104 or a substitute for a listed subcontractor.
(B)The subcontract does not exceed one-half of 1 percent of the price of the prime contract.
(e)Skilled journeyperson means a worker who either:
(1)Graduated from an apprenticeship program for the applicable occupation that was approved by the chief or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(2)Has at least as many hours of on-the-job experience in the applicable occupation as would be required to graduate from an apprenticeship program for the applicable occupation that is approved by the chief.
SEC. 6.Section 10506.9 of the Public Contract Code is repealed.SEC. 7.Section 10506.9 is added to the Public Contract Code, to read:10506.9.(a)If a contractor, bidder, or other entity is required to provide an enforceable commitment that a skilled and trained workforce will be used to complete a contract or project, the commitment shall be made in an enforceable agreement with the university that provides both of the following:
(1)The contractor, bidder, or other entity, and its contractors and subcontractors at every tier, will comply with this article.
(2)The contractor, bidder, or other entity shall provide to the university, on a monthly basis while the project contract is being performed, a report demonstrating compliance with this article.
(b)If the contractor, bidder, or other entity fails to provide the monthly report required by this section, or provides a report that is incomplete, the university shall withhold further payments until a complete record is provided.
(c)If a monthly report does not demonstrate compliance with this article, the university shall withhold further payments until the contractor, bidder, or other entity provides a plan to achieve substantial compliance with this article, with respect to the relevant apprenticeable occupation, prior to completion of the contract or project.
(d)A monthly report provided to the university shall be a public record under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code) and shall be open to public inspection.
SEC. 8.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
(a)This article provides the Best Value Construction Contracting Program for the Regents of the University of California for projects over one million dollars ($1,000,000).
(b)The Regents of the University of California shall let any contract for a project pursuant to this article to the lowest responsible bidder or else reject all bids.
(c)The lowest responsible bidder may be selected on the basis of the best value to the university, as defined in Section 10506.5. In order to implement this method of selection, the Regents of the University of California shall adopt and publish procedures and required guidelines for evaluating the qualifications of the bidders that ensure that best value selections by the university are conducted in a fair and impartial manner. These procedures and guidelines shall conform to the requirements of Sections 10506.6 and 10506.7 and shall be mandatory for the university when using best value selection.
(d)If one or more of the bids is substantially equal to the lowest bid, and at least one of those bidders is a disadvantaged business enterprise, a women business enterprise, or a disabled veteran business enterprise, the Regents of the University of California may award the contract in accordance with the policies and procedures adopted pursuant to Section 10500.5.
(e)If the Regents of the University of California deem it to be for the best interest of the university, the regents may, on the refusal or failure of the successful bidder for a project to execute a tendered contract, award it to the second lowest responsible bidder. If the second lowest responsible bidder fails or refuses to execute the contract, the regents may likewise award it to the third lowest responsible bidder.
SEC. 3.Section 10506.5 of the Public Contract Code is amended to read:10506.5.For purposes of this article, the following definitions apply:
(a)Best value means a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria for evaluating the qualifications of bidders with the resulting selection representing the best combination of price and qualifications.
(b)Best value contract means a contract entered into pursuant to the provisions of this article.
(c)Best value contractor means a properly licensed person, firm, or corporation that submits a bid for, or is awarded, a best value contract.
(d)Demonstrated management competency means the experience, competency, capability, and capacity of the proposed management staffing to complete projects of similar size, scope, or complexity.
(e)Financial condition means the financial resources needed to perform the contract. The criteria used to evaluate a bidders financial condition shall include, at a minimum, capacity to obtain all required payment bonds, performance bonds, and liability insurance.
(f)Labor compliance means the ability to comply with, and past performance with, contract and statutory requirements for the payment of wages and qualifications of the workforce. The criteria used to evaluate a bidders labor compliance shall include, as a minimum, the bidders ability to comply with the apprenticeship requirements of the California Apprenticeship Council and the Department of Industrial Relations, its past conformance with such requirements, and its past conformance with requirements to pay prevailing wages on public works projects.
(g)Project labor agreement means a prehire collective bargaining agreement that establishes terms and conditions of employment for a specific construction project or projects and is an agreement described in Section 158(f) of Title 29 of the United States Code.
(h)Qualifications means financial condition, relevant experience, demonstrated management competency, labor compliance, the safety record of the bidder, and, if required by the bidding documents, some or all of the preceding qualifications as they pertain to subcontractors proposed to be used by the bidder for designated portions of the work.
(i)Relevant experience means the experience, competency, capability, and capacity to complete projects of similar size, scope, or complexity.
(j)Safety record means the prior history concerning the safe performance of construction contracts. The criteria used to evaluate a bidders safety record shall include, as a minimum, its experience modification rate for the most recent three-year period, and its average total recordable injury or illness rate and average lost work rate for the most recent three-year period.
(k)University means all locations of the University of California.
SEC. 4.Section 10506.6 of the Public Contract Code is amended to read:10506.6.The university shall proceed in accordance with the following when awarding best value contracts under this article.
(a)The university shall prepare a solicitation for bids and give notice pursuant to Section 10502.
(b)The university shall establish a procedure to prequalify bidders. The information required pursuant to this section shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. Information submitted by the bidder as part of the evaluation process shall not be open to public inspection to the extent that information is exempt from disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(c)(1)A best value contractor shall not be prequalified or shortlisted unless the entity provides an enforceable commitment to the Regents of the University of California that the best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with Sections 10506.8 and 10506.9.
(2)This subdivision shall not apply if any of the following requirements are met:
(A)The Regents of the University of California have entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or contract to use a skilled and trained workforce, and the entity agrees to be bound by that project labor agreement.
(B)The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the Regents of the University of California prior to January 1, 2018.
(C)The best value contractor has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or contract to use a skilled and trained workforce.
(3)For purposes of this subdivision, project labor agreement has the same meaning as in subdivision (g) of Section 10506.5.
(d)Each solicitation for bids shall do all of the following:
(1)Invite prequalified bidders to submit sealed bids in the manner prescribed by this article.
(2)Include a section identifying and describing the following:
(A)Criteria that the university will consider in evaluating the qualifications of the bidders.
(B)The methodology and rating or weighting system that will be used by the university in evaluating bids.
(C)The relative importance or weight assigned to the criteria for evaluating the qualifications of bidders identified in the request for bids.
(e)Final evaluation of the best value contractor shall be done in a manner that prevents cost or price information from being revealed to the committee evaluating the qualifications of the bidders prior to completion and announcement of that committees decision.
SEC. 5.Section 10506.8 is added to the Public Contract Code, to read:10506.8.For purposes of this article:
(a)Apprenticeable occupation means an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program pursuant to Section 3075 of the Labor Code before January 1, 2014.
(b)Chief means the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
(c)Graduate of an apprenticeship program means either of the following:
(1)An individual who has been issued a certificate of completion under the authority of the California Apprenticeship Council for completing an apprenticeship program approved by the chief pursuant to Section 3075 of the Labor Code.
(2)An individual who has completed an apprenticeship program located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(d)Skilled and trained workforce means a workforce that meets all of the following requirements:
(1)All of the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the chief.
(2)(A)For work performed on or after January 1, 2017, at least 30 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the occupation of teamster.
(B)For work performed on or after January 1, 2018, at least 40 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(C)For work performed on or after January 1, 2019, at least 50 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(D)For work performed on or after January 1, 2020, at least 60 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(3)For an applicable occupation in which no apprenticeship program had been approved by the chief before January 1, 1995, up to one-half of the graduation percentage requirement of paragraph (2) may be satisfied by skilled journeypersons who commenced working in the apprenticeable occupation before the chiefs approval of an apprenticeship program for that occupation in the county in which the project is located.
(4)The apprenticeship graduation percentage requirements of paragraph (2) are satisfied if, in a calendar month, either of the following occurs:
(A)At least the required percentage of the skilled journeypersons employed by the contractor or subcontractor to perform work on the contract or project meet the graduation percentage requirements.
(B)For the hours of work performed by skilled journeypersons employed by the contractor or subcontractor on the contract or project, the percentage of hours performed by skilled journeypersons who meet the graduation requirement is at least equal to the required graduation percentage.
(5)The contractor or subcontractor need not meet the apprenticeship graduation requirements of paragraph (2) if, during the calendar month, the contractor or subcontractor employs skilled journeypersons to perform fewer than 10 hours of work on the contract or project.
(6)A subcontractor need not meet the apprenticeship requirements of paragraph (2) if both of the following requirements are met:
(A)The subcontractor was not a listed subcontractor under Section 4104 or a substitute for a listed subcontractor.
(B)The subcontract does not exceed one-half of 1 percent of the price of the prime contract.
(e)Skilled journeyperson means a worker who either:
(1)Graduated from an apprenticeship program for the applicable occupation that was approved by the chief or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(2)Has at least as many hours of on-the-job experience in the applicable occupation as would be required to graduate from an apprenticeship program for the applicable occupation that is approved by the chief.
SEC. 6.Section 10506.9 of the Public Contract Code is repealed.SEC. 7.Section 10506.9 is added to the Public Contract Code, to read:10506.9.(a)If a contractor, bidder, or other entity is required to provide an enforceable commitment that a skilled and trained workforce will be used to complete a contract or project, the commitment shall be made in an enforceable agreement with the university that provides both of the following:
(1)The contractor, bidder, or other entity, and its contractors and subcontractors at every tier, will comply with this article.
(2)The contractor, bidder, or other entity shall provide to the university, on a monthly basis while the project contract is being performed, a report demonstrating compliance with this article.
(b)If the contractor, bidder, or other entity fails to provide the monthly report required by this section, or provides a report that is incomplete, the university shall withhold further payments until a complete record is provided.
(c)If a monthly report does not demonstrate compliance with this article, the university shall withhold further payments until the contractor, bidder, or other entity provides a plan to achieve substantial compliance with this article, with respect to the relevant apprenticeable occupation, prior to completion of the contract or project.
(d)A monthly report provided to the university shall be a public record under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code) and shall be open to public inspection.
SEC. 8.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
(a)This article provides the Best Value Construction Contracting Program for the Regents of the University of California for projects over one million dollars ($1,000,000).
(b)The Regents of the University of California shall let any contract for a project pursuant to this article to the lowest responsible bidder or else reject all bids.
(c)The lowest responsible bidder may be selected on the basis of the best value to the university, as defined in Section 10506.5. In order to implement this method of selection, the Regents of the University of California shall adopt and publish procedures and required guidelines for evaluating the qualifications of the bidders that ensure that best value selections by the university are conducted in a fair and impartial manner. These procedures and guidelines shall conform to the requirements of Sections 10506.6 and 10506.7 and shall be mandatory for the university when using best value selection.
(d)If one or more of the bids is substantially equal to the lowest bid, and at least one of those bidders is a disadvantaged business enterprise, a women business enterprise, or a disabled veteran business enterprise, the Regents of the University of California may award the contract in accordance with the policies and procedures adopted pursuant to Section 10500.5.
(e)If the Regents of the University of California deem it to be for the best interest of the university, the regents may, on the refusal or failure of the successful bidder for a project to execute a tendered contract, award it to the second lowest responsible bidder. If the second lowest responsible bidder fails or refuses to execute the contract, the regents may likewise award it to the third lowest responsible bidder.
SEC. 3.Section 10506.5 of the Public Contract Code is amended to read:10506.5.For purposes of this article, the following definitions apply:
(a)Best value means a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria for evaluating the qualifications of bidders with the resulting selection representing the best combination of price and qualifications.
(b)Best value contract means a contract entered into pursuant to the provisions of this article.
(c)Best value contractor means a properly licensed person, firm, or corporation that submits a bid for, or is awarded, a best value contract.
(d)Demonstrated management competency means the experience, competency, capability, and capacity of the proposed management staffing to complete projects of similar size, scope, or complexity.
(e)Financial condition means the financial resources needed to perform the contract. The criteria used to evaluate a bidders financial condition shall include, at a minimum, capacity to obtain all required payment bonds, performance bonds, and liability insurance.
(f)Labor compliance means the ability to comply with, and past performance with, contract and statutory requirements for the payment of wages and qualifications of the workforce. The criteria used to evaluate a bidders labor compliance shall include, as a minimum, the bidders ability to comply with the apprenticeship requirements of the California Apprenticeship Council and the Department of Industrial Relations, its past conformance with such requirements, and its past conformance with requirements to pay prevailing wages on public works projects.
(g)Project labor agreement means a prehire collective bargaining agreement that establishes terms and conditions of employment for a specific construction project or projects and is an agreement described in Section 158(f) of Title 29 of the United States Code.
(h)Qualifications means financial condition, relevant experience, demonstrated management competency, labor compliance, the safety record of the bidder, and, if required by the bidding documents, some or all of the preceding qualifications as they pertain to subcontractors proposed to be used by the bidder for designated portions of the work.
(i)Relevant experience means the experience, competency, capability, and capacity to complete projects of similar size, scope, or complexity.
(j)Safety record means the prior history concerning the safe performance of construction contracts. The criteria used to evaluate a bidders safety record shall include, as a minimum, its experience modification rate for the most recent three-year period, and its average total recordable injury or illness rate and average lost work rate for the most recent three-year period.
(k)University means all locations of the University of California.
SEC. 4.Section 10506.6 of the Public Contract Code is amended to read:10506.6.The university shall proceed in accordance with the following when awarding best value contracts under this article.
(a)The university shall prepare a solicitation for bids and give notice pursuant to Section 10502.
(b)The university shall establish a procedure to prequalify bidders. The information required pursuant to this section shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. Information submitted by the bidder as part of the evaluation process shall not be open to public inspection to the extent that information is exempt from disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(c)(1)A best value contractor shall not be prequalified or shortlisted unless the entity provides an enforceable commitment to the Regents of the University of California that the best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with Sections 10506.8 and 10506.9.
(2)This subdivision shall not apply if any of the following requirements are met:
(A)The Regents of the University of California have entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or contract to use a skilled and trained workforce, and the entity agrees to be bound by that project labor agreement.
(B)The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the Regents of the University of California prior to January 1, 2018.
(C)The best value contractor has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or contract to use a skilled and trained workforce.
(3)For purposes of this subdivision, project labor agreement has the same meaning as in subdivision (g) of Section 10506.5.
(d)Each solicitation for bids shall do all of the following:
(1)Invite prequalified bidders to submit sealed bids in the manner prescribed by this article.
(2)Include a section identifying and describing the following:
(A)Criteria that the university will consider in evaluating the qualifications of the bidders.
(B)The methodology and rating or weighting system that will be used by the university in evaluating bids.
(C)The relative importance or weight assigned to the criteria for evaluating the qualifications of bidders identified in the request for bids.
(e)Final evaluation of the best value contractor shall be done in a manner that prevents cost or price information from being revealed to the committee evaluating the qualifications of the bidders prior to completion and announcement of that committees decision.
SEC. 5.Section 10506.8 is added to the Public Contract Code, to read:10506.8.For purposes of this article:
(a)Apprenticeable occupation means an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program pursuant to Section 3075 of the Labor Code before January 1, 2014.
(b)Chief means the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
(c)Graduate of an apprenticeship program means either of the following:
(1)An individual who has been issued a certificate of completion under the authority of the California Apprenticeship Council for completing an apprenticeship program approved by the chief pursuant to Section 3075 of the Labor Code.
(2)An individual who has completed an apprenticeship program located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(d)Skilled and trained workforce means a workforce that meets all of the following requirements:
(1)All of the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the chief.
(2)(A)For For work performed on or after January 1, 2017, at least 30 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the occupation of teamster.
(B)For work performed on or after January 1, 2018, at least 40 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(B)(C)For work performed on or after January 1, 2019, at least 50 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractor subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(C)(D)For work performed on or after January 1, 2020, at least 60 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation. This requirement shall not apply to work performed in the following occupations: acoustical installer, bricklayer, carpenter, cement mason, drywall installer or lather, marble mason, finisher, or setter, modular furniture or systems installer, operating engineer, pile driver, plasterer, roofer or waterproofer, stone mason, surveyor, teamster, terrazzo worker or finisher, and tile layer, setter, or finisher.
(3)For an applicable occupation in which no apprenticeship program had been approved by the chief before January 1, 1995, up to one-half of the graduation percentage requirement of paragraph (2) may be satisfied by skilled journeypersons who commenced working in the apprenticeable occupation before the chiefs approval of an apprenticeship program for that occupation in the county in which the project is located.
(4)The apprenticeship graduation percentage requirements of paragraph (2) are satisfied if, in a calendar month, either of the following occurs:
(A)At least the required percentage of the skilled journeypersons employed by the contractor or subcontractor to perform work on the contract or project meet the graduation percentage requirements.
(B)For the hours of work performed by skilled journeypersons employed by the contractor or subcontractor on the contract or project, the percentage of hours performed by skilled journeypersons who meet the graduation requirement is at least equal to the required graduation percentage.
(5)The contractor or subcontractor need not meet the apprenticeship graduation requirements of paragraph (2) if, during the calendar month, the contractor or subcontractor employs skilled journeypersons to perform fewer than 10 hours of work on the contract or project.
(6)A subcontractor need not meet the apprenticeship requirements of paragraph (2) if both of the following requirements are met:
(A)The subcontractor was not a listed subcontractor under Section 4104 or a substitute for a listed subcontractor.
(B)The subcontract does not exceed one-half of 1 percent of the price of the prime contract.
(e)Skilled journeyperson means a worker who either:
(1)Graduated from an apprenticeship program for the applicable occupation that was approved by the chief or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(2)Has at least as many hours of on-the-job experience in the applicable occupation as would be required to graduate from an apprenticeship program for the applicable occupation that is approved by the chief.
SEC. 6.Section 10506.9 of the Public Contract Code is repealed.SEC. 7.Section 10506.9 is added to the Public Contract Code, to read:10506.9.(a)If a contractor, bidder, or other entity is required to provide an enforceable commitment that a skilled and trained workforce will be used to complete a contract or project, the commitment shall be made in an enforceable agreement with the university that provides both of the following:
(1)The contractor, bidder, or other entity, and its contractors and subcontractors at every tier, will comply with this article.
(2)The contractor, bidder, or other entity shall provide to the university, on a monthly basis while the project contract is being performed, a report demonstrating compliance with this article.
(b)If the contractor, bidder, or other entity fails to provide the monthly report required by this section, or provides a report that is incomplete, the university shall withhold further payments until a complete record is provided.
(c)If a monthly report does not demonstrate compliance with this article, the university shall withhold further payments until the contractor, bidder, or other entity provides a plan to achieve substantial compliance with this article, with respect to the relevant apprenticeable occupation, prior to completion of the contract or project.
(d)A monthly report provided to the university shall be a public record under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code) and shall be open to public inspection.
SEC. 8.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
(a)This article provides the Best Value Construction Contracting Program for the Regents of the University of California for projects over one million dollars ($1,000,000).
(b)The Regents of the University of California shall let any contract for a project pursuant to this article to the lowest responsible bidder or else reject all bids.
(c)The lowest responsible bidder may be selected on the basis of the best value to the university, as defined in Section 10506.5. In order to implement this method of selection, the Regents of the University of California shall adopt and publish procedures and required guidelines for evaluating the qualifications of the bidders that ensure that best value selections by the university are conducted in a fair and impartial manner. These procedures and guidelines shall conform to the requirements of Sections 10506.6 and 10506.7 and shall be mandatory for the university when using best value selection.
(d)If one or more of the bids is substantially equal to the lowest bid, and at least one of those bidders is a disadvantaged business enterprise, a women business enterprise, or a disabled veteran business enterprise, the regents Regents of the University of California may award the contract in accordance with the policies and procedures adopted pursuant to Section 10500.5.
(e)If the regents Regents of the University of California deem it to be for the best interest of the university, the regents may, on the refusal or failure of the successful bidder for a project to execute a tendered contract, award it to the second lowest responsible bidder. If the second lowest bidder fails or refuses to execute the contract, the regents may likewise award it to the third lowest responsible bidder.
SEC. 3.Section 10506.5 of the Public Contract Code is amended to read:10506.5.For purposes of this article, the following definitions apply:
(a)Best value means a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria for evaluating the qualifications of bidders with the resulting selection representing the best combination of price and qualifications.
(b)Best value contract means a contract entered into pursuant to the provisions of this article.
(c)Best value contractor means a properly licensed person, firm, or corporation that submits a bid for, or is awarded, a best value contract.
(d)Demonstrated management competency means the experience, competency, capability, and capacity of the proposed management staffing to complete projects of similar size, scope, or complexity.
(e)Financial condition means the financial resources needed to perform the contract. The criteria used to evaluate a bidders financial condition shall include, at a minimum, capacity to obtain all required payment bonds, performance bonds, and liability insurance.
(f)Labor compliance means the ability to comply with, and past performance with, contract and statutory requirements for the payment of wages and qualifications of the workforce. The criteria used to evaluate a bidders labor compliance shall include, as a minimum, the bidders ability to comply with the apprenticeship requirements of the California Apprenticeship Council and the Department of Industrial Relations, its past conformance with such requirements, and its past conformance with requirements to pay prevailing wages on public works projects.
(g)Project labor agreement means a prehire collective bargaining agreement that establishes terms and conditions of employment for a specific construction project or projects and is an agreement described in Section 158(f) of Title 29 of the United States Code.
(g)(h)Qualifications means financial condition, relevant experience, demonstrated management competency, labor compliance, the safety record of the bidder, and, if required by the bidding documents, some or all of the preceding qualifications as they pertain to subcontractors proposed to be used by the bidder for designated portions of the work.
(h)(i)Relevant experience means the experience, competency, capability, and capacity to complete projects of similar size, scope, or complexity.
(i)(j)Safety record means the prior history concerning the safe performance of construction contracts. The criteria used to evaluate a bidders safety record shall include, as a minimum, its experience modification rate for the most recent three-year period, and its average total recordable injury or illness rate and average lost work rate for the most recent three-year period.
(j)(k)University means all locations of the University of California.
SEC. 2.SEC. 4.Section 10506.6 of the Public Contract Code is amended to read:10506.6.The university shall proceed in accordance with the following when awarding best value contracts under this article.
(a)The university shall prepare a solicitation for bids and give notice pursuant to Section 10502.
(b)The university shall establish a procedure to prequalify bidders. The information required pursuant to this section shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. Information submitted by the bidder as part of the evaluation process shall not be open to public inspection to the extent that information is exempt from disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(c)(1)A best value entity contractor shall not be prequalified or shortlisted unless the entity provides an enforceable commitment to the Regents of the University of California that the entity best value contractor and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1. Sections 10506.8 and 10506.9.
(2)This subdivision shall not apply if any of the following requirements are met:
(A)The Regents of the University of California have entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or contract to use a skilled and trained workforce, and the entity agrees to be bound by that project labor agreement.
(B)The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the Regents of the University of California prior to January 1, 2018.
(C)The entity best value contractor has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or contract to use a skilled and trained workforce.
(3)For purposes of this subdivision, project labor agreement has the same meaning as in paragraph (1) of subdivision (b) of Section 2500. subdivision (g) of Section 10506.5.
(d)Each solicitation for bids shall do all of the following:
(1)Invite prequalified bidders to submit sealed bids in the manner prescribed by this article.
(2)Include a section identifying and describing the following:
(A)Criteria that the university will consider in evaluating the qualifications of the bidders.
(B)The methodology and rating or weighting system that will be used by the university in evaluating bids.
(C)The relative importance or weight assigned to the criteria for evaluating the qualifications of bidders identified in the request for bids.
(e)Final evaluation of the best value contractor shall be done in a manner that prevents cost or price information from being revealed to the committee evaluating the qualifications of the bidders prior to completion and announcement of that committees decision.
SEC. 5.Section 10506.8 is added to the Public Contract Code, to read:10506.8.For purposes of this article:
(a)Apprenticeable occupation means an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program pursuant to Section 3075 of the Labor Code before January 1, 2014.
(b)Chief means the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
(c)Graduate of an apprenticeship program means either of the following:
(1)An individual who has been issued a certificate of completion under the authority of the California Apprenticeship Council for completing an apprenticeship program approved by the chief pursuant to Section 3075 of the Labor Code.
(2)An individual who has completed an apprenticeship program located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(d)Skilled and trained workforce means a workforce that meets all of the following requirements:
(1)All of the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the chief.
(2)(A)For work performed on or after January 1, 2018, at least 40 percent of the skilled journeypersons employed to perform work in the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
(B)For work performed on or after January 1, 2019, at least 50 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractor at every tier are graduates of an apprenticeship program for the applicable occupation.
(C)For work performed on or after January 1, 2020, at least 60 percent of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
(3)For an applicable occupation in which no apprenticeship program had been approved by the chief before January 1, 1995, up to one-half of the graduation percentage requirement of paragraph (2) may be satisfied by skilled journeypersons who commenced working in the apprenticeable occupation before the chiefs approval of an apprenticeship program for that occupation in the county in which the project is located.
(4)The apprenticeship graduation percentage requirements of paragraph (2) are satisfied if, in a calendar month, either of the following occurs:
(A)At least the required percentage of the skilled journeypersons employed by the contractor or subcontractor to perform work on the contract or project meet the graduation percentage requirements.
(B)For the hours of work performed by skilled journeypersons employed by the contractor or subcontractor on the contract or project, the percentage of hours performed by skilled journeypersons who meet the graduation requirement is at least equal to the required graduation percentage.
(5)The contractor or subcontractor need not meet the apprenticeship graduation requirements of paragraph (2) if, during the calendar month, the contractor or subcontractor employs skilled journeypersons to perform fewer than 10 hours of work on the contract or project.
(6)A subcontractor need not meet the apprenticeship requirements of paragraph (2) if both of the following requirements are met:
(A)The subcontractor was not a listed subcontractor under Section 4104 or a substitute for a listed subcontractor.
(B)The subcontract does not exceed one-half of 1 percent of the price of the prime contract.
(e)Skilled journeyperson means a worker who either:
(1)Graduated from an apprenticeship program for the applicable occupation that was approved by the chief or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(2)Has at least as many hours of on-the-job experience in the applicable occupation as would be required to graduate from an apprenticeship program for the applicable occupation that is approved by the chief.
SEC. 3.SEC. 6.Section 10506.9 of the Public Contract Code is repealed.SEC. 7.Section 10506.9 is added to the Public Contract Code, to read:10506.9.(a)If a contractor, bidder, or other entity is required to provide an enforceable commitment that a skilled and trained workforce will be used to complete a contract or project, the commitment shall be made in an enforceable agreement with the university that provides both of the following:
(1)The contractor, bidder, or other entity, and its contractors and subcontractors at every tier, will comply with this article.
(2)The contractor, bidder, or other entity shall provide to the university, on a monthly basis while the project contract is being performed, a report demonstrating compliance with this article.
(b)If the contractor, bidder, or other entity fails to provide the monthly report required by this section, or provides a report that is incomplete, the university shall withhold further payments until a complete record is provided.
(c)If a monthly report does not demonstrate compliance with this article, the university shall withhold further payments until the contractor, bidder, or other entity provides a plan to achieve substantial compliance with this article, with respect to the relevant apprenticeable occupation, prior to completion of the contract or project.
(d)A monthly report provided to the university shall be a public record under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code) and shall be open to public inspection.
SEC. 4.SEC. 8.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
CORRECTIONS: HeadingLast amended date.(a)This article provides the Best Value Construction Contracting Program for the Regents of the University of California for projects over one million dollars ($1,000,000).
(b)The Regents of the University of California shall let any contract for a project pursuant to this article to the lowest responsible bidder or else reject all bids.
(c)The lowest responsible bidder may be selected on the basis of the best value to the university, as defined in Section 10506.5. In order to implement this method of selection, the Regents of the University of California shall adopt and publish procedures and required guidelines for evaluating the qualifications of the bidders that ensure that best value selections by the university are conducted in a fair and impartial manner. These procedures and guidelines shall conform to the requirements of Sections 10506.6 and 10506.7 and shall be mandatory for the university when using best value selection.
(d)If one or more of the bids is substantially equal to the lowest bid, and at least one of those bidders is a disadvantaged business enterprise, a women business enterprise, or a disabled veteran business enterprise, the regents may award the contract in accordance with the policies and procedures adopted pursuant to Section 10500.5.
(e)If the regents deem it to be for the best interest of the university, the regents may, on the refusal or failure of the successful bidder for a project to execute a tendered contract, award it to the second lowest responsible bidder. If the second lowest bidder fails or refuses to execute the contract, the regents may likewise award it to the third lowest responsible bidder.
SEC. 2.Section 10506.6 of the Public Contract Code is amended to read:10506.6.The university shall proceed in accordance with the following when awarding best value contracts under this article.
(a)The university shall prepare a solicitation for bids and give notice pursuant to Section 10502.
(b)The university shall establish a procedure to prequalify bidders. The information required pursuant to this section shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. Information submitted by the bidder as part of the evaluation process shall not be open to public inspection to the extent that information is exempt from disclosure under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code).
(c)(1)A best value entity shall not be prequalified or shortlisted unless the entity provides an enforceable commitment to the Regents of the University of California that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades, in accordance with Chapter 2.9 (commencing with Section 2600) of Part 1.
(2)This subdivision shall not apply if any of the following requirements are met:
(A)The Regents of the University of California have entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or contract to use a skilled and trained workforce, and the entity agrees to be bound by that project labor agreement.
(B)The project or contract is being performed under the extension or renewal of a project labor agreement that was entered into by the Regents of the University of California prior to January 1, 2018.
(C)The entity has entered into a project labor agreement that will bind the entity and all its subcontractors at every tier performing the project or contract to use a skilled and trained workforce.
(3)For purposes of this subdivision, project labor agreement has the same meaning as in paragraph (1) of subdivision (b) of Section 2500.
(c)(d)Each solicitation for bids shall do all of the following:
(1)Invite prequalified bidders to submit sealed bids in the manner prescribed by this article.
(2)Include a section identifying and describing the following:
(A)Criteria that the university will consider in evaluating the qualifications of the bidders.
(B)The methodology and rating or weighting system that will be used by the university in evaluating bids.
(C)The relative importance or weight assigned to the criteria for evaluating the qualifications of bidders identified in the request for bids.
(d)(e)Final evaluation of the best value contractor shall be done in a manner that prevents cost or price information from being revealed to the committee evaluating the qualifications of the bidders prior to completion and announcement of that committees decision.
SEC. 2.SEC. 3.Section 10506.9 of the Public Contract Code is repealed.SEC. 3.SEC. 4.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
(a)This article provides the Best Value Construction Contracting Pilot Program for the Regents of the University of California for projects over one million dollars ($1,000,000).
(b)The Regents of the University of California shall let any contract for a project pursuant to this article to the lowest responsible bidder or else reject all bids.
(c)The lowest responsible bidder may be selected on the basis of the best value to the university, as defined in Section 10506.5. In order to implement this method of selection, the Regents of the University of California shall adopt and publish procedures and required guidelines for evaluating the qualifications of the bidders that ensure that best value selections by the university are conducted in a fair and impartial manner. These procedures and guidelines shall conform to the requirements of Sections 10506.6 and 10506.7 and shall be mandatory for the university when using best value selection.
(d)If one or more of the bids is substantially equal to the lowest bid, and at least one of those bidders is a disadvantaged business enterprise, a women business enterprise, or a disabled veteran business enterprise, the regents may award the contract in accordance with the policies and procedures adopted pursuant to Section 10500.5.
(e)If the regents deem it to be for the best interest of the university, the regents may, on the refusal or failure of the successful bidder for a project to execute a tendered contract, award it to the second lowest responsible bidder. If the second lowest bidder fails or refuses to execute the contract, the regents may likewise award it to the third lowest responsible bidder.
SEC. 2.Section 10506.9 of the Public Contract Code is repealed.10506.9.This article shall remain in effect only until January 1, 2018, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2018, deletes or extends that date.SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
|
Date
|
Status
|
|---|---|
| Oct 15, 2017 | Chaptered by Secretary of State - Chapter 850, Statutes of 2017. |
| Oct 15, 2017 | Approved by the Governor. |
| Sep 13, 2017 | Enrolled and presented to the Governor at 4 p.m. |
| Sep 7, 2017 | Senate amendments concurred in. To Engrossing and Enrolling. |
| Sep 5, 2017 | In Assembly. Concurrence in Senate amendments pending. May be considered on or after September 7 pursuant to Assembly Rule 77. |
| Sep 5, 2017 | Read third time. Passed. Ordered to the Assembly. |
| Aug 23, 2017 | Read second time. Ordered to third reading. |
| Aug 22, 2017 | Read third time and amended. Ordered to second reading. |
| Jul 11, 2017 | Read second time. Ordered to third reading. |
| Jul 10, 2017 | From committee: Be ordered to second reading pursuant to Senate Rule 28.8. |
| Jun 28, 2017 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 5. Noes 2.) (June 28). Re-referred to Com. on APPR. |
| Jun 14, 2017 | Measure version as amended on June 12 corrected. |
| Jun 13, 2017 | In committee: Set, second hearing. Hearing canceled at the request of author. |
| Jun 12, 2017 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on ED. |
| May 30, 2017 | In committee: Set, first hearing. Hearing canceled at the request of author. |
| May 18, 2017 | Referred to Com. on ED. |
| May 8, 2017 | In Senate. Read first time. To Com. on RLS. for assignment. |
| May 8, 2017 | Read third time. Passed. Ordered to the Senate. (Ayes 58. Noes 19. Page 1425.) |
| May 4, 2017 | Read second time. Ordered to third reading. |
| May 3, 2017 | From committee: Do pass. (Ayes 12. Noes 4.) (May 3). |
| Apr 19, 2017 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 11. Noes 2.) (April 18). Re-referred to Com. on APPR. |
| Apr 17, 2017 | Re-referred to Com. on HIGHER ED. |
| Apr 6, 2017 | From committee chair, with author's amendments: Amend, and re-refer to Com. on HIGHER ED. Read second time and amended. |
| Mar 13, 2017 | Referred to Com. on HIGHER ED. |
| Feb 19, 2017 | From printer. May be heard in committee March 21. |
| Feb 17, 2017 | Read first time. To print. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Sep 7, 2017 | AB 1424 LEVINE Concurrence in Senate Amendments | Assembly Floor |
Passed |
|
| Sep 5, 2017 | Assembly 3rd Reading AB1424 Levine et al. By Allen | Senate Floor |
Passed |
|
| Jun 28, 2017 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Education |
Passed |
|
| May 8, 2017 | AB 1424 LEVINE Assembly Third Reading | Assembly Floor |
Passed |
|
| May 3, 2017 | Do pass. | Assembly Standing Committee on Appropriations |
Passed |
|
| Apr 18, 2017 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Higher Education |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| American Fire Sprinkler Association | ** Against | Aug 31, 2017 |
| Associated Builders and Contractors | ** Against | Aug 31, 2017 |
| Independent Roofing Contractors of California, Inc. | ** Against | Aug 31, 2017 |
| Plumbing-Heating-Cooling Contractors Association of California | ** Against | Aug 31, 2017 |
| State Building and Construction Trades Council of California | ** Support | Aug 31, 2017 |
| University of California | ** Support | Aug 31, 2017 |
| Western Electrical Contractors Association | ** Against | Aug 31, 2017 |
CONCURRENCE IN SENATE AMENDMENTS
CSA1 Bill Id:AB 1424
Author:(Levine)
As Amended Ver:August 22, 2017
Majority vote
ASSEMBLY: | 58-19 | (May 8, 2017) | SENATE: | 28-12 | (September 5, 2017) |
Original Committee Reference: HIGHER ED.
SUMMARY: Makes permanent the authority for the University of California (UC) to use best value contracting for construction projects; and, when using best value contracting, requires contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities
The Senate amendments:
- Exclude work performed by teamsters from the requirement that, beginning on January 1, 2017, at least 30% of skilled journeypersons employed to perform work on a project are graduates of an apprenticeship program.
- Exclude work performed by other specified occupations from the requirement that, beginning on January 1, 2018, at least 40% of skilled journeypersons are graduates from an apprenticeship program, and excludes these same occupations from subsequent years’ increases in that percentage. For the excluded occupations, the graduation percentage would remain at 30%.
- Revise the definition of "skilled and trained workforce" in the Public Contract Code (PCC) to exclude, from certain conditions, the work performed by specified occupations.
EXISTING LAW:
- Authorizes, until January 1, 2017, a pilot program at the UC to award construction contracts over $1 million, on a "best value" basis, rather than just to the lowest bidder (PCC Section 10506.4).
- Defines "best value," for purposes of the UC, as a procurement process whereby, the lowest responsible bidder may be selected on the basis of objective criteria with the resulting selection representing the best combination of price and qualifications (PCC Section 10506.5).
- Requires the UC Regents, on or before January 1, 2016, to submit a report to the appropriate policy committees of the Legislature and the Joint Legislative Budget Committee, regarding the pilot program (PCC Section 10506.8).
- Defines "skilled and trained workforce" as meeting all of the following conditions:
- All the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations;
- For work performed on or after January 1, 2017, at least 30% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation;
- For work performed on or after January 1, 2018, at least 40% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation;
- For work performed on or after January 1, 2019, at least 50% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation;
- For work performed on or after January 1, 2020, at least 60% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation; and,
- Defines "apprenticeable occupation" as an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program (PCC Section 2601).
FISCAL EFFECT: According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS: Background. Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this program, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid.
SB 667 (Migden), Chapter 367, Statutes of 2006, established the five-year Best Value Pilot Program at UC San Francisco. SB 835 (Wolk), Chapter 636, Statutes of 2011, extended the sunset in SB 667 until January 1, 2017, and expanded the best value pilot to encompass all UC campuses and medical centers. In a December 2015 report on the pilot project, UC noted that, since January 2012, it had awarded over 320 construction contracts totaling $4 billion. Forty of these contracts, or 13%, totaling $1.2 billion, utilized the best value construction authority. UC reported that these contracts provided numerous benefits, including decreases in bid protests, disputes, change order requests and claims, and reduced administrative oversight and contract/project management staff time.
In 2016, UC sponsored SB 1214 (Allen), Chapter 788, Statutes of 2016, which, like this bill, proposed to elimination the sunset on UC's authority to use best value contracting. Due to concerns raised by the State Building and Construction Trades Council regarding what they believed was the lack of uniformity in UC's best value statute and provisions governing similar contracting practices for other government entities, SB 1214, as enacted, simply extended the pilot program sunset by one year, to January 1, 2018.
Purpose. This measure sunsets the pilot program and makes permanent UC's authority to undertake best value contracting. Additionally, this bill conforms UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
Analysis Prepared by: Jeanice Warden / HIGHER ED. / (916) 319-3960 FN: 0001520
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB |
THIRD READING
Bill No: AB 1424
Amended: 8/22/17 in Senate
SENATE EDUCATION COMMITTEE: 5-2, 6/28/17
AYES: Allen, Galgiani, Leyva, Mendoza, Pan
NOES: Wilk, Vidak
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
ASSEMBLY FLOOR: 58-19, 5/8/17 - See last page for vote
SOURCE: University of California
DIGEST:
This bill makes permanent the authority for the University of California (UC) to use best value contracting for construction projects, and conforms UC’s best value contracting process related to use of a skilled and trained workforce to those of other state and local government entities.
Senate Floor Amendments of 8/22/17 revise the definition of “skilled and trained workforce” in the Public Contract Codes to exclude, from certain conditions, the work performed by specified occupations.
Existing law:
- Establishes, until January 2018, the Best Value Construction Contracting Pilot Program at the UC to award construction contracts over $1 million on a "best value" basis, rather than just to the lowest bidder.
- Defines "best value" for purposes of the UC as a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria, with the resulting selection representing the best combination of price and qualifications.
- Requires the UC Regents, on or before January 1, 2016, to submit a report to the appropriate policy committees of the Legislature and the Joint Legislative Budget Committee, regarding the pilot program.
- Defines “skilled and trained workforce” as meeting all of the following conditions:
- All the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the Department of Industrial Relations (DIR).
- For work performed on or after January 2017 through 2020 and after, at least 30 percent, increasing by 10 percent each year up to 60 percent, of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- Defines "apprenticeable occupation” as an occupation for which the DIR has approved an apprenticeship program.
This bill:
- Makes permanent the authority for the UC to use best value contracting for construction projects, and, when using best value contracting, requires contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities, with exceptions.
- Excludes work performed by teamsters from the requirement that, beginning on January 1, 2017, at least 30 percent of skilled journeypersons employed to perform work on a project are graduates of an apprenticeship program.
- Excludes work performed by other specified occupations from the requirement that, beginning on January 1, 2018, at least 40 percent of skilled journeypersons are graduates from an apprenticeship program, and excludes these same occupations from subsequent years’ increases in that percentage. For the excluded occupations, the graduation percentage would remain at 30 percent.
Comments
- Need for the bill. This bill ends the pilot program and makes permanent UC's authority to undertake best value contracting, while also conforming UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
- Best value contracting. Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this process, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid.
- Report on the pilot program. According to UC’s January 2016 report on the Best Value Construction Contract Pilot Program, the process has: (1) attracted thorough bids with an appropriate balance of focus on experience, quality, competency, and price; (2) increased the bidding pool of well-qualified and respected contractors, including many who had previously declined to bid on projects; (3) greatly eliminated bid risk to both the UC and contractors; and (4) reduced the number of change orders resulting from contractors underbidding projects.
Since January 1, 2012, UC awarded over 320 construction contracts totaling over $4 billion. Of these, 40 contracts totaling $1.2 billion utilized best value contracting. Projects that were completed as of September 2015 have been assessed and have been delivered on time and on budget, with a high level of quality and no claims. Those projects experienced minor change orders, largely limited to owner requested changes and unforeseen conditions. This experience, albeit of limited scope thus far, points to the efficacy of the Best Value selection process.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
University of California (source)
State Building and Construction Trades Council of California
OPPOSITION: (Verified 8/31/17)
American Fire Sprinkler Association
Associated Builders and Contractors
Independent Roofing Contractors of California, Inc.
Plumbing-Heating-Cooling Contractors Association of California
Western Electrical Contractors Association
ASSEMBLY FLOOR: 58-19, 5/8/17
AYES: Aguiar-Curry, Arambula, Baker, Berman, Bloom, Bocanegra, Bonta, Burke, Caballero, Calderon, Cervantes, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Cunningham, Dababneh, Daly, Eggman, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gomez, Gonzalez Fletcher, Gray, Grayson, Holden, Irwin, Kalra, Levine, Limón, Low, McCarty, Mullin, Muratsuchi, Nazarian, O'Donnell, Quirk, Quirk-Silva, Reyes, Ridley-Thomas, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Weber, Wood, Rendon
NOES: Acosta, Travis Allen, Bigelow, Brough, Chen, Choi, Dahle, Fong, Harper, Jones-Sawyer, Kiley, Lackey, Maienschein, Mathis, Mayes, Melendez, Obernolte, Voepel, Waldron
NO VOTE RECORDED: Flora, Medina, Patterson
8/31/17 10:09:56
**** END ****
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB |
THIRD READING
Bill No: AB 1424
:
SENATE EDUCATION COMMITTEE: 5-2, 6/28/17
AYES: Allen, Galgiani, Leyva, Mendoza, Pan
NOES: Wilk, Vidak
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
ASSEMBLY FLOOR: 58-19, 5/8/17 - See last page for vote
SOURCE: University of California
DIGEST:
This bill makes permanent the authority for the University of California (UC) to use best value contracting for construction projects, and conforms UC’s best value contracting process related to use of a skilled and trained workforce to those of other state and local government entities.
Existing law:
- Establishes, until January 2018, the Best Value Construction Contracting Pilot Program at the UC to award construction contracts over $1 million on a "best value" basis, rather than just to the lowest bidder.
- Defines "best value" for purposes of the UC as a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria, with the resulting selection representing the best combination of price and qualifications.
- Requires the UC Regents, on or before January 1, 2016, to submit a report to the appropriate policy committees of the Legislature and the Joint Legislative Budget Committee, regarding the pilot program.
- Defines “skilled and trained workforce” as meeting all of the following conditions:
- All the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the Department of Industrial Relations (DIR).
- For work performed on or after January 2017 through 2020 and after, at least 30 percent, increasing by 10 percent each year up to 60 percent, of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- Defines "apprenticeable occupation” as an occupation for which the DIR has approved an apprenticeship program.
This bill makes permanent the authority for the UC to use best value contracting for construction projects, and, when using best value contracting, requires contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities.
Comments
- Need for the bill. This bill ends the pilot program and makes permanent UC's authority to undertake best value contracting, while also conforming UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
- Best value contracting. Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this process, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid.
- Report on the pilot program. According to UC’s January 2016 report on the Best Value Construction Contract Pilot Program, the process has: (1) attracted thorough bids with an appropriate balance of focus on experience, quality, competency, and price; (2) increased the bidding pool of well-qualified and respected contractors, including many who had previously declined to bid on projects; (3) greatly eliminated bid risk to both the UC and contractors; and (4) reduced the number of change orders resulting from contractors underbidding projects.
Since January 1, 2012, UC awarded over 320 construction contracts totaling over $4 billion. Of these, 40 contracts totaling $1.2 billion utilized best value contracting. Projects that were completed as of September 2015 have been assessed and have been delivered on time and on budget, with a high level of quality and no claims. Those projects experienced minor change orders, largely limited to owner requested changes and unforeseen conditions. This experience, albeit of limited scope thus far, points to the efficacy of the Best Value selection process.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
University of California (source)
OPPOSITION: (Verified 7/11/17)
American Fire Sprinkler Association
Associated Builders and Contractors
Independent Roofing Contractors of California, Inc.
Plumbing-Heating-Cooling Contractors Association of California
Western Electrical Contractors Association
ASSEMBLY FLOOR: 58-19, 5/8/17
AYES: Aguiar-Curry, Arambula, Baker, Berman, Bloom, Bocanegra, Bonta, Burke, Caballero, Calderon, Cervantes, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Cunningham, Dababneh, Daly, Eggman, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gomez, Gonzalez Fletcher, Gray, Grayson, Holden, Irwin, Kalra, Levine, Limón, Low, McCarty, Mullin, Muratsuchi, Nazarian, O'Donnell, Quirk, Quirk-Silva, Reyes, Ridley-Thomas, Rodriguez, Rubio, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Weber, Wood, Rendon
NOES: Acosta, Travis Allen, Bigelow, Brough, Chen, Choi, Dahle, Fong, Harper, Jones-Sawyer, Kiley, Lackey, Maienschein, Mathis, Mayes, Melendez, Obernolte, Voepel, Waldron
NO VOTE RECORDED: Flora, Medina, Patterson
7/14/17 14:44:03
**** END ****
SENATE COMMITTEE ON EDUCATION
Senator Benjamin Allen, Chair
2017 - 2018 Regular
Bill No: AB 1424 Hearing Date: June 28, 2017
Author: | |||
Version: | June 12, 2017 | ||
Urgency: | No | Fiscal: | Yes |
Consultant: | Ian Johnson | ||
Subject: University of California: Best Value Construction Contracting Program
SUMMARY
This bill makes permanent the authority for the University of California (UC) to use best value contracting for construction projects, and conforms UC’s best value contracting process related to use of a skilled and trained workforce to those of other state and local government entities.
BACKGROUND
Existing law:
- Establishes, until January 2018, the Best Value Construction Contracting Pilot Program at the UC to award construction contracts over $1 million on a "best value" basis, rather than just to the lowest bidder.
- Defines "best value" for purposes of the UC as a procurement process whereby the lowest responsible bidder may be selected on the basis of objective criteria, with the resulting selection representing the best combination of price and qualifications.
- Required the UC Regents, on or before January 1, 2016, to submit a report to the appropriate policy committees of the Legislature and the Joint Legislative Budget Committee, regarding the pilot program.
- Defines “skilled and trained workforce” as meeting all of the following conditions:
- All the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the Department of Industrial Relations (DIR).
- For work performed on or after January 2017 through 2020 and after, at least 30 percent, increasing by 10 percent each year up to 60 percent, of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- Defines "apprenticeable occupation” as an occupation for which the DIR has approved an apprenticeship program.
ANALYSIS
This bill makes permanent the authority for the University of California (UC) to use best value contracting for construction projects, and, when using best value contracting, requires contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities.
STAFF COMMENTS
- Need for the bill. This bill ends the pilot program and makes permanent UC's authority to undertake best value contracting, while also conforming UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
- Best value contracting. Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this process, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid.
- Report on the pilot program. According to UC’s January 2016 report on the Best Value Construction Contract Pilot Program, the process has: (1) attracted thorough bids with an appropriate balance of focus on experience, quality, competency, and price; (2) increased the bidding pool of well-qualified and respected contractors, including many who had previously declined to bid on projects; (3) greatly eliminated bid risk to both the UC and contractors; and (4) reduced the number of change orders resulting from contractors underbidding projects.
Since January 1, 2012, UC awarded over 320 construction contracts totaling over $4 billion. Of these, 40 contracts totaling $1.2 billion utilized best value contracting. Projects that were completed as of September 2015 have been assessed and have been delivered on time and on budget, with a high level of quality and no claims. Those projects experienced minor change orders, largely limited to owner requested changes and unforeseen conditions. This experience, albeit of limited scope thus far, points to the efficacy of the Best Value selection process.
- Prior legislation.
SB 1214 (Allen, Chapter 788, Statutes of 2016) extended the sunset of the Best Value Construction Contracting Pilot Program by one year, until January 2018.
SB 693 (Hueso, Chapter 774, Statutes of 2016) consolidated the skilled and trained workforce requirements of various provisions of law related to alternative construction delivery methods, defined the terms of these requirements, and made other conforming changes.
SB 835 (Wolk, Chapter 636, Statutes of 2011) extended the sunset of the Best Value Construction Contracting Pilot Program until January 2017, and expanded the pilot to all University of California campuses and medical centers.
SB 667 (Migden, Chapter 367, Statutes of 2006) established the five-year Best Value Construction Contracting Pilot Program at UC San Francisco.
SUPPORT
University of California (Sponsor)
OPPOSITION
American Fire Sprinkler Association
Associated Builders and Contractors
Independent Roofing Contractors of California, Inc.
Plumbing-Heating-Cooling Contractors Association of California
Western Electrical Contractors Association
-- END --
ASSEMBLY THIRD READING
ATR Bill Id:AB 1424
Author:(Levine)
As Amended Ver:April 6, 2017
Majority vote
Committee | Votes | Ayes | Noes |
Higher Education | 11-2 | Medina, Baker, Arambula, Bloom, Chávez, Irwin, Levine, Low, Quirk-Silva, Santiago, Weber | Choi, Kiley |
Appropriations | 12-4 | Gonzalez Fletcher, Bloom, Bocanegra, Bonta, Calderon, Chau, Eggman, Friedman, Gallagher, Eduardo Garcia, Muratsuchi, Reyes | Bigelow, Brough, Fong, Obernolte |
SUMMARY: Eliminates the sunset on the University of California's (UC's) authority to use the best value procurement method for construction contracting, and requires UC, when using best value contracting, to require contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities.
EXISTING LAW:
- Authorizes, until January 1, 2017, a pilot program at the UC to award construction contracts over $1 million, on a "best value" basis, rather than just to the lowest bidder. (Public Contract Code (PCC) Section 10506.4)
- Defines "best value," for purposes of the UC, as a procurement process whereby, the lowest responsible bidder may be selected on the basis of objective criteria with the resulting selection representing the best combination of price and qualifications. (PCC Section 10506.5)
- Requires the UC Regents, on or before January 1, 2016, to submit a report to the appropriate policy committees of the Legislature and the Joint Legislative Budget Committee, regarding the pilot program. (PCC Section 10506.8)
- Defines "skilled and trained workforce" as meeting all of the following conditions:
- All the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
- For work performed on or after January 1, 2017, at least 30% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- For work performed on or after January 1, 2018, at least 40% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- For work performed on or after January 1, 2019, at least 50% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- For work performed on or after January 1, 2020, at least 60% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- Defines "apprenticeable occupation" as an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program. (PCC Section 2601.)
FISCAL EFFECT: According to the Assembly Appropriations Committee, no fiscal impact. This is not a reimbursable mandate. This bill authorizes UC to use best value procurement indefinitely to realize ongoing significant savings in both contract and contract administration costs due to increased efficiencies, cost avoidance resulting from lack of bid protests and litigation.
COMMENTS:
Background. Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this program, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid.
SB 667 (Migden), Chapter 367, Statutes of 2006, established the five-year Best Value Pilot Program at UC San Francisco. SB 835 (Wolk), Chapter 636, Statutes of 2011, extended the sunset in SB 667 until January 1, 2017, and expanded the best value pilot to encompass all UC campuses and medical centers. In a December 2015 report on the pilot project, UC noted that, since January 2012, it had awarded over 320 construction contracts totaling $4 billion. Forty of these contracts, or 13%, totaling $1.2 billion, utilized the best value construction authority. UC reported that these contracts provided numerous benefits, including decreases in bid protests, disputes, change order requests and claims, and reduced administrative oversight and contract/project management staff time.
In 2016, UC sponsored SB 1214 (Allen), Chapter 788, Statutes of 2016, which, like this bill, proposed to elimination the sunset on UC's authority to use best value contracting. Due to concerns raised by the State Building and Construction Trades Council regarding what they believed was the lack of uniformity in UC's best value statute and provisions governing similar contracting practices for other government entities, SB 1214, as enacted, simply extended the pilot program sunset by one year, to January 1, 2018.
Purpose. This bill ends the pilot program and makes permanent UC's authority to undertake best value contracting. In response to the building trades concerns, the bill also conforms UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
Analysis Prepared by: Chuck Nicol / HIGHER ED. / (916) 319-3960 FN: 0000243
Date of Hearing: May 3, 2017
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez Fletcher, Chair
ABPCA Bill Id:AB 1424
Author:(Levine) – As Amended Ver:April 6, 2017
Policy Committee: | Higher Education | Vote: | 11 - 2 |
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Urgency: No State Mandated Local Program: Yes Reimbursable: No
SUMMARY:
This bill eliminates the sunset on the University of California's (UC's) authority to use the best value procurement method for construction contracting, and requires UC, when using best value contracting, to require contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities.
FISCAL EFFECT:
No fiscal impact. This is not a reimbursable mandate. This bill authorizes UC to use best value procurement indefinitely to realize ongoing significant savings in both contract and contract administration costs due to increased efficiencies, cost avoidance resulting from lack of bid protests and litigation.
COMMENTS:
- Background. Existing law authorizes, until January 1, 2017, a pilot program at the UC to award construction contracts over $1 million, on a "best value" basis, rather than just to the lowest bidder. "Best value," for purposes of the UC, is defined as a procurement process whereby, the lowest responsible bidder may be selected on the basis of objective criteria with the resulting selection representing the best combination of price and qualifications.
Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this program, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid. SB 667 (Migden), Chapter 367, Statutes of 2006, established the five-year Best Value Pilot Program at UC San Francisco. SB 835 (Wolk), Chapter 636, Statutes of 2011, extended the sunset in SB 667 until January 1, 2017, and expanded the best value pilot to encompass all UC campuses and medical centers.
Since the pilot was expanded systemwide, UC has awarded 320 construction contracts totaling approximately $4 billion. Of this total, 40 contracts totaling $1.2 billion were awarded using best value selection. These contracts included classrooms, student housing, laboratories, and medical facilities.
- Purpose. This bill ends the pilot program and makes permanent UC's authority to undertake best value contracting. In response to the building trades concerns, the bill also conforms UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
Analysis Prepared by: Daisy Gonzales / APPR. / (916) 319-2081
Date of Hearing: April 18, 2017
ASSEMBLY COMMITTEE ON HIGHER EDUCATION
Jose Medina, Chair
ABPCA Bill Id:AB 1424 (
Author:Levine) – As Amended Ver:April 6, 2017
SUBJECT: University of California: Best Value Construction Contracting Program
SUMMARY: Eliminates the sunset on the University of California's (UC's) authority to use the best value procurement method for construction contracting, and requires UC, when using best value contracting, to require contractors and all subcontractors to conform with the skilled and trained workforce requirements applicable to alternative construction delivery methods authorized in statute for use by other state or local government entities.
EXISTING LAW:
- Authorizes, until January 1, 2017, a pilot program at the UC to award construction contracts over $1 million, on a "best value" basis, rather than just to the lowest bidder. (Public Contract Code (PCC) Section 10506.4)
- Defines "best value," for purposes of the UC, as a procurement process whereby, the lowest responsible bidder may be selected on the basis of objective criteria with the resulting selection representing the best combination of price and qualifications. (PCC Sect. 10506.5)
- Requires the UC Regents, on or before January 1, 2016, to submit a report to the appropriate policy committees of the Legislature and the Joint Legislative Budget Committee, regarding the pilot program. (PCC Sect. 10506.8)
- Defines "skilled and trained workforce” as meeting all of the following conditions:
- All the workers performing work in an apprenticeable occupation in the building and construction trades are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
- For work performed on or after January 1, 2017, at least 30% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- For work performed on or after January 1, 2018, at least 40% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- For work performed on or after January 1, 2019, at least 50% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- For work performed on or after January 1, 2020, at least 60% of the skilled journeypersons employed to perform work on the contract or project by every contractor and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation.
- Defines "apprenticeable occupation” as an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations has approved an apprenticeship program. (PCC Sect. 2601.)
FISCAL EFFECT: According to the Assembly Appropriations Committee's analysis of a 2016 bill extending the sunset on the pilot program, based on the results of UC's use of best value procurement, the university could realize ongoing significant savings in both contract and contract administration costs.
COMMENTS:
Background. Best value procurement is an alternative to the traditional design-bid-build method of public works contracting. Under this program, UC prequalifies bidders, then evaluates the bid and assigns a qualification score based upon five factors, which include the bidder's financial condition, relevant experience, demonstrated management competency, labor compliance, and safety record. UC then divides each bidder's price by its qualification score, and the lowest resulting cost per quality point represents the best value bid.
SB 667 (Migden),Chapter 367, Statutes of 2006, established the five-year Best Value Pilot Program at UC San Francisco. SB 835 (Wolk), Chapter 636, Statutes of 2011, extended the sunset in SB 667 until January 1, 2017, and expanded the best value pilot to encompass all UC campuses and medical centers. In a December 2015 report on the pilot project, UC noted that, since January 2012, it had awarded over 320 construction contracts totaling $4 billion. Forty of these contracts, or 13%, totaling $1.2 billion, utilized the best value construction authority. UC reported that these contracts provided numerous benefits, including decreases in bid protests, disputes, change order requests and claims, and reduced administrative oversight and contract/project management staff time.
In 2016, UC sponsored SB 1214 (Allen), which, like this bill, proposed to elimination the sunset on UC's authority to use best value contracting. Due to concerns raised by the State Building and Construction Trades Council regarding what they believed was the lack of uniformity in UC's best value statute and provisions governing similar contracting practices for other government entities, SB 1214, as enacted, simply extended the pilot program sunset by one year, to January 1, 2018.
Purpose. This bill ends the pilot program and makes permanent UC's authority to undertake best value contracting. In response to the building trades concerns, the bill also conforms UC's best value contracting provisions to similar statutes for other government entities with respect to requirements for use of a skilled and trained workforce.
REGISTERED SUPPORT / OPPOSITION:
Support
University of California (sponsor)
Opposition
None on file.
Analysis Prepared by: Chuck Nicol / HIGHER ED. / (916) 319-3960
Bill Author
Bill Co-Author(s):