AB 2762: Public contracts: disabled veteran business enterprises: local small business enterprises: social enterprises.

Existing law authorizes a local agency in facilitating contract awards to small businesses to provide for a small business preference of 5% in construction, the procurement of goods, or the delivery of services, and establishes a subcontracting participation goal for small businesses on contracts with a 5% preference for those bidders who meet the goal. Existing law authorizes each local agency to define a small business for the purposes of these preferences and goals.

This bill would increase the above-described preference for small business to 7%. The bill, until January 1, 2024, would also establish preferences, in specified counties, for disabled veteran businesses and social enterprises, as defined, and would provide for the preferences to be a maximum of 7% for an individual preference and up to 15% for a single bid having 2 or more preferences. The bill would limit the value of a preference to a maximum of $150,000 under these provisions. The bill would authorize a prime contractor, with the approval of the local agency, and subject to meeting specified conditions, to substitute another subcontractor for the purpose of meeting specified goals. The bill would require that the policy under which a prime contractor may substitute a subcontractor contain, among other things, a requirement that construction subcontractors awarded construction subcontracts be afforded all the protections of the Subletting and Subcontracting Fair Practices Act and a requirement that the condition qualifying the substitution be verified with the subcontractor. The bill would require each local agency within specified counties that chooses to grant a preference under these provisions to define a small business, disabled veteran business, and social enterprise and to define their eligibility for the purposes of these preferences and goals and to establish a certification process for social enterprises using specified criteria. The bill would also authorize each local agency to define a disabled veteran business and social enterprise and to define their eligibility for the purposes of these preferences and goals.

This bill would make legislative findings and declarations as to the necessity of a special statute for the Counties of Alameda, Contra Costa, Lake, Los Angeles, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, and Sonoma.