Existing law, the Uniform Public Construction Cost Accounting Act, authorizes a public agency which has, by resolution, elected to become subject to uniform construction cost accounting procedures. Existing law provides for the development of cost accounting standards and an alternative method for the bidding of public works projects by public entities. The act defines public project to include, among other things, construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility.

This bill would define public project to additionally include installations involving any publicly owned, leased, or operated facility.

The Uniform Public Construction Cost Accounting Act authorizes public projects of $60,000 or less to be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order, authorizes public projects of $200,000 or less to be let to contract by informal procedures, and requires public projects of more than $200,000 to be let to contract by formal bidding procedures. The act permits the governing body of a public agency, in the event all bids received for the performance of that public project are in excess of $200,000, to award the contract at $212,500 or less to the lowest responsible bidder if it determines the cost estimate of the public agency was reasonable.

This bill would instead authorize public projects of $75,000 or less to be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order, authorize public projects of $220,000 or less to be let to contract by informal procedures, and require public projects of more than $220,000 to be let to contract by formal bidding procedures. The bill would permit the governing body of a public agency, in the event all bids received for the performance of that public project are in excess of $220,000, to award the contract at $235,000 or less to the lowest responsible bidder if it determines the cost estimate of the public agency was reasonable. The bill would also make conforming changes.

The Uniform Public Construction Cost Accounting Act creates the California Uniform Construction Cost Accounting Commission, to fulfill certain duties, including recommending for adoption by the Controller uniform construction cost accounting procedures for implementation by public agencies in the performance of, or in contracting for, construction on public projects. The act requires the commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency falls into specified categories, including that the public agency has exceeded the force account limits. The act also requires the commission to review practices of any participating public agency where an interested party presents evidence that the public agency is not in compliance with requirements to enact a prescribed informal bidding ordinance to govern the selection of contractors to perform public projects.

This bill would additionally require the commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency has been split or separated into smaller work orders or projects, as specified, and would make conforming changes. The bill would also require the commission to review noncompliance with bidding procedures for the publication or posting and electronic transmission of notice inviting formal bids.

Existing law, the Uniform Public Construction Cost Accounting Act, authorizes a public agency which has, by resolution, elected to become subject to uniform construction cost accounting procedures. Existing law provides for the development of cost accounting standards and an alternative method for the bidding of public works projects by public entities. The act defines public project to include, among other things, construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility.

This bill would define public project to additionally include installations involving any publicly owned, leased, or operated facility.

The Uniform Public Construction Cost Accounting Act authorizes public projects of $60,000 or less to be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order, authorizes public projects of $200,000 or less to be let to contract by informal procedures, and requires public projects of more than $200,000 to be let to contract by formal bidding procedures. The act permits the governing body of a public agency, in the event all bids received for the performance of that public project are in excess of $200,000, to award the contract at $212,500 or less to the lowest responsible bidder if it determines the cost estimate of the public agency was reasonable.

This bill would instead authorize public projects of $75,000 or less to be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order, authorize public projects of $220,000 or less to be let to contract by informal procedures, and require public projects of more than $220,000 to be let to contract by formal bidding procedures. The bill would permit the governing body of a public agency, in the event all bids received for the performance of that public project are in excess of $220,000, to award the contract at $235,000 or less to the lowest responsible bidder if it determines the cost estimate of the public agency was reasonable. The bill would also make conforming changes.

The Uniform Public Construction Cost Accounting Act creates the California Uniform Construction Cost Accounting Commission, to fulfill certain duties, including recommending for adoption by the Controller uniform construction cost accounting procedures for implementation by public agencies in the performance of, or in contracting for, construction on public projects. The act requires the commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency falls into specified categories, including that the public agency has exceeded the force account limits. The act also requires the commission to review practices of any participating public agency where an interested party presents evidence that the public agency is not in compliance with requirements to enact a prescribed informal bidding ordinance to govern the selection of contractors to perform public projects.

This bill would additionally require the commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency has been split or separated into smaller work orders or projects, as specified, and would make conforming changes. The bill would also require the commission to review noncompliance with bidding procedures for the publication or posting and electronic transmission of notice inviting formal bids.

Existing law, the Uniform Public Construction Cost Accounting Act, authorizes a public agency, whose governing board has by resolution elected, to become subject to uniform construction cost accounting procedures. Existing law provides for the development of cost accounting standards and an alternative method for the bidding of public works projects by public entities. The act defines public project to include, among other things, construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility.

This bill would define public project to additionally include installations involving any publicly owned, leased, or operated facility.

The Uniform Public Construction Cost Accounting Act authorizes public projects of $60,000 or less to be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order, authorizes public projects of $200,000 or less to be let to contract by informal procedures, and requires public projects of more than $200,000 to be let to contract by formal bidding procedures. The act permits the governing body of a public agency, in the event all bids received for the performance of that public project are in excess of $200,000, to award the contract at $212,500 or less to the lowest responsible bidder if it determines the cost estimate of the public agency was reasonable.

This bill would instead authorize public projects of $70,000 $75,000 or less to be performed by the employees of a public agency by force account, authorize public projects of $100,000 or less to be performed by negotiated contract or by purchase order, account, by negotiated contract, or by purchase order, authorize public projects of $220,000 or less to be let to contract by informal procedures, and require public projects of more than $220,000 to be let to contract by formal bidding procedures. The bill would permit the governing body of a public agency, in the event all bids received for the performance of that public project are in excess of $220,000, to award the contract at $235,000 or less to the lowest responsible bidder if it determines the cost estimate of the public agency was reasonable. The bill would also make conforming changes.

The Uniform Public Construction Cost Accounting Act creates the California Uniform Construction Cost Accounting Commission, to fulfill certain duties, including recommending for adoption by the Controller uniform construction cost accounting procedures for implementation by public agencies in the performance of, or in contracting for, construction on public projects. The act requires the commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency falls into specified categories, including that the public agency has exceeded the force account limits. The act also requires the commission to review practices of any participating public agency where an interested party presents evidence that the public agency is not in compliance with requirements to enact a prescribed informal bidding ordinance to govern the selection of contractors to perform public projects.

This bill would additionally require the commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency has been split or separated into smaller work orders or projects, as specified, and would make conforming changes. The bill would also require the commission to review noncompliance with bidding procedures for the publication or posting and electronic transmission of notice inviting formal bids.

Existing law, the Uniform Public Construction Cost Accounting Act, authorizes a public agency to elect agency, whose governing board has by resolution elected, to become subject to uniform construction cost accounting procedures. Existing law provides for the development of cost accounting standards and an alternative method for the bidding of public works projects by public entities. The act defines public project to include, among other things, construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility.

This bill would make nonsubstantive changes to the title provision of the Uniform Public Construction Cost Accounting Act. define public project to additionally include installations involving any publicly owned, leased, or operated facility.

Existing law, the Uniform Public Construction Cost Accounting Act, authorizes a public agency to elect to become subject to uniform construction cost accounting procedures. Existing law provides for the development of cost accounting standards and an alternative method for the bidding of public works projects by public entities.

This bill would make nonsubstantive changes to the title provision of the Uniform Public Construction Cost Accounting Act.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2192

Author:(Juan Carrillo)

As Amended Ver:August 23, 2024

Majority vote

SUMMARY

Increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (UPCCAA) and refines the oversight authority of the California Uniform Construction Cost Accounting Commission (Commission).

Senate Amendments

1. Remove language that would have separated negotiated contracts and purchase order limits from force account limits for purposes of the UPCCAA.
2. Increase the dollar amount of projects that may be performed pursuant to the UPCCAA by force account, negotiated contract, or purchase order to $75,000 (up from $70,000 in the version of the bill approved by the Assembly).

COMMENTS

The Public Contract Code specifies the procedures that public agencies must follow when they build public works projects, including limits on project costs. The UPCCAA was enacted in 1983 as an alternative to these general requirements by allowing increased bid limits as long as participating agencies follow uniform accounting standards and bidding procedures. A voluntary program that is available to all public entities in the State, the UPCCAA allows public projects costing $60,000 or less to be performed by the public agency's force account, by negotiated contract, or by purchase order. Projects costing $200,000 or less can use informal bidding procedures set forth in the UPCCAA. Projects that cost more than $200,000 must be put out to bid under formal bidding procedures.

The Commission administers the UPCCAA and provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA. The Commission also reviews public complaints and recommends audits when the criteria of the UPCCAA are not fulfilled. In addition, the Commission conducts meetings open to the public, provides a manual for use by public agencies signatory to the UPCCAA and maintains a Commission web page on the Controller's website. Commissioners also facilitate and participate in outreach and training to participating agencies, candidate agencies, and professional organizations.

The UPCCAA requires the Commission to review the Act's force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the Controller promulgates the new limits and the Legislature amends the UPCCAA to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley), Chapter 169, Statutes of 2018.

According to the Author

Recently, the California Uniform Construction Cost Accounting Commission met and unanimously recommended increases to the current California Uniform Public Construction Cost Accounting Act (Act) bidding limits. The Commission unanimously passed a motion to increase the bidding thresholds based on adjustments for inflation and rising construction and project costs. Increasing the bidding limits also furthers the ongoing goal of attracting all public agencies in California that perform public works to voluntarily opt into the Act.

Arguments in Support

The Construction Industry Force Account Council (CIFAC), co-sponsor of this bill, states, "CIFAC is a non-profit coalition of concerned construction industry associations, contractors and labor unions that works to ensure public agency compliance with California laws relating to the construction industry. Ensuring that the Act is updated and provides the right balance of flexibility in construction procurement for agencies vs. the accounting requirements that must be followed once an agency elects to become subject to it, is very important to CIFAC's efforts. As is ensuring that the Commission has the tools to properly enforce and uphold the Act's requirements. AB 2192 advances both of these goals."

Arguments in Opposition

None on file.

FISCAL COMMENTS

According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.

VOTES:

ASM LOCAL GOVERNMENT: 8-0-1

YES: Juan Carrillo, Waldron, Valencia, Kalra, Pacheco, Ramos, Ward, Wilson

ABS, ABST OR NV: Essayli

ASM APPROPRIATIONS: 15-0-0

YES: Wicks, Sanchez, Arambula, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Friedman, Haney, Hart, Jim Patterson, Pellerin, Ta, Villapudua

ASSEMBLY FLOOR: 71-0-9

YES: Aguiar-Curry, Alanis, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Essayli, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Grayson, Haney, Hart, Holden, Hoover, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

ABS, ABST OR NV: Addis, Alvarez, Cervantes, Megan Dahle, Flora, Vince Fong, Gipson, Irwin, Mathis

SENATE FLOOR: 40-0-0

YES: Allen, Alvarado-Gil, Archuleta, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Newman, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

UPDATED

VERSION: August 23, 2024

CONSULTANT: Angela Mapp / L. GOV. / (916) 319-3958 FN: 0004674

 THIRD READING  

Bill No: AB 2192

Author: Juan Carrillo (D)

Amended: 8/23/24 in Senate

Vote: 21

SENATE LOCAL GOVERNMENT COMMITTEE: 7-0, 7/3/24

AYES: Durazo, Seyarto, Dahle, Glazer, Skinner, Wahab, Wiener

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 71-0, 5/16/24 (Consent) - See last page for vote

SUBJECT: Public agencies: cost accounting standards

SOURCE: Construction Industry Force Account Council

DIGEST:

This bill increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (UPCCAA) and separates the negotiated contracts and purchase order limits from the force account limits.

Senate Floor Amendments of 8/23/24 increased the dollar amount of projects that may be performed pursuant to the UPCCAA $60,000 to $75,000 (it was $70,000 in prior version of this bill) and eliminated a new category for negotiated contracts and purchase orders the bill originally sought to create.

ANALYSIS:

Existing law:

1) Establishes the Uniform Public Construction Cost Accounting Act (UPCCAA), which contains the following bid limits that were last updated in 2018:

• 1. Public projects costing $60,000 or less can be performed by the public agency’s force account (the dollar value of labor, materials and equipment at the rate the public agencies charge themselves), by negotiated contract, or by purchase order;
  2. Projects costing $200,000 or less can use informal bidding procedures set forth in the UPCCAA; and
  3. Projects costing more than $200,000 must be put out to bid under formal bidding procedures.

2) Tasks the California Uniform Construction Cost Accounting Commission (Commission) with administering the UPCCAA and providing technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA.

This bill:

1) Makes the following changes to UPCCAA bidding procedures:

• 1. Increases the dollar amount of projects that may be performed pursuant to the UPCCAA by the employees of a public agency by force account, negotiated contracts or purchase order from $60,000 to $75,000;
  2. Increases the cap on the dollar amount of projects subject to the UPCCAA's informal bidding procedures from $200,000 to $220,000; and
  3. Increases the floor of the dollar amount of projects subject to the UPCCAA's formal bidding requirements from $200,000 to $220,000.

2) Requires the Commission to review the accounting procedures of any participating public agency in cases where a person alleges the public agency has violated the UPCCAA by either:

• 1. Splitting or separating the project into smaller work orders or projects to come in under the bid thresholds; or
  2. Exceeding the limits or otherwise not meeting the requirements, for negotiated contracts, purchase orders, and the informal or formal procedures of the UPCCAA.

Background

The Public Contract Code requires public agencies to follow certain procedures when building public works projects and imposes certain cost constraints on those projects.

The UPCCAA is a voluntary program enacted in 1983 and set up an alternative to these general requirements by allowing higher bid limits as long as participating agencies follow uniform accounting standards and bidding procedures.

The Commission administers the UPCCAA and:

• Provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA;
• Reviews public complaints and recommends audits when the criteria of the UPCCAA are not fulfilled;
• Conducts public meetings, provides a manual for use by public agencies, and maintains a web page on the Controller's website; and
• Facilitates and participates in outreach and training to participating agencies, candidate agencies, and professional organizations.

The Commission is required to review the UPCCAA’s force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the Controller sets the new limits and the Legislature amends the UPCCAA to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley, Chapter 169, Statutes of 2018). The Commission on December 8, 2023, passed a motion recommending the Controller increase the UPCCAA bid limits to the amounts contained in this bill.

Comments

1) Purpose of the bill. According to the author, “Recently, the California Uniform Construction Cost Accounting Commission met and unanimously recommended changes to the current California Uniform Public Construction Cost Accounting Act (Act) bidding procedures.

“The Commission unanimously passed a motion to increase the bidding thresholds based on adjustments for inflation and rising construction and project costs. Increasing the bidding limits also furthers the ongoing goal of attracting all public agencies in California that perform public works to voluntarily opt into the Act. Additionally, the bifurcation of bidding limits between negotiated contracts and force accounts will offer quicker project delivery and greater flexibility for member agencies without restricting the use of force accounts where applicable.”

2) Keeping Up With The Jones’. The law requires the Commission to look at increasing the bid levels of the UPCCAA every five years, in part to see if those levels are keeping pace with increased costs.

The bid levels were last adjusted in 2018 and the higher bid levels permitted by this bill come close to keeping up with the overall rate of inflation (which likely underestimates the inflation rate that may be specific to contracting-related costs). Using the overall inflation rate for comparison purposes, $200,000 in 2018 dollars would be just over $248,000 in 2024 dollars, while $60,000 in 2018 dollars would be nearly $75,000 in 2024 dollars.

3) More Oversight = More Accountability. This bill also refines the oversight authority of the UPCCAA Commission by requiring it to examine any public agency when evidence is provided that a project has been split into smaller projects to get under the bid limits in the law or exceeds the dollar thresholds or other requirements for negotiated contracts, purchase orders, and informal or formal procedures.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/24/24)

Construction Industry Force Account Council (source)

Air Conditioning Sheet Metal Association

California Legislative Conference of Plumbing, Heating & Piping Industry

California Special Districts Association

Finishing Contractors Association of Southern California

National Electrical Contractors Association

Northern California Allied Trades

Northern California Floor Covering Association

Southern California Glass Management Association

State Building & Construction Trades Council of California

United Contractors

Wall and Ceiling Alliance

Western Painting and Coating Contractors Association

Western Wall and Ceiling Contractors Association

OPPOSITION: (Verified 8/24/24)

None received

ARGUMENTS IN SUPPORT: According to the Construction Industry Force Account Council (CIFAC):

“CIFAC is a non-profit coalition of concerned construction industry associations, contractors and labor unions that works to ensure public agency compliance with California laws relating to the construction industry. Ensuring that the Act is updated and provides the right balance of flexibility in construction procurement for agencies vs. the accounting requirements that must be followed once an agency elects to become subject to it, is very important to CIFAC’s efforts. As is ensuring that the Commission has the tools to properly enforce and uphold the Act’s requirements. AB 2192 advances both of these goals.”

ASSEMBLY FLOOR: 71-0, 5/16/24

AYES: Aguiar-Curry, Alanis, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Essayli, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Grayson, Haney, Hart, Holden, Hoover, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Addis, Alvarez, Cervantes, Megan Dahle, Flora, Vince Fong, Gipson, Irwin, Mathis

Prepared by: Evan Goldberg / L. GOV. / (916) 651-4119

8/26/24 11:53:15

**** END ****

 THIRD READING  

Bill No: AB 2192

Author: Juan Carrillo (D)

Amended: 3/18/24 in Assembly

Vote: 21

SENATE LOCAL GOVERNMENT COMMITTEE: 7-0, 7/3/24

AYES: Durazo, Seyarto, Dahle, Glazer, Skinner, Wahab, Wiener

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 71-0, 5/16/24 (Consent) - See last page for vote

SUBJECT: Public agencies: cost accounting standards

SOURCE: Construction Industry Force Account Council

DIGEST:

This bill increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (UPCCAA) and separates the negotiated contracts and purchase order limits from the force account limits.

ANALYSIS:

Existing law:

1) Establishes the UPCCAA, which contains the following bid limits that were last updated in 2018:

• 1. Public projects costing $60,000 or less can be performed by the public agency’s force account (the dollar value of labor, materials and equipment at the rate the public agencies charge themselves), by negotiated contract, or by purchase order;
  2. Projects costing $200,000 or less can use informal bidding procedures set forth in the UPCCAA; and
  3. Projects costing more than $200,000 must be put out to bid under formal bidding procedures.

2) Tasks the California Uniform Construction Cost Accounting Commission (Commission) with administering the UPCCAA and providing technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA.

This bill:

1) Makes the following changes to UPCCAA bidding procedures:

• 1. Increases the dollar amount of projects that may be performed pursuant to the UPCCAA by the employees of a public agency by force account order from $60,000 to $70,000;
  2. Creates a new category for negotiated contracts and purchase orders – separating them from the force account limit – and effectively increases the limit for these contracts and orders from $60,000 to $100,000;
  3. Increases the cap on the dollar amount of projects subject to the UPCCAA's informal bidding procedures from $200,000 to $220,000; and
  4. Increases the floor of the dollar amount of projects subject to the UPCCAA's formal bidding requirements from $200,000 to $220,000.

2) Requires the Commission to review the accounting procedures of any participating public agency in cases where a person alleges the public agency has violated the UPCCAA by either:

• 1. Splitting or separating the project into smaller work orders or projects to come in under the bid thresholds; or
  2. Exceeding the limits or otherwise not meeting the requirements, for negotiated contracts, purchase orders, and the informal or formal procedures of the UPCCAA.

Background

The Public Contract Code requires public agencies to follow certain procedures when building public works projects and imposes certain cost constraints on those projects.

The UPCCAA is a voluntary program enacted in 1983 and set up an alternative to these general requirements by allowing higher bid limits as long as participating agencies follow uniform accounting standards and bidding procedures.

The Commission administers the UPCCAA and:

• Provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA;
• Reviews public complaints and recommends audits when the criteria of the UPCCAA are not fulfilled;
• Conducts public meetings, provides a manual for use by public agencies, and maintains a web page on the California State Controller's website; and
• Facilitates and participates in outreach and training to participating agencies, candidate agencies, and professional organizations.

The Commission is required to review the UPCCAA’s force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the California State Controller sets the new limits and the Legislature amends the UPCCAA to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley, Chapter 169, Statutes of 2018). The Commission on December 8, 2023, passed a motion recommending the California State Controller increase the UPCCAA bid limits to the amounts contained in this bill.

Comments

1) Purpose of the bill. According to the author, “Recently, the California Uniform Construction Cost Accounting Commission met and unanimously recommended changes to the current California Uniform Public Construction Cost Accounting Act (Act) bidding procedures.

“The Commission unanimously passed a motion to increase the bidding thresholds based on adjustments for inflation and rising construction and project costs. Increasing the bidding limits also furthers the ongoing goal of attracting all public agencies in California that perform public works to voluntarily opt into the Act. Additionally, the bifurcation of bidding limits between negotiated contracts and force accounts will offer quicker project delivery and greater flexibility for member agencies without restricting the use of force accounts where applicable.”

2) Keeping Up With The Jones’. The law requires the Commission to look at increasing the bid levels of the UPCCAA every five years, in part to see if those levels are keeping pace with increased costs.

The bid levels were last adjusted in 2018 and the higher bid levels permitted by this bill come close to keeping up with the overall rate of inflation (which likely underestimates the inflation rate that may be specific to contracting-related costs). Using the overall inflation rate for comparison purposes, $200,000 in 2018 dollars would be just over $248,000 in 2024 dollars, while $60,000 in 2018 dollars would be nearly $75,000 in 2024 dollars.

3) More Oversight = More Accountability. This bill also refines the oversight authority of the UPCCAA Commission by requiring it to examine any public agency when evidence is provided that a project has been split into smaller projects to get under the bid limits in the law or exceeds the dollar thresholds or other requirements for negotiated contracts, purchase orders, and informal or formal procedures.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/5/24)

Construction Industry Force Account Council (source)

Air Conditioning Sheet Metal Association

California Legislative Conference of Plumbing, Heating & Piping Industry

California Special Districts Association

Finishing Contractors Association of Southern California

National Electrical Contractors Association

Northern California Allied Trades

Northern California Floor Covering Association

Southern California Glass Management Association

State Building & Construction Trades Council of California

United Contractors

Wall and Ceiling Alliance

Western Painting and Coating Contractors Association

Western Wall and Ceiling Contractors Association

OPPOSITION: (Verified 8/5/24)

None received

ARGUMENTS IN SUPPORT: According to the Construction Industry Force Account Council (CIFAC):

“CIFAC is a non-profit coalition of concerned construction industry associations, contractors and labor unions that works to ensure public agency compliance with California laws relating to the construction industry. Ensuring that the Act is updated and provides the right balance of flexibility in construction procurement for agencies vs. the accounting requirements that must be followed once an agency elects to become subject to it, is very important to CIFAC’s efforts. As is ensuring that the Commission has the tools to properly enforce and uphold the Act’s requirements. AB 2192 advances both of these goals.”

ASSEMBLY FLOOR: 71-0, 5/16/24

AYES: Aguiar-Curry, Alanis, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Essayli, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Grayson, Haney, Hart, Holden, Hoover, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Addis, Alvarez, Cervantes, Megan Dahle, Flora, Vince Fong, Gipson, Irwin, Mathis

Prepared by: Evan Goldberg / L. GOV. / (916) 651-4119

8/14/24 16:44:50

**** END ****

 CONSENT  

Bill No: AB 2192

Author: Juan Carrillo (D)

Amended: 3/18/24 in Assembly

Vote: 21

SENATE LOCAL GOVERNMENT COMMITTEE: 7-0, 7/3/24

AYES: Durazo, Seyarto, Dahle, Glazer, Skinner, Wahab, Wiener

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 71-0, 5/16/24 (Consent) - See last page for vote

SUBJECT: Public agencies: cost accounting standards

SOURCE: Construction Industry Force Account Council

DIGEST:

This bill increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (UPCCAA) and separates the negotiated contracts and purchase order limits from the force account limits.

ANALYSIS:

Existing law:

1) Establishes the UPCCAA, which contains the following bid limits that were last updated in 2018:

• 1. Public projects costing $60,000 or less can be performed by the public agency’s force account (the dollar value of labor, materials and equipment at the rate the public agencies charge themselves), by negotiated contract, or by purchase order;
  2. Projects costing $200,000 or less can use informal bidding procedures set forth in the UPCCAA; and
  3. Projects costing more than $200,000 must be put out to bid under formal bidding procedures.

2) Tasks the California Uniform Construction Cost Accounting Commission (Commission) with administering the UPCCAA and providing technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA.

This bill:

1) Makes the following changes to UPCCAA bidding procedures:

• 1. Increases the dollar amount of projects that may be performed pursuant to the UPCCAA by the employees of a public agency by force account order from $60,000 to $70,000;
  2. Creates a new category for negotiated contracts and purchase orders – separating them from the force account limit – and effectively increases the limit for these contracts and orders from $60,000 to $100,000;
  3. Increases the cap on the dollar amount of projects subject to the UPCCAA's informal bidding procedures from $200,000 to $220,000; and
  4. Increases the floor of the dollar amount of projects subject to the UPCCAA's formal bidding requirements from $200,000 to $220,000.

2) Requires the Commission to review the accounting procedures of any participating public agency in cases where a person alleges the public agency has violated the UPCCAA by either:

• 1. Splitting or separating the project into smaller work orders or projects to come in under the bid thresholds; or
  2. Exceeding the limits or otherwise not meeting the requirements, for negotiated contracts, purchase orders, and the informal or formal procedures of the UPCCAA.

Background

The Public Contract Code requires public agencies to follow certain procedures when building public works projects and imposes certain cost constraints on those projects.

The UPCCAA is a voluntary program enacted in 1983 and set up an alternative to these general requirements by allowing higher bid limits as long as participating agencies follow uniform accounting standards and bidding procedures.

The Commission administers the UPCCAA and:

• Provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA;
• Reviews public complaints and recommends audits when the criteria of the UPCCAA are not fulfilled;
• Conducts public meetings, provides a manual for use by public agencies, and maintains a web page on the California State Controller's website; and
• Facilitates and participates in outreach and training to participating agencies, candidate agencies, and professional organizations.

The Commission is required to review the UPCCAA’s force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the California State Controller sets the new limits and the Legislature amends the UPCCAA to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley, Chapter 169, Statutes of 2018). The Commission on December 8, 2023, passed a motion recommending the California State Controller increase the UPCCAA bid limits to the amounts contained in this bill.

Comments

1) Purpose of the bill. According to the author, “Recently, the California Uniform Construction Cost Accounting Commission met and unanimously recommended changes to the current California Uniform Public Construction Cost Accounting Act (Act) bidding procedures.

“The Commission unanimously passed a motion to increase the bidding thresholds based on adjustments for inflation and rising construction and project costs. Increasing the bidding limits also furthers the ongoing goal of attracting all public agencies in California that perform public works to voluntarily opt into the Act. Additionally, the bifurcation of bidding limits between negotiated contracts and force accounts will offer quicker project delivery and greater flexibility for member agencies without restricting the use of force accounts where applicable.”

2) Keeping Up With The Jones’. The law requires the Commission to look at increasing the bid levels of the UPCCAA every five years, in part to see if those levels are keeping pace with increased costs.

The bid levels were last adjusted in 2018 and the higher bid levels permitted by this bill come close to keeping up with the overall rate of inflation (which likely underestimates the inflation rate that may be specific to contracting-related costs). Using the overall inflation rate for comparison purposes, $200,000 in 2018 dollars would be just over $248,000 in 2024 dollars, while $60,000 in 2018 dollars would be nearly $75,000 in 2024 dollars.

3) More Oversight = More Accountability. This bill also refines the oversight authority of the UPCCAA Commission by requiring it to examine any public agency when evidence is provided that a project has been split into smaller projects to get under the bid limits in the law or exceeds the dollar thresholds or other requirements for negotiated contracts, purchase orders, and informal or formal procedures.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/5/24)

Construction Industry Force Account Council (source)

Air Conditioning Sheet Metal Association

California Legislative Conference of Plumbing, Heating & Piping Industry

California Special Districts Association

Finishing Contractors Association of Southern California

National Electrical Contractors Association

Northern California Allied Trades

Northern California Floor Covering Association

Southern California Glass Management Association

State Building & Construction Trades Council of California

United Contractors

Wall and Ceiling Alliance

Western Painting and Coating Contractors Association

Western Wall and Ceiling Contractors Association

OPPOSITION: (Verified 8/5/24)

None received

ARGUMENTS IN SUPPORT: According to the Construction Industry Force Account Council (CIFAC):

“CIFAC is a non-profit coalition of concerned construction industry associations, contractors and labor unions that works to ensure public agency compliance with California laws relating to the construction industry. Ensuring that the Act is updated and provides the right balance of flexibility in construction procurement for agencies vs. the accounting requirements that must be followed once an agency elects to become subject to it, is very important to CIFAC’s efforts. As is ensuring that the Commission has the tools to properly enforce and uphold the Act’s requirements. AB 2192 advances both of these goals.”

ASSEMBLY FLOOR: 71-0, 5/16/24

AYES: Aguiar-Curry, Alanis, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Calderon, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Essayli, Mike Fong, Friedman, Gabriel, Gallagher, Garcia, Grayson, Haney, Hart, Holden, Hoover, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Luz Rivas, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Addis, Alvarez, Cervantes, Megan Dahle, Flora, Vince Fong, Gipson, Irwin, Mathis

Prepared by: Evan Goldberg / L. GOV. / (916) 651-4119

8/7/24 13:38:13

**** END ****

SENATE COMMITTEE ON LOCAL GOVERNMENT

Senator María Elena Durazo, Chair

2023 - 2024 Regular

Public agencies: cost accounting standards

Increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (UPCCAA) and separates the negotiated contracts and purchase order limits from the force account limits.

Background

The Public Contract Code requires public agencies to follow certain procedures when building public works projects and imposes certain cost constraints on those projects.

The Uniform Public Construction Cost Accounting Act (UPCCAA) was a voluntary program enacted in 1983 and set up an alternative to these general requirements by allowing higher bid limits as long as participating agencies follow uniform accounting standards and bidding procedures.

The UPCCAA establishes the following bid limits, which were last updated in 2018:

• Public projects costing $60,000 or less can be performed by the public agency’s force account (the dollar value of labor, materials and equipment at the rate the public agencies charge themselves), by negotiated contract, or by purchase order;
• Projects costing $200,000 or less can use informal bidding procedures set forth in the UPCCAA; and
• Projects costing more than $200,000 must be put out to bid under formal bidding procedures.

The California Uniform Construction Cost Accounting Commission (Commission) is tasked with administering the UPCCAA and provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA. The Commission also reviews public complaints and recommends audits when the criteria of the UPCCAA are not fulfilled. Finally, the Commission conducts public meetings, provides a manual for use by public agencies, and maintains a web page on the Controller's website. Commissioners also facilitate and participate in outreach and training to participating agencies, candidate agencies, and professional organizations.

The Commission is required to review the UPCCAA’s force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the Controller sets the new limits and the Legislature amends the UPCCAA to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley) in 2018. The Commission on December 8, 2023, passed a motion recommending the Controller increase the UPCCAA bid limits to the amounts contained in this bill.

The author would like to implement the recommendation from the UPCCAA Commission to increase the bid limits in current law.

Proposed Law

Assembly Bill 2192 makes the following changes to UPCCAA bidding procedures:

• Increases the dollar amount of projects that may be performed pursuant to the UPCCAA by the employees of a public agency by force account order from $60,000 to $70,000;
• Creates a new category for negotiated contracts and purchase orders – separating them from the force account limit – and effectively increases the limit for these contracts and orders from $60,000 to $100,000;
• Increases the cap on the dollar amount of projects subject to the UPCCAA's informal bidding procedures from $200,000 to $220,000; and
• Increases the floor of the dollar amount of projects subject to the UPCCAA's formal bidding requirements from $200,000 to $220,000.

The bill also requires the Commission to review the accounting procedures of any participating public agency in cases where a person alleges the public agency has violated the UPCCAA by either:

• Splitting or separating the project into smaller work orders or projects to come in under the bid thresholds; or
• Exceeding the limits or otherwise not meeting the requirements, for negotiated contracts, purchase orders, and the informal or formal procedures of the UPCCAA.

Comments

1. Purpose of the bill. According to the author, “Recently, the California Uniform Construction Cost Accounting Commission met and unanimously recommended changes to the current California Uniform Public Construction Cost Accounting Act (Act) bidding procedures.

“The Commission unanimously passed a motion to increase the bidding thresholds based on adjustments for inflation and rising construction and project costs. Increasing the bidding limits also furthers the ongoing goal of attracting all public agencies in California that perform public works to voluntarily opt into the Act. Additionally, the bifurcation of bidding limits between negotiated contracts and force accounts will offer quicker project delivery and greater flexibility for member agencies without restricting the use of force accounts where applicable.”

2. Keeping Up With The Jones’. The law requires the Commission to look at increasing the bid levels of the UPCCAA every five years, in part to see if those levels are keeping pace with increased costs.

The bid levels were last adjusted in 2018 and the higher bid levels permitted by this bill come close to keeping up with the overall rate of inflation (which likely underestimates the inflation rate that may be specific to contracting-related costs). Using the overall inflation rate for comparison purposes, $200,000 in 2018 dollars would be just over $248,000 in 2024 dollars, while $60,000 in 2018 dollars would be nearly $75,000 in 2024 dollars.

3. More Oversight = More Accountability. AB 2192 also refines the oversight authority of the UPCCAA Commission by requiring it to examine any public agency when evidence is provided that a project has been split into smaller projects to get under the bid limits in the law or exceeds the dollar thresholds or other requirements for negotiated contracts, purchase orders, and informal or formal procedures.

Assembly Actions

Assembly Local Government Committee: 8-0

Assembly Appropriations Committee: 15-0

Assembly Floor: 71-0

Support and Opposition

(6/28/24)

Support: Construction Industry Force Account Council, (Sponsor)
Air Conditioning Sheet Metal Association
California Legislative Conference of Plumbing, Heating & Piping Industry
California Special Districts Association
Finishing Contractors Association of Southern California
National Electrical Contractors Association (NECA)
Northern California Allied Trades
Northern California Floor Covering Association
Southern California Glass Management Association (SCGMA)
State Building & Construction Trades Council of California
United Contractors (UCON)
Wall and Ceiling Alliance
Western Painting and Coating Contractors Association
Western Wall and Ceiling Contractors Association (WWCCA)

Opposition: None submitted.

-- END --

Date of Hearing: May 8, 2024

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

ABPCA Bill Id:AB 2192

Author:(Juan Carrillo) – As Amended Ver:March 18, 2024

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (Act) and separates the negotiated contracts and purchase order limits from the force account limits. This bill also refines the oversight authority of the California Uniform Construction Cost Accounting Commission (Commission).

Specifically, this bill:

1. Increases the dollar amount of projects that may be performed pursuant to the Act by the employees of a public agency by force account order from $60,000 to $70,000.
2. Separates the negotiated contracts and purchase order limits from the force account limits while setting the new limit for these procurements at $100,000.
3. Increases the dollar amount of projects that are subject to the Act's informal bidding procedures from $200,000 to $220,000.
4. Increases the dollar amount of projects that are subject to the Act's formal bidding requirements from $200,000 to $220,000.
5. Requires the Commission to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency falls, in addition to existing categories, within any of the following added categories:
   1. Has been split or separated into smaller work orders or projects, in violation of specified existing law.
   2. Has exceeded the limits or otherwise not met the requirements, for negotiated contracts, purchase orders, and the informal or formal procedures of the Act.

FISCAL EFFECT:

Costs to the Commission are minor and absorbable.

COMMENTS:

1. Purpose. According to the author:

The Act was created in 1983 to permit local agencies to use informal bidding procedures for some public works contracts, up to a certain dollar amount and if the local agency uses specified accounting procedures. Every five years, the Commission reviews the current bid limits, and if they recommend adjusting the bid limit, the State Controller may then decide to accept or reject the recommendation. If the Controller accepts the recommendation, it is then up to the Legislature to amend the Act. This bill codifies the Commission’s recommendation from its September, 2017 meeting.

This bill is sponsored by the Construction Industry Force Account Council and the California State Building & Construction Trades Council.

1. Background. The Public Contract Code specifies the procedures that public agencies must follow when they build public works projects, including limits on project costs. The Act was enacted in 1983 as an alternative to these general requirements by allowing increased bid limits as long as participating agencies follow uniform accounting standards and bidding procedures. A voluntary program that is available to all public entities in the state, the Act allows public projects costing $60,000 or less to be performed by the public agency’s force account, by negotiated contract, or by purchase order. Projects costing $200,000 or less can use informal bidding procedures set forth in the Act. Projects that cost more than $200,000 must be put out to bid under formal bidding procedures.

The Commission administers the Act and provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the Act. The Commission also reviews public complaints and recommends audits when the criteria of the Act are not fulfilled.

The Act requires the Commission to review the Act's force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the Controller promulgates the new limits and the Legislature amends the Act to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley), Chapter 169, Statutes of 2018. The Commission, on December 8, 2023, passed a motion recommending the Controller increase the Act bid limits to the amounts contained in this bill.

Analysis Prepared by: Jennifer Swenson / APPR. / (916) 319-2081

Date of Hearing: April 24, 2024

ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT

Juan Carrillo, Chair

ABPCA Bill Id:AB 2192 (

Author:Juan Carrillo) – As Amended Ver:March 18, 2024

SUBJECT: Public agencies: cost accounting standards

SUMMARY: Increases project cost limits specified in the Uniform Public Construction Cost Accounting Act (UPCCAA) and separates the negotiated contracts and purchase order limits from the force account limits. Specifically, this bill:

1. Increases the dollar amount of projects that may be performed pursuant to the UPCCAA by the employees of a public agency by force account order from $60,000 to $70,000.
2. Separates the negotiated contracts and purchase order limits from the force account limits while setting the new limit for these procurements at $100,000;
3. Increases the dollar amount of projects that are subject to the UPCCAA's informal bidding procedures from $200,000 to $220,000.
4. Increases the dollar amount of projects that are subject to the UPCCAA's formal bidding requirements from $200,000 to $220,000.
5. Requires the California Uniform Construction Cost Accounting Commission (Commission) to review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency falls within any of the following added categories in addition to existing categories:
   1. Has been split or separated into smaller work orders or projects, in violation of specified existing law;
   2. Has exceeded the limits or otherwise not met the requirements, for negotiated contracts, purchase orders, and the informal or formal procedures of the UPCCAA.
6. Makes a number of technical, clarifying, and conforming changes.

EXISTING LAW:

1. Establishes the UPCCAA, which is a voluntary program that allows public agencies to perform projects costing $60,000 or less with the public agency’s force account, by negotiated contract, or by purchase order, and to use an informal bidding procedure for projects costing $200,000 or less. Projects costing more than $200,000 are subject to formal bidding procedures. [Public Contract Code (PCC) § 22000-22045]
2. Establishes the Commission to administer the UPCCAA and requires the commission to do all of the following:
   1. Recommend for adoption by the Controller, procedures and standards for the periodic evaluation and adjustment, as necessary, of the monetary limits specified in Section 22032.
   2. The commission shall make an annual report to the Legislature with respect to its activities and operations, together with those recommendations as it deems necessary.
3. Requires the Commission to make recommendations to the State Controller (Controller) every five years regarding adjustments in the UPCCAA's project cost limits. [PCC § 22020]
4. In accordance with procedures and standards adopted pursuant to Section 22017, every five years the commission shall consider whether there have been material changes in public construction costs and make recommendations to the Controller regarding adjustments in the monetary limits prescribed by Section 22032, but in no case shall the amount, as adjusted, be less than fifteen thousand dollars ($15,000). The Controller shall notify all participating public agencies of the adjustment prior to the effective date. That notification shall also describe the provisions of this chapter and the benefits of using its provisions. [PCC § 22020]
5. The commission shall review the accounting procedures of any participating public agency where an interested party presents evidence that the work undertaken by the public agency falls within any of the following categories: [PCC § 22042]
   1. Is to be performed by a public agency after rejection of all bids, claiming work can be done less expensively by the public agency;
   2. Exceeded the force account limits;
   3. Has been improperly classified as maintenance.

FISCAL EFFECT: This bill is keyed fiscal.

COMMENTS:

1. Bill Summary. This bill increases and separates project cost limits specified in the UPCCAA by:
   1. Increasing the dollar amount of projects that may be performed by the employees of a public agency by force account from $60,000 to $70,000;
   2. Separating the negotiated contracts and purchase order limits from the force account limits while setting the new limit at $100,000;
   3. Increasing the informal bidding threshold from $200,000 to $220,000; and,
   4. Increasing the formal bidding threshold from $200,000 to $220,000.

This bill also refines the oversight authority of the Commission by requiring it to review the accounting procedures of any participating public agency when there is evidence of the public project being split or separated into smaller projects in violation of existing law or exceeding the dollar thresholds or other requirements described above for negotiated contracts, purchase orders, and informal or formal procedures.

This bill is sponsored by the Construction Industry Force Account Council and the California State Building & Construction Trades Council.

1. Author's Statement. According to the author, "The UPCCAA was created in 1983 to permit local agencies to use informal bidding procedures for some public works contracts, up to a certain dollar amount and if the local agency uses specified accounting procedures. Every five years, the Commission reviews the current bid limits, and if they recommend adjusting the bid limit, the State Controller may then decide to accept or reject the recommendation. If the Controller accepts the recommendation, it is then up to the Legislature to amend the UPCCAA. This bill codifies the Commission’s recommendation from its September, 2017 meeting."
2. Background. The Public Contract Code specifies the procedures that public agencies must follow when they build public works projects, including limits on project costs. The UPCCAA was enacted in 1983 as an alternative to these general requirements by allowing increased bid limits as long as participating agencies follow uniform accounting standards and bidding procedures. A voluntary program that is available to all public entities in the State, the UPCCAA allows public projects costing $60,000 or less to be performed by the public agency’s force account, by negotiated contract, or by purchase order. Projects costing $200,000 or less can use informal bidding procedures set forth in the UPCCAA. Projects that cost more than $200,000 must be put out to bid under formal bidding procedures.

The Commission administers the UPCCAA and provides technical support to public agencies by prescribing uniform construction cost accounting procedures for agencies that opt into the UPCCAA. The Commission also reviews public complaints and recommends audits when the criteria of the UPCCAA are not fulfilled. In addition, the Commission conducts meetings open to the public, provides a manual for use by public agencies signatory to the UPCCAA and maintains a Commission web page on the Controller's website. Commissioners also facilitate and participate in outreach and training to participating agencies, candidate agencies, and professional organizations.

The UPCCAA requires the Commission to review the Act's force account and bid limits every five years to account for changes in public construction costs. If the Commission recommends higher limits, the Controller promulgates the new limits and the Legislature amends the UPCCAA to reflect the adjusted amounts. This last occurred via AB 2249 (Cooley), Chapter 169, Statutes 2018. The Commission on December 8, 2023, passed a motion recommending that the Controller increase the UPCCAA bid limits to the amounts contained in this bill.

1. Arguments in Support. The State Building and Construction Trades Council, co-sponsor of this measure, states, “The provisions in the bill accurately reflect the Commission’s formal recommendations that were voted on and unanimously passed and then approved by the State Controller. The approved proposal recommended that the limit for which work can be performed directly by a public agency by force account be increased from $60,000 to $70,000 and that the negotiated contract, or purchase order limits should be separated from the force account limit and set at $100,000. And finally, the commission recommended that the current bid limit for public projects of $200,000 or less that can be contracted through the informal procedures of the Act, be increased to $220,000.

“The approved recommendations to increase the limits were based on increased construction costs and the Commission’s ongoing goal to attract all public agencies in California that perform public works to voluntarily opt into the Act by making the Act as appealing as possible. Additionally, the measure includes the Commission’s recommended technical updates to ensure proper oversight and implementation. While the SBCTC advocates primarily for our 450,000 members we understand that the costs of construction have increased since the last legislative effort several years ago and that increases are warranted. However, we also want to make the Act more attractive to join so that our members know that they will be treated fairly on jobs done by public agencies. The extra layer of oversight provided by the Act helps ensure that fewer low-road contractors are employing our members and getting a chance to treat them poorly while also wasting taxpayer dollars.”

1. Arguments in Opposition. None on file.

REGISTERED SUPPORT / OPPOSITION:

Support

Construction Industry Force Account Council (SPONSOR)

State Building & Construction Trades Council of California (SPONSOR)

Air Conditioning Sheet Metal Association

California Legislative Conference of Plumbing, Heating, & Piping Industry

Finishing Contractors Association of Southern California

International Union of Operating Engineers, Cal-Nevada Conference

National Electrical Contractors Association

Northern California Allied Trades

Northern California Floor Covering Association

Southern California Glass Management Association

United Contractors

Wall and Ceiling Alliance

Western Painting and Coating Contractors Association

Western Wall and Ceiling Contractors Association

Opposition

None on file.

Analysis Prepared by: Claire Norton / L. GOV. / (916) 319-3958