CIFAC LEGISLATIVE REPORT – 2017 Session Wrap-up

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California Senate Chamber

CIFAC LEGISLATIVE REPORT – 2017 Session Wrap-up

SACRAMENTO – The California Legislature wrapped up the 2017 legislative session on October 15th which was the deadline for Governor Brown to sign or veto legislation.

This year CIFAC championed legislation (AB 1019) to ensure proper funding and staffing for the California Uniform Public Construction Cost Accounting Commission which oversees the California Uniform Public Construction Cost Accounting Act and the public agencies who are subject to it. Unfortunately, despite support for the measure from public agencies and the construction industry, both labor and management, the measure was vetoed by Governor Brown. In his veto message the Governor sited that the State Controller should have the authority to allocate resources to commissions under his office. The veto of AB 1019 was disappointing, we will need to regroup and consult with the State Controller’s Office on next steps to ensure proper staffing of the California Uniform Public Construction Cost Accounting Commission.Eddie Bernacchi, Politico Group

Outside of the veto of AB 1019, CIFAC had another very successful legislative year. The biggest industry win came with the passage of SB 1, securing $5.2 billion annually for state and local transportation infrastructure. The passage of SB 1 positions CIFAC in an important role, to ensure the proper use and contracting out of those new funds.

We also brought home a victory in the area of further limiting the unfair use of lease-leaseback school construction procurement, which should save CIFAC staff time when monitoring and investigating these types of projects.

In addition, and as always, CIFAC took the leading role in defending force account limits.

Enclosed is a list of the key bills CIFAC took positions on in 2017 and the outcome.

LEGISLATION CIFAC SUPPORTED

AB 1019 – California Uniform Public Construction Cost Accounting Act. Commission Funding: Would have guaranteed staffing of the Act’s administrators, the California Uniform Public Construction Cost Accounting Commission, by the State Controller’s Office. This would have ensured that audits of public agencies who are out of compliance with the Act were performed timely.CIFAC Likes icon

Status: Dead – Vetoed by Governor

GOVERNOR'S VETO MESSAGE:

To the Members of the California State Assembly:

I am returning Assembly Bill 1019 without my signature.

This bill requires the State Controller's Office to make staff available to support the California Uniform Construction Cost Accounting Commission.

The need for this bill is unclear. I am confident that the State Controller's Office is more than capable of dedicating the necessary staff to support the Commission and its work without the mandate called for in this bill.

Sincerely,
Edmund G. Brown Jr.

SB 1 - Transportation Funding: In April of 2017, the California State legislature passed and Governor Brown signed into law SB 1, the Road Repair & Accountability Act.

SB 1 will provide approximately $5.2 billion annually for California roads, highways and transit systems. Half the money will be for state transportation and half for local roads. The revenue collection will begin November 2017.

The money will be allocated as follows and totals $52.4 billion: (10-year outlook)

State investment programs (50%)

  • Fix-it-First Highways $15 billion
  • Bridge and Culvert Repair $4 billion
  • Trade Corridor Investments $3 billion
  • Solutions for Congested Commute Corridors $2.5 billion
  • Parks Funding for Ag, Off-Highway Vehicle & Boating $800 million
  • STIP (State Share) $275 million
  • Freeway Service Patrol $250 million
  • California Public Universities Transportation Research $70 million

Local/Regional investment programs (50%)

  • Fix-it-First Local Roads $15 billion
  • Transit Capital and Operations $7.5 billion
  • Local Partnership Funds $2 billion
  • Active Transportation Program Bicycle and Pedestrian Investments $1 billion
  • STIP (Local Share) $825 million
  • Local Planning Grants $250 million

The money will be generated as follows and will total $52.4 billion: (10-year outlook)

  • Fuel Taxes:
  • Gas Excise $24.4 billion
  • Diesel Excise $7.3 billion
  • Diesel Sales $3.5 billion
  • Vehicle-Based Fees:
  • Value-Based Transportation Improvement Fee $16.3 billion
  • Zero Emissions Vehicles (ZEV) Fee Commencing in 2020 $200 million
  • One-Time Repayment of Transportation Loans
  • Repaying Outstanding Loans from the General Fund: $706 million

AB 591 – School Property: Lease: County Boards of Education: Closes a loophole some school districts were using to circumvent recently enacted laws that require that schools using the lease-leaseback project procurement method advertise for bids and establish a competitive selections process for awarding lease-leaseback contracts.

Status: Signed into law

SB 256 – Public Contracts: Criminal Offenses and Statute of Limitations: Would criminalize as misdemeanors certain violations of public contract law dealing with competitive bidding and would allow the commencement of the prosecution of those crimes and other, similar crimes within 3 years from the date of the offense.

Status: Held in Senate Appropriations Committee

SB 634 – Santa Clarita Valley Water Agency: Reorganizes Castaic Lake Water Agency and Newhall County Water District into the Santa Clarita Valley Water Agency and applies the requirements of the Public Contract Code to the new agency.

Status: Signed into law

LEGISLATION CIFAC OPPOSED

AB 636 – Local Streets and Roads: Expenditure Reports: Current law requires each city and county to submit to the Controller a complete report of expenditures for street and road purposes by October 1 of each year relative to the preceding fiscal year ending on June 30. This bill would instead require the report to be submitted to the Controller within 7 months after the close of the fiscal year adopted by a county, city, or city and county.CIFAC Dislikes icon

Status: Held in Senate Rules Committee

AB 1250 – Counties and Cities: Contracts for Services: Establishes specific standards for the use of services contracts by counties and cities. Beginning January 1, 2018, the bill would only allow a county or county agency, or a city or city agency, to contract for services currently or customarily performed by their current employees when specified conditions are met. Among other things, the bill would require the county or city to clearly demonstrate that the proposed contract will result in actual overall costs savings to the county or city and also to show that the contract does not cause the displacement of county or city workers. CIFAC opposed the bill and was able to secure amendments exempting construction, alteration, demolition, installation, repair, or maintenance work from the provisions of the measure.

Status: Held in Senate Appropriations Committee

SB 622 – Transportation District: Contracts: Requires a bridge and highway district to advertise for contracts for all vessel repair, maintenance, and alteration work if the estimated expenditure exceeds $1,000,000, and for all other construction, repair, maintenance, and alteration work, and all similar work, if the estimated expenditure exceeds $5,000, in at least one newspaper and one trade paper of general circulation. CIFAC opposed the bill as originally drafted which would have raised the force account limit on construction, repair and maintenance from $5,000 to $100,000. At our request that provision of the bill was removed.

Status: Signed into law

LEGISLATION CIFAC ACTIVELY MONITORED

AB 618 – Job Order Contracting: Community College Districts: Authorizes community college districts to enter into job order contracts, an alternative construction contracting agreement currently available to school districts, until January 1, 2022.

Status: Signed into law

SB 851 – Local Agency Projects: Extends the sunset date on the authority of counties to use construction manager at-risk contracting, extends construction manager at-risk contracting authority to the City of San Diego, and allows the Santa Clara Valley Water District to use the design-build procurement method.

Status: Signed into law

AB 1424 – University of California: Best Value Construction Contracting Program: Eliminates the sunset on the University of California's authority to use the best value procurement method for construction contracting.

Status: Signed into law


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