Author Archives: CIFAC Staff

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Water Dripping City of Stockton Story

The Importance of Contractor Licensing Laws

Category:Around The State News
By Michelle Tucker, Executive Director

Anyone who works within the public works construction industry knows the importance of the contractor licensing laws in California. Our State has some of the strictest rules in the nation, sometimes causing confusion and headaches while navigating through the bid and award process.

Although the annoyance factor is understandable, did you know that these laws might also be used to your advantage in certain circumstances.

Before we delve into how they may be used, let me quickly summarize the reasons behind them. Per State law, anyone in California who contracts to perform work on a project that is valued at $500 or more, including labor and material, must hold a current, valid license from the Contractors State License Board (CSLB). The CSLB provides licensure in contractor classifications (A) General Engineering Contractors, (B) General Building Contractors and (C) Specialty Contractors. The purpose of the law is to protect the public from incompetence, negligence and dishonesty in those who provide construction services and to safeguard the public against unskilled workmanship and deception.Michelle Tucker, Executive Director

The Contractor's State License Board is the state agency responsible for administering these license laws, which include reviewing and investigating complaints made against contractors and administering disciplinary action against contractors found to have violated any aspect of the licensing provisions.

With this knowledge, let us move on. Agencies are responsible for specifying the classification of contractor’s license required to perform work on a specific public project in their bid solicitations and ensure only appropriately licensed contractors are awarded the construction contract.

In recent cases, I’ve seen agencies request an incorrect classification and award contracts to improperly licensed firms.

For example, I was contacted regarding a $600,000 plumbing contract requiring a C-36 licensure but awarded to a contractor with an A license only. I was asked if the A licensure can perform the work and what ramifications if any, would apply. The agency required a C-36 license in the bid documents. Several C-36 licensures submitted bids, along with one A licensure. The agency awarded the contract to the A licensure and work commenced.Plumber Plumbing City of Stockton Story

It is important to note that the scope of work required no engineering or specialty work that typically would be performed by an A licensed contractor. The contractor was working outside of their classification, which subjected them to penalties imposed by the Contractors State License Board. The agency failed to do due diligence during the review of bids, as the licensing error should have been caught with the contractor being deemed non-responsive. In this case, I met with the agency staff to report the violation and request that all work stop immediately, with the project going to a rebid.

Among the obvious, I explained that the A licensure was afforded a bidder’s advantage as no other A licensed contractor was allowed to bid the work. A level playing field is crucial in our industry. If you are a contractor, I am sure this scenario would anger you if your work were taken away by another contractor who cannot legally perform it. If you are an agency, you want to ensure that the contracting party has the knowledge, experience and expertise to perform your project correctly.

I hope that you can now put two and two together. For contractors and industry agents, when reviewing bid results, make sure you check the license classifications of the low bid contractors who submitted bids and the subcontractors listed for each portion of work. If you see a discrepancy in the licensing of other bidders, you should bring that to the attention of the agency and the CSLB. It may benefit you if your firm is awarded the contract!City Of Stockton Logo City of Stockton Story

If you are wondering what the outcome was with the agency that awarded the contract to the A contractor; they agreed to stop the work and rebid the contract. The contractor was reported to the CSLB, who is currently reviewing the case. The end result is that $600,000 worth of work will be available for appropriately licensed contractors!

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Bridging the Gap Without the App

Category:Around The State News
By Patricia Rascon, Southwestern Regional Compliance Manager

For the first time in history our workforce is comprised of five different generations. The three main groups are Baby Boomers born 1946-1964, Generation X born 1965-1980, and Generation Y born between 1981-1995. Add in some of the Traditional generation born before 1945 and the now emerging Linkster’s born after 1995, and the question arises… how do we merge the generations in the workplace and create a cohesive team environment?

Recently this topic came up while talking with “Steve”, a forty-five-year member of our industry. I was telling him about CIFAC’s new Contract Compliance software that gives us Compliance Managers the ability to create and track our investigations, upload photos, write letters and reports. Essentially, we can work from anywhere! He then reminisced about rotary phones, electric typewriters; carbon paper and Xerox reproduction machines the size of a double deep freezer! Tenured employees were of the culture that communication was done through regular meetings, letters, formal memos, and phone calls. In summary, he said, “Boomers had to learn things the hard way. In addition, they had to memorize what they learned. Generation X, Y rely on the internet to get information. However, the internet has just information; it does not tell you how to communicate. Communication is rational”. Fast forward to cellphones, computers, tablets, and the like, that provide us with the ability to take our office on location rather than shuttling between the two.Patricia (Patti) Rascon, Southern Regional Compliance Manager

While merging technology with tradition and experience, we can bridge the gap and complement each generation by striving to create a diverse team. Utilizing the strengths of all can build strong relationships. In their book Generations, Inc. Meagan and Larry Johnson write about a common practice among Japanese companies where they pair a seasoned mentor “Sempai” with a younger mentee “Kohai”. In addition to the Sempai’s managerial duties, his/her job is to help the Kohai succeed in all areas to include technical and operational questions and organizational politics. The book reminds us to capture Boomers knowledge so all is not lost when retirement calls. On the other end of the spectrum, Generation Y appears to seek balance, not necessarily a nine-to-five workday, but setting their own hours. They understand technology is rapidly changing and they are very interested in continual skill development. They want to contribute right away and stability comes from the ability to balance work and life goals, opportunities for learning and belief that they are supporting company goals.

The one size fits all approach doesn’t work, to manage effectively means we must adjust and be flexible. To sum it up… “Life is rather like a tin of sardines-we’re all of us looking for the key”
-Alan Bennett, British author, actor, humorist, and playwright

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The Brown Act – Impacts Two Cities

Category:Around The State News
By Patricia Rascon, Southwestern Regional Compliance Manager

CIFAC Educates Two Cities on Agenda Posting Requirements

(January 2017) What is transparency? Ballotpedia refers to it as, “Openness, accountability, and honesty define government transparency. In a free society, transparency is government’s obligation to share information with citizens. It is at the heart of how citizens hold their public officials accountable. Governments exist to serve the people. Information on how officials conduct the public business and spend taxpayers’ money must be readily available and easily understood. This transparency allows good and just governance”.

Recently while reviewing City Council agendas for two cities in Kern County, I discovered that they were neglecting to post the agendas on their City Internet websites. Through my research, it appeared that the “sites” were marginally operational with postings of employment openings, calendar of events and public hearings for example, but the agendas were nonexistent.Patricia (Patti) Rascon, Southern Regional Compliance Manager

The Ralph M. Brown Act found in California Government Code §54944.2 (a) (1), focuses on the required agenda postings of at least 72 hours before the regular meeting in a location that is “freely accessible to members of the public”. While the courts have not conclusively defined the term “freely accessible”, the California Attorney General has interpreted the provision to require posting in a location accessible to the public 24 hours a day for a 72-hour period. Additionally, the agenda is to be posted to the City Internet website if they have one.

Are there consequences if the City does not abide by the provision of the code with respects to posting on the Internet site? I was surprised to learn that the answer could potentially be “yes”. The Brown Act cites that there should be “substantial compliance” with all agenda posting requirements which includes posting to the agency website §54960 (d) (1). Technical difficulties in of themselves do not automatically require cancellation of the meeting providing the “agency” is complying with all the other requirements of The Brown Act.

The outcome of my inquiry and subsequent education on The Brown Act requirements resulted in the posting of the current agenda and assurance that they are working to correct the technical issues with their respective sites. All cities have a duty to provide its citizens and the general public with an Internet site that is not only accessible with up-to-date content, but other benefits such as digital amenities to request services, contact staff and make comments, and be a resource in general. Furthermore, and most importantly to have a plan to correct outages and errors quickly.

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Lease Leaseback: This Foe May Be A New Friend

Category:Around The State News
By Michelle Tucker, Executive Director

A new law brings fairness to “lease leaseback” contracting. For many compliance agents and contractors in California, the mere mention of a “lease leaseback” school construction project spurred verbal groans and eyeball rolls. The negative perception surrounding this contracting method was in large part due to school districts abusing its use to circumvent the Public Contract Code competitive bidding statutes via a California Education Code exemption.

For more than sixty years, districts were allowed to lease school property to a developer for a dollar annually and allow the developer to construct and modernize facilities, which the school would regain ownership upon completion. This may not sound like a bad deal initially, until you find out that there was no advertising of the project, no transparency, no price competition, no subcontractor protections………. Need I go on? For the few contractors getting these jobs, that may not be a problem. But in the big picture it means most contractors were left in the dark about the upcoming projects. Not to mention the fact that our economy is based on free enterprise and competition. The whole basis of the Public Contract Code is to ensure a level playing field for contractors, stimulate price competition through bidding, require transparency that prevents favoritism, fraud or corruption in the awarding of contracts and as a protection to the public against misuse of public funds.Michelle Tucker, Executive Director

Let’s fast forward to Jan. 1, 2017. CIFAC partners carried assembly bill 2316, with collaboration from Michelle Tucker, CIFAC’s Central Regional Compliance Manager, which amended the Education Code to now require a competitive solicitation process should a district choose to use this contracting method. This process now includes the adoption and publishing of required procedures and guidelines by the school district, the advertisement of a Request for Proposal, prequalification of contractors, proposals to be submitted in a sealed envelope, with each proposal scored based on a best value system, and finally, subcontractor protections must be built into the contract.

This is a true win-win situation for the Industry and the public. This legislation created an improved method of procurement that is both fair and impartial. CIFAC and partners are committed to holding agencies accountable for their actions and working to increase job opportunities for the Industry.

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Do California Fairs Follow Public Contract Code?

Category:Around The State News

California’s fairs can be difficult navigate. What are the force account limits? Do all the fairs have to follow the same rules? What’s the difference between a state owned fair and a county owned fair? Many of the answers are cut and dry, while some are in a grey area.

In 2012, California’s budget shortfalls meant fairs didn’t receive any public funds to maintain facilities, build new facilities, or run day-to-day operations. This decision came on the heels of a 2009 decision to take the money fairs received from horse racing license fees, and put the money in the general fund. In 2016, all that changed. California began giving the fair districts money again, but many new CEOs are unaware they have to follow the public contract code.

There are 77 fairs overseen by the California Department of Agriculture’s Fair and Expositions Division. Amongst those 77 fairs are 54 District Agricultural Associations that are part of the state of California’s fair network. The other fairs are considered county owned.

A county with a fair that is a District Agricultural Association has a force account limit of $25,000. Once a project exceeds that limit, it must be put out to bid. From there, everything follows public contract code.

For county owned fairs, things are different. They still have to follow public contract code, but it depends on the organization that the county has contracted to run the fairgrounds for them. Many of these county owned fairs use a non-profit fair association to handle the day to day operations and any construction projects. If the non-profit runs everything, then it doesn’t matter if they received public funds because the non-profits are exempted from following public contract code.

The county could have language in the agreement with the fair board on when a project needs to be sent out to bid, but it becomes difficult to enforce certain areas of the public contract code when it’s a non-profit agency. As always, if you feel any agency isn’t in compliance with public contract code, feel free to reach out to a compliance manager with CIFAC.