Legal Update on Procurement Legislation

Transcription

1 CCFC Regional Workshops Breaking the Mold of Traditional Construction Delivery: Successfully Using Lease-Leaseback and Design-Build Wednesday, May 7, 2014 San Mateo CCD San Mateo, California Legal Update on Procurement Legislation Sherman Wong Public Agency Law Group COMMUNITY COLLEGE FACILITY COALITION 1130 K Street, Suite 210 Sacramento, CA Phone (916) Fax: (916) Handout materials are available online after the workshop. To download the materials, visit and click on the link labeled Workshop Handouts.

2 COAST CCD Friday, May 2, 2014 SAN MATEO CCD Wednesday, May 7, 2014 LEGAL UPDATE Sherman Wong 222 North Sepulveda Boulevard Suite 1690 El Segundo, CA Public Agency Law Group Attorneys at Law Table of Contents AB 173 Community Colleges Small Business & DVBE Purchases Without Bidding Procuring goods, services and information technology Quotes in lieu of bidding Application to Small Business Enterprises and DVBEs Limitations AB 44 Subcontractor Licenses July 1, 2014 Effective Date Subcontractors List; Subcontractor License Consequences of inadvertent license listing AB 630 Right To Use Architect s Instruments of Service No use of Architect instruments of service without architect consent Failure of full payment as reasonable basis for architect denial of consent Effect of AB 630 and Education Code

3 Table of Contents SB 681 Community College Piggyback Purchases Public Contract Code Amendment Clarification of direct contract with vendor and direct payment to vendor under piggyback purchase Garcia v. Bellflower USD Public Records disclosures and liability for attorneys fees Mitigating potential liability AB 1336 Change of time period after project completion for DIR underpayment assessments; increase from 180 days to 18 months Payroll records redaction AB 1734 (Pending) Small Business Participation Goals Small Business/DVBE Bidding Preference Adjustment of DVBE Participation Goal AB 173; Public Contract Code (a) Notwithstanding any other law, including, but not limited to, the advertising, bidding, and protest provisions.but subject to Section , the governing board of a community college district may award a contract for the acquisition of goods, services, or information technology that has an estimated value of greater than five thousand dollars ($5,000), but less than two hundred fifty thousand dollars ($250,000), to a certified small business, including a microbusiness, or to a disabled veteran business enterprise, if the community college district obtains price quotations from two or more certified small businesses, including microbusinesses, or from two or more disabled veteran business enterprises. 2

4 Key Elements of AB 173 Business Enterprise Scope Value Limitations DVBE Small Business Enterprise Microbusiness Goods Services Information Technology Between $5,000 & $250,000 Limited Value Defined Business Enterprises Outsource Classified Staff Functions January 1, 2014 Effective Date Verification of SB/DVBE Status Public Contract Code (a) Certified small business or disabled veteran business enterprise Government Code The department shall have sole responsibility for certifying and determining the eligibility of small businesses and microbusinesses under this chapter. DGS Office Of Small Business & Disabled Veteran Business Enterprise Services ( 3

5 Who Can I Procure From? SMALL BUSINESS Independently owned and operated business notdominantinitsfield Principal office located in California and officers live in California 100 or fewer employees and average annual gross receipts of less than $10,000,000 over the previous three years or a manufacturer with 100 or fewer employees MICROBUSINESS Small business with average annual gross receipts of less than $2,500,000 over the previous three years, or a manufacturer with 25 or fewer employees DVBE Business enterprise with 51% or more ownership by disabled veteran Daily operations managed and controlled by disabled veteran Implementing AB 173 District Policies Board Policy Review Review and Amend Administrative Regulations Quote & Procurement Documents Pre qualify for SBE/DVBE status? Additional Uniform Construction Cost Accounting Category? 4

6 Hidden Minefields HOW MANY QUOTES AND FROM WHOM? from two or more certified small businesses, including microbusinesses, or from two or more disabled veteran business enterprises. COST OF GOODS, SERVICES, INFORMATION TECHNOLOGY SBE/DVBE sale of goods likely to be in capacity as distributor; if goods can be procured from manufacturer, is there premium price procuring from distributor vs. procuring from manufacturer? Actual costs of goods, services or information technology exceeds maximum allowable dollar value Changes cause costs to exceed maximum allowable dollar value ONLY BIDDING AFFECTED Other requirements of public works/public contracts applicable to AB 173 procurements (bonds, prevailing wage rates, etc.) AB 44; Subcontractor s List Public Contract Code 4104 Amendments New Section 4104 provisions effective as of July 1, 2014 This section shall become operative on July 1, Section 4104 inoperative on July 1, 2014, and, as of January 1, 2015, is repealed. 5

7 AB 44; Subcontractor s List; Subcontractor License (a)(1) The name and the location of the place of business, and the California contractor license number of each subcontractor who will perform work or labor or render service to the prime contractor in or about the construction of the work or improvement AB 44; Mistakes in Subcontractor License Numbers An inadvertent error in listing the California contractor license number provided pursuant to paragraph (1) shall not be grounds for filing a bid protest or grounds for considering the bid nonresponsive if the corrected contractor s license number is submitted to the public entity by the prime contractor within 24 hours after the bid opening and provided the corrected contractor s license number corresponds to the submitted name and location for that subcontractor. Requirements for Bidder Correction of Subcontracto r License Number Bidder notice to District within 24 hours of bid opening Corrected number corresponds to listed subcontractor 6

8 AB 44; Modifications to Bid Documents Instructions for Bidders Establish Subcontractor s List disclosure requirements: (i) Subcontractor (ii) Business Location (iii) Subcontractor License Number Establish process for correcting inadvertent listing of subcontractor license number Establish consequences of inadvertent subcontractor license number and failure to comply with process for correcting incorrect subcontractor license number Modify Subcontractors List for disclosure of subcontractor license number Subcontractors List Public Records Act & Attorneys Fees Garcia v. Bellflower USD What Happened District employee mold exposure complaint PRA request for judgments against District and mold complaints District objections to production Action to compel disclosure District ordered to produce judgments and further responses to mold complaints Attorneys fees awarded for action compelling production PRA Responsibilities Production unless exempt Affirmative obligation to assist in identification of documents Suggestions to overcome practical basis for denying access to records 7

9 PRA & Attorneys Fees Government Code Section 6259 Prevailing party entitled to attorneys fee recovery Are litigation results significant justifying attorneys fees recovery? Garcia Holding Action necessary to prompt District to comply with the Public Records Act Significant result; achieved result of litigation AB 630; Using Architect s Instruments of Service Addition of Section to Business & Professions Code Use of architect instruments of services prohibited without architect consent Architect Consent (i) Incorporated into a written contract (ii) Written agreement (iii) Written license specifically authorizing use 8

10 Education Code 17316; Ownership of Design Documents (a) Any contract entered into by and between the governing board of any school district and any certified architect or structural engineer pursuant to Section shall provide that all plans, including, but not limited to, record drawings, specifications, and estimates prepared pursuant thereto, shall be and remain the property of the school district for the purposes of repair, maintenance, renovation, modernization, or other purposes, only as they relate to the project for which the certified architect or structural engineer was retained. (b) The contract set forth in subdivision (a) does not transfer or waive the certified architect's or structural engineer's copyrights over these documents, including, but not limited to, all common law, statutory, and other reserved rights, unless the certified architect or structural engineer expressly transfers or waives these rights through the written contract, including, but not limited to, a written addendum or amendment. Education Code 17316; Re Use of Design Documents (c) Notwithstanding subdivision (a), if the school district proposes to reuse the plans prepared by the certified architect or structural engineer within the school district, the contract entered into between the school district and the certified architect or structural engineer shall specify the terms and conditions for the reuse. If a school district reuses the plans prepared by the certified architect or structural engineer and retains another certified architect or structural engineer for the preparation of those plans for the reuse, the school district shall indemnify and hold harmless the original certified architect or structural engineer, and their consultants, agents, and employees, from and against any claims, damages, losses, and expenses, including attorney's fees, arising out of or resulting from, in whole or in part, the reuse. 9

11 Architect Agreements and Education Code & Business & Professions Incorporate right of District to use Design Documents per B&P Establish that notwithstanding B&P , good faith dispute over payment to architect does not limit right of District to use Design Documents Reference Education Code for District ownership of Design Documents Incorporate provision establishing transfer of intellectual property rights of architect in Design Documents to District. Establish indemnity obligation of District if Design Documents reused SB 681; Community College Districts and Piggybacks Directly With Vendor Public Contract Code Amendment Alternatively, if there is an existing contract between a public corporation or agency and a vendor for the lease or purchase of the personal property, a community college district may authorize the lease or purchase of the personal property directly from the vendor by contract, lease, requisition, or purchase order and make payment to the vendor under the same terms that are available to the public corporation or agency under the contract. 10

12 Effect of SB 681 Clarification of Right to Direct Vendor Piggybacks No Change to Personal Property Limitation Prior authority limited to piggyback purchases through original contracting agency may authorize by contract, lease, requisition, or purchase order, any public corporation or agency, including any county, city, town, or district, to lease dataprocessing equipment, purchase materials, supplies, equipment, automotive vehicles, tractors, and other personal property for the district in the manner in which the public corporation or agency is authorized by law to make the leases or purchases. AB 1336; Amendment to Labor Code 1741; Latest Time for DLSE Prevailing Wage Rate Violation Assessments Extension of Latest Time for DIR Issuance of Prevailing Wage Rate Violation Assessment assessment shall be served not later than 18 months after the filing of a valid notice of completion in the office of the county recorder in each county in which the public work or some part thereof was performed, or not later than 18 months after acceptance of the public work, whichever occurs last. 11

13 AB 1734 (Pending) Small Business & DVBE Participation Goals Government Code % Small Business Participation Goal Military & Veteran Code Amendments Gradually Increased DVBE Participation Goal Government Code Application to Community College Districts This section applies to all state agencies that receive state funding including the California Community Colleges. What triggers 25% Participation Goal? shall only be required to meet the 25 percent goal for state funding used in contracting. 12

14 Military & Veteran Code Increasing DVBE Participation Goal For the fiscal year, not less than 3.5% For the fiscal year, not less than 4% For the fiscal year, not less than 4.5% For the fiscal year and fiscal years thereafter, not less than 5% 13