May 8, 2009
from Kevin J Pedrotti, Golden State Builders Exchanges Legislative Advocate
Force Account Bill Passes Committee
AB 1409 (John Perez), which is sponsored by CIFAC and supported by the Golden State Builders Exchanges, passed the Assembly Local Government Committee this week after strong opposition from county governments. AB 1409 would delete California Public Contract Code, Section 20395(c), which allows any county that has appointed a registered civil engineer as “road commissioner,” or has abolished that position and instead has appointed a Director of Transportation to perform all work on county highways by force account or day labor. This includes drainage, bridges, culverts and overlays. This section of law has become out-dated and now is being used as a loophole by counties to avoid competitively bidding public work.
The original intent of this law was to allow rural counties that were unable to get contractors to submit competitive bids in their area a method to get paving work completed.
Since the law was originally enacted in 1982 there have been significant changes in the construction industry. Today contractors are more mobile and the production of asphalt can be done by moving mobile plants into an area. As with all other public works, the contractor must meet specifications for materials, perform to established standards and guarantee work for a specified period after the job is complete.
This measure will not affect any county’s current ability to perform new highway construction projects and highway reconstruction projects up to a value of $25,000 or $30,000 if signatory to the California Uniform Construction Cost Accounting Act (CUCCAC) by force account or day labor.
The bill will be heard by the Assembly Transportation Committee next week.
Blakeslee, new Assembly Republican Leader
Saying it is time for new leadership, Assemblyman Mike Villines (R- Clovis) announced his resignation Thursday as head of the house's GOP caucus, effective June 1.The Republican Caucus was expected to vote Thursday morning on Villines' replacement, expected to be Sam Blakeslee of San Luis Obispo. Villines, who will be termed out of the Assembly next year, said he expects to continue a career in public service and is a probable candidate for Insurance Commissioner next year.
Legislative Analists Office Reports:
California’s Cash Flow Crisis: May 2009 Update
May 7, 2009, Full Report: HTML PDF
In part because state revenue collections have been weaker than expected since passage of the February budget package, major cash flow difficulties loom for California in the summer and fall of 2009. Without significant budget-balancing and cash management actions by the Legislature or unprecedented borrowing from the short-term credit markets, the state will not be able to pay many of its bills on time for much of 2009-10. Returning the budget to balance will be important to resolving the state's cash flow challenges. We recommend that the Legislature act quickly to address these challenges—by late June or early July at the latest. We also note that the state should be cautious about accepting additional federal assistance for the state's cash flow problems, especially given the strings that may be attached to such aid. (Five-minute video summary)
You will recall, earlier this year, construction projects were threatened because the state had no cash on hand to pay contracts. A similar situation is being threatened before mid-year.
AB 1523 set for hearing on May 18th
AB 1523 will be heard in the Assembly Revenue and Taxation Committee on May 18th. AB 1523 is legislation to not apply the recent sales tax increase to fixed priced contracts entered into before April 1, 2009.
Below is a link to the Board of Equalization web site that answers frequently ask questions about the sales tax increase.
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