Legislature Ends 2011 Session… - Associated General Contractors ...


Legislature Ends 2011 Session… - Associated General Contractors ...

Associated GeneralContractors (AGC)The California ChaptersLegislature Ends 2011 Session…Governor has 30 days to actAt about 1:00 am in the morning on September 10, the Legislatureadjourned for the year and scheduled to return to Sacramento onJanuary 4, 2012 to begin the second year of the 2011-2012 legislativesession. Hundreds of bills were sent to the Governor who has untilOctober 9 to either sign or veto the measures.This was a year of winners and losers. AGC won and lost some as wesaw an aggressive agenda pushed by public and private sector unioninterests. The legislature weighed issues such as encouraging projectlabor agreements, creating roadblocks for construction of big-box stores,shutting down landfill and quarry projects (that happen to involve AGCmembers) and imposing additional labor sanctions on employers - all thewhile, touting the need to improve the economy and create jobs.The state budget, pieced together with bailing wire and duct tape back inJune, is already beginning to unravel. To no one’s surprise, staterevenues are falling short of projections and it is likely that automaticbudget cuts may occur as of January 1. There are already calls for theGovernor to call a special session on the budget.There was some good news though as approval of the budget meant gastax revenues continued to flow to Caltrans, so progress payments couldbe paid to contractors. Without a budget in place, the state Controllerwould have been prohibited from transferring gas tax monies into theState Highway Account and projects were in danger of being shut down.Below is a summary of this year’s legislative session:Priority Legislation on the Governor’s desk……Legislative Advocates:David AckermanPaul GladfeltyJamie Khan1201 K StreetSuite 750Sacramento, CA 95814(916) 444-9601(916) 444-7841 FaxSponsored/Co-Sponsored LegislationSB 293 (Padilla) Payment Bonds Claims – Protects contractorsagainst “late” payment bond claims by limiting the time during which aclaim can be filed. (Sponsor) Pending Governor’s Action

2011 Legislative SummaryPage 2AB 720 (Hall) Public Contracts: Uniform Construction Cost AccountingProvisions: Alternative Procedures – Limits the use of “force account” authority bycounty road commissioners. (Co-sponsor) Pending Governor’s actionAB 943 (Williams) Public contracts – Provides that if public agencies voluntarily electto become subject to uniform construction cost accounting procedures, projects of$175,000 or less may be let by contract by informal procedures. If all of the informalbids received are in excess of $125,000, the governing board of the public agency mayadopt a resolution, by a 4/5 vote, to award the contract at $187,500 or less to the lowestresponsible bidder. (Co-Sponsor) Signed by the Governor.Bills Already Signed or Vetoed…SB 104 (Steinberg) Labor Representatives: Elections – Would have permittedagricultural employees, as an alternative procedure, to select their labor representativesby submitting a petition to the board accompanied by representation cards signed by amajority of the bargaining unit. (Oppose, veto requested) Vetoed by the Governor.SB 341 (Lowenthal) Vehicles: Dump Trucks: Backup Alarms – Requires acommercial vehicle in excess of 14,000 pounds that transports any construction orindustrial material to and from a mine or construction site, or both, to be equipped withan automatic backup audible alarm. (Support, signature requested) Signed into law bythe Governor.SB 724 (Dutton) Air Resources Board – Requires the California Air Resources Boardwithin 30 days of an application being filed for approval of a new or renewal enginepermit, to inform the applicant that the application is complete. (Support, signaturerequested) Vetoed by the GovernorAJR 5 (Lowenthal, Bonnie) Transportation Revenues – Requests the President andthe Congress of the United States to consider and enact legislation to conduct a studyregarding the feasibility of the collection process for a transportation revenue sourcebased on vehicle miles traveled. (Support) Enacted - Resolution Chapter 29.AB 240 (Bonilla) Compensation Recovery Actions: Liquidated Damages – Permitsan employee to recover liquidated damages pursuant to a complaint brought before theLabor Commissioner alleging payment of less than the minimum wage fixed by an orderof the Industrial Welfare Commission or by statute. (Oppose) Signed by the Governor.SB 111 (Yee) English Language – Makes it a violation of the Unruh Civil Rights Act toadopt or enforce a policy that requires, limits or prohibits the use of any language in abusiness establishment, unless the policy is justified by a business necessity. (Oppose)Vetoed by the Governor.

2011 Legislative SummaryPage 3Priority Legislation – Governor’s Signature RequestedSB 835 (Wolk) – Best Value Contracting: University of California – Expands the“best value” pilot project approved for the University of California San Francisco campusto UC system-wide application and sunset the new pilot program in 2017. As part of thelegislative agreement with AGC, the University has agreed to modify and expedite theirchange order process to reduce claims and pay more promptly. (Support as amended,Governor’s signature requested).SB 468 (Kehoe) Department of Transportation: San Diego North Coast CorridorProject – Imposes requirements on Caltrans to insure that there is adequate publictransit available prior to proceeding with proposed capacity-increasing state highwayprojects in the coastal zone. AGC strongly opposed SB 468 as introduced and workedwith the San Diego Association of Governments and Senator Kehoe to reach acompromise that will allow highway and transit construction to proceed as planned. Thebill was amended in the Senate to apply only to San Diego County. (Support asamended, Governor’s signature requested)AB 1330 (Furutani) Career Tech Education – With the 2012-13 school year, addscompletion of a course in career technical education as an alternative to therequirement that a pupil complete a course in visual or performing arts or foreignlanguage. (Support, Governor’s signature requested)AB 892 (Carter) Caltrans – Extends the sunset date for a surface transportation projectdelivery pilot program, under which California assumed responsibilities forenvironmental review and clearance of transportation projects that, would otherwisehave been the responsibility of the federal government. (Support, Governor’s signaturerequested)AB 1210 (Garrick) Stormwater plans – civil engineers – Provides that a registeredcivil engineer is qualified to prepare storm-water plans. (Support as amended,Governor’s signature requested)AB 1150 (V. Manuel Pérez) Self-Generation Incentive Program – Extends the sunseton the Public Utility Commission's (PUC's) Self-Generation Incentive Program (SGIP)for one year (through 2012) to permit the extension of incentivizing development ofdistributive on-site renewable energy facilities. (Support, Governor’s signaturerequested).AB 397 (Monning) Workers' Compensation Insurance: Contractors – Requires, atthe time of renewal, an active contractor licensee with an exemption for workers'compensation insurance on file with the board, to either recertify the licensee'sexemption or to provide a current and valid Certificate of Workers' CompensationInsurance or Certificate of Self-Insurance. (Support, Governor’s signature requested)

2011 Legislative SummaryPage 4AB 878 (Berryhill, Bill) Contractors: Workers' Compensation Insurance – Requiresa workers' compensation insurer to report to the registrar of the Contractors StateLicense Board, a licensee whose workers' compensation insurance policy is cancelled.(Support, Governor’s signature requested)Priority Legislation – Governor’s Veto RequestedAB 436 (Solorio) Labor Compliance - Project Labor Agreements - Exempts schooldistricts and other local public agencies from reimbursing the Department of IndustrialRelations for labor compliance costs if the school district enters into a project laboragreement. (Oppose) AGC is requesting a veto.SB 922 (Steinberg & Perez) Project Labor Agreements – Prohibits state constructionfunding for local agencies that by ordinance or charter amendment prohibit project laboragreements. (Oppose) AGC is requesting a veto.SB 474 (Evans) Commercial Construction Contracts: Indemnity – Prohibits aGeneral Contractors from requiring a subcontractor to obtain indemnity agreements orinsure for a general contractors ”active negligence”. Although AGC recognizes thatthere is a need to develop a compromise in this area of liability law, there was no finalagreement on the bills provisions, and as a result the bill contains several problems thatwill result in increased litigation instead of creating a greater balance between generalsand their subcontractors. AGC will ask for a veto, requesting that the parties go backinto negotiations to fix a flawed legislative proposal.SB 459 (Corbett) Independent Contractors – Prohibits willful misclassification ofemployees as independent contractors. (Oppose) AGC is requesting a veto.SB 931 (Evans) Payroll Cards – Prohibits the issuers or employers from charging anyfees to employees regardless of the number of transactions. (Oppose) AGC isrequesting a veto.SB 469 (Vargas) Big Box Superstores – Requires an applicant to a local governmentfor a permit to develop a big-box superstore to submit an economic and communityimpact analysis report prior to the review of the permit application. (Oppose) AGC isrequesting a veto.SB 833 (Vargas) Gregory Canyon Landfill – Prohibits the construction of the GregoryCanyon Landfill in San Diego County. (Oppose) AGC is requesting a veto.AB 469 (Swanson) Employees: Wages – Makes it a misdemeanor if an employerwillfully fails to pay a final court judgment or final order from the Labor Commissioner forwages due. (Oppose) AGC is requesting a veto.

2011 Legislative SummaryPage 5AB 22 (Mendoza) Credit Reports – Prohibits an employer from obtaining a consumercredit report for employment purposes unless the information is substantially jobrelated.(Oppose) AGC is requesting a veto.AB 325 (Loewnthal, Bonnie) Bereavement Leave – prohibits an employer fromrefusing to grant a request by any employee to take up to 3 days of bereavement leaveor to interfere with or restrain an employee from doing so. This bill would authorize anemployee who has been discharged, disciplined, or discriminated against for exercisinghis or her right to bereavement leave to bring a civil action against his or her employerfor reinstatement, specified damages, and attorney's fees. (Oppose) AGC is requestinga veto.Other Priority Legislation before the GovernorAB 514 (Hernández, Roger) Public Works: Prevailing Wage: Hauling Refuse –Requires the payment of prevailing wages for the hauling of materials other than bonafide commodities sold at fair market value. (Position pending)AB 900 (Buchanan & Steinberg) – CEQA Process - Allows for an expedited projectapproval process under the California Environmental Quality Act. Only projects payingprevailing wage would be eligible. (Opposed based on the prevailing wage provisions).AB 1424 ( Perea) Franchise Tax Board: Delinquent Tax Debt – Allows FTB tosuspend licenses of the 500 worst tax offenders for nonpayment of tax obligations.AGC was able to convince the author to exempt out the construction industry since theCSLB already has a process in place to allow them to suspend a license if there is afinal judgment against a license holder. (Neutral)AB 551 (Campos) Public Contracts: Prevailing Wage Requirements: Violations –Increases that maximum penalty for willful prevailing wage violations from $50 to $100for each calendar day and would increase the minimum penalty from $10 to no lessthan $40 for each calendar day. The bill would also increase the penalty assessed tocontractors and subcontractors with prior violations from $20 to $80, and from $30 to$120 for willful violations. (Watch)SB 56 (Corbett) Apprenticeship Council – Provides that no two employeerepresentatives on the California Apprenticeship Council may be from the same nationalor international labor organization. (Neutral)

2011 Legislative SummaryPage 6Bills that failed passage or were held in committee... These bills and/orissues are two year bills and may be on next year’s agenda...SB 791 (Steinberg) – Transit financing – Would allow regional government agenciesto impose a “gas fee” to fund transit and other transportation projects at the local level.(Watch) Pending amendments in the Senate – Two year bill.SB 475 (Wright) Public Private Partnerships – Clarifies the procedures for localagencies to enter into public private partnership projects (P3) and allow theP3 agreements to be for a term of up to 50 years. (Support) Failed passage inAssembly Local Government Committee due to opposition from public sector unionsand the State Building Trades. Reconsideration granted so the bill may be heard incommittee again.SB 600 (Rubio) Prequalification – Requires school districts to use one of two optionsto prequalify contractors. (Support if Amended)Held in the Assembly AppropriationsCommittee.AB 296 (Skinner) Cool Pavement Specifications – Would enact legislation that wouldregulate the reflectivity of pavement to reduce the urban heat island effect. AGCopposed original version of the bill based on cost concerns to Caltrans. The authoramended the bill to remove the mandate requiring future use of the product on 75% ofall paving areas and AGC removed opposition. (Oppose unless amended) Held inAppropriations Committee.AB 294 (Portantino) Caltrans Design Sequencing – Extends Caltrans designsequencingprocurement authority. Amendments and opposition to the bill to attempt tooverride the court judgment concerning P3 on Doyle Drive resulted in the bill being heldin the Senate. (Oppose as proposed to be amended) Held in SenateSB 120 (Anderson) State Funds: Registered Warrants – Requires a state agency toaccept a registered warrant issued by the Controller that is endorsed by that payee, atfull face value, for the payment of any obligations owed by that payee to that stateagency. (Support) Held in Appropriations Committee.SB 829 (DeSaulnier) CalOSHA Appeals Board – Revises various provisionsregarding citations issued by CalOSHA; the persons or entities that are authorized toparticipate as a party in an appeal before the appeals board; and the procedures thatgovern the appeals board in hearing and deciding appeals. (Oppose) Pending inAssembly Appropriations Committee.AB 197 (Monning) Recovery of Wages: Liquidated Damages – Increases theamount of liquidated damages that may be awarded to an employee to twice the

2011 Legislative SummaryPage 7amount of the minimum wages unlawfully unpaid, plus interest. (Oppose) Pending inAssembly.AB 1308 (Miller) Highway Account: Appropriation of Funds – Would in any year inwhich the Budget Act has not been enacted by July 1, provide that all moneys in theHighway Users Tax Account in the Transportation Tax Fund are continuouslyappropriated and may be encumbered until the Budget Act is enacted. This wouldensure that highway contractors will be paid for current work in the event of a budgetimpasse. AGC was in strong support. Meetings in support were held with the Speaker ofthe Assembly and Chair of the Appropriations Committee. However, the bill was held inthe Appropriations Committee. AGC and the construction industry have twice sponsoredsimilar legislation in two pervious legislative sessions with the same result. (Support –Co-Sponsor) Held in Appropriations Committee.SB 883 (Correa) Employers: Good Faith Defense – Permits an employer to raise asan affirmative defense that, at the time of an alleged violation, the employer was actingin good faith and in compliance with or reliance upon an applicable employment statuteor regulation. (Support) Held in Labor Committee.SBX1 23 (Committee on Budget and Fiscal Review)(was SB 653Steinberg) Authorization for Local Taxation – Authorizes the governing board of anycounty or city and county, any school district, any community college district and anycounty office of education subject to constitutional and voter approval requirements, tolevy, increase or extend a local personal income tax, transactions and use tax, vehiclelicense fee and excise tax, including, but not limited to, an alcoholic beverages tax, acigarette and tobacco products tax, a sweetened beverage tax, and an oil severancetax. (Oppose) Pending action in Senate – two year bill.AB 780 (Calderon, Charles) Sales Tax on Fixed Price Contracts – Requires publicagencies to reimburse contractors who entered into fixed price contracts prior toenactment of an increase in the state sales tax. (Sponsor) Held in SenateAppropriations Committee.SB 907 (Evans) Infrastructure Development – Creates the Master Plan forInfrastructure Financing and Development Commission. (Support) Held in AssemblyAppropriations CommitteeSB 129 (Leno) Medical Marijuana – Authorizes a person who has suffereddiscrimination from the legal use of medical marijuana to institute and prosecute a civilaction for damages. (Oppose) (As a result of opposition from the business community,including AGC, the author declined to take the bill up in the Senate for a vote.)AB 448 (Ammiano) Property Taxation: Change in Ownership – Allows for a splitproperty tax roll to allow commercial property to be reassessed for tax purposes.(Oppose) (Author cancelled committee hearing.)AB 10 (Alejo) Minimum Wage: Annual Adjustment – Increases the minimum wage,

2011 Legislative SummaryPage 8as of January 1, 2012, to not less than $8.50 per hour. (Oppose) Held in AppropriationsCommittee.AB 59 (Swanson) Family and Medical Leave – Increases the circumstances underwhich an employee is entitled to protected leave by (1) eliminating the age anddependency elements from the definition of "child," thereby permitting an employee totake protected leave to care for his or her independent adult child suffering from aserious health condition, (2) expanding the definition of "parent" to include anemployee's parent-in-law, and (3) permitting an employee to also take leave to care fora seriously ill grandparent, sibling, grandchild, or domestic partner. (Oppose) Held inAppropriations Committee.AB 150 (Perea) Public Contracts: Small Business and Disabled Veteran BusinessEnterprise Participation – Authorizes the Department of General Services to direct allstate agencies, departments, boards, and commissions to establish the goal to achievenot less than 25% participation by small businesses and, to the extent permitted by law,not less than 5% women's business enterprise participation, 15% minority businessenterprises participation, and 3% disabled veteran business enterprise participation instate procurements and contracts. (Oppose) Held in Appropriations Committee.AB 400 (Ma) Employment: Paid Sick Days – Provides that an employee who works inCalifornia for 7 or more days in a calendar year is entitled to paid sick days which shallbe accrued at a rate of no less than one hour for every 30 hours worked. An employeewould be entitled to use accrued sick days beginning on the 90th calendar day ofemployment. (Oppose) Held in Appropriations Committee.AB 553 (Monning) Employment Safety: Hazardous Materials – Declares the findingsof the Legislature regarding the rights of workers to be protected from exposure tohazardous substances and toxic materials in the workplace. (Oppose) Held inAppropriations Committee.AB 1399 (Committee on Labor and Employment) Employment Records: Right toInspect – Requires an employer to maintain personnel records for a specified period oftime and to provide a current or former employee an opportunity to inspect and makecopies of those records within a specified period of time. (Oppose) Held inAppropriations Committee.SB 569 (Kehoe) Alternative and Renewable Fuel and Vehicle TechnologyProgram: Electrical Work – Requires electrical work involved in a project beperformed by a licensed electrical contractor or a state-certified general electricianworking under a licensed electrical contractor and requires a project to includepartnership with one or more existing electrical joint apprenticeship programs in thegeographic area of the project. (Oppose) Held in Transportation Committee.AB 1286 (Fuentes) Wage Disputes – Provides that when a dispute exists between anemployer and an employee over earned wages that is the subject of a pending class

2011 Legislative SummaryPage 9action or representative action, a waiver, release or settlement is not valid unless allparties are represented by counsel, a superior court approves the release as areasonable and good faith resolution of the dispute, as defined, or the Division of LaborStandards Enforcement has negotiated a settlement between the parties. (Oppose)Held in Labor Committee.AB 742 (Lowenthal) Liberty Quarry – Would prohibit operation of Liberty Quarry byGranite Construction near the City of Temecula. (Oppose) Legislation held in Senate –two year bill.AB 356 (Hill) – Public Works – Local Hire Policies - Prohibits a local agency frommandating that any portion or percentage of work on a public works project beperformed by local residents or persons who reside within particular geographic areas ifany portion of that public works project will take place outside the geographicboundaries of the local agency and requires any increase in the cost of a state-fundedpublic works project that is attributable to a policy of hiring only local residents befunded with local funds. (Support) Held in Assembly. Two year bill.AB 605 (Dickinson) – CEQA – Transportation – Would require the drafting ofguidelines to reduce vehicle miles traveled in regards to new development projects.(Oppose) Held in Assembly- two year bill.SB 438 (Canella) – Off Site Prevailing Wages – Would require off-site prevailingwages to be paid only if the facility is dedicated to supplying materials for a public work.(Support - Co-Sponsor) Held in Senate – two year bill.SB 867 (Padilla) – Build California Bonds - This bill permits the CaliforniaTransportation Financing Authority issue nonrefundable tax credit bonds,which would be available to California income taxpayers, to fund the construction oflocal transportation projects. (Support) Held in Senate – two year bill.(Report status is as of 9-13-11)

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