HomeMy WebLinkAboutItem MAGENDA REPORT
DATE:
June 25, 2001
TO:
Honorable Mayor and City Council
THRU:
John B. Bahorski, City Manager
FROM:
Doug Danes, Interim Director of Public Works
SUBJECT: Opposition Letter re: SB 974 and SB 1119 — Bid Solicitation
and Contracts: Charter Cities
SUMMARY OF REQUEST:
Authorize Mayor to sign letters opposing Senate Bill (SB) 974 and 1119. Receive and File
Status Report.
BACKGROUND:
Charter cities within the state may specify the organization and powers of the city in its
charter, which operates as a mini - constitution that allows the local community to design
an alternative structure to its government. Of California's 475 cities, 105 are charter
cities.
SB 1119 places the burden on charter cities to announce to contractors that they are
dealing with a charter city, which may not have the same contracting rules as the State of
California.
SB 974 applies the Public Contract Code to all public entifies, in the absence of an
express exemption or a charter city ordinance or regulation that is in direct conflict with
the code.
The League of California Cities and many cities throughout the State have opposed these
legislative proposals. The opposition is based on concerns regarding the adverse impacts
to those charter cities in providing the flexibility to respond to local concerns and to
provide rules that work best within their local jurisdictions. The impacts of this
legislation could result in current city ordinances being required to be rewritten, could
cause unnecessary confusion regarding which provisions would be applicable, and cause
increased exposure to lawsuits over the applicability of a charter city provision or the
provisions of the Public Contract Code. State laws should only be applied if the matter is
of statewide concem, and if not, then local charter provisions and implementing
ordinances should apply.
Agenda Item _A'
C:NyD mm \My Council Stuff Rep MSB 974- 1119.CC Stuff Rq Adoc \Lw IMI
City Opposition Letters to SB 974 and 1119 — Public Contracts: Charter Cities
City Council Staff Report
June 25, 2001
The Cities of Anaheim, Los Alamitos, San Jose, Santa Rosa, and Signal Hill have sent
letters to the Assembly Local Government Committee.
FISCAL IMPACT:
Uncertain. Could result in indirect costs in revising city ordinances and direct costs in
litigation expenses if lawsuits are Sled by contractors challenging the right of charter
cities to award contracts in compliance with local charter provisions, as opposed to the
provisions of the Public Contracts Code.
RECOMMENDATION:
Authorize Mayor to sign letters opposing Senate Bill (SB) 974 and 1119. Receive and File
Status Report.
" (a
Does A. Dancs, P.E.
Interim Director of Public Works /City Engineer
Attachments: (4)
Attachment 1:
City Comment Letter Opposing SB 974
Attachment 2:
SB 974, as amended on April 16, 2001
Attachment 3:
City Comment Letter Opposing SB It 19
Attachment 4:
SB 1119, as amended on May 17, 2001
SB 974- 1119.CC SOfTRe ft
June 25, 2001
Senator Tom Torlakson
State Capitol, Room 2068
Sacramento, CA 95814
SUBJECT:. NOTICE OF OPPOSITION - SB 974 (TORLAKSON).
PUBLIC CONTRACTS: CITIES
Dear Senator Torlakson:
We regret to inform you that the City of Seal Beach OPPOSES your SB 974. In brief,
this measure would adversely impact California's charter cities. Charter cities have
determined a need for flexibility granted under the California Constitution to respond to
local concerns and to provide rules that work best within their local jurisdictions.
This legislation could result in current city ordinances being required to be rewritten,
could cause unnecessary confusion regarding which provisions would be applicable, and
cause increased exposure to lawsuits over the applicability of a charter city provision or
the provisions of the Public Contract Code. The long -term fiscal impacts to charter cities
of this proposed legislation is uncertain. This legislation could result in indirect costs in
revising city ordinances and direct costs in litigation expenses if lawsuits are filed by
contractors challenging the right of charter cities to award contracts in compliance with
local charter provisions, as opposed to the provisions of the Public Contracts Code.
Chatter cities have determined a need to have flexibility to respond to local concerns and
to provide rules that work best in their local jurisdiction, and developed a specific charter
to reflect those local issues and concerns. Charter cities are specifically granted this type
of local authority by the California Constitution, granting "home rule" doctrine
precedents over conflicting state statutes. This legislation will severely impact those
"Constitutional Home Rule" rights that charter cities have determined to avail themselves
of.
Seal Beach opposes SB 974 as it will adversely affect charter cities by taking away their
flexibility to respond to local concerns and to provide rules that work best within their
local jurisdictions. The existing system allows contractors the ability to determine if a
CAMy Down .MEEGISIA1 B 974.CC Opp ufi.lahr.dactl.tt�OG25 -01
City of Seal Beach Opposkion Letter re:
Public Contracts: Charter Cities
June 25, 2001
city is a charter city, and what their public contract provisions are. There is no necessity
for the state to become involved with this type of a local issue.
Sincerely,
am J. D4 Xe-
Mayor, City of Seal Beach
cc: Members and Consultant, Assembly Local Government Committee
Assembly Member Tom Harman
Senator Ross Johnson
Senator Bob Margett
Natasha Fooman, Legislative Representative, League of California Cities
Janet Huston, Orange County Division, League of California Cities
SB MCC Opp mfi.. U=
City Opposition Letters to SB 974 and 1119— Public Contracts: Charter Cities
City Council StaffRepon
June 25. 2001
ATTACHMENT 2
SB 974
SB 974- 1119.CC Sniff Report
City Opposition Letters to SB 974 and 1119 - Public Contracts: Charter Cilia
City Council StaffReporl
June 25, 2001
BILL NUMBER: SB 974 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 11, 2001
AMENDED IN SENATE APRIL 16, 2001
INTRODUCED BY Senator Torlakson
(Coauthor: Assembly Member Wiggins)
FEBRUARY 23, 2001
An act to add Section 1100.7 to the Public Contract Code, relating
to public contracts.
LEGISLATIVE COUNSEL'S DIGEST
SB 974, as amended, Torlakson. Public contracts: cities.
The Public Contract Code contains various definitions of a "public
entity,- all of which include a city as a public entity. Under the
California Constitution, a city may, as an alternative to being
entirely subject to the general law of the state, elect to operate
pursuant to a charter that authorizes the enactment of ordinances and
regulations superseding the general law of the state with respect to
municipal affairs.
This bill would state that the Public Contract Code is the basis
of contracts between most public entities and their contractors and
subcontractors. This bill would further state, with regard to
charter cities, that this code applies in the absence of an express
exemption or a charter city ordinance -lea
that is in direct conflict with that code.
The bill would state that these provisions are declaratory of
existing law.
Vote: majority. Appropriation: no. Fiscal committee: no.
State - mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares that there is
considerable ambiguity as to how certain provisions of the Public
Contract Code that refer to a "city" should be construed. To end
this ambiguity, and to state the Legislature's intent that charter
cities be subject to all provisions of the Public Contract Code, in
the absence of a specific exemption or a direct conflict with a city
charter, it is necessary in this act to add Section 1100.7 to the
Public Contract Code to codify the holding in Howard Contracting,
Inc. v. G. A. MacDonald Construction Co. (1998) 71 Cal.App.4th 38.
SEC. 2. Section 1100.7 is added to the Public Contract Code, to
read:
1100.7. This code is the basis of contracts between most public
entities in this state and their contractors and subcontractors.
With regard to charter cities, this code applies in the absence of an
express exemption or a charter city ordinance -e- lat='oa
SB 9]4- 1119.CC SniffRc n
City Opposition Letters to SB 974 and 1119- Public Contracts: Charter Cities
City Council Staj%Report
June 15,1001
that is in direct conflict with the relevant provision of
this code.
SEC. 3. The Legislature finds and declares that Section 1100.7 of
the Public Contract Code, as added by this act, is declaratory of
existing law.
SB 974- I119.CC Sutf Re n
June 25, 2001
Senator Bob Margett
State Capitol, Room 3082
Sacramento, CA 95814
SUBJECT: NOTICE OF OPPOSITION - SB 1119 (MARGETT). BID
SOLICITATION: CHARTER CITIES
Dear Senator Margett:
We regret to inform you that the City of Seal Beach OPPOSES your SB 1119. In brief,
this measure would shift the burden to charter cities to announce to contractors that they
are a charter city and that contracts to which the city enters into may be subject to
provisions of its charter which supercede provisions of the Public Contract Code. This
provision will shift the burden to charter cities to announce this information, thereby
potentially punishing a charter city for a contractor's lack of due diligence in reviewing
contract documents and provisions.
Charter cities have determined a need to have flexibility to respond to local concerns and
to provide rules that work best in their local jurisdiction, and developed a specific charter
to reflect those local issues and concerns. Charter cities are specifically granted this type
of local authority by the California Constitution, granting "home rule" doctrine
precedents over conflicting state statutes. This legislation will severely impact those
"Constitutional Home Rule" rights that charter cities have determined to avail themselves
of.
Seal Beach opposes SB 1119 as it will adversely affect charter cities by taking away their
flexibility to respond to local concerns and to provide rules that work best within their
local jurisdictions. The existing system allows contractors the ability to determine if a
city is a charter city, and what their public contract provisions are. There is no necessity
for the state to become involved with this type of a local issue.
Q\MyDocume Uu GISIA1 1119 =0pposition Ue AwEW\62"l
r "—
City of Seal Beach Opposition Letter re:
SB 1119: Charter Cities Bid Solicitation
June 25, 2001
/Sincerely,
\Aill'am .
Mayor, City of Seal Beach
cc: Members and Consultant, Senate Appropriations Committee
Senator Tom Torlakson
Members and Consultant, Assembly Local Government Committee
Assembly Member Tom Harman
Natasha Fooman, Legislative Representative, League of California Cities
Janet Huston, Orange County Division, League of California Cities
5B HMCC O,,,*m on Celia
City Opposition Letters to SB 974 and 1119 — Public Contracts: Charter Cilia
City Council Staff Report
June 25, 2001
ATTACHMENT 4
SB 1119
SB 974- 1119.CC Staff Rexnt 12
City Opposition Letters to SB 974 and 1119 - Public ContracCS: Charter Cities
City Council Staff Report
June 25, 2001
BILL NUMBER: SB 1119 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 17, 2001
AMENDED IN SENATE APRIL 24, 2001
AMENDED IN SENATE APRIL 2, 2001
INTRODUCED BY Senator Margett
FEBRUARY 23, 2001
An act to add Article 2 (commencing with Section 3200) to Chapter
3 of Part 1 of Division 2 of the Public Contract Code, relating to
public contracts.
LEGISLATIVE COUNSEL'S DIGEST
SB 1119, as amended, Margett. Bid solicitations: charter cities.
The California Constitution authorizes a city to operate pursuant
to a charter that gives the city the authority to make ordinances and
regulations governing municipal affairs. The Public Contract Code
contains provisions that otherwise control the solicitation, award,
and execution of contracts involving public entities.
This bill would require each charter city to state in all bid
solicitations that the city is a charter city, and that any contracts
into which the city enters may be subject to the provisions of its
charter, which may supersede certain provisions of the Public
Contract Code and other provisions of state law.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement, including the creation of a State Mandates Claims Fund
to pay the costs of mandates that do not exceed $1,000,000 statewide
and other procedures for claims whose statewide costs exceed
$1,000,000.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State - mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Article 2 (commencing with Section 3200) is added to
Chapter 3 of Part 1 of Division 2 of the Public Contract Code, to
read:
Article 2. Charter Cities
SB974- 1119.CC SdRRepon 13
City Opposition Letters to SB 974 and 1119- Public Contracts: Charter Cities
City Council Staff Report
June 25, 2001
3200. The Legislature finds that a problem exists with regard to
contracts between charter cities and contractors. When responding to
a bid proposal issued by a charter city, bidders are often unaware
of the city's status as a charter city and do not know that the
contract may be governed in part by the provisions of the city's
charter rather than by state law. Therefore, the Legislature finds
that it is a matter of statewide concern that bidders be given
adequate notice of the special status of charter cities so that
bidders may make informed decisions in submitting their bids and
charter cities have the benefit of an informed pool of bidders.
3201. All cities operating pursuant to a charter, as authorized
by Section 5 of Article xI of the California -men
shall _ _ &11 bid _
Constitution, shall include the following language in all bid
solicitations: "The city is a charter city and that any
contracts into which the city enters may be subject to the provisions
of its charter, which may supersede certain provisions of the Public
Contract Code and other provisions of state 1
law.^
SEC. 2. Notwithstanding Section 17610 of the Government Code, if
the Commission on State Mandates determines that this act contains
costs mandated by the state, reimbursement to local agencies and
school districts for those costs shall be made pursuant to Part 7
(commencing with Section 17500) of Division 4 of Title 2 of the
Government Code. If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.
SE 9741119.CC SuffRgimn 14