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SB-674 Public Contracts: workforce development: transportation-related contracts.(2021-2022)

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Date Published: 02/19/2021 09:00 PM
SB674:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 674


Introduced by Senator Durazo

February 19, 2021


An act to add Chapter 6.8 (commencing with Section 6980) to Part 1 of Division 2 of the Public Contract Code, relating to public contracts.


LEGISLATIVE COUNSEL'S DIGEST


SB 674, as introduced, Durazo. Public Contracts: workforce development: transportation-related contracts.
Existing law establishes the Labor and Workforce Development Agency, under the supervision of the Secretary of Labor and Workforce Development. Existing law establishes within the Labor and Workforce Development Agency, the Department of Industrial Relations, to foster, promote, and develop the welfare of the wage earners of California and to advance their opportunities for profitable employment, among other duties.
Existing law, the State Contract Act, governs contracting between state agencies and private contractors, and sets forth requirements for the bidding, awarding, and overseeing of contracts for projects. Existing law, the Local Agency Public Construction Act, establishes contracting by local agencies for the construction of public works, and requires local agencies to comply with specified procedures for contracting of public works projects, including, the use of a competitive bidding process and awarding contracts to the lowest responsible bidder, as provided.
This bill would require relevant public agencies, as defined, to develop a program, known as the California Jobs Plan Program, to meet specified objectives, including, as a component of applications for covered public contracts, as defined, creation of a form that states the minimum numbers of proposed jobs that are projected to be retained and created if the applicant wins the covered public contract, and proposed wages, benefits, and investment in training. That component of the application would be known as the California Jobs Plan, as defined. Other objectives of the program, pursuant to the bill, would include supporting the hiring of displaced workers and individuals facing barriers to employment, as defined; encouraging the development of the state’s long-term green transportation and related infrastructure and manufacturing sector; and protecting public health by supporting the adoption of specific protections for worker health and safety.
This bill would require the Labor and Workforce Development Agency, with input from the relevant public agencies, to create procedures and criteria to evaluate applicants for covered public contracts that would award additional consideration to applicants who meet specified criteria. The bill would require the applicant’s California Jobs Plan to be scored as part of the overall application. The bill would also require applicants for subsidies and noncompetitive contracts to complete the form. The bill would make the California Jobs Plan submitted by a recipient of a covered public contract a material term of the contract.
This bill would require the Labor and Workforce Development Agency to develop a web-based portal and recipients of covered public contracts, beginning on an unspecified date in 2022, and would require the agency to upload progress reports to the portal, as specified. The bill would require the portal to be designed in such a manner that, if the information entered into the portal indicates a failure to comply with the commitments made in the California Jobs Plan submitted by the applicant, then an automatic notice of noncompliance would be sent to the relevant public agency.
This bill would require the Labor and Workforce Development Agency to make publicly available, via the web-based portal, the commitments made in the covered public contracts. The bill would require the Labor and Workforce Development Agency to also develop a web-based portal to track compliance, as specified, and would require the Labor and Workforce Development Agency to make that information publicly available on its website.
By imposing new duties on local jurisdictions, this bill would create a state-mandated local program.
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.
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 the statutory provisions noted above.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 Chapter 6.8 (commencing with Section 6980) is added to Part 1 of Division 2 of the Public Contract Code, to read:
CHAPTER  6.8. California Jobs Plan Act of 2021

6980.
 This chapter shall be known, and may be cited, as the California Jobs Plan Act of 2021.

6981.
 (a) The Legislature finds and declares all of the following:
(1) In a time of uncertainty with so many Americans out of work, employment stability and equity are a primary concern.
(2) Spending on green investments creates more jobs per dollar than other infrastructure investments and these jobs are accessible and well paying. Every one million dollars ($1,000,000) in spending on renewable energy creates 7.5 full-time jobs.
(3) Historically vulnerable groups have been disproportionately impacted by economic downturns. For example, for every one percentage point increase in the overall unemployment rate, there is a 1.8-percent increase in African American unemployment.
(4) It is essential that the state, in cooperation with the federal government, use all practical and commercially feasible means to promote the prompt and efficient development of energy sources that are renewable or that more efficiently use and conserve scarce energy resources.
(5) It is in the public interest to do all of the following:
(A) Prioritize reversing factors that have resulted in disproportionate health impacts and economic suffering due to the coronavirus (COVID-19) pandemic among California’s low-income communities, communities of color, and immigrant communities that have historically faced underinvestment and discriminatory policies.
(B) Promote sustainable and renewable energy sources, implement measures that increase efficient energy use, advance transportation technologies that reduce the degradation of the environment, lessen the state’s dependence of fossil fuels, and protect the health, welfare, and safety of the people of this state.
(C) Spend resources to avoid recreating historical patterns of injustice by allocating resources in a manner that will create a just transition to a green, regenerative economy, founded on climate, racial, and economic justice, that puts an end to extreme inequality and systemic racial injustice, and ensures all Californians have a clean and safe environment in which to live, work, and play.
(D) Support a just recovery where workers from all sectors who have lost wages or jobs as a direct result of the pandemic will be prioritized for new employment opportunities that guarantee family-sustaining incomes, pensions, benefit training, retraining, and early retirement assistance.
(E) Require recovery spending to include a mandate for a robust, fully funded public sector that includes significant investments in job creation and community development with a particular focus on a just transition for affected workers.
(F) Expend resources in a broadly inclusive economic and democratic process that ensures robust, accessible opportunities for all Californians to determine the future of our government and economy.
(G) Allocate state funds to programs, businesses, organizations, agencies, and institutions that provide the greatest opportunities for good green jobs, strong labor provisions, and climate-based solutions in a manner that is consistent with the urgency of the climate crisis and the need to make rapid and sustained reductions in greenhouse gases and statewide emissions reduction targets and recommendations from the Intergovernmental Panel on Climate Change.
(b) It is therefore the intent of the Legislature to support the creation of equitable high-quality transportation and related manufacturing and infrastructure jobs in California through the enactment and implementation of this chapter.

6982.
 Unless the context requires otherwise, for the purposes of this chapter, the following terms shall have the following meanings:
(a) “Applicant” means a person that applies, bids, or seeks qualification for a covered public contract. “Applicant” may be more than a single entity.
(b) “Covered public contract” means any transportation-related contract with a present value of five million dollars ($5,000,000) or more to which a California state or local agency is a party or a transportation-related subsidy, grant, or loan with a present value of five million dollars ($5,000,000) or more that is provided, granted, or guaranteed by a state or local agency. To the extent otherwise permitted by law, the term “covered public contract” includes, but is not limited to, contracts funded in whole or in part by any of the following:
(1) The Road Maintenance and Rehabilitation Account established by Section 2031 of the Streets and Highways Code.
(2) The Affordable Housing and Sustainable Communities Program (Chapter 2 (commencing with Section 75210) of Part 1 of Division 44 of the Public Resources Code) and the Low Carbon Transit Operations Program (Part 3 (commencing with Section 75230) of Division 44 of the Public Resources Code).
(3) The Public Transportation Account established pursuant to Article 6.5 (commencing with Section 99310) of Chapter 4 of Part 11 of Division 11 of the Public Utilities Code.
(4) The State Highway Account created in the State Transportation Fund pursuant to Section 182 of the Streets and Highways Code.
(5) The Traffic Congestion Relief Fund created by Section 14556.5 of the Government Code.
(6) The State Transit Assistance Program created pursuant to Section 99312.2 of the Public Utilities Code.
(7) The Public Transportation Modernization, Improvement, and Service Enhancement Account created in the Highway Safety, Traffic Reduction, Air Quality, and Port Security Fund pursuant to subdivision (f) of Section 8879.23 of the Government Code.
(8) The Highway Safety, Traffic Reduction, Air Quality, and Port Security Fund created pursuant to Section 8879.23 of the Government Code.
(9) The Passenger Equipment Acquisition Fund created pursuant to Section 14066 of the Government Code.
(10) The Alternative and Renewable Fuel and Vehicle Technology Fund created pursuant to Section 44273 of the Health and Safety Code.
(11) Any relevant federal funding received by California or local agencies.
(c) “California Jobs Plan” refers to a component of an application submitted by applicants for covered public contracts where applicants state the minimum number of jobs, proposed wages, benefits, investment in training, specific protections for worker health and safety, and targeted hiring plans for displaced workers and individuals facing barriers to jobs created or retained in California in exchange for public contracts covered under this chapter. This component shall not require any application minimums other than those already required by relevant federal, state, and local laws.
(d) “Displaced Worker” means either of the following:
(1) Any employee who was employed by the employer for 6 months or more in the 12 months preceding the January 31, 2020, declaration of a national state of emergency by the President, and whose most recent separation from active service was due to a public health directive, government shutdown order, lack of business, a reduction in force, or other economic, nondisciplinary reason related to the COVID-19 pandemic.
(2) Any employee whose most recent separation from active service was due to lack of business, a reduction in force, or other economic, nondisciplinary reason related to the transition from the fossil fuel industry to renewable energy.
(e) “Individual Facing Barriers to Employment” means either of the following:
(1) An individual facing barriers to employment as defined in subdivision (j) of Section 14005 of the Unemployment Insurance Code.
(2) An individual from a demographic group that represents less than 30 percent of their relevant industry workforce according to the United States Bureau of Labor Statistics.
(f) “Labor and Workforce Development Agency” or “agency” means the agency established pursuant to Part 8.5 (commencing with Section 15550) of Division 3 of Title 2 of the Government Code.
(g) “Transportation-related equipment” means tangible personal property having a useful life of more than one year and a per-unit acquisition cost which exceeds twenty-five thousand dollars ($25,000), including, but not limited to, streetcars, trackless trolleys, buses, light rail systems, rapid transit systems, medium- and heavy-duty trucks, subways, trains, jitneys, fare boxes, bicycles, information technology systems, and charging stations.
(h) “Transportation-related infrastructure” means the construction or installation of physical property necessary for the operation of transportation equipment, not including roads, bridges, or highways.
(i) “Protections for worker health and safety” means intentional action taken to protect workers from the COVID-19 pandemic, including, but not limited to, access to personal protective equipment, public health councils, workplace infection control measures, social distancing policies, paid sick leave policies, and hazard pay.
(j) “Relevant public agency” means any city, county, or state agency in the state.
(k) “Services” means all activities related to the construction, operation, and maintenance of transportation equipment and transportation-related infrastructure.
(l) “Temporary job” means a job for which the employee is supplied by a temporary services employer, as defined in subdivision (b) of Section 606.5 of the Unemployment Insurance Code.
(m) “Transportation jobs” means all jobs created or retained in the manufacture, installation, maintenance, and operation of transportation systems and equipment in the state.
(n) “Transportation-related contract” means the public investment in or purchase of equipment, services, or transportation-related infrastructure connected to the operation of any mode of transportation in the state.

6983.
 Relevant public agencies shall design the California Jobs Plan Program to meet all of the following objectives:
(a) Create a California jobs plan form as a component to applications for covered public contracts to specifically incentivize and support the creation and retention of quality, nontemporary and full-time transportation jobs that provide high wages, including benefits and access to training and protections for worker health and safety. This application component shall not require any minimum commitments other than those already required by relevant federal, state, and local laws. The component shall request that the applicant state the minimum numbers of proposed jobs and other related information that are projected to be retained and created if the applicant wins the covered public contract in the following categories:
(1) The number of full-time nontemporary jobs proposed to be retained and created.
(2) The number of full time temporary jobs proposed to be retained and created.
(3) The number of part-time temporary jobs proposed to be retained and created.
(4) The number of part-time nontemporary jobs proposed to be retained and created.
(5) The number of jobs classified as “employees,” as specified in Section 2750 of the Labor Code.
(6) The number of positions classified as “independent contractors,” as specified in Section 2750.5 of the Labor Code.
(7) The number of all jobs proposed to be retained or created for individuals facing barriers to employment.
(8) The number of all jobs proposed to be retained or created for displaced workers.
(9) The wage levels by job classification.
(10) Proposed amounts to be paid for fringe benefits by job classification.
(11) Proposed amounts to be paid for worker training by job classification.
(b) Support the hiring of displaced workers and individuals facing barriers to employment.
(c) Encourage the development of the state’s long-term green transportation and related infrastructure and manufacturing sector.
(d) Protect public health by supporting the adoption of specific protections for worker health and safety.

6984.
 (a) The Labor and Workforce Development Agency shall create procedures and criteria for public agencies to evaluate applicants for covered public contracts pursuant to this chapter. To the extent feasible, the Labor and Workforce Development Agency shall seek input from, and consider the recommendations of, affected relevant public agencies on the proposed procedures and criteria to support or ensure consistency with existing policies, programs, and plans. The procedures and criteria shall award additional consideration to applicants who do any of the following:
(1) Propose the highest value and quality California Jobs Plan in its application.
(2) Enhance the state’s commitment to energy conservation, pollution and greenhouse gas emissions reduction, and transportation efficiency.
(3) Retain the greatest number of full-time, nontemporary employees compensated at a wage rate substantially above the prevailing wage for a similar industry based on the North American Industry Classification System (NAICS) Code in the project jurisdiction or in the state.
(4) Make concrete commitments to creating the greatest number of full-time, non-temporary jobs at a wage rate substantially above the prevailing wage for a similar industry based on the NAICS Code in the project jurisdiction or in the state.
(5) Make concrete commitments to maintaining at least 90 percent of the labor on a contract performed by properly classified employees pursuant to Assembly Bill 5 (hereafter AB 5; Chapter 296 of the Statutes of 2019).
(6) Offer targeted training and opportunities for individuals facing barriers to employment and displaced workers.
(7) Have the greatest beneficial economic impact on the state and local economies as a result of receiving the public contract, based on the priority criteria outlined in this chapter.
(b) The criteria guidelines and policies shall be exempt from the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

6985.
 The California Jobs Plan shall be scored as a part of the overall application for the covered public contract. To the extent that a subsidy or other covered public contract is noncompetitive, applicants shall still be required to complete the California Jobs Plan application form. The California Jobs Plan shall then be included in the awarded public contract as a material term. All job-related commitments made by companies during the application process shall be accessible to the public once the public contract is awarded through the web-based portal to be developed by the Labor and Workforce Development Agency as described in Section 100606.

6986.
 (a) Beginning on ____ 2022, and annually thereafter, recipients of covered public contracts, under this chapter, shall be required to upload progress reports on the commitments made in the California Jobs Plan. At a minimum, the information provided pursuant to this subdivision shall include all of the following:
(1) The number of full-time nontemporary jobs to be retained and created.
(2) The number of full-time temporary jobs to be retained and created.
(3) The number of part-time temporary jobs to be retained and created.
(4) The number of part-time nontemporary jobs to be retained and created.
(5) The number of jobs classified as “employees” pursuant to AB 5.
(6) The number of positions classified as “independent contractors” pursuant to AB 5.
(7) The number of all jobs to be retained or created for individuals facing barriers to employment.
(8) The number of all jobs to be retained or created for displaced workers.
(9) The wage levels by job classification.
(10) Any amounts that will be paid for fringe benefits by job classification.
(11) Any amounts that will be paid for worker training by job classification.
(12) Information on training programs targeted specifically towards individuals facing barriers to employment.
(13) Estimated amount of greenhouse gas emissions reduced as a result of this contract.
(b) The Labor and Workforce Development Agency shall develop a web-based portal to which recipients of covered public contracts shall be required to upload progress reports on the commitments made in the California Jobs Plan, as described in subdivision (a). The portal shall be designed is such a manner that, if the information entered into the portal indicates a failure to comply with the commitments made in the California Jobs Plan, then an automatic notice of noncompliance would be sent to the relevant public agency respective to the contract.
(c) The Labor and Workforce Development Agency shall develop a web-based portal to track compliance with the California Jobs Plan that shall be accessible to the public through the Labor and Workforce Development Agency’s website.

SEC. 2.

 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.