1. Welcome to the NIGP/ CAPPO Ninth Annual Cooperative Conference CUPCCAA and SB854
Presenters:
John Finney, Contract Services Manager
Tracy Soth, Senior Contract Services Officer

4. California Uniform Public Construction Cost Accounting Act (CUPCCAA)
Public Contract Code, Sections – 22050
These sections are known as the “Uniform Public Construction Cost Accounting Act”

5. California Uniform Public Construction Cost Accounting Act (CUPCCAA)
It allows local agencies to informally perform public works projects of up to $175,000, if the agencies elect to follow the cost accounting procedures set forth in the Cost Accounting Policies and Procedures Manual of the California Uniform Construction Cost Accounting Commission.

6. California Uniform Public Construction Cost Accounting Act (CUPCCAA)
Public projects of $45,000 or less may be performed by the employees of a public agency by force account, by negotiated contract, or by purchase order.
Public projects between $45,000 and $175,000 may be let to contract by informal procedures as set forth in the Act.
Public projects of more than $175,000 shall, except as otherwise provided in the Act, be let to contract by formal bidding procedure.

7. “Public Works” Defined
Why “public works”? Provides local public agencies an alternative to burdensome and time-consuming formal competitive bidding process on public projects
Public Contract Code – erection, construction, alteration, repair, or improvement of any public structure, building, road, or other public improvement of any kind
Labor Code – more extensive, includes above, plus demolition, installation, laying of carpet, and assembly and disassembly of modular office systems… paid for in whole or in part out of public funds; includes maintenance
Bidding/Contracting Mechanism – Use Public Contract Code
Prevailing Wages – Use Labor Code

8. What is NOT a “Public Work”
Routine, recurring and usual work for the preservation or protection of any publicly owned or publicly operated facility
Minor repainting
Resurfacing of streets & highways at less than 1”
Landscape maintenance

9. Adopting CUPCCAA
The governing board must elect by resolution to become subject to the California Uniform Public Construction Cost Accounting Act.
The agency must notify the State Controller in writing of its election to become subject to the uniform cost accounting procedures and forward a copy of the resolution.

10. Adopting CUPCCAA
The agency must adopt a policy outlining informal bidding procedures.
Once an agency has opted in, it must conform to the uniform cost accounting procedures until the district opts out of the Act by adopting a resolution opting out and forwarding said resolution to the State Controller.

11. Force Account / Work Done by Purchase Order/Contract
When estimating for a project up to $45,000; keep in mind that all standard public contract and labor code requirements must be met including but not limited to the requirement to call for prevailing wages, payment bond for projects in excess of $25,000, fingerprinting, certifications, etc.
Change orders are only permitted to a maximum contract total of $45,000.
Note: Any non-emergency work done by force account in excess of $45,000 is a violation of the Act.
Best practices would include ensuring that you are getting the required scope of work for the best price; therefore, obtaining multiple quotes is desirable.
When internal forces are also bidding on the work; the project cost must include labor, materials, supplies, equipment, and overhead.

12. Informal Bidding
Projects between $45,000 and $175,000. Project must be let by competitive bid utilizing informal, streamlined procedures utilizing one of two options:
Advertisement by bidders list: All contractors on the list for the category of work being bid as specified in Section 22034
Advertisement through trade journals and exchanges: All construction trade journals specified in Section 22036

13. Informal Bidding – Bidder’s List
Advertisement by bidders list: All contractors on the list for the category of work being bid as specified in Section (a).
There is NO exemption to maintaining a list of bidders. To be in compliance with the Act, an Agency must follow PCC which outlines the requirements for the qualified Bidder’s List
If an Agency chooses the list, they must maintain the list in accordance with the Manual which includes updating the bidders list at minimum annually by license type, and qualifications.

14. Informal Bidding
PCC All contractors on the list for the category of work being bid OR all construction trade journals specified in Section 22036, or both, shall be mailed* a notice inviting informal bids unless the product or service is proprietary.
The notice shall be sent at least 10 days prior to bid opening.
All standard public contract and labor code requirements must be met including but not limited to prevailing wages, payment bond for projects in excess of $25,000, fingerprinting, escrow agreement, DVBE, labor compliance, etc.
The authority to award informal contracts may be delegated.
Contracts may be awarded up to $175,000. When all bids received are above $175,000, a contract may be awarded up to $187,500.

15. Formal Bidding
Formal bids are let using the standard bid process as outlined in Public Contract Code (for Counties – 20120)
Notice to Contractors – Changes from 10-day to 15-day notice per Government code 6062
The notice shall be published pursuant to government code 6066 – changes from Bidders List to Trade Journals or a bidders list and trade journals.
Governing Board must first approve plans and specifications, and must approve final contract award.

16. “Emergency”

17. “Emergency” A “sudden, unexpected occurrence
that poses a clear and imminent danger,
requiring immediate action
to prevent or mitigate the loss or impairment of life, health, property or essential public services.”
(PCC Section 1102)

18. Emergency Contracts
In cases of emergency when repair or replacements are necessary
The governing board may proceed at once to replace or repair any public facility without adopting plans, specifications, strain sheets, or working details, or giving notice for bids to let contracts.
The governing board may direct the work to be done by day labor, by contractor, or by a combination of the two.

19. All without giving notice for bids to let contracts
Emergency Contracts
In cases of emergency when repair or replacements are necessary
The governing board, By a four-fifths vote may:
repair or replace a public facility
take any directly related and immediate action required by that emergency
procure the necessary equipment, services, and supplies for those purposes
All without giving notice for bids to let contracts

20. Emergency Contracts
In cases of emergency when repair or replacements are necessary
The authority to enter emergency contracts may be delegated by a four-fifths vote of the governing board
as long as the designee takes the action to the governing board within 7 days
or at its next regularly scheduled meeting which shall be no more than 14 days after the action was taken
The designee must report at each following meeting until the action is terminated (contract completed)
Code is in conflict with boards that meet on a monthly basis.

21. CUPCCAA Benefits Increased force account limits
Informal bidding procedures for projects within $45,000 -$175,000
Reduce number of formal bids
Expedited contracting for small projects

22. Common Concerns Cost accounting policy and procedures
Informal bidding procedures
Accounting review procedures

23. Section 2 – Contracting Options
Summary Table of Public Works Contracting Methods and Authority
Type of Project
Project Cost
Contracting Options
Awarding Authority
Statute
Materials and Supplies
<=$3,500
Purchase Order (no bids required)
Purchasing Agent
PCC 20131
SCC 2.56
New Construction
<=$6,500
<=$45,000
Formal Bid
Board*
PCC et seq
SCC 2.56,
Informal Bid (CUPCCAA)
Chief Deputy CE / Designee
Force Account
Performed by County Staff
Purchase Order (CUPCCAA)
Negotiated Contract
Varies
>$45,000 and <=$175,000
SCC , 2.155
>$175,000
>=$2,500,000
Design-Build
PCC 20133
Roadwork (SacDOT only)
<30% of force account work as of January 1
Force Account subject to prior notice
Road Commissioner / Board
PCC 20395, 22031
Maintenance, Repair, Remodeling, Minor Alterations (including Roadways and Bridges)
$ Limits Above
Same Options as Above
Same as Above
<=$3,000,000
adjusted annually since 1998 to reflect % change in California CPI
(now +/-$4,464,000)
JOC
Board for Initial Award; Tasks:
<=$50,000 Director, DGS <=$100,000 Chief Deputy CE, ISA
>$100,000 CEO / designee
PCC
RSO#
Roadways/Bridges – Maintenance and Repair
(SacDOT only)
<=$25,000
PCC 20394
SCC ,
<=$50,000
48-Hour Informal Bid
PCC
SCC
>$45,000
Emergency
PCC 22035, 22050
SCC
Any $ limit
Emergency Contract
Board**

24. Developing Procedures
Contracting Method
Plans and Specifications
Risk Assessment and Insurance
Payment and Performance Bonds
Prevailing Wages
Notice to Contractors
Bid Form and Bidding
Protests/Requests for Relief/Substitutions
Award of Contract
Contract Administration and Management
Change Orders
Compensation
Project Completion
Records Retention

25. Performance & Payment Bonds
Payment bonds are required for projects exceeding $25,000 (Civil Code Sections 9550, 9552).
Performance bonds are required for construction projects (PCC Section 20129(b)).
Contracting via Purchase Order does not cancel the requirement for payment and performance bonds. (Note: stop payment notices apply to purchase orders, so payment bonds are needed with purchase orders.)
Performance bonds are the leverage to get work completed if the contractor defaults and to get warranty work done.

26. Prevailing Wages
Prevailing wages are required for all public works projects exceeding $1,000…
With our (Sac County) Labor Compliance Program, the threshold increases to $15,000 for maintenance and repair projects and to $25,000 for construction projects.
For federally funded projects, notwithstanding our LCP, the threshold is $2,000.
How to determine if prevailing wages are required?

28. Senate Bill 854 IMMEDIATE CHANGES
Duty to notify DIR when awarding a contract for a public works project, using the online PWC-100 form.
This requirement, found in Labor Code Section , now applies to all public works projects. Previously it applied to projects costing greater than $30,000.

29. Senate Bill 854 IMMEDIATE CHANGES
Elimination of the obligation to pay DIR for compliance monitoring on state bond-funded projects and other projects that required use of DIR's Compliance Monitoring Unit (CMU).
DIR will continue to monitor compliance on these projects but will not charge awarding bodies for any services provided on or after June 20, 2014 [the effective date of SB 854].
The alternative of using a DIR-approved Labor Compliance Program (LCP) or a project labor agreement in lieu of the CMU on one of these projects has also been eliminated. However, for ongoing projects that were using one of the alternatives, monitoring should continue until the project is completed.

30. Senate Bill 854 Public Works Contractor Registration Program
PHASED-IN CHANGES
Public Works Contractor Registration Program
All contractors and subcontractors who bid or work on a public works project must register and pay an annual fee to DIR.
July 1, 2014: Registration program became effective and first contractors registered. Initial registrations will be valid through June 30, 2015.
March 1, 2015: No contractor or subcontractor may be listed on a bid proposal for a public works project unless registered with DIR.
April 1, 2015: No contractor or subcontractor may work on a public works project unless registered with DIR.

31. Senate Bill 854 Public Works Contractor Registration Program
PHASED-IN CHANGES
Public Works Contractor Registration Program
Once the registration requirement becomes mandatory (March 1, 2015 for bids and April 1, 2015 for work), an awarding body may not accept a bid or enter into a contract for public work with an unregistered contractor.
DIR maintains an up-to-date listing of registered contractors.
There are exceptions to the registration requirement for bidders in circumstances where a CSLB license would not be required at the time of bidding.
Additional exceptions and protections are included in the registration laws to limit bid challenges, allow some violations to be cured through payment of penalty fees, and allow unregistered contractors to be replaced with registered ones.

32. Senate Bill 854 II. NOTICE REQUIREMENTS
PHASED-IN CHANGES
II. NOTICE REQUIREMENTS
January 1, 2015: The call for bids and contract documents must include the following information:
No contractor or subcontractor may be listed on a bid proposal for a public works project (submitted on or after March 1, 2015) unless registered with the Department of Industrial Relations pursuant to Labor Code section [with limited exceptions from this requirement for bid purposes only under Labor Code section (a)].
No contractor or subcontractor may be awarded a contract for public work on a public works project (awarded on or after April 1, 2015) unless registered with the Department of Industrial Relations pursuant to Labor Code section
This project is subject to compliance monitoring and enforcement by the Department of Industrial Relations.

33. Senate Bill 854
PHASED-IN CHANGES
III. FURNISHING OF ELECTRONIC CERTIFIED PAYROLL RECORDS TO LABOR COMMISSIONER
All contractors and subcontractors must furnish electronic certified payroll records directly to the Labor Commissioner (aka Division of Labor Standards Enforcement). The phase-in timetable for this requirement is as follows:
June 20, 2014 [immediate]: Any project that was being monitored by the CMU/Labor Commissioner prior to the adoption of SB 854 will continue to be monitored by the Labor Commissioner afterward; and the contractors on those projects must continue to furnish certified payroll records to the Labor Commissioner until the project is complete.
April 1, 2015: For all new projects awarded on or after this date, the contractors and subcontractors must furnish electronic certified payroll records to the Labor Commissioner.
Anytime: For projects besides those listed above, the Labor Commissioner may at any time require the contractors and subcontractors to furnish electronic certified payroll records. The Labor Commissioner anticipates requiring this for green energy school projects that receive Proposition 39 funding.

34. Senate Bill 854
PHASED-IN CHANGES
III. FURNISHING OF ELECTRONIC CERTIFIED PAYROLL RECORDS TO LABOR COMMISSIONER
All contractors and subcontractors must furnish electronic certified payroll records directly to the Labor Commissioner (aka Division of Labor Standards Enforcement). The phase-in timetable for this requirement is as follows (continued):
January 1, 2016: The requirement to furnish electronic certified payroll records to the Labor Commissioner will apply to all public works projects, whether new or ongoing.
Exceptions: The Labor Commissioner may (but is not required to) excuse contractors and subcontractors from furnishing electronic certified payroll records to the Labor Commissioner on a project that is under the jurisdiction of one of the four legacy DIR-approved labor compliance programs (Caltrans, City of Los Angeles, Los Angeles Unified School District, and County of Sacramento) or that is covered by a qualifying project labor agreement.
These new requirements will apply to all public works that are subject to the prevailing wage requirements of the Labor Code, without regard to funding source.

35. Questions?
Contact information:
John Finney, Contract Services Manager
Tracy Soth, Senior Contract Services Officer

36. Questions?
Contact information:
Public Contract Code
California State Controller
Local Government Policies – Lilian Apgar (State Controllers office) 3301 C Street, Suite 740 Sacramento

37. The End