BILL NUMBER: SBX1 9INTRODUCED BILL TEXT INTRODUCED BY Senator Moorlach (Coauthors: Senators Anderson, Bates, Fuller, Huff, Nielsen, Runner, Stone, and Vidak) JULY 16, 2015 An act to add Section 14009 to, and to add Article 2.6 (commencing with Section 14140) to Chapter 2 of Part 5 of Division 3 of Title 2 of, the Government Code, relating to transportation. LEGISLATIVE COUNSEL'S DIGEST SB 9, as introduced, Moorlach. Department of Transportation. (1) Existing law creates the Department of Transportation with various powers and duties relative to the state highway system and other transportation programs. This bill would prohibit the department from using any nonrecurring funds, including, but not limited to, loan repayments, bond funds, or grant funds, to pay the salaries or benefits of any permanent civil service position within the department. (2) Article XXII of the California Constitution grants to the State of California and all other governmental entities the choice and authority to contract with qualified private entities for architectural and engineering services for all public works of improvement. This bill would require the Department of Transportation to contract with qualified private entities for architectural and engineering services with respect to public works of improvement undertaken by the department, with a minimum of 15% of the total annual value of these services to be contracted to qualified private entities beginning on July 1, 2016, and increasing each year to a minimum of 50% by July 1, 2023. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature finds and declares all of the following: (a) Over the next 10 years, the state faces a $59 billion shortfall to adequately maintain the state highway system in a basic state of good repair. (b) The 21st Annual Highway Report by the Reason Foundation, published in September 2014, found the following: (1) California has 50,462 lane miles of highways under the administration of the Department of Transportation (Caltrans). (2) Overall, California spent $501,136 per state mile of highway, more than three times the national average, yet California's state highway system ranks 45th in overall performance and cost effectiveness. (3) California spent $102,889 per state mile of highway specifically on maintenance, nearly four times the national average. (4) California spent $48,754 per state mile of highway specifically on administration, more than four times the national average. (c) Proposition 35, approved by voters in 2000, allows Caltrans, without limitation, to contract for architectural and engineering work. Currently, Caltrans only contracts for 10 percent of this work, while 90 percent is completed by permanent state staff, resulting in an inability to adjust staffing levels as workload fluctuates. (d) Hiring permanent state staff with limited-term or one-time funding is fiscally imprudent and leads to structural funding deficiencies. (e) According to the Legislative Analyst's Office, in the Capital Outlay Support Program Review report issued in May 2014, the Capital Outlay Support Program is overstaffed by approximately 3,500 full-time equivalent positions, at a cost of more than $500 million annually. SEC. 2. Section 14009 is added to the Government Code, to read: 14009. The department may not use any nonrecurring funds, including, but not limited to, loan repayments, bond funds, or grant funds, to pay the salaries or benefits of any permanent civil service position within the department. SEC. 3. Article 2.6 (commencing with Section 14140) is added to Chapter 2 of Part 5 of Division 3 of Title 2 of the Government Code, to read: Article 2.6. Architectural and Engineering Services 14140. The department shall implement Article XXII of the California Constitution by contracting with qualified private entities for architectural and engineering services, as defined in Section 4529.10, with respect to public works of improvement undertaken by the department, as follows: (a) A minimum of 15 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2016. (b) A minimum of 20 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2017. (c) A minimum of 25 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2018. (d) A minimum of 30 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2019. (e) A minimum of 35 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2020. (f) A minimum of 40 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2021. (g) A minimum of 45 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2022. (h) A minimum of 50 percent of the total annual value of architectural and engineering services required by the department shall be contracted to qualified private entities for the fiscal year beginning on July 1, 2023, and in subsequent fiscal years.