BILL NUMBER: AB 2353	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Knight

                        FEBRUARY 24, 2012

   An act to amend Section 4107 of the Public Contract Code, relating
to public contracts.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2353, as introduced, Knight. Public contracts: subcontracting:
substituting.
   The Subletting and Subcontracting Fair Practices Act generally
prohibits a prime contractor whose bid is accepted by an awarding
authority from substituting a person as subcontractor in place of the
subcontractor listed in the original bid, except that the awarding
authority may consent to the substitution of another person as a
subcontractor in specified situations. Existing law requires the
awarding authority, or its duly authorized officer, prior to approval
of the prime contractor's request for the substitution, to give
notice in writing to the listed subcontractor of the prime contractor'
s request to substitute and of the reasons for the request.
   This bill would require the awarding authority, or its duly
authorized officer, to give that written notice within 5 working days
of receiving notice from the prime contractor.
   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.  Section 4107 of the Public Contract Code is amended to
read:
   4107.  A prime contractor whose bid is accepted may not:
   (a)  (1)    Substitute a person as subcontractor
in place of the subcontractor listed in the original bid, except
that the awarding authority, or its duly authorized officer, may,
except as otherwise provided in Section 4107.5, consent to the
substitution of another person as a subcontractor in any of the
following situations: 
   (1) 
    (A)  When the subcontractor listed in the bid, after
having had a reasonable opportunity to do so, fails or refuses to
execute a written contract for the scope of work specified in the
subcontractor's bid and at the price specified in the subcontractor's
bid, when that written contract, based upon the general terms,
conditions, plans, and specifications for the project involved or the
terms of that subcontractor's written bid, is presented to the
subcontractor by the prime contractor. 
   (2) 
    (B)  When the listed subcontractor becomes insolvent or
the subject of an order for relief in bankruptcy. 
   (3) 
    (C)  When the listed subcontractor fails or refuses to
perform his or her subcontract. 
   (4) 
    (D)  When the listed subcontractor fails or refuses to
meet the bond requirements of the prime contractor as set forth in
Section 4108. 
   (5) 
    (E)  When the prime contractor demonstrates to the
awarding authority, or its duly authorized officer, subject to the
further provisions set forth in Section 4107.5, that the name of the
subcontractor was listed as the result of an inadvertent clerical
error. 
   (6) 
    (F)  When the listed subcontractor is not licensed
pursuant to the  Contractors   Contractors'
State  License Law. 
   (7) 
    (G)  When the awarding authority, or its duly authorized
officer, determines that the work performed by the listed
subcontractor is substantially unsatisfactory and not in substantial
accordance with the plans and specifications, or that the
subcontractor is substantially delaying or disrupting the progress of
the work. 
   (8) 
    (H)  When the listed subcontractor is ineligible to work
on a public works project pursuant to Section 1777.1 or 1777.7 of
the Labor Code. 
   (9) 
    (I)  When the awarding authority determines that a
listed subcontractor is not a responsible contractor.
    (2)    Prior to approval of the prime
contractor's request for the substitution, the awarding authority, or
its duly authorized officer, shall give notice in writing to the
listed subcontractor  within five working days of receiving
notice from the prime contractor  of the prime contractor's
request to substitute and of the reasons for the request. The notice
shall be served by certified or registered mail to the last known
address of the subcontractor. The listed subcontractor who has been
so notified has five working days within which to submit written
objections to the substitution to the awarding authority. Failure to
file these written objections constitutes the listed subcontractor's
consent to the substitution.
    (3)    If written objections are filed, the
awarding authority shall give notice in writing of at least five
working days to the listed subcontractor of a hearing by the awarding
authority on the prime contractor's request for substitution.
   (b) Permit a subcontract to be voluntarily assigned or transferred
or allow it to be performed by anyone other than the original
subcontractor listed in the original bid, without the consent of the
awarding authority, or its duly authorized officer.
   (c) Other than in the performance of "change orders" causing
changes or deviations from the original contract, sublet or
subcontract any portion of the work in excess of one-half of 1
percent of the prime contractor's total bid as to which his or her
original bid did not designate a subcontractor.