Senate Bill 1397 simply requires the Prison Industry Authority (PIA), in procuring any goods of services, to comply with certain provisions of law that give preference to small businesses and establish participation goals for disabled veteran business enterprises in awarding contracts.

According to the Department of General Services, the Disabled Veteran Business Enterprise (DVBE) and Small Business (SB) Certification Programs were established to increase business opportunities for the DVBE and SB communities with the State of California; thereby stimulating the state's overall economy.  The programs are designed to help DVBEs and SBs compete on a more level playing field with certain advantages over other non-DVBEs and non-SBs for state contracts and purchases.  The Government Code establishes state agencies must have at least a 3% procurement contract goal for certified Disabled Veteran Business Enterprise (DVBE) and 5% bidding preference to certified Small Businesses:

http://www.pd.dgs.ca.gov/smbus/default.htm

 

However, PIA’s invitation for bids state “In the interest of achieving best value, PIA does NOT grant small business..preferences or require a DVBE Good Faith Effort in evaluating bids.”  The PIA’s website, under Contract & Procurement Services, states “Please beware that CALPIA does not provide any preferences to Small Business, Micro Business or Disabled Veteran Business Enterprises (DVBE).”

 PIA is self-supporting from the sale of its products and services therefore they do not receive an annual appropriation from the Legislature. PIA's revenue comes from the sale of its products and services to their customers, California State agencies.

 

 This bill simply deletes one provision from the Penal Code, which directs the PIA:  “To establish procedures governing the purchase of raw materials…”

This simple phrase has enabled the PIA to ignore such preferences and goals that other state agencies must abide by set forth in Government Code.  Therefore, this bill would require PIA to grant the same preferences to SB and meet the DVBE goal in awarding contracts just as all other State Agencies do.

 

 In Executive Order S-02-06, Governor Schwarzenegger expressed the positive impact small businesses have on the State of California’s economic prosperity and the need to increase small business participation in the State’s procurement and contracting processes.  This bill will also fulfill DGS’ stated objective of increasing business opportunities for DVBE and SB communities; thereby stimulating the state’s overall economy.

 

 

 California DVBE Alliance (Sponsor)

 None at this time

 

 Andrew Langley

Senator Negrete McLeod’s Office

(916) 651-4032

Andrew.Langley@sen.ca.gov