Article 7 - Contracts with Nonprofit Veteran Service Agencies

Sections (3)

Amended by Stats. 2021, Ch. 756, Sec. 13. (AB 1574) Effective January 1, 2022.

(a)The administering agency for the California Disabled Veteran Business Enterprise Program is the Department of General Services, except in the case of contracts for professional bond services. The Department of General Services shall consult with the California Disabled Veteran Business Enterprise Program Advocate, appointed by the Secretary of the Department of Veterans Affairs pursuant to Section 999.11, on all matters relating to the California Disabled Veteran Business Enterprise Program. The Director of General Services shall adopt written policies and guidelines establishing a uniform process for state contracting that would provide a disabled veteran business enterprise participation incentive to bidders. The incentive program shall be used

by all state agencies when awarding contracts.

(b)The Department of Veterans Affairs shall do all of the following, as further described in Section 999.11:

(1)Establish a method of monitoring adherence to the goals specified in Sections 999.1 and 999.2.

(2)Promote the California Disabled Veteran Business Enterprise Program to the fullest extent possible.

(3)Maintain complete records of its promotional efforts.

(4)Establish a system to track the effectiveness of its efforts to promote the California Disabled Veteran Business Enterprise Program, which shall include regular, periodic surveys of newly certified

disabled veteran business enterprises to determine how they learned of the program, why they became certified, and what their experience with awarding departments has been.

(c)An awarding department shall not credit toward the department’s 3-percent goal state funds expended on a contract with a disabled veteran business enterprise that is not certified at the time of the award or does not meet and maintain the certification requirements.

(d)Upon completion of an awarded contract for which a commitment to achieve a disabled veteran business enterprise goal was made, an awarding department shall require the prime contractor that entered into a subcontract with a disabled veteran business enterprise to certify to the awarding department all of the following:

(1)The total amount the prime contractor received under the contract.

(2)The name and address of the disabled veteran business enterprise that participated in the performance of the contract and the contract number.

(3)The amount and percentage of work the prime contractor committed to provide to one or more disabled veteran business enterprises under the requirements of the contract and the amount each disabled veteran business enterprise received from the prime contractor.

(4)That all payments under the contract have been made to the disabled veteran business enterprise. Upon request by the awarding department, the prime contractor shall provide proof of

payment for the work.

(e)An awarding department shall keep the certification required pursuant to subdivision (d) on file.

(f)A person or entity that knowingly provides false information shall be subject to a civil penalty for each violation in the minimum amount of two thousand five hundred dollars ($2,500) and the maximum amount of twenty-five thousand dollars ($25,000). An action for a civil penalty under this subdivision may be brought by any public prosecutor in the name of the people of the State of California and the penalty imposed shall be enforceable as a civil judgment.

(g)After being awarded a contract, the prime contractor shall use the disabled veteran business enterprise subcontractors or suppliers

proposed in the bid or proposal to the state unless a substitution is requested and approved. The prime contractor shall request the substitution in writing to the awarding department and receive approval from both the awarding department and the Department of General Services in writing prior to the commencement of any work by the proposed subcontractor or supplier. A substitution pursuant to this subdivision shall additionally comply with regulations adopted by the Department of General Services.

(h)The administering agency shall adopt rules and regulations for the purpose of implementing this section.

§ 999.50

Added by Stats. 2004, Ch. 359, Sec. 1. Effective January 1, 2005.

It is the intent of the Legislature in enacting this article to encourage state agencies, cities, counties, districts, and other political subdivisions to purchase goods manufactured by, and services provided by, a nonprofit veteran service agency whenever it is both feasible to do so and the location of the nonprofit veteran service agency makes the purchases reasonably convenient.

§ 999.51

Added by Stats. 2004, Ch. 359, Sec. 1. Effective January 1, 2005.

(a)A nonprofit veteran service agency shall be eligible for certification as a small business under the Small Business Procurement and Contract Act, as described in Chapter 6.5 (commencing with Section 14835) of Part 5.5 of Division 3 of Title 2 of the Government Code, and may be granted a small business bid preference if it meets all of the following conditions:

(1)The goods or services meet the specifications and needs of the purchasing agency.

(2)The goods or services are purchased at a fair and reasonable price, as determined by the appropriate state or local agency.

(3)The nonprofit veteran service agency complies with all of the following requirements:

(A)The nonprofit veteran service agency shall employ veterans receiving services from the nonprofit veteran service agency for not less than 75 percent of the person-hours of direct labor required for the production of goods and the provision of services performed pursuant to a contract under this section.

(B)The nonprofit veteran service agency agrees to make those elections permitted of any nonprofit corporation under the Federal Insurance Contributions Act (26 U.S.C. Sec. 3103 et seq.) and the Unemployment Insurance Code in order to

provide social security and unemployment and disability benefits for its employees, commencing with its first contract or purchase order under this section and continuing thereafter. In the event that the nonprofit veteran service agency ceases to provide those benefits, any existing contract or purchase order under this section with the nonprofit veteran service agency is terminated and no further contracts or purchase orders shall be awarded to that nonprofit veteran service agency for the period of two years after the nonprofit veteran service agency ceases to provide the benefits.

(C)The nonprofit veteran service agency does not commit any unfair labor practices, as defined in the National Labor Relations Act, at Section 158 of Title 29 of the United States Code.

(D)The nonprofit veteran service agency abides by the provisions of the federal Fair Labor Standards Act of 1938

(29 U.S.C. Sec. 201 et seq.), the Walsh-Healy Public Contract Act (41 U.S.C. Sec. 35 et seq.), and the regulations of the Department of Industrial Relations (8 Cal. Code Regs. 1 et seq.).

(b)For purposes of this section:

(1)“Nonprofit veteran service agency” means a community-based organization that meets the following requirements:

(A)It is exempt from tax under Section 501(c)(3) of the Internal Revenue Code.

(B)Its principal purpose is to provide housing, substance abuse, case management, and employment training services for low-income veterans, disabled veterans, or homeless veterans and their families.

(2)“Direct labor” includes all work required for preparation, processing, and

packing of a good, or work directly relating to the performance of a service, excluding supervision, administration, inspection, and shipping.

(3)A veteran receiving services from the nonprofit veteran service agency shall be considered an employee when performing productive work.