West contra costa unified school district complying with sb 293
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West Contra Costa Unified School District Complying with SB 293:. How do Districts retain more than 5% of the Contract Price for Retention? Presenter: Deidree Sakai. What is SB 293?.

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West Contra Costa Unified School District Complying with SB 293:

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West Contra Costa Unified School DistrictComplying with SB 293:

How do Districts retain more than 5% of the Contract Price for Retention?


Deidree Sakai

What is SB 293?

  • Senate Bill No. 293 (Padilla) amends statutes relating to retention, prompt payment requirements for general contractors, notice by claimants on payment bonds on contracts entered into after January 1, 2012.

  • SB 293 sunsets on January 1, 2016, unless extended by the legislature.

How does SB 293 affect school districts?

  • 5% retention on public works projects

    • Retention proceeds in excess of 5% of the progress payment/contract price are prohibited except under specified conditions. (Pub. Contract Code, § 7201.)

    • Existing law provides that the percentage of retention proceeds withheld cannot exceed the percentage specified in the contract between the public entity and the original contractor.

      • Current Standard: 10%

Complying with the Conditions for Retention Exceeding 5%

Retention may exceed 5% on specific projects where the governing body of the local public entity, or its designee, has approved or ratified by a majority vote during a properly noticed and normally scheduled public hearing prior to bid that the project is substantially complex and therefore requires a higher retention amount than 5%, and includes this finding and the actual retention amount in the bid documents.

(See Pub. Contract Code, § 7201(b)(4).)

Steps for Complying with SB 293 Conditions

  • Establish Criteria applicable to all school construction projects for determination of whether a specific project is “substantially complex”.

  • Delegate authority to make finding to Superintendent or Superintendent’s designee.

  • Adopt resolution at properly noticed, normally scheduled public hearing prior to bid.

  • Delegee makes finding whether specific projects are substantially complex based on the resolution .

  • Include the finding and actual retention amount in Notice to Bidders, General Conditions, Special Conditions, etc.

  • Board ratifies the designee’s actions when it awards or ratifies the contract.

Why are school construction projects substantially complex?

In comparison with other public works projects, school construction projects are:

  • Subject to higher safety standards;

  • Subject to higher levels of testing and inspection;

  • Subject to design approval by Division of State Architect; and/or

  • Have specialized systems and/or safety measures included to protect students, teachers, staff and/or visitors.

  • Thank you for your time and attention!

Deidree Y.M.K. Sakai dsakai@dwkesq.com415.543.4111

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