High Road Jobs in Transportation Public Contracting

California’s Public Contract Code, in Division 2, Part 1, Chapter 6.8, concerns certain public contracts and grants in the transportation sector. Section 6980 names the chapter the “High Road Jobs in Transportation-Related Public Contracts and Grants Pilot Program.”

Section 6981 contains fourteen legislative findings and declarations, including that “historically vulnerable groups have been disproportionately impacted by economic downturns. For example, for every one percentage point increase in the overall unemployment rate, there is a 1.8-percent increase in African American unemployment,” and that “it is essential that the state, in cooperation with the federal government, use all practical and commercially feasible means to promote the prompt and efficient development of energy sources that are renewable or that more efficiently use and conserve scarce energy resources.”

In addition, this section contain a statement that it is the “intent of the Legislature to support the creation of equitable high-quality transportation and related manufacturing and infrastructure jobs in California through the enactment and implementation of this chapter.”

Section 6982 contains definitions for the following terms: “bidder,” “contractor,” “covered public contract,” “high road job standards,” “relevant public agency,” “subcontractor,” and “zero-emission transit vehicle.”

Section 6983 provides that it is “the intent of the Legislature that a relevant public agency maximizes economic co-benefits by conditioning eligibility to be awarded a covered public contract on a commitment to comply with the labor standards established in this section,” and that “a covered public contract shall incorporate high road job standards designed to achieve the [nine specified] goals.”

In addition, a relevant public agency may incorporate additional high road factors into its scoring criteria for covered public contracts, including, but not limited to, a consideration of job creation, wages, and benefits. The Department of General Services was required to develop and publish policies, procedures, and requirements applicable to covered public contracts in the State Contracting Manual for the purpose of implementing this chapter.

Section 6984 provides that, beginning 12 months after an entity is awarded a covered public contract, the contractor is required to annually submit information that is necessary to demonstrate its compliance with the requirements to the relevant public agency. And, before receiving any final payment on a covered public contract, a contractor is required to submit a final report to the relevant public agency that demonstrates its compliance with the requirements for the duration of the covered public contract.

If a contractor fails to comply with the reporting requirements, for each missed report the relevant public agency must withhold $10,000 in payment to the contractor, or the full payment to the contractor if the amount due is less than $10,000, until the contractor takes steps to cure the defect. A contractor that fails to comply with the reporting requirements is required, after notice, to be allowed to cure the defect within 30 calendar days.

This section does not limit the availability of standard breach of contract remedies if a contractor fails to comply with the requirements including, but not limited to, termination of the covered contract.

Section 6985 includes a dozen legislative declarations including that “the effects of climate change have already cost the state billions of dollars and will only continue to increase if we do not take immediate and decisive action to cut emissions” and that “the transportation sector in California accounts for 41 percent of the state’s total carbon emissions.”

Section 6986 is a repeal clause that this chapter remains in effect only until January 1, 2028, and as of that date is repealed.