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Personal service contract reform goes through legislature once again

A Sacramento Democrat is promoting legislation that would impose an array of restrictions on how the state outsources personal services contracts, including when the state could fire IT and other contractors for poor performance or overspending.

The package of bills by Assemblyman Richard Pan comes a year after Gov. Jerry Brown signed a Pan measure giving state employee organizations the authority to review personal services contracts before the state executes them.

Pan’s push to further dictate contract terms is a concern for technology industry officials who fear such proposals would increase the hurdles facing employees planning an IT project.

"Rather than these protective bills, let’s collaborate to build a trained state workforce," said Russ Guarna, the vice president of state and local government affairs for TechAmerica. "Let’s help our business partners to be in a better position to be more successful."

TechAmerica opposed AB 906, which Brown signed into law in October. Guarna added that Pan’s followup bills would do little to protect the state.

AB 1575 would allow the state to fire contractors who fail to comply with set performance criteria, exceed annual costs outlined in contracts or don’t comply with local, state and federal laws, regulations and statutes.

The American Federation of State, County and Municipal Employees (AFSCME), which sponsored the bill, did not return a phone call from Techwire seeking comment. The union argues the bill "would hold outsourced public service providers accountable for their actions" and protect state agencies, according to an analysis by the Assembly Committee on Accountability and Administrative Review.

Pan’s office also did not return calls seeking comment. The bill remains in committee.

Pan’s AB 1574 would ban a state agency from entering into any contract that guarantees payments for services not provided.

The Assembly approved the bill by a 71-0 vote. It now heads to the Senate.

AB 1578, the third bill Pan has authored this year on personal services contracts, would create an online database of the total costs of state government personal service contracts. It has not yet been considered by the full Assembly.