AB 2192 Approved: Bidding Thresholds Under CUPCCAA Set To Increase

10.17.2024

On September 29, 2024, Governor Gavin Newsom approved Assembly Bill (“AB”) 2192 (Carillo), which amends portions of the California’s Uniform Public Construction Cost Accounting Act (“CUPCCAA” or “Act”). (Pub. Contract Code § 22000 et seq.) The amendments, effective January 1, 2025, increase the bidding thresholds in Public Contract Code Section 22032, expand the statutory definition of “public projects,” and broaden the oversight authority of the California Uniform Construction Cost Accounting Commission (“Commission”).

California law generally requires competitive bidding for the award of contracts for public projects. School districts are generally required to let contracts for public projects by competitive bidding under Section 20111 of the Public Contract Code if the project requires an expenditure of $15,000 or more.

As an alternative to competitive bidding under Public Contract Code Section 20111, CUPCCAA authorized different procedures for public project contract bidding depending on the estimated cost of the project as follows:

The current provisions of the Act authorize public projects of $60,000 or less to be performed by public agency employees by force account, negotiated contract, or by purchase order.
Public projects of $200,000 or less are required to be let to contract by informal procedures.
Public projects of more than $200,000 are required to be let to contract by formal procedures.

Beginning January 1, 2025, AB 2192 increases the competitive bidding thresholds currently imposed by Sections 22032 and 22034 of the Public Contract Code as follows:

Public projects of $75,000 or less to be performed by public agency employees will be authorized by force account, negotiated contract, or purchase order.
Public projects of $220,000 or less may be let to contract by informal procedures.
Public contracts of more than $220,000 are to be let to contract by formal procedures.

If all of the bids received for the performance of a public contract exceed $220,000, the governing body of a public agency is authorized to award the contract at $235,000 or less to the lowest responsible bidder if the governing body determines, by resolution, that the public agency’s cost estimate was reasonable. AB 2192 also adds “installation[s]” to the definition of “public projects” contained in Section 22002 of the Public Contract Code.

AB 2192 also expands the Commission’s authority in administering the Act. The amended provisions of Section 22042 authorize review of the accounting procedures of any public agency participating in CUPCCAA where an interested party presents evidence that work undertaken by the public agency either: (1) has been split or separated into smaller work orders or projects; or (2) has exceeded the bidding thresholds or otherwise failed to meet the requirements of section 22032.

The changes AB 2192 will likely give public agencies more freedom in utilizing CUPCCAA as an alternative method of procurement. The increased bid thresholds factor in rising construction and project costs attributed in part to inflation.

If your agency requires guidance on the changes to CUPCCAA contained in this bill, please contact your AALRR attorney or the authors of this article.

Special thank you to Kevin Harris, FCPPG law clerk, for his contribution to the alert.