SB1_1995
BILL NUMBER: SB 1	AMENDED	08/29/95
	BILL TEXT

	AMENDED IN ASSEMBLY   AUGUST 29, 1995
	AMENDED IN ASSEMBLY   JULY 18, 1995

INTRODUCED BY  Senator Alquist
   (Principal coauthors:  Assembly Members Bowen and Cunneen)
   {+ (Coauthors:  Senators Campbell and Kopp) +}

                        DECEMBER 5, 1994

   An act to repeal, add, and repeal Chapter 7 (commencing with
Section 11700) of Part 1 of Division 3 of Title 2 of the Government
Code, {+ and to amend Sections 12101, 12102, 12103, and 12105 of the
Public Contract Code, +} relating to information technology.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1, as amended, Alquist.  Department of Information Technology.
   There is in existing law an Office of Information Technology in
the Department of Finance which is charged with identifying new
applications for information technology, improving productivity and
service to clients, and assisting agencies in designing and
implementing the use of information technology.  The Office of
Information Technology operates under the direction of the Director
of the Office of Information Technology, who is prescribed specified
responsibilities.
   This bill would replace the Office of Information Technology with
the Department of Information Technology and that department would be
managed by the Director of Information Technology who would have
prescribed responsibilities.  The Department of Information
Technology would be charged with providing leadership, guidance, and
oversight of information technology in state government.  This bill
would require the Department of Information Technology or its
director, among other things, to do all of the following:
   (1)  Develop plans and policies to support and promote the
effective application of information technology within state
government.
   (2) Establish policies and procedures to ensure that major {+
state information technology +} projects are scheduled and funded in
phases.
   (3) Consolidate existing data centers, if deemed in the best
interest of the state.
   (4) Report to the Governor and the Legislature, as specified.
   (5) Form user committees and advisory committees, as specified.
{+
   The bill would also make various conforming changes. +}
   Vote:  majority.  Appropriation:  no.  Fiscal committee:  yes.
State-mandated local program:  no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Chapter 7 (commencing with Section 11700) of Part 1 of
Division 3 of Title 2 of the Government Code is repealed.
  SEC. 2.  Chapter 7 (commencing with Section 11700) is added to Part
1 of Division 3 of Title 2 of the Government Code, to read:

      CHAPTER 7.  INFORMATION TECHNOLOGY
      Article 1.  Intent and Definitions

   11700.  (a) The Legislature finds that information technology is
an indispensable tool of modern government for the rapid and
efficient handling of data, records, communication, and transactions,
and for assisting decisionmakers in carrying out their tasks and
responsibilities at all levels of government.
   (b) The Legislature finds that advances in information technology,
such as automated office systems, personal computers, electronic
mail, and others, have the potential to increase the productivity,
efficiency, and responsiveness of the state's operations.  The
Legislature finds that a need exists to facilitate the productive
application of information technology to state programs, and to do so
in a manner that significantly improves the return on the state's
investment in this technology.  Therefore, the Legislature intends
that the Department of Information Technology created by this
chapter, shall improve the state's ability to apply information
technology effectively, and {- to -} provide guidance and leadership
to state agencies in identifying, designing, and implementing these
applications, and where feasible, promote phased implementation and
funding of large and complex projects.
   11701.  It is the intent of the Legislature to create the
Department of Information Technology that shall do all of the
following:
   (a) Provide statewide guidance to state agencies regarding
acquisition, management, and appropriate use of information
technology to improve operational productivity, reduce the cost of
government, enhance service to customers, lower the cost and risk to
taxpayers when implementing information technology, and expand the
use of information technology to make government more accessible to
the public.
   (b) Develop specific statewide strategies, policies, and
processes, including oversight, to improve the state's overall
management of information technology; improve the state's overall
management of information technology projects; improve the
development and contract management of information technology
acquisitions; guide state agencies in the acquisition, management,
and use of information technology; and provide guidance to all state
agencies to ensure that {+ the agency's +} information technology
direction is consistent with the agency's mission, business plan, and
a results-oriented management policy.
   (c) Develop statewide policies and plans for information
technology that recognize the interrelationships and impact of state
activities on local governments, including local school systems,
private companies that supply needed goods and services to agencies
{- of -} {+ and +} the federal government, and require individual
state agency plans be aligned with statewide policies and plans.
   (d) Develop appropriate policies and requirements for risk
management and for sharing risk and benefits with the private sector
in the acquisition of information technology products and services.
   (e) Develop policies, goals, and objectives for one-time
collection of data, allowing its use by all appropriate agencies
without jeopardizing the security or confidentiality of information
as provided by statute or the constitutional protection of individual
rights to privacy.
   (f) Establish and maintain criteria to be followed by state
government in participating with private industry, and federal,
state, and local government in demonstrating or developing advanced
information technologies.
   (g) Update continuously policies developed in carrying out the
intent of this chapter for inclusion in the State Administrative
Manual to reflect changing state needs related to information
technology.
   (h) Develop policies and standards to improve the acquisition and
management of information technology projects in consultation with
the Department of General Services, Office of Procurement.
   11702.  The following definitions apply for the purposes of this
chapter, unless the context requires otherwise:
   (a) "Advanced information technologies" includes, but is not
limited to, technologies of a nature providing opportunities of value
to the state, and technologies to which the state has limited access
because of the lack of previous application to government processes
and that limit the competitiveness of the acquisition due to the
advanced nature of the technology.
   (b) "Agency" means agency, department, board, commission, data
center, or any other state entity.  {-
   (c) "CIO" means chief information officer. -} {-
   (d) -} {+
   (c) +} "Department" means the Department of Information
Technology.  {-
   (e) -} {+
   (d) +} "Director" means the state chief information officer and
the Director of Information Technology, and may be used
interchangeably.  {-
   (f) -} {+
   (e) +} "Information technology" includes, but is not limited to,
all electronic technology systems and services, automated information
handling, system design and analysis, conversion of data, computer
programming, information storage and retrieval, {+ telecommunications
which include +} voice, video, and data communications, requisite
system controls, simulation, electronic commerce, and all related
interactions between people and machines.  {-
   (g) -} {+
   (f) +}"Infrastructure" consists of information technology
equipment, software, communications networks, facilities, and staff.
Specifically included in statewide infrastructure are data centers
and wide-area networks with their associated management and support
capabilities.  {-
   (h) "Telecommunications" means all central office-based leased
communications systems equipped with primary station lines, capable
of receiving in-dialed voice and data communications and capable of
transmitting out-dialed voice and data communications and any
customer premised equipment, software, and installation costs
necessary for utilization by the state. -}

      Article 2.   Department of Information Technology

   11710.  (a) There is hereby created in the executive branch the
Department of Information Technology, that shall be managed by the
Director of Information Technology, who shall be appointed by the
Governor, with the consent of the Senate, and who shall serve at the
pleasure of the Governor.
   (b) The department, among other duties, shall perform the
statutory duties and responsibilities of the former Office of
Information Technology.  Any reference in any law to the Office of
Information Technology or the director of that office shall be
considered a reference to the Department of Information Technology
and the Director of Information Technology, as the case may be,
unless the context otherwise requires.
   (c) Subject to the State Civil Service Act (Part 2 (commencing
with Section 18500) of Division 5 of Title 2 of the Government Code),
the {- CIO -} {+ director +} shall appoint any other assistants and
other employees as are necessary for the administration of the
department and shall prescribe their duties.
   (d) The department shall provide leadership, guidance, and
oversight of information technology in state government, including,
but not limited to, all of the following:
   (1) Development of statewide vision, strategies, {+ plans, +}
policies, requirements, standards, and infrastructure.
   (2) Implementation of efficient, effective, and timely information
technology acquisition and project management processes.
   (3) Identification of available information technology resources
from both public and private sectors.
   (4) Development and implementation of an information technology
equipment and software acquisition strategy that moves the state
steadily to an architecture to provide maximum practical
compatibility to facilitate information sharing among all computing
systems in state government.
   (5) Promotion of reforms in information technology personnel
classifications and in systems and procedures that reward skill in
meeting business needs and facilitation of change with effective
application of information technology.
   (e) The Department of Information Technology shall have possession
and control of all relevant records and papers held for the benefit
or use of the former Office of Information Technology in the
performance of its statutory duties, powers, purposes, and
responsibilities.
   11711.  The director shall be responsible for all of the
following:
   (a) Developing plans and policies to support and promote the
effective application of information technology within state
government as a means of saving money, increasing employee
productivity, and improving state services to the public, including
public electronic access to state information.
   (b) Overseeing the management of information technology in state
agencies, the development and management of information technology
projects, and acquisition of information technology to ensure
compliance with statewide strategies, policies, and standards.
   (c) Preparing annual reports to the Governor and the Legislature
as to the status and result of the state's specific information
technology plans.
   (d) Developing and maintaining a computer based file {+ , for use
by the department and the Legislature, +} of all information
technology projects for which a feasibility study report has been
approved {- for use by the department and the Legislature. -} {+. +}
   (e) Recommending to the Governor and Legislature changes needed in
state policies and laws to accomplish the purposes of this chapter.

   (f) Identifying which applications of information technology
should be statewide in scope, and ensure that these applications are
not developed independently or duplicated by individual state
agencies.
   (g) Establishing policies and procedures, where appropriate, to
ensure that major projects are scheduled and funded in phases and
that authority to proceed to the next phase of a project will be
contingent upon successful completion of the prior phase.  The
policies and procedures to be developed by the director shall include
the identification of one or more specific results deliverable for
each phase that will provide the basis for assessing the extent to
which a phase has been completed successfully.
   11712.  The director is vested with the authority to do the
following:
   (a) Review proposed agency information technology projects for
compliance with statewide strategies, policies, and standards,
including project management methods and standards.
   (b) Grant or withhold approval to initiate agency information
technology projects based upon the review performed in accordance
with subdivision (a).  {+ The director shall consult with the
affected agencies and the involved control and service agencies, as
appropriate, when granting or withholding approval on information
technology projects.  The director shall make the final decision to
initiate, suspend, or terminate an information technology project. +}

   (c) Monitor agency information technology projects to ensure
continued compliance with statewide strategies, policies, and
standards, and project management methods and standards.
   (d) Make recommendations for remedial measures to be applied to
agency information technology projects in order to achieve compliance
with statewide strategies, policies, and standards, and proper
project management methods and standards.  Remedial measures include,
but are not limited to, use of independent validation and
verification methodologies based on engineering principles, conducted
on an independent basis, by practitioners with recognized expertise
and experience.
   (e) Suspend {+ , reinstate, +} or terminate projects after
consultation with the affected agencies, and the involved control and
{- service agencies, until the time remedial measures are identified
or put in place to the satisfaction of the chief information
officer, the affected agencies, and the control and service agencies
involved. -} {+ service agencies. +}
   (f) Develop policies and requirements for carrying out the
responsibilities of this article for publication in the State
Administrative Manual, or distribution by management memo.
   11713.  The director shall continue to develop plans and policies
in a coordinated fashion regarding all of the following:
   (a) The state data centers, including the optimum size and degree
of centralization of the data centers.
   (b) Information technology management personnel, including the
training and qualifications of those personnel.
   (c) Telecommunications networks, including both wide and local
area networks.
   (d) Public access, via telecommunications, to {- nonconfidential
data -} {+ public records, indexes, and data bases +} maintained in
computer accessible files in conformance with applicable laws
relating to confidentiality and privacy of information.  {+
   11714.  The role of the Department of Finance regarding the
approval of information technology projects shall be limited to the
approval of expenditure of funds on information technology projects.
+}

      Article 3.  State Agency Responsibilities

   11720.  Subject to the authority of the office as set forth in
this chapter, the head of each agency is responsible for the
management of information technology in the agency that he or she
heads, including, but not limited to, (a) the designation of an
individual as the person responsible for information technology
application and management within the agency; (b) the establishment
of information technology strategies that support the accomplishment
of the agency mission, business strategies, and objectives; (c) the
justification of proposed information technology projects in terms of
costs and benefits, as well as consistency with agency mission and
statewide strategies, policies, requirements, and standards; (d) the
management of information technology development and acquisition
projects and the qualifications of project staff; and (e) the
management of all agency information processing and communications
activities.  The head of each agency has responsibility over all
information collected, processed, stored, or used by the agency that
he or she heads.

      Article {- 5. -} {+ 4. +}  Reporting Requirements

   11725.  (a) It is the intent of the Legislature that the
reorganization and specific requirements specified in this chapter be
implemented as quickly as possible.  However, the Legislature
recognizes that in order for compliance to be most effective, careful
planning and execution are essential.
   (b) The director shall provide to the Joint Legislative Budget
Committee and the appropriate policy and fiscal committees of the
Assembly and Senate, on or before July 1, 1996, a written progress
report of compliance to date and a plan and schedule for obtaining
compliance for all other requirements of this chapter.  Thereafter,
the director shall report in writing annually by December 1 to those
legislative committees of the progress in implementing this plan.
This annual report shall include a statewide plan for information
technology and support of state programs.
   (c) Provide to the Governor, the Chairperson of the Joint
Legislative Budget Committee, and the chairpersons of the appropriate
policy and fiscal committees of the Assembly and Senate, the
following reports:
   (1) By October 1, 1996, a plan for implementing the
recommendations contained in the September 1994 report to the
Governor by the Task Force on Government Technology Policy and
Procurement.  The plan shall include a target implementation
schedule, a preliminary estimate of costs and benefits, where these
estimates are practical, and justification for any decision not to
implement specific task force recommendations.
   (2) By July 1, 1997, a preliminary assessment of the feasibility
of consolidating the state's information technology activities
including those conducted by agencies on their own behalf, as well as
those conducted by data centers.  If the preliminary assessment
indicates consolidation is feasible and cost-effective, the report
shall contain a preliminary formal assessment and decision plan,
including a schedule.
   (3) By January 1, 1997, a report outlining a method whereby the
public may access by remote access only nonconfidential public
records, indexes, and data bases contained on a state agency network.

   11726.  Feasibility study reports, special project reports, and
postimplementation evaluation reviews for information technology
projects, if and when required, shall include in the front of the
document a summary disclosing the following information:
   (a) For feasibility study reports, the estimated project cost and
benefits for the selected solution, the estimated start and
completion dates, and the estimated number of months required to
implement the project.
   (b) For special project reports, the original estimates of cost,
benefits, and schedule, the new estimates of cost, benefits and
schedule, and where applicable, the estimated cost, benefits and
schedule reflected in the most recent special project report.
   (c) For postimplementation evaluation reports, an analysis of the
original estimated versus actual costs, benefits, and schedule.

       Article {- 7. -} {+ 5. +}  Management of Information
Technology Services

   11730.  It is the intent of the Legislature that the director
shall be the state's advocate in the exploitation of information
technology to increase the effectiveness and efficiency of government
information technology services in program and support areas.  The
department shall adopt policies and procedures to carry out its
advocacy role and shall publish and maintain them in the State
Administrative Manual.

      Article {- 9. -} {+ 6. +}  User Committee

   11735.  The {- CIO -} {+ director +} shall form an information
technology advisory committee or committees consisting of
representatives of state agencies. These committees shall advise the
{- CIO -} {+director +} with respect to the management of information
technology, including critical success factors for successful use
and management of information technology and recommend changes in
policy, both legislative and administrative, necessary to achieve
successful information technology management.
   11736.  The advisory committee {+ or committees +} shall prepare a
written agenda for each of its meetings, and the advisory committees'
finding and recommendation shall be in writing.  These written
documents shall be available to interested parties upon request.
   11737.  The representatives appointed to the user committee or
committees shall be selected from individuals designated by the
agency in accordance with Section 11720, or the most senior manager
responsible for information technology in the agency.  Additional
appointments may be made at the discretion of the {- CIO -} {+
director +} .
   11738.  The {- CIO -} {+ director +} shall form an information
technology advisory commission to provide advice to the {- CIO -} {+
director +} on information technology issues.  Commission advice {- ,
-} shall include, but is not limited to, long-term information
technology trends and strategies, key information technology policy
issues, strategic technologies that should be pursued, and practices
in both public and private organizations.
   11739.  Appointments to the advisory commission shall be made by
the {- CIO -} {+ director +} .  Commission members shall utilize
their knowledge, experience, and expertise in all matters of
information technology, including new development and trends,
acquisition, planning, implementation, and management. Members are to
be selected from the private sector, academic sector, nonprofit
organizations, and other governmental sectors.  Members of the
commission shall serve without compensation but may be reimbursed for
actual and necessary travel expenses.
      Article {- 10. -} {+ 7. +}  Data Centers

   11751.  There is in the Department of Justice the Hawkins Data
Center. The Hawkins Data Center shall be under the supervision of a
data center director who shall be appointed by the Attorney General,
in consultation with the Director of Information Technology, pursuant
to civil service.  The data center shall be subject to consolidation
with other information technology centers in accordance with this
chapter, if the Director of Information Technology deems it in the
best interest of the state.  The data center director shall be
responsible for the efficient and effective management and operation
of the data center.
   11752.  There is in the Business, Transportation and Housing
Agency the Stephen P. Teale Data Center.  The Stephen P. Teale Data
Center shall be under the supervision of a data center director who
shall be appointed by the Governor, in consultation with the Director
of Information Technology, subject to confirmation by the Senate and
serve at the pleasure of the Governor.  The Stephen P. Teale Data
Center shall be subject to consolidation with other information
technology centers in accordance with this chapter, if the Director
of Information Technology deems it in the best interest of the state.
The Director of the Stephen P. Teale Data Center shall receive a
salary approved by the Department of Personnel Administration.  The
data center director shall be responsible for the efficient and
effective management and operation of the data center.  The data
center director shall continue to communicate regularly with the
Director of Information Technology regarding future needs of the
center and the likely impact of emerging technologies.
   11753.  There is in the Health and Welfare Agency the Health and
Welfare Agency Data Center.  The Health and Welfare Agency Data
Center shall be under the supervision of a data center director who
shall be appointed by the Secretary of the Health and Welfare Agency,
in consultation with the Director of Information Technology pursuant
to civil service.  The Health and Welfare Agency Data Center shall
be subject to consolidation with other information technology centers
in accordance with this chapter, if the Director of Information
Technology deems it in the best interest of the state. The data
center director shall be responsible for the efficient and effective
management and operation of the data center.
   11754.  There is in the State Treasury, the Stephen P. Teale Data
Center Revolving Fund, hereafter referred to as the "TDC Fund," which
fund is continuously appropriated for the purposes of this chapter,
and the fund shall be continuously utilized without regard to fiscal
years for the payment of expenses incurred by the Stephen P. Teale
Data Center.  Moneys available in the TDC Fund, not to exceed a total
of 1 percent of the Stephen P. Teale Data Center's current fiscal
year budget, may be allocated by the director to projects that
demonstrate or develop advanced information technologies as solutions
to information processing problems.
   The expenditures for these allocations shall be provided for out
of the unencumbered surplus of the TDC Fund.  There shall be no
expenditure in the event that there is no unencumbered surplus in any
particular fiscal year.
   The TDC Fund shall consist of the following:
   (a) All moneys appropriated by the Legislature for the fund in
accordance with law.
   (b) All moneys received into the State Treasury from any source
whatever in payment of electronic data processing services rendered
by the Stephen P.  Teale Data Center or for other services rendered
by the Stephen P. Teale Data Center.
   (c) All moneys from outstanding balances of prior fiscal years
which have not reverted to the General Fund.
   (d) The balance remaining in the TDC Fund at the end of any fiscal
year whether the moneys received are from an appropriation or from
payments for services rendered.
   If the balance remaining in the TDC Fund at the end of any fiscal
year exceeds 25 percent of the Stephen P. Teale Data Center's current
fiscal year budget, the billing rates for services rendered shall be
adjusted downward for the following fiscal year.
   If the Stephen P. Teale Data Center is consolidated with other
state information technology centers, the TDC Fund shall cease to
exist and any remaining funds shall be distributed in accordance with
Section 16304.9.
   11755.  There is in the State Treasury, the Health and Welfare
Agency Data Center Revolving Fund, hereafter referred to as the "HWDC
Fund," which fund is continuously appropriated for the purposes of
this chapter.  Moneys in the fund shall be continuously utilized
without regard to fiscal years for the payment of expenses incurred
by the Health and Welfare Agency Data Center. Moneys available in the
HWDC Fund, not to exceed a total of 1 percent of the Health and
Welfare Agency Data Center's current fiscal year budget, may be
allocated by the director to projects that demonstrate or develop
advanced information technologies as solutions to information
processing problems.
   The expenditures for these allocations shall be provided for out
of the unencumbered surplus of the HWDC Fund.  There shall be no
expenditure in the event that there is no unencumbered surplus in any
particular fiscal year.
   The HWDC Fund shall consist of the following:
   (a) All moneys appropriated by the Legislature for the fund in
accordance with law.
   (b) All moneys received into the State Treasury from any source
whatever in payment of electronic data processing services rendered
by the Health and Welfare Agency Data Center or for other services
rendered by the Health and Welfare Agency Data Center.
   (c) All moneys from outstanding balances of prior fiscal years
which have not reverted to the General Fund.
   (d) The balance remaining in the HWDC Fund at the end of any
fiscal year whether the moneys received are from an appropriation or
from payments for services rendered.
   If the balance remaining in the HWDC Fund at the end of any fiscal
year exceeds 25 percent of the Health and Welfare Agency Data Center'
s current fiscal year budget, the excess amount shall be used to
reduce the billing rates for services rendered during the following
fiscal year.
   If the Health and Welfare Agency Data Center is consolidated with
other state information technology centers, the HWDC Fund shall cease
to exist and any remaining funds shall be distributed in accordance
with Section 16304.9.

      Article {- 15. -} {+ 8. +}  Data Security and Confidentiality

   11770.  (a) The Department of Information Technology shall do all
of the following:
   (1) Develop the policies and standards to be followed in providing
for the confidentiality of information.
   (2) Develop policies necessary to provide for the security of the
state's informational and physical assets.
   (3) Develop policies to provide for the preservation of the state'
s information processing capability.
   (4) Coordinate research and identify solutions to problems
affecting information security.
   (5) Review and approve personal services contracts for information
security consulting services.
   (6) Represent the state to the federal government, other agencies
of state government, local government entities, and private industry
on issues that have statewide impact on information security.
   (7) Develop policies and monitor state agencies to ensure that
agency business operations will continue to function in the event of
a disaster.
   (8) Review and advise on security plans concerning the location
and construction of information processing facilities for state
agencies.
   (9) Prepare policies and procedures for inclusion in the State
Administrative Manual for use by state agencies regarding the
applicable law relating to confidentiality and privacy of, and public
access to, information.
   (b) State agencies shall notify the department of all incidents
involving the unauthorized intentional damage to, or modification or
destruction of, electronic information, and the damage to, or
destruction or theft of, data processing equipment, or the
intentional damage to, or destruction of, information processing
facilities.  The department shall investigate any incident it deems
necessary.
   (c) This section shall not apply to the California State Lottery.
   11771.  The chief executive officer of each state agency that
uses, receives, or provides information technology services shall
designate an information security officer who shall be responsible
for implementing state policies and standards regarding the
confidentiality and security of information pertaining to his or her
respective agency.  The policies and standards shall include, but are
not limited to, strict controls to prevent unauthorized access to
data maintained in computer files, program documentation, data
processing systems, data files, and data processing equipment
physically located in the agency.
   11772.  Any contract entered into by any state agency that
includes provisions for information technology systems design,
programming, documentation, conversion, equipment maintenance, and
similar aspects of information technology services shall contain a
provision requiring the contractor and all of his or her staff
working under the contract to maintain all confidential information
obtained as a result of the contract as confidential and to not
divulge that information to any other person or entity.

      Article {- 16. -} {+ 9. +}  Disaster Recovery Planning

   11773.  Each state agency shall develop and continually update a
disaster recovery plan with respect to information technology.  Each
agency shall establish a disaster recovery planning team to develop
the disaster recovery plan and to administer the plan's
implementation.  In developing the plan, the disaster recovery
planning team shall do all of the following:
   (a) Consider the organizational, managerial, and technical
environments in which the disaster recovery plan must be implemented.

   (b) Assess the types and likely parameters of disasters most
likely to occur and the resultant impacts on the agency's ability to
perform its mission.
   (c) List protective measures to be implemented in anticipation of
a disaster, natural or manmade.  Protective measures listed shall be:

   (1) Those protective measures determined to be most
cost-effective; and
   (2) Identified through the risk management process for information
technology referred to in the State Administrative Manual.
   11774.  Each state agency shall file a copy of its disaster
recovery plan with the Department of Information Technology by
January 31 of each year. The Department of Information Technology
shall review and coordinate disaster planning with respect to
information technology for all state agencies.  If a state agency
employs the services of a state data center, the agency must also
provide the data center with a copy of its disaster recovery plan.
   11775.  For purposes of this article, "disaster recovery planning"
includes, but is not limited to, the documentation, plans, policies,
and procedures that are required to restore normal operation to a
state agency impacted by manmade or natural disaster.

      Article {- 17. -} {+ 10. +}  Applicability

   11780.  The provisions of this chapter shall not apply to the
University of California, the California State University, the State
Compensation Insurance Fund, the community college districts,
agencies provided for by Article VI of the California Constitution,
or the Legislature.

      Article {- 18. -} {+ 11. +}  Repeal of Chapter

   11785.  This chapter shall become inoperative on July 1, 2000,
and, as of January 1, 2001, is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 2001, deletes
or extends the dates on which it becomes inoperative and is
repealed.  {+
  SEC. 3.  Section 12101 of the Public Contract Code is amended to
read: +}
   12101.  It is the intent of the Legislature that policies
developed by the Department of {- Finance -} {+ Information
Technology +} and procedures developed by the Department of General
Services in accordance with Section 12102 provide for:
   (a) The expeditious and value-effective acquisition of electronic
data processing and telecommunications goods and services to satisfy
state requirements.
   (b) The acquisition of electronic data processing and
telecommunications goods and services within a competitive framework.

   (c) The delegation of authority by the Department of General
Services to each state agency that has demonstrated to the department'
s satisfaction the ability to conduct value-effective electronic data
processing and telecommunications goods and services acquisitions.
   (d) The exclusion from state bid processes, at the state's option,
of any vendor having failed to meet prior contractual requirements
related to electronic data processing or telecommunications goods and
services.
   (e) The review and resolution of protests submitted by a vendor or
vendors with respect to any electronic data processing or
telecommunications goods and services acquisitions.   {+
  SEC. 4.  Section 12102 of the Public Contract Code is amended to
read: +}
   12102.  The Department of {- Finance -} {+ Information Technology
+} and the Department of General Services shall maintain, in the
State Administrative Manual, policies and procedures governing the
acquisition and disposal of electronic data processing and
telecommunications goods and services.
   (a) Acquisition of electronic data processing and
telecommunications goods and services shall be conducted through
competitive means, except when the Director of General Services
determines that (1) the goods and services proposed for acquisition
are the only goods and services which can meet the state's need, or
(2) the goods and services are needed in cases of emergency where
immediate acquisition is necessary for the protection of the public
health, welfare, or safety.  The acquisition mode to be used and the
procedure to be followed shall be approved by the Director of General
Services.  The Department of General Services shall maintain, in the
State Administrative Manual, appropriate criteria and procedures to
ensure compliance with the intent of this chapter.  These criteria
and procedures shall include acquisition and contracting guidelines
to be followed by state agencies with respect to the acquisition of
electronic data processing and telecommunications goods and services.
  These guidelines may be in the form of standard formats or model
formats.
   (b) Contract awards for all large-scale systems integration
projects shall be based on the proposal that provides the most
value-effective solution to the state's requirements, as determined
by the evaluation criteria contained in the solicitation document.
Evaluation criteria for procurement of electronic data processing and
telecommunications services, including systems integration, shall
provide for the selection of a vendor on an objective basis not
limited to cost alone.
   (1) The Department of General Services shall invite active
participation, review, advice, comment, and assistance from the
private sector and state agencies in developing procedures to
streamline and to make the acquisition process more efficient,
including but not limited to consideration of comprehensive
statements in the request for proposals of the business needs and
governmental functions, access to studies, planning documents,
feasibility study reports and draft requests for proposals applicable
to procurements, minimizing the time and cost of the proposal
submittal and selection process, and development of a procedure for
submission and evaluation of a single rather than multiple proposals.

   (2) Solicitations for acquisitions based on evaluation criteria
other than cost alone shall provide that sealed cost proposals shall
be submitted and that they shall be opened at a time and place
designated in the solicitation for bids and proposals.  Evaluation of
all criteria, other than cost, shall be completed prior to the time
designated for public opening of cost proposals, and the results of
the completed evaluation shall be published immediately before the
opening of cost proposals.  The state's contact person for
administration of the procurement shall be identified in the
solicitation for bids and proposals, and that person shall execute a
certificate under penalty of perjury, which shall be made a permanent
part of the official procurement file, that all cost proposals
received by the state have been maintained sealed and under lock and
key until the time cost proposals are opened.
   (c) The acquisition of hardware purchased independently of a
system integration project may be made on the basis of lowest cost
meeting all other specifications.
   (d) Whenever an acquisition is based upon cost alone, so that the
award of a contract, purchase order, or delegated purchase order is
made to the lowest responsible bidder meeting the specifications, the
5 percent small business preference provided for in Chapter 6.5
(commencing with Section 14835) of Part 5.5 of Division 3 of Title 2
of the Government Code and the regulations implementing that chapter
shall be accorded to all qualifying small businesses.
   (e) For all transactions formally advertised, evaluation of
bidders' proposals for the purpose of determining contract award for
electronic data processing and telecommunications goods shall provide
for consideration of a bidder's best financing alternatives,
including lease or purchase alternatives, if any bidder so requests,
not less than 30 days prior to the date of final bid submission,
unless the acquiring agency can prove to the satisfaction of the
Department of General Services that a particular financing
alternative should not be so considered.
   (f) Acquisition authority may be delegated by the Director of
General Services to any state agency which has been determined by the
Department of General Services to be capable of effective use of
that authority.  This authority may be limited by the Department of
General Services.  Acquisitions conducted under delegated authority
shall be reviewed by the Department of General Services on a
selective basis.
   (g) To the extent practical, the solicitation documents shall
provide for a contract to be written to enable acquisition of
additional items to avoid essentially redundant acquisition processes
when it can be determined that it is economical to do so.
   Further, it is the intent of the Legislature that, if a state
electronic data processing advisory committee or a state
telecommunications advisory committee is established by the Governor,
the Director of {- Finance -} {+ Information Technology +} , or the
Director of General Services, the policies and procedures developed
by the Director of {- Finance -} {+ Information Technology +} and the
Director of General Services in accordance with this chapter shall
be submitted to that committee, including vendor representatives, for
review and comment, and that the comment be considered by both
departments prior to the adoption of any policy or procedure.  It is
also the intent of the Legislature that this section shall apply to
the Department of General Services Information Technology Customer
Council.
   (h) Protest procedures shall be developed to provide bidders an
opportunity to protest formally with respect to any acquisition
conducted in accordance with this chapter.  The procedures shall
provide that protests must be filed no later than five working days
after the issuance of an intent to award.  Authority to protest may
be limited to participating bidders.  The Director of General
Services, or a person designated by the director, may consider and
decide on initial protests.  A decision regarding an initial protest
shall be final.  If prior to the last day to protest, any vendor who
has submitted an offer files a protest with the department against
the awarding of the contract or purchase order on the ground that his
or her bid or proposal should have been selected in accordance with
the selection criteria in the solicitation document, the contract or
purchase order shall not be awarded until either the protest has been
withdrawn or the State Board of Control has made a final decision as
to the action to be taken relating to the protest.  Within 10
calendar days after filing a protest, the protesting vendor shall
file with the State Board of Control a full and complete written
statement specifying in detail the grounds of the protest and the
facts in support thereof.
   (i) Electronic data processing and telecommunications goods which
have been determined to be surplus to state needs shall be disposed
of in a manner which will best serve the interests of the state.
Procedures governing the disposal of surplus goods may include
auction or transfer to local governmental entities.
   (j) A vendor may be excluded from bid processes if the vendor's
performance with respect to a previously awarded contract has been
unsatisfactory, as determined by the state in accordance with
established procedures which shall be maintained in the State
Administrative Manual.  This exclusion may not exceed 360 calendar
days for any one determination of unsatisfactory performance.  Any
vendor excluded in accordance with this section shall be reinstated
as a qualified vendor at any time during this 360-day period, upon
demonstrating to the department's satisfaction that the problems
which resulted in the vendor's exclusion have been corrected.   {+
  SEC. 5.  Section 12103 of the Public Contract Code is amended to
read: +}
   12103.  In addition to the mandatory requirements enumerated in
Section 12102 the acquisition policies  developed and maintained by
the Department of {- Finance -} {+ Information Technology +} and
procedures developed and maintained by the Department of General
Services in accordance with this chapter may provide for {+ the
following +} :
   (a) Price negotiation with respect to contracts entered into in
accordance with this chapter.
   (b) System or equipment component performance, or availability
standards, including an assessment of the added cost to the state to
receive contractual guarantee of a level of performance.
   (c) Requirement of a bond or assessment of a cost penalty with
respect to a contract or consideration of a contract offered by a
vendor whose performance has been determined unsatisfactory in
accordance with established procedures maintained in the State
Administrative Manual as required by Section 12102.   {+
  SEC. 6.  Section 12105 of the Public Contract Code is amended to
read: +}
   12105.  The Department of General Services and the Department of
{- Finance -} {+ Information Technology +} shall coordinate in the
development of policies and procedures which implement the intent of
this chapter.  The Department of {- Finance -} {+ Information
Technology +} shall have the final authority in the determination of
any {- such -} general policy and the Department of General Services
shall have the final authority in the determination of any {- such
procedure -} {+ procedures +} .                                ____
CORRECTIONS Text -- Pages 12 and 22.
____