999.7. (a) The awarding department shall withhold, on a contract entered into on or after January 1, 2021, ten thousand dollars ($10,000) from the final payment, or the full final payment if less than ten thousand dollars ($10,000), until a prime contractor complies with the certification requirements of subdivision (d) of Section 999.5. A prime contractor that fails to comply with the certification requirement shall, after notice, be allowed to cure the defect. Notwithstanding any other law, if, after at least 15 calendar days but not more than 30 calendar days from the date of notice, the prime contractor refuses to comply with the certification requirements, the awarding department shall permanently deduct ten thousand dollars ($10,000) from the final payment, or the full payment if less than ten thousand dollars ($10,000). For contracts awarded for use by multiple state agencies, the Department of General Services may prescribe additional or alternative mechanisms for enforcing the certification requirement.
(b) (1) On or before January 1, 2024, the Legislative Analyst’s Office shall complete a comprehensive assessment of the disabled veteran business enterprise program and submit a report to the Legislature. All other state entities shall assist the Legislative Analyst’s Office in completing its assessment to the greatest extent practicable.
(2) The report submitted pursuant to paragraph (1) shall include, but is not limited to:
(A) Reports of noncompliance with the requirements of the disabled veteran enterprise program.
(B) Whether the Department of General Services is tracking complaints of abuse of the program, and information about those complaints, if available, including the type of abuse, how it was reported or discovered, dates that specific actions were taken on the case, and preventive measures taken by awarding departments.
(C) Whether the awarding departments notified disabled veteran business enterprise subcontractors when they were named on an awarded contract.
(D) Whether prime contractors received approval by the Department of General Services to replace a disabled veteran business enterprise subcontractor identified by the prime contractor in its bid or offer.
(E) Whether withholding payments have deterred prime contractors from failing to provide accurate certifications.
(3) A report to be submitted pursuant to this subdivision shall be submitted in compliance with Section 9795 of the Government Code.
(c) Notwithstanding any other law, an awarding department shall not withhold more than the amount specified in subdivision (a) on the final payment of any disabled veteran business enterprise contract for the purposes of ensuring compliance with the certification requirements of subdivision (d) of Section 999.5.
(Added by Stats. 2020, Ch. 80, Sec. 2. (SB 588) Effective January 1, 2021.)