California to Require 25% SBE Participation in State Procurement

Small businesses will be boosted by the new measures.

Source : Contractor News

November 21, 2022

Author : Patty Allen

California is emerging as a small business haven with Governor Gavin Newsom signing several bills passed by the legislature. Every bill had a significant impact on small businesses. 

The bills that Governor signed are listed below:

  1. AB 631 by Assemblymember Richard Bloom (D-Santa Monica) – This bill will permit charitable theaters and radio stations to sell alcoholic beverages during live performances.
  2. AB 676 by Assemblymember Chris Holden (D-Pasadena) – This bill equalizes the playing field and eliminates prejudice by bolstering franchisee safeguards.
  3. AB 920 by Assemblymember Cecilia Aguiar-Curry (D-Winters)- It allows craft distillers in the state to ship to customers directly.
  4. AB 2019 by Assemblymember Cottie Petrie-Norris (D-Laguna Beach)- This bill codifies a 25% small business goal for state procurement. It increases state agencies' capacity to contract with small and underserved firms.
  5. SB 1116 by Senator Anthony Portantino (D-La Cañada Flintridge) – This state bill establishes a grant program to fund salary reimbursements for the performing arts.
  6. SB 1370 by Senator Richard Pan (D-Sacramento) – This bill would allow a nonprofit radio broadcaster a special on-sale general license on the sale of liquor. The bill would expand the tied-house exception for special on-sale general licenses for nonprofit theater officials operating in certain cities and counties.
  7. SB 1407 by Senator Josh Becker (D-Menlo Park) – Assist with the move to employee ownership.

“California has invested billions of dollars in helping small businesses and entrepreneurs achieve their California Dream,” explained Governor Newsom. “These new laws build on our efforts to create a more inclusive economy with renewed innovation and growth opportunities for the country’s largest small business community.

Worker-Owned Recovery California (WORC), Project Equity, and Ownership America commended Governor Newsom for signing into law Senate Bill 1407. The Act provides small business owners in California with options for succession and employee participation. It allows workers across the state to become co-owners of their place of employment.

The bill creates an Employee Ownership Hub inside the Governor's Office for Business and Economic Development (GO-Biz) to provide business owners and workers with information about employee ownership transitions and support for existing worker-owned enterprises.

“Employee ownership enables working people to build wealth while sustaining businesses for the long haul in their communities,” stated Senator Josh Becker. “Data shows that employee-owned businesses outperform their peers in profitability, productivity, and resilience.”

The California small business community is celebrating the new legislation. AB 2019 will hold departments and agencies accountable for allocating 25% of their contract revenue to small companies. This bill also mandates that these departments and agencies adopt a plan to ensure the participation of women-, minority-, and LGBTQ+-owned firms in the procurement process.

In the last few years, it has been noted that male business owners have landed three-quarters of the government contracts and white business owners had the majority share of state of federal funds. All this is set to change with this new law.

“There are numerous and diverse small businesses who can provide services and products to the State, and this bill ensures they at least have a fighting chance to be awarded a contract,” said Julian Canete, President of the California Hispanic Chambers of Commerce.

Previously, on Contractor News, we reported how OSDS is getting an avalanche of SBE and DVBE certification requests.  Certified business people can get a variety of government-funded contract opportunities. 

Certified small business enterprises can apply for Prompt Payment Act incentives and will be able to find jobs through the outreach letters sent out by prime contractors. 

Follow us here at Contractor News for the latest on government construction.  


Category : Small Business Enterprises State Government

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