Best value procurement: school districts.

Assembly Member Schultz's legislation expands school districts' authority to use best value procurement methods for construction projects, building upon practices previously limited to the Los Angeles Unified School District. The bill establishes a framework allowing districts to award contracts based on both price and contractor qualifications rather than cost alone for projects exceeding $1 million.

The measure makes permanent LAUSD's existing best value procurement program while creating a parallel authorization for other California school districts through December 2030. Districts must adopt formal procedures for evaluating bidder qualifications, including financial capacity, relevant experience, management competency, labor compliance, and safety records. The evaluation process requires maintaining bidder confidentiality during qualification scoring and mandates the use of skilled and trained workforces unless specific project labor agreements are in place.

For non-LAUSD districts, the bill requires an independent third-party report to the Legislature by January 2030 detailing project outcomes, contract awards, contractor selection, bid protests, and assessment of the evaluation methodology. The report must include information about completed projects' performance, including any delays or cost increases. These provisions contain a sunset clause and will be repealed on January 1, 2031.

The legislation maintains existing protections for subcontractors and places a 5% cap on retention proceeds when performance and payment bonds are required. While offering an alternative to traditional lowest-bid requirements, the measure preserves districts' authority to award contracts to the lowest responsible bidder or reject all bids.