Bill > SB713

This bill establishes a new certification process and bidding preference system for contractors with employee stock ownership plans (ESOPs) in California. The bill requires the Director of General Services to issue an ESOP contractor certificate to qualified contractors who present a valid and favorable ESOP determination letter from the Internal Revenue Service, with the certificate indicating the percentage of company ownership held by the ESOP. The certificate must be renewed every three years, and the Director may charge a fee to cover administrative costs. Beginning January 1, 2027, the Department of Transportation will be required to provide bid preferences for state-funded construction contracts to ESOP-owned contractors based on their level of employee ownership. These preferences range from 2% to 4% depending on the percentage of the company owned by the ESOP, with an additional 1% preference for contractors with employees covered by collective bargaining agreements. The bill also tasks the California Employee Ownership Hub with compiling and maintaining a list of certified ESOP contractors. This legislation aims to encourage employee ownership and provide economic advantages to businesses with significant employee stock ownership.

Budget and Finance, Business and Industry, Transportation and Infrastructure

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260SB713