SMALL BUSINESS BILL PASSES ASSEMBLY COMMITTEE

A California Chamber of Commerce-supported job creator bill that expands small business opportunities passed an Assembly committee on April 20, 2010.

AB 1771 (Mendoza) helps promote new opportunities and business for small businesses and saves the state money by allowing state departments to award contracts of less than $25,000 for goods or services by certified micro businesses, small businesses or Disabled Veteran Business Enterprises (DVBEs) without seeking an exemption of the Prison Industry Authority (PIA) mandate if they are able to make the product for less than the PIA.

Current law in effect gives the PIA precedence over other vendors during the contract bid evaluation process, regardless of the price of the product. The PIA mandate unnecessarily reduces business opportunities for private companies and drives up state costs.

By reducing the impact of the PIA mandate and setting the bidding preference for micro-businesses and small businesses at the same level as the PIA, the state would expand the number of businesses that can compete for small state projects, with likely savings for most bids.

AB 1771 passed the Assembly Jobs, Economic Development and the Economy Committee on a vote of 6-0. It will be considered next by the Assembly Public Safety Committee.

This article is written by the California Chamber of Commerce Alert. Staff Contact is Marti Fisher.

INDEPENDENT CONTRACTOR WITHHOLDING PROPOSAL

The California Chamber of Commerce follows legislation and tries to protect California businesses. There is currently a proposal looming that will force small businesses to make interest free loans to the state. It would require businesses and public agencies to withhold 3% of payments to independent contractors. This money would be sent to the Franchise Tax Board instead of being in the independent contractors pocket, thereby making them able to keep their business going. This will severely hurt small businesses because of the tax compliance requirements that will need to be implemented and further hurt those that are independent contractors because they will be missing out on 3% of their income until they file their California taxes (if they file) and get a refund.

If you are interested in finding out more information, visit http://www.calchamber.com/alert/alert_2-5-10-4.htm