EXECUTIVE ORDER D-55-02


WHEREAS, it is essential that State contracting and procurement procedures be of the highest integrity; and

WHEREAS, the State of California purchases millions of dollars of goods and services annually, necessary to carry out programs vital to the people of this state and which are integral to efficient governmental operations; and

WHEREAS, open and competitive bidding on state contracts ensures that state agencies and California taxpayers receive the best value for the goods and services purchased, and that all providers should enjoy equal access and opportunity to provide these goods and services; and

WHEREAS, in 1993, legislation was enacted and signed into law that created the California Multiple Award Schedule (CMAS) Program to enable vendors and companies to participate in a pre-screened, competitive process that streamlined procurement procedures by establishing approved vendor lists; and

WHEREAS, it is important that a comprehensive review of current state procurement processes without competitive bidding, or through CMAS or Master Service Agreements (MSA) be undertaken to identify necessary safeguards and areas of improvement in the state's procurement processes; and

NOW, THEREFORE, I GRAY DAVIS, Governor of the State of California, by virtue of the power and authority vested in me by the Constitution and the statutes of the State of California, do hereby issue this order to become effective immediately:

  1. Executive Order W-103-94 and all management memos issued pursuant to that executive order, including Management Memo 96-16, are hereby rescinded;
  2. I am directing Department of Developmental Services Director Cliff Allenby, Los Angeles County Chief Administrative Officer David Janssen, and Chief Deputy Director of Finance Annette Porini, who shall serve as chair, to review the state's contracting and procurement procedures and recommend any statutory, regulatory or administrative changes necessary to ensure that open and competitive bidding is utilized to the greatest extent possible in awarding state contracts;
  3. They shall also recommend any statutory or regulatory changes to ensure adequate oversight of the procurement processes by state agencies and departments. They shall report to me with their preliminary findings and recommendations within 90 days;
  4. During this review period, no state contract or procurement greater than $100,000, including those bid under CMAS, any Statewide Master Service Agreement, and the Cal-Store Master Service Agreement (CalStore), shall be executed unless awarded pursuant to a competitively bid process.
  5. During this review period, any state contract or procurement in the amount of $100,000 or less must comply with interim guidelines applicable to contracts less than $100,000 adopted by the Department of General Services within five (5) working days of this order and approved by the Director of the Department of Finance;
  6. During this review period, any state contract or procurement greater than $100,000 and not competitively bid may only be executed to ensure the provision of essential services, or where public health or safety so require, or in the case of an emergency as defined in Public Contract Code section 1102, or to avoid financial loss to the state, and then only pursuant to interim guidelines applicable to contracts over $100,000 adopted by the Department of General Services within five (5) working days of this order and approved by the Director of the Department of Finance. This executive order does not apply to contracts or procurements authorized pursuant to or in fulfillment of a settlement by the State of pending or anticipated litigation during the 90-day review period.