Senate BillFailedGovernment
SB 713: Employee stock ownership plans: contractors: certification: bid preferences.
What SB 713 does, verified February 3, 2026
The bill aims to promote economic development in California by supporting small businesses and employee-owned companies. It requires the state to issue an employee stock ownership plan (ESOP) contractor certificate to qualified contractors that meet certain requirements, including a valid and favorable determination letter from the IRS. The certificate must be renewed every three years and indicates the percentage of ESOP ownership for the applicant. The state will provide bid preferences to qualified contractors based on the percentage of ESOP ownership when preparing solicitations for state-funded construction contracts. The bill also authorizes the creation of a comprehensive bidders list of qualified contractors that have received the ESOP contractor certificate.
Bill journey
✓IntroducedComplete
2In CommitteeCurrent
3First Chamber FloorPending
4Second ChamberPending
5GovernorPending
6ChapteredPending
Last action: Returned to Secretary of Senate pursuant to Joint Rule 56. (2026-02-02)Alert me
Author and sponsors
Full contact details, staff, and committees with Connect, $16/moUnlockRecent actions17 total · showing 5
| Feb. 02, 2026 | Returned to Secretary of Senate pursuant to Joint Rule 56. |
| May. 23, 2025 | May 23 hearing: Held in committee and under submission. |
| May. 16, 2025 | Set for hearing May 23. |
| May. 12, 2025 | May 12 hearing: Placed on APPR. suspense file. |
| May. 02, 2025 | Set for hearing May 12. |
Latest bill textAmended version, April 23, 2025 · 454 words
| Amended IN Senate April 23, 2025 |
CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION
Senate Bill
No. 713
| Introduced by Senator Valladares |
February 21, 2025 |
An act to amend Sections 12100.32 and 12100.33 of, and to add Sections 12100.34 and 14112 to, the Government Code, relating to economic development.
LEGISLATIVE COUNSEL'S DIGEST
SB 713, as amended, Valladares. Employee stock ownership plans: contractors: certification. certification: bid preferences.
Existing
(1)
Existing law creates within the Governor’s Office of Business and Economic Development the Office of Small Business Advocate in order to advocate the causes of small business and to provide small businesses with the information they need to survive in the marketplace to be led by the Small Business Advocate. The California Employee Ownership Act requires, upon appropriation by the Legislature, the Office of Small Business Advocate to establish the California Employee Ownership Hub (hub) and to appoint an Employee Ownership Hub Manager (manager) to administer the hub. The act authorizes the manager to be responsible for certain duties, including working with all California state agencies whose regulations and programs affect employee-owned companies, and businesses with the potential to become employee-owned, to enhance opportunities and reduce barriers.This bill would require the Director of General Services (director) to issue an employee stock ownership plan (ESOP) contractor certificate to a qualified contractor, as defined, with an ESOP that meets certain criteria, including that at least an unspecified percentage of the qualified contractor’s employees participate in the ESOP, as specified. that presents a valid and favorable ESOP determination letter from the Internal Revenue Service. The bill would require the director to determine the percentage of ESOP ownership for an applicant and indicate the percentage on the certificate, as specified. The bill would require the director to require that the certificate be renewed every 3 years. The bill would additionally authorize the manager to be responsible for compiling and maintaining a comprehensive bidders list of qualified contractors that have received that the certificate from the Director of General Services. The
(2) Existing law establishes within the Transportation Agency a Department of Transportation. Existing law requires the Department of Transportation to, among other things, plan, design, construct, operate, and maintain those transportation systems that the Legislature has made, or may make, the responsibility of the department, except as specified.
This bill would also require, beginning January 1, 2027, the Department of Transportation to ensure that an unspecified percentage of state funded construction contracts and construction-related procurements involve contractors who have received that certificate. provide bid preferences to qualified contractors that have received the certificate based on the percentage of the qualified contractor owned by its ESOP, whenever the department prepares a solicitation for a state-funded construction contract, as specified.
Text of SB 713 as amended, from the official record. Connect Plus keeps every version and highlights what changed.Compare versions