April 21, 2026 · Ag · 1,246 words · 5 speakers · 16 segments
Good morning. The Senate Committee on Agriculture will come to order. I believe we have a quorum. Please call the roll. Senator Caballero?
Here. Caballero here.
Alvarado Gill?
Here.
Alvarado Gill here. Ashby? McNerney? Padilla?
Here.
We do have a quorum. So welcome this morning, this rainy morning on the day of Agriculture Day at the Capitol. We have a very brief agenda today. We had two items. One item has been pulled, and that is item number 2, SB 1410 by Senator Alvarado Gill. So that leaves us file item number 1, SB 1223 by Senator Padilla.
Welcome, and the floor is yours. Good morning, Madam Chair and members, and Madam Chair, many happy returns. Pleased to present and be joined by my witness this morning. SB 1223 would require state and county fares to use competitive bidding standards in the awarding of contracts and prohibit sole source contracting. A recent investigation by the Los Angeles Times found widespread corruption in California's fares. It's found that over one million in public funds were stolen, and state auditors had accused officials of dozens of other fairs of misspending equal sums. In order to address some of the corruption, lawsuits were filed by a fair midway operator against the San Diego and Orange County fairs. It was found in the lawsuit against the San Diego County Fair that fair officials had changed the scores of a 2021 contract competition to favor one bidder over another under the direction of the fairground CEO. The lawsuit against the Orange County Fair revealed that the public contract code competitive bidding requirements do not apply to all fair contracts, allowing certain bids to be tailored or written for a single entity or petitioner. The public contract code was written to guard against favoritism and promote fair competition in state contracts. Competitive bidding requirements are an important tool for transparency and accountability by promoting fair competition These bidding requirements also ensure that the state is securing the best service at the best price Fairs are a public resource that are enjoyed by many throughout the state and we must close this loophole to help combat corruption that is plaguing a cherished public tradition. I'm pleased to have with me today Mr. John Moot, Senior Counsel at Freeman, Mathis & Gary, as my witness.
Welcome, sir. Thank you.
The floor is yours.
Madam Chair, members of the committee, there are 54 district agricultural associations that hold fairs and exposition that are arguably not subject to the provisions of the California Public Contract Code. I was the attorney for tally amusements in the two lawsuits that are referenced in your committee report. In the first, the trial court held that the public contract code did apply to the 22nd District Agricultural Association. And in the course of that lawsuit, it was revealed the CEO of the fairgrounds not once but twice changed the scores to award the contract to the favored bidder. The way these contracts are rigged is to write them, write the RFP, so that only one company in the whole United States could meet the minimum experience and qualifications. However, as a result of this alarming testimony and an injunction issued by the trial court, the case was settled, Talley was reinstated in the fair, and Ag District paid our client $500,000. However, what happened in the 38th Agricultural District was very different. They wrote the same RFP, again, so only one company, the favorite company, the same one in San Diego, could meet the minimum experience of qualifications. However, this time, the trial court ruled that the Food and Agricultural Code was written in such a way that it did not apply the public contract code. And as a result, the trial court dismissed the lawsuit. That carnival operator has now had for 20 years, an additional 10 years, an $80 million contract that has never gone through the competitive bidding process. Now, the appellate court, in a published opinion, upheld the trial court's dismissal, but stated in the footnote and I quote if the legislature did not intend a different result quote we invite them to revisit and clarify the language And that exactly what this bill does Parenthetically, we filed a petition with the California Supreme Court, and upon reviewing the petition, while they did not grant review, they did order the published opinion depublished. So I think even the California Supreme Court tacitly agreed that, yes, the Food and Agricultural Code cannot be read so that you can issue RFPs so only one bidder can meet the qualifications. So I thank Senator Patia. People don't realize how lucrative these contracts really are. I mean, the one in Orange County for five years is worth $80 million. I mean, this is a major generating source for revenue on property owned by the state. and absolutely should be subject to the competitive bidding process. Thank you very much.
Testimony in support. We're going to do the me-toos next. If you would like to support the bill, now is your time to come up to the mic and give your name and your affiliation and that you support the bill, and then we'll take the opposition. Anybody here like to give me-too testimony? Me-too testimony. very good is there any witness in opposition that would like to testify seeing none is there any me to opposition that would like to be placed on the record seeing none will bring the committee back to the committee for questions concerns comments motions move the bill you may conclude sir thank you
very much madam chair I'd like to thank my expert witness for his tenacity and for flagging this issue for not just me but for the legislature as a whole obviously we hope this is a productive outcome would respectfully ask for an I vote thank you very much and I also want to take a minute to thank you very
much it was a an excellent explanation for quite frankly government run amok if you will I think anybody in their right mind would would understand that a agricultural district is part of the state and that they that they have to follow state rules and procedure and if if it was in the AG code and not explicit it's an error and so I do appreciate you bringing this forward and you as well senator so a motion's been made please call the roll yes we did we did and your your noted is here now with your vote thank you okay so SB 1223 motion do pasta appropriations committee senator Caballero I Caballero I Alvarado Gill Alvarado Gill I Ashby McNerney McNerney I Padilla aye that bill has four votes we're going to put it on call for the absent members thank you very much for being here today appreciate your testimony The committee on agriculture will recess for five minutes. The Senate committee on agriculture will come to order again. we are we have concluded our agenda and we are closed adjourned oh oh that's right well let's go back on on the record again never mind we'll go back to SB 1223 by Senator Padilla please call the absent member Senator Ashby.
That concludes our roll call for today.
That bill is out four to one. No, four to zero. And that concludes the business of the Senate Committee on Agriculture. Have a good day, everybody.