California Bill Introduced Prohibits Abuse of Secret No-Bid Contracts

California Gov. Gavin Newsom speaks at California State University Long Beach, in Long Beach, Calif., on March 3, 2021. (John Fredricks/The Epoch Times)

SACRAMENTO—California State Senate Republican Minority Leader Scott Wilk (R-Santa Clarita) recently introduced a bill to prohibit state departments from approving so-called no-bid contracts to companies that have made substantial donations to the governor within the previous 12 months, after Facebook, Google, Blue Shield, and other large companies reportedly contributed more than $200 million to Gov. Gavin Newsom’s government efforts in 2021.

Senate Bill (SB) 1367, introduced Feb. 18, seeks to address the perception of “pay-to-play,” according to Wilk, stemming from the governor’s “increasing use of secretive no-bid contracting” and the influx of behested payments, which are donations coordinated by elected officials for legislative or charitable purposes.

During the pandemic, companies poured millions of dollars toward supporting the governor’s initiatives, including homelessness and a massive COVID-19 public safety campaign, according to a Los Angeles Times report in April 2021.

“SB 1367 specifically cracks down on awarding massive no-bid state contracts to companies that have made donations to charities on behalf of the governor,” Wilk told The Epoch Times in a statement. “The perception of ‘pay-to-play’ in no-bid contracts erodes the public’s trust.”

This bill is part of Wilk’s “government accountability package,” a series of bill proposals that seek to crack down, he says, on California’s alleged unethical government practices and “to preserve public trust.”

Contracts, Wilk said, should be awarded “on merit and not political connections.”

Under current state and local laws, companies applying for no-bid contracts don’t face the pressure of competition or favoritism, whereas open-bid contracts allow for companies to compete to fill the vacancy.

However, during the state of emergency announced in March 2020 due to COVID-19, Newsom was permitted to skip that process.

There is no cap on behested payments—which are usually requested by elected officials and made by donors to charitable organizations that an elected official supports.

Under California law, a payment made by a private entity or person for governmental, legislative, or charitable purposes at the request of a governmental official is not considered a gift or donation to that official. When payments equal $5,000 or more and are made at the behest of an elected official, they must disclose that amount to the public.

But critics like Wilk say the practice has eroded the public’s trust in the government’s ability to discern potential conflicts of interest with donors.

The Los Angeles Times reported in 2021 that over $43 million in behest payments were given to the governor’s office, equating to half a million from Youtube, $300,000 from TikTok, and $227,000 from Netflix.

These donations were used for public health ads, and on behalf of the governor, Pfizer Inc. gave $250,000 to a nonprofit providing trailer shelters to families in need during the pandemic, according to the report.

SB1367 and Wilk’s slew of other similar bills related to the state’s $1.7 billion no-bid contract with PerkinElmer for COVID-19 testing at the Valencia Branch Laboratory will be heard in committee in March.

“As this is not a sponsored bill, we are working on procuring support from government agencies and members of the California State Legislature,” Wilk’s office said in an email.

The Epoch Times reached out to Newsom’s office but didn’t hear back by press time.