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§ 1896.71. Definition and Determination of Commercially Useful Function (CUF).


Barclays Official California Code of Regulations Currentness
Title 2. Administration
Division 2. Financial Operations
Chapter 3. Department of General Services
Subchapter 10.5. Disabled Veteran Business Enterprise Participation Goal Program for State Contracts
Article 2. DVBE Participation in State Contracting
2 CCR § 1896.71
§ 1896.71. Definition and Determination of Commercially Useful Function (CUF).
(a) A DVBE contractor, subcontractor or supplier of goods and/or services that contributes to the fulfillment of the contract requirements, shall perform a Commercially Useful Function (CUF) for each contract.
(b) A DVBE contractor, subcontractor, or a supplier of goods and/or of services is deemed to perform a CUF if the business does all of the following:
(1) Is responsible for the execution of a distinct element of work of the contract (including the supplying of services and goods);
(2) Carries out its obligation by actually performing, managing, or supervising the work involved;
(3) Performs work that is normal for its business services and functions;
(4) Is responsible, with respect to products, inventories, materials, and supplies required for the contract, for negotiating price, determining quality and quantity, ordering, installing, if applicable, and making payment;
(5) Is not further subcontracting a portion of the work that is greater than that expected to be subcontracted by normal industry practices.
(c) A contractor, subcontractor or supplier will not be considered to perform a commercially useful function if its role is limited to that of an extra participant in the transaction, contract or project through which funds are passed in order to obtain the appearance of DVBE participation.
(d) Contracting/procurement officials of the awarding department must:
(1) Evaluate if a DVBE awarded a contract meets the CUF requirement as defined in subdivision (b), and
(2) During the duration of the contract, monitor for CUF compliance (See State Contracting Manual Volume 1 Chapter 8 and Volumes 2 and 3, Chapter 3).
(e) If a CUF evaluation identifies potential program violations, awarding departments shall investigate and report findings to OSDS, referring to §§ 1896.88, 1896.91 and the State Contracting Manual.
Note: Authority cited: Sections 14600 and 14839, Government Code; Section 999.5, Military and Veterans Code. Reference: Sections 14837 and 14615.1, Government Code; and Sections 999, 999.5, 999.6 and 999.9, Military and Veterans Code.
1. New section filed 2-14-2013; operative 4-1-2013 (Register 2013, No. 7). For prior history, see Register 94, No. 4.
2. Amendment of section heading, section and Note filed 1-23-2017; operative 1-23-2017 pursuant to Government Code section 11343.4(b)(3) (Register 2017, No. 4).
3. Amendment of section and Note filed 11-29-2018; operative 1-1-2019 (Register 2018, No. 48).
This database is current through 5/6/22 Register 2022, No. 18
2 CCR § 1896.71, 2 CA ADC § 1896.71
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