In opinion number 05-405 dated January 24, 2006, Attorney General Bill Lockyer concluded that a school district must competitively bid a contract for factory-built modular building components for installation on a permanent foundation.

The opinion analyzed the competitive bidding requirements that apply to school districts, including those under Public Contract Code section 20111 which requires school districts to “let any contract for a public project … involving an expenditure of fifteen thousand dollars ($15,000) or more, to the lowest responsible bidder.” After considering the definition of “public project” pursuant to Public Contract Code section 22002(c), the Attorney General concluded that “as a general rule, a school district intending to contract for the construction, reconstruction, renovation, improvement, or repair of any school building, where the work will require an expenditure of $15,000 or more, must follow a competitive bidding process.” 

The opinion focused on school districts’ authority to purchase “materials, supplies, equipment, automotive vehicles, tractors, and other personal property” without advertising for bids under Public Contract Code § 20118. In particular, the issue was whether the factory-built modular components could be considered “other personal property” which would be exempt from competitive bidding. After applying principles of statutory construction, the Attorney General concluded that section 20118 does not apply to the factory-built modular components, and that the a contract for these material must be competitively bid. 

http://ag.ca.gov/opinions/published/06jan.htm