(a) The department shall provide that, if any funds are set aside, or caused to be set aside, from the net proceeds of the operation of the vending facilities those funds shall be set aside, only to the extent necessary, but not to exceed the amount equal to 6 percent of gross sales, and may be used only for the following purposes:

(1) Maintenance and replacement of equipment.

(2) The purchase of new equipment.

(3) The construction of new vending facilities.

(4) Funding the functions of the committee of blind vendors established by Section 19638.

(5) Retirement or pension funds, health insurance contributions or premiums, life insurance contributions or premiums to the extent approved by the federal Rehabilitation Services Administration, and provision for paid sick leave or vacation time or business-related insurance, if it is so determined by a majority vote of blind vendors after the department provides to each vendor full information on all matters relevant to these purposes. The department shall seek the necessary approval for expenditures of set-aside funds for life insurance contributions or premiums.

(b) No set-aside funds shall be collected where the monthly net proceeds are less than one thousand dollars ($1,000). This amount shall be annually adjusted by the department to reflect changes in the cost of living. The average of the separate indices of cost of living for Los Angeles and San Francisco, as published by the United States Bureau of Labor Statistics, shall be used as the basis for determining the change in the cost of living.

(c) Set-aside funds collected from the operation of all vending facilities administered by the Business Enterprise Program shall be placed in a single fund.

(d) As used in this section, “net proceeds” shall be the sum of the amount remaining from the sale of articles or services and the amount of any vending machine or other income accruing to blind vendors after the cost of sale and other expenses (excluding set-aside charges required to be paid by the blind vendors) have been deducted.

(e) It is the intent of the Legislature that the expenditure of the service charges authorized by this section shall be supplemental to any current appropriations available for these purposes and shall not constitute an offset or diminution of any appropriations.

(f) An amount equal to 10 percent of the wages paid by a vendor to any blind person, as defined in Section 19153, or to any disabled person, as defined in regulations issued by the department, shall be deducted from any service charge paid by the vendor, in order to encourage vendors to employ more blind and disabled workers and thereby set an example for industry and government. There shall be no deduction from any service charge paid by a vendor if the vendor does not pay wages at least equal to the minimum wages required of employers pursuant to Chapter 1 (commencing with Section 1171) of Part 4 of Division 2 of the Labor Code.

(Amended by Stats. 1998, Ch. 329, Sec. 45. Effective August 21, 1998.)