Full opinion text
Opinion CHIN, J. We consider here important questions of law and policy arising under the state Constitution’s civil service provision (Cal. Const., art. VII, § 1 (article VII)) and its implied mandate limiting the state’s authority to contract with private entities to perform services the state has historically or customarily performed. (See, e.g., State Compensation Ins. Fund v. Riley (1937) 9 Cal.2d 126, 134-136 [69 P.2d 985, 111 A.L.R. 1503] (Riley); California State Employees’ Assn. v. State of California (1988) 199 Cal.App.3d 840, 844 [245 Cal.Rptr. 232] (CSEA).) As we explain, the civil service mandate forbids private contracts for work that the state itself can perform “adequately and competently.” (Riley, supra, 9 Cal.2d at p. 135.) In April 1990, the trial court enjoined defendant state Department of Transportation (Caltrans) from privately contracting for engineering and inspection services that state civil service employees had traditionally performed on state highway projects. The trial court found Caltrans failed to show that these contracts were more cost-effective or that state workers could not adequately perform the work. The primary question we must decide is whether intervening legislation (Stats. 1993, ch. 433) (Chapter 433), reflecting broad legislative approval of private contracting by Caltrans, authorizes these contracts under the conditions set forth in that legislation and so affords a proper ground for dissolving or modifying the injunction. Although the Court of Appeal majority concluded that Chapter 433 alone justified dissolution of the 1990 injunction, we disagree, believing the principles announced in prior case law require a contrary holding. If the constitutional civil service mandate is to retain any vitality as a protective device against the deterioration of the civil service system through private contracting, we must hold that Chapter 433 represents an invalid or ineffectual attempt to circumvent that constitutional mandate. As we explain, however, nothing prevents Caltrans from seeking modification of the 1990 injunction based on a showing that particular contracts are justified because state workers cannot perform the work “adequately and competently.” Because the discussion of the prior and current litigation would be largely meaningless without knowledge of the underlying legal principles, we will outline the general constitutional and statutory principles before discussing their application to the facts of this case. Background I. The Civil Service Mandate Article VII, like its predecessor, former article XXIV of the state Constitution, defines the state civil service as including “every officer and employee” of the state, with exceptions not pertinent here. (Art. VII, § 1, subd. (a); see Cal. Const., former art. XXIV, § 4, subd. (a).) The article further provides that “[i]n the civil service permanent appointment and promotion shall be made under a general system based on merit ascertained by competitive examination.” (Art. VII, § 1, subd. (b); see Cal. Const., former art. XXIV, § 1.) Article VII also creates the State Personnel Board (§ 2), to which enforcement and administration of the civil service laws are delegated (§3), and exempts from the civil service certain positions that are not pertinent here (§ 4). The state Civil Service Act (Gov. Code, § 18500 et seq.) implements article VII. (See California State Employees’ Assn. v. Williams (1970) 7 Cal.App.3d 390, 394-395 [86 Cal.Rptr. 305] (Williams).) The ballot argument to the voters at the time California Constitution, former article XXIV was adopted in 1934 stressed the purpose of the civil service provision was “ ‘to promote efficiency and economy’ ” in state government by “ ‘prohibiting] appointments and promotion in the service except on the basis of merit, efficiency, and fitness ascertained by competitive examination. . . .’” (Riley, supra, 9 Cal.2d at p. 134.) Other than the general civil service provisions previously described, neither present article VII nor former article XXIV expressly prohibits or restricts private contracting. As one appellate decision has observed, “Decisional law interprets article VII as a restriction on the ‘contracting out’ of state activities or tasks to the private sector. [Citations.] The restriction does not arise from the express language of article VII. [Citation.] ‘Rather, it emanates from an implicit necessity for protecting the policy of the organic civil service mandate against dissolution and destruction.’ [Citation.]” (CSEA, supra, 199 Cal.App.3d at p. 844.) II. Decisional Law Because of the largely implicit nature of the private contracting restriction, we must discern its scope from judicial decisions applying it in particular cases. Early appellate decisions held that the civil service mandate forbids private contracting, whether for permanent or temporary services, skilled or unskilled, if those services are of a kind that persons selected through civil service could perform “adequately and competently.” (Riley, supra, 9 Cal.2d at p. 135 [enjoining state agency from retaining private attorney]; see also Burum v. State Compensation Ins. Fund (1947) 30 Cal.2d 575, 579-582 [184 P.2d 505]; Stockburger v. Riley (1937) 21 Cal.App.2d 165, 170 [68 P.2d 741] (Stockburger) [enjoining state from hiring private independent contractors to clean state building].) Riley rejected the argument that the services independent contractors perform are beyond the civil service mandate’s reach, stating that “[a]ny other construction of the constitutional provision would have the effect of weakening, if not destroying, the purpose and effect of the [civil service] provision.” (Riley, supra, 9 Cal.2d at pp. 135-136.) Later cases have affirmed the “nature of the services” restriction declared in Riley, but have also indicated that the restriction is inapplicable if the state seeks to contract for private assistance to perform new functions not previously undertaken by the state or covered by an existing department or agency. (See Kennedy v. Ross (1946) 28 Cal.2d 569, 571-574 [170 P.2d 904], [interpreting analogous civil service provision in city charter]; San Francisco v. Boyd (1941) 17 Cal.2d 606, 618-620 [110 P.2d 1036] [same]; Williams, supra, 7 Cal.App.3d at pp. 397-400 [permitting state to hire private insurance carriers to administer state Medi-Cal program].) As Williams observed, “. . . if the services cannot be adequately rendered by an existing agency of the public entity or if they do not duplicate functions of an existing agency, the contract is permissible.” (Williams, supra, 7 Cal.App.3d at p. 397, italics added.) According to Williams, the civil service mandate is aimed at protecting “the existing civil service structure,” and does not compel the state “to fulfill every new state function through its own agency.” (Ibid.) In CSEA, the appellate court upheld the facial constitutionality of legislation (§ 19130, subd. (a)) that allows the state to contract for “personal services” to obtain cost savings, if it can achieve these savings without ignoring other applicable civil service requirements (e.g., use of publicized, competitive bidding, no undercutting of state pay rates, no displacement of state workers or infringement of affirmative action plans, and no overriding public interest in having the state perform the function). (See CSEA, supra, 199 Cal.App.3d at pp. 844-846.) The court observed that allowing the state to consider cost savings in determining the propriety of private contracting would be consistent with the two main purposes of article VII, namely, “ ‘to promote efficiency and economy’ ” in state government, and “to eliminate the ‘spoils system’ of political patronage.” (CSEA, supra, 199 Cal.App.3d at p. 847.) CSEA opined that the voters who enacted the constitutional civil service provision did not intend to impose a system devoid of all considerations of fiscal responsibility and economy in favor of “an infinitely expanding public payroll,” and agreed that “[t]he goal of maintaining the civil service must be balanced with the goal of a fiscally responsible state government.” (Id. at p. 853.) CSEA thus settled the question whether cost savings would be relevant in determining the validity of private contracting for work not involving any new state functions. The Court of Appeal in Stockburger, supra, 21 Cal.App.2d at page 167, had questioned the relevance of cost savings, but CSEA overruled that decision in light of the ballot argument’s emphasis on “efficiency and economy.” (CSEA, supra, 199 Cal.App.3d at p. 851.) CSEA determined that cost savings or efficiency would be a relevant, though not conclusive, factor in applying Riley's “nature of the services” test. (CSEA, supra, 199 Cal.App.3d at p. 851.) In Department of Transportation v. Chavez (1992) 7 Cal.App.4th 407 [9 Cal.Rptr.2d 176], Caltrans sought to enter into contracts with private firms to maintain roadside rest areas. The record indicated, however, that Caltrans had assumed responsibility for this work since 1963, so no “new state functions” were involved that might have justified an exception to the implied civil service mandate. (Id. at pp. 414-417; see Williams, supra, 7 Cal.App.3d at p. 397.) Moreover, Caltrans had not attempted to prove that private contracting could produce any substantial cost savings. (Department of Transportation v. Chavez, supra, 7 Cal.App.4th at p. 411.) Accordingly, the court ruled the private contracts invalid. (Id. at pp. 416-417.) Finally, in Professional Engineers v. Department of Transportation (1993) 13 Cal.App.4th 585 [16 Cal.Rptr.2d 599] (Professional Engineers), the Court of Appeal held that, on an experimental basis, the state might properly release a former function in favor of “privatization” without offending civil service principles. In that case, the Legislature had authorized Caltrans to contract with private development firms to construct and operate tollways under state lease, in order to secure needed transportation systems unobtainable through public financing arrangements. The Court of Appeal upheld the statute, concluding that, although the design and construction of roads were neither new functions nor ones that state workers could not satisfactorily perform, the privatization program was an experimental one, and no state funds would be used to defray construction costs. Under these circumstances, considerations of efficiency and economy permitted an exception to the private contracting restriction. (Id. at pp. 593-594, and fn. 4.) III. Preexisting Legislation From time to time before adopting Chapter 433, the Legislature had enacted provisions governing the state’s authority to contract with private entities. These sections appear consistent with the decisional law interpreting article VII. (Ante, at pp. 548-550.) Although many of these provisions remain in effect, Chapter 433 has supplemented them. Before examining the provisions of Chapter 433, we first review the primary preexisting provisions, as they are pertinent to an understanding of the intent and effect of Chapter 433. Section 14101 permits Caltrans to contract with qualified private architects and engineers if “the obtainable staff is unable to perform the particular work within the time the public interest requires such work to be done.” Former section 14130 et seq. (Stats. 1991, ch. 313, § 1.5) dealt with contracts for professional and technical services. Former section 14130, subdivision (a), set forth certain legislative findings, including: (1) recognition of a “compelling public interest” in capturing and using in a timely manner available federal, state, local, and private funds for the state highway program (former § 14130, subd. (a)(1)); (2) declaration of a need to be “plan-ready” to maximize use of these funds (former § 14130, subd. (a)(2)); and (3) recognition of a need for “additional flexibility through outside contracting” to supplement Caltrans’s program staff, maintain a more stable work force, and avoid “short-term hiring and layoff’ (former § 14130, subd. (a)(3)). Subdivision (b) of that section expressed the legislative intent to allow Caltrans to contract privately for professional and technical services “whenever the department is inadequately staffed to satisfactorily carry out its program [of project development] . . . in a timely and effective manner.” Section 14131 permits Caltrans to contract for services with engineers, architects, surveyors, and other similar professionals whenever certain guidelines contained in section 14134 are applicable, as long as these contracts do not displace any Caltrans employees. Section 14134, subdivision (a), sets forth guidelines that include ensuring the timely capture and use of available federal, state, and local funding, reducing “short-term fluctuations” in workload relating to project study and development, ensuring that “the cost effectiveness of contracting” is considered equally with other factors in contracting decisions, and ensuring that the contract selection process complies with state law and avoids unlawful or unfair procedures. Section 14133, subdivision (a), provides that the “personal services contracts” provisions of section 19130 (discussed in the following paragraph) are inapplicable to professional and technical service contracts made under section 14130 et seq. Finally, section 19130 (which was upheld as consistent with article VII in CSEA, supra, 199 Cal.App.3d 840) governs “personal services contracts” and essentially codifies and interprets the “cost savings,” “new state function,” and “nature of the services” tests of the decisional law (see ante, at pp. 548-550), as applied to those contracts. IV. Chapter 433 Effective September 24, 1993, the Legislature adopted Chapter 433. (The provisions Chapter 433 added are effective only until January 1, 1998, unless extended.) We will paraphrase or summarize the key provisions here. First, uncodified section 1 of Chapter 433 recites the Legislature’s intent: (1) to allow Caltrans “continued flexibility” to contract privately as needed to assure timely delivery of its projects; and (2) to afford “a new and independent basis upon which to justify contracting out actions.” Next, the Legislature amended section 14130 to add additional legislative findings and declarations, including the following relevant ones: Use of private “consultants” to supplement Caltrans’s workforce has permitted it “to substantially enhance its project delivery,” including acceleration of state highway construction projects costing nearly $1 billion. (§ 14130, subd. (a)(4).) This increase in project delivery capability “must continue in order for [Caltrans] to meet its commitments for timely project delivery,” and, accordingly, a “stable contracting out program” using private consultants is needed to allow Caltrans to perform project delivery “adequately, competently, or satisfactorily.” (§ 14130, subd. (a)(4).) Caltrans’s use of private consultants to assist in project delivery “is a new state function and does not duplicate the existing functions of the department.” (§ 14130, subd. (a)(5).) Caltrans may use private contracting on state highway projects funded by federal and state funds “to support state transportation infrastructure funded by local resources, to ensure timely retrofitting for seismic safety on state transportation infrastructure, and to ensure timely and cost-effective project delivery.” (§ 14130, subd. (c).) Caltrans “shall not be required to utilize state employees to perform all engineering and related services to the maximum extent required to meet the goals of this article,” or to hire new staff “to an internal level that matches its ability to assimilate and productively use new staff.” (§ 14130, subd. (d).) Additionally, the Legislature added sections 14130.1, providing that engineering services needed to complete the seismic safety retrofit program “shall be considered a short-term workload demand” (§ 14130.1, subd. (b)), and 14130.2, providing that engineering services needed to deliver locally financed highway projects “are not required to be considered in determining [Caltrans’s] project delivery staffing needs. [Caltrans] is not required to staff at a level to provide services for other agencies.” (§ 14130.2, subd. (a)(2).) Section 14130.2 also provides that Caltrans “may balance the need for outside contracting for these services on a program basis, rather than on an individual contract basis.” (§ 14130.2, subd. (b).) New section 14130.3 finds that “recent court decisions” have resulted in the termination of certain existing private contacts awarded to minority-, women-, and disabled-veteran-owned firms, a result that is inconsistent with public contracting goals. A related provision, new section 14137, declares that contracts in force or awarded before July 1, 1993, for project management services “shall not be terminated, but shall continue to the conclusion of those contracts.” As the Court of Appeal majority recognized, these provisions, though somewhat inartfully drafted, seem aimed at authorizing Caltrans’s private contracting and circumventing the trial court’s injunction and subsequent enforcement orders. The question before us here is whether these provisions are consistent with article VII. V. The Prior Litigation Having reviewed the general constitutional, statutory, and decisional framework, we return to the facts of this case. In 1986, plaintiffs (a labor organization representing state engineers and a citizen/taxpayer) filed suit to enjoin Caltrans from contracting with private entities to carry out state highway projects traditionally done by state civil service employees. Following trial, on March 26, 1990, the court (Sacramento Superior Court, Eugene T. Guaico, Judge), issued an extensive statement of decision in plaintiffs’ favor. The court found that since the 1986-1987 fiscal year, Caltrans has unlawfully contracted privately for engineering projects that the civil service has traditionally done; that by hiring more civil service employees, Caltrans could have the work at issue performed in a timely manner, and that Caltrans failed to justify private contracting on a cost-effectiveness or other valid basis. The trial court also found that Caltrans undertook private contracting as a direct result of “gubematorial/executive branch policy against the expansion of state government,” which required Caltrans to “balanceQ and temper[]” its requests for funding for additional staff by contracting with private entities, without regard to whether qualified persons were actually available for civil service employment or whether Caltrans could assimilate and train them in a timely manner. The court found insufficient evidence to support Caltrans’s contentions that (1) its increased project workload involved short-term or temporary work that private contractors could perform most economically and efficiently, or (2) private contracting would allow Caltrans to perform its work in a more timely and effective manner than hiring new civil service staff. Thus, on April 17, 1990, the court issued a permanent injunction prohibiting Caltrans from (1) contracting privately for engineering and inspection services for highway projects unless the work was to be performed in compliance with the then existing criteria set forth in section 14101 and former section 14130 et seq.; (2) entering into cooperative agreements with local entities when private entities were to perform part or all of the work; and (3) awarding contracts to private entities for construction survey staking. The court’s injunction also recited that Caltrans had failed to demonstrate that either (1) it could not timely perform the work by hiring additional civil service employees, or (2) private contracting was a more cost-effective way of meeting short-term peaks in its workload. Caltrans did not appeal that judgment, which is now final. The trial court retained jurisdiction over the case to monitor Caltrans’s compliance. From 1991 to 1993, the court issued additional orders implementing its injunction. One of these orders recited that because Caltrans was underestimating its actual workload and was maintaining an insufficient level of civil service staff, it needed to use private consultants to perform scheduled and unscheduled work beyond the capacity of civil service staff. The court concluded that Caltrans had violated the injunction by contracting with private entities for substantial amounts of project development work without providing adequate justification. Caltrans failed to appeal those orders. Responding to the trial court’s injunction and orders, Caltrans took some steps to minimize and phase out private contracting during fiscal year 1993-1994. It allocated funds previously authorized for private contracting to avoid disruptions of work in progress, to avert delay in projects involving public safety, and to provide expertise unavailable through civil service. To perform the remaining project development work targeted for private consultants, Caltrans made limited term, retired annuitant, or temporary civil service appointments. VI. The Present Order In September 1993, after the Legislature passed Chapter 433 amending and adding to section 14130 et seq., Caltrans took the position that these changes undermined the trial court’s injunction and related orders and justified their dissolution. Accordingly, as the trial court found in its April 19, 1994, order, Caltrans altered its contract projections for fiscal year 1993-1994 and issued new guidelines revising its earlier plan to minimize its private contracting. Caltrans identified substantial amounts of seismic retrofitting work and reimbursed work for local agencies as eligible for private contracting in fiscal year 1993-1994. Caltrans froze the hiring of new employees, began to terminate limited term appointments, and called for a 50 percent reduction in temporary help to eliminate an assumed “overstaffed condition.” Plaintiffs, contending that Chapter 433 did not authorize Caltrans’s scheduled contracting, sought an order holding Caltrans in contempt for violating the 1990 injunction. Caltrans, relying on the new provisions, asked the court to dissolve the injunction. Following briefing and argument, on April 19, 1994, the court issued its decision declining to modify or dissolve the injunction, which remains in full force. After summarizing the prior proceedings and relevant events, the court found that Caltrans’s existing and planned contracts for fiscal year 1993-1994 violated the 1990 injunction in three ways. First, Caltrans failed to justify these contracts by making a factual showing based on the criteria in former section 14130 et seq., as the injunction required. Instead, Caltrans relied solely on the new legislative findings characterizing seismic retrofitting as “short-term” work subject to private contracting (see new §§ 14130, subd. (a)(3), 14130.1, subd. (b)), on legislative directions that Caltrans not consider locally funded work in determining staffing needs (§ 14130.2, subd. (a)(2)), and on legislative encouragement of timely private contracting for state highway projects to generate maximum employment and business opportunities (§ 14130, subd. (a)(1)). Second, the court found that, in any event, the type and amount of project development work Caltrans contracted for 1993-1994 did not correspond to that which the new provisions authorized because it fell outside the seismic retrofitting and locally funded project categories. The court also found that Caltrans made no attempt to show these contracts satisfied the criteria for private contracting listed in section 14130. Third, the court found that Caltrans’s revised plan for contracting activity during 1993-1994 was contributing to the displacement of permanent, temporary, and part-time civil service staff. Caltrans claimed this staff reduction was needed to avoid a budget shortfall, but it was really attributable to Caltrans’s preference for private contracting. In summary, the court found that Caltrans was violating the 1990 injunction by contracting with private entities without factually demonstrating that it had met the statutory criteria for doing so. According to the court, Caltrans was displacing civil service staff from project development work that staff had historically performed and was maintaining staff at an inadequate level to create an artificial need for private contracting. The court next considered whether anything in Chapter 433 justified Caltrans’s breach of the 1990 injunction. After reviewing the new provisions at length, the court made the following findings and determinations: (1) Contrary to new section 14130, subdivision (a)(5), project development service is not a new state function exempt from the constitutional restriction on private contracting, and using private contractors for project development duplicates existing state agency functions. (See Professional Engineers, supra, 13 Cal.App.4th at pp. 592-593; Williams, supra, 7 Cal.App.3d at pp. 397-399.) State civil service staff has long performed these functions. (2) Contrary to new section 14130, subdivision (a)(4), Caltrans has not demonstrated that, because it must use private contracting to perform project delivery “adequately and competently,” its actions fall within another exception to the civil service mandate. (See Burum v. State Compensation Ins. Fund, supra, 30 Cal.2d at pp. 579-582; Riley, supra, 9 Cal.2d at p. 135.) Any inability of civil service staff to deliver project workload on time is attributable to Caltrans’s policy of inadequate staffing and reliance on private contracting. (3) Contrary to Caltrans’s contention, new section 14130.1, characterizing seismic retrofitting services as a “short-term workload demand,” fails to constitute adequate justification for private contracting because it fails to consider the civil service staff available and obtainable to perform the work. The retrofit program’s length “is comparable to or longer than many of the highway projects” in Caltrans’s workload and is similarly subject to unavoidable delays and unanticipated expansion in scope. Thus, merely characterizing work as “short-term” does not justify using private contractors to perform it. (4) Contrary to Caltrans’s contention, new section 14137, directing Cal-trans to continue any contracts presently in force or awarded on or before July 1, 1993, is ineffective to override the court’s earlier finding that certain contracts with private consultants for work during 1992-1993 did not meet the statutory criteria then in effect (former § 14130 et seq.). The new section states no facts to establish those contracts were exempt from the constitutional restriction on private contracting. (5) New sections 14130, subdivisions (a)(1) and (d), 14130.2, subdivision (a)(2), and 14130.3, establishing various state policies favoring private contracting, are contrary to the constitutional civil service mandate because they purport to authorize Caltrans to contract privately without regard to whether available civil service staff can timely perform the services. As the court observed, “Pursuant to the [new] provisions, [Caltrans] may calculate [its] civil service staffing needs without considering the full workload to be performed, may limit [its] procurement of civil service staff regardless of actual staffing needs or ability to productively use new staff, and [is] required to reinstate contracts for the purpose of fostering employment and business opportunities without regard to the constitutional civil service mandate. As a result, [Caltrans] purposely create[s] a need for ‘a stable contracting out program’ to timely deliver transportation projects, institutionalize the use of contracting in project delivery, and displace civil service employees from the function they have historically performed, in violation of article VII.” Thus, the court concluded that Chapter 433’s legislative findings and directives are “obviously erroneous, unreasonable and inconsistent with the constitutional civil service mandate,” and for that reason the provisions are unconstitutional to the extent they purport to authorize Caltrans to contract privately without a factual showing that the contract is permissible under applicable constitutional principles. In its April 19, 1994, order, the court accordingly affirmed its prior 1990 injunction, stating that “[t]o the extent that [Caltrans] justifies its] contracts with private consultants on the basis of the provisions of Chapter 433 . . . instead of a factually supported determination pursuant to . . . sections 14131 and 14134, the contracts are invalid and [Caltrans is] in violation of the injunction.” (Fn. omitted.) VII. Court of Appeal Majority Opinion The Court of Appeal majority reversed the judgment and remanded the matter to the trial court with directions to dissolve its 1990 injunction. The court concluded that Chapter 433 contains sufficient pronouncements, directions, and safeguards to satisfy plaintiffs’ earlier objections based on the private contracting restriction of article VII. The Court of Appeal majority, after reviewing the relevant constitutional and statutory principles, initially rejected Caltrans’s contention that new section 14130, subdivision (a)(5), makes Caltrans’s use of private consultants to assist in project delivery a “new state function” exempt from the civil service mandate. (See Williams, supra, 7 Cal.App.3d at p. 397.) As we subsequently explain, that holding seems clearly correct in light of the uncontradicted evidence of Caltrans’s historical responsibility for project development of the state highway system. Next, the Court of Appeal majority considered and accepted Caltrans’s alternate argument that, by reason of Chapter 433, although Caltrans’s private contracting at issue here involves services that state civil service employees have traditionally done, nonetheless, it will result in greater efficiency and economy without compromising the integrity of the civil service. In so holding, the Court of Appeal relied heavily on legislative findings and declarations that purport to justify Caltrans’s contracting activities. (See §§ 14130, 14130.1, subd. (b), 14130.3.) In the Court of Appeal majority’s view, these findings and declarations override or replace the trial court’s earlier findings that Caltrans’s inability to perform projects through the state civil service was caused by its own policy of inadequate staffing. As the majority opinion stated, “. . . the trial court ignored legislative findings justifying the maintenance of Caltrans’s staff at levels that will not necessitate costly short-term hirings and layoffs due to workload fluctuations resulting from the volatility of funding sources.” (Fn. omitted.) The Court of Appeal relied on case law presuming the validity of legislation and according “great weight” to legislative findings unless “unreasonable and arbitrary” or “clearly and palpably wrong.” (See, e.g., Amwest Surety Ins. Co. v. Wilson (1995) 11 Cal.4th 1243, 1252 [48 Cal.Rptr.2d 12, 906 P.2d 1112]; Lockard v. City of Los Angeles (1949) 33 Cal.2d 453, 461 [202 P.2d 38, 7 A.L.R.2d 990]; see also American Bank & Trust Co. v. Community Hospital (1984) 36 Cal.3d 359, 372 [204 Cal.Rptr. 671, 683 P.2d 670, 41 A.L.R.4th 233] [not proper judicial function to reweigh legislative facts underlying statutes].) According to the Court of Appeal majority, nothing in the record supports a conclusion that the legislative findings were clearly and palpably wrong. In the majority’s view, “The burden is not on Caltrans to prove the facts support the legislative determination but on plaintiffs, i.e. those who attack the statute, to prove they do not. Judicial notice of prior factual determinations of the superior court does not satisfy plaintiffs’ burden inasmuch as circumstances may have changed in the interim.” Similarly, the Court of Appeal majority found “nothing in the record to support the superior court’s assertion the Legislature failed to consider whether additional civil service staff could be obtained to perform the project delivery work adequately, competently or satisfactorily. The court may not simply rely on its finding preceding enactment of Chapter 433 that any inadequacy of staff was caused by a policy and practice of maintaining staff at an artificially low level. The undisputed fact remains, as found by the Legislature, that at the time Chapter 433 was enacted staff was inadequate to perform the work. Regardless of the reasons why this condition had existed, the Legislature was not precluded from legislating based on then-existing circumstances. There is nothing in the record to refute the implicit legislative finding that sufficient additional staff could not be obtained on a cost-effective basis.” (Italics added, fn. omitted.) Responding to the trial court’s doubts regarding the supposed “short-term” nature of the seismic safety retrofit program, the Court of Appeal majority reasoned that, although this program may be comparable to any typical Caltrans project, it “has a finite life. Presumably, after all bridges are retrofitted as needed, the program will terminate. Thus it is not unreasonable for the Legislature to find it would be more economical to contract out such work than to hire additional staff who must then be laid-off when the short-term retrofit program is completed.” The Court of Appeal next addressed the trial court’s conclusion that section 14137 (directing Caltrans to continue contracts in force or awarded on or before July 1, 1993) is invalid because it purports to override the court’s injunction without stating facts establishing the contracts at issue satisfied the civil service mandate. According to the Court of Appeal majority, the new section by itself satisfied Caltrans’s earlier failure of proof: “In section 14137, the Legislature has found the facts and circumstances justify each of the designated contracts. In effect, the Legislature has relieved Caltrans of the burden of presenting evidence to justify the individual contracts. In so doing, the Legislature has not overridden the superior court’s earlier determination but has supplied the factual basis the superior court determined was lacking. Consistent with the previously discussed rules of judicial review of legislative enactments, we presume the facts and circumstances support the Legislature’s implied findings absent contrary evidence.” (Italics added.) Relying on CSEA, supra, 199 Cal.App.3d at pages 851 through 853, the Court of Appeal majority reasoned that the Legislature properly could find that, under present conditions, certain highway construction projects, even though existing state functions, cannot be performed “adequately, competently or satisfactorily” by state employees, but can be performed “efficiently and economically” if privately contracted. “This is entirely consistent with the civil service mandate, a key purpose of which is to encourage efficiency and economy in state government. [Citation.]” Accordingly, the Court of Appeal majority concluded that Chapter 433 is constitutional “on its face,” reserving the question whether its provisions are “now or will be applied constitutionally.” The court also concluded that the Caltrans activities that the trial court’s 1990 injunction prohibited “appear to be consistent with the objects and purposes of [Chapter 433] as set out expressly in legislative findings and declarations, the underlying factual bases of which were not competently challenged in the superior court. As such, they may not be enjoined absent a showing the statute is improperly applied contrary to its terms or in derogation of the civil service mandate.” The Court of Appeal ordered the 1990 injunction dissolved and the matter remanded to the trial court for further proceedings. VIII. The Court of Appeal Dissent Justice Blease wrote a lengthy dissent. He preceded his analysis with this succinct, and we believe accurate, description of the private contracting restriction in article VII: “History has shown that patronage hiring of public employees corrupts the political process, leads to waste, and depletes the quality of the public workforce. The People enacted article VII to avoid this. Early on the California Supreme Court recognized that the civil service provisions will not work if the merit appointment system can be circumvented by simply contracting out civil service jobs.” The dissent reviewed the history of the proceedings in this case and observed that, “[u]nable to make headway with the judicial branch’s tiresome requirement that Caltrans produce evidence that contracting out was warranted as cheaper or more efficient, Caltrans sought a sanction from the Legislature for its practice of contracting out. The result is Chapter 433.” In the dissent’s view, the Court of Appeal majority relied exclusively and improperly on an implied legislative finding of cost-effectiveness to permit Caltrans to resume private contracting without requiring it to prove that contracting is more economical or efficient than using state civil service employees. The dissent observed that in reaffirming its 1990 injunction, the trial court found that Caltrans’s “ ‘contracting activity during 1993-94 is contributing to the displacement of permanent, temporary and part-time civil service staff in the performance of project development work.’ ” According to the dissent, Caltrans did not challenge this new finding, but has relied entirely on the provisions of Chapter 433. The dissent believed that “[t]he majority would permit contracting out without adherence to any of the safeguard criteria developed in the case law. This total break with precedent is not warranted by Chapter 433. It is questionable whether a statute constitutionally could expressly bar the application of these safeguards. ... [H It would raise serious constitutional questions if we construed a statute to bar the safeguards against patronage developed in the case law, including the safeguard that the state be prepared to prove in a judicial forum that contracting out is warranted by considerations of economy or efficiency. The case law is grounded in a constitutional provision enacted to overcome a pernicious tendency inherently afflicting both of the political branches of the government. “However, this question is not presented by Chapter 433. No provision of Chapter 433 alters the traditional burden of proof that the government show that contracting out is warranted by considerations of economy or efficiency. Accordingly, there is no valid basis for a claim that Chapter 433 conflicts with the injunction because it imposes this burden upon the state.” (Fns. omitted.) The dissent next analyzed the four principal substantive changes in Chapter 433 on which the majority relied as allowing Caltrans to contract various work privately without proof of cost savings or added efficiency. In the dissent’s view, each statutory change conflicts with the earlier findings and conclusions in the trial court’s injunction and orders. As the dissent explained, “The trial court had determined the rights and obligations of the parties to this litigation under contracts entered into under the law preceding Chapter 433. The state did not appeal and the decision is final. The conclusion is inescapable that the Legislature has encroached upon the judicial power because it seeks to undo a final judicial determination of those rights and obligations.” The dissent next addressed the majority’s claim that legislative findings in Chapter 433 included an implied finding that private contracting would permit Caltrans to operate more efficiently and cost-effectively than hiring state workers. The dissent disagreed, stating that “We are bound by the trial court’s factual determination that the necessity to contract out, if any, arises out of an artificial, political constraint on the hiring of new civil service staff. In the many proceedings which produced the injunction and enforcement, Caltrans, the administrative agency which is the necessary source of evidence that contracting out is cost-effective, has been unable to provide any such evidence. How then could we plausibly imply that the Legislature in enacting Chapter 433 made an implied finding that contracting out is cost-effective? If the Legislature predicated Chapter 433 on such a finding how could it fail to assert this among the plethora of cryptic, illogical, and untenable express findings and declarations?” IX. Discussion As the Court of Appeal majority recognized, granting, denying, dissolving, or refusing to dissolve a permanent or preliminary injunction rests in the sound discretion of the trial court upon a consideration of all the particular circumstances of each individual case, and the trial court’s judgment will not be modified or dissolved on appeal except for an abuse of discretion. (Salazar v. Eastin (1995) 9 Cal.4th 836, 850 [39 Cal.Rptr.2d 21, 890 P.2d 43] (Salazar).) Recent legislation authorizes a court to modify or dissolve an injunction or temporary restraining order “upon a showing that there has been a material change in the facts upon which the injunction or temporary restraining order was granted, that the law upon which the injunction or temporary restraining order was granted has changed, or that the ends of justice would be served by the modification or dissolution of the injunction or temporary restraining order.” (Code Civ. Proc., § 533; accord, Civ. Code, § 3424, subd. (a) [grounds for modifying or dissolving “final injunction”]; see also Salazar, supra, 9 Cal.4th at p. 850 [court has inherent power to vacate an injunction upon a showing of a change in controlling law].) In Salazar, the trial court’s injunction was based on “assumptions about the law” that changed when this court filed a new decision. Because the injunction was inconsistent with the new law, the trial court did not abuse its discretion in vacating it. (See Salazar, supra, 9 Cal.4th at p. 850.) Thus, the principal question before us is whether the trial court abused its discretion in failing to modify or dissolve its earlier injunction in light of Chapter 433’s subsequently adopted legislative findings and determinations. Caltrans raises the preliminary question whether we should overrule the substantial body of case law holding that article VII restricts private contracting and in this manner free Caltrans from its obligations under the 1990 injunction. As will appear, we conclude that no proper ground exists for overruling the private contracting restriction of prior case law, that the provisions of Chapter 433 on which Caltrans relies conflict with the constitutional principles of this case law, and that, accordingly, the trial court did not abuse its discretion in declining to modify or dissolve its earlier injunction. A. Overruling Riley and its progeny Caltrans first urges us to reconsider and overrule or disapprove the “archaic” Riley decision and the subsequent decisions of this court and the Court of Appeal that have applied, extended, or confined its rule in various contexts. As Caltrans graphically puts it, “[t]he incoherent, unworkable, and potentially crippling tests which encrust and distort article VII are not even hinted at by its language.” Caltrans correctly observes that the private contracting restriction and its exceptions do not appear in the bare language of article VII but derive from judicial interpretation regarding the logical implications of the constitutional provisions. (See CSEA, supra, 199 Cal.App.3d at p. 844.) In Caltrans’s view, Riley erred in inferring from California Constitution, former article XXIV, the predecessor of article VII, that the state is prohibited from using “independent contractors” except in narrow, exceptional situations. According to Caltrans, former article XXIV was simply intended to restrict appointments and promotions in state service except on the basis of merit and competitive examination, in order to avoid favoritism and the “spoils system” in selecting among existing state employees. Caltrans cites various sources in support of its position that the constitutional civil service mandate was not intended to restrict private contracting. For example, the ballot arguments favoring the adoption of the original civil service mandate in 1934 referred to its purpose “to prohibit appointments and promotion in State service except on the basis of merit, efficiency and fitness ascertained by competitive examination.” (Ballot Pamp., Proposed Amends, to Cal. Const, with arguments to voters, Gen. Elec. (Nov. 6, 1934), argument in favor of Prop. 7, p. 12, italics added.) In Riley, we considered and rejected this precise argument, concluding that the civil service mandate does not distinguish between “employees” and “independent contractors,” but is more concerned with whether the civil service staff could perform the services involved. (Riley, supra, 9 Cal.2d at p. 135; accord, Burum v. State Compensation Ins. Fund, supra, 30 Cal.2d at pp. 579-580.) As an analytical matter, Riley's rule seems appropriate to assure that the state civil service is not neglected, diminished, or destroyed through routine appointments to “independent contractors” made solely on the basis of political considerations or cronyism. (See Williams, supra, 7 Cal.App.3d at p. 397 [Riley rule “emanates from an implicit necessity for protecting the policy of the organic civil service mandate against dissolution and destruction”]; CSEA, supra, 199 Cal.App.3d at pp. 846-847 [dual purposes of article VII are to promote efficiency and economy in state government, and to eliminate the “ ‘spoils system’ ” of political patronage]; see also Comment, Contracting With the State Without Meeting Civil Service Requirements (1957) 45 Cal.L.Rev. 363, 364 [“The inclusion of independent contractors is of vital importance as it cuts off a wide area of possible subversion of the civil service system.”].) As plaintiffs observe, “Were the rule otherwise, the civil service system could be entirely undone by a system of contracting; and the state’s work force could be dominated by independent contractors who would be hired from job to job.” Such a system, operating without regard to considerations of economy or efficiency, and open to a “patronage/spoils system” method of contracting, would conflict with the electorate’s probable intent in adopting article VII and its predecessor. Moreover, even assuming for the sake of argument that Riley’s constitutional interpretation was originally flawed, under settled rules of construction we must presume that Riley’s interpretation was preserved and reincorporated into the Constitution on two subsequent occasions when (1) in 1970, the voters reenacted an amended version of former article XXIV pursuant to the recommendation of the California Constitution Revision Commission, and (2) in 1976, the voters adopted the substance of former article XXIV as new article VII. (See Sarracino v. Superior Court (1974) 13 Cal.3d 1, 8 [118 Cal.Rptr. 21, 529 P.2d 53] [adoption of constitutional language similar to that in former constitutional provision is presumed to incorporate authoritative judicial construction of former language]; cf. In re Harris (1989) 49 Cal.3d 131, 136 [260 Cal.Rptr. 288, 775 P.2d 1057] [drafters of initiative measure, and voters adopting it, are deemed to know judicial construction of law serving as its source].) In this connection, we note that in 1966, in summarizing its recommendations with regard to the proposed revision of former article XXIV, the California Constitution Revision Commission stated: “The first question discussed in considering Article XXIV was whether the matters treated in the article, and particularly the enumeration of exemptions [from civil service] in Section 4, ought to be retained in the Constitution. It was concluded that California has one of the best civil service systems in the nation and that constitutional treatment of the basic elements of the system is essential to insure continuance of its high quality. It was recognized, for example, that the alternative of placing the entire exemption power with the Legislature would [subject] the legislators to unduly severe pressures to carve out various exceptions to the application of civil service laws and that much strain on the integrity and efficacy of the civil service system could result.” (Cal. Const. Revision Com., Proposed Revision (1966) p. 109.) Thus, the California Constitution Revision Commission considered and rejected an approach that would have given the Legislature open-ended authority to create exemptions from civil service in any area in which the Legislature felt that public policy would be served better by an alternative to the civil service system. We believe this “legislative history” of the current civil service provisions of the California Constitution supports both the retention of the constitutional principle established in Riley and our conclusion that the principle embodied in Riley operates to constrain the actions of the Legislature as well as of the executive branch. Caltrans likewise criticizes Riley's progeny and the creation of such extensions or modifications as the “new state function” rule (see Williams, supra, 7 Cal.App.3d at pp. 397-399) and the “cost savings” rule (see CSEA, supra, 199 Cal.App.3d at pp. 851-853). In Caltrans’s view, the rules these cases announced are unsupported by the bare language of the civil service mandate and constitute further judicial legislation. Assuming Riley's premise is correct, however, and the Constitution indeed limits private contracting, these subsequent cases seem reasonable, practical interpretations of the general constitutional provision. As we explained in a case interpreting another constitutional measure, “. . . we deal with a constitutional provision [Cal. Const., art. XIII A] of a kind, similar to many others, which necessarily and over a period of time will require judicial, legislative and administrative construction. This is a fairly common procedure.” (Amador Valley Joint Union High Sch. Dist. v. State Bd. of Equalization (1978) 22 Cal.3d 208, 244 [149 Cal.Rptr. 239, 583 P.2d 1281].) Moreover, “. . . California courts have held that constitutional and other enactments must receive a liberal, practical common-sense construction which will meet changed conditions and the growing needs of the people. [Citations.]” (Id. at p. 245.) Caltrans asserts supposed policy reasons why we should overrule or disapprove 60 years of settled case law: “As a result [of the existing case law], Californians have had to forego promising new techniques for providing services, ranging from contracting with private contractors to outright privatization. This has made more expensive by possibly billions of dollars the delivery of services in California. It also puts lives at risk. For example, the inability to use private engineering firms would threaten the timely completion of the seismic retrofit of California bridges and overpasses.” First, although these reasons, if factually based, might support a constitutional amendment to clarify, or indeed abrogate, the private contracting restriction, they offer no solid ground for ignoring traditional principles of stare decisis. (See, e.g., Moradi-Shalal v. Fireman’s Fund Ins. Companies (1988) 46 Cal.3d 287, 296-297 [250 Cal.Rptr. 116, 758 P.2d 58].) Caltrans points to no new legal developments, such as scholarly criticism or commentary, or contrary case law in other states, that would cast doubt on the continued vitality of Riley and its progeny. Although Caltrans asserts that many other states allow private contracting, our review of the sister state decisions indicates that, like California, most of these states have substantial restrictions and “efficiency and economy” requirements to protect their civil service systems from deterioration through private contracting. (See, e.g., Hall v. City of Tuscaloosa (Ala. 1982) 421 So.2d 1244, 1249; Moore v. State, Dept. of Transp. (Alaska 1994) 875 P.2d 765, 768-773; Colorado Ass’n of Pub. Emp. v. D.O.H. (Colo. 1991) 809 P.2d 988, 992-998; Jack A. Parker & Assoc., Inc. v. State, etc. (La.Ct.App. 1984) 454 So.2d 162, 165-167; Michigan State Employees v. Civil Service Com’n (1985) 141 Mich.App. 288 [367 N.W.2d 850, 852]; University of Nevada v. State Employees Ass’n, Inc. (1974) 90 Nev. 105 [520 P.2d 602, 604-607]; Nassau Educ. Chap. v. Great Neck U. Free Sch. (1981) 85 A.D.2d 733 [445 N.Y.S.2d 812, 813]; Carter v. Ohio Dept. of Health (1986) 28 Ohio St.3d 463 [504 N.E.2d 1108, 1109-1110]; Local 4501, Comm. Workers v. Ohio State Univ. (1984) 12 Ohio St.3d 274 [466 N.E.2d 912, 914-915]; Stump v. Dept. of Labor & Industry (1993) 154 Pa.Commw. 471 [624 A.2d 229, 231]; Teamsters Local 117 v. King County (1994) 76 Wn.App. 18 [881 P.2d 1059, 1061-1062]; Wash. Fed., etc. v. Spokane Community Coll. (1978) 90 Wn.2d 698 [585 P.2d 474, 475]; see also Kaplan, The Law of Civil Service (1958) pp. 98-99; Becker, With Whose Hands: Privatization, Public Employment, and Democracy (1988) 6 Yale L. & Pol’y Rev. 88, 99-103; Comment, Contracting With the State Without Meeting Civil Service Requirements, supra, 45 Cal.L.Rev. at pp. 364-365; Note, State Civil Service Law—Civil Service Restrictions on Contracting Out by State Agencies (1980) 55 Wash. L.Rev. 419, 434-435, fns. 76-84, and cases cited (Civil Service Note).) Caltrans acknowledges that although the federal government “actively encourages” private contracting, applicable legislation calls for “policies, procedures, and practices which will provide the Government with property and services of the requisite quality, within the time needed, at the lowest reasonable cost” (41 U.S.C. former § 401(2), italics added; see Diebold v. U.S. (6th Cir. 1991) 947 F.2d 787, 789 [federal procurement rules require agencies to acquire goods and services at lowest possible cost to taxpayer].) In short, the Riley decision and its progeny seem typical of the restraints many other jurisdictions, including the federal government, have imposed on private contracting. The single critical commentary Caltrans cited was directed toward a State of Washington decision, Wash. Fed., etc. v. Spokane Community Coll., supra, 585 P.2d 474, enforcing Washington’s civil service “merit system” legislation to invalidate a private contract despite a substantial cost savings to the state. (See Civil Service Note, supra, 55 Wash. L.Rev. 419.) The student commentator proposed a modified rule that would permit private contracting in good faith to achieve “improved economy.” (Id. at p. 440.) As we have seen, the California courts already permit private contracting if cost savings justify it and other applicable civil service standards are met. (CSEA, supra, 199 Cal.App.3d at pp. 851-853.) Caltrans suggests that the “nature of the services,” and “new state function” tests are difficult to apply and can lead to anomalous results. But Caltrans fails to offer any alternatives short of simply abrogating the private contracting restriction in its entirety. We are not prepared to take that step and disregard three decades of jurisprudence applying and construing the constitutional provision. Second, Caltrans overstates its case substantially in claiming that Riley and its progeny’s undue restrictions on private contracting or privatization threaten fiscal responsibility and public safety. As we have seen, applicable case law allows the state to contract privately if the civil service is unable to perform the work “adequately and competently.” (Riley, supra, 9 Cal.2d at p. 135.) This broad and flexible exception clearly includes the expense and safety considerations Caltrans cites. As the amicus curiae brief of various county transportation agencies correctly observes, Riley’s test “is broad enough to permit contracting out where the nature of the task is such that the civil service could not perform the task efficiently, or quickly enough, or with the same degree of skill. There is nothing in Riley to suggest that personnel shortages, earthquakes, economic efficiencies, new state functions, higher skills, etc., would not be within the meaning of this exception.” Additionally, nothing in the record supports Caltrans’s assertions that restrictions on private contracting cause additional expense or safety risks. As plaintiffs observe, “. . . there is no evidence in the record to support Caltrans’ bare claim that the use of contracts ‘results in faster and less expensive service delivery. ’ [Citation.] Caltrans never even contended such in the trial court, much less produced any evidence showing such to be the case [citation].” (Fn. omitted.) Finally, as we have explained, contrary to Caltrans’s assumption, the civil service mandate does not preclude outright privatization of an existing state function. (Professional Engineers, supra, 13 Cal.App.4th at pp. 593-595, and fn. 4.) That case involved the total withdrawal of a state function on an experimental basis, requiring no expenditure of state funds. Similar experimentation may be permissible under article VII, if justified by considerations of economy and efficiency and if otherwise consistent with applicable civil service requirements, despite the use of state funding. (See CSEA, supra, 199 Cal.App.3d at pp. 844-846.) The present case involves no withdrawal of a state function, however, and as will appear, the provisions of Chapter 433 are too far-reaching in scope to qualify as an “experiment.” Finding that none of Caltrans’s policy arguments favoring reconsideration of Riley has substantial merit, we therefore decline to overrule or disapprove Riley and its progeny. B. Effect of Chapter 433 We turn then to the question whether Chapter 433 affords an independent basis for overturning the trial court’s injunction and enforcement orders. Preliminarily, we observe that the trial court’s injunction of April 17, 1990, has become final, and it binds the parties to this litigation unless Chapter 433 provides ground for dissolving it. As we have frequently explained, the collateral estoppel doctrine precludes relitigation of an issue previously adjudicated by final judgment between the parties. (See, e.g., Producers Dairy Delivery Co. v. Sentry Ins. Co. (1986) 41 Cal.3d 903, 910 [226 Cal.Rptr. 558, 718 P.2d 920].) Caltrans has never challenged the trial court’s earlier findings and conclusions regarding its noncompliance with the private contracting restriction. Apart from seeking to abrogate Riley et al., Caltrans raises no challenges independent of Chapter 433 at this time. We therefore limit our present discussion to the effect of Chapter 433 on the trial court’s injunction and subsequent enforcement orders. 1. No express or implied legislative findings justify vacating the injunction As the Court of Appeal dissent observes, Chapter 433 contains no express or implied legislative findings that would justify vacating the trial court’s injunction. By adopting Chapter 433, the Legislature has made clear it prefers private contracting in the areas it mentioned, but legislative preference affords no proper ground for excusing a constitutional violation that a trial court’s final judgment previously enjoined. Although courts must give legislative findings great weight and should uphold them unless unreasonable or arbitrary, “. . . we also must enforce the provisions of our Constitution and ‘may not lightly disregard or blink at ... a clear constitutional mandate.’ [Citation.]’’ (Amwest Surety Ins. Co. v. Wilson, supra, 11 Cal.4th at p. 1252, quoting fro