Bill Text: CA SB14 | 2011-2012 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: State Budget.

Spectrum: Slight Partisan Bill (Democrat 17-8)

Status: (Vetoed) 2012-03-01 - Consideration of Governor's veto stricken from file. [SB14 Detail]

Download: California-2011-SB14-Amended.html

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BILL NUMBER: SB 14	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  AUGUST 25, 2011
	AMENDED IN SENATE  MAY 19, 2011
	AMENDED IN SENATE  MARCH 17, 2011

INTRODUCED BY   Senators Wolk, DeSaulnier, and Huff
   (Principal coauthors: Senators Alquist and Rubio)
   (Principal coauthors: Assembly Members  Blumenfield, 
Bonilla, Buchanan,  Dickinson,  Fletcher, Gordon, and Olsen)

   (  Coauthor:   Senator  
Harman   Coauthors:   Senators  
Correa   and Harman  )
   (Coauthors: Assembly Members  Alejo,   Allen, 
 Beall,   Bill Berryhill,  Block,  Feuer, 
 Galgiani,  Harkey, Huffman,  Nielsen,  and
Wagner)

                        DECEMBER 6, 2010

   An act to add Sections  9147.8   13335.1
 , 13335.3,  and 13335.5   13335.5, and
13335.7  to the Government Code, relating to the State Budget.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 14, as amended, Wolk. State Budget.
   (1) The California Constitution requires the Governor to submit
annually to the Legislature a budget itemizing state expenditures and
estimating state revenues and requires the Legislature to pass the
Budget Bill by midnight on June 15.
   This bill would require that the budget submitted by the Governor
to the Legislature for the  2014-15   2013-14
 fiscal year and each fiscal year thereafter  , as specified
in a plan developed by the Department of Finance and distributed to
the appropriate committees of the Legislature by August 1, 2012,
 be developed pursuant to performance-based budgeting, as
defined, for each state agency.
   (2) Under existing law, a state agency for which an appropriation
is made is generally required to submit to the Department of Finance
for approval a complete and detailed budget setting forth all
proposed expenditures and estimated revenues for the ensuing fiscal
year.
   The bill would require the budget of a state agency, as defined,
submitted to the department  as specified in the plan developed
by the department,  to utilize performance-based budgeting for
all programs, as defined to include those performed not only by state
agencies, but by local agencies, contractors, or others that have a
material relationship with the state, or its authorities and
activities. For those programs not administered by the state, but
which confer a benefit that would not otherwise  occur
  be conferred  but for the action of state
government, state departments would be required to develop a process
for consulting with responsible local agencies, contractors or other
responsible entities, and stakeholders to develop information related
to performance standards and program performance. The bill would
require the department to include specified performance-based
budgeting information in the Governor's budget proposal and to post
that information on the department's Internet Web site.  The
bill would authorize a committee designated by the Legislature,
utilizing the recommendations of specified entities, to propose
legislative changes to those programs.  
    The bill also would establish a task force comprised of the
Director of Finance, the Controller, and the chairpersons and vice
chairpersons of the Senate Committee on Budget and Fiscal Review and
Assembly Committee on Budget to review and comment on
performance-based budgeting guidelines and procedures, to be used by
state agencies in developing performance-based budgets, to review and
comment on a training program for state agency personnel involved in
the performance-based budgeting process developed by the Department
of Finance, and to review and comment on a plan developed by the
department for phasing in performance-based budgeting, which plan
would be required to ensure that such budgeting would be in use by
the 2012-13 fiscal years, giving priority to those programs that were
a part of the 2011-12 realignment project. 
   Implementation of the  bill's provisions  
requirement to use performance-   based budgeting for
departments and programs  would be contingent on an
appropriation of funding for  its purposes  
that requirement  in the annual Budget Act.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
   
  SECTION 1.    It is the intent of the Legislature
in enacting this measure during the 2011-12 Regular Session to
provide a system of analysis that supports a results-oriented
framework for the delivery of public services. That framework should
prioritize understanding the results of programs and funding that are
subject to a transfer of authority and responsibility from state
government to county governments. 
  SEC. 2.    Section 9147.8 is added to the
Government Code, to read:
   9147.8.  (a) Not later than one year after the effective date of
the act that added this section, the Legislature shall designate a
committee of the Legislature, which may be a new joint committee
created for this purpose or an existing joint committee, to adopt a
process, schedule, and deadline for reviewing the performance of all
programs at least once every 10 years, and the designated committee
shall undertake that review. The schedule shall provide for reviewing
programs with expenditures that total one-third or more of total
expenditures by July 1, 2015, and that total two-thirds of total
expenditures by January 1, 2018. For purposes of this section,
"expenditures" include appropriations from all varieties of funds as
reflected in the Budget Bill submitted by the Governor, and statutory
exemptions, deductions, credits, or exclusions from taxes or fees
that would otherwise apply. For purposes of this act, "expenditures"
also shall include the revenue and expenditures of state departments
that are not reflected in the Budget Bill. The process established by
the designated committee to review the performance of public
programs shall reflect the principles of performance-based budgeting
and shall include the participation of the Senate Committee on Budget
and Fiscal Review and the Assembly Committee on Budget.
   (b) Not later than six months prior to the deadline for review of
each program, the committee designated pursuant to subdivision (a)
shall refer the information on an initial program review to the
appropriate policy committees of each house of the Legislature. For
programs with common objectives, the reviews may be combined. Not
later than 90 days prior to the deadline, the policy committees shall
make recommendations regarding a program to the designated
committee. The review by the designated committee may be based on the
recommendations of the policy committees, as well as recommendations
that may be made by the Milton Marks "Little Hoover" Commission on
California State Government Organization and Economy, the Legislative
Analyst, the Bureau of State Audits, or the public. As part of its
recommendations to the Legislature, the Bureau of State Audits shall
identify those programs that pose the greatest financial risks to the
state. If following the review of one or more programs the
designated committee determines that statutory changes are necessary,
the designated committee may propose legislation that includes, but
is not limited to, one or more of the following:
   (1) Modifications to the program that will reduce costs.
   (2) Modifications to the program that will improve outcomes.
   (3) Reorganization of the program by consolidating it with
programs that have similar objectives.
   (4) Termination of the program, provided that if a program is
recommended for termination, an analysis shall include the potential
benefits if performance is improved, the relationship between the
program and desired public outcomes, and the impact of eliminating
that program. The analysis of impacts of elimination shall include
ramifications on related outcomes, the potential to increase the
burden and fiscal impact on other public programs, and the potential
impact on future budgets.
   (c) Proposed legislation shall be submitted to the Committee on
Rules of each house of the Legislature for referral to the
appropriate policy committee for public hearing and further action.
   (d) The designated committee shall post on an Internet Web site
its recommendations and the results of the Legislature's action.
   (e) "Performance-based budgeting" has the same meaning as set
forth in subdivision (d) of Section 13335.3.
   (f) For the purposes of this section, "program" includes statutory
or constitutional provisions that authorize services, regulate
activities, evaluate services and programs, provide preferences in
the tax system, or otherwise confer a benefit that would not
otherwise occur were it not for the action of the state government,
including the procedures used to administer those programs, whether
performed by state agencies, local agencies, contractors, or others
that have a material relationship with the state or its authorities
and activities, or that have a fiscal effect on the state. 
   SECTION 1.    Section 13335.1 is added to the 
 Government Code   , to read:  
   13335.1.  (a) It is the intent of the Legislature in enacting
Sections 13335.3, 13335.5, and 13335.7 to provide a system of
analysis that supports a results-oriented framework for the delivery
of public services and the operation of state departments and
programs. That framework should prioritize understanding the results
of programs and funding that are subject to a transfer of authority
and responsibility from state government to county governments.
   (b) The Legislature hereby finds and declares the following:
   (1) State government must focus on the outcomes of public policy
decisions and public programs to ensure opportunities are available
for all Californians to achieve a high quality of life.
   (2) The Legislature must ensure that policymakers, public program
administrators, and rank-and-file state workers have access to
relevant and timely information so that they can make informed
decisions in the design and delivery of public programs.
   (3) The focus of that information must be on the goals of those
public programs and the performance of the public agencies in
administering those programs.
   (4) Goal and performance information should be widely available,
relevant, and timely for informing budget, policy, and oversight
decisions.
   (5) In order to identify performance measurements relevant to
budget, policy, and oversight decisionmaking, public agencies must
consult with the public, rank-and-file state workers, supervisors,
and other officials responsible for the delivery of public programs.
   (6) Performance measurements, including information on outcomes
and other metrics relevant to improving those outcomes, should be
designed to ensure that limited public resources are well spent.
   (7) Establishing goal, performance, and outcome information for
public programs should be part of a systematic review of the
effectiveness and efficiency of those programs.
   (8) Goal, performance, and outcome information should be made
widely available to the public.
   (9) Goal, performance, and outcome information should be used in
the annual budget and policy-making process to inform fiscal and
policy decisions and by the Legislature to enhance oversight of
public programs and to ensure results-based accountability.
   (10) As a component of legislative oversight, goal, performance,
and outcome information should be used to identify programs that
require fundamental reforms to improve outcomes and programs subject
to elimination because they are ineffective. 
   SEC. 3.   SEC. 2.   Section 13335.3 is
added to the Government Code, to read:
   13335.3.  (a)  As used in this article, "performance-based
budgeting" means a system of budgeting that uses information on
performance to inform resource allocation decisions, thereby
establishing clear accountability. 
    (b)    The purpose of performance-based
budgeting is to inform policy, fiscal, and oversight decisions by the
Governor and Members of the Legislature; to focus managers,
supervisors, and rank-and-file workers on achieving desired goals;
and to communicate to the public the value of public programs,
progress toward desired results, and the choices available to improve
the expenditure of public funds. 
   (b) 
    (c)  Every state agency for which an appropriation has
been made shall submit to the department for approval a complete and
detailed budget at the time and in the form prescribed by the
 department, setting   plan developed by the
department pursuant to Section 13335.5 that sets  forth all
proposed expenditures and estimated revenues for the ensuing fiscal
year. 
   (c) The budget 
    (d)     Budgets  submitted to the
department  and proposed by the Governor  
pursuant to subdivision (c)  shall use performance-based
budgeting  methods that   to  make 
it  clear to policymakers and the public the value and
results of existing operations and proposed changes. 
   (d) As used in this article, "performance-based budgeting" means a
system of budgeting that uses information on performance to inform
resource allocation decisions, thereby establishing clear
accountability. 
   (e) A  performance-based budget   budget
using performance-based   budgeting  shall identify and
update all of the following:
   (1) The mission and goals of the agency.
   (2) The activities and programs focused on achieving those goals.
   (3) Performance metrics that reflect desired outcomes for existing
and proposed activities and a targeted performance level for the
following year.
   (4) Prior-year performance data and an explanation of deviation
from previous-year targets.
   (5) Proposed changes in statute, including the creation of
incentives or elimination of disincentives that could improve
outcomes or hold down costs.
   (6) A description of the impacts and consequences to  the
current recipients or beneficiaries of   parties
affected by  a program proposed for modification or elimination.

   (f) The Governor's Internet Web site shall provide a summary of
each state agency's mission, goals, prior-year performance, and
future-year objectives.  
   SEC. 4.  Section 13335.5 is added to the Government Code, to read:
 
   13335.5.  (a) Not later than the 2014-15 fiscal year, and each
fiscal year thereafter, the budget submitted by the Governor to the
Legislature, as required by Section 12 of Article IV of the
California Constitution, shall be developed by utilizing
performance-based budgeting methods.  
   (b) The amount of each appropriation made in the Budget Act for
the 2014-15 fiscal year, and each fiscal year thereafter, for
expenditure by any state agency shall be determined after considering
performance-related data. When the Budget Bill is submitted by the
Governor, he or she shall include performance standards for that
budget in a separate document. These standards shall be applied to
each state agency, and should allow the public and policymakers to
understand the effectiveness and efficiency of each program. For
those programs that are not administered by the state, but which
confer a benefit that would not otherwise occur were it not for the
action of the state government, departments shall develop a process
for consulting with the responsible local agencies, contractors or
other responsible entities, and stakeholders to develop information
related to performance standards and program performance. 

   (c) The department shall include performance-based budgeting
information in the Governor's budget proposal, in both printed and
electronic formats if prepared, and post the information on its
Internet Web site where it routinely posts budget information. That
information shall include, but not be limited to, information on all
of the following:  
   (1) The mission and goals of each agency provided spending
authority in the budget proposal.  
   (2) The activities and programs focused on achieving those goals.
 
   (3) Performance metrics that reflect desired outcomes for existing
and proposed activities and a targeted performance level for the
following year.  
   (4) Prior-year performance data and an explanation of deviation
from previous-year targets.  
   (5) A description of the impacts and consequences to the current
recipients or beneficiaries of a program proposed for modification or
elimination.  
   (d) The Legislative Analyst's Office shall review the adequacy of
performance metrics and progress toward targeted outcomes in
preparing its review of the Governor's Budget proposal. 

   (e) A task force consisting of the director, the Controller, and
the chairpersons and vice chairpersons of the Senate Committee on
Budget and Fiscal Review and the Assembly Committee on Budget shall
do all of the following:  
   (1) Review and comment on guidelines and procedures drafted by the
department to be used by state agencies in developing
performance-based budgets pursuant to Sections 13320 and 13335.3. The
guidelines shall describe how state employees will be involved in
establishing and implementing performance standards. 

   (2) Review and comment on a training program developed by the
department for appropriate executive branch personnel to ensure the
successful implementation of performance-based budgeting and
management by state agencies.  
   (3) Review and comment on a plan prepared by the department for
systematically phasing in the requirements of Sections 13320 and
13335.3. The plan should ensure that, by the 2012-13 fiscal year,
performance-based budgeting methods are used in preparing, reviewing,
and enacting one-third or more of the total General Fund
expenditures as proposed in the Governor's Budget for that fiscal
year. Priority shall be given to those programs that were part of the
2011-12 realignment project as enacted.  
   (f) For purposes of this article, "state agency" means any agency,
department, or other entity of the executive branch of the state
that is required to submit a budget pursuant to Article 2 (commencing
with Section 13320).  
   SEC. 5.  Implementation of this act is contingent on an
appropriation of funding for its purposes in the annual Budget Act.
 
   (f) Performance-based budgeting shall be used by each state agency
as specified in the plan submitted by the department pursuant to
Section 13335.5 and shall allow the public and policymakers to
understand the effectiveness and efficiency of each program. For
those programs that are not administered by the state, but that
confer a benefit that would not otherwise be conferred were it not
for the action of the state government, departments shall develop a
process for consulting with the responsible local agencies,
contractors or other responsible entities, and stakeholders to
develop information related to performance standards and program
performance.  
   (g) The department shall include performance-based budgeting
information in the Governor's budget proposal, as specified in
Section 13335.7, in both printed and electronic formats if prepared,
and post the information on its Internet Web site where it routinely
posts budget information. That information shall include, but not be
limited to, information on all of the following:  
   (1) The mission and goals of each agency provided spending
authority in the budget proposal.  
   (2) The activities and programs focused on achieving those goals.
 
   (3) Performance metrics that reflect desired outcomes for existing
and proposed activities and a targeted performance level for the
following year.  
   (4) Prior-year performance data and an explanation of deviation
from previous-year targets.  
   (5) A description of the impacts and consequences to parties
affected by a program proposed for modification or elimination.
   SEC. 3.    Section 13335.5 is added to the  
Government Code   , to read:  
   13335.5.  No later than August 1, 2012, the Department of Finance
shall prepare and distribute to the appropriate committees of the
Legislature, and to the Legislative Analyst's Office, a plan and a
timeline to implement the requirements of Section 13335.3, including
information on strategies and a timeline for the integration of
performance-based budgeting into the FISCal system as defined by
Chapter 7 (commencing with Section 15849.20) of Part 10b of Title 2,
as follows:
   (a) The plan shall identify those departments and programs for
which performance-based budgeting shall be used beginning with the
development of the Governor's budget for fiscal year 2013-14, and
shall specify the rate of expansion in the number of departments and
programs for which performance-based budgeting is to be used in
subsequent years.
   (b) The plan and timeline shall describe how state employees and
other affected parties will be involved in establishing and
implementing performance standards.
   (c) The plan shall identify training needs and opportunities to
ensure that state employees have appropriate opportunities for
education, training, and support to ensure the successful
implementation of performance-based budgeting and management by state
agencies. 
   SEC. 4.    Section 13335.7 is added to the 
Government Code   , to read:  
   13335.7.  (a) Beginning with the budget submitted by the Governor
to the Legislature pursuant to Section 12 of Article IV of the
California Constitution for the 2013-14 fiscal year, the department
shall require the use of performance-based budgeting for those
departments and programs required by the plan submitted by the
department to the Legislature pursuant to Section 13335.5 to use
performance-based budgeting for the applicable fiscal year.
   (b) The budget submitted by the Governor to the Legislature
pursuant to Section 12 of Article IV of the California Constitution
for the 2018-19 fiscal year, and for every fiscal year thereafter,
shall be developed for each program and department using
performance-based budgeting.
   (c) The Legislative Analyst's Office shall review the adequacy of
performance metrics and progress toward targeted outcomes in
preparing its review of the Governor's Budget proposal.
   (d) For purposes of Sections 13335.3 and 13335.5, "state agency"
means any agency, department, or other entity of the executive branch
of the state that is required to submit a budget pursuant to Article
2 (commencing with Section 13320). 
   SEC. 5.    Implementation of Section 13335.7 of the
Government Code is contingent on an appropriation of funding for its
purposes in the annual Budget Act.