Bill Text: CA SB64 | 2011-2012 | Regular Session | Amended
Bill Title: State mandates: school district test claims: procedure.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-01-31 - Returned to Secretary of Senate pursuant to Joint Rule 56. [SB64 Detail]
Download: California-2011-SB64-Amended.html
BILL NUMBER: SB 64 AMENDED BILL TEXT AMENDED IN SENATE APRIL 26, 2011 AMENDED IN SENATE APRIL 6, 2011 INTRODUCED BY Senator Liu JANUARY 5, 2011 An act to amend Sections 17553, 17554, 17557, 17557.1, 17557.2, and 17574 of, and to add Sections 17553.1 and 17553.2 to, the Government Code, relating to state mandates. LEGISLATIVE COUNSEL'S DIGEST SB 64, as amended, Liu. State mandates: school district test claims: procedure. Under the California Constitution, whenever the Legislature or a state agency mandates a new program or higher level of service on any local government, including school districts, the state is required to provide a subvention of funds to reimburse the local government, with specified exceptions. Existing law establishes a test claim procedure for local governmental agencies to file claims for reimbursement of these costs with the Commission on State Mandates. This bill would revise these provisions to require the commission to adopt procedures for receiving test claims from school districts that eliminate specified existing requirements. The bill would require the commission to create a school district test claim advisory committee, with a prescribed membership, for the purpose of consulting with commission staff regarding specified information relating to a school district test claim. The bill would require the commission staff to prepare an analysis of the test claim and a proposed statement of decision for consideration by the commission, as specified. The bill would also require the advisory committee to prepare and submit the parameters and guidelines for an approved test claim to the commission for approval on behalf of a school district claimant, as specified. 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. Section 17553 of the Government Code is amended to read: 17553. (a) The commission shall adopt procedures for receiving claims filed by a local agency pursuant to this article and Section 17574 and for providing a hearing on those claims. The procedures shall do all of the following: (1) Provide for presentation of evidence by the claimant, the Department of Finance, and any other affected department or agency, and any other interested person. (2) Ensure that a statewide cost estimate is adopted within 12 months after receipt of a test claim, when a determination is made by the commission that a mandate exists. This deadline may be extended for up to six months upon the request of either the claimant or the commission. (3) Permit the hearing of a claim to be postponed at the request of the claimant, without prejudice, until the next scheduled hearing. (b) All test claims shall be filed by a local agency on a form prescribed by the commission and shall contain at least the following elements and documents: (1) A written narrative that identifies the specific sections of statutes or executive orders and the effective date and register number of regulations alleged to contain a mandate and shall include all of the following: (A) A detailed description of the new activities and costs that arise from the mandate. (B) A detailed description of existing activities and costs that are modified by the mandate. (C) The actual increased costs incurred by the claimant during the fiscal year for which the claim was filed to implement the alleged mandate. (D) The actual or estimated annual costs that will be incurred by the claimant to implement the alleged mandate during the fiscal year immediately following the fiscal year for which the claim was filed. (E) A statewide cost estimate of increased costs that all local agencies will incur to implement the alleged mandate during the fiscal year immediately following the fiscal year for which the claim was filed. (F) Identification of all of the following: (i) Dedicated state funds appropriated for this program. (ii) Dedicated federal funds appropriated for this program. (iii) Other nonlocal agency funds dedicated for this program. (iv) The local agency's general purpose funds for this program. (v) Fee authority to offset the costs of this program. (G) Identification of prior mandate determinations made by the Commission on State Mandates or a predecessor agency that may be related to the alleged mandate. (H) Identification of a legislatively determined mandate pursuant to Section 17573 that is on the same statute or executive order. (2) The written narrative shall be supported with declarations under penalty of perjury, based on the declarant's personal knowledge, information, or belief, and signed by persons who are authorized and competent to do so, as follows: (A) Declarations of actual or estimated increased costs that will be incurred by the claimant to implement the alleged mandate. (B) Declarations identifying all local, state, or federal funds, or fee authority that may be used to offset the increased costs that will be incurred by the claimant to implement the alleged mandate, including direct and indirect costs. (C) Declarations describing new activities performed to implement specified provisions of the new statute or executive order alleged to impose a reimbursable state-mandated program. Specific references shall be made to chapters, articles, sections, or page numbers alleged to impose a reimbursable state-mandated program. (D) If applicable, declarations describing the period of reimbursement and payments received for full reimbursement of costs for a legislatively determined mandate pursuant to Section 17573, and the authority to file a test claim pursuant to paragraph (1) of subdivision (c) of Section 17574. (3) (A) The written narrative shall be supported with copies of all of the following: (i) The test claim statute that includes the bill number or executive order, alleged to impose or impact a mandate. (ii) Relevant portions of state constitutional provisions, federal statutes, and executive orders that may impact the alleged mandate. (iii) Administrative decisions and court decisions cited in the narrative. (B) State mandate determinations made by the Commission on State Mandates or a predecessor agency and published court decisions on state mandate determinations made by the Commission on State Mandates are exempt from this requirement. (4) A test claim shall be signed at the end of the document, under penalty of perjury by the claimant or its authorized representative, with the declaration that the test claim is true and complete to the best of the declarant's personal knowledge, information, or belief. The date of signing, the declarant's title, address, telephone number, facsimile machine telephone number, and electronic mail address shall be included. (c) If a completed test claim is not received by the commission within 30 calendar days from the date that an incomplete test claim was returned by the commission, the original test claim filing date may be disallowed, and a new test claim may be accepted on the same statute or executive order. (d) In addition, the commission shall determine whether an incorrect reduction claim is complete within 10 days after the date that the incorrect reduction claim is filed. If the commission determines that an incorrect reduction claim is not complete, the commission shall notify the local agency that filed the claim stating the reasons that the claim is not complete. The local agency shall have 30 days to complete the claim. The commission shall serve a copy of the complete incorrect reduction claim on the Controller. The Controller shall have no more than 90 days after the date the claim is delivered or mailed to file any rebuttal to an incorrect reduction claim. The failure of the Controller to file a rebuttal to an incorrect reduction claim shall not serve to delay the consideration of the claim by the commission. (e) The term "local agencies" does not include a school district, which shall submit a test claim in the manner prescribed by Section 17553.1. SEC. 2. Section 17553.1 is added to the Government Code, to read: 17553.1. (a) The commission shall adopt procedures for receiving claims filed by a school district pursuant to this article and Section 17574 and for providing a hearing on those claims. The procedures shall do all of the following: (1) Provide for presentation of evidence by the claimant, the Department of Finance, and any other affected department or agency, and any other interested person. (2) Ensure that a statement of decision, including a statewide cost estimate, is adopted within 12 months after receipt of a test claim, when a determination is made by the commission that a mandate exists. (3) Permit the hearing of a claim to be postponed at the request of the claimant, without prejudice, until the next scheduled hearing. (b) All test claims shall be filed by the school district on a form prescribed by the commission and shall contain at least the following elements and documents: (1) A written narrative that identifies the specific sections of statutes or executive orders and the effective date and register number of regulations alleged to contain a mandate and shall include a detailed description of the new activities and costs that arise from the mandate. (2) The written narrative shall be supported with declarations under penalty of perjury, based on the declarant's personal knowledge, information, or belief, and signed by persons who are authorized and competent to do so, as follows: (A) Declarations of actual or estimated increased costs that will be incurred by the claimant to implement the alleged mandate. (B) Declarations describing new activities performed to implement specified provisions of the new statute or executive order alleged to impose a reimbursable state-mandated program. (3) A test claim shall be signed at the end of the document, under penalty of perjury by the claimant or its authorized representative, with the declaration that the test claim is true and complete to the best of the declarant's personal knowledge, information, or belief. The date of signing, the declarant's title, address, telephone number, facsimile machine telephone number, and electronic mail address shall be included. (c) If a completed test claim is not received by the commission within 30 calendar days from the date that an incomplete test claim was returned by the commission, the original test claim filing date may be disallowed, and a new test claim may be accepted on the same statute or executive order. (d) In addition, the commission shall determine whether an incorrect reduction claim is complete within 10 days after the date that the incorrect reduction claim is filed. If the commission determines that an incorrect reduction claim is not complete, the commission shall notify the school district that filed the claim stating the reasons that the claim is not complete. The school district shall have 30 days to complete the claim. The commission shall serve a copy of the complete incorrect reduction claim on the Controller. The Controller shall have no more than 90 days after the date the claim is delivered or mailed to file any rebuttal to an incorrect reduction claim. The failure of the Controller to file a rebuttal to an incorrect reduction claim shall not serve to delay the consideration of the claim by the commission. SEC. 3. Section 17553.2 is added to the Government Code, to read: 17553.2. (a) The commission shall establish a school district test claim advisorycommittee.committee comprised of no more than seven members. The focus of the advisory committee shall be to provide the commission with recommendations relating to school district test claims, incorrect reduction claims, and other duties as prescribed in this chapter. The membership of the advisory committee shall be selected by, and serve at the pleasure of, the commission, and include officials from the Department of Finance, the State Department of Education, and the Controller's office, and representatives of school agencies, including, but not limited to, chief business officials, board members, and superintendents. Commission staff shall provide technical expertise and other support for the advisory committee. (b) Within three months of a school district filing a test claim, the commission staff shall consult with the advisory committee regarding each of the following: (1) Any new activities and costs, or modifications of existing activities and costs, that allegedly arise from the specific statutes or executive orders that are identified in the test claim. (2) A statewide cost estimate of increased costs that school districts will incur to implement the alleged mandate during the fiscal year for which the claim was filed. (3) Identification of all of the following: (A) Dedicated state funds appropriated for this program. (B) Dedicated federal funds appropriated for this program. (C) Other nonlocal agency funds dedicated for this program. (4) Identification of prior mandate determinations made by the commission or a predecessor agency that may be related to the alleged mandate. (5) Identification of a legislatively determined mandate pursuant to Section 17573 that is on the same statute or executive order. (c) The commission staff shall prepare an analysis and a proposed statement of decision for consideration by the commission for each test claim filed by a school district. Commission staff shall provide the legal analysis necessary for the commission to make a determination whether the statutes or executive orders specified in the test claim contain reimbursable mandates. The analysis shall include, where appropriate, recommendations from the advisory committee regarding activities and costs arising from the statutes or executive orders identified in the test claim, including, but not limited to, the information contained in paragraphs (2) to (5), inclusive, of subdivision (b). (d) The commission shall issue a statement of decision, including a statewide cost estimate, within 12 months of the filing of a test claim by a school district, as required by Section 17553.1, if the commission determines that a mandate exists. SEC. 4. Section 17554 of the Government Code is amended to read: 17554. With the agreement of all parties to the claim, the commission may waive the application of any procedural requirement imposed by this chapter or pursuant to Sections 17553, 17553.1, and 17553.2. The authority granted by this section includes the consolidation of claims and the shortening of time periods. SEC. 5. Section 17557 of the Government Code is amended to read: 17557. (a) If the commission determines there are costs mandated by the state pursuant to Section 17551, it shall determine the amount to be subvened to local agencies and school districts for reimbursement. In so doing it shall adopt parameters and guidelines for reimbursement of any claims relating to the statute or executive order. For purposes of a test claim filed by a local agency, the successful test claimants shall submit proposed parameters and guidelines within 30 days of adoption of a statement of decision on a local agency test claim. For purposes of a test claim filed by a school district, the advisory committee established pursuant to Section 17553.2 shall develop proposed parameters and guidelines on behalf of a school district claimant and shall submit the proposed parameters and guidelines within 30 days of adoption of a statement of decision on a school district test claim, for final adoption by the commission within the timeframe established by paragraph (2) of subdivision (a) of Section 17553.1. The proposed parameters and guidelines may include proposed reimbursable activities that are reasonably necessary for the performance of the state-mandated program. At the request of a successful local agency test claimant or the school district test claim advisory committee, the commission may provide for one or more extensions of this 30-day period at any time prior to its adoption of the parameters and guidelines. For purposes of a local agency test claim, if proposed parameters and guidelines are not submitted within the 30-day period and the commission has not granted an extension, then the commission shall notify the test claimant that the amount of reimbursement the test claimant is entitled to for the first 12 months of incurred costs will be reduced by 20 percent, unless the test claimant can demonstrate to the commission why an extension of the 30-day period is justified. (b) In adopting parameters and guidelines, the commission may adopt a reasonable reimbursement methodology. For purposes of a school district test claim, it shall be the policy of the state for the commission to adopt parameters and guidelines reflecting the following preferences in serial order:(1) A unit rate reasonable reimbursement methodology.(2) A standard rate reasonable reimbursement methodology as appropriate to a particular mandate.(3) Actual cost parameters and guidelines.(1) A unit rate reimbursement methodology including, but not limited to, a uniform reimbursement amount per average daily attendance or specified activity. (2) A standard reimbursement methodology including, but not limited to, reimbursement for costs related to defined amounts of employee time per specified activities or based on a uniform formula or formulas for costs related to specified activities. (3) An actual cost reimbursement methodology, with reimbursement only for actual costs related to specified activities. (c) The parameters and guidelines adopted by the commission shall specify the fiscal years for which local agencies and school districts shall be reimbursed for costs incurred. However, the commission may not specify in the parameters and guidelines any fiscal year for which payment could be provided in the annual Budget Act. (d) (1) A local agency, school district, the advisory committee established by Section 17553.2, or the state may file a written request with the commission to amend the parameters or guidelines. The commission may, after public notice and hearing, amend the parameters and guidelines. A parameters and guidelines amendment submitted within 90 days of the claiming deadline for initial claims, as specified in the claiming instructions pursuant to Section 17561, shall apply to all years eligible for reimbursement as defined in the original parameters and guidelines. A parameters and guidelines amendment filed more than 90 days after the claiming deadline for initial claims, as specified in the claiming instructions pursuant to Section 17561, and on or before the claiming deadline following a fiscal year, shall establish reimbursement eligibility for that fiscal year. (2) For purposes of this subdivision, the request to amend parameters and guidelines may be filed to make any of the following changes to parameters and guidelines, consistent with the statement of decision: (A) Delete any reimbursable activity that has been repealed by statute or executive order after the adoption of the original or last amended parameters and guidelines. (B) Update offsetting revenues and offsetting savings that apply to the mandated program and do not require a new legal finding that there are no costs mandated by the state pursuant to subdivision (e) of Section 17556. (C) Include or amend a reasonable reimbursement methodology for all or some of the reimbursable activities. (D) Clarify what constitutes reimbursable activities. (E) Add new reimbursable activities that are reasonably necessary for the performance of the state-mandated program. (F) Define what activities are not reimbursable. (G) Consolidate the parameters and guidelines for two or more programs. (H) Amend the boilerplate language. For purposes of this section, "boilerplate language" means the language in the parameters and guidelines that is not unique to the state-mandated program that is the subject of the parameters and guidelines. (e) A test claim shall be submitted on or before June 30 following a fiscal year in order to establish eligibility for reimbursement for that fiscal year. The claimant may thereafter amend the test claim at any time, but before the test claim is set for a hearing, without affecting the original filing date as long as the amendment substantially relates to the original test claim. (f) In adopting parameters and guidelines, the commission shall consult with the Department of Finance, the affected state agency, the Controller, the fiscal and policy committees of the Assembly and Senate, the Legislative Analyst, and the claimants to consider a reasonable reimbursement methodology that balances accuracy with simplicity. (g) The advisory committee established pursuant to Section 17553.2 shall review the parameters and guidelines for a school district test claim at least once every three years. If the advisory committee determines that the parameters and guidelines require revision, the advisory committee shall propose revisions to be considered by the commission by filing a written request in the manner prescribed by this section. SEC. 6. Section 17557.1 of the Government Code is amended to read: 17557.1. (a) Notwithstanding any other provision of this part, within 30 days of the commission's adoption of a statement of decision on a test claim, the Department of Finance and either the local agency test claimant or the school district test claim advisory committee, respectively, may notify the executive director of the commission in writing of their intent to follow the process described in this section to develop a reasonable reimbursement methodology and statewide estimate of costs for the initial claiming period and budget year for reimbursement of costs mandated by the state in accordance with the statement of decision. The letter of intent shall include the date on which the Department of Finance and the local agency test claimant or the school district test claim advisory committee will submit a plan to ensure that costs from a representative sample of eligible local agency or school district claimants are considered in the development of a reasonable reimbursement methodology. (b) This plan shall also include all of the following information: (1) The date on which the Department of Finance and the local agency test claimant or the school district test claim advisory committee will provide to the executive director an informational update regarding their progress in developing the reasonable reimbursement methodology. (2) The date on which the Department of Finance and the local agency test claimant or the school district test claim advisory committee will submit to the executive director the draft reasonable reimbursement methodology and proposed statewide estimate of costs for the initial claiming period and budget year. This date shall be no later than 180 days after the date the letter of intent is sent by the test claimant and Department of Finance to the executive director. (c) At the request of the Department of Finance and the local agency test claimant or the school district test claim advisory committee, the executive director may provide for up to four extensions of this 180-day period. (d) The Department of Finance, the local agency test claimant, or the school district test claim advisory committee may notify the executive director at any time that the claimant, advisory committee, or Department of Finance no longer intends to develop a reasonable reimbursement methodology pursuant to this section. In this case, paragraph (2) of subdivision (a) of Section 17553 and Section 17557 shall apply to a local agency test claim, and paragraph (2) of subdivision (a) of Section 17553.1 and Section 17557 shall apply for a school district test claim. Upon receipt of this notification, the executive director shall notify the local agency test claimant or the school district test claim advisory committee, as appropriate, of the duty to submit proposed parameters and guidelines within 30 days under subdivision (a) of Section 17557. SEC. 7. Section 17557.2 of the Government Code is amended to read: 17557.2. (a) A reasonable reimbursement methodology developed pursuant to Section 17557.1 or a joint request for early termination of a reasonable reimbursement methodology shall have broad support from a wide range of local agencies or school districts. The Department of Finance and the local agency test claimant or the school district test claim advisory committee may demonstrate broad support from a wide range of local agencies or school districts in different ways, including, but not limited to, obtaining endorsement by one or more statewide associations of local agencies or school districts and securing letters of approval from local agencies or school districts. (b) No later than 60 days before a commission hearing, the Department of Finance and the local agency test claimant or the school district test claim advisory committee shall submit to the commission a joint proposal that shall include all of the following: (1) The draft reasonable reimbursement methodology. (2) The proposed statewide estimate of costs for the initial claiming period and budget year. (3) A description of the steps the Department of Finance and the local agency test claimant or the school district test claim advisory committee undertook to determine the level of support by local agencies or school districts for the draft reasonable reimbursement methodology. (4) An agreement that the reasonable reimbursement methodology developed and approved under this section shall be in effect for a period of five years unless a different term is approved by the commission, or upon submission to the commission of a letter indicating the Department of Finance and the local agency test claimant's or school district test claim advisory committee's joint interest in early termination of the reasonable reimbursement methodology. (5) An agreement that, at the conclusion of the period established in paragraph (4), the Department of Finance and the local agency test claimant or the school district test claim advisory committee will consider jointly whether amendments to the methodology are necessary. (c) The commission shall approve the draft reasonable reimbursement methodology if review of the information submitted pursuant to Section 17557.1 and subdivision (b) of this section demonstrates that the draft reasonable reimbursement methodology and statewide estimate of costs for the initial claiming period and budget year have been developed in accordance with Section 17557.1 and meet the requirements of subdivision (a). The commission thereafter shall adopt the proposed statewide estimate of costs for the initial claiming period and budget year. Statewide cost estimates adopted under this section shall be included in the report to the Legislature required under Section 17600 and shall be reported by the commission to the appropriate Senate and Assembly policy and fiscal committees, the Legislative Analyst, and the Department of Finance not later than 30 days after adoption. (d) Unless amendments are proposed pursuant to this subdivision, the reasonable reimbursement methodology approved by the commission pursuant to this section shall expire after either five years, any other term approved by the commission, or upon submission to the commission of a letter indicating the Department of Finance's and the local agency test claimant's or school district test claim advisory committee's joint interest in early termination of the reasonable reimbursement methodology. (e) The commission shall approve a joint request for early termination of a reasonable reimbursement methodology if the request meets the requirements of subdivision (a). If the commission approves a joint request for early termination, the commission shall notify the local agency test claimant or school district test claim advisory committee of the duty to submit proposed parameters and guidelines to the commission pursuant to subdivision (a) of Section 17557. (f) At least one year before the expiration of a reasonable reimbursement methodology, the commission shall notify the Department of Finance and the test claimant or school district test claim advisory committee that they may do one of the following: (1) Jointly propose amendments to the reasonable reimbursement methodology by submitting the information described in paragraphs (1), (3), and (4) of subdivision (b), and providing an estimate of the mandate's annual cost for the subsequent budget year. (2) Jointly propose that the reasonable reimbursement methodology remain in effect. (3) Allow the reasonable reimbursement methodology to expire and notify the commission that the local agency test claimant or school district test claim advisory committee will submit proposed parameters and guidelines to the commission pursuant to subdivision (a) of Section 17557 to replace the reasonable reimbursement methodology. (g) The commission shall either approve the continuation of the reasonable reimbursement methodology or approve the jointly proposed amendments to the reasonable reimbursement methodology if the information submitted in accordance with paragraph (1) of subdivision (f) demonstrates that the proposed amendments were developed in accordance with Section 17557.1 and meet the requirements of subdivision (a) of this section. SEC. 8. Section 17574 of the Government Code is amended to read: 17574. (a) A local agency or school district agrees to the following terms and conditions when it accepts reimbursement for a legislatively determined mandate pursuant to Section 17573: (1) Any unpaid reimbursement claims the local agency or school district has previously filed with the Controller pursuant to Section 17561 and derived from parameters and guidelines or reasonable reimbursement methodology shall be deemed withdrawn if they are on the same statute or executive order of a legislatively determined mandate and for the same period of reimbursement. (2) The payment of the amount agreed upon pursuant to Section 17573 constitutes full reimbursement of its costs for that mandate for the applicable period of reimbursement. (3) The methodology upon which the payment is calculated is an appropriate reimbursement methodology for the term specified in subdivision (e) of Section 17573. (4) A test claim filed with the commission by a local agency or school district on the same statute or executive order as a legislatively determined mandate shall be withdrawn. (5) A test claim on the same statute or executive order as a legislatively determined mandate will not be filed with the commission except as provided in subdivision (c). (b) If a local agency or school district rejects reimbursement for a legislatively determined mandate pursuant to Section 17573, a local agency or school district may take over a withdrawn test claim within six months after the date the test claim is withdrawn, by substitution of parties and compliance with the filing requirements in subdivision (b) of Section 17553 or subdivision (b) of Section 17553.1, as specified in the commission's notice of withdrawal. (c) (1) Notwithstanding Section 17551 and subdivision (b) of Section 17573, a local agency or school district may file a test claim on the same statute or executive order as a legislatively determined mandate if one of the following applies: (A) The Legislature amends the reimbursement methodology and the local agency or school district rejects reimbursement. (B) The term of the legislatively determined mandate, as defined in subdivision (e) of Section 17573, has expired. (C) The term of the legislatively determined mandate, as defined in subdivision (e) of Section 17573, is amended and the local agency or school district rejects reimbursement under the new term. (D) The mandate is subject to subdivision (b) of Section 6 of Article XIII B and the Legislature does both of the following: (i) Fails to appropriate in the Budget Act funds to reimburse local agencies for the full payable amount that has not been previously paid based on the reimbursement methodology enacted by the Legislature. (ii) Does not repeal or suspend the mandate pursuant to Section 17581. (2) A test claim filed pursuant to the authority granted by this subdivision shall be filed within six months of the date an action described in subparagraph (A), (B), (C), or (D) of paragraph (1) occurs. (d) Notwithstanding any other provision of this section, a local agency or school district shall not file a test claim pursuant to this section if the statute of limitations specified in subdivision (c) of Section 17551 expired before the date a legislatively determined mandate was adopted by the Legislature pursuant to Section 17573. (e) Notwithstanding the period of reimbursement specified in subdivision (e) of Section 17557, a test claim filed pursuant to this section shall establish eligibility for reimbursement beginning with the fiscal year of an action described in subparagraph (A), (B), (C), or (D) of paragraph (1) of subdivision (c).