BILL NUMBER: SB 662	CHAPTERED
	BILL TEXT

	CHAPTER  159
	FILED WITH SECRETARY OF STATE  AUGUST 9, 2001
	APPROVED BY GOVERNOR  AUGUST 8, 2001
	PASSED THE SENATE  JULY 21, 2001
	PASSED THE ASSEMBLY  JUNE 29, 2001
	AMENDED IN ASSEMBLY  JUNE 25, 2001

INTRODUCED BY   Committee on Judiciary (Senators Escutia (Chair),
Kuehl, O'Connell, Peace, and Sher)

                        FEBRUARY 23, 2001

   An act to amend Sections 27, 113, 130, 144, 350, 1647.11, 2570.6,
2570.8, 2570.19, 2995, 3059, 3364, 3403, 4059, 4312, 4980.80,
4980.90, 4996.6, 5111, 5536, 6403, 6716, 6730.2, 6756, 7092, 7583.11,
8027, 8773.4, 10167.2, and 21702 of the Business and Professions
Code, to amend Sections 1748.10, 1748.11, 1810.21, 2954.4, 2954.5,
and 3097 of, and to amend and renumber Section 1834.8 of, the Civil
Code, to amend Sections 403.020, 645.1, 674, and 699.510 of the Code
of Civil Procedure, to amend Sections 9323, 9331, and 9408 of the
Commercial Code, to amend Sections 2200, 6810, 17540.3, 25102, 25103,
and 25120 of the Corporations Code, to amend Sections 313, 406, 426,
427, 11700, 17071.46, 17210, 17317, 17610.5, 22660, 22950, 25933,
33126.1, 37252, 37252.2, 37619, 41329.1, 42239, 44114, 45023.1,
48664, 52054, 52270, 52485, 54749, 56045, 56845, 69432.7, 69434.5,
69437.6, 69439, 69613.1, 87164, and 92901 of, and to amend and
renumber Sections 45005.25 and 45005.30 of, the Education Code, to
amend Sections 1405, 8040, 9118, and 15375 of the Elections Code, to
amend Section 17504 of the Family Code, to amend Sections 761.5,
4827, 16024, 16501, and 18586 of the Financial Code, to amend
Sections 1506, 2921, and 8276.3 of the Fish and Game Code, to amend
Sections 492, 6046, and 75131 of the Food and Agricultural Code, to
amend Sections 3543.4, 3562.2, 3583.5, 6254, 6516.6, 6599.2, 7074,
18935, 20028, 20300, 20392, 21006, 21547.7, 30064.1, 31461.3,
31681.55, 31835.02, 38773.6, 55720, 65584, 65585.1, and 75059.1 of
the Government Code, to amend Sections 444.21, 1358.11, 11836,
11877.2, 17922, 25358.6.1, 39619.6, 104170, 105112, 111656.5,
111656.13, 114145, 123111, and 124900 of, to amend and renumber
Section 104320 of, and to amend and renumber the heading of Article
10.5 (commencing with Section 1399.801) of Chapter 2.2 of Division 2
of, the Health and Safety Code, to amend Sections 789.8, 1215.1,
1871, 1872.83, 10123.135, 10178.3, 10192.11, 10231.2, 10236, 10506.5,
11621.2, 11784, 11786, 11787, and 12698 of the Insurance Code, to
amend Sections 90.5, 129, 230.1, 4455, and 4609 of the Labor Code, to
amend Section 1048 of the Military and Veterans Code, to amend
Sections 272, 417.2, 646.94, and 3058.65 of the Penal Code, to amend
Sections 1813 and 16062 of the Probate Code, to amend Sections 10129
and 20209.7 of the Public Contract Code, to amend Sections 5090.51,
14581, 36710, and 42923 of the Public Resources Code, to amend
Sections 383.5, 2881.2, 7943, 9608, 9610, and 12702.5 of, and to
amend and renumber Section 399.15 of, the Public Utilities Code, to
amend Sections 75.11, 75.21, 97.3, 214, 23622.8, 23646, 44006, and
45153 of the Revenue and Taxation Code, to amend Section 1110 of the
Unemployment Insurance Code, to amend Section 4000.37 of the Vehicle
Code, to amend Sections 1789.5, 4098.1, 5614, 8102, 10082, 14005.28,
14005.35, 14008.6, 14087.32, and 14105.26 of the Welfare and
Institutions Code, and to amend Section 511 of the San Gabriel Basin
Water Quality Authority Act (Chapter 776 of the Statutes of 1992),
Section 1 of Chapter 352 of the Statutes of 2000, Section 1 of
Chapter 661 of the Statutes of 2000, Section 2 of Chapter 693 of the
Statutes of 2000, Sections 5 and 6 of the Naval Training Center San
Diego Public Trust Exchange Act (Chapter 714 of the Statutes of
2000), Section 228 of Chapter 862 of the Statutes of 2000, and
Sections 2 and 3 of Chapter 975 of the Statutes of 2000, relating to
maintenance of the codes.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 662, Committee on Judiciary.  Maintenance of the codes.
   Existing law directs the Legislative Counsel to advise the
Legislature from time to time as to legislation necessary to maintain
the codes.
   This bill would restate existing provisions of law to effectuate
the recommendations made by the Legislative Counsel to the
Legislature for consideration during 2001, and would not make any
substantive change in the law.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 27 of the Business and Professions Code is
amended to read:
   27.  (a) Every entity specified in subdivision (b), on or after
July 1, 2001, unless otherwise authorized by the Department of
Information Technology pursuant to Executive Order D-3-99, shall
provide on the Internet information regarding the status of every
license issued by that entity in accordance with the California
Public Records Act (Chapter 3.5 (commencing with Section 6250) of
Division 7 of Title 1 of the Government Code) and the Information
Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of
Title 1.8 of Part 4 of Division 3 of the Civil Code).  The public
information to be provided on the Internet shall include information
on suspensions and revocations of licenses issued by the entity and
other related enforcement action taken by the entity relative to
persons, businesses, or facilities subject to licensure or regulation
by the entity.  In providing information on the Internet, each
entity shall comply with the Department of Consumer Affairs
Guidelines for Access to Public Records.  The information shall not
include personal information, including home telephone number, date
of birth, or social security number.  Each entity shall disclose a
licensee's address of record.  However, each entity shall allow a
licensee to provide a post office box number or other alternate
address, instead of his or her home address, as the address of
record.  This section shall not preclude an entity from also
requiring a licensee, who has provided a post office box number or
other alternative mailing address as his or her address of record, to
provide a physical business address or residence address only for
the entity's internal administrative use and not for disclosure as
the licensee's address of record or disclosure on the Internet.
   (b) Each of the following entities within the Department of
Consumer Affairs shall comply with the requirements of this section:

   (1) The Acupuncture Board shall disclose information on its
licensees.
   (2) The Board of Behavioral Sciences shall disclose information on
its licensees, including marriage and family therapists, licensed
clinical social workers, and licensed educational psychologists.
   (3) The Dental Board of California shall disclose information on
its licensees.
   (4) The State Board of Optometry shall disclose information
regarding certificates of registration to practice optometry,
statements of licensure, optometric corporation registrations, branch
office licenses, and fictitious name permits of their licensees.
   (5) The Board for Professional Engineers and Land Surveyors shall
disclose information on its registrants and licensees.
   (6) The Structural Pest Control Board shall disclose information
on its licensees, including applicators, field representatives, and
operators in the areas of fumigation, general pest and wood
destroying pests and organisms, and wood roof cleaning and treatment.

   (7) The Bureau of Automotive Repair shall disclose information on
its licensees, including auto repair dealers, smog stations, lamp and
brake stations, smog check technicians, and smog inspection
certification stations.
   (8) The Bureau of Electronic and Appliance Repair shall disclose
information on its licensees, including major appliance repair
dealers, combination dealers (electronic and appliance), electronic
repair dealers, service contract sellers, and service contract
administrators.
   (9) The Cemetery Program shall disclose information on its
licensees, including cemetery brokers, cemetery salespersons,
crematories, and cremated remains disposers.
   (10) The Funeral Directors and Embalmers Program shall disclose
information on its licensees, including embalmers, funeral
establishments, and funeral directors.
   (11) The Contractors' State License Board shall disclose
information on its licensees in accordance with Chapter 9 (commencing
with Section 7000) of Division 3.
   (12) The Board of Psychology shall disclose information on its
licensees, including psychologists, psychological assistants, and
registered psychologists.
   (c) "Internet" for the purposes of this section has the meaning
set forth in paragraph (6) of subdivision (e) of Section 17538.
  SEC. 2.  Section 113 of the Business and Professions Code is
amended to read:
   113.  Upon recommendation of the director, officers, and employees
of the department, and the officers, members, and employees of the
boards, committees, and commissions comprising it or subject to its
jurisdiction may confer, in this state or elsewhere, with officers or
employees of this state, its political subdivisions, other states,
or the United States, or with other persons, associations, or
organizations as may be of assistance to the department, board,
committee, or commission in the conduct of its work.  The officers,
members, and employees shall be entitled to their actual traveling
expenses incurred in pursuance hereof, but when these expenses are
incurred with respect to travel outside of the state, they shall be
subject to the approval of the Governor and the Director of Finance.

  SEC. 3.  Section 130 of the Business and Professions Code is
amended to read:
   130.  (a) Notwithstanding any other provision of law, the term of
office of any member of an agency designated in subdivision (b) shall
be for a term of four years expiring on June 1.
   (b) Subdivision (a) applies to the following boards or committees:

   (1) The Medical Board of California.
   (2) The California Board of Podiatric Medicine.
   (3) The Physical Therapy Board of California.
   (4) The Board of Registered Nursing.
   (5) The Board of Vocational Nursing and Psychiatric Technicians.
   (6) The State Board of Optometry.
   (7) The California State Board of Pharmacy.
   (8) The Veterinary Medical Board.
   (9) The California Architects Board.
   (10) The Landscape Architect Technical Committee.
   (11) The Board for Professional Engineers and Land Surveyors.
   (12) The Contractors' State License Board.
   (13) The State Board of Guide Dogs for the Blind.
   (14) The Board of Behavioral Sciences.
   (15) The Structural Pest Control Board.
   (16) The Bureau of Electronic and Appliance Repair.
   (17) The Court Reporters Board of California.
   (18) The State Board for Geologists and Geophysicists.
   (19) The State Athletic Commission.
   (20) The Osteopathic Medical Board of California.
   (21) The Respiratory Care Board of California.
   (22) The Acupuncture Board.
   (23) The Board of Psychology.
  SEC. 4.  Section 144 of the Business and Professions Code is
amended to read:
   144.  (a) Notwithstanding any other provision of law, an agency
designated in subdivision (b) shall require an applicant to furnish
to the agency a full set of fingerprints for purposes of conducting
criminal history record checks.  Any agency designated in subdivision
(b) may obtain and receive, at its discretion, criminal history
information from the Department of Justice and the United States
Federal Bureau of Investigation.
   (b) Subdivision (a) applies to the following boards or committees:

   (1) The California Board of Accountancy.
   (2) The State Athletic Commission.
   (3) The Board of Behavioral Sciences.
   (4) The Court Reporters Board of California.
   (5) The State Board of Guide Dogs for the Blind.
   (6) The California State Board of Pharmacy.
   (7) The Board of Registered Nursing.
   (8) The Veterinary Medical Board.
   (9) The Registered Veterinary Technician Committee.
   (10) The Board of Vocational Nursing and Psychiatric Technicians.

   (11) The Respiratory Care Board of California.
   (12) The Hearing Aid Dispensers Advisory Commission.
   (13) The Physical Therapy Board of California.
   (14) The Physician Assistant Committee of the Medical Board of
California.
   (15) The Speech-Language Pathology and Audiology Board.
   (16) The Medical Board of California.
   (17) The Board of Nursing Home Administrators.
   (18) The State Board of Optometry.
   (19) The Acupuncture Board.
   (20) The Cemetery and Funeral Programs.
   (21) The Bureau of Security and Investigative Services.
   (22) The Division of Investigation.
   (23) The Board of Psychology.
   (24) The California Board of Occupational Therapy.
  SEC. 5.  Section 350 of the Business and Professions Code is
amended to read:
   350.  (a) There is hereby created in the Department of Consumer
Affairs an Office of Privacy Protection under the direction of the
Director of Consumer Affairs and the Secretary of the State and
Consumer Services Agency.  The office's purpose shall be protecting
the privacy of individuals' personal information in a manner
consistent with the California Constitution by identifying consumer
problems in the privacy area and facilitating development of fair
information practices in adherence with the Information Practices Act
of 1977 (Chapter 1 (commencing with Section 1798) of Title 1.8 of
Part 4 of Division 3 of the Civil Code).
   (b) The office shall inform the public of potential options for
protecting the privacy of, and avoiding the misuse of, personal
information.
   (c) The office shall make recommendations to organizations for
privacy policies and practices that promote and protect the interests
of California consumers.
   (d) The office may promote voluntary and mutually agreed upon
nonbinding arbitration and mediation of privacy-related disputes
where appropriate.
   (e) The Director of Consumer Affairs shall do all of the
following:
   (1) Receive complaints from individuals concerning any person
obtaining, compiling, maintaining, using, disclosing, or disposing of
personal information in a manner that may be potentially unlawful or
violate a stated privacy policy relating to that individual, and
provide advice, information, and referral, where available.
   (2) Provide information to consumers on effective ways of handling
complaints that involve violations of privacy-related laws,
including identity theft and identity fraud.  If appropriate local,
state, or federal agencies are available to assist consumers with
those complaints, the director shall refer those complaints to those
agencies.
   (3) Develop information and educational programs and materials to
foster public understanding and recognition of the purposes of this
article.
   (4) Investigate and assist in the prosecution of identity theft
and other privacy-related crimes, and, as necessary, coordinate with
local, state, and federal law enforcement agencies in the
investigation of similar crimes.
   (5) Assist and coordinate in the training of local, state, and
federal law enforcement agencies regarding identity theft and other
privacy-related crimes, as appropriate.
   (6) The authority of the office, the director, or the secretary,
to adopt regulations under this article shall be limited exclusively
to those regulations necessary and appropriate to implement
subdivisions (b), (c), (d), and (e).
  SEC. 6.  Section 1647.11 of the Business and Professions Code is
amended to read:
   1647.11.  (a) Notwithstanding subdivision (a) of Section 1647.2,
after December 31, 2000, a dentist may not administer oral conscious
sedation on an outpatient basis to a minor patient unless one of the
following conditions is met:
   (1) The dentist possesses a current license in good standing to
practice dentistry in California and either holds a valid general
anesthesia permit, conscious sedation permit, or has been certified
by the board, pursuant to Section 1647.12, to administer oral
sedation to minor patients.
   (2) The dentist possesses a current permit issued under Section
1638 or 1640 and either holds a valid general anesthesia permit, or
conscious sedation permit, or possesses a certificate as a provider
of oral conscious sedation to minor patients in compliance with, and
pursuant to, this article.
   (b) Certification as a provider of oral conscious sedation to
minor patients expires at the same time the license or permit of the
dentist expires unless renewed at the same time the dentist's license
or permit is renewed after its issuance, unless certification is
renewed as provided in this article.
   (c) This article shall not apply to the administration of local
anesthesia or a mixture of nitrous oxide and oxygen or to the
administration, dispensing, or prescription of postoperative
medications.
  SEC. 7.  Section 2570.6 of the Business and Professions Code is
amended to read:
   2570.6.  An applicant applying for a license as an occupational
therapist or certification as an occupational therapy assistant shall
file with the board a written application provided by the board,
showing to the satisfaction of the board that he or she meets all of
the following requirements:
   (a) That the applicant is in good standing and has not committed
acts or crimes constituting grounds for denial of a license under
Section 480.
   (b) (1) That the applicant has successfully completed the academic
requirements of an educational program for occupational therapists
or occupational therapy assistants that is approved by the board and
accredited by the American Occupational Therapy Association's
Accreditation Council for Occupational Therapy Education (ACOTE).
   (2) The curriculum of an education program for occupational
therapists shall contain the content specifically required in the
ACOTE accreditation standards, including all of the following
subjects:
   (A) Biological, behavioral, and health sciences.
   (B) Structure and function of the human body, including anatomy,
kinesiology, physiology, and the neurosciences.
   (C) Human development throughout the life span.
   (D) Human behavior in the context of sociocultural systems.
   (E) Etiology, clinical course, management, and prognosis of
disease processes and traumatic injuries, and the effects of those
conditions on human functioning.
   (F) Occupational therapy theory, practice, and process that shall
include the following:
   (i) Human performance, that shall include occupational performance
throughout the life cycle, human interaction, roles, values, and the
influences of the nonhuman environment.
   (ii) Activity processes that shall include the following:
   (I) Theories underlying the use of purposeful activity and the
meaning and dynamics of activity.
   (II) Performance of selected life tasks and activities.
   (III) Analysis, adaptation, and application of purposeful activity
as therapeutic intervention.
   (IV) Use of self, dyadic, and group interaction.
   (iii) Theoretical approaches, including those related to
purposeful activity, human performance, and adaptation.
   (iv) Application of occupational therapy theory to practice, that
shall include the following:
   (I) Assessment and interpretation, observation, interviews,
history, and standardized and nonstandardized tests.
   (II) Directing, planning, and implementation, that shall include:
therapeutic intervention related to daily living skills and
occupational components; therapeutic adaptation, including methods of
accomplishing daily life tasks, environmental adjustments,
orthotics, and assistive devices and equipment; health maintenance,
including energy conservation, joint protection, body mechanics, and
positioning; and prevention programs to foster age-appropriate
recommendations to maximize treatment gains.
   (III) Program termination including reevaluation, determination of
discharge, summary of occupational therapy outcome, and appropriate
recommendations to maximize treatment gains.
   (IV) Documentation.
   (v) Development and implementation of quality assurance.
   (vi) Management of occupational therapy service, that shall
include:
   (I) Planning services for client groups.
   (II) Personnel management, including occupational therapy
assistants, aides, volunteers, and level I students.
   (III) Departmental operations, including budgeting, scheduling,
recordkeeping, safety, and maintenance of supplies and equipment.
   (3) The curriculum of an education program for occupational
therapy assistants shall contain the content specifically required in
the ACOTE accreditation standards, including all of the following
subjects:
   (A) Biological, behavioral, and health sciences.
   (B) Structure and function of the normal human body.
   (C) Human development.
   (D) Conditions commonly referred to occupational therapists.
   (E) Occupational therapy principles and skills, that shall include
the following:
   (i) Human performance, including life tasks and roles as related
to the developmental process from birth to death.
   (ii) Activity processes and skills, that shall include the
following:
   (I) Performance of selected life tasks and activities.
   (II) Analysis and adaptation of activities.
   (III) Instruction of individuals and groups in selected life tasks
and activities.
   (iii) Concepts related to occupational therapy practice, that
shall include the following:
   (I) The importance of human occupation as a health determinant.
   (II) The use of self, interpersonal, and communication skills.
   (iv) Use of occupational therapy concepts and skills, that shall
include the following:
   (I) Data collection, that shall include structured observation and
interviews, history, and structured tests.
   (II) Participation in planning and implementation, that shall
include:  therapeutic intervention related to daily living skills and
occupational components; therapeutic adaptation, including methods
of accomplishing daily life tasks, environmental adjustments,
orthotics, and assistive devices and equipment; health maintenance,
including mental health techniques, energy conservation, joint
protection, body mechanics, and positioning; and prevention programs
to foster age-appropriate balance of self-care and work.
   (III) Program termination, including assisting in reevaluation,
summary of occupational therapy outcome, and appropriate
recommendations to maximize treatment gains.
   (IV) Documentation.
   (c) That the applicant has successfully completed a period of
supervised fieldwork experience approved by the board and arranged by
a recognized educational institution where he or she met the
academic requirements of subdivision (b) or arranged by a nationally
recognized professional association.  The fieldwork requirements
shall be as follows:
   (1) For an occupational therapist, a minimum of 960 hours of
supervised fieldwork experience shall be completed within 24 months
of the completion of didactic coursework.
   (2) For an occupational therapy assistant, a minimum of 640 hours
of supervised fieldwork experience shall be completed within 20
months of the completion of didactic coursework.
   (d) That the applicant has passed an examination as provided in
Section 2570.7.
   (e) That the applicant, at the time of application, is a person
over 18 years of age, is not addicted to alcohol or any controlled
substance, and has not committed acts or crimes constituting grounds
for denial of licensure or certification under Section 480.
  SEC. 8.  Section 2570.8 of the Business and Professions Code is
amended to read:
   2570.8.  (a) The board may grant a license or certificate to any
person who applies on or before January 1, 2003, and who met, before
that date, the requirements of Section 2570 as amended by Chapter 361
of the Statutes of 1993.
   (b) The board may grant a license or certificate to any applicant
who presents proof of current licensure as an occupational therapist
or occupational therapy assistant in another state, the District of
Columbia, or territory of the United States, if that jurisdiction
requires standards for licensure considered by the board to meet or
exceed the requirements for licensure or certification under this
chapter.
   (c) An applicant seeking a license or certificate under this
section based on his or her current practice shall submit to the
board all of the following as proof of actual practice within one
year of the effective date of this chapter:
   (1) The applicant's affidavit containing all of the following
information:
   (A) The location and dates of the applicant's employment for the
relevant period.
   (B) A description of the capacity in which the applicant was
employed, including job title and description of specific duties and
the nature of the patients or clientele.
   (C) The name and job title of the applicant's supervisor.
   (2) A written job description.
   (3) The employer's affidavit containing all of the following
information:
   (A) The dates of the applicant's employment for the relevant
period.
   (B) A description of the applicant's specific duties.
   (C) The title of the person completing the affidavit.
   (d) After reviewing the information submitted under subdivision
(c), the board may require additional information necessary to enable
it to determine whether to grant a license or certificate under this
section.
  SEC. 9.  Section 2570.19 of the Business and Professions Code is
amended to read:
   2570.19.  (a) There is hereby created a California Board of
Occupational Therapy, hereafter referred to as the board.  The board
shall enforce and administer this chapter.
   (b) The members of the board shall consist of the following:
   (1) Three occupational therapists who shall have practiced
occupational therapy for five years.
   (2) One occupational therapy assistant who shall have assisted in
the practice of occupational therapy for five years.
   (3) Three public members who shall not be licentiates of the board
or of any board referred to in Section 1000 or 3600.
   (c) The Governor shall appoint the three occupational therapists
and one occupational therapy assistant to be members of the board.
The Governor, the Senate Rules Committee, and the Speaker of the
Assembly shall each appoint a public member.  Not more than one
member of the board shall be appointed from the full-time faculty of
any university, college, or other educational institution.
   (d) All members shall be residents of California at the time of
their appointment.  The occupational therapist and occupational
therapy assistant members shall have been engaged in rendering
occupational therapy services to the public, teaching, or research in
occupational therapy for at least five years preceding their
appointments.
   (e) The public members may not be or have ever been occupational
therapists or occupational therapy assistants or in training to
become occupational therapists or occupational therapy assistants.
The public members may not be related to or have a household member
who is an occupational therapist or an occupational therapy assistant
and may not have had within two years of the appointment a
substantial financial interest in a person regulated by the board.
   (f) The Governor shall appoint two board members for a term of one
year, two board members for a term of two years, and one board
member for a term of three years.  Appointments made thereafter shall
be for four-year terms, but no person shall be appointed to serve
more than two consecutive terms.  Terms shall begin on the first day
of the calendar year and end on the last day of the calendar year or
until successors are appointed, except for the first appointed
members who shall serve through the last calendar day of the year in
which they are appointed, before commencing the terms prescribed by
this section.  Vacancies shall be filled by appointment for the
unexpired term.  The board shall annually elect one of its members as
president.
   (g) The board shall meet and hold at least one regular meeting
annually in the Cities of Sacramento, Los Angeles, and San Francisco.
  The board may convene from time to time until its business is
concluded.  Special meetings of the board may be held at any time and
place designated by the board.
   (h) Notice of each meeting of the board shall be given in
accordance with the Bagley-Keene Open Meeting Act (Article 9
(commencing with Section 11120) of Chapter 1 of Part 1 of Division 3
of Title 2 of the Government Code).
   (i) Members of the board shall receive no compensation for their
services but shall be entitled to reasonable travel and other
expenses incurred in the execution of their powers and duties in
accordance with Section 103.
   (j) The appointing power shall have the power to remove any member
of the board from office for neglect of any duty imposed by state
law, for incompetency, or for unprofessional or dishonorable conduct.

   (k) A loan is hereby authorized from the General Fund to the
Occupational Therapy Fund on or after July 1, 2000, in an amount of
up to one million dollars ($1,000,000) to fund operating, personnel,
and other startup costs of the board.  Six hundred ten thousand
dollars ($610,000) of this loan amount is hereby appropriated to the
board to use in the 2000-01 fiscal year for the purposes described in
this subdivision.  In subsequent years, funds from the Occupational
Therapy Fund shall be available to the board upon appropriation by
the Legislature in the annual Budget Act.  The loan shall be repaid
to the General Fund over a period of up to five years, and the amount
paid shall also include interest at the rate accruing to moneys in
the Pooled Money Investment Account.  The loan amount and repayment
period shall be minimized to the extent possible based upon actual
board financing requirements as determined by the Department of
Finance.
   (l) This section shall become inoperative on July 1, 2006, and, as
of January 1, 2007, is repealed, unless a later enacted statute that
is enacted before January 1, 2007, deletes or extends the dates on
which it becomes inoperative and is repealed.  The repeal of this
section renders the board subject to the review required by Division
1.2 (commencing with Section 473).
  SEC. 10.  Section 2995 of the Business and Professions Code is
amended to read:
   2995.  A psychological corporation is a corporation that is
authorized to render professional services, as defined in Section
13401 of the Corporations Code, so long as that corporation and its
shareholders, officers, directors, and employees rendering
professional services who are psychologists, podiatrists, registered
nurses, optometrists, marriage and family therapists, licensed
clinical social workers, chiropractors, acupuncturists, or physicians
are in compliance with the Moscone-Knox Professional Corporation
Act, this article, and all other statutes and regulations now or
hereafter enacted or adopted pertaining to
                               that corporation and the conduct of
its affairs.
  SEC. 11.  Section 3059 of the Business and Professions Code is
amended to read:
   3059.  (a) It is the intent of the Legislature that the public
health and safety would be served by requiring all holders of
licenses to practice optometry granted under this chapter to continue
their education after receiving their licenses.  The board shall
adopt regulations that require, as a condition to the renewal
thereof, that all holders of licenses submit proof satisfactory to
the board that they have informed themselves of the developments in
the practice of optometry occurring since the original issuance of
their licenses by pursuing one or more courses of study satisfactory
to the board or by other means deemed equivalent by the board.
   (b) The board may, in accordance with the intent of this section,
make exceptions from continuing education requirements for reasons of
health, military service, or other good cause.
   (c) If for good cause compliance cannot be met for the current
year, the board may grant exemption of compliance for that year,
provided that a plan of future compliance that includes current
requirements as well as makeup of previous requirements is approved
by the board.
   (d) The board may require that proof of compliance with this
section be submitted on an annual or biennial basis as determined by
the board.
   (e) The board may adopt regulations to require licensees to
maintain current certification in cardiopulmonary resuscitation.
Training required for the granting or renewal of a cardiopulmonary
certificate shall not be credited towards the requirements of
subdivision (a) or (f).
   (f) An optometrist certified to use therapeutic pharmaceutical
agents pursuant to Section 3041.3 shall complete a total of 50 hours
of continuing education every two years in order to renew his or her
certificate.  Thirty-five of the required 50 hours of continuing
education shall be on the diagnosis, treatment, and management of
ocular disease as follows:  12 hours on glaucoma, 10 hours on ocular
infections, five hours on inflammation and topical steroids, six
hours on systemic medications, and two hours on the use of pain
medications.
   (g) The board shall encourage every optometrist to take a course
or courses in pharmacology and pharmaceuticals as part of his or her
continuing education.
   (h) The board shall consider requiring courses in child abuse
detection to be taken by those licensees whose practices are such
that there is a likelihood of contact with abused or neglected
children.
   (i) The board shall consider requiring courses in elder abuse
detection to be taken by those licensees whose practices are such
that there is a likelihood of contact with abused or neglected elder
persons.
  SEC. 12.  Section 3364 of the Business and Professions Code is
amended to read:
   3364.  (a) Every licensee who engages in the practice of fitting
or selling hearing aids shall have and maintain an established retail
business address to engage in that fitting or selling, routinely
open for service to customers or clients.  The address of the
licensee's place of business shall be registered with the bureau as
provided in Section 3362.
   (b) Except as provided in subdivision (c), if a licensee maintains
more than one place of business within this state, he or she shall
apply for and procure a duplicate license for each branch office
maintained.  The application shall state the name of the person and
the location of the place or places of business for which the
duplicate license is desired.
   (c) A hearing aid dispenser may, without obtaining a duplicate
license for a branch office, engage on a temporary basis in the
fitting or selling of hearing aids at the primary or branch location
of another licensee's business or at a location or facility that he
or she may use on a temporary basis, provided that the hearing aid
dispenser notifies the bureau in advance in writing of the dates and
addresses of those businesses, locations, or facilities at which he
or she will engage in the fitting or selling of hearing aids.
  SEC. 13.  Section 3403 of the Business and Professions Code is
amended to read:
   3403.  A plea or verdict of guilty or a conviction following a
plea of nolo contendere, made to a charge substantially related to
the qualifications, functions, and duties of a hearing aid dispenser
is deemed to be a conviction within the meaning of this article.  The
bureau may order the license suspended or revoked, impose
probationary conditions on a licensee, or may decline to issue a
license, when the time for appeal has elapsed, or the judgment of
conviction has been affirmed on appeal, or when an order granting
probation is made suspending the imposition of sentence, irrespective
of a subsequent order under Section 1203.4 of the Penal Code
allowing the person to withdraw his or her plea of guilty and to
enter a plea of not guilty, or setting aside the verdict of guilty,
or dismissing the accusation, information, or indictment.
  SEC. 14.  Section 4059 of the Business and Professions Code, as
added by Section 5 of Chapter 837 of the Statutes of 2000, is amended
to read:
   4059.  (a) A person may not furnish any dangerous drug, except
upon the prescription of a physician, dentist, podiatrist,
optometrist, or veterinarian.  A person may not furnish any dangerous
device, except upon the prescription of a physician, dentist,
podiatrist, optometrist, or veterinarian.
   (b) This section does not apply to the furnishing of any dangerous
drug or dangerous device by a manufacturer, wholesaler, or pharmacy
to each other or to a physician, dentist, podiatrist, or
veterinarian, or to a laboratory under sales and purchase records
that correctly give the date, the names and addresses of the supplier
and the buyer, the drug or device, and its quantity.  This section
does not apply to the furnishing of any dangerous device by a
manufacturer, wholesaler, or pharmacy to a physical therapist acting
within the scope of his or her license under sales and purchase
records that correctly provide the date the device is provided, the
names and addresses of the supplier and the buyer, a description of
the device, and the quantity supplied.
   (c) A pharmacist, or a person exempted pursuant to Section 4054,
may distribute dangerous drugs and dangerous devices directly to
dialysis patients pursuant to regulations adopted by the board.  The
board shall adopt any regulations as are necessary to ensure the safe
distribution of these drugs and devices to dialysis patients without
interruption thereof.  A person who violates a regulation adopted
pursuant to this subdivision shall be liable upon order of the board
to surrender his or her personal license.  These penalties shall be
in addition to penalties that may be imposed pursuant to Section
4301.  If the board finds any dialysis drugs or devices distributed
pursuant to this subdivision to be ineffective or unsafe for the
intended use, the board may institute immediate recall of any or all
of the drugs or devices distributed to individual patients.
   (d) Home dialysis patients who receive any drugs or devices
pursuant to subdivision (c) shall have completed a full course of
home training given by a dialysis center licensed by the State
Department of Health Services.  The physician prescribing the
dialysis products shall submit proof satisfactory to the manufacturer
or wholesaler that the patient has completed the program.
   (e) A pharmacist may furnish a dangerous drug authorized for use
pursuant to Section 2620.3 to a physical therapist or may furnish
topical pharmaceutical agents authorized for use pursuant to
paragraph (5) of subdivision (a) of Section 3041 to an optometrist.
A record containing the date, name and address of the buyer, and name
and quantity of the drug shall be maintained.  This subdivision
shall not be construed to authorize the furnishing of a controlled
substance.
   (f) A pharmacist may furnish electroneuromyographic needle
electrodes or hypodermic needles used for the purpose of placing wire
electrodes for kinesiological electromyographic testing to physical
therapists who are certified by the Physical Therapy Examining
Committee of California to perform tissue penetration in accordance
with Section 2620.5.
   (g) Nothing in this section shall be construed as permitting a
licensed physical therapist to dispense or furnish a dangerous device
without a prescription of a physician, dentist, podiatrist, or
veterinarian.
   (h) A veterinary food-animal drug retailer shall dispense,
furnish, transfer, or sell veterinary food-animal drugs only to
another veterinary food-animal drug retailer, a pharmacy, a
veterinarian, or to a veterinarian's client pursuant to a
prescription from the veterinarian for food-producing animals.
   (i) This section shall become operative on July 1, 2001.
  SEC. 15.  Section 4312 of the Business and Professions Code, as
added by Section 19 of Chapter 837 of the Statutes of 2000, is
amended to read:
   4312.  (a) The board may void the license of a wholesaler,
pharmacy, or veterinary food-animal drug retailer if the licensed
premises remain closed, as defined in subdivision (e), other than by
order of the board.  For good cause shown, the board may void a
license after a shorter period of closure.  To void a license
pursuant to this subdivision, the board shall make a diligent, good
faith effort to give notice by personal service on the licensee.  If
a written objection is not received within 10 days after personal
service is made or a diligent, good faith effort to give notice by
personal service on the licensee has failed, the board may void the
license without the necessity of a hearing.  If the licensee files a
written objection, the board shall file an accusation based on the
licensee remaining closed.  Proceedings shall be conducted in
accordance with Chapter 5 (commencing with Section 11500) of Part 1
of Division 3 of Title 2 of the Government Code, and the board shall
have all the powers granted in that chapter.
   (b) In the event that the license of a wholesaler, pharmacy, or
veterinary food-animal drug retailer is voided pursuant to
subdivision (a) or revoked pursuant to Article 19 (commencing with
Section 4300), or a wholesaler, pharmacy, medical device retailer, or
veterinary food-animal drug retailer notifies the board of its
intent to remain closed or to discontinue business, the licensee
shall, within 10 days thereafter, arrange for the transfer of all
dangerous drugs and controlled substances or dangerous devices to
another licensee authorized to possess the dangerous drugs and
controlled substances or dangerous devices.  The licensee
transferring the dangerous drugs and controlled substances or
dangerous devices shall immediately confirm in writing to the board
that the transfer has taken place.
   (c) If a wholesaler, pharmacy, or veterinary food-animal drug
retailer fails to comply with subdivision (b), the board may seek and
obtain an order from the superior court in the county in which the
wholesaler, pharmacy, or veterinary food-animal drug retailer is
located, authorizing the board to enter the wholesaler, pharmacy, or
veterinary food-animal drug retailer and inventory and store,
transfer, sell, or arrange for the sale of, all dangerous drugs and
controlled substances and dangerous devices found in the wholesaler,
pharmacy, or veterinary food-animal drug retailer.
   (d) In the event that the board sells or arranges for the sale of
any dangerous drugs, controlled substances, or dangerous devices
pursuant to subdivision (c), the board may retain from the proceeds
of the sale an amount equal to the cost to the board of obtaining and
enforcing an order issued pursuant to subdivision (c), including the
cost of disposing of the dangerous drugs, controlled substances, or
dangerous devices.  The remaining proceeds, if any, shall be returned
to the licensee from whose premises the dangerous drugs or
controlled substances or dangerous devices were removed.
   (1) The licensee shall be notified of his or her right to the
remaining proceeds by personal service or by certified mail, postage
prepaid.
   (2) If a statute or regulation requires the licensee to file with
the board his or her address, and any change of address, the notice
required by this subdivision may be sent by certified mail, postage
prepaid, to the latest address on file with the board and service of
notice in this manner shall be deemed completed on the 10th day after
the mailing.
   (3) If the licensee is notified as provided in this subdivision,
and the licensee fails to contact the board for the remaining
proceeds within 30 calendar days after personal service has been made
or service by certified mail, postage prepaid, is deemed completed,
the remaining proceeds shall be deposited by the board into the
Pharmacy Board Contingent Fund.  These deposits shall be deemed to
have been received pursuant to Chapter 7 (commencing with Section
1500) of Title 10 of Part 3 of the Code of Civil Procedure and shall
be subject to claim or other disposition as provided in that chapter.

   (e) For the purposes of this section, "closed" means not engaged
in the ordinary activity for which a license has been issued for at
least one day each calendar week during any 120-day period.
   (f) Nothing in this section shall be construed as requiring a
pharmacy to be open seven days a week.
   (g) This section shall become operative on July 1, 2001.
  SEC. 16.  Section 4980.80 of the Business and Professions Code is
amended to read:
   4980.80.  The board may issue a license to any person who, at the
time of application, has held for at least two years a valid license
issued by a board of marriage counselor examiners, marriage therapist
examiners, or corresponding authority of any state, if the education
and supervised experience requirements are substantially the
equivalent of this chapter and the person successfully completes the
written and oral licensing examinations administered in this state
and pays the fees specified.  Issuance of the license is further
conditioned upon the person's completion of the following coursework
or training:
   (a) A two semester or three quarter unit course in California law
and professional ethics for marriage, family, and child counselors
that shall include areas of study as specified in Section 4980.41.
   (b) A minimum of seven contact hours of training or coursework in
child abuse assessment and reporting as specified in Section 28 and
any regulations promulgated thereunder.
   (c) A minimum of 10 contact hours of training or coursework in
human sexuality as specified in Section 25 and any regulations
promulgated thereunder.
   (d) A minimum of 15 contact hours of training or coursework in
alcoholism and other chemical substance dependency as specified by
regulation.
   (e) Instruction in spousal or partner abuse assessment, detection,
and intervention.  This instruction may be taken either in
fulfillment of other requirements for licensure or in a separate
course.
   (f) On and after January 1, 2003, a minimum of a two semester or
three quarter unit survey course in psychological testing.  This
course may be taken either in fulfillment of other requirements for
licensure or in a separate course.
   (g) On and after January 1, 2003, a minimum of a two semester or
three quarter unit survey course in psychopharmacology.  This course
may be taken either in fulfillment of other requirements for
licensure or in a separate course.
   (h) With respect to human sexuality, alcoholism and other chemical
substance dependency, spousal or partner abuse assessment,
detection, and intervention, psychological testing, and
psychopharmacology, the board may accept training or coursework
acquired out of state.
  SEC. 17.  Section 4980.90 of the Business and Professions Code is
amended to read:
   4980.90.  (a) Experience gained outside of California shall be
accepted toward the licensure requirements if it is substantially
equivalent to that required by this chapter and if the applicant has
gained a minimum of 250 hours of supervised experience in direct
counseling within California while registered as an intern with the
board.
   (b) Education gained outside of California shall be accepted
toward the licensure requirements if it is substantially equivalent
to the education requirements of this chapter, and if the applicant
has completed all of the following:
   (1) A two semester or three quarter unit course in California law
and professional ethics for marriage, family, and child counselors
that shall include areas of study as specified in Section 4980.41.
   (2) A minimum of seven contact hours of training or coursework in
child abuse assessment and reporting as specified in Section 28 and
any regulations promulgated thereunder.
   (3) A minimum of 10 contact hours of training or coursework in
sexuality as specified in Section 25 and any regulations promulgated
thereunder.
   (4) A minimum of 15 contact hours of training or coursework in
alcoholism and other chemical substance dependency as specified by
regulation.
   (5) Instruction in spousal or partner abuse assessment, detection,
and intervention.  This instruction may be taken either in
fulfillment of other educational requirements for licensure or in a
separate course.
   (6) On and after January 1, 2003, a minimum of a two semester or
three quarter unit survey course in psychological testing.  This
course may be taken either in fulfillment of other requirements for
licensure or in a separate course.
   (7) On and after January 1, 2003, a minimum of a two semester or
three quarter unit survey course in psychopharmacology.  This course
may be taken either in fulfillment of other requirements for
licensure or in a separate course.
   (8) With respect to human sexuality, alcoholism and other chemical
substance dependency, spousal or partner abuse assessment,
detection, and intervention, psychological testing, and
psychopharmacology, the board may accept training or coursework
acquired out of state.
   (c) For purposes of this section, the board may, in its
discretion, accept education as substantially equivalent if the
applicant has been granted a degree in a single integrated program
primarily designed to train marriage, family, and child counselors
and if the applicant's education meets the requirements of Sections
4980.37 and 4980.40.  The degree title and number of units in the
degree program need not be identical to those required by subdivision
(a) of Section 4980.40.  If the applicant's degree does not contain
the number of units required by subdivision (a) of Section 4980.40,
the board may, in its discretion, accept the applicant's education as
substantially equivalent if the applicant's degree otherwise
complies with this section and the applicant completes the units
required by subdivision (a) of Section 4980.40.
  SEC. 18.  Section 4996.6 of the Business and Professions Code is
amended to read:
   4996.6.  (a) The renewal fee for licenses that expire on or after
January 1, 1996, shall be a maximum of one hundred fifty-five dollars
($155) and shall be collected on a biennial basis by the board in
accordance with Section 152.6.  The fees shall be deposited in the
State Treasury to the credit of the Behavioral Sciences Fund.
   (b) Licenses issued under this chapter shall expire no more than
24 months after the issue date.  The expiration date of the original
license shall be set by the board.
   (c) To renew an unexpired license, the licensee shall, on or
before the expiration date of the license, do the following:
   (1) Apply for a renewal on a form prescribed by the board.
   (2) Pay a two-year renewal fee prescribed by the board.
   (3) Certify compliance with the continuing education requirements
set forth in Section 4996.22.
   (4) Notify the board whether he or she has been convicted, as
defined in Section 490, of a misdemeanor or felony, or whether any
disciplinary action has been taken by any regulatory or licensing
board in this or any other state, subsequent to the licensee's last
renewal.
   (d) If the license is renewed after its expiration, the licensee
shall, as a condition precedent to renewal, also pay a delinquency
fee of seventy-five dollars ($75).
   (e) Any person who permits his or her license to become delinquent
may have it restored at any time within five years after its
expiration upon the payment of all fees that he or she would have
paid if the license had not become delinquent, plus the payment of
all delinquency fees.
   (f) A license that is not renewed within five years after its
expiration may not be renewed, restored, reinstated, or reissued
thereafter; however, the licensee may apply for and obtain a new
license if:
   (1) No fact, circumstance, or condition exists that, if the
license were issued, would justify its revocation or suspension.
   (2) He or she pays the fees that would be required if he or she
were applying for a license for the first time.
   (3) He or she takes and passes the current licensing examinations.

   (g) The fee for issuance of any replacement registration, license,
or certificate shall be twenty dollars ($20).
   (h) The fee for issuance of a certificate or letter of good
standing shall be twenty-five dollars ($25).
  SEC. 19.  Section 5111 of the Business and Professions Code is
amended to read:
   5111.  Cheating on, or subverting or attempting to subvert any
licensing examination includes, but is not limited to, engaging in,
soliciting, or procuring any of the following:
   (a) Any communication between one or more examinees and any
person, other than a proctor or examination official, while the
examination is in progress.
   (b) Any communication between one or more examinees and any other
person at any time concerning the content of the examination
including, but not limited to, any examination question or answer,
unless the examination has been publicly released by the examining
authority or jurisdiction.
   (c) The taking of all or a part of the examination by a person
other than the applicant.
   (d) Possession or use at any time during the examination or while
the examinee is on the examination premises of any device, material,
or document that is not expressly authorized for use by examinees
during the examination including, but not limited to, notes, crib
sheets, textbooks, and electronic devices.
   (e) Failure to follow any examination instruction or rule related
to examination security.
   (f) Providing false, fraudulent, or materially misleading
information concerning education, experience, or other qualifications
as part of, or in support of, any application for admission to any
professional or vocational examination.
  SEC. 20.  Section 5536 of the Business and Professions Code is
amended to read:
   5536.  (a) It is a misdemeanor, punishable by a fine of not less
than one hundred dollars ($100) nor more than five thousand dollars
($5,000), or by imprisonment in the county jail not exceeding one
year, or by both that fine and imprisonment, for any person who is
not licensed to practice architecture under this chapter to practice
architecture in this state, to use any term confusingly similar to
the word architect, to use the stamp of a licensed architect, as
provided in Section 5536.1, or to advertise or put out any sign,
card, or other device that might indicate to the public that he or
she is an architect, that he or she is qualified to engage in the
practice of architecture, or that he or she is an architectural
designer.
   (b) It is a misdemeanor, punishable as specified in subdivision
(a), for any person who is not licensed to practice architecture
under this chapter to affix a stamp or seal that bears the legend
"State of California" or words or symbols that represent or imply
that the person is so licensed by the state to plans, specifications,
or instruments of service.
   (c) It is a misdemeanor, punishable as specified in subdivision
(a), for any person to advertise or represent that he or she is a
"registered building designer" or is registered or otherwise licensed
by the state as a building designer.
  SEC. 21.  Section 6403 of the Business and Professions Code, as
amended by Section 5 of Chapter 386 of the Statutes of 2000, is
amended to read:
   6403.  (a) The application for registration of a natural person
shall contain all of the following statements about the applicant:
   (1) Name, age, address, and telephone number.
   (2) Whether he or she has been convicted of a felony, or of a
misdemeanor under Section 6126 or 6127.
   (3) Whether he or she has been held liable in a civil action by
final judgment or entry of a stipulated judgment, if the action
alleged fraud, the use of an untrue or misleading representation, or
the use of an unfair, unlawful, or deceptive business practice.
   (4) Whether he or she has ever been convicted of a misdemeanor
violation of this chapter.
   (5) Whether he or she has had a civil judgment entered against him
or her in an action arising out of the applicant's negligent,
reckless, or willful failure to properly perform his or her
obligation as a legal document assistant or unlawful detainer
assistant.
   (6) Whether he or she has had a registration revoked pursuant to
Section 6413.
   (7) Whether this is a primary or secondary registration.  If it is
a secondary registration, the county in which the primary
registration is filed.
   (b) The application for registration of a natural person shall be
accompanied by the display of personal identification, such as a
California driver's license, birth certificate, or other
identification acceptable to the county clerk to adequately determine
the identity of the applicant.
   (c) The application for registration of a partnership or
corporation shall contain all of the following statements about the
applicant:
   (1) The names, ages, addresses, and telephone numbers of the
general partners or officers.
   (2) Whether the general partners or officers have ever been
convicted of a felony, or a misdemeanor under Section 6126 or 6127.
   (3) Whether the general partners or officers have ever been held
liable in a civil action by final judgment or entry of a stipulated
judgment, if the action alleged fraud, the use of an untrue or
misleading representation, or the use of an unfair, unlawful, or
deceptive business practice.
   (4) Whether the general partners or officers have ever been
convicted of a misdemeanor violation of this chapter.
                                                              (5)
Whether the general partners or officers have had a civil judgment
entered against them in an action arising out of a negligent,
reckless, or willful failure to properly perform the obligations of a
legal document assistant or unlawful detainer assistant.
   (6) Whether the general partners or officers have ever had a
registration revoked pursuant to Section 6413.
   (7) Whether this is a primary or secondary registration.  If it is
a secondary registration, the county in which the primary
registration is filed.
   (d) The applications made under this section shall be made under
penalty of perjury.
   (e) This section shall remain in effect only until January 1,
2003, or the date the director suspends the requirements of this
chapter applicable to legal document assistants pursuant to Section
6416, whichever first occurs, and as of that date is repealed, unless
a later enacted statute, that is enacted before that date, deletes
or extends that date.
  SEC. 22.  Section 6403 of the Business and Professions Code, as
amended by Section 4 of Chapter 386 of the Statutes of 2000, is
amended to read:
   6403.  (a) The application for registration of a natural person
shall contain all of the following statements about the applicant:
   (1) Name, age, address, and telephone number.
   (2) Whether he or she has been convicted of a felony, or of a
misdemeanor under Section 6126 or 6127.
   (3) Whether he or she has been held liable in a civil action by
final judgment or consented to the entry of a stipulated judgment, if
the action alleged fraud, the use of untrue or misleading
representations, or the use of an unfair, unlawful, or deceptive
business practice.
   (4) Whether this is a primary or secondary registration.  If it is
a secondary registration, the county in which the primary
registration is filed.
   (b) The application for registration of a partnership or
corporation shall contain all of the following statements about the
applicant:
   (1) The names, ages, addresses, and telephone numbers of the
general partners or officers.
   (2) Whether the general partners or officers have ever been
convicted of a felony.
   (3) Whether the general partners or officers have ever been held
liable in a civil action by final judgment or have consented to the
entry of a stipulated judgment.  If the action alleged fraud, whether
it involved the use of untrue or misleading representations or the
use of an unfair, unlawful, or deceptive business practice.
   (4) Whether this is a primary or secondary registration.  If it is
a secondary registration, the county in which the primary
registration is filed.
   (c) This section shall become operative January 1, 2003, or the
date the director suspends the requirements of this chapter
applicable to legal document assistants pursuant to Section 6416,
whichever first occurs.
  SEC. 23.  Section 6716 of the Business and Professions Code is
amended to read:
   6716.  (a) The board may adopt rules and regulations consistent
with law and necessary to govern its action.  These rules and
regulations shall be adopted in accordance with the provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code).
   (b) The board may adopt rules and regulations of professional
conduct that are not inconsistent with state and federal law.  The
rules and regulations may include definitions of incompetence and
negligence.  Every person who holds a license or certificate issued
by the board pursuant to this chapter shall be governed by these
rules and regulations.
   (c) The board shall hold at least two regular meetings each year.
Special meetings shall be held at those times that the board's rules
provide.  A majority of the board constitutes a quorum.  Except as
otherwise provided by law, the vote required for any action of the
board is a majority of the members present, but not less than five.

  SEC. 24.  Section 6730.2 of the Business and Professions Code is
amended to read:
   6730.2.  It is the intent of the Legislature that the registration
requirements that are imposed upon private sector professional
engineers and engineering partnerships, firms, or corporations shall
be imposed upon the state and any city, county, or city and county
that shall adhere to those requirements.  Therefore, for the purposes
of Section 6730 and this chapter, at least one registered engineer
shall be designated the person in responsible charge of professional
engineering work for each branch of professional engineering
practiced in any department or agency of the state, city, county, or
city and county.
   Any department or agency of the state or any city, county, or city
and county which has an unregistered person in responsible charge of
engineering work on January 1, 1985, shall be exempt from this
requirement until that time as the person currently in responsible
charge is replaced.
  SEC. 25.  Section 6756 of the Business and Professions Code is
amended to read:
   6756.  (a) An applicant for certification as an
engineer-in-training shall, upon making a passing grade in that
division of the examination prescribed in Section 6755, relating to
fundamental engineering subjects, be issued a certificate as an
engineer-in-training.  A renewal or other fee, other than the
application fee, may not be charged for this certification.  The
certificate shall become invalid when the holder has qualified as a
professional engineer as provided in Section 6762.
   (b) An engineer-in-training certificate does not authorize the
holder thereof to practice or offer to practice civil, electrical, or
mechanical engineering work, in his or her own right, or to use the
titles specified in Sections 6732 and 6763.
   (c) A person may not use the title of engineer-in-training, or any
abbreviation of that title, unless he or she is the holder of a
valid engineer-in-training certificate.
  SEC. 26.  Section 7092 of the Business and Professions Code is
amended to read:
   7092.  (a) (1) The director shall appoint a Contractors' State
License Board Enforcement Program Monitor no later than January 31,
2001.  The director may retain a person for this position by a
personal services contract, the Legislature finding, pursuant to
Section 19130 of the Government Code, that this is a new state
function.
   (2) The director shall supervise the enforcement program monitor
and may terminate or dismiss him or her from this position.
   (b) The director shall advertise the availability of this
position.  The requirements for this position include experience in
conducting investigations and familiarity with state laws, rules, and
procedures pertaining to the board and familiarity with relevant
administrative procedures.
   (c) (1) The enforcement program monitor shall monitor and evaluate
the Contractors' State License Board discipline system and
procedures, making as his or her highest priority the reform and
reengineering of the board's enforcement program and operations, and
the improvement of the overall efficiency of the board's disciplinary
system.
   (2) This monitoring duty shall be on a continuing basis for a
period of no more than two years from the date of the enforcement
program monitor's appointment and shall include, but not be limited
to, improving the quality and consistency of complaint processing and
investigation and reducing the timeframes for each, reducing any
complaint backlog, assuring consistency in the application of
sanctions or discipline imposed on licensees, and shall include the
following areas:  the accurate and consistent implementation of the
laws and rules affecting discipline, staff concerns regarding
disciplinary matters or procedures, appropriate utilization of
licensed professionals to investigate complaints, and the board's
cooperation with other governmental entities charged with enforcing
related laws and regulations regarding contractors.
   (3) The enforcement program monitor shall exercise no authority
over the board's discipline operations or staff; however, the board
and its staff shall cooperate with him or her, and the board shall
provide data, information, and case files as requested by the
enforcement program monitor to perform all of his or her duties.
   (4) The director shall assist the enforcement program monitor in
the performance of his or her duties, and the enforcement program
monitor shall have the same investigative authority as the director.

   (d) The enforcement program monitor shall submit an initial
written report of his or her findings and conclusions to the board,
the department, and the Legislature no later than August 1, 2001, and
every six months thereafter, and be available to make oral reports
to each, if requested to do so.  The enforcement program monitor may
also provide additional information to either the department or the
Legislature at his or her discretion or at the request of either the
department or the Legislature.  The enforcement monitor shall make
his or her reports available to the public or the media.  The
enforcement program monitor shall make every effort to provide the
board with an opportunity to reply to any facts, findings, issues, or
conclusions in his or her reports with which the board may disagree.

   (e) The board shall reimburse the department for all of the costs
associated with the employment of an enforcement program monitor.
   (f) This section shall remain in effect only until January 31,
2003, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 31, 2003, deletes or extends
that date.
  SEC. 27.  Section 7583.11 of the Business and Professions Code is
amended to read:
   7583.11.  (a) Except as provided in subdivision (b), an employee
of a licensee may be assigned to work with a temporary registration
card that indicates completion of the course in the exercise of the
power to arrest until the bureau issues a registration card or denies
the application for registration.  However, a licensee shall not
assign an employee to work with a temporary registration card unless
the licensee submits the employee's application and registration fee
to the bureau on or before the same business day that the employee is
assigned to work as a security guard or security patrolperson
performing any of the functions set forth in subdivision (a) of
Section 7582.1.  If a licensee assigns an employee to work with a
temporary registration card on a Saturday, Sunday, or on a federal
holiday, the licensee may submit the employee's application and
registration fee to the bureau on the first business day immediately
following the Saturday, Sunday, or federal holiday.  A temporary
registration card shall in no event be valid for more than 120 days.
However, the director may extend the expiration date beyond the 120
days at any time when there is an abnormal delay in processing
applications for prospective security guards.  For purposes of this
section, the 120-day period shall commence on the date the applicant
signs the application.
   (b) An employee who has been convicted of a crime prior to
applying for a position as a security guard shall not be issued a
temporary registration card and shall not be assigned to work as a
security guard until the bureau issues a permanent registration card.
  This subdivision shall apply only if the applicant for registration
as a security guard has disclosed the conviction to the bureau on
his or her application form or if the fact of the conviction has come
to the attention of the bureau through official court or other
governmental documents.  In no event shall the director, the
department, the bureau, the chief, or the State of California be
liable for any civil damages in the event of the issuance of a
temporary registration if the applicant has falsified his or her
application to conceal a prior criminal conviction.
   (c) A temporary registration card issued pursuant to this section
shall include the name, address, and license number of the private
patrol operator employer or training facility that issued the
temporary registration card.
   (d) An employee shall, on the first day of employment, display to
the client his or her registration card or temporary registration
card, when it is feasible and practical to comply with this
disclosure requirement.  The employee shall thereafter display to the
client his or her registration card or temporary registration card
upon the request of the client.
   (e) "Submit," as used in subdivision (a), means any of the
following:
   (1) To ensure that the application and registration fee have been
received by the bureau on or before the business day that the
employee is assigned to work.
   (2) To ensure that the application and registration fee either
have been mailed to the bureau and officially postmarked with a date
on or before the employee is assigned to work or have been deposited
with a carrier performing overnight delivery services on or before
the business day that the employee is assigned to work.
   (3) To ensure, if the applicant is assigned to work on a Saturday,
Sunday, or on a federal holiday, that the application and
registration fee either have been mailed to the bureau and officially
postmarked with a date on the first business day immediately
following that Saturday, Sunday, or federal holiday or have been
deposited with a carrier performing overnight delivery services on
the first business day immediately following that Saturday, Sunday,
or federal holiday.
   (f) This section shall become inoperative on June 30, 2003, and,
as of January 1, 2004, is repealed, unless a later enacted statute
that is enacted before January 1, 2004, deletes or extends the dates
on which it becomes inoperative and is repealed.
  SEC. 28.  Section 8027 of the Business and Professions Code is
amended to read:
   8027.  (a) As used in this section, "school" means a court
reporter training program or an institution that provides a course of
instruction approved by the board, and is approved by the Council
for Private Postsecondary and Vocational Education, is a public
school in this state, or is accredited by the Western Association of
Schools and Colleges.
   (b) A court reporting school shall be primarily organized to train
students for the practice of shorthand reporting, as defined in
Sections 8016 and 8017.  Its educational program shall be on the
postsecondary or collegiate level, and shall be a residence program;
its educational program shall not be a correspondence program.  It
shall be legally organized and authorized to conduct its program
under all applicable laws of the state, and shall conform to and
offer all components of the minimum prescribed course of study
established by the board.  Its records shall be kept and shall be
maintained in a manner to render them safe from theft, fire, or other
loss.  The records shall indicate positive daily and clock-hour
attendance of each student, apprenticeship and graduation reports,
high school transcripts or the equivalent, or self-certification of
high school graduation or the equivalent, transcripts of other
education, and student progress to date.
   (c) Any school intending to offer a program in court reporting
shall notify the board within 30 days of the date on which it
provides notice to, or seeks approval from, the California Department
of Education, the Council for Private Postsecondary and Vocational
Education, the Chancellor's office of the California Community
Colleges, or the Western Association of Schools and Colleges,
whichever is applicable.  The board shall review the proposed
curriculum and provide the school tentative approval, or notice of
denial, within 60 days of receipt of the notice.  The school shall
apply for provisional recognition pursuant to subdivision (d) within
no more than one year from the date it begins offering court
reporting classes.
   (d) The board may grant provisional recognition to a new court
reporting school upon satisfactory evidence that it has met all of
the provisions of subdivision (b) and this subdivision.  Recognition
may be granted by the board to a provisionally recognized school
after it has been in continuous operation for a period of no less
than three consecutive years from the date provisional recognition
was granted, during which period the school shall provide
satisfactory evidence that at least one person has successfully
completed the entire course of study established by the board and
complied with the provisions of Section 8020, and has been issued a
certificate to practice shorthand reporting as defined in Sections
8016 and 8017.  The board may, for good cause shown, extend the
three-year provisional recognition period for not more than one year.
  Failure to meet the provisions and terms of this section shall
require the board to deny recognition.  Once granted, recognition may
be withdrawn by the board for failure to comply with the
requirements of this section.
   (e) Application for recognition of a court reporting school shall
be made upon a form prescribed by the board and shall be accompanied
by all evidence, statements, or documents requested.  Each branch,
extension center, or off-campus facility requires separate
application.
   (f) All recognized and provisionally recognized court reporting
schools shall notify the board of any change in school name, address,
telephone number, responsible court reporting program manager, owner
of private schools, and the effective date thereof, within 30 days
of the change.  All of these notifications shall be made in writing.

   (g) A school shall notify the board in writing immediately of the
discontinuance or pending discontinuance of its court reporting
program or any of the program's components.  Within two years of the
date this notice is sent to the board, the school shall discontinue
its court reporting program in its entirety.  The board may, for good
cause shown, grant not more than two, one-year extensions of this
period to a school.  If a student is to be enrolled after this notice
is sent to the board, a school shall disclose to the student the
fact of the discontinuance or pending discontinuance of its court
reporting program or any of its program components.
   (h) The board shall maintain a roster of currently recognized and
provisionally recognized court reporting schools including, but not
limited to, the name, address, telephone number, and the name of the
responsible court reporting program manager of each school.
   (i) The board shall maintain statistics that display the number
and passing percentage of all first-time examinees including, but not
limited to, those qualified by each recognized or provisionally
recognized school and those first-time examinees qualified by other
methods as defined in Section 8020.
   (j) Inspections and investigations shall be conducted by the board
as necessary to carry out this section.
   (k) All recognized and provisionally recognized schools shall
print in their school or course catalog the name, address, and
telephone number of the board.  At a minimum, the information shall
be in 8-point bold type and include the following statement:

   "IN ORDER FOR A PERSON TO QUALIFY FROM A SCHOOL TO TAKE THE STATE
LICENSING EXAMINATION, THE PERSON SHALL COMPLETE A PROGRAM AT A
RECOGNIZED SCHOOL.  FOR INFORMATION CONCERNING THE MINIMUM
REQUIREMENTS THAT A COURT REPORTING PROGRAM MUST MEET IN ORDER TO BE
RECOGNIZED, CONTACT:  THE COURT REPORTERS BOARD OF CALIFORNIA;
(ADDRESS); (TELEPHONE NUMBER)."

   (l) Each court reporting school shall file with the board, not
later than June 30 of each year, a current school catalog that shows
all course offerings and staff, and for private schools, the owner,
except that where there have been no changes to the catalog within
the previous year, no catalog need be sent.  In addition, each school
shall also file with the board a statement certifying that the
school is in compliance with all statutes and the rules and
regulations of the board, signed by the responsible court reporting
program manager.
   (m) A school offering court reporting may not make any written or
verbal claims of employment opportunities or potential earnings
unless those claims are based on verified data and reflect current
employment conditions.
   (n) Any person teaching an academic course, that is a course other
than machine shorthand or typing, in a court reporting program shall
meet one of the following criteria:
   (1) Possess a minimum of an Associate of Arts degree and, in
addition, either a minimum of two years of experience teaching the
subject being taught or at least two years' work experience in a job
substantially related to the subject being taught.
   (2) Possess a current license as a certified shorthand reporter
and, in addition, either a minimum of two years of experience
teaching the subject being taught or at least two years' work
experience in a job substantially related to the subject being
taught.
   (3) Possess a minimum of four years' experience teaching the
subject being taught or a minimum of four years' work experience in a
job substantially related to the subject being taught.
   (4) Possess a minimum of a Bachelor of Arts or Bachelor of Science
degree in the subject being taught.
   (o) The pass rate of first-time examination takers for each school
offering court reporting shall meet or exceed the average pass rate
of all first-time test takers for a majority of examinations given
for the preceding three years.  Failure to do so shall require the
board to conduct a review of the program.  In addition, the board may
place the school on probation and may withdraw recognition if the
school continues to place below the above described standard on the
two examinations  that follow the three-year period.
  SEC. 29.  Section 8773.4 of the Business and Professions Code is
amended to read:
   8773.4.  (a) A corner record may not be filed unless the same is
signed by a licensed land surveyor or registered civil engineer and
stamped with his or her seal, or in the case of an agency of the
United States government or the State of California, the certificate
may be signed by the chief of the survey party making the survey,
setting forth his or her official title.
   (b) A corner record need not be filed when:
   (1) A corner record is on file and the corner is found as
described in the existing corner record.
   (2) All conditions of Section 8773 are complied with by proper
notations on a record of survey map filed in compliance with the
Professional Land Surveyors' Act or a parcel or subdivision map, in
compliance with the Subdivision Map Act.
   (3) When the survey is a survey of a mobilehome park interior lot
as defined in Section 18210 of the Health and Safety Code, provided
that no subdivision map, official map, or record of survey has been
previously filed for the interior lot or no conversion to residential
ownership has occurred pursuant to Section 66428.1 of the Government
Code.
   This section shall not apply to maps filed prior to January 1,
1974.
  SEC. 30.  Section 10167.2 of the Business and Professions Code is
amended to read:
   10167.2.  (a) It is unlawful for any person to engage in the
business of a prepaid rental listing service unless licensed in that
capacity or unless licensed as a real estate broker.
   (b) (1) The requirements of this article apply only to the
provision of listings of residential real properties for tenancy by
prepaid rental listing services.  Except if expressly provided
otherwise in this article, the requirements of this article do not
apply to any other goods or services sold by a prepaid rental listing
service as long as the purchase of those goods or services is not
required to obtain those listings, and as long as the purchase of
those goods or services is not included in the same contract as the
contract to provide those listings, and as long as the contract to
provide those listings clearly specifies that the purchase of any
other goods and services is optional, and as long as the price
charged for any other goods and services is fair and reasonable.
   (2) In an action alleging that the price charged for any other
goods and services is not fair and reasonable, the burden shall be on
the commissioner to demonstrate that the price charged unreasonably
exceeds the fee customarily charged for the same or comparable goods
or services in the community in which the prepaid rental listing
service operates.  The fact that the price charged for goods or
services exceeds the cost incurred by the prepaid rental listing
service shall not render the price charged for the goods or services
to be unfair or unreasonable, so long as the price charged does not
unreasonably exceed the fee customarily charged for the same or
comparable goods or services in the community in which the prepaid
rental listing service operates.
  SEC. 31.  Section 21702 of the Business and Professions Code is
amended to read:
   21702.  The owner of a self-service storage facility and his or
her heirs, executors, administrators, successors, and assigns have a
lien upon all personal property located at a self-service storage
facility for rent, labor, late payment fees, or other charges,
present or future, incurred pursuant to the rental agreement and for
expenses necessary for the preservation, sale, or disposition of
personal property subject to the provisions of this chapter.  The
lien may be enforced consistent with the provisions in this chapter.

  SEC. 32.  Section 1748.10 of the Civil Code is amended to read:
   1748.10.  This act shall be known and may be cited as the "Areias
Credit Card Full Disclosure Act of 1986."
  SEC. 33.  Section 1748.11 of the Civil Code is amended to read:
   1748.11.  (a) Any application form or preapproved written
solicitation for an open-end credit card account to be used for
personal, family, or household purposes that is mailed on or after
October 1, 1987, to a consumer residing in this state by or on behalf
of a creditor, whether or not the creditor is located in this state,
other than an application form or solicitation included in a
magazine, newspaper, or other publication distributed by someone
other than the creditor, shall contain or be accompanied by either of
the following disclosures:
   (1) A disclosure of each of the following, if applicable:
   (A) Any periodic rate or rates that may be applied to the account,
expressed as an annual percentage rate or rates.  If the account is
subject to a variable rate, the creditor may instead either disclose
the rate as of a specific date and indicate that the rate may vary,
or identify the index and any amount or
                 percentage added to, or subtracted from, that index
and used to determine the rate.  For purposes of this section, that
amount or percentage shall be referred to as the "spread."
   (B) Any membership or participation fee that may be imposed for
availability of a credit card account, expressed as an annualized
amount.
   (C) Any per transaction fee that may be imposed on purchases,
expressed as an amount or as a percentage of the transaction, as
applicable.
   (D) If the creditor provides a period during which the consumer
may repay the full balance reflected on a billing statement that is
attributable to purchases of goods or services from the creditor or
from merchants participating in the credit card plan, without the
imposition of additional finance charges, the creditor shall either
disclose the number of days of that period, calculated from the
closing date of the prior billing cycle to the date designated in the
billing statement sent to the consumer as the date by which that
payment must be received to avoid additional finance charges, or
describe the manner in which the period is calculated.  For purposes
of this section, the period shall be referred to as the "free period"
or "free-ride period."  If the creditor does not provide this period
for purchases, the disclosure shall so indicate.
   (2) A disclosure that satisfies the initial disclosure statement
requirements of Regulation Z.
   (b) A creditor need not present the disclosures required by
paragraph (1) of subdivision (a) in chart form or use any specific
terminology, except as expressly provided in this section.  The
following chart shall not be construed in any way as a standard by
which to determine whether a creditor who elects not to use such a
chart has provided the required disclosures in a manner that
satisfies paragraph (1) of subdivision (a).  However, disclosures
shall be conclusively presumed to satisfy the requirements of
paragraph (1) of subdivision (a) if a chart with captions
substantially as follows is completed with the applicable terms
offered by the creditor, or if the creditor presents the applicable
terms in tabular, list, or narrative format using terminology
substantially similar to the captions included in the following
chart:


           THE FOLLOWING INFORMATION IS PROVIDED PURSUANT
          TO THE AREIAS CREDIT CARD FULL DISCLOSURE ACT OF
                                1986:
           INTEREST RATES, FEES, AND FREE-RIDE PERIOD FOR
              PURCHASES UNDER THIS CREDIT CARD ACCOUNT
       ------------------------------------------------------
       '          '          ' ANNUAL-  '        '          '
       '          '          '  IZED    '        '          '
       '          ' VARIABLE ' MEMBER-  '        '          '
       '          '   RATE   '  SHIP    '        '          '
       ' ANNUAL   '  INDEX   ' OR PAR-  '        '  FREE    '
       '  PER-    '   AND    '  TICI-   ' TRANS- '  RIDE-   '
       ' CENTAGE  '  SPREAD  ' PATION   ' ACTION ' PERIOD   '
       ' RATE (1) '   (2)    '  FEE     '  FEE   '  (3)     '
       '__________'__________'__________'________'__________'
       '          '          '          '        '          '
       '          '          '          '        '          '
       '          '          '          '        '          '
       '          '          '          '        '          '
       '          '          '          '        '          '
       '__________'__________'__________'________'__________'

   (1) For fixed interest rates.  If variable rate, creditor may
elect to disclose a rate as of a specified date and indicate that the
rate may vary.
   (2) For variable interest rates.  If fixed rate, creditor may
eliminate the column, leave the column blank, or indicate "No" or
"None" or "Does not apply."
   (3) For example, "30 days" or "Yes, if full payment is received by
next billing date" or "Yes, if full new balance is paid by due date."

   (c) For purposes of this section, "Regulation Z" has the meaning
attributed to it under Section 1802.18, and all of the terms used in
this section have the same meaning as attributed to them in federal
Regulation Z (12 C.F.R. 226.1 et seq.).  For the purposes of this
section, "open-end credit card account" does not include an account
accessed by a device described in paragraph (2) of subdivision (a) of
Section 1747.02.
   (d) Nothing in this section shall be deemed or construed to
prohibit a creditor from disclosing additional terms, conditions, or
information, whether or not relating to the disclosures required
under this section, in conjunction with the disclosures required by
this section.
   (e) If a creditor is required under federal law to make any
disclosure of the terms applicable to a credit card account in
connection with application forms or solicitations, the creditor
shall be deemed to have complied with the requirements of paragraph
(1) of subdivision (a) with respect to those application forms or
solicitations if the creditor complies with the federal disclosure
requirement.  For example, in lieu of complying with the requirements
of paragraph (1) of subdivision (a), a creditor has the option of
disclosing the specific terms required to be disclosed in an
advertisement under Regulation Z, if the application forms or
solicitations constitute advertisements in which specific terms must
be disclosed under Regulation Z.
   (f) If for any reason the requirements of this section do not
apply equally to creditors located in this state and creditors not
located in this state, then the requirements applicable to creditors
located in this state shall automatically be reduced to the extent
necessary to establish equal requirements for both categories of
creditors, until it is otherwise determined by a court of law in a
proceeding to which the creditor located in this state is a party.
   (g) All application forms for an open-end credit card account
distributed in this state on or after October 1, 1987, other than by
mail, shall contain a statement in substantially the following form:

   "If you wish to receive disclosure of the terms of this credit
card, pursuant to the Areias Credit Card Full Disclosure Act of 1986,
check here and return to the address on this application."
   A box shall be printed in or next to this statement for placement
of such a checkmark.
   However, this subdivision does not apply if the application
contains the disclosures provided for in this title.
   (h) This title does not apply to any application form or written
advertisement or an open-end credit card account where the credit to
be extended will be secured by a lien on real or personal property or
both real and personal property.
   (i) This title does not apply to any person who is subject to
Article 10.5 (commencing with Section 1810.20) of Chapter 1 of Title
2.
  SEC. 34.  Section 1810.21 of the Civil Code is amended to read:
   1810.21.  (a) Any application form or preapproved written
solicitation for a credit card issued in connection with a retail
installment account that is mailed on or after October 1, 1987, to a
retail buyer residing in this state by or on behalf of a retail
seller, whether or not the retail seller is located in this state,
other than an application form or solicitation included in a
magazine, newspaper, or other publication distributed by someone
other than the retail seller, shall contain or be accompanied by
either of the following disclosures:
   (1) A disclosure of each of the following, if applicable:
   (A) Any periodic rate or rates that will be used to determine the
finance charge imposed on the balance due under the terms of a retail
installment account, expressed as an annual percentage rate or
rates.
   (B) Any membership or participation fee that will be imposed for
availability of a retail installment account in connection with which
a credit card is issued expressed as an annualized amount.
   (C) If the retail seller provides a period during which the retail
buyer may repay the full balance reflected on a billing statement
that is attributable to purchases of goods or services from the
retail seller without the imposition of additional finance charges,
the retail seller shall either disclose the minimum number of days of
that period, calculated from the closing date of the prior billing
cycle to the date designated in the billing statement sent to the
retail buyer as the date by which that payment must be received to
avoid additional finance charges, or describe the manner in which the
period is calculated.  For purposes of this section, the period
shall be referred to as the "free period" or "free-ride period."  If
the retail seller does not provide this period for purchases, the
disclosure shall so indicate.
   (2) A disclosure that satisfies the initial disclosure statement
requirements of Regulation Z (12 C.F.R. 226.6).
   (b) In the event that an unsolicited application form is mailed or
otherwise delivered to retail buyers in more than one state, the
requirements of subdivision (a) shall be satisfied if on the
application form or the soliciting material there is a notice that
credit terms may vary from state to state and that provides either
the disclosures required by subdivision (a) or an address or phone
number for the customer to use to obtain the disclosure.  The notice
shall be in boldface type no smaller than the largest type used in
the narrative portion, excluding headlines, of the material
soliciting the application.  Any person responding to the notice
shall be given the disclosures required by subdivision (a).
   (c) A retail seller need not present the disclosures required by
paragraph (1) of subdivision (a) in chart form or use any specific
terminology, except as expressly provided in this section.  The
following chart shall not be construed in any way as a standard by
which to determine whether a retail seller who elects not to use the
chart has provided the required disclosures in a manner which
satisfies paragraph (1) of subdivision (a).  However, disclosures
shall be conclusively presumed to satisfy the requirements of
paragraph (1) of subdivision (a) if a chart with captions
substantially as follows is completed with the applicable terms
offered by the retail seller, or if the retail seller presents the
applicable terms in tabular, list, or narrative format using
terminology substantially similar to the captions included in the
following chart:


         THE FOLLOWING INFORMATION IS PROVIDED PURSUANT
         TO THE AREIAS RETAIL INSTALLMENT ACCOUNT FULL
                   DISCLOSURE ACT OF 1986:
            CREDIT CARD TERMS VARY AMONG RETAIL
         SELLERS--SELECTED TERMS FOR PURCHASES UNDER THIS
          RETAIL INSTALLMENT ACCOUNT ARE SET OUT BELOW
      ____________________________________________________
      '               '                '                  '
      '    PERIODIC   '                '                  '
      '     RATES     '    ANNUAL      '    FREE-RIDE     '
      '   (as APRs)   '     FEES       '     PERIOD       '
      '_______________'________________'__________________'
      '               '                '                  '
      '               '                '                  '
      '               '                '                  '
      '               '                '                  '
      '               '                '                  '
      '_______________'________________'__________________'

   (d) For purposes of this section, "Regulation Z" has the meaning
attributed to it under Section 1802.18, and all of the terms used in
this section have the same meaning as attributed to them in federal
Regulation Z (12 C.F.R. 226.1 et seq.).
   (e) Nothing in this section shall be deemed or construed to
prohibit a retail seller from disclosing additional terms,
conditions, or information, whether or not relating to the
disclosures required under this section, in conjunction with the
disclosures required by this section.  Notwithstanding subdivision
(g) of Section 1748.11, a retail seller that complies with the
requirements of Section 1748.11 shall be deemed to have complied with
the requirements of this section.
   (f) If a retail seller is required under federal law to make any
disclosure of the terms applicable to a retail installment account in
connection with application forms or solicitations, the retail
seller shall be deemed to have complied with the requirements of
paragraph (1) of subdivision (a) with respect to those application
forms or solicitations if the retail seller complies with the federal
disclosure requirement.
   (g) If the disclosure required by this section does not otherwise
appear on an application form or an accompanying retail installment
agreement distributed in this state on or after October 1, 1987,
other than by mail, the application form shall include a statement in
substantially the following form:
   "If you wish to receive disclosure of the terms of this retail
installment account, pursuant to the Areias Retail Installment
Account Full Disclosure Act of 1986, check here and return to the
address on this form."
   A box shall be printed in or next to this statement for placing
such a checkmark.
   (h) This article does not apply to (1) any application form or
preapproved written solicitation for a retail installment account
credit card where the credit to be extended will be secured by a lien
on real or personal property, or both real and personal property,
(2) any application form or written solicitation that invites a
person or persons to apply for a retail installment account credit
card and which is included as part of a catalog which is sent to one
or more persons by a creditor in order to facilitate a credit sale of
goods offered in the catalog, (3) any advertisement which does not
invite, directly or indirectly, an application for a retail
installment account credit card, and (4) any application form or
written advertisement included in a magazine, newspaper, or other
publication distributed in more than one state by someone other than
the creditor.
  SEC. 34.5.  Section 1834.8 of the Civil Code, as added by Section 1
of Chapter 476 of the Statutes of 2000, is amended and renumbered to
read:
   1834.9.  (a) Manufacturers and contract testing facilities shall
not use traditional animal test methods within this state for which
an appropriate alternative test method has been scientifically
validated and recommended by the Inter-Agency Coordinating Committee
for the Validation of Alternative Methods (ICCVAM) and adopted by the
relevant federal agency or agencies or program within an agency
responsible for regulating the specific product or activity for which
the test is being conducted.
   (b) Nothing in this section shall prohibit the use of any
alternative nonanimal test method for the testing of any product,
product formulation, chemical, or ingredient that is not recommended
by ICCVAM.
   (c) Nothing in this section shall prohibit the use of animal tests
to comply with requirements of state agencies.  Nothing in this
section shall prohibit the use of animal tests to comply with
requirements of federal agencies when the federal agency has approved
an alternative nonanimal test pursuant to subdivision (a) and the
federal agency staff concludes that the alternative nonanimal test
does not assure the health or safety of consumers.
   (d) Notwithstanding any other provision of law, the exclusive
remedy for enforcing this section shall be a civil action for
injunctive relief brought by the Attorney General, the district
attorney of the county in which the violation is alleged to have
occurred, or a city attorney of a city or a city and county having a
population in excess of 750,000 and in which the violation is alleged
to have occurred.  If the court determines that the Attorney General
or district attorney is the prevailing party in the enforcement
action, the official may also recover costs, attorney fees, and a
civil penalty not to exceed five thousand dollars ($5,000) in that
action.
   (e) This section shall not apply to any animal test performed for
the purpose of medical research.
   (f) For the purposes of this section, these terms have the
following meanings:
   (1) "Animal" means vertebrate nonhuman animal.
   (2) "Manufacturer" means any partnership, corporation,
association, or other legal relationship that produces chemicals,
ingredients, product formulations, or products in this state.
   (3) "Contract testing facility" means any partnership,
corporation, association, or other legal relationship that tests
chemicals, ingredients, product formulations, or products in this
state.
   (4) "ICCVAM" means the Inter-Agency Coordinating Committee for the
Validation of Alternative Methods, a federal committee comprised of
representatives from 14 federal regulatory or research agencies,
including the Food and Drug Administration, Environmental Protection
Agency, and Consumer Products Safety Commission, that reviews the
validity of alternative test methods.  The committee is the federal
mechanism for recommending appropriate, valid test methods to
relevant federal agencies.
   (5) "Medical research" means research related to the causes,
diagnosis, treatment, control, or prevention of physical or mental
diseases and impairments of humans and animals or related to the
development of biomedical products, devices, or drugs as defined in
Section 321(g)(1) of Title 21 of the United States Code.  Medical
research does not include the testing of an ingredient that was
formerly used in a drug, tested for the drug use with traditional
animal methods to characterize the ingredient and to substantiate its
safety for human use, and is now proposed for use in a product other
than a biomedical product, medical device, or drug.
   (6) "Traditional animal test method" means a process or procedure
using animals to obtain information on the characteristics of a
chemical or agent.  Toxicological test methods generate information
regarding the ability of a chemical or agent to produce a specific
biological effect under specified conditions.
   (7) "Validated alternative test method" means a test method that
does not use animals, or in some cases reduces or refines the current
use of animals, for which the reliability and relevance for a
specific purpose has been established in validation studies as
specified in the ICCVAM report provided to the relevant federal
agencies.
   (8) "Person" means an individual with managerial control, or a
partnership, corporation, association, or other legal relationship.
   (9) "Adopted by a federal agency" means a final action taken by an
agency, published in the Federal Register, for public notice.
  SEC. 35.  Section 2954.4 of the Civil Code is amended to read:
   2954.4.  (a) A charge that may be imposed for late payment of an
installment due on a loan secured by a mortgage or a deed of trust on
real property containing only a single-family, owner-occupied
dwelling, shall not exceed either (1) the equivalent of 6 percent of
the installment due that is applicable to payment of principal and
interest on the loan, or (2) five dollars ($5), whichever is greater.
  A charge may not be imposed more than once for the late payment of
the same installment.  However, the imposition of a late charge on
any late payment does not eliminate or supersede late charges imposed
on prior late payments.  A payment is not a "late payment" for the
purposes of this section until at least 10 days following the due
date of the installment.
   (b) A late charge may not be imposed on any installment which is
paid or tendered in full on or before its due date, or within 10 days
thereafter, even though an earlier installment or installments, or
any late charge thereon, may not have been paid in full when due.
For the purposes of determining whether late charges may be imposed,
any payment tendered by the borrower shall be applied by the lender
to the most recent installment due.
   (c) A late payment charge described in subdivision (a) is valid if
it satisfies the requirements of this section and Section 2954.5.
   (d) Nothing in this section shall be construed to alter in any way
the duty of the borrower to pay any installment then due or to alter
the rights of the lender to enforce the payment of the installments.

   (e) This section is not applicable to loans made by a credit union
subject to Division 5 (commencing with Section 14000) of the
Financial Code, by an industrial loan company subject to Division 7
(commencing with Section 18000) of the Financial Code, or by a
finance lender subject to Division 9 (commencing with Section 22000)
of the Financial Code, and is not applicable to loans made or
negotiated by a real estate broker subject to Article 7 (commencing
with Section 10240) of Chapter 3 of Part 1 of Division 4 of the
Business and Professions Code.
   (f) As used in this section, "single-family, owner-occupied
dwelling" means a dwelling that will be owned and occupied by a
signatory to the mortgage or deed of trust secured by the dwelling
within 90 days of the execution of the mortgage or deed of trust.
   (g) This section applies to loans executed on and after January 1,
1976.
  SEC. 36.  Section 2954.5 of the Civil Code is amended to read:
   2954.5.  (a) Before the first default, delinquency, or late
payment charge may be assessed by any lender on a delinquent payment
of a loan, other than a loan made pursuant to Division 9 (commencing
with Section 22000) of the Financial Code, secured by real property,
and before the borrower becomes obligated to pay this charge, the
borrower shall either (1) be notified in writing and given at least
10 days from mailing of  the notice in which to cure the delinquency,
or (2) be informed, by a billing or notice sent for each payment due
on the loan, of the date after which this charge will be assessed.
   The notice provided in either paragraph (1) or (2) shall contain
the amount of the charge or the method by which it is calculated.
   (b) If a subsequent payment becomes delinquent the borrower shall
be notified in writing, before the late charge is to be imposed, that
the charge will be imposed if payment is not received, or the
borrower shall be notified at least semiannually of the total amount
of late charges imposed during the period covered by the notice.
   (c) Notice provided by this section shall be sent to the address
specified by the borrower, or, if no address is specified, to the
borrower's address as shown in the lender's records.
   (d) In case of multiple borrowers obligated on the same loan, a
notice mailed to one shall be deemed to comply with this section.
   (e) The failure of the lender to comply with the requirements of
this section does not excuse or defer the borrower's performance of
any obligation incurred in the loan transaction, other than his or
her obligation to pay a late payment charge, nor does it impair or
defer the right of the lender to enforce any other obligation
including the costs and expenses incurred in any enforcement
authorized by law.
   (f) The provisions of this section as added by Chapter 1430 of the
Statutes of 1970 shall only affect loans made on and after January
1, 1971.
   The amendments to this section made at the 1975-76 Regular Session
of the Legislature shall only apply to loans executed on and after
January 1, 1976.
  SEC. 37.  Section 3097 of the Civil Code is amended to read:
   3097.  "Preliminary 20-day notice (private work)" means a written
notice from a claimant that is given prior to the recording of a
mechanic's lien, prior to the filing of a stop notice, and prior to
asserting a claim against a payment bond, and is required to be given
under the following circumstances:
   (a) Except one under direct contract with the owner or one
performing actual labor for wages as described in subdivision (a) of
Section 3089, or a person or entity to whom a portion of a laborer's
compensation is paid as described in subdivision (b) of Section 3089,
every person who furnishes labor, service, equipment, or material
for which a lien or payment bond otherwise can be claimed under this
title, or for which a notice to withhold can otherwise be given under
this title, shall, as a necessary prerequisite to the validity of
any claim of lien, payment bond, and of a notice to withhold, cause
to be given to the owner or reputed owner, to the original
contractor, or reputed contractor, and to the construction lender, if
any, or to the reputed construction lender, if any, a written
preliminary notice as prescribed by this section.
   (b) Except the contractor, or one performing actual labor for
wages as described in subdivision (a) of Section 3089, or a person or
entity to whom a portion of a laborer's compensation is paid as
described in subdivision (b) of Section 3089, all persons who have a
direct contract with the owner and who furnish labor, service,
equipment, or material for which a lien or payment bond otherwise can
be claimed under this title, or for which a notice to withhold can
otherwise be given under this title, shall, as a necessary
prerequisite to the validity of any claim of lien, claim on a payment
bond, and of a notice to withhold, cause to be given to the
construction lender, if any, or to the reputed construction lender,
if any, a written preliminary notice as prescribed by this section.
   (c) The preliminary notice referred to in subdivisions (a) and (b)
shall contain the following information:
   (1) A general description of the labor, service, equipment, or
materials furnished, or to be furnished, and an estimate of the total
price thereof.
   (2) The name and address of the person furnishing that labor,
service, equipment, or materials.
   (3) The name of the person who contracted for purchase of that
labor, service, equipment, or materials.
   (4) A description of the jobsite sufficient for identification.
   (5) The following statement in boldface type:
      NOTICE TO PROPERTY OWNER

   If bills are not paid in full for the labor, services, equipment,
or materials furnished or to be furnished, a mechanic's lien leading
to the loss, through court foreclosure proceedings, of all or part of
your property being so improved may be placed against the property
even though you have paid your contractor in full.  You may wish to
protect yourself against this consequence by (1) requiring your
contractor to furnish a signed release by the person or firm giving
you this notice before making payment to your contractor, or (2) any
other method or device that is appropriate under the circumstances.

   (6) If the notice is given by a subcontractor who has failed to
pay all compensation due to his or her laborers on the job, the
notice shall also contain the identity and address of any laborer and
any express trust fund to whom employer payments are due.
   If an invoice for materials or certified payroll contains the
information required by this section, a copy of the invoice,
transmitted in the manner prescribed by this section shall be
sufficient notice.
   A certificated architect, registered engineer, or licensed land
surveyor who has furnished services for the design of the work of
improvement and who gives a preliminary notice as provided in this
section not later than 20 days after the work of improvement has
commenced shall be deemed to have complied with subdivisions (a) and
(b) with respect to architectural, engineering, or surveying services
furnished, or to be furnished.
   (d) The preliminary notice referred to in subdivisions (a) and (b)
shall be given not later than 20 days after the claimant has first
furnished labor, service, equipment, or materials to the jobsite.  If
labor, service, equipment, or materials have been furnished to a
jobsite by a claimant who did not give a preliminary notice, that
claimant shall not be precluded from giving a preliminary notice at
any time thereafter.  The claimant shall, however, be entitled to
record a lien, file a stop notice, and assert a claim against a
payment bond only for labor, service, equipment, or material
furnished within 20 days prior to the service of the preliminary
notice, and at any time thereafter.
   (e) Any agreement made or entered into by an owner, whereby the
owner agrees to waive the rights or privileges conferred upon the
owner by this section shall be void and of no effect.
   (f) The notice required under this section may be served as
follows:
   (1) If the person to be notified resides in this state, by
delivering the notice personally, or by leaving it at his or her
address of residence or place of business with some person in charge,
or by first-class registered or certified mail, postage prepaid,
addressed to the person to whom notice is to be given at his or her
residence or place of business address or at the address shown by the
building permit on file with the authority issuing a building permit
for the work, or at an address recorded pursuant to subdivision (j).

   (2) If the person to be notified does not reside in this state, by
any method enumerated in paragraph (1) of this subdivision.  If the
person cannot be served by any of these methods, then notice may be
given by first-class certified or registered mail, addressed to the
construction lender or to the original contractor.
   (3) When service is made by first-class certified or registered
mail, service is complete at the time of the deposit of that
registered or certified mail.
   (g) A person required by this section to give notice to the owner,
to an original contractor, and to a person to whom a notice to
withhold may be given, need give only one notice to the owner, to the
original contractor, and to the person to whom a notice to withhold
may be given with respect to all materials, services, labor, or
equipment he or she furnishes for a work of improvement, that means
the entire structure or scheme of improvements as a whole, unless the
same is furnished under contracts with more than one subcontractor,
in which event, the notice requirements shall be met with respect to
materials, services, labor, or equipment furnished to each
contractor.
   If a notice contains a general description required by subdivision
(a) or (b) of the materials, services, labor, or equipment furnished
to the date of notice, it is not defective because, after that date,
the person giving notice furnishes materials, services, labor, or
equipment not within the scope of this general description.
   (h) If the contract price to be paid to any subcontractor on a
particular work of improvement exceeds four hundred dollars ($400),
the failure of that contractor, licensed under Chapter 9 (commencing
with Section 7000) of Division 3 of the Business and Professions
Code, to give the notice provided for in this section, constitutes
grounds for disciplinary action by the Registrar of Contractors.
   If the notice is required to contain the information set forth in
paragraph (6) of subdivision (c), a failure to give the notice,
including that information, that results in the filing of a lien,
claim on a payment bond, or the delivery of a stop notice by the
express trust fund to which the obligation is owing constitutes
grounds for disciplinary action by the Registrar of Contractors
against the subcontractor if the amount due the trust fund is not
paid.
   (i) Every city, county, city and county, or other governmental
authority issuing building permits shall, in its application form for
a building permit, provide space and a designation for the applicant
to enter the name, branch, designation, if any, and address of the
construction lender and shall keep the information on file open for
public inspection during the regular business hours of the authority.

   If there is no known construction lender, that fact shall be noted
in the designated space.  Any failure to indicate the name and
address of the construction lender on the application, however, shall
not relieve any person from the obligation to give to the
construction lender the notice required by this section.
   (j) A mortgage, deed of trust, or other instrument securing a
loan, any of the proceeds of which may be used for the purpose of
constructing improvements on real property, shall bear the
designation "Construction Trust Deed" prominently on its face and
shall state all of the following:  (1) the name and address of the
lender, and the name and address of the owner of the real property
described in the instrument, and (2) a legal description of the real
property that secures the loan and, if known, the street address of
the property.  The failure to be so designated or to state any of the
information required by this subdivision shall not affect the
validity of the mortgage, deed of trust, or other instrument.
   Failure to provide this information on this instrument when
recorded shall not relieve persons required to give preliminary
notice under this section from that duty.
   The county recorder of the county in which the instrument is
recorded shall indicate in the general index of the official records
of the county that the instrument secures a construction loan.
   (k) Every contractor and subcontractor employing laborers as
described in subdivision (a) of Section 3089 who has failed to pay
those laborers their full compensation when it became due, including
any employer payments described in Section 1773.1 of the Labor Code
and regulations adopted thereunder shall, without regard to whether
the work was performed on a public or private work, cause to be given
to those laborers, their bargaining representatives, if any, and to
the construction lender, if any, or to the reputed construction
lender, if any, not later than the date the compensation became
delinquent, a written notice containing all of the following:
   (1) The name of the owner and the contractor.
   (2) A description of the jobsite sufficient for identification.
   (3) The identity and address of any express trust fund described
in Section 3111 to which employer payments are due.
   (4) The total number of straight time and overtime hours on each
job.
   (5) The amount then past due and owing.
   Failure to give this notice shall constitute grounds for
disciplinary action by the Registrar of Contractors.
   (l) Every written contract entered into between a property owner
and an original contractor shall provide space for the owner to enter
his or her name , residence address, and place of business if any.
The original contractor shall make available the name and address of
residence of the owner to any person seeking to serve the notice
specified in subdivision (c).
   (m) Every written contract entered into between a property owner
and an original contractor, except home improvement contracts and
swimming pool contracts subject to Article 10 (commencing with
Section 7150) of Chapter 9 of Division 3 of the Business and
Professions Code, shall provide space for the owner to enter the name
and address of the construction lender or lenders.  The original
contractor shall make available the name and address of the
construction lender or lenders to any person seeking to serve the
notice specified in subdivision (c).  Every contract entered into
between an original contractor and subcontractor, and between
subcontractors, shall provide a space for the name and address of the
owner, original contractor, and any construction lender.
   (n) Where one or more construction loans are obtained after
commencement of construction, the property owner shall provide the
name and address of the construction lender or lenders to each person
who has given the property owner the notice specified in subdivision
(c).
   (o) (1) Each person who has served a preliminary 20-day notice
pursuant to subdivision (f) may file the preliminary 20-day notice
with the county recorder in the county in which any portion of the
property is located.  A preliminary 20-day notice filed pursuant to
this section shall contain all of the following:
   (A) The name and address of the person furnishing the labor,
service, equipment, or materials.
   (B) The name of the person who contracted for purchase of the
labor, services, equipment, or materials.
   (C) The common street address of the jobsite.
   (2) Upon the acceptance for recording of a notice of completion or
notice of cessation the county recorder shall mail to those persons
who have filed a preliminary 20-day notice, notification that a
notice of completion or notice of cessation has been recorded on the
property, and shall affix the date that the notice of completion or
notice of cessation was recorded with the county recorder.
   (3) The failure of the county recorder to mail the notification to
the person who filed a preliminary 20-day notice, or the failure of
those persons to receive the notification or to receive complete
notification, shall not affect the period within which a claim of
lien is required to be recorded.  However, the county recorder shall
make a good faith effort to mail notification to those persons who
have filed the preliminary 20-day notice under this section and to do
so within five days after the recording of a notice of completion or
notice of cessation.
   (4) This new function of the county recorder shall not become
operative until July 1, 1988.  The county recorder may cause to be
destroyed all documents filed pursuant to this section, two years
after the date of filing.
   (5) The preliminary 20-day notice that a person may file pursuant
to this subdivision is for the limited purpose of facilitating the
mailing of notice by the county recorder of recorded notices of
completion and notices of cessation.  The notice that is filed is not
a recordable document and shall not be entered into those official
records of the county which by law impart constructive notice.
Notwithstanding any other provision of law, the index maintained by
the recorder of filed preliminary 20-day notices shall be separate
and distinct from those indexes maintained by the county recorder of
those official records of the county which by law impart constructive
notice.  The filing of a preliminary 20-day notice with the county
recorder does not give rise to any actual or constructive notice with
respect to any party of the existence or contents of a filed
preliminary 20-day notice nor to any duty of inquiry on the part of
any party as to the existence or contents of that notice.
   (p) (1) The change made to the statement described in subdivision
(c) by Chapter 974 of the Statutes of 1994 shall have no effect upon
the validity of any notice that otherwise meets the requirements of
this section.  The failure to provide, pursuant to Chapter 974 of the
Statutes of 1994, a written preliminary notice to a subcontractor
with whom the claimant has contracted shall not affect the validity
of any preliminary notice provided pursuant to this section.
   (2) (A) The inclusion of the language added to paragraph (5) of
subdivision (c) by Chapter 795 of the Statutes of 1999, shall not
affect the validity of any preliminary notice given on or after
January 1, 2000, and prior to the operative date of the amendments to
this section enacted at the 2000 portion of the 1999-2000 Regular
Session, that otherwise meets the requirements of that subdivision.
   (B) A preliminary notice given on or after January 1, 2000, and
prior to the operative date of the amendments to this section enacted
at the 2000 portion of the 1999-2000 Regular Session, shall not be
invalid because of the failure to include the language added to
paragraph (5) of subdivision (c) by Chapter 795 of the Statutes of
1999, if the notice otherwise complies with that subdivision.
   (C) The failure to provide an affidavit form or notice of rights,
or both, pursuant to the requirements of Chapter 795 of the Statutes
of 1999, shall not affect the validity of any preliminary notice
pursuant to this section.
  SEC. 38.  Section 403.020 of the Code of Civil Procedure is amended
to read:
   403.020.  (a) If a plaintiff, cross-complainant, or petitioner
files an amended complaint or other amended initial pleading that
changes the jurisdictional classification from that previously stated
in the caption, and simultaneously pays the reclassification fees
provided in Section 403.050, the clerk shall promptly reclassify the
case.
   (b) For purposes of this section, an amendment to an initial
pleading shall be treated in the same manner as an amended initial
pleading.
  SEC. 38.5.  Section 645.1 of the Code of Civil Procedure is amended
to read:
   645.1.  (a) When a referee is appointed pursuant to Section 638,
the referee's fees shall be paid as agreed by the parties.  If the
parties do not agree on the payment of fees and request the matter to
be resolved by the court, the court may order the parties to pay the
referee's fees as set forth in subdivision (b).
   (b) When a referee is appointed pursuant to Section 639, at any
time after a determination of ability to pay is made as specified in
paragraph (6) of subdivision (d) of Section 639, the court may order
the parties to pay the fees of referees who are not employees or
officers of the court at the time of appointment, as fixed pursuant
to Section 1023, in any manner determined by the court to be fair and
reasonable, including an apportionment of the fees among the
parties.  For purposes of this section, the term "parties" does not
include parties' counsel.
  SEC. 39.  Section 674 of the Code of Civil Procedure is amended to
read:
   674.  (a) Except as otherwise provided in Section 4506 of the
Family Code, an abstract of a judgment or decree requiring the
payment of money shall be certified by the clerk of the court where
the judgment or decree was entered and shall contain all of the
following:
   (1) The title of the court where the judgment or decree is entered
and cause and number of the action.
   (2) The date of entry of the judgment or decree and of any
renewals of the judgment or decree and where entered in the records
of the court.
   (3) The name and last known address of the judgment debtor and the
address at which the summons was either personally served or mailed
to the judgment debtor or the judgment debtor's attorney of record.
   (4) The name and address of the judgment creditor.
   (5) The amount of the judgment or decree as entered or as last
renewed.
   (6) The social security number and driver's license number of the
judgment debtor if they are known to the judgment creditor.  If
either or both of those numbers are not known to the judgment
creditor, that fact shall be indicated on the abstract of judgment.
   (7) Whether a stay of enforcement has been ordered by the court
and, if so, the date the stay ends.
   (8) The date of issuance of the abstract.
   (b) An abstract of judgment, recorded after January 1, 1979, that
does not list the social security number and driver's license number
of the judgment debtor, or either of them, as required by subdivision
(a) or by Section 4506 of the Family Code, may be amended by the
recording of a document entitled "Amendment to Abstract of Judgment."
  The Amendment to Abstract of Judgment shall contain all of the
information required by this section or by Section 4506 of the Family
Code, shall list both the social security number and driver's
license number if both of those numbers were known at the date of
recordation of the original abstract of judgment, or one of them, if
only one was known, and shall set forth the date of recording and the
book and page location in the records of the county recorder of the
original abstract of judgment.
   A recorded Amendment to Abstract of Judgment shall have priority
as of the date of recordation of the original abstract of judgment,
except as to any purchaser, encumbrancer, or lessee who obtained
their interest after the recordation of the original abstract of
judgment but prior to the recordation of the Amendment to Abstract of
Judgment without actual notice of the original abstract of judgment.
  The purchaser, encumbrancer, or lessee without actual notice may
assert as a defense against enforcement of the abstract of judgment
the failure to comply with this section or Section 4506 of the Family
Code regarding the contents of the original abstract of judgment
notwithstanding the subsequent recordation of an Amendment to
Abstract of Judgment.  With respect to an abstract of judgment
recorded between January 1, 1979, and July 10, 1985, the defense
against enforcement for failure to comply with this section or
Section 4506 of the Family Code may not be asserted by the holder of
another abstract of judgment or involuntary lien, recorded without
actual notice of the prior abstract, unless refusal to allow the
defense would result in prejudice and substantial injury as used in
Section 475.  The recordation of an Amendment to Abstract of Judgment
does not extend or otherwise alter the computation of time as
provided in Section 697.310.
   (c) (1) The abstract of judgment shall be certified in the name of
the judgment debtor as listed on the judgment and may also include
the additional name or names by which the judgment debtor is known as
set forth in the affidavit of identity, as defined in Section
680.135, filed by the judgment creditor with the application for
issuance of the abstract of judgment.  Prior to the clerk of the
court certifying an abstract of judgment containing any additional
name or names by which the judgment debtor is known that are not
listed on the judgment, the court shall approve the affidavit of
identity.  If the court determines, without a hearing or a notice,
that the affidavit of identity states sufficient facts upon which the
judgment creditor has identified the additional names of the
judgment debtor, the court shall authorize the certification of the
abstract of judgment with the additional name or names.
   (2) The remedies provided in Section 697.410 apply to a recorded
abstract of a money judgment based upon an affidavit of identity that
appears to create a judgment lien on real property of a person who
is not the judgment debtor.
  SEC. 40.  Section 699.510 of the Code of Civil Procedure is amended
to read:
   699.510.  (a) Subject to subdivision (b), after entry of a money
judgment, a writ of execution shall be issued by the clerk of the
court upon application of the judgment creditor and shall be directed
to the levying officer in the county where the levy is to be made
and to any registered process server.  A separate writ shall be
issued for each county where a levy is to be made.  Writs may be
issued successively until the money judgment is satisfied, except
that a new writ may not be issued for a county until the expiration
of 180 days after the issuance of a prior writ for that county unless
the prior writ is first returned.
   (b) If the judgment creditor seeks a writ of execution to enforce
a judgment made, entered, or enforceable pursuant to the Family Code,
in addition to the requirements of this article, the judgment
creditor shall satisfy the requirements of any applicable provisions
of the Family Code.
   (c) (1) The writ of execution shall be issued in the name of the
judgment debtor as listed on the judgment and may include the
additional name or names by which the judgment debtor is known as set
forth in the affidavit of identity, as defined in Section 680.135,
filed by the judgment creditor with the application for issuance of
the writ of execution.  Prior to the clerk of the court issuing a
writ of execution containing any additional name or names by which
the judgment debtor is known that are not listed on the judgment, the
court shall approve the affidavit of identity.  If the court
determines, without a hearing or a notice, that the affidavit of
identity states sufficient facts upon which the judgment creditor has
identified the additional names of the judgment debtor, the court
shall authorize the issuance of the writ of execution with the
additional name or names.
   (2) In any case where the writ of execution lists any name other
than that listed on the judgment, the person in possession or control
of the levied property, if other than the judgment debtor, shall not
pay to the levying officer the amount or deliver the property being
levied upon until being notified to do so by the levying officer.
The levying officer may not require the person, if other than the
judgment debtor, in possession or control of the levied property to
pay the amount or deliver the property levied upon until the
expiration of 15 days after service of notice of levy.
   (3) If a person who is not the judgment debtor has property
erroneously subject to an enforcement of judgment proceeding based
upon an affidavit of identity, the person shall be entitled to the
recovery of reasonable attorney's fees and costs from the judgment
creditor incurred in releasing the person's property from a writ of
execution, in addition to any other damages or penalties to which an
aggrieved person may be entitled to by law, including the provisions
of Division 4 (commencing with Section 720.010).
  SEC. 41.  Section 9323 of the Commercial Code is amended to read:
   9323.  (a) Except as otherwise provided in subdivision (c), for
purposes of determining the priority of a perfected security interest
under paragraph (1) of subdivision (a) of Section 9322, perfection
of the security interest dates from the time an advance is made to
the extent that the security interest secures an advance that
satisfies both of the following conditions:
   (1) It is made while the security interest is perfected only under
either of the following:
   (A) Under Section 9309 when it attaches.
   (B) Temporarily under subdivision (e), (f), or (g) of Section
9312.
   (2) It is not made pursuant to a commitment entered into before or
while the security interest is perfected by a method other than
under Section 9309 or under subdivision (e), (f), or (g) of Section
9312.
   (b) Except as otherwise provided in subdivision (c), a security
interest is subordinate to the rights of a person who becomes a lien
creditor to the extent that the security interest secures an advance
made more than 45 days after the person becomes a lien creditor
unless either of the following conditions is satisfied:
   (1) The advance is made without knowledge of the lien.
   (2) The advance is made pursuant to a commitment entered into
without knowledge of the lien.
   (c) Subdivisions (a) and (b) do not apply to a security interest
held by a secured party who is a buyer of accounts, chattel paper,
payment intangibles, or promissory notes or a consignor.
   (d) Except as otherwise provided in subdivision (e), a buyer of
goods other than a buyer in the ordinary course of business takes
free of a security interest to the extent that it secures advances
made after the earlier of the following:
   (1) The time the secured party acquires knowledge of the buyer's
purchase.
   (2) Forty-five days after the purchase.
   (e) Subdivision (d) does not apply if the advance is made pursuant
to a commitment entered into without knowledge of the buyer's
purchase and before the expiration of the 45-day period.
   (f) Except as otherwise provided in subdivision (g), a lessee of
goods, other than a lessee in the ordinary course of business, takes
the leasehold interest free of a security interest to the extent that
it secures advances made after the earlier of either of the
following:
   (1) The time the secured party acquires knowledge of the lease.
   (2) Forty-five days after the lease contract becomes enforceable.

   (g) Subdivision (f) does not apply if the advance is made pursuant
to a commitment entered into without knowledge of the lease and
before the expiration of the 45-day period.
  SEC. 42.  Section 9331 of the Commercial Code is amended to read:
   9331.  (a) This division does not limit the rights of a holder in
due course of a negotiable instrument, a holder to which a negotiable
document of title has been duly negotiated, or a protected purchaser
of a security.  These holders or purchasers take priority over an
earlier security interest, even if perfected, to the extent provided
in Division 3 (commencing with Section 3101), Division 7 (commencing
with Section 7101), and Division 8 (commencing with Section 8101).
   (b) This division does not limit the rights of or impose liability
on a person to the extent that the person is protected against the
assertion of a claim under Division 8 (commencing with Section 8101).

   (c) Filing under this division does not constitute notice of a
claim or defense to the holders, purchasers, or persons described in
subdivisions (a) and (b).
  SEC. 43.  Section 9408 of the Commercial Code is amended to read:
   9408.  (a) Except as otherwise provided in subdivision (b), a term
in a promissory note or in an agreement between an account debtor
and a debtor that relates to a health care insurance receivable or a
general intangible, including a contract, permit, license, or
franchise, and which term prohibits, restricts, or requires the
consent of the person obligated on the promissory note or the account
debtor to, the assignment or transfer of, or the creation,
attachment, or perfection of a security interest in, the promissory
note, health care                                          insurance
receivable, or general intangible, is ineffective to the extent that
the term does, or would do, either of the following:
   (1) It would impair the creation, attachment, or perfection of a
security interest.
   (2) It provides that the assignment or transfer or the creation,
attachment, or perfection of the security interest may give rise to a
default, breach, right of recoupment, claim, defense, termination,
right of termination, or remedy under the promissory note, health
care insurance receivable, or general intangible.
   (b) Subdivision (a) applies to a security interest in a payment
intangible or promissory note only if the security interest arises
out of a sale of the payment intangible or promissory note.
   (c) A rule of law, statute, or regulation that prohibits,
restricts, or requires the consent of a government, governmental body
or official, person obligated on a promissory note, or account
debtor to the assignment or transfer of, or the creation of a
security interest in, a promissory note, health care insurance
receivable, or general intangible, including a contract, permit,
license, or franchise between an account debtor and a debtor, is
ineffective to the extent that the rule of law, statute, or
regulation does, or would do, either of the following:
   (1) It would impair the creation, attachment, or perfection of a
security interest.
   (2) It provides that the assignment or transfer or the creation,
attachment, or perfection of the security interest may give rise to a
default, breach, right of recoupment, claim, defense, termination,
right of termination, or remedy under the promissory note, health
care insurance receivable, or general intangible.
   (d) To the extent that a term in a promissory note or in an
agreement between an account debtor and a debtor that relates to a
health care insurance receivable or general intangible or a rule of
law, statute, or regulation described in subdivision (c) would be
effective under law other than this division but is ineffective under
subdivision (a) or (c), all of the following rules apply with
respect to the creation, attachment, or perfection of a security
interest in the promissory note, health care insurance receivable, or
general intangible:
   (1) It is not enforceable against the person obligated on the
promissory note or the account debtor.
   (2) It does not impose a duty or obligation on the person
obligated on the promissory note or the account debtor.
   (3) It does not require the person obligated on the promissory
note or the account debtor to recognize the security interest, pay or
render performance to the secured party, or accept payment or
performance from the secured party.
   (4) It does not entitle the secured party to use or assign the
debtor's rights under the promissory note, health care insurance
receivable, or general intangible, including any related information
or materials furnished to the debtor in the transaction giving rise
to the promissory note, health care insurance receivable, or general
intangible.
   (5) It does not entitle the secured party to use, assign, possess,
or have access to any trade secrets or confidential information of
the person obligated on the promissory note or the account debtor.
   (6) It does not entitle the secured party to enforce the security
interest in the promissory note, health care insurance receivable, or
general intangible.
   (e) Subdivision (c) does not apply to an assignment or transfer
of, or the creation, attachment, perfection, or enforcement of a
security interest in, a claim or right to receive compensation for
injuries or sickness as described in paragraph (1) or (2) of
subdivision (a) of Section 104 of Title 26 of the United States Code,
as amended, or a claim or right to receive benefits under a special
needs trust as described in paragraph (4) of subdivision (d) of
Section 1396p of Title 42 of the United States Code, as amended, to
the extent that subdivision (c) is inconsistent with those laws.
  SEC. 44.  Section 2200 of the Corporations Code is amended to read:

   2200.  Every corporation that neglects, fails, or refuses:  (a) to
keep or cause to be kept or maintained the record of shareholders or
books of account required by this division to be kept or maintained,
(b) to prepare or cause to be prepared or submitted the financial
statements required by this division to be prepared or submitted, or
(c) to give any shareholder of record the advice required by
subdivision (f) of Section 2115, is subject to penalty as provided in
this section.
   The penalty shall be twenty-five dollars ($25) for each day that
the failure or refusal continues, up to a maximum of one thousand
five hundred dollars ($1,500), beginning 30 days after receipt of the
written request that the duty be performed from one entitled to make
the request, except that, in the case of a failure to give advice
required by subdivision (f) of Section 2115, the 30-day period shall
run from the date of receipt of the request made pursuant to
subdivision (f) of Section 2115, and no additional request is
required by this section.
   The penalty shall be paid to the shareholder or shareholders
jointly making the request for performance of the duty, and damaged
by the neglect, failure, or refusal, if suit therefor is commenced
within 90 days after the written request is made, including any
request made pursuant to subdivision (f) of Section 2115; but the
maximum daily penalty because of failure to comply with any number of
separate requests made on any one day or for the same act shall be
two hundred fifty dollars ($250).
  SEC. 45.  Section 6810 of the Corporations Code is amended to read:

   6810.  (a) Upon the failure of a corporation to file the statement
required by Section 6210, the Secretary of State shall mail a notice
of that delinquency to the corporation.  The notice shall also
contain information concerning the application of this section, and
advise the corporation of the penalty imposed by Section 19141 of the
Revenue and Taxation Code for failure to timely file the required
statement after notice of delinquency has been mailed by the
Secretary of State.  If, within 60 days after the mailing of the
notice of delinquency, a statement pursuant to Section 6210 has not
been filed by the corporation, the Secretary of State may pursuant to
regulation certify the name of the corporation to the Franchise Tax
Board.
   (b) Upon certification pursuant to subdivision (a), the Franchise
Tax Board shall assess against the corporation a penalty of fifty
dollars ($50) pursuant to Section 19141 of the Revenue and Taxation
Code.
   (c) The penalty herein provided shall not apply to a corporation
that on or prior to the date of certification pursuant to subdivision
(a) has dissolved or has been merged into another corporation.
   (d) The penalty herein provided shall not apply and the Secretary
of State need not mail a notice of delinquency to a corporation the
corporate powers, rights, and privileges of which have been suspended
by the Franchise Tax Board pursuant to Section 23301, 23301.5, or
23775 of the Revenue and Taxation Code on or prior to, and remain
suspended on, the last day of the filing period pursuant to Section
6210.  The Secretary of State need not mail a form pursuant to
Section 6210 to a corporation the corporate powers, rights, and
privileges of which have been so suspended by the Franchise Tax Board
on or prior to, and remain suspended on, the day the Secretary of
State prepares the forms for mailing.
   (e) If, after certification pursuant to subdivision (a), the
Secretary of State finds the required statement was filed before the
expiration of the 60-day period after mailing of the notice of
delinquency, the Secretary of State shall promptly decertify the name
of the corporation to the Franchise Tax Board.  The Franchise Tax
Board shall then promptly abate any penalty assessed against the
corporation pursuant to Section 19141 of the Revenue and Taxation
Code.
   (f) If the Secretary of State determines that the failure of a
corporation to file a statement required by Section 6210 is excusable
because of reasonable cause or unusual circumstances that justify
the failure, the Secretary of State may waive the penalty imposed by
this section and by Section 19141 of the Revenue and Taxation Code,
in which case the Secretary of State shall not certify the name of
the corporation to the Franchise Tax Board, or if already certified,
the Secretary of State shall promptly decertify the name of the
corporation.
  SEC. 46.  Section 17540.3 of the Corporations Code is amended to
read:
   17540.3.  (a) A limited liability company that desires to convert
to another business entity or a foreign other business entity or a
foreign limited liability company shall approve a plan of conversion.

   The plan of conversion shall state all of the following:
   (1) The terms and conditions of the conversion.
   (2) The place of the organization of the converted entity and of
the converting limited liability company and the name of the
converted entity after conversion.
   (3) The manner of converting the membership interests of each of
the members into securities of, or interests in, the converted
entity.
   (4) The provisions of the governing documents for the converted
entity, including the partnership agreement, to which the holders of
interests in the converted entity are to be bound.
   (5) Any other details or provisions that are required by the laws
under which the converted entity is organized, or that are desired by
the parties.
   (b) The plan of conversion shall be approved by a vote of a
majority in interest of the members of the converting limited
liability company, or a greater percentage of the voting interests of
members as may be specified in the articles of organization or
written operating agreement of the converting limited liability
company.  However, if the members of the limited liability company
would become personally liable for any obligations of the converted
entity as a result of the conversion, the plan of conversion shall be
approved by all of the members of the converting limited liability
company, unless the plan of conversion provides that all members will
have dissenters' rights as provided in Chapter 13 (commencing with
Section 17600).
   (c) If the limited liability company is converting into a limited
partnership, then in addition to the approval of the members set
forth in subdivision (b), the plan of conversion shall be approved by
those members who will become general partners of the converted
limited partnership pursuant to the plan of conversion.
   (d) Upon the effectiveness of the conversion, all members of the
converting limited liability company, except those that exercise
dissenters' rights as provided in Chapter 13 (commencing with Section
17600), shall be deemed parties to any governing documents for the
converted entity adopted as part of the plan of conversion,
irrespective of whether or not a member has executed the plan of
conversion or the governing documents for the converted entity.  Any
adoption of governing documents made pursuant thereto shall be
effective at the effective time or date of the conversion.
   (e) Notwithstanding its prior approval, a plan of conversion may
be amended before the conversion takes effect if the amendment is
approved by the members of the converting limited liability company
in the same manner as was required for approval of the original plan
of conversion.
   (f) A plan of conversion may be abandoned by the members of a
converting limited liability company in the manner as required for
approval of the plan of conversion, subject to the contractual rights
of third parties, at any time before the conversion is effective.
   (g) The converted entity shall keep the plan of conversion at the
principal place of business of the converted entity if the converted
entity is a domestic partnership or foreign other business entity or
at the office at which records are to be kept under Section 15614 if
the converted entity is a domestic limited partnership. Upon the
request of a member of a converting limited liability company, the
authorized person on behalf of the converted entity shall promptly
deliver to the member or the holder of interests or other securities,
at the expense of the converted entity, a copy of the plan of
conversion.  A waiver by a member of the rights provided in this
subdivision shall be unenforceable.
  SEC. 47.  Section 25102 of the Corporations Code is amended to
read:
   25102.  The following transactions are exempted from the
provisions of Section 25110:
   (a) Any offer (but not a sale) not involving any public offering
and the execution and delivery of any agreement for the sale of
securities pursuant to the offer if (1) the agreement contains
substantially the following provision:  "The sale of the securities
that are the subject of this agreement has not been qualified with
the Commissioner of Corporations of the State of California and the
issuance of the securities or the payment or receipt of any part of
the consideration therefor prior to the qualification is unlawful,
unless the sale of securities is exempt from the qualification by
Section 25100, 25102, or 25105 of the California Corporations Code.
The rights of all parties to this agreement are expressly conditioned
upon the qualification being obtained, unless the sale is so exempt"
; and (2) no part of the purchase price is paid or received and none
of the securities are issued until the sale of the securities is
qualified under this law unless the sale of securities is exempt from
the qualification by this section, Section 25100, or 25105.
   (b) Any offer (but not a sale) of a security for which a
registration statement has been filed under the Securities Act of
1933 but has not yet become effective, or for which an offering
statement under Regulation A has been filed but has not yet been
qualified, if no stop order or refusal order is in effect and no
public proceeding or examination looking toward that order is pending
under Section 8 of the act and no order under Section 25140 or
subdivision (a) of Section 25143 is in effect under this law.
   (c) Any offer (but not a sale) and the execution and delivery of
any agreement for the sale of securities pursuant to the offer as may
be permitted by the commissioner upon application.  Any negotiating
permit under this subdivision shall be conditioned to the effect that
none of the securities may be issued and none of the consideration
therefor may be received or accepted until the sale of the securities
is qualified under this law.
   (d) Any transaction or agreement between the issuer and an
underwriter or among underwriters if the sale of the securities is
qualified, or exempt from qualification, at the time of distribution
thereof in this state, if any.
   (e) Any offer or sale of any evidence of indebtedness, whether
secured or unsecured, and any guarantee thereof, in a transaction not
involving any public offering.
   (f) Any offer or sale of any security in a transaction (other than
an offer or sale to a pension or profit-sharing trust of the issuer)
that meets each of the following criteria:
   (1) Sales of the security are not made to more than 35 persons,
including persons not in this state.
   (2) All purchasers either have a preexisting personal or business
relationship with the offeror or any of its partners, officers,
directors or controlling persons, or managers (as appointed or
elected by the members) if the offeror is a limited liability
company, or by reason of their business or financial experience or
the business or financial experience of their professional advisors
who are unaffiliated with and who are not compensated by the issuer
or any affiliate or selling agent of the issuer, directly or
indirectly, could be reasonably assumed to have the capacity to
protect their own interests in connection with the transaction.
   (3) Each purchaser represents that the purchaser is purchasing for
the purchaser's own account (or a trust account if the purchaser is
a trustee) and not with a view to or for sale in connection with any
distribution of the security.
   (4) The offer and sale of the security is not accomplished by the
publication of any advertisement.  The number of purchasers referred
to above is exclusive of any described in subdivision (i), any
officer, director, or affiliate of the issuer, or manager (as
appointed or elected by the members) if the issuer is a limited
liability company, and any other purchaser who the commissioner
designates by rule.  For purposes of this section, a husband and wife
(together with any custodian or trustee acting for the account of
their minor children) are counted as one person and a partnership,
corporation, or other organization that was not specifically formed
for the purpose of purchasing the security offered in reliance upon
this exemption, is counted as one person.  The commissioner may by
rule require the issuer to file a notice of transactions under this
subdivision.  However, the failure to file the notice or the failure
to file the notice within the time specified by the rule of the
commissioner shall not affect the availability of this exemption.  An
issuer who fails to file the notice as provided by rule of the
commissioner shall, within 15 business days after demand by the
commissioner, file the notice and pay to the commissioner a fee equal
to the fee payable had the transaction been qualified under Section
25110.
   (g) Any offer or sale of conditional sale agreements, equipment
trust certificates, or certificates of interest or participation
therein or partial assignments thereof, covering the purchase of
railroad rolling stock or equipment or the purchase of motor
vehicles, aircraft, or parts thereof, in a transaction not involving
any public offering.
   (h) Any offer or sale of voting common stock by a corporation
incorporated in any state if, immediately after the proposed sale and
issuance, there will be only one class of stock of the corporation
outstanding that is owned beneficially by no more than 35 persons,
provided all of the following requirements have been met:
   (1) The offer and sale of the stock is not accompanied by the
publication of any advertisement, and no selling expenses have been
given, paid, or incurred in connection therewith.
   (2) The consideration to be received by the issuer for the stock
to be issued consists of any of the following:
   (A) Only assets (which may include cash) of an existing business
enterprise transferred to the issuer upon its initial organization,
of which all of the persons who are to receive the stock to be issued
pursuant to this exemption were owners during, and the enterprise
was operated for, a period of not less than one year immediately
preceding the proposed issuance, and the ownership of the enterprise
immediately prior to the proposed issuance was in the same
proportions as the shares of stock are to be issued.
   (B) Only cash or cancellation of indebtedness for money borrowed,
or both, upon the initial organization of the issuer, provided all of
the stock is issued for the same price per share.
   (C) Only cash, provided the sale is approved in writing by each of
the existing shareholders and the purchaser or purchasers are
existing shareholders.
   (D) In a case where after the proposed issuance there will be only
one owner of the stock of the issuer, only any legal consideration.

   (3) No promotional consideration has been given, paid, or incurred
in connection with the issuance.  Promotional consideration means
any consideration paid directly or indirectly to a person who, acting
alone or in conjunction with one or more other persons, takes the
initiative in founding and organizing the business or enterprise of
an issuer for services rendered in connection with the founding or
organizing.
   (4) A notice in a form prescribed by rule of the commissioner,
signed by an active member of the State Bar of California, is filed
with or mailed for filing to the commissioner not later than 10
business days after receipt of consideration for the securities by
the issuer.  That notice shall contain an opinion of the member of
the State Bar of California that the exemption provided by this
subdivision is available for the offer and sale of the securities.
However, the failure to file the notice as required by this paragraph
and the rules of the commissioner shall not affect the availability
of this exemption.  An issuer who fails to file the notice within the
time specified by this paragraph shall, within 15 business days
after demand by the commissioner, file the notice and pay to the
commissioner a fee equal to the fee payable had the transaction been
qualified under Section 25110.  The notice, except when filed on
behalf of a California corporation, shall be accompanied by an
irrevocable consent, in the form that the commissioner by rule
prescribes, appointing the commissioner or his or her successor in
office to be the issuer's attorney to receive service of any lawful
process in any noncriminal suit, action, or proceeding against it or
its successor that arises under this law or any rule or order
hereunder after the consent has been filed, with the same force and
validity as if served personally on the issuer.  An issuer on whose
behalf a consent has been filed in connection with a previous
qualification or exemption from qualification under this law (or
application for a permit under any prior law if the application or
notice under this law states that the consent is still effective)
need not file another.  Service may be made by leaving a copy of the
process in the office of the commissioner, but it is not effective
unless (A) the plaintiff, who may be the commissioner in a suit,
action, or proceeding instituted by him or her, forthwith sends
notice of the service and a copy of the process by registered or
certified mail to the defendant or respondent at its last address on
file with the commissioner, and (B) the plaintiff's affidavit of
compliance with this section is filed in the case on or before the
return day of the process, if any, or within the further time as the
court allows.
   (5) Each purchaser represents that the purchaser is purchasing for
the purchaser's own account, or a trust account if the purchaser is
a trustee, and not with a view to or for sale in connection with any
distribution of the stock.
   For the purposes of this subdivision, all securities held by a
husband and wife, whether or not jointly, shall be considered to be
owned by one person, and all securities held by a corporation that
has issued stock pursuant to this exemption shall be considered to be
held by the shareholders to whom it has issued the stock.
   All stock issued by a corporation pursuant to this subdivision as
it existed prior to the effective date of the amendments to this
section made during the 1996 portion of the 1995-96 Regular Session
that required the issuer to have stamped or printed prominently on
the face of the stock certificate a legend in a form prescribed by
rule of the commissioner restricting transfer of the stock in a
manner provided for by that rule shall not be subject to the transfer
restriction legend requirement and, by operation of law, the
corporation is authorized to remove that transfer restriction legend
from the certificates of those shares of stock issued by the
corporation pursuant to this subdivision as it existed prior to the
effective date of the amendments to this section made during the 1996
portion of the 1995-96 Regular Session.
   (i) Any offer or sale (1) to a bank, savings and loan association,
trust company, insurance company, investment company registered
under the Investment Company Act of 1940, pension or profit-sharing
trust (other than a pension or profit-sharing trust of the issuer, a
self-employed individual retirement plan, or individual retirement
account), or other institutional investor or governmental agency or
instrumentality that the commissioner may designate by rule, whether
the purchaser is acting for itself or as trustee, or (2) to any
corporation with outstanding securities registered under Section 12
of the Securities Exchange Act of 1934 or any wholly owned subsidiary
of the corporation that after the offer and sale will own directly
or indirectly 100 percent of the outstanding capital stock of the
issuer, provided the purchaser represents that it is purchasing for
its own account (or for the trust account) for investment and not
with a view to or for sale in connection with any distribution of the
security.
   (j) Any offer or sale of any certificate of interest or
participation in an oil or gas title or lease (including subsurface
gas storage and payments out of production) if either of the
following apply:
   (1) All of the purchasers meet one of the following requirements:

   (A) Are and have been during the preceding two years engaged
primarily in the business of drilling for, producing, or refining oil
or gas (or whose corporate predecessor, in the case of a
corporation, has been so engaged).
   (B) Are persons described in paragraph (1) of subdivision (i).
   (C) Have been found by the commissioner upon written application
to be substantially engaged in the business of drilling for,
producing, or refining oil or gas so as not to require the protection
provided by this law (which finding shall be effective until
rescinded).
   (2) The security is concurrently hypothecated to a bank in the
ordinary course of business to secure a loan made by the bank,
provided that each purchaser represents that it is purchasing for its
own account for investment and not with a view to or for sale in
connection with any distribution of the security.
   (k) Any offer or sale of any security under, or pursuant to, a
plan of reorganization under Chapter 11 of the federal bankruptcy law
that has been confirmed or is subject to confirmation by the decree
or order of a court of competent jurisdiction.
   (l) Any offer or sale of an option, warrant, put, call, or
straddle, and any guarantee of any of these securities, by a person
who is not the issuer of the security subject to the right, if the
transaction, had it involved an offer or sale of the security subject
to the right by the person, would not have violated Section 25110 or
25130.
   (m) Any offer or sale of a stock to a pension, profit-sharing,
stock bonus, or employee stock ownership plan, provided that (1) the
plan meets the requirements for qualification under Section 401 of
the Internal Revenue Code, and (2) the employees are not required or
permitted individually to make any
        contributions to the plan.  The exemption provided by this
subdivision shall not be affected by whether the stock is contributed
to the plan, purchased from the issuer with contributions by the
issuer or an affiliate of the issuer, or purchased from the issuer
with funds borrowed from the issuer, an affiliate of the issuer, or
any other lender.
   (n) Any offer or sale of any security in a transaction, other than
an offer or sale of a security in a rollup transaction, that meets
all of the following criteria:
   (1) The issuer is (A) a California corporation or foreign
corporation that, at the time of the filing of the notice required
under this subdivision, is subject to Section 2115, or (B) any other
form of business entity, including without limitation a partnership
or trust organized under the laws of this state.  The exemption
provided by this subdivision is not available to a "blind pool"
issuer, as that term is defined by the commissioner, or to an
investment company subject to the Investment Company Act of 1940.
   (2) Sales of securities are made only to qualified purchasers or
other persons the issuer reasonably believes, after reasonable
inquiry, to be qualified purchasers.  A corporation, partnership, or
other organization specifically formed for the purpose of acquiring
the securities offered by the issuer in reliance upon this exemption
may be a qualified purchaser if each of the equity owners of the
corporation, partnership, or other organization is a qualified
purchaser.  Qualified purchasers include the following:
   (A) A person designated in Section 260.102.13 of Title 10 of the
California Code of Regulations.
   (B) A person designated in subdivision (i) or any rule of the
commissioner adopted thereunder.
   (C) A pension or profit-sharing trust of the issuer, a
self-employed individual retirement plan, or an individual retirement
account, if the investment decisions made on behalf of the trust,
plan, or account are made solely by persons who are qualified
purchasers.
   (D) An organization described in Section 501(c)(3) of the Internal
Revenue Code, corporation, Massachusetts or similar business trust,
or partnership, each with total assets in excess of five million
dollars ($5,000,000) according to its most recent audited financial
statements.
   (E) With respect to the offer and sale of one class of voting
common stock of an issuer or of preferred stock of an issuer
entitling the holder thereof to at least the same voting rights as
the issuer's one class of voting common stock, provided that the
issuer has only one-class voting common stock outstanding upon
consummation of the offer and sale, a natural person who, either
individually or jointly with the person's spouse, (i) has a minimum
net worth of two hundred fifty thousand dollars ($250,000) and had,
during the immediately preceding tax year, gross income in excess of
one hundred thousand dollars ($100,000) and reasonably expects gross
income in excess of one hundred thousand dollars ($100,000) during
the current tax year or (ii) has a minimum net worth of five hundred
thousand dollars ($500,000).  "Net worth" shall be determined
exclusive of home, home furnishings, and automobiles.  Other assets
included in the computation of net worth may be valued at fair market
value.
   Each natural person specified above, by reason of his or her
business or financial experience, or the business or financial
experience of his or her professional adviser, who is unaffiliated
with and who is not compensated, directly or indirectly, by the
issuer or any affiliate or selling agent of the issuer, can be
reasonably assumed to have the capacity to protect his or her
interests in connection with the transaction.  The amount of the
investment of each natural person shall not exceed 10 percent of the
net worth, as determined by this subparagraph, of that natural
person.
   (F) Any other purchaser designated as qualified by rule of the
commissioner.
   (3) Each purchaser represents that the purchaser is purchasing for
the purchaser's own account (or trust account, if the purchaser is a
trustee) and not with a view to or for sale in connection with a
distribution of the security.
   (4) Each natural person purchaser, including a corporation,
partnership, or other organization specifically formed by natural
persons for the purpose of acquiring the securities offered by the
issuer, receives, at least five business days before securities are
sold to, or a commitment to purchase is accepted from, the purchaser,
a written offering disclosure statement that shall meet the
disclosure requirements of Regulation D (17 C.F.R. 230.501 et seq.),
and any other information as may be prescribed by rule of the
commissioner, provided that the issuer shall not be obligated
pursuant to this paragraph to provide this disclosure statement to a
natural person qualified under Section 260.102.13 of Title 10 of the
California Code of Regulations.  The offer or sale of securities
pursuant to a disclosure statement required by this paragraph that is
in violation of Section 25401, or that fails to meet the disclosure
requirements of Regulation D (17 C.F.R. 230.501 et seq.), shall not
render unavailable to the issuer the claim of an exemption from
Section 25110 afforded by this subdivision.  This paragraph does not
impose, directly or indirectly, any additional disclosure obligation
with respect to any other exemption from qualification available
under any other provision of this section.
   (5) (A) A general announcement of proposed offering may be
published by written document only, provided that the general
announcement of proposed offering sets forth the following required
information:
   (i) The name of the issuer of the securities.
   (ii) The full title of the security to be issued.
   (iii) The anticipated suitability standards for prospective
purchasers.
   (iv) A statement that (I) no money or other consideration is being
solicited or will be accepted, (II) an indication of interest made
by a prospective purchaser involves no obligation or commitment of
any kind, and, if the issuer is required by paragraph (4) to deliver
a disclosure statement to prospective purchasers, (III) no sales will
be made or commitment to purchase accepted until five business days
after delivery of a disclosure statement and subscription information
to the prospective purchaser in accordance with the requirements of
this subdivision.
   (v) Any other information required by rule of the commissioner.
   (vi) The following legend:  "For more complete information about
(Name of Issuer) and (Full Title of Security), send for additional
information from (Name and Address) by sending this coupon or calling
(Telephone Number)."
   (B) The general announcement of proposed offering referred to in
subparagraph (A) may also set forth the following information:
   (i) A brief description of the business of the issuer.
   (ii) The geographic location of the issuer and its business.
   (iii) The price of the security to be issued, or, if the price is
not known, the method of its determination or the probable price
range as specified by the issuer, and the aggregate offering price.
   (C) The general announcement of proposed offering shall contain
only the information that is set forth in this paragraph.
   (D) Dissemination of the general announcement of proposed offering
to persons who are not qualified purchasers, without more, shall not
disqualify the issuer from claiming the exemption under this
subdivision.
   (6) No telephone solicitation shall be permitted until the issuer
has determined that the prospective purchaser to be solicited is a
qualified purchaser.
   (7) The issuer files a notice of transaction under this
subdivision both (A) concurrent with the publication of a general
announcement of proposed offering or at the time of the initial offer
of the securities, whichever occurs first, accompanied by a filing
fee, and (B) within 10 business days following the close or
abandonment of the offering, but in no case more than 210 days from
the date of filing the first notice.  The first notice of transaction
under subparagraph (A) shall contain an undertaking, in a form
acceptable to the commissioner, to deliver any disclosure statement
required by paragraph (4) to be delivered to prospective purchasers,
and any supplement thereto, to the commissioner within 10 days of the
commissioner's request for the information.  The exemption from
qualification afforded by this subdivision is unavailable if an
issuer fails to file the first notice required under subparagraph (A)
or to pay the filing fee.  The commissioner has the authority to
assess an administrative penalty of up to one thousand dollars
($1,000) against an issuer that fails to deliver the disclosure
statement required to be delivered to the commissioner upon the
commissioner's request within the time period set forth above.
Neither the filing of the disclosure statement nor the failure by the
commissioner to comment thereon precludes the commissioner from
taking any action deemed necessary or appropriate under this division
with respect to the offer and sale of the securities.
   (o) An offer or sale of any security issued by a corporation or
limited liability company pursuant to a purchase plan or agreement,
or issued pursuant to an option plan or agreement, where the security
at the time of issuance or grant is exempt from registration under
the Securities Act of 1933, as amended, pursuant to Rule 701 adopted
pursuant to that act (17 C.F.R.  230.701), the provisions of which
are hereby incorporated by reference into this section, provided that
(1) the terms of any purchase plan or agreement shall comply with
Sections 260.140.42, 260.140.45, and 260.140.46 of Title 10 of the
California Code of Regulations, (2) the terms of any option plan or
agreement shall comply with Sections 260.140.41, 260.140.45, and
260.140.46 of Title 10 of the California Code of Regulations, and (3)
the issuer files a notice of transaction in accordance with rules
adopted by the commissioner no later than 30 days after the initial
issuance of any security under that plan, accompanied by a filing fee
as prescribed by subdivision (y) of Section 25608.
   Offers and sales exempt pursuant to this subdivision shall be
deemed to be part of a single, discrete offering and are not subject
to integration with any other offering or sale, whether qualified
under Chapter 2 (commencing with Section 25110), or otherwise exempt,
or not subject to qualification.
   (p) An offer or sale of nonredeemable securities to accredited
investors (Section 28031) by a person licensed under the Capital
Access Company Law (Division 3 (commencing with Section 28000) of
Title 4).  All nonredeemable securities shall be evidenced by
certificates that shall have stamped or printed prominently on their
face a legend in a form to be prescribed by rule or order of the
commissioner restricting transfer of the securities in the manner as
the rule or order provides.
   (q) Any offer or sale of any viatical or life settlement contract
or fractionalized or pooled interest therein in a transaction that
meets all of the following criteria:
   (1) Sales of securities described in this subdivision are made
only to qualified purchasers or other persons the issuer reasonably
believes, after reasonable inquiry, to be qualified purchasers.  A
corporation, partnership, or other organization specifically formed
for the purpose of acquiring the securities offered by the issuer in
reliance upon this exemption may be a qualified purchaser only if
each of the equity owners of the corporation, partnership, or other
organization is a qualified purchaser.  Qualified purchasers include
the following:
   (A) A person designated in Section 260.102.13 of Title 10 of the
California Code of Regulations.
   (B) A person designated in subdivision (i) or any rule of the
commissioner adopted thereunder.
   (C) A pension or profit-sharing trust of the issuer, a
self-employed individual retirement plan, or an individual retirement
account, if the investment decisions made on behalf of the trust,
plan, or account are made solely by persons who are qualified
purchasers.
   (D) An organization described in Section 501(c)(3) of the Internal
Revenue Code, corporation, Massachusetts or similar business trust,
or partnership, each with total assets in excess of five million
dollars ($5,000,000) according to its most recent audited financial
statements.
   (E) A natural person who, either individually or jointly with the
person's spouse, (i) has a minimum net worth of one hundred fifty
thousand dollars ($150,000) and had, during the immediately preceding
tax year, gross income in excess of one hundred thousand dollars
($100,000) and reasonably expects gross income in excess of one
hundred thousand dollars ($100,000) during the current tax year or
(ii) has a minimum net worth of two hundred fifty thousand dollars
($250,000).  "Net worth" shall be determined exclusive of home, home
furnishings, and automobiles.  Other assets included in the
computation of net worth may be valued at fair market value.
   Each natural person specified above, by reason of his or her
business or financial experience, or the business or financial
experience of his or her professional advisor, who is unaffiliated
with and who is not compensated, directly or indirectly, by the
issuer or any affiliate or selling agent of the issuer, can be
reasonably assumed to have the capacity to protect his or her
interests in connection with the transaction.
   The amount of the investment of each natural person shall not
exceed 10 percent of the net worth, as determined by this
subdivision, of that natural person.
   (F) Any other purchaser designated as qualified by rule of the
commissioner.
   (2) Each purchaser represents that the purchaser is purchasing for
the purchaser's own account (or trust account, if the purchaser is a
trustee) and not with a view to or for sale in connection with a
distribution of the security.
   (3) Each natural person purchaser, including a corporation,
partnership, or other organization specifically formed by natural
persons for the purpose of acquiring the securities offered by the
issuer, receives, at least five business days before securities
described in this subdivision are sold to, or a commitment to
purchase is accepted from, the purchaser, the following information
in writing:
   (A) The name, principal business and mailing address, and
telephone number of the issuer.
   (B) The suitability standards for prospective purchasers as set
forth in paragraph (1) of this subdivision.
   (C) A description of the issuer's type of business organization
and the state in which the issuer is organized or incorporated.
   (D) A brief description of the business of the issuer.
   (E) If the issuer retains ownership or becomes the beneficiary of
the insurance policy, an audit report of an independent certified
public accountant together with a balance sheet and related
statements of income, retained earnings, and cash-flows that reflect
the issuer's financial position, the results of the issuer's
operations, and the issuer's cash-flows as of a date within 15 months
before the date of the initial issuance of the securities described
in this subdivision.  The financial statements listed in this
subparagraph shall be prepared in conformity with generally accepted
accounting principles.  If the date of the audit report is more than
120 days before the date of the initial issuance of the securities
described in this subdivision, the issuer shall provide unaudited
interim financial statements.
   (F) The names of all directors, officers, partners, members, or
trustees of the issuer.
   (G) A description of any order, judgment, or decree that is final
as to the issuing entity of any state, federal, or foreign country
governmental agency or administrator, or of any state, federal, or
foreign country court of competent jurisdiction (i) revoking,
suspending, denying, or censuring for cause any license, permit, or
other authority of the issuer or of any director, officer, partner,
member, trustee, or person owning or controlling, directly or
indirectly, 10 percent or more of the outstanding interest or equity
securities of the issuer, to engage in the securities, commodities,
franchise, insurance, real estate, or lending business or in the
offer or sale of securities, commodities, franchises, insurance, real
estate, or loans, (ii) permanently restraining, enjoining, barring,
suspending, or censuring any such person from engaging in or
continuing any conduct, practice, or employment in connection with
the offer or sale of securities, commodities, franchises, insurance,
real estate, or loans, (iii) convicting any such person of, or
pleading nolo contendere by any such person to, any felony or
misdemeanor involving a security, commodity, franchise, insurance,
real estate, or loan, or any aspect of the securities, commodities,
franchise, insurance, real estate, or lending business, or involving
dishonesty, fraud, deceit, embezzlement, fraudulent conversion, or
misappropriation of property, or (iv) holding any such person liable
in a civil action involving breach of a fiduciary duty, fraud,
deceit, embezzlement, fraudulent conversion, or misappropriation of
property.  This subparagraph does not apply to any order, judgment,
or decree that has been vacated, overturned, or is more than 10 years
old.
   (H) Notice of the purchaser's right to rescind or cancel the
investment and receive a refund pursuant to Section 25508.5.
   (I) The name, address, and telephone number of the issuing
insurance company, and the name, address, and telephone number of the
state or foreign country regulator of the insurance company.
   (J) The total face value of the insurance policy and the
percentage of the insurance policy the purchaser will own.
   (K) The insurance policy number, issue date, and type.
   (L) If a group insurance policy, the name, address, and telephone
number of the group, and, if applicable, the material terms and
conditions of converting the policy to an individual policy,
including the amount of increased premiums.
   (M) If a term insurance policy, the term and the name, address,
and telephone number of the person who will be responsible for
renewing the policy if necessary.
   (N) That the insurance policy is beyond the state statute for
contestability and the reason therefor.
   (O) The insurance policy premiums and terms of premium payments.
   (P) The amount of the purchaser's moneys that will be set aside to
pay premiums.
   (Q) The name, address, and telephone number of the person who will
be the insurance policy owner and the person who will be responsible
for paying premiums.
   (R) The date on which the purchaser will be required to pay
premiums and the amount of the premium, if known.
   (S) A statement to the effect that any projected rate of return to
the purchaser from the purchase of a viatical or life settlement
contract or a fractionalized or pooled interest therein is based on
an estimated life expectancy for the person insured under the life
insurance policy; that the return on the purchase may vary
substantially from the expected rate of return based upon the actual
life expectancy of the insured that may be less than, equal to, or
may greatly exceed the estimated life expectancy; and that the rate
of return would be higher if the actual life expectancy were less
than, and lower if the actual life expectancy were greater than the
estimated life expectancy of the insured at the time the viatical or
life settlement contract was closed.
   (T) A statement that the purchaser should consult with his or her
tax advisor regarding the tax consequences of the purchase of the
viatical or life settlement contract or fractionalized or pooled
interest therein and, if the purchaser is using retirement funds or
accounts for that purchase, whether or not any adverse tax
consequences might result from the use of those funds for the
purchase of that investment.
   (U) Any other information as may be prescribed by rule of the
commissioner.
  SEC. 48.  Section 25103 of the Corporations Code is amended to
read:
   25103.  The following transactions are exempted from the
provisions of Section 25110 and Section 25120:
   (a) Any negotiations or agreements prior to general solicitation
of approval by the holders of equity securities, and subject to that
approval, of (1) a change in the rights, preferences, privileges, or
restrictions of or on outstanding securities, (2) a merger,
consolidation, or sale of assets in consideration of the issuance of
securities, or (3) an entity conversion transaction.
   (b) Any change in the rights, preferences, privileges, or
restrictions of or on outstanding securities or any entity conversion
transaction, unless the holders of at least 25 percent of the
outstanding shares or units of any class of securities that will be
directly or indirectly affected substantially and adversely by that
change or transaction have addresses in this state according to the
records of the issuer.
   (c) Any exchange incident to a merger, consolidation, or sale of
assets in consideration of the issuance of securities of another
issuer, unless at least 25 percent of the outstanding securities of
any class, any holders of which are to receive securities in the
exchange, are held by persons who have addresses in this state
according to the records of the issuer of which they are holders.
This exemption is not available for a rollup transaction as defined
by Section 25014.6.  The exemption is also not available for a
transaction excluded from the definition of rollup transaction by
virtue of paragraph (5) or (6) of subdivision (b) of Section 25014.6
if the transaction is one of a series of transactions that directly
or indirectly through acquisition or otherwise involves the
combination or reorganization of one or more rollup participants.
   (d) For the purposes of subdivision (b) and subdivision (c) of
this section, (1) any securities held to the knowledge of the issuer
in the names of broker-dealers or nominees of broker-dealers and (2)
any securities controlled by any one person who controls directly or
indirectly 50 percent or more of the outstanding securities of that
class shall not be considered outstanding.  The determination of
whether 25 percent of the outstanding securities are held by persons
having addresses in this state, for the purposes of subdivision (b)
and subdivision (c) of this section, shall be made as of the record
date for the determination of the security holders entitled to vote
on or consent to the action, if approval of those holders is
required, or, if not, as of the date of directors' approval of that
action.
   (e) Any change (other than a stock split or reverse stock split)
in the rights, preferences, privileges, or restrictions of or on
outstanding equity securities, except the following if they
materially and adversely affect any class of equity securities:  (1)
to add, change, or delete assessment provisions; (2) to change the
rights to dividends thereon; (3) to change the redemption provisions;
(4) to make them redeemable; (5) to change the amount payable on
liquidation; (6) to change, add, or delete conversion rights; (7) to
change, add, or delete voting rights; (8) to change, add, or delete
preemptive rights; (9) to change, add, or delete sinking fund
provisions; (10) to rearrange the relative priorities of outstanding
equity securities; (11) to impose, change, or delete restrictions
upon the transfer of equity securities in the organizational
documents for the entity; (12) to change the right of holders of
equity securities with respect to the calling of special meetings of
holders of equity securities; and (13) to change, add, or delete any
rights, preferences, privileges, or restrictions of, or on, the
outstanding shares or memberships of a mutual water company or other
corporation or entity organized primarily to provide services or
facilities to its shareholders or members.  Changes in the rights,
preferences, privileges, or restrictions of or on outstanding equity
securities do not materially and adversely affect any class of
holders of equity securities within the meaning of this subdivision
if they arise from (i) the addition to articles of incorporation of
the provisions described or referred to in subdivision (a) of Section
158 upon the conversion of an existing corporation to a close
corporation pursuant to subdivision (b) of Section 158, (ii) the
deletion from the articles of incorporation of the provisions
described or referred to in subdivision (a) of Section 158 upon the
voluntary termination of close corporation status pursuant to
subdivisions (c) and (e) of Section 158, (iii) the involuntary
cessation of close corporation status pursuant to subdivision (e) of
Section 158, or (iv) the termination of a shareholders' agreement
pursuant to subdivision (b) of Section 300.
   (f) Any stock split or reverse stock split, except the following:
(1) any stock split or reverse stock split if the corporation has
more than one class of shares outstanding and the split would have a
material effect on the proportionate interests of the respective
classes as to voting, dividends, or distributions; (2) any stock
split of a stock that is traded in the market and its market price as
of the date of directors' approval of the stock split adjusted to
give effect to the split was less than two dollars ($2) per share;
and (3) any reverse stock split if the corporation has the option of
paying cash for any fractional shares created by the reverse split
and as a result of that action the proportionate interests of the
shareholders would be substantially altered.  Any shares issued upon
a stock split or reverse stock split exempted by this subdivision
shall be subject to any conditions previously imposed by the
commissioner applicable to the shares with respect to which they are
issued.
   (g) Any change in the rights of outstanding debt securities,
except the following if they substantially and adversely affect any
class of securities:  (1) to change the rights to interest thereon;
(2) to change their redemption provisions; (3) to make them
redeemable; (4) to extend the maturity thereof or to change the
amount payable thereon at maturity; (5) to change their voting
rights; (6) to change their conversion rights; (7) to change sinking
fund provisions; and (8) to make them subordinate to other
indebtedness.
   (h) Any exchange incident to a merger, consolidation, or sale of
assets, other than a rollup transaction (as defined in Section
25014.6), in consideration
   of the issuance of equity securities of another entity or any
entity conversion transaction that meets the following conditions:
   (1) The exchange incident to a merger, consolidation, or sale of
assets or the entity conversion transaction, had the exchange
transaction involved the issuance of a security in a transaction
subject to the provisions of Section 25110, would have been exempt
from qualification by subdivision (f) of Section 25102, without
giving effect to  paragraph (3) thereof, and either of the following
is applicable:
   (A) (i) Not less than 75 percent of the outstanding equity
securities of each constituent or converting entity entitled to vote
on the proposed transaction voted in favor of the transaction, (ii)
not more than 10 percent of the outstanding equity securities of each
constituent or converting entity entitled to vote on the proposed
transaction voted against the transaction, and (iii) each constituent
or converting entity whose security holders are entitled to vote on
the proposed transaction is subject to a state statute that has
provisions for dissenters' rights for holders of equity securities
entitled to vote on the proposed transaction that do not vote in
favor of or voted against the transaction.
   (B) (i) The transaction is solely for the purposes of changing the
issuer's state of incorporation or organization, or form of
organization, (ii) all the securities of the same class or series,
unless all the security holders of the class or series consent, are
treated equally, and (iii) the holders of nonredeemable voting equity
securities receive nonredeemable voting equity securities.
   (2) The commissioner may, by rule, require the acquiring or
surviving entity to file a notice of transaction under this section.
However, the failure to file the notice or the failure to file the
notice within the time specified by the rule of the commissioner
shall not affect the availability of this exemption.  An acquiring or
surviving entity that fails to file the notice as provided by rule
of the commissioner shall, within 15 business days after demand by
the commissioner, file the notice and pay to the commissioner a fee
equal to the fee payable had the transaction been qualified under
Section 25110 or 25120.
   (i) Any exchange of securities in connection with any merger or
consolidation or sale of corporate assets in consideration wholly or
in part of the issuance of securities or any entity conversion
transaction under, or pursuant to, a plan of reorganization or
arrangement that pursuant to the provisions of the United States
Bankruptcy Code (Title 11 of the United States Code) has been
confirmed or is subject to confirmation by the decree or order of a
court of competent jurisdiction.
  SEC. 49.  Section 25120 of the Corporations Code is amended to
read:
   25120.  It is unlawful for any person to offer or sell in this
state any security (a) in an issuer transaction in connection with
any change in the rights, preferences, privileges, or restrictions of
or on outstanding securities, (b) in any exchange of securities by
the issuer with its existing security holders exclusively, (c) in any
exchange in connection with any merger or consolidation or purchase
of assets in consideration wholly or in part of the issuance of
securities, or (d) in an entity conversion transaction, unless the
security is qualified for sale under this chapter (and no order under
Section 25140 or subdivision (a) of Section 25143 is in effect with
respect to the qualification) or unless the security or transaction
is exempted or not subject to qualification under Chapter 1
(commencing with Section 25100) of this part.
  SEC. 50.  Section 313 of the Education Code is amended to read:
   313.  (a) Each school district that has one or more pupils who are
English learners shall assess each pupil's English language
development in order to determine the level of proficiency for the
purposes of this chapter.
   (b) The State Department of Education, with the approval of the
State Board of Education, shall establish procedures for conducting
the assessment required pursuant to subdivision (a) and for the
reclassification of a pupil from English learner to proficient in
English.
   (c) Commencing with the 2000-01 school year, the assessment shall
be conducted upon initial enrollment, and annually, thereafter,
during a period of time determined by the Superintendent of Public
Instruction and the State Board of Education.  The annual assessments
shall continue until the pupil is redesignated as English
proficient.  The assessment shall primarily utilize the English
language development test identified or developed by the
Superintendent of Public Instruction pursuant to Chapter 7
(commencing with Section 60810) of Part 33.  Prior to completion of
the English language development test, a school district shall use
either an assessment instrument developed by the school district or
an assessment recommended by the State Department of Education.
   (d) The reclassification procedures developed by the State
Department of Education shall utilize multiple criteria in
determining whether to reclassify a pupil as proficient in English,
including, but not limited to, all of the following:
   (1) Assessment of language proficiency using an objective
assessment instrument, including, but not limited to, the English
language development test pursuant to Section 60810.
   (2) Teacher evaluation, including, but not limited to, a review of
the pupil's curriculum mastery.
   (3) Parental opinion and consultation.
   (4) Comparison of the pupil's performance in basic skills against
an empirically established range of performance in basic skills based
upon the performance of English proficient pupils of the same age,
that demonstrates whether the pupil is sufficiently proficient in
English to participate effectively in a curriculum designed for
pupils of the same age whose native language is English.
   (e) It is the intent of the Legislature that nothing in this
section preclude a school district or county office of education from
testing English language learners more than once in a school year if
the school district or county office of education chooses to do so.

  SEC. 51.  Section 406 of the Education Code is amended to read:
   406.  (a) The Regents of the University of California are
requested to authorize the President of the University of California
or his or her designee to jointly develop English Language
Development Professional Institutes with the Chancellor of the
California State University, the Chancellor of the California
Community Colleges, the independent colleges and universities, and
the Superintendent of Public Instruction, or their designees.  In
order to provide maximum access, the institutes shall be offered at
sites widely distributed throughout the state, which shall include
programs offered through instructor-led, interactive online courses,
in accordance with existing state law.  In order to maximize access
to teachers and administrators who may be precluded from
participating in an onsite institute due to geographical, physical,
or time constraints, each institute shall accommodate at least 5
percent of the participants through existing state approved online
instructor-led courses, programs, or both.  The California subject
matter projects, an intersegmental, discipline-based professional
development network administered by the University of California, is
requested to be the organizing entity for the institutes and followup
programs.
   (b) (1) Commencing in the 1999-2000 academic year, the institutes
shall provide instruction for school teams from each school
participating in the program established pursuant to this chapter.
Commencing in the 2000-01 academic year, the institutes may provide
instruction for school teams serving English language learners in
kindergarten and grades 1 to 12, inclusive.  A school team shall
include teachers who do not hold crosscultural or
bilingual-crosscultural certificates or their equivalents, teachers
who hold those certificates or their equivalents, and a schoolsite
administrator. The majority of the team shall be teachers who do not
hold those crosscultural certificates or their equivalents.  If the
participating school team employs instructional assistants who
provide instructional services to English language learners, the team
may include these instructional assistants.
   (2) Commencing in July 2000, the English Language Development
Institutes shall provide instruction to an additional 10,000
participants.  These participants shall be in addition to the 5,000
participants authorized as of January 1, 2000.  Commencing July 2001,
and each fiscal year thereafter, the number of participants
receiving instruction through the English Language Development
Institutes shall be specified in the annual Budget Act.
   (3) Criteria and priority for selection of participating school
teams shall include, but not necessarily be limited to, all of the
following:
   (A) Schools whose pupils' reading scores are at or below the 40th
percentile on the English language arts portion of the achievement
test authorized by Section 60640.
   (B) Schools in which a high percentage of pupils score below grade
level on the English language development assessment authorized by
Section 60810, when it is developed.
   (C) Schools with a high number of new, underprepared, and
noncredentialed teachers.  Underprepared teachers shall be defined as
teachers who do not possess a crosscultural or
bilingual-crosscultural certificate, or their equivalents.
   (D) Schools in which the enrollment of English language learners
exceeds 25 percent of the total school enrollment.
   (E) Schools with a full complement of team members as described in
paragraph (1).
   (4) In any fiscal year, if funding is inadequate to accommodate
the participation of all eligible school teams, first priority shall
be given to schools meeting the criteria set forth in subparagraph
(C) of paragraph (3).
   (c) Each team member who satisfactorily completes an institute
authorized by this section shall receive a stipend, commensurate with
the duration of the institute, of not less than one thousand dollars
($1,000) nor more than two thousand dollars ($2,000), as determined
by the University of California.
   (d) Instruction provided by the institutes shall be consistent
with state-adopted academic content standards and with the English
language development standards adopted pursuant to Section 60811.
   (e) (1) Instruction at the institutes shall consist of an
intensive, sustained training period of no less than 40 hours nor
more than 80 hours during the summer or during an intersession break
or an equivalent instructor-led, online course and shall be
supplemented during the following school year with no fewer than 80
hours nor more than 120 hours of instruction and schoolsite meetings,
held on at least a monthly basis, to focus on the academic progress
of English language learners at that school.
   (2) Instruction at the institutes shall be of sufficient scope,
depth, and duration to fully equip instructional personnel to offer a
comprehensive and rigorous instructional program for English
language learners and to assess pupil progress so these pupils can
meet the academic content and performance standards adopted by the
State Board of Education.  The instruction shall be designed to
increase the capacity of teachers and other school personnel to
provide and assess standards-based instruction for English language
learners.
   (3) The instruction shall be multidisciplinary and focus on
instruction in disciplines for which the State Board of Education has
adopted academic content standards.  The instruction shall also be
research-based and provide effective models of professional
development in order to ensure that instructional personnel increase
their skills, at a minimum, in all of the following:
   (A) Literacy instruction and assessment for diverse pupil
populations, including instruction in the teaching of reading that is
research-based and consistent with the balanced, comprehensive
strategies required under Section 44757.
   (B) English language development and second language acquisition
strategies.
   (C) Specially designed instruction and assessment in English.
   (D) Application of appropriate assessment instruments to assess
language proficiency and utilization of benchmarks for
reclassification of pupils from English language learners to fully
English proficient.
   (E) Examination of pupil work as a basis for the alignment of
standards, instruction, and assessment.
   (F) Use of appropriate instructional materials to assist English
language learners to attain academic content standards.
   (G) Instructional technology and its integration into the school
curriculum for English language learners.
   (H) Parent involvement and effective practices for building
partnerships with parents.
   (f) It is the intent of the Legislature that a local educational
agency or postsecondary institution that offers an accredited program
of professional preparation consider providing partial and
proportional credit toward satisfaction of the course requirements to
an enrolled candidate who satisfactorily completes a California
English Language Development Institute program if the program has
been certified by the Commission on Teacher Credentialing as meeting
preparation standards.
   (g) Nothing in this section shall be construed to prohibit a team
member from attending an institute authorized by this section in more
than one academic year.
   (h) This section shall not apply to the University of California
unless and until the Regents of the University of California act, by
resolution, to make it applicable.
  SEC. 52.  Section 426 of the Education Code is amended to read:
   426.  (a) The State Librarian, with input from the Legislative
Analyst's office, the office of the Secretary for Education, and the
Department of Finance, shall contract with an independent evaluator
to evaluate the portion of the English Language and Intensive
Literacy Program that is administered by the State Library, as listed
in Item 6120-212-0001 of Section 2.00 of the Budget Act of 2000.
The evaluation shall determine the effectiveness of this program,
including, but not limited to, improving English language proficiency
and identifying the most effective practices for teaching English
language learners and their families in improving English language
proficiency.
   (b) The State Librarian shall provide interim reports to the
Legislature that include, but are not limited to, the following:
   (1) The amount of funding allocated.
   (2) The number of libraries or schools participating in the
program.
   (3) The number of English language learners participating in this
program.
   (4) The number of parents participating in the program.
   (c) The first report is due March 1, 2001.  The second report is
due March 1, 2002.  The final interim report is due March 1, 2003.
However, these reports shall be required only if funds are available
for allocation for this program.
  SEC. 53.  Section 427 of the Education Code is amended to read:
   427.  (a) It is the intent of the Legislature that data developed
through the English Language and Intensive Literacy Program be used
to inform curriculum, instruction, assessment, research, and teacher
preparation programs regarding use of the most effective practices
for teaching English language learners.
   (b) It is the intent of the Legislature that, once the most
effective programs and processes have been identified, schools be
required to incorporate those effective practices into the regular
classroom instruction as a condition of receiving funds pursuant to
Section 404.
   (c) It is further the intent of the Legislature that this program
be administered consistent with research-based strategies for
teaching English language learners, as well as Chapter 3 (commencing
with Section 300), as applicable.
  SEC. 54.  Section 11700 of the Education Code is amended to read:
   11700.  (a) It is the intent of the Legislature that the Center
for International Education Synergy be established through a joint
powers agreement, entered into pursuant to Chapter 5 (commencing with
Section 6500) of Division 7 of Title 1 of the Government Code,
between the Sweetwater Union High School District, the Southwestern
Community College District, and San Diego State University.  It is
the intent of the Legislature that a joint powers agency created
pursuant to the joint powers agreement own and maintain the land and
facilities for the Center for International Education Synergy at the
Otay Mesa Off-Campus Center.
   (b) In addition to funding appropriated by the Legislature for
purposes of the Center for International Education Synergy, entities
participating in the establishment and operation of the center are
encouraged to seek supplemental funding, including, but not limited
to, funding from foundations, corporations, and other public
entities.
   (c) Any postsecondary education facilities and programs developed
pursuant to this section shall be subject to the requirements of
Section 66903 as they apply to the governing boards of public
postsecondary educational institutes.
   (d) The Center for International Education Synergy shall be
established only upon approval by the California Postsecondary
Education Commission based on a needs study and subsequent approval
from the Department of Finance.
  SEC. 55.  Section 17071.46 of the Education Code is amended to
read:
   17071.46.  (a) When an applicant school district proposes to
demolish a single story building and replace it with a multistory
building on the same site, the State Allocation Board shall provide a
supplemental grant for 50 percent of the replacement cost of the
single story building to be demolished, if all of the following
conditions are met:
   (1) The school at which the building demolition and replacement is
to occur is operating on a multitrack year-round education schedule.

   (2) The cost of the demolition and replacement is less than the
total cost of providing a new school facility, including land, on a
new site for the additional number of pupils housed as a result of
the replacement building, as determined by the State Allocation
Board.
   (3) The school district will maximize the increase in pupil
capacity on the site when it builds the replacement building, subject
to the limits imposed on it pursuant to paragraph (4).
   (4) The State Department of Education has determined that the
demolition of an existing single story building and replacement with
a multistory building at the site is the best available alternative
and will not create a school with an inappropriate number of pupils
in relation to the size of the site, as determined by the State
Department of Education.
   (b) The State Allocation Board shall establish additional
requirements it deems necessary to ensure that the economic interests
of the state and the educational interests of the children of the
state are protected.
  SEC. 56.  Section 17210 of the Education Code is amended to read:
   17210.  As used in this article, the following terms have the
following meanings:
   (a) "Administering agency" means any agency designated pursuant to
Section 25502 of the Health and Safety Code.
   (b) "Environmental assessor" means a class II environmental
assessor registered by the Office of Environmental Health Hazard
Assessment pursuant to Chapter 6.98 (commencing with Section 25570)
of Division 20 of the Health and Safety Code, a professional engineer
registered in this state, a geologist registered in this state, a
certified engineering geologist registered in this state, or a
licensed hazardous substance contractor certified pursuant to Chapter
9 (commencing with Section 7000) of Division 3 of the Business and
Professions Code.  A licensed hazardous substance contractor shall
hold the equivalent of a degree from an accredited public or private
college or university or from a private postsecondary educational
institution approved by the Bureau for Private Postsecondary and
Vocational Education with at least 60 units in environmental,
biological, chemical, physical, or soil science; engineering;
geology; environmental or public health; or a directly related
science field.  In addition, any person who conducts phase I
environmental assessments shall have at least two years' experience
in the preparation of those assessments and any person who conducts a
preliminary endangerment assessment shall have at least three years'
experience in conducting those assessments.
   (c) "Handle" has the meaning the term is given in Article 1
(commencing with Section 25500) of Chapter 6.95 of Division 20 of the
Health and Safety Code.
   (d) "Hazardous air emissions" means emissions into the ambient air
of air contaminants that have been identified as a toxic air
contaminant by the State Air Resources Board or by the air pollution
control officer for the jurisdiction in which the project is located.
  As determined by the air pollution control officer, hazardous air
emissions also means emissions into the ambient air from any
substance identified in subdivisions (a) to (f), inclusive, of
Section 44321 of the Health and Safety Code.
   (e) "Hazardous material" has the meaning the term is given in
subdivision (d) of Section 25260 of the Health and Safety Code.
   (f) "Operation and maintenance," "removal action work plan,"
"respond," "response," "response action," and "site" have the
meanings those terms are given in Article 2 (commencing with Section
25310) of the state act.
   (g) "Phase I environmental assessment" means a preliminary
assessment of a property to determine whether there has been or may
have been a release of a hazardous material, or whether a naturally
occurring hazardous material is present, based on reasonably
available information about the property and the area in its
vicinity.  A phase I environmental assessment may include, but is not
limited to, a review of public and private records of current and
historical land uses, prior releases of a hazardous material, data
base searches, review of relevant files of federal, state, and local
agencies, visual and other surveys of the property, review of
historical aerial photographs of the property and the area in its
vicinity, interviews with current and previous owners and operators,
and review of regulatory correspondence and environmental reports.
Sampling or testing is not required as part of the phase I
environmental assessment.  A phase I environmental assessment
conducted pursuant to the requirements adopted by the American
Society for Testing and Materials for due diligence for commercial
real estate transactions and that includes a review of all reasonably
available records and data bases regarding current and prior gas or
oil wells and naturally occurring hazardous materials located on the
site or located where they could potentially effect the site,
satisfies the requirements of this article for conducting a phase I
environmental assessment unless and until the Department of Toxic
Substances Control adopts final regulations that establish guidelines
for a phase I environmental assessment for purposes of schoolsites
that impose different requirements from those imposed by the American
Society for Testing and Materials.
   (h) "Preliminary endangerment assessment" means an activity that
is performed to determine whether current or past hazardous material
management practices or waste management practices have resulted in a
release or threatened release of hazardous materials, or whether
naturally occurring hazardous materials are present, which pose a
threat to children's health, children's learning abilities, public
health or the environment.  A preliminary endangerment assessment
requires sampling and analysis of a site, a preliminary determination
of the type and extent of hazardous material contamination of the
site, and a preliminary evaluation of the risks that the hazardous
material contamination of a site may pose to children's health,
public health, or the environment, and shall be conducted in a manner
that complies with the guidelines published by the Department of
Toxic Substances Control entitled "Preliminary Endangerment
Assessment:  Guidance Manual," including any amendments that are
determined by the Department of Toxic Substances Control to be
appropriate to address issues that are unique to schoolsites.
   (i) "Proposed schoolsite" means real property acquired or to be
acquired or proposed for use as a schoolsite, prior to its occupancy
as a school.
   (j) "Regulated substance" means any material defined in
subdivision (g) of Section 25532 of the Health and Safety Code.
   (k) "Release" has the same meaning the term is given in Article 2
(commencing with Section 25310) of Chapter 6.8 of Division 20 of the
Health and Safety Code, and includes a release described in
subdivision (d) of Section 25321 of the Health and Safety Code.
   (l) "Remedial action plan" means a plan approved by the Department
of Toxic Substances Control pursuant to Section 25356.1 of the
Health and Safety Code.
   (m) "State act" means the Carpenter-Presley-Tanner Hazardous
Substance Account Act (Chapter 6.8 (commencing with Section 25300) of
Division 20 of the Health and Safety Code).
  SEC. 57.  Section 17317 of the Education Code is amended to read:
   17317.  (a) The Department of General Services shall, in
consultation with the Seismic Safety Commission, conduct an inventory
of public school buildings that are concrete tilt-up school
buildings and school buildings with nonwood frame walls that do not
meet the minimum requirements of the 1976 Uniform Building Code.
Priority shall be given to the school buildings identified in the act
that added this section that are in the highest seismic risk zones
in accordance with the seismic hazard maps of the Division of Mines
and Geology of the Department of Conservation.
   (b) The Department of General Services shall submit a report by
December 31, 2001, to the Legislature and the Governor that
summarizes the findings of the seismic safety inventory and makes
recommendations about future actions that should be taken to address
the problems found by the seismic safety inventory.  The report shall
not identify individual schoolsites on which inventoried school
buildings are located.
  SEC. 58.  Section 17610.5 of the Education Code is amended to read:

   17610.5.  Sections 17611 and 17612 shall not apply to a pesticide
product deployed in the form of a self-contained bait or trap, to gel
or paste                                           deployed as a
crack and crevice treatment, to any pesticide exempted from
regulation by the United States Environmental Protection Agency
pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act
(7 U.S.C. Sec.  136 et seq.), or to antimicrobial pesticides,
including sanitizers and disinfectants.
  SEC. 59.  Section 22660 of the Education Code is amended to read:
   22660.  (a) The nonmember spouse who is awarded a separate account
under this part shall have the right to designate, pursuant to
Sections 23300 to 23304, inclusive, a beneficiary or beneficiaries to
receive the accumulated retirement contributions under the Defined
Benefit Program and to designate a payee to receive the accumulated
Defined Benefit Supplement account balance under the Defined Benefit
Supplement Program remaining in the separate account of the nonmember
spouse on his or her date of death, and any accrued allowance or
accrued benefit under the Defined Benefit Supplement Program that is
attributable to the separate account of the nonmember spouse and that
is unpaid on the date of the death of the nonmember spouse.
   (b) This section shall not be construed to provide the nonmember
spouse with any right to elect to modify a retirement allowance under
Section 24300 or to elect a joint and survivor annuity under the
Defined Benefit Supplement Program.
  SEC. 60.  Section 22950 of the Education Code is amended to read:
   22950.  (a) Employers shall contribute monthly to the system 8
percent of the creditable compensation upon which members'
contributions under this part are based.
   (b) From the contributions required under subdivision (a), there
shall be deposited in the Teachers' Retirement Fund an amount,
determined by the board, that is not less than the amount, determined
in an actuarial valuation of the Defined Benefit Program pursuant to
Section 22311.5, necessary to finance the liabilities associated
with the benefits of the Defined Benefit Program over the funding
period adopted by the board, after taking into account the
contributions made pursuant to Sections 22901, 22951, and 22955.
   (c) The amount of contributions required under subdivision (a)
that is not deposited in the Teachers' Retirement Fund pursuant to
subdivision (b) shall be deposited directly into the Teachers' Health
Benefits Fund, as established in Section 25930, and shall not be
deposited into or transferred from the Teachers' Retirement Fund.
  SEC. 61.  Section 25933 of the Education Code is amended to read:
   25933.  (a) For purposes of this section, "plan" means any health
benefits program that is financed from the proceeds of the fund.
   (b) The board shall maintain all data necessary to perform an
actuarial investigation of the demographic and economic experience of
the plan and for the actuarial valuation of the assets and
liabilities of the plan.
   (c) The board shall retain the services of an actuary to do all of
the following:
   (1) Make recommendations to the board for the adoption of
actuarial assumptions that, in the aggregate, are reasonably related
to the past experience of the plan and reflect the actuary's informed
estimate of future experience.
   (2) Make an actuarial investigation of the demographic and
economic experience, including the mortality, service, and other
experience, of the plan with respect to members or any other persons
eligible to receive benefits from the plan.
   (3) At least biennially, using actuarial assumptions adopted by
the board, perform an actuarial valuation of the plan that identifies
the assets and liabilities of the plan, and report the findings to
the board.  The report of the actuary on the results of the actuarial
valuation shall identify and include the components of normal cost
and adequate information to determine the effects of changes in
actuarial assumptions.  Copies of the report on the actuarial
valuation shall be transmitted to the Governor and to the
Legislature.
   (4) Recommend to the board all rates and factors necessary to
administer the plan, including, but not limited to, mortality tables
and interest rates.
   (5) Recommend to the board a strategy for amortizing any unfunded
actuarial obligation.
  SEC. 62.  Section 33126.1 of the Education Code is amended to read:

   33126.1.  (a) The State Department of Education shall develop and
recommend for adoption by the State Board of Education a standardized
template intended to simplify the process for completing the school
accountability report card and make the school accountability report
card more meaningful to the public.
   (b) The standardized template shall include fields for the
insertion of data and information by the State Department of
Education and by local educational agencies.  When the template for a
school is completed, it should enable parents and guardians to
compare how local schools compare to other schools within that
district as well as other schools in the state.
   (c) In conjunction with the development of the standardized
template, the State Department of Education shall furnish standard
definitions for school conditions included in the school
accountability report card.  The standard definitions shall comply
with the following:
   (1) Definitions shall be consistent with the definitions already
in place or under the development at the state level pursuant to
existing law.
   (2) Definitions shall enable schools to furnish contextual or
comparative information to assist the public in understanding the
information in relation to the performance of other schools.
   (3) Definitions shall specify the data for which the State
Department of Education will be responsible for providing and the
data and information for which the local educational agencies will be
responsible.
   (d) By December 1, 2000, the State Department of Education shall
report to the State Board of Education on the school conditions for
which it already has standard definitions in place or under
development.  The report shall include a survey of the conditions for
which the State Department of Education has valid and reliable data
at the state, district, or school level.  The report shall provide a
timetable for the inclusion of conditions for which standard
definitions or valid and reliable data do not yet exist through the
State Department of Education.
   (e) By December 1, 2000, the Superintendent of Public Instruction
shall recommend and the State Board of Education shall appoint 13
members to serve on a broad-based advisory committee of local
administrators, educators, parents, and other knowledgeable parties
to develop definitions for the school conditions for which standard
definitions do not yet exist.  The State Board of Education may
designate outside experts in performance measurements in support of
activities of the advisory board.
   (f) By January 1, 2001, the State Board of Education shall approve
available definitions for inclusion in the template as well as a
timetable for the further development of definitions and data
collection procedures.  By July 1, 2001, and each year thereafter,
the State Board of Education shall adopt the template for the current
year's school accountability report card.  Definitions for all
school conditions shall be included in the template by July 1, 2002.

   (g) The State Department of Education shall annually post the
completed and viewable template on the Internet.  The template shall
be designed to allow schools or districts to download the template
from the Internet.  The template shall further be designed to allow
local educational agencies, including individual schools, to enter
data into the school accountability report card electronically,
individualize the report card, and further describe the data
elements.  The State Department of Education shall establish model
guidelines and safeguards that may be used by school districts
secured access only for those school officials authorized to make
modifications.
   (h) The State Department of Education shall maintain current
Internet links with the Web sites of local educational agencies to
provide parents and the public with easy access to the school
accountability report cards maintained on the Internet.  In order to
ensure the currency of these Internet links, local educational
agencies that provide access to school accountability report cards
through the Internet shall furnish current Uniform Resource Locators
for their Web sites to the State Department of Education.
   (i) A school or school district that chooses not to utilize the
standardized template adopted pursuant to this section shall report
the data for its school accountability report card in a manner that
is consistent with the definitions adopted pursuant to subdivision
(c) of this section.
   (j) The State Department of Education shall provide
recommendations for changes to the California Basic Education Data
System, or any successor data system, and other data collection
mechanisms to ensure that the information will be preserved and
available in the future.
   (k) Local educational agencies shall make these school
accountability report cards available through the Internet or through
paper copies.
   (l) The State Department of Education shall monitor the compliance
of local educational agencies with the requirements to prepare and
to distribute school accountability report cards.
  SEC. 63.  Section 37252 of the Education Code is amended to read:
   37252.  (a) The governing board of each district maintaining any
or all of grades 7 to 12, inclusive, shall offer, and a charter
school may offer, supplemental instructional programs for pupils
enrolled in grades 7 to 12, inclusive, who do not demonstrate
sufficient progress toward passing the exit examination required for
high school graduation pursuant to Chapter 8 (commencing with Section
60850) of Part 33.
   (b) Sufficient progress, as described in subdivision (a), shall be
determined on the basis of either of the following:
   (1) The results of the assessments administered pursuant to
Article 4 (commencing with Section 60640) of Chapter 5 of Part 33 and
the minimum levels of proficiency recommended by the State Board of
Education pursuant to Section 60648.
   (2) The pupils' grades and other indicators of academic
achievement designated by the district.
   (c) For purposes of this section, a pupil shall be considered to
be enrolled in a grade immediately upon completion of the preceding
grade.  Supplemental instruction may also be offered to a pupil who
was enrolled in grade 12 during the prior school year.
   (d) For the purposes of this section, pupils who do not possess
sufficient English language skills to be assessed, as set forth in
Sections 60850 and 60853, shall be considered pupils who do not
demonstrate sufficient progress towards passing the exit examination
required for high school graduation and shall receive supplemental
instruction designed to assist pupils to succeed on the high school
exit examination.
   (e) Instructional programs may be offered pursuant to this section
during the summer, before school, after school, on Saturday, or
during intersession, or in any combination of summer, before school,
after school, Saturday, or intersession instruction, but shall be in
addition to the regular schoolday.  Any minor pupil whose parent or
guardian informs the school district that the pupil is unable to
attend a Saturday school program for religious reasons, or any pupil
18 years of age or older who states that he or she is unable to
attend a Saturday school program for religious reasons, shall be
given priority for enrollment in supplemental instruction offered at
a time other than Saturday over a pupil who is not unable to attend a
Saturday school program for religious reasons.
   (f) A school district or charter school offering supplemental
instructional programs pursuant to this section shall receive funding
as described in Section 42239 and in the annual Budget Act.
   (g) Notwithstanding any other provision of law, neither the State
Board of Education nor the Superintendent of Public Instruction may
waive any provision of this section.
  SEC. 64.  Section 37252.2 of the Education Code is amended to read:

   37252.2.  (a) The governing board of each school district
maintaining any or all of grades 2 to 9, inclusive, shall offer, and
a charter school may offer, programs of direct, systematic, and
intensive supplemental instruction to pupils enrolled in grades 2 to
9, inclusive, who have been recommended for retention or who have
been retained pursuant to Section 48070.5.  A school district or
charter school may require a pupil who has been retained to
participate in supplemental instructional programs.  Notwithstanding
the requirements of this section, the school district or charter
school shall provide a mechanism for a parent or guardian to decline
to enroll his or her child in the program.  Attendance in
supplemental instructional programs shall not be compulsory within
the meaning of Section 48200.
   (b) Supplemental educational services pursuant to subdivision (a)
may be offered during the summer, before school, after school, on
Saturdays, or during intersession, or in a combination of summer
school, before school, after school, Saturday, or intersession
instruction.  Services shall not be provided during the pupil's
regular instructional day. Any minor pupil whose parent or guardian
informs the school district that the pupil is unable to attend a
Saturday school program for religious reasons, or any pupil 18 years
of age or older who states that he or she is unable to attend a
Saturday school program for religious reasons, shall be given
priority for enrollment in supplemental instruction offered at a time
other than Saturday, over a pupil who is not unable to attend a
Saturday school program for religious reasons.
   (c) For purposes of this section, a pupil shall be considered to
be enrolled in a grade immediately upon completion of the preceding
grade.  Summer school instruction may also be offered to pupils who
were enrolled in grade 6 during the prior school year.  For ninth
grade pupils identified in subdivision (a), summer school instruction
may also be offered to pupils who were enrolled in grade 9 during
the prior school year.
   (d) Each school district or charter school shall use results from
tests administered under the Standardized Testing and Reporting
Program, established pursuant to Article 4 (commencing with Section
60640) of Chapter 5 of Part 33 or other evaluative criteria to
identify eligible pupils pursuant to subdivision (b).
   (e) An intensive remedial program in reading or written expression
offered pursuant to this section shall, as needed, include
instruction in phoneme awareness, systematic explicit phonics and
decoding, word attack skills, spelling and vocabulary, explicit
instruction of reading comprehension, writing, and study skills.
   (f) Each school district or charter school shall seek the active
involvement of parents and classroom teachers in the development and
implementation of supplemental instructional programs provided
pursuant to this section.
   (g) It is the intent of the Legislature that pupils who are at
risk of failing to meet state adopted standards, or who are at risk
of retention, be identified as early in the school year and as early
in their school careers as possible, and be provided the opportunity
for supplemental instruction sufficient to assist them in attaining
expected levels of academic achievement.
   (h) Notwithstanding any other provision of law, neither the State
Board of Education nor the Superintendent of Public Instruction may
waive any provision of this section.
   (i) This section shall become operative on January 1, 2003.
  SEC. 65.  Section 37619 of the Education Code is amended to read:
   37619.  Each selected school shall be closed for all students and
employees on regular school holidays specified in Article 3
(commencing with Section 37220) of Chapter 2.
  SEC. 66.  Section 41329.1 of the Education Code is amended to read:

   41329.1.  (a) The County Office Fiscal Crisis and Management
Assistance Team shall conduct comprehensive assessments and shall
complete, by July 1, 2001, the following improvement plans for the
West Contra Costa Unified School District:
   (1) An instructional improvement plan that includes special
education and programs for English language learners and is
consistent with the financial improvement plan required by paragraph
(2).  The plan shall specify pupil outcomes that reflect significant
improvement in pupil achievement, particularly in the areas of
reading, writing, and mathematics.  Among the areas addressed by the
plan shall be the alignment between the written, taught, and tested
curriculum consistent with the state's adopted instructional
standards.  Included in the plan shall be a clear link between
professional development for all instructional staff consistent with
pupil achievement objectives.
   (2) A financial improvement plan that is consistent with the
instructional improvement plan required by paragraph (1) and that
includes the current and future projected solvency and fiscal
integrity of the school district.  The financial improvement plan
shall also include, but not be limited to, specific strategies for
developing a loan repayment plan to fully extinguish the balance on
state loans provided to the district and for improving the following:

   (A) Management information systems.
   (B) Accounting and internal control procedures.
   (C) Attendance accounting procedures.
   (3) A facilities improvement plan that shall be consistent with
the financial improvement plan required by paragraph (2) and that
includes, but is not limited to, specific strategies for improving
the following:
   (A) Protection and safety for pupils, employees, and district
property.
   (B) Ongoing maintenance of district property.
   (C) Management control and procedures for managing all
construction and modernization projects.
   (4) A personnel management improvement plan that is consistent
with the financial improvement plan required by paragraph (2) and
that includes, but is not limited to, specific strategies for
improving the following:
   (A) The recruitment, retention, screening, assessment, and hiring
procedures for all district staff.
   (B) The training of members of the governing board of the school
district in the subjects about which members of the governing board
must have knowledge in order to discharge their duties as board
members effectively.
   (C) The assessment of the administrative practices of the school
district and staff development to ensure that staff have the
knowledge and skills required to manage effectively the educational
programs, finances, safety, and facilities maintenance of the school
district.
   (D) The calculation and maintenance of appropriate and efficient
full-time equivalent staffing ratios for all school district staff.
   (E) The governance structure of the school district in relation to
board policy development, operational effectiveness, and
responsiveness to the community.
   (5) A community relations improvement plan that is consistent with
the financial improvement plan required by paragraph (2) and that
includes, but is not limited to, specific strategies for improving
the communication among the governing board, personnel of the school
district, pupils, and parents.
   (b) Beginning on December 1, 2001, and each six months thereafter
until July 1, 2003, the County Office Fiscal Crisis and Management
Assistance Team shall file a written status report with the
appropriate fiscal and policy committees of the Legislature,
including any special committees created for the purpose of reviewing
the reports, and with the governing board of the school district,
the Superintendent of Public Instruction, the Director of Finance,
and the Secretary for Education.  The reports shall include the
progress that the West Contra Costa Unified School District is making
in meeting the recommendations of the improvement plans developed
pursuant to subdivision (a).
   (c) The County Office Fiscal Crisis and Management Assistance Team
shall provide to the Controller an accounting of expenditures made
by it pursuant to the requirements of this act.
  (d) This section shall remain in effect only until January 1, 2004,
and as of that date is repealed, unless a later enacted statute,
that is enacted before January 1, 2004, deletes or extends that date.

  SEC. 67.  Section 42239 of the Education Code is amended to read:
   42239.  For the 2000-01 fiscal year, and each fiscal year
thereafter, the Superintendent of Public Instruction shall compute
funding for supplemental instruction for each school district or
charter school in the following manner:
   (a) Multiply the number of pupil hours of supplemental instruction
claimed pursuant to Sections 37252, 37252.2, and 37252.5 by the
pupil hour allowance specified in subdivision (c) or by a pupil hour
allowance specified in the annual Budget Act in lieu of the amount
computed in subdivision (c).
   (b) Multiply the number of pupil hours of supplemental instruction
claimed pursuant to Sections 37252.6, 37252.8, and 37253 by the
pupil hour allowance specified in subdivision (c) or by a per-pupil
hour allowance specified in the annual Budget Act in lieu of the
amount computed in subdivision (c).  The total number of pupil hours
of supplemental instruction that may be claimed pursuant to Section
37253 may not exceed the limits on pupil hours that may be claimed as
established by subdivisions (c) and (d) of Section 37253.  The total
number of pupil hours of supplemental instruction that may be
claimed pursuant to Section 37252.6 may not exceed the limits on
pupil hours that may be claimed as established in subdivision (g) of
that section.
   (c) Commencing with the 2000-01 fiscal year, hours of supplemental
instruction shall be reimbursed at a rate of three dollars and 25
cents ($3.25) per pupil hour, adjusted in future years as specified
in this section, provided that a different reimbursement rate may be
specified for each fiscal year in the annual Budget Act that
appropriates funding for that fiscal year.  This amount shall be
increased annually by the percentage increase pursuant to subdivision
(b) of Section 42238.1 granted to school districts or charter
schools for base revenue limit cost-of-living increases.
   (d) (1) If appropriated funding is insufficient to pay all claims
made in any fiscal year pursuant to Section 37252, 37252.2, or
37252.5, the superintendent shall use any available funding
appropriated for the purposes of reimbursing school districts
pursuant to Section 37252, 37252.2, 37252.5, or subdivision (d) of
Section 37253.
   (2) If appropriated funding is still insufficient to pay all
claims made in any fiscal year pursuant to Section 37252, 37252.2, or
37252.5, the superintendent shall use any available funding
appropriated for the purposes of reimbursing school districts for
supplemental instruction in the prior fiscal year.
   (3) If appropriated funding is still insufficient to pay all
claims made in any fiscal year pursuant to Section 37252, 37252.2, or
37252.5, the superintendent shall use any available funding
appropriated for the purposes of reimbursing school districts for
supplemental instruction in the current fiscal year.
   (4) The superintendent shall notify the Director of Finance that
there is a deficiency of funding appropriated for the purposes of
Sections 37252, 37252.2, and 37252.5 only after the superintendent
has exhausted all available balances of appropriations made for the
current or prior fiscal years for the reimbursement of school
districts for supplemental instruction.
   (e) Notwithstanding any other provision of law, neither the State
Board of Education nor the Superintendent of Public Instruction may
waive any provision of this section.
  SEC. 68.  Section 44114 of the Education Code is amended to read:
   44114.  (a) A public school employee or applicant for employment
with a public school employer who files a written complaint with his
or her supervisor, a school administrator, or the public school
employer alleging actual or attempted acts of reprisal, retaliation,
threats, coercion, or similar improper acts prohibited by Section
44113 for having disclosed improper governmental activities or for
refusing to obey an illegal order may also file a copy of the written
complaint  with the local law enforcement agency together with a
sworn statement that the contents of the written complaint are true,
or are believed by the affiant to be true, under penalty of perjury.
The complaint filed with the local law enforcement agency shall be
filed within 12 months of the most recent act of reprisal that is the
subject of the complaint.
   (b) A person who intentionally engages in acts of reprisal,
retaliation, threats, coercion, or similar acts against a public
school employee or applicant for employment with a public school
employer for having made a protected disclosure is subject to a fine
not to exceed ten thousand dollars ($10,000) and imprisonment in the
county jail for a period not to exceed one year.  Any public school
employee, officer, or administrator who intentionally engages in that
conduct shall also be subject to discipline by the public school
employer.  If no adverse action is instituted by the public school
employer and it is determined that there is reasonable cause to
believe that an act of reprisal, retaliation, threats, coercion, or
similar acts prohibited by Section 44113 occurred, the local law
enforcement agency may report the nature and details of the activity
to the governing board of the school district or county board of
education, as appropriate.
   (c) In addition to all other penalties provided by law, a person
who intentionally engages in acts of reprisal, retaliation, threats,
coercion, or similar acts against a public school employee or
applicant for employment with a public school employer for having
made a protected disclosure shall be liable in an action for damages
brought against him or her by the injured party.  Punitive damages
may be awarded by the court where the acts of the offending party are
proven to be malicious.  Where liability has been established, the
injured party shall also be entitled to reasonable attorney's fees as
provided by law.  However, an action for damages shall not be
available to the injured party unless the injured party has first
filed a complaint with the local law enforcement agency.

         (d) This section is not intended to prevent a public school
employer, school administrator, or supervisor from taking, failing to
take, directing others to take, recommending, or approving a
personnel action with respect to a public school employee or
applicant for employment with a public school employer if the public
school employer, school administrator, or supervisor reasonably
believes the action or inaction is justified on the basis of evidence
separate and apart from the fact that the person has made a
protected disclosure as defined in subdivision (e) of Section 44112.

   (e) In any civil action or administrative proceeding, once it has
been demonstrated by a preponderance of evidence that an activity
protected by this article was a contributing factor in the alleged
retaliation against a former, current, or prospective public school
employee, the burden of proof shall be on the supervisor, school
administrator, or public school employer to demonstrate by clear and
convincing evidence that the alleged action would have occurred for
legitimate, independent reasons even if the public school employee
had not engaged in protected disclosures or refused an illegal order.
  If the supervisor, school administrator, or public school employer
fails to meet this burden of proof in an adverse action against the
public school employee in any administrative review, challenge, or
adjudication in which retaliation has been demonstrated to be a
contributing factor, the public school employee shall have a complete
affirmative defense in the adverse action.
   (f) Nothing in this article shall be deemed to diminish the
rights, privileges, or remedies of a public school employee under any
other federal or state law or under an employment contract or
collective bargaining agreement.
   (g) If the provisions of this section are in conflict with the
provisions of a memorandum of understanding reached pursuant to
Chapter 10.7 (commencing with Section 3540) of Division 4 of Title 1
of the Government Code, the memorandum of understanding shall be
controlling without further legislative action.
  SEC. 69.  Section 45005.25 of the Education Code is amended and
renumbered to read:
   48005.25.  (a) Notwithstanding any provision of law to the
contrary, including, but not limited to, Section 48000, for the
2001-02 school year, and each school year thereafter in which a
school district continues to participate in the program, the school
district shall offer admission to kindergarten at the beginning of
the school year, or at a later time in the same school year, only to
children who will have their fifth birthday on or before September 1
of that school year.
   (b) Notwithstanding any provision of law to the contrary,
including, but not limited to, Section 48010, for the 2001-02 school
year, and each school year thereafter in which a school district
continues to participate in the program, a school district shall
offer admission to first grade at the beginning of the school year,
or at a later time in the same school year, only to children who will
have their sixth birthday on or before September 1 of that school
year.  Kindergarten shall not be a prerequisite for enrollment in
first grade pursuant to this article.
   (c) Notwithstanding subdivisions (a) and (b), the governing board
of each school district participating in this program shall adopt a
policy to allow, for good cause, admission of a child to kindergarten
or to the first grade at the beginning of a school year in which the
child's birthday will be after September 1, or at a later time in
the same school year.
  SEC. 70.  Section 45005.30 of the Education Code is amended and
renumbered to read:
   48005.30.  (a) For the 2001-02 school year the Superintendent of
Public Instruction shall allocate a grant of funds for a
participating school district as follows:
   (1) A grant provided for each year of participation to cover the
costs of developing and operating the school district kindergarten
readiness program, including, but not limited to, the costs of
administration and the costs associated with services provided to
parents and children in the program.  For any participating school
district, annual funding pursuant to this paragraph shall not exceed
the per-pupil amounts set forth in subparagraph (A) or (B) multiplied
by a number equal to 50 percent of the entire annual kindergarten
enrollment of the school district:
   (A) Five hundred dollars ($500) for every child participating in
the kindergarten readiness program for 110 hours.
   (B) Seven hundred fifty dollars ($750) for every child
participating in the kindergarten readiness program for 150 or more
hours.
   (2) Funding necessary to fully mitigate the financial impact upon
the school district of the reduced attendance that results from the
program, to be determined as follows:
   (A) Multiply one-fourth of the kindergarten average daily
attendance for the 2000-01 school year by the school district's base
revenue limit per unit of average daily attendance.
   (B) From the 2000-01 school year funded average daily attendance
subtract the 2001-02 school year funded average daily attendance for
the participating school district's base revenue limit.  If the
difference is zero or less, the result of this calculation shall be
zero.  If the difference is greater than zero, multiply the
difference by the district's base revenue limit per unit of average
daily attendance.
   (C) From the product of subparagraph (A) subtract the result of
subparagraph (B).  If the result of subparagraph (B) is greater than
the product of subparagraph (A), then this calculation shall be zero.

   (b) For the 2002-03 school year, and each school year thereafter
in which the school district participates in the program up to and
including the 2007-08 school year, the Superintendent of Public
Instruction shall allocate a grant of funds for a participating
school district as follows:
   (1) A grant provided for each year of participation to cover the
costs of developing and operating the school district kindergarten
readiness program, including, but not limited to, the costs of
administration and the costs associated with services provided to
parents and children in the program.  For any participating school
district, annual funding pursuant to this paragraph shall not exceed
the per-pupil amounts set forth in subparagraph (A) or (B) multiplied
by a number equal to 50 percent of the entire annual kindergarten
enrollment of the school district:
   (A) Five hundred dollars ($500) for every child participating in
the kindergarten readiness program for 110 hours.
   (B) Seven hundred fifty dollars ($750) for every child
participating in the kindergarten readiness program for 150 or more
hours.
   (2) Funding necessary to fully mitigate the financial impact upon
the school district of the reduced attendance that results from the
program to be calculated by multiplying one-fourth of the
kindergarten average daily attendance for the 2000-01 school year, by
the school district's base revenue limit per unit of average daily
attendance, adjusted annually for cost of living as provided
generally for school district base revenue limits.
   (c) In addition to providing funding for costs associated with
current annual operation of the program as set forth in subdivisions
(a) and (b), it is the intent of the Legislature to establish a
mechanism to provide sufficient funding in future years to ensure
that participant school districts are annually provided funding to
fully mitigate any ongoing financial consequences from reduced
enrollment due to participation in the program for every school year
up to and including the 2013-14 school year.
   (d) (1) Total annual funding for mitigation of lost revenues due
to reduced enrollment provided pursuant to this article shall be
subject to a statewide annual maximum funding level equal to the
equivalent of 2,300 full annual units of average daily attendance.
   (2) It is the intent of the Legislature that the annual funding
mechanism to be provided for subsequent school years as described in
subdivision (c) be subject to a similar maximum statewide level of
funding as set forth in paragraph (1).
  SEC. 71.  Section 45023.1 of the Education Code is amended to read:

   45023.1.  (a) Commencing with the 2000-01 fiscal year, the
governing board of a school district, the county superintendent of
schools, or the county board of education may increase, for teachers
meeting the requirements prescribed by this section, the salary on
its adopted certificated employee salary schedule as provided in
subdivision (b).  For purposes of this section, any teacher for whom
the governing board, county superintendent of schools, or county
board of education may increase salaries shall meet all of the
following criteria:
   (1) Hold a valid California teaching credential, not including an
emergency permit, intern certificate or credential, or waiver.
   (2) Possess a baccalaureate or higher degree.
   (3) Receive a salary paid through the general fund of the district
or county office.
   (b) The governing board, county superintendent of schools, or
county board of education that increases its salaries pursuant to
subdivision (a) shall perform the following computations:
   (1) The governing board, county superintendent of schools, or
county board of education shall designate as the lowest salary on the
salary schedule for a certificated employee meeting the criteria in
subdivision (a) an amount that is at least an annual salary of
thirty-four thousand dollars ($34,000) in the 2000-01 fiscal year.
   (2) The governing board, county superintendent of schools, or
county board of education shall increase to the annual salary amount
in paragraph (1) the salary of any certificated employee meeting the
criteria in subdivision (a) whose salary on the salary schedule for
the 1999-2000 fiscal year was less than the amount computed in
paragraph (1) and, notwithstanding Section 45028, shall incorporate
that increase into the salary schedule commencing with the 2000-01
fiscal year.
   (c) Each school district or county office of education that
increases its beginning teacher annual minimum salary to thirty-four
thousand dollars ($34,000) pursuant to subdivision (b) shall elect,
except as provided in subdivision (j), to receive reimbursement for
the cost of the increase pursuant to only one of the following two
options:
   (1) Option One:
   (A) In fiscal year 2000-01, a school district, county
superintendent of schools, or county office of education that
increases salaries pursuant to paragraph (2) of subdivision (b) and
selects reimbursement Option One shall receive an amount equal to six
dollars ($6) times the district's or county office's second
principal apportionment average daily attendance for the 1999-2000
fiscal year, excluding attendance in adult education programs and
charter schools participating in the charter school block grant
pursuant to Article 2 (commencing with Section 47633) of Chapter 6 of
Part 26.8.
   (B) Divide the amount received from the state pursuant to
subparagraph (A) for the 2000-01 fiscal year by the school district
or county office of education second principal apportionment average
daily attendance for the 1999-2000 fiscal year, excluding attendance
in adult education programs and charter schools participating in the
charter school block grant pursuant to Article 2 (commencing with
Section 47633) of Chapter 6 of Part 26.8.
   (C) For the 2001-02 fiscal year and each fiscal year thereafter,
for each school district that increases its salaries pursuant to
subdivision (a), the Superintendent of Public Instruction shall sum
the results of paragraphs (i) and (ii) and add that figure to the
total school district revenue limit computed pursuant to Section
42238:
   (i) Annually increase the funding rate per unit of average daily
attendance specified in subparagraph (B) by the percentage increase
pursuant to subdivision (b) of Section 42238.1 and multiply the
resulting product by the school district's second principal
apportionment average daily attendance for the current fiscal year
excluding attendance in regional occupational centers/programs, adult
education programs, and charter schools participating in the charter
school block grant pursuant to Article 2 (commencing with Section
47633) of Chapter 6 of Part 26.8.
   (ii) Annually increase the funding rate per unit of average daily
attendance specified in subparagraph (B) by the percentage increase
pursuant to subdivision (b) of Section 42238.1 and multiply the
resulting product by the school district's second principal
apportionment average daily attendance for the current fiscal year in
regional occupational centers/programs excluding attendance in
charter schools participating in the charter school block grant
pursuant to Article 2 (commencing with Section 47633) of Chapter 6 of
Part 26.8.
   (D) For the 2001-02 fiscal year and each fiscal year thereafter,
for each county office of education that increases its salaries
pursuant to subdivision (a), the Superintendent of Public Instruction
shall add the sum of paragraphs (i) and (ii) to the county office of
education revenue limit computed pursuant to Section 2550:
   (i) Annually increase the funding rate per unit of average daily
attendance specified in subparagraph (B) by the percentage increase
identified pursuant to Section 2557 and multiply the resulting
product by the county office of education's second principal
apportionment average daily attendance for the current fiscal year
excluding attendance in regional occupational centers/programs, adult
education programs, and charter schools participating in the charter
school block grant pursuant to Article 2 (commencing with Section
47633) of Chapter 6 of Part 26.8.
   (ii) Annually increase the funding rate per unit of average daily
attendance specified in subparagraph (B) by the percentage increase
identified pursuant to Section 2557 and multiply the resulting
product by the county office of education's second principal
apportionment average daily attendance for the current fiscal year in
regional occupational centers/programs excluding attendance in
charter schools participating in the charter school block grant
pursuant to Article 2 (commencing with Section 47633) of Chapter 6 of
Part 26.8.
   (E) The school district, county superintendent of schools, or
county office of education shall utilize these incentive funds not
only to meet the new beginning teacher annual minimum salary of
thirty-four thousand dollars ($34,000), but may also use the funds to
generally enhance teachers' salaries in order to achieve the goals
of retention of qualified, competent, and experienced teachers and
the attainment of a reasonable salary commensurate with a teacher's
experience, education, and responsibilities.
   (2) Option Two:  A school district, county superintendent of
schools, or county office of education may submit a request to the
Superintendent of Public Instruction, on a form supplied by the
Superintendent of Public Instruction, for state funding computed as
follows:
   (A) Total the salaries of all certificated employees receiving
increased salaries up to a maximum of thirty-four thousand dollars
($34,000) per person pursuant to subdivision (b) for the 2000-01
fiscal year.
   (B) Total all salaries, based on the salary schedule for the
2000-01 fiscal year before the increase made pursuant to subdivision
(b), of all certificated employees receiving increased salaries
pursuant to subdivision (b).
   (C) Subtract the amount in subparagraph (B) from the amount in
subparagraph (A).
   (D) Multiply the amount in subparagraph (C) by the district's
statutory benefit rates.
   (E) For the 2000-01 fiscal year, a school district, county
superintendent of schools, or county office of education that
increases salaries pursuant to paragraph (2) of subdivision (b) and
selects reimbursement Option Two shall receive the sum of
subparagraphs (C) and (D).
   (F) Divide the sum of the amounts received pursuant to
subparagraphs (C) and (D) for the 2000-01 fiscal year by the school
district and county office of education average daily attendance for
the second principal apportionment for the 2000-01 fiscal year,
excluding attendance in adult education programs and charter schools
participating in the charter school block grant pursuant to Article 2
(commencing with Section 47633) of Chapter 6 of Part 26.8.
   (G) For the 2001-02 fiscal year and each fiscal year thereafter,
for each school district that increases its salaries pursuant to
subdivision (a), the Superintendent of Public Instruction shall sum
the results of paragraphs (i) and (ii) and add that figure to the
total school district revenue limit computed pursuant to Section
42238:
   (i) Annually increase the funding rate per unit of average daily
attendance calculated pursuant to subparagraph (F) by the percentage
increase pursuant to subdivision (b) of Section 42238.1 and multiply
the resulting product by the school district's second principal
apportionment average daily attendance for the current fiscal year
excluding attendance in regional occupational centers/programs, adult
education programs, and charter schools participating in the charter
school block grant pursuant to Article 2 (commencing with Section
47633) of Chapter 6 of Part 26.8.
   (ii) Annually increase the funding rate per unit of average daily
attendance calculated pursuant to subparagraph (F) by the percentage
increase pursuant to subdivision (b) of Section 42238.1 and multiply
the resulting product by the school district's second principal
apportionment average daily attendance for the current fiscal year in
regional occupational centers/programs excluding attendance in
charter schools participating in the charter school block grant
pursuant to Article 2 (commencing with Section 47633) of Chapter 6 of
Part 26.8.
   (H) For the 2001-02 fiscal year and each fiscal year thereafter,
for each county office of education that increases its salaries
pursuant to subdivision (a), the Superintendent of Public Instruction
shall add the sum of paragraphs (i) and (ii) to the county office of
education revenue limit computed pursuant to Section 2550:
   (i) Annually increase the funding rate per unit of average daily
attendance calculated pursuant to subparagraph (F) by the percentage
increase identified pursuant to Section 2557 and multiply the
resulting product by the county office of education's second
principal apportionment average daily attendance for the current
fiscal year excluding attendance in regional occupational
centers/programs, adult education programs, and charter schools
participating in the charter school block grant pursuant to Article 2
(commencing with Section 47633) of Chapter 6 of Part 26.8.
   (ii) Annually increase the funding rate per unit of average daily
attendance calculated pursuant to subparagraph (F) by the percentage
increase identified pursuant to Section 2557 and multiply the
resulting product by the county office of education's second
principal apportionment average daily attendance for the current
fiscal year in regional occupational centers/programs excluding
attendance in charter schools participating in the charter school
block grant pursuant to Article 2 (commencing with Section 47633) of
Chapter 6 of Part 26.8.
   (d) Any state funds received pursuant to this section and not used
pursuant to the conditions of this section shall be returned to the
state.
   (e) If the funds requested by school districts, county
superintendents of schools, and county offices of education for the
2000-01 fiscal year exceed the state appropriation for this section,
the Superintendent of Public Instruction shall reduce all requests by
the application of a single, common percentage factor for
apportionment purposes, so as not to exceed the amount appropriated
for this purpose.
   (f) A school district or county office of education shall receive
reimbursement pursuant to subdivision (c) only.  However, this
section does not prohibit a school district and its employees from
negotiating salary schedules.
   (g) The adjustments to school district and county office of
education revenue limits prescribed in subparagraphs (C) and (D) of
paragraph (1) of subdivision (c) and subparagraphs (G) and (H) of
paragraph (2) of subdivision (c), respectively, shall continue so
long as the increase in the salary schedule made pursuant to
paragraph (2) of subdivision (b) or subdivision (i) is maintained.
   (h) The Superintendent of Public Instruction shall issue
appropriate forms to school districts and county offices of education
no later than September 1, 2000.  School districts, county
superintendents of schools, or county offices of education shall
notify the Superintendent of Public Instruction no later than
December 31, 2000, regarding which option they wish to exercise for
the 2000-01 fiscal year.  School districts, county superintendents of
schools, or county offices of education shall file their claim form
for state funds with the Superintendent of Public Instruction no
later than March 1, 2001.
   (i) Adjustments made to school district or county office of
education revenue limits pursuant to subparagraphs (C) and (D) of
paragraph (1) of subdivision (c) and subparagraphs (G) and (H) of
paragraph (2) of subdivision (c), respectively, shall not be
considered part of the base revenue limit for the purpose of
computing equalization adjustments or determining other
wealth-related differences in school funding.
   (j) Notwithstanding subdivision (c), a school district or county
office of education that already has as the annual minimum salary for
beginning teachers who meet the criteria in subdivision (a) in an
amount equal to or greater than thirty-four thousand dollars
($34,000) shall be eligible to receive reimbursement pursuant to
Option One.
  SEC. 72.  Section 48664 of the Education Code is amended to read:
   48664.  (a) (1) In addition to funds from all other sources, the
Superintendent of Public Instruction shall apportion to each school
district that operates a community day school four thousand dollars
($4,000) per year, and for each county office of education that
operates a community day school three thousand dollars ($3,000) per
year, for each unit of average daily attendance reported at the
annual apportionment for pupil attendance at community day schools,
adjusted annually commencing with the 1999-2000 fiscal year for the
inflation adjustment calculated pursuant to subdivision (b) of
Section 42238.1.  Average daily attendance reported for this program
shall not exceed 0.375 percent of a district's prior year P2 average
daily attendance in an elementary school district, 0.5 percent of a
district's prior year P2 average daily attendance in a unified school
district, or 0.625 percent of a district's prior year P2 average
daily attendance in a high school district.  The units of average
daily attendance of a community day school operated by a county
office of education shall not exceed the unused units of average
daily attendance of the community day schools operated by the school
districts within the jurisdiction of that county office of education.

   (2) The Superintendent of Public Instruction may reallocate to any
school district any unexpended balance of the appropriations made
for the purposes of this subdivision for actual pupil attendance in
excess of the percentage specified in this subdivision for the school
district in an amount not to exceed one-half of that percentage.
However, the average daily attendance generated by pupils expelled
pursuant to subdivision (d) of Section 48915, shall not be subject to
these percentage caps on average daily attendance.
   (b) The average daily attendance of a community day school shall
be determined by dividing the total number of days of attendance in
all full school months, by a divisor of 70 in the first period of
each fiscal year, by a divisor of 135 in the second period of each
fiscal year, and by a divisor of 180 at the annual time of each
fiscal year.
   (c) The Superintendent of Public Instruction shall apportion to
each school district that operates a community day school an amount
equal to four dollars ($4), adjusted annually commencing with the
1999-2000 fiscal year for inflation pursuant to subdivision (b) of
Section 42238.1, multiplied by the total of the number of hours each
schoolday, up to a maximum of two hours daily, that each community
day school pupil remains at the community day school under the
supervision of an employee of the school district, or a consortium of
school districts pursuant to Section 48916.1, reporting the
attendance of the pupils for apportionment funding following
completion of the full six-hour instructional day.
   (d) It is the intent of the Legislature that districts enter into
consortia, as feasible, for the purpose of providing community day
school programs.  Any school district with fewer than 2,501 units of
average daily attendance may request a waiver for any fiscal year of
the funding limitations set forth in this section.  The
Superintendent of Public Instruction shall approve a waiver if he or
she deems it necessary in order to permit the operation of a
community day school of reasonably comparable quality to those
offered in a school district with 2,501 or more units of average
daily attendance.  In no event shall the amount allocated pursuant to
a waiver exceed the amount provided for one teacher pursuant to
Section 42284, for pupils enrolled in kindergarten and grades 1 to 6,
inclusive, or the amount provided for one teacher pursuant to
Section 42284, for pupils enrolled in grades 7 to 12, inclusive.  The
provisions of this act shall not apply to any school district that
applied for a waiver within the funding limits established by this
subdivision but was denied funding or not fully funded.
   (e) The State Department of Education shall evaluate and report to
the appropriate legislative policy committees and budget committees
on or before October 1, 1998, and for two years thereafter the
following programmatic and fiscal issues:
   (1) The number of expulsions statewide.
   (2) The number of school districts operating community day
schools.
   (3) Status of the countywide plans as defined in Section 48926.
   (4) An evaluation of the community day school average daily
attendance funding percentage cap.
   (5) Number of small school districts requesting and the number
receiving a waiver under this section.
   (6) The effect of hourly accounting under Section 48663 for
purposes of receiving the additional funding under Section 48664.

     (7) The number of pupils and average daily attendance served in
community day programs, further identified as the number expelled
pursuant to subdivision (b) of Section 48915, subdivision (d) of
Section 48915, other expulsion criteria, or referred through a formal
district process.
   (8) Pupil outcome data and other data as required under Section
48916.1.
   (9) Other programmatic or fiscal matters as determined by the
State Department of Education.
   (f) The additional funds provided in subdivisions (a), (c), and
(d) shall only be allocated to the extent that funds are appropriated
for this purpose in the annual Budget Act or other legislation, or
both, except for pupils expelled pursuant to subdivision (d) of
Section 48915.  For pupils expelled pursuant to subdivision (d) of
Section 48915, the funds apportioned under subdivision (a) are
continuously appropriated from the General Fund to Section A of the
State School Fund.
   (g) A one-time adjustment shall be made to the amount specified in
subdivision (a), for the 1998-99 fiscal year and subsequent fiscal
years, by increasing that amount by the statewide average quotient
resulting from dividing the average daily attendance specified in
subparagraph (B) of paragraph (3) of subdivision (a) of Section
42238.8 by the amount specified in subparagraph (C) of paragraph (3)
of subdivision (a) of Section 42238.8.
  SEC. 73.  Section 52054 of the Education Code is amended to read:
   52054.  (a) By November 15 of the year that the school is selected
to participate, the governing board of a school district having
jurisdiction over a school selected for participation in the program
shall contract with an external evaluator from the list of external
evaluators and shall appoint a broad-based schoolsite and community
team, consisting of a majority of nonschoolsite personnel.  In a
school that has a limited-English-proficient pupil population that
constitutes at least 40 percent of the total pupil population, an
external evaluator shall have demonstrated experience in working with
a limited-English-proficient pupil population.  Not less than 20
percent of the members of the team shall be parents or legal
guardians of pupils in the school.
   (b) The selected external evaluator shall solicit input from the
parents and legal guardians of the pupils of the school.  At a
minimum, the evaluator shall do all of the following:
   (1) Inform the parents and legal guardians, in writing, that the
school has been selected to participate in the Immediate
Intervention/Underperforming Schools Program due to its below average
performance.
   (2) Hold a public meeting at the school, in cooperation with the
principal, to which all parents and legal guardians of pupils in the
school receive a written invitation.  The invitation to the meeting
may be combined with the written notice required by paragraph (1).
   (3) Solicit, at the public meeting, the recommendations and
opinions of the participating parents and legal guardians of pupils
in the school regarding actions that should be taken to improve the
performance of the school.  These opinions and recommendations shall
be considered by the external evaluator and the community team in the
development of the action plan pursuant to this section.
   (4) Notify all parents and legal guardians of pupils in the school
of their opportunity to provide written recommendations of actions
that should be taken to improve the performance of the school which
shall be considered by the external evaluator and the community team
in the development of the action plan pursuant to this section.
Notice required by this subdivision may be combined with the written
notice required by paragraph (1).
   (c) By February 15 of the school year in which the school is
selected to participate, the selected external evaluator, in
collaboration with the broad-based schoolsite and community team
selected pursuant to subdivision (a), shall complete a review of the
school that identifies weaknesses that contribute to the school's
below average performance, make recommendations for improvement, and
begin to develop an action plan to improve the academic performance
of the pupils enrolled at the school.  The action plan shall include
percentage growth targets at least as high as the annual growth
targets adopted by the State Board of Education pursuant to Section
52052.  The action plan shall include an expenditure plan and shall
be of a scope that does not require expenditure of funds in excess of
those provided pursuant to this article or otherwise available to
the school.  The action plan may not be of a scope that requires
reimbursement by the Commission on State Mandates for its
implementation.
   (d) At a minimum, the action plan shall do all of the following:
   (1) Review and include the school and district conditions
identified in the school accountability report card pursuant to
Section 33126.
   (2) Identify the current barriers at the school and district
toward improvements in pupil achievement.
   (3) Identify schoolwide and districtwide strategies to remove
these barriers.
   (4) Review and include school and school district crime
statistics, in accordance with Section 628.5 of the Penal Code.
   (5) Examine and consider disaggregated data regarding pupil
achievement and other indicators to consider whether all groups and
types of pupils make adequate progress toward short-term growth
targets and long-term performance goals.  The disaggregated data to
be included and considered by the plan shall, at a minimum, provide
information regarding the achievement of English language learners,
pupils with exceptional needs, pupils who qualify for free and
reduced price meals, and all pupils, by race, ethnicity, and gender.

   (6) Set short-term academic objectives pursuant to Section 52052
for a two-year period that will allow the school to make adequate
progress toward the growth targets established for each participating
school for pupil achievement as measured by all of the following to
the extent that the data is available for the school:
   (A) The achievement test administered pursuant to Section 60640.
   (B) Graduation rates for grades 7 to 12, inclusive.
   (C) Attendance rates for pupils and school personnel for
elementary, middle, and secondary schools.
   (D) Any other indicators approved by the State Board of Education.

   (e) The school action plan shall focus on improving pupil academic
performance, improving the involvement of parents and guardians,
improving the effective and efficient allocation of resources and
management of the school, and identifying and developing solutions
that take into account the underlying causes for low performance by
pupils.
   (f) The team, in the development of the action plan, shall consult
with the exclusive representatives of employee organizations, where
they exist.
   (g) The school action plan may propose to increase the number of
instructional days offered at the schoolsite and also may propose to
increase up to a full 12 months the amount of time for which
certificated employees are contracted, if all of the following
conditions are met:
   (1) Provisions of the plan proposed pursuant to this subdivision
do not violate current applicable collective bargaining agreements.
   (2) An agreement is reached with the exclusive representative
concerning staffing specifically to accommodate the extended school
year or 12-month contract.
   (h) The team, in the development of the action plan, shall consult
with the exclusive representatives of employee organizations, where
they exist.
   (i) Upon its completion, the action plan shall be submitted to the
governing board of the school districts for its approval.  After the
plan is approved, but no later than May 15 of the year that follows
the year the school is selected to participate, the plan shall be
submitted to the Superintendent of Public Instruction with a request
for funding in the form prescribed by the Superintendent of Public
Instruction, who shall review the school action plan and recommend
approval or disapproval of the school's request for funding to the
State Board of Education.
   (j) Not later than July 15 of the year next following the year in
which a school is selected for participation, the State Board of
Education shall review and approve or disapprove the school's request
for funding, based on the recommendation of the Superintendent of
Public Instruction.  Within thirty days of the State Board of
Education's review, the Superintendent of Public Instruction shall
notify the effected school districts of the state of the board's
action regarding the request for funding.  In conjunction with its
approval of a request for funding to implement a school's action
plan, the State Board of Education may, at the request of the
governing board of the school district or the county board of
education for a school under its jurisdiction, waive all or any part
of any provision of this code, or any regulation adopted by the State
Board of Education, controlling any of the programs listed in clause
(i) of subparagraph (B) of paragraph (1) of subdivision (a) of
Section 54761 and Section 64000 if the waiver does not result in a
decrease in the instructional time otherwise required by law or
regulation or an increase in state costs and is determined to be
consistent with subdivision (a) of Section 46300.
  SEC. 74.  Section 52270 of the Education Code is amended to read:
   52270.  The Education Technology Grant Program is hereby
established to provide one-time grants to school districts and
charter schools for purposes of acquiring computers for instructional
purposes at public schools.  The Office of the Secretary for
Education shall administer the application process for the award of
grants.
   (a) The first priority for the use of the funds is to ensure that
high school pupils in schools offering three or fewer advanced
placement courses have access to advanced placement courses online.
Grants awarded for the first priority may be expended to purchase or
lease computers and related equipment and for wiring or
infrastructure necessary to achieve connectivity to online advanced
placement courses.
   (b) The second priority for the use of the funds is to increase
the number of computers available to all other public schools that
offer instruction in kindergarten or any of grades 1 to 12,
inclusive.  Grants awarded for the purposes of the second priority
shall be awarded at the school district level and shall be based on a
ratio of pupils per computer, as determined by the Office of the
Secretary for Education.  A school district that receives a grant
shall award the funds to its schools that have the highest number of
pupils per computer.  Each education technology grant awarded based
on the second priority shall only be used for the purchase or lease
of computers including system configuration, software, and
instructional material.  The grant amount awarded to each school
district or charter school for the second priority shall be
determined by the Office of the Secretary for Education.
   (c) All funds awarded pursuant to this section shall be used
solely to purchase or lease equipment and related materials for
instructional purposes and limited to classroom, library, or
technology and media centers in order to provide access to online
advanced placement courses for pupils and increase the number of
computers per pupil.  These grant funds are to supplement, not
supplant, existing local, state, and federal education technology
funds, including Digital High School funds.
   (d) To receive a grant pursuant to this section, school districts
and charter schools shall have developed an education technology plan
or shall develop a plan with the assistance of the California
Technology Assistance Project specifically for the use of the funds
available pursuant to this section within 90 days after submission of
the application for a grant pursuant to this chapter.  The plan
shall address the use of these and other technology funds to ensure
they are used effectively and in a manner consistent with other
education technology available at the schoolsite.  School districts
and charter schools that choose to lease equipment shall include in
their technology plan a payment schedule and shall identify the
funding source or sources for lease payments over the life of the
lease, including, but not limited to, establishing a technology
leasing account and amortizing the available state funding over the
term of the lease, if appropriate.  In addition, the term of the
lease shall be no longer than four years unless authorized at local
discretion, in which case the lease or purchase shall be funded at
local expense.  A school district or charter school with an existing
certified or approved education technology plan developed pursuant to
other provisions of law may utilize the existing plan for the
purposes of this program but shall, if necessary, amend that plan to
meet the requirements of this subdivision if the school district or
charter school chooses to lease the computers.
   (e) School districts and charter schools may purchase or lease
computers, related equipment and materials, and other goods and
services using any statewide or cooperative contracts, schedules, or
other agreements, established by the Department of General Services.

   (f) Funding for the purposes of this section is contingent on an
appropriation made in the annual Budget Act or other legislation, or
both.
   (g) Funds appropriated to carry out this section in the 2000-01
fiscal year shall only be available to high schools, or charter
schools, that serve any of grades 9 to 12, inclusive.
   (h) The Secretary for Education may adopt emergency regulations
governing the method of allocating funds for the Education Technology
Grant Program for the 2000-01 fiscal year.
  SEC. 75.  Section 52485 of the Education Code is amended to read:
   52485.  (a) The Legislature recognizes that home economics career
technical education includes two distinct programs, consumer home
economics education which is crucial to the economic and social
well-being of individuals and families, and home economics related
occupation programs, which provide a continued source of trained and
qualified individuals for employment in various fields, including
child development and education, consumer services, fashion design,
manufacturing and merchandising, food science, dietetics and
nutrition, food service and hospitality, hospitality, tourism and
recreation, interior design, furnishings, and maintenance.  These
industries are of central importance to the economic growth and
development of the state, and their maintenance requires a continued
source of trained and qualified individuals in order to maintain a
productive workforce.
   (b) The Legislature hereby declares that it is in the best
interests of the people of the State of California that a
comprehensive home economics careers and technology career technical
program be created and maintained by the public school system to
include instruction in consumer home economics education, which
prepares individuals for effective personal life management and to be
a member of a well-functioning family, and instruction in home
economics related occupations education, in order to ensure both an
adequate supply of trained and skilled individuals, and appropriate
representation of racial and ethnic groups in all phases of the
industries.
   (c) For this purpose, the Legislature affirms that a program of
home economics career technical education shall be a part of the
curriculum of the public school system and made readily available to
all school districts which may, at their option, include programs in
career technical home economics education as a part of the curriculum
of that district.
  SEC. 76.  Section 54749 of the Education Code is amended to read:
   54749.  (a) For the 2000-01 fiscal year and each fiscal year
thereafter, a school district or county superintendent of schools
participating in Cal-SAFE shall be eligible for state funding from
funds appropriated for services provided for the purposes of the
program as follows:
   (1) A support services allowance of two thousand two hundred
thirty-seven dollars ($2,237) for each unit of average daily
attendance generated by each pupil who has completed the intake
process pursuant to subdivision (a) of Section 54746 and is receiving
services pursuant to subdivision (b) of Section 54746.  This
allowance shall be adjusted annually by the inflation factor set
forth in subdivision (b) of Section 42238.1.  In no event shall more
than one support service allowance be generated by any pupil
concurrently enrolled in more than one educational program.
   This allowance may not be claimed for units of average daily
attendance reported pursuant to the following:
   (A) Subdivision (b) of Section 1982 for pupils attending county
community schools operated pursuant to Chapter 6.5 of Part 2
(commencing with Section 1980).
   (B) Pupils attending juvenile court schools operated pursuant to
Article 2.5 (commencing with Section 48645) of Chapter 4 of Part 27.

   (C) Pupils attending community day schools operated pursuant to
Article 3 (commencing with Section 48660) of Chapter 4 of Part 27.
   (D) Pupils attending county operated Cal-SAFE programs pursuant to
this article whose attendance is reported pursuant to Section
2551.3.
   (2) Average daily attendance and revenue limit funding for pupils
receiving services in the Cal-SAFE program shall be computed pursuant
to provisions and regulations applicable to the educational program
or programs that each pupil attends, except as provided in paragraph
(3).
   (3) For attendance not claimed pursuant to paragraph (2), county
offices of education may claim the statewide average revenue limit
per unit of average daily attendance  for high school districts,
payable from Section A of the State School Fund, for the attendance
of pupils receiving services in the Cal-SAFE program, provided that
no other revenue limit funding is claimed for the same pupil and
pupil attendance of no less than 240 minutes per day and is computed
and maintained pursuant to Section 46300.
   (4) Except as provided in subdivision (c) of Section 54749.5,
operators of Cal-SAFE programs shall be reimbursed in accordance with
the amount specified in subdivision (b) of Section 8265 and the
amounts specified in subdivisions (a) and (b) of Section 8265.5 for
each child receiving services pursuant to the Cal-SAFE program who is
the child of teen parents enrolled in the Cal-SAFE program.  To be
eligible for funding pursuant to this paragraph, the operational days
of child care and development programs shall be only those necessary
to provide child care services to children of pupils participating
in Cal-SAFE.
   (5) Notwithstanding paragraph (1), pupils for whom attendance is
reported pursuant to subdivision (b) of Section 1982, pupils
attending juvenile court schools, and pupils attending community day
schools may complete the intake process for the Cal-SAFE program and,
if the intake process is completed, shall receive services pursuant
to subdivision (b) of Section 54746.  The children of pupils
receiving services in the Cal-SAFE program pursuant to subdivision
(b) of Section 54746 and attending juvenile court schools, county
community schools, or community day schools shall be eligible for
funding pursuant to paragraph (4) and no other provisions of this
section.
   (b) Funds allocated pursuant to paragraph (1) of subdivision (a)
shall be maintained in a separate account and shall be expended only
to provide the supportive services enumerated in subdivision (b) of
Section 54746, in-service training as specified in subdivision (d) of
Section 54746, and expenditures enumerated in subdivision (d) of
this section, to pupils enrolled in the Cal-SAFE program as
determined pursuant to Section 54746.
   (c) Funds allocated pursuant to paragraph (4) of subdivision (a)
shall be maintained in a separate account and shall be expended only
to provide developmentally appropriate child care and development
services pursuant to subdivision (c) of Section 54746 and staff
development of child development program staff pursuant to
subdivision (d) of Section 54746 for children of teen parents
enrolled in the Cal-SAFE program for the purpose of promoting the
children's development comparable to age norms, access to health and
preventive services, and enhanced school readiness.
   (d) Funds generated pursuant to Section 2551.3 and this section
shall be maintained in a separate account and shall be expended only
to provide the services enumerated in Section 54746 and the following
expenditures as defined by the California State School Accounting
Manual:
   (1) Expenditures defined as direct costs of instructional
programs.
   (2) Expenditures defined as documented direct support costs.
   (3) Expenditures defined as allocated direct support costs.
   (4) Expenditures for indirect charges.
   (5) Expenditures defined as facility costs, including the costs of
renting, leasing, lease purchase, remodeling, or improving
buildings.
   (e) Indirect costs shall not exceed the lesser of the approved
indirect cost rate or 10 percent.
   (f) Expenditures that represent contract payments to
community-based organizations and other governmental agencies
pursuant to paragraph (10) of subdivision (b) of Section 54745 for
the operation of a Cal-SAFE program shall be included in the Cal-SAFE
program account.
   (g) To the extent permitted by federal law, any funding made
available to a school district or county superintendent of schools
shall be subject to all of the following conditions:
   (1) The program is open to all eligible pupils without regard to
any pupil's religious beliefs or any other factor related to
religion.
   (2) No religious instruction is included in the program.
   (3) The space in which the program is operated is not used in any
manner to foster religion during the time used for operation of the
program.
   (h) A school district or county superintendent of schools
implementing a Cal-SAFE program may establish a claims process to
recover federal funds available for any services provided that are
Medi-Cal eligible.
   (i) For purposes of serving pupils enrolled in the Cal-SAFE
program in a summer school program or enrolled in a school program
operating more than 180 days, eligibility for child care services
pursuant to subdivision (c) of Section 54746 shall be determined by
the parent's hours of enrollment and shall be for only those hours
necessary to further the completion of the parent's educational
program.
   (j) To meet startup costs for the opening of child care and
development sites, as defined in subdivision (ac) of Section 8208,
and applicable regulations, a school district or county office of
education may apply for a one-time 15-percent service level exemption
within the amount appropriated in the annual Budget Act for the
purposes of paragraph (4) of subdivision (a) for each site meeting
the provision of subdivision (ac) of Section 8208.  To the extent
that Budget Act funding is insufficient to cover the full costs of
Cal-SAFE child care, reimbursements to all participating programs
shall be reduced on a pro rata basis.  A school district or county
office of education shall submit claims pursuant to this subdivision
with other claims submitted pursuant to this section.  Funding
provided for startup costs shall be utilized for approvable startup
costs enumerated in subdivision (a) of Section 8275.
   (k) Notwithstanding any other provision of this article,
implementation of this article is contingent upon appropriations in
the annual Budget Act for the purpose of its administration and
evaluation by the State Department of Education.
   (l) Notwithstanding any other provision of law, a charter school
may apply for funding pursuant to this article and shall meet the
requirements of this article to be eligible for funding pursuant to
this section.
  SEC. 77.  Section 56045 of the Education Code is amended to read:
   56045.  (a) The superintendent shall send a notice to the
governing board of each local education agency within 30 days of when
the superintendent determines any of the following:
   (1) The district, special education local plan area, or county
office is substantially out of compliance with one or more
significant provisions of this part, the implementing regulations,
provisions of the Individuals with Disabilities Education Act (20
U.S.C. Sec. 1400 et seq.), or the implementing regulations.
   (2) The district, special education local plan area, or county
office fails to comply substantially with corrective action orders
issued by the department resulting from focused monitoring findings
or complaint investigations.
   (3) The district, special education local plan area, or county
office fails to implement the decision of a due process hearing
officer for noncompliance with provisions of this part, the
implementing regulations, provisions of the Individuals with
Disabilities Education Act (20 U.S.C. Sec.  1400 et seq.), or the
implementing regulations, which noncompliance results in the denial
of, or impedes the delivery of, a free and appropriate public
education for an individual with exceptional needs.
   (b) The notice shall provide a description of the special
education and related services that are required by law and with
which the district, special education local plan area, or county
office is not in compliance.
   (c) Upon receipt of the notification sent pursuant to subdivision
(a), the governing board shall at a regularly scheduled public
hearing address the issue of noncompliance.
  SEC. 78.  Section 56845 of the Education Code is amended to read:
   56845.  (a) The superintendent may withhold, in whole or in part,
state funds or federal funds allocated under the Individuals with
Disabilities Education Act (20 U.S.C. Sec. 1400 et seq.) from a
district, special education local plan area, or county office after
reasonable notice and opportunity for a hearing if the superintendent
finds either of the following:
   (1) The district, special education local plan area, or county
office failed to comply substantially with a provision of state law,
federal law, or regulations governing the provision of special
education and related services to individuals with exceptional needs
which results in the failure to comply substantially with corrective
action orders issued by the department resulting from monitoring
findings or complaint investigations.
                                           (2) The district, special
education local plan area, or county office failed to implement the
decision of a due process hearing officer based on noncompliance with
provisions of this part, the implementing regulations, provisions of
the Individuals with Disabilities Education Act (20 U.S.C.  Sec.
1400 et seq.), or the implementing regulations, which noncompliance
results in the denial of, or impedes the delivery of, a free and
appropriate public education for an individual with exceptional
needs.
   (b) When the superintendent determines that a district, special
education local plan area, or county office made substantial progress
toward compliance with state law, federal law, or regulations
governing the provision of special education and related services to
individuals with exceptional needs, the superintendent may apportion
the state or federal funds withheld from the district, special
education local plan area, or county office.
   (c) Notwithstanding any other provision of law, state funds may
not be allocated to offset any federal funding intended for
individuals with exceptional needs, as defined in Section 56026, and
withheld from a local educational agency due to the agency's
noncompliance with state or federal law.
   (d) For purposes of this section, in order to enter into contracts
with one or more local education agencies to serve individuals with
exceptional needs who are not being served as required under this
part, the department is exempt from the requirements of Part 2
(commencing with Section 10100) of Division 2 of the Public Contract
Code and from the requirements of Article 6 (commencing with Section
999) of Chapter 6 of Division 4 of the Military and Veterans Code.
  SEC. 79.  Section 69432.7 of the Education Code is amended to read:

   69432.7.  As used in this chapter, the following terms have the
following meanings:
   (a) An "academic year" is July 1 to June 30, inclusive.  The
starting date of a session shall determine the academic year in which
it is included.
   (b) "Access costs" means living expenses and expenses for
transportation, supplies, and books.
   (c) "Award year" means one academic year, or the equivalent, of
attendance at a qualifying institution.
   (d) "College grade point average" and "community college grade
point average" mean a grade point average calculated on the basis of
all college work completed, except for nontransferable units and
courses not counted in the computation for admission to a California
public institution of higher education that grants a baccalaureate
degree.
   (e) "Commission" means the Student Aid Commission.
   (f) "Enrollment status" means part-time status or full-time
status.
   (1) Part time, for purposes of Cal Grant eligibility, is defined
as 6 to 11 semester units, inclusive, or the equivalent.
   (2) Full time, for purposes of Cal Grant eligibility, is defined
as 12 or more semester units or the equivalent.
   (g) "Expected family contribution," with respect to an applicant,
shall be determined using the federal methodology pursuant to
subdivision (a) of Section 69506 (as established by Title IV of the
federal Higher Education Act of 1965, as amended (20 U.S.C. Sec. 1070
et seq.)) and applicable rules and regulations adopted by the
commission.
   (h) "High school grade point average" means a grade point average
calculated on a 4.0 scale, using all academic coursework, for the
sophomore year, the summer following the sophomore year, the junior
year, and the summer following the junior year, excluding physical
education, reserve officer training corps (ROTC), and remedial
courses, and computed pursuant to regulations of the commission.
However, for high school graduates who apply after their senior year,
"high school grade point average" includes senior year coursework.
   (i) "Instructional program of not less than one academic year"
means a program of study that results in the award of an associate or
baccalaureate degree or certificate requiring at least 24 semester
units or the equivalent, or that results in eligibility for transfer
from a community college to a baccalaureate degree program.
   (j) "Instructional program of not less than two academic years"
means a program of study that results in the award of an associate or
baccalaureate degree requiring at least 48 semester units or the
equivalent, or that results in eligibility for transfer from a
community college to a baccalaureate degree program.
   (k) "Maximum household income and asset levels" means the
applicable household income and household asset levels for
participants in the Cal Grant Program, as defined and adopted in
regulations by the commission for the 2001-02 academic year, which
shall be set pursuant to the following income and asset ceiling
amounts:


                       CAL GRANT PROGRAM INCOME CEILINGS

            --------------------------------------------------------
            '                            Cal Grant A,              '
            '                              C, and T   Cal Grant B  '
            '------------------------------------------------------'
            '  Dependent and Independent students with dependents* '
            '   Family Size                                        '
            '      Six or more             $74,100      $40,700    '
            '      Five                    $68,700      $37,700    '
            '      Four                    $64,100      $33,700    '
            '      Three                   $59,000      $30,300    '
            '      Two                     $57,600      $26,900    '
            '                                                      '
            '  Independent                                         '
            '      Single, no dependents   $23,500      $23,500    '
            '      Married                 $26,900      $26,900    '
            --------------------------------------------------------
*Applies to independent students with dependents other than a
spouse.



                      CAL GRANT PROGRAM ASSET CEILINGS

            -------------------------------------------------------
            '                            Cal Grant A,              '
            '                              C, and T   Cal Grant B  '
            '------------------------------------------------------'
            '                                                      '
            '  Dependent**                 $49,600      $49,600    '
            '  Independent                 $23,600      $23,600    '
            '------------------------------------------------------'
**Applies to independent students with dependents other than a
spouse.

   The commission shall annually adjust the maximum household income
and asset levels based on the percentage change in the cost of living
within the meaning of paragraph (1) of subdivision (e) of Section 8
of Article XIIIB of the California Constitution.
   (l) "Qualifying institution" means any of the following:
   (1) Any California private or independent postsecondary
educational institution that participates in the Pell Grant program
and in at least two of the following federal campus-based student aid
programs:
   (A) Federal Work-Study.
   (B) Perkins Loan Program.
   (C) Supplemental Educational Opportunity Grant Program.
   (2) Any nonprofit institution headquartered and operating in
California that certifies to the commission that 10 percent of the
institution's operating budget, as demonstrated in an audited
financial statement, is expended for the purposes of institutionally
funded student financial aid in the form of grants, that demonstrates
to the commission that it has the administrative capacity to
administer the funds, that is accredited by the Western Association
of Schools and Colleges, and that meets any other state-required
criteria adopted by regulation by the commission in consultation with
the Department of Finance.  A regionally accredited institution that
was deemed qualified by the commission to participate in the Cal
Grant Program for the 2000-01 academic year shall retain its
eligibility as long as it maintains its existing accreditation
status.
   (3) Any California public postsecondary educational institution.
   (m) "Satisfactory academic progress" means those criteria required
by applicable federal standards published in Title 34 of the Code of
Federal Regulations.  The commission may adopt regulations defining
"satisfactory academic progress" in a manner that is consistent with
those federal standards.
  SEC. 80.  Section 69434.5 of the Education Code is amended to read:

   69434.5.  An individual selected for a Cal Grant A award who
enrolls in a California community college may elect to have the award
held in reserve for him or her for a period not to exceed two
academic years, except that the commission may extend the period in
which his or her award may be held in reserve for up to three
academic years if, in the commission's judgment, the rate of academic
progress has been as rapid as could be expected for the personal and
financial conditions that the student has encountered.  The
commission shall, in this case, hold the award in reserve for the
additional year.  Upon receipt of a request to transfer the award to
a tuition or fee charging qualifying institution, the individual
shall be eligible to receive the Cal Grant A award previously held in
reserve if, at the time of the request, he or she meets all of the
requirements of this article.  Upon receipt of the request, the
commission shall reassess the financial need of the award recipient.
The commission may prescribe the forms and procedures to be utilized
for the purposes of this section.  A recipient's years of
eligibility for payment of benefits shall be based upon his or her
grade level at the time the award is transferred to the tuition or
fee charging qualifying institution.
  SEC. 81.  Section 69437.6 of the Education Code is amended to read:

   69437.6.  (a) An applicant competing for an award under this
article shall meet all the requirements of Article 1 (commencing with
Section 69430).
   (b) To compete for a competitive Cal Grant A award, an applicant
shall, at a minimum, meet all of the requirements of Article 2
(commencing with Section 69434), with the exception of paragraph (1)
of subdivision (b) of Section 69434.
   (c) To compete for a competitive Cal Grant B award, an applicant
shall, at a minimum, meet all of the requirements of Article 3
(commencing with Section 69435).  However, in lieu of meeting the
grade point average requirements of paragraph (3) of subdivision (a)
of Section 69435.3, a student may reestablish his or her grade point
average by completing at least 16 cumulative units of credit for
academic coursework at an accredited California Community College, as
defined by the commission, by regulation, with at least a 2.0
community college grade point average.
   (d) To compete for a competitive California Community College
Transfer Cal Grant Award, an applicant shall, at a minimum, meet the
requirements of Article 4 (commencing with Section 69436), with the
exception of paragraph (8) of subdivision (b) of Section 69436.
   (e) All other competitors shall, at a minimum, comply with all of
the requirements of subdivision (b) of Section 69432.9.
   (f) An individual selected for a Cal Grant A award who enrolls in
a California Community College may elect to have the award held in
reserve for him or her for a period not to exceed two academic years,
except that the commission may extend the period in which his or her
award may be held in reserve for up to three academic years if, in
the commission's judgment, the rate of academic progress has been as
rapid as could be expected for the personal and financial conditions
that the student has encountered.  The commission shall, in this
case, hold the award in reserve for the additional year.  Upon
receipt of a request to transfer the award to a tuition or fee
charging qualifying institution, the individual shall be eligible to
receive the Cal Grant A award previously held in reserve if, at the
time of the request, he or she meets all of the requirements of this
article.  Upon receipt of the request, the commission shall reassess
the financial need of the award recipient.  The commission may
prescribe the forms and procedures to be utilized for the purposes of
this section.  A recipient's years of eligibility for payment of
benefits shall be based upon his or her grade level at the time the
award is transferred to the tuition or fee charging qualifying
institution.  Any award so held in reserve shall only be counted once
toward the 22,500 awards authorized by this article.
  SEC. 82.  Section 69439 of the Education Code is amended to read:
   69439.  (a) Commencing with the 2001-02 academic year, and each
academic year thereafter, a Cal Grant C award shall be utilized only
for occupational or technical training in a course of not less than
four months.  There shall be the same number of Cal Grant C awards
each year as were made in the 2000-01 fiscal year.  The maximum award
amount and the total amount of funding shall be determined each year
in the annual Budget Act.
   (b) "Occupational or technical training" means that phase of
education coming after the completion of a secondary school program
and leading toward recognized occupational goals approved by the
commission.
   (c) The commission may use criteria it deems appropriate in
selecting students with occupational talents to receive grants for
occupational or technical training.
   (d) The Cal Grant C recipients shall be eligible for renewal of
their grants until they have completed their occupational or
technical training in conformance with terms prescribed by the
commission.  In no case shall the grants exceed two calendar years.
   (e) Cal Grant C awards shall be for institutional fees, charges,
and other costs, including tuition, plus training-related costs, such
as special clothing, local transportation, required tools,
equipment, supplies, and books.  In determining the amount of grants
and training-related costs, the commission shall take into account
other state and federal programs available to the applicant.
   (f) Cal Grant C awards shall be awarded in areas of occupational
or technical training as determined by the commission after
consultation with appropriate state and federal agencies.
  SEC. 83.  Section 69613.1 of the Education Code is amended to read:

   69613.1.  The Superintendent of Public Instruction shall furnish
the commission with all of the following:
   (a) Commencing January 1, 1990, and every January 1 thereafter, a
list of teaching fields that have the most critical shortage of
teachers.  The superintendent shall review this list annually and
revise the list as he or she deems necessary.  Commencing January 1,
2001, the list of shortage areas furnished pursuant to this
subdivision shall include the state special schools as a category
separate from special education.
   (b) A list of schools that serve a large population of pupils from
low-income families, as designated for purposes of the Perkins Loan
Program, or according to standards the superintendent deems
appropriate.
   (c) Commencing January 31, 2001, and every January 1 thereafter, a
list of schools with a high percentage of teachers holding emergency
permits.  The list shall be established according to criteria
determined by the superintendent.
   (d) Commencing January 31, 2001, and every January 1 thereafter, a
list of schools serving rural areas.  The list shall be established
according to standards deemed appropriate by the superintendent.
   (e) Commencing January 31, 2001, and every January 1 thereafter, a
list of low-performing schools.
  SEC. 84.  Section 87164 of the Education Code is amended to read:
   87164.  (a) An employee or applicant for employment with a public
school employer who files a written complaint with his or her
supervisor, a community college administrator, or the public school
employer alleging actual or attempted acts of reprisal, retaliation,
threats, coercion, or similar improper acts prohibited by Section
87163 for having disclosed improper governmental activities or for
refusing to obey an illegal order may also file a copy of the written
complaint with the local law enforcement agency, together with a
sworn statement that the contents of the written complaint are true,
or are believed by the affiant to be true, under penalty of perjury.
The complaint filed with the local law enforcement agency shall be
filed within 12 months of the most recent act of reprisal that is the
subject of the complaint.
   (b) A person who intentionally engages in acts of reprisal,
retaliation, threats, coercion, or similar acts against an employee
or applicant for employment with a public school employer for having
made a protected disclosure is subject to a fine not to exceed ten
thousand dollars ($10,000) and imprisonment in the county jail for a
period not to exceed one year.  An employee, officer, or
administrator who intentionally engages in that conduct shall also be
subject to discipline by the public school employer.  If no adverse
action is instituted by the public school employer and it is
determined that there is reasonable cause to believe that an act of
reprisal, retaliation, threats, coercion, or similar acts prohibited
by Section 87163 occurred, the local law enforcement agency may
report the nature and details of the activity to the governing board
of the community college district.
   (c) In addition to all other penalties provided by law, a person
who intentionally engages in acts of reprisal, retaliation, threats,
coercion, or similar acts against an employee or applicant for
employment with a public school employer for having made a protected
disclosure shall be liable in an action for damages brought against
him or her by the injured party.  Punitive damages may be awarded by
the court where the acts of the offending party are proven to be
malicious.  Where liability has been established, the injured party
shall also be entitled to reasonable attorney's fees as provided by
law.  However, an action for damages shall not be available to the
injured party unless the injured party has first filed a complaint
with the local law enforcement agency.
   (d) This section is not intended to prevent a public school
employer, school administrator, or supervisor from taking, failing to
take, directing others to take, recommending, or approving a
personnel action with respect to an employee or applicant for
employment with a public school employer if the public school
employer, school administrator, or supervisor reasonably believes an
action or inaction is justified on the basis of evidence separate and
apart from the fact that the person has made a protected disclosure
as defined in subdivision (e) of Section 87162.
   (e) In any civil action or administrative proceeding, once it has
been demonstrated by a preponderance of evidence that an activity
protected by this article was a contributing factor in the alleged
retaliation against a former, current, or prospective employee, the
burden of proof shall be on the supervisor, school administrator, or
public school employer to demonstrate by clear and convincing
evidence that the alleged action would have occurred for legitimate,
independent reasons even if the employee had not engaged in protected
disclosures or refused an illegal order.  If the supervisor, school
administrator, or public school employer fails to meet this burden of
proof in an adverse action against the employee in any
administrative review, challenge, or adjudication in which
retaliation has been demonstrated to be a contributing factor, the
employee shall have a complete affirmative defense in the adverse
action.
   (f) Nothing in this article shall be deemed to diminish the
rights, privileges, or remedies of an employee under any other
federal or state law or under an employment contract or collective
bargaining agreement.
   (g) If the provisions of this section are in conflict with the
provisions of a memorandum of understanding reached pursuant to
Chapter 10.7 (commencing with Section 3540) of Division 4 of Title 1
of the Government Code, the memorandum of understanding shall be
controlling without further legislative action.
  SEC. 85.  Section 92901 of the Education Code is amended to read:
   92901.  It is the intent of the Legislature that all of the
following occur:
   (a) That the University of California receive seventy-five million
dollars ($75,000,000) for each year for four years, for a total of
three hundred million dollars ($300,000,000) for the 2000-01 fiscal
year to the 2003-04 fiscal year, inclusive, for capital and operating
budget purposes.
   (b) That a portion of the funds referenced in subdivision (a) be
available, in an amount not to exceed 5 percent of the annual
appropriation, for annual operating budget expenditures.  At the end
of four years, the level of ongoing funding for the operating budget
of the institutes will be determined by the Governor and the
Legislature through the annual budget process.
   (c) That the University of California not seek further state
funding for capital outlay associated with these three institutes
beyond that provided within the three hundred million dollar
($300,000,000) total.
   (d) That every dollar of state funds appropriated for these
institutes be matched by at least two dollars ($2) of nonstate funds,
including, but not necessarily limited to, federal and private
funds.
  SEC. 86.  Section 1405 of the Elections Code is amended to read:
   1405.  (a) Except as provided below, the election for a county,
municipal, or district initiative that qualifies pursuant to Section
9116, 9214, or 9310 shall be held not less than 88 nor more than 103
days after the date of the order of election.
   (1) When it is legally possible to hold a special election on an
initiative measure that has qualified pursuant to Section 9116, 9214,
or 9310 within 180 days prior to a regular or special election
occurring wholly or partially within the same territory, the election
on the initiative measure may be held on the same date as, and be
consolidated with, that regular or special election.
   (2) To avoid holding more than one special election within any
180-day period, the date for holding the special election on an
initiative measure that has qualified pursuant to Section 9116, 9214,
or 9310, may be fixed later than 103 days but at as early a date as
practicable after the expiration of 180 days from the last special
election.
   (3) Not more than one special election for an initiative measure
that qualifies pursuant to Section 9116, 9214, or 9310 may be held by
a jurisdiction during any period of 180 days.
   (b) The election for a county initiative that qualifies pursuant
to Section 9118 shall be held at the next statewide election
occurring not less than 88 days after the date of the order of
election.  The election for a municipal or district initiative that
qualifies pursuant to Section 9215 or 9311 shall be held at the
jurisdiction's next regular election occurring not less than 88 days
after the date of the order of election.
  SEC. 87.  Section 8040 of the Elections Code is amended to read:
   8040.  (a) The declaration of candidacy by a candidate shall be
substantially as follows:


                         DECLARATION OF CANDIDACY

      I hereby declare myself a ____ Party candidate for nomination
to
    the office of ____ District Number ____ to be voted for at the
    primary election to be held ____,  20__, and declare the
following
    to be true:
      My name is
____________________________________________________.
      I want my name and occupational designation to appear on the
    ballot as follows: ________.
        Addresses:
        Residence
____________________________________________________

____________________________________________________
        Business
_____________________________________________________

_____________________________________________________
        Mailing
_____________________________________________________

_____________________________________________________
        Telephone numbers:  Day _________  Evening ___________
        I meet the statutory and constitutional qualifications for
this
    office (including, but not limited to, citizenship, residency,
and
    party affiliation, if required).
        I am at present an incumbent of the following public office
    (if any) ____.
        If nominated, I will accept the nomination and not withdraw.


________________________________________
                                            Signature of candidate

    State of California    )
    County of _________    ) ss.
                           )

      Subscribed and sworn to before me this ____ day of ____,  20__.


_________________________________________
                                   Notary Public (or other official)

      Examined and certified by me this ________ day of _______,
20__.

_________________________________________
                                   Registrar of Voters--County Clerk
WARNING:  Every person acting on behalf of a candidate is guilty of
a misdemeanor who deliberately fails to file at the proper time and
in the proper place any declaration of candidacy in his or her
possession which is entitled to be filed under the provisions of the
Elections Code Section 18202.

   (b) A candidate for a judicial office may not be required to state
his or her residential address on the declaration of candidacy.
However, in cases where the candidate does not state his or her
residential address on the declaration of candidacy, the elections
official shall verify whether his or her address is within the
appropriate political subdivision and add the notation "verified"
where appropriate.
  SEC. 88.  Section 9118 of the Elections Code is amended to read:
   9118.  If the initiative petition is signed by voters not less in
number than 10 percent of the entire vote cast in the county for all
candidates for Governor at the last gubernatorial election preceding
the publication of the notice of intention to circulate an initiative
petition, the board of supervisors shall do one of the following:
   (a) Adopt the ordinance without alteration at the regular meeting
at which the certification of the petition is presented, or within
                                       10 days after it is presented.

   (b) Submit the ordinance, without alteration, to the voters
pursuant to subdivision (b) of Section 1405, unless the ordinance
petitioned for is required to be, or for some reason is, submitted to
the voters at a special election pursuant to subdivision (a) of
Section 1405.
   (c) Order a report pursuant to Section 9111 at the regular meeting
at which the certification of the petition is presented.  When the
report is presented to the board of supervisors, it shall either
adopt the ordinance within 10 days or order an election pursuant to
subdivision (b).
  SEC. 89.  Section 15375 of the Elections Code is amended to read:
   15375.  The elections official shall send to the Secretary of
State within 35 days of the election in the manner requested one
complete copy of all results as to all of the following:
   (a) All candidates voted for statewide office.
   (b) All candidates voted for the following offices:
   (1) Member of the Assembly.
   (2) Member of the Senate.
   (3) Member of the United States House of Representatives.
   (4) Member of the State Board of Equalization.
   (5) Justice of the  Court of Appeal.
   (6) Judge of the superior court.
   (7) Judge of the municipal court.
   (c) All persons voted for at the presidential primary.  The
results for all persons voted for at the presidential primary for
delegates to national conventions shall be canvassed and shall be
sent within 28 days after the election.  The results at the
presidential primary for candidates for President to whom delegates
of a political party are pledged shall be reported according to the
number of votes each candidate received from all voters and
separately according to the number of votes each candidate received
from voters affiliated with each political party qualified to
participate in the presidential primary election, and from voters who
have declined to affiliate with a qualified political party.
   (d) The vote given for persons for electors of President and Vice
President of the United States.  The results for presidential
electors shall be endorsed "Presidential Election Returns."
   (e) All statewide measures.
  SEC. 90.  Section 17504 of the Family Code is amended to read:
   17504.  The first fifty dollars ($50) of any amount of child
support collected in a month in payment of the required support
obligation for that month shall be paid to a recipient of aid under
Article 2 (commencing with Section 11250) of Chapter 2 of Part 3 of
Division 9 of the Welfare and Institutions Code, except recipients of
foster care payments under Article 5 (commencing with Section 11400)
of Chapter 2 of Part 3 of Division 9 of the Welfare and Institutions
Code shall not be considered income or resources of the recipient
family, and shall not be deducted from the amount of aid to which the
family would otherwise be eligible.  The local child support agency
in each county shall ensure that payments are made to recipients as
required by this section.
  SEC. 91.  Section 761.5 of the Financial Code is amended to read:
   761.5.  (a) In this section:
   (1) "Depository institution" has the meaning set forth in Section
3(c) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1813(c)).
   (2) "Depository institution holding company" has the meaning set
forth in Section 3(w) of the Federal Deposit Insurance Act (12 U.S.C.
Sec. 1813(w)).
   (b) Notwithstanding any provision of this code to the contrary,
and except as the commissioner may otherwise order, a California
state bank may purchase for its own account shares of the stock of an
insured bank or of a holding company that owns or controls an
insured bank if the stock of the bank or company is owned exclusively
(except to the extent directors' qualifying shares are required by
law) by depository institutions or depository institution holding
companies and if the bank or company and all subsidiaries thereof are
engaged exclusively in providing services to or for other depository
institutions, their holding companies, and the officers, directors,
and employees of these institutions and companies and in providing
correspondent banking services at the request of other depository
institutions or their holding companies.
  SEC. 92.  Section 4827 of the Financial Code is amended to read:
   4827.  Except as expressly provided otherwise in this division:
   (a) (1) No sale of a whole business unit (as defined in Section
4840) or merger in which the selling or disappearing depository
corporation is a California state savings association, in which the
purchasing or surviving depository corporation is a California state
bank, a California industrial loan company, or a California
state-licensed foreign (other nation) bank, and which may be effected
with the approval of the commissioner pursuant to this division is
prohibited or restricted by any provision of Division 2 (commencing
with Section 5000) or requires any approval, consent, or other
authorization of the commissioner pursuant to Division 2 (commencing
with Section 5000).
   (2) No conversion in which the converting depository corporation
is a California state savings association in which the resulting
depository corporation is a California state bank or a California
industrial loan company, and which may be effected with the approval
of the commissioner pursuant to this division is prohibited or
restricted by any provision of Division 2 (commencing with Section
5000) or requires any approval, consent, or other authorization of
the commissioner pursuant to Division 2 (commencing with Section
5000).
   (b) (1) No sale of a whole business unit (as defined in Section
4840) or merger in which the selling or disappearing depository
corporation is a California state bank, a California state-licensed
foreign (other nation) bank, or a California industrial loan company,
in which the purchasing or surviving depository corporation is a
California state savings association, and which may be effected with
the approval of the commissioner pursuant to this division is
prohibited or restricted by any provision of Division 1 (commencing
with Section 99), except the provisions of Chapter 22 (commencing
with Section 3800) of Division 1, or requires any approval, consent,
or other authorization of the commissioner pursuant to Division 1,
except as may be required under the provisions of Chapter 22
(commencing with Section 3800) of Division 1.
   (2) No conversion in which the converting depository corporation
is a California state bank or a California industrial loan company,
in which the resulting depository corporation is a California state
savings association, and which may be effected with the approval of
the commissioner pursuant to this division is prohibited or
restricted by any provision of Division 1 (commencing with Section
99), except the provisions of Chapter 22 (commencing with Section
3800) of Division 1, or requires any approval, consent, or other
authorization of the commissioner pursuant to Division 1, except as
may be required under the provisions of Chapter 22 (commencing with
Section 3800) of Division 1.
  SEC. 93.  Section 16024 of the Financial Code is amended to read:
   16024.  (a) Within 30 days of establishing a California facility,
a foreign (other state) credit union shall notify the commissioner in
writing of its intent to establish a California facility.  The
notice shall identify the proposed location of the facility, describe
its proposed activities, and contain any other information which the
commissioner may by regulation or order specify.
   (b) A foreign (other state) credit union shall not commence
business at a proposed facility without a license having been issued
by the commissioner.
  SEC. 94.  Section 16501 of the Financial Code is amended to read:
   16501.  In this chapter:
   (a) "Agency," when used with respect to a foreign (other nation)
credit union, means an office in this state at which the foreign
(other nation) credit union transacts credit union business, other
than branch business.
   (b) "Branch business" means the business of issuing shares or
certificates, receiving deposits, paying checks, making loans, and
other activities that the commissioner may specify by order or
regulation.
   (c) "Branch office," when used with respect to a foreign (other
nation) credit union, means an office in this state at which the
foreign (other nation) credit union engages in branch business.
   (d) "Business in this state," when used with respect to a foreign
(other nation) credit union that is licensed to maintain one or more
offices, includes the aggregate business of all of the offices.
   (e) "Foreign nation" means any nation other than the United
States, including, without limitation, any subdivision, territory,
trust territory, dependency, colony, or possession of any nation
other than the United States.
   (f) "Foreign (other nation) credit union" means any credit union
or similar institution that is organized under the laws of a foreign
nation.
   (g) "Foreign (other state) state credit union" means a credit
union that is organized under the laws of a state of the United
States other than California.
   (h) "Home country," when used with respect to a foreign (other
nation) credit union, means the foreign nation under whose laws the
foreign (other nation) credit union is organized.
   (i) "Home country regulator," when used with respect to a foreign
(other nation) credit union, means the regulatory agency in the home
country of the foreign (other nation) credit union that has primary
regulatory authority over the foreign (other nation) credit union.
   (j) (1) "License" means a license issued under this chapter,
authorizing a foreign (other nation) credit union to maintain an
office.
   (2) To be "licensed" means to be issued or to hold a license.
   (3) To be "licensed to transact business in this state," when used
with respect to a foreign (other nation) credit union, means that
the foreign (other nation) credit union is licensed to maintain an
agency or branch office.
   (k) "Office," when used with respect to a foreign (other nation)
credit union, means a branch office, an agency, or a representative
office maintained by the foreign (other nation) credit union.
   (l) "Representative office," when used with respect to a foreign
(other nation) credit union, means an office in this state at which
the foreign (other nation) credit union engages in representational
functions but at which it does not transact business.
   (m) "State of the United States" means any state of the United
States, the District of Columbia, any territory of the United States,
Puerto Rico, Guam, American Samoa, the Trust Territory of the
Pacific Islands, the Virgin Islands, and the Northern Mariana
Islands.
  SEC. 95.  Section 18586 of the Financial Code is amended to read:
   18586.  The provisions of Sections 18023, 18024, 18120, 18205,
18268, 18269, 18271, 18272, 18274, and 18455 shall not apply to a
premium finance agency.
  SEC. 96.  Section 1506 of the Fish and Game Code is amended to
read:
   1506.  (a) The fisheries management program described in the Kings
River Fisheries Management Program Framework Agreement, effective
May 28, 1999, as approved by the department, is adopted and
authorized.  The department may contribute, from the Fish and Game
Preservation Fund, or otherwise upon appropriation by the
Legislature, up to 50 percent of any capital costs incurred by local
agencies for the recreation and fish and wildlife enhancement
features of the program.
   (b) This section shall remain in effect only until January 1,
2011, and as of that date is repealed, unless a later enacted statute
that is enacted before January 1, 2011, deletes or extends that
date.
  SEC. 97.  Section 2921 of the Fish and Game Code is amended to
read:
   2921.  For purposes of this chapter, the following terms shall
have the following meanings:
   (a) "Conservation district" means the Suisun Resource Conservation
District.
   (b) "Early flooding program" means the flooding of privately owned
wetlands on which waterfowl ponds are located and that are initially
flooded prior to October 1 of each year and that may remain flooded
after that date.
   (c) "Late flooding program" means the flooding of privately owned
wetlands on which waterfowl ponds are located and that are initially
flooded on or after October 1 of each year.
   (d) "Mosquito district" means the Solano County Mosquito Abatement
District.
   (e) "Program" means the Suisun Marsh Wetland Enhancement and
Mosquito Abatement Demonstration Program.
  SEC. 98.  Section 8276.3 of the Fish and Game Code is amended to
read:
   8276.3.  (a) If there is any delay ordered by the director
pursuant to Section 8276.2 in the opening of the Dungeness crab
fishery in Districts 6, 7, 8, and 9, a vessel may not take or land
crab within Districts 6, 7, 8, and 9 during any closure.
   (b) If there is any delay in the opening of the Dungeness crab
season pursuant to Section 8276.2, the opening date in Districts 6,
7, 8, and 9 shall be preceded by a 36-hour gear setting period, as
ordered by the director.
   (c) This section shall become inoperative on April 1, 2006, and,
as of January 1, 2007, is repealed, unless a later enacted statute
that is enacted before January 1, 2007, deletes or extends the dates
on which it becomes inoperative and is repealed.
  SEC. 99.  Section 492 of the Food and Agricultural Code is amended
to read:
   492.  (a) The Legislature hereby creates the Food Biotechnology
Task Force.  The task force shall be cochaired by the Secretary of
the California Health and Welfare Agency, the Secretary of the
California Trade and Commerce Agency, and the Secretary of the
California Department of Food and Agriculture.  The task force shall
consult with appropriate state agencies and the University of
California.  The California Department of Food and Agriculture shall
be the lead agency.
   (b) An advisory committee shall be appointed by the task force to
provide input on issues reviewed by the task force.  The advisory
committee shall consist of representatives from consumer groups,
environmental organizations, farmers, ranchers, representatives from
the biotechnology industry, researchers, organic farmers, food
processors, retailers, and others with interests in the issues
surrounding biotechnology.
   (c) The California Department of Food and Agriculture shall make
funds available to other agencies to accomplish the purposes of this
article and shall contract, where appropriate, with the California
Council on Science and Technology, the University of California, or
other entities to review issues evaluated by the task force or
support activities of the advisory committee.
   (d) The task force may request particular agencies to lead the
effort to evaluate various factors related to food biotechnology.  As
funding becomes available, the task force shall evaluate factors
including all of the following:
   (1) Definition and categorization of food biotechnology and
production processes.
   (2) Scientific literature on the subject, and a characterization
of information resources readily available to consumers.
   (3) Issues related to domestic and international marketing of
biotechnology foods such as the handling, processing, manufacturing,
distribution, labeling, and marketing of these products.
   (4) Potential benefits and impacts to human health, the state's
economy, and the environment accruing from food biotechnology.
   (5) Existing federal and state evaluation and oversight
procedures.
   (e) The task force shall report issues studied, findings, basis
for their findings, and recommendations to the Governor and the
Legislature by January 1, 2003.
   (f) An initial sum of one hundred twenty-five thousand dollars
($125,000) is hereby appropriated from the General Fund for
disbursement to the California Department of Food  and Agriculture.
It is the intent of the Legislature to make further funds available
to accomplish the purposes contained in this article.
  SEC. 100.  Section 6046 of the Food and Agricultural Code is
amended to read:
   6046.  (a) There is hereby created in the Department of Food and
Agriculture the Pierce's Disease Control Program.
   (b) The Governor shall appoint a statewide coordinator, and the
secretary shall provide an appropriate level of support staffing and
logistical support for combating Pierce's disease and its vectors.
   (c) (1) There is hereby created the Pierce's Disease Management
Account in the Food and Agriculture Fund.
   (2) The account shall consist of money transferred from the
General Fund under subdivision (d) and money made available from
federal, industry, and other sources.  Money made available from
federal, industry, and other sources shall be available for
expenditure without regard to fiscal year for the purpose of
combating Pierce's disease or its vectors.  State general funds to be
utilized for research shall only be expended when the secretary has
received commitments from nonstate sources for at least a 25-percent
match for each state dollar to be expended.
   (d) (1) The sum of six million nine hundred thousand dollars
($6,900,000) is hereby appropriated from the General Fund to the
account created by this article in the Department of Food and
Agriculture Fund and shall be available for expenditure by the
department without regard to fiscal year for the purpose of combating
Pierce's disease or its vectors.
   (2) It is the intent of the Legislature that a total of thirteen
million eight hundred thousand dollars ($13,800,000) be made
available from the General Fund for purposes of providing funding to
the program established by subdivision (a).  Therefore, it is further
the intent of the Legislature, in addition to the appropriation in
paragraph (1), to appropriate six million nine hundred thousand
dollars ($6,900,000) from the General Fund in the Budget Act of 2000
to the department for the purpose of funding the program established
by subdivision (a).
   (e) The funds appropriated pursuant to this section to the Food
and Agriculture Fund for the purpose of combating Pierce's disease
and its vectors shall be used for costs that are incurred by the
state or by local entities during and subsequent to the fiscal year
of the act that added this section for the purpose of research  and
other efforts to combat Pierce's disease and its vectors.
   (f) Whenever, in any county, funds are allocated by the Department
of Food and Agriculture for local assistance regarding Pierce's
disease and its vectors, those funds shall be made available to a
local public entity, or local public entities, designated by that
county's board of supervisors.
   (g) Funds appropriated for local assistance shall not be allocated
to the local public entity until the local public entity creates a
Pierce's disease work plan that is approved by the department.  Any
funds allocated by the department to a designated local public entity
shall be utilized for activities consistent with the local Pierce's
disease work plan or other programs or work plans approved by the
department.  It shall be the responsibility of the designated local
public entity to develop and implement the local Pierce's disease
work plan.  Upon request, the department shall provide consultation
to the local public entity regarding its work plan.
   (h) The work plan created by the designated local public entity
shall include, but is not limited to, all of the following:
   (1) In coordination with the department, the development and
delivery of producer outreach information and training to local
communities, groups, and individuals to organize their involvement
with the work plan and to raise awareness regarding Pierce's disease
and its vectors.
   (2) In coordination with the department, the development and
delivery of ongoing training of the designated local public entity's
employees in the biology, survey, and treatment of Pierce's disease
and its vectors.
   (3) The identification within the designated local public entity
of a local Pierce's disease coordinator.
   (4) The proposed treatment of Pierce's disease and its vectors.
Treatment programs shall comply with all applicable laws and
regulations and shall be conducted in an environmentally responsible
manner.
   (5) In coordination with the department, the development and
implementation of a data collection system to track and report new
infestations of Pierce's disease and its vectors in a manner
respectful of property and other rights of those affected.
   (6) On an annual basis, while funds appropriated by this section
are available for encumbrance, the department shall review the
progress of each local public entity's activities regarding Pierce's
disease and its vectors and, as needed, make recommendations
regarding those activities to the local public entity.
   (i) Notwithstanding Section 7550.5 of the Government Code, the
department shall report to the Legislature on January 1, 2001, and
each January 1 while this section is operative, regarding its
expenditures, progress, and ongoing priorities in combating Pierce's
disease and its vectors in California.
   (j) This article shall become inoperative on January 1, 2006, and
as of January 1, 2007, is repealed, unless a later enacted statute
that is enacted before January 1, 2007, deletes or extends the dates
on which it becomes inoperative and is repealed.
  SEC. 101.  Section 75131 of the Food and Agricultural Code is
amended to read:
   75131.  (a) The assessment on eggs and egg products shall be
established by the commission, with the approval of not less than
five handler members, prior to the beginning of each marketing season
and, except as provided in subdivision (c), shall not exceed one
cent ($0.01) per dozen for shell eggs, or the equivalent thereof, as
determined by the commission, for egg products.
   (b) The commission may establish an assessment rate that is
different for eggs than for egg products, so long as it does not
exceed the maximum assessment authorized in subdivision (a).
   (c) An assessment greater than the maximum specified in
subdivision (a) may be charged but only if it is approved by a vote
of the handlers as provided for in Section 75112.
  SEC. 102.  Section 3543.4 of the Government Code is amended to
read:
   3543.4.  A person serving in a management position, senior
management position, or a confidential position may not be
represented by an exclusive representative.  Any person serving in
such a position may represent himself or herself individually or by
an employee organization whose membership is composed entirely of
employees designated as holding those positions, in his or her
employment relationship with the public school employer, but, in no
case, shall such an organization meet and negotiate with the public
school employer.  A representative may not be permitted by a public
school employer to meet and negotiate on any benefit or compensation
paid to persons serving in a management position, senior management
position, or a confidential position.
  SEC. 103.  Section 3562.2 of the Government Code is amended to
read:
   3562.2.  Notwithstanding subdivision (r) of Section 3562, for
purposes of the California State University only, "scope of
representation" also means any retirement benefits available to a
state member under Part 3 (commencing with Section 20000) of Division
5 of Title 2.
  SEC. 104.  Section 3583.5 of the Government Code is amended to
read:
   3583.5.  (a) (1) Notwithstanding any other provision of law, any
employee of the California State University or the University of
California, other than a faculty member of the University of
California who is eligible for membership in the Academic Senate, who
is in a unit for which an exclusive representative has been selected
pursuant to this chapter, shall be required, as a condition of
continued employment, either to join the recognized employee
organization or to pay the organization a fair share service fee.
The amount of the fee shall not exceed the dues that are payable by
members of the employee organization, and shall cover the cost of
negotiation, contract administration, and other activities of the
employee organization that are germane to its functions as the
exclusive bargaining representative.  Upon notification to the
employer by the exclusive representative, the amount of the fee shall
be deducted by the employer from the wages or salary of the employee
and paid to the employee organization.
   (2) The costs covered by the fee under this section may include,
but shall not necessarily be limited to, the cost of lobbying
activities designed to foster collective bargaining negotiations and
contract administration, or to secure for the represented employees
advantages in wages, hours, and other conditions of employment in
addition to those secured through meeting and conferring with the
higher education employer.
   (b) The organizational security arrangement described in
subdivision (a) shall remain in effect unless it is rescinded
pursuant to subdivision (c).  The higher education employer shall
remain neutral, and shall not participate in any election conducted
under this section unless required to do so by the board.
   (c) (1) The organizational security arrangement described in
subdivision (a) may be rescinded by a majority vote of all the
employees in the negotiating unit subject to that arrangement, if a
request for a vote is supported by a petition containing the
signatures of at least 30 percent of the employees in the negotiating
unit, and the signatures are obtained in one academic year.  There
shall not be more than one vote taken during the term of any
memorandum of understanding in effect on or after January 1, 2000.
   (2) If the organizational security arrangement described in
subdivision (a) is rescinded pursuant to paragraph (1), a majority of
all the employees in the negotiating unit may request that the
arrangement be reinstated.  That request shall be submitted to the
board along with a petition containing the signatures of at least 30
percent of the employees in the negotiating unit.  The vote shall be
conducted at the worksite by secret ballot, and shall be conducted no
sooner than one year after the rescission of the organizational
security arrangement under this subdivision.
   (3) If the board determines that the appropriate number of
signatures have been collected, it shall conduct the vote to rescind
or reinstate in a manner that it shall prescribe in accordance with
this subdivision.
                          (4) The cost of conducting an election
under this subdivision to reinstate the organizational security
arrangement shall be borne by the petitioning party, and the cost of
conducting an election to rescind the arrangement shall be borne by
the board.
  SEC. 105.  Section 6254 of the Government Code is amended to read:

   6254.  Except as provided in Sections 6254.7 and 6254.13, nothing
in this chapter shall be construed to require disclosure of records
that are any of the following:
   (a) Preliminary drafts, notes, or interagency or intra-agency
memoranda that are not retained by the public agency in the ordinary
course of business, provided that the public interest in withholding
those records clearly outweighs the public interest in disclosure.
   (b) Records pertaining to pending litigation to which the public
agency is a party, or to claims made pursuant to Division 3.6
(commencing with Section 810), until the pending litigation or claim
has been finally adjudicated or otherwise settled.
   (c) Personnel, medical, or similar files, the disclosure of which
would constitute an unwarranted invasion of personal privacy.
   (d) Contained in or related to any of the following:
   (1) Applications filed with any state agency responsible for the
regulation or supervision of the issuance of securities or of
financial institutions, including, but not limited to, banks, savings
and loan associations, industrial loan companies, credit unions, and
insurance companies.
   (2) Examination, operating, or condition reports prepared by, on
behalf of, or for the use of, any state agency referred to in
paragraph (1).
   (3) Preliminary drafts, notes, or interagency or intra-agency
communications prepared by, on behalf of, or for the use of, any
state agency referred to in paragraph (1).
   (4) Information received in confidence by any state agency
referred to in paragraph (1).
   (e) Geological and geophysical data, plant production data, and
similar information relating to utility systems development, or
market or crop reports, that are obtained in confidence from any
person.
   (f) Records of complaints to, or investigations conducted by, or
records of intelligence information or security procedures of, the
office of the Attorney General and the Department of Justice, and any
state or local police agency, or any investigatory or security files
compiled by any other state or local police agency, or any
investigatory or security files compiled by any other state or local
agency for correctional, law enforcement, or licensing purposes,
except that state and local law enforcement agencies shall disclose
the names and addresses of persons involved in, or witnesses other
than confidential informants to, the incident, the description of any
property involved, the date, time, and location of the incident, all
diagrams, statements of the parties involved in the incident, the
statements of all witnesses, other than confidential informants, to
the victims of an incident, or an authorized representative thereof,
an insurance carrier against which a claim has been or might be made,
and any person suffering bodily injury or property damage or loss,
as the result of the incident caused by arson, burglary, fire,
explosion, larceny, robbery, carjacking, vandalism, vehicle theft, or
a crime as defined by subdivision (c) of Section 13960, unless the
disclosure would endanger the safety of a witness or other person
involved in the investigation, or unless disclosure would endanger
the successful completion of the investigation or a related
investigation.  However, nothing in this division shall require the
disclosure of that portion of those investigative files that reflect
the analysis or conclusions of the investigating officer.
   Notwithstanding any other provision of this subdivision, state and
local law enforcement agencies shall make public the following
information, except to the extent that disclosure of a particular
item of information would endanger the safety of a person involved in
an investigation or would endanger the successful completion of the
investigation or a related investigation:
   (1) The full name and occupation of every individual arrested by
the agency, the individual's physical description including date of
birth, color of eyes and hair, sex, height and weight, the time and
date of arrest, the time and date of booking, the location of the
arrest, the factual circumstances surrounding the arrest, the amount
of bail set, the time and manner of release or the location where the
individual is currently being held, and all charges the individual
is being held upon, including any outstanding warrants from other
jurisdictions and parole or probation holds.
   (2) Subject to the restrictions imposed by Section 841.5 of the
Penal Code, the time, substance, and location of all complaints or
requests for assistance received by the agency and the time and
nature of the response thereto, including, to the extent the
information regarding crimes alleged or committed or any other
incident investigated is recorded, the time, date, and location of
occurrence, the time and date of the report, the name and age of the
victim, the factual circumstances surrounding the crime or incident,
and a general description of any injuries, property, or weapons
involved.  The name of a victim of any crime defined by Section 220,
261, 261.5, 262, 264, 264.1, 273a, 273d, 273.5, 286, 288, 288a, 289,
422.6, 422.7, 422.75, or 646.9 of the Penal Code may be withheld at
the victim's request, or at the request of the victim's parent or
guardian if the victim is a minor.  When a person is the victim of
more than one crime, information disclosing that the person is a
victim of a crime defined by Section 220, 261, 261.5, 262, 264,
264.1, 273a, 273d, 286, 288, 288a, 289, 422.6, 422.7, 422.75, or
646.9 of the Penal Code may be deleted at the request of the victim,
or the victim's parent or guardian if the victim is a minor, in
making the report of the crime, or of any crime or incident
accompanying the crime, available to the public in compliance with
the requirements of this paragraph.
   (3) Subject to the restrictions of Section 841.5 of the Penal Code
and this subdivision, the current address of every individual
arrested by the agency and the current address of the victim of a
crime, where the requester declares under penalty of perjury that the
request is made for a scholarly, journalistic, political, or
governmental purpose, or that the request is made for investigation
purposes by a licensed private investigator as described in Chapter
11.3 (commencing with Section 7512) of Division 3 of the Business and
Professions Code, except that the address of the victim of any crime
defined by Section 220, 261, 261.5, 262, 264, 264.1, 273a, 273d,
273.5, 286, 288, 288a, 289, 422.6, 422.7, 422.75, or 646.9 of the
Penal Code shall remain confidential.  Address information obtained
pursuant to this paragraph shall not be used directly or indirectly
to sell a product or service to any individual or group of
individuals, and the requester shall execute a declaration to that
effect under penalty of perjury.
   (g) Test questions, scoring keys, and other examination data used
to administer a licensing examination, examination for employment, or
academic examination, except as provided for in Chapter 3
(commencing with Section 99150) of Part 65 of the Education Code.
   (h) The contents of real estate appraisals or engineering or
feasibility estimates and evaluations made for or by the state or
local agency relative to the acquisition of property, or to
prospective public supply and construction contracts, until all of
the property has been acquired or all of the contract agreement
obtained.  However, the law of eminent domain shall not be affected
by this provision.
   (i) Information required from any taxpayer in connection with the
collection of local taxes that is received in confidence and the
disclosure of the information to other persons would result in unfair
competitive disadvantage to the person supplying the information.
   (j) Library circulation records kept for the purpose of
identifying the borrower of items available in libraries, and library
and museum materials made or acquired and presented solely for
reference or exhibition purposes.  The exemption in this subdivision
shall not apply to records of fines imposed on the borrowers.
   (k) Records the disclosure of which is exempted or prohibited
pursuant to federal or state law, including, but not limited to,
provisions of the Evidence Code relating to privilege.
   (l) Correspondence of and to the Governor or employees of the
Governor's office or in the custody of or maintained by the Governor'
s legal affairs secretary, provided that public records shall not be
transferred to the custody of the Governor's Legal Affairs Secretary
to evade the disclosure provisions of this chapter.
   (m) In the custody of or maintained by the Legislative Counsel,
except those records in the public data base maintained by the
Legislative Counsel that are described in Section 10248.
   (n) Statements of personal worth or personal financial data
required by a licensing agency and filed by an applicant with the
licensing agency to establish his or her personal qualification for
the license, certificate, or permit applied for.
   (o) Financial data contained in applications for financing under
Division 27 (commencing with Section 44500) of the Health and Safety
Code, where an authorized officer of the California Pollution Control
Financing Authority determines that disclosure of the financial data
would be competitively injurious to the applicant and the data is
required in order to obtain guarantees from the United States Small
Business Administration.  The California Pollution Control Financing
Authority shall adopt rules for review of individual requests for
confidentiality under this section and for making available to the
public those portions of an application that are subject to
disclosure under this chapter.
   (p) Records of state agencies related to activities governed by
Chapter 10.3 (commencing with Section 3512), Chapter 10.5 (commencing
with Section 3525), and Chapter 12 (commencing with Section 3560) of
Division 4 of Title 1, that reveal a state agency's deliberative
processes, impressions, evaluations, opinions, recommendations,
meeting minutes, research, work products, theories, or strategy, or
that provide instruction, advice, or training to employees who do not
have full collective bargaining and representation rights under
these chapters.  Nothing in this subdivision shall be construed to
limit the disclosure duties of a state agency with respect to any
other records relating to the activities governed by the employee
relations acts referred to in this subdivision.
   (q) Records of state agencies related to activities governed by
Article 2.6 (commencing with Section 14081), Article 2.8 (commencing
with Section 14087.5), and Article 2.91 (commencing with Section
14089) of Chapter 7 of Part 3 of Division 9 of the Welfare and
Institutions Code, that reveal the special negotiator's deliberative
processes, discussions, communications, or any other portion of the
negotiations with providers of health care services, impressions,
opinions, recommendations, meeting minutes, research, work product,
theories, or strategy, or that provide instruction, advice, or
training to employees.
   Except for the portion of a contract containing the rates of
payment, contracts for inpatient services entered into pursuant to
these articles, on or after April 1, 1984, shall be open to
inspection one year after they are fully executed.  In the event that
a contract for inpatient services that is entered into prior to
April 1, 1984, is amended on or after April 1, 1984, the amendment,
except for any portion containing the rates of payment, shall be open
to inspection one year after it is fully executed.  If the
California Medical Assistance Commission enters into contracts with
health care providers for other than inpatient hospital services,
those contracts shall be open to inspection one year after they are
fully executed.
   Three years after a contract or amendment is open to inspection
under this subdivision, the portion of the contract or amendment
containing the rates of payment shall be open to inspection.
   Notwithstanding any other provision of law, the entire contract or
amendment shall be open to inspection by the Joint Legislative Audit
Committee.  The committee shall maintain the confidentiality of the
contracts and amendments until the time a contract or amendment is
fully open to inspection by the public.
   (r) Records of Native American graves, cemeteries, and sacred
places maintained by the Native American Heritage Commission.
   (s) A final accreditation report of the Joint Commission on
Accreditation of Hospitals that has been transmitted to the State
Department of Health Services pursuant to subdivision (b) of Section
1282 of the Health and Safety Code.
   (t) Records of a local hospital district, formed pursuant to
Division 23 (commencing with Section 32000) of the Health and Safety
Code, or the records of a municipal hospital, formed pursuant to
Article 7 (commencing with Section 37600) or Article 8 (commencing
with Section 37650) of Chapter 5 of Division 3 of Title 4 of this
code, that relate to any contract with an insurer or nonprofit
hospital service plan for inpatient or outpatient services for
alternative rates pursuant to Section 10133 or 11512 of the Insurance
Code.  However, the record shall be open to inspection within one
year after the contract is fully executed.
   (u) (1) Information contained in applications for licenses to
carry firearms issued pursuant to Section 12050 of the Penal Code by
the sheriff of a county or the chief or other head of a municipal
police department that indicates when or where the applicant is
vulnerable to attack or that concerns the applicant's medical or
psychological history or that of members of his or her family.
   (2) The home address and telephone number of peace officers,
judges, court commissioners, and magistrates that are set forth in
applications for licenses to carry firearms issued pursuant to
Section 12050 of the Penal Code by the sheriff of a county or the
chief or other head of a municipal police department.
   (3) The home address and telephone number of peace officers,
judges, court commissioners, and magistrates that are set forth in
licenses to carry firearms issued pursuant to Section 12050 of the
Penal Code by the sheriff of a county or the chief or other head of a
municipal police department.
   (v) (1) Records of the Major Risk Medical Insurance Program
related to activities governed by Part 6.3 (commencing with Section
12695) and Part 6.5 (commencing with Section 12700) of Division 2 of
the Insurance Code, and that reveal the deliberative processes,
discussions, communications, or any other portion of the negotiations
with health plans, or the impressions, opinions, recommendations,
meeting minutes, research, work product, theories, or strategy of the
board or its staff, or records that provide instructions, advice, or
training to employees.
   (2) (A) Except for the portion of a contract that contains the
rates of payment, contracts for health coverage entered into pursuant
to Part 6.3 (commencing with Section 12695) or Part 6.5 (commencing
with Section 12700) of Division 2 of the Insurance Code, on or after
July 1, 1991, shall be open to inspection one year after they have
been fully executed.
   (B) In the event that a contract for health coverage that is
entered into prior to July 1, 1991, is amended on or after July 1,
1991, the amendment, except for any portion containing the rates of
payment, shall be open to inspection one year after the amendment has
been fully executed.
   (3) Three years after a contract or amendment is open to
inspection pursuant to this subdivision, the portion of the contract
or amendment containing the rates of payment shall be open to
inspection.
   (4) Notwithstanding any other provision of law, the entire
contract or amendments to a contract shall be open to inspection by
the Joint Legislative Audit Committee.  The committee shall maintain
the confidentiality of the contracts and amendments thereto, until
the contract or amendments to a contract is open to inspection
pursuant to paragraph (3).
   (w) (1) Records of the Major Risk Medical Insurance Program
related to activities governed by Chapter 14 (commencing with Section
10700) of Part 2 of Division 2 of the Insurance Code, and that
reveal the deliberative processes, discussions, communications, or
any other portion of the negotiations with health plans, or the
impressions, opinions, recommendations, meeting minutes, research,
work product, theories, or strategy of the board or its staff, or
records that provide instructions, advice, or training to employees.

   (2) Except for the portion of a contract that contains the rates
of payment, contracts for health coverage entered into pursuant to
Chapter 14 (commencing with Section 10700) of Part 2 of Division 2 of
the Insurance Code, on or after January 1, 1993, shall be open to
inspection one year after they have been fully executed.
   (3) Notwithstanding any other provision of law, the entire
contract or amendments to a contract shall be open to inspection by
the Joint Legislative Audit Committee.  The committee shall maintain
the confidentiality of the contracts and amendments thereto, until
the contract or amendments to a contract is open to inspection
pursuant to paragraph (2).
   (x) Financial data contained in applications for registration, or
registration renewal, as a service contractor filed with the Director
of the Department of Consumer Affairs pursuant to Chapter 20
(commencing with Section 9800) of Division 3 of the Business and
Professions Code, for the purpose of establishing the service
contractor's net worth, or financial data regarding the funded
accounts held in escrow for service contracts held in force in this
state by a service contractor.
   (y) (1) Records of the Managed Risk Medical Insurance Board
related to activities governed by Part 6.2 (commencing with Section
12693) of Division 2 of the Insurance Code, and that reveal the
deliberative processes, discussions, communications, or any other
portion of the negotiations with health plans, or the impressions,
opinions, recommendations, meeting minutes, research, work product,
theories, or strategy of the board or its staff, or records that
provide instructions, advice, or training to employees.
   (2) (A) Except for the portion of a contract that contains the
rates of payment, contracts entered into pursuant to Part 6.2
(commencing with Section 12693) of Division 2 of the Insurance Code,
on or after January 1, 1998, shall be open to inspection one year
after they have been fully executed.
   (B) In the event that a contract entered into pursuant to Part 6.2
(commencing with Section 12693) of Division 2 of the Insurance Code
is amended, the amendment shall be open to inspection one year after
the amendment has been fully executed.
   (3) Three years after a contract or amendment is open to
inspection pursuant to this subdivision, the portion of the contract
or amendment containing the rates of payment shall be open to
inspection.
   (4) Notwithstanding any other provision of law, the entire
contract or amendments to a contract shall be open to inspection by
the Joint Legislative Audit Committee.  The committee shall maintain
the confidentiality of the contracts and amendments thereto until the
contract or amendments to a contract are open to inspection pursuant
to paragraph (2) or (3).
   (z) Records obtained pursuant to paragraph (2) of subdivision (c)
of Section 2891.1 of the Public Utilities Code.
   Nothing in this section prevents any agency from opening its
records concerning the administration of the agency to public
inspection, unless disclosure is otherwise prohibited by law.
   Nothing in this section prevents any health facility from
disclosing to a certified bargaining agent relevant financing
information pursuant to Section 8 of the National Labor Relations
Act.
  SEC. 106.  Section 6516.6 of the Government Code is amended to
read:
   6516.6.  (a) Notwithstanding any other provision of law, a joint
powers agency established pursuant to a joint powers agreement in
accordance with this chapter may issue bonds pursuant to Article 2
(commencing with Section 6540) or Article 4 (commencing with Section
6584), in order to purchase obligations of local agencies or make
loans to local agencies, which moneys the local agencies are hereby
authorized to borrow, to finance the local agencies' unfunded
actuarial pension liability or to purchase, or to make loans to
finance the purchase of, delinquent assessments or taxes levied on
the secured roll by the local agencies, the county, or any other
political subdivision of the state.  Notwithstanding any other
provision of law, including Section 53854, the local agency
obligations or loans, if any, shall be repaid in the time, manner and
amounts, with interest, security, and other terms as agreed to by
the local agency and the joint powers authority.
   (b) Notwithstanding any other provision of law, a joint powers
authority established pursuant to a joint powers agreement in
accordance with this chapter may issue bonds pursuant to Article 2
(commencing with Section 6540) or Article 4 (commencing with Section
6584), in order to purchase or acquire, by sale, assignment, pledge,
or other transfer, any or all right, title, and interest of any local
agency in and to the enforcement and collection of delinquent and
uncollected property taxes, assessments, and other receivables that
have been levied by or on behalf of the local agency and placed for
collection on the secured, unsecured, or supplemental property tax
rolls.  Local agencies, including, cities, counties, cities and
counties, school districts, redevelopment agencies, and all other
special districts that are authorized by law to levy property taxes
on the county tax rolls, are hereby authorized to sell, assign,
pledge, or otherwise transfer to a joint powers authority any or all
of their right, title, and interest in and to the enforcement and
collection of delinquent and uncollected property taxes, assessments,
and other receivables that have been levied by or on behalf of the
local agency for collection on the secured, unsecured, or
supplemental property tax rolls in accordance with the terms and
conditions that may be set forth in an agreement with a joint powers
authority.
   (c) Notwithstanding Division 1 (commencing with Section 50) of the
Revenue and Taxation Code, upon any transfer authorized in
subdivision (b), the following shall apply:
   (1) A local agency shall be entitled to timely payment of all
delinquent taxes, assessments, and other receivables collected on its
behalf on the secured, unsecured, and supplemental tax rolls, along
with all penalties, interest, costs, and other charges thereon, no
later than 30 calendar days after the close of the preceding monthly
or four week accounting period during which the delinquencies were
paid by or on account of any property owner.
   (2) Upon its receipt of the delinquent taxes, assessments, and
receivables that it had agreed to be transferred, a local agency
shall pay those amounts, along with all applicable penalties,
interest, costs, and other charges, to the joint powers authority in
accordance with the terms and conditions that may be agreed to by the
local agency and the joint powers authority.
   (3) The joint powers authority shall be entitled to assert all
right, title, and interest of the local agency in the enforcement and
collection of the delinquent taxes, assessments, and receivables,
including without limitation, its lien priority, its right to receive
the proceeds of delinquent taxes, assessments, and receivables, and
its right to receive all penalties, interest, administrative costs,
and any other charges, including attorney fees and costs, if
otherwise authorized by law to be collected by the local agency.
   (4) (A) For any school district that participates in a joint
powers authority using financing authorized by this section and that
does not participate in the alternative method of distribution of tax
levies under Chapter 3 of Division 1 of Part 8 of the Revenue and
Taxation Code, the amount of property tax receipts to be reported in
a fiscal year for the district under subdivision (f) of Section 75.70
of the Revenue and Taxation Code, or any other similar law requiring
reporting of school district property tax receipts, shall be equal
to 100 percent of the school district's allocable share of the taxes
levied for the fiscal year on its behalf.  One hundred percent of the
school district's allocable share of the delinquent taxes levied for
the fiscal year, whether or not the delinquent taxes are ever
collected, shall be paid by the joint powers authority to the county
auditor and shall be distributed to the school district by the county
auditor in the same time and manner otherwise specified for the
distribution of tax revenues generally to school districts pursuant
to current law.  Any additional amounts shall not be so reported and
may be provided directly to a school district by a joint powers
authority.
   (B) A joint powers authority financing delinquent school district
taxes and related penalties pursuant to this subdivision shall be
solely responsible for, and shall pay directly to the county, all
reasonable and identifiable administrative costs and expenses of the
county which are incurred as a direct result of the compliance of the
county tax collector or county auditor, or both, with any new or
additional administrative procedures required for the county to
comply with this subdivision.  Where reasonably possible, the county
shall provide a joint powers authority with an estimate of the amount
of and basis for any additional administrative costs and expenses
within a reasonable time after written request for an estimate.
   (C) In no event shall the state be responsible or liable for a
joint powers authority's failure to actually pay the amounts required
by subparagraphs (A) and (B), nor shall a failure constitute a basis
for a claim against the state by a school district, county, or joint
powers authority.
   (D) The phrase "school district," as used in this section,
includes all school districts of every kind or class, including,
without limitation, community college districts and county
superintendents of schools.
                     (d) The powers conferred by this section upon
joint powers authorities and local agencies shall be complete,
additional, and cumulative to all other powers conferred upon them by
law.  Except as otherwise required by this section, the agreements
authorized by this section need not comply with the requirements of
any other laws applicable to the same subject matter.
   (e) An action to determine the validity of any bonds issued, any
joint powers agreements entered into, any related agreements,
including, without limitation, any bond indenture or any agreements
relating to the sale, assignment, or pledge entered into by a joint
powers authority or a local agency, the priority of any lien
transferred in accordance with this section, and the respective
rights and obligations of any joint powers authority and any party
with whom the joint powers authority may contract pursuant to this
chapter, may be brought by the joint powers authority pursuant to
Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the
Code of Civil Procedure.  Any appeal from a judgment in the action
shall be commenced within 30 days after entry of judgment.
   (f) This section shall not be construed to affect the manner in
which an agency participates in or withdraws from the alternative
distribution method established by Chapter 3 (commencing with Section
4701) of Part 8 of Division 1 of the Revenue and Taxation Code.
  SEC. 107.  Section 6599.2 of the Government Code is amended to
read:
   6599.2.  Notwithstanding Sections 863 and 869 of the Code of Civil
Procedure, the Attorney General or the Treasurer may jointly or
separately file an action pursuant to Chapter 9 (commencing with
Section 860) of Title 10 of Part 2 of the Code of Civil Procedure at
any time up to 55 days after notice required by Section 6586.7 is
mailed by certified mail to the Sacramento offices of both the
Attorney General and the Treasurer.
  SEC. 108.  Section 7074 of the Government Code is amended to read:

   7074.  (a) In the case of any enterprise zone, including an
enterprise zone formerly designated as an enterprise zone pursuant to
Chapter 12.8 (commencing with Section 7070) as it read prior to
January 1, 1997, or as a program area pursuant to Chapter 12.9
(commencing with Section 7080) as it read prior to January 1, 1997, a
city or county, or city and county may propose that the enterprise
zone be expanded by 15 percent to include definitive boundaries that
are contiguous to the enterprise zone.
   (b) The agency may approve an enterprise zone expansion proposed
pursuant to this section based on the following criteria:
   (1) Each of the adjacent jurisdictions' governing bodies approves
the expansion by adoption of an ordinance or resolution.
   (2) Land included within the proposed expansion is zoned for
industrial or commercial use.
   (3) Basic infrastructure, including, but not limited to, gas,
water, electrical service, and sewer systems, is available to the
area that would be included in the expansion.
   (c) An enterprise zone may propose to use an eligible expansion
allotment to expand into an adjacent jurisdiction pursuant to this
section if the agency finds that all of the following conditions
exist:
   (1) The governing body of the local agency with jurisdiction over
the existing enterprise zone and the governing body of the local
agency with jurisdiction over the proposed expansion area each
approve the expansion by adoption of an ordinance or resolution.  The
ordinance or resolution by the jurisdiction containing the proposed
expansion area shall indicate that the jurisdiction will provide the
same or equivalent local incentives as provided by the jurisdiction
of the existing enterprise zone.
   (2) (A) Land included within the proposed expansion is zoned for
industrial or commercial use.
   (B) An expansion area may contain noncommercial or nonindustrial
land only if that land is a right-of-way and is needed to meet the
requirement for a contiguous expansion between an existing enterprise
zone and a proposed expansion area.
   (3) Basic infrastructure, including, but not limited to, gas,
water, electrical service, and sewer systems, is available to the
area that would be included in the expansion.
   (4) The expansion area is contiguous to the existing enterprise
zone.
   (d) (1) Except as otherwise provided in paragraph (2), in no event
shall an enterprise zone be permitted to expand more than 15 percent
in size from its size on the date of original designation, including
any expansion authorized pursuant to Chapter 12.8 (commencing with
Section 7070), or Chapter 12.9 (commencing with Section 7080), as
those chapters read prior to January 1, 1997.
   (2) If an enterprise zone, on the date of original designation, is
no greater than 13 square miles, it may be permitted to expand up to
20 percent in size from its size on the date of original
designation.
  SEC. 109.  Section 18935 of the Government Code is amended to read:

   18935.  The board may refuse to examine or, after examination, may
refuse to declare as eligible or may withhold or withdraw from
certification, prior to appointment, anyone who comes under any of
the following categories:
   (a) Lacks any of the requirements established by the board for the
examination or position for which he or she applies.
   (b) At the time of examination has permanent status in a position
of equal or higher class than the examination or position for which
he or she applies.
   (c) Is physically or mentally so disabled as to be rendered unfit
to perform the duties of the position to which he or she seeks
appointment.
   (d) Is addicted to the use of intoxicating beverages to excess.
   (e) Is addicted to the use of controlled substances.
   (f) Has been convicted of a felony, or convicted of a misdemeanor
involving moral turpitude.
   (g) Has been guilty of infamous or notoriously disgraceful
conduct.
   (h) Has been dismissed from any position for any cause which would
be a cause for dismissal from the state service.
   (i) Has resigned from any position not in good standing or in
order to avoid dismissal.
   (j) Has intentionally attempted to practice any deception or fraud
in his or her application, in his or her examination, or in securing
his or her eligibility.
   (k) Has waived appointment three times after certification from
the same employment list.
   (l) Has failed to reply within a reasonable time, as specified by
the board, to communications concerning his or her availability for
employment.
   (m) Has made himself or herself unavailable for employment by
requesting that his or her name be withheld from certification.
   (n) Is, in accordance with board rule, found to be unsuited or not
qualified for employment.
   (o) Has engaged in unlawful reprisal or retaliation in violation
of Article 3 (commencing with Section 8547) of Chapter 6.5 of
Division 1, as determined by the board or the court.
  SEC. 110.  Section 20028 of the Government Code is amended to read:

   20028.  "Employee" means all of the following:
   (a) Any person in the employ of the state, a county superintendent
of schools, or the university whose compensation, or at least that
portion of his or her compensation that is provided by the state, a
county superintendent of schools, or the university, is paid out of
funds directly controlled by the state, a county superintendent of
schools, or the university, excluding all other political
subdivisions, municipal, public and quasi-public corporations.
"Funds directly controlled by the state" includes funds deposited in
and disbursed from the State Treasury in payment of compensation,
regardless of their source.
   (b) Any person in the employ of any contracting agency.
   (c) City employees who prior to the effective date of the contract
with the hospital are assigned to a hospital that became a
contracting agency because of subdivision (p) of Section 20057 shall
be deemed hospital employees from and after the effective date of the
contract with the hospital for retirement purposes.  City employees
who after the effective date of the contract with the hospital become
employed by the hospital, shall be considered as new employees of
the hospital for retirement purposes.
   (d) Any person in the employ of a school employer.
   (e) Public health department or district employees who were
employees prior to the date of assumption of the contract by the
governing body of a county of the 15th class shall be deemed public
health department or district employees from and after the effective
date of assumption of the contract for retirement purposes.
Employees who after the effective date of assumption of the contract
become employed by the public health department or district shall be
considered as new employees for retirement purposes.
  SEC. 111.  Section 20300 of the Government Code is amended to read:

   20300.  The following persons are excluded from membership in this
system:
   (a) Inmates of state or public agency institutions who are allowed
compensation for the service they are able to perform.
   (b) Independent contractors who are not employees.
   (c) Persons employed as student assistants in the state colleges
and persons employed as student aides in the special schools of the
State Department of Education and in the public schools of the state.

   (d) Persons employed as teacher-assistants pursuant to Section
44926 of the Education Code.
   (e) Participants, other than staff officers and employees, in the
California Conservation Corps.
   (f) Persons employed as participants in a program of, and whose
wages are paid in whole or in part by federal funds in accordance
with, Section 1501 et seq. of Title 29 of the United States Code.
This subdivision does not apply with respect to persons employed in
job classes that provide eligibility for patrol or safety membership
or to the career staff employees of an employer.
   (g) All persons who are members in any teachers' retirement
system, as to the service in which they are members of any teachers'
retirement system.
   (h) Except as otherwise provided in this part, persons rendering
professional legal services to a city, other than the person holding
the office of city attorney, the office of assistant city attorney,
or an established position of deputy city attorney.
   (i) A person serving the university as a teacher in university
extension, whose compensation for that service is established on the
basis of class enrollment, either actual or estimated, with respect
to that service.
   (j) A person serving a California State University as a teacher in
extension service, whose compensation for that service is
established on the basis of class enrollment, either actual or
estimated, with respect to that service.
   (k) A teacher or academic employee of the university or any
California State University who is otherwise fully employed and who
serves as a teacher or in an academic capacity in any summer session
or intersession, for which he or she receives compensation
specifically attributable to that service in summer session or
intersession, with respect to that service.
   (l) A person who is employed under the Senate Fellows, the
Assembly Fellows, or the Executive Fellows programs.
  SEC. 112.  Section 20392 of the Government Code is amended to read:

   20392.  "State peace officer/firefighter member" also includes
officers and employees with the following class titles:


Class
Code                         Classification
6875                Air Operations Officer I
1056                Air Operations Officer II
1053                Air Operations Officer III
6877                Air Operations Officer I (Maintenance)
6882                Air Operations Officer II (Maintenance)
1050                Air Operations Officer III (Maintenance)
8997                Arson and Bomb Investigator
9694                Board Coordinating Parole Agent, Youthful
Offender
                    Parole Board
9904                Correctional Counselor I
9903                Correctional Counselor II
9662                Correctional Officer
9911                Case Work Specialist, Youth Authority
9013                Deputy State Fire Marshal III (Specialist)
9086                Deputy State Fire Marshal
9010                Deputy State Fire Marshal III (Supervisor)
1077                Fire Apparatus Engineer
1095                Fire Captain
1072                Fire Control Aid
8979                Firefighter
1083                Firefighter I
1082                Firefighter II
9001                Firefighter (Correctional Institution)
8990                Firefighter/Security Officer
1047                Fire Prevention Officer I
1049                Fire Prevention Officer II
9090                Fire Service Training Specialist III
8418                Fish and Game Patrol, Lieutenant
8421                Fish and Game Warden, Department of Fish and Game

9039                Senior Food and Drug Investigator
9028                Food and Drug Program Specialist
9007                Food Technology Specialist
1060                Forestry Aid
1046                Forestry Pilot (Helicopter)
9579                Group Supervisor/Youth Correctional Officer
9578                Group Supervisor Trainee
6387                Heavy Fire Equipment Operator
1937                Hospital Peace Officer I
8416                Lieutenant Fish and Game Patrol Boat
0992                Lifeguard
8217                Medical Technical Assistant, Correctional
Facility
1992                Museum Security Officer I
9701                Parole Agent I, Youth Authority
9765                Parole Agent I, Adult Parole
9696                Parole Agent II, Youth Authority (Specialist)
9763                Parole Agent II, Adult Parole (Supervisor)
9762                Parole Agent II, Adult Parole (Specialist)
8215                Senior Medical Technical Assistant
8359                Sergeant, California State Police
8980                State Fire Marshal Trainee
9723                State Forest Ranger I (Nonsupervisory)
9724                State Forest Ranger II (Nonsupervisory)
0983                State Park Ranger I
8464                State Police Officer
8358                State Security Officer
8989                Captain Firefighter/Security Officer
8410                Warden-Pilot Department of Fish and Game
9581                Youth Counselor/Youth Correctional Counselor

   A member who is employed in a position that is reclassified to
state peace officer/firefighter pursuant to this section may make an
irrevocable election in writing to remain subject to the service
retirement benefit and the normal rate of contribution applicable
prior to reclassification by filing a notice of the election with the
board within 90 days after notification by the board.  A member who
so elects shall be subject to the reduced benefit factors specified
in Section 21353 or 21354.1, as applicable, only for service also
included in the federal system.
  SEC. 113.  Section 21006 of the Government Code is amended to read:

   21006.  (a) "Leave of absence" also means any time during which a
state member was excused from performance of his or her duties on
approved leave for the purpose of further education.  Any member
electing to receive service credit for that leave of absence shall
make the contributions as specified in Sections 21050 and 21052.
However, any eligible member who applies to make that election
between January 1, 2001, and December 31, 2003, may, instead of
making those contributions, make the payment calculated under this
article as it read on December 31, 2000, which payment shall be made
in the manner described in Section 21050.
   (b) Credit granted under this section may not exceed two years.
   (c) This section shall be applicable to persons who are members or
became members of this system on and after January 1, 1975.
  SEC. 114.  Section 21547.7 of the Government Code is amended to
read:
   21547.7.  (a) Notwithstanding any other provision of this article
requiring attainment of the minimum age for voluntary service
retirement applicable to him or her in his or her last employment
preceding death, upon the death of a local firefighter member while
in the employ of an agency subject to this section on or after
January 1, 2001, who is credited with 20 years or more of state
service, the surviving spouse, or eligible children, if there is no
eligible spouse, may receive a monthly allowance in lieu of the basic
death benefit.  The board shall notify the eligible survivor, as
defined in Section 21546, of this alternate death benefit.  The board
shall calculate the monthly allowance that shall be payable as
follows:
   (1) To the member's surviving spouse, an amount equal to the
amount the member would have received if he or she had retired for
service at the minimum retirement age on the date of death and had
elected optional settlement 2 and Section 21459.  The retirement
allowance shall be calculated using all service earned by the member
in this system.
   (2) If there is no surviving spouse or the spouse dies before all
of the children of the deceased member attain the age of 18 years, to
the surviving children, under the age of 18 years, collectively, an
amount equal to one-half of, and derived from the same source as, the
unmodified allowance the member would have received if he or she had
retired for service at the minimum retirement age on the date of
death.  No child shall receive any allowance after marrying or
attaining the age of 18 years.  As used in this paragraph, "surviving
children" includes a posthumously born child or children of the
member.  The retirement allowance shall be calculated using all
service earned by the member in this system.
   (3) The cost of the allowance paid pursuant to this subdivision
shall be paid from the assets of the employer at the member's date of
death.  All member contributions made by the member to this system
shall be transferred to the plan assets of the employer liable for
the funding of this benefit.
   (b) (1) Upon the death of a local firefighter member while in the
employ of an agency subject to this section on or after January 1,
2001, who is credited with 20 years or more of state service and who
has attained the minimum age for voluntary service retirement
applicable to him or her in his or her last employment preceding
death, the surviving spouse, or eligible children, if there is no
eligible spouse, may elect to receive a monthly allowance that is
equal to the amount that member would have received if the member had
been retired from service on the date of death and had elected
optional settlement 2 and Section 21459 in lieu of the basic death
benefit.  The retirement allowance will be calculated using all
service earned by the member in this system.
   (2) If there is no surviving spouse or the spouse dies before all
of the children of the deceased member attain the age of 18 years,
the allowance shall continue to the surviving children, under the age
of 18 years, collectively, in an amount equal to one-half of, and
derived from the same source as, the unmodified allowance the member
would have received if he or she had been retired from service on the
date of death.  No child shall receive any allowance after marrying
or attaining the age of 18 years.  As used in this paragraph,
"surviving children" includes a posthumously born child or children
of the member.  The retirement allowance will be calculated using all
service earned by the member in this system.
   (3) The cost of the increase in service allowance paid pursuant to
this subdivision shall be paid from the assets of the employer at
the member's date of death.
   (c)  This section shall not apply to any contracting agency, nor
to the employees of any contracting agency, unless and until the
agency elects to be subject to this section by amendment to its
contract made in the manner prescribed for approval of contracts,
except that an election among the employees is not required.
  SEC. 115.  Section 30064.1 of the Government Code is amended to
read:
   30064.1.  This chapter shall become inoperative on July 1, 2002,
and, as of January 1, 2003, is repealed, unless a later enacted
statute that is enacted before January 1, 2003, deletes or extends
the dates on which it becomes inoperative and is repealed.
  SEC. 116.  Section 31461.3 of the Government Code is amended to
read:
   31461.3.  (a) The average compensation during any period of
service as a member of the Public Employees' Retirement System, a
member of a retirement system established under this chapter in
another county, a member of the State Teachers' Retirement System, or
a member of a retirement system of any other public agency of the
state that has established reciprocity with the Public Employees'
Retirement System subject to the conditions of Section 31840.2 shall
be considered compensation earnable by a member for purposes of
computing final compensation for that member provided:
   (1) The period intervening between active memberships in the
respective systems does not exceed 90 days, or six months if Section
31840.4 applies.
   (2) He or she retires concurrently under both systems and is
credited with that period of service under the other system at the
time of retirement.
   (b) This section shall be applied retroactively under this chapter
in favor of any member whose membership in the Public Employees'
Retirement System or in a retirement system established under this
chapter in any county terminated prior to October 1, 1957, provided
that he or she was eligible to and elected deferred retirement
therein within 90 days after eligibility for reciprocity, the period
intervening between active memberships in the respective systems did
not exceed 90 days, or six months if Section 31840.4 applies, and he
or she retires concurrently under both systems and is credited with
that period of service under the other system at the time of
retirement.  The limitation of the 90-day or six-month period between
the active membership in the two retirement systems shall not apply
to an employee who entered the employment in which he or she became a
member of the State Employees' Retirement System prior to July 18,
1961; provided he or she entered that employment within 90 days, or
six months if Section 31840.4 applies , after the termination of
employment in the county system, whether that employment is with the
state or with a county, a city, or other public agency that contracts
with the Public Employees' Retirement System, the State Teachers'
Retirement System, or a retirement system of any other public agency
of the state that has established reciprocity with the Public
Employees' Retirement System subject to the conditions of Section
31840.2.
  SEC. 117.  Section 31681.55 of the Government Code is amended to
read:
   31681.55.  Effective the first day of the first month after
adoption of this section by the board of supervisors, the allowance
paid with respect to any member of this system who retired or died
prior to January 1, 2001, shall be increased by the percentage set
forth opposite the year of retirement or death in the following
schedule:


    Period during which retirement
    or death occurred:                       Percentage:
    January 1, 1998, or later                    0.0%
    12 months ending Dec. 31, 1997               1.0%
    24 months ending Dec. 31, 1996               2.0%
    60 months ending Dec. 31, 1994               3.0%
    60 months ending Dec. 31, 1989               4.0%
    120 months ending Dec. 31, 1984              5.0%
    12 months ending Dec. 31, 1974,
    or earlier                                   6.0%

   The percentage shall be applied to the allowance payable on the
effective date, and the allowance as so increased shall be paid for
time on and after that date and shall be subject to annual
cost-of-living adjustments.
   (b) This section shall not be operative in any county until such
time as the board of supervisors shall, by resolution adopted by
majority vote, make the provisions of this section applicable in that
county.
  SEC. 118.  Section 31835.02 of the Government Code is amended to
read:
   31835.02.  Notwithstanding any other provision of this part,
Section 31835 shall also apply to any member who was a member of a
retirement system established under this chapter and who subsequently
becomes a member of the Public Employees' Retirement System, a
retirement system established under this chapter in another county,
the State Teachers' Retirement System, or a retirement system of any
other public agency of the state that has established reciprocity
with the Public Employees' Retirement System subject to the
conditions of Section 31840.2, providing the period intervening
between the periods for which active service was credited does not
exceed 90 days, or six months if Section 31840.2 applies, and the
member retires concurrently under both systems and is credited with
the periods of service at the time of retirement.
   This section shall only be operative in any county of the fourth
class as described in Sections 28020 and 28025 if it is adopted by a
majority vote of the board of supervisors.
  SEC. 119.  Section 38773.6 of the Government Code is amended to
read:
   38773.6.  (a) As an alternative to the procedure specified in
Section 38773.2, the legislative body of a city, county, or city and
county may, by ordinance, establish a procedure for the abatement of
any nuisance resulting from the defacement by a minor or other person
of property of another by graffiti or other inscribed material and
make the abatement and related administrative costs a special
assessment against a parcel of land owned by the minor or other
person or by the parent or guardian having custody and control of the
minor.  The assessment may be collected at the same time and in the
same manner as ordinary municipal taxes are collected and shall be
subject to the same penalties and the same procedure and sale in case
of delinquency as provided for ordinary municipal taxes.  All laws
applicable to the levy, collection, and enforcement of municipal
taxes shall be applicable to the special assessment.  However, if any
real property to which the abatement and related administrative
costs relate has been transferred or conveyed to a bona fide
purchaser for value, or if a lien of a bona fide encumbrancer for
value has been created and attaches thereon prior to the date on
which the first installment of the taxes would become delinquent,
then the abatement and
  related administrative costs shall not result in a lien against the
real property but shall instead be transferred to the unsecured roll
for collection.  Notices or instruments relating to the abatement
proceeding or special assessment may be recorded.
   (b) The terms "abatement and related administrative costs,"
"graffiti or other inscribed material," "minor," and "other person"
have the same meaning as specified in Sections 38772 and 38773.2.
  SEC. 120.  Section 55720 of the Government Code is amended to read:

   55720.  (a) The Board of Supervisors of the County of San Diego
may enter into an agreement with the owner of "telecommuting center
property" to pay to that owner in each fiscal year, for a period not
to exceed five consecutive fiscal years, a Telecommuting Property
Amount (TPA).  Any agreement that is entered into pursuant to this
subdivision shall specify matters including, but not limited to, both
of the following:
   (1) Those conditions that the owner of the property is required to
meet to receive a TPA.
   (2) That period of consecutive fiscal years to which it applies.
The agreement shall designate as the first fiscal year of that period
the first fiscal year beginning after the date upon which the County
of San Diego enters into the agreement.
    An agreement entered into pursuant to this subdivision may not
become invalid by reason of the repeal of this chapter.
   (b) For purposes of this section, the following definitions apply:

   (1) "Telecommuting center property" means tangible personal
property that meets all of the following requirements:
   (A) The property is directly involved in providing not less than
10 separate fully functional workstations with access to high speed
data communications, including, but not limited to,
telecommunications services, cable services, broadcast services,
mobile services, wireless services, satellite services, and Internet
access.
   (B) The property is located at a remote worksite not less than 15
miles from the normal workplace.
   (C) Ancillary services may include facsimile transmissions, high
volume copying, laser printing, video conferencing, and voice mail.
   (D) Use of the property will lead to usage by at least 10
full-time employees for not less than one regular workday of each
week.
   (E) Employees using the telecommuting center property will, by
going to the telecommuting center, reduce their travel distance from
home to their work location by not less than 15 miles one way.
   (F) The Board of Supervisors of the County of San Diego shall make
a finding, in its sole discretion, that the property meets the
requirements of subparagraphs (A) through (E).
   (2) "Telecommuting Property Amount" means an amount equal to the
amount of ad valorem property tax revenue derived from that
telecommuting center property for that fiscal year that is allocated
to the County of San Diego pursuant to Chapter 6 (commencing with
Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation
Code.
   (c) The County of San Diego may cease any further payment of a TPA
under an agreement entered into by the county pursuant to
subdivision (a), and may recapture from the recipient-owner the
amount of any or every TPA previously paid to that recipient-owner
under the agreement, if, at any time during the term of that
agreement, the county determines that either of the following is
true:
   (1) The property with respect to which the agreement was entered
into does not qualify as telecommuting property as defined in
paragraph (1) of subdivision (b).
   (2) The owner-recipient is not in compliance with the conditions
set forth in the agreement for the receipt of a TPA.
   (d) This section applies only with respect to property that is
placed in service on or after January 1, 2001.
  SEC. 121.  Section 65584 of the Government Code is amended to read:

   65584.  (a) For purposes of subdivision (a) of Section 65583, the
share of a city or county of the regional housing needs includes that
share of the housing need of persons at all income levels within the
area significantly affected by a general plan of the city or county.
  The distribution of regional housing needs shall, based upon
available data, take into consideration market demand for housing,
employment opportunities, the availability of suitable sites and
public facilities, commuting patterns, type and tenure of housing
need, the loss of units contained in assisted housing developments,
as defined in paragraph (8) of subdivision (a) of Section 65583, that
changed to non-low-income use through mortgage prepayment, subsidy
contract expirations, or termination of use restrictions, and the
housing needs of farmworkers.  The distribution shall seek to reduce
the concentration of lower income households in cities or counties
that already have disproportionately high proportions of lower income
households.  Based upon population projections produced by the
Department of Finance and regional population forecasts used in
preparing regional transportation plans, and in consultation with
each council of governments, the Department of Housing and Community
Development shall determine the regional share of the statewide
housing need at least two years prior to the second revision, and all
subsequent revisions as required pursuant to Section 65588.  Based
upon data provided by the department relative to the statewide need
for housing, each council of governments shall determine the existing
and projected housing need for its region.  Within 30 days following
notification of this determination, the department shall ensure that
this determination is consistent with the statewide housing need.
The department may revise the determination of the council of
governments if necessary to obtain this consistency.  The appropriate
council of governments shall determine the share for each city or
county consistent with the criteria of this subdivision and with the
advice of the department subject to the procedure established
pursuant to subdivision (c) at least one year prior to the second
revision, and at five-year intervals following the second revision
pursuant to Section 65588.  The council of governments shall submit
to the department information regarding the assumptions and
methodology to be used in allocating the regional housing need.  As
part of the allocation of the regional housing need, the council of
governments, or the department pursuant to subdivision (b), shall
provide each city and county with data describing the assumptions and
methodology used in calculating its share of the regional housing
need.  The department shall submit to each council of governments
information regarding the assumptions and methodology to be used in
allocating the regional share of the statewide housing need.  As part
of its determination of the regional share of the statewide housing
need, the department shall provide each council of governments with
data describing the assumptions and methodology used in calculating
its share of the statewide housing need.  The councils of governments
shall provide each city and county with the department's
information.  The council of governments shall provide a subregion
with its share of the regional housing need, and delegate
responsibility for providing allocations to cities and a county or
counties in the subregion to a subregional entity if this
responsibility is requested by a county and all cities in the county,
a joint powers authority established pursuant to Chapter 5
(commencing with Section 6500) of Division 7 of Title 1, or the
governing body of a subregional agency established by the council of
governments, in accordance with an agreement entered into between the
council of governments and the subregional entity that sets forth
the process, timing, and other terms and conditions of that
delegation of responsibility.
   (b) For areas with no council of governments, the department shall
determine housing market areas and define the regional housing need
for cities and counties within these areas pursuant to the provisions
for the distribution of regional housing needs in subdivision (a).
If the department determines that a city or county possesses the
capability and resources and has agreed to accept the responsibility,
with respect to its jurisdiction, for the identification and
determination of housing market areas and regional housing needs, the
department shall delegate this responsibility to the cities and
counties within these areas.
   (c) (1) Within 90 days following a determination of a council of
governments pursuant to subdivision (a), or the department's
determination pursuant to subdivision (b), a city or county may
propose to revise the determination of its share of the regional
housing need in accordance with the considerations set forth in
subdivision (a).  The proposed revised share shall be based upon
available data and accepted planning methodology, and supported by
adequate documentation.
   (2) Within 60 days after the time period for the revision by the
city or county, the council of governments or the department, as the
case may be, shall accept the proposed revision, modify its earlier
determination, or indicate, based upon available data and accepted
planning methodology, why the proposed revision is inconsistent with
the regional housing need.
   (A) If the council of governments or the department, as the case
may be, does not accept the proposed revision, then the city or
county shall have the right to request a public hearing to review the
determination within 30 days.
   (B) The city or county shall be notified within 30 days by
certified mail, return receipt requested, of at least one public
hearing regarding the determination.
   (C) The date of the hearing shall be at least 30 days from the
date of the notification.
   (D) Before making its final determination, the council of
governments or the department, as the case may be, shall consider
comments, recommendations, available data, accepted planning
methodology, and local geological and topographical restraints on the
production of housing.
   (3) If the council of governments or the department accepts the
proposed revision or modifies its earlier determination, the city or
county shall use that share.  If the council of governments or the
department grants a revised allocation pursuant to paragraph (1), the
council of governments or the department shall ensure that the
current total housing need is maintained.  If the council of
governments or the department indicates that the proposed revision is
inconsistent with the regional housing need, the city or county
shall use the share that was originally determined by the council of
governments or the department.
   (4) The determination of the council of governments or the
department, as the case may be, shall be subject to judicial review
pursuant to Section 1094.5 of the Code of Civil Procedure.
   (5) The council of governments or the department shall reduce the
share of regional housing needs of a county if all of the following
conditions are met:
   (A) One or more cities within the county agree to increase its
share or their shares in an amount that will make up for the
reduction.
   (B) The transfer of shares shall only occur between a county and
cities within that county.
   (C) The county's share of low-income and very low income housing
shall be reduced only in proportion to the amount by which the county'
s share of moderate- and above moderate-income housing is reduced.
   (D) The council of governments or the department, whichever
assigned the county's share, shall have authority over the approval
of the proposed reduction, taking into consideration the criteria of
subdivision (a).
   (6) The housing element shall contain an analysis of the factors
and circumstances, with all supporting data, justifying the revision.
  All materials and data used to justify any revision shall be made
available upon request by any interested party within seven days upon
payment of reasonable costs of reproduction unless the costs are
waived due to economic hardship.
   (d) (1) Except as provided in paragraph (2), any ordinance,
policy, or standard of a city or county that directly limits, by
number, the building permits that may be issued for residential
construction, or limits for a set period of time the number of
buildable lots that may be developed for residential purposes, shall
not be a justification for a determination or a reduction in the
share of a city or county of the regional housing need.
   (2) Paragraph (1) does not apply to any city or county that
imposes a moratorium on residential construction for a specified
period of time in order to preserve and protect the public health and
safety.  If a moratorium is in effect, the city or county shall,
prior to a revision pursuant to subdivision (c), adopt findings that
specifically describe the threat to the public health and safety and
the reasons why construction of the number of units specified as its
share of the regional housing need would prevent the mitigation of
that threat.
   (e) Any authority to review and revise the share of a city or
county of the regional housing need granted under this section shall
not constitute authority to revise, approve, or disapprove the manner
in which the share of the city or county of the regional housing
need is implemented through its housing program.
   (f) A fee may be charged to interested parties for any additional
costs caused by the amendments made to subdivision (c) by Chapter
1684 of the Statutes of 1984 reducing from 45 to 7 days the time
within which materials and data shall be made available to interested
parties.
   (g) Determinations made by the department, a council of
governments, or a city or county pursuant to this section are exempt
from the California Environmental Quality Act, Division 13
(commencing with Section 21000) of the Public Resources Code.
  SEC. 122.  Section 65585.1 of the Government Code is amended to
read:
   65585.1.  (a) The San Diego Association of Governments (SANDAG),
if it approves a resolution agreeing to participate in the
self-certification process, and in consultation with the cities and
county within its jurisdiction, its housing element advisory
committee, and the department, shall work with a qualified consultant
to determine the maximum number of housing units that can be
constructed, acquired, rehabilitated, and preserved as defined in
paragraph (11) of subdivision (e) of Section 33334.2 of the Health
and Safety Code, and the maximum number of units or households that
can be provided with rental or ownership assistance, by each
jurisdiction during the third and fourth housing element cycles to
meet the existing and future housing needs for low- and very low
income households as defined in Sections 50079.5, 50093, and 50105 of
the Health and Safety Code, and extremely low income households.
The methodology for determining the maximum number of housing units
that can be provided shall include a recognition of financial
resources and regulatory measures that local jurisdictions can use to
provide additional affordable lower income housing.  This process is
intended to identify the available resources that can be used to
determine the maximum number of housing units each jurisdiction can
provide.  The process acknowledges that the need to produce housing
for low-, very low, and extremely low income households may exceed
available resources.  The department and SANDAG, with input from its
housing element advisory committee, the consultant, and local
jurisdictions, shall agree upon definitions for extremely low income
households and their affordable housing costs, the methodology for
the determination of the maximum number of housing units and the
number each jurisdiction can produce at least one year before the due
date of each housing element revision, pursuant to paragraph (4) of
subdivision (e) of Section 65588.  If SANDAG fails to approve a
resolution agreeing to participate in this pilot program, or SANDAG
and the department fail to agree upon the methodology by which the
maximum number of housing units is determined, then local
jurisdictions may not self-certify pursuant to  this section.
   (1) The "housing element advisory committee" should include
representatives of the local jurisdictions, nonprofit affordable
housing development corporations and affordable housing advocates,
and representatives of the for-profit building, real estate and
banking industries.
   (2) The determination of the "maximum number of housing units"
that the jurisdiction can provide assumes that the needs for low-,
very low, and extremely low income households, including those with
special housing needs, will be met in approximate proportion to their
representation in the region's population.
   (3) A "qualified consultant" for the purposes of this section
means an expert in the identification of financial resources and
regulatory measures for the provision of affordable housing for lower
income households.
   (b) A city or county within the jurisdiction of the San Diego
Association of Governments that elects not to self-certify, or is
ineligible to do so, shall submit its housing element or amendment to
the department, pursuant to Section 65585.
   (c) A city or county within the jurisdiction of the San Diego
Association of Governments that elects to self-certify shall submit a
self-certification of compliance to the department with its adopted
housing element or amendment.  In order to be eligible to
self-certify, the legislative body, after holding a public hearing,
shall make findings, based on substantial evidence, that it has met
the following criteria for self-certification:
   (1) The jurisdiction's adopted housing element or amendment
substantially complies with the provisions of this article, including
addressing the needs of all income levels.
   (2) For the third housing element revision, pursuant to Section
65588, the jurisdiction met its fair share of the regional housing
needs for the second housing element revision cycle, as determined by
the San Diego Association of Governments.
   In determining whether a jurisdiction has met its fair share, the
jurisdiction may count each additional lower income household
provided with affordable housing costs.  Affordable housing costs are
defined in Section 6918 for renters, and in Section 6925 for
purchasers, of Title 25 of the California Code of Regulations, and in
Sections 50052.5 and 50053 of the Health and Safety Code, or by the
applicable funding source or program.
   (3) For subsequent housing element revisions, pursuant to Section
65588, the jurisdiction has provided the maximum number of housing
units as determined pursuant to subdivision (a), within the previous
planning period.
   (A) The additional units provided at affordable housing costs as
defined in paragraph (2) in satisfaction of a jurisdiction's maximum
number of housing units shall be provided by one or more of the
following means:
   (i) New construction.
   (ii) Acquisition.
   (iii) Rehabilitation.
   (iv) Rental or ownership assistance.
   (v) Preservation of the availability to lower income households of
affordable housing units in developments which are assisted,
subsidized, or restricted by a public entity and which are threatened
with imminent conversion to market rate housing.
   (B) The additional affordable units shall be provided in
approximate proportion to the needs defined in paragraph (2) of
subdivision (a).
   (4) The city or county provides a statement regarding how its
adopted housing element or amendment addresses the dispersion of
lower income housing within its jurisdiction, documenting that
additional affordable housing opportunities will not be developed
only in areas where concentrations of lower income households already
exist, taking into account the availability of necessary public
facilities and infrastructure.
   (5)  No local government actions or policies prevent the
development of the identified sites pursuant to Section 65583, or
accommodation of the jurisdiction's share of the total regional
housing need, pursuant to Section 65584.
   (d) When a city or county within the jurisdiction of the San Diego
Association of Governments duly adopts a self-certification of
compliance with its adopted housing element or amendment pursuant to
subdivision (c), all of the following shall apply:
   (1) Section 65585 shall not apply to the city or county.
   (2) In any challenge of a local jurisdiction's self-certification,
the court's review shall be limited to determining whether the
self-certification is accurate and complete as to the criteria for
self-certification.  Where there has not been a successful challenge
of the self-certification, there shall be a rebuttable presumption of
the validity of the housing element or amendment.
   (3) Within six months after the completion of the revision of all
housing elements in the region, the council of governments, with
input from the cities and county within its jurisdiction, the housing
element advisory committee, and qualified consultant shall report to
the Legislature on the use and results of the self-certification
process by local governments within its jurisdiction.  This report
shall contain data for the last planning period regarding the total
number of additional affordable housing units provided by income
category, the total number of additional newly constructed housing
units, and any other information deemed useful by SANDAG in the
evaluation of the pilot program.
   (e) This section shall become inoperative on June 30, 2009, and as
of January 1, 2010, is repealed, unless a later enacted statute that
is enacted before January 1, 2010, deletes or extends the dates on
which it becomes inoperative and is repealed.
  SEC. 123.  Section 75059.1 of the Government Code is amended to
read:
   75059.1.  (a) A former spouse of a judge retired or deceased as of
January 1, 2001, shall be eligible for the benefits provided by this
section if the community property interest in the system was divided
by court order pursuant to paragraph (4) of subdivision (a) of
Section 2610 of the Family Code, the former spouse retained an
interest in the system, and the parties did not divide the member's
account pursuant to Section 75050.  The monthly allowance payable
pursuant to that division to the former spouse shall be a lifetime
benefit and the former spouse shall have the right to designate a
beneficiary for any unpaid allowance payable at the time of his or
her death.
   (b) The section shall apply retroactively to establish eligibility
for a former spouse to the benefits provided by this section, but
any payment made to the former spouse shall be prospective and shall
commence no earlier than (1) the first day of the month in which the
application was received by the system in those cases where the
member is deceased, or (2) the first day of the month in which a
valid court order is received in cases where the retired judge is
still living.
   (c) The board has no duty to locate or notify the members or
former spouses who may be eligible to apply for the benefits under
this section.
   (d) The benefits provided by this section shall be applicable to
persons otherwise eligible who notify the system in writing prior to
January 1, 2002.
  SEC. 124.  Section 444.21 of the Health and Safety Code is amended
to read:
   444.21.  (a) All communications between a representative of the
program described in subdivision (c) of Section 444.20 and a
subscriber or enrollee, or agent of the subscriber or enrollee, or
any other recipient of health care services or any individual
assisting the recipient of health care services, seeking assistance
regarding a grievance or complaint, if reasonably related to the
requirements of the representative's responsibilities for the
program, and made in good faith, shall be privileged subject to
Division 8 (commencing with Section 900) of the Evidence Code.  The
subscriber, enrollee, or other recipient of health care services
shall be the holder of the privilege and may refuse to disclose, and
may prevent others from disclosing, a communication described in this
subdivision.  Any communication described in this subdivision shall
be a privileged communication, which shall serve as a defense to any
civil action in libel or slander against any of the persons described
in this subdivision.
   (b) All records and files of a program described in subdivision
(c) of Section 444.20 relating to any complaint or request for
assistance regarding a subscriber or enrollee, or any other recipient
of health care services, and their identity, shall remain
confidential, and shall not be subject to discovery, unless
disclosure is authorized by the subscriber or enrollee, or any other
recipient of health care services, or his or her legal
representative.  No disclosures shall be made outside of the program
without the consent of the subscriber or enrollee, or any other
recipient of health care services, that is the subject of the record
or file, unless disclosure is made without disclosing the identity of
that individual.
   (c) Any representative of the program described in subdivision (c)
of Section 444.20 shall be exempt from being required to testify in
court as to any communications described in subdivision (a) except as
the court may deem necessary to fulfill the purposes of the program.

   (d) Nothing in this section shall affect the right of a person or
entity to discover if the communication was not made in good faith
pursuant to an in camera inspection of the communication by a court.

  SEC. 125.  Section 1358.11 of the Health and Safety Code is amended
to read:
   1358.11.  (a) An issuer shall not deny or condition the offering
or effectiveness of any Medicare supplement contract available for
sale in this state, nor discriminate in the pricing of a contract
because of the health status, claims experience, receipt of health
care, or medical condition of an applicant in the case of an
application for a contract that is submitted prior to or during the
six-month period beginning with the first day of the first month in
which an individual is both 65 years of age or older and is enrolled
for benefits under Medicare Part B.  Each Medicare supplement
contract currently available from an issuer shall be made available
to all applicants who qualify under this subdivision and are 65 years
of age or older.  Medicare supplement contracts A, B, C, F, and at
least one letter-designated plan (H, I, or J, at the discretion of
the issuer) that includes coverage for prescription medications, if
currently available from an issuer, shall be made available
                                 to any applicant who qualifies under
this subdivision who is 64 years of age or younger and who does not
have End-Stage Renal Disease.  This section does not prohibit an
issuer in determining subscriber rates from treating applicants who
are under 65 years of age and are eligible for Medicare Part B as a
separate risk classification.
   (b) (1) If an applicant qualifies under subdivision (a) and
submits an application during the time period referenced in
subdivision (a) and, as of the date of application, has had a
continuous period of creditable coverage of at least six months, the
issuer shall not exclude benefits based on a preexisting condition.
   (2) If the applicant qualifies under subdivision (a) and submits
an application during the time period referenced in subdivision (a)
and, as of the date of application, has had a continuous period of
creditable coverage that is less than six months, the issuer shall
reduce the period of any preexisting condition exclusion by the
aggregate of the period of creditable coverage applicable to the
applicant as of the enrollment date.  The manner of the reduction
under this subdivision shall be as specified by the director.
   (c) Except as provided in subdivision (b) and Section 1358.23,
subdivision (a) shall not be construed as preventing the exclusion of
benefits under a contract, during the first six months, based on a
preexisting condition for which the enrollee received treatment or
was otherwise diagnosed during the six months before the coverage
became effective.
   (d) An individual enrolled in Medicare Part B by reason of
disability shall be entitled to open enrollment described in this
section for six months after he or she first becomes eligible for
Medicare Part B.  Sales during the open enrollment period shall not
be discouraged by any means, including the altering of the commission
structure.
   There shall be a one-time open enrollment period of 120 days
commencing on January 1, 2001, for all individuals eligible for
Medicare by reason of disability who do not have End-Stage Renal
Disease.
   (e) An individual who is 65 years of age or older and enrolled in
Medicare Part B is entitled to open enrollment described in this
section for six months following:
   (1) Receipt of a notice of termination or, if no notice is
received, the effective date of termination, from any
employer-sponsored health plan including an employer-sponsored
retiree health plan.  For purposes of this section,
"employer-sponsored retiree health plan" includes any coverage for
medical expenses that is directly or indirectly sponsored or
established by an employer for employees or retirees, their spouses,
dependents, or other included covered persons.
   (2) Termination of health care services for a military retiree or
the retiree's Medicare eligible spouse or dependent as a result of a
military base closure.
   (f) An individual who is 65 years of age or older and enrolled in
Medicare Part B is entitled to open enrollment described in this
section if the individual was covered under a policy, certificate, or
contract providing Medicare supplement coverage but that coverage
terminated because the individual established residence at a location
not served by the issuer.
   (g) (1) An individual who was previously enrolled in, but whose
coverage was terminated between September 1, 1998, and December 31,
1998, by a Medicare managed care plan shall be entitled to a new
60-day open enrollment period in addition to any open enrollment
authorized by federal law or regulation, for any and all Medicare
supplement coverage available on a guaranteed basis under state and
federal law or regulation for persons terminated by their Medicare
managed care plan.
   (2) The new open enrollment period specified in paragraph (1)
shall commence 90 days after January 1, 2000.  Within 30 days of
January 1, 2000, health plans shall notify their former Medicare
enrollees who were terminated during the period specified in
paragraph (1) of the new open enrollment period.  Health plan notices
shall inform the terminated enrollees of the opportunity to secure
advice and assistance from the Health Insurance Counseling and
Advocacy Program (HICAP) in their area, along with the toll-free
telephone number for HICAP.
   (3) An individual who was previously enrolled in but whose
coverage was terminated after January 1, 1999, by a Medicare managed
care plan shall be entitled to an additional 60-day open enrollment
period to be added on to and run consecutively after any open
enrollment period authorized by federal law or regulation, for any
and all Medicare supplement coverage available on a guaranteed basis
under state and federal law or regulations for persons terminated by
their Medicare managed care plan.
   (4) Health plans that terminate Medicare enrollees shall notify
those enrollees in the termination notice of the additional open
enrollment period authorized by this subdivision.  Health plan
notices shall inform enrollees of the opportunity to secure advice
and assistance from the Health Insurance Counseling Advocacy Program
(HICAP) in their area, along with the toll-free telephone number for
HICAP.
   (h) An individual shall be entitled to an annual open enrollment
period lasting 30 days or more, commencing with the individual's
birthday, during which time that person may purchase any Medicare
supplement coverage, with the exception of a Medicare Select
contract, that offers benefits equal to or lesser than those provided
by the previous coverage.  During this open enrollment period, no
issuer that falls under this provision shall deny or condition the
issuance or effectiveness of Medicare supplement coverage, nor
discriminate in the pricing of coverage, because of health status,
claims experience, receipt of health care, or medical condition of
the individual if, at the time of the open enrollment period, the
individual is covered under another Medicare supplement policy,
certificate, or contract.  An issuer that offers Medicare supplement
contracts shall notify an enrollee of his or her rights under this
subdivision at least 30 and no more than 60 days before the beginning
of the open enrollment period.
  SEC. 126.  The heading of Article 10.5 (commencing with Section
1399.801) of Chapter 2.2 of Division 2 of the Health and Safety Code
is amended and renumbered to read:

      Article 11.5.  Individual Access to Contracts for Health Care
Services

  SEC. 127.  Section 11836 of the Health and Safety Code is amended
to read:
   11836.  (a) The department shall have the sole authority to issue,
deny, suspend, or revoke the license of a
driving-under-the-influence program.  As used in this chapter,
"program" means any firm, partnership, association, corporation,
local governmental entity, agency, or place that has been initially
recommended by the county board of supervisors, subject to any
limitation imposed pursuant to subdivisions (c) and (d), and that is
subsequently licensed by the department to provide alcohol or drug
recovery services in that county to any of the following:
   (1) A person whose license to drive has been administratively
suspended or revoked for, or who is convicted of, a violation of
Section 23152 or 23153 of the Vehicle Code, and admitted to a program
pursuant to Section 13352, 13353.4, 23538, 23542, 23548, 23552,
23556, 23562, or 23568 of the Vehicle Code.
   (2) A person who is convicted of a violation of subdivision (b),
(c), (d), or (e) of Section 655 of the Harbors and Navigation Code,
or of Section 655.4 of that code, and admitted to the program
pursuant to Section 668 of that code.
   (3) A person who has pled guilty or nolo contendere to a charge of
a violation of Section 23103 of the Vehicle Code, under the
conditions set forth in subdivision (c) of Section 23103.5 of the
Vehicle Code, and who has been admitted to the program under
subdivision (e) of Section 23103.5 of the Vehicle Code.
   (4) A person whose license has been suspended, revoked, or delayed
due to a violation of Section 23140, and who has been admitted to a
program under Article 2 (commencing with Section 23502) of Chapter 1
of Division 11.5 of the Vehicle Code.
   (b) If a firm, partnership, corporation, association, local
government entity, agency, or place has, or is applying for, more
than one license, the department shall treat each licensed program,
or each program seeking licensure, as belonging to a separate firm,
partnership, corporation, association, local government entity,
agency, or place for the purposes of this chapter.
   (c) For purposes of providing recommendations to the department
pursuant to subdivision (a), a county board of supervisors may limit
its recommendations to those programs that provide services for
persons convicted of a first driving-under-the-influence offense, or
services to those persons convicted of a second or subsequent
driving-under-the-influence offense, or both services.  If a county
board of supervisors fails to provide recommendations, the department
shall determine the program or programs to be licensed in that
county.
   (d) After determining a need, a county board of supervisors may
also place one or more limitations on the services to be provided by
a driving-under-the-influence program or the area the program may
operate within the county, when it initially recommends a program to
the department pursuant to subdivision (a).
   (1) For purposes of this subdivision, a board of supervisors may
restrict a program for those convicted of a first
driving-under-the-influence offense to providing only a three-month
program, or may restrict a program to those convicted of a second or
subsequent driving-under-the-influence offense to providing only an
18-month program, as a condition of its recommendation.
   (2) A board of supervisors may not place any restrictions on a
program that would violate any statute or regulation.
   (3) When recommending a program, if a board of supervisors fails
to place any limitation on a program pursuant to this subdivision,
the department may license that program to provide any
driving-under-the-influence program services that are allowed by law
within that county.
   (4) This subdivision is intended to apply only to the initial
recommendation to the State Department of Alcohol and Drug Programs
for licensure of a program by the county.  It is not intended to
affect any license that has been previously issued by the department
or the renewal of any license for a driving-under-the-influence
program.  In counties where a contract or other written agreement is
currently in effect between the county and a licensed
driving-under-the-influence program operating in that county, this
subdivision is not intended to alter the terms of that relationship
or the renewal of that relationship.
   (e) This section shall become operative on January 1, 2001.
  SEC. 128.  Section 11877.2 of the Health and Safety Code is amended
to read:
   11877.2.  (a) The department shall establish a program for the
operation and regulation of office-based opiate treatment programs.
An office-based opiate treatment program established pursuant to this
section shall meet either of the following conditions:
   (1) Hold a primary narcotics treatment program license.
   (2) Be affiliated and associated with a primary licensed narcotics
treatment program.  An office-based opiate treatment program meeting
the requirement of this paragraph shall not be required to have a
separate license from the primary licensed narcotics treatment
program with which it is affiliated and associated.
   (b) For purposes of this section, "office-based opiate treatment
program" means a program in which interested and knowledgeable
physicians provide addiction treatment services, and in which
community pharmacies supply necessary medication both to these
physicians for distribution to patients and through direct
administration and specified dispensing services.
   (c) Notwithstanding any other provision of law or regulation,
including Section 10020 of Title 9 of the California Code of
Regulations, an office-based opiate treatment program in a remote
site, that is affiliated and associated with a licensed narcotics
treatment program, may be approved by the department, if all of the
following conditions are met:
   (1) A physician may provide office-based addiction services only
if each office-based patient is registered as a patient in the
licensed narcotic treatment program and both the licensed narcotic
treatment program and the office-based opiate treatment program
ensure that all services required under Chapter 4 (commencing with
Section 10000) of Division 4 of Title 9 of the California Code of
Regulations for the management of opiate addiction are provided to
all patients treated in the remote site.
   (2) A physician in an office-based opiate treatment program may
provide treatment for a maximum of 20 patients under the appropriate
United States Drug Enforcement Administration registration.  The
primary licensed narcotics treatment program shall be limited to its
total licensed capacity as established by the department, including
the patients of physicians in the office-based opiate treatment
program.
   (3) The physicians in the office-based opiate treatment program
shall dispense or administer pharmacologic treatment for opiate
addiction that has been approved by the federal Food and Drug
Administration such as levoalphacetylmethadol (LAAM) or methadone.
   (4) Office-based opiate treatment programs, in conjunction with
primary licensed narcotics treatment programs, shall develop
protocols to prevent the diversion of methadone.  The department may
develop regulations to prevent the diversion of methadone.
   (d) For purposes of this section, "remote site" means a site that
is geographically or physically isolated from any licensed narcotic
treatment program.  Therefore, the requirements in this subdivision
regarding a remote site do not apply to an office-based opiate
treatment program that holds a primary narcotics treatment license.
   (e) In considering an office-based opiate treatment program
application, the department shall independently weigh the treatment
needs and concerns of the county, city, or areas to be served by the
program.
   (f) Nothing in this section is intended to expand the scope of the
practice of pharmacy.
  SEC. 129.  Section 17922 of the Health and Safety Code is amended
to read:
   17922.  (a) Except as otherwise specifically provided by law, the
building standards adopted and submitted by the department for
approval pursuant to Chapter 4 (commencing with Section 18935) of
Part 2.5, and the other rules and regulations that are contained in
Title 24 of the California Code of Regulations, as adopted, amended,
or repealed from time to time pursuant to this chapter shall be
adopted by reference, except that the building standards and rules
and regulations shall include any additions or deletions made by the
department.  The building standards and rules and regulations shall
impose substantially the same requirements as are contained in the
most recent editions of the following uniform industry codes as
adopted by the organizations specified:
   (1) The Uniform Housing Code of the International Conference of
Building Officials, except its definition of "substandard building."
   (2) The Uniform Building Code of the International Conference of
Building Officials.
   (3) The Uniform Plumbing Code of the International Association of
Plumbing and Mechanical Officials.
   (4) The Uniform Mechanical Code of the International Conference of
Building Officials and the International Association of Plumbing and
Mechanical Officials.
   (5) The National Electrical Code of the National Fire Protection
Association.
   (6) Appendix Chapter 1 of the Uniform Code for Building
Conservation of the International Conference of Building Officials.
   (b) In adopting building standards for approval pursuant to
Chapter 4 (commencing with Section 18935) of Part 2.5 for publication
in the California Building Standards Code and in adopting other
regulations, the department shall consider local conditions and any
amendments to the uniform codes referred to in this section.  Except
as provided in Part 2.5 (commencing with Section 18901), in the
absence of adoption by regulation, the most recent editions of the
uniform codes referred to in this section shall be considered to be
adopted one year after the date of publication of the uniform codes.

   (c) Except as provided in Section 17959.5, local use zone
requirements, local fire zones, building setback, side and rear yard
requirements, and property line requirements are hereby specifically
and entirely reserved to the local jurisdictions notwithstanding any
requirements found or set forth in this part.
   (d) Regulations other than building standards which are adopted,
amended, or repealed by the department, and building standards
adopted and submitted by the department for approval pursuant to
Chapter 4 (commencing with Section 18935) of Part 2.5, governing
alteration and repair of existing buildings and moving of apartment
houses and dwellings shall permit the replacement, retention, and
extension of original materials and the continued use of original
methods of construction as long as the hotel, lodginghouse, motel,
apartment house, or dwelling, or portions thereof, or building and
structure accessory thereto, complies with the provisions published
in the California Building Standards Code and the other rules and
regulations of the department or alternative local standards adopted
pursuant to subdivision (b) of Section 13143.2 or Section 17958.5 and
does not become or continue to be a substandard building.  Building
additions or alterations which increase the area, volume, or size of
an existing building, and foundations for apartment houses and
dwellings moved, shall comply with the requirements for new buildings
or structures specified in this part, or in building standards
published in the California Building Standards Code, or in the other
rules and regulations adopted pursuant to this part.  However, the
additions and alterations shall not cause the building to exceed area
or height limitations applicable to new construction.
   (e) Regulations other than building standards which are adopted by
the department and building standards adopted and submitted by the
department for approval pursuant to Chapter 4 (commencing with
Section 18935) of Part 2.5 governing alteration and repair of
existing buildings shall permit the use of alternate materials,
appliances, installations, devices, arrangements, or methods of
construction if the material, appliance, installation, device,
arrangement, or method is, for the purpose intended, at least the
equivalent of that prescribed in this part, the building standards
published in the California Building Standards Code, and the rules
and regulations promulgated pursuant to the provisions of this part
in performance, safety, and for the protection of life and health.
Regulations governing abatement of substandard buildings shall permit
those conditions prescribed by Section 17920.3 which do not endanger
the life, limb, health, property, safety, or welfare of the public
or the occupant thereof.
   (f) A local enforcement agency may not prohibit the use of
materials, appliances, installations, devices, arrangements, or
methods of construction specifically permitted by the department to
be used in the alteration or repair of existing buildings, but those
materials, appliances, installations, devices, arrangements, or
methods of construction may be specifically prohibited by local
ordinance as provided pursuant to Section 17958.5.
   (g) A local ordinance may not permit any action or proceeding to
abate violations of regulations governing maintenance of existing
buildings, unless the building is a substandard building or the
violation is a misdemeanor.
  SEC. 130.  Section 25358.6.1 of the Health and Safety Code is
amended to read:
   25358.6.1.  (a) For purposes of this section, the following
definitions shall apply:
   (1) "Engineering, architectural, environmental, landscape
architectural, construction project management, or land surveying
services" includes professional services of an engineering,
architectural, environmental, landscape architectural, construction
project management, land surveying, or similar nature, as well as
incidental services that members of these professions and those in
their employ may logically or justifiably perform.
   (2) "Firm" means any individual, firm, partnership, corporation,
association, or other legal entity permitted by law to practice the
profession of engineering, architecture, environmental, landscape
architecture, construction project management, or land surveying.
   (3) "Prequalified list" means a list of engineering,
architectural, environmental, landscape architectural, construction
project management, or land surveying firms that possess the
qualifications established by the department to perform specific
types of engineering, architectural, environmental, and land
surveying services, with each firm ranked in order of its
qualifications and costs.
   (b) Notwithstanding Chapter 10 (commencing with Section 4525) of
Division 5 of Title 1 of the Government Code, the department may
advertise and award a contract, in accordance with this section, for
engineering, architectural, environmental, landscape architectural,
construction project management, or land surveying services pursuant
to this chapter or Chapter 6.5 (commencing with Section 25100), if
the contract is individually in an amount equal to, or less than, one
million dollars ($1,000,000).
   (c) The department may establish prequalified lists of
engineering, architectural, environmental, landscape architectural,
construction project management, or land surveying firms in
accordance with the following process:
   (1) For each type of engineering, architectural, environmental,
landscape architectural, construction project management, or land
surveying services work for which the department elects to use this
section for advertising and awarding contracts, the department shall
request annual statements of qualifications from interested firms.
The request for statements of qualifications shall be announced
statewide through the California State Contracts Register and
publications, Internet Web sites, or electronic bulletin boards of
respective professional societies that are intended, designed, and
maintained by the professional societies to communicate with their
memberships.  Each announcement shall describe the general scope of
services to be provided within each generic project category for
engineering, architectural, environmental, landscape architectural,
construction project management, or land surveying services that the
department anticipates may be awarded during the period covered by
the announcement.
   (2) The department shall define a generic project category so that
each specific project to be awarded within that generic project
category is substantially similar to all other projects within that
generic project category, may be within the same size range and
geographical area, and requires substantially similar skills and
magnitude of professional effort as every other project within that
generic project category.  The generic categories shall provide a
basis for evaluating and establishing the type, quality, and costs,
including hourly rates for personnel and field activities and
equipment, of the services that would be provided by the firm.
   (3) The department shall evaluate the statements of qualifications
received pursuant to paragraph (1) and the department shall develop
a short list of the most qualified firms that meet the criteria
established and published by the department.  The department shall
hold discussions regarding each firm's qualifications with all firms
listed on the short list.  The department shall then rank the firms
listed on the short list according to each firm's qualifications and
the evaluation criteria established and published by the department.

   (4) The department shall maintain prequalified lists of civil
engineering, architectural, environmental, landscape architectural,
construction project management, or land surveying firms ranked
pursuant to paragraph (3) on an ongoing basis, except that no firm
may remain on a list developed pursuant to paragraph (3) based on a
single qualification statement for more than three years.  The
department shall include in each prequalified list adopted pursuant
to paragraph (3) no less than three firms, unless the department
certifies that the scope of the prequalified list is appropriate for
the department's needs, taking into account the nature of the work,
that the department made reasonable efforts to solicit qualification
statements from qualified firms, and that the efforts were
unsuccessful in producing three firms that met the established
criteria.  A firm may remain on the prequalified list up to three
years without resubmitting a qualification statement, but the
department may add additional firms to that list and may annually
rank these firms.  For purposes of annual adjustment to the ranking
of firms already on the prequalified list developed pursuant to
paragraph (3), the department shall rely on that firm's most recent
annual qualification statement, if the statement is not more than
three years old.
   (5) During the term of the prequalified list developed pursuant to
paragraph (3), as specific projects are identified by the department
as being eligible for contracting under the procedures adopted
pursuant to subdivision (d), the department shall contact the highest
ranked firm on the appropriate prequalified list to determine if
that firm has sufficient staff and is available for performance of
the project.  If the highest ranked firm is not available, the
department shall continue to contact firms on the prequalified list
in order of rank until a firm that is available is identified.
   (6) The department may enter into a contract for the services with
a firm identified pursuant to paragraph (5), if the contract is for
a total price that the department determines is fair and reasonable
to the department and otherwise conforms to all matters and terms
previously identified and established upon participation in the
prequalified list.
   (7) If the department is unable to negotiate a satisfactory
contract with a firm identified pursuant to paragraph (6), the
department shall terminate the negotiations with that firm and the
department shall undertake negotiations with the next ranked firm
that is available for performance.  If
                a satisfactory contract cannot be negotiated with the
second identified firm, the department shall terminate these
negotiations and the department shall continue the negotiation
process with the remaining qualified firms, in order of their
ranking, until the department negotiates a satisfactory contract.  If
the department is unable to negotiate a satisfactory contract with a
firm on two separate occasions, the department may remove that firm
from the prequalified list.  The department may award a contract to a
firm on a prequalified list that is to be executed, including
amendments, for a term that extends beyond the expiration date of
that firm's tenure on the prequalified list.
   (8) Once a satisfactory contract is negotiated and awarded to a
firm from any prequalified list for a generic project category
involving a site or facility investigation or characterization, a
feasibility study, or a remedial design, for a specific response
action or corrective action, including, but not limited to, a
corrective action carried out pursuant to Section 25200.10, the
department shall not enter into a contract with that firm for
purposes of construction or implementation of any part of that same
response action or corrective action.
   (d) The department may adopt guidelines or regulations as
necessary, and consistent with this section, to define the manner of
advertising, generic project categories, type, quantity and cost of
services, qualification standards and evaluation criteria, content
and submittal requirements for statements of qualification,
procedures for ranking of firms and administration of the
prequalified list, the scope of matters addressed by participation on
a prequalified list, manner of notification of, negotiation with,
and awarding of contracts to, prequalified firms, and procedures for
protesting the award of contracts under this section, or any other
matter that is appropriate for implementation of this section.
   (e) Any removal or remedial action taken or contracted by the
department pursuant to Section 25354 or subdivision (a) of Section
25358.3 is exempt from this section.
   (f) This section does not exempt any contract from compliance with
Article 4 (commencing with Section 19130) of Chapter 5 of Part 2 of
Division 5 of Title 2 of the Government Code.
  SEC. 131.  Section 39619.6 of the Health and Safety Code is amended
to read:
   39619.6.  (a) By June 30, 2002, the state board and the State
Department of Health Services, in consultation with the State
Department of Education, the Department of General Services, and the
Office of Environmental Health Hazard Assessment, shall conduct a
comprehensive study and review of the environmental health conditions
in portable classrooms, as defined in subdivision (k) of Section
17070.15 of the Education Code.
   (b) The state board and the department shall jointly coordinate
the study, oversee data analysis and quality assurance, coordinate
stakeholder participation, and prepare recommendations.  The state
board shall develop and oversee the contract for field work, air
monitoring, and data analysis, and obtain equipment for the study.
The department shall oversee the assessment of ventilation systems
and practices and the evaluation of microbiological contaminants, and
may provide laboratory analyses as needed.
   (c) By August 31, 2000, the state board shall release a request
for proposals for the field portion of the study.  Field work shall
begin not later than July 2001.  The final report shall be completed
on or before June 30, 2002, and shall be provided to the appropriate
policy committees of the Legislature.  The study of portable
classrooms shall include all of the following:
   (1) Review of design and construction specifications, including
those for ventilation systems.
   (2) Review of school maintenance practices, including the actual
operation or nonoperation of ventilation systems.
   (3) Assessment of indoor air quality.
   (4) Assessment of potential toxic contamination, including molds
and other biological contaminants.
   (d) The final report shall summarize the results of the study and
review, and shall include recommendations to remedy and prevent
unhealthful conditions found in portable classrooms, including the
need for all of the following:
   (1) Modified design and construction standards, including
ventilation specifications.
   (2) Emission limits for building materials and classroom
furnishings.
   (3) Other mitigation actions to ensure the protection of children'
s health.
  SEC. 132.  Section 104170 of the Health and Safety Code is amended
to read:
   104170.  (a) The Human Leukocyte Antigen Testing Fund is hereby
established in the State Treasury, to be administered by the State
Department of Health Services.  Moneys in the fund shall be subject
to appropriation in the annual Budget Act, and shall be used to pay
the costs of blood collection and human leukocyte antigen typing,
also referred to as histocompatibility locus antigen (HLA) testing,
for A, B, and DR antigens for use in bone marrow transplantation by
California blood centers under contract with the federal National
Marrow Donor Program provided for pursuant to Public Law 101-302.
   (b) Moneys in the fund may only be expended if the individual
being tested completes and signs an informed consent form authorizing
the use of test results for participation in the federal program
referred to in subdivision (a).  The form shall require a declaration
from the donor as to whether he or she has health plan benefits that
would cover the cost of HLA testing.  Moneys in the fund shall not
be used to pay for the testing of a health plan enrollee if the
health plan covers the cost of HLA testing for the enrollee.
  SEC. 133.  Section 104320 of the Health and Safety Code, as added
by Section 25 of Chapter 93 of the Statutes of 2000, is amended and
renumbered to read:
   104322.  (a) The State Department of Health Services shall
develop, expand, and ensure quality prostate cancer treatment to
low-income and uninsured men.  The department shall award one or more
contracts to provide prostate cancer treatment through private or
public nonprofit organizations, including, but not limited to,
community-based organizations, local health care providers, and the
University of California medical centers.  The contracts shall not be
subject to Part 2 (commencing with Section 10100) of Division 2 of
the Public Contract Code.
   (b) Treatment provided under this chapter shall be provided to
uninsured and underinsured men with incomes at or below 200 percent
of the federal poverty level.
   (c) The department shall contract for prostate cancer treatment
services only at the level of funding budgeted from state and other
sources during a fiscal year in which the Legislature has
appropriated funds to the department for this purpose.
  SEC. 134.  Section 105112 of the Health and Safety Code is amended
to read:
   105112.  (a) It is the intent of the Legislature that University
of California medical students complete a definable curriculum in
geriatric medicine over the course of their medical school training
to meet recommended core competencies for the care of older persons.
It is the intent of the Legislature that this curriculum instill the
attitudes, knowledge, and skills that physicians need to provide
competent and compassionate care for older persons, including both
didactic and clinical experiences encompassing the spectrum of health
status of older persons and community-based sites for clinical
training.
   (b) It is the intent of the Legislature that University of
California medical residents in internal medicine, family practice,
and psychiatry complete a definable curriculum in geriatric medicine
over the course of their residency training.  It is the intent of the
Legislature that this curriculum instill the attitudes, knowledge,
and skills that physicians practicing these specialties need to
provide competent and compassionate care for older persons.  This
curriculum should encompass the spectrum of health status of older
persons and include community-based sites for clinical training.
   (c) It is the intent of the Legislature that the University of
California be responsible for developing, implementing, maintaining,
and evaluating the geriatric medicine content needed in the
curriculum.  The curriculum shall take into consideration the
recommendations of the Institute of Medicine of the National Academy
of Sciences, the American Geriatric Society, and other nationally
recognized medical organizations.  The expanded geriatric medicine
program and curriculum should be developed and implemented at each
University of California school of medicine as soon as possible, but
no later than September 1, 2003.
   (d) The Legislature requests that, no later than March 30, 2003,
the Regents of the University of California submit a progress report
on the status of the implementation of a definable curriculum in
geriatric medicine at each campus in accordance with this act.
   (e) The Legislature requests that, no later than March 30, 2004,
the Regents of the University of California submit a report on the
status of the implementation of a definable curriculum in geriatric
medicine at each campus.  The report should include the total number
of hours of geriatric instruction to be given at each school of
medicine and the number of weeks of that instruction or experience
provided at each medical school.  This report should be written by a
committee that is specifically charged with reporting on the status
of the implementation of this section.  The majority of committee
members should be national experts in the geriatric field who are not
University of California employees.
   (f) The Legislature requests that every 5 years, commencing no
later than June 30, 2005, the Regents of the University of California
submit a report describing progress in geriatrics training and
related initiatives at each campus in accordance with the act.  This
report should be written by a committee that is specifically charged
with evaluating this progress.  The majority of committee members
should be national experts in the geriatric field who are not
University of California employees.
   (g) Copies of the reports requested in subdivisions (d), (e), and
(f) are to be submitted to the members of the Assembly Committee on
Aging and Long-Term Care, the members of the Senate Health and Human
Services Subcommittee on Aging and Long-Term Care, and the
Chairpersons of the Assembly Committee on Budget and the Senate
Committee on Budget and Fiscal Review.
   (h) It is the intent of the Legislature that the professors
occupying the University of California endowed chairs in geriatric
medicine funded in the 2000-01 Budget Act provide leadership in
developing and implementing the expanded geriatric medicine programs
and curriculum at the University of California, and that one-time
funds provided to the Academic Geriatric Resource Program in the
Budget Act of 2000 also be used to expand geriatric medicine programs
and curriculum at the university to implement subdivisions (a) and
(b).
  SEC. 135.  Section 111656.5 of the Health and Safety Code is
amended to read:
   111656.5.  (a) A person other than a licensed pharmacist, an
intern pharmacist, an exemptee, as specified in Section 111656.4, or
an authorized agent of the department or a person authorized to
prescribe, may not be permitted in that area, place, or premises
described in the license issued by the department wherein
prescription devices are stored, possessed, prepared, manufactured,
or repacked, except that a licensed pharmacist or exemptee shall be
responsible for any individual who enters the medical device retail
facility for the purposes of receiving, fitting, or consultation from
the licensed pharmacist or exemptee or any person performing
clerical, inventory control, housekeeping, delivery, maintenance, or
similar functions relating to the home medical device retail
facility.  The licensed pharmacist or exemptee shall remain present
in the home medical device retail facility any time an individual is
present who is seeking a fitting or consultation.  However, a
licensed pharmacist or an exemptee need not be present on the
premises of a home medical device retail facility at all times of its
operation and need not be present in a warehouse facility owned by a
home medical device retail facility unless the department
establishes that requirement by regulation based upon the need to
protect the public.  The exemptee need not be present if the
prescription devices are stored in a secure locked area under the
exclusive control of the exemptee and unavailable for dispensing.
This subdivision shall apply only to prescription devices.
   (b) A "warehouse" as used in this section, is a facility owned by
a home medical device retail facility that is used for storage only.
There may not be fitting, display, or sales at that location.  A
licensed pharmacist or exemptee shall be designated as "in charge" of
a warehouse but need not be present during its operation.  The
licensed pharmacist or exemptee may permit others to possess a key to
the warehouse.
   (c) Notwithstanding the remainder of this section, a home medical
device retail facility may establish a locked facility, meeting the
requirements of Section 111656.4, for furnishing prescription devices
to patients having prescriptions for prescription devices in
emergencies or after working hours.
   (d) The department may establish reasonable security measures
consistent with this section as a condition of licensing in order to
prevent unauthorized persons from gaining access to the area, place,
or premises, or to the prescription devices therein.
   (e) The department may by regulation establish labeling
requirements for prescription devices sold, fitted, or dispensed by a
home medical device retail facility as it deems necessary for the
protection of the public.
  SEC. 136.  Section 111656.13 of the Health and Safety Code is
amended to read:
   111656.13.  (a) Any entity that prior to July 1, 2001, held a
current, valid license as a medical device retailer pursuant to
Section 4130 of the Business and Professions Code, shall be deemed to
be a licensed home medical device retail facility until the
expiration of that license if the entity is in compliance with all
applicable criteria for obtaining a license as a home medical device
retail facility.
   (b) Any entity that was not required to obtain a license as a
medical device retailer in order to provide equipment or services
prior to July 1, 2001, and that is required to obtain a license as a
home medical device retail facility pursuant to Section 111656, shall
apply for a license as a home medical device retail facility by July
1, 2001; however, the requirement for licensure shall only apply to
those entities on and after January 1, 2002.
  SEC. 137.  Section 114145 of the Health and Safety Code is amended
to read:
   114145.  (a) Each food establishment, except produce stands and
swap meet prepackaged food stands, shall be fully enclosed in a
building consisting of floors, walls, and an overhead structure that
meet the minimum standards prescribed by this chapter.  Food
establishments that are not fully enclosed on all sides and that are
in operation on January 1, 1985, shall not be required to meet the
requirement for a fully enclosed structure pursuant to this section.

   (b) This section shall not be construed to require the enclosure
of any of the following:
   (1) Dining areas.
   (2) Open-air barbecue facilities.
   (3) Outdoor wood-burning ovens that meet all of the food
preparation and safety requirements applicable to open-air barbecue
facilities.
   (4) Outdoor beverage bars contiguous with a fully enclosed food
establishment under the constant and complete control of the operator
of the food establishment, provided that the following requirements
are met:
   (A) The food establishment is a bona fide public eating place, as
defined by Sections 23038, 23038.1, and 23038.2 of the Business and
Professions Code.
   (B) The operator of the food establishment is a licensee, as
defined by Section 23009 of the Business and Professions Code,
performing under authority of a license issued pursuant to the
Alcoholic Beverage Control Act (Division 9 (commencing with Section
23000) of the Business and Professions Code) for the outdoor beverage
bar.
   (C) The outdoor beverage bar is, at all times, operated pursuant
to the requirements of this chapter, including, without limitation,
Sections 114010 and 114080, and any conditions imposed by the local
health agency to ensure compliance with the requirements of this
chapter.
   (5) Outdoor displays that meet all of the following requirements:

   (A) Only prepackaged nonpotentially hazardous food, uncut produce,
or both is displayed or sold in the outdoor displays.
   (B) Outdoor displays are contiguous with a fully enclosed food
establishment that is in compliance with subdivision (a).
   (C) Outdoor displays have overhead protection that extends over
all food items.
   (D) Food items from the outdoor display are stored inside a fully
enclosed food establishment that is in compliance with subdivision
(a) at all times other than during business hours.  Any food items to
be stored pursuant to this subdivision shall be stored in accordance
with subdivision (a) of Section 114080.
   (E) Outdoor displays comply with Section 114010 and have been
approved by the enforcement agency.
   (F) Outdoor displays are under the constant and complete control
of the operator of the permitted food establishment.
   (c) This section shall not be construed to require the enclosure
during operating hours of customer self-service nonpotentially
hazardous bulk beverage dispensing operations that meet the following
requirements:
   (1) The dispensing operations are installed contiguous with a
fully enclosed food establishment that is in compliance with
subdivision (a) and operated by the food establishment.
   (2) The beverages are dispensed from enclosed equipment that
precludes exposure of the beverages until they are dispensed at the
nozzles.
   (3) Ice is dispensed only from an ice maker dispenser.  Ice is not
scooped or manually loaded into an ice dispenser out of doors.
   (4) Single-service utensils are protected from contamination and
are individually wrapped or dispensed from approved sanitary
dispensers.
   (5) The dispensing operations have overhead protection that fully
extends over all equipment associated with the facility.
   (6) During nonoperating hours, the dispensing operations are fully
enclosed so as to be protected from contamination by vermin and
exposure to the elements.
   (7) The owner or operator of the food establishment demonstrates
to the enforcement agency that acceptable methods are in place to
properly clean and sanitize the beverage dispensing equipment.
   (8) Beverage dispensing operations are in compliance with Section
114010 and have been approved by the enforcement agency.
   (9) Beverage dispensing operations are under the constant and
complete control of the permitholder of the food establishment that
is operating the dispensing facility.
   (d) This section shall not be construed to allow outdoor displays
in violation of local ordinances.
  SEC. 138.  Section 123111 of the Health and Safety Code is amended
to read:
   123111.  (a) Any adult patient who inspects his or her patient
records pursuant to Section 123110 shall have the right to provide to
the health care provider a written addendum with respect to any item
or statement in his or her records that the patient believes to be
incomplete or incorrect.  The addendum shall be limited to 250 words
per alleged incomplete or incorrect item in the patient's record and
shall clearly indicate in writing that the patient wishes the
addendum to be made a part of his or her record.
   (b) The health care provider shall attach the addendum to the
patient's records and shall include that addendum whenever the health
care provider makes a disclosure of the allegedly incomplete or
incorrect portion of the patient's records to any third party.
   (c) The receipt of information in a patient's addendum which
contains defamatory or otherwise unlawful language, and the inclusion
of this information in the patient's records, in accordance with
subdivision (b), shall not, in and of itself, subject the health care
provider to liability in any civil, criminal, administrative, or
other proceeding.
   (d) Subdivision (f) of Section 123110 and Section 123120 shall be
applicable with respect to any violation of this section by a health
care provider.
  SEC. 139.  Section 124900 of the Health and Safety Code is amended
to read:
   124900.  (a) (1) The State Department of Health Services shall
select primary care clinics that are licensed under paragraph (1) or
(2) of subdivision (a) of Section 1204, or are exempt from licensure
under subdivision (c) of Section 1206, to be reimbursed for
delivering medical services, including preventive health care, and
smoking prevention and cessation health education, to program
beneficiaries.
   (2) Except as provided for in paragraph (3), in order to be
eligible to receive funds under this article a clinic shall meet all
of the following conditions, at a minimum:
   (A) Provide medical diagnosis and treatment.
   (B) Provide medical support services of patients in all stages of
illness.
   (C) Provide communication of information about diagnosis,
treatment, prevention, and prognosis.
   (D) Provide maintenance of patients with chronic illness.
   (E) Provide prevention of disability and disease through
detection, education, persuasion, and preventive treatment.
   (F) Meet one or both of the following conditions:
   (i) Are located in an area federally designated as a medically
underserved area or medically underserved population.
   (ii) Are clinics that are able to demonstrate that at least 50
percent of the patients served are persons with incomes at or below
200 percent of the federal poverty level.
   (3) Notwithstanding the requirements of paragraph (2), all clinics
that received funds under this article in the 1997-98 fiscal year
shall continue to be eligible to receive funds under this article.
   (b) As a part of the award process for funding pursuant to this
article, the department shall take into account the availability of
primary care services in the various geographic areas of the state.
The department shall determine which areas within the state have
populations which have clear and compelling difficulty in obtaining
access to primary care.  The department shall consider proposals from
new and existing eligible providers to extend clinic services to
these populations.
   (c) Each primary care clinic applying for funds pursuant to this
article shall demonstrate that the funds shall be used to expand
medical services, including preventive health care, and smoking
prevention and cessation health education, for program beneficiaries
above the level of services provided in the 1988 calendar year or in
the year prior to the first year a clinic receives funds under this
article if the clinic did not receive funds in the 1989 calendar
year.
   (d) (1) The department, in consultation with clinics funded under
this article, shall develop a formula for allocation of funds
available.  It is the intent of the Legislature that the funds
allocated pursuant to this article promote stability for those
clinics participating in programs under this article as part of the
state's health care safety net and at the same time be distributed in
a manner that best promotes access to health care to uninsured
populations.
   (2) The formula shall be based on both of the following:
   (A) A hold harmless for clinics funded in the 1997-98 fiscal year
to continue to reimburse them for some portion of their uncompensated
care.
   (B) Demonstrated unmet need by both new and existing clinics, as
reflected in their levels of uncompensated care reported to the
department.  For purposes of this article, "uncompensated care" means
clinic patient visits for persons with incomes at or below 200
percent of the federal poverty level for which there is no
encounter-based third-party reimbursement which includes, but is not
limited to, unpaid expanded access to primary care claims and other
unreimbursed visits as verified by the department according to
subparagraph (A) of paragraph (5).
   (3) In the 1998-99 fiscal year, the department shall allocate
funds for a three-year period as follows:
   (A) If the funds available for the purposes of this article are
equal to or less than the prior fiscal year, clinics that received
funding in the prior fiscal year shall receive 90 percent of their
prior fiscal year allocation, subject to available funds, provided
that funding award is substantiated by the clinics' reported levels
of uncompensated care.  The remaining funds beyond 90 percent shall
be awarded in the following order:
   (i) First priority shall be given to clinics that participated in
the program in prior fiscal years, withdrew from the program due to
financial considerations, were subsequently categorized as "new
applicants" when they reapplied to the program, and received a
significantly reduced allocation as a result.  These clinics shall be
awarded 90 percent of their allocation prior to their withdrawal
from the program, subject to available funds, provided that award
level is substantiated by the clinics' reported levels of
uncompensated care.
   (ii) Second priority shall be given to those clinics that received
program funds in the prior year and continue to meet the minimum
requirements for funding under this article.  In implementing this
priority, the department shall allocate funds to all eligible
previously funded clinics on a proportionate basis, based on their
reported levels of uncompensated care, which may include, but is not
limited to, unpaid expanded access to primary care claims and other
unreimbursed patient visits, as verified by the department according
to subparagraph (A) of paragraph (5).
   (B) If funds available for the purposes of this article are equal
to or less than the prior fiscal year, only those clinics that
received program funds in the prior fiscal year may be awarded funds.
  Funds shall be awarded in the same priority order as specified in
clauses (i) and (ii) of subparagraph (A).
   (C) If funds available for purposes of this article are greater
than the prior fiscal year, clinics that received funds in the prior
fiscal year shall be awarded 100 percent of their prior
                                fiscal year allocation, provided that
funding award level is substantiated by the clinics' reported levels
of uncompensated care.  Remaining funds shall be awarded in the
following priority order:
   (i) First priority shall be given to clinics that participated in
the program in prior fiscal years, withdrew from the program due to
financial considerations, were subsequently categorized as "new
applicants" when they reapplied to the program, and received a
significantly reduced allocation as a result.  These clinics shall be
awarded 100 percent of their allocation prior to their withdrawal
from the program, provided that award level is substantiated by the
clinics' reported levels of uncompensated care.
   (ii) Second priority shall be given to new and existing applicants
that meet the minimum requirements for funding under this article.
In implementing this priority, the department shall allocate funds to
all eligible previously funded clinics on a proportionate basis,
based on their reported levels of uncompensated care, which may
include, but is not limited to, unpaid expanded access to primary
care claims and other unreimbursed patient visits, as verified by the
department, according to subparagraph (A) of paragraph (5).
   (4) In the 2001-02 fiscal year, and subsequent fiscal years, the
department shall allocate available funds, for a three-year period,
as follows:
   (A) Clinics that received funding in the prior fiscal year shall
receive 90 percent of their prior fiscal year allocation, subject to
available funds, provided that the funding award is substantiated by
the clinics' reported levels of uncompensated care.
   (B) The remaining funds beyond 90 percent shall be awarded to new
and existing applicants based on the clinics' reported levels of
uncompensated care as verified by the department according to
subparagraph (B) of paragraph (5).  The department shall seek input
from stakeholders to discuss any adjustments to award levels that the
department deems reasonable such as including base amounts for new
applicant clinics.
   (C) New applicants shall be awarded funds pursuant to this
subdivision if they meet the minimum requirements for funding under
this article based on the clinics' reported levels of uncompensated
care as verified by the department according to subparagraph (B) of
paragraph (5).  New applicants include applicants for any new site
expansions by existing applicants.
   (D) The department shall confer with clinic representatives to
develop a funding formula for the program implemented pursuant to
this paragraph to use for allocations for the 2004-05 fiscal year and
subsequent fiscal years.
   (E) This paragraph shall become inoperative on July 1, 2004.
   (5) In assessing reported levels of uncompensated care, the
department shall utilize the most recent data available from the
Office of Statewide Health Planning and Development's (OSHPD)
completed analysis of the "Annual Report of Primary Care Clinics."
   (A) In the 1998-99 to 2000-01 fiscal years, inclusive, clinics
shall submit updated data regarding the clinics' levels of
uncompensated care to the department with their initial application,
and for each of the two remaining years in the three-year application
period.  The department shall compare the clinics' updated
uncompensated care data to the OSHPD uncompensated care data for that
clinic for the same reporting period.  Discrepancies in
uncompensated care data for any particular clinic shall be resolved
to the satisfaction of the department prior to the award of funds to
that clinic.
   (B) In the 2001-02 fiscal year, and subsequent fiscal years,
clinics may not submit updated data regarding the clinics' levels of
uncompensated care.  The department shall utilize the most recent
data available from OSHPD's completed analysis of the "Annual Report
of Primary Care Clinics."
   (C) If the funds allocated to the program are less than the prior
year, the department shall allocate available funds to existing
program providers only.
   (6) The department shall establish a base funding level, subject
to available funds, of no less than thirty-five thousand dollars
($35,000) for frontier clinics and Native American reservation-based
clinics.  For purposes of this article, "frontier clinics" means
clinics located in a medical services study area with a population of
fewer than 11 persons per square mile.
   (7) The department shall develop, in consultation with clinics
funded pursuant to this article, a formula for reallocation of unused
funds to other participating clinics to reimburse for uncompensated
care.  The department shall allocate the unused funds to other
participating clinics to reimburse for uncompensated care.
   (e) In applying for funds, eligible clinics shall submit a single
application per clinic corporation.  Applicants with multiple sites
shall apply for all eligible clinics, and shall report to the
department the allocation of funds among their corporate sites in the
prior year.  A corporation may only claim reimbursement for services
provided at a program-eligible clinic site identified in the
corporate entity's application for funds, and approved for funding by
the department.  A corporation may increase or decrease the number
of its program-eligible clinic sites on an annual basis, at the time
of the annual application update for the subsequent fiscal years of
any multiple-year application period.
   (f) Grant allocations pursuant to this article shall be based on
the formula developed by the department, notwithstanding a merger of
one of more licensed primary care clinics participating in the
program.
   (g) A clinic that is eligible for the program in every other
respect, but that provides dental services only, rather than the full
range of primary care medical services, shall only be eligible to
receive funds under this article on an exception basis.  A
dental-only provider's application shall include a Memorandum of
Understanding (MOU) with a primary care clinic funded under this
article.  The MOU shall include medical protocols for making
referrals by the primary care clinic to the dental clinic and from
the dental clinic to the primary care clinic, and ensure that case
management services are provided and that the patient is being
provided comprehensive primary care as defined in subdivision (a).
   (h) (1) For purposes of this article, an outpatient visit shall
include diagnosis and medical treatment services, including the
associated pharmacy, X-ray, and laboratory services, and prevention
health and case management services that are needed as a result of
the outpatient visit.  For a new patient, an outpatient visit shall
also include a health assessment encompassing an assessment of
smoking behavior and the patient's need for appropriate health
education specific to related tobacco use and exposure.
   (2) "Case management" includes, for this purpose, the management
of all physician services, both primary and specialty, and
arrangements for hospitalization, postdischarge care, and followup
care.
   (i) (1) Payment shall be on a per-visit basis at a rate that is
determined by the department to be appropriate for an outpatient
visit as defined in this section, and shall be not less than
seventy-one dollars and fifty cents ($71.50).
   (2) In developing a statewide uniform rate for an outpatient visit
as defined in this article, the department shall consider existing
rates of payments for comparable outpatient visits.  The department
shall review the outpatient visit rate on an annual basis.
   (j) Not later than May 1 of each year, the department shall adopt
and provide each licensed primary care clinic with a schedule for
programs under this article, including the date for notification of
availability of funds, the deadline for the submission of a completed
application, and an anticipated contract award date for successful
applicants.
   (k) In administering the program created pursuant to this article,
the department shall utilize the Medi-Cal program statutes and
regulations pertaining to program participation standards, medical
and administrative recordkeeping, the ability of the department to
monitor and audit clinic records pertaining to program services
rendered to program beneficiaries and take recoupments or recovery
actions consistent with monitoring and audit findings, and the
provider's appeal rights.  Each primary care clinic applying for
program participation shall certify that it will abide by these
statutes and regulations and other program requirements set forth in
this article.
  SEC. 140.  Section 789.8 of the Insurance Code is amended to read:

   789.8.  (a) "Elder" for purposes of this section means any person
residing in this state who is 65 years of age or older.
   (b) If a life agent offers to sell to an elder any life insurance
or annuity product, the life agent shall advise an elder or elder's
agent in writing that the sale or liquidation of any stock, bond,
IRA, certificate of deposit, mutual fund, annuity, or other asset to
fund the purchase of this product may have tax consequences, early
withdrawal penalties, or other costs or penalties as a result of the
sale or liquidation, and that the elder or elder's agent may wish to
consult independent legal or financial advice before selling or
liquidating any assets and prior to the purchase of any life or
annuity products being solicited, offered for sale, or sold.  This
section does not apply to a credit life insurance product as defined
in Section 779.2.
   (c) A life agent who offers for sale or sells a financial product
to an elder on the basis of the product's treatment under the
Medi-Cal program may not negligently misrepresent the treatment of
any asset under the statutes and rules and regulations of the
Medi-Cal program, as it pertains to the determination of the elder's
eligibility for any program of public assistance.
   (d) A life agent who offers for sale or sells any financial
product on the basis of its treatment under the Medi-Cal program
shall provide, in writing, the following disclosure to the elder or
the elder's agent:
      "NOTICE REGARDING STANDARDS FOR MEDI-CAL ELIGIBILITY

   If you or your spouse are considering purchasing a financial
product based on its treatment under the Medi-Cal program, read this
important message!
   You or your spouse do not have to use up all of your savings
before applying for Medi-Cal.
      UNMARRIED RESIDENT

   An unmarried resident may be eligible for Medi-Cal benefits if he
or she has less than (insert amount of individual's resource
allowance) in countable resources.
   The Medi-Cal recipient is allowed to keep from his or her monthly
income a personal allowance of (insert amount of personal needs
allowance) plus the amount of any health insurance premiums paid.
The remainder of the monthly income is paid to the nursing facility
as a monthly share of cost.
      MARRIED RESIDENT

   COMMUNITY SPOUSE RESOURCE ALLOWANCE:  If one spouse lives in a
nursing facility, and the other spouse does not live in a facility,
the Medi-Cal program will pay some or all of the nursing facility
costs as long as the couple together does not have more than (insert
amount of community countable assets).
   MINIMUM MONTHLY MAINTENANCE NEEDS ALLOWANCE:  If a spouse is
eligible for Medi-Cal payment of nursing facility costs, the spouse
living at home is allowed to keep a monthly income of at least his or
her individual monthly income or (insert amount of the minimum
monthly maintenance needs allowance), whichever is greater.
      FAIR HEARINGS AND COURT ORDERS

   Under certain circumstances, an at-home spouse can obtain an order
from an administrative law judge or court that will allow the
at-home spouse to retain additional resources or income.  The order
may allow the couple to retain more than (insert amount of community
spouse resource allowance plus individual's resource allowance) in
countable resources.  The order also may allow the at-home spouse to
retain more than (insert amount of the monthly maintenance needs
allowance) in monthly income.
      REAL AND PERSONAL PROPERTY EXEMPTIONS

   Many of your assets may already be exempt.  Exempt means that the
assets are not counted when determining eligibility for Medi-Cal.
      REAL PROPERTY EXEMPTIONS

   ONE PRINCIPAL RESIDENCE:  One property used as a home is exempt.
The home will remain exempt in determining eligibility if the
applicant intends to return home someday.
   The home also continues to be exempt if the applicant's spouse or
dependent relative continues to live in it.
   Money received from the sale of a home can be exempt for up to six
months if the money is going to be used for the purchase of another
home.
   REAL PROPERTY USED IN A BUSINESS OR TRADE:  Real estate used in a
trade or business is exempt regardless of its equity value and
whether it produces income.
      PERSONAL PROPERTY AND OTHER EXEMPT ASSETS

   IRAs, KEOGHs, AND OTHER WORK-RELATED PENSION PLANS:  These funds
are exempt if the family member whose name it is in does not want
Medi-Cal.  If held in the name of a person who wants Medi-Cal and
payments of principal and interest are being received, the balance is
considered unavailable and is not counted.  It is not necessary to
annuitize, convert to an annuity, or otherwise change the form of the
assets in order for them to be unavailable.

   PERSONAL PROPERTY USED IN A TRADE OR BUSINESS.

   ONE MOTOR VEHICLE.

   IRREVOCABLE BURIAL TRUSTS OR IRREVOCABLE PREPAID BURIAL CONTRACTS.

   THERE MAY BE OTHER ASSETS THAT MAY BE EXEMPT.

   This is only a brief description of the Medi-Cal eligibility
rules.  For more detailed information, you should call your county
welfare department.  Also, you are advised to contact a legal
services program for seniors or an attorney who is not connected with
the sale of this product.

   I have read the above notice and have received a copy.  Dated:
_______________ Signature:  ________________"

   The statement required in this subdivision shall be printed in at
least 12-point type, shall be clearly separate from any other
document or writing, and shall be signed by the prospective purchaser
and that person's spouse, and legal representative, if any.
   (e) The State Department of Health Services shall update this form
to ensure consistency with state and federal law and make the
disclosure available to agents and brokers through its Internet Web
site.
   (f) Nothing in this section allows or is intended to allow the
unlawful practice of law.
   (g) Subdivisions (b) and (d) shall become operative on July 1,
2001.
  SEC. 141.  Section 1215.1 of the Insurance Code is amended to read:

   1215.1.  (a) Any domestic insurer, either by itself or in
cooperation with one or more persons, may organize or acquire one or
more subsidiaries subject to the limitations of this section.
   (b) In addition to investments in common stock, preferred stock,
debt obligations, and other securities permitted under all other
sections of this chapter, a domestic insurer may also do one or more
of the following:
   (1) Invest in common stock, preferred stock, debt obligations, and
other securities of one or more subsidiaries, amounts that do not
exceed the lesser of 10 percent of the insurer's assets or 50 percent
of the insurer's surplus as regards policyholders.  However, after
these investments, the insurer's surplus as regards policyholders
shall be reasonable in relation to the insurer's outstanding
liabilities and adequate to its financial needs.  In calculating the
amount of these investments, there shall be excluded investments in
insurance subsidiaries, and there shall be included (A) total net
moneys or other consideration expended and obligations assumed in the
acquisition or formation of a subsidiary, including all
organizational expenses and contributions to capital and surplus of
the subsidiary whether or not represented by the purchase of capital
stock or issuance of other securities, and (B) all amounts expended
in acquiring additional common stock, preferred stock, debt
obligations, and other securities and all contributions to the
capital or surplus of a subsidiary subsequent to its acquisition or
formation.
   "Insurance subsidiary" is an insurer that is organized within the
United States and is controlled, directly or indirectly, by a
reporting insurer subject to this article.  For purposes of this
paragraph, "investments in insurance subsidiaries" shall include the
following:
   (A) Any direct investment in an insurance subsidiary.
   (B) The insurer's proportionate share of any investment in an
insurance subsidiary held by any subsidiary of the insurer.  This
shall be calculated by multiplying the amount of the subsidiary's
investment in the insurance subsidiary by the insurer's percentage of
ownership of the subsidiary.
   (2) If the insurer's total liabilities, as calculated for National
Association of Insurance Commissioners' annual statement purposes,
are less than 10 percent of assets, invest any amount in common
stock, preferred stock, debt obligations, and other securities of one
or more subsidiaries.  However, after this investment the insurer's
surplus as regards policyholders, considering this investment as if
it were a disallowed asset, shall be reasonable in relation to the
insurer's outstanding liabilities and adequate to its financial
needs.
   (3) Invest any amount in common stock, preferred stock, debt
obligations, and other securities of one or more subsidiaries,
provided that each subsidiary agrees to limit its investments in any
asset so that these investments will not cause the amount of the
total investment of the insurer to exceed any of the investment
limitations specified in paragraph (1) or in this chapter applicable
to the insurer.  For the purpose of this paragraph, "the total
investment of the insurer" shall include (A) any direct investment by
the insurer in an asset, and (B) the insurer's proportionate share
of any investment of an asset by any subsidiary of the insurer, which
shall be calculated by multiplying the amount of the subsidiary's
investment by the percentage of the insurer's ownership of that
subsidiary.
   (4) With the approval of the commissioner, invest any amount in
common stock, preferred stock, debt obligations, or other securities
of one or more subsidiaries, provided that after this investment the
insurer's surplus as regards policyholders shall be reasonable in
relation to the insurer's outstanding liabilities and adequate to its
financial needs.
   (5) Invest any amount in the common stock, preferred stock, debt
obligations, or other securities of any subsidiary exclusively
engaged in holding title to or holding title to and managing or
developing real or personal property, if after considering as a
disallowed asset so much of the investment as is represented by
subsidiary assets which if held directly by the insurer would be
considered as a disallowed asset, the insurer's surplus as regards
policyholders shall be reasonable in relation to the insurer's
outstanding liabilities and adequate to its financial needs.
   (c) Investments in common stock, preferred stock, debt
obligations, or other securities of subsidiaries made pursuant to
subdivision (b) shall neither limit nor be subject to any of the
otherwise applicable authorizations, restrictions, or prohibitions
contained in this part applicable to these investments of insurers.
   (d) Whether any investment pursuant to subdivision (b) meets the
applicable requirements thereof is to be determined immediately after
the investment is made, taking into account the then outstanding
principal balance on all previous investments in debt obligations,
and the value of all previous investments in equity securities as of
the date they were made.
   (e) If an insurer ceases to control a subsidiary, it shall dispose
of any investment therein made pursuant to this section within three
years from the time of the cessation of control, or within any
further time as the commissioner may prescribe, unless at any time
after the investment has been made, the investment has met the
requirements for investment under any other section of this part.
  SEC. 142.  Section 1871 of the Insurance Code is amended to read:
   1871.  The Legislature finds and declares as follows:
   (a) The business of insurance involves many transactions that have
the potential for abuse and illegal activities.  There are numerous
law enforcement agencies on the state and local levels charged with
the responsibility for investigating and prosecuting fraudulent
activity.  This chapter is intended to permit the full utilization of
the expertise of the commissioner and the department so that they
may more effectively investigate and discover insurance frauds, halt
fraudulent activities, and assist and receive assistance from
federal, state, local, and administrative law enforcement agencies in
the prosecution of persons who are parties in insurance frauds.
   (b) Insurance fraud is a particular problem for automobile
policyholders; fraudulent activities account for 15 to 20 percent of
all auto insurance payments.  Automobile insurance fraud is the
biggest and fastest growing segment of insurance fraud and
contributes substantially to the high cost of automobile insurance
with particular significance in urban areas.
   (c) Prevention of automobile insurance fraud will significantly
reduce the incidence of severity and automobile insurance claim
payments and will therefore produce a commensurate reduction in
automobile insurance premiums.
   (d) Workers' compensation fraud harms employers by contributing to
the increasingly high cost of workers' compensation insurance and
self-insurance and harms employees by undermining the perceived
legitimacy of all workers' compensation claims.
   (e) Prevention of workers' compensation insurance fraud may reduce
the number of workers' compensation claims and claim payments
thereby producing a commensurate reduction in workers' compensation
costs.  Prevention of workers' compensation insurance fraud will
assist in restoring confidence and faith in the workers' compensation
system, and will facilitate expedient and full compensation for
employees injured at the workplace.
   (f) The actions of employers who fraudulently underreport payroll
or fail to report payroll for all employees to their insurance
company in order to pay a lower workers' compensation premium result
in significant additional premium costs and an unfair burden to
honest employers and their employees.
   (g) Health insurance fraud is a particular problem for health
insurance policyholders.  Although there are no precise figures, it
is believed that fraudulent activities account for billions of
dollars annually in added health care costs nationally.  Health care
fraud causes losses in premium dollars and increases health care
costs unnecessarily.
  SEC. 143.  Section 1872.83 of the Insurance Code is amended to
read:
   1872.83.  (a) The commissioner shall ensure that the Bureau of
Fraudulent Claims aggressively pursues all reported incidents of
probable workers' compensation fraud, as defined in Sections 11760
and 11880, in subdivision (a) of Section 1871.4, and in Section 549
of the Penal Code, and forwards to the appropriate disciplinary body
the names, along with all supporting evidence, of any individuals
licensed under the Business and Professions Code who are suspected of
actively engaging in fraudulent activity.  The Bureau of Fraudulent
Claims shall forward to the Insurance Commissioner or the Director of
Industrial Relations, as appropriate, the name, along with all
supporting evidence, of any insurer, as defined in subdivision (c) of
Section 1877.1, suspected of actively engaging in the fraudulent
denial of claims.
   (b) To fund increased investigation and prosecution of workers'
compensation fraud, there shall be an annual assessment as follows:
   (1) The aggregate amount of the assessment shall be determined by
the Fraud Assessment Commission, which is hereby established.  The
commission shall be composed of five members consisting of two
representatives of self-insured employers, one representative of
insured employers, one representative of workers' compensation
insurers, and the President of the State Compensation Insurance Fund,
or his or her designee.
   The Governor shall appoint members representing self-insured
employers, insured employers, and insurers.  The term of office of
members of the commission shall be four years, and a member shall
hold office until the appointment of a successor.  However, the
initial terms of three of the members appointed by the Governor shall
expire, respectively, on December 31, 1992, December 31, 1993, and
December 31, 1994.  The President of the State Compensation Insurance
Fund shall be an ex officio, voting member of the commission.
Members of the commission shall receive one hundred dollars ($100)
for each day of actual attendance at commission meetings and other
official commission business, and shall also receive their actual and
necessary traveling expenses incurred in the performance of
commission duties.  Payment of per diem and travel expenses shall be
made from the Workers' Compensation Fraud Account in the Insurance
Fund, established in paragraph (4), upon appropriation by the
Legislature.
   (2) In determining the aggregate amount of the assessment, the
Fraud Assessment Commission shall consider the advice and
recommendations of the Bureau of Fraudulent Claims and the
commissioner.
   (3) The aggregate amount of the assessment shall be collected by
the Director of Industrial Relations pursuant to Section 62.6 of the
Labor Code.  The Fraud Assessment Commission shall annually advise
the Director of Industrial Relations, not later than March 15, of the
aggregate amount to be assessed for the next fiscal year.
   (4) The amount collected, together with the fines collected for
violations of the unlawful acts specified in Sections 1871.4, 11760,
and 11880, and Section 549 of the Penal Code, shall be deposited in
the Workers' Compensation Fraud Account in the Insurance Fund, which
is hereby created, and may be used, upon appropriation by the
Legislature, only for enhanced workers' compensation fraud
investigation and prosecution as provided in this section.
   (c) For each fiscal year, the total amount of revenues derived
from the assessment pursuant to subdivision (b) shall, together with
amounts collected pursuant to fines imposed for unlawful acts
described in Sections 1871.4, 11760, and 11880, and Section 549 of
the Penal Code, not be less than three million dollars ($3,000,000)
                                          .  Any funds appropriated
by the Legislature pursuant to subdivision (b) that are not expended
in the fiscal year for which they have been appropriated, and that
have not been allocated under subdivision (f), shall be applied to
satisfy for the immediately following fiscal year the minimum total
amount required by this subdivision.  In no case may that money be
transferred to the General Fund.
   (d) After incidental expenses, at least 40 percent of the funds to
be used for the purposes of this section shall be provided to the
Bureau of Fraudulent Claims of the Department of Insurance for
enhanced investigative efforts, and at least 40 percent of the funds
shall be distributed to district attorneys, pursuant to a
determination by the commissioner with the advice and consent of the
bureau and the Fraud Assessment Commission, as to the most effective
distribution of moneys for purposes of the investigation and
prosecution of workers' compensation insurance fraud cases.  Each
district attorney seeking a portion of the funds shall submit to the
commissioner an application setting forth in detail the proposed use
of any funds provided.  A district attorney receiving funds pursuant
to this subdivision shall submit an annual report to the commissioner
with respect to the success of his or her efforts.  Upon receipt,
the commissioner shall provide copies to the bureau and the Fraud
Assessment Commission of any application, annual report, or other
documents with respect to the allocation of money pursuant to this
subdivision.   Both the application for moneys and the distribution
of moneys shall be public documents.  Information submitted to the
commissioner pursuant to this section concerning criminal
investigations, whether active or inactive, shall be confidential.
   (e) If a district attorney is determined by the commissioner to be
unable or unwilling to investigate and prosecute workers'
compensation fraud claims, the commissioner shall discontinue
distribution of funds allocated for that county and may redistribute
those funds according to this subdivision.
   (1) The commissioner shall promptly determine whether any other
county could assert jurisdiction to prosecute the fraud claims that
would have been brought in the nonparticipating county, and if so,
the commissioner may award funds to conduct the prosecutions
redirected pursuant to this subdivision.  These funds may be in
addition to any other fraud prosecution funds otherwise awarded under
this section.  Any district attorney receiving funds pursuant to
this subdivision shall first agree that the funds shall be used
solely for investigating and prosecuting those cases of workers'
compensation fraud redirected pursuant to this subdivision and submit
an annual report to the commissioner with respect to the success of
the district attorney's efforts.  The commissioner shall keep the
Fraud Assessment Commission fully informed of all reallocations of
funds under this paragraph.
   (2) If the commissioner determines that no district attorney is
willing or able to investigate and prosecute the workers'
compensation fraud claims arising in the nonparticipating county, the
commissioner, with the advice and consent of the Fraud Assessment
Commission, may award to the Attorney General some or all of the
funds previously awarded to the nonparticipating county.  Before the
commissioner may award any funds, the Attorney General shall submit
to the commissioner an application setting forth in detail his or her
proposed use of any funds provided and agreeing that any funds
awarded shall be used solely for investigating and prosecuting those
cases of workers' compensation fraud redirected pursuant to this
subdivision.  The Attorney General shall submit an annual report to
the commissioner with respect to the success of the fraud prosecution
efforts of his or her office.
   (3) Neither the Attorney General nor any district attorney shall
be required to relinquish control of any investigation or prosecution
undertaken pursuant to this subdivision unless the commissioner
determines that satisfactory progress is no longer being made on the
case or the case has been abandoned.
   (4) A county that has become a nonparticipating county due to the
inability or unwillingness of its district attorney to investigate
and prosecute workers' compensation fraud may not become eligible to
receive funding under this section until it has submitted a new
application that meets the requirements of subdivision (d) and the
applicable regulations.
   (f) If in any fiscal year the Bureau of Fraudulent Claims does not
use all of the funds made available to it under subdivision (d), any
remaining funds may be distributed to district attorneys pursuant to
a determination by the commissioner in accordance with the same
procedures set forth in subdivision (d).
   (g) The commissioner shall adopt rules and regulations to
implement this section in accordance with the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code).  Included in the
rules and regulations shall be the criteria for redistributing funds
to district attorneys and the Attorney General.  The adoption of the
rules and regulations shall be deemed to be an emergency and
necessary for the immediate preservation of the public peace, health,
and safety, or general welfare.
   (h) The department shall report on an annual basis to the
Legislature and the Fraud Assessment Commission on the activities of
the Bureau of Fraudulent Claims and district attorneys supported by
the funds provided by this section.
   The annual report shall include, but is not limited to, all of the
following information for the department and each district attorney'
s office:
   (1) All allocations, distributions, and expenditures of funds.
   (2) The number of search warrants issued.
   (3) The number of arrests and prosecutions, and the aggregate
number of parties involved in each.
   (4) The number of convictions and the names of all convicted fraud
perpetrators.
   (5) The estimated value of all assets frozen, penalties assessed,
and restitutions made for each conviction.
   (6) Any additional items necessary to fully inform the Fraud
Assessment Commission and the Legislature of the fraud-fighting
efforts financed through this section.
   (i) In order to meet the requirements of subdivision (g), the
department shall submit a biannual information request to those
district attorneys who have applied for and received funding through
the annual assessment process under this section.
   (j) Assessments levied or collected to fight workers' compensation
fraud and insurance fraud are not taxes.  Those funds are entrusted
to the state to fight fraud by funding state and local investigation
and prosecution efforts.  Accordingly, any funds resulting from
assessments, fees, penalties, fines, restitution, or recovery of
costs of investigation and prosecution deposited in the Insurance
Fund shall not be deemed "unexpended" funds for any purpose and, if
remaining in that account at the end of any fiscal year, shall be
applied as provided in subdivision (f) and to offset or augment
subsequent years' program funding.
  SEC. 144.  Section 10123.135 of the Insurance Code is amended to
read:
   10123.135.  (a) Every disability insurer, or an entity with which
it contracts for services that include utilization review or
utilization management functions, that covers hospital, medical, or
surgical expenses and that prospectively, retrospectively, or
concurrently reviews and approves, modifies, delays, or denies, based
in whole or in part on medical necessity, requests by providers
prior to, retrospectively, or concurrent with the provision of health
care services to insureds, or that delegates these functions to
medical groups or independent practice associations or to other
contracting providers, shall comply with this section.
   (b) A disability insurer that is subject to this section, or any
entity with which an insurer contracts for services that include
utilization review or utilization management functions, shall have
written policies and procedures establishing the process by which the
insurer prospectively, retrospectively, or concurrently reviews and
approves, modifies, delays, or denies, based in whole or in part on
medical necessity, requests by providers of health care services for
insureds.  These policies and procedures shall ensure that decisions
based on the medical necessity of proposed health care services are
consistent with criteria or guidelines that are supported by clinical
principles and processes.  These criteria and guidelines shall be
developed pursuant to subdivision (f).  These policies and
procedures, and a description of the process by which an insurer, or
an entity with which an insurer contracts for services that include
utilization review or utilization management functions, reviews and
approves, modifies, delays, or denies requests by providers prior to,
retrospectively, or concurrent with the provision of health care
services to insureds, shall be filed with the commissioner, and shall
be disclosed by the insurer to insureds and providers upon request,
and by the insurer to the public upon request.
   (c) If the number of insureds covered under health benefit plans
in this state that are issued by an insurer subject to this section
constitute at least 50 percent of the number of insureds covered
under health benefit plans issued nationwide by that insurer, the
insurer shall employ or designate a medical director who holds an
unrestricted license to practice medicine in this state issued
pursuant to Section 2050 of the Business and Professions Code or the
Osteopathic Initiative Act, or the insurer may employ a clinical
director licensed in California whose scope of practice under
California law includes the right to independently perform all those
services covered by the insurer.  The medical director or clinical
director shall ensure that the process by which the insurer reviews
and approves, modifies, delays, or denies, based in whole or in part
on medical necessity, requests by providers prior to,
retrospectively, or concurrent with the provision of health care
services to insureds, complies with the requirements of this section.
  Nothing in this subdivision shall be construed as restricting the
existing authority of the Medical Board of California.
   (d) If an insurer subject to this section, or individuals under
contract to the insurer to review requests by providers, approve the
provider's request pursuant to subdivision (b), the decision shall be
communicated to the provider pursuant to subdivision (h).
   (e) An individual, other than a licensed physician or a licensed
health care professional who is competent to evaluate the specific
clinical issues involved in the health care services requested by the
provider, may not deny or modify requests for authorization of
health care services for an insured for reasons of medical necessity.
  The decision of the physician or other health care provider shall
be communicated to the provider and the insured pursuant to
subdivision (h).
   (f) (1) An insurer shall disclose, or provide for the disclosure,
to the commissioner and to network providers, the process the
insurer, its contracting provider groups, or any entity with which it
contracts for services that include utilization review or
utilization management functions, uses to authorize, delay, modify,
or deny health care services under the benefits provided by the
insurance contract, including coverage for subacute care,
transitional inpatient care, or care provided in skilled nursing
facilities.  An insurer shall also disclose those processes to
policyholders or persons designated by a policyholder, or to any
other person or organization, upon request.
   (2) The criteria or guidelines used by an insurer, or an entity
with which an insurer contracts for utilization review or utilization
management functions, to determine whether to authorize, modify,
delay, or deny health care services, shall comply with all of the
following:
   (A) Be developed with involvement from actively practicing health
care providers.
   (B) Be consistent with sound clinical principles and processes.
   (C) Be evaluated, and updated if necessary, at least annually.
   (D) If used as the basis of a decision to modify, delay, or deny
services in a specified case under review, be disclosed to the
provider and the policyholder in that specified case.
   (E) Be available to the public upon request.  An insurer shall
only be required to disclose the criteria or guidelines for the
specific procedures or conditions requested.  An insurer may charge
reasonable fees to cover administrative expenses related to
disclosing criteria or guidelines pursuant to this paragraph that are
limited to copying and postage costs.  The insurer may also make the
criteria or guidelines available through electronic communication
means.
   (3) The disclosure required by subparagraph (E) of paragraph (2)
shall be accompanied by the following notice:  "The materials
provided to you are guidelines used by this insurer to authorize,
modify, or deny health care benefits for persons with similar
illnesses or conditions.  Specific care and treatment may vary
depending on individual need and the benefits covered under your
insurance contract."
   (g) If an insurer subject to this section requests medical
information from providers in order to determine whether to approve,
modify, or deny requests for authorization, the insurer shall request
only the information reasonably necessary to make the determination.

   (h) In determining whether to approve, modify, or deny requests by
providers prior to, retrospectively, or concurrent with the
provision of health care services to insureds, based in whole or in
part on medical necessity, every insurer subject to this section
shall meet the following requirements:
   (1) Decisions to approve, modify, or deny, based on medical
necessity, requests by providers prior to, or concurrent with, the
provision of health care services to insureds that do not meet the
requirements for the 72-hour review required by paragraph (2), shall
be made in a timely fashion appropriate for the nature of the insured'
s condition, not to exceed five business days from the insurer's
receipt of the information reasonably necessary and requested by the
insurer to make the determination.  In cases where the review is
retrospective, the decision shall be communicated to the individual
who received services, or to the individual's designee, within 30
days of the receipt of information that is reasonably necessary to
make this determination, and shall be communicated to the provider in
a manner that is consistent with current law.  For purposes of this
section, retrospective reviews shall be for care rendered on or after
January 1, 2000.
   (2) When the insured's condition is such that the insured faces an
imminent and serious threat to his or her health, including, but not
limited to, the potential loss of life, limb, or other major bodily
function, or the normal timeframe for the decisionmaking process, as
described in paragraph (1), would be detrimental to the insured's
life or health or could jeopardize the insured's ability to regain
maximum function, decisions to approve, modify, or deny requests by
providers prior to, or concurrent with, the provision of health care
services to insureds shall be made in a timely fashion, appropriate
for the nature of the insured's condition, but not to exceed 72 hours
after the insurer's receipt of the information reasonably necessary
and requested by the insurer to make the determination.
   (3) Decisions to approve, modify, or deny requests by providers
for authorization prior to, or concurrent with, the provision of
health care services to insureds shall be communicated to the
requesting provider within 24 hours of the decision.  Except for
concurrent review decisions pertaining to care that is underway,
which shall be communicated to the insured's treating provider within
24 hours, decisions resulting in denial, delay, or modification of
all or part of the requested health care service shall be
communicated to the insured in writing within two business days of
the decision.  In the case of concurrent review, care shall not be
discontinued until the insured's treating provider has been notified
of the insurer's decision and a care plan has been agreed upon by the
treating provider that is appropriate for the medical needs of that
patient.
   (4) Communications regarding decisions to approve requests by
providers prior to, retrospectively, or concurrent with the provision
of health care services to insureds shall specify the specific
health care service approved.  Responses regarding decisions to deny,
delay, or modify health care services requested by providers prior
to, retrospectively, or concurrent with the provision of health care
services to insureds shall be communicated to insureds in writing,
and to providers initially by telephone or facsimile, except with
regard to decisions rendered retrospectively, and then in writing,
and shall include a clear and concise explanation of the reasons for
the insurer's decision, a description of the criteria or guidelines
used, and the clinical reasons for the decisions regarding medical
necessity.  Any written communication to a physician or other health
care provider of a denial, delay, or modification or a request shall
include the name and telephone number of the health care professional
responsible for the denial, delay, or modification.  The telephone
number provided shall be a direct number or an extension, to allow
the physician or health care provider easily to contact the
professional responsible for the denial, delay, or modification.
Responses shall also include information as to how the provider or
the insured may file an appeal with the insurer or seek department
review under the unfair practices provisions of Article 6.5
(commencing with Section 790) of Chapter 1 of Part 2 of Division 1
and the regulations adopted thereunder.
   (5) If the insurer cannot make a decision to approve, modify, or
deny the request for authorization within the timeframes specified in
paragraph (1) or (2) because the insurer is not in receipt of all of
the information reasonably necessary and requested, or because the
insurer requires consultation by an expert reviewer, or because the
insurer has asked that an additional examination or test be performed
upon the insured, provided that the examination or test is
reasonable and consistent with good medical practice, the insurer
shall, immediately upon the expiration of the timeframe specified in
paragraph (1) or (2), or as soon as the insurer becomes aware that it
will not meet the timeframe, whichever occurs first, notify the
provider and the insured, in writing, that the insurer cannot make a
decision to approve, modify, or deny the request for authorization
within the required timeframe, and specify the information requested
but not received, or the expert reviewer to be consulted, or the
additional examinations or tests required.  The insurer shall also
notify the provider and enrollee of the anticipated date on which a
decision may be rendered.  Upon receipt of all information reasonably
necessary and requested by the insurer, the insurer shall approve,
modify, or deny the request for authorization within the timeframes
specified in paragraph (1) or (2), whichever applies.
   (6) If the commissioner determines that an insurer has failed to
meet any of the timeframes in this section, or has failed to meet any
other requirement of this section, the commissioner may assess, by
order, administrative penalties for each failure.  A proceeding for
the issuance of an order assessing administrative penalties shall be
subject to appropriate notice to, and an opportunity for a hearing
with regard to, the person affected.  The administrative penalties
shall not be deemed an exclusive remedy for the commissioner.  These
penalties shall be paid to the Insurance Fund.
   (i) Every insurer subject to this section shall maintain telephone
access for providers to request authorization for health care
services.
   (j) Nothing in this section shall cause a disability insurer to be
defined as a health care provider for purposes of any provision of
law, including, but not limited to, Section 6146 of the Business and
Professions Code, Sections 3333.1 and 3333.2 of the Civil Code, and
Sections 340.5, 364, 425.13, 667.7, and 1295 of the Code of Civil
Procedure.
  SEC. 145.  Section 10178.3 of the Insurance Code is amended to
read:
   10178.3.  (a) In order to prevent the improper selling, leasing,
or transferring of a health care provider's contract, it is the
intent of the Legislature that every arrangement that results in a
payor paying a health care provider a reduced rate for health care
services based on the health care provider's participation in a
network or panel shall be disclosed to the provider in advance and
that the payor shall actively encourage beneficiaries to use the
network, unless the health care provider agrees to provide discounts
without that active encouragement.
   (b) Beginning July 1, 2000, every contracting agent that sells,
leases, assigns, transfers, or conveys its list of contracted health
care providers and their contracted reimbursement rates to a payor,
as defined in subparagraph (A) of paragraph (3) of subdivision (d),
or another contracting agent shall, upon entering or renewing a
provider contract, do all of the following:
   (1) Disclose whether the list of contracted providers may be sold,
leased, transferred, or conveyed to other payors or other
contracting agents, and specify whether those payors or contracting
agents include workers' compensation insurers or automobile insurers.

   (2) Disclose what specific practices, if any, payors utilize to
actively encourage a payor's beneficiaries to use the list of
contracted providers when obtaining medical care that entitles a
payor to claim a contracted rate.  For purposes of this paragraph, a
payor is deemed to have actively encouraged its beneficiaries to use
the list of contracted providers if one of the following occurs:
   (A) The payor's contract with subscribers or insureds offers
beneficiaries direct financial incentives to use the list of
contracted providers when obtaining medical care.  "Financial
incentives" means reduced copayments, reduced deductibles, premium
discounts directly attributable to the use of a provider panel, or
financial penalties directly attributable to the nonuse of a provider
panel.
   (B) The payor provides information to its beneficiaries, who are
parties to the contract, or, in the case of workers' compensation
insurance, the employer, advising them of the existence of the list
of contracted providers through the use of a variety of advertising
or marketing approaches that supply the names, addresses, and
telephone numbers of contracted providers to beneficiaries in advance
of their selection of a health care provider, which approaches may
include, but are not limited to, the use of provider directories, or
the use of toll-free telephone numbers or Internet Web site addresses
supplied directly to every beneficiary.  However, Internet Web site
addresses alone shall not be deemed to satisfy the requirements of
this subparagraph.  Nothing in this subparagraph shall prevent
contracting agents or payors from providing only listings of
providers located within a reasonable geographic range of a
beneficiary.
   (3) Disclose whether payors to which the list of contracted
providers may be sold, leased, transferred, or conveyed may be
permitted to pay a provider's contracted rate without actively
encouraging the payors' beneficiaries to use the list of contracted
providers when obtaining medical care.  Nothing in this subdivision
shall be construed to require a payor to actively encourage the payor'
s beneficiaries to use the list of contracted providers when
obtaining medical care in the case of an emergency.
   (4) Disclose, upon the initial signing of a contract, and within
30 calendar days of receipt of a written request from a provider or
provider panel, a payor summary of all payors currently eligible to
claim a provider's contracted rate due to the provider's and payor's
respective written agreements with any contracting agent.
   (5) Allow providers, upon the initial signing, renewal, or
amendment of a provider contract, to decline to be included in any
list of contracted providers that is sold, leased, transferred, or
conveyed to payors that do not actively encourage the payors'
beneficiaries to use the list of contracted providers when obtaining
medical care as described in paragraph (2).  Each provider's election
under this paragraph shall be binding on the contracting agent with
which the provider has a contract and any other contracting agent
that buys, leases, or otherwise obtains the list of contracted
providers.  A provider shall not be excluded from any list of
contracted providers that is sold, leased, transferred, or conveyed
to payors that actively encourage the payors' beneficiaries to use
the list of contracted providers when obtaining medical care, based
upon the provider's refusal to be included on any list of contracted
providers that is sold, leased, transferred, or conveyed to payors
that do not actively encourage the payors' beneficiaries to use the
list of contracted providers when obtaining medical care.
   (6) Nothing in this subdivision shall be construed to impose
requirements or regulations upon payors, as defined in subparagraph
(A) of paragraph (3) of subdivision (d).
   (c) Beginning July 1, 2000, a payor, as defined in subparagraph
(B) of paragraph (3) of subdivision (d), shall do all of the
following:
   (1) Provide an explanation of benefits or explanation of review
that identifies the name of the network that has a written agreement
signed by the provider whereby the payor is entitled, directly or
indirectly, to pay a preferred rate for the services rendered.
   (2) Demonstrate that it is entitled to pay a contracted rate
within 30 business days of receipt of a written request from a
provider who has received a claim payment from the payor.  The
failure of a payor to make the demonstration within 30 business days
shall render the payor responsible for the amount that the payor
would have been required to pay pursuant to the beneficiary's policy
with the payor, which amount shall be due and payable within 10
business days of receipt of written notice from the provider, and
shall bar the payor from taking any future
                        discounts from that provider without the
provider's express written consent until the payor can demonstrate to
the provider that it is entitled to pay a contracted rate as
provided in this subdivision.  A payor shall be deemed to have
demonstrated that it is entitled to pay a contracted rate if it
complies with either of the following:
   (A) Discloses the name of the network that has a written agreement
with the provider whereby the provider agrees to accept discounted
rates, and describes the specific practices the payor utilizes to
comply with paragraph (2) of subdivision (b).
   (B) Identifies the provider's written agreement with a contracting
agent whereby the provider agrees to be included on lists of
contracted providers sold, leased, transferred, or conveyed to payors
that do not actively encourage beneficiaries to use the list of
contracted providers pursuant to paragraph (5) of subdivision (b).
   (d) For the purposes of this section, the following terms have the
following meanings:
   (1) "Beneficiary" means:
   (A) For automobile insurance, those persons covered under the
medical payments portion of the insurance contract.
   (B) For group or individual health services covered through a
health care service plan contract, including a specialized health
care service plan contract, or a policy of disability insurance that
covers hospital, medical, or surgical benefits, a subscriber, an
enrollee, a policyholder, or an insured.
   (C) For workers' compensation insurance, an employee seeking
health care services for a work-related injury.
   (2) "Contracting agent" means an insurer licensed under this code
to provide disability insurance that covers hospital, medical, or
surgical benefits, automobile insurance, or workers' compensation
insurance, while engaged, for monetary or other consideration, in the
act of selling, leasing, transferring, assigning, or conveying a
provider or provider panel to provide health care services to
beneficiaries.
   (3) (A) For the purposes of subdivision (b), "payor" means a
health care service plan, including a specialized health care service
plan, an insurer licensed under this code to provide disability
insurance that covers hospital, medical, or surgical benefits,
automobile insurance, or workers' compensation insurance, or a
self-insured employer that is responsible to pay for health care
services provided to beneficiaries.
   (B) For the purposes of subdivision (c), "payor" means only an
insurer licensed under this code to provide disability insurance that
covers hospital, medical, or surgical benefits, or automobile
insurance, if that insurer is responsible to pay for health care
services provided to beneficiaries.
   (4) "Payor summary" means a written summary that includes the
payor's name and the type of plan, including, but not limited to, a
group health plan, an automobile insurance plan, and a workers'
compensation insurance plan.
   (5) "Provider" means any of the following:
   (A) Any person licensed or certified pursuant to Division 2
(commencing with Section 500) of the Business and Professions Code.
   (B) Any person licensed pursuant to the Chiropractic Initiative
Act or the Osteopathic Initiative Act.
   (C) Any person licensed pursuant to Chapter 2.5 (commencing with
Section 1440) of Division 2 of the Health and Safety Code.
   (D) A clinic, health dispensary, or health facility licensed
pursuant to Division 2 (commencing with Section 1200) of the Health
and Safety Code.
   (E) Any entity exempt from licensure pursuant to Section 1206 of
the Health and Safety Code.
   (e) This section shall become operative on July 1, 2000.
  SEC. 146.  Section 10192.11 of the Insurance Code is amended to
read:
   10192.11.  (a) An issuer shall not deny or condition the issuance
or effectiveness of any Medicare supplement policy or certificate
available for sale in this state, nor discriminate in the pricing of
a policy or certificate because of the health status, claims
experience, receipt of health care, or medical condition of an
applicant in the case of an application for a policy or certificate
that is submitted prior to or during the six-month period beginning
with the first day of the first month in which an individual is both
65 years of age or older and is enrolled for benefits under Medicare
Part B.  Each Medicare supplement policy and certificate currently
available from an issuer shall be made available to all applicants
who qualify under this subdivision and are 65 years of age or older.
Medicare supplement contracts A, B, C, F, and at least one
letter-designated plan (H, I, or J, at the discretion of the issuer)
that includes coverage for prescription medications, if currently
available from an issuer, shall be made available to any applicant
who qualifies under this subdivision who is 64 years of age or
younger and who does not have End-Stage Renal Disease.  This section
does not prohibit an issuer in determining premium rates from
treating applicants who are under 65 years of age and are eligible
for Medicare Part B as a separate risk classification.  This section
shall not be construed as preventing the exclusion of benefits for
preexisting conditions as defined in paragraph (1) of subdivision (a)
of Section 10192.8.
   (b) (1) If an applicant qualifies under subdivision (a) and
submits an application during the time period referenced in
subdivision (a) and, as of the date of application, has had a
continuous period of creditable coverage of at least six months, the
issuer shall not exclude benefits based on a preexisting condition.
   (2) If the applicant qualifies under subdivision (a) and submits
an application during the time period referenced in subdivision (a)
and, as of the date of application, has had a continuous period of
creditable coverage that is less than six months, the issuer shall
reduce the period of any preexisting condition exclusion by the
aggregate of the period of creditable coverage applicable to the
applicant as of the enrollment date.  The manner of the reduction
under this subdivision shall be as specified by the commissioner.
   (c) Except as provided in subdivision (b) and Section 10192.23,
subdivision (a) shall not be construed as preventing the exclusion of
benefits under a policy, during the first six months, based on a
preexisting condition for which the policyholder or certificate
holder received treatment or was otherwise diagnosed during the six
months before the coverage became effective.
   (d) An individual enrolled in Medicare Part B by reason of
disability will be entitled to open enrollment described in this
section for six months after he or she first becomes eligible for
Medicare Part B.  Every issuer shall make available to every
applicant qualified for open enrollment all policies and certificates
offered by that issuer at the time of application.  Issuers shall
not discourage sales during the open enrollment period by any means,
including the altering of the commission structure.
   There shall be a one-time open enrollment period of 120 days
commencing on January 1, 2001, for all individuals eligible for
Medicare by reason of disability who do not have End-Stage Renal
Disease.
   (e) An individual who is 65 years of age or older and enrolled in
Medicare Part B is entitled to open enrollment described in this
section for six months following:
   (1) Receipt of a notice of termination or, if no notice is
received, the effective date of termination, from any
employer-sponsored health plan including an employer-sponsored
retiree health plan.  For purposes of this section,
"employer-sponsored retiree health plan" includes any coverage for
medical expenses that is directly or indirectly sponsored or
established by an employer for employees or retirees, their spouses,
dependents, or other included insureds.
   (2) Termination of health care services for a military retiree or
the retiree's Medicare eligible spouse or dependent as a result of a
military base closure.
   (f) An individual who is 65 years of age or older and enrolled in
Medicare Part B is entitled to open enrollment described in this
section if the individual was covered under a policy, certificate, or
contract providing Medicare supplement coverage but that coverage
terminated because the individual established residence at a location
not served by the plan.
   (g) (1) An individual who was previously enrolled but whose
coverage was terminated between September 1, 1998, and December 31,
1998, by a Medicare managed care plan shall be entitled to a new
60-day open enrollment period in addition to any open enrollment
authorized by federal law or regulation, for any Medicare supplement
coverage provided by Medicare supplement insurers and available on a
guaranteed basis under state and federal law or regulation for
persons terminated by their Medicare managed care plan.
   (2) The new open enrollment period specified in paragraph (1)
shall commence 90 days after January 1, 2000.
   (3) An individual who was previously enrolled but whose coverage
was terminated after January 1, 1999, by a Medicare managed care plan
shall be entitled to an additional 60-day open enrollment period to
be added on to and run consecutively after any open enrollment period
authorized by federal law or regulation, for any Medicare supplement
coverage provided by Medicare supplement insurers and available on a
guaranteed basis under state and federal law or regulation for
persons terminated by their Medicare managed care plan.  An
individual shall be entitled to an annual open enrollment period
lasting 30 days or more, commencing with the individual's birthday,
during which time that person may purchase any Medicare supplement
policy, with the exception of a Medicare Select policy, that offers
benefits equal to or lesser than those provided by the previous
coverage.  During this open enrollment period, no issuer that falls
under this provision shall deny or condition the issuance or
effectiveness of Medicare supplement coverage, nor discriminate in
the pricing of coverage, because of health status, claims experience,
receipt of health care, or medical condition of the individual if,
at the time of the open enrollment period, the individual is covered
under another Medicare supplement policy or contract.  An issuer
shall notify a policyholder of his or her rights under this
subdivision at least 30 and no more than 60 days before the beginning
of the open enrollment period.
  SEC. 147.  Section 10231.2 of the Insurance Code is amended to
read:
   10231.2.  "Long-term care insurance" includes any insurance
policy, certificate, or rider advertised, marketed, offered,
solicited, or designed to provide coverage for diagnostic,
preventive, therapeutic, rehabilitative, maintenance, or personal
care services that are provided in a setting other than an acute care
unit of a hospital.  Long-term care insurance includes all products
containing any of the following benefit types:  coverage for
institutional care including care in a nursing home, convalescent
facility, extended care facility, custodial care facility, skilled
nursing facility, or personal care home; home care coverage including
home health care, personal care, homemaker services, hospice, or
respite care; or community-based coverage including adult day care,
hospice, or respite care.  Long-term care insurance includes
disability based long-term care policies but does not include
insurance designed primarily to provide Medicare supplement or major
medical expense coverage.
   Long-term care policies, certificates, and riders shall be
regulated under this chapter.  The commissioner shall review and
approve individual and group policies, certificates, riders, and
outlines of coverage.  Other applicable laws and regulations shall
also apply to long-term care insurance insofar as they do not
conflict with the provisions in this chapter.  Long-term care
benefits designed to provide coverage of 12 months or more that are
contained in or amended to Medicare supplement or other disability
policies and certificates shall be regulated under this chapter.
  SEC. 148.  Section 10236 of the Insurance Code is amended to read:

   10236.  Every individual and group long-term care policy and
certificate under a group long-term care policy shall be either
guaranteed renewable or noncancelable.
   (a) "Guaranteed renewable" means that the insured has the right to
continue coverage in force if premiums are timely paid during which
period the insurer may not unilaterally change the terms of coverage
or decline to renew, except that the insurer may, in accordance with
provisions in the policy, and in accordance with Section 10236.1,
change the premium rates to all insureds in the same class.  The
"class" is determined by the insurer for the purpose of setting rates
at the time the policy is issued.
   (b) "Noncancelable" means the insured has the right to continue
the coverage in force if premiums are timely paid during which period
the insurer may not unilaterally change the terms of coverage,
decline to renew, or change the premium rate.
   (c) Every long-term care policy and certificate shall contain an
appropriately captioned renewability provision on page one, which
shall clearly describe the initial term of coverage, the conditions
for renewal, and, if guaranteed renewable, a description of the class
and of each circumstance under which the insurer may change the
premium amount.
  SEC. 149.  Section 10506.5 of the Insurance Code is amended to
read:
   10506.5.  (a) For the purposes of this section, "guaranteed living
benefit" means a benefit in a variable annuity or a variable life
insurance contract providing that one or more benefit amounts
available to a living contractholder, under specified conditions,
will be enhanced should it fall below a given level, in the absence
of the guaranteed living benefit.
   (b) An insurer may deliver or issue for delivery contracts
containing, or riders to variable contracts providing, guaranteed
living benefits if all the following requirements are met:
   (1) The insurer is authorized to deliver, or issue for delivery,
variable insurance products in this state.
   (2) The insurer meets the requirements of paragraph (1) of
subdivision (d) of Section 10506.4.
   (3) The commissioner has issued a bulletin setting forth the terms
and conditions under which variable contracts containing, or riders
to variable contracts providing, guaranteed living benefits may be
issued or delivered in this state.
   (4) The variable contract or rider meets the terms and conditions
for guaranteed living benefits established by the commissioner and
set forth in the bulletin described in paragraph (3) and the insurer
desiring to issue the variable contract or rider has satisfied the
requirements set forth in Section 2529 of Title 10 of the California
Code of Regulations.
   (c) The bulletin described in paragraph (3) of subdivision (b) may
include provisions covering requirements similar to those included
in subdivision (f) of Section 10506.4.  The bulletin shall have the
same force and effect, and may be enforced by the commissioner to the
same extent and degree as regulations issued by the commissioner
until the time that the commissioner issues additional or amended
regulations pertaining to guaranteed living benefits.
   (d) An insurer may not deliver or issue for delivery variable
contracts containing, or riders to variable contracts providing,
guaranteed living benefits except pursuant to this section.  No
policy, contract, rider, or agreement that constitutes investment
return assurance pursuant to Section 10203.10 or 10507, or guarantee
pursuant to Section 10506.4, may be issued pursuant to this section.

  SEC. 150.  Section 11621.2 of the Insurance Code is amended to
read:
   11621.2.  (a) An insurer that is no longer licensed to write
automobile liability insurance in this state shall have its plan
business treated in the same manner as its voluntary business and
shall not receive new assignments.
   (b) The runoff of existing plan business shall be conducted in an
orderly manner with policies nonrenewed upon the next anniversary
date.
   (c) An insurer that elects to surrender its license or has its
license to do business in this state revoked shall comply with the
following requirements:
   (1) If an insurer elects to leave this state by surrendering its
license to write automobile insurance, it shall submit to the plan's
advisory committee as a condition precedent to the surrender of its
license, a plan that disposes of the insurer's quota of plan
assignments established by its voluntary writings, and provides for
the handling of its outstanding assigned risk policies, including
payment of claims, by appropriate financial arrangements or
reinsurance agreements.  The plan's advisory committee shall evaluate
the plan that is submitted and shall advise the commissioner as to
whether or not it recommends acceptance or rejection by the
commissioner of the plan.
   (2) In the event an insurer's license to do business in this state
is revoked by the commissioner, the insurer shall submit to the plan'
s advisory committee a plan that disposes of the insurer's quota of
plan assignments established by its voluntary writings, and provides
for the handling of its outstanding assigned risk policies, including
payment of claims, by appropriate financial arrangements or
reinsurance agreements.  The plan's advisory committee shall evaluate
the plan that is submitted and shall advise the commissioner as to
whether or not it recommends acceptance or rejection by the
commissioner of the plan.
   (d) If all insurers in a group are under the same ownership and
management, or a group elects to be treated as a single insurer and
an insurer in the same group is no longer licensed, that insurer
shall comply with the provisions of this section.
  SEC. 151.  Section 11784 of the Insurance Code is amended to read:

   11784.  In conducting the business and affairs of the fund, the
manager of the fund may do any of the following:
   (a) Enter into contracts of workers' compensation insurance.
   (b) Sell annuities covering compensation benefits.
   (c) Decline to insure any risk in which the minimum requirements
of the industrial accident prevention authorities with regard to
construction, equipment, and operation are not complied with, or
which is beyond the safe carrying of the fund.  Otherwise, he or she
shall not refuse to insure any workers' compensation risk under state
law, tendered with the premium therefor.
   (d) Reinsure any risk or any part thereof.
   (e) Cause to be inspected and audited the payrolls of employers
applying to the fund for insurance.
   (f) Make rules for the settlement of claims against the fund and
determine to whom and through whom the payments of compensation are
to be made.
   (g) Contract with physicians and surgeons, and hospitals, for
medical and surgical treatment and the care and nursing of injured
persons entitled to benefits from the fund.
  SEC. 152.  Section 11786 of the Insurance Code is amended to read:

   11786.  Before entering on the duties of his or her office, the
manager shall qualify by giving an official bond approved by the
board of directors in the sum of fifty thousand dollars ($50,000) and
by taking and subscribing to an official oath.  The approval of the
board shall be by written endorsement on the bond.  The bond shall be
filed in the office of the Secretary of State.
  SEC. 153.  Section 11787 of the Insurance Code is amended to read:

   11787.  The board of directors may delegate to the manager of the
fund, under any rules and regulations and subject to any conditions
as it from time to time prescribes, any power, function, or duty
conferred by law on the board of directors in connection with the
fund or in connection with the administration, management, and
conduct of the business and affairs of the fund.  The manager may
exercise those powers and functions and perform those duties with the
same force and effect as the board of directors, but subject to its
approval.
  SEC. 154.  Section 12698 of the Insurance Code is amended to read:

   12698.  To be eligible to participate in the program, a person
shall meet all of the following requirements:
   (a) Be a resident of the state for at least six continuous months
prior to application.  A person who is a member of a federally
recognized California Indian tribe is a resident of the state for
these purposes.
   (b) (1) Until the first day of the second month following the
effective date of the amendment made to this subdivision in 1994,
have a household income that does not exceed 250 percent of the
official federal poverty level unless the board determines that the
program funds are adequate to serve households above that level.
   (2) Upon the first day of the second month following the effective
date of the amendment made to this subdivision in 1994, have a
household income that is above 200 percent of the official federal
poverty level but does not exceed 250 percent of the official federal
poverty level unless the board determines that the program funds are
adequate to serve households above the 250 percent of the official
federal poverty level.
   (c) Pay an initial subscriber contribution of not more than fifty
dollars ($50), and agree to the payment of the complete subscriber
contribution.  A federally recognized California Indian tribal
government may make the initial and complete subscriber contributions
on behalf of a member of the tribe only if a contribution on behalf
of members of federally recognized California Indian tribes does not
limit or preclude federal financial participation under Title XXI of
the Social Security Act.  If a federally recognized California Indian
tribal government makes a contribution on behalf of a member of the
tribe, the tribal government shall ensure that the subscriber is made
aware of all the health plan options available in the county where
the member resides.
  SEC. 155.  Section 90.5 of the Labor Code is amended to read:
   90.5.  (a) It is the policy of this state to vigorously enforce
minimum labor standards in order to ensure that employees are not
required or permitted to work under substandard unlawful conditions,
and to protect employers who comply with the law from those who
attempt to gain competitive advantage at the expense of their workers
by failing to comply with minimum labor standards.
   (b) In order to ensure that minimum labor standards are adequately
enforced, the Labor Commissioner shall establish and maintain a
field enforcement unit, which shall be administratively and
physically separate from offices of the division that accept and
determine individual employee complaints.  The unit shall have
offices in Los Angeles, San Francisco, San Jose, San Diego,
Sacramento, and any other locations that the Labor Commissioner deems
appropriate.  The unit shall have primary responsibility for
administering and enforcing those statutes and regulations most
effectively enforced through field investigations, including Sections
226, 1021, 1021.5, 1193.5, 1193.6, 1194.5, 1197, 1198, 1771, 1776,
1777.5, 2651, 2673, 2675, and 3700, in accordance with the plan
adopted by the Labor Commissioner pursuant to subdivision (c).
Nothing in this section shall be construed to limit the authority of
this unit in enforcing any statute or regulation in the course of its
investigations.
   (c) The Labor Commissioner shall adopt an enforcement plan for the
field enforcement unit.  The plan shall identify priorities for
investigations to be undertaken by the unit that ensure the available
resources will be concentrated in industries, occupations, and areas
in which employees are relatively low paid and unskilled, and those
in which there has been a history of violations of the statutes cited
in subdivision (b).
   (d) The Labor Commissioner shall annually report to the
Legislature, not later than March 1, concerning the effectiveness of
the field enforcement unit.  The report shall include, but not be
limited to, all of the following:
   (1) The enforcement plan adopted by the Labor Commissioner
pursuant to subdivision (c), and the rationale for the priorities
identified in the plan.
   (2) The number of establishments investigated by the unit, and the
number of types of violations found.
   (3) The amount of wages found to be unlawfully withheld from
workers, and the amount of unpaid wages recovered for workers.
   (4) The amount of penalties and unpaid wages transferred to the
General Fund as a result of the efforts of the unit.
  SEC. 156.  Section 129 of the Labor Code is amended to read:
   129.  (a) To make certain that injured workers, and their
dependents in the event of their death, receive promptly and
accurately the full measure of compensation to which they are
entitled, the administrative director shall audit insurers,
self-insured employers, and third-party administrators to determine
if they have met their obligations under this code.  At least half of
the audit subjects shall be selected at random, and the remaining
subjects shall be selected pursuant to subdivision (b).  The results
of audits of insurers shall be provided to the Insurance
Commissioner, and the results of audits of self-insured employers and
third-party administrators shall be provided to the Director of
Industrial Relations.  Nothing in this section shall restrict the
authority of the Director of Industrial Relations or the Insurance
Commissioner to audit their licensees.
   (b) The administrative director shall establish priorities for
audits based on information obtained from the Benefit Notice program
established under Section 138.4, through information and assistance
services and other factual information that indicates an insurer,
self-insured employer, or third-party administrator is failing to
meet its obligations under this division or Division 4 (commencing
with Section 3200) or the regulations of the administrative director.

   (c) If, as a result of an audit, the administrative director
determines that any compensation, interest, or penalty is due and
unpaid to an employee or dependent, the administrative director shall
issue and cause to be served upon the insurer, self-insured
employer, or third-party administrator a notice of assessment
detailing the amounts due and unpaid in each case, and shall order
the amounts paid to the person entitled thereto.  The notice of
assessment shall be served personally or by registered mail in
accordance with subdivision (c) of Section 11505 of the Government
Code.  A copy of the notice of assessment shall also be sent to the
affected                                              employee or
dependent.
   If the amounts are not paid within 30 days after service of a
notice of assessment, the employer shall also be liable for
reasonable attorney's fees necessarily incurred by the employee or
dependent to obtain amounts due.  The administrative director shall
advise each employee or dependent still owed compensation after this
30-day period of his or her rights with respect to the commencement
of proceedings to collect the compensation owed.  Amounts unpaid
because the person entitled thereto cannot be located shall be paid
to the Workplace Health and Safety Revolving Fund.  The Director of
Industrial Relations shall promulgate rules and regulations
establishing standards and procedures for the payment of compensation
from moneys deposited into the Workplace Health and Safety Revolving
Fund whenever the person entitled thereto applies for compensation.

   (d) A determination by the administrative director that an amount
is or is not due to an employee or dependent shall not in any manner
limit the jurisdiction or authority of the appeals board to determine
the issue.
   (e) Annually, commencing on April 1, 1991, the administrative
director shall publish a report detailing the results of audits
conducted pursuant to this section during the preceding calendar
year.  The report shall include the name of each insurer,
self-insured employer, and third-party administrator audited during
that period.  For each insurer, self-insured employer, and
third-party administrator audited, the report shall specify the total
number of files audited, the number of violations found by type and
amount of compensation, interest and penalties payable, and the
amount collected for each violation.
   These reports shall not identify the particular claim file which
resulted in a particular violation or penalty.  Except as required by
this subdivision or other provisions of law, the contents of
individual claim files and auditor's working papers shall be
confidential.  Disclosure of claim information to the administrative
director pursuant to an audit shall not waive provisions of the
Evidence Code relating to privilege.
  SEC. 157.  Section 230.1 of the Labor Code is amended to read:
   230.1.  (a) In addition to the requirements and prohibitions
imposed on employees pursuant to Section 230, an employer with 25 or
more employees may not discharge or in any manner discriminate or
retaliate against an employee who is a victim of domestic violence as
defined in Section 6211 of the Family Code for taking time off from
work to attend to any of the following:
   (1) To seek medical attention for injuries caused by domestic
violence.
   (2) To obtain services from a domestic violence shelter, program,
or rape crisis center as a result of domestic violence.
   (3) To obtain psychological counseling related to an experience of
domestic violence.
   (4) To participate in safety planning and take other actions to
increase safety from future domestic violence, including temporary or
permanent relocation.
   (b) (1) As a condition of taking time off for a purpose set forth
in subdivision (a), the employee shall give the employer reasonable
advance notice of the employee's intention to take time off, unless
the advance notice is not feasible.
   (2) When an unscheduled absence occurs, the employer shall not
take any action against the employee if the employee, within a
reasonable time after the absence, provides a certification to the
employer.  Certification shall be sufficient in the form of any of
the following:
   (A) A police report indicating that the employee was a victim of
domestic violence.
   (B) A court order protecting or separating the employee from the
perpetrator of an act of domestic violence, or other evidence from
the court or prosecuting attorney that the employee appeared in
court.
   (C) Documentation from a medical professional, domestic violence
advocate, health care provider, or counselor that the employee was
undergoing treatment for physical or mental injuries or abuse
resulting in victimization from an act of domestic violence.
   (3) To the extent allowed by law, employers shall maintain the
confidentiality of any employee requesting leave under subdivision
(a).
   (c) Any employee who is discharged, threatened with discharge,
demoted, suspended, or in any other manner discriminated or
retaliated against in the terms and conditions of employment by his
or her employer because the employee has taken time off for a purpose
set forth in subdivision (a) shall be entitled to reinstatement and
reimbursement for lost wages and work benefits caused by the acts of
the  employer.  Any employer who willfully refuses to rehire,
promote, or otherwise restore an employee or former employee who has
been determined to be eligible for rehiring or promotion by a
grievance procedure or hearing authorized by law is guilty of a
misdemeanor.
   (d) (1) Any employee who is discharged, threatened with discharge,
demoted, suspended, or in any other manner discriminated or
retaliated against in the terms and conditions of employment by his
or her employer because the employee has exercised his or her rights
as set forth in subdivision (a) may file a complaint with the
Division of Labor Standards Enforcement of the Department of
Industrial Relations pursuant to Section 98.7.
   (2) Notwithstanding any time limitation in Section 98.7, an
employee filing a complaint with the division based upon a violation
of subdivision (a) shall have one year from the date of occurrence of
the violation to file his or her complaint.
   (e) An employee may use vacation, personal leave, or compensatory
time off that is otherwise available to the employee under the
applicable terms of employment, unless otherwise provided by a
collective bargaining agreement, for time taken off for a purpose
specified in subdivision (a).  The entitlement of any employee under
this section shall not be diminished by any collective bargaining
agreement term or condition.
   (f) This section does not create a right for an employee to take
unpaid leave that exceeds the unpaid leave time allowed under, or is
in addition to the unpaid leave time permitted by, the federal Family
and Medical Leave Act of 1993 (29 U.S.C. Sec. 2601 et seq.).
  SEC. 158.  Section 4455 of the Labor Code is amended to read:
   4455.  If the injured employee is under 18 years of age, and his
or her incapacity is permanent, his or her average weekly earnings
shall be deemed, within the limits fixed in Section 4453, to be the
weekly sum that under ordinary circumstances he or she would probably
be able to earn at the age of 18 years, in the occupation in which
he or she was employed at the time of the injury or in any occupation
to which he or she would reasonably have been promoted if he or she
had not been injured.  If these probable earnings at the age of 18
years cannot reasonably be determined, his or her average weekly
earnings shall be taken at one hundred five dollars ($105).
  SEC. 159.  Section 4609 of the Labor Code is amended to read:
   4609.  (a) In order to prevent the improper selling, leasing, or
transferring of a health care provider's contract, it is the intent
of the Legislature that every arrangement that results in any payor
paying a health care provider a reduced rate for health care services
based on the health care provider's participation in a network or
panel shall be disclosed by the contracting agent to the provider in
advance and shall actively encourage employees to use the network,
unless the health care provider agrees to provide discounts without
that active encouragement.
   (b) Beginning July 1, 2000, every contracting agent that sells,
leases, assigns, transfers, or conveys its list of contracted health
care providers and their contracted reimbursement rates to a payor,
as defined in subparagraph (A) of paragraph (3) of subdivision  (d),
or another contracting agent shall, upon entering or renewing a
provider contract, do all of the following:
   (1) Disclose whether the list of contracted providers may be sold,
leased, transferred, or conveyed to other payors or other
contracting agents, and specify whether those payors or contracting
agents include workers' compensation insurers or automobile insurers.

   (2) Disclose what specific practices, if any, payors utilize to
actively encourage employees to use the list of contracted providers
when obtaining medical care that entitles a payor to claim a
contracted rate.  For purposes of this paragraph, a payor is deemed
to have actively encouraged employees to use the list of contracted
providers if the employer provides information directly to employees
during the period the employer has medical control advising them of
the existence of the list of contracted providers through the use of
a variety of advertising or marketing approaches that supply the
names, addresses, and telephone numbers of contracted providers to
employees; or in advance of a workplace injury, or upon notice of an
injury or claim by an employee, the approaches may include, but are
not limited to, the use of provider directories, the use of a list of
all contracted providers in an area geographically accessible to the
posting site, the use of wall cards that direct employees to a
readily accessible listing of those providers at the same location as
the wall cards, the use of wall cards that direct employees to a
toll-free telephone number or Internet Web site address, or the use
of toll-free telephone numbers or Internet Web site addresses
supplied directly during the period the employer has medical control.
  However, Internet Web site addresses alone shall not be deemed to
satisfy the requirements of this paragraph.  Nothing in this
paragraph shall prevent contracting agents or payors from providing
only listings of providers located within a reasonable geographic
range of an employee.  A payor who otherwise meets the requirements
of this paragraph is deemed to have met the requirements of this
paragraph regardless of the employer's ability to control medical
treatment pursuant to Sections 4600 and 4600.3.
   (3) Disclose whether payors to which the list of contracted
providers may be sold, leased, transferred, or conveyed may be
permitted to pay a provider's contracted rate without actively
encouraging the employees to use the list of contracted providers
when obtaining medical care.  Nothing in this subdivision shall be
construed to require a payor to actively encourage the employees to
use the list of contracted providers when obtaining medical care in
the case of an emergency.
   (4) Disclose, upon the initial signing of a contract, and within
15 business days of receipt of a written request from a provider or
provider panel, a payor summary of all payors currently eligible to
claim a provider's contracted rate due to the provider's and payor's
respective written agreements with any contracting agent.
   (5) Allow providers, upon the initial signing, renewal, or
amendment of a provider contract, to decline to be included in any
list of contracted providers that is sold, leased, transferred, or
conveyed to payors that do not actively encourage the employees to
use the list of contracted providers when obtaining medical care as
described in paragraph (2).  Each provider's election under this
paragraph shall be binding on the contracting agent with which the
provider has the contract and any other contracting agent that buys,
leases, or otherwise obtains the list of contracted providers.
   A provider shall not be excluded from any list of contracted
providers that is sold, leased, transferred, or conveyed to payors
that actively encourage the employees to use the list of contracted
providers when obtaining medical care, based upon the provider's
refusal to be included on any list of contracted providers that is
sold, leased, transferred, or conveyed to payors that do not actively
encourage the employees to use the list of contracted providers when
obtaining medical care.
   (6) If the payor's explanation of benefits or explanation of
review does not identify the name of the network that has a written
agreement signed by the provider whereby the payor is entitled,
directly or indirectly, to pay a preferred rate for the services
rendered, the contracting agent shall do the following:
   (A) Maintain a Web site that is accessible to all contracted
providers and updated at least quarterly and maintain a toll-free
telephone number accessible to all contracted providers whereby
providers may access payor summary information.
   (B) Disclose through the use of an Internet Web site, a toll-free
telephone number, or through a delivery or mail service to its
contracted providers, within 30 days, any sale, lease assignment,
transfer or conveyance of the contracted reimbursement rates to
another contracting agent or payor.
   (7) Nothing in this subdivision shall be construed to impose
requirements or regulations upon payors, as defined in subparagraph
(A) of paragraph (3) of subdivision  (d).
   (c) Beginning July 1, 2000, a payor, as defined in subparagraph
(B) of paragraph (3) of subdivision  (d), shall do all of the
following:
   (1) Provide an explanation of benefits or explanation of review
that identifies the name of the network with which the payor has an
agreement that entitles them to pay a preferred rate for the services
rendered.
   (2) Demonstrate that it is entitled to pay a contracted rate
within 30 business days of receipt of a written request from a
provider who has received a claim payment from the payor.  The
provider shall include in the request a statement explaining why the
payment is not at the correct contracted rate for the services
provided.  The failure of the provider to include a statement shall
relieve the payor from the responsibility of demonstrating that it is
entitled to pay the disputed contracted rate.  The failure of a
payor to make the demonstration to a properly documented request of
the provider within 30 business days shall render the payor
responsible for the lesser of the provider's actual fee or, as
applicable, any fee schedule pursuant to this division, which amount
shall be due and payable within 10 days of receipt of written notice
from the provider, and shall bar the payor from taking any future
discounts from that provider without the provider's express written
consent until the payor can demonstrate to the provider that it is
entitled to pay a contracted rate as provided in this subdivision.  A
payor shall be deemed to have demonstrated that it is entitled to
pay a contracted rate if it complies with either of the following:
   (A) Describes the specific practices the payor utilizes to comply
with paragraph (2) of subdivision (b), and demonstrates compliance
with paragraph (1).
   (B) Identifies the contracting agent with whom the payor has a
written agreement whereby the payor is not required to actively
encourage employees to use the list of contracted providers pursuant
to paragraph (5) of subdivision (b).
   (d)  For the purposes of this section, the following terms have
the following meanings:
   (1) "Contracting agent" means an insurer licensed under the
Insurance Code to provide workers' compensation insurance, a health
care service plan, including a specialized health care service plan,
a preferred provider organization, or a self-insured employer, while
engaged, for monetary or other consideration, in the act of selling,
leasing, transferring, assigning, or conveying a provider or provider
panel to provide health care services to employees for work-related
injuries.
   (2) "Employee" means a person entitled to seek health care
services for a work-related injury.
   (3) (A) For the purposes of  subdivision (b), "payor" means a
health care service plan, including a specialized health care service
plan, an insurer licensed under the Insurance Code to provide
disability insurance that covers hospital, medical, or surgical
benefits, automobile insurance, or workers' compensation insurance,
or a self-insured employer that is responsible to pay for health care
services provided to beneficiaries.
   (B) For the purposes of subdivision  (c), "payor" means an insurer
licensed under the Insurance Code to provide workers' compensation
insurance, a self-insured employer, a third-party administrator or
trust, or any other third party that is responsible to pay health
care services provided to employees for work-related injuries, or an
agent of an entity included in this definition.
   (4) "Payor summary" means a written summary that includes the
payor's name and the type of plan, including, but not limited to, a
group health plan, an automobile insurance plan, and a workers'
compensation insurance plan.
   (5) "Provider" means any of the following:
   (A) Any person licensed or certified pursuant to Division 2
(commencing with Section 500) of the Business and Professions Code.
   (B) Any person licensed pursuant to the Chiropractic Initiative
Act or the Osteopathic Initiative Act.
   (C) Any person licensed pursuant to Chapter 2.5 (commencing with
Section 1440) of Division 2 of the Health and Safety Code.
   (D) A clinic, health dispensary, or health facility licensed
pursuant to Division 2 (commencing with Section 1200) of the Health
and Safety Code.
   (E) Any entity exempt from licensure pursuant to Section 1206 of
the Health and Safety Code.
   (e)  This section shall become operative on July 1, 2000.
  SEC. 160.  Section 1048 of the Military and Veterans Code is
amended to read:
   1048.  (a) The Morale, Welfare, and Recreation Fund shall include
proceeds from operations of the Veterans' Home Exchange, revenue
derived from the issuance of prisoner-of-war special license plates
pursuant to Section 5101.5 of the Vehicle Code, all funds derived
from golf course green fees and range ball fees, all donations to the
fund, interest earned on invested funds, funds derived from the
estates of deceased members, and any other moneys or property
described in this chapter, including, but not limited to, moneys and
properties received by the home from estate assets located outside
the home, regardless of amount.
   (b) The administrator shall prepare an itemized report that is
organized by category and accounts for all funds deposited into the
Morale, Welfare, and Recreation Fund and transmitted to the
Controller under Section 1047 during the previous fiscal year and
shall submit the report on or before August 20 of each year to all of
the following:
   (1) The secretary.
   (2) The fiscal committees of the Assembly and the Senate.
   (3) The committees of the Assembly and the Senate that have
subject matter jurisdiction over veterans' affairs.
   (4) The Veterans' Home Allied Council.
  SEC. 161.  Section 272 of the Penal Code is amended to read:
   272.  (a) (1) Every person who commits any act or omits the
performance of any duty, which act or omission causes or tends to
cause or encourage any person under the age of 18 years to come
within the provisions of Section 300, 601, or 602 of the Welfare and
Institutions Code or which act or omission contributes thereto, or
any person who, by any act or omission, or by threats, commands, or
persuasion, induces or endeavors to induce any person under the age
of 18 years or any ward or dependent child of the juvenile court to
fail or refuse to conform to a lawful order of the juvenile court, or
to do or to perform any act or to follow any course of conduct or to
so live as would cause or manifestly tend to cause that person to
become or to remain a person within the provisions of Section 300,
601, or 602 of the Welfare and Institutions Code, is guilty of a
misdemeanor and upon conviction thereof shall be punished by a fine
not exceeding two thousand five hundred dollars ($2,500), or by
imprisonment in the county jail for not more than one year, or by
both fine and imprisonment in a county jail, or may be released on
probation for a period not exceeding five years.
   (2) For purposes of this subdivision, a parent or legal guardian
to any person under the age of 18 years shall have the duty to
exercise reasonable care, supervision, protection, and control over
their minor child.
   (b) (1) An adult stranger who is 21 years of age or older, who
knowingly contacts or communicates with a minor who is 12 years of
age or younger, who knew or reasonably should have known that the
minor is 12 years of age or younger, for the purpose of persuading
and luring, or transporting, or attempting to persuade and lure, or
transport, that minor away from the minor's home or from any location
known by the minor's parent, legal guardian, or custodian, to be a
place where the minor is located, for any purpose, without the
express consent of the minor's parent or legal guardian, and with the
intent to avoid the consent of the minor's parent or legal guardian,
is guilty of an infraction or a misdemeanor.
   (2) This subdivision shall not apply in an emergency situation.
   (3) As used in this subdivision, the following terms are defined
to mean:
   (A) "Emergency situation" means a situation where the minor is
threatened with imminent bodily harm, emotional harm, or
psychological harm.
   (B) "Contact" or "communication" includes, but is not limited to,
the use of a telephone or the Internet, as defined in Section 17538
of the Business and Professions Code.
   (C) "Stranger" means a person of casual acquaintance with whom no
substantial relationship exists, or an individual with whom a
relationship has been established or promoted for the primary purpose
of victimization, as defined in subdivision (e) of Section 6600 of
the Welfare and Institutions Code.
   (D) "Express consent" means oral or written permission that is
positive, direct, and unequivocal, requiring no inference or
implication to supply its meaning.
   (4) This section shall not be interpreted to criminalize acts of
persons contacting minors within the scope and course of their
employment, or status as a volunteer of a recognized civic or
charitable organization.
   (5) This section is intended to protect minors and to help parents
and legal guardians exercise reasonable care, supervision,
protection, and control over minor children.
  SEC. 162.  Section 417.2 of the Penal Code is amended to read:
   417.2.  (a) Any person who, for commercial purposes, purchases,
sells, manufactures, ships, transports, distributes, or receives, by
mail order or in any other manner, an imitation firearm except as
permitted by this section shall be liable for a civil fine in an
action brought by the city attorney of the city or the district
attorney of the county of not more than ten thousand dollars
($10,000) for each violation.
   (b) The manufacture, purchase, sale, shipping, transport,
distribution, or receipt, by mail or in any other manner, of
imitation firearms is permitted if the device is manufactured,
purchased, sold, shipped, transported, distributed, or received for
any of the following purposes:
   (1) Solely for export in interstate or foreign commerce.
   (2) Solely for lawful use in theatrical productions, including
motion picture, television, and stage productions.
   (3) For use in a certified or regulated athletic event or
competition.
   (4) For use in military or civil defense activities.
   (5) For public displays authorized by public or private schools.
   (c) As used in this section, "imitation firearm" means a replica
of a firearm that is so substantially similar in physical properties
to an existing firearm as to lead a reasonable person to conclude
that the replica is a firearm.
   (d) As used in this section, "imitation firearm" does not include
any of the following:
   (1) A nonfiring collector's replica of an antique firearm that was
designed prior to 1898, is historically significant, and is offered
for sale in conjunction with a wall plaque or presentation case.
   (2) A nonfiring collector's replica of a firearm that was designed
after 1898, is historically significant, was issued as a
commemorative by a nonprofit organization, and is offered for sale in
conjunction with a wall plaque or presentation case.
   (3) A device, as defined in subdivision (g) of Section 12001.
   (4) An imitation firearm where the coloration of the entire
exterior surface of the device is bright orange or bright green,
either singly or in combination.
   (5) An instrument that expels a metallic projectile, such as a BB
or pellet, through the force of air pressure, CO2 pressure, or spring
action, or a spot marker gun.
  SEC. 163.  Section 646.94 of the Penal Code is amended to read:
   646.94.  (a) Contingent upon a Budget Act appropriation, the
Department of Corrections shall ensure that any parolee convicted of
violating Section 646.9 on or after January 1, 2002, who is deemed to
pose a high risk of committing a repeat stalking offense be placed
on an intensive and specialized parole supervision program for a
period not to exceed the period of parole.
   (b) (1) The program shall include referral to specialized
services, for example substance abuse treatment, for offenders
needing those specialized services.
   (2) Parolees participating in this program shall be required to
participate in relapse prevention classes as a condition of parole.
   (3) Parole agents may conduct group counseling sessions as part of
the program.
   (4) The department may include other appropriate offenders in the
treatment program if doing so facilitates the effectiveness of the
treatment program.
   (c) The program shall be established with the assistance and
supervision of the staff of the department primarily by obtaining the
services of mental health providers specializing in the treatment of
stalking patients.  Each parolee placed into this program shall be
required to participate in clinical counseling programs aimed at
reducing the likelihood that the parolee will commit or attempt to
commit acts of violence or stalk their victim.
   (d) The department may require persons subject to this section to
pay some or all of the costs associated with this treatment, subject
to the person's ability to pay.  "Ability to pay" means the overall
capability of the person to reimburse the costs, or a portion of the
costs, of providing mental health treatment, and shall include, but
shall not be limited to, consideration of all of the following
factors:
   (1) Present financial position.
   (2) Reasonably discernible future financial position.
   (3) Likelihood that the person shall be able to obtain employment
after the date of parole.
                                                      (4) Any other
factor or factors that may bear upon the person's financial
capability to reimburse the department for the costs.
   (e) For purposes of this section, a mental health provider
specializing in the treatment of stalking patients shall meet all of
the following requirements:
   (1) Be a licensed clinical social worker, as defined in Article 4
(commencing with Section 4996) of Chapter 14 of Division 2 of the
Business and Professions Code, a clinical psychologist, as defined in
Section 1316.5 of the Health and Safety Code, or a physician and
surgeon engaged in the practice of psychiatry.
   (2) Have clinical experience in the area of assessment and
treatment of stalking patients.
   (3) Have two letters of reference from professionals who can
attest to the applicant's experience in counseling stalking patients.

   (f) The program shall target parolees convicted of violating
Section 646.9 who meet the following conditions:
   (1) The offender has been subject to a clinical assessment.
   (2) A review of the offender's criminal history indicates that the
offender poses a high risk of committing further acts of stalking or
acts of violence against his or her victim or other persons upon his
or her release on parole.
   (3) The parolee, based on his or her clinical assessment, may be
amenable to treatment.
   (g) On or before January 1, 2006, the Department of Corrections
shall evaluate the intensive and specialized parole supervision
program and make a report to the Legislature regarding the results of
the program, including, but not limited to, the recidivism rate for
repeat stalking related offenses committed by persons placed into the
program and a cost-benefit analysis of the program.
   (h) This section shall become operative upon the appropriation of
sufficient funds in the Budget Act to implement this section.
  SEC. 164.  Section 3058.65 of the Penal Code is amended to read:
   3058.65.  (a) (1) Whenever any person confined in the state prison
is serving a term for the conviction of child abuse, pursuant to
Section 273a, 273ab, 273d, or any sex offense specified as being
perpetrated against a minor, or as ordered by a court, the Board of
Prison Terms, with respect to inmates sentenced pursuant to
subdivision (b) of Section 1168, or the Department of Corrections,
with respect to inmates sentenced pursuant to Section 1170, shall
notify the immediate family of the parolee who requests that
notification and who provides the department with a current address
that the person is scheduled to be released on parole, or rereleased
following a period of confinement pursuant to a parole revocation
without a new commitment, as specified in subdivision (b).
   (2) For the purposes of this subdivision, "immediate family of the
parolee" means the parents, siblings, and spouse of the parolee.
   (b) (1) The notification shall be made by mail at least 45 days
prior to the scheduled release date, except as provided in paragraph
(2).  The notification shall include the name of the person who is
scheduled to be released, the terms of that person's parole, whether
or not that person is required to register with local law
enforcement, and the community in which that person will reside.  The
notification shall specify the office within the Department of
Corrections that has the authority to make the final determination
and adjustments regarding parole location decisions.
   (2) When notification cannot be provided within the 45 days due to
the unanticipated release date change of an inmate as a result of an
order from the court, an action by the Board of Prison Terms, the
granting of an administrative appeal, or a finding of not guilty or
dismissal of a disciplinary action, that affects the sentence of the
inmate, or due to a modification of the department's decision
regarding the community into which the person is scheduled to be
released pursuant to paragraph (3), the department shall provide
notification to the parties specified in subdivision (a) as soon as
practicable, but in no case less than 24 hours after the final
decision is made regarding the location where the parolee will be
released.
   (c) In no case shall the notice required by this section be later
than the day the person is released on parole.
  SEC. 165.  Section 1813 of the Probate Code is amended to read:
   1813.  (a) The spouse of a proposed conservatee may not petition
for the appointment of a conservator for a spouse or be appointed as
conservator of the person or estate of the proposed conservatee
unless the petitioner alleges in the petition for appointment as
conservator, and the court finds, that the spouse is not a party to
any action or proceeding against the proposed conservatee for legal
separation of the parties, dissolution of marriage, or adjudication
of nullity of their marriage.  However, if the court finds by clear
and convincing evidence that the appointment of the spouse, who is a
party to an action or proceeding against the proposed conservatee for
legal separation of the parties, dissolution of marriage, or
adjudication of nullity of their marriage, or has obtained a judgment
in any of these proceedings, is in the best interests of the
proposed conservatee, the court may appoint the spouse.
   Prior to making this appointment, the court shall appoint counsel
to consult with and advise the conservatee, and to report to the
court his or her findings concerning the suitability of appointing
the spouse as conservator.
   (b) The spouse of a conservatee shall disclose to the conservator,
or if the spouse is the conservator, shall disclose to the court,
the filing of any action or proceeding against the conservatee for
legal separation of the parties, dissolution of marriage, or
adjudication of nullity of the marriage, within 10 days of the filing
of the action or proceeding by filing a notice with the court and
serving the notice according to the notice procedures under this
title.  The court may, upon receipt of the notice, set the matter for
hearing on an order to show cause why the appointment of the spouse
as conservator, if the spouse is the conservator, should not be
terminated and a new conservator appointed by the court.
  SEC. 165.5.  Section 16062 of the Probate Code is amended to read:

   16062.  (a) Except as otherwise provided in this section and in
Section 16064, the trustee shall account at least annually, at the
termination of the trust, and upon a change of  trustee, to each
beneficiary to whom income or principal is required or authorized in
the trustee's discretion to be currently distributed.
   (b) A trustee of a living trust created by an instrument executed
before July 1, 1987, is not subject to the duty to account provided
by subdivision (a).
   (c) A trustee of a trust created by a will executed before July 1,
1987, is not subject to the duty to account provided by subdivision
(a), except that if the trust is removed from continuing court
jurisdiction pursuant to Article 2 (commencing with Section 17350) of
Chapter 4 of Part 5, the duty to account provided by subdivision (a)
applies to the trustee.
   (d) Except as provided in Section 16064, the duty of a trustee to
account pursuant to former Section 1120.1a of the Probate Code (as
repealed by Chapter 820 of the Statutes of 1986), under a trust
created by a will executed before July 1, 1977, which has been
removed from continuing court jurisdiction pursuant to former Section
1120.1a, continues to apply after July 1, 1987.  The duty to account
under former Section 1120.1a may be satisfied by furnishing an
account that satisfies the requirements of Section 16063.
   (e) Any limitation or waiver in a trust instrument of the
obligation to account is against public policy and shall be void as
to any sole trustee who is a disqualified person as defined in
Section 21350.5.
  SEC. 166.  Section 10129 of the Public Contract Code is amended to
read:
   10129.  (a) Notwithstanding Section 3400, an agency of the state
charged with the letting of contracts for the construction,
alteration, or repair of public works may not draft or cause to be
drafted specifications for bids in connection with the construction,
alteration, or repair of public works (1) in a manner as to limit the
bidding, directly or indirectly, to any one specific concern, or (2)
calling for a designated material, product, thing, or service by
specific brand or trade name unless the specification lists at least
two brands or trade names of comparable quality or utility and is
followed by the words "or equal" so that bidders may furnish any
equal material, product, thing, or service.  In applying this
section, the awarding authority shall, if aware of an equal product
manufactured in this state, name that product in the specification.
In those cases involving a unique or novel product application
required to be used in the public interest, or where only one brand
or trade name is known to the awarding authority, it may list only
one.  Specifications shall provide a period of time prior to or after
the award of the contract for submission of data substantiating a
request for a substitution of "an equal" item.  If no time period is
specified, data may be submitted any time within 35 days after the
award of the contract.
   (b) Subdivision (a) is not applicable if the awarding authority
makes a finding that is described in the specifications that a
particular material, product, thing, or service is designated by
specific brand or trade name for either of the following purposes:
   (1) In order that a field test or experiment may be made to
determine the product's suitability for future use.
   (2) In order to match other products in use on a particular public
improvement either completed or in the course of completion.
  SEC. 167.  Section 20209.7 of the Public Contract Code is amended
to read:
   20209.7.  Design-build projects shall progress in a three-step
process, as follows:
   (a) The transit operator shall prepare a set of documents setting
forth the scope of the project.  The documents may include, but are
not limited to, the size, type, and desired design character of the
buildings, transit facilities, and site, performance specifications
covering the quality of materials, equipment, and workmanship,
preliminary plans or building layouts, or any other information
deemed necessary to describe adequately the transit operator's needs.
  The performance specifications and any plans shall be prepared by a
design professional duly licensed or registered in California.
   (b) Any architectural or engineering firm or individual retained
by the transit operator to assist in the development criteria or
preparation of the request for proposal shall not be eligible to
participate in the competition with the design-build entity.
   (c) The transit operator shall establish and enforce a labor
compliance program containing the requirements outlined in Section
1771.5 of the Labor Code or shall contract with a third party to
operate a labor compliance program containing the requirements
outlined in Section 1771.5 of the Labor Code.  This requirement shall
not apply to projects where the transit operator or the design-build
entity has entered into a collective bargaining agreement that binds
all of the contractors performing work on the project.
   (d) (1) Each RFP shall identify the basic scope and needs of the
project or contract, the expected cost range, and other information
deemed necessary by the contracting agency to inform interested
parties of the contracting opportunity.
   (2) Each RFP shall invite interested parties to submit competitive
sealed proposals in the manner prescribed by the contracting agency.

   (3) Each RFP shall include a section identifying and describing:
   (A) All significant factors that the agency reasonably expects to
consider in evaluating proposals, including cost or price and all
nonprice related factors.
   (B) The methodology and rating or weighting scheme that will be
used by the agency in evaluating competitive proposals and
specifically whether proposals will be rated according to numeric or
qualitative values.
   (C) The relative importance or weight assigned to each of the
factors identified in the RFP.  If a nonweighted system is used, the
agency shall specifically disclose whether all evaluation factors
other than cost or price, when combined, are any of the following:
   (i) Significantly more important than cost or price.
   (ii) Approximately equal in importance to cost or price.
   (iii) Significantly less important than cost or price.
   (D) If the contracting agency wishes to reserve the right to hold
discussions or negotiations with offerors, it shall specify the same
in the RFP and shall publish separately or incorporate into the RFP
applicable rules and procedures to be observed by the agency to
ensure that any discussions or negotiations are conducted in a fair
and impartial manner.
   (e) (1) The transit operator shall establish a procedure to
prequalify design-build entities using a standard questionnaire
developed by the Director of Industrial Relations.  The standardized
questionnaire may not require prospective bidders to disclose any
violations of Chapter 1 (commencing with Section 1720) of Part 7 of
Division 2 of the Labor Code committed prior to January 1, 1998, if
the violation was based on a subcontractor's failure to comply with
these provisions and the bidder had no knowledge of the subcontractor'
s violations and the bidder complied with the conditions set forth in
subdivision (b) of Section 1775 of the Labor Code.  In preparing the
questionnaire, the director shall consult with the construction
industry, transit operators, and other affected parties.  This
questionnaire shall require information including, but not limited
to, all of the following:
   (A) A listing of all the contractors that are part of the
design-build entity.
   (B) Evidence that the members of the design-build entity have
completed, or demonstrated the experience, competency, capability,
and capacity to complete, projects of similar size, scope, or
complexity, and that proposed key personnel have sufficient
experience and training to competently manage and complete the design
and construction of the project.
   (C) The licenses, registrations, and credentials required to
design and construct the project, including information on the
revocation or suspension of any license, credential, or registration.

   (D) Evidence that establishes that the design-build entity has the
capacity to obtain all required payment and performance bonding,
liability insurance, and errors and omissions insurance, as well as a
financial statement that assures the transit operator that the
design-build entity has the capacity to complete the project.
   (E) Any prior serious or willful violation of the California
Occupational Safety and Health Act of 1973, contained in Part 1
(commencing with Section 6300) of Division 5 of the Labor Code or the
Federal Occupational Safety and Health Act of 1970 (P.L. 91-596),
settled against any member of the design-build entity, and
information concerning a contractor member's workers' compensation
experience history and worker safety program.
   (F) Information concerning any debarment, disqualification, or
removal from a federal, state, or local government public works
project.  Any instance where an entity, its owners, officers, or
managing employees submitted a bid on a public works project and were
found by an awarding body not to be a responsible bidder.
   (G) Any instance where the entity, its owner, officers, or
managing employees defaulted on a construction contract.
   (H) Any violations of the Contractors' State License Law (Chapter
9 (commencing with Section 7000) of Division 3 of the Business and
Professions Code), excluding alleged violations of federal or state
law, including the payment of wages, benefits, apprenticeship
requirements, or personal income tax withholding, or of Federal
Insurance Contribution Act (FICA) withholding requirements settled
against any member of the design-build entity.
   (I) Information concerning the bankruptcy or receivership of any
member of the entity, and information concerning all legal claims,
disputes, or lawsuits arising from any construction project of any
member of the entity during the past three years, including
information concerning any work completed by a surety.
   (J) If the design-build entity is a partnership, limited
partnership, or other association, a listing of all of the partners,
general partners, or association members who will participate as
subcontractors in the design-build contract.
   (K) Evidence that the members of the design-build entity have
completed, or demonstrated the experience, competency, capability,
and capacity to complete, projects of similar size, scope, or
complexity, and that proposed key personnel have sufficient
experience and training to competently manage and complete the design
and construction of the project.
   (L) Information concerning all settled adverse claims, disputes,
or lawsuits between the owner of a public works project and any
member of the design-build entity during the five-year period
immediately preceding submission of a bid pursuant to this section,
in which the claim, settlement, or judgment exceeds fifty thousand
dollars ($50,000).  Information shall also be provided concerning any
work completed by a surety during this period.
   (M) In the case of a partnership or other association that is not
a legal entity, a copy of the agreement creating the partnership or
association and specifying that all partners or association members
agree to be liable for full performance under the design-build
contract.
   (2) The information required pursuant to this subdivision shall be
verified under oath by the entity and its members in the manner in
which civil pleadings in civil actions are verified.  Information
that is not a public record pursuant to the California Public Records
Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of
Title 1 of the Government Code) shall not be open to public
inspection.
   (f) The transit operator shall establish a procedure for final
selection of the design-build entity.  Selection shall be based on
either of the two following procedures, except that in no case may
the transit operator award a contract to a design-build entity
pursuant to this article for a rail project unless that project
exceeds fifty million dollars ($50,000,000) in cost:
   (1) For projects with costs from ten million dollars ($10,000,000)
to twenty million dollars ($20,000,000), inclusive, the contract
shall be awarded to the lowest responsible bidder.
   (2) For projects costing over twenty million dollars
($20,000,000), the transit operator may award the projects using
either the lowest responsible bidder or by best value.
  SEC. 168.  Section 5090.51 of the Public Resources Code is amended
to read:
   5090.51.  (a) Except as provided in subdivision (b), to be
eligible for a grant, the applicant shall agree to provide, and
provide, matching funds, or the equivalent value of services,
material, or property used, in an amount of not less than 25 percent
of the total expense of the off-highway motor vehicle facility.
   (b) Notwithstanding subdivision (a), there shall be no matching
fund requirement imposed with respect to any grant, or portion of any
grant, that consists of funding for the planning, acquisition,
development, or construction of a regional off-highway motor vehicle
facility.  The commission shall adopt criteria for the determination
of which facilities are regional and which are less than regional.
The criteria shall take into account, at a minimum, all of the
following:
   (1) That the facility for which a grant is requested is or will be
primarily for casual usage.
   (2) The size of each facility.
   (3) The diversity of vehicle-related recreational activities to be
provided by the facility.
   (4) The size of the population of potential users of the facility
and the extent of the geographic area to be served by the facility.
   (5) The potential for each facility for which a grant is requested
to become financially self-sustaining.
  SEC. 169.  Section 14581 of the Public Resources Code is amended to
read:
   14581.  (a) Subject to the availability of funds, and pursuant to
subdivision (c), the department shall expend the money set aside in
the fund, pursuant to subdivision (c) of Section 14580 for the
purposes of this section:
   (1) Twenty-three million five hundred thousand dollars
($23,500,000) shall be expended annually for the payment of handling
fees required pursuant to Section 14585.
   (2) Fifteen million dollars ($15,000,000) shall be expended
annually for payments for curbside programs and neighborhood dropoff
programs pursuant to Section 14549.6.
   (3) (A) Fifteen million dollars ($15,000,000), plus the
proportional share of the cost-of-living adjustment, as provided in
subdivision (b), shall be expended annually in the form of grants for
beverage container litter reduction programs and recycling programs
issued to either of the following:
   (i) Certified community conservation corps that were in existence
on September 30, 1999, or that are formed subsequent to that date,
that are designated by a city or a city and county to perform litter
abatement, recycling, and related activities, if the city or the city
and county has a population, as determined by the most recent
census, of more than 250,000 persons.
   (ii) Community conservation corps that are designated by a county
to perform litter abatement, recycling, and related activities, and
are certified by the California Conservation Corps as having operated
for a minimum of two years and as meeting all other criteria of
Section 14507.5.
   (B) Any grants provided pursuant to this paragraph shall not
comprise more than 75 percent of the annual budget of a community
conservation corps.
   (4) (A) Ten million five hundred thousand dollars ($10,500,000)
may be expended annually for payments of five thousand dollars
($5,000) to cities and ten thousand dollars ($10,000) for payments to
counties for beverage container recycling and litter cleanup
activities, or the department may calculate the payments to counties
and cities on a per capita basis, and may pay whichever amount is
greater, for those activities.
   (B) Eligible activities for the use of these funds may include,
but are not necessarily limited to, support for new or existing
curbside recycling programs, neighborhood dropoff recycling programs,
public education promoting beverage container recycling, litter
prevention, and cleanup, cooperative regional efforts among two or
more cities or counties, or both, or other beverage container
recycling programs.
   (C) These funds may not be used for activities unrelated to
beverage container recycling or litter reduction.
   (D) To receive these funds, a city, county, or city and county
shall fill out and return a funding request form to the Department of
Conservation.  The form shall specify the beverage container
recycling or litter reduction activities for which the funds will be
used.
   (E) The Department of Conservation shall annually prepare and
distribute a funding request form to each city, county, or city and
county.  The form shall specify the amount of beverage container
recycling and litter cleanup funds for which the jurisdiction is
eligible.  The form shall not exceed one double-sided page in length,
and may be submitted electronically.  If a city, county, or city and
county does not return the funding request form within 90 days of
receipt of the form from the department, the city, county, or city
and county is not eligible to receive the funds for that funding
cycle.
   (F) For the purposes of this paragraph, per capita population
shall be based on the population of the incorporated area of a city
or city and county and the unincorporated area of a county.  The
department may withhold payment to any city, county, or city and
county that has prohibited the siting of a supermarket site, caused a
supermarket site to close its business, or adopted a land use policy
that restricts or prohibits the siting of a supermarket site within
its jurisdiction.
   (5) (A) Five hundred thousand dollars ($500,000) may be expended
annually in the form of grants for beverage container recycling and
litter reduction programs.
   (B) Up to a total of six million eight hundred forty thousand
dollars ($6,840,000) shall be paid to the City of San Diego, between
January 1, 2000, and January 1, 2004, for a curbside recycling
program conducted pursuant to Section 14549.7.
   (6) (A) The department shall expend the amount necessary to pay
the processing payment established pursuant to subdivision (b) of
Section 14575.  The department shall establish separate processing
fee accounts in the fund for each beverage container material type
for which a processing payment and processing fee is calculated
pursuant to Section 14575, into which account shall be deposited both
of the following:
   (i) All amounts paid as processing fees for each beverage
container material type pursuant to subdivision (g) of Section 14575.

   (ii) Funds equal to pay 75 percent of the processing payments
established in subdivision (b) of Section 14575, in order to reduce
the processing fee to the level provided in subdivision (f) of
Section 14575.
   (B) Notwithstanding Section 13340 of the Government Code, the
money in each processing fee account is hereby continuously
appropriated to the department for expenditure without regard to
fiscal years, for purposes of making processing payments, and
reducing processing fees, pursuant to Section 14575.
   (7) (A) Up to ten million dollars ($10,000,000) shall be expended
by the department between January 1, 2000, and January 1, 2002, for
the purposes of undertaking a statewide public education and
information campaign aimed at promoting increased recycling of
beverage containers.
   (B) On or before July 1, 2002, the department shall provide a
report to the Legislature on the impact of the statewide public
education and information campaign and make recommendations for any
future campaigns.
   (8) Up to three million dollars ($3,000,000) shall be expended
annually for the payment of quality glass incentive payments pursuant
to Section 14549.1.
   (9) (A) Three hundred thousand dollars ($300,000) shall be
expended annually by the department, until January 1, 2003, pursuant
to a cooperative agreement entered into between the department and
Keep California Beautiful, a nonprofit 501(c)(3) organization
chartered by the State                                          of
California in 1990, for the purpose of conducting statewide public
education campaigns aimed at preventing and cleaning up beverage
containers and related litter.  The campaigns shall include, but not
be limited to, coordination of Keep California Beautiful month.
   (B) Prior to making an expenditure pursuant to this paragraph, the
department shall enter into a cooperative agreement with Keep
California Beautiful.
   (C) As part of the cooperative agreement, Keep California
Beautiful shall provide the department with an annual campaign plan
and budget, and a report of previous year campaign activities.
   (D) On or before July 1, 2002, the department shall make a
recommendation to the Legislature on future funding for beverage
container litter prevention and cleanup activities by Keep California
Beautiful.
   (b) The fifteen million dollars ($15,000,000) that is set aside
pursuant to paragraph (3) of subdivision (a) is a base amount that
the department shall adjust annually to reflect any increases or
decreases in the cost of living, as measured by the Department of
Labor, or a successor agency, of the federal government.
   (c) (1) The department shall review all funds on a quarterly basis
to ensure that there are adequate funds to make the payments
specified in this section and the processing fee reductions required
pursuant to Section 14575.
   (2) If the department determines, pursuant to a review made
pursuant to paragraph (1), that there may be inadequate funds to pay
the payments required by this section and the processing fee
reductions required pursuant to Section 14575, the department shall
immediately notify the appropriate policy and fiscal committees of
the Legislature regarding the inadequacy.
   (3) On or before 180 days after the notice is sent pursuant to
paragraph (2), the department may reduce or eliminate expenditures,
or both, from the funds as necessary, according to the procedure set
forth in subdivision (d).
   (d) If the department determines that there are insufficient funds
to make the payments specified pursuant to this section and Section
14575, the department shall reduce all payments proportionally.
   (e) Prior to making an expenditure pursuant to paragraph (7) of
subdivision (a), the department shall convene an advisory committee
consisting of representatives of the beverage industry, beverage
container manufacturers, environmental organizations, the recycling
industry, nonprofit organizations, and retailers, to advise the
department on the most cost-effective and efficient method of the
expenditure of the funds for that education and information campaign.

  SEC. 170.  Section 36710 of the Public Resources Code is amended to
read:
   36710.  The following classifications may not be inconsistent with
United States military activities deemed mission critical by the
United States military:
   (a) In a state marine (estuarine) reserve, it is unlawful to
injure, damage, take, or possess any living geological, or cultural
marine resource, except under a permit or specific authorization from
the managing agency for research, restoration, or monitoring
purposes.  While, to the extent feasible, the area shall be open to
the public for managed enjoyment and study, the area shall be
maintained to the extent practicable in an undisturbed and unpolluted
state.  Access and use for activities such as walking, swimming,
boating, and diving may be restricted to protect marine resources.
Research, restoration, and monitoring may be permitted by the
managing agency.  Educational activities and other forms of
nonconsumptive human use may be permitted by the designating entity
or managing agency in a manner consistent with the protection of all
marine resources.
   (b) In a state marine (estuarine) park, it is unlawful to injure,
damage, take, or possess any living or nonliving marine resource for
commercial exploitation purposes.  Any human use that would
compromise protection of the species of interest, natural community
or habitat, or geological, cultural, or recreational features, may be
restricted by the designating entity or managing agency.  All other
uses are allowed, including scientific collection with a permit,
research, monitoring, and public recreation, including recreational
harvest, unless otherwise restricted.  Public use, enjoyment, and
education are encouraged, in a manner consistent with protecting
resource values.
   (c) In a state marine (estuarine) conservation area, it is
unlawful to injure, damage, take, or possess any living, geological,
or cultural marine resource for commercial or recreational purposes,
or a combination of commercial and recreational purposes, that the
designating entity or managing agency determines would compromise
protection of the species of interest, natural community, habitat, or
geological features.  The designating entity or managing agency may
permit research, education, and recreational activities, and certain
commercial and recreational harvest of marine resources.
   (d) In a state marine (estuarine) cultural preservation area, it
is unlawful to damage, take, or possess any cultural marine resource.
  Complete integrity of the cultural resources shall be sought, and
no structure or improvements that conflict with that integrity shall
be permitted.  No other use is restricted.
   (e) In a state marine (estuarine) recreational management area, it
is unlawful to perform any activity that, as determined by the
designating entity or managing agency, would compromise the
recreational values for which the area may be designated.
Recreational opportunities may be protected, enhanced, or restricted,
while preserving basic resource  values of the area.  No other use
is restricted.
   (f) In a state water quality protection area, point source waste
and thermal discharges shall be prohibited or limited by special
conditions.  Nonpoint source pollution shall be controlled to the
extent practicable.  No other use is restricted.
  SEC. 171.  Section 42923 of the Public Resources Code is amended to
read:
   42923.  (a) The board may grant one or more single or multiyear
time extensions from the requirements of subdivision (a) of Section
42921 to any state agency or large state facility if all of the
following conditions are met:
   (1) Any multiyear extension that is granted does not exceed three
years, and a state agency or a large state facility is not granted
extensions that exceed a total of five years.
   (2) An extension is not granted for any period after January 1,
2006, and an extension is not effective after January 1, 2006.
   (3) The board considers the extent to which a state agency or a
large state facility complied with its plan of correction before
considering another extension.
   (4) The board adopts written findings, based upon substantial
evidence in the record, as follows:
   (A) The state agency or the large state facility is making a good
faith effort to implement the source reduction, recycling, and
composting programs identified in its integrated waste management
plan.
   (B) The state agency or the large state facility submits a plan of
correction that demonstrates that the state agency or the large
state facility will meet the requirements of Section 42921 before the
time extension expires, including the source reduction, recycling,
or composting steps the state agency or the large state facility will
implement, a date prior to the expiration of the time extension when
the requirements of Section 42921 will be met, existing programs
that it will modify, any new programs that will be implemented to
meet those requirements, and the means by which these programs will
be funded.
   (b) (1) When considering a request for an extension, the board may
make specific recommendations for the implementation of the
alternative plans.
   (2) Nothing in this section shall preclude the board from
disapproving any request for an extension.
   (3) If the board disapproves a request for an extension, the board
shall specify its reasons for the disapproval.
   (c) (1) In determining whether to grant the request by a state
agency or a large state facility for the time extension authorized by
subdivision (a), the board shall consider information provided by
the state agency or the large state facility that describes relevant
circumstances that contributed to the request for extension, such as
a lack of markets for recycled materials, local efforts to implement
source reduction, recycling, and composting programs, facilities
built or planned, waste disposal patterns, and the type of waste
disposed by the agency or facility.
   (2) The state agency or the large state facility may provide the
board with any additional information that the state agency or the
large state facility determines to be necessary to demonstrate to the
board the need for the extension.
   (d) If the board grants a time extension pursuant to subdivision
(a), the state agency may request technical assistance from the board
to assist it in meeting the diversion requirements of subdivision
(a) of Section 42921 during the extension period.  If requested by
the state agency or the large state facility, the board shall assist
the state agency or the large state facility with identifying model
policies and plans implemented by other agencies.
   (e) This section shall remain in effect only until January 1,
2006, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2006, deletes or extends
that date.
  SEC. 172.  Section 383.5 of the Public Utilities Code is amended to
read:
   383.5.  (a) As used in this section, the following terms have the
following meaning:
   (1) "In-state renewable electricity generation technology" means
biomass, solar thermal, photovoltaic, wind, geothermal, small
hydropower of 30 megawatts or less, waste tire, digester gas,
landfill gas, and municipal solid waste generation technologies, as
described in the report, defined in paragraph (2), including any
additions or enhancements thereto, that are produced in facilities
located in this state and placed in operation after September 26,
1996, or that were operational prior to that date, and that are also
certified under Section 292.2904 of Title 18 of the Code of Federal
Regulations as a qualifying small power production facility either
located in California, or that began selling electricity to a
California electrical corporation prior to September 26, 1996, under
a Standard Offer Power Purchase Agreement authorized by the
commission.
   (2) "Report" means the Policy Report on AB 1890 Renewables Funding
(March 1997, Publication Number P500-97-002) submitted to the
Legislature by the State Energy Resources Conservation and
Development Commission.
   (b) (1) Forty-five percent of the money collected pursuant to
paragraph (3) of subdivision (c) of Section 381, up to two hundred
forty-three million dollars ($243,000,000), shall be used for
programs that are designed to improve the competitiveness of existing
in-state renewable electricity generation technology facilities, and
to secure for the state the environmental, economic, and reliability
benefits that continued operation of those facilities will provide.

   (2) Any funds used to support in-state renewable electricity
generation technology facilities pursuant to this subdivision shall
be expended in accordance with the provisions of the report, subject
to all of the following requirements:
   (A) Funding for existing renewable electricity generation
technologies shall be grouped into three technology tiers, as
follows:
   (i) Twenty-five percent of the money, up to one hundred
thirty-five million dollars ($135,000,000), shall be used to fund
first tier technologies, including biomass, solar thermal, and whole
waste tire technologies.
   (ii) Thirteen percent of the money, up to seventy million two
hundred thousand dollars ($70,200,000), shall be used to fund second
tier wind technologies.
   (iii) Seven percent of the money, up to thirty-seven million eight
hundred thousand dollars ($37,800,000), shall be used to fund third
tier technologies, including geothermal, small hydropower, digester
gas, landfill gas, and municipal solid waste technologies.
   (B) The State Energy Resources Conservation and Development
Commission shall establish a cents per kilowatthour production
incentive, not to exceed the payment caps per kilowatthour
established in the report representing the difference between target
prices and the market clearing price for electricity, if sufficient
funds are available.  If there are insufficient funds in any payment
period to pay either the difference between the target and market
price or the payment caps, production incentives shall be based on
the amount determined by dividing available funds by eligible
generation.  The target price for Tier 1 technologies shall not be
based on less than four cents ($0.04) per kilowatthour.  The market
clearing price for electricity shall be the energy prices paid to
nonutility power generators as provided in Section 390.
   (C) Funding for each type of existing in-state renewable
electricity generation technology shall be reduced each year during
the period from January 1, 1998, to January 1, 2002, to encourage the
development of increasingly competitive technologies.
   (D) Facilities that are eligible to receive funding pursuant to
this section shall be certified in accordance with the requirements
set forth in the report and may not receive payments for any
electricity produced that has any of the following characteristics:
   (i) Is sold under a fixed energy price payment under a long-term
contract with an existing in-state electrical corporation.
   (ii) Derives from a utility-owned facility that is receiving, or
is eligible to receive, recovery of above-market facility costs
through a competitive transition charge.
   (iii) Is used onsite, sold to customers in a manner that excludes
competitive transition charge payments, or is otherwise excluded from
competitive transition charge payments.
   (c) (1) Thirty percent of the money, up to one hundred sixty-two
million dollars ($162,000,000), collected pursuant to paragraph (3)
of subdivision (c) of Section 381, shall be used for programs
designed to foster the development of new in-state renewable
electricity generation technology facilities, and to secure for the
state the environmental, economic, and reliability benefits that
continued operation of those facilities will provide.  Funds to
further the purposes of this subdivision may be committed for
multiple years.
   (2) Any funds used for new in-state renewable electricity
generation technology facilities pursuant to this subdivision shall
be expended in accordance with the report, subject to all of the
following requirements:
   (A) Funds shall be allocated for proposed projects based on a
competitive solicitation process whereby production incentives, not
to exceed one and one-half cents ($0.015) per kilowatthour, are
awarded to the lowest bidders, provided that not more than 25 percent
of the funds allocated pursuant to paragraph (1) may be awarded to a
single project.
   (B) Funds expended for production incentives shall be paid over a
five-year period commencing on the date that a project begins
electricity production, provided that the project shall be
operational prior to January 1, 2002, unless the State Energy
Resources Conservation and Development Commission finds that the
project will not be operational prior to January 1, 2002, due to
circumstances beyond the control of the developer.  Upon making this
finding, the State Energy Resources Conservation and Development
Commission shall pay production incentives over a five-year period,
commencing on the date of operation, provided that the date that a
project begins electricity production may not extend beyond January
1, 2007.
   (C) The amount of funds expended shall be increased for each
successive year during the period from January 1, 1998, to January 1,
2002, as fewer projects are expected to be funded during the first
few years after funding becomes available.
   (D) Facilities that are eligible to receive payments from the New
Renewable Resources Account created pursuant to paragraph (2) of
subdivision (a) of Section 445 shall be certified as specified in the
report and may not receive payments for any electricity produced
that has any of the following characteristics:
   (i) Is sold under an existing long-term contract with an existing
in-state electrical corporation if the contract includes fixed energy
or capacity payments.
   (ii) Is used onsite and is sold to customers in a manner that
excludes competitive transition charge payments, or is otherwise
excluded from competitive transition charge payments.
   (iii) Is produced by a facility that is owned by customer-owned
electricity generating systems.
   (E) Eligibility to compete for funds or to receive funds shall not
be contingent upon the location or nature of the power purchaser.
   (3) Repowered wind projects shall be eligible for funding under
this subdivision if the new investment is at least 80 percent of the
value of the repowered facility.
   (d) (1) Ten percent of the money collected pursuant to paragraph
(3) of subdivision (c) of Section 381, up to fifty-four million
dollars ($54,000,000), shall be used for a multiyear, consumer-based
program to foster the development of emerging renewable technologies
in distributed generation applications.  Funds to further the
purposes of this subdivision may be committed for multiple years.
   (2) Any funds used for emerging technologies pursuant to this
subdivision shall be expended in accordance with all of the following
requirements:
   (A) Funding for emerging technologies shall be provided through a
competitive, market-based process that shall be in place for a period
of not less than four years, and shall be structured so as to allow
eligible emerging technology manufacturers and suppliers to
anticipate and plan for increased sale and installation volumes over
the life of the program.
   (B) The program shall provide monetary rebates, buydowns, or
equivalent incentives, subject to subparagraph (C) of paragraph (2)
of subdivision (d), to purchasers, lessees, lessors, or sellers of
eligible electricity generating systems.  Incentives shall benefit
the end-use consumer of renewable generation by directly and
exclusively reducing the cost of the eligible system, or the cost of
electricity produced by the eligible system.  Incentives shall be
issued on the basis of the rated electrical capacity of the system
measured in watts.  The amount of the per-watt incentive shall
decline over the term of the program, with a corresponding increase
in the amount of total electrical capacity eligible for the
incentive, thereby encouraging the manufacturers and suppliers of
eligible systems to reduce system costs.  Incentives shall be limited
to a maximum percentage of the system price, as defined by the State
Energy Resources Conservation and Development Commission, and the
maximum incentive percentage shall decline over the term of the
program, as shall the per-watt incentive, in amounts to be determined
by the State Energy Resources Conservation and Development
Commission.
   (C) Eligible distributed emerging technologies are photovoltaic,
solar thermal electric, fuel cell technologies that utilize renewable
fuels, and wind turbines of not more than ten kilowatts rated
electrical capacity per customer site, provided that the technologies
meet the emerging technology eligibility criteria contained in the
report prepared by State Energy Resources Conservation and
Development Commission.  Eligible electricity generating systems are
intended primarily to offset part or all of the consumer's own
electrical energy demand, and shall not be owned by electrical
corporations or publicly owned utilities, be located at a customer
site that is not receiving distribution service from existing
in-state electrical corporations.  Not less than 60 percent of the
available incentive funds shall be reserved for systems of 10
kilowatts rated electrical capacity or smaller, and not less than 15
percent of the funds shall be reserved for systems of 100 kilowatts
rated electrical capacity or smaller.  All eligible electricity
generating system components shall be new and unused, and shall not
have been previously placed in service in any other location or for
any other application.  Systems and their fuel resource shall be
located on the premises of the end-use consumer of the electricity
produced, and all eligible electricity generating systems shall be
connected to the utility grid in California.
   (D) The State Energy Resources Conservation and Development
Commission shall also determine, in collaboration with industry and
consumer interests, if a program provision limiting the amount of
funds available for any single project is warranted, and determine
how federal, state, or other funds or incentives not related to this
section that are already available, or that may become available for
eligible electricity generating systems, may impact the availability
of funds allocated under this section, if at all.  The emerging
renewable technologies program shall be implemented not later than
March 31, 1998, and incentives shall be available for eligible
electricity generating systems that are placed in service after
January 1, 1998, in accordance with the program provisions developed
by the State Energy Resources Conservation and Development
Commission.  However, projects placed in service after January 1,
1998, and prior to September 1, 1998, shall not be subject to limits,
if any, that may be determined by the commission, pursuant to this
subparagraph.
   (e) Fifteen percent of the money collected pursuant to paragraph
(3) of subdivision (c) of Section 381, up to eighty-one million
dollars ($81,000,000), shall be used for programs designed to provide
customer credits for purchases of renewable energy produced by
certified energy providers, to disseminate information regarding
renewable energy technologies, to promote purchases of renewable
energy, to help develop a consumer market for renewable energy, and
to help develop a consumer market for renewable energy technologies,
as provided in the report, subject to the following requirements:
   (1) (A) Fourteen percent of the money, up to seventy-five million
six hundred thousand dollars ($75,600,000), shall be expended to
provide customer credits for purchases of renewable energy produced
by certified energy providers.  Customer credits shall be awarded to
California retail customers located in the service territory of an
investor-owned utility that is subject to Section 381 who purchase
qualifying renewable electric power through transactions traceable to
specific generation sources by any auditable contract trail or
equivalent that provides commercial verification that the electricity
source claimed has been sold not more than once to a retail
customer.  Credits may be given without regard to whether the power
supplier is also receiving funds under any other subdivision of this
section.
   (B) Credits awarded pursuant to this paragraph may be paid
directly to energy marketers, aggregators, or generators if those
persons or entities account for the credits on the recipient customer'
s utility bills.  Credits shall not exceed one and one-half cents
($0.015) per kilowatthour.  Credits awarded to members of the
combined class of customers, other than residential and small
commercial customers, shall not exceed one thousand dollars ($1,000)
per customer in 1998 and 1999.  Thereafter, the State Energy
Resources Conservation and Development Commission shall determine by
January 10 of each year the average customer incentive rebate level
paid over the preceding calendar year.  In the event that the
payments have remained at the one and one-half cents ($0.015) per
kilowatthour cap over the preceding calendar year, the one thousand
dollars ($1,000) per customer cap shall be removed for that calendar
year, except that in no event shall more than fifteen million dollars
($15,000,000) of the total customer incentive funds be awarded to
members of the combined class of customers other than residential and
small commercial customers.
   (C) Funding for credits pursuant to this paragraph shall be
increased for each successive year during the period from January 1,
1998, to January 1, 2002, to encourage the increasing use of those
credits.
   (D) The State Energy Resources Conservation and Development
Commission shall develop interim criteria and procedures for the
certification of energy providers and for the identification of
energy purchasers who are eligible to receive funds pursuant to this
paragraph through a process consistent with this paragraph.  The
criteria and procedures shall apply only to funding eligibility and
shall not extend to other renewable marketing claims.
   (E) The commission shall notify the State Energy Resources
Conservation and Development Commission in writing within 10 days of
revoking or suspending the registration of any electric service
provider pursuant to paragraph (4) of subdivision (b) of Section
394.25.
   (2) One percent of the money, up to five million four hundred
thousand dollars ($5,400,000), shall be expended to promote renewable
energy and to disseminate information on renewable energy
technologies, including emerging renewable technologies, and to help
develop a consumer market for renewable energy and for small-scale
emerging renewable energy technologies.
   (f) (1) The State Energy Resources Conservation and Development
Commission shall adopt guidelines governing the funding programs
authorized under this section, at a publicly noticed meeting offering
all interested parties an opportunity to comment.  Substantive
changes to the guidelines shall not be adopted without at least 10
days' written notice to the public.  The public notice of meetings
required by this paragraph shall not be less than 30 days.
Notwithstanding any other provision of law, any guidelines adopted
pursuant to this section shall be deemed to satisfy the requirements
of Chapter 3.5 (commencing with Section 11340) of Division 3 of Title
2 of the Government Code.
   (2) The State Energy Resources Conservation and Development
Commission shall, in collaboration with eligible emerging technology
industry stakeholders and consumer interests, complete the emerging
technology program design, as outlined in subdivision (d), and
implement its provisions.
   (3) Awards made pursuant to this section are grants, subject to
appeal to the State Energy Resources Conservation and Development
                                           Commission upon a showing
that factors other than those described in the guidelines adopted by
the State Energy Resources Conservation and Development Commission
were applied in making the awards and payments.  Any actions taken by
an applicant to apply for, or become or remain eligible and
certified to receive, payments or awards, including satisfying
conditions specified by the State Energy Resources Conservation and
Development Commission, shall not constitute the rendering of goods,
services, or a direct benefit to the State Energy Resources
Conservation and Development Commission.
   (g) The State Energy Resources Conservation and Development
Commission shall report to the Legislature on or before May 31, 2000,
and on or before May 31 of every second year thereafter, regarding
the results of the mechanisms funded pursuant to this section.
Reports prepared pursuant to this section shall include a description
of the allocation of funds among existing, new and emerging
technologies; the allocation of funds among programs, including
consumer-side incentives; and the need for the reallocation of money
among those technologies.  The reports shall also address the
allocation of funds from interest on the accounts described in this
section, money in the accounts described in subdivision (e) of
Section 381, and money included in the accounts pursuant to Section
385.  Notwithstanding paragraph (4) of subdivision (b) of Section 383
or subdivisions (b), (c), (d), and (e) of this section, money may be
reallocated without further legislative action among existing, new,
and emerging technologies and consumer-side programs in a manner
consistent with the report.
  SEC. 173.  Section 399.15 of the Public Utilities Code is amended
and renumbered to read:
   379.5.  Notwithstanding any other provision of law, on or before
March 7, 2001, the commission, in consultation with the Independent
System Operator, shall take all of the following actions, and shall
include the reasonable costs involved in taking those actions in the
distribution revenue requirements of utilities regulated by the
commission, as appropriate:
   (a) (1) Identify and undertake those actions necessary to reduce
or remove constraints on the state's existing electrical transmission
and distribution system, including, but not limited to,
reconductoring of transmission lines, the addition of capacitors to
increase voltage, the reinforcement of existing transmission
capacity, and the installation of new transformer banks.  The
commission shall, in consultation with the Independent System
Operator, give first priority to those geographical regions where
congestion reduces or impedes electrical transmission and supply.
   (2) Consistent with the existing statutory authority of the
commission, afford electrical corporations a reasonable opportunity
to fully recover costs it determines are reasonable and prudent to
plan, finance, construct, operate, and maintain any facilities under
its jurisdiction required by this section.
   (b) In consultation with the State Energy Resources Conservation
and Development Commission, adopt energy conservation demand-side
management and other initiatives in order to reduce demand for
electricity and reduce load during peak demand periods.  Those
initiatives shall include, but not be limited to, all of the
following:
   (1) Expansion and acceleration of residential and commercial
weatherization programs.
   (2) Expansion and acceleration of programs to inspect and improve
the operating efficiency of heating, ventilation, and
air-conditioning equipment in new and existing buildings, to ensure
that these systems achieve the maximum feasible cost-effective energy
efficiency.
   (3) Expansion and acceleration of programs to improve energy
efficiency in new buildings, in order to achieve the maximum feasible
reductions in uneconomic energy and peak electricity consumption.
   (4) Incentives to equip commercial buildings with the capacity to
automatically shut down or dim nonessential lighting and
incrementally raise thermostats during a peak electricity demand
period.
   (5) Evaluation of installing local infrastructure to link
temperature setback thermostats to real-time price signals.
   (6) Incentives for load control and distributed generation to be
paid for enhancing reliability.
   (7) Differential incentives for renewable or super clean
distributed generation resources.
   (8) Reevaluation of all efficiency cost-effectiveness tests in
light of increases in wholesale electricity costs and of natural gas
costs to explicitly include the system value of reduced load on
reducing market clearing prices and volatility.
   (c) In consultation with the Energy Resources Conservation and
Development Commission, adopt and implement a residential,
commercial, and industrial peak reduction program that encourages
electric customers to reduce electricity consumption during peak
power periods.
  SEC. 174.  Section 2881.2 of the Public Utilities Code is amended
to read:
   2881.2.  (a) In addition to the requirements of Section 2881, the
commission shall design and implement a program that shall provide
for publicly available telecommunications devices capable of
servicing the needs of the deaf or hearing impaired in existing
buildings, structures, facilities, and public accommodations of the
type specified in Section 4450 of the Government Code and Sections
19955.5 and 19956 of the Health and Safety Code, making available
reasonable access of all phases of public telephone service to
individuals who are deaf or hearing impaired.  The commission shall
direct the appropriate committee under its control to determine and
specify locations within existing buildings, structures, facilities,
and public accommodations in need of a telecommunications device and
to contract for the procurement, installation, and maintenance of
these devices.  In the letting of the contract, the commission shall
direct the committee to ensure consideration of for-profit and
nonprofit corporations, including nonprofit corporations with
demonstrated service to individuals who are deaf or hearing impaired
and whose boards of directors and staff are made up of a majority of
those individuals.  The commission shall also direct the committee to
seek the cooperation of the owners, managers, and tenants of the
existing buildings, structures, facilities, and public accommodations
that have been determined to be in need of a telecommunications
device with regard to its installation and maintenance.  The
commission shall phase in this program over a reasonable period of
time, beginning no later than January 1, 1998, giving priority to
those existing buildings, structures, facilities, and public
accommodations determined by the commission, with the advice and
counsel of statewide nonprofit consumer organizations for the deaf,
to be of most importance and usefulness to the deaf or hearing
impaired.
   (b) The commission shall ensure that costs are recovered as they
are incurred under this section, including any costs incurred by the
owners, managers, or tenants of existing buildings, structures,
facilities, and public accommodations, and shall utilize for this
purpose the rate recovery mechanism established pursuant to
subdivision (d) of Section 2881.  The commission shall also establish
a fund and require separate accounting for the program implemented
under this section and, in addition, shall require that the surcharge
utilized to fund the program not exceed two-hundredths of 1 percent,
that it be combined with the surcharge required by subdivision (d)
of Section 2881, and that it count toward the limits set by that
subdivision.  This surcharge shall be in effect until January 1,
2001.
   (c) "Existing buildings, structures, facilities, and public
accommodations," for the purposes of this section, means those
buildings, structures, facilities, and public accommodations or parts
thereof that were constructed or altered prior to January 26, 1993,
or are otherwise not required by Section 303 of the Americans with
Disabilities Act of 1990 (P.L.  101-336; 42 U.S.C. Sec. 12183) or any
other section of that act and its implementing regulations and
guidelines, to have a publicly available telecommunications device
capable of serving the needs of the deaf or hearing impaired.
  SEC. 175.  Section 7943 of the Public Utilities Code is amended to
read:
   7943.  (a) It is the intent of the Legislature that when the
commission has no reasonable alternative other than to create a new
area code, that the commission do so in a way that creates the least
inconvenience for customers.
   (b) On or before March 31, 2001, the commission shall request that
the Federal Communications Commission grant authority for the
commission to order telephone corporations to assign telephone
numbers dedicated to wireless and data usage to a separate area code
and to permit seven digit dialing within that technology-specific
area code and the underlying preexisting area code or codes.
   (c) Before approving any new area code, the commission shall first
perform a telephone utilization study and implement all reasonable
telephone number conservation measures.
   (d) If the commission receives the grant of authority set forth in
subdivision (b) and determines that further area code relief is
needed, the commission shall exercise the authority granted to it in
subdivision (b) unless it finds at least one of the following:
   (1) Exercising the authority granted by subdivision (b) would be
more disruptive to the customers where area code relief has been
determined to be necessary.
   (2) Exercising the authority granted by subdivision (b) will not
adequately extend the life of the area code where relief has been
determined to be necessary.
   (e) The commission may not implement any authority granted by the
Federal Communications Commission pursuant to subdivision (b), in a
manner that impairs the ability of a customer to have number
portability.
  SEC. 176.  Section 9608 of the Public Utilities Code is amended to
read:
   9608.  Sections 454.1 and 9607 of this code and Section 56133 of
the Government Code do not apply to an irrigation district with
respect to an area to be served by the irrigation district, if all of
the following occur:
   (a) The irrigation district acquires substantially all the
electric distribution facilities and related subtransmission
facilities of any electrical corporation that has an obligation to
provide electric distribution service within the area to be served by
the irrigation district.
   (b) The commission approves a service area agreement between the
irrigation district and the electrical corporation pursuant to
Sections 8101 to 8108, inclusive, which service area agreement
provides that the electrical corporation may not provide electric
distribution service in the area to be served by the irrigation
district and that the irrigation district may not provide electric
distribution service in the remainder of the electrical corporation's
service territory.
   (c) The commission relieves the electrical corporation of its
obligation to serve within the area to be served by the irrigation
district.
  SEC. 177.  Section 9610 of the Public Utilities Code is amended to
read:
   9610.  Commencing on January 1, 2001, and continuing through
December 31, 2025, inclusive, all of the following shall apply:
   (a) An electrical corporation may not provide electric
transmission or distribution service to retail customers in either of
the following areas:
   (1) The Modesto Irrigation District electric service area as
defined in the August 15, 1940, Purchase of Properties agreement
between Modesto Irrigation District and Pacific Gas and Electric
Company.
   (2) The Mountain House Community Services District as defined in
the master specific plan adopted by the Board of Supervisors of the
County of San Joaquin on November 10, 1994.
   (b) (1) Within the purchase zone as described in Exhibit "B" of
The Asset Sale Agreement By and Between Pacific Gas and Electric
Company and Modesto Irrigation District Dated July 23, 1997,
contained in Public Utilities Commission Application Number
97-07-030, Pacific Gas and Electric Company and Modesto Irrigation
District may each provide electric transmission and distribution
service to retail customers.  The area described in this subdivision
shall be considered to be within both Pacific Gas and Electric
Company's and Modesto Irrigation District's electric service area.
   (2) The Legislature recognizes that electrical corporations and
irrigation districts may each construct infrastructure, and that the
infrastructure may, in some cases, be duplicative.  In those cases,
the Legislature encourages irrigation districts and electrical
corporations to enter into agreements pursuant to Sections 8101 to
8108, inclusive, where those agreements further the interests of the
state as set forth in Section 8101.
   (c) Modesto Irrigation District may provide up to 8 megawatts of
peak sales to Contra Costa Water District for delivery to its Old
River Intake Facility and Rock Slough Pumping Plant.
   (d) Except as provided in subdivisions (a), (b), and (c), Modesto
Irrigation District may not provide electric transmission or
distribution service to retail customers in the territory of Pacific
Gas and Electric Company.
  SEC. 178.  Section 12702.5 of the Public Utilities Code is amended
to read:
   12702.5.  (a) Except as specified in subdivision (b), any judicial
action or proceeding against a district that provides electric
utility service, to attack, review, set aside, void, or annul an
ordinance, resolution, or motion fixing or changing a rate or charge
for an electric commodity or an electric service furnished by a
district and adopted on or after July 1, 2000, shall be commenced
within 120 days of the effective date of that ordinance, resolution,
or motion.
   (b) The statute of limitations specified in subdivision (a) does
not apply to any judicial action or proceeding filed pursuant to
Chapter 13.7 (commencing with Section 54999) of Part 1 of Division 2
of Title 5 of the Government Code to protest or challenge a rate or
charge or to seek the refund of a capital facilities fee if the
notice and disclosure requirements of Section 54999.35 of the
Government Code have not been followed.
  SEC. 179.  Section 75.11 of the Revenue and Taxation Code is
amended to read:
   75.11.  (a) If the change in ownership occurs or the new
construction is completed on or after January 1 but on or before May
31, then there shall be two supplemental assessments placed on the
supplemental roll.  The first supplemental assessment shall be the
difference between the new base year value and the taxable value on
the current roll.  In the case of a change in ownership of the full
interest in the real property, the second supplemental assessment
shall be the difference between the new base year value and the
taxable value to be enrolled on the roll being prepared.  If the
change in ownership is of only a partial interest in the real
property, the second supplemental assessment shall be the difference
between the sum of the new base year value of the portion transferred
plus the taxable value on the roll being prepared of the remainder
of the property and the taxable value on the roll being prepared of
the whole property.  For new construction, the second supplemental
assessment shall be the value change due to the new construction.
   (b) If the change in ownership occurs or the new construction is
completed on or after June 1 but before the succeeding January 1,
then the supplemental assessment placed on the supplemental roll
shall be the difference between the new base year value and the
taxable value on the current roll.
   (c) If there are multiple changes in ownership or multiple
completions of new construction, or both, with respect to the same
real property during the same assessment year, then there shall be a
net supplemental assessment placed on the supplemental roll, in
addition to the assessment pursuant to subdivision (a) or (b).  The
net supplemental assessment shall be the most recent new base year
value less the sum of (1) the previous entry or entries placed on the
supplemental roll computed pursuant to subdivision (a) or (b), and
(2) the corresponding taxable value on the current roll or the
taxable value to be entered on the roll being prepared, or both,
depending on the date or dates the change of ownership occurs or new
construction is completed as specified in subdivisions (a) and (b).
   (d) A supplemental assessment authorized by this section is not
valid and does not have any force or effect unless it is placed on
the supplemental roll on or before the applicable date specified in
paragraph (1), (2), or (3), as follows:
   (1) The fourth July 1 following the July 1 of the assessment year
in which either a statement reporting the change in ownership was
filed pursuant to Section 480, 480.1, or 480.2, a preliminary change
in ownership report was filed pursuant to Section 480.3, or the new
construction was completed.
   (2) The sixth July 1 following the July 1 of the assessment year
in which either a statement reporting the change in ownership was
filed pursuant to Section 480, 480.1, or 480.2, a preliminary change
in ownership report was filed pursuant to Section 480.3, or the new
construction was completed, if the penalty provided for in Section
504 is added to the assessment.
   (3) The eighth July 1 following the July 1 of the assessment year
in which the event giving rise to the supplemental assessment
occurred, if the change in ownership or change in control was
unrecorded and a change in ownership statement required by Section
480 or preliminary change in ownership report, as required by Section
480.3, was not timely filed.
   (4) Notwithstanding paragraphs (1), (2), and (3), there is no
limitations period on making a supplemental assessment, if the
penalty provided for in Section 503 is added to the assessment.
   For the purposes of this subdivision, "assessment year" means the
period beginning annually as of 12:01 a.m. on the first day of
January and ending immediately prior to the succeeding first day of
January.
   (e) If, before the expiration of the applicable period specified
in subdivision (d) for making a supplemental assessment, the taxpayer
and the assessor agree in writing to extend the period for making a
supplemental assessment, correction, or claim for refund, a
supplemental assessment may be made at any time prior to the
expiration of that extended period.  The extended period may be
further extended by successive written agreements entered into prior
to the expiration of the most recent extension.
  SEC. 180.  Section 75.21 of the Revenue and Taxation Code is
amended to read:
   75.21.  (a) Exemptions shall be applied to the amount of the
supplemental assessment, provided that the property is not receiving
any other exemption on either the current roll or the roll being
prepared except as provided for in subdivision (b), that the assessee
is eligible for the exemption, and that, in those instances in which
the provisions of this division require the filing of a claim for
the exemption, the assessee makes a claim for the exemption.
   (b) If the property received an exemption on the current roll or
the roll being prepared and the assessee on the supplemental roll is
eligible for an exemption and, in those instances in which the
provisions of this division require the filing of a claim for the
exemption, the assessee makes a claim for an exemption of a greater
amount, then the difference in the amount between the two exemptions
shall be applied to the supplemental assessment.
   (c) In those instances in which the provisions of this division
require the filing of a claim for the exemption, except as provided
in subdivision (d), (e), or (f), any person claiming to be eligible
for an exemption to be applied against the amount of the supplemental
assessment shall file a claim or an amendment to a current claim, in
that form as prescribed by the board, on or before the 30th day
following the date of notice of the supplemental assessment, in order
to receive a 100-percent exemption.
   (1) With respect to property as to which the college, cemetery,
church, religious, exhibition, veterans' organization, free public
libraries, free museums, or welfare exemption was available, but for
which a timely application for exemption was not filed, the following
amounts shall be canceled or refunded:
   (A) Ninety percent of any tax or penalty or interest thereon, or
any amount of tax or penalty or interest thereon exceeding two
hundred fifty dollars ($250) in total amount, whichever is greater,
for each supplemental assessment, provided that an appropriate
application for exemption is filed on or before the date on which the
first installment of taxes on the supplemental tax bill becomes
delinquent, as provided by Section 75.52.
   (B) Eighty-five percent of any tax or penalty or interest thereon,
or any amount of tax or penalty or interest thereon exceeding two
hundred fifty dollars ($250) in total amount, whichever is greater,
for each supplemental assessment, if an appropriate application for
exemption is thereafter filed.
   (2) With respect to property as to which the welfare exemption or
veterans' organization exemption was available, all provisions of
Section 254.5, other than the specified dates for the filing of
affidavits and other acts, are applicable to this section.
   (3) With respect to property as to which the veterans', homeowners'
, or disabled veterans' exemption was available, but for which a
timely application for exemption was not filed, that portion of tax
attributable to 80 percent of the amount of exemption available shall
be canceled or refunded, provided that an appropriate application
for exemption is filed on or before the date on which the first
installment of taxes on the supplemental tax bill becomes delinquent,
as provided by Section 75.52.
   (4) With respect to property as to which any other exemption was
available, but for which a timely application for exemption was not
filed, the following amounts shall be canceled or refunded:
   (A) Ninety percent of any tax or penalty or interest thereon,
provided that an appropriate application for exemption is filed on or
before the date on which the first installment of taxes on the
supplemental tax bill becomes delinquent, as provided by Section
75.52.
   (B) Eighty-five percent of any tax or penalty or interest thereon,
or any amount of tax or penalty or interest thereon exceeding two
hundred fifty dollars ($250) in total amount, whichever is greater,
for each supplemental assessment, if an appropriate application for
exemption is thereafter filed.
   Other provisions of this division pertaining to the late filing of
claims for exemption do not apply to assessments made pursuant to
this chapter.
   (d) For purposes of this section, any claim for the homeowners'
exemption, veterans' exemption, or disabled veterans' exemption
previously filed by the owner of a dwelling, granted and in effect,
constitutes the claim or claims for that exemption required in this
section.  In the event that a claim for the homeowners' exemption,
veterans' exemption, or disabled veterans' exemption is not in
effect, a claim for any of those exemptions for a single supplemental
assessment for a change in ownership or new construction occurring
on or after June 1, up to and including December 31, shall apply to
that assessment; a claim for any of those exemptions for the two
supplemental assessments for a change in ownership or new
construction occurring on or after January 1, up to and including May
31, one for the current fiscal year and one for the following fiscal
year, shall apply to those assessments.  In either case, if granted,
the claim shall remain in effect until title to the property
changes, the owner does not occupy the home as his or her principal
place of residence on the lien date, or the property is otherwise
ineligible pursuant to Section 205, 205.5, or 218.
   (e) Notwithstanding subdivision (c), an additional exemption claim
may not be required to be filed until the next succeeding lien date
in the case in which a supplemental assessment results from the
completion of new construction on property that has previously been
granted exemption on either the current roll or the roll being
prepared.
   (f) (1) Notwithstanding subdivision (c), an additional exemption
claim may not be required to be filed until the next succeeding lien
date in the instance where a supplemental assessment results from a
change in ownership of property where the purchaser of the property
owns and uses or uses, as the case may be, other property that has
been granted the college, cemetery, church, religious, exhibition,
veterans' organization, free public libraries, free museums, or
welfare exemption on either the current roll or the roll being
prepared and the property purchased is put to the same use.  If a
timely application for exemption is not filed on the next succeeding
lien date, then the provisions of paragraph (1) of subdivision (c)
shall apply.
   (2) In all other instances where a supplemental assessment results
from a change in ownership of property, an application for exemption
shall be filed pursuant to the provisions of subdivision (c).
  SEC. 181.  Section 97.3 of the Revenue and Taxation Code is amended
to read:
   97.3.  Notwithstanding any other provision of this chapter, the
computations and allocations made by each county pursuant to Section
96.1 or its predecessor section, as modified by Section 97.2 or its
predecessor section for the 1992-93 fiscal year, shall be modified
for the 1993-94 fiscal year pursuant to subdivisions (a) to (c),
inclusive, as follows:
   (a) The amount of property tax revenue deemed allocated in the
prior fiscal year to each county and city and county shall be reduced
by an amount to be determined by the Director of Finance in
accordance with the following:
   (1) The total amount of the property tax reductions for counties
and cities and counties determined pursuant to this section shall be
one billion nine hundred ninety-eight million dollars
($1,998,000,000) in the 1993-94 fiscal year.
   (2) The Director of Finance shall determine the amount of the
reduction for each county or city and county as follows:
   (A) The proportionate share of the property tax revenue reduction
for each county or city and county that would have been imposed on
all counties under the proposal specified in the "May Revision of the
1993-94 Governor's Budget" shall be determined by reference to the
                                         document entitled "Estimated
County Property Tax Transfers Under Governor's May Revision
Proposal," published by the Legislative Analyst's Office on June 1,
1993.
   (B) Each county's or city and county's proportionate share of
total taxable sales in all counties in the 1991-92 fiscal year shall
be determined.
   (C) An amount for each county and city and county shall be
determined by applying its proportionate share determined pursuant to
subparagraph (A) to the one billion nine hundred ninety-eight
million dollar ($1,998,000,000) statewide reduction for counties and
cities and counties.
   (D) An amount for each county and city and county shall be
determined by applying its proportionate share determined pursuant to
subparagraph (B) to the one billion nine hundred ninety-eight
million dollar ($1,998,000,000) statewide reduction for counties and
cities and counties.
   (E) The Director of Finance shall add the amounts determined
pursuant to subparagraphs (C) and (D) for each county and city and
county, and divide the resulting figure by two.  The amount so
determined for each county and city and county shall be divided by a
factor of 1.038.  The resulting figure shall be the amount of
property tax revenue to be subtracted from the amount of property tax
revenue deemed allocated in the prior fiscal year.
   (3) The Director of Finance shall, by July 15, 1993, report to the
Joint Legislative Budget Committee its determination of the amounts
determined pursuant to paragraph (2).
   (4) On or before August 15, 1993, the Director of Finance shall
notify the auditor of each county and city and county of the amount
of property tax revenue reduction determined for each county and city
and county.
   (5) Notwithstanding any other provision of this subdivision, the
amount of the reduction specified in paragraph (2) for any county or
city and county that has first implemented, for the 1993-94 fiscal
year, the alternative procedure for the distribution of property tax
levies authorized by Chapter 3 (commencing with Section 4701) of Part
8 shall be reduced, for the 1993-94 fiscal year only, in the amount
of any increased revenue allocated to each qualifying school entity
that would not have been allocated for the 1993-94 fiscal year but
for the implementation of that alternative procedure.  For purposes
of this paragraph, "qualifying school entity" means any school
district, county office of education, or community college district
that is not an excess tax school entity as defined in Section 95, and
a county's Educational Revenue Augmentation Fund as described in
subdivision (d) of this section and subdivision (d) of Section 97.2.
Notwithstanding any other provision of this paragraph, the amount of
any reduction calculated pursuant to this paragraph for any county
or city and county shall not exceed the reduction calculated for that
county or city and county pursuant to paragraph (2).
   (6) Notwithstanding the provisions of paragraph (5), the amount of
the reduction specified in paragraph (2) for a county of the 16th
class that has first implemented, for the 1993-94 fiscal year, the
alternative procedure for the distribution of property tax levies
authorized by Chapter 2 (commencing with Section 4701) of Part 8
shall be reduced, for the 1993-94 fiscal year only, in the amount of
any increased revenue distributed to each qualifying school entity
that would not have been distributed for the 1993-94 fiscal year,
pursuant to the historical accounting method of that county of the
16th class, but for the implementation of that alternative procedure.
  For purposes of this paragraph, "qualifying school entity" means
any school district, county office of education, or community college
district that is not an excess tax school entity as defined in
Section 95, and a county's Educational Revenue Augmentation Fund as
described in subdivision (a) of this section and subdivision (d) of
Section 97.2.  Notwithstanding any other provision of this paragraph,
the amount of any reduction calculated pursuant to this paragraph
for any county shall not exceed the reduction calculated for that
county pursuant to paragraph (2).
   (b) The amount of property tax revenue deemed allocated in the
prior fiscal year to each city shall be reduced by an amount to be
determined by the Director of Finance in accordance with the
following:
   (1) The total amount of the property tax reductions determined for
cities pursuant to this section shall be two hundred eighty-eight
million dollars ($288,000,000) in the 1993-94 fiscal year.
   (2) The Director of Finance shall determine the amount of
reduction for each city as follows:
   (A) The amount of property tax revenue that is estimated to be
attributable in the 1993-94 fiscal year to the amount of each city's
state assistance payment received by that city pursuant to Chapter
282 of the Statutes of 1979 shall be determined.
   (B) A factor for each city equal to the amount determined pursuant
to subparagraph (A) for that city, divided by the total of the
amounts determined pursuant to subparagraph (A) for all cities, shall
be determined.
   (C) An amount for each city equal to the factor determined
pursuant to subparagraph (B), multiplied by three hundred eighty-two
million five hundred thousand dollars ($382,500,000), shall be
determined.
   (D) In no event shall the amount for any city determined pursuant
to subparagraph (C) exceed a per capita amount of nineteen dollars
and thirty-one cents ($19.31), as determined in accordance with that
city's population on January 1, 1993, as estimated by the Department
of Finance.
   (E) The amount determined for each city pursuant to subparagraphs
(C) and (D) shall be the amount of property tax revenue to be
subtracted from the amount of property tax revenue deemed allocated
in the prior year.
   (3) The Director of Finance shall, by July 15, 1993, report to the
Joint Legislative Budget Committee those amounts determined pursuant
to paragraph (2).
   (4) On or before August 15, 1993, the Director of Finance shall
notify each county auditor of the amount of property tax revenue
reduction determined for each city located within that county.
   (c) (1) The amount of property tax revenue deemed allocated in the
prior fiscal year to each special district, as defined pursuant to
subdivision (m) of Section 95, shall be reduced by the amount
determined for the district pursuant to paragraph (3) and increased
by the amount determined for the district pursuant to paragraph (4).
The total net amount of these changes is intended to equal two
hundred forty-four million dollars ($244,000,000) in the 1993-94
fiscal year.
   (2) (A) Notwithstanding any other provision of this subdivision,
no reduction shall be made pursuant to this subdivision with respect
to any of the following special districts:
   (i) A local hospital district as described in Division 23
(commencing with Section 32000) of the Health and Safety Code.
   (ii) A water agency that does not sell water at retail, but not
including an agency the primary function of which, as determined on
the basis of total revenues, is flood control.
   (iii) A transit district.
   (iv) A police protection district formed pursuant to Part 1
(commencing with Section 20000) of Division 14 of the Health and
Safety Code.
   (v) A special district that was a multicounty special district as
of July 1, 1979.
   (B) Notwithstanding any other provision of this subdivision, the
first one hundred four thousand dollars ($104,000) of the amount of
any reduction that otherwise would be made under this subdivision
with respect to a qualifying community services district shall be
excluded.  For purposes of this subparagraph, a "qualifying community
services district" means a community services district that meets
all of the following requirements:
   (i) Was formed pursuant to Division 3 (commencing with Section
61000) of Title 6 of the Government Code.
   (ii) Succeeded to the duties and properties of a police protection
district upon the dissolution of that district.
   (iii) Currently provides police protection services to
substantially the same territory as did that district.
   (iv) Is located within a county in which the board of supervisors
has requested the Department of Finance that this subparagraph be
operative in the county.
   (3) (A) On or before September 15, 1993, the county auditor shall
determine an amount for each special district equal to the amount of
its allocation determined pursuant to Section 96 or 96.1, and Section
96.5 or their predecessor sections for the 1993-94 fiscal year
multiplied by the ratio determined pursuant to paragraph (1) of
subdivision (a) of former Section 98.6 as that section read on June
15, 1993.  In those counties that were subject to former Sections
98.66, 98.67, and 98.68, as those sections read on that same date,
the county auditor shall determine an amount for each special
district that represents the current amount of its allocation
determined pursuant to Section 96 or 96.1, and Section 96.5 or their
predecessor sections for the 1993-94 fiscal year that is attributed
to the property tax shift from schools required by Chapter 282 of the
Statutes of 1979.  In that county subject to Section 100.4, the
county auditor shall determine an amount for each special district
that represents the current amount of its allocations determined
pursuant to Section 96, 96.1, 96.5, or 100.4 or their predecessor
sections for the 1993-94 fiscal year that is attributable to the
property tax shift from schools required by Chapter 282 of the
Statutes of 1979.  In determining these amounts, the county auditor
shall adjust for the influence of increased assessed valuation within
each district, including the effect of jurisdictional changes, and
the reductions in property tax allocations required in the 1992-93
fiscal year by Chapters 699 and 1369 of the Statutes of 1992.  In the
case of a special district that has been consolidated or
reorganized, the auditor shall determine the amount of its current
property tax allocation that is attributable to the prior district's
or districts' receipt of state assistance payments pursuant to
Chapter 282 of the Statutes of 1979.  Notwithstanding any other
provision of this paragraph, for a special district that is governed
by a city council or whose governing board has the same membership as
a city council and that is a subsidiary district as defined in
subdivision (e) of Section 16271 of the Government Code, the county
auditor shall multiply the amount that otherwise would be calculated
pursuant to this paragraph by 0.38 and the result shall be used in
the calculations required by paragraph (5).  In no event shall the
amount determined by this paragraph be less than zero.
   (B) Notwithstanding subparagraph (A), commencing with the 1994-95
fiscal year, in the County of Sacramento, the auditor shall determine
the amount for each special district that represents the current
amount of its allocations determined pursuant to Section 96, 96.1,
96.5, or 100.6 for the 1994-95 fiscal year that is attributed to the
property tax shift from schools required by Chapter 282 of the
Statutes of 1979.
   (4) (A) (i) On or before September 15, 1993, the county auditor
shall determine an amount for each special district that is engaged
in fire protection activities, as reported to the Controller for
inclusion in the 1989-90 edition of the Financial Transactions Report
Concerning Special Districts under the heading of "Fire Protection,"
that is equal to the amount of revenue allocated to that special
district from the Special District Augmentation Fund for fire
protection activities in the 1992-93 fiscal year.  For purposes of
the preceding sentence for counties of the second class, the phrase
"amount of revenue allocated to that special district" means an
amount of revenue that was identified for transfer to that special
district, rather than the amount of revenue that was actually
received by that special district pursuant to that transfer.
   (ii) In the case of a special district, other than a special
district governed by the county board of supervisors or whose
governing body is the same as the county board of supervisors, that
is engaged in fire protection activities as reported to the
Controller, the county auditor shall also determine the amount by
which the district's amount determined pursuant to paragraph (3)
exceeds the amount by which its allocation was reduced by operation
of former Section 98.6 in the 1992-93 fiscal year.  This amount shall
be added to the amount otherwise determined for the district under
this paragraph.  In any county subject to former Section 98.65,
98.66, 98.67, or 98.68 in that same fiscal year, the county auditor
shall determine for each special district that is engaged in fire
protection activities an amount that is equal to the amount
determined for that district pursuant to paragraph (3).
   (B) For purposes of this paragraph, a special district includes
any special district that is allocated property tax revenue pursuant
to this chapter and does not appear in the State Controller's Report
on Financial Transactions Concerning Special Districts, but is
engaged in fire protection activities and appears in the State
Controller's Report on Financial Transactions Concerning Counties.
   (5) The total amount of property taxes allocated to special
districts by the county auditor as a result of paragraph (4) shall be
subtracted from the amount of property tax revenues not allocated to
special districts by the county auditor as a result of paragraph (3)
to determine the amount to be deposited in the Education Revenue
Augmentation Fund as specified in subdivision (d).
   (6) On or before September 30, 1993, the county auditor shall
notify the Director of Finance of the net amount determined for
special districts pursuant to paragraph (5).
   (d) (1) The amount of property tax revenues not allocated to the
county, city and county, cities within the county, and special
districts as a result of the reductions required by subdivisions (a),
(b), and (c) shall instead be deposited in the Educational Revenue
Augmentation Fund established in each county or city and county
pursuant to Section 97.2.  The amount of revenue in the Educational
Revenue Augmentation Fund, derived from whatever source, shall be
allocated pursuant to paragraphs (2) and (3) to school districts and
county offices of education, in total, and to community college
districts, in total, in the same proportion that property tax
revenues were distributed to school districts and county offices of
education, in total, and community college districts, in total,
during the 1992-93 fiscal year.
   (2) The county auditor shall, based on information provided by the
county superintendent of schools pursuant to this paragraph,
allocate that proportion of the revenue in the Educational Revenue
Augmentation Fund to be allocated to school districts and county
offices of education only to those school districts and county
offices of education within the county that are not excess tax school
entities, as defined in subdivision (n) of Section 95.  The county
superintendent of schools shall determine the amount to be allocated
to each school district in inverse proportion to the amounts of
property tax revenue per average daily attendance in each school
district.  For each county office of education, the allocation shall
be made based on the historical split of base property tax revenue
between the county office of education and school districts within
the county.  In no event shall any additional money be allocated from
the Educational Revenue Augmentation Fund to a school district or
county office of education upon that district or county office of
education becoming an excess tax school entity.  If, after
determining the amount to be allocated to each school district and
county office of education, the county superintendent of schools
determines there are still additional funds to be allocated, the
county superintendent of schools shall determine the remainder to be
allocated in inverse proportion to the amounts of property tax
revenue, excluding Educational Revenue Augmentation Fund moneys, per
average daily attendance in each remaining school district, and on
the basis of the historical split described above for each county
office of education that is not an excess tax school entity, until
all funds that would not result in a school district or county office
of education becoming an excess tax school entity are allocated.
The county superintendent of schools may determine the amounts to be
allocated between each school district and county office of education
to ensure that all funds that would not result in a school district
or county office of education becoming an excess tax school entity
are allocated.
   (3) The county auditor shall, based on information provided by the
Chancellor of the California Community Colleges pursuant to this
paragraph, allocate that proportion of the revenue in the Educational
Revenue Augmentation Fund to be allocated to community college
districts only to those community college districts within the county
that are not excess tax school entities, as defined in subdivision
(n) of Section 95.  The chancellor shall determine the amount to be
allocated to each community college district in inverse proportion to
the amounts of property tax revenue per funded full-time equivalent
student in each community college district.  In no event shall any
additional money be allocated from the Educational Revenue
Augmentation Fund to a community college district upon that district
becoming an excess tax school entity.
   (4) (A) If, after making the allocation required pursuant to
paragraph (2), the auditor determines that there are still additional
funds to be allocated, the auditor shall allocate those excess funds
pursuant to paragraph (3).  If, after making the allocation pursuant
to paragraph (3), the auditor determines that there are still
additional funds to be allocated, the auditor shall allocate those
excess funds pursuant to paragraph (2).  If, after determining the
amount to be allocated to each community college district, the
Chancellor of the California Community Colleges determines that there
are still additional funds to be allocated, the Chancellor of the
California Community Colleges shall determine the remainder to be
allocated to each community college district in inverse proportion to
the amounts of property tax revenue, excluding Educational Revenue
Augmentation Fund moneys, per funded full-time equivalent student in
each remaining community college district that is not an excess tax
school entity until all funds that would not result in a community
college district becoming an excess tax school entity are allocated.

   (B) (i) For the 1995-96 fiscal year and each fiscal year
thereafter, if, after making the allocations pursuant to paragraphs
(2) and (3) and subparagraph (A), the auditor determines that there
are still additional funds to be allocated, the auditor shall,
subject to clauses (ii) and (iii), allocate those excess funds to the
county superintendent of schools.  Funds allocated pursuant to this
clause shall be counted as property tax revenues for special
education programs in augmentation of the amount calculated pursuant
to Section 2572 of the Education Code, to the extent that those
property tax revenues offset state aid for county offices of
education and school districts within the county pursuant to
subdivision (c) of Section 56836.08 of the Education Code.  If, for
the 2000-01 fiscal year or any fiscal year thereafter, any additional
revenues remain after the implementation of this clause, the auditor
shall allocate those remaining revenues among the county, cities,
and special districts in proportion to the amounts of ad valorem
property tax revenue otherwise required to be shifted from those
local agencies to the county's Educational Revenue Augmentation Fund
for the relevant fiscal year.
   (ii) For the 1995-96 fiscal year only, clause (i) shall have no
application to the County of Mono and the amount allocated pursuant
to clause (i) in the County of Marin shall not exceed five million
dollars ($5,000,000).
   (iii) For the 1996-97 fiscal year only, the total amount of funds
allocated by the auditor pursuant to clause (i) and clause (i) of
subparagraph (B) of paragraph (4) of subdivision (d) of Section 97.2
shall not exceed that portion of two million five hundred thousand
dollars ($2,500,000) that corresponds to the county's proportionate
share of all moneys allocated pursuant to clause (i) and clause (i)
of subparagraph (B) of paragraph (4) of subdivision (d) of Section
97.2 for the 1995-96 fiscal year.  Upon the request of the auditor,
the Department of Finance shall provide to the auditor all
information in the department's possession that is necessary for the
auditor to comply with this clause.
   (iv) Notwithstanding clause (i) of this subparagraph, for the
1999-2000 fiscal year only, if, after making the allocations pursuant
to paragraphs (2) and (3) and subparagraph (A), the auditor
determines that there are still additional funds to be allocated, the
auditor shall allocate the funds to the county, cities, and special
districts in proportion to the amounts of ad valorem property tax
revenue otherwise required to be shifted from those local agencies to
the county's Educational Revenue Augmentation Fund for the relevant
fiscal year.  The amount allocated pursuant to this clause shall not
exceed eight million two hundred thirty-nine thousand dollars
($8,239,000), as appropriated in Item 6110-250-0001 of Section 2.00
of the Budget Act of 1999 (Chapter 50, Statutes of 1999).
   (C) For purposes of allocating the Educational Revenue
Augmentation Fund for the 1996-97 fiscal year, the auditor shall,
after making the allocations for special education programs, if any,
required by subparagraph (B), allocate all remaining funds among the
county, cities, and special districts in proportion to the amounts of
ad valorem property tax revenue otherwise required to be shifted
from those local agencies to the county's Educational Revenue
Augmentation Fund for the relevant fiscal year.  For purposes of ad
valorem property tax revenue allocations for the 1997-98 fiscal year
and each fiscal year thereafter, no amount of ad valorem property tax
revenue allocated to the county, a city, or a special district
pursuant to this subparagraph shall be deemed to be an amount of ad
valorem property tax revenue allocated to that local agency in the
prior fiscal year.
   (5) For purposes of allocations made pursuant to Section 96.1 for
the 1994-95 fiscal year, the amounts allocated from the Educational
Revenue Augmentation Fund pursuant to this subdivision, other than
those amounts deposited in the Educational Revenue Augmentation Fund
pursuant to any provision of the Health and Safety Code, shall be
deemed property tax revenue allocated to the Educational Revenue
Augmentation Fund in the prior fiscal year.
  SEC. 182.  Section 214 of the Revenue and Taxation Code is amended
to read:
   214.  (a) Property used exclusively for religious, hospital,
scientific, or charitable purposes owned and operated by community
chests, funds, foundations or corporations organized and operated for
religious, hospital, scientific, or charitable purposes is exempt
from taxation, including ad valorem taxes to pay the interest and
redemption charges on any indebtedness approved by the voters prior
to July 1, 1978, or any bonded indebtedness for the acquisition or
improvement of real property approved on or after July 1, 1978, by
two-thirds of the votes cast by the voters voting on the proposition,
if:
   (1) The owner is not organized or operated for profit.  However,
in the case of hospitals, the organization shall not be deemed to be
organized or operated for profit if, during the immediately preceding
fiscal year, operating revenues, exclusive of gifts, endowments and
grants-in-aid, did not exceed operating expenses by an amount
equivalent to 10 percent of those operating expenses.  As used
herein, operating expenses include depreciation based on cost of
replacement and amortization of, and interest on, indebtedness.
   (2) No part of the net earnings of the owner inures to the benefit
of any private shareholder or individual.
   (3) The property is used for the actual operation of the exempt
activity, and does not exceed an amount of property reasonably
necessary to the accomplishment of the exempt purpose.
   (A) For the purposes of determining whether the property is used
for the actual operation of the exempt activity, consideration shall
not be given to use of the property for either or both of the
following described activities if that use is occasional:
   (i) The owner conducts fundraising activities on the property and
the proceeds derived from those activities are not unrelated business
taxable income, as defined in Section 512 of the Internal Revenue
Code, of the owner and are used to further the exempt activity of the
owner.
   (ii) The owner permits any other organization that meets all of
the requirements of this subdivision, other than ownership of the
property, to conduct fundraising activities on the property and the
proceeds derived from those activities are not unrelated business
taxable income, as defined in Section 512 of the Internal Revenue
Code, of the organization, are not subject to the tax on unrelated
business taxable income that is imposed by Section 511 of the
Internal Revenue Code, and are used to further the exempt activity of
the organization.
   (B) For purposes of subparagraph (A):
   (i) "Occasional use" means use of the property on an irregular or
intermittent basis by the qualifying owner or any other qualifying
organization described in clause (ii) of subparagraph (A) that is
incidental to the primary activities of the owner or the other
organization.
   (ii) "Fundraising activities" means both activities involving the
direct solicitation of money or other property and the anticipated
exchange of goods or services for money between the soliciting
organization and the organization or person solicited.
   (C) Subparagraph (A) shall have no application in determining
whether paragraph (3) has been satisfied unless the owner of the
property and any other organization using the property as provided in
subparagraph (A) have filed with the assessor duplicate copies of
valid unrevoked letters or rulings from the Internal Revenue Service
that state that the owner and the other organization qualify as
exempt organizations under Section 501(c)(3) of the Internal Revenue
Code.  The owner of the property and any other organization
                                 using the property as provided in
subparagraph (A) also shall file duplicate copies of their most
recently filed federal income tax returns.
   (D) For the purposes of determining whether the property is used
for the actual operation of the exempt activity, consideration shall
not be given to the use of the property for meetings conducted by any
other organization if the meetings are incidental to the other
organization's primary activities, are not fundraising meetings or
activities as defined in subparagraph (B), are held no more than once
per week, and the other organization and its use of the property
meet all other requirements of paragraphs (1) to (5), inclusive, of
subdivision (a).  The owner of the other organization also shall file
with the assessor duplicate copies of valid, unrevoked letters or
rulings from the Internal Revenue Service or the Franchise Tax Board
stating that the other organization, or the national organization of
which it is a local chapter or affiliate, qualifies as an exempt
organization under Section 501(c)(3) or Section 501(c)(4) of the
Internal Revenue Code or Section 23701d, 23701f, or 23701w, together
with duplicate copies of that organization's most recently filed
federal income tax return, if the organization is required by federal
law to file a return.
   Nothing in subparagraph (A), (B), (C), or (D) shall be construed
to either enlarge or restrict the exemption provided for in
subdivision (b) of Section 4 and Section 5 of Article XIII of the
California Constitution and this section.
   (4) The property is not used or operated by the owner or by any
other person so as to benefit any officer, trustee, director,
shareholder, member, employee, contributor, or bondholder of the
owner or operator, or any other person, through the distribution of
profits, payment of excessive charges or compensations, or the more
advantageous pursuit of their business or profession.
   (5) The property is not used by the owner or members thereof for
fraternal or lodge purposes, or for social club purposes except where
that use is clearly incidental to a primary religious, hospital,
scientific, or charitable purpose.
   (6) The property is irrevocably dedicated to religious,
charitable, scientific, or hospital purposes and upon the
liquidation, dissolution or abandonment of the owner will not inure
to the benefit of any private person except a fund, foundation, or
corporation organized and operated for religious, hospital,
scientific, or charitable purposes.
   (7) The property, if used exclusively for scientific purposes, is
used by a foundation or institution that, in addition to complying
with the foregoing requirements for the exemption of charitable
organizations in general, has been chartered by the Congress of the
United States (except that this requirement shall not apply when the
scientific purposes are medical research), and whose objects are the
encouragement or conduct of scientific investigation, research, and
discovery for the benefit of the community at large.
   The exemption provided for herein shall be known as the "welfare
exemption."  This exemption shall be in addition to any other
exemption now provided by law, and the existence of the exemption
provision in paragraph (2) of subdivision (a) of Section 202 shall
not preclude the exemption under this section for museum or library
property.  Except as provided in subdivision (e), this section shall
not be construed to enlarge the college exemption.
   (b) Property used exclusively for school purposes of less than
collegiate grade and owned and operated by religious, hospital, or
charitable funds, foundations, or corporations, which property and
funds, foundations, or corporations meet all of the requirements of
subdivision (a), shall be deemed to be within the exemption provided
for in subdivision (b) of Section 4 and Section 5 of Article XIII of
the California Constitution and this section.
   (c) Property used exclusively for nursery school purposes and
owned and operated by religious, hospital, or charitable funds,
foundations, or corporations, which property and funds, foundations,
or corporations meet all the requirements of subdivision (a), shall
be deemed to be within the exemption provided for in subdivision (b)
of Section 4 and Section 5 of Article XIII of the California
Constitution and this section.
   (d) Property used exclusively for a noncommercial educational FM
broadcast station or an educational television station, and owned and
operated by religious, hospital, scientific, or charitable funds,
foundations, or corporations meeting all of the requirements of
subdivision (a), shall be deemed to be within the exemption provided
for in subdivision (b) of Section 4 and Section 5 of Article XIII of
the California Constitution and this section.
   (e) Property used exclusively for religious, charitable,
scientific, or hospital purposes and owned and operated by religious,
hospital, scientific, or charitable funds, foundations, or
corporations or educational institutions of collegiate grade, as
defined in Section 203, which property and funds, foundations,
corporations, or educational institutions meet all of the
requirements of subdivision (a), shall be deemed to be within the
exemption provided for in subdivision (b) of Section 4 and Section 5
of Article XIII of the California Constitution and this section.  As
to educational institutions of collegiate grade, as defined in
Section 203, the requirements of paragraph (6) of subdivision (a)
shall be deemed to be met if both of the following are met:
   (1) The property of the educational institution is irrevocably
dedicated in its articles of incorporation to charitable and
educational purposes, to religious and educational purposes, or to
educational purposes.
   (2) The articles of incorporation of the educational institution
provide for distribution of its property upon its liquidation,
dissolution, or abandonment to a fund, foundation, or corporation
organized and operated for religious, hospital, scientific,
charitable, or educational purposes meeting the requirements for
exemption provided by Section 203 or this section.
   (f) Property used exclusively for housing and related facilities
for elderly or handicapped families and financed by, including, but
not limited to, the federal government pursuant to Section 202 of
Public Law 86-372 (12 U.S.C. Sec. 1701q), as amended, Section 231 of
Public Law 73-479 (12 U.S.C.  Sec. 1715v), Section 236 of Public Law
90-448 (12 U.S.C. Sec. 1715z), or Section 811 of Public Law 101-625
(42 U.S.C. Sec. 8013), and owned and operated by religious, hospital,
scientific, or charitable funds, foundations, or corporations
meeting all of the requirements of this section shall be deemed to be
within the exemption provided for in subdivision (b) of Section 4
and Section 5 of Article XIII of the California Constitution and this
section.
   The amendment of this paragraph made by Chapter 1102 of the
Statutes of 1984 does not constitute a change in, but is declaratory
of, the existing law.  However, no refund of property taxes shall be
required as a result of this amendment for any fiscal year prior to
the fiscal year in which the amendment takes effect.
   Property used exclusively for housing and related facilities for
elderly or handicapped families at which supplemental care or
services designed to meet the special needs of elderly or handicapped
residents are not provided, or that is not financed by the federal
government pursuant to Section 202 of Public Law 86-372 (12 U.S.C.
Sec. 1701q), as amended, Section 231 of Public Law 73-479 (12 U.S.C.
Sec. 1715v), Section 236 of Public Law 90-448 (12 U.S.C.  Sec.
1715z), or Section 811 of Public Law 101-625 (42 U.S.C. Sec. 8013),
shall not be entitled to exemption pursuant to this subdivision
unless the property is used for housing and related facilities for
low- and moderate-income elderly or handicapped families.  Property
that would otherwise be exempt pursuant to this subdivision, except
that it includes some housing and related facilities for other than
low- or moderate-income elderly or handicapped families, shall be
entitled to a partial exemption.  The partial exemption shall be
equal to that percentage of the value of the property that is equal
to the percentage that the number of low- and moderate-income elderly
and handicapped families occupying the property represents of the
total number of families occupying the property.
   As used in this subdivision, "low and moderate income" has the
same meaning as the term "persons and families of low or moderate
income" as defined by Section 50093 of the Health and Safety Code.
   (g) (1) Property used exclusively for rental housing and related
facilities and owned and operated by religious, hospital, scientific,
or charitable funds, foundations, or corporations, including limited
partnerships in which the managing general partner is an eligible
nonprofit corporation, meeting all of the requirements of this
section, or by veterans' organizations, as described in Section
215.1, meeting all the requirements of paragraphs (1) to (7),
inclusive, of subdivision (a), shall be deemed to be within the
exemption provided for in subdivision (b) of Section 4 and Section 5
of Article XIII of the California Constitution and this section and
shall be entitled to a partial exemption equal to that percentage of
the value of the property that the portion of the property serving
lower income households represents of the total property in any year
in which either of the following criteria applies:
   (A) The acquisition, rehabilitation, development, or operation of
the property, or any combination of these factors, is financed with
tax-exempt mortgage revenue bonds or general obligation bonds, or is
financed by local, state, or federal loans or grants and the rents of
the occupants who are lower income households do not exceed those
prescribed by deed restrictions or regulatory agreements pursuant to
the terms of the financing or financial assistance.
   (B) The owner of the property is eligible for and receives
low-income housing tax credits pursuant to Section 42 of the Internal
Revenue Code of 1986, as added by Public Law 99-514.
   (C) In the case of a claim, other than a claim with respect to
property owned by a limited partnership in which the managing general
partner is an eligible nonprofit corporation, that is filed for the
2000-01 fiscal year or any fiscal year thereafter, 90 percent or more
of the occupants of the property are lower income households whose
rent does not exceed the rent prescribed by Section 50053 of the
Health and Safety Code.  The total exemption amount allowed under
this subdivision to a taxpayer, with respect to a single property or
multiple properties for any fiscal year on the sole basis of the
application of this subparagraph, may not exceed twenty thousand
dollars ($20,000) of tax.
   (2) In order to be eligible for the exemption provided by this
subdivision, the owner of the property shall do both of the
following:
   (A) (i) For any claim filed for the 2000-01 fiscal year or any
fiscal year thereafter, certify and ensure, subject to the limitation
in clause (ii), that there is an enforceable and verifiable
agreement with a public agency, a recorded deed restriction, or other
legal document that restricts the project's usage and that provides
that the units designated for use by lower income households are
continuously available to or occupied by lower income households at
rents that do not exceed those prescribed by Section 50053 of the
Health and Safety Code, or, to the extent that the terms of federal,
state, or local financing or financial assistance conflicts with
Section 50053, rents that do not exceed those prescribed by the terms
of the financing or financial assistance.
   (ii) In the case of a limited partnership in which the managing
general partner is an eligible nonprofit corporation, the restriction
and provision specified in clause (i) shall be contained in an
enforceable and verifiable agreement with a public agency, or in a
recorded deed restriction to which the limited partnership certifies.

   (B) Certify that the funds that would have been necessary to pay
property taxes are used to maintain the affordability of, or reduce
rents otherwise necessary for, the units occupied by lower income
households.
   (3) As used in this subdivision, "lower income households" has the
same meaning as the term "lower income households" as defined by
Section 50079.5 of the Health and Safety Code.
   (h) Property used exclusively for an emergency or temporary
shelter and related facilities for homeless persons and families and
owned and operated by religious, hospital, scientific, or charitable
funds, foundations, or corporations meeting all of the requirements
of this section shall be deemed to be within the exemption provided
for in subdivision (b) of Section 4 and Section 5 of Article XIII of
the California Constitution and this section.  Property that
otherwise would be exempt pursuant to this subdivision, except that
it includes housing and related facilities for other than an
emergency or temporary shelter, shall be entitled to a partial
exemption.
   As used in this subdivision, "emergency or temporary shelter"
means a facility that would be eligible for funding pursuant to
Chapter 11 (commencing with Section 50800) of Part 2 of Division 31
of the Health and Safety Code.
   (i) Property used exclusively for housing and related facilities
for employees of religious, charitable, scientific, or hospital
organizations that meet all the requirements of subdivision (a) and
owned and operated by funds, foundations, or corporations that meet
all the requirements of subdivision (a) shall be deemed to be within
the exemption provided for in subdivision (b) of Sections 4 and 5 of
Article XIII of the California Constitution and this section to the
extent the residential use of the property is institutionally
necessary for the operation of the organization.
   (j) For purposes of this section, charitable purposes include
educational purposes.  For purposes of this subdivision, "educational
purposes" means those educational purposes and activities for the
benefit of the community as a whole or an unascertainable and
indefinite portion thereof, and shall not include those educational
purposes and activities that are primarily for the benefit of an
organization's shareholders.  Educational activities include the
study of relevant information, the dissemination of that information
to interested members of the general public, and the participation of
interested members of the general public.
  SEC. 183.  Section 23622.8 of the Revenue and Taxation Code is
amended to read:
   23622.8.  (a) For each taxable year beginning on or after January
1, 1998, there shall be allowed a credit against the "tax" (as
defined in Section 23036) to a qualified taxpayer for hiring a
qualified disadvantaged individual during the taxable year for
employment in the Manufacturing Enhancement Area.  The credit shall
be equal to the sum of each of the following:
   (1) Fifty percent of the qualified wages in the first year of
employment.
   (2) Forty percent of the qualified wages in the second year of
employment.
   (3) Thirty percent of the qualified wages in the third year of
employment.
   (4) Twenty percent of the qualified wages in the fourth year of
employment.
   (5) Ten percent of the qualified wages in the fifth year of
employment.
   (b) For purposes of this section:
   (1) "Qualified wages" means:
   (A) That portion of wages paid or incurred by the qualified
taxpayer during the taxable year to qualified disadvantaged
individuals that does not exceed 150 percent of the minimum wage.
   (B) The total amount of qualified wages which may be taken into
account for purposes of claiming the credit allowed under this
section shall not exceed two million dollars ($2,000,000) per taxable
year.
   (C) Wages received during the 60-month period beginning with the
first day the qualified disadvantaged individual commences employment
with the qualified taxpayer.  Reemployment in connection with any
increase, including a regularly occurring seasonal increase, in the
trade or business operations of the qualified taxpayer does not
constitute commencement of employment for purposes of this section.
   (D) Qualified wages do not include any wages paid or incurred by
the qualified taxpayer on or after the Manufacturing Enhancement Area
expiration date.  However, wages paid or incurred with respect to
qualified employees who are employed by the qualified taxpayer within
the Manufacturing Enhancement Area within the 60-month period prior
to the Manufacturing Enhancement Area expiration date shall continue
to qualify for the credit under this section after the Manufacturing
Enhancement Area expiration date, in accordance with all provisions
of this section applied as if the Manufacturing Enhancement Area
designation were still in existence and binding.
   (2) "Minimum wage" means the wage established by the Industrial
Welfare Commission as provided for in Chapter 1 (commencing with
Section 1171) of Part 4 of Division 2 of the Labor Code.
   (3) "Manufacturing Enhancement Area" means an area designated
pursuant to Section 7073.8 of the Government Code according to the
procedures of Chapter 12.8 (commencing with Section 7070) of Division
7 of Title 1 of the Government Code.
   (4) "Manufacturing Enhancement Area expiration date" means the
date the Manufacturing Enhancement Area designation expires, is no
longer binding, or becomes inoperative.
   (5) "Qualified disadvantaged individual" means an individual who
satisfies all of the following requirements:
   (A) (i) At least 90 percent of whose services for the qualified
taxpayer during the taxable year are directly related to the conduct
of the qualified taxpayer's trade or business located in a
Manufacturing Enhancement Area.
   (ii) Who performs at least 50 percent of his or her services for
the qualified taxpayer during the taxable year in the Manufacturing
Enhancement Area.
   (B) Who is hired by the qualified taxpayer after the designation
of the area as a Manufacturing Enhancement Area in which the
individual's services were primarily performed.
   (C) Who is any of the following immediately preceding the
individual's commencement of employment with the qualified taxpayer:

   (i) An individual who has been determined eligible for services
under the federal Job Training Partnership Act (former 29 U.S.C. Sec.
1501 et seq.), or its successor.
   (ii) Any voluntary or mandatory registrant under the Greater
Avenues for Independence Act of 1985, or its successor, as provided
pursuant to Article 3.2 (commencing with Section 11320) of Chapter 2
of Part 3 of Division 9 of the Welfare and Institutions Code.
   (iii) Any individual who has been certified eligible by the
Employment Development Department under the federal Targeted Jobs Tax
Credit Program, or its successor, whether or not this program is in
effect.
   (6) "Qualified taxpayer" means any corporation engaged in a trade
or business within a Manufacturing Enhancement Area designated
pursuant to Section 7073.8 of the Government Code and that meets all
of the following requirements:
   (A) Is engaged in those lines of business described in Codes 0211
to 0291, inclusive, Code 0723, or in Codes 2011 to 3999, inclusive,
of the Standard Industrial Classification (SIC) Manual published by
the United States Office of Management and Budget, 1987 edition.
   (B) At least 50 percent of the qualified taxpayer's workforce
hired after the designation of the Manufacturing Enhancement Area is
composed of individuals who, at the time of hire, are residents of
the county in which the Manufacturing Enhancement Area is located.
   (C) Of this percentage of local hires, at least 30 percent shall
be qualified disadvantaged individuals.
   (7) "Seasonal employment" means employment by a qualified taxpayer
that has regular and predictable substantial reductions in trade or
business operations.
   (c) (1) For purposes of this section, all of the following apply:

   (A) All employees of all corporations that are members of the same
controlled group of corporations shall be treated as employed by a
single qualified taxpayer.
   (B) The credit (if any) allowable by this section with respect to
each member shall be determined by reference to its proportionate
share of the expenses of the qualified wages giving rise to the
credit and shall be allocated in that manner.
   (C) Principles that apply in the case of controlled groups of
corporations, as specified in subdivision (d) of Section 23622.7,
shall apply with respect to determining employment.
   (2) If a qualified taxpayer acquires the major portion of a trade
or business of another employer (hereinafter in this paragraph
referred to as the "predecessor") or the major portion of a separate
unit of a trade or business of a predecessor, then, for purposes of
applying this section (other than subdivision (d)) for any calendar
year ending after that acquisition, the employment relationship
between a qualified disadvantaged individual and a qualified taxpayer
shall not be treated as terminated if the qualified disadvantaged
individual continues to be employed in that trade or business.
   (d) (1) (A) If the employment, other than seasonal employment, of
any qualified disadvantaged individual, with respect to whom
qualified wages are taken into account under subdivision (b) is
terminated by the qualified taxpayer at any time during the first 270
days of that employment (whether or not consecutive) or before the
close of the 270th calendar day after the day in which that qualified
disadvantaged individual completes 90 days of employment with the
qualified taxpayer, the tax imposed by this part for the taxable year
in which that employment is terminated shall be increased by an
amount equal to the credit allowed under subdivision (a) for that
taxable year and all prior taxable years attributable to qualified
wages paid or incurred with respect to that qualified disadvantaged
individual.
   (B) If the seasonal employment of any qualified disadvantaged
individual, with respect to whom qualified wages are taken into
account under subdivision (a) is not continued by the qualified
taxpayer for a period of 270 days of employment during the 60-month
period beginning with the day the qualified disadvantaged individual
commences seasonal employment with the qualified taxpayer, the tax
imposed by this part, for the taxable year that includes the 60th
month following the month in which the qualified disadvantaged
individual commences seasonal employment with the qualified taxpayer,
shall be increased by an amount equal to the credit allowed under
subdivision (a) for that taxable year and all prior taxable years
attributable to qualified wages paid or incurred with respect to that
qualified disadvantaged individual.
   (2) (A) Subparagraph (A) of paragraph (1) does not apply to any of
the following:
   (i) A termination of employment of a qualified disadvantaged
individual who voluntarily leaves the employment of the qualified
taxpayer.
   (ii) A termination of employment of a qualified disadvantaged
individual who, before the close of the period referred to in
subparagraph (A) of paragraph (1), becomes disabled to perform the
services of that employment, unless that disability is removed before
the close of that period and the qualified taxpayer fails to offer
reemployment to that individual.
   (iii) A termination of employment of a qualified disadvantaged
individual, if it is determined that the termination was due to the
misconduct (as defined in Sections 1256-30 to 1256-43, inclusive, of
Title 22 of the California Code of Regulations) of that individual.
   (iv) A termination of employment of a qualified disadvantaged
individual due to a substantial reduction in the trade or business
operations of the qualified taxpayer.
   (v) A termination of employment of a qualified disadvantaged
individual, if that individual is replaced by other qualified
disadvantaged individuals so as to create a net increase in both the
number of employees and the hours of employment.
   (B) Subparagraph (B) of paragraph (1) shall not apply to any of
the following:
   (i) A failure to continue the seasonal employment of a qualified
disadvantaged individual who voluntarily fails to return to the
seasonal employment of the qualified taxpayer.
   (ii) A failure to continue the seasonal employment of a qualified
disadvantaged individual who, before the close of the period referred
to in subparagraph (B) of paragraph (1), becomes disabled and unable
to perform the services of that seasonal employment, unless that
disability is removed before the close of that period and the
qualified taxpayer fails to offer seasonal employment to that
qualified disadvantaged individual.
   (iii) A failure to continue the seasonal employment of a qualified
disadvantaged individual, if it is determined that the failure to
continue the seasonal employment was due to the misconduct (as
defined in Sections 1256-30 to 1256-43, inclusive, of Title 22 of the
California Code of Regulations) of that qualified disadvantaged
individual.
   (iv) A failure to continue seasonal employment of a qualified
disadvantaged individual due to a substantial reduction in the
regular seasonal trade or business operations of the qualified
taxpayer.
   (v) A failure to continue the seasonal employment of a qualified
disadvantaged individual, if that qualified disadvantaged individual
is replaced by other qualified disadvantaged individuals so as to
create a net increase in both the number of seasonal employees and
the hours of seasonal employment.
   (C) For purposes of paragraph (1), the employment relationship
between the qualified taxpayer and a qualified disadvantaged
individual shall not be treated as terminated by either of the
following:
   (i) By a transaction to which Section 381(a) of the Internal
Revenue Code applies, if the qualified disadvantaged individual
continues to be employed by the acquiring corporation.
   (ii) By reason of a mere change in the form of conducting the
trade or business of the qualified taxpayer, if the qualified
disadvantaged individual continues to be employed in that trade or
business and the qualified taxpayer retains a substantial interest in
that trade or business.
   (3) Any increase in tax under paragraph (1) shall not be treated
as tax imposed by this part for purposes of determining the amount of
any credit allowable under this part.
                 (e) The credit shall be reduced by the credit
allowed under Section 23621.  The credit shall also be reduced by the
federal credit allowed under Section 51 of the Internal Revenue
Code.
   In addition, any deduction otherwise allowed under this part for
the wages or salaries paid or incurred by the qualified taxpayer upon
which the credit is based shall be reduced by the amount of the
credit, prior to any reduction required by subdivision (f) or (g).
   (f) In the case where the credit otherwise allowed under this
section exceeds the "tax" for the taxable year, that portion of the
credit that exceeds the "tax" may be carried over and added to the
credit, if any, in succeeding years, until the credit is exhausted.
The credit shall be applied first to the earliest taxable years
possible.
   (g) (1) The amount of credit otherwise allowed under this section,
including prior year credit carryovers, that may reduce the "tax"
for the taxable year shall not exceed the amount of tax that would be
imposed on the qualified taxpayer's business income attributed to a
Manufacturing Enhancement Area determined as if that attributed
income represented all of the net income of the qualified taxpayer
subject to tax under this part.
   (2) Attributable income is that portion of the taxpayer's
California source business income that is apportioned to the
Manufacturing Enhancement Area.  For that purpose, the taxpayer's
business income attributable to sources in this state first shall be
determined in accordance with Chapter 17 (commencing with Section
25101).  That business income shall be further apportioned to the
Manufacturing Enhancement Area in accordance with Article 2
(commencing with Section 25120) of Chapter 17, modified for purposes
of this section in accordance with paragraph (3).
   (3) Income shall be apportioned to a Manufacturing Enhancement
Area by multiplying the total California business income of the
taxpayer by a fraction, the numerator of which is the property factor
plus the payroll factor, and the denominator of which is two.  For
the purposes of this paragraph:
   (A) The property factor is a fraction, the numerator of which is
the average value of the taxpayer's real and tangible personal
property owned or rented and used in the Manufacturing Enhancement
Area during the taxable year, and the denominator of which is the
average value of all the taxpayer's real and tangible personal
property owned or rented and used in this state during the taxable
year.
   (B) The payroll factor is a fraction, the numerator of which is
the total amount paid by the taxpayer in the Manufacturing
Enhancement Area during the taxable year for compensation, and the
denominator of which is the total compensation paid by the taxpayer
in this state during the taxable year.
   (4) The portion of any credit remaining, if any, after application
of this subdivision, shall be carried over to succeeding taxable
years, as if it were an amount exceeding the "tax" for the taxable
year, as provided in this subdivision.
   (h) If the taxpayer is allowed a credit pursuant to this section
for qualified wages paid or incurred, only one credit shall be
allowed to the taxpayer under this part with respect to any wage
consisting in whole or in part of those qualified wages.
  SEC. 184.  Section 23646 of the Revenue and Taxation Code is
amended to read:
   23646.  (a) For each taxable year beginning on or after January 1,
1995, there shall be allowed as a credit against the "tax" (as
defined in Section 23036) to a qualified taxpayer for hiring a
qualified disadvantaged individual or a qualified displaced employee
during the taxable year for employment in the LAMBRA.  The credit
shall be equal to the sum of each of the following:
   (1) Fifty percent of the qualified wages in the first year of
employment.
   (2) Forty percent of the qualified wages in the second year of
employment.
   (3) Thirty percent of the qualified wages in the third year of
employment.
   (4) Twenty percent of the qualified wages in the fourth year of
employment.
   (5) Ten percent of the qualified wages in the fifth year of
employment.
   (b) For purposes of this section:
   (1) "Qualified wages" means:
   (A) That portion of wages paid or incurred by the employer during
the taxable year to qualified disadvantaged individuals or qualified
displaced employees that does not exceed 150 percent of the minimum
wage.
   (B) The total amount of qualified wages which may be taken into
account for purposes of claiming the credit allowed under this
section shall not exceed two million dollars ($2,000,000) per taxable
year.
   (C) Wages received during the 60-month period beginning with the
first day the individual commences employment with the taxpayer.
Reemployment in connection with any increase, including a regularly
occurring seasonal increase, in the trade or business operation of
the qualified taxpayer does not constitute commencement of employment
for purposes of this section.
   (D) Qualified wages do not include any wages paid or incurred by
the qualified taxpayer on or after the LAMBRA expiration date.
However, wages paid or incurred with respect to qualified
disadvantaged individuals or qualified displaced employees who are
employed by the qualified taxpayer within the LAMBRA within the
60-month period prior to the LAMBRA expiration date shall continue to
qualify for the credit under this section after the LAMBRA
expiration date, in accordance with all provisions of this section
applied as if the LAMBRA designation were still in existence and
binding.
   (2) "Minimum wage" means the wage established by the Industrial
Welfare Commission as provided for in Chapter 1 (commencing with
Section 1171) of Part 4 of Division 2 of the Labor Code.
   (3) "LAMBRA" means a local agency military base recovery area
designated in accordance with the provisions of Section 7114 of the
Government Code.
   (4) "Qualified disadvantaged individual" means an individual who
satisfies all of the following requirements:
   (A) (i) At least 90 percent of whose services for the taxpayer
during the taxable year are directly related to the conduct of the
taxpayer's trade or business located in a LAMBRA.
   (ii) Who performs at least 50 percent of his or her services for
the taxpayer during the taxable year in the LAMBRA.
   (B) Who is hired by the employer after the designation of the area
as a LAMBRA in which the individual's services were primarily
performed.
   (C) Who is any of the following immediately preceding the
individual's commencement of employment with the taxpayer:
   (i) An individual who has been determined eligible for services
under the federal Job Training Partnership Act (former 29 U.S.C. Sec.
1501 et seq.).
   (ii) Any voluntary or mandatory registrant under the Greater
Avenues for Independence Act of 1985 provided for pursuant to Article
3.2 (commencing with Section 11320) of Chapter 2 of Part 3 of
Division 9 of the Welfare and Institutions Code.
   (iii) An economically disadvantaged individual age 16 years or
older.
   (iv) A dislocated worker who meets any of the following
conditions:
   (I) Has been terminated or laid off or who has received a notice
of termination or layoff from employment, is eligible for or has
exhausted entitlement to unemployment insurance benefits, and is
unlikely to return to his or her previous industry or occupation.
   (II) Has been terminated or has received a notice of termination
of employment as a result of any permanent closure or any substantial
layoff at a plant, facility, or enterprise, including an individual
who has not received written notification but whose employer has made
a public announcement of such a closure or layoff.
   (III) Is long-term unemployed and has limited opportunities for
employment or reemployment in the same or a similar occupation in the
area in which the individual resides, including an individual 55
years of age or older who may have substantial barriers to employment
by reason of age.
   (IV) Was self-employed (including farmers and ranchers) and is
unemployed as a result of general economic conditions in the
community in which he or she resides or because of natural disasters.

   (V) Was a civilian employee of the Department of Defense employed
at a military installation being closed or realigned under the
Defense Base Closure and Realignment Act of 1990.
   (VI) Was an active member of the Armed Forces or National Guard as
of September 30, 1990, and was either involuntarily separated or
separated pursuant to a special benefits program.
   (VII) Experiences chronic seasonal unemployment and
underemployment in the agriculture industry, aggravated by continual
advancements in technology and mechanization.
   (VIII) Has been terminated or laid off or has received a notice of
termination or layoff as a consequence of compliance with the Clean
Air Act.
   (v) An individual who is enrolled in or has completed a state
rehabilitation plan or is a service-connected disabled veteran,
veteran of the Vietnam era, or veteran who is recently separated from
military service.
   (vi) An ex-offender.  An individual shall be treated as convicted
if he or she was placed on probation by a state court without a
finding of guilt.
   (vii) A recipient of:
   (I) Federal Supplemental Security Income benefits.
   (II) Aid to Families with Dependent Children.
   (III) Food stamps.
   (IV) State and local general assistance.
   (viii) Is a member of a federally recognized Indian tribe, band,
or other group of Native American descent.
   (5) "Qualified taxpayer" means a corporation that conducts a trade
or business within a LAMBRA and, for the first two taxable years,
has a net increase in jobs (defined as 2,000 paid hours per employee
per year) of one or more employees as determined below in the LAMBRA.

   (A) The net increase in the number of jobs shall be determined by
subtracting the total number of full-time employees (defined as 2,000
paid hours per employee per year) the taxpayer employed in this
state in the taxable year prior to commencing business operations in
the LAMBRA from the total number of full-time employees the taxpayer
employed in this state during the second taxable year after
commencing business operations in the LAMBRA.  For taxpayers who
commence doing business in this state with their LAMBRA business
operation, the number of employees for the taxable year prior to
commencing business operations in the LAMBRA shall be zero.  If the
taxpayer has a net increase in jobs in the state, the credit shall be
allowed only if one or more full-time employees is employed within
the LAMBRA.
   (B) The total number of employees employed in the LAMBRA shall
equal the sum of both of the following:
   (i) The total number of hours worked in the LAMBRA for the
taxpayer by employees (not to exceed 2,000 hours per employee) who
are paid an hourly wage divided by 2,000.
   (ii) The total number of months worked in the LAMBRA for the
taxpayer by employees who are salaried employees divided by 12.
   (C) In the case of a qualified taxpayer that first commences doing
business in the LAMBRA during the taxable year, for purposes of
clauses (i) and (ii), respectively, of subparagraph (B) the divisors
"2,000" and "12" shall be multiplied by a fraction, the numerator of
which is the number of months of the taxable year that the taxpayer
was doing business in the LAMBRA and the denominator of which is 12.

   (6) "Qualified displaced employee" means an individual who
satisfies all of the following requirements:
   (A) Any civilian or military employee of a base or former base
that has been displaced as a result of a federal base closure act.
   (B) (i) At least 90 percent of whose services for the taxpayer
during the taxable year are directly related to the conduct of the
taxpayer's trade or business located in a LAMBRA.
   (ii) Who performs at least 50 percent of his or her services for
the taxpayer during the taxable year in a LAMBRA.
   (C) Who is hired by the employer after the designation of the area
in which services were performed as a LAMBRA.
   (7) "Seasonal employment" means employment by a qualified taxpayer
that has regular and predictable substantial reductions in trade or
business operations.
   (8) "LAMBRA expiration date" means the date the LAMBRA designation
expires, is no longer binding, or becomes inoperative.
   (c) For qualified disadvantaged individuals or qualified displaced
employees hired on or after January 1, 2001, the taxpayer shall do
both of the following:
   (1) Obtain from either the Employment Development Department, as
permitted by federal law, the local county or city Job Training
Partnership Act administrative entity, the local county GAIN office,
or social services agency, as appropriate, a certification that
provides that a qualified disadvantaged individual or qualified
displaced employee meets the eligibility requirements specified in
subparagraph (C) of paragraph (4) of subdivision (b) or subparagraph
(A) of paragraph (6) of subdivision (b).  The Employment Development
Department may provide preliminary screening and referral to a
certifying agency.  The Employment Development Department shall
develop a form for this purpose.
   (2) Retain a copy of the certification and provide it upon request
to the Franchise Tax Board.
   (d) (1) For purposes of this section, both of the following apply:

   (A) All employees of all corporations that are members of the same
controlled group of corporations shall be treated as employed by a
single employer.
   (B) The credit (if any) allowable by this section to each member
shall be determined by reference to its proportionate share of the
qualified wages giving rise to the credit.
   (2) For purposes of this subdivision, "controlled group of
corporations" has the meaning given to that term by Section 1563(a)
of the Internal Revenue Code, except that both of the following
apply:
   (A) "More than 50 percent" shall be substituted for "at least 80
percent" each place it appears in Section 1563(a)(1) of the Internal
Revenue Code.
   (B) The determination shall be made without regard to Section 1563
(a)(4) and Section 1563(e)(3)(C) of the Internal Revenue Code.
   (3) If an employer acquires the major portion of a trade or
business of another employer (hereinafter in this paragraph referred
to as the "predecessor") or the major portion of a separate unit of a
trade or business of a predecessor, then, for purposes of applying
this section (other than subdivision (e)) for any calendar year
ending after that acquisition, the employment relationship between an
employee and an employer shall not be treated as terminated if the
employee continues to be employed in that trade or business.
   (e) (1) (A) If the employment of any employee, other than seasonal
employment, with respect to whom qualified wages are taken into
account under subdivision (a) is terminated by the taxpayer at any
time during the first 270 days of that employment (whether or not
consecutive) or before the close of the 270th calendar day after the
day in which that employee completes 90 days of employment with the
taxpayer, the tax imposed by this part for the taxable year in which
that employment is terminated shall be increased by an amount equal
to the credit allowed under subdivision (a) for that taxable year and
all prior taxable years attributable to qualified wages paid or
incurred with respect to that employee.
   (B) If the seasonal employment of any qualified disadvantaged
individual, with respect to whom qualified wages are taken into
account under subdivision (a) is not continued by the qualified
taxpayer for a period of 270 days of employment during the 60-month
period beginning with the day the qualified disadvantaged individual
commences seasonal employment with the qualified taxpayer, the tax
imposed by this part, for the taxable year that includes the 60th
month following the month in which the qualified disadvantaged
individual commences seasonal employment with the qualified taxpayer,
shall be increased by an amount equal to the credit allowed under
subdivision (a) for that taxable year and all prior taxable years
attributable to qualified wages paid or incurred with respect to that
qualified disadvantaged individual.
   (2) (A) Subparagraph (A) of paragraph (1) shall not apply to any
of the following:
   (i) A termination of employment of an employee who voluntarily
leaves the employment of the taxpayer.
   (ii) A termination of employment of an individual who, before the
close of the period referred to in paragraph (1), becomes disabled to
perform the services of that employment, unless that disability is
removed before the close of that period and the taxpayer fails to
offer reemployment to that individual.
   (iii) A termination of employment of an individual, if it is
determined that the termination was due to the misconduct (as defined
in Sections 1256-30 to 1256-43, inclusive, of Title 22 of the
California Code of Regulations) of that individual.
   (iv) A termination of employment of an individual due to a
substantial reduction in the trade or business operations of the
taxpayer.
   (v) A termination of employment of an individual, if that
individual is replaced by other qualified employees so as to create a
net increase in both the number of employees and the hours of
employment.
   (B) Subparagraph (B) of paragraph (1) shall not apply to any of
the following:
   (i) A failure to continue the seasonal employment of a qualified
disadvantaged individual who voluntarily fails to return to the
seasonal employment of the qualified taxpayer.
   (ii) A failure to continue the seasonal employment of a qualified
disadvantaged individual who, before the close of the period referred
to in subparagraph (B) of paragraph (1), becomes disabled and unable
to perform the services of that seasonal employment, unless that
disability is removed before the close of that period and the
qualified taxpayer fails to offer seasonal employment to that
qualified disadvantaged individual.
   (iii) A failure to continue the seasonal employment of a qualified
disadvantaged individual, if it is determined that the failure to
continue the seasonal employment was due to the misconduct (as
defined in Sections 1256-30 to 1256-43, inclusive, of Title 22 of the
California Code of Regulations) of that individual.
   (iv) A failure to continue seasonal employment of a qualified
disadvantaged individual due to a substantial reduction in the
regular seasonal trade or business operations of the qualified
taxpayer.
   (v) A failure to continue the seasonal employment of a qualified
disadvantaged individual, if that individual is replaced by other
qualified disadvantaged individuals so as to create a net increase in
both the number of seasonal employees and the hours of seasonal
employment.
   (C) For purposes of paragraph (1), the employment relationship
between the taxpayer and an employee shall not be treated as
terminated by either of the following:
   (i) A transaction to which Section 381(a) of the Internal Revenue
Code applies, if the employee continues to be employed by the
acquiring corporation.
   (ii) A mere change in the form of conducting the trade or business
of the taxpayer, if the employee continues to be employed in that
trade or business and the taxpayer retains a substantial interest in
that trade or business.
   (3) Any increase in tax under paragraph (1) shall not be treated
as tax imposed by this part for purposes of determining the amount of
any credit allowable under this part.
   (4) At the close of the second taxable year, if the taxpayer has
not increased the number of its employees as determined by paragraph
(5) of subdivision (b), then the amount of the credit previously
claimed shall be added to the taxpayer's tax for the taxpayer's
second taxable year.
   (f) In the case of an organization to which Section 593 of the
Internal Revenue Code applies, and a regulated investment company or
a real estate investment trust subject to taxation under this part,
rules similar to the rules provided in Section 46(e) and Section 46
(h) of the Internal Revenue Code shall apply.
   (g) The credit shall be reduced by the credit allowed under
Section 23621.  The credit shall also be reduced by the federal
credit allowed under Section 51 of the Internal Revenue Code.
   In addition, any deduction otherwise allowed under this part for
the wages or salaries paid or incurred by the taxpayer upon which the
credit is based shall be reduced by the amount of the credit, prior
to any reduction required by subdivision (h) or (i).
   (h) In the case where the credit otherwise allowed under this
section exceeds the "tax" for the taxable year, that portion of the
credit that exceeds the "tax" may be carried over and added to the
credit, if any, in succeeding years, until the credit is exhausted.
The credit shall be applied first to the earliest taxable years
possible.
   (i) (1) The amount of credit otherwise allowed under this section
and Section 23645, including any prior year carryovers, that may
reduce the "tax" for the taxable year shall not exceed the amount of
tax that would be imposed on the taxpayer's business income
attributed to a LAMBRA determined as if that attributed income
represented all of the income of the taxpayer subject to tax under
this part.
   (2) Attributable income shall be that portion of the taxpayer's
California source business income that is apportioned to the LAMBRA.
For that purpose, the taxpayer's business income that is
attributable to sources in this state first shall be determined in
accordance with Chapter 17 (commencing with Section 25101).  That
business income shall be further apportioned to the LAMBRA in
accordance with Article 2 (commencing with Section 25120) of Chapter
17, modified for purposes of this section in accordance with
paragraph (3).
   (3) Income shall be apportioned to a LAMBRA by multiplying the
total California business income of the taxpayer by a fraction, the
numerator of which is the property factor plus the payroll factor,
and the denominator of which is two.  For purposes of this paragraph:

   (A) The property factor is a fraction, the numerator of which is
the average value of the taxpayer's real and tangible personal
property owned or rented and used in the LAMBRA during the taxable
year, and the denominator of which is the average value of all the
taxpayer's real and tangible personal property owned or rented and
used in this state during the taxable year.
   (B) The payroll factor is a fraction, the numerator of which is
the total amount paid by the taxpayer in the LAMBRA during the
taxable year for compensation, and the denominator of which is the
total compensation paid by the taxpayer in this state during the
taxable year.
   (4) The portion of any credit remaining, if any, after application
of this subdivision, shall be carried over to succeeding taxable
years, as if it were an amount exceeding the "tax" for the taxable
year, as provided in subdivision (h).
   (j) If the taxpayer is allowed a credit pursuant to this section
for qualified wages paid or incurred, only one credit shall be
allowed to the taxpayer under this part with respect to any wage
consisting in whole or in part of those qualified wages.
  SEC. 185.  Section 44006 of the Revenue and Taxation Code is
amended to read:
   44006.  In order to facilitate the administration of this part and
in lieu of issuing an assessment for the fee, the board may
authorize the feepayer to file a return for a monthly, quarterly, or
other period set by the board.  The return shall identify each vessel
voyage and each port of call in California for which a ballast water
report is required to be filed with the State Lands Commission,
pursuant to Section 71205 of the Public Resources Code, during the
period covered by the return.  If the board authorizes the filing of
a return, the fees must be paid to the board by the end of the
calendar month following the end of the return reporting period.
  SEC. 186.  Section 45153 of the Revenue and Taxation Code is
amended to read:
   45153.  (a) Any person who fails to pay any fee to the state or
any amount of fee required to be paid to the state, except amounts of
determinations made by the board under Article 2 (commencing with
Section 45201), within the time required shall pay a penalty of 10
percent of the fee or amount of the fee in addition to the fee or
amount of the fee, plus interest at the modified adjusted rate per
month, or fraction thereof, established pursuant to Section 6591.5,
from the date on which the fee or the amount of the fee required to
be paid became due and payable to the state until the date of
payment.
   (b) Any person who fails to file a return in accordance with the
due date set forth in Section 45151, shall pay a penalty of 10
percent of the amount of the surcharge with respect to the period for
which the return is required.
   (c) The penalties imposed by this section shall be limited to a
maximum of 10 percent of the surcharge for which the return is
required for any one return.
  SEC. 187.  Section 1110 of the Unemployment Insurance Code is
amended to read:
   1110.  (a) Employer contributions required under Sections 976 and
976.6, the amount of benefits received by any individual pursuant to
this part that is deducted from an award or settlement made by the
employer under the provisions of Section 1382, and, except as
provided by subdivision (b) of this section, worker contributions
required under Section 984 are due and payable on the first day of
the calendar month following the close of each calendar quarter and
shall become delinquent if not paid on or before the last day of that
month.
   (b) Worker contributions required under Section 984 are due and
payable at the same time and by the same method as amounts required
to be withheld under Section 13020 are paid to the department
pursuant to Section 13021, regardless of the amount of accumulated
unpaid liability for worker contributions.
   (c) Employer contributions submitted pursuant to Section 976.5
shall be paid on or before the last working day of March of the
calendar year to which the reduced contribution rate would be
applicable.  Any employer whose eligibility for an unemployment
insurance contribution rate determination is redetermined to make
that employer eligible to submit voluntary unemployment insurance
contributions in accordance with Section 976.5, may submit a
voluntary unemployment insurance contribution within 30 days of the
date of notification of the redetermination.

       (d) Except as provided in subdivision (e), any employer
described in Sections 682 and 684 may elect to report and pay
employer contributions required under Sections 976 and 976.6, and
worker contributions required under Section 984, annually.  All
contributions are due and payable on the first day of January
following the close of the prior calendar year and shall become
delinquent if not paid on or before the last day of that month.  An
election under this subdivision shall be effective the first day of
the calendar year in which it is approved by the department.  An
election under this subdivision may not be approved if the employer
has an outstanding return or report delinquency on the records of the
department, or an unpaid amount owed to the department, that is not
the subject of a timely petition for reassessment pending before the
appeals board at the time the election is filed.
   (e) Any employer described in Sections 682 and 684 who pays more
than twenty thousand dollars ($20,000) in wages annually, shall not
be entitled to the election allowed in subdivision (d).  If at any
time during the year the total wages paid by an employer electing to
file under subdivision (d) exceeds twenty thousand dollars ($20,000),
the election shall be terminated at the close of that calendar
quarter.  In addition to the report of wages due for that quarter,
the employer shall file a return and pay any contributions due for
that portion of the year during which the election was in effect, and
shall pay contributions in accordance with subdivisions (a), (b),
and (c) for the remainder of that year.
   (f) Contributions due pursuant to this section may be submitted by
electronic funds transfer, as defined in Section 13021.5.
Contributions submitted by electronic funds transfer shall be deemed
complete in accordance with paragraph (4) of subdivision (e) of
Section 13021.
  SEC. 188.  Section 4000.37 of the Vehicle Code is amended to read:

   4000.37.  (a) Upon application for renewal of registration of a
motor vehicle, the department shall require that the applicant submit
either a form approved by the department, but issued by the insurer,
as specified in paragraph (1), (2), or (3), or any of the items
specified in paragraph (4), as evidence that the applicant is in
compliance with the financial responsibility laws of this state.
   (1) For vehicles covered by private passenger automobile liability
policies and having coverage as described in subdivisions (a) and
(b) of Section 660 of the Insurance Code, or policies and coverages
for private passenger automobile policies as described in
subdivisions (a) and (b) of that section and issued by an automobile
assigned risk plan, the form shall include all of the following:
   (A) The primary name of the insured covered by the policy or the
vehicle owner, or both.
   (B) The year, make, and vehicle identification number of the
vehicle.
   (C) The name, the National Association of Insurance Commissioners
(NAIC) number, and the address of the insurance company or surety
company providing a policy or bond for the vehicle.
   (D) The policy or bond number, and the effective date and
expiration date of that policy or bond.
   (E) A statement from the insurance company or surety company that
the policy or bond meets the requirements of Section 16056 or
16500.5.  For the purposes of this section, policies described in
Sections 11629.71 and 11629.91 of the Insurance Code are deemed to
meet the requirements of Section 16056.
   (2) For vehicles covered by commercial or fleet policies, and not
private passenger automobile liability policies, as described in
paragraph (1), the form shall include all of the following:
   (A) The name and address of the vehicle owner or fleet operator.
   (B) The name, the NAIC number, and the address of the insurance
company or surety company providing a policy or bond for the vehicle.

   (C) The policy or bond number, and the effective date and
expiration date of the policy or bond.
   (D) A statement from the insurance company or surety company that
the policy or bond meets the requirements of Section 16056 or 16500.5
and is a commercial or fleet policy.  For vehicles registered
pursuant to Article 9.5 (commencing with Section 5301) or Article 4
(commencing with Section 8050) of Chapter 4, one form may be
submitted per fleet as specified by the department.
   (3) (A) The director may authorize an insurer to issue a form that
does not conform to paragraph (1) or (2) if the director does all of
the following:
   (i) Determines that the entity issuing the alternate form is or
will begin reporting the insurance information required under
paragraph (1) or (2) to the department through electronic
transmission.
   (ii) Determines that use of the alternate form furthers the
interests of the state by enhancing the enforcement of the state's
financial responsibility laws.
   (iii) Approves the contents of the alternate form as providing an
adequate means for persons to prove compliance with the financial
responsibility laws.
   (B) The director may authorize the use of the alternate form in
lieu of the forms otherwise required under paragraph (1) or (2) for a
period of four years or less and may renew that authority for
additional periods of four years or less.
   (4) In lieu of evidence of insurance as described in paragraphs
(1), (2), and (3), one of the following documents as evidence of
coverage under an alternative form of financial responsibility may be
provided by the applicant:
   (A) An evidence form, as specified by the department, that
indicates either a certificate of self-insurance or an assignment of
deposit letter has been issued by the department pursuant to Sections
16053 or 16054.2.
   (B) An insurance covering note or binder pursuant to Section 382
or 382.5 of the Insurance Code.
   (C) An evidence form that indicates coverage is provided by a
charitable risk pool operating under Section 5005.1 of the
Corporations Code, if the registered owner of the vehicle is a
nonprofit organization that is exempt from taxation under paragraph
(3) of subsection (c) of Section 501 of the United States Internal
Revenue Code.  The evidence form shall include:
   (i) The name and address of the vehicle owner or fleet operator.
   (ii) The name and address of the charitable risk pool providing
the policy for the vehicle.
   (iii) The policy number, and the effective date and expiration
date of the policy.
   (iv) A statement from the charitable risk pool that the policy
meets the requirements of subdivision (b) of Section 16054.2.
   (b) This section does not apply to any of the following:
   (1) A vehicle for which a certification has been filed pursuant to
Section 4604, until the vehicle is registered for operation upon the
highway.
   (2) A vehicle that is owned or leased by, or under the direction
of, the United States or any public entity that is included in
Section 811.2 of the Government Code.
   (3) A vehicle registration renewal application where there is a
change of registered owner.
   (4) A vehicle for which evidence of liability insurance
information has been electronically filed with the department.
  SEC. 189.  Section 1789.5 of the Welfare and Institutions Code is
amended to read:
   1789.5.  The Office of Criminal Justice Planning shall monitor and
evaluate the projects established under this article, and shall
report to the Legislature after the first and third year of the
program's operation the results of its evaluation.  In addition, each
project shall be responsible for evaluating the effectiveness of its
programs and services.
  SEC. 190.  Section 4098.1 of the Welfare and Institutions Code is
amended to read:
   4098.1.  This chapter shall be known and may be cited as the
California Suicide Prevention Act of 2000.
  SEC. 191.  Section 5614 of the Welfare and Institutions Code is
amended to read:
   5614.  (a) The department, in consultation with the Compliance
Advisory Committee that shall have representatives from relevant
stakeholders, including, but not limited to, local mental health
departments, local mental health boards and commissions, private and
community-based providers, consumers and family members of consumers,
and advocates, shall establish a protocol for ensuring that local
mental health departments meet statutory and regulatory requirements
for the provision of publicly funded community mental health services
provided under this part.
   (b) The protocol shall include a procedure for review and
assurance of compliance for all of the following elements, and any
other elements required in law or regulation:
   (1) Financial maintenance of effort requirements provided for
under Section 17608.05.
   (2) Each local mental health board has approved procedures that
ensure citizen and professional involvement in the local mental
health planning process.
   (3) Children's services are funded pursuant to the requirements of
Sections 5704.5 and 5704.6.
   (4) The local mental health department complies with reporting
requirements developed by the department.
   (5) To the extent resources are available, the local mental health
department maintains the program principles and the array of
treatment options required under Sections 5600.2 to 5600.9,
inclusive.
   (6) The local mental health department meets the reporting
required by the performance outcome systems for adults and children.

   (c) The protocol developed pursuant to subdivision (a) shall focus
on law and regulations and shall include, but not be limited to, the
items specified in subdivision (b).  The protocol shall include data
collection procedures so that state review and reporting may occur.
The protocol shall also include a procedure for the provision of
technical assistance, and formal decision rules and procedures for
enforcement consequences when the requirements of law and regulations
are not met.  These standards and decision rules shall be
established through the consensual stakeholder process established by
the department.
  SEC. 192.  Section 8102 of the Welfare and Institutions Code is
amended to read:
   8102.  (a) Whenever a person, who has been detained or apprehended
for examination of his or her mental condition or who is a person
described in Section 8100 or 8103, is found to own, have in his or
her possession or under his or her control, any firearm whatsoever,
or any other deadly weapon, the firearm or other deadly weapon shall
be confiscated by any law enforcement agency or peace officer, who
shall retain custody of the firearm or other deadly weapon.
   "Deadly weapon," as used in this section, has the meaning
prescribed by Section 8100.
   (b) Upon confiscation of any firearm or other deadly weapon from a
person who has been detained or apprehended for examination of his
or her mental condition, the peace officer or law enforcement agency
shall notify the person of the procedure for the return of any
firearm or other deadly weapon which has been confiscated.
   Where the person is released, the professional person in charge of
the facility, or his or her designee, shall notify the person of the
procedure for the return of any firearm or other deadly weapon which
may have been confiscated.
   Health facility personnel shall notify the confiscating law
enforcement agency upon release of the detained person, and shall
make a notation to the effect that the facility provided the required
notice to the person regarding the procedure to obtain return of any
confiscated firearm.
   (c) Upon the release of a person as described in subdivision (b),
the confiscating law enforcement agency shall have 30 days to
initiate a petition in the superior court for a hearing to determine
whether the return of a firearm or other deadly weapon would be
likely to result in endangering the person or others, and to send a
notice advising the person of his or her right to a hearing on this
issue.  The law enforcement agency may make an ex parte application
stating good cause for an order extending the time to file a
petition.  Including any extension of time granted in response to an
ex parte request, a petition must be filed within 60 days of the
release of the person from a health facility.
   (d) If the law enforcement agency does not initiate proceedings
within the 30-day period, or the period of time authorized by the
court in an ex parte order issued pursuant to subdivision (c), it
shall make the weapon available for return.
   (e) The law enforcement agency shall inform the person that he or
she has 30 days to respond to the court clerk to confirm his or her
desire for a hearing, and that the failure to respond will result in
a default order forfeiting the confiscated firearm or weapon.  For
the purpose of this subdivision, the person's last known address
shall be the address provided to the law enforcement officer by the
person at the time of the person's detention or apprehension.
   (f)  If the person responds and requests a hearing, the court
clerk shall set a hearing, no later than 30 days from receipt of the
request.  The court clerk shall notify the person and the district
attorney of the date, time, and place of the hearing.
   (g)  If the person does not respond within 30 days of the notice,
the law enforcement agency may file a petition for order of default.

  SEC. 193.  Section 10082 of the Welfare and Institutions Code is
amended to read:
   10082.  (a) The department, through the Franchise Tax Board as its
agent, shall be responsible for procuring, in accordance with
Section 10083, developing, implementing, and maintaining the
operation of the California Child Support Automation System in all
California counties.  This project shall, to the extent feasible, use
the same sound project management practices that the Franchise Tax
Board has developed in successful tax automation efforts.  The single
statewide system shall be operative in all California counties and
shall also include the State Case Registry, the State Disbursement
Unit and all other necessary data bases and interfaces.  The system
shall provide for the sharing of all data and case files,
standardized functions across all of the counties, timely and
accurate payment processing and centralized payment disbursement from
a single location in the state.  The system may be built in phases
with payments contingent on acceptance of agreed upon deliverables.
As appropriate, additional payments may be made to the vendors for
predefined levels of higher performance once the system is in
operation.
   (b) All ongoing interim automation activities apart from the
procurement, development, implementation, and maintenance of the
California Child Support Automation System, including Year 2000
remediation efforts and system conversions, shall remain with the
department, and shall not be the responsibility of the Franchise Tax
Board.  However, the department shall ensure that all interim
automation activities are consistent with the procurement,
development, implementation, and maintenance of the California Child
Support Automation System by the Franchise Tax Board through the
project charter described in Section 10083 and through continuous
consultation.
   (c) The department shall seek, at the earliest possible date, all
federal approvals and waivers necessary to secure financial
participation and system design approval of the California Child
Support Automation System.
   (d) The department shall seek federal funding for the maintenance
and operation of all county child support automation systems until
the time that the counties transition to the California Child Support
Automation System.
   (e) The department shall direct local child support agencies, if
it determines it is necessary, to modify their current automation
systems or change to a different system, in order to meet the goal of
statewide automation.
   (f) Notwithstanding any state policies, procedures, or guidelines,
including those set forth in state manuals, all state agencies shall
cooperate with the Franchise Tax Board to expedite the procurement,
development, implementation, and operation of the California Child
Support Automation System and shall delegate to the Franchise Tax
Board, to the fullest extent possible, all functions including
acquisition authority as provided in Section 12102 of the Public
Contract Code, that may assist the Franchise Tax Board.  All state
agencies shall give review processes affecting the single statewide
automation system their highest priority and expedite these review
processes.
   (g) The Franchise Tax Board shall employ the expertise needed for
the successful and efficient implementation of the single statewide
child support automation system and, therefore, shall be provided
three Career Executive Assignment Level 2 positions, and may enter
into personal services agreements with one or more persons, at the
prevailing market rates for the kind or quality of services
furnished, provided the agreements do not cause the net displacement
of civil service employees.
   (h) All funds appropriated to the Franchise Tax Board for purposes
of this chapter shall be used in a manner consistent with the
authorized budget without any other limitations.
   (i) The department and the Franchise Tax Board shall consult with
local child support agencies and child support advocates on the
implementation of the single statewide child support automation
system.
   (j) (1) Notwithstanding the provisions of the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code), through December
31, 2000, the department may implement the applicable provisions of
this chapter through family support division letters or similar
instructions from the director.
   (2) The department may adopt regulations to implement this chapter
in accordance with the Administrative Procedure Act, Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code.  The adoption of any emergency regulation filed
with the Office of Administrative Law on or before January 1, 2003,
shall be deemed to be an emergency and necessary for the immediate
preservation of the public peace, health, and safety or general
welfare.  These emergency regulations shall remain in effect for no
more than 180 days.
  SEC. 194.  Section 14005.28 of the Welfare and Institutions Code is
amended to read:
   14005.28.  (a) To the extent federal financial participation is
available pursuant to an approved state plan amendment, the
department shall exercise its option under Section 1902(a)(10)(A)(XV)
of the federal Social Security Act (42 U.S.C. Sec.  1396a(a)(10)(A)
(XV)) to extend Medi-Cal benefits to independent foster care
adolescents, as defined in Section 1905(v)(1) of the federal Social
Security Act (42 U.S.C. Sec. 1396d(v)(1)).
   (b) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, and if the
state plan amendment described in subdivision (a) is approved by the
federal Health Care Financing Administration, the department may
implement subdivision (a) without taking any regulatory action and by
means of all-county letters or similar instructions.  Thereafter,
the department shall adopt regulations in accordance with the
requirements of Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code.
   (c) The department shall implement subdivision (a) on October 1,
2000, but only if, and to the extent that, the department has
obtained all necessary federal approvals.
  SEC. 195.  Section 14005.35 of the Welfare and Institutions Code is
amended to read:
   14005.35.  The department, in consultation with the counties and
representatives of consumers, managed care plans, and Medi-Cal
providers, shall study the feasibility of adopting a mechanism
whereby, to the extent federal financial participation is available,
a Medi-Cal managed care plan shall be notified whenever the
eligibility of a Medi-Cal beneficiary enrolled in that plan is being
redetermined, including notice of the date upon which any forms must
be submitted to the county by the beneficiary.
  SEC. 196.  Section 14008.6 of the Welfare and Institutions Code is
amended to read:
   14008.6.  (a) As a condition of eligibility for medical services
provided under this chapter or Chapter 8 (commencing with Section
14200), each applicant or beneficiary shall do all of the following:

   (1) Assign to the state any rights to medical support and to
payments for medical care from a third party that an individual may
have on his or her own behalf or on behalf of any other family member
for whom that individual has the legal authority to assign those
rights, and is applying for or receiving medical services.  Receipt
of medical services under this chapter or Chapter 8 (commencing with
Section 14200) shall operate as an assignment by operation of law.
If those rights are assigned pursuant to this subdivision, the
assignee may become an assignee of record by the local child support
agency or other public official filing with the court clerk an
affidavit showing that an assignment has been made or that there has
been an assignment by operation of law.  This procedure does not
limit any other means by which the assignee may become an assignee of
record.
   (2) Cooperate, as defined by subdivision (b) of Section 11477,
with the local child support agency in establishing the paternity of
a child born out of wedlock with respect to whom medical services are
requested or claimed, and for whom that individual can legally
assign the rights described in paragraph (1), and in obtaining any
medical support, as provided in Section 17400 of the Family Code, and
payments, as described in paragraph (1), due any person for whom
medical services are requested or obtained.
   (3) Cooperate with the state in identifying and providing
information to assist the state in pursuing any third party who may
be liable to pay for care and services available under the Medi-Cal
program.
   (b) The local child support agency shall verify that the applicant
or recipient refused to offer reasonable cooperation prior to
determining that the applicant or recipient is ineligible.  The
granting of medical services shall not be delayed or denied if the
applicant is otherwise eligible, if the applicant completes the
necessary forms and agrees to cooperate with the district attorney in
securing medical support and determining paternity, where
applicable.
   (c) An applicant or beneficiary shall be considered to be
cooperating with the local child support agency and shall be eligible
for medical services, if otherwise eligible, if the applicant or
beneficiary cooperates to the best of his or her ability or has good
cause for refusal to cooperate with the requirements in paragraphs
(2) and (3) of subdivision (a), as defined by Section 11477.04.  The
county welfare department shall make the determination of whether
good cause for refusal to cooperate exists.
   (d) The county welfare department and the local child support
agency shall ensure that all applicants for or beneficiaries of
medical services under this chapter or Chapter 8 (commencing with
Section 14200) are properly notified of the conditions imposed by
this section.
  SEC. 197.  Section 14087.32 of the Welfare and Institutions Code is
amended to read:
   14087.32.  Commencing on the date the authority first receives
Medi-Cal capitated payments for the provision of health care services
to Medi-Cal beneficiaries and until a commission established
pursuant to Section 14087.31 is in compliance with all the
requirements regarding tangible net equity applicable to a health
care service plan licensed under Chapter 2.2 (commencing with Section
1340) of Division 2 of the Health and Safety Code, all of the
following shall apply:
   (a) The commission may select and design its automated management
information system.  The department, in cooperation with the
commission, prior to making capitated payments, shall test the system
to ensure that the system is capable of producing detailed,
accurate, and timely financial information on the financial condition
of the commission, and any other information that is generally
required by the department in its contracts with other health care
service plans.
   (b) In addition to the reports required by the Department of
Managed Health Care under Chapter 2.2 (commencing with Section 1340)
of Division 2 of the Health and Safety Code, and the rules of the
Director of the Department of Managed Health Care promulgated
thereunder, a commission established pursuant to Section 14087.31
shall provide, on a monthly basis, to the department, the Department
of Managed Health Care, and the members of the commission, a copy of
the automated report described in subdivision (a) and a projection of
assets and liabilities, including those that have been incurred but
not reported, with an explanation of material increases or decreases
in current or projected assets or liabilities.  The explanation of
increases and decreases in assets or liabilities shall be provided,
upon request, to a hospital, independent physicians' practice
association or community clinic, which has contracted with the
authority to provide health care services.
   (c) In addition to the reporting and notification obligations the
commission has under Chapter 2.2 (commencing with Section 1340) of
Division 2 of the Health and Safety Code, the chief executive officer
or director of the commission shall immediately notify the
department, the Department of Managed Health Care, and the members of
the commission, in writing, of any fact or facts that, in the chief
executive officer's or director's reasonable and prudent judgment, is
likely to result in the commission being unable to meet its
financial obligations to health care providers or to other parties.
The written notice shall describe the fact or facts, the anticipated
fiscal consequences, and the actions which will be taken to address
the anticipated consequences.
   (d) The Department of Managed Health Care shall not, in any way,
waive or vary, nor shall the department request the Department of
Managed Health Care to waive or vary, the tangible net equity
requirements for a commission under Chapter 2.2 (commencing with
Section 1340) of Division 2 of the Health and Safety Code, after
three years from the date of commencement of capitated payments to
the commission.  Until the commission is in compliance with all of
the tangible net equity requirements under Chapter 2.2 (commencing
with Section 1340) of Division 2 of the Health and Safety
                                 Code, and the rules of the Director
of the Department of Managed Health Care adopted thereunder, the
commission shall develop a stop-loss program appropriate to the risks
of the commission, which program shall be satisfactory to both the
department and the Department of Managed Health Care.
   (e) (1)  If the commission votes to file a petition of bankruptcy,
or the county board of supervisors notifies the department of its
intent to terminate the commission, the department shall immediately
transfer the authority's Medi-Cal beneficiaries as follows:
   (A) To other managed care contractors, when available, provided
those contractors are able to demonstrate that they can absorb the
increased enrollment without detriment to the provision of health
care services to their existing enrollees.
   (B) To the extent that other managed care contractors are
unavailable or the department determines that it is otherwise in the
best interest of any particular beneficiary, to a fee-for-service
reimbursement system pending the availability of managed care
contractors provided those contractors are able to demonstrate that
they can absorb the increased enrollment without detriment to the
provision of health care services to their existing enrollees, or the
department determines that providing care to any particular
beneficiary pursuant to a fee-for-service reimbursement system is no
longer necessary to protect the continuity of care or other interests
of the beneficiary.
   (2) Beneficiary eligibility for Medi-Cal shall not be affected by
actions taken pursuant to paragraph (1).
   (3) Beneficiaries who have been or who are scheduled to be
transferred to a fee-for-service reimbursement system or managed care
contractor may make a choice to be enrolled in another managed care
system, if one is available, in full compliance with the federal
freedom-of-choice requirements.
   (f) (1) A commission established pursuant to Section 14087.31
shall submit to a review of financial records when the department
determines, based on data reported by the commission or otherwise,
that the commission will not be able to meet its financial
obligations to health care providers contracting with the commission.
  Where the review of financial records determines that the
commission will not be able to meet its financial obligations to
contracting health care providers for the provision of health care
services, the Director of Health Services shall immediately terminate
the contract between the commission and the state, and immediately
transfer the commission's Medi-Cal beneficiaries in accordance with
subdivision (e) in order to ensure uninterrupted provision of health
care services to the beneficiaries and to minimize financial
disruption to providers.
   (2) The action of the Director of Health Services pursuant to
paragraph (1) shall be the final administrative determination.
Beneficiary eligibility for Medi-Cal shall not be affected by this
action.
   (3) Beneficiaries who have been or who are scheduled to be
transferred under subdivision (e) may make a choice to be enrolled in
another managed care plan, if one is available, in full compliance
with federal freedom-of-choice requirements.
   (g) It is the intent of the Legislature that the department shall
implement Medi-Cal capitated enrollments in a manner that ensures
that appropriate levels of health care services will be provided to
Medi-Cal beneficiaries and that appropriate levels of administrative
services will be furnished to health care providers.  The contract
between the department and the commission shall authorize and permit
the department to administer the number of covered Medi-Cal
enrollments in such a manner that the commission's provider network
and administrative structure are able to provide appropriate and
timely services to beneficiaries and to participating providers.
   (h) In the event a commission is terminated, files for bankruptcy,
or otherwise no longer functions for the purpose for which it was
established, the county shall, with respect to compensation for
provision of health care services to beneficiaries, occupy no greater
or lesser status than any other health care provider in the
disbursement of assets of the commission.
   (i) Nothing in this section shall be construed to impair or
diminish the authority of the Director of the Department of Managed
Health Care under Chapter 2.2 (commencing with Section 1340) of
Division 2 of the Health and Safety Code, nor shall anything in the
section be construed to reduce or otherwise limit the obligation of a
commission licensed as a health care service plan to comply with the
requirements of Chapter 2.2 (commencing with Section 1340) of
Division 2 of the Health and Safety Code and the rules of the
Director of the Department of Managed Health Care adopted thereunder.

   (j) Except as expressly provided by other provisions of this
section, all exemptions and exclusions from disclosure as public
records pursuant to the Public Records Act (Chapter 3.5 (commencing
with Section 6250) of Division 7 of Title 1 of the Government Code),
including, but not limited to, those pertaining to trade secrets and
information withheld in the public interest, shall be fully
applicable for all state agencies and local agencies with respect to
all writings that the commission is required to prepare, produce, or
submit pursuant to this section.
  SEC. 198.  Section 14105.26 of the Welfare and Institutions Code is
amended to read:
   14105.26.  (a) Each eligible facility, as described in paragraph
(2) of subdivision (b), may, in addition to the rate of payment that
the facility would otherwise receive for skilled nursing services,
receive supplemental Medi-Cal reimbursement to the extent provided in
this section.
   (b) (1) Projects eligible for supplemental reimbursement shall
include any new capital projects for which final plans have been
submitted to the appropriate review agency after January 1, 2000, and
before January 1, 2003.  For purposes of this section, "capital
project" means the construction, expansion, replacement, remodeling,
or renovation of an eligible facility, including buildings and fixed
equipment.  A "capital project" does not include the provision of
furnishings or of equipment that is not fixed equipment.
   (2) A facility shall be eligible only if the submitting entity had
all of the following additional characteristics during the 1998
calendar year:
   (A) Provided services to Medi-Cal beneficiaries.
   (B) Was a distinct part of an acute care hospital providing
skilled nursing care and supportive care to patients whose primary
need is for the availability of skilled nursing care on an extended
basis.  For the purposes of this section, "acute care hospital" means
the facilities defined in subdivision (a) or (b), or both, of
Section 1250 of the Health and Safety Code.
   (C) Had not less than 300 licensed skilled nursing beds.
   (D) Had an average skilled nursing Medi-Cal patient census of not
less than 80 percent of the total skilled nursing patient days.
   (E) Was owned by a county or city and county.
   (c) (1) An eligible facility seeking to qualify for supplemental
reimbursement shall submit documentation to the department regarding
debt service on revenue bonds or other financing instruments used for
financing the capital project.
   (2) The department shall confirm in writing project eligibility
under this section.
   (d) (1) Capital projects receiving funding shall include only the
upgrading or construction of buildings and equipment to a level
required by currently accepted medical practice standards, including
projects designed to correct Joint Commission on Accreditation of
Hospitals and Health Systems, fire and life safety, seismic, or other
related regulatory standards.
   (2) Capital projects receiving funding may expand service capacity
as needed to maintain current or reasonably foreseeable necessary
bed capacity to meet the needs of Medi-Cal beneficiaries after giving
consideration to bed capacity needed for other patients, including
unsponsored patients.
   (3) Supplemental reimbursement shall only be made for capital
projects, or for that portion of capital projects that provide
skilled nursing services, and that are available and accessible to
patients eligible for services under this chapter.
   (e) An eligible facility's supplemental reimbursement for a
capital project qualifying pursuant to this section shall be
calculated and paid as follows:
   (1) For any fiscal year for which the facility is eligible to
receive supplemental reimbursement, the facility shall report to the
department the amount of debt service on the revenue bonds or other
financing instruments issued to finance the capital project.
   (2) For each fiscal year in which an eligible facility requests
reimbursement, the department shall establish the ratio of skilled
nursing Medi-Cal days of care provided by the eligible facility to
total skilled nursing patient days of care provided by the eligible
facility.  The ratio shall be established using data obtained from
audits performed by the department, and shall be applied to the
corresponding fiscal year of debt service on the revenue bonds or
other financing instruments issued to finance the capital project.
   (3) The amount of debt service that will be submitted to the
federal Health Care Financing Administration for the purpose of
claiming reimbursement for each fiscal year shall equal the amount
determined annually in paragraph (1) multiplied by the percentage
figure determined in paragraph (2).
   (4) The supplemental reimbursement to an eligible facility shall
be equal to the amount of federal financial participation received as
a result of the claims submitted pursuant to paragraph (2) of
subdivision (j).
   (5) In no instance shall the total amount of supplemental
reimbursement received under this section combined with that received
from all other sources dedicated exclusively to debt service exceed
100 percent of the debt service for the capital project over the life
of the loan, revenue bond, or other financing mechanism.
   (6) A facility qualifying for and receiving supplemental
reimbursement pursuant to this section shall continue to receive
reimbursement until the qualifying loan, revenue bond, or other
financing mechanism is paid off, and as long as the facility meets
the requirements of paragraph (3) of subdivision (d).
   (7) The supplemental Medi-Cal reimbursement provided by this
section shall be distributed under a payment methodology based on
skilled nursing services provided to Medi-Cal patients at the
eligible facility, either on a per diem basis, a per discharge basis,
or any other federally permissible basis.  The department shall seek
approval from the federal Health Care Financing Administration for
the payment methodology to be utilized, and shall not make any
payment pursuant to this section prior to obtaining that approval.
   (8) The supplemental reimbursement provided by this section shall
not commence prior to the date upon which the hospital submits to the
department a copy of the certificate of occupancy for the capital
project.
   (f) (1) It is the Legislature's intent in enacting this section to
provide a funding source for a portion of the construction costs of
eligible facilities without any expenditure from the state General
Fund.
   (2) The state share of the amount of the debt service submitted to
the federal Health Care Financing Administration for purposes of
supplemental reimbursement shall be paid with county-only funds and
certified to the state as provided in subdivision (g).  Any amount of
the costs of the capital project that are not reimbursed by federal
funds shall be borne solely by the eligible facility.
   (3) Prior to receiving any funding through this section, an
eligible facility shall demonstrate its ability to cover all of the
anticipated costs of construction, including those not reimbursed
through federal funding.
   (g) The county or city and county, on behalf of any eligible
facility, shall do all of the following:
   (1) Certify, in conformity with the requirements of Section 433.51
of Title 42 of the Code of Federal Regulations, that the claimed
expenditures for the capital project are eligible for federal
financial participation.
   (2) Provide evidence supporting the certification as specified by
the department.
   (3) Submit data, as specified by the department, to determine the
appropriate amounts to claim as expenditures qualifying for financial
participation.
   (4) Keep, maintain, and have readily retrievable, the records as
specified by the department in order to fully disclose reimbursement
amounts to which the eligible facility is entitled, and any other
records required by the federal Health Care Financing Administration.

   (h) The department may require that any county or city and county
seeking supplemental reimbursement under this section enter into an
interagency agreement with the department for the purpose of
implementing this section.
   (i) All payments received by an eligible facility pursuant to this
section shall be placed in a special account, the funds of which
shall be used exclusively for the payment of expenses related to the
eligible capital project.
   (j) (1) The department shall promptly seek any necessary federal
approvals for the implementation of this section.  If necessary to
obtain federal approval, the department may, for federal purposes,
limit the program to those costs that are allowable expenditures
under Title XIX of the federal Social Security Act (Subchapter 19
(commencing with Section 1396) of Chapter 7 of Title 42 of the United
States Code).  If federal approval is not obtained for
implementation of this section, this section shall become
inoperative.
   (2) The department shall submit claims for federal financial
participation for the expenditures for debt service that are
allowable expenditures under federal law.
   (3) The department shall, on an annual basis, submit any necessary
materials to the federal government to provide assurances that
claims for federal financial participation will include only those
expenditures that are allowable under federal law.
   (k) Supplemental reimbursement paid under this section shall not
duplicate any reimbursement received by an eligible facility pursuant
to this chapter for construction costs that would otherwise be
eligible for reimbursement under this section.  In no event shall the
total Medi-Cal reimbursement pursuant to this chapter to a facility
eligible under this section be less than what would have been paid
had this section not existed.
   (l) In the event there is a final judicial determination by any
court of appellate jurisdiction or a final determination by the
administrator of the federal Health Care Financing Administration
that the supplemental reimbursement provided in this section must be
made to any facility not described therein, this section shall become
immediately inoperative.
   (m) Any and all funds expended pursuant to this section shall be
subject to review and audit by the department.
  SEC. 199.  Section 511 of the San Gabriel Basin Water Quality
Authority Act (Chapter 776 of the Statutes of 1992) is amended to
read:
  Sec. 511.  (a) Except as otherwise provided, all actions of the
board shall be approved by an affirmative vote of a majority of all
of the members.
   (b) Notwithstanding subdivision (a), an affirmative vote of a
majority of all of the members shall include one city member, one
producer member, and one water district member to take any of the
following actions:
   (1) Adopt the authority's budget.
   (2) Pursue legal action pursuant to subdivision (c) of Section
407.
   (3) Impose an annual pumping right assessment pursuant to Section
605 or to continue an assessment pursuant to Section 614.
   (4) Make a determination pursuant to subdivision (a) or (d) of
Section 707.
  SEC. 200.  Section 1 of Chapter 352 of the Statutes of 2000 is
amended to read:
  Section 1.  (a) The Legislature finds and declares that it is
necessary for the Fair Political Practices Commission to periodically
review and improve the regulations that implement the Political
Reform Act of 1974.
   (b) It is the intent of the Legislature that, in order to prevent
an unnecessary chilling of participation in the governmental and
regulatory process by public officials of local government agencies,
the Fair Political Practices Commission, as part of its Conflict of
Interest Regulatory Improvement Project of 1999-2000, shall adopt
regulations with respect to those officials that would accomplish all
of the following:
   (1) Minimize the instances of disqualification regarding
governmental decisions that do not directly and materially affect an
official's economic interest where it is reasonably foreseeable that
the economic impact of the decision will be distributed over a broad
segment of the official's jurisdiction.
   (2) Clarify that the fact that holding a professional license does
not of itself give rise to a disqualifying conflict of interest.
   (3) Clarify that one, or more than one, industry, trade, or
profession is not necessarily prohibited from constituting a
significant segment of the public for purposes of analyzing whether
the public official of a local government agency is affected by a
decision in the same or similar manner as the "public generally."
  SEC. 201.  Section 1 of Chapter 661 of the Statutes of 2000 is
amended to read:
  Section 1.  (a) It is the intent of the Legislature in enacting
this act to enable the Redevelopment Agency of the City and County of
San Francisco to redress the demolition of a substantial number of
residential dwelling units affordable to very low, low-, and
moderate-income households during the agency's earlier urban renewal
efforts.  San Francisco's housing situation is unique, in that median
rents and sales prices are among the highest in the state even
though it has consistently exceeded the housing production goals of
the Community Redevelopment Law and has used local funds beyond the
Low and Moderate Income Housing Fund to assist affordable housing
development.  San Francisco's early redevelopment activities,
including the removal of previously existing dwelling units serving a
lower income population, have compounded the effects of the private
market that have led to the city's current affordable housing crisis.

   (b) The Legislature finds and declares that prior to the enactment
of the replacement housing obligations in Section 33413 of the
Health and Safety Code (Chapter 970, Statutes of 1975), agencies
destroyed or removed dwelling units housing persons and families of
low or moderate income without replacing those units.  In particular,
some of San Francisco's existing redevelopment project areas have
fewer housing units affordable to low- and moderate-income households
than were in existence prior to the initiation of urban renewal
activities.  Four of San Francisco's project areas adopted prior to
1970 experienced a combined net loss of approximately 7,000 units of
housing affordable to low- and moderate-income households since the
initiation of redevelopment activities.  The Redevelopment Agency of
the City and County of San Francisco, due to its unique housing
situation and net loss of affordable housing units in these project
areas, wishes, to the greatest extent feasible, to replace these lost
units according to the formulas set forth in Section 33413 of the
Health and Safety Code.
   (c) The Legislature further finds and declares that allowing the
Redevelopment Agency of the City and County of San Francisco to
replace units destroyed or removed prior to the enactment of the
replacement housing obligations in 1975 is consistent with a
fundamental purpose of the Community Redevelopment Law identified in
subdivision (a) of Section 33334.6 of the Health and Safety Code,
namely the provision of affordable housing.
   (d) The Legislature further finds and declares that the time
limits for incurring indebtedness in Section 33333.6 of the Health
and Safety Code impede the efforts of the Redevelopment Agency of the
City and County of San Francisco to replace affordable housing units
destroyed or removed prior to the enactment of the replacement
housing obligations in 1975.
   (e) The Legislature further finds and declares that the
Redevelopment Agency of the City and County of San Francisco should
be granted a limited continuance of specific tax increment financing
powers to achieve its goal of replacing housing units, and that this
continuance will have no fiscal impact on the state.
   (f) This limited continuance in no way affords the Redevelopment
Agency of the City and County of San Francisco an extension of any of
its powers, above and beyond tax increment financing and the
collection of tax increment to repay indebtedness exclusively to
support Low and Moderate Income Housing Fund activities, nor does it
signify the extension or expansion of the redevelopment plans or
activities to which paragraph (1) of subdivision (a) of Section
33333.6 of the Health and Safety Code applies.
  SEC. 202.  Section 2 of Chapter 693 of the Statutes of 2000 is
amended to read:
  Sec. 2.  Section 1.5 of this bill incorporates amendments to
Section 69.5 of the Revenue and Taxation Code proposed by both this
bill and SB 1417.  It shall only become operative if (1) both bills
are enacted and become effective on or before January 1, 2001, but
this bill becomes operative first, (2) each bill amends Section 69.5
of the Revenue and Taxation Code, and (3) this bill is enacted after
SB 1417, in which case Section 69.5 of the Revenue and Taxation Code,
as amended by Section 1 of this bill, shall remain operative only
until the operative date of SB 1417, at which time Section 1.5 of
this bill shall become operative.
  SEC. 203.  Section 5 of the Naval Training Center San Diego Public
Trust Exchange Act (Chapter 714 of the Statutes of 2000) is amended
to read:
  Sec. 5.  (a) The Legislature hereby approves an exchange of public
trust lands within the NTC Property, whereby certain public trust
lands that are not now useful for public trust purposes are freed of
the public trust and certain other lands that are not now public
trust lands, or are subject to uncertainty as to their trust status,
and that are useful for public trust purposes are made subject to the
public trust, resulting in a configuration of trust lands that is
substantially similar to that shown on the diagram in Section 9,
provided the exchange complies with the requirements of this act.
The exchange is consistent with and furthers the purposes of the
public trust and the city granting act and the port granting act.
   (b) The commission is authorized to carry out an exchange of
public trust lands within the NTC Property, in accordance with the
requirements of this act.  Pursuant to this authority, the commission
shall establish appropriate procedures for effectuating the
exchange.  The procedures shall include procedures for ensuring that
lands are not exchanged into the trust until any necessary hazardous
material remediation for those lands has been completed, and may
include, if appropriate, procedures for completing the exchange in
phases.
   (c) The precise boundaries of the lands to be taken out of the
trust and the lands to be put into the trust pursuant to the exchange
shall be determined by the commission.  The commission shall not
approve the exchange of any trust lands unless and until all of the
following occur:
   (1) The commission finds that the configuration of trust lands on
the NTC Property upon completion of the exchange will not differ
significantly from the configuration shown on the diagram in Section
9, and includes all lands presently subject to tidal action within
the NTC Property.
   (2) The commission finds that, with respect to the trust exchange
as finally configured, the economic value of the lands that are to be
exchanged into the trust, as phased, is equal to or greater than the
value of the lands to be exchanged out of the trust.  The commission
may give economic value to the port expansion area confirmed as
public trust lands as provided in subdivision (h).
   (3) The commission finds that, with respect to the trust exchange
as finally configured and phased, the lands to be taken out of the
trust have been filled and reclaimed, are cut off from access to
navigable waters, are no longer needed or required for the promotion
of the public trust, and constitute a relatively small portion of the
lands originally granted to the city, and that the exchange will not
result in substantial interference with trust uses and purposes.
   (4) The exchange is approved by the entity or entities that, under
the provisions of the city granting act, the port granting act, and
this act, would be responsible for administering the public trust
with respect to the lands to be exchanged into the trust, and any
such lands will be accepted by that entity or those entities subject
to the public trust and the requirements of the city granting act or
port granting act, as applicable.
   (d) The exchange authorized by this act is subject to any
additional conditions that the commission determines are necessary
for the protection of the public trust.  At a minimum, the commission
shall establish conditions to ensure both of the following:
   (1) Streets and other transportation facilities located on trust
lands are designed to be compatible with the public trust.
   (2) Lands are not exchanged, or confirmed, into the trust until
any necessary hazardous materials remediation for those lands has
been completed.
   (e) All former or existing tide or submerged lands within the NTC
Property for which the public trust has not been terminated pursuant
to the exchange authorized by this act, and any lands exchanged or
confirmed into the trust pursuant to this act, shall be held, whether
by the port or by the city, subject to the public trust and the
requirements of the city granting act as public trust lands within
the city NTC Property, or the port granting act, as to the land
within the port expansion area.  In addition, notwithstanding the
provisions of the city granting act, during any period in which lands
confirmed to the city as lands subject to the city granting act are
held by the Redevelopment Agency of the City of San Diego rather than
the city, the Redevelopment Agency shall be the public trust
administrator for the lands, and shall have the same powers and be
subject to the same requirements as would the city under the granting
act.
                     (f) Any lands exchanged out of the trust
pursuant to this act shall be deemed free of the public trust and the
requirements of the city granting act.
   (g) For purposes of effectuating the exchange authorized by this
act, the commission may do all of the following:
   (1) Receive and accept on behalf of the state any lands or
interest in lands conveyed to the state by the port or the city,
including lands that are now and that will remain subject to the
public trust.
   (2) Convey to the city or port by patent all of the right, title,
and interest of the state in lands that are to be free of the public
trust upon completion of an exchange of lands as authorized by this
act and as approved by the commission.
   (3) Convey to the city or port by patent all of the right, title,
and interest of the state in lands that are to be subject to the
public trust and the terms of this act and the granting act upon
completion of an exchange of lands as authorized by this act and as
approved by the commission, subject to the terms, conditions, and
reservations that the commission may determine are necessary to meet
the requirements of subdivisions (d) and (e).
   (h) To achieve the configuration of public trust lands shown in
the diagram in Section 9, the port, simultaneous with or following
its receipt of the port expansion area, shall confirm its title as
tide and submerged lands subject to the port granting act by
agreement with the commission.  The port and the commission may make
conveyances between themselves to establish the title to the port
expansion area as public trust lands subject to the port granting
act.
   (i) In any case where the state, pursuant to this act, conveys
filled tidelands and submerged lands transferred to the city pursuant
to Chapter 700 of the Statutes of 1911, as amended, the state shall
reserve all minerals and all mineral rights in the lands of every
kind and character now known to exist or hereafter discovered,
including, but not limited to, oil and gas and rights thereto,
together with the sole, exclusive, and perpetual right to explore
for, remove, and dispose of those minerals by any means or methods
suitable to the state or to its successors and assignees, except
that, notwithstanding Chapter 700 of the Statutes of 1911, as
amended, or Section 6401 of the Public Resources Code, the
reservations shall not include the right of the state or its
successors or assignees in connection with any mineral exploration,
removal, or disposal activity, to do either of the following:
   (1) Enter upon, use, or damage the surface of the lands or
interfere with the use of the surface by any grantee or by the
grantee's successor or assignees.
   (2) Conduct any mining activities of any nature whatsoever above a
plane located 500 feet below the surface of the lands without the
prior written permission of any grantee of the lands or the grantee's
successors or assigns.
  SEC. 204.  Section 6 of the Naval Training Center San Diego Public
Trust Exchange Act (Chapter 714 of the Statutes of 2000) is amended
to read:
  Sec. 6.  (a) Notwithstanding the provisions of the granting act,
the existing child care center  on trust lands within the NTC
Property, which was constructed for nontrust purposes during the
period of federal ownership and is incapable of being devoted to
public trust purposes, may be used for those nontrust purposes for
the remaining useful life of the building.  The city and the
commission, by agreement, shall establish the remaining useful life
of the child care center, provided that in no case shall the useful
life of the child care center be deemed to extend less than 15 years
or more than 40 years from the effective date of this act.
   (b) The maintenance, repair, or, in the event of a flood, fire, or
similar disaster, partial reconstruction of  the child care center,
and any structural or other alterations necessary to bring the child
care center into compliance with applicable federal, state, and local
health and safety standards, including, but not limited to, seismic
upgrading, shall be permitted, provided those activities will not
enlarge the footprint or the size of the shell of the child care
center.
  SEC. 205.  Section 228 of Chapter 862 of the Statutes of 2000 is
amended to read:
  Sec. 228.  (a) Except as provided in subdivision (b), any section
of any act enacted by the Legislature during the 2000 calendar year
that does both of the following shall prevail over this act, whether
that act is enacted prior to, or subsequent to, the enactment of this
act:
   (1) Takes effect on or before January 1, 2001.
   (2) Amends, amends and renumbers, adds, repeals and adds, or
repeals a section that is amended, amended and renumbered, added,
repealed and added, or repealed by this act.
   (b) This section shall not apply to Sections 23042, 23151,
23151.1, 23153, 23181, 23183, 23183.1, 23281, 23282, and 24631 of the
Revenue and Taxation Code, as amended by this act.
  SEC. 206.  Section 2 of Chapter 975 of the Statutes of 2000 is
amended to read:
  Sec. 2.  (a) The Bipartisan California Commission on Internet
Political Practices is hereby established.  The commission shall
consist of 13 members appointed as follows:
   (1) Three members appointed by the Governor, one of whom shall be
a member of the Democratic Party, and one of whom shall be a member
of the Republican Party.
   (2) Two members appointed by the Senate Committee on Rules.
   (3) One member appointed by the Minority Floor Leader of the
Senate.
   (4) Two members appointed by the Speaker of the Assembly.
   (5) One member appointed by the Minority Floor Leader of the
Assembly.
   (6) Two members appointed by the Secretary of State, one of whom
shall be a member of the Democratic Party, and one of whom shall be a
member of the Republican Party.
   (7) Two members appointed by the Chairperson of the Fair Political
Practices Commission, one of whom shall be a member of the
Democratic Party, and one of whom shall be a member of the Republican
Party.
   (b) Each appointing authority shall seek to appoint individuals
with diversified backgrounds and expertise to ensure that the
membership of the Bipartisan California Commission on Internet
Political Practices is familiar with, among other matters, all of the
following:
   (1) The magnitude of change posed by Internet technology.
   (2) Political campaign practices and trends.
   (3) Legal developments concerning political speech, the Internet,
and the act.
   (4) The concerns of public interest groups.
   (c) The Bipartisan California Commission on Internet Political
Practices shall meet and select a chairperson from among its members
not later than 45 days after the effective date of this act.  The
chairperson may hire a director, a secretary, and a legal adviser to
assist with the work of the commission.
   (d) The Bipartisan California Commission on Internet Political
Practices shall examine the various issues posed by campaign activity
on the Internet in relation to the goals and purposes of the act,
and make recommendations for appropriate legislative action, if any.
The examination of issues should include, but are not limited to,
the following:
   (1) Whether political communications on the Internet, especially
those that expressly advocate support for or opposition to clearly
identified candidates for elective office or ballot measures should
be subject to the campaign finance disclosure requirements of the
act.
   (2) Whether costs associated with the development of campaign Web
sites should be disclosed to the public, and whether they should be
treated, depending on the circumstances, as reportable contributions,
expenditures, independent expenditures, or payments.
   (3) Whether Web sites created by individuals, sometimes referred
to as "fan sites," that contain references to candidates and
measures, or urge support or opposition to candidates or measures, or
that provide hyperlinks to official campaign sites, should be
treated differently from sites created by political parties,
candidate and ballot measure committees, or independent committees.
   (4) Whether the identity of publishers of Web sites that feature
political campaign activity should be required to be disclosed
similar to current identification requirements for persons who pay
for printed or broadcast advertising.
   (5) Whether current laws are adequate to protect against fraud,
libel, or slander in the context of Internet political activity.
   (6) Whether any disclosure requirements should be imposed on
Internet political activity in order to encourage the broadest
possible citizen participation in the electoral process.
   (7) Whether the act is an appropriate regulatory vehicle for
campaign activity at the state level, or whether a different
regulatory structure for Internet campaign activity should be
developed, if any.
   (e) The meetings of the Bipartisan California Commission on
Internet Political Practices shall be open and public.  The
commission members shall receive one hundred dollars ($100) per diem
for each day of attendance at a meeting of the commission, not to
exceed 10 meetings.
   (f) The Bipartisan California Commission on Internet Political
Practices shall report its findings and recommendations to the
Legislature not later than December 1, 2001.  The commission shall
cease to exist on January 1, 2002.
  SEC. 207.  Section 3 of Chapter 975 of the Statutes of 2000 is
amended to read:
  Sec. 3.  The sum of two hundred twenty thousand dollars ($220,000)
is hereby appropriated from the General Fund to the Controller for
allocation to the Bipartisan California Commission on Internet
Political Practices to defray the costs of the commission in
conducting the study and preparing the report required by this act.

  SEC. 208.  Any section of any act enacted by the Legislature during
the 2001 calendar year that takes effect on or before January 1,
2002, and that amends, amends and renumbers, adds, repeals and adds,
or repeals a section that is amended, amended and renumbered, added,
repealed and added, or repealed by this act, shall prevail over this
act, whether that act is enacted prior to, or subsequent to, the
enactment of this act.  The repeal, or repeal and addition, of any
article, chapter, part, title, or division of any code by this act
shall not become operative if any section of any other act that is
enacted by the Legislature during the 2001 calendar year and takes
effect on or before January 1, 2002, amends, amends and renumbers,
adds, repeals and adds, or repeals any section contained in that
article, chapter, part, title, or division.