BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 306|
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UNFINISHED BUSINESS
Bill No: SB 306
Author: Ducheny (D)
Amended: 9/7/07
Vote: 21
SENATE HEALTH COMMITTEE : 10-0, 4/11/07
AYES: Kuehl, Aanestad, Alquist, Cedillo, Cox, Maldonado,
Ridley-Thomas, Steinberg, Wyland, Yee
NO VOTE RECORDED: Negrete McLeod
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SENATE FLOOR : 36-0, 5/24/07
AYES: Aanestad, Ackerman, Alquist, Ashburn, Calderon,
Cedillo, Cogdill, Corbett, Correa, Cox, Denham, Ducheny,
Dutton, Hollingsworth, Kehoe, Kuehl, Machado, Maldonado,
Margett, McClintock, Migden, Negrete McLeod, Oropeza,
Padilla, Perata, Ridley-Thomas, Romero, Runner, Scott,
Simitian, Steinberg, Torlakson, Vincent, Wiggins, Wyland,
Yee
NO VOTE RECORDED: Battin, Florez, Harman, Lowenthal
ASSEMBLY FLOOR : 70-2, 9/10/07 - See last page for vote
SUBJECT : Health facilities: seismic safety
SOURCE : Author
DIGEST : This bill amends the Alfred E. Alquist Hospital
Facilities Seismic Safety Act to permit hospitals to delay
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compliance with the July 1, 2008 seismic retro deadline,
and the 2013 extension, to the year 2020, by filing a
declaration with the Office of Statewide Health Planning
and Development that the owner lacks financial capacity to
comply with the law.
Assembly Amendments provide SPC-1 hospitals that
demonstrate an inability to attain financing for capital
projects, and that are essential providers in underserved
communities, with the option to rebuild to 2030 standards
by 2020, rather than meet the interim 2008/2013
retrofitting deadlines.
ANALYSIS :
Existing law:
1. Requires the Office of Statewide Health Planning and
Development (OSHPD) to approve or reject all plans for
the construction or the alteration of hospital
buildings, as defined, and to impose an application
filing fee that will cover the costs of reviewing and
approving hospital construction plans.
2. Requires OSHPD to adopt regulations and standards to
administer its responsibilities and to submit building
standards, relating to seismic safety for hospital
buildings, to the California Building Standards
Commission for adoption and approval, and also requires
OSHPD to inspect hospital buildings and construction or
alteration projects, as necessary, to ensure that such
buildings comply with applicable standards.
3. Establishes timelines for hospital compliance with
seismic safety standards. By January 1, 2008, buildings
posing a significant risk of collapse and a danger to
the public must be rebuilt or retrofitted to be capable
of withstanding an earthquake, or be removed from acute
care service. By January 1, 2030, hospital buildings
must be capable of remaining intact after an earthquake,
and must also be capable of continued operation and
provision of acute care medical services, or else be
changed to non-acute care use.
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4. Allows OSHPD to grant delays of up to five years past
the 2008 deadline under certain circumstances, including
upon a demonstration that compliance will result in a
loss of health care capacity that may not be provided by
other general acute care hospitals within a reasonable
proximity.
5. Authorizes an extension of up to an additional two years
for hospitals that have already received extensions of
the January 1, 2008 seismic safety compliance deadline,
if specified criteria are met, including that the
hospital building is under construction at the time of
the request for extension and the hospital is making
reasonable progress toward meeting its deadline, but
factors beyond the hospital's control make it impossible
for the hospital to meet the deadline.
6. Requires owners of general acute care hospital buildings
that do not meet the 2008 requirement to submit reports
to OSHPD describing their progress in complying with the
2008 or 2013 deadlines, as specified.
7. Requires the California Building Standards Commission to
review and adopt earthquake performance categories,
seismic evaluation procedures, and standards and
timeframes for upgrading structural and nonstructural
systems in hospital buildings.
8. Allows OSHPD to enter into contracts with qualified
persons or entities in order to facilitate the timely
performance of the duties and responsibilities relating
to the review and inspection of hospital building
construction or alteration.
9. Requires OSHPD to assess the processing time for plan
review and to provide an update on this assessment to
the appropriate policy and fiscal committees of the
Legislature no later than February 1, 2007, and annually
thereafter. OSHPD must also, contingent on an
appropriation in the annual budget, establish a program
for training fire and life safety officers, in order to
provide a sufficient number of qualified persons to
facilitate the timely performance of its duties and
responsibilities.
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This bill:
1. Permits a hospital owner to comply with seismic safety
deadlines and requirements in current law by replacing
all of its buildings subject to seismic retrofit by
January 1, 2020, rather than retrofitting by 2013, and
then replacing them by 2030, if the hospital owner meets
all of the following conditions:
A. The hospital owner has requested an extension of
the 2008 and 2013 seismic safety deadlines.
B. OSHPD certifies that the hospital owner lacks the
financial capacity to meet seismic standards,
providing the hospital owner provides specified
financial information to OSHPD by January 1, 2009,
including information filed annually with OSHPD that
shows that the owner meets all of the following
financial conditions:
(1) The owner's net long term debt to
capitalization ratio, as measured by the ratio of
long term debt to long term equity, was above 60
percent.
(2) The owner's annual debt service coverage, as
measured by the ratio of net income plus
depreciation expense plus interest expense to
current maturities on long term debt, was below
4.5 percent.
(3) The owner's cash to debt ratio, as measured
by the ratio of cash plus marketable securities
plus limited use cash plus limited use investments
to current maturities on long term debt plus net
long term debt, was below 90 percent.
C. The hospital files with OSHPD by January 1, 2009,
a declaration that the hospital for which the owner
is seeking relief satisfies all of the following
conditions:
(1) Maintains a Medi-Cal contract with the
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California Medical Assistance Commission (CMAC),
unless in an open area where CMAC does not
contract.
(2) Maintains at least basic emergency medical
services if the hospital provided such services as
of July 1, 2007.
(3) The hospital meets any of the following
criteria:
(a) The hospital is located within a
Medically Underserved Area or a Health
Professions Shortage Area designated by the
federal government, as specified.
(b) OSHPD determines, by means of a health
impact assessment, that removal of the building
or buildings from service may diminish
significantly the availability or accessibility
of health care services to an underserved
community.
(c) CMAC determines that the hospital is
an essential provider of Medi-Cal services in
the hospital's service area.
(d) The hospital demonstrates that, based
on annual utilization data submitted to the
office for 2006 or later, the hospital had in
one year over 30 percent of all discharges for
either Medi-Cal or indigent patients in the
county in which the hospital is located.
(e) By January 1, 2013, the hospital
submits a building plan for each building
deemed ready for review.
(f) The hospital receives a building
permit to begin construction by January 1,
2015.
(g) The hospital submits a construction
timeline within six months of receipt of the
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building permit that identifies at least all of
the following:
(i) Each building that is
subject to the January 1, 2008 deadline.
(ii) The project number or
numbers for replacement of each building.
(iii) The projected construction
start date or dates and projected
construction completion date(s).
(iv) The building or buildings to
be removed from acute care.
(v) The estimated cost of
construction.
(vi) The name of the contractor.
(h) Every six months thereafter, the
hospital reports to OSHPD on the status of the
project, including any delays or circumstances
that could materially affect the estimated
completion date.
(i) The hospital pays to OSHPD an
additional fee, to be determined by OSHPD,
sufficient to cover the additional cost
incurred for maintaining all reporting
requirements under this bill, including but
not limited to the costs of reviewing and
verifying the financial information submitted
to OSHPD. Prohibits the fee from including any
cost for review of the plans or other duties
related to receiving a building or occupancy
permit.
(j) Provides that a hospital filing a
declaration pursuant to this bill but failing
to meet any of the deadlines be deemed in
violation and subject to loss of licensure.
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2. Permits OSHPD to approve extension of the deadlines for
a hospital that is classified as a nonconforming
Structural Performance Category (SPC)-1 building, and is
owned by a county, city, or county and city, that has
requested an extension of the July 1, 2008 deadline to
file a declaration by June 30, 2009, if the owner files
a declaration with the office that as of the date of
that filing the owner lacks the financial capacity to
meet the January 1, 2008 deadline for that building.
Requires the declaration to set forth the commitment of
the hospital to replace those buildings by 2020 with
other buildings that meet SPC-5.
3. Requires OSHPD to prepare and provide to the Legislature
prior to April 1, 2008, a report that details how the
field review and approval process, as specified, will be
implemented without undue delay.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 9/11/07)
American Federation of State, County and Municipal
Employees, AFL-CIO
California Hospital Association
City of San Diego
Daughters of Charity Health System
Service Employees International Union
Stanford Hospital
The American Institute of Architects California Council
University of California
OPPOSITION : (Verified 9/11/07)
California Nurses Association
ASSEMBLY FLOOR :
AYES: Adams, Aghazarian, Anderson, Arambula, Bass, Beall,
Benoit, Berg, Berryhill, Brownley, Caballero, Carter,
Cook, Coto, Davis, De La Torre, De Leon, DeSaulnier,
DeVore, Duvall, Dymally, Emmerson, Evans, Feuer, Fuentes,
Fuller, Gaines, Galgiani, Garcia, Garrick, Hernandez,
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Horton, Houston, Huff, Huffman, Jeffries, Jones,
Karnette, Keene, Krekorian, La Malfa, Laird, Leno,
Levine, Ma, Maze, Mendoza, Mullin, Nakanishi, Niello,
Parra, Plescia, Portantino, Price, Sharon Runner, Ruskin,
Salas, Saldana, Silva, Smyth, Solorio, Soto, Spitzer,
Swanson, Torrico, Tran, Villines, Walters, Wolk, Nunez
NOES: Blakeslee, Charles Calderon
NO VOTE RECORDED: Eng, Hancock, Hayashi, Lieber, Lieu,
Nava, Strickland, Vacancy
CTW:mw 9/11/07 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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