BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 1124
                                                                  Page  1

          Date of Hearing:   May 13, 2009

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Kevin De Leon, Chair

                   AB 1124 (Yamada) - As Amended:  April 22, 2009 

          Policy Committee:                              Education  
          Vote:10-0

          Urgency:     No                   State Mandated Local Program:  
          Yes    Reimbursable:              Yes

           SUMMARY  

          This bill requires a local education agency (LEA) to continue  
          providing early intervention services to a child with  
          exceptional needs between the ages of three and five years in a  
          preschool program (if the child is no longer eligible for  
          services under federal law), pending the resolution of a due  
          process hearing, as specified.  Specifically, this bill: 

          1)Specifies that this requirement will only be implemented to  
            the extent that the Legislature appropriates federal American  
            Recovery and Reinvestment Act of 2009 (ARRA) funds or other  
            funds intended to provide higher levels of federal special  
            education funding for this purpose.  

          2)Deletes existing statute that prohibits the requirement for  
            LEAs to provide early intervention services to a child with  
            exceptional needs between the ages of three and five years, as  
            specified.  

           FISCAL EFFECT  

          GF/98 costs, likely between $360,000 and $720,000, to require  
          LEAs to continue providing early intervention services to a  
          pupil with special needs between the ages of three and five, as  
          specified.  

          Between July 2005 and April 2007, the State Department of  
          Education (SDE) reports there were 225 due process hearings  
          conducted by the Office of Administrative Law.  Of this number,  
          approximately 12 cases involved children who turned three years  
          of age during this process.   SDE reports that there are  
          approximately 34,450 children who turned three and receive  
          services under IDEA Part C.  






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          COMMENTS  

           1)Background  .  The federal Individuals with Disabilities  
            Education Act (IDEA) delineates rights and services for  
            persons with disabilities. A portion of IDEA requires infants  
            and toddlers with disabilities to receive early intervention  
            services form birth through age three, as specified in their  
            Individualized Family Services Plan (IFSP) (now known as IDEA  
            Part C). These services include health services, family  
            counseling, occupational therapy, psychological services, and  
            speech/language services. Services are provided through the  
            state's 21 developmental disabilities regional centers,  
            administered by the Department of Developmental Services  
            (DDS).  Children between the ages of three and 21 receive  
            special education services through LEAs, as specified in their  
            Individual Education Plan (IEP) (now known as IDEA Part B). 

            For children receiving special education services between the  
            age of three and 21, federal IDEA Part B statute requires  
            appeal procedures, including due process hearings, to resolve  
            disagreements regarding educational placements and/or the  
            contents of a pupil's IEP. Federal law further requires that  
            while the dispute is being resolved a pupil is allowed to  
            remain in his or her current educational placement and  
            continue to receive services specified in the IEP. This is  
            referred to as "stay-put." Stay-put ensures stability for the  
            pupil and is intended to minimize disruption and turmoil in  
            the child's education. 

            In 2006, the United State Department of Education (USDOE)  
            issued regulations regarding the stay-put provision of IDEA  
            that state the LEA is not required to provide the educational  
            services (Part B) while the dispute is being resolved. AB 1663  
            (Evans), Chapter 454, Statutes of 2007 made several revisions  
            to state special education law to comply with IDEA, including  
            conforming to IDEA's regulations regarding stay-put  
            provisions. This bill would amend state law to reverse Chapter  
            454's conforming changes and require LEAs to continue  
            providing early intervention services under IDEA Part C to a  
            child between three and five years of age, as specified. 

           2)How did California address the "stay put" provision prior to  
            Chapter 454  ? Prior to Chapter 454, California was silent on  
            the "stay-put" provisions and the courts and dispute  
            resolution hearing offers interpreted this provision at their  
            discretion. For example, in Johnson v. Special Education  






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            Hearing Office (9th Cir. 2002) 287 F.3d 1176, the federal 9th  
            Circuit Court of Appeals, which includes California, addressed  
            the issue of stay-put for children transitioning from early  
            intervention to preschool programs. The court held that, under  
            the IDEA stay-put, when disputes arise concerning children  
            transitioning from Part C to Part B, school districts are  
            required to provide a program in conformity with that provided  
            under Part C pending resolution of a dispute. The 3rd Circuit  
            similarly required a school district to provide services per a  
            student's Part C IFSP pending resolution of a dispute. 

           3)Federal ARRA funds  .  In February 2009, the federal government  
            passed the ARRA, which allocated approximately $100 billion  
            nationwide for education programs with the purpose of  
            stimulating the economy.  Of this amount, California is  
            expected to receive approximately $8 billion.  

            According to SDE, California is expected to receive $11.7  
            billion in one-time funds for services for students with  
            disabilities pursuant to IDEA, based on the existing federal  
            formula. Of this total, $11.3 billion is for IDEA Part B for  
            children ages 6 - 21 and $400 million is for IDEA Part B, for  
            children ages 3 - 5.  

            ARRA also provides $500 million one-time via existing formula  
            for IDEA Part C, for children age 0 to 2. In California, these  
            funds are administered by DDS for the regional centers.  

            In April 2009, the Department of Finance (DOF) issued a  
            Section 28.00 letter to allocate $634 million in federal ARRA  
            IDEA funds.  Section 28.00 is a provision in the annual budget  
            act that authorizes the Director of DOF to augment the  
            expenditure of unanticipated federal funds.  

            Of the $634 million, $613.5 million one-time is for IDEA Part  
            B (services to children between the ages of 3-21) and $20.58  
            million one-time is for IDEA Part B - Preschool grants.  ARRA  
            statute related to special education funding states: "a state  
            may not use funds paid to it under this part to satisfy  
            state-law mandated funding obligations to LEAs, including  
            funding based on student attendance or enrollment, or  
            inflation."  Likewise, according to DOF's letter, "IDEA  
            recovery funds must be allocated and used by LEAs according to  
             current  IDEA statutory and regulatory requirements."  

            This bill proposes to use on-time ARRA funds to pay the costs  
            of an on-going requirement that is no longer in federal IDEA  






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            statute (i.e., the stay-put provision for children ages three  
            to five).  According to federal statute and DOF's letter, this  
            is not allowable under ARRA.        


           4)SDE and DDS joint venture on transition practices for pupils  
            with special needs  .  In April 2009, SDE and DDS issued letters  
            to their respected fields regarding smooth transitions from  
            IDEA Part C to IDEA Part B for pupils with special needs.   
            Specifically, both departments will participate in a technical  
            assistance and support project conducted by the Western  
            Regional Resource Center.  


          5)The Governor's 2009-10 budget proposed to suspend all but  
            three K-14 mandates through 2010-11  .  In December 2008, a San  
            Diego Superior Court judge ruled that the Legislature's  
            practice of budgeting $1,000 in the annual budget act for  
            certain mandates in order to defer payment on the total claim  
            is unconstitutional. The ruling was in response to a lawsuit  
            filed in 2007 by five school districts and the California  
            School Boards Association against DOF and the State Controller  
            seeking payment of past mandate claims and to end the act of  
            deferring K-12 education mandates. 


            While constitutional separation of powers left the court with  
            the inability to force the Legislature to make budgetary  
            appropriations for K-12 mandates, its decision increases  
            pressure on the state to pay the annual ongoing cost of these  
            mandates.  

               
           6)Previous legislation  .  AB 1768 (Evans), similar to this  
            measure, was held on this committee's suspense file in May  
            2008.      




           Analysis Prepared by  :    Kimberly Rodriguez / APPR. / (916)  
          319-2081