BILL ANALYSIS Senate Appropriations Committee Fiscal Summary Senator Christine Kehoe, Chair 1757 (Monning) Hearing Date: 08/02/2010 Amended: 07/15/2010 Consultant: Maureen Ortiz Policy Vote: VA 4-0 _________________________________________________________________ ____ BILL SUMMARY: AB 1757 authorizes the design and construction of a state owned veterans cemetery to be located on the site of the former Fort Ord in Monterey County. _________________________________________________________________ ____ Fiscal Impact (in thousands) Major Provisions 2010-11 2011-12 2012-13 Fund Cemetery design $800 Special* *California Central Coast State Veterans Cemetery at Fort Ord Endowment Fund _________________________________________________________________ ____ STAFF COMMENTS: This bill meets the criteria for referral to the Suspense file. The current cost estimate to complete preliminary plans and working drawings, is approximately $800,000. These funds would be transferred from the Endowment Fund, and any costs for the design activities would subsequently be reimbursed by the federal government once the grant is awarded. Additionally, all costs associated with the design, construction and equipping of the veterans cemetery will be reimbursed through the federal grant program. AB 1757 requires the Department of Veterans Affairs, in voluntary cooperation with the County of Monterey, the City of Seaside, the Fort Ord Reuse Authority, and surrounding counties, cities, and local agencies, to design, develop, and construct the state-owned and state-operated veterans cemetery at Ford Ord. Specifically, AB 1757 requires the cemetery to be built with the "usual phases of a capital outlay project" which includes studies, preliminary plans, working drawings including documents necessary to put the construction phase out to bid, and construction of the cemetery. This will allow the department to proceed with all activities necessary to complete preliminary plans and working drawings. The department will be prohibited from advertising for construction bids until the Endowment Fund has adequate principal to cover annual administrative and oversight costs. The bill requires the Controller, upon appropriation by the Legislature, to transfer funds from the Endowment Fund to the Operations Fund in the amount at least equal to the estimated costs to complete preliminary plans and working drawings. The Department would be authorized to proceed with all activities necessary to support the submission of the grant application, and upon certification of the grant award, to begin construction and equipping the veterans cemetery. AB 1757 requires the Secretary of the California Department of Veterans Affairs to establish the California Central Coast Veterans Cemetery Advisory Committee consisting of the following persons, to be appointed by the Secretary: Page 2 AB 1757 (Monning) 1)One representative from the County of Monterey, nominated by the Board of Supervisors of the County of Monterey. 2)One representative from the City of Seaside, nominated by the City Council of the City of Seaside. 3)One representative from the Fort Ord Reuse Authority. 4)Two members from the Fort Ord Veterans Cemetery Citizens Advisory Committee. 5)At least two members from the department. The bill requires the Department to seek the advice of the Advisory Committee when considering significant changes in the design of the veterans cemetery. AB 3035 (Laird, Chapter 291, Statutes of 2006) established the California Central Coast State Veterans Cemetery at Fort Ord Endowment Fund for the receipt of donations of personal property, including cash or other gifts, to be used for the maintenance of the veterans' cemetery. AB 3035 provided that moneys in the fund must first be invested with the goal of achieving ongoing earnings sufficient to cover the estimated annual oversight and maintenance costs for ten years once the cemetery is completed. After determination that sufficient funds have become available, that bill required the DVA to submit a federal State Veterans' Cemetery Grant Program application to the United States DVA for an amount representing 100% of the estimated costs for designing, developing, constructing, and equipping the cemetery. The military base at Fort Ord was established in 1917 and in 1940 was declared a permanent Army post. In 1991, Fort Ord was announced for closure by the United States Base Realignment and Closure Commission. Prior to its closure, the Fort Ord Reuse Authority set aside 204 acres for the development of a Central Coast Veterans' Cemetery. Previous attempts at obtaining a national cemetery at the Fort Ord location have failed because federal regulations prohibit the development of a national veterans cemetery within 75 miles of another national veterans cemetery. Fort Ord is located within 75 miles of the San Joaquin Valley National Veterans' Cemetery in Gustine. As an alternate to a national veterans cemetery, the federal government will pay 100% of construction costs for a state run cemetery, however, the state has the continuing responsibility for paying the annual maintenance and operation costs which were estimated at $500,000 per year. Consequently, although the intent is for private donations to fully fund the maintenance costs, there is no guarantee that those costs will not ultimately fall upon the state and require a General Fund appropriation in the future. There is currently one other state veterans cemetery in California, located in Redding. AB 1757 will also authorize the use of any excess balances in the Endowment Fund to be used, upon appropriation by the Legislature, to establish monuments, memorials, and amenities.