BILL ANALYSIS SENATE HEALTH COMMITTEE ANALYSIS Senator Elaine K. Alquist, Chair BILL NO: SB 769 S AUTHOR: Alquist B AMENDED: August 16, 2010 HEARING DATE: August 25, 2010 7 CONSULTANT: 6 Orr/ 9 PURSUANT TO S.R. 29.10 SUBJECT Federal funding: supplemental appropriations: pandemic influenza SUMMARY This bill provides that federal funding received pursuant to the federal Supplemental Appropriations Act, 2009 for pandemic flu preparedness and response, shall be subject to appropriation by the Legislature for allocation by the California Department of Public Health (CDPH) pursuant to the 2008-09 federally approved collaborative state-local plan, which effectively allocates funds in a 70/30 local/state split. CHANGES TO EXISTING LAW Existing law: Establishes local health departments to protect and preserve the public health. Provides for the allocation of state aid to local health departments according to a specified formula for prescribed purposes, including communicable disease control activities and community and public health surveillance activities. Continued--- STAFF ANALYSIS OF SENATE BILL 769 (Alquist) Page 2 Requires that federal funding received by the state for bioterrorism preparedness and emergency response be subject to appropriation in the annual Budget Act or other statute, commencing with the 2003-04 fiscal year, and pursuant to the federally approved collaborative state-local plan. These provisions become inoperative as of September 1, 2010. Established a basic allotment of one hundred thousand dollars ($100,000) to the administrative bodies of each local health jurisdiction (LHJ), subject to the availability of funds appropriated in the annual Budget Act or another act, for the 2003-04 fiscal year and subsequent fiscal years. Requires that the balance, if any, of the annual appropriation be allotted on a per capita basis in proportion to the population of each eligible LHJ. These provisions become inoperative as of September 1, 2010 and are repealed as of January 1, 2011. This bill: Requires that federal funding received pursuant to the 2009 Supplemental Appropriations Act for pandemic influenza, for purposes of state and local public health and emergency response infrastructure, be subject to appropriation by the Legislature in the annual Budget Act or other statute. This applies to federal funding provided by the Public Health Emergency Preparedness Cooperative Agreement and the Public Health Emergency Response Cooperative Agreement for state and LHJs. Requires that the proportion of funds allocated to support LHJ activities shall be at least the proportion stipulated in the 2008-09 federally approved state applications for the Public Health Emergency Preparedness Cooperative Agreement unless stipulated otherwise by federal law or guidance. Makes an exception if the department, in consultation with the California Conference of Local Health Officers (CCLHO) and the County Health Executives Association of California (CHEAC), submits an application that specifies a different funding allocation. Allows CDPH to establish a minimum allocation of less than one hundred thousand dollars ($100,000) to LHJs, if the department consults with CCLHO and CHEAC. STAFF ANALYSIS OF SENATE BILL 769 (Alquist) Page 3 Declares the bill provisions inoperative on September 1, 2012, thereby extending the sunset date two years. Makes findings and declarations regarding public health infrastructure and the need to ensure that federal funds for public health emergency response to a pandemic influenza outbreak are distributed appropriately to LHJs. Declares the bill an urgency measure in order to ensure an adequate and timely response to the H1N1 virus and other public health threats. FISCAL IMPACT The Assembly Appropriations Committee estimates unknown future distributions of federal funding, in the 70 percent- 30percent sharing ratio. BACKGROUND AND DISCUSSION The author asserts that this bill establishes a standard that local health departments (LHDs) receive at least 70 percent of any public health emergency preparedness funds released to the state by the federal government. This formula, called the 70/30 split, has been used by the state since September 11, 2001 to allocate federal public health emergency preparedness funds to the local health jurisdictions. Over $500 million have been allocated to California for public health emergency preparedness since that time. These funds have been critical to the modernization and enhancement of public health infrastructure at the local level. Because of a lack of both state and local funding, the author claims federal dollars have been the only significant funds available to improve the core public health capabilities of disease identification, control and prevention. This bill also extends the sunset on provisions that give CDPH the authority to continue to allocate federal emergency preparedness funds. As a result of the H1N1 outbreak that began during the spring of 2009, additional federal funding was supplied to the states to respond to this public health threat. Approximately $120 million has been provided to California STAFF ANALYSIS OF SENATE BILL 769 (Alquist) Page 4 for this purpose. The first three phases of this money have been allocated to the locals on a 70/30 split. Several billion dollars are still available at the federal level for future pandemic flu outbreaks. This bill will insure future federal allocations to California will be directed to local levels based on the same 70/30 split. Pandemic influenza Influenza A (H1N1) virus is a subtype of influenza A and the most common cause of flu in humans. In 2006, H1N1 caused approximately half of all human flu. In 2009, the World Health Organization (WHO) declared that a new strain of swine-origin was responsible for a global flu pandemic. The WHO declared an alert level phase 6, indicating widespread human infection. That was the first time it raised the alert level that high in 40 years. The H1N1 isolated in American patients has been found to be a genetic mixture of four strains: including avian, swine, and human genetic characteristics. Funding for public health emergency preparedness and response Congress authorized funding for the Public Health Emergency Preparedness (PHEP) cooperative agreement to support preparedness nationwide in state, local, tribal, and territorial public health departments in 2002, shortly after the events of September 11, 2001, and subsequent anthrax attacks. The PHEP cooperative agreement provides funding to enable public health departments to have the capacity and capability to effectively respond to the public health consequences of not only terrorist threats, but also infectious disease outbreaks, natural disasters, and biological, chemical, nuclear, and radiological emergencies. Congress appropriated funding in June 2009 through the 2009 Supplemental Appropriations Act for the "Public Health and Social Services Emergency Fund" to prepare for and respond to an influenza pandemic. This funding provided the Department of Health and Human Services (HHS), the Centers for Disease Control and Prevention (CDC), and other federal and state agencies with resources to respond to ongoing and emerging outbreaks of novel H1N1 influenza in the United States. To date, CDC is administering $1.35 billion through the Public Health Emergency Response (PHER) grant to STAFF ANALYSIS OF SENATE BILL 769 (Alquist) Page 5 upgrade state and local pandemic influenza preparedness and response capacity. Funding was distributed in phases. Phase I funding of $260 million was awarded beginning July 31, 2009. An additional $248 million in PHER Phase II funding was released nationwide beginning August 21, 2009, and another $846 million in PHER Phase III funding was awarded nationwide for implementation of the 2009 H1N1 influenza mass vaccination campaign, which began in October of 2009. A total of $49.7 million in PHER Phase IV funding has been awarded to 15 states and localities, including California, to complete their H1N1 vaccination programs, specifically targeting high-risk populations, minority and hard-to-reach populations, and underserved and vulnerable populations that may have been unable to access vaccination services previously. Phase IV funds have been allocated using a base-plus-population formula, with 100 percent of the funds available beginning March 18, 2010. Prior legislation SB 678 (Ortiz), Chapter 35, Statutes of 2004, allocated $18 million in federal funding for implementing bioterrorism and smallpox preparedness measures to DPH and LHJ. SB 406 (Ortiz), Chapter 393, Statutes of 2002, established requirements with respect to allocation of federal emergency funding and the state-local plan similar to SB 769. Arguments in support The County of San Diego believes this bill establishes procedures for the distribution of the federal funding received by the state for the purpose of responding to a pandemic influenza outbreak, and authorizes CDPH to establish a minimum allocation of $100,000 to LHJs as specified. Receipt of supplemental funding could help support the maintenance of San Diego County's current public health workforce and could improve the quality of the county's response to a local influenza pandemic in terms of surveillance, laboratory capacity, and technology. STAFF ANALYSIS OF SENATE BILL 769 (Alquist) Page 6 PRIOR ACTIONS Senate Health: 11-0 Senate Floor: 36-0 Assembly Health: 18-0 Assembly Appropriations: 17-0 Assembly Floor: 77-0 Senate Floor: 26-1 Assembly Floor: 76-0 COMMENTS 1. Recent amendments. When this bill was heard in the Senate Health Committee on April 22, 2009, it did the following: a. Required federal funding received pursuant to the Recovery Act, for purposes of chronic disease prevention and wellness, to be subject to appropriation by the Legislature commencing with the 2009-10 fiscal year. b. Provided that its provisions apply when federal funding is allocated and expended for disease control and prevention activities by LHJs and specifies that funds appropriated for those purposes cannot be used to supplant funding for existing levels of service. c. Required allocations to be made by the Department of Public Health (DPH) to the administrative bodies of qualifying local health jurisdictions and requires funds to be used for activities to improve and enhance evidence-based clinical and community- based prevention and wellness strategies authorized by the federal Public Health Services Act that deliver specific measurable health outcomes that address chronic disease rates. The Assembly amendments: a. Specify that the provisions of the bill apply to federal STAFF ANALYSIS OF SENATE BILL 769 (Alquist) Page 7 funding provided by the Public Health Emergency Preparedness Cooperative Agreement and the Public Health Emergency Response Cooperative Agreement for state and local health jurisdictions (LHJ). b. Require that the proportion of funds allocated to support LHJ activities shall be at least the proportion stipulated in the 2008-09 federally approved state applications for the Public Health Emergency Preparedness Cooperative Agreement unless stipulated otherwise by federal law or guidance with specified exceptions. c. Allow the department to establish a minimum allocation of less than one hundred thousand dollars ($100,000) to LHJs, as specified. d. Sunset the bill as of January 1, 2013. e. Declare the bill an urgency measure. POSITIONS Support: Health Officers Association of California (Sponsor) California State Association of Counties County Health Executives Association of California County of San Diego Regional Council of Rural Counties Santa Clara County Board of Supervisors Urban Counties Caucus Oppose: None received -- END --