BILL ANALYSIS                                                                                                                                                                                                    




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                           1046 (Cogdill)
          
          Hearing Date:  05/03/2010           Amended: 04/07/2010
          Consultant:  Jacqueline Wong-HernandezPolicy Vote: Education  
          7-0, Judiciary 4-0
          _________________________________________________________________ 
          ____
          BILL SUMMARY: This bill would remove the California State  
          University (CSU) from the jurisdiction of the Victim  
          Compensation and Government Claims Board (VCGCB) and allow the  
          CSU to process its own tort claims.
          _________________________________________________________________ 
          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2010-11      2011-12       2012-13     Fund
           
          CSU processes claims                  *Minor revenue loss to  
          VCGCB*               General
                                                                 *Likely  
          minor savings to CSU*                                   
          _________________________________________________________________ 
          ____
          STAFF COMMENTS: 

          The existing Government Tort Claims Act (TCA) establishes the  
          procedures for filing a claim against a public agency, and  
          provides that the VCGCB may collect a 15% surcharge on each  
          claim (Government Code Section 810 et seq). Unless a state  
          agency is exempt from TCA, its claimed are filed with and  
          processed by the VCGCB. This bill would exempt CSU from having  
          its claims under VCGCB jurisdiction, but would otherwise still  
          require CSU to maintain internal claim processing rules that are  
          consistent with the TCA.

          CSU tort claims are currently filed with the VCGCB. It is then  
          transmitted to the Risk Management Department of CSU for  
          investigation and determination of whether to settle the claim  
          or allow it to go to litigation. When CSU decides to settle a  
          claim, it must be approved by VCGCB, which then collects a 15%  
          surcharge from CSU on the amount of the claim. When a claim is  
          denied, the VCGCB notifies the claimant that he or she has six  
          months to initiate court action against CSU; VCGCB is no longer  










          involved. By allowing CSU to fully process its own tort claims  
          (on which it already does substantial work), CSU would avoid the  
          15% surcharge it pays to the VCGCB on each approved claim. To  
          the extent that CSU could fully process its own claims within  
          existing staff resources, this would be a direct savings to CSU.

          The total amount of savings to CSU, and revenue loss to VCGCB,  
          would be minor - likely less than $10,000 annually. In fiscal  
          year 2007-08, 118 claims were filed against CSU and 19 claims  
          were approved for a total of $89,893 paid to claimants. The  
          surcharge on these claims was $9,176. In fiscal year 2008-09, 70  
          claims were filed against CSU and 16 claims were approved for a  
          total of $36,048 paid to claimants. The surcharge on these  
          claims was $3,988. VCGCB's workload would also decrease with the  
          loss revenue, because it would no longer be processing CSU tort  
          claims.