BILL ANALYSIS SB 1046 Page 1 Date of Hearing: August 4, 2010 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair SB 1046 (Cogdill) - As Amended: April 7, 2010 Policy Committee: Higher EducationVote: 9-0 Judiciary 10-0 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill removes the California State University (CSU) from the jurisdiction of the Victim Compensation and Government Claims Board (VCGCB) and instead allows the CSU to process its own tort claims consistent with procedures established in the Government Tort Claims Act (TCA). FISCAL EFFECT Minor revenue loss to the VCGCB and minor administrative cost savings to the CSU. COMMENTS 1)Background . The TCA establishes procedures for filing a claim against a public agency. Currently, CSU tort claims are filed with the VCGCB, then transmitted to CSU's Risk Management Department for investigation and determination of whether to settle the claim or allow the claim to go to litigation. If CSU decides to settle a claim, this action must be approved by VCGCB, which collects an administrative surcharge from CSU equal to 15% of the amount of the claim. If a claim is denied, the VCGCB notifies the claimant that he or she has six months to initiate court action against CSU; VCGCB is then no longer involved. 2)Purpose . Unless a state agency is exempt from TCA, its claims are filed with and processed by the VCGCB. This bill exempts CSU from having its claims under VCGCB jurisdiction, but otherwise requires CSU to maintain internal claim processing SB 1046 Page 2 rules consistent with the TCA. Allowing CSU to fully process its own tort claims would avoid the VCGCB surcharge. The University of California enjoys a similar TCA exemption. In 2007-08, 118 claims were filed against CSU and 19 were approved for a total of $89,893 paid to claimants. The VCGCB surcharge on these claims was $9,176. In 2008-09, 70 claims were filed against CSU and 16 were approved for a total of $36,048 paid to claimants. The surcharge amount was $3,988. 3)Opposition . The VCGCB argues that the bill would deny claimants a neutral third party (the board) for claims against CSU and could set a precedent for other state entities seeking to independently administer their own claims. Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081