BILL NUMBER: AB 103	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 2, 2012
	AMENDED IN SENATE  MARCH 22, 2012
	AMENDED IN SENATE  JULY 11, 2011
	AMENDED IN SENATE  JUNE 12, 2011
	AMENDED IN SENATE  MARCH 24, 2011
	AMENDED IN SENATE  MARCH 17, 2011
	AMENDED IN SENATE  MARCH 14, 2011

INTRODUCED BY   Committee on Budget (Blumenfield (Chair), Alejo,
Allen, Brownley, Buchanan, Butler, Cedillo, Chesbro, Dickinson,
Feuer, Gordon, Huffman, Mitchell, Monning, and Swanson)

                        JANUARY 10, 2011

   An act  relating to the Budget Act of 2011  
to amend Sections 16325, 16325.5, 16326, and 16428 of, and to repeal
Section 16324 of, the Government Code, relating to state cash
resources, and making an appropriation therefor, to take effect
immediately, bill related to the budget  .


	LEGISLATIVE COUNSEL'S DIGEST


   AB 103, as amended, Committee on Budget.  Budget Act of
2011.   State cash resources.  
   (1) Existing law, until September 1, 2012, declares the need for
an effective cash management program for the 2010-11 and 2011-12
fiscal years, and exempts activities to implement and carry out the
cash management plan from the Administrative Procedure Act. 

   This bill would extend these provisions through the 2012-13 fiscal
year.  
   (2) Existing law, for the 2010-11 and 2011-12 fiscal years,
prohibits payments made by the state to the University of California
and the California State University from exceeding 1/12 of the annual
appropriation for each month from July through April.  
   This bill would extend that prohibition through the 2012-13 fiscal
year and would exclude from the prohibition transfers and rental
payments that support lease-revenue bonds.  
   (3) Existing law, until September 1, 2012, enacts the cash
management plan to authorize the Controller, Treasurer, and Director
of Finance to defer General Fund payments for up to 60 or 90 days, as
specified, for specific entities, including county offices of
education, public schools, and charter schools, subject to certain
conditions. Existing law provides a process by which county offices
of education, public schools, and charter schools may receive
payments that would otherwise be deferred, permits those entities to
apply for a hardship waiver even if earlier payments were deferred.
Existing law prohibits the total amount of deferrals to school
districts, county offices of education, and charter schools from
exceeding $2,500,000,000 at any given time and requires the
Controller, Treasurer, and Director of Finance to determine and
jointly provide a written declaration of the amounts and timing of
payment deferrals for the 2010-11 fiscal year to the Legislature and
to the State Department of Education, and requires the State
Department of Education to provide this information to school
districts, county offices of education, and charter schools no later
than March 31, 2010.  
   This bill would eliminate the limit of $2,500,000,000 in deferrals
to school districts, county offices of education, and charter
schools. The bill would, for the 2012-13 fiscal year, provide for
deferrals and repayment of those deferrals for kindergarten to grade
12, inclusive, and would provide that a county office of education, a
charter school, or a school district may receive scheduled payments
from the Controller if payments are deferred and a certification is
made on or before June 1, 2012, that the deferral of warrants will
result in the county office of education being unable to meet its
expenditure obligations for the time period in which payments are
deferred, as specified. The bill would also provide a process for a
county office of education, a charter school, or a school district to
seek a hardship waiver for the March 2013 deferral.  
   The bill would also require payment of the March 2013 deferral to
the county offices of education, school districts, and charter
schools to be made no later than April 29, 2013.  
   (4) Existing law requires the Controller, subject to the approval
of the Department of Finance, to pay the full amount of the
apportionment payments for March 2010 for a community college for
which the Chancellor of the California Community Colleges determines,
in consultation with the Director of Finance, on or before March 15,
2010, that a deferral of payment would present an imminent threat to
the fiscal integrity and security of the community colleges. 

   This bill would, for the 2012-13 fiscal year, require the
deferrals of apportionments to community college districts in the
amounts of $150,000,000 to be made from July to December, $50,000,000
to be made from September to January, and $100,000,000 to be made
from October to January. The bill would require the Controller to
issue warrants that include the full apportionment of payments for
the months of July, September, or October, or any combination of
those months, for a community college for which the Chancellor of the
California Community Colleges determines, in consultation with the
Director of Finance, on or before June 1 of the preceding fiscal year
that deferral of warrants will present an imminent threat to the
fiscal integrity and security of the community college.  
   This bill would also repeal obsolete provisions regarding the
deferral of certain payments.  
   (6) Existing law requires all money received by the state as
litigation deposits, except as specified, to be deposited in the
Litigation Deposits Fund in the State Treasury. Existing law
authorizes the investment and reinvestment of those funds and
requires all revenues earned from the investment or deposit of fund
moneys to be deposited in the fund. Existing law changes the
Department of Justice with control of the fund, as specified. 

   This bill would authorize the Controller to use money in the fund
for cash flow loans to the General Fund, as specified.  
   (7) This bill would appropriate $1,000 from the General Fund to
the Controller for administrative costs associated with this bill.
 
   (8) This bill would declare that it is to take effect immediately
as a bill providing for appropriations related to the Budget Bill.
 
   This bill would express the intent of the Legislature to enact
statutory changes relating to the Budget Act of 2011. 
   Vote: majority. Appropriation:  no   yes
 . Fiscal committee:  no   yes  .
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    Section 16324 of the  
Government Code   is repealed.  
   16324.  (a) Notwithstanding any other law, in order to effectively
manage state cash resources, the General Fund payments to be made in
March 2010 for the programs or departments listed in subdivision (b)
shall be paid no sooner than April 15, 2010, but not later than May
1, 2010, which shall be carried out by the Controller, subject to
subdivision (c). Nothing in this section shall be construed to
authorize the deferral of state payroll, debt service, or rental
payments that support lease-revenue bonds.
   (b) The departments and programs subject to subdivision (a) are as
follows:
   (1) California Community Colleges (excluding twelve million
dollars ($12,000,000)).
   (2) Trial court operations (nonpayroll).
   (3) California State University.
   (4) University of California.
   (c) Prior to each of the payment deferrals identified in
subdivision (b), the Controller, Treasurer, and Director of Finance
shall jointly review and compare the actual General Fund receipts and
disbursements with the receipt and disbursement projections
contained in the cashflow statements associated with the proposed
2010-11 Governor's Budget. If the Controller, Treasurer, and Director
of Finance determine sufficient cash is available to make all
scheduled payments through April 15, 2010, including the payments
otherwise subject to deferral identified in subdivision (b), and
maintain a prudent cash reserve, the Controller shall make the
payments as originally scheduled. The Department of Finance shall
notify the Joint Legislative Budget Committee within 10 days of
making this determination.
   (d) In the event payments are deferred pursuant to subdivision
(a), beginning April 1, 2010, the Controller, Treasurer, and Director
of Finance shall review daily the actual cash receipts and
disbursements in comparison to the receipt and disbursement
projections associated with the proposed 2010-11 Governor's Budget.
If the Controller, Treasurer, and Director of Finance determine
sufficient cash is available to make payments through April 15, 2010,
including the payments otherwise subject to deferral identified in
subdivision (b), and maintain a prudent cash reserve, the Controller
shall make the deferred payments, in whole or in part, as soon as
feasible, in the order listed in subdivision (b). The Department of
Finance shall notify the Joint Legislative Budget Committee within 10
days of making this determination and identify the date upon which
the payments were made.
   (e) Notwithstanding paragraph (1) of subdivision (b), and subject
to the approval of the Director of Finance, the Controller shall
issue warrants pursuant to Sections 84320, 84321, and 84321.5 of the
Education Code that include the full amount of the apportionment
payments for the month of March 2010 for a community college for
which the Chancellor of the California Community Colleges determines,
in consultation with the Director of Finance, on or before March 15,
2010, that the deferral of warrants pursuant to this section will
present an imminent threat to the fiscal integrity and security of
the community college. 
  SEC. 2.    Section 16325 of the   Government
Code   is amended to read: 
   16325.  (a) An effective cash management plan is needed for the
2010-11  and   ,  2011-12  , and
2012-13  fiscal years to address General Fund cash shortages
that otherwise may occur during the fiscal year. The goals of the
cash management plan described in this section are to accomplish the
following:
   (1) Increase the state's ability to address cash shortages in a
quick and responsible manner.
   (2) Address rating agencies' and bond markets' concerns regarding
the state's ability to react effectively to cashflow pressures while
providing a higher level of certainty to bondholders.
   (3) Preserve external borrowing capacity and affordability for the
state's infrastructure programs.
   (4) Provide a higher level of predictability to affected programs
and entities where deferrals or delays are required.
   (b) Nothing in this section or in Sections 16325.5 and 16326 shall
be construed to affect in any way the timing or amount of payments
of state payroll or to affect in any way any judicial proceeding
related to the timing or amount of state employee compensation.
Nothing in this section, Section 16325.5, or Section 16326 shall be
construed to authorize the delay of debt service payments, rental
payments that support lease-revenue bonds, reimbursements to local
governments for certain reductions in ad valorem property taxes, as
required by Section 25.5 of Article XIII of the California
Constitution, or required payments for borrowings secured by these
repayment obligations, payments required under a Funds Transfer
Cooperative Agreement that are pledged to pay debt service on state
payment acceleration notes that were issued to finance toll bridge
seismic retrofit and replacement projects, payments appropriated in
any year to pay a court judgment pursuant to the settlement agreement
in Paterno v. State (2003) 113 Cal.App.4th 998, or payments to small
vendors as defined in the California Prompt Payment Act (Chapter 4.5
(commencing with Section 927) of Part 3 of Division 3.6 of Title 1).
Nothing in this section, Section 16325.5, or Section 16326 shall be
construed to affect the applicability of interest, late payment
penalty, and similar payment requirements under the California Prompt
Payment Act when payments to persons or entities specified in those
laws are delayed.
   (c) Deferrals authorized in the cash management plan described in
this section and in Sections 16325.5 and 16326 are in addition to any
payment delays, payment deferrals, or payment schedules specified in
other laws. Deferrals authorized in the cash management plan
described in this section and in Sections 16325.5 and 16326 do not
replace, remove, or alter any previously implemented payment delays
or payment deferrals.
   (d) Activities by the Controller, Treasurer, and Director of
Finance to implement and carry out the cash management plan described
in this section and Sections 16325.5 and 16326 are hereby exempted
from the provisions of the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3).
   (e) This section shall become inoperative on September 1, 
2012,   2013,  and, as of January 1, 
2013,   2014,  is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 
2013,   2014,  deletes or extends the dates on
which it becomes inoperative and is repealed.
   SEC. 3.    Section 16325.5 of the  
Government Code   is amended to read: 
   16325.5.  (a) Notwithstanding any other law, and to the extent not
prohibited by federal law or the California Constitution, in order
to effectively manage state cash resources, the 2010-11  and
  , 2011-12  , and 2012-13  General Fund
payments projected to be made for the programs or departments listed
in subdivision (b) shall be deferred in the months of July, October,
and March, in whole or in part for no more than 60, 90, and 60 days,
respectively, unless otherwise specified in Section 16326  ,
except for the 2011-12 General Fund payments referenced in paragraph
(1) of subdivision (b), which shall be deferred as described in
paragraph (2) of subdivision (a) of Section 16326  . Nothing
in this section shall be construed to authorize the deferral of
state payroll, debt service, or rental payments that support
lease-revenue bonds.
   (b) The departments and programs subject to subdivision (a) are as
follows: 
   (1) Kindergarten to grade 12, inclusive.  
   (2) 
    (1)  Supplementary Security Income/State Supplementary
Payments made by the State Department of Social Services to the
federal government. 
   (3) 
    (2)  Local government social services payments.
   (c) Prior to implementing each of the payment deferrals identified
in subdivision (b) and other provisions of the act adding this
section, the Controller, Treasurer, and Director of Finance shall
jointly review and compare the actual General Fund receipts and
disbursements with the receipts and disbursements contained in the
most current published cashflow projections. If the Controller,
Treasurer, and Director of Finance determine sufficient cash is
available to make scheduled payments, in whole or in part, through
the 60- or 90-day period or other period specified in law, including
the payments otherwise subject to deferral identified in subdivision
(b), and maintain a prudent cash reserve, the Controller shall make
the deferred payment, in whole or in part, as originally scheduled or
within the time provided for by law. In making the determination
that cash is sufficient to make the payments, the Controller,
Treasurer, and Director of Finance shall also consider costs for
state government, the scope of any identified cash shortage, timing,
achievability, legislative direction, and the impact and hardship
imposed on potentially affected programs, entities, and related
public services. The Department of Finance shall notify the Joint
Legislative Budget Committee of this action within 10 days of making
this determination.
   (d) In the event payments are deferred pursuant to subdivision (a)
or other provisions of the act adding this section, beginning July 1
of the appropriate fiscal year, the Controller, Treasurer, and
Director of Finance shall review on a monthly basis, or as necessary,
the actual General Fund cash receipts and disbursements in
comparison to the receipt and disbursement projections associated
with the Governor's most current cashflow statements. If the
Controller, Treasurer, and Director of Finance determine sufficient
cash is available to make payments otherwise deferred for the 60- or
90-day period or other period specified in law, including the
payments otherwise subject to deferral identified in subdivision (b)
or other provisions of the act adding this section, and maintain a
prudent cash reserve, the Controller shall make the deferred
payments, in whole or in part, as soon as feasible unless otherwise
provided in Section 16326. In making the determination that cash is
sufficient to make the payments, in whole or in part, the Controller,
Treasurer, and Director of Finance shall also consider costs for
state government, the scope of any identified cash shortage, timing,
achievability, legislative direction, and the impact and hardship
imposed on potentially affected programs, entities, and related
public services. The Department of Finance shall notify the Joint
Legislative Budget Committee within 10 days of this determination and
identify the date upon which the payments were made or will be made.

   (e) Upon concurrence of the Controller, Treasurer, and Director of
Finance, deferrals authorized pursuant to subdivision (a) or other
provisions of the act adding this section may be moved forward to the
prior month or delayed to the subsequent month. This
subdivision shall not apply to those payments to kindergarten to
grade 12 specified in paragraph (1) of subdivision (b) for the
2011-12 fiscal year.  Any changes may be authorized no
sooner than 30 days after notification in writing by the Department
of Finance to the Joint Legislative Budget Committee, or not sooner
than whatever lesser time the Chairperson of the Joint Legislative
Budget Committee, or his or her designee, may determine. In the event
cash is available to make the payments earlier than identified in
the notification, as determined by the Controller, Treasurer, and
Director of Finance, the Department of Finance shall notify the Joint
Legislative Budget Committee within 10 days of making this
determination.
   (f) This section shall become inoperative on September 1, 
2012,   2013,  and, as of January 1, 
2013,   2014,  is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 
2013,   2014,  deletes or extends the dates on
which it becomes inoperative and is repealed.
   SEC. 4.    Section 16326 of the   Government
Code   is amended to read: 
   16326.  (a) Notwithstanding any other law, except as otherwise
specified in Sections 16325 and 16325.5, cash deferrals specified in
Sections 16325 and 16325.5, as amended by the act amending this
section, shall be limited, as follows: 
   (1) For the 2010-11 fiscal year, payments to school districts,
county offices of education, and charter schools shall be deferred as
specified in Section 16325.5 with the total amount of the deferrals
under this action limited to two billion five hundred million dollars
($2,500,000,000) for each deferral, and a maximum of three deferrals
during the fiscal year. The total outstanding amount of these
deferrals, as described in Section 16325.5, shall not exceed two
billion five hundred million dollars ($2,500,000,000) at any given
time. The Controller, Treasurer, and the Director of Finance shall
determine and jointly provide a written declaration to the
Legislature and to the State Department of Education, and the State
Department of Education shall inform school districts, county offices
of education, and charter schools of the amounts and timing of
payment deferrals for the 2010-11 fiscal year. This declaration shall
be provided no later than March 31, 2010. It is the intent of the
Legislature that the advance principal apportionment payment due in
July be deferred first as a part of the July 2010 deferral as
specified in Section 16325.5.  
   (A) Subject to the approval of the Director of Finance, in order
for a county office of education to receive scheduled apportionments
from the Controller if payments are deferred, as specified in Section
16325.5, the Superintendent of Public Instruction shall certify that
the deferral of warrants will result in the county office of
education being unable to meet its expenditure obligations for the
time period during which warrants are deferred, and shall notify the
Director of Finance of this fact on or before June 1, 2010. Subject
to the approval of the Director of Finance, a county office of
education that did not receive apportionments for July 2010 and
October 2010, as specified in Section 16325.5, may seek a hardship
waiver to receive scheduled apportionments from the Controller if
payments are deferred in March 2011. To apply for a hardship waiver,
the Superintendent of Public Instruction shall certify that the
deferral of March 2011 warrants will result in the county office of
education being unable to meet its expenditure obligations for the
time period during which warrants are deferred, and shall notify the
Director of Finance of this fact on or before January 5, 2011. The
criteria, as applicable, set forth in statute and regulations to
qualify a school district for an emergency apportionment shall be
used to make the certifications specified in this subparagraph.
 
   (B) Subject to the approval of the Director of Finance, in order
for a charter school to receive scheduled apportionments from the
Controller if payments are deferred, as specified in Section 16325.5,
the chartering authority, in consultation with the county
superintendent of schools, shall certify that the deferral of
warrants will result in the charter school being unable to meet its
expenditure obligations for the time period during which warrants are
deferred, and shall notify the Superintendent of Public Instruction
and the Director of Finance of this fact on or before June 1, 2010.
Subject to the approval of the Director of Finance, a charter school
that did not receive apportionments for July 2010 and October 2010,
as specified in Section 16325.5, may seek a hardship waiver to
receive scheduled apportionments from the Controller if payments are
deferred in March 2011. To apply for a hardship waiver, the
chartering authority, in consultation with the county superintendent
of schools, shall certify that the deferral of March 2011 warrants
will result in the charter school being unable to meet its
expenditure obligations for the time period during which warrants are
deferred, and shall notify the Superintendent of Public Instruction
and the Director of Finance on or before January 5, 2011. The
criteria, as applicable, set forth in statute and regulations to
qualify a school district for an emergency apportionment shall be
used to make the certifications specified in this subparagraph.
 
   (C) Subject to the approval of the Director of Finance, in order
for a school district to receive scheduled apportionments from the
Controller if payments are deferred, as specified in Section 16325.5,
the county superintendent of schools shall certify to the
Superintendent of Public Instruction and to the Director of Finance
on or before June 1, 2010, that the deferral of warrants will result
in the school district being unable to meet its expenditure
obligations for the time period during which warrants are deferred.
Subject to the approval of the Director of Finance, a school district
that did not receive apportionments for July 2010 and October 2010,
as specified in Section 16325.5, may seek a hardship waiver to
receive scheduled apportionments from the Controller if payments are
deferred in March 2011. To apply for a hardship waiver, the county
superintendent of schools shall certify to the Superintendent of
Public Instruction and to the Director of Finance on or before
January 5, 2011, that the deferral of March 2011 warrants will result
in the school district being unable to meet its expenditure
obligations for the time period during which warrants are deferred.
The criteria, as applicable, set forth in statute and regulations to
qualify a school district for an emergency apportionment shall be
used to make the certifications specified in this subparagraph.
 
   (D) Notwithstanding Section 16325.5, payment of the March 2011
deferral to county offices of education, school districts, and
charter schools shall be made no later than April 29, 2011. 

   (E) A county office of education may apply for a waiver for early
payment of the deferrals specified in Section 14041.65 of the
Education Code. To receive a waiver, the Superintendent of Public
Instruction shall certify to the Director of Finance before June 1,
2011, that the county office of education would be unable to meet its
expenditure obligations in July or August 2011. Subject to the
approval and determination of the Department of Finance, a county
office of education may receive a payment of 2010-11 funds in July
2011 up to the amount needed to cover its demonstrated expenditure
obligations. The criteria, as applicable, set forth in statute and
regulation to qualify a school district for an emergency
apportionment shall be used to make the certifications specified in
this subparagraph. Required payments of temporary revenue
anticipation notes or other short-term debt issued for cashflow
purposes in 2010-11 shall be considered expenditure obligations.
 
   (F) A charter school may apply for a waiver for early payment of
the deferrals specified in Section 14041.65 of the Education Code. To
receive a waiver, the chartering authority, in consultation with the
county superintendent of schools, shall certify to the
Superintendent of Public Instruction and the Director of Finance
before June 1, 2011, that the charter school would be unable to meet
its expenditure obligations in July or August 2011. Subject to the
approval and determination of the Department of Finance, a charter
school may receive a payment of 2010-11 funds in July 2011 up to the
amount needed to cover its demonstrated expenditure obligations. The
criteria, as applicable, set forth in statute and regulation to
qualify a school district for an emergency apportionment shall be
used to make the certifications specified in this subparagraph.
Required payments of temporary revenue anticipation notes or other
short-term debt issued for cashflow purposes in 2010-11 shall be
considered expenditure obligations.  
   (G) A school district may apply for a waiver for early payment of
the deferrals specified in Section 14041.65 of the Education Code. To
receive a waiver, the county superintendent of schools shall certify
to the Superintendent of Public Instruction and the Director of
Finance before June 1, 2011, that the school district would be unable
to meet its expenditure obligations in July or August 2011. Subject
to the approval and determination of the Department of Finance, a
school district may receive a payment of 2010-11 funds in July 2011
up to the amount needed to cover its demonstrated expenditure
obligations. The criteria, as applicable, set forth in statute and
regulation to qualify a school district for an emergency
apportionment shall be used to make the certifications specified in
this subparagraph. Required payments of temporary revenue
anticipation notes or other short-term debt issued for cashflow
purposes in 2010-11 shall be considered expenditure obligations.
 
   (2) 
    (1)  For the 2011-12 fiscal year, deferrals 
described in paragraph (1) of subdivision (b) of Section 16325.5
  for   kindergarten to grade 12, inclusive
 , and repayment of those deferrals, shall be scheduled as
follows: One billion four hundred million dollars ($1,400,000,000)
shall be deferred in both July and August of 2011. Two billion four
hundred million dollars ($2,400,000,000) shall be deferred in October
2011. Seven hundred million ($700,000,000) of the July 2011 deferral
shall be paid in September 2011, and four billion five hundred
million dollars ($4,500,000,000) shall be paid in January 2012 for
the remaining July, August, and October 2011 deferrals. One billion
four hundred million dollars ($1,400,000,000) shall be deferred in
March 2012 and paid entirely in April 2012. The State Department of
Education shall inform school districts, county offices of education,
and charter schools of the amounts and timing of payment deferrals
for the 2011-12 fiscal year. This declaration shall be provided no
later than April 15, 2011. It is the intent of the Legislature that
the advance principal apportionment payment due in July be deferred
as a part of the July 2011 deferral and that the advance principal
apportionment payment due in August be deferred as a part of the
August 2011 deferral.
   (A) Subject to the approval of the Director of Finance, in order
for a county office of education to receive scheduled payments from
the Controller if payments are deferred, the Superintendent of Public
Instruction shall certify that the deferral of warrants will result
in the county office of education being unable to meet its
expenditure obligations for the time period during which warrants are
deferred, and shall notify the Director of Finance of this fact on
or before June 1, 2011. Subject to the approval of the Director of
Finance, a county office of education that did not receive payments
for July 2011, August 2011, and October 2011 may seek a hardship
waiver to receive scheduled payments from the Controller if payments
are deferred in March 2012. To apply for a hardship waiver, the
Superintendent of Public Instruction shall certify that the deferral
of March 2012 warrants will result in the county office of education
being unable to meet its expenditure obligations for the time period
during which warrants are deferred, and shall notify the Director of
Finance of this fact on or before January 5, 2012. The criteria, as
applicable, set forth in statute and regulations to qualify a school
district for an emergency apportionment shall be used to make the
certifications specified in this subparagraph.
   (B) Subject to the approval of the Director of Finance, in order
for a charter school to receive scheduled payments from the
Controller if payments are deferred, the chartering authority, in
consultation with the county superintendent of schools, shall certify
that the deferral of warrants will result in the charter school
being unable to meet its expenditure obligations for the time period
during which warrants are deferred, and shall notify the
Superintendent of Public Instruction and the Director of Finance of
this fact on or before June 1, 2011. Subject to the approval of the
Director of Finance, a charter school that did not receive payments
for July 2011, August 2011, and October 2011 may seek a hardship
waiver to receive scheduled payments from the Controller if payments
are deferred in March 2012. To apply for a hardship waiver, the
chartering authority, in consultation with the county superintendent
of schools, shall certify that the deferral of March 2012 warrants
will result in the charter school being unable to meet its
expenditure obligations for the time period during which warrants are
deferred, and shall notify the Superintendent of Public Instruction
and the Director of Finance on or before January 5, 2012. The
criteria, as applicable, set forth in
             statute and regulations to qualify a school district for
an emergency apportionment shall be used to make the certifications
specified in this subparagraph.
   (C) Subject to the approval of the Director of Finance, in order
for a school district to receive scheduled payments from the
Controller if payments are deferred, the county superintendent of
schools shall certify to the Superintendent of Public Instruction and
the Director of Finance on or before June 1, 2011, that the deferral
of warrants will result in the school district being unable to meet
its expenditure obligations for the time period during which warrants
are deferred. Subject to the approval of the Director of Finance, a
school district that did not receive payments for July 2011, August
2011, and October 2011 may seek a hardship waiver to receive
scheduled payments from the Controller if payments are deferred in
March 2012. To apply for a hardship waiver, the county superintendent
of schools shall certify to the Superintendent of Public Instruction
and to the Director of Finance on or before January 5, 2012, that
the deferral of March 2012 warrants will result in the school
district being unable to meet its expenditure obligations for the
time period during which warrants are deferred. The criteria, as
applicable, set forth in statute and regulations to qualify a school
district for an emergency apportionment shall be used to make the
certifications specified in this subparagraph.
   (D) Notwithstanding Section 16325.5, payments of the March 2012
deferral to the county offices of education, school districts, and
charter schools, shall be made no later than April 29, 2012. 
   (2) For the 2012-13 fiscal year, deferrals for kindergarten to
grade 12, inclusive, and repayment of those deferrals, shall be
scheduled as follows: One billion two hundred million dollars
($1,200,000,000) shall be deferred in July 2012. Six hundred million
dollars ($600,000,000) shall be deferred in August 2012. Eight
hundred million dollars ($800,000,000) shall be deferred in October
2012. Seven hundred million dollars ($700,000,000) of the deferral
made in July 2012 shall be paid in September 2012, and one billion
nine hundred million dollars ($1,900,000,000) shall be paid in
January 2013 for the remaining deferrals made in July, August, and
October 2012. Nine hundred million dollars ($900,000,000) shall be
deferred in March 2013 and paid entirely in April 2013. The State
Department of Education shall, no later than five days following the
enactment of the act adding this paragraph, inform school districts,
county offices of education, and charter schools of the amounts and
timing of payment deferrals for the 2012-13 fiscal year. It is the
intent of the Legislature that the advance principal apportionment
payment due in July be deferred as a part of the July 2012 deferral
and that the advance principal apportionment payment due in August be
deferred as a part of the August 2012 deferral.  
   (A) Subject to the approval of the Director of Finance, in order
for a county office of education to receive scheduled payments from
the Controller if payments are deferred, the Superintendent of Public
Instruction shall certify that the deferral of warrants will result
in the county office of education being unable to meet its
expenditure obligations for the time period during which warrants are
deferred, and shall notify the Director of Finance of this fact on
or before June 1, 2012. Subject to the approval of the Director of
Finance, a county office of education that did not receive payments
for July 2012, August 2012, and October 2012 may seek a hardship
waiver to receive scheduled payments from the Controller if payments
are deferred in March 2013. To apply for a hardship waiver, the
Superintendent of Public Instruction shall certify that the deferral
of March 2013 warrants will result in the county office of education
being unable to meet its expenditure obligations for the time period
during which warrants are deferred, and shall notify the Director of
Finance on or before January 4, 2013. The criteria, as applicable,
set forth in statute and regulations to qualify a school district for
an emergency apportionment shall be used to make the certifications
specified in this subparagraph.  
   (B) Subject to the approval of the Director of Finance, in order
for a charter school to receive scheduled payments from the
Controller if payments are deferred, the chartering authority, in
consultation with the county superintendent of schools, shall certify
that the deferral of warrants will result in the charter school
being unable to meet its expenditure obligations for the time period
during which warrants are deferred, and shall notify the
Superintendent of Public Instruction and the Director of Finance on
or before June 1, 2012. Subject to the approval of the Director of
Finance, a charter school that did not receive payments for July
2012, August 2012, and October 2012 may seek a hardship waiver to
receive scheduled payments from the Controller if payments are
deferred in March 2013. To apply for a hardship waiver, the
chartering authority, in consultation with the county superintendent
of schools, shall certify that the deferral of March 2013 warrants
will result in the charter school being unable to meet its
expenditure obligations for the time period during which warrants are
deferred, and shall notify the Superintendent of Public Instruction
and the Director of Finance on or before January 4, 2013. The
criteria, as applicable, set forth in statute and regulations to
qualify a school district for an emergency apportionment shall be
used to make the certifications specified in this subparagraph. 

   (C) Subject to the approval of the Director of Finance, in order
for a school district to receive scheduled payments from the
Controller if payments are deferred, the county superintendent of
schools shall certify to the Superintendent of Public Instruction and
the Director of Finance on or before June 1, 2012, that the deferral
of warrants will result in the school district being unable to meet
its expenditure obligations for the time period during which warrants
are deferred. Subject to the approval of the Director of Finance, a
school district that did not receive payments for July 2012, August
2012, and October 2012 may seek a hardship waiver to receive
scheduled payments from the Controller if payments are deferred in
March 2013. To apply for a hardship waiver, the county superintendent
of schools shall certify to the Superintendent of Public Instruction
and to the Director of Finance on or before January 4, 2013, that
the deferral of March 2013 warrants will result in the school
district being unable to meet its expenditure obligations for the
time period during which warrants are deferred. The criteria, as
applicable, set forth in statute and regulations to qualify a school
district for an emergency apportionment shall be used to make the
certifications specified in this subparagraph.  
   (D) Notwithstanding Section 16325.5, payments of the March 2013
deferral to the county offices of education, school districts, and
charter schools, shall be made no later than April 29, 2013. 
   (3) Of the amount appropriated from the General Fund to the
University of California for the 2010-11  and  
,  2011-12  , and 2012-13  fiscal years, 
excluding transfers and rental payments that support lease-revenue
bonds,  payments made by the state to the University of
California shall not exceed one-twelfth of the annual appropriation
for each month from July through April. Any remaining appropriation
balance may be paid to the University of California thereafter with
no limitations.
   (4) Notwithstanding Sections 84320, 84321, and 84321.5 of the
Education Code and any other law that governs the regulations adopted
by the Chancellor of the California Community Colleges to disburse
funds  for the 2011-12 fiscal year  , two hundred million
dollars ($200,000,000) and one hundred million dollars ($100,000,000)
from the payment of apportionments to districts pursuant to Sections
84320, 84321, and 84321.5 of the Education Code for July and March,
respectively, shall be deferred to October and May, respectively.
Notwithstanding this paragraph and subject to the approval of the
Director of Finance, the Controller shall issue warrants pursuant to
Sections 84320, 84321, and 84321.5 of the Education Code that include
the full amount of the apportionment payments for the months of July
or March, or both, for a community college for which the Chancellor
of the California Community Colleges determines, in consultation with
the Director of Finance, on or before June 1 of the preceding fiscal
year, that the deferral of warrants pursuant to this paragraph will
present an imminent threat to the fiscal integrity and security of
the community college. 
   (5) For the 2012-13 fiscal year, notwithstanding Sections 84320,
84321, and 84321.5 of the Education Code and any other law that
governs the regulations adopted by the Chancellor of the California
Community Colleges to disburse funds, from the payment of
apportionments to districts pursuant to Sections 84320, 84321, and
84321.5 of the Education Code, the following deferrals shall be made
within the same fiscal year: one hundred fifty million dollars
($150,000,000) from July to December, inclusive, fifty million
dollars ($50,000,000) from September to January, inclusive, and one
hundred million dollars ($100,000,000) from October to January,
inclusive. Notwithstanding this paragraph and subject to the approval
of the Director of Finance, the Controller shall issue warrants
pursuant to Sections 84320, 84321, and 84321.5 of the Education Code
that include the full amount of the apportionment payments for the
months of July, September, or October, or any combination of those
months, for a community college for which the Chancellor of the
California Community Colleges determines, in consultation with the
Director of Finance, on or before June 1 of the preceding fiscal
year, that the deferral of warrants pursuant to this paragraph will
present an imminent threat to the fiscal integrity and security of
the community college.  
   (5) 
    (6)  Of the amount appropriated from the General Fund to
the California State University for the 2010-11  and
  ,  2011-12  , and 2012-13  fiscal years,
 excluding   transfers and rental payments that support
lease-revenue bonds,  payments made by the state to the
California State University shall not exceed one-twelfth of the
annual appropriation for each month from July through April. Any
remaining appropriation balance may be paid to the California State
University thereafter with no limitations. 
   (6) 
    (7)  The 2010-11  and the   , 
2011-12  , and 2012-13  cash management plans described in
Sections 16325 and 16325.5 may include deferrals in state payments
for specific programs that are disbursed to cities, counties, and
other public entities not addressed elsewhere in this section.
Deferral of payments by the state to cities, counties, and other
public entities not addressed elsewhere in this section shall be as
follows:
   (A) Payments shall be deferred as specified in Section 16325.5 per
the specific program.
   (B) Payments shall be limited to one billion dollars
($1,000,000,000) for all programs that affect cities, counties, and
other public entities not addressed elsewhere in this section at any
given point in time.
   (C) A maximum of three deferrals per specific program may be made
during the fiscal year.
   (D) The state shall not defer any payments to a county with a
population less than 50,000, or a city within a county with a
population less than 50,000.
   (E) Payments to local governments may be deferred for social
services programs and Mental Health Services Act (Proposition 63)
programs. 
   (7) 
    (8)  In addition to implementing the payment schedule
described in paragraph  (5)   (6)  , the
Director of Finance may at any time during the 2010-11  and
the   ,  2011-12  , and 2012-13  fiscal
years defer payment of General Fund moneys, in a cumulative amount
not to exceed two hundred fifty million dollars ($250,000,000)
annually, appropriated to the California State University. Payment of
the amount deferred shall be made in the final week of April.
   (b) Limits on payment deferrals specified in subparagraphs (A) and
(C) of paragraph  (6)   (7)  of
subdivision (a) shall not apply to payments to the Mental Health
Services Act (Proposition 63) programs.
   (c) Upon the Controller's receipt of a letter from the executive
officer of the Administrative Office of the Courts, or any other
executive officer representing cities or counties, the state may
defer payments to the entity or entities that the executive officer
represents as specified in the letter even if the specified amounts
exceed the deferrals authorized in this section or elsewhere in law.
   (d) This section shall become inoperative on September 1, 
2012,   2013,  and, as of January 1, 
2013,   2014,  is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 
2013,   2014,  deletes or extends the dates on
which it becomes inoperative and is repealed.
   SEC. 5.    Section 16428 of the   Government
Code   is amended to read: 
   16428.  Money in the fund may be invested and reinvested in any
securities described in Section 16430 or deposited in banks as
provided in Chapter 4 (commencing with Section 16500) of this part or
deposited in savings and loan associations as provided in Chapter
4.5 (commencing with Section 16600) of this part. The department
shall determine the amount of money available for investment or
deposit and shall so arrange the investment or deposit program that
funds will be available for the immediate payment of any court order
or decree. The Treasurer shall invest or make deposits in accordance
with these determinations.
   All revenues earned from investment or deposit of fund moneys
shall be deposited in the fund. After first deducting therefrom the
amount payable to the Treasurer for investment services rendered and
the amount payable to the department for administrative services
rendered, the department shall apportion as of June 30 and December
31 of each year the remainder of such revenues earned and deposited
in the fund during the six calendar months ending with such dates.
There shall be apportioned and credited to each litigation deposit in
the fund during such six-month period, an amount directly
proportionate to the total deposits in the fund and the length of
time such deposits remained therein. The amounts so apportioned shall
be paid to the party receiving the deposit. The cost of
administrative services rendered shall be determined by the
department in a manner approved by the Department of Finance. The
amounts payable to the department and to the Treasurer shall be
transferred to the General Fund and accounted as reimbursements to
their respective appropriations. 
   Notwithstanding any other provision of law, the Controller may use
money in the fund for cash flow loans to the General Fund as
provided in Sections 16310 and 16381. 
   SEC. 6.    The sum of one thousand dollars ($1,000)
is hereby appropriated to the Controller from the General Fund for
administrative costs associated with this act. 
   SEC. 7.    This act is a bill providing for
appropriations related to the Budget Bill within the meaning of
subdivision (e) of Section 12 of Article IV of the California
Constitution, has been identified as related to the budget in the
Budget Bill, and shall take effect immediately.  
  SECTION 1.    It is the intent of the Legislature
to enact statutory changes relating to the Budget Act of 2011.