BILL NUMBER: AB 106	CHAPTERED
	BILL TEXT

	CHAPTER  32
	FILED WITH SECRETARY OF STATE  JUNE 29, 2011
	APPROVED BY GOVERNOR  JUNE 28, 2011
	PASSED THE SENATE  JUNE 10, 2011
	PASSED THE ASSEMBLY  JUNE 15, 2011
	AMENDED IN SENATE  JUNE 9, 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 to amend Sections 1179.3, 1771, 1771.7, 1771.8, 1776.3,
1783.3, 1785, 1793.13, 1793.23, 1793.50, 1793.60, 127280, 128680,
128700, 128705, 128738, 128740, 128745, 128750, 128760, 128765,
128770, 128775, 128785, 128810, 129010, 129015, and 129100 of, and to
repeal Sections 1179.2, 1179.5, 1777, 1777.2, 1777.4, 127670,
127671, 128695, 128710, 128715, 128720, and 128725 of, the Health and
Safety Code, and to amend Sections 10618.6, 11265.2, 11320.15,
11320.3, 11322.63, 11329.5, 11334.8, 11364, 11387, 11405, 11454,
11454.2, 11461, 11462.04, 11465, 11466.23, 11487, 12200.03, 12301.03,
12301.05, 12309.1, 14132.97, 16120.05, 16121, 16519.5, and 17021 of,
to add Sections 11487.1, 14021.30, and 14021.31 to, and to repeal
Sections 11450.025 and 16121.01 of, the Welfare and Institutions
Code, relating to human services, making an appropriation therefor,
to take effect immediately, bill related to the budget.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 106, Committee on Budget. Human services.
   Existing law requires the establishment of the Office of Rural
Health, or an alternative organizational structure, in one of the
departments of the California Health and Human Services Agency, and
requires the office or alternative organizational structure to serve
as a key information and referral source to promote coordinated
planning for the delivery of health services in rural California.
Under existing law, various functions relating to rural health
activities are performed by the Rural Health Policy Council. Existing
law also requires the establishment of an interdepartmental Task
Force on Rural Health, to coordinate rural health policy development
and program operations and develop a strategic plan for rural health,
as specified.
   This bill, operative January 1, 2012, would eliminate the Rural
Health Policy Council and the interdepartmental task force, and would
transfer designated duties of these entities to the Office of
Statewide Health Planning and Development.
   Existing law establishes, until January 1, 2013, the Continuing
Care Advisory Committee within the State Department of Social
Services and requires the committee to act in an advisory capacity to
the department on matters relating to continuing care contracts.
   This bill, operative January 1, 2012, would delete the committee
and make conforming changes.
   Existing law creates the Health Care Quality Improvement and Cost
Containment Commission, as specified, to research and recommend
appropriate and timely strategies for promoting high-quality care and
containing health care costs.
   Existing law creates the California Health Policy and Data
Advisory Commission, as specified. Under existing law, the commission
has prescribed functions and duties, including advising the Office
of Statewide Health Planning and Development, on issues relating to
health facility and other provider data.
   This bill, operative January 1, 2012, would eliminate the Health
Care Quality Improvement and Cost Containment Commission. The bill
also would eliminate California the Health Policy and Data Advisory
Commission and would transfer its duties to the office, or to an
entity designated by the office, as prescribed. The bill would make
various related technical and conforming changes.
   Existing law requires a county welfare department to request a
consumer disclosure, pursuant to federal law, on behalf of a youth in
a foster care placement in the county, when the youth reaches his or
her 16th birthday, in order to ascertain whether the youth has been
the victim of identity theft, as specified.
   This bill would suspend implementation of the above provisions
until July 1, 2013.
   Existing federal law provides for allocation of federal funds
through the federal Temporary Assistance for Needy Families (TANF)
block grant program to eligible states. Existing law provides for the
California Work Opportunity and Responsibility to Kids (CalWORKs)
program under which, through a combination of state and county funds
and federal funds received through the TANF program, each county
provides cash assistance and other benefits to qualified low-income
families. Under existing law, operative as specified, a parent or
caretaker relative is not eligible for CalWORKs aid after he or she
has received CalWORKs aid for a cumulative total of 48 months, or
TANF aid from any state for a cumulative total of 60 months.
   This bill would impose a 48-month limit on the receipt of aid,
regardless of whether received under the CalWORKs program or another
state's TANF program, and would make various conforming changes.
   Existing law requires recipients of aid under the CalWORKs program
who are under 19 years of age who are pregnant or custodial parents
to participate in certain educational programs, which are referred to
as the Cal-Learn Program. Under existing law, a Cal-Learn Program
participant is entitled to monetary supplements or bonuses, as
specified, for maintaining satisfactory educational progress, and
successfully completing high school or a California high school
equivalency examination. Existing law suspends operation of the
Cal-Learn Program from July 1, 2011, to June 30, 2012, inclusive,
except as specified. Under existing law, certain pregnant women with
no other children, who are eligible for the Cal-Learn Program, are
also eligible for CalWORKs aid, but only when the Cal-Learn Program
is operative.
   This bill, notwithstanding existing law, would authorize certain
pregnant women, who are determined to be eligible for aid for
purposes of participating in the Cal-Learn Program prior to July 1,
2011, to continue to receive aid during the suspension of the
Cal-Learn Program, as specified. Because moneys are continuously
appropriated from the General Fund to pay for the state's share of
CalWORKs program costs, by expanding eligibility, this bill would
make an appropriation. In addition, by increasing county duties, the
bill would impose a state-mandated local program.
   Existing law provides that when aid under the CalWORKs program is
repaid to the state, the state is entitled to the entire amount of
the aid repaid, except where federal and county funds were paid, in
which case the federal government remains entitled to a proportionate
share of the amount received or recovered and the county remains
entitled to its proportionate share, except for county funds received
or recovered during the 2011-12 fiscal year, which are retained by
the state.
   This bill would restrict the above repayment procedures to
situations when the aid repaid to the state is by means of child
support collections. The bill would require that when any other aid
is repaid to, or recovered by, a county, the state and the federal
government would be entitled to a share of the amount received or
recovered, proportionate to the amount of state or federal funds
paid.
   Existing law, as of July 1, 2011, reduces the amount of the
CalWORKs computed aid grant in a child-only assistance unit by 5%
commencing with the 61st, 73rd, and 85th months on aid, respectively,
for a total 15% reduction.
   This bill would eliminate the above-described grant reduction, and
make conforming changes. The bill would authorize the department to
implement this change through all-county letters or similar
instructions pending the adoption of regulations.
   Existing law makes specified findings and declarations with
respect to the effect of decreased funding for CalWORKS for the
2009-10 to 2011-12 fiscal years, inclusive. In connection with this
decreased funding, existing law extends certain exemptions from
months counted as a month of receipt of aid, and allows counties to
redirect funding between specified employment assistance and
substance abuse treatment programs during the specified fiscal years.
Existing law authorizes a county to revise a specified
welfare-to-work exemption in order to implement the county's portion
of this funding reduction.
   This bill would revise the amount of the funding reduction
applicable to the 2011-12 fiscal year, as specified, and would delete
the county authority to revise the above-referenced welfare-to-work
exemption.
   Existing law provides for the In-Home Supportive Services (IHSS)
program, under which, either through employment by the recipient, or
by or through contract by the county, qualified aged, blind, and
disabled persons receive services enabling them to remain in their
own homes. Counties are responsible for the administration of the
IHSS program. Under the Medi-Cal program, similar services are
provided to eligible individuals, with these services known as
personal care option services. Under existing law, operative as
specified, if the Department of Finance makes a specified
determination, the State Department of Social Services is required to
implement a reduction in authorized IHSS program service hours, in
accordance with prescribed procedures. Existing law authorizes an
individual who believes that he or she is at serious risk of
out-of-home placement, unless all or part of the reduction is
restored, to apply for an IHSS Care Supplement to restore the reduced
hours.
   This bill would recast and revise the provisions relating to the
IHSS service hours reduction and IHSS Care Supplement, including
exempting certain IHSS recipients, who also receive other designated
public health and social services, from the service hour reduction,
and making other technical and conforming changes to these
provisions.
   This bill would revise the definition of "waiver personal care
services" received by certain recipients under the Medi-Cal program,
to delete the requirement prohibiting waiver personal care services
from replacing any hours of services authorized or reduced pursuant
to other designated service categories.
   Existing law requires an IHSS applicant or recipient to obtain a
certification from a licensed health care professional, as specified,
as a condition of receiving those services. Existing law authorizes
the receipt of services prior to certification under certain
circumstances, including when deterioration of the recipient's health
or mental health is likely to result in eviction, homelessness, or a
hazardous living environment.
   This bill would revise the circumstances under which services may
be authorized prior to receipt of certification, to delete the
authority described above, and to authorize, instead, provision of
services based upon a county determination that there is a risk of
out-of-home placement.
   Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Care Services and
under which qualified low-income persons receive health care
benefits. The Medi-Cal program is, in part, governed and funded by
federal Medicaid provisions.
   Existing law provides for the Medi-Cal Drug Treatment Program
(Drug Medi-Cal), under which each county enters into contracts with
the State Department of Alcohol and Drug Programs for the provision
of various drug treatment services to Medi-Cal recipients, or the
department directly arranges for the provision of these services if a
county elects not to do so.
   This bill would declare the intent of the Legislature to transfer
Drug Medi-Cal functions from the State Department of Alcohol and Drug
Programs to the State Department of Health Care Services, effective
July 1, 2012, in accordance with an administrative and programmatic
transition plan developed by the State Department of Health Care
Services and the State Department of Alcohol and Drug Programs, as
required in the bill.
   Existing law requires the State Department of Social Services, in
consultation with county welfare agencies, to implement a pilot
program to establish a unified resource family approval process to
replace the existing multiple processes for licensing foster family
homes, approving relatives and nonrelative extended family members as
foster care providers, and approving adoptive families, as
specified. Existing law authorizes the pilot program to continue
through the end of the 2010-11 fiscal year, or the end of the 3rd
fiscal year following the date that funds are made available for its
implementation, whichever is later.
   This bill would extend authority for implementation of the
resource family approval pilot program through the end of the 5th
fiscal year following the date that funds are made available for that
purpose. The bill also would suspend implementation of the pilot
program until January 1, 2013.
   Existing law provides for the out-of-home placement of children
who are unable to remain in the custody and care of their parent or
parents, and provides for a range of child welfare, foster care, and
adoption assistance services for which these children may be
eligible.
   Existing law, through the Kinship Guardianship Assistance Payment
Program (Kin-GAP), which is a part of the CalWORKs program, provides
aid on behalf of eligible children who are placed in the home of a
relative caretaker. The program is funded by state and county funding
and available federal funds. Existing law, effective on the date
that the Director of Social Services executes a prescribed
declaration, revises the Kin-GAP Program by repealing the existing
program and enacting similar provisions. Existing law requires as a
condition of receiving payments under the revised Kin-GAP Program
provisions, that a county welfare agency, probation department, or
Indian tribe, as applicable, negotiate and enter into a written,
binding kinship guardianship assistance agreement with the relative
guardian of an eligible child, as prescribed.
   Existing law, the Aid to Families with Dependent Children-Foster
Care (AFDC-FC) program, provides for payments to group home providers
at a per child per month rate, and in accordance with prescribed
rate classification levels, for the care and supervision of the
AFDC-FC child placed with the provider. Existing law requires a
county to annually redetermine AFDC-FC eligibility, as specified.
   Existing law provides for the Adoption Assistance Program (AAP),
to be established and administered by the State Department of Social
Services or the county, for the purpose of benefiting children
residing in foster homes by providing the stability and security of
permanent homes. The AAP provides for the payment by the department
and counties of cash assistance to eligible families that adopt
eligible children, and bases the amount of the payment on the needs
of the child and the resources of the family to meet those needs.
   Existing law prohibits the establishment of a new group home rate
or change to an existing rate under the AFDC-FC program for a
prescribed period, and repeals this prohibition on January 1, 2012.
   This bill would extend the prohibition on the establishment of a
new or changed AFDC-FC group home rate until January 1, 2013.
   Existing law declares the intent of the Legislature to comply with
specified federal law relating to the overpayment of federal foster
care and adoption assistance payments, under the AFDC-FC program,
Kin-GAP program, and AAP. Existing law requires these funds to be
repaid by the state and counties under designated circumstances.
Existing law excludes certain amounts from this repayment
requirement, and with respect to those amounts not excluded, requires
repayment to be based on a 40% state, 60% county sharing ratio.
   This bill would delete the existing sharing ratio, and instead
would apply specified separate sharing ratios for repayment of
federal AFDC-FC, Kin-GAP, and AAP funds, respectively.
   This bill, with respect to agreements on or after July 1, 2011,
would revise Kin-GAP, AFDC-FC, and AAP rates, as prescribed, and
would annually adjust these rates by the percentage changes in the
California Necessities Index, and make related changes.  The bill
would authorize implementation of these provisions through all-county
letters or similar instructions from the department until
regulations are adopted, as specified
   Moneys from the General Fund are continuously appropriated for
Kin-GAP, AFDC-FC, and AAP, as prescribed.
   Because this bill, by increasing Kin-GAP, AFDC-FC, and AAP rates,
and by revising existing sharing ratios for repayment of certain
overpayments, would result in an increase in the state's level of
participation in these programs in certain cases, this bill would
make an appropriation.
   Existing law requires the State Department of Social Services to
implement a single statewide Child Welfare Services Case Management
System (CWS/CMS) to administer and evaluate the state's child welfare
services and foster care programs.
   This bill would require the department, in partnership with the
Office of Systems Integration and designated stakeholders, to perform
various activities regarding the effectiveness and operation of the
CWS/CMS, and to report on these activities to the Legislature, by
January 10, 2012.
   This bill would require the State Department of Social Services,
in consultation with designated stakeholders, to develop a new
ratesetting methodology for public authority administrative costs,
effective for the 2012-13 fiscal year, and thereafter.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
   This bill would declare that it is to take effect immediately as a
bill providing for appropriations related to the Budget Bill.
   Appropriation: yes.


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

  SECTION 1.  Section 1179.2 of the Health and Safety Code is
repealed.
  SEC. 2.  Section 1179.3 of the Health and Safety Code is amended to
read:
   1179.3.  (a) (1)  The Office of Statewide Health Planning and
Development shall develop and administer a competitive grants program
for projects located in rural areas of California.
   (2) The office shall define "rural area" for the purposes of this
section after receiving public input and upon recommendation of the
Interdepartmental Rural Health Coordinating Committee and the Rural
Health Programs Liaison.
   (3) The purpose of the grants program shall be to fund innovative,
collaborative, cost-effective, and efficient projects that pertain
to the delivery of health and medical services in rural areas of the
state.
   (4) The office shall develop and establish uses for the funds to
fund special projects that alleviate problems of access to quality
health care in rural areas and to compensate public and private
health care providers associated with direct delivery of patient
care. The funds shall be used for medical and hospital care and
treatment of patients who cannot afford to pay for services and for
whom payment will not be made through private or public programs.
   (5) The office shall administer the funds appropriated by the
Legislature for purposes of this section. Entities eligible for these
funds shall include rural health providers served by the programs
operated by the office, the State Department of Alcohol and Drug
Programs, the Emergency Medical Services Authority, the State
Department of Health Care Services, the State Department of Public
Health, the State Department of Mental Health, and the Managed Risk
Medical Insurance Board. The grant funds shall be used to expand
existing services or establish new services and shall not be used to
supplant existing levels of service. Funds appropriated by the
Legislature for this purpose may be expended in the fiscal year of
the appropriation or the subsequent fiscal year.
   (b) The Office of Statewide Health Planning and Development shall
establish the criteria and standards for eligibility to be used in
requests for proposals or requests for application, the application
review process, determining the maximum amount and number of grants
to be awarded, preference and priority of projects, compliance
monitoring, and the measurement of outcomes achieved after receiving
comment from the public at a meeting held pursuant to the
Bagley-Keene Open Meeting Act (Article 9 (commencing with Section
11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the
Government Code).
   (c) The Office of Statewide Health Planning and Development shall
make information regarding the status of the funded projects
available at the public meetings described in subdivision (b).
  SEC. 3.  Section 1179.5 of the Health and Safety Code is repealed.
  SEC. 4.  Section 1771 of the Health and Safety Code is amended to
read:
   1771.  Unless the context otherwise requires, the definitions in
this section govern the interpretation of this chapter.
   (a) (1) "Affiliate" means any person, corporation, limited
liability company, business trust, trust, partnership, unincorporated
association, or other legal entity that directly or indirectly
controls, is controlled by, or is under common control with, a
provider or applicant.
   (2) "Affinity group" means a grouping of entities sharing a common
interest, philosophy, or connection (e.g., military officers,
religion).
   (3) "Annual report" means the report each provider is required to
file annually with the department, as described in Section 1790.
   (4) "Applicant" means any entity, or combination of entities, that
submits and has pending an application to the department for a
permit to accept deposits and a certificate of authority.
   (5) "Assisted living services" includes, but is not limited to,
assistance with personal activities of daily living, including
dressing, feeding, toileting, bathing, grooming, mobility, and
associated tasks, to help provide for and maintain physical and
psychosocial comfort.
   (6) "Assisted living unit" means the living area or unit within a
continuing care retirement community that is specifically designed to
provide ongoing assisted living services.
   (7) "Audited financial statement" means financial statements
prepared in accordance with generally accepted accounting principles
including the opinion of an independent certified public accountant,
and notes to the financial statements considered customary or
necessary to provide full disclosure and complete information
regarding the provider's financial statements, financial condition,
and operation.
   (b) (reserved)
   (c) (1) "Cancel" means to destroy the force and effect of an
agreement or continuing care contract.
   (2) "Cancellation period" means the 90-day period, beginning when
the resident physically moves into the continuing care retirement
community, during which the resident may cancel the continuing care
contract, as provided in Section 1788.2.
   (3) "Care" means nursing, medical, or other health-related
services, protection or supervision, assistance with the personal
activities of daily living, or any combination of those services.
   (4) "Cash equivalent" means certificates of deposit and United
States treasury securities with a maturity of five years or less.
   (5) "Certificate" or "certificate of authority" means the
certificate issued by the department, properly executed and bearing
the State Seal, authorizing a specified provider to enter into one or
more continuing care contracts at a single specified continuing care
retirement community.
   (6) "Condition" means a restriction, specific action, or other
requirement imposed by the department for the initial or continuing
validity of a permit to accept deposits, a provisional certificate of
authority, or a certificate of authority. A condition may limit the
circumstances under which the provider may enter into any new deposit
agreement or contract, or may be imposed as a condition precedent to
the issuance of a permit to accept deposits, a provisional
certificate of authority, or a certificate of authority.
   (7) "Consideration" means some right, interest, profit, or benefit
paid, transferred, promised, or provided by one party to another as
an inducement to contract. Consideration includes some forbearance,
detriment, loss, or responsibility, that is given, suffered, or
undertaken by a party as an inducement to another party to contract.
   (8) "Continuing care contract" means a contract that includes a
continuing care promise made, in exchange for an entrance fee, the
payment of periodic charges, or both types of payments. A continuing
care contract may consist of one agreement or a series of agreements
and other writings incorporated by reference.
   (9) "Continuing care promise" means a promise, expressed or
implied, by a provider to provide one or more elements of care to an
elderly resident for the duration of his or her life or for a term in
excess of one year. Any such promise or representation, whether part
of a continuing care contract, other agreement, or series of
agreements, or contained in any advertisement, brochure, or other
material, either written or oral, is a continuing care promise.
   (10) "Continuing care retirement community" means a facility
located within the State of California where services promised in a
continuing care contract are provided. A distinct phase of
development approved by the department may be considered to be the
continuing care retirement community when a project is being
developed in successive distinct phases over a period of time. When
the services are provided in residents' own homes, the homes into
which the provider takes those services are considered part of the
continuing care retirement community.
   (11) "Control" means directing or causing the direction of the
financial management or the policies of another entity, including an
operator of a continuing care retirement community, whether by means
of the controlling entity's ownership interest, contract, or any
other involvement. A parent entity or sole member of an entity
controls a subsidiary entity provider for a continuing care
retirement community if its officers, directors, or agents directly
participate in the management of the subsidiary entity or in the
initiation or approval of policies that affect the continuing care
retirement community's operations, including, but not limited to,
approving budgets or the administrator for a continuing care
retirement community.
   (d) (1) "Department" means the State Department of Social
Services.
   (2) "Deposit" means any transfer of consideration, including a
promise to transfer money or property, made by a depositor to any
entity that promises or proposes to promise to provide continuing
care, but is not authorized to enter into a continuing care contract
with the potential depositor.
   (3) "Deposit agreement" means any agreement made between any
entity accepting a deposit and a depositor. Deposit agreements for
deposits received by an applicant prior to the department's release
of funds from the deposit escrow account shall be subject to the
requirements described in Section 1780.4.
   (4) "Depository" means a bank or institution that is a member of
the Federal Deposit Insurance Corporation or a comparable deposit
insurance program.
   (5) "Depositor" means any prospective resident who pays a deposit.
Where any portion of the consideration transferred to an applicant
as a deposit or to a provider as consideration for a continuing care
contract is transferred by a person other than the prospective
resident or a resident, that third-party transferor shall have the
same cancellation or refund rights as the prospective resident or
resident for whose benefit the consideration was transferred.
   (6) "Director" means the Director of Social Services.
   (e) (1) "Elderly" means an individual who is 60 years of age or
older.
   (2) "Entity" means an individual, partnership, corporation,
limited liability company, and any other form for doing business.
Entity includes a person, sole proprietorship, estate, trust,
association, and joint venture.
   (3) "Entrance fee" means the sum of any initial, amortized, or
deferred transfer of consideration made or promised to be made by, or
on behalf of, a person entering into a continuing care contract for
the purpose of ensuring care or related services pursuant to that
continuing care contract or as full or partial payment for the
promise to provide care for the term of the continuing care contract.
Entrance fee includes the purchase price of a condominium,
cooperative, or other interest sold in connection with a promise of
continuing care. An initial, amortized, or deferred transfer of
consideration that is greater in value than 12 times the monthly care
fee shall be presumed to be an entrance fee.
   (4) "Equity" means the value of real property in excess of the
aggregate amount of all liabilities secured by the property.
   (5) "Equity interest" means an interest held by a resident in a
continuing care retirement community that consists of either an
ownership interest in any part of the continuing care retirement
community property or a transferable membership that entitles the
holder to reside at the continuing care retirement community.
   (6) "Equity project" means a continuing care retirement community
where residents receive an equity interest in the continuing care
retirement community property.
   (7) "Equity securities" shall refer generally to large and
midcapitalization corporate stocks that are publicly traded and
readily liquidated for cash, and shall include shares in mutual funds
that hold portfolios consisting predominantly of these stocks and
other qualifying assets, as defined by Section 1792.2. Equity
securities shall also include other similar securities that are
specifically approved by the department.
   (8) "Escrow agent" means a bank or institution, including, but not
limited to, a title insurance company, approved by the department to
hold and render accountings for deposits of cash or cash
equivalents.
   (f) "Facility" means any place or accommodation where a provider
provides or will provide a resident with care or related services,
whether or not the place or accommodation is constructed, owned,
leased, rented, or otherwise contracted for by the provider.
   (g) (reserved)
   (h) (reserved)
   (i) (1) "Inactive certificate of authority" means a certificate
that has been terminated under Section 1793.8.
   (2) "Investment securities" means any of the following:
   (A) Direct obligations of the United States, including obligations
issued or held in book-entry form on the books of the United States
Department of the Treasury or obligations the timely payment of the
principal of, and the interest on, which are fully guaranteed by the
United States.
   (B) Obligations, debentures, notes, or other evidences of
indebtedness issued or guaranteed by any of the following:
   (i) The Federal Home Loan Bank System.
   (ii) The Export-Import Bank of the United States.
   (iii) The Federal Financing Bank.
   (iv) The Government National Mortgage Association.
   (v) The Farmer's Home Administration.
   (vi) The Federal Home Loan Mortgage Corporation of the Federal
Housing Administration.
   (vii) Any agency, department, or other instrumentality of the
United States if the obligations are rated in one of the two highest
rating categories of each rating agency rating those obligations.
   (C) Bonds of the State of California or of any county, city and
county, or city in this state, if rated in one of the two highest
rating categories of each rating agency rating those bonds.
   (D) Commercial paper of finance companies and banking institutions
rated in one of the two highest categories of each rating agency
rating those instruments.
   (E) Repurchase agreements fully secured by collateral security
described in subparagraph (A) or (B), as evidenced by an opinion of
counsel, if the collateral is held by the provider or a third party
during the term of the repurchase agreement, pursuant to the terms of
the agreement, subject to liens or claims of third parties, and has
a market value, which is determined at least every 14 days, at least
equal to the amount so invested.
   (F) Long-term investment agreements, which have maturity dates in
excess of one year, with financial institutions, including, but not
limited to, banks and insurance companies or their affiliates, if the
financial institution's paying ability for debt obligations or
long-term claims or the paying ability of a related guarantor of the
financial institution for these obligations or claims, is rated in
one of the two highest rating categories of each rating agency rating
those instruments, or if the short-term investment agreements are
with the financial institution or the related guarantor of the
financial institution, the long-term or short-term debt obligations,
whichever is applicable, of which are rated in one of the two highest
long-term or short-term rating categories, of each rating agency
rating the bonds of the financial institution or the related
guarantor, provided that if the rating falls below the two highest
rating categories, the investment agreement shall allow the provider
the option to replace the financial institution or the related
guarantor of the financial institution or shall provide for the
investment securities to be fully collateralized by investments
described in subparagraph (A), and, provided further, if so
collateralized, that the provider has a perfected first security lien
on the collateral, as evidenced by an opinion of counsel and the
collateral is held by the provider.
   (G) Banker's acceptances or certificates of deposit of, or time
deposits in, any savings and loan association that meets any of the
following criteria:
   (i) The debt obligations of the savings and loan association, or
in the case of a principal bank, of the bank holding company, are
rated in one of the two highest rating categories of each rating
agency rating those instruments.
   (ii) The certificates of deposit or time deposits are fully
insured by the Federal Deposit Insurance Corporation.
   (iii) The certificates of deposit or time deposits are secured at
all times, in the manner and to the extent provided by law, by
collateral security described in subparagraph (A) or (B) with a
market value, valued at least quarterly, of no less than the original
amount of moneys so invested.
   (H) Taxable money market government portfolios restricted to
obligations issued or guaranteed as to payment of principal and
interest by the full faith and credit of the United States.
   (I) Obligations the interest on which is excluded from gross
income for federal income tax purposes and money market mutual funds
whose portfolios are restricted to these obligations, if the
obligations or mutual funds are rated in one of the two highest
rating categories by each rating agency rating those obligations.
   (J) Bonds that are not issued by the United States or any federal
agency, but that are listed on a national exchange and that are rated
at least "A" by Moody's Investors Service, or the equivalent rating
by Standard and Poor's Corporation or Fitch Investors Service.
   (K) Bonds not listed on a national exchange that are traded on an
over-the-counter basis, and that are rated at least "Aa" by Moody's
Investors Service or "AA" by Standard and Poor's Corporation or Fitch
Investors Service.
   (j) (reserved)
   (k) (reserved)
   (l) "Life care contract" means a continuing care contract that
includes a promise, expressed or implied, by a provider to provide or
pay for routine services at all levels of care, including acute care
and the services of physicians and surgeons, to the extent not
covered by other public or private insurance benefits, to a resident
for the duration of his or her life. Care shall be provided under a
life care contract in a continuing care retirement community having a
comprehensive continuum of care, including a skilled nursing
facility, under the ownership and supervision of the provider on or
adjacent to the premises. No change may be made in the monthly fee
based on level of care. A life care contract shall also include
provisions to subsidize residents who become financially unable to
pay their monthly care fees.
   (m) (1) "Monthly care fee" means the fee charged to a resident in
a continuing care contract on a monthly or other periodic basis for
current accommodations and services including care, board, or
lodging. Periodic entrance fee payments or other prepayments shall
not be monthly care fees.
   (2) "Monthly fee contract" means a continuing care contract that
requires residents to pay monthly care fees.
   (n) "Nonambulatory person" means a person who is unable to leave a
building unassisted under emergency conditions in the manner
described by Section 13131.
   (o) (reserved)
   (p) (1) "Per capita cost" means a continuing care retirement
community's operating expenses, excluding depreciation, divided by
the average number of residents.
   (2) "Periodic charges" means fees paid by a resident on a periodic
basis.
   (3) "Permanent closure" means the voluntary or involuntary
termination or forfeiture, as specified in subdivisions (a), (b),
(g), (h), and (i) of Section 1793.7, of a provider's certificate of
authority or license, or another action that results in the permanent
relocation of residents. Permanent closure does not apply in the
case of a natural disaster or other event out of the provider's
control.
   (4) "Permit to accept deposits" means a written authorization by
the department permitting an applicant to enter into deposit
agreements regarding a single specified continuing care retirement
community.
   (5) "Prepaid contract" means a continuing care contract in which
the monthly care fee, if any, may not be adjusted to cover the actual
cost of care and services.
   (6) "Preferred access" means that residents who have previously
occupied a residential living unit have a right over other persons to
any assisted living or skilled nursing beds that are available at
the community.
   (7) "Processing fee" means a payment to cover administrative costs
of processing the application of a depositor or prospective
resident.
   (8) "Promise to provide one or more elements of care" means any
expressed or implied representation that one or more elements of care
will be provided or will be available, such as by preferred access.
   (9) "Proposes" means a representation that an applicant or
provider will or intends to make a future promise to provide care,
including a promise that is subject to a condition, such as the
construction of a continuing care retirement community or the
acquisition of a certificate of authority.
   (10) "Provider" means an entity that provides continuing care,
makes a continuing care promise, or proposes to promise to provide
continuing care. "Provider" also includes any entity that controls an
entity that provides continuing care, makes a continuing care
promise, or proposes to promise to provide continuing care. The
department shall determine whether an entity controls another entity
for purposes of this article. No homeowner's association,
cooperative, or condominium association may be a provider.
   (11) "Provisional certificate of authority" means the certificate
issued by the department, properly executed and bearing the State
Seal, under Section 1786. A provisional certificate of authority
shall be limited to the specific continuing care retirement community
and number of units identified in the applicant's application.
   (q) (reserved)
   (r) (1) "Refund reserve" means the reserve a provider is required
to maintain, as provided in Section 1792.6.
   (2) "Refundable contract" means a continuing care contract that
includes a promise, expressed or implied, by the provider to pay an
entrance fee refund or to repurchase the transferor's unit,
membership, stock, or other interest in the continuing care
retirement community when the promise to refund some or all of the
initial entrance fee extends beyond the resident's sixth year of
residency. Providers that enter into refundable contracts shall be
subject to the refund reserve requirements of Section 1792.6. A
continuing care contract that includes a promise to repay all or a
portion of an entrance fee that is conditioned upon reoccupancy or
resale of the unit previously occupied by the resident shall not be
considered a refundable contract for purposes of the refund reserve
requirements of Section 1792.6, provided that this conditional
promise of repayment is not referred to by the applicant or provider
as a "refund."
   (3) "Resale fee" means a levy by the provider against the proceeds
from the sale of a transferor's equity interest.
   (4) "Reservation fee" refers to consideration collected by an
entity that has made a continuing care promise or is proposing to
make this promise and has complied with Section 1771.4.
   (5) "Resident" means a person who enters into a continuing care
contract with a provider, or who is designated in a continuing care
contract to be a person being provided or to be provided services,
including care, board, or lodging.
   (6) "Residential care facility for the elderly" means a housing
arrangement as defined by Section 1569.2.
   (7) "Residential living unit" means a living unit in a continuing
care retirement community that is not used exclusively for assisted
living services or nursing services.
   (8) "Residential temporary relocation" means the relocation of one
or more residents, except in the case of a natural disaster that is
out of the provider's control, from one or more residential living
units, assisted living units, skilled nursing units, or a wing,
floor, or entire continuing care retirement community building, due
to a change of use or major repairs or renovations. A residential
temporary relocation shall mean a relocation pursuant to this
subdivision that lasts for a period of at least nine months but that
does not exceed 18 months without the written agreement of the
resident.
   (s) (reserved)
   (t) (1) "Termination" means the ending of a continuing care
contract as provided for in the terms of the continuing care
contract.
   (2) "Transfer trauma" means death, depression, or regressive
behavior, that is caused by the abrupt and involuntary transfer of an
elderly resident from one home to another and results from a loss of
familiar physical environment, loss of well-known neighbors,
attendants, nurses and medical personnel, the stress of an abrupt
break in the small routines of daily life, or the loss of visits from
friends and relatives who may be unable to reach the new facility.
   (3) "Transferor" means a person who transfers, or promises to
transfer, consideration in exchange for care and related services
under a continuing care contract or proposed continuing care
contract, for the benefit of another. A transferor shall have the
same rights to cancel and obtain a refund as the depositor under the
deposit agreement or the resident under a continuing care contract.
  SEC. 5.  Section 1771.7 of the Health and Safety Code is amended to
read:
   1771.7.  (a) No resident of a continuing care retirement community
shall be deprived of any civil or legal right, benefit, or privilege
guaranteed by law, by the California Constitution, or by the United
States Constitution, solely by reason of status as a resident of a
community. In addition, because of the discretely different character
of residential living unit programs that are a part of continuing
care retirement communities, this section shall augment Chapter 3.9
(commencing with Section 1599), Sections 72527 and 87572 of Title 22
of the California Code of Regulations, and other applicable state and
federal law and regulations.
   (b) A prospective resident shall have the right to visit each of
the different care levels and to inspect assisted living and skilled
nursing home licensing reports including, but not limited to, the
most recent inspection reports and findings of complaint
investigations covering a period of no less than two years, prior to
signing a continuing care contract.
   (c) All residents in residential living units shall have all of
the following rights:
   (1) To live in an attractive, safe, and well maintained physical
environment.
   (2) To live in an environment that enhances personal dignity,
maintains independence, and encourages self-determination.
   (3) To participate in activities that meet individual physical,
intellectual, social, and spiritual needs.
      (4) To expect effective channels of communication between
residents and staff, and between residents and the administration or
provider's governing body.
   (5) To receive a clear and complete written contract that
establishes the mutual rights and obligations of the resident and the
continuing care retirement community.
   (6) To manage his or her financial affairs.
   (7) To be assured that all donations, contributions, gifts, or
purchases of provider-sponsored financial products shall be
voluntary, and may not be a condition of acceptance or of ongoing
eligibility for services.
   (8) To maintain and establish ties to the local community.
   (9) To organize and participate freely in the operation of
independent resident organizations and associations.
   (d) A continuing care retirement community shall maintain an
environment that enhances the residents' self-determination and
independence. The provider shall do both of the following:
   (1)  Encourage the formation of a resident association by
interested residents who may elect a governing body. The provider
shall provide space and post notices for meetings, and provide
assistance in attending meetings for those residents who request it.
In order to promote a free exchange of ideas, at least part of each
meeting shall be conducted without the presence of any continuing
care retirement community personnel. The association may, among other
things, make recommendations to management regarding resident issues
that impact the residents' quality of life, quality of care,
exercise of rights, safety and quality of the physical environment,
concerns about the contract, fiscal matters, or other issues of
concern to residents. The management shall respond, in writing, to a
written request or concern of the resident association within 20
working days of receiving the written request or concern. Meetings
shall be open to all residents to attend as well as to present
issues. Executive sessions of the governing body shall be attended
only by the governing body.
   (2) Establish policies and procedures that promote the sharing of
information, dialogue between residents and management, and access to
the provider's governing body. The provider shall biennially conduct
a resident satisfaction survey that shall be made available to the
resident association or its governing body, or, if neither exists, to
a committee of residents at least 14 days prior to the next
semiannual meeting of residents and the governing board of the
provider required by subdivision (c) of Section 1771.8. A copy of the
survey shall be posted in a conspicuous location at each facility.
   (e) In addition to any statutory or regulatory bill of rights
required to be provided to residents of residential care facilities
for the elderly or skilled nursing facilities, the provider shall
provide a copy of the bill of rights prescribed by this section to
each resident at the time or before the resident signs a continuing
care contract, and at any time when the resident is proposed to be
moved to a different level of care.
   (f) Each continuing care retirement community shall prominently
post in areas accessible to the residents and visitors a notice that
a copy of rights applicable to residents pursuant to this section and
any governing regulation issued by the Continuing Care Contracts
Branch of the State Department of Social Services is available upon
request from the provider. The notice shall also state that the
residents have a right to file a complaint with the Continuing Care
Contracts Branch for any violation of those rights and shall contain
information explaining how a complaint may be filed, including the
telephone number and address of the Continuing Care Contracts Branch.

   (g) The resident has the right to freely exercise all rights
pursuant to this section, in addition to political rights, without
retaliation by the provider.
   (h) The department may, upon receiving a complaint of a violation
of this section, request a copy of the policies and procedures along
with documentation on the conduct and findings of any
self-evaluations.
   (i) Failure to comply with this section shall be grounds for the
imposition of conditions on, suspension of, or revocation of the
provisional certificate of authority or certificate of authority
pursuant to Section 1793.21.
   (j) Failure to comply with this section constitutes a violation of
residents' rights. Pursuant to Section 1569.49 of the Health and
Safety Code, the department shall impose and collect a civil penalty
of not more than one hundred fifty dollars ($150) per violation upon
a continuing care retirement community that violates a right
guaranteed by this section.
  SEC. 6.  Section 1771.8 of the Health and Safety Code is amended to
read:
   1771.8.  (a) The Legislature finds and declares all of the
following:
   (1) The residents of continuing care retirement communities have a
unique and valuable perspective on the operations of and services
provided in the community in which they live.
   (2) Resident input into decisions made by the provider is an
important factor in creating an environment of cooperation, reducing
conflict, and ensuring timely response and resolution to issues that
may arise.
   (3) Continuing care retirement communities are strengthened when
residents know that their views are heard and respected.
   (b) The Legislature encourages continuing care retirement
communities to exceed the minimum resident participation requirements
established by this section by, among other things, the following:
   (1) Encouraging residents to form a resident association, and
assisting the residents, the resident association, and its governing
body to keep informed about the operation of the continuing care
retirement community.
   (2) Encouraging residents of a continuing care retirement
community or their elected representatives to select residents to
participate as board members of the governing body of the provider.
   (3) Quickly and fairly resolving any dispute, claim, or grievance
arising between a resident and the continuing care retirement
community.
   (c) The governing body of a provider, or the designated
representative of the provider, shall hold, at a minimum, semiannual
meetings with the residents of the continuing care retirement
community, or the resident association or its governing body, for the
purpose of the free discussion of subjects including, but not
limited to, income, expenditures, and financial trends and issues as
they apply to the continuing care retirement community and proposed
changes in policies, programs, and services. Nothing in this section
precludes a provider from taking action or making a decision at any
time, without regard to the meetings required under this subdivision.

   (d) At least 30 days prior to the implementation of any increase
in the monthly care fee, the designated representative of the
provider shall convene a meeting, to which all residents shall be
invited, for the purpose of discussing the reasons for the increase,
the basis for determining the amount of the increase, and the data
used for calculating the increase. This meeting may coincide with the
semiannual meetings provided for in subdivision (c). At least 14
days prior to the meeting to discuss any increase in the monthly care
fee, the provider shall make available to each resident or resident
household comparative data showing the budget for the upcoming year,
the current year's budget, and actual and projected expenses for the
current year, and a copy shall be posted in a conspicuous location at
each facility.
   (e) The governing body of a provider or the designated
representative of the provider shall provide residents with at least
14 days' advance notice of each meeting provided for in subdivisions
(c) and (d), and shall permit residents attending the meeting to
present issues orally and in writing. The governing body of a
provider or the designated representative of the provider shall post
the notice of, and the agenda for, the meeting in a conspicuous place
in the continuing care retirement community at least 14 days prior
to the meeting. The governing body of a provider or the designated
representative of the provider shall make available to residents of
the continuing care retirement community upon request the agenda and
accompanying materials at least seven days prior to the meeting.
   (f) Each provider shall make available to the resident association
or its governing body, or if neither exists, to a committee of
residents, a financial statement of activities for that facility
comparing actual costs to budgeted costs broken down by expense
category, not less than semiannually, and shall consult with the
resident association or its governing body, or, if neither exists,
with a committee of residents, during the annual budget planning
process. The effectiveness of consultations during the annual budget
planning process shall be evaluated at a minimum every two years by
the continuing care retirement community administration. The
evaluation, including any policies adopted relating to cooperation
with residents, shall be made available to the resident association
or its governing body, or, if neither exists, to a committee of
residents at least 14 days prior to the next semiannual meeting of
residents and the provider's governing body provided for in
subdivision (c), and a copy of the evaluation shall be posted in a
conspicuous location at each facility.
   (g) Each provider shall, within 10 days after the annual report
required pursuant to Section 1790 is submitted to the department,
provide, at a central and conspicuous location in the community, a
copy of the annual report, including the multifacility statement of
activities, and including a copy of the annual audited financial
statement, but excluding personal confidential information.
   (h) Each provider shall maintain, as public information, available
upon request to residents, prospective residents, and the public,
minutes of the board of director's meetings and shall retain these
records for at least three years from the date the records were filed
or issued.
   (i) The governing body of a provider that is not part of a
multifacility organization with more than one continuing care
retirement community in the state shall accept at least one resident
of the continuing care retirement community it operates to
participate as a nonvoting resident representative to the provider's
governing body.
   (j) In a multifacility organization having more than one
continuing care retirement community in the state, the governing body
of the multifacility organization shall elect either to have at
least one nonvoting resident representative to the provider's
governing body for each California-based continuing care retirement
community the provider operates or to have a resident-elected
committee composed of representatives of the residents of each
California-based continuing care retirement community that the
provider operates select or nominate at least one nonvoting resident
representative to the provider's governing body for every three
California-based continuing care retirement communities or fraction
thereof that the provider operates. If a multifacility organization
elects to have one representative for every three communities that
the provider operates, the provider shall provide to the president of
the residents association of each of the communities that do not
have a resident representative, the same notice of board meetings,
board packets, minutes, and other materials as the resident
representative. At the reasonable discretion of the provider,
information related to litigation, personnel, competitive advantage,
or confidential information that is not appropriate to disclose, may
be withheld.
   (k) In order to encourage innovative and alternative models of
resident involvement, a resident selected pursuant to subdivision (i)
to participate as a resident representative to the provider's
governing body may, at the option of the resident association, be
selected in any one of the following ways:
   (1) By a majority vote of the resident association of a provider
or by a majority vote of a resident-elected committee of residents of
a multifacility organization.
   (2) If no resident association exists, any resident may organize a
meeting of the majority of the residents of the continuing care
retirement community to select or nominate residents to represent
them before the governing body.
   (3) Any other method designated by the resident association.
   (l)  The resident association, or organizing resident, or in the
case of a multifacility organization, the resident-elected committee
of residents, shall give residents of the continuing care retirement
community at least 30 days' advance notice of the meeting to select a
resident representative and shall post the notice in a conspicuous
place at the continuing care retirement community.
   (m) (1) Except as provided in subdivision (n), the resident
representative shall receive the same notice of board meetings, board
packets, minutes, and other materials as members and shall be
permitted to attend, speak, and participate in all meetings of the
board.
   (2) Resident representatives may share information from board
meetings with other residents, unless the information is confidential
or doing so would violate fiduciary duties to the provider. In
addition, a resident representative shall be permitted to attend
meetings of the board committee or committees that review the annual
budget of the facility or facilities and recommend increases in
monthly care fees. The resident shall receive the same notice of
committee meetings, information packets, minutes, and other materials
as committee members, and shall be permitted to attend, speak at,
and participate in, committee meetings. Resident representatives
shall perform their duties in good faith and with such care,
including reasonable inquiry, as an ordinarily prudent person in a
like position would use under similar circumstances.
   (n) Notwithstanding subdivision (m), the governing body may
exclude resident representatives from its executive sessions and from
receiving board materials to be discussed during executive session.
However, resident representatives shall be included in executive
sessions and shall receive all board materials to be discussed during
executive sessions related to discussions of the annual budgets,
increases in monthly care fees, indebtedness, and expansion of new
and existing continuing care retirement communities.
   (o) The provider shall pay all reasonable travel costs for the
resident representative.
   (p) The provider shall disclose in writing the extent of resident
involvement with the board to prospective residents.
   (q) Nothing in this section prohibits a provider from exceeding
the minimum resident participation requirements of this section by,
for example, having more resident meetings or more resident
representatives to the board than required or by having one or more
residents on the provider's governing body who are selected with the
active involvement of residents.
   (r) On or before April 1, 2003, the department shall do all of the
following:
   (1) Make recommendations to the Legislature as to whether any
changes in current law regarding resident representation to the board
is needed.
   (2) Provide written guidelines available to residents and
providers that address issues related to board participation,
including rights and responsibilities, and that provide guidance on
the extent to which resident representatives who are not voting
members of the board have a duty of care, loyalty, and obedience to
the provider and the extent to which providers can classify
information as confidential and not subject to disclosure by resident
representatives to other residents.
  SEC. 7.  Section 1776.3 of the Health and Safety Code is amended to
read:
   1776.3.  (a) The Continuing Care Contracts Branch of the
department shall enter and review each continuing care retirement
community in the state at least once every three years to augment the
branch's assessment of the provider's financial soundness.
   (b) During its facility visits, the branch shall consider the
condition of the facility, whether the facility is operating in
compliance with applicable state law, and whether the provider is
performing the services it has specified in its continuing care
contracts.
   (c) The branch shall issue guidelines that require each provider
to adopt a comprehensive disaster preparedness plan, update that plan
at least every three years, submit a copy to the department, and
make copies available to residents in a prominent location in each
continuing care retirement community facility.
   (d) (1) The branch shall respond within 15 business days to
residents' rights, service-related, and financially related
complaints by residents, and shall furnish to residents upon request
and within 15 business days any document or report filed with the
department by a continuing care provider, except documents protected
by privacy laws.
   (2) The provider shall disclose any citation issued by the
department pursuant to Section 1793.6 in its disclosure statement to
residents as updated annually, and shall post a notice of the
citation in a conspicuous location in the facility. The notice shall
include a statement indicating that residents may obtain additional
information regarding the citation from the provider and the
department.
  SEC. 8.  Section 1777 of the Health and Safety Code is repealed.
  SEC. 9.  Section 1777.2 of the Health and Safety Code is repealed.
  SEC. 10.  Section 1777.4 of the Health and Safety Code is repealed.

  SEC. 11.  Section 1783.3 of the Health and Safety Code is amended
to read:
   1783.3.  (a) In order to seek a release of escrowed funds, the
applicant shall petition in writing to the department and certify to
each of the following:
   (1) The construction of the proposed continuing care retirement
community or phase is at least 50 percent completed.
   (2) At least 10 percent of the total of each applicable entrance
fee has been received and placed in escrow for at least 60 percent of
the total number of residential living units. Any unit for which a
refund is pending may not be counted toward that 60-percent
requirement.
   (3) Deposits made with cash equivalents have been either converted
into, or substituted with, cash or held for transfer to the
provider. A cash equivalent deposit may be held for transfer to the
provider, if all of the following conditions exist:
   (A) Conversion of the cash equivalent instrument would result in a
penalty or other substantial detriment to the depositor.
   (B) The provider and the depositor have a written agreement
stating that the cash equivalent will be transferred to the provider,
without conversion into cash, when the deposit escrow is released to
the provider under this section.
   (C) The depositor is credited the amount equal to the value of the
cash equivalent.
   (4) The applicant's average performance over any six-month period
substantially equals or exceeds its financial and marketing
projections approved by the department, for that period.
   (5) The applicant has received a commitment for any permanent
mortgage loan or other long-term financing.
   (b) The department shall instruct the escrow agent to release to
the applicant all deposits in the deposit escrow account when all of
the following requirements have been met:
   (1) The department has confirmed the information provided by the
applicant pursuant to subdivision (a).
   (2) The department has determined that there has been substantial
compliance with projected annual financial statements that served as
a basis for issuance of the permit to accept deposits.
   (3) The applicant has complied with all applicable licensing
requirements in a timely manner.
   (4) The applicant has obtained a commitment for any permanent
mortgage loan or other long-term financing that is satisfactory to
the department.
   (5) The applicant has complied with any additional reasonable
requirements for release of funds placed in the deposit escrow
accounts, established by the department under Section 1785.
   (c) The escrow agent shall release the funds held in escrow to the
applicant only when the department has instructed it to do so in
writing.
   (d) When an application describes different phases of construction
that will be completed and commence operating at different times,
the department may apply the 50-percent construction completion
requirement to any one or group of phases requested by the applicant,
provided the phase or group of phases is shown in the applicant's
projections to be economically viable.
  SEC. 12.  Section 1785 of the Health and Safety Code is amended to
read:
   1785.  (a) If, at any time prior to issuance of a certificate of
authority, the applicant's average performance over any six-month
period does not substantially equal or exceed the applicant's
projections for that period, the department may take any of the
following actions:
   (1) Cancel the permit to accept deposits and require that all
funds in escrow be returned to depositors immediately.
   (2) Increase the required percentages of construction completed,
units reserved, or entrance fees to be deposited as required under
Sections 1782, 1783.3, 1786, and 1786.2.
   (3) Increase the reserve requirements under this chapter.
   (b) Prior to taking any actions specified in subdivision (a), the
department shall give the applicant an opportunity to submit a
feasibility study from a consultant in the area of continuing care,
approved by the department, to determine whether in his or her
opinion the proposed continuing care retirement community is still
viable, and if so, to submit a plan of correction. The department
shall determine if the plan is acceptable.
   (c) In making its determination, the department shall take into
consideration the overall performance of the proposed continuing care
retirement community to date.
   (d) If deposits have been released from escrow, the department may
further require the applicant to reopen the escrow as a condition of
receiving any further entrance fee payments from depositors or
residents.
   (e) The department may require the applicant to notify all
depositors and, if applicable, all residents, of any actions required
by the department under this section.
  SEC. 13.  Section 1793.13 of the Health and Safety Code is amended
to read:
   1793.13.  (a) The department may require a provider to submit a
financial plan, if either of the following applies:
   (1) A provider fails to file a complete annual report as required
by Section 1790.
   (2) The department has reason to believe that the provider is
insolvent, is in imminent danger of becoming insolvent, is in a
financially unsound or unsafe condition, or that its condition is
such that it may otherwise be unable to fully perform its obligations
pursuant to continuing care contracts.
   (b) A provider shall submit its financial plan to the department
within 60 days following the date of the department's request. The
financial plan shall explain how and when the provider will rectify
the problems and deficiencies identified by the department.
   (c) The department shall approve or disapprove the plan within 30
days of its receipt.
   (d) If the plan is approved, the provider shall immediately
implement the plan.
   (e) If the plan is disapproved, or if it is determined that the
plan is not being fully implemented, the department may consult with
its financial consultants to develop a corrective action plan at the
provider's expense, or require the provider to obtain new or
additional management capability approved by the department to solve
its difficulties. A reasonable period, as determined by the
department, shall be allowed for the reorganized management to
develop a plan which, subject to the approval of the department, will
reasonably assure that the provider will meet its responsibilities
under the law.
  SEC. 14.  Section 1793.23 of the Health and Safety Code is amended
to read:
   1793.23.  (a) If the department conditions, suspends, or revokes
any permit to accept deposits, provisional certificate of authority,
or certificate of authority issued pursuant to this chapter, the
provider shall have a right of appeal to the department. The
proceedings shall be conducted in accordance with Chapter 5
(commencing with Section 11500) of Part 1 of Division 3 of Title 2 of
the Government Code, and the department shall have all of the powers
granted therein. A suspension, condition, or revocation shall remain
in effect until completion of the proceedings in favor of the
provider. In all proceedings conducted in accordance with this
section, the standard of proof to be applied shall be by a
preponderance of the evidence.
   (b) The department may, upon finding of changed circumstances,
remove a suspension or condition.
  SEC. 15.  Section 1793.50 of the Health and Safety Code is amended
to read:
   1793.50.  (a) The department may petition the superior court for
an order appointing a qualified administrator to operate a continuing
care retirement community, and thereby mitigate imminent crisis
situations where elderly residents could lose support services or be
moved without proper preparation, in any of the following
circumstances:
   (1) The provider is insolvent or in imminent danger of becoming
insolvent.
   (2) The provider is in a financially unsound or unsafe condition.
   (3) The provider has failed to establish or has substantially
depleted the reserves required by this chapter.
   (4) The provider has failed to submit a plan, as specified in
Section 1793.13, the department has not approved the plan submitted
by the provider, the provider has not fully implemented the plan, or
the plan has not been successful.
   (5) The provider is unable to fully perform its obligations
pursuant to continuing care contracts.
   (6) The residents are otherwise placed in serious jeopardy.
   (b) The administrator may only assume the operation of the
continuing care retirement community in order to accomplish one or
more of the following: rehabilitate the provider to enable it fully
to perform its continuing care contract obligations; implement a plan
of reorganization acceptable to the department; facilitate the
transition where another provider assumes continuing care contract
obligations; or facilitate an orderly liquidation of the provider.
   (c) With each petition, the department shall include a request for
a temporary restraining order to prevent the provider from disposing
of or transferring assets pending the hearing on the petition.
                                                     (d) The provider
shall be served with a copy of the petition, together with an order
to appear and show cause why management and possession of the
provider's continuing care retirement community or assets should not
be vested in an administrator.
   (e) The order to show cause shall specify a hearing date, which
shall be not less than five nor more than 10 days following service
of the petition and order to show cause on the provider.
   (f) Petitions to appoint an administrator shall have precedence
over all matters, except criminal matters, in the court.
   (g) At the time of the hearing, the department shall advise the
provider and the court of the name of the proposed administrator.
   (h) If, at the conclusion of the hearing, including such oral
evidence as the court may consider, the court finds that any of the
circumstances specified in subdivision (a) exist, the court shall
issue an order appointing an administrator to take possession of the
property of the provider and to conduct the business thereof,
enjoining the provider from interfering with the administrator in the
conduct of the rehabilitation, and directing the administrator to
take steps toward removal of the causes and conditions which have
made rehabilitation necessary, as the court may direct.
   (i) The order shall include a provision directing the issuance of
a notice of the rehabilitation proceedings to the residents at the
continuing care retirement community and to other interested persons
as the court may direct.
   (j) The court may permit the provider to participate in the
continued operation of the continuing care retirement community
during the pendency of any appointments ordered pursuant to this
section and shall specify in the order the nature and scope of the
participation.
   (k) The court shall retain jurisdiction throughout the
rehabilitation proceeding and may issue further orders as it deems
necessary to accomplish the rehabilitation or orderly liquidation of
the continuing care retirement community in order to protect the
residents of the continuing care retirement community.
  SEC. 16.  Section 1793.60 of the Health and Safety Code is amended
to read:
   1793.60.  (a) If at any time the department determines that
further efforts to rehabilitate the provider would not be in the best
interest of the residents or prospective residents, or would not be
economically feasible, the department may apply to the court for an
order of liquidation and dissolution or may apply for other
appropriate relief for dissolving the property and bringing to
conclusion its business affairs.
   (b) Upon issuance of an order directing the liquidation or
dissolution of the provider, the department shall revoke the provider'
s provisional certificate of authority or certificate of authority.
  SEC. 17.  Section 127280 of the Health and Safety Code is amended
to read:
   127280.  (a) Every health facility licensed pursuant to Chapter 2
(commencing with Section 1250) of Division 2, except a health
facility owned and operated by the state, shall each year be charged
a fee established by the office consistent with the requirements of
this section.
   (b) Commencing in calendar year 2004, every freestanding
ambulatory surgery clinic as defined in Section 128700, shall each
year be charged a fee established by the office consistent with the
requirements of this section.
   (c) The fee structure shall be established each year by the office
to produce revenues equal to the appropriation made in the annual
Budget Act or another statute to pay for the functions required to be
performed by the office pursuant to this chapter, Article 2
(commencing with Section 127340) of Chapter 2, or Chapter 1
(commencing with Section 128675) of Part 5, and to pay for any other
health-related programs administered by the office. The fee shall be
due on July 1 and delinquent on July 31 of each year.
   (d) The fee for a health facility that is not a hospital, as
defined in subdivision (c) of Section 128700, shall be not more than
0.035 percent of the gross operating cost of the facility for the
provision of health care services for its last fiscal year that ended
on or before June 30 of the preceding calendar year.
   (e) The fee for a hospital, as defined in subdivision (c) of
Section 128700, shall be not more than 0.035 percent of the gross
operating cost of the facility for the provision of health care
services for its last fiscal year that ended on or before June 30 of
the preceding calendar year.
   (f) (1) The fee for a freestanding ambulatory surgery clinic shall
be established at an amount equal to the number of ambulatory
surgery data records submitted to the office pursuant to Section
128737 for encounters in the preceding calendar year multiplied by
not more than fifty cents ($0.50).
   (2) (A) For the calendar year 2004 only, a freestanding ambulatory
surgery clinic shall estimate the number of records it will file
pursuant to Section 128737 for the calendar year 2004 and shall
report that number to the office by March 12, 2004. The estimate
shall be as accurate as possible. The fee in the calendar year 2004
shall be established initially at an amount equal to the estimated
number of records reported multiplied by fifty cents ($0.50) and
shall be due on July 1 and delinquent on July 31, 2004.
   (B) The office shall compare the actual number of records filed by
each freestanding clinic for the calendar year 2004 pursuant to
Section 128737 with the estimated number of records reported pursuant
to subparagraph (A). If the actual number reported is less than the
estimated number reported, the office shall reduce the fee of the
clinic for calendar year 2005 by the amount of the difference
multiplied by fifty cents ($0.50). If the actual number reported
exceeds the estimated number reported, the office shall increase the
fee of the clinic for calendar year 2005 by the amount of the
difference multiplied by fifty cents ($0.50) unless the actual number
reported is greater than 120 percent of the estimated number
reported, in which case the office shall increase the fee of the
clinic for calendar year 2005 by the amount of the difference, up to
and including 120 percent of the estimated number, multiplied by
fifty cents ($0.50), and by the amount of the difference in excess of
120 percent of the estimated number multiplied by one dollar ($1).
   (g) There is hereby established the California Health Data and
Planning Fund within the office for the purpose of receiving and
expending fee revenues collected pursuant to this chapter.
   (h) Any amounts raised by the collection of the special fees
provided for by subdivisions (d), (e), and (f) that are not required
to meet appropriations in the Budget Act for the current fiscal year
shall remain in the California Health Data and Planning Fund and
shall be available to the office in succeeding years when
appropriated by the Legislature in the annual Budget Act or another
statute, for expenditure under the provisions of this chapter,
Article 2 (commencing with Section 127340) of Chapter 2, and Chapter
1 (commencing with Section 128675) of Part 5, or for any other
health-related programs administered by the office, and shall reduce
the amount of the special fees that the office is authorized to
establish and charge.
   (i) (1) No health facility liable for the payment of fees required
by this section shall be issued a license or have an existing
license renewed unless the fees are paid. A new, previously
unlicensed, health facility shall be charged a pro rata fee to be
established by the office during the first year of operation.
   (2) The license of any health facility, against which the fees
required by this section are charged, shall be revoked, after notice
and hearing, if it is determined by the office that the fees required
were not paid within the time prescribed by subdivision (c).
   (j) This section shall become operative on January 1, 2002.
  SEC. 18.  Section 127670 of the Health and Safety Code is repealed.

  SEC. 19.  Section 127671 of the Health and Safety Code is repealed.

  SEC. 20.  Section 128680 of the Health and Safety Code is amended
to read:
   128680.  The Legislature hereby finds and declares that:
   (a) Significant changes have taken place in recent years in the
health care marketplace and in the manner of reimbursement to health
facilities by government and private third-party payers for the
services they provide.
   (b) These changes have permitted the state to reevaluate the need
for, and the manner of data collection from health facilities by the
various state agencies and commissions.
   (c) It is the intent of the Legislature that as a result of this
reevaluation that the data collection function be consolidated in a
single state agency. It is the further intent of the Legislature that
the single state agency only collect that data from health
facilities that are essential. The data should be collected, to the
extent practical on consolidated, multipurpose report forms for use
by all state agencies.
   (d) It is the further intent of the Legislature to eliminate the
California Health Facilities Commission, the State Advisory Health
Council, and the California Health Policy and Data Advisory
Commission, and to consolidate data collection and planning functions
within the office.
   (e) It is the Legislature's further intent that the review of the
data that the state collects be an ongoing function. The office shall
annually review this data for need and shall revise, add, or delete
items as necessary. The office shall consult with affected state
agencies and the affected industry when adding or eliminating data
items. However, the office shall neither add nor delete data items to
the Hospital Discharge Abstract Data Record or the quarterly reports
without prior authorizing legislation, unless specifically required
by federal law or judicial decision.
   (f) The Legislature recognizes that the authority for the
California Health Facilities Commission is scheduled to expire
January 1, 1986. It is the intent of the Legislature, by the
enactment of this chapter, to continue the uniform system of
accounting and reporting established by the commission and required
for use by health facilities. It is also the intent of the
Legislature to continue an appropriate, cost-disclosure program.
  SEC. 21.  Section 128695 of the Health and Safety Code is repealed.

  SEC. 22.  Section 128700 of the Health and Safety Code is amended
to read:
   128700.  As used in this chapter, the following terms mean:
   (a) "Ambulatory surgery procedures" mean those procedures
performed on an outpatient basis in the general operating rooms,
ambulatory surgery rooms, endoscopy units, or cardiac catheterization
laboratories of a hospital or a freestanding ambulatory surgery
clinic.
   (b) "Emergency department" means, in a hospital licensed to
provide emergency medical services, the location in which those
services are provided.
   (c) "Encounter" means a face-to-face contact between a patient and
the provider who has primary responsibility for assessing and
treating the condition of the patient at a given contact and
exercises independent judgment in the care of the patient.
   (d) "Freestanding ambulatory surgery clinic" means a surgical
clinic that is licensed by the state under paragraph (1) of
subdivision (b) of Section 1204.
   (e) "Health facility" or "health facilities" means all health
facilities required to be licensed pursuant to Chapter 2 (commencing
with Section 1250) of Division 2.
   (f) "Hospital" means all health facilities except skilled nursing,
intermediate care, and congregate living health facilities.
   (g) "Office" means the Office of Statewide Health Planning and
Development.
   (h) "Risk-adjusted outcomes" means the clinical outcomes of
patients grouped by diagnoses or procedures that have been adjusted
for demographic and clinical factors.
  SEC. 23.  Section 128705 of the Health and Safety Code is amended
to read:
   128705.  On and after January 1, 1986, any reference in this code
to the Advisory Health Council or the California Health Policy and
Data Advisory Commission shall be deemed a reference to the office.
  SEC. 24.  Section 128710 of the Health and Safety Code is repealed.

  SEC. 25.  Section 128715 of the Health and Safety Code is repealed.

  SEC. 26.  Section 128720 of the Health and Safety Code is repealed.

  SEC. 27.  Section 128725 of the Health and Safety Code is repealed.

  SEC. 28.  Section 128738 of the Health and Safety Code is amended
to read:
   128738.  (a) The office shall allow and provide for, in accordance
with appropriate regulations, additions or deletions to the patient
level data elements listed in subdivision (g) of Section 128735,
Section 128736, and Section 128737, to meet the purposes of this
chapter.
   (b) Prior to any additions or deletions, all of the following
shall be considered:
   (1) Utilization of sampling to the maximum extent possible.
   (2) Feasibility of collecting data elements.
   (3) Costs and benefits of collection and submission of data.
   (4) Exchange of data elements as opposed to addition of data
elements.
   (c) The office shall add no more than a net of 15 elements to each
data set over any five-year period. Elements contained in the
uniform claims transaction set or uniform billing form required by
the Health Insurance Portability and Accountability Act of 1996 (42
U.S.C. Sec. 300gg) shall be exempt from the 15-element limit.
   (d) The office, in order to minimize costs and administrative
burdens, shall consider the total number of data elements required
from hospitals and freestanding ambulatory surgery clinics, and
optimize the use of common data elements.
  SEC. 29.  Section 128740 of the Health and Safety Code is amended
to read:
   128740.  (a) Commencing with the first calendar quarter of 1992,
the following summary financial and utilization data shall be
reported to the office by each hospital within 45 days of the end of
every calendar quarter. Adjusted reports reflecting changes as a
result of audited financial statements may be filed within four
months of the close of the hospital's fiscal or calendar year. The
quarterly summary financial and utilization data shall conform to the
uniform description of accounts as contained in the Accounting and
Reporting Manual for California Hospitals and shall include all of
the following:
   (1) Number of licensed beds.
   (2) Average number of available beds.
   (3) Average number of staffed beds.
   (4) Number of discharges.
   (5) Number of inpatient days.
   (6) Number of outpatient visits.
   (7) Total operating expenses.
   (8) Total inpatient gross revenues by payer, including Medicare,
Medi-Cal, county indigent programs, other third parties, and other
payers.
   (9) Total outpatient gross revenues by payer, including Medicare,
Medi-Cal, county indigent programs, other third parties, and other
payers.
   (10) Deductions from revenue in total and by component, including
the following: Medicare contractual adjustments, Medi-Cal contractual
adjustments, and county indigent program contractual adjustments,
other contractual adjustments, bad debts, charity care, restricted
donations and subsidies for indigents, support for clinical teaching,
teaching allowances, and other deductions.
   (11) Total capital expenditures.
   (12) Total net fixed assets.
   (13) Total number of inpatient days, outpatient visits, and
discharges by payer, including Medicare, Medi-Cal, county indigent
programs, other third parties, self-pay, charity, and other payers.
   (14) Total net patient revenues by payer including Medicare,
Medi-Cal, county indigent programs, other third parties, and other
payers.
   (15) Other operating revenue.
   (16) Nonoperating revenue net of nonoperating expenses.
   (b) Hospitals reporting pursuant to subdivision (d) of Section
128760 may provide the items in paragraphs (7), (8), (9), (10), (14),
(15), and (16) of subdivision (a) on a group basis, as described in
subdivision (d) of Section 128760.
   (c) The office shall make available at cost, to any person, a hard
copy of any hospital report made pursuant to this section and in
addition to hard copies, shall make available at cost, a computer
tape of all reports made pursuant to this section within 105 days of
the end of every calendar quarter.
   (d) The office shall adopt by regulation guidelines for the
identification, assessment, and reporting of charity care services.
In establishing the guidelines, the office shall consider the
principles and practices recommended by professional health care
industry accounting associations for differentiating between charity
services and bad debts. The office shall further conduct the onsite
validations of health facility accounting and reporting procedures
and records as are necessary to assure that reported data are
consistent with regulatory guidelines.
   This section shall become operative January 1, 1992.
  SEC. 30.  Section 128745 of the Health and Safety Code is amended
to read:
   128745.  (a) Commencing July 1993, and annually thereafter, the
office shall publish risk-adjusted outcome reports in accordance with
the following schedule:
                                Procedures and
Publication    Period            Conditions
    Date        Covered            Covered
  July 1993     1988-90               3
  July 1994     1989-91               6
  July 1995     1990-92               9


   Reports for subsequent years shall include conditions and
procedures and cover periods as appropriate.
   (b) The procedures and conditions required to be reported under
this chapter shall be divided among medical, surgical, and obstetric
conditions or procedures and shall be selected by the office. The
office shall publish the risk-adjusted outcome reports for surgical
procedures by individual hospital and individual surgeon unless the
office in consultation with medical specialists in the relevant area
of practice determines that it is not appropriate to report by
individual surgeon. The office, in consultation with the clinical
panel established by Section 128748 and medical specialists in the
relevant area of practice, may decide to report nonsurgical
procedures and conditions by individual physician when it is
appropriate. The selections shall be in accordance with all of the
following criteria:
   (1) The patient discharge abstract contains sufficient data to
undertake a valid risk adjustment. The risk adjustment report shall
ensure that public hospitals and other hospitals serving primarily
low-income patients are not unfairly discriminated against.
   (2) The relative importance of the procedure and condition in
terms of the cost of cases and the number of cases and the
seriousness of the health consequences of the procedure or condition.

   (3) Ability to measure outcome and the likelihood that care
influences outcome.
   (4) Reliability of the diagnostic and procedure data.
   (c) (1) In addition to any other established and pending reports,
on or before July 1, 2002, the office shall publish a risk-adjusted
outcome report for coronary artery bypass graft surgery by hospital
for all hospitals opting to participate in the report. This report
shall be updated on or before July 1, 2003.
   (2) In addition to any other established and pending reports,
commencing July 1, 2004, and every year thereafter, the office shall
publish risk-adjusted outcome reports for coronary artery bypass
graft surgery for all coronary artery bypass graft surgeries
performed in the state. In each year, the reports shall compare
risk-adjusted outcomes by hospital, and in every other year, by
hospital and cardiac surgeon. Upon the recommendation of the clinical
panel established by Section 128748 based on statistical and
technical considerations, information on individual hospitals and
surgeons may be excluded from the reports.
   (3) Unless otherwise recommended by the clinical panel established
by Section 128748, the office shall collect the same data used for
the most recent risk-adjusted model developed for the California
Coronary Artery Bypass Graft Mortality Reporting Program. Upon
recommendation of the clinical panel, the office may add any clinical
data elements included in the Society of Thoracic Surgeons'
database. Prior to any additions from the Society of Thoracic
Surgeons' database, the following factors shall be considered:
   (A) Utilization of sampling to the maximum extent possible.
   (B) Exchange of data elements as opposed to addition of data
elements.
   (4) Upon recommendation of the clinical panel, the office may add,
delete, or revise clinical data elements, but shall add no more than
a net of six elements not included in the Society of Thoracic
Surgeons' database, to the data set over any five-year period. Prior
to any additions or deletions, all of the following factors shall be
considered:
   (A) Utilization of sampling to the maximum extent possible.
   (B) Feasibility of collecting data elements.
   (C) Costs and benefits of collection and submission of data.
   (D) Exchange of data elements as opposed to addition of data
elements.
   (5) The office shall collect the minimum data necessary for
purposes of testing or validating a risk-adjusted model for the
coronary artery bypass graft report.
   (6) Patient medical record numbers and any other data elements
that the office believes could be used to determine the identity of
an individual patient shall be exempt from the disclosure
requirements of the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code).
   (d) The annual reports shall compare the risk-adjusted outcomes
experienced by all patients treated for the selected conditions and
procedures in each California hospital during the period covered by
each report, to the outcomes expected. Outcomes shall be reported in
the five following groupings for each hospital:
   (1) "Much higher than average outcomes," for hospitals with
risk-adjusted outcomes much higher than the norm.
   (2) "Higher than average outcomes," for hospitals with
risk-adjusted outcomes higher than the norm.
   (3) "Average outcomes," for hospitals with average risk-adjusted
outcomes.
   (4) "Lower than average outcomes," for hospitals with
risk-adjusted outcomes lower than the norm.
   (5) "Much lower than average outcomes," for hospitals with
risk-adjusted outcomes much lower than the norm.
   (e) For coronary artery bypass graft surgery reports and any other
outcome reports for which auditing is appropriate, the office shall
conduct periodic auditing of data at hospitals.
   (f) The office shall publish in the annual reports required under
this section the risk-adjusted mortality rate for each hospital and
for those reports that include physician reporting, for each
physician.
   (g) The office shall either include in the annual reports required
under this section, or make separately available at cost to any
person requesting it, risk-adjusted outcomes data assessing the
statistical significance of hospital or physician data at each of the
following three levels: 99-percent confidence level (0.01 p-value),
95-percent confidence level (0.05 p-value), and 90-percent confidence
level (0.10 p-value). The office shall include any other analysis or
comparisons of the data in the annual reports required under this
section that the office deems appropriate to further the purposes of
this chapter.
  SEC. 31.  Section 128750 of the Health and Safety Code is amended
to read:
   128750.  (a) Prior to the public release of the annual outcome
reports, the office shall furnish a preliminary report to each
hospital that is included in the report. The office shall allow the
hospital and chief of staff 60 days to review the outcome scores and
compare the scores to other California hospitals. A hospital or its
chief of staff that believes that the risk-adjusted outcomes do not
accurately reflect the quality of care provided by the hospital may
submit a statement to the office, within the 60 days, explaining why
the outcomes do not accurately reflect the quality of care provided
by the hospital. The statement shall be included in an appendix to
the public report, and a notation that the hospital or its chief of
staff has submitted a statement shall be displayed wherever the
report presents outcome scores for the hospital.
   (b) (1) Prior to the public release of any outcome report that
includes data by a physician, the office shall furnish a preliminary
report to each physician that is included in the report. The office
shall allow the physician 30 days from the date the office sends the
report to the physician to review the outcome scores and compare the
scores to other California physicians. A physician who believes that
the risk-adjusted outcome does not accurately reflect the quality of
care provided by the physician may submit a statement to the office
within the 30 days, explaining why the outcomes do not accurately
reflect the quality of care provided by the physician.
   (2) The office shall promptly review the physician's statement and
shall respond to the physician with one of the following
conclusions:
   (A) The physician's statement reveals a flaw in the accuracy of
the reported data relating to the physician that materially
diminishes the validity of the report. If this finding is made, the
data for that physician shall not be included in the report until the
flaw in the physician's data is corrected.
   (B) The physician's statement reveals a flaw in the
risk-adjustment model that materially diminishes the value of the
report for all physicians. If this finding is made, the report using
that risk-adjustment model shall not be issued until the flaw is
corrected.
   (C) The physician's statement does not reveal a flaw in either the
accuracy of the reported data relating to the physician or the
risk-adjustment model in which case the report shall be used, unless
the physician chooses to use the procedure set forth in paragraph
(3).
   (3) If a physician is not satisfied with the conclusion reached by
the office, the physician shall notify the office of that fact. Upon
receipt of the notice, the office shall forward the physician's
statement to the appropriate clinical panel appointed pursuant to
Section 128748. The office shall forward the physician's statement
with any information identifying the physician or the physician's
hospital redacted, or shall adopt other means to ensure the physician'
s identity is not revealed to the panel. The clinical panel shall
promptly review the physician statement and the conclusion of the
office and shall respond by either upholding the conclusion or
reaching                                             one of the other
conclusions set forth in this subdivision. The panel decision shall
be the final determination regarding the physician's statement. The
process set forth in this subdivision shall be completed within 60
days from the date the office sends the report to each physician
included in the report. If a decision by either the office or the
clinical panel cannot be reached within the 60-day period, then the
outcome report may be issued but shall not include data for the
physician submitting the statement.
   (c) The office shall, in addition to public reports, provide
hospitals and the chiefs of staff of the medical staffs with a report
containing additional detailed information derived from data
summarized in the public outcome reports as an aid to internal
quality assurance.
   (d) If, pursuant to the recommendations of the office, the
Legislature subsequently amends Section 128735 to authorize the
collection of additional discharge data elements, then the outcome
reports for conditions and procedures for which sufficient data is
not available from the current abstract record will be produced
following the collection and analysis of the additional data
elements.
   (e) The recommendations of the office for the addition of data
elements to the discharge abstract should take into consideration the
technical feasibility of developing reliable risk-adjustment factors
for additional procedures and conditions as determined by the office
with the advice of the research community, physicians and surgeons,
hospitals, consumer or patient advocacy groups, and medical records
personnel.
   (f) The office at a minimum shall identify a limited set of core
clinical data elements to be collected for all of the added
procedures and conditions and unique clinical variables necessary for
risk adjustment of specific conditions and procedures selected for
the outcomes report program. In addition, the committee should give
careful consideration to the costs associated with the additional
data collection and the value of the specific information to be
collected.
   (g) The office shall also engage in a continuing process of data
development and refinement applicable to both current and prospective
outcome studies.
  SEC. 32.  Section 128760 of the Health and Safety Code is amended
to read:
   128760.  (a) On and after January 1, 1986, those systems of health
facility accounting and auditing formerly approved by the California
Health Facilities Commission shall remain in full force and effect
for use by health facilities but shall be maintained by the office.
   (b) The office shall allow and provide, in accordance with
appropriate regulations, for modifications in the accounting and
reporting systems for use by health facilities in meeting the
requirements of this chapter if the modifications are necessary to do
any of the following:
   (1) To correctly reflect differences in size of, provision of, or
payment for, services rendered by health facilities.
   (2) To correctly reflect differences in scope, type, or method of
provision of, or payment for, services rendered by health facilities.

   (3) To avoid unduly burdensome costs for those health facilities
in meeting the requirements of differences pursuant to paragraphs (1)
and (2).
   (c) Modifications to discharge data reporting requirements. The
office shall allow and provide, in accordance with appropriate
regulations, for modifications to discharge data reporting format and
frequency requirements if these modifications will not impair the
office's ability to process the data or interfere with the purposes
of this chapter. This modification authority shall not be construed
to permit the office to administratively require the reporting of
discharge data items not specified pursuant to Section 128735.
   (d) Modifications to emergency care data reporting requirements.
The office shall allow and provide, in accordance with appropriate
regulations, for modifications to emergency care data reporting
format and frequency requirements if these modifications will not
impair the office's ability to process the data or interfere with the
purposes of this chapter. This modification authority shall not be
construed to permit the office to require administratively the
reporting of emergency care data items not specified in subdivision
(a) of Section 128736.
   (e) Modifications to ambulatory surgery data reporting
requirements. The office shall allow and provide, in accordance with
appropriate regulations, for modifications to ambulatory surgery data
reporting format and frequency requirements if these modifications
will not impair the office's ability to process the data or interfere
with the purposes of this chapter. The modification authority shall
not be construed to permit the office to require administratively the
reporting of ambulatory surgery data items not specified in
subdivision (a) of Section 128737.
   (f) Reporting provisions for health facilities. The office shall
establish specific reporting provisions for health facilities that
receive a preponderance of their revenue from associated
comprehensive group practice prepayment health care service plans.
These health facilities shall be authorized to utilize established
accounting systems, and to report costs and revenues in a manner that
is consistent with the operating principles of these plans and with
generally accepted accounting principles. When these health
facilities are operated as units of a coordinated group of health
facilities under common management, they shall be authorized to
report as a group rather than as individual institutions. As a group,
they shall submit a consolidated income and expense statement.
   (g)  Hospitals authorized to report as a group under this
subdivision may elect to file cost data reports required under the
regulations of the Social Security Administration in its
administration of Title XVIII of the federal Social Security Act in
lieu of any comparable cost reports required under Section 128735.
However, to the extent that cost data is required from other
hospitals, the cost data shall be reported for each individual
institution.
   (h) The office shall adopt comparable modifications to the
financial reporting requirements of this chapter for county hospital
systems consistent with the purposes of this chapter.
  SEC. 33.  Section 128765 of the Health and Safety Code is amended
to read:
   128765.  (a) The office shall maintain a file of all the reports
filed under this chapter at its Sacramento office. Subject to any
rules the office may prescribe, these reports shall be produced and
made available for inspection upon the demand of any person, and
shall also be posted on its Web site, with the exception of discharge
and encounter data that shall be available for public inspection
unless the office determines, pursuant to applicable law, that an
individual patient's rights of confidentiality would be violated.
   (b) The reports published pursuant to Section 128745 shall include
an executive summary, written in plain English to the maximum extent
practicable, that shall include, but not be limited to, a discussion
of findings, conclusions, and trends concerning the overall quality
of medical outcomes, including a comparison to reports from prior
years, for the procedure or condition studied by the report. The
office shall disseminate the reports as widely as practical to
interested parties, including, but not limited to, hospitals,
providers, the media, purchasers of health care, consumer or patient
advocacy groups, and individual consumers. The reports shall be
posted on the office's Internet Web site.
   (c) Copies certified by the office as being true and correct
copies of reports properly filed with the office pursuant to this
chapter, together with summaries, compilations, or supplementary
reports prepared by the office, shall be introduced as evidence,
where relevant, at any hearing, investigation, or other proceeding
held, made, or taken by any state, county, or local governmental
agency, board, or commission that participates as a purchaser of
health facility services pursuant to the provisions of a publicly
financed state or federal health care program. Each of these state,
county, or local governmental agencies, boards, and commissions shall
weigh and consider the reports made available to it pursuant to the
provisions of this subdivision in its formulation and implementation
of policies, regulations, or procedures regarding reimbursement
methods and rates in the administration of these publicly financed
programs.
   (d) The office shall compile and publish summaries of individual
facility and aggregate data that do not contain patient-specific
information for the purpose of public disclosure. The summaries shall
be posted on the office's Internet Web site. The office may initiate
and conduct studies as it determines will advance the purposes of
this chapter.
   (e) In order to assure that accurate and timely data are available
to the public in useful formats, the office shall establish a public
liaison function. The public liaison shall provide technical
assistance to the general public on the uses and applications of
individual and aggregate health facility data and shall provide the
director with an annual report on changes that can be made to improve
the public's access to data.
  SEC. 34.  Section 128770 of the Health and Safety Code is amended
to read:
   128770.  (a) Any health facility or freestanding ambulatory
surgery clinic that does not file any report as required by this
chapter with the office is liable for a civil penalty of one hundred
dollars ($100) a day for each day the filing of any report is
delayed. No penalty shall be imposed if an extension is granted in
accordance with the guidelines and procedures established by the
office.
   (b) Any health facility that does not use an approved system of
accounting pursuant to the provisions of this chapter for purposes of
submitting financial and statistical reports as required by this
chapter shall be liable for a civil penalty of not more than five
thousand dollars ($5,000).
   (c) Civil penalties are to be assessed and recovered in a civil
action brought in the name of the people of the State of California
by the office. Assessment of a civil penalty may, at the request of
any health facility or freestanding ambulatory surgery clinic, be
reviewed on appeal, and the penalty may be reduced or waived for good
cause.
   (d) Any money that is received by the office pursuant to this
section shall be paid into the General Fund.
  SEC. 35.  Section 128775 of the Health and Safety Code is amended
to read:
   128775.  (a) Any health facility or freestanding ambulatory
surgery clinic affected by any determination made under this part by
the office may petition the office for review of the decision. This
petition shall be filed with the office within 15 business days, or
within a greater time as the office may allow, and shall specifically
describe the matters which are disputed by the petitioner.
   (b) A hearing shall be commenced within 60 calendar days of the
date on which the petition was filed. The hearing shall be held
before an employee of the office, or an administrative law judge
employed by the Office of Administrative Hearings. If held before an
employee of the office, the hearing shall be held in accordance with
any procedures as the office shall prescribe. If held before an
administrative law judge employed by the Office of Administrative
Hearings, the hearing shall be held in accordance with Chapter 5
(commencing with Section 11500) of Part 1 of Division 3 of Title 2 of
the Government Code. The employee or administrative law judge shall
prepare a recommended decision including findings of fact and
conclusions of law and present it to the office for its adoption. The
decision of the office shall be in writing and shall be final. The
decision of the office shall be made within 60 calendar days after
the conclusion of the hearing and shall be effective upon filing and
service upon the petitioner.
   (c) Judicial review of any final action, determination, or
decision may be had by any party to the proceedings as provided in
Section 1094.5 of the Code of Civil Procedure. The decision of the
office shall be upheld against a claim that its findings are not
supported by the evidence unless the court determines that the
findings are not supported by substantial evidence.
   (d) The employee of the office, or the administrative law judge
employed by the Office of Administrative Hearings or the Office of
Administrative Hearings, may issue subpoenas and subpoenas duces
tecum in a manner and subject to the conditions established by
Article 11 (commencing with Section 11450.10) of Chapter 4.5 of Part
1 of Division 3 of Title 2 of the Government Code.
   (e) This section shall become operative on July 1, 1997.
  SEC. 36.  Section 128785 of the Health and Safety Code is amended
to read:
   128785.  On January 1, 1986, all regulations previously adopted by
the California Health Facilities Commission that relate to functions
vested in the office and that are in effect on that date, shall
remain in effect and shall be fully enforceable to the extent that
they are consistent with this chapter, as determined by the office,
unless and until readopted, amended, or repealed by the office.
  SEC. 37.  Section 128810 of the Health and Safety Code is amended
to read:
   128810.  The office shall administer this chapter and shall make
all regulations necessary to implement the provisions and achieve the
purposes stated herein.
  SEC. 38.  Section 129010 of the Health and Safety Code is amended
to read:
   129010.  Unless the context otherwise requires, the definitions in
this section govern the construction of this chapter and of Section
32127.2.
   (a) "Bondholder" means the legal owner of a bond or other evidence
of indebtedness issued by a political subdivision or a nonprofit
corporation.
   (b) "Borrower" means a political subdivision or nonprofit
corporation that has secured or intends to secure a loan for the
construction of a health facility.
   (c) "Construction, improvement, or expansion" or "construction,
improvement, and expansion" includes construction of new buildings,
expansion, modernization, renovation, remodeling and alteration of
existing buildings, acquisition of existing buildings or health
facilities, and initial or additional equipping of any of these
buildings.
   In connection therewith, "construction, improvement, or expansion"
or "construction, improvement, and expansion" includes the cost of
construction or acquisition of all structures, including parking
facilities, real or personal property, rights, rights-of-way, the
cost of demolishing or removing any buildings or structures on land
so acquired, including the cost of acquiring any land where the
buildings or structures may be moved, the cost of all machinery and
equipment, financing charges, interest (prior to, during and for a
period after completion of the construction), provisions for working
capital, reserves for principal and interest and for extensions,
enlargements, additions, replacements, renovations and improvements,
cost of engineering, financial and legal services, plans,
specifications, studies, surveys, estimates of cost and of revenues,
administrative expenses, expenses necessary or incident to
determining the feasibility or practicability of constructing or
incident to the construction; or the financing of the construction or
acquisition.
   (d) "Committee" means the Advisory Loan Insurance Committee.
   (e) "Debenture" means any form of written evidence of indebtedness
issued by the State Treasurer pursuant to this chapter, as
authorized by Section 4 of Article XVI of the California
Constitution.
   (f) "Fund" means the Health Facility Construction Loan Insurance
Fund.
   (g) "Health facility" means any facility providing or designed to
provide services for the acute, convalescent, and chronically ill and
impaired, including, but not limited to, public health centers,
community mental health centers, facilities for the developmentally
disabled, nonprofit community care facilities that provide care,
habilitation, rehabilitation or treatment to developmentally disabled
persons, facilities for the treatment of chemical dependency,
including a community care facility, licensed pursuant to Chapter 3
(commencing with Section 1500) of Division 2, a clinic, as defined
pursuant to Chapter 1 (commencing with Section 1200) of Division 2,
an alcoholism recovery facility, defined pursuant to former Section
11834.11, and a structure located adjacent or attached to another
type of health facility and that is used for storage of materials
used in the treatment of chemical dependency, and general
tuberculosis, mental, and other types of hospitals and related
facilities, such as laboratories, outpatient departments, extended
care, nurses' home and training facilities, offices and central
service facilities operated in connection with hospitals, diagnostic
or treatment centers, extended care facilities, nursing homes, and
rehabilitation facilities. "Health facility" also means an adult day
health center and a multilevel facility. Except for facilities for
the developmentally disabled, facilities for the treatment of
chemical dependency, or a multilevel facility, or as otherwise
provided in this subdivision, "health facility" does not include any
institution furnishing primarily domiciliary care.
   "Health facility" also means accredited nonprofit work activity
programs as defined in subdivision (e) of Section 19352 and Section
19355 of the Welfare and Institutions Code, and nonprofit community
care facilities as defined in Section 1502, excluding foster family
homes, foster family agencies, adoption agencies, and residential
care facilities for the elderly.
   Unless the context dictates otherwise, "health facility" includes
a political subdivision of the state or nonprofit corporation that
operates a facility included within the definition set forth in this
subdivision.
   (h) "Office" means the Office of Statewide Health Planning and
Development.
   (i) "Lender" means the provider of a loan and its successors and
assigns.
   (j) "Loan" means money or credit advanced for the costs of
construction or expansion of the health facility, and includes both
initial loans and loans secured upon refinancing and may include both
interim, or short-term loans, and long-term loans. A duly authorized
bond or bond issue, or an installment sale agreement, may constitute
a "loan."
   (k) "Maturity date" means the date that the loan indebtedness
would be extinguished if paid in accordance with periodic payments
provided for by the terms of the loan.
   (l) "Mortgage" means a first mortgage on real estate. "Mortgage"
includes a first deed of trust.
   (m) "Mortgagee" includes a lender whose loan is secured by a
mortgage. "Mortgagee" includes a beneficiary of a deed of trust.
   (n) "Mortgagor" includes a borrower, a loan to whom is secured by
a mortgage, and the trustor of a deed of trust.
   (o) "Nonprofit corporation" means any corporation formed under or
subject to the Nonprofit Public Benefit Corporation Law (Part 2
(commencing with Section 5110) of Division 2 of Title 1 of the
Corporations Code) that is organized for the purpose of owning and
operating a health facility and that also meets the requirements of
Section 501(c)(3) of the Internal Revenue Code.
   (p) "Political subdivision" means any city, county, joint powers
entity, local hospital district, or the California Health Facilities
Authority.
   (q) "Project property" means the real property where the health
facility is, or is to be, constructed, improved, or expanded, and
also means the health facility and the initial equipment in that
health facility.
   (r) "Public health facility" means any health facility that is or
will be constructed for and operated and maintained by any city,
county, or local hospital district.
   (s) "Adult day health center" means a facility defined under
subdivision (b) of Section 1570.7, that provides adult day health
care, as defined under subdivision (a) of Section 1570.7.
   (t) "Multilevel facility" means an institutional arrangement where
a residential facility for the elderly is operated as a part of, or
in conjunction with, an intermediate care facility, a skilled nursing
facility, or a general acute care hospital. "Elderly," for the
purposes of this subdivision, means a person 60 years of age or
older.
   (u) "State plan" means the plan described in Section 129020.
  SEC. 39.  Section 129015 of the Health and Safety Code is amended
to read:
   129015.  The office shall administer this chapter and shall make
all regulations necessary to implement the provisions and achieve the
purposes stated herein.
  SEC. 40.  Section 129100 of the Health and Safety Code is amended
to read:
   129100.  Every applicant for insurance shall be afforded an
opportunity for a fair hearing before the committee upon 10 days'
written notice to the applicant. If the office, after affording
reasonable opportunity for development and presentation of the
application and after receiving the advice of the committee, finds
that an application complies with the requirements of this article
and of Section 129020 and is otherwise in conformity with the state
plan, it may approve the application for insurance. The office shall
consider and approve applications in the order of relative need set
forth in the state plan in accordance with Section 129020. Judicial
review of a final decision made under this section may be had by
filing a petition for writ of mandate. Any petition shall be filed
within 30 days after the date of the final decision of the office.
  SEC. 41.  Section 10618.6 of the Welfare and Institutions Code is
amended to read:
   10618.6.  (a) When a youth in a foster care placement reaches his
or her 16th birthday, the county welfare department shall request a
consumer disclosure, pursuant to the free annual disclosure provision
of the federal Fair Credit Reporting Act, on the youth's behalf,
notwithstanding any other law, to ascertain whether or not identity
theft has occurred. If there is a disclosure for the youth and if the
consumer disclosure reveals any negative items, or any evidence that
some form of identity theft has occurred, the county welfare
department shall refer the youth to an approved counseling
organization that provides services to victims of identity theft. The
State Department of Social Services, in consultation with the County
Welfare Directors Association, consumer credit reporting agencies,
and other relevant stakeholders, shall develop a list of approved
organizations to which youth may be referred for assistance in
responding to an instance of suspected identity theft. This section
shall not be construed to require the county welfare department to
request more than one consumer disclosure on behalf of a youth in
care, or to take steps beyond referring the youth to an approved
organization.
   (b) This section shall not be implemented until July 1, 2013.
  SEC. 42.  Section 11265.2 of the Welfare and Institutions Code, as
amended by Section 5 of Chapter 8 of the Statutes of 2011, is amended
to read:
   11265.2.  (a) The grant amount a recipient shall be entitled to
receive for each month of the quarterly reporting period shall be
prospectively determined as provided by this section. If a recipient
reports that he or she does not anticipate any changes in income
during the upcoming quarter, compared to the income the recipient
reported actually receiving on the quarterly report form, the grant
shall be calculated using the actual income received. If a recipient
reports that he or she anticipates a change in income in one or more
months of the upcoming quarter, the county shall determine whether
the recipient's income is reasonably anticipated. The grant shall be
calculated using the income that the county determines is reasonably
anticipated in each of the three months of the upcoming quarter.
   (b) For the purposes of the quarterly reporting, prospective
budgeting system, income shall be considered to be "reasonably
anticipated" if the county is reasonably certain of the amount of
income and that the income will be received during the quarterly
reporting period. The county shall determine what income is
"reasonably anticipated" based on information provided by the
recipient and any other available information.
   (c) If a recipient reports that their income in the upcoming
quarter will be different each month and the county needs additional
information to determine a recipient's reasonably anticipated income
for the following quarter, the county may require the recipient to
provide information about income for each month of the prior quarter.

   (d) Grant calculations pursuant to subdivision (a) may not be
revised to adjust the grant amount during the quarterly reporting
period, except as provided in Section 11265.3 and subdivisions (e),
(f), (g), and (h), and as otherwise established by the department.
   (e) Notwithstanding subdivision (d), statutes and regulations
relating to (1) the 48-month time limit, (2) age limitations for
children under Section 11253, and (3) sanctions and financial
penalties affecting eligibility or grant amount shall be applicable
as provided in those statutes and regulations. Eligibility and grant
amount shall be adjusted during the quarterly reporting period
pursuant to those statutes and regulations effective with the first
monthly grant after timely and adequate notice is provided.
   (f) Notwithstanding Section 11056, if an applicant applies for
assistance for a child who is currently aided in another assistance
unit, and the county determines that the applicant has care and
control of the child, as specified by the department, and is
otherwise eligible, the county shall discontinue aid to the child in
the existing assistance unit and shall aid the child in the applicant'
s assistance unit effective as of the first of the month following
the discontinuance of the child from the existing assistance unit.
   (g) If the county is notified that a child for whom CalWORKs
assistance is currently being paid has been placed in a foster care
home, the county shall discontinue aid to the child at the end of the
month of placement. The county shall discontinue the case if the
remaining assistance unit members are not otherwise eligible.
   (h) If the county determines that a recipient is no longer a
California resident, pursuant to Section 11100, the recipient shall
be discontinued. The county shall discontinue the case if the
remaining assistance unit members are not otherwise eligible.

           SEC. 43.  Section 11320.15 of the Welfare and Institutions
Code, as amended by Section 7 of Chapter 8 of the Statutes of 2011,
is amended to read:
   11320.15.  After a participant has been removed from the
assistance unit under subdivision (a) of Section 11454, additional
welfare-to-work services may be provided to the recipient, at the
option of the county. If the county provides services to the
recipient after the 48-month limit has been reached, the recipient
shall participate in community service or subsidized employment, as
described in Section 11322.63.
  SEC. 44.  Section 11320.3 of the Welfare and Institutions Code, as
amended by Section 9 of Chapter 8 of the Statutes of 2011, is amended
to read:
   11320.3.  (a) (1) Except as provided in subdivision (b) or if
otherwise exempt, every individual, as a condition of eligibility for
aid under this chapter, shall participate in welfare-to-work
activities under this article.
   (2) Individuals eligible under Section 11331.5 shall be required
to participate in the Cal-Learn Program under Article 3.5 (commencing
with Section 11331) during the time that article is operative, in
lieu of the welfare-to-work requirements, and subdivision (b) shall
not apply to that individual.
   (b) The following individuals shall not be required to participate
for so long as the condition continues to exist:
   (1) An individual under 16 years of age.
   (2) (A) A child attending an elementary, secondary, vocational, or
technical school on a full-time basis.
   (B) A person who is 16 or 17 years of age, or a person described
in subdivision (d) who loses this exemption, shall not requalify for
the exemption by attending school as a required activity under this
article.
   (C) Notwithstanding subparagraph (B), a person who is 16 or 17
years of age who has obtained a high school diploma or its equivalent
and is enrolled or is planning to enroll in a postsecondary
education, vocational, or technical school training program shall
also not be required to participate for so long as the condition
continues to exist.
   (D) For purposes of subparagraph (C), a person shall be deemed to
be planning to enroll in a postsecondary education, vocational, or
technical school training program if he or she, or his or her parent,
acting on his or her behalf, submits a written statement expressing
his or her intent to enroll in such a program for the following term.
The exemption from participation shall not continue beyond the
beginning of the term, unless verification of enrollment is provided
or obtained by the county.
   (3) An individual who meets either of the following conditions:
   (A) The individual is disabled as determined by a doctor's
verification that the disability is expected to last at least 30 days
and that it significantly impairs the recipient's ability to be
regularly employed or participate in welfare-to-work activities,
provided that the individual is actively seeking appropriate medical
treatment.
   (B) The individual is of advanced age.
   (4) A nonparent caretaker relative who has primary responsibility
for providing care for a child and is either caring for a child who
is a dependent or ward of the court or caring for a child in a case
in which a county determines the child is at risk of placement in
foster care, and the county determines that the caretaking
responsibilities are beyond those considered normal day-to-day
parenting responsibilities such that they impair the caretaker
relative's ability to be regularly employed or to participate in
welfare-to-work activities.
   (5) An individual whose presence in the home is required because
of illness or incapacity of another member of the household and whose
caretaking responsibilities impair the recipient's ability to be
regularly employed or to participate in welfare-to-work activities.
   (6) A parent or other relative who meets the criteria in
subparagraph (A) or (B).
   (A) (i) The parent or other relative has primary responsibility
for personally providing care to a child six months of age or under,
except that, on a case-by-case basis, and based on criteria developed
by the county, this period may be reduced to the first 12 weeks
after the birth or adoption of the child, or increased to the first
12 months after the birth or adoption of the child. An individual may
be exempt only once under this clause.
   (ii) An individual who received an exemption pursuant to clause
(i) shall be exempt for a period of 12 weeks, upon the birth or
adoption of any subsequent children, except that this period may be
extended on a case-by-case basis to six months, based on criteria
developed by the county.
   (iii) In making the determination to extend the period of
exception under clause (i) or (ii), the following may be considered:
   (I) The availability of child care.
   (II) Local labor market conditions.
   (III) Other factors determined by the county.
   (B) In a family eligible for aid under this chapter due to the
unemployment of the principal wage earner, the exemption criteria
contained in subparagraph (A) shall be applied to only one parent.
   (7) A parent or other relative who has primary responsibility for
personally providing care to one child who is from 12 to 23 months of
age, inclusive, or two or more children who are under six years of
age.
   (8) A woman who is pregnant and for whom it has been medically
verified that the pregnancy impairs her ability to be regularly
employed or participate in welfare-to-work activities or the county
has determined that, at that time, participation will not readily
lead to employment or that a training activity is not appropriate.
   (c) Any individual not required to participate may choose to
participate voluntarily under this article, and end that
participation at any time without loss of eligibility for aid under
this chapter, if his or her status has not changed in a way that
would require participation.
   (d) (1) Notwithstanding subdivision (a), a custodial parent who is
under 20 years of age and who has not earned a high school diploma
or its equivalent, and who is not exempt or whose only basis for
exemption is paragraph (1), (2), (5), (6), (7), or (8) of subdivision
(b), shall be required to participate solely for the purpose of
earning a high school diploma or its equivalent. During the time that
Article 3.5 (commencing with Section 11331) is operative, this
subdivision shall only apply to a custodial parent who is 19 years of
age.
   (2) Section 11325.25 shall apply to a custodial parent who is 18
or 19 years of age and who is required to participate under this
article.
   (e) Notwithstanding paragraph (1) of subdivision (d), the county
may determine that participation in education activities for the
purpose of earning a high school diploma or equivalent is
inappropriate for an 18 or 19 year old custodial parent only if that
parent is reassigned pursuant to an evaluation under Section
11325.25, or, at appraisal is already in an educational or vocational
training program that is approvable as a self-initiated program as
specified in Section 11325.23. If that determination is made, the
parent shall be allowed to continue participation in the
self-initiated program subject to Section 11325.23. During the time
that Article 3.5 (commencing with Section 11331) is operative, this
subdivision shall only apply to a custodial parent who is 19 years of
age.
   (f) A recipient shall be excused from participation for good cause
when the county has determined there is a condition or other
circumstance that temporarily prevents or significantly impairs the
recipient's ability to be regularly employed or to participate in
welfare-to-work activities. The county welfare department shall
review the good cause determination for its continuing
appropriateness in accordance with the projected length of the
condition, or circumstance, but not less than every three months. The
recipient shall cooperate with the county welfare department and
provide information, including written documentation, as required to
complete the review. Conditions that may be considered good cause
include, but are not limited to, the following:
   (1) Lack of necessary supportive services.
   (2) In accordance with Article 7.5 (commencing with Section
11495), the applicant or recipient is a victim of domestic violence,
but only if participation under this article is detrimental to or
unfairly penalizes that individual or his or her family.
   (3) Licensed or license-exempt child care for a child 10 years of
age or younger is not reasonably available during the individual's
hours of training or employment including commuting time, or
arrangements for child care have broken down or have been
interrupted, or child care is needed for a child who meets the
criteria of subparagraph (C) of paragraph (1) of subdivision (a) of
Section 11323.2, but who is not included in the assistance unit. For
purposes of this paragraph, "reasonable availability" means child
care that is commonly available in the recipient's community to a
person who is not receiving aid and that is in conformity with the
requirements of Public Law 104-193. The choices of child care shall
meet either licensing requirements or the requirements of Section
11324. This good cause criterion shall include the unavailability of
suitable special needs child care for children with identified
special needs, including, but not limited to, disabilities or chronic
illnesses.
   (g) (1) Paragraph (7) of subdivision (b) shall be implemented
notwithstanding Sections 11322.4, 11322.7, 11325.6, and 11327, and
shall become inoperative on July 1, 2012.
   (2) The State Department of Social Services, in consultation with
the County Welfare Directors Association of California, shall develop
a process prior to January 1, 2012, to assist clients with
reengagement in welfare-to-work activities by July 1, 2012.
Reengagement activities may include notifying clients of the
expiration of exemptions, potential reassessments, and identifying
necessary supportive services.
  SEC. 45.  Section 11322.63 of the Welfare and Institutions Code is
amended to read:
   11322.63.  (a) For counties that implement a welfare-to-work plan
that includes activities pursuant to subdivisions (b) and (c) of
Section 11322.6, the State Department of Social Services shall pay
the county 50 percent, less fifty-six dollars ($56), of the total
wage costs of an employee for whom a wage subsidy is paid, subject to
all of the following conditions:
   (1) (A) For participants receiving CalWORKs aid, the maximum state
contribution of the total wage cost shall not exceed 100 percent of
the computed grant for the assistance unit in the month prior to
participation in subsidized employment.
   (B) For participants who have received aid in excess of the time
limits provided in subdivision (a) of Section 11454, the maximum
state contribution of the total wage cost, shall not exceed 100
percent of the computed grant for the assistance unit in the month
prior to participation in subsidized employment.
   (C) In the case of an individual who participates in subsidized
employment as a service provided by a county pursuant to Section
11323.25, the maximum state contribution of the total wage cost shall
not exceed 100 percent of the computed grant that the assistance
unit received in the month prior to participation in the subsidized
employment.
   (D) The maximum state contribution, as defined in this paragraph,
shall remain in effect until the end of the subsidy period as
specified in paragraph (2), including with respect to subsidized
employment participants whose wage results in the assistance unit no
longer receiving a CalWORKs grant.
   (E) State funding provided for total wage costs shall only be used
to fund wage and nonwage costs of the county's subsidized employment
program.
   (2) State participation in the total wage costs pursuant to this
section shall be limited to a maximum of six months of wage subsidies
for each participant. If the county finds that a longer subsidy
period is necessary in order to mutually benefit the employer and the
participant, state participation in a subsidized wage may be offered
for up to 12 months.
   (3) Eligibility for entry into subsidized employment funded under
this section shall be limited to individuals who are not otherwise
employed at the time of entry into the subsidized job, and who are
current CalWORKs recipients, sanctioned individuals, or individuals
described in Section 11320.15 who have exceeded the time limits
specified in subdivision (a) of Section 11454. A county may continue
to provide subsidized employment funded under this section to
individuals who become ineligible for CalWORKs benefits in accordance
with Section 11323.25.
   (b) Upon application for CalWORKs after a participant's subsidized
employment ends, if an assistance unit is otherwise eligible within
three calendar months of the date that subsidized employment ended,
the income exemption requirements contained in Section 11451.5 and
the work requirements contained in subdivision (c) of Section 11201
shall apply. If aid is restored after the expiration of that
three-month period, the income exemption requirements contained in
Section 11450.12 and the work requirements contained in subdivision
(b) of Section 11201 shall apply.
   (c) The department, in conjunction with representatives of county
welfare offices and their directors and the Legislative Analyst's
Office, shall assess the cost neutrality of the subsidized employment
program pursuant to this section and make recommendations to the
Legislature, if necessary, to ensure cost neutrality. The department
shall testify regarding the cost neutrality of the subsidized
employment program during the 2012-13 fiscal year legislative budget
hearings.
   (d) No later than January 10, 2013, the State Department of Social
Services shall submit a report to the Legislature on the outcomes of
implementing this section that shall include, but need not be
limited to, all of the following:
   (1) The number of CalWORKs recipients that entered subsidized
employment.
   (2) The number of CalWORKs recipients who found nonsubsidized
employment after the subsidy ends.
   (3) The earnings of the program participants before and after the
subsidy.
   (4) The impact of this program on the state's work participation
rate.
   (e) Payment of the state's share in total wage costs required by
this section shall be made in addition to, and independent of, the
county allocations made pursuant to Section 15204.2.
   (f) For purposes of this section, "total wage costs" include the
actual wage paid directly to the participant that is allowable under
the Temporary Assistance for Needy Families program.
  SEC. 45.5.  Section 11329.5 of the Welfare and Institutions Code is
amended to read:
   11329.5.  With respect to paragraph (7) of subdivision (b) of
Section 11320.3 and Section 11325.71, the Legislature finds and
declares all of the following, but only for the operative period of
these added provisions:
   (a) Due to the significant General Fund revenue decline for the
2009-10 fiscal year, funding has been reduced for the CalWORKs
program.
   (b) Due to the federal funding available under the American
Recovery and Reinvestment Act of 2009 (Public Law 111-5) (ARRA) for
CalWORKs grants, reductions in 2009-10 are being achieved in the
county single allocation.
   (c) Reduced funding, including a
three-hundred-seventy-five-million-dollar ($375,000,000) reduction to
the county single allocation in the 2009-10 and 2010-11 Budget Acts,
and increased caseload for CalWORKs will result in insufficient
resources to provide the full range of welfare-to-work services in
the 2009-10 and 2010-11 fiscal years.
   (d) Reduced funding, including a three hundred seventy-six million
eight hundred fifty thousand dollar ($376,850,000) reduction to the
county single allocation in the 2011-12 Budget Act, will result in
insufficient resources to provide the full range of welfare-to-work
services in the 2011-12 fiscal year.
   (e) It is the intent of the Legislature that the limited resources
for CalWORKs services be effectively utilized, as established in
paragraph (7) of subdivision (b) of Section 11320.3.
   (f) It is the further intent of the Legislature to provide
additional flexibility to address funding constraints, as established
in Section 11325.71, in addition to the existing flexibility
provided under subdivision (f) of Section 11320.3.
   (g) It is the further intent of the Legislature to minimize
disruption of welfare-to-work services for individuals already
participating, and prioritize exemptions and good cause for
applicants.
   (h) Funding and caseload factors will result in circumstances
beyond the control of the counties in the 2009-10, 2010-11, and
2011-12 fiscal years, and relief should be provided for federal
penalties that may result.
  SEC. 46.  Section 11334.8 of the Welfare and Institutions Code is
amended to read:
   11334.8.  (a) Except as provided in subdivision (b), this article
shall be inoperative from July 1, 2011, to June 30, 2012, inclusive.
   (b) Notwithstanding subdivision (a), bonuses and supplements shall
continue to be paid to eligible participants pursuant to
subdivisions (a), (c), and (e) of Section 11333.7, and related
requirements pursuant to Sections 11334.2 and 11334.5 shall also be
operative, during the period that the remainder of this article is
inoperative pursuant to subdivision (a).
   (c) Notwithstanding subdivision (b) of Section 11450, a pregnant
woman with no other children who was determined to be eligible for
aid in the first or second trimester of her pregnancy for purposes of
participating in the Cal-Learn Program prior to July 1, 2011, shall
continue to receive aid during the suspension of the Cal-Learn
Program described in this section, as long as she remains otherwise
eligible for aid under this chapter.
   (d) This section shall remain in effect only until July 1, 2012,
and as of that date is repealed, unless a later enacted statute, that
is enacted before July 1, 2012, deletes or extends that date.
  SEC. 47.  Section 11364 of the Welfare and Institutions Code, as
added by Section 34 of Chapter 559 of the Statutes of 2010, is
amended to read:
   11364.  (a) In order to receive payments under this article, the
county child welfare agency, probation department, or Indian tribe
that has entered into an agreement pursuant to Section 10553.1, shall
negotiate and enter into a written, binding, kinship guardianship
assistance agreement with the relative guardian of an eligible child,
and provide the relative guardian with a copy of the agreement.
   (b) The agreement shall specify, at a minimum, all of the
following:
   (1) The amount of and manner in which the kinship guardianship
assistance payment will be provided under the agreement, and that the
amount is subject to any applicable increases pursuant to
cost-of-living adjustments established by statute, and the manner in
which the agreement may be adjusted periodically, but no less
frequently than every two years, in consultation with the relative
guardian, based on the circumstances of the relative guardian and the
needs of the child.
   (2) Additional services and assistance for which the child and
relative guardian will be eligible under the agreement.
   (3) A procedure by which the relative guardian may apply for
additional services, as needed, including the filing of a petition
under Section 388 to have dependency jurisdiction resumed pursuant to
subdivision (b) of Section 366.3.
   (4) That the agreement shall remain in effect regardless of the
state of residency of the relative guardian.
   (5) The responsibility of the relative guardian for reporting
changes in the needs of the child or the circumstances of the
relative guardian that affect payment.
   (c) In accordance with the Kin-GAP agreement, the relative
guardian shall be paid an amount of aid based on the child's needs
otherwise covered in AFDC-FC payments and the circumstances of the
relative guardian, but that shall not exceed the foster care
maintenance payment that would have been paid based on the
age-related state-approved foster family home care rate and any
applicable specialized care increment for a child placed in a
licensed or approved family home pursuant to subdivisions (a) to (d),
inclusive, of Section 11461. In addition, the rate paid for a child
eligible for a Kin-GAP payment shall include an amount equal to the
clothing allowance, as set forth in subdivision (f) of Section 11461,
including any applicable rate adjustments. For a child eligible for
a Kin-GAP payment who is a teen parent, the rate shall include the
two hundred dollar ($200) monthly payment made to the relative
caregiver in a whole family foster home pursuant to paragraph (3) of
subdivision (d) of Section 11465.
   (d) Commencing on the effective date of the act that added this
subdivision, and notwithstanding subdivision (c), in accordance with
the Kin-GAP agreement, the relative guardian shall be paid an amount
of aid based on the child's needs otherwise covered in AFDC-FC
payments and the circumstances of the relative guardian, as follows:
   (1) For cases in which the dependency has been dismissed pursuant
to Section 366.3 or wardship has been terminated pursuant to
subdivision (e) of Section 728, concurrently or subsequently to
establishment of the guardianship, on or before June 30, 2011, or the
date specified in a final order, for which the time to appeal has
passed, issued by a court of competent jurisdiction in California
State Foster Parent Association, et al. v. William Lightbourne, et
al. (U.S. Dist. Ct. No. C 07-05086 WHA), whichever is earlier, the
rate paid shall not exceed the basic foster care maintenance payment
rate structure in effect prior to the effective date specified in the
order described in this paragraph.
   (2) For cases in which dependency has been dismissed pursuant to
Section 366.3 or wardship has been terminated pursuant to subdivision
(e) of Section 728, concurrently or subsequently to establishment of
the guardianship, on or after July 1, 2011, or the date specified in
the order described in paragraph (1) whichever is earlier, the rate
paid shall not exceed the basic foster care maintenance payment rate
as set forth in paragraph (1) of subdivision (g) of Section 11461.
   (3) Beginning with the 2011-12 fiscal year, the Kin-GAP benefit
payments rate structure shall be adjusted annually by the percentage
change in the California Necessities Index, as set forth in paragraph
(2) of subdivision (g) of Section 11461, without requiring a new
agreement.
   (4) In addition to the rate paid for a child eligible for a
Kin-GAP payment, a specialized care increment, if applicable, as set
forth in subdivision (e) of Section 11461, also shall be paid.
   (5) In addition to the rate paid for a child eligible for a
Kin-GAP payment, a clothing allowance, as set forth in subdivision
(f) of Section 11461, also shall be paid.
   (6) For a child eligible for a Kin-GAP payment who is a teen
parent, the rate shall include the two hundred dollar ($200) monthly
payment made to the relative caregiver in a whole family foster home
pursuant to paragraph (3) of subdivision (d) of Section 11465.
   (e) The county child welfare agency, probation department, or
Indian tribe that entered into an agreement pursuant to Section
10553.1 shall provide the relative guardian with information, in
writing, on the availability of the Kin-GAP program with an
explanation of the difference between these benefits and Adoption
Assistance Program benefits and AFDC-FC benefits. The agency shall
also provide the relative guardian with information on the
availability of mental health services through the Medi-Cal program
or other programs.
   (f) The county child welfare agency, probation department, or
Indian tribe, as appropriate, shall assess the needs of the child and
the circumstances of the related guardian and is responsible for
determining that the child meets the eligibility criteria for
payment.
   (g) Payments on behalf of a child who is a recipient of Kin-GAP
benefits and who is also a consumer of regional center services shall
be based on the rates established by the State Department of Social
Services pursuant to Section 11464.
  SEC. 48.  Section 11387 of the Welfare and Institutions Code is
amended to read:
   11387.  (a) In order to receive federal financial participation
for payments under this article, the county child welfare agency or
probation department or Indian tribe that entered into an agreement
pursuant to Section 10553.1 shall negotiate and enter into a written,
binding, kinship guardianship assistance agreement with the relative
guardian of an eligible child, and provide the relative guardian
with a copy of the agreement.
   (b) The agreement shall specify, at a minimum, all of the
following:
   (1) The amount of and manner in which the kinship guardianship
assistance payment will be provided under the agreement, that the
amount is subject to any applicable increases pursuant to
cost-of-living adjustments established by statute and the manner in
which the agreement may be adjusted periodically, but no less
frequently than every two years, in consultation with the relative
guardian, based on the circumstances of the relative guardian and the
needs of the child.
   (2) Additional services and assistance for which the child and
relative guardian will be eligible under the agreement.
   (3) A procedure by which the relative guardian may apply for
additional services, as needed, including, but not limited to, the
filing of a petition under Section 388 to have dependency
jurisdiction resumed pursuant to subdivision (b) of Section 366.3.
   (4) The agreement shall provide that it shall remain in effect
regardless of the state of residency of the relative guardian.
   (5) The responsibility of the relative guardian for reporting
changes in the needs of the child or the circumstances of the
relative guardian that affect payment.
   (c) In accordance with the Kin-GAP agreement, the relative
guardian shall be paid an amount of aid based on the child's needs
otherwise covered in AFDC-FC payments and the circumstances of the
relative guardian but that shall not exceed the foster care
maintenance payment that would have been paid based on the
age-related state-approved foster family home care rate and any
applicable specialized care increment for a child placed in a
licensed or approved family home pursuant to subdivisions (a) to (d),
inclusive, of Section 11461. In addition, the rate paid for a child
eligible for a Kin-GAP payment shall include an amount equal to the
clothing allowance, as set forth in subdivision (f) of
                                Section 11461, including any
applicable rate adjustments. For a child eligible for a Kin-GAP
payment who is a teen parent, the rate shall include the two hundred
dollar ($200) monthly payment made to the relative caregiver in a
whole family foster home pursuant to paragraph (3) of subdivision (d)
of Section 11465.
   (d) Commencing on the effective date of the act that added this
subdivision, and notwithstanding subdivision (c), in accordance with
the Kin-GAP agreement the relative guardian shall be paid an amount
of aid based on the child's needs otherwise covered in AFDC-FC
payments and the circumstances of the relative guardian, as follows:
   (1) For cases in which the dependency has been dismissed pursuant
to Section 366.3 or wardship has been terminated pursuant to
subdivision (e) of Section 728, concurrently or subsequently to
establishment of the guardianship, on or before June 30, 2011, or the
date specified in a final order, for which the time to appeal has
passed, issued by a court of competent jurisdiction in California
State Foster Parent Association et al. v. William Lightbourne, et al.
(U.S. Dist. Ct. No. C 07-05086 WHA), whichever is earlier, the rate
paid shall not exceed the basic foster care maintenance payment rate
structure in effect prior to the effective date specified in the
order described in this paragraph.
   (2) For cases in which dependency has been dismissed pursuant to
Section 366.3 or wardship has been terminated pursuant to subdivision
(e) of Section 728, concurrently or subsequently to establishment of
the guardianship, on or after July 1, 2011, or the date specified in
the order described in paragraph (1), whichever is earlier, the rate
paid shall not exceed the basic foster care maintenance payment rate
as set forth in paragraph (1) of subdivision (g) of Section 11461.
   (3) Beginning with the 2011-12 fiscal year, the Kin-GAP benefit
payments rate structure shall be adjusted annually by the percentage
change in the California Necessities Index, as set forth in paragraph
(2) of subdivision (g) of Section 11461, without requiring a new
agreement.
   (4) In addition to the rate paid for a child eligible for a
Kin-GAP payment, a specialized care increment, if applicable, as set
forth in subdivision (e) of Section 11461, shall be paid.
   (5) In addition to the rate paid for a child eligible for a
Kin-GAP payment, a clothing allowance, as set forth in subdivision
(f) of Section 11461, shall be paid.
   (6) For a child eligible for a Kin-GAP payment who is a teen
parent, the rate shall include the two hundred dollar ($200) monthly
payment made to the relative caregiver in a whole family foster home
pursuant to paragraph (3) of subdivision (d) of Section 11465.
   (e) The county child welfare agency or probation department or
Indian tribe that entered into an agreement pursuant to Section
10553.1 shall provide the relative guardian with information, in
writing, on the availability of the federal Kin-GAP program with an
explanation of the difference between these benefits and Adoption
Assistance Program benefits and AFDC-FC benefits. The agency shall
also provide the relative guardian with information on the
availability of mental health services through the Medi-Cal program
or other programs.
   (f) The county child welfare agency, probation department, or
Indian tribe, as appropriate, shall assess the needs of the child and
the circumstances of the related guardian and is responsible for
determining that the child meets the eligibility criteria for
payment.
   (g) Payments on behalf of a child who is a recipient of Kin-GAP
benefits and who is also a consumer of regional center services shall
be based on the rates established by the State Department of Social
Services pursuant to Section 11464.
  SEC. 49.  Section 11405 of the Welfare and Institutions Code is
amended to read:
   11405.  (a) AFDC-FC benefits shall be paid to an otherwise
eligible child living with a nonrelated legal guardian, provided that
the legal guardian cooperates with the county welfare department in
all of the following:
   (1) Developing a written assessment of the child's needs.
   (2) Updating the assessment no less frequently than once every six
months.
   (3) Carrying out the case plan developed by the county.
   (b) When AFDC-FC is applied for on behalf of a child living with a
nonrelated legal guardian the county welfare department shall do all
of the following:
   (1) Develop a written assessment of the child's needs.
   (2) Update those assessments no less frequently than once every
six months.
   (3) Develop a case plan that specifies how the problems identified
in the assessment are to be addressed.
   (4) Make visits to the child as often as appropriate, but in no
event less often than once every six months.
   (c) Where the child is a parent and has a child living with him or
her in the same eligible facility, the assessment required by
paragraph (1) of subdivision (a) shall include the needs of his or
her child.
   (d) Nonrelated legal guardians of eligible children who are in
receipt of AFDC-FC payments described in this section shall be exempt
from the requirement to register with the Statewide Registry of
Private Professional Guardians pursuant to Sections 2850 and 2851 of
the Probate Code.
   (e) On and after January 1, 2012, a nonminor youth whose
nonrelated guardianship was ordered in juvenile court pursuant to
Section 360 or 366.26, and whose dependency was dismissed, shall
remain eligible for AFDC-FC benefits until the youth attains 19 years
of age, effective January 1, 2013, until the youth attains 20 years
of age, and effective January 1, 2014, until the youth attains 21
years of age, provided that the youth enters into a mutual agreement
with the agency responsible for his or her guardianship, and the
youth is meeting the conditions of eligibility, as described in
Section 11403.
   (f) (1) For cases in which a guardianship was established on or
before June 30, 2011, or the date specified in a final order, for
which the time for appeal has passed, issued by a court of competent
jurisdiction in California State Foster Parent Association, et al. v.
William Lightbourne, et al. (U.S. Dist. Ct. No C 07-05086 WHA),
whichever is earlier, the AFDC-FC payment described in this section
shall be the foster family home rate structure in effect prior to the
effective date specified in the order described in this paragraph.
   (2) For cases in which guardianship has been established on or
after July 1, 2011, or the date specified in the order described in
paragraph (1), whichever is earlier, the AFDC-FC payments described
in this section shall be the basic foster family home rate set forth
in paragraph (1) of subdivision (g) of Section 11461.
   (3) Beginning with the 2011-12 fiscal year, the AFDC-FC payments
identified in this subdivision shall be adjusted annually by the
percentage change in the California Necessities Index rate as set
forth in paragraph (2) of subdivision (g) of Section 11461.
   (g) In addition to the AFDC-FC rate paid, all of the following
also shall be paid:
   (1) A specialized care increment, if applicable, as set forth in
subdivision (e) of Section 11461.
   (2) A clothing allowance, as set forth in subdivision (f) of
Section 11461.
   (3) For a child eligible for an AFDC-FC payment who is a teen
parent, the rate shall include the two hundred dollar ($200) monthly
payment made to the relative caregiver in a whole family foster home
pursuant to paragraph (3) of subdivision (d) of Section 11465.
  SEC. 50.  Section 11450.025 of the Welfare and Institutions Code is
repealed.
  SEC. 51.  Section 11454 of the Welfare and Institutions Code, as
amended by Section 26 of Chapter 8 of the Statutes of 2011, is
amended to read:
   11454.  (a) A parent or caretaker relative shall not be eligible
for aid under this chapter when he or she has received aid under this
chapter or from any state under the Temporary Assistance for Needy
Families program (Part A (commencing with Section 401) of Title IV of
the federal Social Security Act (42 U.S.C. Sec. 601 et seq.)) for a
cumulative total of 48 months.
   (b) (1) Except as otherwise specified in subdivision (c), Section
11454.5, or other provisions of law, all months of aid received under
this chapter from January 1, 1998, to the operative date of this
section, inclusive, shall be applied to the 48-month time limit
described in subdivision (a).
   (2) All months of aid received from January 1, 1998, to the
operative date of this section, inclusive, in any state pursuant to
the Temporary Assistance for Needy Families program (Part A
(commencing with Section 401) of Title IV of the federal Social
Security Act (42 U.S.C. Sec. 601 et seq.)), shall be applied to the
48-month time limit described in subdivision (a).
   (c) Subdivision (a) and paragraph (1) of subdivision (b) shall not
be applicable when all parents or caretaker relatives of the aided
child who are living in the home of the child meet any of the
following requirements:
   (1) They are 60 years of age or older.
   (2) They meet one of the conditions specified in paragraph (4) or
(5) of subdivision (b) of Section 11320.3.
   (3) They are not included in the assistance unit.
   (4) They are receiving benefits under Section 12200 or Section
12300, State Disability Insurance benefits or Workers' Compensation
Temporary Disability Insurance, if the disability significantly
impairs the recipient's ability to be regularly employed or
participate in welfare-to-work activities.
   (5) They are incapable of maintaining employment or participating
in welfare-to-work activities, as determined by the county, based on
the assessment of the individual and the individual has a history of
participation and full cooperation in welfare-to-work activities.
  SEC. 52.  Section 11454.2 of the Welfare and Institutions Code is
amended to read:
   11454.2.  For purposes of making the transition to the
requirements of the act that added this section, county welfare
departments shall provide any assistance unit that includes a member
who will reach the 48-month time limit described in subdivision (a)
of Section 11454 before January 1, 2012, a notice of action 30 days
prior to the date upon which the grant of the assistance unit will be
reduced. This notice shall include a statement of the rights granted
pursuant to Chapter 7 (commencing with Section 10950) of Part 2.
  SEC. 53.  Section 11461 of the Welfare and Institutions Code is
amended to read:
   11461.  (a) For children or, on and after January 1, 2012,
nonminor dependents placed in a licensed or approved family home with
a capacity of six or less, or in an approved home of a relative or
nonrelated legal guardian, or the approved home of a nonrelative
extended family member as described in Section 362.7, or, on and
after January 1, 2012, a supervised independent living setting, as
defined in subdivision (w) of Section 11400, the per child per month
basic rates in the following schedule shall be in effect for the
period July 1, 1989, through December 31, 1989:
  Age                                   Basic rate
  0-4................................      $294
  5-8................................       319
  9-11...............................       340
12-14...............................       378
15-20...............................       412


   (b) (1) Any county that, as of October 1, 1989, has in effect a
basic rate that is at the levels set forth in the schedule in
subdivision (a), shall continue to receive state participation, as
specified in subdivision (c) of Section 15200, at these levels.
   (2) Any county that, as of October 1, 1989, has in effect a basic
rate that exceeds a level set forth in the schedule in subdivision
(a), shall continue to receive the same level of state participation
as it received on October 1, 1989.
   (c) The amounts in the schedule of basic rates in subdivision (a)
shall be adjusted as follows:
   (1) Effective January 1, 1990, the amounts in the schedule of
basic rates in subdivision (a) shall be increased by 12 percent.
   (2) Effective May 1, 1990, any county that did not increase the
basic rate by 12 percent on January 1, 1990, shall do both of the
following:
   (A) Increase the basic rate in effect December 31, 1989, for which
state participation is received by 12 percent.
   (B) Increase the basic rate, as adjusted pursuant to subparagraph
(A), by an additional 5 percent.
   (3) (A) Except as provided in subparagraph (B), effective July 1,
1990, for the 1990-91 fiscal year, the amounts in the schedule of
basic rates in subdivision (a) shall be increased by an additional 5
percent.
   (B) The rate increase required by subparagraph (A) shall not be
applied to rates increased May 1, 1990, pursuant to paragraph (2).
   (4) Effective July 1, 1998, the amounts in the schedule of basic
rates in subdivision (a) shall be increased by 6 percent.
Notwithstanding any other provision of law, the 6-percent increase
provided for in this paragraph shall, retroactive to July 1, 1998,
apply to every county, including any county to which paragraph (2) of
subdivision (b) applies, and shall apply to foster care for every
age group.
   (5) Notwithstanding any other provision of law, any increase that
takes effect after July 1, 1998, shall apply to every county,
including any county to which paragraph (2) of subdivision (b)
applies, and shall apply to foster care for every age group.
   (6) The increase in the basic foster family home rate shall apply
only to children placed in a licensed foster family home receiving
the basic rate or in an approved home of a relative or nonrelative
extended family member, as described in Section 362.7, a supervised
independent living setting, as defined in subdivision (w) of Section
11400, or a nonrelated legal guardian receiving the basic rate. The
increased rate shall not be used to compute the monthly amount that
may be paid to licensed foster family agencies for the placement of
children in certified foster homes.
   (d) (1) (A) Beginning with the 1991-92 fiscal year, the schedule
of basic rates in subdivision (a) shall be adjusted by the percentage
changes in the California Necessities Index, computed pursuant to
the methodology described in Section 11453, subject to the
availability of funds.
   (B) In addition to the adjustment in subparagraph (A) effective
January 1, 2000, the schedule of basic rates in subdivision (a) shall
be increased by 2.36 percent rounded to the nearest dollar.
   (C) Effective January 1, 2008, the schedule of basic rates in
subdivision (a), as adjusted pursuant to subparagraph (B), shall be
increased by 5 percent, rounded to the nearest dollar. The increased
rate shall not be used to compute the monthly amount that may be paid
to licensed foster family agencies for the placement of children in
certified foster family homes, and shall not be used to recompute the
foster care maintenance payment that would have been paid based on
the age-related, state-approved foster family home care rate and any
applicable specialized care increment, for any adoption assistance
agreement entered into prior to October 1, 1992, or in any subsequent
reassessment for adoption assistance agreements executed before
January 1, 2008.
   (2) (A) Any county that, as of the 1991-92 fiscal year, receives
state participation for a basic rate that exceeds the amount set
forth in the schedule of basic rates in subdivision (a) shall receive
an increase each year in state participation for that basic rate of
one-half of the percentage adjustments specified in paragraph (1)
until the difference between the county's adjusted state
participation level for its basic rate and the adjusted schedule of
basic rates is eliminated.
   (B) Notwithstanding subparagraph (A), all counties for the
1999-2000 fiscal year and the 2007-08 fiscal year shall receive an
increase in state participation for the basic rate of the entire
percentage adjustment described in paragraph (1).
   (3) If a county has, after receiving the adjustments specified in
paragraph (2), a state participation level for a basic rate that is
below the amount set forth in the adjusted schedule of basic rates
for that fiscal year, the state participation level for that rate
shall be further increased to the amount specified in the adjusted
schedule of basic rates.
   (e) (1) As used in this section, "specialized care increment"
means an approved amount paid with state participation on behalf of
an AFDC-FC child requiring specialized care to a home listed in
subdivision (a) in addition to the basic rate. Notwithstanding
subdivision (a), the specialized care increment shall not be paid to
a nonminor dependent placed in a supervised independent living
setting as defined in subdivision (w) of Section 11403. On the
effective date of this section, the department shall continue and
maintain the current ratesetting system for specialized care.
   (2) Any county that, as of the effective date of this section, has
in effect specialized care increments that have been approved by the
department, shall continue to receive state participation for those
payments.
   (3) Any county that, as of the effective date of this section, has
in effect specialized care increments that exceed the amounts that
have been approved by the department, shall continue to receive the
same level of state participation as it received on the effective
date of this section.
   (4) (A) Except for subparagraph (B), beginning January 1, 1990,
specialized care increments shall be adjusted in accordance with the
methodology for the schedule of basic rates described in subdivisions
(c) and (d). No county shall receive state participation for any
increases in a specialized care increment which exceeds the
adjustments made in accordance with this methodology.
   (B) Notwithstanding subdivision (e) of Section 11460, for the
1993-94 fiscal year, an amount equal to 5 percent of the State
Treasury appropriation for family homes shall be added to the total
augmentation for the AFDC-FC program in order to provide incentives
and assistance to counties in the area of specialized care. This
appropriation shall be used, but not limited to, encouraging counties
to implement or expand specialized care payment systems, to recruit
and train foster parents for the placement of children with
specialized care needs, and to develop county systems to encourage
the placement of children in family homes. It is the intent of the
Legislature that in the use of these funds, federal financial
participation shall be claimed whenever possible.
   (C) (i) Notwithstanding subparagraph (A), the specialized care
increment shall not receive a cost-of-living adjustment in the
2011-12 or 2012-13 fiscal years.
   (ii) Notwithstanding clause (i), a county may choose to apply a
cost-of-living adjustment to its specialized care increment during
the 2011-12 or 2012-13 fiscal years. To the extent that a county
chooses to apply a cost-of-living adjustment during that time, the
state shall not participate in the costs of that adjustment.
   (iii) To the extent that federal financial participation is
available for a cost-of-living adjustment made by a county pursuant
to clause (ii), it is the intent of the Legislature that the federal
funding shall be utilized.
   (f) (1) As used in this section, "clothing allowance" means the
amount paid with state participation in addition to the basic rate
for the provision of additional clothing for an AFDC-FC child,
including, but not limited to, an initial supply of clothing and
school or other uniforms.
   (2) Any county that, as of the effective date of this section, has
in effect clothing allowances, shall continue to receive the same
level as it received on the effective date of this section.
   (3) (A) Commencing in the 2007-08 fiscal year, for children whose
foster care payment is the responsibility of Colusa, Plumas, and
Tehama Counties, the amount of the clothing allowance may be up to
two hundred seventy-four dollars ($274) per child per year.
   (B)  Each county listed in subparagraph (A) that elects to receive
the clothing allowance shall submit a Clothing Allowance Program
Notification to the department within 60 days after the effective
date of the act that adds this paragraph.
   (C) The Clothing Allowance Program Notification shall identify the
specific amounts to be paid and the disbursement schedule for these
clothing allowance payments.
   (4) (A) Beginning January 1, 1990, except as provided in paragraph
(5), clothing allowances shall be adjusted annually in accordance
with the methodology for the schedule of basic rates described in
subdivisions (c) and (d). No county shall be reimbursed for any
increases in clothing allowances which exceed the adjustments made in
accordance with this methodology.
   (B) (1) Notwithstanding subparagraph (A), the clothing allowance
shall not receive any cost-of-living adjustment in the 2011-12 or
2012-13 fiscal years.
   (2) Notwithstanding paragraph (1), a county may choose to apply a
cost-of-living adjustment to its clothing allowance during the
2011-12 or 2012-13 fiscal years. To the extent that a county chooses
to apply a cost-of-living adjustment during that time, the state
shall not participate in the costs of that adjustment.
   (3) To the extent that federal financial participation is
available for a cost-of-living adjustment made by a county pursuant
to paragraph (2), it is the intent of the Legislature that the
federal funding shall be utilized.
   (5) (A) For the 2000-01 fiscal year and each fiscal year
thereafter, without a county share of cost, notwithstanding
subdivision (c) of Section 15200, each child shall be entitled to
receive a supplemental clothing allowance of one hundred dollars
($100) per year subject to the availability of funds. The clothing
allowance shall be used to supplement, and not supplant, the clothing
allowance specified in paragraph (1).
   (B) Notwithstanding subparagraph (A), the state shall no longer
participate in the supplemental clothing allowance commencing with
the 2011-12 fiscal year.
   (g) (1) Notwithstanding subdivisions (a) to (d), inclusive, for a
child, or on and after January 1, 2012, a nonminor dependent, placed
in a licensed or approved family home with a capacity of six or less,
or placed in an approved home of a relative or the approved home of
a nonrelative extended family member as described in Section 362.7,
or placed on and after January 1, 2012, in a supervised independent
living setting, as defined in subdivision (w) of Section 11400, the
per child per month basic rate in the following schedule shall be in
effect for the period commencing July 1, 2011, or the date specified
in the final order, for which the time to appeal has passed, issued
by a court of competent jurisdiction in California State Foster
Parent Association v. William Lightbourne, et al. (U.S. Dist. Ct. C
07-08056 WHA), whichever is earlier, through June 30, 2012:
Age                                    Basic rate
  0-4................................      $609
  5-8................................      $660
  9-11...............................      $695
12-14...............................      $727
15-20...............................      $761


   (2) Commencing July 1, 2011, the basic rate set forth in this
subdivision shall be annually adjusted on July 1 by the annual
percentage change in the California Necessities Index applicable to
the calendar year within which each July 1 occurs.
   (3) Subdivisions (e) and (f) shall apply to payments made pursuant
to this subdivision.
  SEC. 54.  Section 11462.04 of the Welfare and Institutions Code is
amended to read:
   11462.04.  (a) (1) Notwithstanding any other law, no new group
home rate or change to an existing rate shall be established pursuant
to Section 11462. An application shall not be accepted or processed
for any of the following:
   (A) A new program.
   (B) A new provider.
   (C) A program change, such as a rate classification level
increase.
   (D) A program capacity increase.
   (E) A program reinstatement.
   (2) Notwithstanding paragraph (1), the department may grant
exceptions as appropriate on a case-by-case basis, based upon a
written request and supporting documentation provided by county
placing agencies, including county welfare or probation directors.
   (b) Immediately prior to the inoperative date of this section, the
department shall provide feedback regarding the implementation of
this section to the Legislature.
   (c) This section shall become inoperative on January 1, 2013, and
as of that date is repealed, unless a later enacted statute, that
becomes operative before January 1, 2013, deletes or extends that
date.
  SEC. 55.  Section 11465 of the Welfare and Institutions Code is
amended to read:
   11465.  (a) When a child is living with a parent who receives
AFDC-FC or Kin-GAP benefits, the rate paid to the provider on behalf
of the parent shall include an amount for care and supervision of the
child.
   (b) For each category of eligible licensed community care
facility, as defined in Section 1502 of the Health and Safety Code,
the department shall adopt regulations setting forth a uniform rate
to cover the cost of care and supervision of the child in each
category of eligible licensed community care facility.
   (c) (1) On and after July 1, 1998, the uniform rate to cover the
cost of care and supervision of a child pursuant to this section
shall be increased by 6 percent, rounded to the nearest dollar. The
resultant amounts shall constitute the new uniform rate.
   (2) (A) On and after July 1, 1999, the uniform rate to cover the
cost of care and supervision of a child pursuant to this section
shall be adjusted by an amount equal to the California Necessities
Index computed pursuant to Section 11453, rounded to the nearest
dollar. The resultant amounts shall constitute the new uniform rate,
subject to further adjustment pursuant to subparagraph (B).
   (B) In addition to the adjustment specified in subparagraph (A),
on and after January 1, 2000, the uniform rate to cover the cost of
care and supervision of a child pursuant to this section shall be
increased by 2.36 percent, rounded to the nearest dollar. The
resultant amounts shall constitute the new uniform rate.
   (3) Subject to the availability of funds, for the 2000-01 fiscal
year and annually thereafter, these rates shall be adjusted for cost
of living pursuant to procedures in Section 11453.
   (4) On and after January 1, 2008, the uniform rate to cover the
cost of care and supervision of a child pursuant to this section
shall be increased by 5 percent, rounded to the nearest dollar. The
resulting amount shall constitute the new uniform rate.
                                            (d) (1) Notwithstanding
subdivisions (a) to (c), inclusive, the payment made pursuant to this
section for care and supervision of a child who is living with a
teen parent in a whole family foster home, as defined in Section
11400, shall equal the basic rate for children placed in a licensed
or approved home as specified in subdivisions (a) to (d), inclusive,
and subdivision (g), of Section 11461.
   (2) The amount paid for care and supervision of a dependent infant
living with a dependent teen parent receiving AFDC-FC benefits in a
group home placement shall equal the infant supplement rate for group
home placements.
   (3) The caregiver shall provide the county child welfare agency or
probation department with a copy of the shared responsibility plan
developed pursuant to Section 16501.25 and shall advise the county
child welfare agency or probation department of any subsequent
changes to the plan. Once the plan has been completed and provided to
the appropriate agencies, the payment made pursuant to this section
shall be increased by an additional two hundred dollars ($200) per
month to reflect the increased care and supervision while he or she
is placed in the whole family foster home.
   (4) In any year in which the payment provided pursuant to this
section is adjusted for the cost of living as provided in paragraph
(1) of subdivision (c), the payments provided for in this subdivision
shall also be increased by the same procedures.
   (5) A Kin-GAP relative who, immediately prior to entering the
Kin-GAP program, was designated as a whole family foster home shall
receive the same payment amounts for the care and supervision of a
child who is living with a teen parent they received in foster care
as a whole family foster home.
   (6) On and after January 1, 2012, the rate paid for a child living
with a teen parent in a whole family foster home as defined in
Section 11400 shall also be paid for a child living with a nonminor
dependent parent who is eligible to receive AFDC-FC or Kin-GAP
pursuant to Section 11403.
  SEC. 56.  Section 11466.23 of the Welfare and Institutions Code is
amended to read:
   11466.23.  (a) It is the intent of the Legislature to comply with
the federal requirements of the Improper Payments Act of 2002 with
respect to the remittance of the federal share of foster care
overpayments.
   (b) For the purposes of this section, "federal foster care or
adoption assistance overpayment" means any amount of aid paid to
which a foster care provider or adoption assistance recipient was not
entitled, including any overpayment identified by a foster care
provider as described in Section 11400, or federal Adoption
Assistance Program recipient as described in Chapter 2.1 (commencing
with Section 16115) of Part 4, and on and after the date that the
director executes a declaration pursuant to Section 11217, any
federal Kin-GAP aid paid to which a related guardian was not
entitled, including any overpayment identified by a federal Kin-GAP
recipient as described in Article 4.7 (commencing with Section
11385).
   (c) Counties shall be required to remit the appropriate amount of
federal funds upon identification of the overpayment, following the
completion of due process.
   (1) Counties shall not be required to repay the overpayment when
any of the following occurs:
   (A) The amount is legally uncollectible, including any amount
legally uncollectible pursuant to Section 11466.24.
   (B) The cost of collection exceeds the overpayment.
   (C) The foster family agency or group home is no longer in
business or licensed by the department.
   (2) Remittance of overpayments of federal AFDC-FC, federal
Kin-GAP, and federal AAP funds not excluded by paragraph (1) shall be
shared by the state and the counties based on the following sharing
ratios:
   (A) For federal AFDC-FC funds, the sharing ratios described in
subdivision (c) of Section 15200.
   (B) For federal Kin-GAP funds, the sharing ratios described in
Section 10101.2.
   (C) For federal AAP funds, the sharing ratios described in
subdivision (e) of Section 15200.
   (3) Upon actual collection of any overpayments from providers or
recipients, the county shall ensure that the total amount reimbursed
to the state reflects the federal and state share of the overpayment
costs, as specified. All overpayments of federal AFDC-FC, federal
Kin-GAP, and federal AAP funds included in paragraph (1) shall be
repaid completely with state funds.
   (4) Nothing in this section shall inhibit existing county
authority to collect overpayments.
   (5) Nothing in this section shall inhibit existing county
responsibility to remit voluntary overpayments upon collection.
   (d) (1) The department shall adopt regulations to implement this
section by December 31, 2008. Notwithstanding Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code, the department, in consultation and coordination
with the County Welfare Directors Association, may adopt emergency
regulations to implement this section.
   (2) The adoption of emergency regulations pursuant to subdivision
(a) shall be deemed to be an emergency and necessary for the
immediate preservation of the public peace, health, safety, or
general welfare. The emergency regulations authorized by this section
shall be submitted to the Office of Administrative Law for filing
with the Secretary of State and shall remain in effect for no more
than 180 days, by which time final regulations shall be adopted.
   (e) The department may only require counties to remit payment of
the federal share for overpayments upon identification that occur on
or after the effective date of regulations adopted pursuant to this
section.
  SEC. 57.  Section 11487 of the Welfare and Institutions Code is
amended to read:
   11487.  (a) Whenever any aid under this chapter is repaid to the
state by means of child support collections, the state shall be
entitled to the amount received or recovered, except to the extent
that county and federal funds were expended. If funds advanced by the
federal government were paid, the federal government shall be
entitled to a share of the amount received or recovered,
proportionate to the amount of federal funds paid. Except as provided
in subdivision (b), if funds were paid by a county, the county shall
be entitled to a share of the amount received or recovered,
proportionate to the amount of county funds paid.
   (b) For the 2011-12 fiscal year, the county share of funds
received or recovered pursuant to subdivision (a) shall instead be
suspended and these funds shall be retained by the state.
  SEC. 58.  Section 11487.1 is added to the Welfare and Institutions
Code, to read:
   11487.1.  Except as provided in Sections 11457 and 11487, whenever
any aid under this chapter is repaid to a county or recovered by a
county, the state shall be entitled to a share of the amount received
or recovered, proportionate to the amount of state funds paid, and,
if funds advanced by the federal government were paid, the federal
government shall be entitled to a share of the amount received or
recovered, proportionate to the amount of federal funds paid.
  SEC. 59.  Section 12200.03 of the Welfare and Institutions Code is
amended to read:
   12200.03.  (a) Notwithstanding any other law, and subject to
subdivision (b), on the first day of the first month following 90
days after the effective date of the act that adds this section, the
maximum aid payment for an individual, as specified in Section 12200,
except subdivisions (e), (g), and (h) of that section, shall be
reduced to equal the minimum amount required by the federal Social
Security Act in order to maintain eligibility for federal funding
under Title XIX of the federal Social Security Act, contained in
Subchapter 19 (commencing with Section 1396) of Chapter 7 of Title 42
of the United States Code.
   (b) Notwithstanding subdivision (a), in no event shall the payment
schedules be reduced below the level of the state's March 1983
payment standards, as adjusted by the federal Social Security
Administration, pursuant to Section 416.2096(b) of Title 20 of the
Code of Federal Regulations.
  SEC. 60.  Section 12301.03 of the Welfare and Institutions Code is
amended to read:
   12301.03.  (a) (1) The Legislature finds and declares as follows:
   (A) Authorized hours under the In-Home Supportive Services program
were reduced in the 1992-93 fiscal year, and included a supplemental
assessment process that was intended to ensure that recipients
remained safely in their homes.
   (B) The reduction in authorized hours as provided for in Chapter 8
of the Statutes of 2011 includes a supplemental assessment process,
that is similarly intended to ensure that recipients remain safely in
their homes.
   (2) Notwithstanding any other provision of law, if the Department
of Finance determines that a reduction in authorized hours of service
is necessary, pursuant to subdivision (d) of Section 14132.957, the
department shall implement a reduction in authorized hours of service
to each in-home supportive services recipient as specified in this
section, which shall be applied to the recipient's hours as
authorized pursuant to his or her most recent assessment.
   (3) The reduction required by this section shall not preclude any
reassessment to which a recipient would otherwise be entitled.
However, hours authorized pursuant to a reassessment shall be subject
to the reduction required by this section.
   (4) For those recipients who have a documented unmet need,
excluding protective supervision, because of the limitations
contained in Section 12303.4, this reduction shall be applied first
to the unmet need before being applied to the authorized hours. If
the recipient believes he or she will be at serious risk of
out-of-home placement as a consequence of the reduction, the
recipient may apply for a restoration of the reduction of authorized
service hours, pursuant to Section 12301.05.
   (5) A recipient of services under this article may direct the
manner in which the reduction of hours is applied to the recipient's
previously authorized services.
   (6) The reduction in service hours made pursuant to paragraph (2)
shall not apply to in-home supportive services recipients who also
receive services under Section 9560, subdivision (t) of Section
14132, and Section 14132.99.
   (b) The department shall work with the counties to develop a
process to allow for counties to preapprove IHSS Care Supplements
described in Section 12301.05, to the extent that the process is
permissible under federal law. The preapproval process shall be
subject to the following conditions:
   (1) The preapproval process shall rely on the criteria for
assessing IHSS Supplemental Care applications, developed pursuant to
Section 12301.05.
   (2) Preapproval shall be granted only to individuals who would
otherwise be granted a full restoration of their hours pursuant to
Section 12301.05.
   (3) With respect to existing recipients as of the effective date
of this section, all efforts shall be made to ensure that counties
complete the process on or before a specific date, as determined by
the department, in consultation with counties in order to allow for
the production, printing, and mailing of notices to be issued to
remaining recipients who are not granted preapproval and who thereby
are subject to the reduction pursuant to this section.
   (4) The department shall work with counties to determine how to
apply a preapproval process with respect to new applicants to the
IHSS program who apply after the effective date of this section.
   (c)  The notice of action informing each recipient who is not
preapproved for an IHSS Care Supplement pursuant to subdivision (b)
shall be mailed at least 15 days prior to the reduction going into
effect. The notice of action shall be understandable to the recipient
and translated into all languages spoken by a substantial number of
the public served by the In-Home Supportive Services program, in
accordance with Section 7295.2 of the Government Code. The notice
shall not contain any recipient financial or confidential identifying
information other than the recipient's name, address, and Case
Management Information and Payroll System (CMIPS) client
identification number, and shall include, but not be limited to, all
of the following information:
   (1) The aggregate number of authorized hours before the reduction
pursuant to paragraph (2) of subdivision (a) and the aggregate number
of authorized hours after the reduction.
   (2) That the recipient may direct the manner in which the
reduction of authorized hours is applied to the recipient's
previously authorized services.
   (3) How all or part of the reduction may be restored, as set forth
in Section 12301.05, if the recipient believes he or she will be at
serious risk of out-of-home placement as a consequence of the
reduction.
   (d) The department shall inform providers of any reduction to
recipient hours through a statement on provider timesheets, after
consultation with counties.
   (e) The IHSS Care Supplement application process described in
Section 12301.05 shall be completed before a request for a state
hearing is submitted. If the IHSS Care Supplement application is
filed within 15 days of the notice of action required by subdivision
(c), or before the effective date of the reduction, the recipient
shall be eligible for aid paid pending. A revised notice of action
shall be issued by the county following evaluation of the IHSS Care
Supplement application.
   (f) (1) Notwithstanding the rulemaking provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code),
the department may implement and administer this section through
all-county letters or similar instruction from the department until
regulations are adopted. The department shall adopt emergency
regulations implementing this section no later than October 1, 2013.
The department may readopt any emergency regulation authorized by
this section that is the same as or substantially equivalent to an
emergency regulation previously adopted under this section.
   (2) The initial adoption of emergency regulations implementing
this section and the one readoption of emergency regulations
authorized by this subdivision shall be deemed an emergency and
necessary for the immediate preservation of the public peace, health,
safety, or general welfare. Initial emergency regulations and the
one readoption of emergency regulations authorized by this section
shall be exempt from review by the Office of Administrative Law. The
initial emergency regulations and the one readoption of emergency
regulations authorized by this section shall be submitted to the
Office of Administrative Law for filing with the Secretary of State
and each shall remain in effect for no more than 180 days, by which
time final regulations may be adopted.
   (g) If the Director of Health Care Services determines that
federal approval is necessary to implement this section, Section
12301.05, or both, these sections shall be implemented only after any
state plan amendments required pursuant to Section 14132.95 are
approved.
   (h) This section shall become operative on the first day of the
first month following 90 days after the effective date of Chapter 8
of the Statutes of 2011, or October 1, 2012, whichever is later.
  SEC. 61.  Section 12301.05 of the Welfare and Institutions Code is
amended to read:
   12301.05.  (a) Any aged, blind, or disabled individual who is
eligible for services under this chapter who receives a notice of
action indicating that his or her services will be reduced under
subdivision (a) of Section 12301.03 but who believes he or she is at
serious risk of out-of-home placement unless all or part of the
reduction is restored may submit an IHSS Care Supplement application.
When a recipient submits an IHSS Care Supplement application within
15 days of receiving the reduction notice or prior to the
implementation of the reduction, the recipient's in-home supportive
services shall continue at the level authorized by the most recent
assessment, prior to any reduction, until the county finds that the
recipient does or does not require restoration of any hours through
the IHSS Care Supplement. If the recipient disagrees with the county'
s determination concerning the need for the IHSS Care Supplement, the
recipient may request a hearing on that determination.
   (b) The department shall develop an assessment tool, in
consultation with stakeholders, to be used by the counties to
determine if a recipient is at serious risk of out-of-home placement
as a consequence of the reduction of services pursuant to section
12301.03. The assessment tool shall be developed utilizing standard
of care criteria for relevant out-of-home placements that serve
individuals who are aged, blind, or who have disabilities and who
would qualify for IHSS if living at home, including, but not limited
to, criteria set forth in Chapter 7.0 of the Manual of Criteria for
Medi-Cal Authorization published by the State Department of Health
Care Services, as amended April 15, 2004, and the IHSS uniform
assessment guidelines.
   (c) Counties shall give a high priority to prompt screening of
persons specified in this section to determine their need for an IHSS
Care Supplement.
   (d) (1) Notwithstanding the rulemaking provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code),
the department may implement and administer this section through
all-county letters or similar instruction from the department until
regulations are adopted. The department shall adopt emergency
regulations implementing this section no later than October 1, 2013.
The department may readopt any emergency regulation authorized by
this section that is the same as or substantially equivalent to an
emergency regulation previously adopted under this section.
   (2) The initial adoption of emergency regulations implementing
this section and the one readoption of emergency regulations
authorized by this subdivision shall be deemed an emergency and
necessary for the immediate preservation of the public peace, health,
safety, or general welfare. Initial emergency regulations and the
one readoption of emergency regulations authorized by this section
shall be exempt from review by the Office of Administrative Law. The
initial emergency regulations and the one readoption of emergency
regulations authorized by this section shall be submitted to the
Office of Administrative Law for filing with the Secretary of State,
and each shall remain in effect for no more than 180 days, by which
time final regulations may be adopted.
   (e) This section shall become operative on the first day of the
first month following 90 days after the effective date of Chapter 8
of the Statutes of 2011, or October 1, 2012, whichever is later.
  SEC. 62.  Section 12309.1 of the Welfare and Institutions Code is
amended to read:
   12309.1.  (a) As a condition of receiving services under this
article, or Section 14132.95 or 14132.952, an applicant for or
recipient of services shall obtain a certification from a licensed
health care professional, including, but not limited to, a physician,
physician assistant, regional center clinician or clinician
supervisor, occupational therapist, physical therapist, psychiatrist,
psychologist, optometrist, ophthalmologist, or public health nurse,
declaring that the applicant or recipient is unable to perform some
activities of daily living independently, and that without services
to assist him or her with activities of daily living, the applicant
or recipient is at risk of placement in out-of-home care.
   (1) For purposes of this section, a licensed health care
professional means an individual licensed in California by the
appropriate California regulatory agency, acting within the scope of
his or her license or certificate as defined in the Business and
Professions Code.
   (2) Except as provided in subparagraph (A) or (B) or subdivision
(c), the certification shall be received prior to service
authorization, and services shall not be authorized in the absence of
the certification.
   (A) Services may be authorized prior to receipt of the
certification when the services have been requested on behalf of an
individual being discharged from a hospital or nursing home and
services are needed to enable the individual to return safely to
their home or into the community.
   (B) Services may be authorized temporarily pending receipt of the
certification when the county determines that there is a risk of
out-of-home placement.
   (3) The county shall consider the certification as one indicator
of the need for in-home supportive services, but the certification
shall not be the sole determining factor.
   (4) The health care professional's certification shall include, at
a minimum, both of the following:
   (A) A statement by the professional, as defined in subdivision
(a), that the individual is unable to independently perform one or
more activities of daily living, and that one or more of the services
available under the IHSS program is recommended for the applicant or
recipient, in order to prevent the need for out-of-home care.
   (B) A description of any condition or functional limitation that
has resulted in, or contributed to, the applicant's or recipient's
need for assistance.
   (b) The department, in consultation with the State Department of
Health Care Services and with stakeholders, including, but not
limited to, representatives of program recipients, providers, and
counties, shall develop a standard certification form for use in all
counties that includes, but is not limited to, all of the conditions
in paragraph (4) of subdivision (a). The form shall include a
description of the In-Home Supportive Services program and the
services the program can provide when authorized after a social
worker's assessment of eligibility. The form shall not, however,
require health care professionals to certify the applicant's or
recipient's need for each individual service.
   (c) The department, in consultation with the State Department of
Health Care Services and stakeholders, as defined in subdivision (b),
shall identify alternative documentation that shall be accepted by
counties to meet the requirements of this section, including, but not
limited to, hospital or nursing facility discharge plans, minimum
data set forms, individual program plans, or other documentation that
contains the necessary information, consistent with the requirements
specified in subdivision (a).
   (d) The department shall develop a letter for use by counties to
inform recipients of the requirements of subdivision (a). The letter
shall be understandable to the recipient, and shall be translated
into all languages spoken by a substantial number of the public
served by the In-Home Supportive Services program, in accordance with
Section 7295.2 of the Government Code.
   (e) This section shall not apply to a recipient who is receiving
services in accordance with this article or Section 14132.95 or
14132.952 on the operative date of this section until the date of the
recipient's first reassessment following the operative date of this
section, as provided in subdivision (f).
   (1) The recipient shall be notified of the certification
requirement before or at the time of the reassessment, and shall
submit the certification within 45 days following the reassessment in
order to continue to be authorized for receipt of services.
   (2) A county may extend the 45-day period for a recipient to
submit the medical certification on a case-by-case basis, if the
county determines that good cause for the delay exists.
   (f) This section shall become operative on the first day of the
first month following 90 days after the effective date of Chapter 8
of the Statutes of 2011, or July 1, 2011, whichever is later.
   (g) The State Department of Health Care Services shall provide
notice to all Medi-Cal managed care plans, directing the plans to
assess all Medi-Cal recipients applying for or receiving in-home
supportive services, in order to make the certifications required by
this section.
   (h) If the Director of Health Care Services determines that a
Medicaid State Plan amendment is necessary to implement subdivision
(b) of Section 14132.95, this section shall not be implemented until
federal approval is received.
  SEC. 63.  Section 14021.30 is added to the Welfare and Institutions
Code, to read:
   14021.30.  (a) It is the intent of the Legislature to transfer to
the State Department of Health Care Services, no later than July 1,
2012, the administration of the Drug Medi-Cal program from the State
Department of Alcohol and Drug Programs. It is further the intent of
the Legislature that this transfer should happen efficiently and
effectively, with no unintended interruptions in service delivery.
This transfer is intended to do all of the following:
   (1) Improve access to alcohol and drug treatment services,
including a focus on recovery and rehabilitation services.
   (2) More effectively integrate the financing of services,
including the receipt of federal funds.
   (3) Improve state accountability and outcomes.
   (4) Provide focused, high-level leadership for behavioral health
services.
   (b) Effective July 1, 2012, the administrative functions for the
Drug Medi-Cal program that were previously performed by the State
Department of Alcohol and Drug Programs are transferred to the
department.
   (c) Notwithstanding subdivision (b), the department and the State
Department of Alcohol and Drug Programs may conduct transition
activities prior to July 1, 2012, that are necessary to ensure the
efficient and effective transfer of Drug Medi-Cal program functions
by that date in accordance with the transition plan described in
Section 14021.31.
  SEC. 64.  Section 14021.31 is added to the Welfare and Institutions
Code, to read:
   14021.31.  (a) The department, in collaboration with the State
Department of Alcohol and Drug Programs, shall develop an
administrative and programmatic transition plan to guide the transfer
of the Drug Medi-Cal program to the department effective July 1,
2012.
   (1) Commencing no later than July 15, 2011, the department,
together with the State Department of Alcohol and Drug Programs,
shall convene stakeholders to receive input from consumers, family
members, providers, counties, and representatives of the Legislature
concerning the transfer of the administration of Drug Medi-Cal
functions currently performed by the State Department of Alcohol and
Drug Programs to the department. This
                   consultation shall inform the creation of an
administrative and programmatic transition plan that shall include,
but is not limited to, the following components:
   (A) Plans for how to review monthly billing from counties to
monitor and prevent any disruptions of service to Drug Medi-Cal
beneficiaries during and immediately after the transition, and a
description of how the department intends to approach the longer-term
development of measures for access and quality of service.
   (B) A detailed description of the Drug Medi-Cal administrative
functions currently performed by the State Department of Alcohol and
Drug Programs.
   (C) Explanations of the operational steps, timelines, and key
milestones for determining when and how each of these functions will
be transferred. These explanations shall also be developed for the
transition of position and staff serving the Drug Medi-Cal program
and how these will relate to and align with positions for the
Medi-Cal program at the department. The department shall consult with
the Department of Personnel Administration in developing this aspect
of the transition plan.
   (D) A list of any planned or proposed changes or efficiencies in
how the functions will be performed, including the anticipated fiscal
and programmatic impacts of the changes.
   (E) A detailed organization chart that reflects the planned
staffing at the department, taking into account the requirements of
subparagraphs (A) to (C), inclusive, and includes focused, high-level
leadership for behavioral health issues.
   (F) A description of how stakeholders were included in the initial
planning process to formulate the transition plan, and a description
of how their feedback will be taken into consideration after
transition activities are underway.
   (2) The department, together with the State Department of Alcohol
and Drug Programs, shall convene and consult with stakeholders at
least once following production of a draft of the transition plan and
before submission of that plan to the Legislature. Continued
consultation with stakeholders shall occur in accordance with the
requirement in subparagraph (F) of paragraph (1).
   (3) The department shall provide the transition plan described in
paragraph (1) to all fiscal committees and appropriate policy
committees of the Legislature by October 1, 2011, and shall provide
additional updates to the Legislature during budget subcommittee
hearings after that date, as necessary.
   (b) The requirement for submitting a report imposed under
paragraph (3) of subdivision (a) is inoperative on October 1, 2015,
pursuant to Section 10231.5 of the Government Code.
  SEC. 65.  Section 14132.97 of the Welfare and Institutions Code is
amended to read:
   14132.97.  (a) (1) For purposes of this section, "waiver personal
care services" means personal care services authorized by the
department for persons who are eligible for either nursing or model
nursing facility waiver services.
   (2) Waiver personal care services shall satisfy all of the
following criteria:
   (A) The services shall be defined in the nursing and model nursing
facility waivers.
   (B) The services shall differ in scope from services that may be
authorized under Section 14132.95 or 14132.952.
   (C) The services shall not replace any hours of services
authorized or that may be authorized under Section 14132.95 or
14132.952.
   (b) An individual may receive waiver personal care services if all
of the following conditions are met:
   (1) The individual has been approved by the department to receive
services in accordance with a waiver approved under Section 1915(c)
of the federal Social Security Act (42 U.S.C. Sec. 1396n(c)) for
persons who would otherwise require care in a nursing facility.
   (2) The individual has doctor's orders that specify that he or she
requires waiver personal care services in order to remain in his or
her own home.
   (3) The individual chooses, either personally or through a
substitute decisionmaker who is recognized under state law for
purposes of giving consent for medical treatment, to receive waiver
personal care services, as well as medically necessary skilled
nursing services, in order to remain in his or her own home.
   (4) The waiver personal care services and all other waiver
services for the individual do not result in costs that exceed the
fiscal limit established under the waiver.
   (c) The department shall notify the administrator of the in-home
supportive services program in the county of residence of any
individual who meets all requirements of subdivision (b) and has been
authorized by the department to receive waiver personal care
services. The county of residence shall then do the following:
   (1) Inform the department of the services that the individual is
authorized to receive under Section 14132.95 or 14132.952 at the time
he or she becomes eligible for waiver personal care services.
   (2) Determine the individual's eligibility for services under
Section 14132.95 or 14132.952 if he or she is not currently
authorized to receive those services and if he or she has not been
previously determined eligible for those services.
   (3) Implement the department's authorization for waiver personal
care services for the individual at the quantity and scope authorized
by the department.
   (d) (1) Waiver personal care services approved by the department
for individuals who meet the requirements of subdivision (b) may be
provided in either of the following ways, or a combination of both:
   (A) By a licensed and certified home health agency participating
in the Medi-Cal program.
   (B) By one or more providers of personal care services under
Article 7 (commencing with Section 12300) of Chapter 3 and
subdivision (d) of Section 14132.95, when the individual elects, in
writing, to utilize these service providers.
   (2) The department shall approve waiver personal care services for
individuals who meet the requirements of subdivision (b) only when
the department finds that the individual's receipt of waiver personal
care services is necessary in order to enable the individual to be
maintained safely in his or her own home and community.
   (3) When waiver personal care services are provided by a licensed
and certified home health agency, the home health agency shall
receive payment in the manner by which it would receive payment for
any other service approved by the department.
   (4) When waiver personal care services are provided by one or more
providers of personal care services under Article 7 (commencing with
Section 12300) of Chapter 3 and subdivision (d) of Section 14132.95,
the providers shall receive payment on a schedule and in a manner by
which providers of personal care services receive payment. The State
Department of Social Services shall commence making payments for
waiver personal care services when its payment system has been
modified to accommodate those payments. No county shall be obligated
to administer waiver personal care services until the State
Department of Social Services payment system has been modified to
accommodate those payments. However, any county or public authority
or nonprofit consortium that administers the in-home supportive
services program and personal care services program may pay providers
for the delivery of waiver personal care services if it chooses to
do so. In such a case, the county, public authority, or nonprofit
consortium shall be reimbursed by the department for the waiver
personal care services authorized by the department and provided to
an individual upon submittal of documentation as required by the
waiver, and in accordance with the requirements of the department.
   (e) Waiver personal care services shall not count as alternative
resources in a county's determination of the amount of services an
individual may receive under Section 14132.95 or 14132.952.
   (f) Any administrative costs to the State Department of Social
Services, a county, or a public authority or nonprofit consortium
associated with implementing this section shall be considered
administrative costs under the waiver and shall be reimbursed by the
department.
   (g) Two hundred fifty thousand dollars ($250,000) is appropriated
from the General Fund to the State Department of Social Services for
the 1998-99 fiscal year for the purpose of making changes to the case
management, information, and payrolling system that are necessary
for the implementation of this section.
   (h) This section shall not be implemented until the department has
obtained federal approval of any necessary amendments to the
existing nursing facility and model nursing facility waivers and the
state plan under Title 19 of the federal Social Security Act (42
U.S.C. Sec. 1396 et seq.). Any amendments to the existing nursing
facility and model nursing facility waivers and the state plan which
are deemed to be necessary by the director shall be submitted to the
federal Health Care Financing Administration by April 1, 1999.
   (i) The department shall implement this section only to the extent
that its implementation results in fiscal neutrality, as required
under the terms of the waivers.
  SEC. 66.  Section 16120.05 of the Welfare and Institutions Code is
amended to read:
   16120.05.  The adoption assistance agreement shall, at a minimum,
specify the amount and duration of assistance, and that the amount is
subject to any applicable increases pursuant to the cost-of-living
adjustments established by statute. The date for reassessment of the
child's needs shall be set at the time of the initial negotiation of
the adoption assistance agreement, and shall, thereafter be set at
each subsequent reassessment. The interval between any reassessments
may not exceed two years.
   The adoption assistance agreement shall also specify the
responsibility of the adopting family for reporting changes in
circumstances that might negatively affect their ability to provide
for the identified needs of the child.
  SEC. 67.  Section 16121 of the Welfare and Institutions Code is
amended to read:
   16121.  (a) (1) For initial adoption assistance agreements
executed on October 1, 1992, to December 31, 2007, inclusive, the
adoptive family shall be paid an amount of aid based on the child's
needs otherwise covered in AFDC-FC payments and the circumstances of
the adopting parents, but that shall not exceed the basic foster care
maintenance payment rate structure in effect on December 31, 2007,
that would have been paid based on the age-related state-approved
foster family home rate, and any applicable specialized care
increment, for a child placed in a licensed or approved family home.
   (2) For initial adoption assistance agreements executed from
January 1, 2008, to December 31, 2009, inclusive, the adoptive family
shall be paid an amount of aid based on the child's needs otherwise
covered in AFDC-FC payments and the circumstances of the adopting
parents, but that shall not exceed the basic foster care maintenance
payment rate structure in effect on December 31, 2009, that would
have been paid based on the age-related state-approved foster family
home rate, and any applicable specialized care increment, for a child
placed in a licensed or approved family home.
   (3) Notwithstanding any other provision of this section, for
initial adoption assistance agreements executed on January 1, 2010,
to June 30, 2011, inclusive, or the effective date specified in a
final order, for which the time to appeal has passed, issued by a
court of competent jurisdiction in California State Foster Parent
Association, et al. v. William Lightbourne, et al., (U.S. Dist. Ct.
No. C 07-08056 WHA), whichever is earlier, where the adoption is
finalized on or before June 30, 2011, or the date specified in that
order, whichever is earlier the adoptive family shall be paid an
amount of aid based on the child's needs otherwise covered in AFDC-FC
payments and the circumstance of the adopting parents, but that
amount shall not exceed the basic foster care maintenance payment
rate structure in effect on June 30, 2011, or the date immediately
prior to the date specified in the order described in this paragraph,
whichever is earlier, and any applicable specialized care increment,
that the child would have received while placed in a licensed or
approved family home. Adoption assistance benefit payments shall not
be increased based solely on age. This paragraph shall not preclude
any reassessments of the child's needs, consistent with other
provisions of this chapter.
   (4) Notwithstanding any other provision of this section, for
initial adoption assistance agreements executed on or after July 1,
2011, or the effective date specified in a final order, for which the
time to appeal has passed, issued by a court of competent
jurisdiction in California State Foster Parent Association, et al. v.
William Lightbourne, et al. (U.S. Dist. Ct. No. C 07-05086 WHA),
whichever is earlier, where the adoption is finalized on or after
July 1, 2011, or the effective date of that order, whichever is
earlier, and for initial adoption assistance agreements executed
before July 1, 2011, or the date specified in that order, whichever
is earlier, where the adoption is finalized on or after the earlier
of July 1, 2011, or that specified date, the adoptive family shall be
paid an amount of aid based on the child's needs otherwise covered
in AFDC-FC payments and the circumstances of the adopting parents,
but that amount shall not exceed the basic foster family home rate as
set forth in paragraph (1) of subdivision (g) of Section 11461, plus
any applicable specialized care increment. These adoption assistance
benefit payments shall not be increased based solely on age. This
paragraph shall not preclude any reassessments of the child's needs,
consistent with other provisions of this chapter.
   (b) Payment may be made on behalf of an otherwise eligible child
in a state-approved group home or residential care treatment facility
if the department or county responsible for determining payment has
confirmed that the placement is necessary for the temporary
resolution of mental or emotional problems related to a condition
that existed prior to the adoptive placement. Out-of-home placements
shall be in accordance with the applicable provisions of Chapter 3
(commencing with Section 1500) of Division 2 of the Health and Safety
Code and other applicable statutes and regulations governing
eligibility for AFDC-FC payments for placements in in-state and
out-of-state facilities. The designation of the placement facility
shall be made after consultation with the family by the department or
county welfare agency responsible for determining the Adoption
Assistance Program (AAP) eligibility and authorizing financial aid.
Group home or residential placement shall only be made as part of a
plan for return of the child to the adoptive family, that shall
actively participate in the plan. Adoption Assistance Program
benefits may be authorized for payment for an eligible child's group
home or residential treatment facility placement if the placement is
justified by a specific episode or condition and does not exceed an
18-month cumulative period of time. After an initial authorized group
home or residential treatment facility placement, subsequent
authorizations for payment for a group home or residential treatment
facility placement may be based on an eligible child's subsequent
specific episodes or conditions.
   (c) (1) Payments on behalf of a child who is a recipient of AAP
benefits who is also a consumer of regional center services shall be
based on the rates established by the State Department of Social
Services pursuant to Section 11464 and subject to the process
described in paragraph (1) of subdivision (d) of Section 16119.
   (2) (A) Except as provided for in subparagraph (B), this
subdivision shall apply to adoption assistance agreements signed on
or after July 1, 2007.
   (B) Rates paid on behalf of regional center consumers who are
recipients of AAP benefits and for whom an adoption assistance
agreement was executed before July 1, 2007, shall remain in effect,
and may only be changed in accordance with Section 16119.
   (i) If the rates paid pursuant to adoption assistance agreements
executed before July 1, 2007, are lower than the rates specified in
paragraph (1) of subdivision (c) or paragraph (1) of subdivision (d)
of Section 11464, respectively, those rates shall be increased, as
appropriate and in accordance with Section 16119, to the amount set
forth in paragraph (1) of subdivision (c) or paragraph (1) of
subdivision (d) of Section 11464, effective July 1, 2007. Once set,
the rates shall remain in effect and may only be changed in
accordance with Section 16119.
   (ii) For purposes of this clause, for a child who is a recipient
of AAP benefits or for whom the execution of an AAP agreement is
pending, and who has been deemed eligible for or has sought an
eligibility determination for regional center services pursuant to
subdivision (a) of Section 4512, and for whom a determination of
eligibility for those regional center services has been made, and for
whom, prior to July 1, 2007, a maximum rate determination has been
requested and is pending, the rate shall be determined through an
individualized assessment and pursuant to subparagraph (C) of
paragraph (1) of subdivision (c) of Section 35333 of Title 22 of the
California Code of Regulations as in effect on January 1, 2007, or
the rate established in subdivision (b) of Section 11464, whichever
is greater. Once the rate has been set, it shall remain in effect and
may only be changed in accordance with Section 16119. Other than the
circumstances described in this clause, regional centers shall not
make maximum rate benefit determinations for the AAP.
   (3) Regional centers shall separately purchase or secure the
services contained in the child's IFSP or IPP, pursuant to Section
4684.
   (4) Regulations adopted by the department pursuant to this
subdivision shall be adopted as emergency regulations in accordance
with Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code, and for the purposes of
that chapter, including Section 11349.6 of the Government Code, the
adoption of these regulations is an emergency and shall be considered
by the Office of Administrative Law as necessary for the immediate
preservation of the public peace, health, safety, and general
welfare. The regulations authorized by this paragraph shall remain in
effect for no more than 180 days, by which time final regulations
shall be adopted.
   (d) (1) In the event that a family signs an adoption assistance
agreement where a cash benefit is not awarded, the adopting family
shall be otherwise eligible to receive Medi-Cal benefits for the
child if it is determined that the benefits are needed pursuant to
this chapter.
   (2) Regional centers shall separately purchase or secure the
services that are contained in the child's Individualized Family
Service Plan (IFSP) or Individual Program Plan (IPP) pursuant to
Section 4684.
   (e) Subdivisions (a), (b), and (d) shall apply only to adoption
assistance agreements signed on or after October 1, 1992. An adoption
assistance agreement executed prior to October 1, 1992, shall
continue to be paid in accordance with the terms of that agreement,
and shall not be eligible for any increase in the basic foster care
maintenance rate structure that occurred after December 31, 2007.
   (f) This section shall supersede the requirements of subparagraph
(C) of paragraph (1) of Section 35333 of Title 22 of the California
Code of Regulations.
   (g) The adoption assistance payment rate structure identified in
subdivisions (a) and (e) shall be adjusted by the percentage changes
in the California Necessities Index, beginning with the 2011-12
fiscal year, and shall not require a reassessment.
  SEC. 68.  Section 16121.01 of the Welfare and Institutions Code is
repealed.
  SEC. 69.  Section 16519.5 of the Welfare and Institutions Code is
amended to read:
   16519.5.  (a) The State Department of Social Services, in
consultation with county child welfare agencies, foster parent
associations, and other interested community parties, shall implement
a pilot program to establish a unified, family friendly, and
child-centered resource family approval process to replace the
existing multiple processes for licensing foster family homes,
approving relatives and nonrelative extended family members as foster
care providers, and approving adoptive families.
   (b) Up to five counties shall be selected to participate on a
voluntary basis in the pilot program, according to criteria developed
by the department in consultation with the County Welfare Directors
Association. In selecting the pilot counties, the department shall
promote diversity among the participating counties in terms of size
and geographic location.
   (c) (1) For the purposes of this section, "resource family" means
an individual or couple that a participating county determines to
have successfully met both the home approval standards and the
permanency assessment criteria adopted pursuant to subdivision (d)
necessary for providing care for a related or unrelated child who is
under the jurisdiction of the juvenile court, or otherwise in the
care of a county child welfare agency or probation department. A
resource family shall demonstrate all of the following:
   (A) An understanding of the safety, permanence, and well-being
needs of children who have been victims of child abuse and neglect,
and the capacity and willingness to meet those needs, including the
need for protection, and the willingness to make use of support
resources offered by the agency, or a support structure in place, or
both.
   (B) An understanding of children's needs and development,
effective parenting skills or knowledge about parenting, and the
capacity to act as a reasonable, prudent parent in day-to-day
decisionmaking.
   (C) An understanding of his or her role as a resource family and
the capacity to work cooperatively with the agency and other service
providers in implementing the child's case plan.
   (D) The financial ability within the household to ensure the
stability and financial security of the family.
   (E) An ability and willingness to maintain the least restrictive
and most familylike environment that serves the needs of the child.
   (2) Subsequent to meeting the criteria set forth in this
subdivision and designation as a resource family, a resource family
shall be considered eligible to provide foster care for related and
unrelated children in out-of-home placement, shall be considered
approved for adoption or guardianship, and shall not have to undergo
any additional approval or licensure as long as the family lives in a
county participating in the pilot program.
   (3) Resource family assessment and approval means that the
applicant meets the standard for home approval, and has successfully
completed a permanency assessment. This approval is in lieu of the
existing foster care license, relative or nonrelative extended family
member approval, and the adoption home study approval.
   (4) Approval of a resource family does not guarantee an initial or
continued placement of a child with a resource family.
   (d) Prior to implementation of this pilot program, the department
shall adopt standards pertaining to home approval and permanency
assessment of a resource family.
   (1) Resource family home approval standards shall include, but not
be limited to, all of the following:
   (A) (i) Criminal records clearance of all adults residing in the
home, pursuant to Section 8712 of the Family Code, utilizing a check
of the Child Abuse Central Index (CACI), a check of the Child Welfare
Services/Case Management System (CWS/CMS), receipt of a
fingerprint-based state criminal offender record information search
response, and submission of a fingerprint-based federal criminal
offender record information search.
   (ii) Consideration of any prior allegations of child abuse or
neglect against either the applicant or any other adult residing in
the home. An approval may not be granted to applicants whose criminal
record indicates a conviction for any of the offenses specified in
clause (i) of subparagraph (A) of paragraph (1) of subdivision (g) of
Section 1522 of the Health and Safety Code.
   (iii) Exemptions from the criminal records clearance requirements
set forth in this section may be granted by the director or the pilot
county, if that county has been granted permission by the director
to issue criminal records exemptions pursuant to Section 316.4, using
the exemption criteria currently used for foster care licensing as
specified in subdivision (g) of Section 1522 of the Health and Safety
Code.
   (B) Buildings and grounds, outdoor activity space, and storage
requirements set forth in Sections 89387, 89387.1, and 89387.2 of
Title 22 of the California Code of Regulations.
   (C) In addition to the foregoing requirements, the resource family
home approval standards shall also require the following:
   (i) That the applicant demonstrate an understanding about the
rights of children in care and his or her responsibility to safeguard
those rights.
   (ii) That the total number of children residing in the home of a
resource family shall be no more than the total number of children
the resource family can properly care for, regardless of status, and
shall not exceed six children, unless exceptional circumstances that
are documented in the foster child's case file exist to permit a
resource family to care for more children, including, but not limited
to, the need to place siblings together.
   (iii) That the applicant understands his or her responsibilities
with respect to acting as a reasonable and prudent parent, and
maintaining the least restrictive and most familylike environment
that serves the needs of the child.
   (D) The results of a caregiver risk assessment are consistent with
the factors listed in subparagraphs (A) to (D), inclusive, of
paragraph (1) of subdivision (c). A caregiver risk assessment shall
include, but not be limited to, physical and mental health, alcohol
and other substance use and abuse, and family and domestic violence.
   (2) The resource family permanency assessment standards shall
include, but not be limited to, all of the following:
   (A) The applicant shall complete caregiver training.
   (B) The applicant shall complete a psychosocial evaluation.
   (C) The applicant shall complete any other activities that relate
to a resource family's ability to achieve permanency with the child.
   (e) (1) A child may be placed with a resource family that has
received home approval prior to completion of a permanency assessment
                                              only if a compelling
reason for the placement exists based on the needs of the child.
   (2) The permanency assessment shall be completed within 90 days of
the child's placement in the approved home, unless good cause exists
based upon the needs of the child.
   (3) If additional time is needed to complete the permanency
assessment, the county shall document the extenuating circumstances
for the delay and generate a timeframe for the completion of the
permanency assessment.
   (4) The county shall report to the department on a quarterly basis
the number of families with a child in an approved home whose
permanency assessment goes beyond 90 days and summarize the reasons
for these delays.
   (5) A child may be placed with a relative, as defined in Section
319, or nonrelative extended family member, as defined in Section
362.7, prior to home approval and completion of the permanency
assessment only on an emergency basis if all of the following
requirements are met:
   (A) Consideration of the results of a criminal records check
conducted pursuant to Section 16504.5 of the relative or nonrelative
extended family member and of every other adult in the home.
   (B) Consideration of the results of the Child Abuse Central Index
(CACI) consistent with Section 1522.1 of the Health and Safety Code
of the relative or nonrelative extended family member, and of every
other adult in the home.
   (C) The home and grounds are free of conditions that pose undue
risk to the health and safety of the child.
   (D) For any placement made pursuant to this paragraph, the county
shall initiate the home approval process no later than five business
days after the placement, which shall include a face-to-face
interview with the resource family applicant and child.
   (E) For any placement made pursuant to this paragraph, AFDC-FC
funding shall not be available until the home has been approved.
   (F) Any child placed under this section shall be afforded all the
rights set forth in Section 16001.9.
   (f) The State Department of Social Services shall be responsible
for all of the following:
   (1) Selecting pilot counties, based on criteria established by the
department in consultation with the County Welfare Directors
Association.
   (2) Establishing timeframes for participating counties to submit
an implementation plan, enter into terms and conditions for
participation in the pilot program, train appropriate staff, and
accept applications from resource families.
   (3) Entering into terms and conditions for participation in the
pilot program by counties.
   (4) Administering the pilot program through the issuance of
written directives that shall have the same force and effect as
regulations. Any directive affecting Article 1 (commencing with
Section 700) of Chapter 7 of Title 11 of the California Code of
Regulations shall be approved by the Department of Justice. The
directives shall be exempt from the rulemaking provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340)) of Part 1 of Division 3 of Title 2 of the Government Code.
   (5) Approving and requiring the use of a single standard for
resource family home approval and permanency assessment.
   (6) Adopting and requiring the use of standardized documentation
for the home approval and permanency assessment of resource families.

   (7) Requiring counties to monitor resource families including, but
not limited to, all of the following:
   (A) Investigating complaints of resource families.
   (B) Developing and monitoring resource family corrective action
plans to correct identified deficiencies and to rescind resource
family approval if compliance with corrective action plans is not
achieved.
   (8) Ongoing oversight and monitoring of county systems and
operations including all of the following:
   (A) Reviewing the county's implementation of the pilot program.
   (B) Reviewing an adequate number of approved resource families in
each participating county to ensure that approval standards are being
properly applied. The review shall include case file documentation,
and may include onsite inspection of individual resource families.
The review shall occur on an annual basis, and more frequently if the
department becomes aware that a participating county is experiencing
a disproportionate number of complaints against individual resource
family homes.
   (C) Reviewing county reports of serious complaints and incidents
involving approved resource families, as determined necessary by the
department. The department may conduct an independent review of the
complaint or incident and change the findings depending on the
results of its investigation.
   (D) Investigating unresolved complaints against participating
counties.
   (E) Requiring corrective action of counties that are not in full
compliance with the terms and conditions of the pilot program.
   (9) Terminating the participation of any county that fails to make
corrective action or who otherwise violates the terms and conditions
of participation in the pilot program.
   (10) Preparing or having prepared within 180 days after the
conclusion of the pilot program, and submitting to the Legislature, a
report on the results of the pilot program. The report shall include
all of the following:
   (A) An analysis, utilizing available data, of state and federal
data indicators related to the length of time to permanency including
reunification, guardianship and adoption, child safety factors, and
placement stability.
   (B) An analysis of resource family recruitment and retention
elements, including resource family satisfaction with approval
processes and changes regarding the population of available resource
families.
   (C) An analysis of cost, utilizing available data, including
funding sources.
   (D) An analysis of regulatory or statutory barriers to
implementing the pilot program on a statewide basis.
   (g) Counties participating in the pilot program shall be
responsible for all of the following:
   (1) Submitting an implementation plan, entering into terms and
conditions for participation in the pilot program, consulting with
the county probation department in the development of the
implementation plan, training appropriate staff, and accepting
applications from resource families within the timeframes established
by the department.
   (2) Complying with the written directives pursuant to paragraph
(4) of subdivision (f).
   (3) Implementing the requirements for resource family home
approval and permanency assessment and utilizing standardized
documentation established by the department.
   (4) Ensuring staff have the education and experience necessary to
complete the home approval and permanency assessment competently.
   (5) Approving and denying resource family applications, including
all of the following:
   (A) Rescinding home approvals and resource family approvals where
appropriate, consistent with the established standard.
   (B) Providing disapproved resource families requesting review of
that decision due process by conducting county grievance reviews
pursuant to the department's regulations.
   (C) Notifying the department of any decisions denying a resource
family's application or rescinding the approval of a resource family.

   (6) Updating resource family approval annually.
   (7) Monitoring resource families through all of the following:
   (A) Ensuring that social workers who identify a condition in the
home that may not meet the approval standards set forth in
subdivision (d) while in the course of a routine visit to children
placed with a resource family take appropriate action as needed.
   (B) Requiring resource families to comply with corrective action
plans as necessary to correct identified deficiencies. If corrective
action is not completed as specified in the plan, the county may
rescind the resource family approval.
   (C) Requiring resource families to report to the county child
welfare agency any incidents consistent with the reporting
requirements for licensed foster family homes.
   (8) Investigating all complaints against a resource family and
taking action as necessary. This shall include investigating any
incidents reported about a resource family indicating that the
approval standard is not being maintained.
   (A) The child's social worker shall not conduct the formal
investigation into the complaint received concerning a family
providing services under the standards required by subdivision (d).
To the extent that adequate resources are available, complaints shall
be investigated by a worker who did not initially perform the home
approval or permanency assessment.
   (B) Upon conclusion of the complaint investigation, the final
disposition shall be reviewed and approved by a supervising staff
member.
   (C) The department shall be notified of any serious incidents or
serious complaints or any incident that falls within the definition
of Section 11165.5 of the Penal Code. If those incidents or
complaints result in an investigation, the department shall also be
notified as to the status and disposition of that investigation.
   (9) Performing corrective action as required by the department.
   (10) Assessing county performance in related areas of the
California Child and Family Services Review System, and remedying
problems identified.
   (11) Submitting information and data that the department
determines is necessary to study, monitor, and prepare the report
specified in paragraph (10) of subdivision (f).
   (h) Approved relatives and nonrelated extended family members,
licensed foster family homes, or approved adoptive homes that have
completed the license or approval process prior to full
implementation of the pilot program shall not be considered part of
the pilot program. The otherwise applicable assessment and oversight
processes shall continue to be administered for families and
facilities not included in the pilot program.
   (i) Upon completion of the pilot program, the status of the
resource family's approval shall continue in full force and effect,
and the resource family shall be deemed approved for licensing,
relative and nonrelated extended family member approval,
guardianship, and adoption purposes.
   (j) The department may waive regulations that pose a barrier to
implementation and operation of this pilot program. The waiver of any
regulations by the department pursuant to this section shall apply
to only those counties participating in the pilot program and only
for the duration of the pilot program.
   (k) Resource families approved under this pilot program, who move
within a participating county or who move to another pilot program
county, shall retain their resource family status if the new building
and grounds, outdoor activity areas, and storage areas meet home
approval standards. The State Department of Social Services or pilot
county may allow a pilot program-affiliated individual to transfer
his or her subsequent arrest notification if the individual moves
from one pilot county to another pilot county, as specified in
subdivision (h) of Section 1522 of the Health and Safety Code.
   (l) (1) A resource family approved under this pilot program that
moves to a nonparticipating pilot program county shall lose its
status as a resource family. The new county of residence shall deem
the family approved for licensing, relative and nonrelated extended
family member approval, guardianship, and adoption purposes, under
the following conditions:
   (A) The new building and grounds, outdoor activity areas, and
storage areas meet applicable standards, unless the family is subject
to a corrective action plan.
   (B) There has been a criminal records clearance of all adults
residing in the home and exemptions granted, using the exemption
criteria currently used for foster care licensing, as specified in
subdivision (g) of Section 1522 of the Health and Safety Code.
   (2) A program-affiliated individual who moves to a nonpilot county
may not transfer his or her subsequent arrest notification from a
pilot county to the nonpilot county.
   (m) Implementation of the pilot program shall be contingent upon
the continued availability of federal Social Security Act Title IV-E
(42 U.S.C. Sec. 670) funds for costs associated with placement of
children with resource families assessed and approved under the
program.
   (n) Notwithstanding Section 11402, a child placed with a resource
family shall be eligible for AFDC-FC payments. A resource family
shall be paid an AFDC-FC rate pursuant to Sections 11460 and 11461.
Sharing ratios for nonfederal expenditures for all costs associated
with activities related to the approval of relatives and nonrelated
extended family members shall be in accordance with Section 10101.
   (o) The Department of Justice shall charge fees sufficient to
cover the cost of initial or subsequent criminal offender record
information and Child Abuse Central Index searches, processing, or
responses, as specified in this section.
   (p) Approved resource families under this pilot program shall be
exempt from all of the following:
   (1) Licensure requirements set forth under the Community Care
Facilities Act, commencing with Section 1500 of the Health and Safety
Code and all regulations promulgated thereto.
   (2) Relative and nonrelative extended family member approval
requirements set forth under Sections 309, 361.4, and 362.7, and all
regulations promulgated thereto.
   (3) Adoptions approval and reporting requirements set forth under
Section 8712 of the Family Code, and all regulations promulgated
thereto.
   (q) The pilot program shall be authorized to continue through the
end of the 2010-11 fiscal year, or through the end of the fifth full
fiscal year following the date that funds are made available for its
implementation, whichever of these dates is later.
   (r) Notwithstanding subdivision (q), implementation of this
section is suspended until January 1, 2012.
  SEC. 70.  Section 17021 of the Welfare and Institutions Code, as
amended by Section 40 of Chapter 8 of the Statutes of 2011, is
amended to read:
   17021.  (a) Any individual who is not eligible for aid under
Chapter 2 (commencing with Section 11200) of Part 3 as a result of
the 48-month limitation specified in subdivision (a) of Section 11454
shall not be eligible for aid or assistance under this part until
all of the children of the individual on whose behalf aid was
received, whether or not currently living in the home with the
individual, are 18 years of age or older.
   (b) Any individual who is receiving aid under Chapter 2
(commencing with Section 11200) of Part 3 on behalf of an eligible
child, but who is either ineligible for aid or whose needs are not
otherwise taken into account in determining the amount of aid to the
family pursuant to Section 11450 due to the imposition of a sanction
or penalty, shall not be eligible for aid or assistance under this
part.
   (c) This section shall not apply to health care benefits provided
under this part.
  SEC. 71.  (a) By January 10, 2012, the State Department of Social
Services, in partnership with the Office of Systems Integration and
stakeholders, including legislative staff and counties, shall do all
of the following:
   (1) Determine and describe the degree to which the Child Welfare
Services/Case Management System (CWS/CMS) satisfies all of the
following requirements:
   (A) Complies with applicable existing law, regulation, and policy.

   (B) Supports existing child welfare services practice, including,
but not limited to, key child welfare services functions, ease of
access to case and service information, multidisciplinary case
management, and ease of use.
   (C) Links to information that enhances investigation, case
management, or efficiency.
   (D) Provides ready access to data for reporting, planning,
management, and program outcome monitoring.
   (2) Determine the best approach or approaches to address any
missing functionalities that are critical to child welfare services
operations. Options shall include building functionality into the
existing CWS/CMS, restarting the CWS/Web procurement, or developing a
new procurement.
   (3) Assess and report on communication from the federal government
regarding system requirements, both by the January 10, 2012,
deadline, and thereafter, when the department receives additional
direction regarding federal requirements.
   (4) Recommend next steps, including a timeline, for implementing
approaches identified pursuant to paragraph (2).
   (b) (1) The requirement for submitting a report imposed under
subdivision (a) is inoperative on January 10, 2016, pursuant to
Section 10231.5 of the Government Code.
   (2) A report to be submitted pursuant to subdivision (a) shall be
submitted in compliance with Section 9795 of the Government Code.
  SEC. 72.  The State Department of Social Services, in consultation
with stakeholders including, but not limited to, counties and public
authorities, including representatives of the California Association
of Public Authorities, shall develop a new ratesetting methodology
for public authority administrative costs, to go into effect
commencing with the 2012-13 fiscal year.
  SEC. 73.  Sections 1 to 40, inclusive, of this act shall become
operative on January 1, 2012.
  SEC. 74.  It is the intent of the Legislature that foster care
rates increased pursuant to a final order, for which the time to
appeal has passed, by a court of competent jurisdiction in California
State Foster Parent Association, et al. v. William Lightbourne, et
al. (U.S. Dist. Ct. No. C. 07-05086 WHA) shall be retroactive to the
date specified in that order.
  SEC. 75.  (a) Notwithstanding the rulemaking provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code),
the department may implement and administer Sections 45, 47 to 50,
inclusive, 52, 53, 55, and 66 to 68, inclusive, of this act, through
all-county letters or similar instructions from the department until
regulations are adopted. The department shall adopt emergency
regulations implementing these provisions no later than July 1, 2012.
The department may readopt any emergency regulation authorized by
this section that is the same as or substantially equivalent to an
emergency regulation previously adopted under this section.
   (b) The initial adoption of emergency regulations pursuant to this
section and one readoption of emergency regulations shall be deemed
an emergency and necessary for the immediate preservation of the
public peace, health, safety, or general welfare. Initial emergency
regulations and the one readoption of emergency regulations
authorized by this section shall be exempt from review by the Office
of Administrative Law. The initial emergency regulations and the one
readoption of emergency regulations authorized by this section shall
be submitted to the Office of Administrative Law for filing with the
Secretary of State and each shall remain in effect for no more than
180 days, by which time final regulations may be adopted.
  SEC. 76.  If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.
  SEC. 77.  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.