BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Christine Kehoe, Chair AB 1531 (Fuentes) - State claims. Amended: April 19, 2012 Policy Vote: Not Applicable Urgency: Yes Mandate: No Hearing Date: June 4, 2012 Consultant: Bob Franzoia Pursuant to the committee's rules, the Suspense File rule does not apply to the provisions of this bill as claims are considered valid obligations of the state. Additionally, claims may have time sensitivity. Bill Summary: AB 1531 would appropriate $859,738.51 from the General Fund and special funds to pay state claims. The claims are for 273 stale dated warrants. Fiscal Impact: $789,202.20 appropriation from the General Fund (236 claims). $2,610.33 appropriation from the Public Employees' Health Care Fund (1). $23,372.09 appropriation from the Health Care Deposit Fund (2). $884.33 appropriation from the Unclaimed Property Fund (1). $246.00 appropriation from the State Highway Account, State Transportation Fund (state operations) (1). $34,928.75 appropriation from the State Highway Account, State Transportation Fund (capital outlay support) (2). $2,303.11 appropriation from the Motor Vehicle Account, State Transportation Fund (12). $3,459.38 appropriation from the Department of Social Services General Fund (7). $2,250.40 appropriation from the California Department of Correction and Rehabilitation General Fund (8). $481.92 appropriation from the Employment Development Department Contingent Fund (3). Background: The State Board of Control was established in 1945. It was revised and renamed the Victim Compensation and Government Claims Board by Chapter 1016/2000 (AB 2491, Jackson). Government Code 13928 requires the board to ensure that all claims have been approved by the board, and for which there exists no legally available appropriation, are submitted for AB 1531 (Fuentes) Page 1 legislative approval at least twice during each calendar year. In general, the board will approve claims in November and in February. Those claims are reported to the chairs of the Appropriations Committees who introduce bills appropriating General Funds and special funds to pay the claims. These bills may appropriate funds in amounts to the penny for tens to hundreds of claims, usually stale dated warrants. Government Code 906 provides for the payment of interest on claims approved by the board for which an appropriation has been made beginning 30 days after the effective date of the law by which the appropriation is enacted. Proposed Law: This bill appropriates funding for 273 stale dated warrants. The re-issuance of stale-dated warrants is the most prevalent claim approved by the board. For stale-dated warrants, the Controller must confirm that (1) the check was not cashed and has not been issued and (2) more than three years have elapsed since the check was issued and the monies have reverted to the General Fund or to the relevant special fund. For these warrants an appropriation is needed to reissue the payment. This category also may include state treasury bonds that have not been redeemed within ten years of their maturity date (there are no such claims in this bill), but the majority of warrants generally are for lost payroll or tax refund checks. Related Legislation: SB 1065 (Kehoe) would appropriate $167,329.15 from the General Fund for the payment of 93 claims approved by the board (Franchise Tax Board stale dated warrants). SB 1065 (Kehoe) is also on today's agenda.