BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 1842 (Monning) - California Central Coast State Veterans
Cemetery
Amended: May 10, 2012 Policy Vote: VA 7-0
Urgency: No Mandate: No
Hearing Date: June 25, 2012
Consultant: Maureen Ortiz
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: AB 1842 authorizes the California Department of
Veterans Affairs (CDVA) to enter into financial agreements to
receive cash advances to the California Central Coast State
Veterans Cemetery at Fort Ord Endowment Fund for the purpose of
funding the initial planning and design for submission of a
grant proposal to the U.S. Department of Veterans Affairs. Any
such agreement would require review by the Department of
Finance, and must specify that there is no state repayment
exposure.
Fiscal Impact: Minor, absorbable costs to the Department of
Veterans Affairs for administering the cash advance. AB 1842
specifically requires the Department of Finance to review the
agreement and provides that the agreement must prohibit any
obligations of repayment from the state.
Background: The military base at Fort Ord was established in
1917, and in
1940 was declared a permanent Army post. In 1991, Fort Ord was
announced for closure by the United States Base Realignment and
Closure Commission. Prior to its closure, the Fort Ord Reuse
Authority (FORA) set aside 204 acres for the development of a
Central Coast Veterans' Cemetery.
Previous attempts at obtaining a national cemetery at the Fort
Ord location had failed because federal regulations prohibit the
development of a national veterans' cemetery within 75 miles of
another national veterans' cemetery. Fort Ord is located within
75 miles of the San Joaquin Valley National Veterans' Cemetery
in Gustine and currently has open spaces. An alternative to a
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national veterans' cemetery is the establishment of a state
cemetery. The Federal government will pay 100% of construction
costs for a state run veterans' cemetery, however, the state is
responsible for paying the annual maintenance and operation
costs which have been estimated at approximately
$500,000-$700,000 per year. Further, the state must provide a
commitment to maintain the cemetery along with the initial
application for construction funding. Numerous legislative
attempts to establish the creation of the cemetery at Fort Ord
have failed over the years due to the impact on the General Fund
for the appropriation of the maintenance funds.
AB 3035 (Laird) Chapter 291/2006 established the California
Central Coast State Veterans Cemetery at Ford Ord Endowment Fund
for the receipt of donations of personal property, including
cash or other gifts, to be used for the maintenance of the
veterans' cemetery. AB 3035 provided that once sufficient
revenue is generated, the plans for design and construction may
proceed.
AB 1757 (Monning) Chapter 450/2010, authorized money in the
endowment fund to be used to fund the plans for developing and
submitting the proposal for a cemetery.
There is currently one other state veterans' cemetery in
California, the Northern California Veterans Cemetery, which
opened in 2005 and is located in Redding.
Proposed Law: AB 1842 will authorize the Department of Veterans
Affairs to enter into an agreement for a cash advance and to use
the funds to cover the costs of submitting the design proposal
to the USDVA for a state run veterans cemetery. Upon approval
of the grant for a new cemetery and reimbursement of costs, the
cash advance will then be repaid.
Authorizing the endowment fund to accept a funding advance would
help the state complete its initial planning and application
required by the federal government (at a cost of about $2
million) for a grant that would cover plans and full
construction (an estimated $26 million). According to CDVA
there are virtually no funds in the endowment fund.
AB 1842 explicitly states there is no liability on the part of
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the state for a cash advance or a loan, and the agreement must
be reviewed and performed in consultation with the Department of
Finance. Upon reimbursement of costs from the grant program,
the CDVA must determine, and the Controller's Office must
certify, that sufficient funds remain in the Endowment Fund to
cover ongoing maintenance and operating costs before any
reimbursement for cash advances are made.