BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 806| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ UNFINISHED BUSINESS Bill No: SB 806 Author: Senate Veterans Affairs Committee Amended: 9/1/11 Vote: 27 - Urgency SENATE VETERANS AFFAIRS COMMITTEE : 7-0, 06/14/11 AYES: Correa, Cannella, Berryhill, Negrete McLeod, Rubio, Runner, Lieu NO VOTE RECORDED: Calderon SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8 SENATE FLOOR : 37-0, 07/11/11 (Consent) AYES: Alquist, Anderson, Berryhill, Blakeslee, Cannella, Correa, De León, DeSaulnier, Dutton, Emmerson, Evans, Fuller, Gaines, Hancock, Harman, Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu, Lowenthal, Negrete McLeod, Padilla, Price, Rubio, Runner, Simitian, Steinberg, Strickland, Vargas, Walters, Wolk, Wright, Wyland, Yee NO VOTE RECORDED: Calderon, Corbett, Pavley ASSEMBLY FLOOR : Not available SUBJECT : State employees: military leave: salary overpayment SOURCE : Author DIGEST : This bill extends, until January 1, 2015, the statute of limitations for the recovery of overpayments CONTINUED SB 806 Page 2 made to a state employee on a leave of absence for active military duty as a member of the California National Guard from three years to six years from the date of overpayment. Assembly Amendments (1) make provision applicable to any overpayment made up to 6 years prior to the operative date of this bill, (2) extend the statute of limitation until January 1, 2015, (3) clarify the circumstances under which the state must initiate administrative action to recover an overpayment to an employee of the state on leave of absence for active military duty as a member of the California National Guard, (4) establish that the state is not mandated to recover such an overpayment should various conditions apply, as specified, and (5) clarify administrative action to recover overpayment shall be initiated within six years from the date of overpayment, unless all of the following conditions exist: (a) the employee currently holds the military pay grade of E-1 to E-5, inclusive, (b) overpayment was not due to fraud, misrepresentation, or willful nondisclosure on the part of the employee, (c) overpayment was received without fault on the part of the employee, and (d) recovery of the overpayment from the employee would be against equity and good conscience. ANALYSIS : Existing law allows for the state to recover overpayment of funds to guard personnel as long as the proceedings are initiated within three years. Existing law provides that a state employee who is granted a military leave of absence for active duty, whose continuous state service is not broken by a permanent separation, shall be entitled to receive his or her salary for a period not to exceed 30 calendar days in any one fiscal year. This bill: 1.Determines, until January 1, 2015, if the state finds, that an overpayment of compensation has been made to a state employee on a leave of absence for active military duty as a member of the California National Guard. SB 806 Page 3 2.States that if #1 above is determined then administrative action to recover salary overpayment must be initiated within six years from the date of overpayment, notwithstanding existing law. 3.Establishes that the state is not mandated to recover such an overpayment if all of the following conditions apply: A. The recipient currently holds the military pay grade of E-1 through E-5, inclusive; B. The overpayment was not due to fraud, misrepresentation or willful nondisclosure on the part of the recipient; C. The overpayment was received without fault on the part of the recipient, and, D. Recovery of the overpayment would be against equity and good conscience. Background Overpayments to guard personnel have been well documented over the last 9 months and investigations by the Senate Veterans Affairs Committee continue to find more discrepancies with state military pay. Many of the documented discrepancies date to at least 2008. The new Adjutant General has only been recently appointed and is still investigating these records with the help of his staff. At this point, even if he finds something, it is likely he will find it too late to do anything about it. According to the author's office, this bill could not be simpler. If this bill is not passed, then the state loses its ability to recover improperly paid compensation on a price tag that is still unknown but could easily reach over $100 million. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: No According to the Assembly Appropriations Committee, minor SB 806 Page 4 absorbable administrative costs, particularly to the State Controller's Office. Costs will be offset to an unknown degree by recovering overpayments. RM:nl 9/8/11 Senate Floor Analyses SUPPORT/OPPOSITION: NONE RECEIVED **** END ****