BILL ANALYSIS                                                                                                                                                                                                    Ó


          |SENATE RULES COMMITTEE            |                        AB 234|
          |Office of Senate Floor Analyses   |                              |
          |1020 N Street, Suite 524          |                              |
          |(916) 651-1520         Fax: (916) |                              |
          |327-4478                          |                              |
                                    THIRD READING

          Bill No:  AB 234
          Author:   Gatto (D)
          Amended:  8/5/13 in Assembly
          Vote:     27 - Urgency

           SENATE APPROPRIATIONS COMMITTEE  :  7-0, 8/26/13
          AYES:  De León, Walters, Gaines, Hill, Lara, Padilla, Steinberg
          ASSEMBLY FLOOR  :  74-1, 8/19/13 - See last page for vote

           SUBJECT  :    Claims against the state:  payment

           SOURCE  :     Author

           DIGEST  :    This bill appropriates $20.75 million from the  
          General Fund (GF) to pay two settlements against the state.  Any  
          funds appropriated in excess of the amounts required for payment  
          of these claims would revert to the GF.

           ANALYSIS  :    This bill is one of several annual bills carried by  
          the chairs of the Appropriations Committees to provide  
          appropriation authority for legal settlements approved by  
          Department of Justice (DOJ) and the Department of Finance (DOF).  
           These settlements were entered into lawfully by the state upon  
          advice of DOJ.  They are binding state obligations.

          The Motor Vehicle Insurance Account (Account) is essentially a  
          state insurance fund into which state departments pay a premium,  
          based on a five-year rolling average of the department's costs,  
          to cover the costs of vehicle accident liability and  


                                                                     AB 234

          settlements.  Over the past three years, the Account averaged  
          $38 million per year in expenditures and $45 million in revenue.  

          Generally accident settlements involving a state vehicle would  
          be paid from the Account.  Due to the size of the two claims in  
          this bill, and a $15.6 million claim passed and chaptered in SB  
          371 (De Leon, Chapter 9, Statutes of 2013) earlier this year,  
          however, DOF recommended these claims be paid from the GF.  The  
          Account cannot bear the cost of these large settlements in one  
          year and the impact of the claims on the premiums of the  
          affected departments - the Department of Public Health (DPH) and  
          Department of Forestry and Fire Protection (CAL FIRE) - would  
          require a GF increase to its budget to cover the drain on the  

          This bill appropriates $20.75 million from the GF to pay two  
          settlements against the state.  Any funds appropriated in excess  
          of the amounts required for payment of these claims would revert  
          to the GF.

          The settlements to be funded by this bill are:

            Thomas v. State of California (DPH), Alameda Superior Court  

            This personal injury settlement arises from a December 9, 2011  
            motorcycle/automobile collision.  Plaintiff Eric Thomas was  
            riding his motorcycle on Doolittle Drive in San Leandro, when  
            he collided with a car driven by DPH Inspector, Peter Yattaw.   
            Mr. Yattaw was in the course and scope of his employment for  
            the DPH at the time of the collision.  Mr. Thomas is paralyzed  
            from the chest down as a result of the accident.  Mr. Thomas  
            initiated suit against the state.   

            The parties entered mediation with the agreement that Mr.  
            Thomas and Mr. Yattaw were equally at fault for the collision.  
             The agreement was based on accident reconstruction analyses.   
            The report of the San Leandro Police Department concluded Mr.  
            Thomas was speeding and Mr. Yattaw failed to yield to an  
            oncoming driver.  At mediation, the parties presented reports  
            from medical experts, life care planners and economists.   
            After negotiations, the state, represented by the Office of  
            the Attorney General, agreed to settle the lawsuit for  
            $5,750,000 with 40% ($2,300,000) to be used to purchase an  



                                                                     AB 234

            annuity to provide monthly payments for the medical care of  
            the plaintiff.    

            Amethyst Kirwin, et al. v. Timothy McClelland, et al., San  
            Bernardino Superior Court
            On August 1, 2012, a three-car traffic accident occurred on  
            the I-210 freeway in San Bernardino.  CAL FIRE Chief Timothy  
            McClelland, who was driving a state vehicle within the course  
            and scope of his employment, rear-ended Gregory Kirwin at 70  
            mph.  Mr. Gregory Kirwin was fatally injured.  Plaintiffs  
            Amethyst and Belle Kirwin, Mr. Kirwin's children (ages four  
            and seven at time of the accident), sued for wrongful death  
            negligence.  The state, on its own behalf and on behalf of  
            Chief McClelland, settled this case for $15 million, most of  
            which will be placed into a structured settlement and special  
            needs trusts for the support of Mr. Kirwin's children.

           Related Legislation
          SB 371 (de León, Chapter 9, Statutes of 2013) appropriated $15.6  
          million to pay for one settlement.

          SB 369 (de León, 2013) appropriates $414,054.01 from the GF and  
          various special funds to pay state claims.  The claims are for  
          155 stale dated warrants.  

           FISCAL EFFECT  :    Appropriation:  Yes   Fiscal Com.:  Yes    
          Local:  No

           ASSEMBLY FLOOR  :  74-1, 8/19/13
          AYES:  Achadjian, Alejo, Allen, Ammiano, Atkins, Bloom,  
            Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian  
            Calderon, Campos, Chau, Chesbro, Conway, Cooley, Dahle, Daly,  
            Dickinson, Donnelly, Eggman, Fong, Fox, Frazier, Beth Gaines,  
            Garcia, Gatto, Gomez, Gonzalez, Gordon, Gorell, Gray, Grove,  
            Hagman, Hall, Harkey, Roger Hernández, Holden, Jones,  
            Jones-Sawyer, Levine, Linder, Logue, Lowenthal, Maienschein,  
            Mansoor, Medina, Melendez, Mitchell, Morrell, Mullin,  
            Muratsuchi, Nazarian, Nestande, Olsen, Pan, Perea, Quirk,  
            Quirk-Silva, Rendon, Salas, Skinner, Stone, Ting, Wagner,  
            Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, John A.  



                                                                     AB 234

          NOES:  Chávez
          NO VOTE RECORDED:  Bigelow, Patterson, V. Manuel Pérez, Vacancy,  

          JA:k  8/29/13   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  NONE RECEIVED

                                   ****  END  ****