BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 852 (Quirk) - Skilled nursing facility construction, alteration, or addition: review. Amended: July 10, 2013 Policy Vote: Health 9-0 Urgency: No Mandate: No Hearing Date: August 12, 2013 Consultant: Brendan McCarthy This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 852 would require the Office of Statewide Health Planning and Development to develop and meet reasonable timelines for the review of certain health facility construction plans. The bill authorizes the Office to raise the maximum fee charged for review to 2% of a project's construction costs. Fiscal Impact: One-time costs up to about $100,000 to update existing regulations (Hospital Building Fund). Ongoing costs of about $380,000 per year for additional staff to develop outreach materials, reduce plan review timelines, and provide consultation for project proponents (Hospital Building Fund). Ongoing additional fee revenues of about $150,000 per year from the authorized increased in the plan review fee (Hospital Building Fund). Background: Under current law, the Office of Statewide Health Planning and Development develops building standards for hospitals and reviews the design and construction of hospitals. For the purposes of the Seismic Safety Act, hospital is defined to include acute care hospitals, specialty hospitals, skilled nursing facilities, and intermediate care facilities. The Office of Statewide Health Planning and Development is authorized to collect an application fee to cover the costs to perform plan reviews. Application fees are limited to 2% of total estimated construction costs for general acute care hospitals and specialty hospitals and 1.5% of estimated AB 852 (Quirk) Page 1 construction costs for skilled nursing facilities and intermediate care facilities. Proposed Law: AB 852 would require the Office of Statewide Health Planning and Development to develop and meet reasonable timelines for the review of construction plans for skilled nursing facilities and intermediate care facilities. Specific provisions of the bill would: Require the Office to meet reasonable timelines for the review of documents, first review of new projects, backchecks, and amended construction documents; Require the Office to designate a staff member to provide consultation on projects relating to skilled nursing facilities or intermediate care facilities; Authorize the Office to seek outside assistance from qualified professional architectural or engineering firms; Authorize the Office to develop standardized requirements for common design concepts; Require the Office to work with stakeholders to develop educational programs intended to reduce document submission errors and reduce review times; Authorize the Office to raise the maximum fee charged for review to 2% of a project's construction costs. The provisions of the bill would sunset on January 1, 2019. Related Legislation: SB 563 (Galgiani) would require a person requesting a copy of plans from the Office of Statewide Health Planning and Development to pay for the costs of producing those plans. That bill is in the Assembly. Staff Comments: According to the Office, the amount of additional fee revenues that would be raised from raising the maximum application fee would not be sufficient to fully cover the increased costs that will occur from the bill. However, the Hospital Building Fund has an existing fund balance that is sufficient to cover the shortfall. Because the Hospital Building Fund is continuously appropriated in statute and this bill raises the revenues that will go into that fund, this bill makes an appropriation. AB 852 (Quirk) Page 2