BILL ANALYSIS Ó AB 1615 Page 1 Date of Hearing: May 21, 2014 ASSEMBLY COMMITTEE ON APPROPRIATIONS Mike Gatto, Chair AB 1615 (Gatto) - As Amended: May 15, 2014 Policy Committee: Appropriations Vote: Urgency: Yes State Mandated Local Program: No Reimbursable: SUMMARY This urgency bill: 1)Appropriates $2.7 million from the State Board of Chiropractic Examiners' Fund to the Department of Justice (DOJ) to pay the settlement in Arbuckle v California Board of Chiropractic Examiners, et al. Any funds appropriated in excess of the amounts required for payment of these claims revert to the chiropractic fund. 2)Appropriates $157,000 from the General Fund to the Department of Justice to pay the judgment in Planning and Conservation League v. State, et al. Any funds appropriated in excess of the amounts required for the payment of this claim revert to the General Fund. FISCAL EFFECT 1)One-time special fund appropriation of $2,698,000 to DOJ to pay a legal settlement. 2)One-time GF appropriation of $157,000 to DOJ to pay a legal settlement. COMMENTS 1)Rationale. This bill is one of the bills carried by the chairs of the Appropriations Committees each year to provide appropriation authority for legal settlements approved by DOJ and the Department of Finance (DOF). These settlements were entered into lawfully by the state upon advice of counsel AB 1615 Page 2 (DOJ). They are binding state obligations. 2)Case Background. a) In Arbuckle v. California Board of Chiropractic Examiners, et al., (Court of Appeal, Third District, California, 2013 WL 3467054) the lawsuit resulted from a whistleblower complaint filed June 17, 2002. The complaint was filed by a Board of Chiropractic Examiners (Board) employee, who alleged the Board chair failed to pay her license renewal fee and that the Board failed to take action against the chair for practicing without an active license. On January 27, 2003, the State Personnel Board (SPB) filed a Notice of Findings that recommended dismissal of the complaint. The plaintiff failed to file a petition for hearing and the Notice of Findings was adopted by the SPB. On February 21, 2003, Arbuckle filed a civil action against the Board, alleging various unlawful retaliations related to the whistleblower complaint. On February 25, 2011, and after several appeals, the Board was ordered to pay $2,106,201 ($1,175,000 judgment, $926,452 attorneys' fees, and $4,749 plaintiff's costs and disbursements), along with interest (7% per year) from July 28, 2010 (the date of the original jury verdict). The estimated interest from July 28, 2010 to July 31, 2014, is $591,757.45. The Board's appeal failed. All appeals for the Board have been exhausted and the judgment is final. b) In Planning and Conservation League v. State (Super Ct., Alameda County, 2013, No. RG12626904) $157,000 ($155,000 for attorneys' fees and $395 for costs, plus interest accrued) represents the judgment granted in favor of the Planning and Conservation League against the Controller. The lawsuit involved a constitutional challenge to judicial review provisions in AB 900 (Buchanan, 2011), which provides for expedited judicial review of challenges to "environmental leadership projects." The judgment in the case declared Public Resources Code section 21185, subdivision (a)(1), enacted as part of AB 900, to be facially unconstitutional. Section 21185 required California Environmental Quality Act challenges to environmental leadership projects to be filed directly in the Court of Appeal. The judgment enjoins the State AB 1615 Page 3 Controller from spending funds to implement the code provision. AB 900 was amended following the ruling in the Planning and Conservation League case and now allows such challenges to be brought in any court with jurisdiction to hear writ petitions, including superior courts. Plaintiffs initially sought almost $700,000 in attorneys' fees, but the court ruled the fee request was not reasonable. 3)Related Legislation . a) AB 234 (Gatto), Statutes of 2013, appropriated $20.7 million to pay for two settlements. b) SB 371 (De Leon), Statutes of 2013, appropriated $15.6 million to pay for two settlements Analysis Prepared by : Geoff Long / APPR. / (916) 319-2081