BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 371| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: SB 371 Author: De León (D) Amended: 4/10/13 Vote: 27 - Urgency SENATE APPROPRIATIONS COMMITTEE : 7-0, 4/15/13 AYES: De León, Walters, Gaines, Hill, Lara, Padilla, Steinberg SUBJECT : Claims against the state SOURCE : Author DIGEST : This bill appropriates $15,557,808 from the General Fund (GF) to the Department of Justice (DOJ) to pay two settlements. Any funds appropriated in excess of the amounts required for payment of these claims shall 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 DOJ and the Department of Finance. These settlements were entered into lawfully by the state upon advice of counsel (DOJ). They are binding state obligations. This bill appropriates GF revenues to pay the following claims against the state: Doe v. State of California Los Angeles Superior Court, Case No. BC445151 $40,000 settlement CONTINUED SB 371 Page 2 On September 10, 2010, the plaintiffs filed suit, alleging that the State and then-Governor Schwarzenegger, in his official capacity, had failed to ensure that public school districts do not charge impermissible pupil fees. Plaintiffs also filed a first amendment complaint on April 7, 2011, alleging that the State and a number of individually-named state officials and departments (Education defendants) failed to ensure that public school districts do not charge impermissible student fees. Governor Brown's signing of AB 1575 (Lara, Chapter 776, Statutes of 2012) on September 29, 2012, has provided the plaintiffs with the relief they sought by their first amended complaint, with the exception of attorney's fees. The bill prohibits the assessment of fees by public schools on pupils for specified educational activities, requires the Department of Education (CDE) to distribute guidance to public schools regarding pupil fees, and establishes a complaint process to address allegations of the imposition of unlawful pupil fees. Plaintiffs' counsel, the American Civil Liberties Union, billed approximately $192,000 in fees and costs in litigating this case. On the grounds of the catalyst theory, plaintiffs requested $95,000 in attorney's fees to settle the case, $47,500 from the State, and $47,500 from the Education defendants. To avoid the expense of litigating the attorney's fees issue, the parties have agreed to resolve the attorney's fees and specify the form of dismissal of this matter through agreement. The CDE and the State Board of Education have agreed to the proposed settlement and have made payment from existing resources, while DOJ negotiated a reduced amount of $40,000. The petitioners had a strong basis for an attorney's fees claim based on the catalyst theory of recovery. Ragatz v. State of California (CalFire) Solano Superior Court, Case No. FCSO38995 $15,517,808 settlement This is a personal injury claim arising from a traffic accident. On July 14, 2011, an employee of the Department of Forestry and Fire Protection (CalFire) was responding to a fire in Yolo County. The employee failed to move his vehicle completely off the freeway prior to stopping, and failed to engage the vehicle's hazard lights. Ms. Ragatz sustained permanent, life-altering brain injuries when her vehicle collided with the CONTINUED SB 371 Page 3 state fire vehicle, which may have been obscured by smoke. On December 9, 2011, Ms. Ragatz, by and through her conservator, filed a personal injury suit. The plaintiff is young, faces uncertain employment prospects, and a lifetime of care. A settlement agreement was reached through mediation on December 17, 2012. The Attorney General's Office has evaluated the State's liability and has concluded that the $15 million settlement is an appropriate amount to resolve this litigation. The settlement agreement includes six months of interest applied to the settlement amount at a rate of 7%. FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes Local: No According to the Senate Appropriations Committee, one-time GF appropriation of $15,557,808 from the GF to DOJ in 2012-13 according to the following schedule: $40,000 to pay the settlement in Doe v. State of California, Los Angeles Superior Court, Case No. BC445151. $15,517,808 to pay the settlement in Ragatz v. State of California (CalFire), Solano Superior Court, Case No. FCSO38995. JA:k 4/15/13 Senate Floor Analyses SUPPORT/OPPOSITION: NONE RECEIVED **** END **** CONTINUED