BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          SB 580 (Leno) - Crime victims: trauma recovery center grants.
          
          Amended: April 17, 2013         Policy Vote: Public Safety 7-0
          Urgency: No                     Mandate: No
          Hearing Date: May 23, 2013      Consultant: Jolie Onodera
          
          SUSPENSE FILE.
          
          
          Bill Summary: SB 580 would authorize the California Victim  
          Compensation and Government Claims Board (VCGCB) to administer a  
          grant program to award, upon appropriation of the Legislature,  
          up to $2 million annually to trauma recovery centers (TRCs), as  
          defined. This bill also contains codified legislative findings  
          and declarations.

          Fiscal Impact: Annual costs of up to $2 million from the  
          Restitution Fund (Special Fund), subject to appropriation by the  
          Legislature and specific Restitution Fund reserve thresholds,  
          for grants to be awarded to TRCs. Increased administrative  
          workload to VCGCB to develop criteria for granting awards,  
          monitor the use of grant funds, and facilitate applications for  
          federal matching grants.

          Background: The California Victim Compensation Program (CalVCP),  
          administered by the VCGCB, provides compensation for victims who  
          suffer physical or emotional injury, or the threat of physical  
          injury, as a direct result of a violent crime. Crimes covered by  
          the program include domestic violence, child abuse, sexual and  
          physical assault, homicide, human trafficking, robbery, and  
          vehicular manslaughter.

          Subject to specified eligibility criteria, CalVCP compensates  
          eligible victims for various crime-related expenses that are not  
          covered by other sources. Services covered include medical and  
          dental care, mental health services, income loss, funeral  
          expenses, home security, rehabilitation and relocation. Funding  
          for the program is provided by the Restitution Fund, which  
          derives its revenue from restitution fines and orders, diversion  
          fees, and penalty assessments levied on persons convicted of  
          crimes and traffic offenses. CalVCP also receives federal grant  
          monies from the Victims of Crime Act (VOCA).








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          In order to receive compensation, victims must apply and provide  
          specified documentation. The waiting period to receive  
          indication of application for compensation has been documented  
          to take up to three months or more to receive. 

          The TRC treatment model was developed in 2001 and utilizes a  
          multidisciplinary staff to provide direct mental health services  
          and treatment to victims while coordinating services with law  
          enforcement and other social service agencies at the center. AB  
          50 (Leno) Chapter 884/2006 appropriated $1.3 million from the  
          Restitution Fund in FY 2006-07 for the TRC at San Francisco  
          General Hospital. 

          Proposed Law: This bill would authorize the VCGCB to administer  
          a program to evaluate applications and award grants to TRCs, as  
          follows:

             Upon appropriation by the Legislature, authorizes VCGCB to  
             award grants of up to $2 million annually and specifies  
             grants must be funded solely from the Restitution Fund.
             Provides that grant awards to TRCs must demonstrate that  
             they serve as a community resource by providing services,  
             including making presentations and providing training to law  
             enforcement, community-based agencies, and other health care  
             providers on the identification and effects of violent crime,  
             as well as any other related criteria required by the board.
             Authorizes VCGCB to award a grant providing funding for up  
             to a maximum period of three years, with any unexpended funds  
             after the specified grant period reverting to the Restitution  
             Fund. Prohibits TRCs from receiving more than one grant for  
             any period of time.
             Provides that the VCGCB shall not receive, evaluate, or  
             approve applications for TRC grants in a fiscal year unless  
             the Restitution Fund is projected to have a year-end fund  
             reserve equal to, or greater than, 25 percent of total  
             budgeted expenditures for the fund, as projected in the  
             January Governor's budget.
             Provides that grants awarded to TRCs shall not result in a  
             year-end balance to the Restitution Fund of less than 25  
             percent of total budgeted expenditures for the fund, as  
             projected in the January Governor's budget.
             Requires TRCs awarded grants to report to VCGCB annually on  
             how grant funds were spent, and in order to ensure federal  








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             compliance governing federal matching funds for victims'  
             services, each TRC must submit forms and data as requested to  
             allow the VCGCB to receive the 60 percent federal matching  
             funds for eligible victim services and allowable expenses.
             Defines a "trauma recovery center" as a center that provides  
             all of the following resources, treatments, and recovery  
             services to crime victims:
               (1) Mental health services.
               (2) Assertive community-based outreach and clinical case  
          management.
               (3) Coordination of care among medical and mental health  
               care providers, law enforcement agencies, and other social  
               services.
               (4) Services to family members and loved ones of homicide  
          victims.
               (5) A multidisciplinary staff of clinicians that includes  
               psychiatrists, psychologists, and social workers.

          Related Legislation: SB 733 (Leno) 2010 was substantially  
          similar to this measure. This bill was vetoed by the Governor  
          with the following message:

          I am returning Senate Bill 733 without my signature. While the  
          model of service supported by this bill has proven effective at  
          the San Francisco Trauma Recovery Center, the Restitution Fund  
          is an inappropriate ongoing source of funding for this type of  
          program. The Restitution Fund is the funding source of the  
          Victim Compensation Program, which was designated to pay for  
          certain out-of-pocket expenses to specific victims of crime.

          The use of the Restitution Fund to support programs of this type  
          presents a significant concern to its ongoing ability to support  
          the compensation of crime victims for which it was established.  
          For these reasons, I am unable to sign this bill.

          AB 1669 (Leno) 2007 was similar to SB 733 noted above, and was  
          also vetoed.

          AB 50 (Leno) Chapter 884/2006 reauthorized an interagency  
          agreement between the VCGCB and the University of California,  
          San Francisco, and appropriated $1.3 million from the  
          Restitution Fund in FY 2006-07 to provide services at the San  
          Francisco TRC.









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          Staff Comments: This bill requires the VCGCB to administer a  
          grant program for TRCs subject to a Legislative appropriation  
          and specific Restitution Fund reserve thresholds. The VCGCB  
          would receive applications and award grants totaling no more  
          than $2 million to one or more TRCs. This bill makes a  
          substantial appropriation, but to the extent the TRCs receiving  
          grants are successful, the state could potentially incur some  
          level of cost savings. These cost savings would, however, be  
          somewhat offset by an increased number of victims served under  
          this program.

          TRCs that would be eligible for the grants described in this  
          bill would be very similar to the San Francisco TRC in terms of  
          services provided. The San Francisco TRC has been very  
          successful at providing victim's services more cost effectively  
          than individual reimbursements to victims for seeking their own  
          mental health and medical services. In addition to the cost  
          containment for each individual victim that occurs when TRC as  
          the provider is paid by VCGCB (because it seeks to serve as many  
          people as possible, as opposed to a victim potentially incurring  
          more expensive services elsewhere), the TRC has served many more  
          victims in need of mental health services than the entire panel  
          of San Francisco fee-for-service providers. The TRC provides  
          services more efficiently, and is able to reach more people  
          (which often mitigate cost savings). If these services are  
          needed, however, there may be additional long term savings by  
          providing them to victims who would not otherwise seek them and  
          would have experienced an extended recovery period.

          The $2 million appropriation that will fund the grant program  
          may only come from the Restitution Fund, which is designed to  
          fund victims' services. The current system largely relies on  
          individual victims seeking mental health and medical services,  
          and subsequently applying to the VCGCB for reimbursement, which  
          can take an extended period of time.

          Requiring the VCGCB to administer the grant program will  
          increase existing workload. Additional administrative workload  
          would include developing criteria for grant awards, evaluating  
          grant applications from TRCs, monitoring the use of grant funds,  
          and facilitating applications for federal matching grants. A  
          Bureau of State Audits (BSA) report from December 2008 reported  
          that the administrative costs to support the program made up a  
          significant portion of the Restitution Fund disbursements for  








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          services and reported issues with the efficiency of  
          reimbursement processing and outreach efforts. The most recent  
          BSA report on Recommendations Not Fully Implemented After One  
          Year (January 2013 Report 2012-041), indicates an estimated  
          completion date of December 2013 for addressing  
          structural/operational issues and an as yet unknown date by  
          which VCGCB will define specific procedures to accomplish action  
          strategies for outreach and establish quantitative measures to  
          evaluate the effectiveness of its outreach efforts. Staff notes  
          that SB 1299 (Wright) Chapter 870/2012 became effective on  
          January 1, 2013, and made changes to streamline the VCGCB  
          guidelines for processing claims. 

          In FY 2011-12, $91million in victim's claims were paid through  
          direct payment to victims of $73.6 million and $13.4 million  
          through compacts with local agencies. The Governor's Budget  
          projects a Restitution Fund reserve balance of $55 million for  
          FY 2012-13 and $40 million for FY 2013-14. 

          The provisions of this bill provide that the VCGCB shall not  
          receive, evaluate, or approve applications for TRC grants in a  
          fiscal year unless the Restitution Fund is projected to have a  
          year-end fund reserve equal to, or greater than, 25 percent of  
          total budgeted expenditures for the fund, as projected in the  
          January Governor's budget. Further, this bill provides that  
          grants awarded to TRCs shall not result in a year-end balance to  
          the Restitution Fund of less than 25 percent of total budgeted  
          expenditures for the fund, as projected in the January  
          Governor's budget.

          Based on the 2013-14 Governor's Budget, total estimated  
          expenditures for the Restitution Fund are $120.5 million.  
          Twenty-five percent of budgeted expenditures would equate to  
          $30.1 million, within the allowance provisions of this bill.  
          Projections for the FY 2014-15 budget will not available until  
          January 2014, subsequent to the potential enactment date of this  
          measure. It should be noted that despite the current reserve  
          balance, the Restitution Fund has a structural imbalance with  
          expenditures exceeding revenues by approximately $15 million per  
          year. Extrapolating the operating deficit of $15 million to FY  
          2014-15, the estimated reserve would decline to $25 million,  
          below the threshold authorized for the VCGCB to accept and  
          approve applications for TRC grants.









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          Staff notes the VCGCB voted in FY 2011-12 to adopt a number of  
          reductions in the rates paid for specific types of services  
          provided. Due to the significant uncertainty of revenue  
          projections resulting from the implementation of 2011 Public  
          Safety Realignment, it was recommended at the January 2013 VCGCB  
          board meeting that no restorations to the rate reductions be  
          made at that time. Additionally, the full impact on the  
          Restitution Fund due to enactment of SB 1299 (Wright), which  
          tripled the time period allowed for crime victims to apply for  
          financial assistance for crime-related expenses, has yet to  
          occur, as the bill's provisions recently became effective on  
          January 1, 2013.