BILL ANALYSIS Ó SENATE COMMITTEE ON BUDGET AND FISCAL REVIEW Senator Mark Leno, Chair 2015 - 2016 Regular Bill No: AB 116 Hearing Date: June 15, 2015 ----------------------------------------------------------------- |Author: |Committee on Budget | |----------+------------------------------------------------------| |Version: |January 9, 2015 Introduced | ----------------------------------------------------------------- ---------------------------------------------------------------- |Urgency: |No |Fiscal: |No | ---------------------------------------------------------------- ----------------------------------------------------------------- |Consultant|Peggy Collins | |: | | ----------------------------------------------------------------- Subject: Budget Act of 2015. Summary: This bill augments the Budget Act of 2014 to address various funding shortfalls. Background: This bill makes supplemental appropriations to the Budget Act of 2014 in order to address the following shortfalls: Department of Health Care Services : Increased costs are associated with hospital presumptive eligibility; a delay in Medi-Cal redeterminations; behavioral health treatment services; increased Medicare payments; a decrease in the projected managed care organization tax savings; and reduced federal drug rebates. These increased costs are partially offset by increased savings due to litigation settlements and additional drug rebates, for a total deficiency of $241.2 million General Fund (GF). Department of Developmental Services : Increased costs are associated with staffing adjustments at the state developmental centers; decertification of four intermediate care facility units at Sonoma Developmental Center; increased caseload and utilization costs for regional center consumers; and continuation costs for residents transitioning into the community from a developmental center. These increased costs are partially offset by a reduction in the estimated costs for the expansion of the secured treatment program at Porterville Developmental Center; reduced costs for the Fairview and Porterville developmental centers program improvement plan AB 116 (Committee on Budget) Page 2 of ? implementation; lower than anticipated costs associated with the state minimum wage increase; and the court action that has delayed implementation of federal overtime requirements, for a total deficiency of $170 million GF. California Correctional Health Care Services (Receiver) : Increased costs are associated with increased California Health Care Facility staffing; Valley Fever testing; new high-cost Hepatitis C treatment; increased pharmaceutical costs; and adjustments based on the medical acuity staffing model, for a total deficiency of $107.7 million GF. Department of General Services : Increased costs are associated with the ongoing external legal representation in the case of California First, LLP (CalFirst) v. State of California, for a total deficiency of $2.5 million GF. This case concerns a purchase and sale agreement whereby CalFirst agreed to purchase 11 properties owned by the state. According to the Administration, this agreement automatically terminated when CalFirst failed to post a second deposit, as required by the agreement. Homicide Trials : Under existing law, qualifying counties may seek reimbursement from the State Controller for extraordinary expenses associated with homicide trials. Two counties, Mariposa County in the case of People v. Cary Stayner and Lassen County in the case of People v. Joanne McElrath and Robin James, qualify for specified reimbursements, for a total supplemental cost of $72,000 GF. Public Utilities Commission : Increased costs are associated with the inclusion of wireless cell phones in the Universal Lifeline Telephone Service program, which provides discounted home phone and cell phone services to qualified families. This inclusion resulted in a 60 percent increase in claims, for a total deficiency of $96 million (Universal Lifeline Telephone Service Trust Administrative Committee Fund). Proposed Law and Fiscal Effect: This bill augments the Budget Act of 2014 by $521,541,114 GF and $96,000,000 (Special Funds) to address various funding shortfalls. Support: None on file AB 116 (Committee on Budget) Page 3 of ? Opposed: None on file -- END --