BILL ANALYSIS Ó
AB 1350
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Date of Hearing: May 6, 2015
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Brian Maienschein, Chair
AB 1350
(Salas) - As Amended April 28, 2015
SUBJECT: Kern County Hospital Authority.
SUMMARY: Makes changes to existing law which authorizes the
Kern County Board of Supervisors (Board of Supervisors) to
establish the Kern County Hospital Authority (Authority).
Specifically, this bill:
1)Makes a number of changes to existing law which authorizes the
Board of Supervisors to establish by ordinance the Authority
and to allow for the transfer of the county-run Kern Medical
Center (KMC) to the Authority.
2)Defines "transfer of control of the medical center" to mean
"the transfer by the County to the Authority of the
maintenance, operation, management, and personnel of the
medical center, whether by lease, transfer of ownership, or
other means, as provided by, and subject to, any conditions
and limitations specified by the Board of Supervisors in the
enabling ordinance."
3)Adds to the list of terms and conditions the Board of
Supervisors may include in the enabling ordinance to transfer
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control to the Authority from Kern County (County), whether
funds of the Authority shall be deposited in the custody of,
and paid out solely through, the County's treasurer's office.
4)Changes the effective date from the date the County adopts the
enabling ordinance to transfer control to the Authority
instead to the actual date of the transfer of control to the
Authority in a number of provisions in existing law which
require the Authority to be bound by the terms of memoranda of
understanding (MOU) between the County and its employee
representatives and in several other provisions that provide
protections for employee benefits.
5)Requires the Authority to be treated as a public employer that
offered a plan of replacement benefits prior to January 1,
2013. Provides that the County's plan of replacement benefits
that was in effect prior to January 1, 2013, is deemed to be
the Authority's replacement plan for the sole purpose of
allowing the Authority to continue to offer the plan of
replacement benefits, immediately after the transfer for Kern
County Employees' Retirement Association members who meet
specified requirements.
6)Authorizes the Authority, if not otherwise required pursuant
to the enabling ordinance to deposit its funds in the county
treasury, to establish its own treasury.
7)Provides that the powers granted to the Authority, pursuant to
existing law, may be subject to any terms, conditions, and
limitations imposed by the County's enabling ordinance.
8)Adds physicians and other provider types and coverage
mechanisms to the list of services, coverage, and programs
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that the Authority has the same rights as the county with
respect to owning, operating, and providing.
9)Expands the County's authority to issue debt instruments,
beyond revenue anticipation notes, to provide by loan or
otherwise amounts necessary to the Authority to meets its
operating and capital needs.
10)Provides that existing law, which governs the Authority,
shall not be construed to limit the borrowing authority of the
County.
11)Authorizes the Board of Supervisors, as applicable, to hold
meetings relating to the Authority's trade secrets, as
specified.
12)Authorizes the Board of Supervisors to contract for services
or purchase items on behalf
of the Authority.
13)Provides that the Authority's governing body (Board of
Governors) has authority over procurement and contracts,
unless otherwise provided for and subject to the limitations
and conditions established in the enabling ordinance.
Requires the Authority to adopt written rules, regulations and
procedures with regard to procurement and contract functions.
14)Requires the Authority's ability to contract for personnel or
other services and items, as specified, to only be limited by
the provisions in this chapter and the Meyers-Milias-Brown
Act.
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15)Makes other technical and conforming changes.
16)Makes minor changes to the findings and declarations.
EXISTING LAW authorizes the Board of Supervisors to establish
the Authority, and specifies the Authority's governance, powers,
and procedures.
FISCAL EFFECT: None
COMMENTS:
1)Prior Legislation. Facing escalating costs, some county
hospitals have sought to restructure their governance or
affiliate with other hospitals in their areas. In these
instances, the Legislature has granted several counties the
ability to create health authorities, including Alameda [AB
2374 (Bates), Chapter 816, Statues of 1996], Monterey [AB 276
(Alejo), Chapter 686, Statutes of 2012], San Luis Obispo [SB
538 (O'Connell), Chapter 899, Statues of 1999], Santa Barbara,
and Sonoma (for dental).
Most recently, the Legislature passed AB 2546 (Salas), Chapter
613, Statues of 2014, which authorized the Board of
Supervisors to establish a separate Authority to govern the
County's medical center (KMC). AB 2546 contains several
provisions to ensure that healthcare services remain
accessible to patients regardless of their ability to pay and
that the Authority, as a separate entity from the County, will
still continue to serve as a hospital. AB 2546 also
established requirements for the Authority upon the transfer
of KMC employees.
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2)Bill Summary. This bill builds upon the authority granted to
the Kern County Board of Supervisors by AB 2546 to establish
the Authority and to transfer the medical center to the
separate Authority. This bill makes a number of changes to
the laws governing the transfer of KMC.
This bill is author-sponsored.
3)Author's Statement. According to the author, "KMC serves a
community of over 650,000 residents, including indigent
individuals with no other means of obtaining medical care. KMC
provides the only trauma care between Los Angeles and Fresno,
and is vital to training physicians through academic residency
and education programs.
"A hospital authority allows Kern County to benefit from the
cost savings that can be generated by operating under a
separate governance structure and provide opportunities for
increased flexibility, responsiveness, and innovation. The
law established extensive provisions intended to ensure the
medical center will continue to provide affordable,
high-quality health care services and that medical center
employees will have a seamless transition of wages, benefits,
and contracts without loss of rights or status. This bill
contains technical and clarifying changes to ensure the
successful transfer of KMC to an Authority."
4)Arguments in Support. Supporters argue that this bill makes a
number of changes to provide for a smooth and equitable
transition of KMC to a hospital authority.
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5)Arguments in Opposition. None on file.
REGISTERED SUPPORT / OPPOSITION:
Support
California State Council of the Service Employees International
Union (If Amended)
Kern County Board of Supervisors
Kern Health Systems
Opposition
None on file
Analysis Prepared by:Misa Lennox / L. GOV. / (916) 319-3958
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