BILL ANALYSIS Ó SB 326 Page 1 Date of Hearing: July 8, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair SB 326 (Beall) - As Amended June 2, 2015 ----------------------------------------------------------------- |Policy |Health |Vote:|18 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill extends the sunset date of the $4 penalty assessment for Vehicle Code violations, other than parking offenses, and related funding provisions, from January 1, 2016 to January 1, 2018, to continue raising revenues to augment funding for SB 326 Page 2 emergency medical air transportation Medi-Cal providers. FISCAL EFFECT: 1)Penalty revenues of around $10 million per year for an additional two years, until 2018 (Emergency Medical Air Transportation Act Fund). Annual revenues will fluctuate depending on the number of vehicle code violations that result in convictions, as well as other factors. The numbers below are based on an assumption of $10 million in annual revenue. 2)Administrative costs, likely in the low hundreds of thousands (Emergency Medical Air Transportation Act Fund). 3)Reduced GF expenditures of around $2 million per year for Medi-Cal payments, by using penalty revenues to offset GF expenditures for emergency air ambulance services for Medi-Cal beneficiaries. 4)Annual expenditures of around $16 million per year for supplemental payments to private emergency air medical service providers (Emergency Medical Air Transportation Act Fund and federal funds). COMMENTS: 1)Purpose. This bill is intended to continue a funding augmentation for emergency medical air transportation that expires January 1, 2016. 2)Background. AB 2173 (Beall), Chapter 547, Statutes of 2010 SB 326 Page 3 (Emergency Medical Air Transportation Act), imposed an additional penalty of $4 upon every conviction involving a vehicle violation, except certain parking offenses, effective January 1, 2011. The bill required the county or court that imposed the fine to transfer the money to the Treasurer for deposit into the Emergency Air Medical Transportation Act (EMATA) Fund. After payment of the Department of Health Care Services's administrative costs, 20% of the remaining EMATA funds are used to offset the State's portion of the Medi?Cal reimbursement rate for emergency medical air transportation services. The remaining 80% of the fund is matched with federal funds and used to augment funding for air medical transportation by providing supplemental payments. 3)Penalty Assessments. In recent years, there has been increasing concern about the ever-growing burden of additional penalties, fines, and assessments applied to criminal and traffic convictions. The $4 penalty assessment that is the subject of this bill is one of numerous penalty assessments placed on traffic fines. Currently, a $100 traffic ticket becomes more than $500 when all the various assessments are included. In their analysis of this bill, the Department of Finance notes their concern with "traffic penalties as a funding mechanism for state programs, because these penalties place a financial burden on a narrow class of citizens for the costs of programs that should be properly borne by the public at large." The Lawyers' Committee for Civil Rights of the San Francisco Bay Area released a report in April 2015 titled "Not Just a Ferguson Problem: How Traffic Courts Drive Inequality in California" that recommends reforms to mitigate the harsh impact of traffic fines on low-income people, including reducing the burden of "exorbitant fines, fees, and assessments." The report points out that these fees perpetuate a cycle of poverty and inequality, given that low-income people are more likely to miss payments. When payments are missed, the report notes it results in a cycle of increasing fines and penalties, often culminating in suspension of drivers' licenses or even jail time for failure SB 326 Page 4 to pay, with concomitant poor labor market and social outcomes for these individuals. 4)Related Legislation. a) SB 85 (Committee on Budget and Fiscal Review), the public safety trailer bill of the 2015-16 budget, creates an amnesty program for fines and bail initially due on or before January 1, 2013, to be conducted in accordance with guidelines adopted by the Judicial Council. It also authorizes a low-income amnesty program participant to receive an additional reduction in his or her repayment amount. SB 85 is enrolled and pending action by the Governor. b) SB 405 (Hertzberg), in prior versions, contained many of the amnesty provisions that came to be included in SB 85. The amnesty provisions were amended out June 24, 2015, and the bill was amended to address a defendant's right to receive a court hearing or request an assessment be vacated. SB 405 is currently pending in the Assembly Transportation Committee. 5)Staff Comment. Although the $4 fee in this bill is a small percentage of the total amount of penalty assessments and surcharges, it is worth noting significant unintended consequences of the cumulative effect of these additional financial penalties for traffic and criminal violations. Analysis Prepared by:Lisa Murawski / APPR. / (916) 319-2081 SB 326 Page 5