Amended in Assembly August 19, 2016

Amended in Assembly June 14, 2016

Amended in Assembly May 25, 2016

Senate Bill No. 846

Introduced by begin delete Committee on Budget and Fiscal Review end delete begin insert Senator Anderson end insert

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(Principal coauthors: Assembly Members Alejo, Chau, Chiu, Gallagher, Cristina Garcia, Holden, Maienschein, Mark Stone, Ting, and Wagner)

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January 7, 2016

begin delete An act to amend Sections 5830 and 5847 of, and to add Part 3.9 (commencing with Section 5849.1) to Division 5 of, the Welfare and Institutions Code, relating to housing, and making an appropriation therefor, to take effect immediately, bill related to the budget. end delete begin insert An act to amend Sections 6001, 6001.1, 6008.6, 6011, 6013.1, 6013.3, 6013.5, 6015, 6016, 6019, 6021, 6022, 6026.7, 6029, 6030, 6060.2, 6060.25, 6086.5, 6140, and 6145 of, to add Sections 6134 and 6140.56 to, to add and repeal Section 6075.6 of, and to repeal Sections 6008.5, 6009.7, 6012, 6013.2, 6018, and 6026.5 of, the Business and Professions Code, relating to the State Bar. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 846, as amended, begin delete Committee on Budget and Fiscal Review end delete   begin insert Anderson end insert . begin delete No Place Like Home Program: establishment. end delete begin insert Attorneys: State Bar: board of trustees. end insert

begin insert

The State Bar Act provides for the licensure and regulation of attorneys by the State Bar of California, a public corporation governed by a board of trustees. That act requires 6 members of the 19-member board to be attorneys elected from State Bar Districts. That act requires protection of the public to be the highest priority for the State Bar and the board of trustees in exercising their licensing, regulatory, and disciplinary functions and requires protection of the public to be paramount whenever the protection of the public is inconsistent with any other interest sought to be promoted. That act prohibits the State Bar from awarding a contract for goods, services, or both, for an aggregate amount in excess of $50,000, or for information technology goods, services, or both, for an aggregate amount in excess of $100,000, except pursuant to specified public contracting provisions. That act provides that the State Bar is subject to the Bagley-Keene Open Meeting Act and the California Public Records Act, as specified. That act, until January 1, 2017, requires the board to charge an annual membership fee for active members of up to $315 for 2016. The act requires the board of trustees to elect or select the president, vice president, and treasurer of the State Bar, as specified. Existing law prohibits the Legislature, when the board of trustees places a charge upon or otherwise makes available all or any portion of the income or revenue from membership fees for the payment of security of an obligation of the State Bar and so long as any obligation remains unpaid, from reducing the maximum membership fee below the maximum in effect at the time the obligation is created or incurred and provides that this provision constitutes a covenant to the holder of such an obligation. The act requires the board of trustees to contract with the California State Auditor’s Office to conduct a performance audit of the State Bar’s operations, as specified. That act establishes the State Bar Court to act in the place of the board of trustees in the determination of disciplinary proceedings, as specified. That act authorizes the State Bar to raise additional revenue by any lawful means, including, but not limited to, the creation of foundations or not-for-profit corporations. That act requires the board to establish and administer a Client Security Fund to relieve or mitigate pecuniary losses caused by dishonest conduct of active members of the State Bar, as specified.

end insert begin insert

This bill would provide that the board of trustees consists of no more than 19 members and no fewer than 13 members and would require the board to transition to a 13-member board, as specified. The bill would remove from the board attorney members elected from State Bar Districts and would make conforming changes. The bill would require each appointing authority, when making appointments to the board after December 31, 2016, to consider appointing members who have demonstrated education or experience, or both, in one of 6 specified areas, including public finance. The bill would require that a minimum of 7 members of the board be public members, as appointed by specified entities, and would require members of the board to serve a term of 4 years. The bill would require the California Supreme Court to review the substance of any anticompetitive decision made by the board and specifies that California Supreme Court has the power to veto, modify, or take other appropriate actions over those decisions. The bill would require the California Supreme Court to select from the members of the board a chair and vice chair of the State Bar and would require the chair’s term to be 2 years.

end insert begin insert

This bill would require protection of the public as the highest priority for the State Bar and set the priority of the regulatory functions of the State Bar, as specified.

end insert begin insert

This bill would require the Attorney General to appoint a State Bar enforcement program monitor prior to March 31, 2017, and would require the enforcement program monitor to evaluate the disciplinary system and procedures of the State Bar, as specified. The bill would require the enforcement program monitor to submit an initial report no later than October 1, 2019, and to issue a final report before March 31, 2020. The bill would make these provisions inoperative on March 31, 2020, and would repeal the provisions as of January 1, 2021.

end insert begin insert

This bill would require the board of trustees to engage the services of an independent national or regional public accounting firm with at least 5 years of experience in governmental auditing for an audit of its revenues, expenditures, reserves, and its financial statements for each fiscal year and would require the California State Auditor, for the performance audit due in January 2017, to review all of the State Bar’s expenses, including, but not limited to, executive salaries, and would require that audit to also include a recommendation by the California State Auditor of the appropriate methodology for the State Bar to calculate the portion of administrative costs that are appropriately allocated to the sections of the State Bar. The bill would also require the California State Auditor to conduct a performance audit evaluating the State Bar’s progress in certain areas, including correcting any issues raised in prior California State Auditor audits, and would require the California State Auditor to report its findings and recommendations, as specified.

end insert begin insert

This bill would provide that access to records of the State Bar Court is subject to the rules and laws applicable to the judiciary instead of the California Public Records Act and would exempt the State Bar Court from the Bagley-Keene Open Meeting Act.

end insert begin insert

This bill would allow, beginning on and after January 1, 2016, the disclosure of specified information submitted by an applicant to the State Bar for admission and license to practice.

end insert begin insert

This bill, until January 1, 2018, would require the board to charge an annual membership fee in a specified amount for 2017. The bill would repeal the provision prohibiting the Legislature from reducing the maximum membership fee and would prohibit the State Bar from creating any foundation or nonprofit corporations, as specified. The bill would require the State Bar to conduct a thorough analysis of the Client Security Fund and to submit a report to the Legislature on its analysis of that fund by March 15, 2017, as specified.

end insert begin insert

Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

end insert begin insert

This bill would make legislative findings to that effect.

end insert begin delete

(1) The Mental Health Services Act (MHSA), an initiative measure enacted by the voters as Proposition 63 at the November 2, 2004, statewide general election, imposes a 1% tax on that portion of a taxpayer’s taxable income that exceeds $1,000,000 and requires that the revenue from that tax be deposited in the Mental Health Services Fund to fund various county mental health programs. The MHSA authorizes the Legislature to amend its provisions by a 2⁄3 vote, provided that the amendment is consistent with and furthers the intent of the act.

end delete begin delete

This bill would establish the No Place Like Home Program, to be administered by the Department of Housing and Community Development. The bill would require the department to award $2,000,000,000 through a competitive program among counties to finance capital costs, including, but not limited to, acquisition, design, construction, rehabilitation, or preservation, and to capitalize operating reserves, of permanent supportive housing for the target population, as specified. The bill would further require the department to allocate $1,800,000 to a competitive program, as specified, and would require that applicants meet specified requirements to be eligible to apply for funding and would require the department to evaluate applications using specified criteria. The bill would require the department to award moneys in four rounds, as provided. The bill would require the department to allocate $200,000,000 among all counties within this state based on a calculation that includes, among other considerations, the numbers of homeless persons residing in each county. The bill would establish, and continuously appropriate, the No Place Like Home Fund for these purposes. The bill would also appropriate $6,200,000 from the Mental Health Services Fund to the department to provide technical and application preparation assistance to counties. The bill would require counties to annually report to the department on activities funded under these provisions, as provided.

end delete begin delete

This bill would establish the No Place Like Home Program Advisory Committee, as specified, and require the committee to assist and advise the department in the implementation of the program, review and make recommendations on the department’s guidelines, review the department’s progress in distributing moneys pursuant to the program, and provide advise and guidance on statewide homelessness issues. The bill would also require the department to submit a report on the program to the Legislature by December 31 of each year, as specified, and, upon an appropriation for that purpose, to contract with a public or private research university in this state to evaluate the program, as provided.

end delete begin delete

(2)The MHSA, among other things, requires county health programs to develop plans for innovative programs, to be funded as provided, and requires that the innovative program have specified purposes, including increasing access to services. Existing law requires that the projects included in the innovative program portion of a county health plan meet specified requirements, including increasing access to underserved groups and increasing access to services.

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This bill would specify that the services required to be provided through these programs, among other things, may include the provision of permanent supportive housing.

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(3) This bill would declare that its provisions further the intent of the MHSA.

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(4) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

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Vote:  begin delete ²⁄₃ end delete begin insert majority end insert . Appropriation:  begin delete yes end delete begin insert no end insert . Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insert SECTION 1. end insert   

end insert

begin insert Section 6001 of the end insert begin insert Business and Professions
Code end insert begin insert is amended to read: end insert

6001.  

The State Bar of California is a public corporation. It is
hereinafter designated as the State Bar.

The State Bar has perpetual succession and a seal and it may sue
and be sued. It may, for the purpose of carrying into effect and
promoting its objectives:

(a) Make contracts.

(b) Borrow money, contract debts, issue bonds, begin delete notes end delete begin insert notes, end insert and
debentures and secure the payment or performance of its
obligations.

(c) Own, hold, use, begin delete manage end delete begin insert manage, end insert and deal in and with real
and personal property.

(d) Construct, alter, begin delete maintain end delete begin insert maintain, end insert and repair buildings and
other improvements to real property.

(e) Purchase, lease, obtain options upon, acquire by gift, bequest,
begin delete devise end delete begin insert devise, end insert or otherwise, any real or personal property or any
interest therein.

(f) Sell, lease, exchange, convey, transfer, assign, encumber,
pledge, dispose of any of its real or personal property or any
interest therein, begin delete including end delete begin insert including, end insert without begin delete limitation end delete begin insert limitation, end insert
all or any portion of its income or revenues from membership fees
paid or payable by members.

(g) Do all other acts incidental to the foregoing or necessary or
expedient for the administration of its affairs and the attainment
of its purposes.

Pursuant to those powers enumerated in subdivisions (a) to (g),
inclusive, it is recognized that the State Bar has authority to raise
revenue in addition to that provided for in Section 6140 and other
statutory provisions. The State Bar is empowered to raise that
additional revenue by any lawful begin delete means, including, but not limited
to, end delete begin insert means. However, as of December 31, 2016, end insert the begin delete creation of end delete begin insert State
Bar shall not create any end insert foundations or begin delete not-for-profit end delete begin insert nonprofit end insert
corporations.

The State Bar shall conspicuously publicize to its members in
the annual dues statement and other appropriate communications,
including its Web site and electronic communications, that its
members have the right to limit the sale or disclosure of member
information not reasonably related to regulatory purposes. In those
communications the State Bar shall note the location of the State
Bar’s privacy policy, and shall also note the simple procedure by
which a member may exercise his or her right to prohibit or restrict,
at the member’s option, the sale or disclosure of member
information not reasonably related to regulatory purposes. On or
before May 1, 2005, the State Bar shall report to the Assembly
and Senate Committees on Judiciary regarding the procedures that
it has in place to ensure that members can appropriately limit the
use of their member information not reasonably related to
regulatory purposes, and the number of members choosing to
utilize these procedures.

No law of this state restricting, or prescribing a mode of
procedure for the exercise of powers of state public bodies or state
agencies, or classes thereof, including, but not by way of limitation,
the provisions contained in Division 3 (commencing with Section
11000), Division 4 (commencing with Section 16100), and Part 1
(commencing with Section 18000) and Part 2 (commencing with
Section 18500) of Division 5, of Title 2 of the Government Code,
shall be applicable to the State Bar, unless the Legislature expressly
so declares. Notwithstanding the foregoing or any other law,
pursuant to Sections 6026.7 and 6026.11, the State Bar is subject
to the California Public Records Act (Chapter 3.5 (commencing
with Section 6250) of Division 7 of Title 1 of the Government
Code) and, commencing April 1, 2016, the Bagley-Keene Open
Meeting Act (Article 9 (commencing with Section 11120) of
Chapter 1 of Part 1 of Division 3 of Title 2 of the Government
Code).

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 6001.1 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6001.1.  

begin insert (a) end insert begin insert   end insert Protection of the public shall be the highest priority
for the State Bar of California and the board of trustees in
exercising their licensing, regulatory, and disciplinary functions.
begin delete Whenever end delete begin insert While the State Bar has jurisdiction over a broad array
of important legal functions, whenever end insert the protection of the public
is inconsistent with other interests sought to be promoted, the
protection of the public shall be paramount.

begin insert

(b) Because protection of the public requires that legal services
are provided in a competent, accessible, and ethical manner and
that the judicial system functions in a fair, impartial, and just
manner, protection of the public is defined as the core regulatory
function of the State Bar in the following order of priority:

end insert begin insert

(1) Attorneys shall be competent and ethical and comply with
all state and federal laws, as well as all standards of professional
conduct developed by the State Bar.

end insert begin insert

(2) Appropriate discipline shall be imposed upon attorneys who
fail to comply with those standards and appropriate legal sanctions
shall be imposed upon nonattorneys who attempt to practice law
without a license.

end insert begin insert

(3) Competent and professional legal services shall be equally
available and delivered without regard to income.

end insert begin insert

(4) The legal profession shall represent the broad diversity of
California.

end insert

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 6008.5 of the end insert begin insert Business and Professions Code end insert

begin insert is repealed. end insert

begin delete

6008.5.  

Whenever the board has pledged, placed a charge upon,
or otherwise made available all or any portion of the income or
revenue from membership fees for the payment of security of an
obligation of the State Bar or any interest thereon, and so long as
any such obligation or any interest thereon remains unpaid, the
Legislature shall not reduce the maximum membership fee below
the maximum in effect at the time such obligation is created or
incurred, and the provisions of this section shall constitute a
covenant to the holder or holders of any such obligation.

end delete

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 6008.6 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6008.6.  

begin insert (a) end insert begin insert   end insert The State Bar shall award no contract for goods,
services, or both, for an aggregate amount in excess of fifty
thousand dollars ($50,000), or for information technology goods,
services, or both, for an aggregate amount in excess of one hundred
thousand dollars ($100,000), except pursuant to the standards
established in Article 4 (commencing with Section 10335) of
Chapter 2 of Part 2 of Division 2 of the Public Contract begin delete Code. end delete
begin insert Code and approval of the board of trustees. end insert The State Bar shall
establish a request for proposal procedure by rule, pursuant to the
general standards established in Article 4 (commencing with
Section 10335) of Chapter 2 of Part 2 of Division 2 of the Public
Contract Code. For the purposes of this section, “information
technology” includes, but is not limited to, all electronic technology
systems and services, automated information handling, system
design and analysis, conversion voice, video, and data
communications, network systems, requisite facilities, equipment,
system controls, stimulation, electronic commerce, and all related
interactions between people and machines.

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(b) The board of trustees shall adopt policies and procedures
to require board approval of any contract that could impact the
State Bar’s ability to carry out its paramount duty to protect the
public.

end insert

begin insert

begin insert SEC. 5. end insert   

end insert

begin insert Section 6009.7 of the end insert begin insert Business and Professions Code end insert

begin insert is repealed. end insert

begin delete

6009.7.  

(a) (1) The State Bar shall determine the manner by
which to reduce the board of trustees from 23 members to 19
members, as described in Section 6011, pursuant to the election
and appointment processes specified in Sections 6012, 6013.1,
6013.2, and 6013.3.

(2) The State Bar shall develop a plan for implementing the
transition to a 19-member board by January 31, 2012.

(3) By January 31, 2012, the State Bar shall submit a written
report to the Senate and Assembly Committees on Judiciary that
includes, but is not limited to, the implementation plan described
in paragraph (2).

(b) The State Bar shall complete the transition to a 19-member
board no later than October 31, 2014.

(c) The State Bar shall not change, reduce, shorten, lengthen,
or abolish the terms of board members commencing prior to
December 31, 2011, or force any board member to resign in order
to institute a 19-member board pursuant to this section.

(d) The State Bar shall report annually to the Senate and
Assembly Committees on Judiciary on its progress toward
implementing the transition to a 19-member board.

end delete

begin insert

begin insert SEC. 6. end insert   

end insert

begin insert Section 6011 of the end insert begin insert Business and Professions Code end insert begin insert is
amended to read: end insert

6011.  

(a) The board shall consist of no more than begin delete 23 end delete begin insert 19 end insert
members and no begin delete less end delete begin insert fewer end insert than begin delete 19 end delete begin insert 13 end insert members.

(b) It is the intent of the Legislature that the board consist of no
more than begin delete 23 end delete begin insert 19 end insert members and no begin delete less end delete begin insert fewer end insert than begin delete 19 end delete begin insert 13 end insert members
during the period of transition from a begin delete 23-member end delete begin insert 19-member end insert board
to a begin delete 19-member board, as described in Section 6009.7. end delete begin insert 13-member
board. end insert It is the intent of the Legislature that the begin delete board, pursuant
to the plan developed by the State Bar as described in Section
6009.7, gradually end delete begin insert board end insert decrease its size without shortening,
lengthening, or abolishing terms commencing prior to December
31, begin delete 2011, end delete begin insert 2016, end insert with the ultimate goal of instituting a begin delete 19-member end delete
begin insert 13-member end insert board no later than October 31, begin delete 2014, pursuant to
Section 6009.7. end delete begin insert 2019. It is the intent of the Legislature that this
transition occur by the expiration of the terms of the elected
members who are serving on the board as of December 31, 2016. end insert

begin insert

(c) When making appointments to the board after December
31, 2016, each appointing authority shall consider appointing
members with demonstrated education or experience, or both, in
at least one of the following:

end insert begin insert

(1) Public finance.

end insert begin insert

(2) Public administration.

end insert begin insert

(3) Business or financial management.

end insert begin insert

(4) State government, particularly prior regulatory experience.

end insert begin insert

(5) Legal ethics.

end insert begin insert

(6) Immigration law.

end insert

begin insert

begin insert SEC. 7. end insert   

end insert

begin insert Section 6012 of the end insert begin insert Business and Professions Code end insert begin insert is
repealed. end insert

begin delete

6012.  

(a) State Bar Districts, as they existed on December 31,
2011, pursuant to Section 6012.5, as added by Chapter 1223 of
the Statutes of 1989, shall cease, pursuant to the act that added this
section, for purposes of the election of attorney members of the
board. However, attorney members who were elected in 2009,
2010, or 2011 to serve for a three-year term commencing at the
conclusion of the annual meeting held in those years shall be
eligible to serve their full three-year terms.

(b) Commencing on January 1, 2012, State Bar Districts shall
be based on the six court of appeal districts as constituted pursuant
to Section 69100 of the Government Code, as they existed on
December 31, 2011. The board shall provide for the election of
six attorney members of the board from these six State Bar Districts
as specified in Section 6013.2.

end delete

begin insert

begin insert SEC. 8. end insert   

end insert

begin insert Section 6013.1 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6013.1.  

(a) The Supreme Court shall appoint five attorney
members of the board pursuant to a process that the Supreme Court
may prescribe. These attorney members shall serve for a term of
begin delete three end delete begin insert four end insert years and may be reappointed by the Supreme Court for
one additional term only.

(b) An attorney member elected pursuant to Section 6013.2 may
be appointed by the Supreme Court pursuant to this section to a
term as an appointed attorney member.

(c) The Supreme Court shall fill any vacancy in the term of, and
make any reappointment of, any appointed attorney member.

(d) When making appointments to the board, the Supreme Court
should consider appointing attorneys that represent the following
categories: legal services; small firm or solo practitioners;
historically underrepresented groups, including consideration of
race, ethnicity, gender, and sexual orientation; and legal academics.
In making appointments to the board, the Supreme Court should
also consider geographic distribution, years of practice, particularly
attorneys who are within the first five years of practice or 36 years
of age and under, and participation in voluntary local or state bar
activities.

(e) The State Bar shall be responsible for carrying out the
administrative responsibilities related to the appointment process
described in subdivision (a).

begin insert

begin insert SEC. 9. end insert   

end insert

begin insert Section 6013.2 of the end insert begin insert Business and Professions Code end insert

begin insert is repealed. end insert

begin delete

6013.2.  

(a) Six members of the board shall be attorneys elected
from the State Bar Districts created by the board pursuant to
Section 6012.

(b) An attorney member elected pursuant to this section shall
serve for a term of three years. An elected attorney member may
run for reelection, but may be reelected to only serve one additional
term.

end delete

begin insert

begin insert SEC. 10. end insert   

end insert

begin insert Section 6013.3 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6013.3.  

(a) One attorney member of the board shall be
appointed by the Senate Committee on Rules and one attorney
member shall be appointed by the Speaker of the Assembly.

(b) An attorney member appointed pursuant to this section shall
serve for a term of begin delete three end delete begin insert four end insert years. An appointed attorney member
may be reappointed pursuant to this section.

begin insert

begin insert SEC. 11. end insert   

end insert

begin insert Section 6013.5 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6013.5.  

begin delete Notwithstanding any other provision of law, end delete
begin insert (a) end insert begin insert   end insert begin insert Effective January 1, 2017, a minimum of end insert six members of the
board shall be members of the public who have never been
members of the State Bar or admitted to practice before any court
in the United States. begin delete They shall be appointed through 1982 by the
Governor, subject to the confirmation of the Senate. end delete

begin delete

Each

end delete

begin insert (b) end insert begin insert   end insert begin insert Each end insert of begin delete such end delete begin insert these end insert members shall serve for a term of begin delete three end delete
begin insert four end insert years, commencing at the conclusion of the annual meeting
next succeeding his begin delete appointment, except that for the initial term
after enactment of this section, two shall serve for one year, two
for two years, and the other two for three years, as determined by
lot. end delete begin insert or her appointment. end insert

begin delete

In 1983 one

end delete

begin insert (c) end insert begin insert   end insert begin insert One end insert public member shall be appointed by the Senate
Committee on Rules and one public member shall be appointed
by the Speaker of the Assembly.

begin delete

For each of the years, 1984 and 1985, two

end delete

begin insert (d) end insert begin insert   end insert begin insert Four end insert public members shall be appointed by the Governor,
subject to the confirmation of the Senate.

begin delete

Each

end delete

begin insert (e) end insert begin insert   end insert begin insert Each end insert respective appointing authority shall fill any vacancy
in and make any reappointment to each respective office.

begin insert

begin insert SEC. 12. end insert   

end insert

begin insert Section 6015 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6015.  

No person is eligible for attorney membership on the
board unless begin delete both end delete begin insert all end insert of the following conditions are satisfied:

(a) He or she is an active member of the State Bar.

(b) Either:

(1)  begin delete If end delete begin insert Prior to October 31, 2019, if end insert elected, he or she maintains
his or her principal office for the practice of law within the State
Bar district from which he or she is elected.

(2) If appointed by the Supreme Court or the Legislature, he or
she maintains his or her principal office for the practice of law
within the State of California.

begin insert

(c) If newly appointed after December 31, 2016, he or she
satisfies the requirements of subdivision (c) of Section 6011.

end insert

begin insert

begin insert SEC. 13. end insert   

end insert

begin insert Section 6016 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6016.  

The term of office of each attorney member of the board
shall commence at the conclusion of the annual meeting next
succeeding his or her election or appointment, and he or she shall
hold office until his or her successor is elected or appointed and
qualified. For the purposes of this section, the time intervening
between any two successive annual meetings shall be deemed to
be one year.

begin delete

Except as specified in Section 6013.1, vacancies in the board of
trustees shall be filled by the board by special election or by
appointment for the unexpired term.

end delete

The board of trustees may provide by rule for an interim board
to act in the place and stead of the board when because of vacancies
during terms of office there is less than a quorum of the board.

begin insert

begin insert SEC. 14. end insert   

end insert

begin insert Section 6018 of the end insert begin insert Business and Professions Code end insert

begin insert is repealed. end insert

begin delete

6018.  

Nominations of elected members of the board shall be
by petition signed by at least 20 persons entitled to vote for such
nominees.

Only active members of the State Bar maintaining their principal
offices for the practice of the law in the respective State Bar
districts shall be entitled to vote for the member or members of
the board therefrom.

end delete

begin insert

begin insert SEC. 15. end insert   

end insert

begin insert Section 6019 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6019.  

Each place upon the board for which a member is to be
begin delete elected or end delete appointed shall for the purposes of the begin delete election or end delete
appointment be deemed a separate office.

begin delete

In all other respects the elections shall be as the board may by
rule direct.

end delete begin delete

If only one member seeks election to an office, the member is
deemed elected. If two or more members seek election to the same
office, the election shall be by ballot. The ballots shall be
distributed to those entitled to vote at least twenty days prior to
the date of canvassing the ballots and shall be returned to a site or
sites designated by the State Bar, where they shall be canvassed
at least five days prior to the ensuing annual meeting. At the annual
meeting, the count shall be certified and the result officially
declared.

end delete

begin insert

begin insert SEC. 16. end insert   

end insert

begin insert Section 6021 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6021.  

(a) (1)  begin delete Within the period of 90 days next preceding the
annual meeting, the board, at a meeting called for that purpose, end delete
begin insert The California Supreme Court end insert shall begin delete elect end delete begin insert select from end insert the begin delete president,
vice president, and treasurer for end delete begin insert members of end insert the begin delete ensuing year. The
president, the vice president, end delete begin insert board a chair end insert and begin delete the treasurer shall
be elected from among all members end delete begin insert a vice chair to serve in the
absence end insert of the begin delete board. end delete begin insert chair. end insert

(2) The begin delete newly elected president, end delete begin insert chair and end insert vice begin delete president, and
treasurer end delete begin insert chair end insert shall assume the duties of their respective offices
at the conclusion of the annual meeting following their begin delete election. end delete

begin insert appointment. end insert

(b) The term of the board begin delete president end delete begin insert chair end insert shall be begin delete one year,
except that he or she may be reelected to a second one-year term
as the board president. end delete begin insert two years. end insert

begin delete end delete begin delete

(c) Notwithstanding the provisions of Sections 6009.7 and 6011
regarding a 19-member board, if the president is elected from
among those members of the board whose terms on the board
expire that year and has not been reelected or reappointed to
another term under Section 6013.1, 6013.2, 6013.3, or 6013.5, the
president shall serve as a 20th member of the board during his or
her one-year term, and he or she may vote.

end delete begin delete end delete

begin insert

begin insert SEC. 17. end insert   

end insert

begin insert Section 6022 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6022.  

The secretary begin insert and treasurer of the State Bar end insert shall be
selected annually by the board and need not be begin delete a member end delete begin insert members end insert
of the State Bar.

begin insert

begin insert SEC. 18. end insert   

end insert

begin insert Section 6026.5 of the end insert begin insert Business and Professions Code end insert begin insert ,
as added by Section 3 of Chapter 537 of the Statutes of 2015, is
repealed. end insert

begin delete

6026.5.  

(a) Pursuant to Section 6026.7, every meeting of the
board shall be open to the public except those meetings, or portions
thereof, relating to:

(1) Consultation with counsel concerning pending or prospective
litigation.

(2) Involuntary enrollment of active members as inactive
members due to mental infirmity or illness or addiction to
intoxicants or drugs.

(3) The qualifications of judicial appointees, nominees, or
candidates.

(4) The appointment, employment, or dismissal of an employee,
consultant, or officer of the State Bar or to hear complaints or
charges brought against such employee, consultant, or officer,
unless such person requests a public hearing.

(5) Disciplinary investigations and proceedings, including
resignations with disciplinary investigations or proceedings
pending, and reinstatement proceedings.

(6) Appeals to the board from decisions of the Board of Legal
Specialization refusing to certify or recertify an applicant or
suspending or revoking a specialist’s certificate.

(7) Appointments to or removals from committees, boards, or
other entities.

(8) Joint meetings with agencies provided in Article VI of the
California Constitution.

(b) This section shall become operative on April 1, 2016.

end delete

begin insert

begin insert SEC. 19. end insert   

end insert

begin insert Section 6026.7 of the end insert begin insert Business and Professions Code end insert begin insert ,
as added by Section 5 of Chapter 537 of the Statutes of 2015, is
amended to read: end insert

6026.7.  

(a) The State Bar is subject to the Bagley-Keene Open
Meeting Act (Article 9 (commencing with Section 11120) of
Chapter 1 of Part 1 of Division 3 of Title 2 of the Government
Code) and all meetings of the State Bar are subject to the
Bagley-Keene Open Meeting Act.

(b) Notwithstanding any other law, the Bagley-Keene Open
Meeting Act shall not apply to the begin insert Commission on end insert Judicial
Nominees begin delete Evaluation Commission or end delete begin insert Evaluation, end insert the Committee
of Bar begin delete Examiners. end delete begin insert Examiners, or the State Bar Court. end insert

(c)  begin delete This section shall become operative on April 1, 2016. end delete begin insert In
addition to the grounds authorized in the Bagley-Keene Open
Meeting Act, a closed session may be held for those meetings, or
portions thereof, relating to both of the following: end insert

begin insert

(1) Appeals from decisions of the Board of Legal Specialization
refusing to certify or recertify an applicant or suspending or
revoking a specialist’s certificate.

end insert begin insert

(2) The preparation, approval, grading, or administration of
examinations for certification of a specialist.

end insert

begin insert

begin insert SEC. 20. end insert   

end insert

begin insert Section 6029 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6029.  

begin insert (a) end insert begin insert   end insert The board may appoint such committees, begin delete officers end delete
begin insert officers, end insert and employees as it deems necessary or begin delete proper, end delete begin insert proper end insert
and fix and pay salaries and necessary expenses.

begin insert

(b) Any executive committee of the board shall include at least
one member of the board who was previously appointed by each
of the following appointing authorities:

end insert begin insert

(1) The California Supreme Court.

end insert begin insert

(2) The Governor.

end insert begin insert

(3) The Senate Committee on Rules.

end insert begin insert

(4) The Speaker of the Assembly.

end insert

begin insert

begin insert SEC. 21. end insert   

end insert

begin insert Section 6030 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6030.  

The board shall be charged with the executive function
of the State Bar and the enforcement of the provisions of this
chapter. The violation or threatened violation of any provision of
Articles 7 (commencing with Section 6125) and 9 (commencing
with Section 6150) of this chapter may be enjoined in a civil action
brought in the superior court by the State Bar and no undertaking
shall be required of the State Bar.

begin insert

(a) Any decision of the board that the California Supreme Court
determines may raise antitrust concerns shall be reviewed by the
California Supreme Court and is subject to modification, veto, or
other appropriate action by the California Supreme Court.

end insert

begin insert

begin insert SEC. 22. end insert   

end insert

begin insert Section 6060.2 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6060.2.  

begin insert (a) end insert begin insert   end insert All investigations or proceedings conducted by
the State Bar concerning the moral character of an applicant shall
be confidential and shall not be disclosed pursuant to any state
law, including, but not limited to, the California Public Records
Act (Chapter 3.5 (commencing with Section 6250) of Division 7
of Title 1 of the Government Code) unless the applicant, in writing,
waives the confidentiality. begin delete However, the records of the proceeding
may be subject to lawfully issued subpoenas. end delete

begin insert

(b) Notwithstanding subdivision (a), the records of the
proceeding may be disclosed in response to either of the following:

end insert begin insert

(1) A lawfully issued subpoena.

end insert begin insert

(2) A written request from a government agency responsible
for either the enforcement of civil or criminal laws or the
professional licensing of individuals that is conducting an
investigation about the applicant.

end insert

begin insert

begin insert SEC. 23. end insert   

end insert

begin insert Section 6060.25 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6060.25.  

begin insert (a) end insert begin insert   end insert Notwithstanding any other law, any identifying
information submitted by an applicant to the State Bar for
admission and a license to practice law and all State Bar admission
records, including, but not limited to, bar examination scores, law
school grade point average (GPA), undergraduate GPA, Law
School Admission Test scores, race or ethnicity, and any
information contained within the State Bar Admissions database
or any file or other data created by the State Bar with information
submitted by the applicant that may identify an individual
applicant, begin insert other than information described in subdivision (b), end insert
shall be confidential and shall not be disclosed pursuant to any
state law, including, but not limited to, the California Public
Records Act (Chapter 3.5 (commencing with Section 6250) of
Division 7 of Title 1 of the Government Code).

begin insert

(b) This section does not prohibit the disclosure of any of the
following:

end insert begin insert

(1) The names of applicants who have passed any examination
administered, given, or prescribed by the Committee of Bar
Examiners.

end insert begin insert

(2) Information that is provided at the request of an applicant
to another jurisdiction where the applicant is seeking admission
to the practice of law.

end insert begin insert

(3) Information provided to a law school that is necessary for
the purpose of the law school’s compliance with accreditation or
regulatory requirements.

end insert begin insert

(4) Information provided to the National Conference of Bar
Examiners or a successor nonprofit organization in connection to
the State Bar’s administration of any examination.

end insert begin insert

(5) This subdivision shall apply retroactively to January 1, 2016.

end insert begin insert

(c) Disclosure of any of the information in paragraphs (2) to
(4), inclusive, of subdivision (b) shall not constitute a waiver under
Section 6254.5 of the Government Code of the exemption from
disclosure provided for in subdivision (a) of this section.

end insert

begin insert

begin insert SEC. 24. end insert   

end insert

begin insert Section 6075.6 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 6075.6. end insert   

(a) (1) The Attorney General shall appoint a State
Bar enforcement program monitor prior to March 31, 2017. The
applicant for the position shall have investigative experience, shall
be familiar with California laws and procedures, and, preferably,
shall be familiar with the rules and procedures of the State Bar
lawyer discipline system and relevant administrative procedures.
The enforcement program monitor may be a state employee or his
or her services may be provided pursuant to contract.

(2) The Attorney General shall supervise the enforcement
program monitor and may terminate or dismiss him or her from
this position.

(b) (1) The enforcement program monitor shall monitor and
evaluate the disciplinary system and procedures of the State Bar.
The enforcement program monitor shall make his or her highest
priority the reform and reengineering of the State Bar’s
enforcement program and operations and the improvement of the
overall efficiency of the State Bar’s disciplinary system so that the
State Bar is successfully and consistently protecting the public.

(2) This monitoring duty shall include, but not be limited to,
review of State Bar reports, recommendations for a prioritization
standard for cases most likely to cause potential harm to the public,
improving the timeframe for the handling of complaints and in the
rendering of initial decisions on complaints, developing a
recommendation for an appropriate definition of “complex case”
and a reasonable timeframe for rendering an initial decision in
these cases, reviewing the efficiency of the system, the fairness
and courtesy given to complainants, and the adequacy of the
staffing and the budget allocated to the discipline section of the
State Bar, reducing the complaint backlog, recommendations
regarding an appropriate backlog standard in light of the
prioritization standards recommended by the enforcement program
monitor, reviewing the consistency in the application of sanctions
or discipline imposed, the implementation of laws affecting
discipline and the State Bar’s operations, and reviewing
disciplinary standards and rules, staff concerns regarding
disciplinary matters or procedures, and the State Bar’s cooperation
with other governmental entities charged with enforcing related
laws and regulations that affect members of the State Bar.

(3) The enforcement program monitor shall exercise no authority
over the State Bar’s discipline operations or staff; however, the
State Bar and its staff shall cooperate with the enforcement
program monitor, and the State Bar shall provide data,
information, and case files as requested by the enforcement
program monitor to perform all of his or her duties.

(c) The enforcement program monitor shall submit an initial
written report of his or her findings and conclusions to the State
Bar, the Supreme Court, and the Legislature no later than October
1, 2019, and be available to make oral reports to each if requested
to do so. The initial report shall include an analysis of the sources
of information that resulted in each disciplinary action imposed
since January 1, 2016. The enforcement program monitor may
also provide additional information to either the Supreme Court,
the State Bar, or the Legislature at his or her discretion or at the
request of the Supreme Court, the State Bar, or the Legislature.
The enforcement program monitor shall make his or her reports
available to the public or the media. The enforcement program
monitor shall make every effort to provide the State Bar with an
opportunity to reply to any facts, findings, issues, or conclusions
in his or her reports with which the State Bar may disagree.

(d) The enforcement program monitor shall issue a final report
prior to March 31, 2020.

(e) This section shall become inoperative on March 31, 2020,
and as of January 1, 2021, shall be repealed.

end insert

begin insert

begin insert SEC. 25. end insert   

end insert

begin insert Section 6086.5 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6086.5.  

The board of trustees shall establish a State Bar Court,
to act in its place and stead in the determination of disciplinary
and reinstatement proceedings and proceedings pursuant to
subdivisions (b) and (c) of Section 6007 to the extent provided by
rules adopted by the board of trustees pursuant to this chapter. In
these proceedings the State Bar Court may exercise the powers
and authority vested in the board of trustees by this chapter,
including those powers and that authority vested in committees
of, or established by, the board, except as limited by rules of the
board of trustees within the scope of this chapter.

begin insert

Access to records of the State Bar Court shall be governed by
court rules and laws applicable to records of the judiciary and
not the California Public Records Act (Chapter 3.5 (commencing
with Section 6250) of Division 7 of Title 1 of the Government
Code).

end insert

For the purposes of Sections 6007, 6043, 6049, 6049.2, 6050,
6051, 6052, 6077 (excluding the first sentence), 6078, 6080, 6081,
and 6082, “board” includes the State Bar Court.

Nothing in this section shall authorize the State Bar Court to
adopt rules of professional conduct or rules of procedure.

The Executive Committee of the State Bar Court may adopt
rules of practice for the conduct of all proceedings within its
jurisdiction. These rules may not conflict with the rules of
procedure adopted by the board, unless approved by the Supreme
Court.

begin insert

begin insert SEC. 26. end insert   

end insert

begin insert Section 6134 is added to the end insert begin insert Business and Professions
Code end insert begin insert , to read: end insert

begin insert

begin insert 6134. end insert   

(a) When the Office of the Chief Trial Counsel becomes
aware of an allegation that a person not licensed to practice law
in California has practiced or held himself or herself out as
practicing law or entitled to practice law in the state, the office’s
intake unit shall open a nonattorney complaint against that person
for evaluation and processing.

(b) The intake unit shall open a case record in the office’s case
management system with the complaint form received date. The
complaint form received date shall be the date the State Bar first
received the complaint. Evaluation and processing of the
nonattorney complaint shall include, but not be limited to, all of
the following:

(1) Creation of a summary of the allegation or allegations in
the case record and assignment to staff, including inputting staff
assignment codes into the case management system.

(2) Identifying the source of the complaint.

(3) Identifying the relevant practice area of law, such as
immigration, loan modification, or debt resolution, and recording
the relevant practice area of law in the case record.

(4) Identifying whether the allegations include potential identity
theft of a licensed attorney’s identity and, if so, contacting the
potential victim attorney to verify whether the attorney is aware
of the potential identify theft and whether he or she has notified
law enforcement.

(5) Evaluating the nonattorney complaint for unauthorized
practice of law allegations, which includes opening a
corresponding attorney complaint case record, if appropriate,
such as in the case in which the nonattorney complaint also
identifies a licensed California attorney potentially aiding or
abetting the person in the unauthorized practice of law.

(6) Seeking additional information from the complainant or
other sources, such as the Internet, when the nonattorney complaint
does not provide specific or sufficient facts to establish that the
unauthorized practice of law may have occurred.

(7) Determining whether to forward the complaint to the
enforcement unit for investigation.

(c) If the nonattorney complaint sufficiently alleges an
unauthorized practice of law violation, the intake unit shall do
both of the following:

(1) Forward the nonattorney complaint to the enforcement unit
for further action.

(2) Refer the matter to law enforcement or other appropriate
agency for consideration of criminal or other enforcement action,
as specified in subdivisions (f) and (g).

(d) If the nonattorney complaint sufficiently alleges the use of
“notario,” “notario publico,” or other words or phrases in
violation of Section 6126.7 or there is other evidence of a violation
of Section 6126.7, the intake unit shall forward the complaint to
the enforcement unit for further action.

(e) If the nonattorney complaint does not sufficiently allege an
unauthorized practice of law violation or a violation of Section
6126.7, the intake unit shall do all of the following:

(1) Notify the complainant in writing of the determination.

(2) Advise the complainant in writing of the opportunity to seek
reconsideration of the determination.

(3) Process the case for closure, including updating the case
record.

(f) The intake unit’s staff shall resolve nonattorney complaints
by either:

(1) Forwarding the nonattorney complaint to the office’s
enforcement unit.

(2) Closing the nonattorney complaint in the intake unit.

(g) (1) A nonattorney complaint alleging the unauthorized
practice of law shall be presumed to warrant a law enforcement
referral to federal, state, or local authorities, such as the United
States Attorney, the Attorney General, the local district attorney,
local county counsel, or local city attorney, for criminal or other
enforcement action.

(2) After the intake unit forwards a nonattorney complaint, the
office’s enforcement unit shall make the referral required under
paragraph (1), where appropriate, and shall coordinate with law
enforcement, as appropriate, throughout the office’s investigation
of the nonattorney complaint.

(3) The intake unit may, where warranted, refer nonattorney
complaints that do not allege the unauthorized practice of law to
another regulatory agency, such as the Bureau of Real Estate, the
Department of Consumer Affairs, the United States Securities and
Exchange Commission, the Federal Trade Commission, and the
United States Patent and Trademark Office.

(h) Staff of the intake unit shall evaluate nonattorney complaints
and strive to meet all of the following in at least 90 percent of
nonattorney complaints filed:

(1) Open a nonattorney complaint case record within five days
from the complaint form received date, as defined in subdivision
(b).

(2) Complete the initial legal review of the nonattorney
complaint within 20 days from the complaint form received date.

(3) Process the nonattorney complaint to resolution, which
means closing the case or forwarding the case for investigation,
within 60 days from the complaint form received date.

(i) Staff of the intake unit shall maintain processing activities
in the nonattorney complaint case record, including the recording
and tracking of other regulatory agency referrals made in
connection with a nonattorney complaint.

(j) All nonattorney complaints forwarded by the intake unit to
the office’s enforcement unit shall be investigated to determine
whether there is evidence of the unauthorized practice of law or
any violation of Section 6126.7. There shall be an appropriate law
enforcement referral upon assignment to a staff member of the
enforcement unit. Assigned enforcement unit staff shall update any
law enforcement agency to which the complaint was referred with
the status and findings of the investigation as it proceeds. Upon
completion of an investigation, the assigned staff of the enforcement
unit shall analyze the evidence to determine whether the evidence
is sufficient to support formal proceedings in superior court.

(k) Enforcement unit staff shall complete nonattorney complaint
investigations to resolution by one of the following:

(1) Filing enforcement proceedings in superior court.

(2) Issuing a cease and desist letter. Enforcement unit staff may
issue a cease and desist letter where the unauthorized practice of
law activity appears isolated in nature and unlikely to recur or
where it otherwise appears that a cease and desist warning will
sufficiently address and stop the activity at issue.

(3) Closing the complaint with no further action.

(l) Enforcement unit staff shall investigate nonattorney
complaints adhering to the same backlog time standard applicable
to attorney discipline complaints and shall resolve the complaint
within six months from the complaint form received date.

(m) Intake unit staff and enforcement unit staff shall, as
appropriate, maintain and update processing activities in the
nonattorney case record, as follows:

(1) Record and track the number of superior court proceedings
initiated pursuant to Section 6126.3.

(2) Record and track the number of superior court proceedings
initiated pursuant to Section 6126.4.

(3) Record and track the number of superior court proceedings
initiated pursuant to Section 6126.7.

(4) Record and track the number of superior court proceedings
initiated pursuant to Section 6127.

(5) Record and track the number of law enforcement referrals
made in connection with nonattorney complaints.

(6) Record and track the number of other agency referrals made
in connection with nonattorney complaints.

(7) Record and track the number of cease and desist letters
issued in connection with nonattorney complaints.

end insert

begin insert

begin insert SEC. 27. end insert   

end insert

begin insert Section 6140 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6140.  

(a) The board shall fix the annual membership fee for
active members for begin delete 2016 end delete begin insert 2017 end insert at a sum not exceeding three
hundred fifteen dollars ($315).

(b) The annual membership fee for active members is payable
on or before the first day of February of each year. If the board
finds it appropriate and feasible, it may provide by rule for payment
of fees on an installment basis with interest, by credit card, or other
means, and may charge members choosing any alternative method
of payment an additional fee to defray costs incurred by that
election.

(c) This section shall remain in effect only until January 1, begin delete 2017, end delete
begin insert 2018, end insert and, as of that date, is repealed, unless a later enacted statute,
that is enacted before January 1, begin delete 2017, end delete begin insert 2018, end insert deletes or extends
that date.

begin insert

begin insert SEC. 28. end insert   

end insert

begin insert Section 6140.56 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 6140.56. end insert   

(a) To ensure that the Client Security Fund can
adequately protect the public and relieve or mitigate financial
losses caused by the dishonest conduct of members of the State
Bar by paying claims in a timely manner, the State Bar shall
conduct a thorough analysis of the Client Security Fund, including
a review of the State Bar’s oversight of the Client Security Fund,
to ensure that the structure provides for the most effective and
efficient operation of the fund, a determination of the ongoing
needs of the fund to satisfy claims in a timely manner, a review of
additional efforts that can be taken to increase the collection of
payments from the responsible attorneys, and a review of other
State Bar expenditures to determine whether other expenditures
that do not directly impact the State Bar’s public protection
functions, including, but not limited to, executive salaries and
benefits, can be reduced or redirected in order to better fund the
Client Security Fund through existing revenue, and, whether, after
all other options have been fully and thoroughly exhausted, an
increase in membership dues is necessary to ensure that the Client
Security Fund can timely pay claims.

(b) The State Bar shall submit a report on its analysis of the
Client Security Fund to the Legislature by March 15, 2017, so that
the plans can be reviewed in conjunction with the bill that would
authorize the imposition of the State Bar’s membership fee. The
report shall be submitted in compliance with Section 9795 of the
Government Code.

(c) For purposes of this section, “timely manner” means within
12 months from either the time the claim is received by the State
Bar or the resolution of the underlying discipline case involving
an attorney member that is a prerequisite to paying the claim,
whichever is later.

end insert

begin insert

begin insert SEC. 29. end insert   

end insert

begin insert Section 6145 of the end insert begin insert Business and Professions Code end insert

begin insert is amended to read: end insert

6145.  

(a) The board shall engage the services of an independent
national or regional public accounting firm with at least five years
of experience in governmental auditing for an audit of its begin insert revenues,
expenditures, reserves, and its end insert financial statement for each fiscal
year. The financial statement shall be promptly certified under
oath by the Treasurer of the State Bar, and a copy of the audit and
financial statement shall be submitted within 120 days of the close
of the fiscal year to the board, to the Chief Justice of begin delete the Supreme
Court, end delete begin insert California, end insert and to the Assembly and Senate Committees
on Judiciary.

The audit shall examine the receipts and expenditures of the
State Bar and the State Bar sections to ensure that the receipts of
the sections are being applied, and their expenditures are being
made, in compliance with subdivision (a) of Section 6031.5, and
that the receipts of the sections are applied only to the work of the
sections.

The audit also shall examine the receipts and expenditures of
the State Bar to ensure that the funds collected on behalf of the
Conference of Delegates of California Bar Associations as the
independent successor entity to the former Conference of Delegates
of the State Bar are conveyed to that entity, that the State Bar has
been paid or reimbursed for the full cost of any administrative and
support services provided to the successor entity, including the
collection of fees or donations on its behalf, and that no mandatory
dues are being used to fund the activities of the successor entity.

In selecting the accounting firm, the board shall consider the
value of begin delete continuity, along with end delete begin insert continuity and end insert the risk that
continued long-term engagements of an accounting firm may affect
the independence of that firm.

(b) The board shall contract with the California State Auditor’s
Office to conduct a performance audit of the State Bar’s operations
from July 1, 2000, to December 31, 2000, inclusive. A copy of the
performance audit shall be submitted by May 1, 2001, to the board,
to the Chief Justice of begin delete the Supreme Court, end delete begin insert California, end insert and to the
Assembly and Senate Committees on Judiciary.

Every two years thereafter, the board shall contract with the
California State Auditor’s Office to conduct a performance audit
of the State Bar’s operations for the respective fiscal year,
commencing with January 1, 2002, to December 31, 2002,
inclusive. A copy of the performance audit shall be submitted
within 120 days of the close of the fiscal year for which the audit
was performed to the board, to the Chief Justice of begin delete the Supreme
Court, end delete begin insert California, end insert and to the Assembly and Senate Committees
on Judiciary.

begin insert

For the performance audit due to the board, to the Chief Justice
of California, and to the Assembly and Senate Committees on
Judiciary in 2017, the California State Auditor shall review all of
the State Bar’s expenses, including, but not limited to, executive
salaries and benefits, outside contracts, and real estate holdings,
to determine the expenses that are appropriate and necessary to
protect the public and what the appropriate level of member dues
should be and shall review and assess the State Bar’s methodology
for determining and assessing member dues. That audit shall also
include a recommendation by the California State Auditor of an
appropriate methodology for the State Bar to calculate the portion
of administrative costs that are appropriately allocated to the
sections of the State Bar, including a fair and transparent process
for giving the sections advance notice of their costs and allowing
the sections to challenge the amount of administrative costs
allocated to them.

end insert

For the purposes of this subdivision, the California State
Auditor’s Office may contract with a third party to conduct the
performance audit. This subdivision is not intended to reduce the
number of audits the California State Auditor’s Office may
otherwise be able to conduct.

begin insert

(c) (1) In addition to the audits required in subdivision (b), the
California State Auditor shall conduct a performance audit
evaluating the State Bar’s progress in all of the following:

end insert begin insert

(A) Reviewing any changes in the State Bar’s expenses made
as a result of prior audits by the California State Auditor.

end insert begin insert

(B) Correcting any issues raised in prior California State
Auditor audits.

end insert begin insert

(C) Increasing operational effectiveness and efficiency.

end insert begin delete

(c) Effective January 1, 2016, the board shall contract with the
California State Auditor’s Office to conduct an in-depth financial
audit of the State Bar, including an audit of its financial statement,
internal controls, and relevant management practices.

end delete

begin insert (2) end insert begin insert   end insert The begin delete contract shall include reimbursement for the end delete California
State begin delete Auditor’s Office for the costs of conducting the audit. The
audit shall, at a minimum, examine the revenues, expenditures,
and reserves of the State Bar, including all fund transfers. The
California State Auditor’s Office end delete begin insert Auditor end insert shall begin delete commence the audit
no later than January 1, 2016, end delete begin insert report his or her findings end insert and begin delete a copy
of the audit shall be submitted by May 15, 2016, end delete begin insert recommendations end insert
to the board, begin insert to end insert the Chief Justice of begin delete the Supreme Court, end delete begin insert California, end insert
and to the Assembly and Senate Committees on begin delete Judiciary. The
audit shall be submitted in compliance with Section 9795 of the
Government Code. This subdivision shall cease to be operative
January 1, 2017. end delete begin insert Judiciary no later than June 15, 2018. end insert

begin insert

begin insert SEC. 30. end insert   

end insert begin insert

The Legislature finds and declares that Sections 19
and 25 of this act, which amend Sections 6026.7 and 6086.5 of the
Business and Professions Code, impose a limitation on the public’s
right of access to the meetings of public bodies or the writings of
public officials and agencies within the meaning of Section 3 of
Article I of the California Constitution. Pursuant to that
constitutional provision, the Legislature makes the following
findings to demonstrate the interest protected by this limitation
and the need for protecting that interest:

end insert begin insert

In order to protect the decisionmaking process of the State Bar
Court in a manner that is similar to the deliberative functions of
other courts and in order to ensure that personal or sensitive
information regarding discipline by the State Bar Court is kept
confidential, including for persons participating in discussions
and offers of settlement pursuant to arbitration or mediation, it is
necessary to exempt the State Bar Court from the provision of the
Bagley-Keene Open Meeting Act and the California Public Records
Act.

end insert

begin delete

SECTION 1.  

Section 5830 of the Welfare and Institutions Code
is amended to read:

5830.  

County mental health programs shall develop plans for
innovative programs to be funded pursuant to paragraph (6) of
subdivision (a) of Section 5892.

(a) The innovative programs shall have the following purposes:

(1) To increase access to underserved groups.

(2) To increase the quality of services, including better
outcomes.

(3) To promote interagency collaboration.

(4) To increase access to services, including, but not limited to,
services provided through permanent supportive housing.

(b) All projects included in the innovative program portion of
the county plan shall meet the following requirements:

(1) Address one of the following purposes as its primary
purpose:

(A) Increase access to underserved groups, which may include
providing access through the provision of permanent supportive
housing.

(B) Increase the quality of services, including measurable
outcomes.

(C) Promote interagency and community collaboration.

(D) Increase access to services, which may include providing
access through the provision of permanent supportive housing.

(2) Support innovative approaches by doing one of the
following:

(A) Introducing new mental health practices or approaches,
including, but not limited to, prevention and early intervention.

(B) Making a change to an existing mental health practice or
approach, including, but not limited to, adaptation for a new setting
or community.

(C) Introducing a new application to the mental health system
of a promising community-driven practice or an approach that has
been successful in nonmental health contexts or settings.

(D) Participating in a housing program designed to stabilize a
person’s living situation while also providing supportive services
on site.

(c) An innovative project may affect virtually any aspect of
mental health practices or assess a new or changed application of
a promising approach to solving persistent, seemingly intractable
mental health challenges, including, but not limited to, any of the
following:

(1) Administrative, governance, and organizational practices,
processes, or procedures.

(2) Advocacy.

(3) Education and training for service providers, including
nontraditional mental health practitioners.

(4) Outreach, capacity building, and community development.

(5) System development.

(6) Public education efforts.

(7) Research.

(8) Services and interventions, including prevention, early
intervention, and treatment.

(9) Permanent supportive housing development.

(d) If an innovative project has proven to be successful and a
county chooses to continue it, the project workplan shall transition
to another category of funding as appropriate.

(e) County mental health programs shall expend funds for their
innovation programs upon approval by the Mental Health Services
Oversight and Accountability Commission.

SEC. 2.  

Section 5847 of the Welfare and Institutions Code is
amended to read:

5847.  

Integrated Plans for Prevention, Innovation, and System
of Care Services.

(a) Each county mental health program shall prepare and submit
a three-year program and expenditure plan, and annual updates,
adopted by the county board of supervisors, to the Mental Health
Services Oversight and Accountability Commission within 30 days
after adoption.

(b) The three-year program and expenditure plan shall be based
on available unspent funds and estimated revenue allocations
provided by the state and in accordance with established
stakeholder engagement and planning requirements as required in
Section 5848. The three-year program and expenditure plan and
annual updates shall include all of the following:

(1) A program for prevention and early intervention in
accordance with Part 3.6 (commencing with Section 5840).

(2) A program for services to children in accordance with Part
4 (commencing with Section 5850), to include a program pursuant
to Chapter 4 (commencing with Section 18250) of Part 6 of
Division 9 or provide substantial evidence that it is not feasible to
establish a wraparound program in that county.

(3) A program for services to adults and seniors in accordance
with Part 3 (commencing with Section 5800).

(4) A program for innovations in accordance with Part 3.2
(commencing with Section 5830).

(5) A program for technological needs and capital facilities
needed to provide services pursuant to Part 3 (commencing with
Section 5800), Part 3.6 (commencing with Section 5840), and Part
4 (commencing with Section 5850). All plans for proposed facilities
with restrictive settings shall demonstrate that the needs of the
people to be served cannot be met in a less restrictive or more
integrated setting, such as permanent supportive housing.

(6) Identification of shortages in personnel to provide services
pursuant to the above programs and the additional assistance
needed from the education and training programs established
pursuant to Part 3.1 (commencing with Section 5820).

(7) Establishment and maintenance of a prudent reserve to
ensure the county program will continue to be able to serve
children, adults, and seniors that it is currently serving pursuant
to Part 3 (commencing with Section 5800), the Adult and Older
Adult Mental Health System of Care Act, Part 3.6 (commencing
with Section 5840), Prevention and Early Intervention Programs,
and Part 4 (commencing with Section 5850), the Children’s Mental
Health Services Act, during years in which revenues for the Mental
Health Services Fund are below recent averages adjusted by
changes in the state population and the California Consumer Price
Index.

(8) Certification by the county behavioral health director, which
ensures that the county has complied with all pertinent regulations,
laws, and statutes of the Mental Health Services Act, including
stakeholder participation and nonsupplantation requirements.

(9) Certification by the county behavioral health director and
by the county auditor-controller that the county has complied with
any fiscal accountability requirements as directed by the State
Department of Health Care Services, and that all expenditures are
consistent with the requirements of the Mental Health Services
Act.

(c) The programs established pursuant to paragraphs (2) and
(3) of subdivision (b) shall include services to address the needs
of transition age youth 16 to 25 years of age. In implementing this
subdivision, county mental health programs shall consider the
needs of transition age foster youth.

(d) Each year, the State Department of Health Care Services
shall inform the County Behavioral Health Directors Association
of California and the Mental Health Services Oversight and
Accountability Commission of the methodology used for revenue
allocation to the counties.

(e) Each county mental health program shall prepare expenditure
plans pursuant to Part 3 (commencing with Section 5800) for adults
and seniors, Part 3.2 (commencing with Section 5830) for
innovative programs, Part 3.6 (commencing with Section 5840)
for prevention and early intervention programs, and Part 4
(commencing with Section 5850) for services for children, and
updates to the plans developed pursuant to this section. Each
expenditure update shall indicate the number of children, adults,
and seniors to be served pursuant to Part 3 (commencing with
Section 5800), and Part 4 (commencing with Section 5850), and
the cost per person. The expenditure update shall include utilization
of unspent funds allocated in the previous year and the proposed
expenditure for the same purpose.

(f) A county mental health program shall include an allocation
of funds from a reserve established pursuant to paragraph (7) of
subdivision (b) for services pursuant to paragraphs (2) and (3) of
subdivision (b) in years in which the allocation of funds for services
pursuant to subdivision (e) are not adequate to continue to serve
the same number of individuals as the county had been serving in
the previous fiscal year.

SEC. 3.  

Part 3.9 (commencing with Section 5849.1) is added
to Division 5 of the Welfare and Institutions Code, to read:

 

PART 3.9.  The No Place Like Home Program

 

5849.1.  

(a) The Legislature finds and declares that this part is
consistent with and furthers the purposes of the Mental Health
Services Act, enacted by Proposition 63 at the November 2, 2004,
statewide general election, within the meaning of Section 18 of
that measure.

(b) The Legislature further finds and declares all of the
following:

(1) Housing is a key factor for stabilization and recovery to
occur and results in improved outcomes for individuals living with
a mental illness.

(2) Untreated mental illness can increase the risk of
homelessness, especially for single adults.

(3) California has the nation’s largest homeless population that
is disproportionally comprised of women with children, veterans,
and the chronically homeless.

(4) California has the largest number of homeless veterans in
the United States at 24 percent of the total population in our nation.
Fifty percent of California’s veterans live with serious mental
illness and 70 percent have a substance use disorder.

(5) Fifty percent of mothers experiencing homelessness have
experienced a major depressive episode since becoming homeless
and 36 percent of these mothers live with post-traumatic stress
disorder and 41 percent have a substance use disorder.

(6) Ninety-three percent of supportive housing tenants who live
with mental illness and substance use disorders voluntarily
participated in the services offered.

(7) Adults who receive 2 years of “whatever-it-takes,” or Full
Service Partnership services, experience a 68 percent reduction in
homelessness.

(8) For every dollar of bond funds invested in permanent
supportive housing, the state and local governments can leverage
a significant amount of additional dollars through tax credits,
Medicaid health services funding, and other housing development
funds.

(9) Tenants of permanent supportive housing reduced their visits
to the emergency department by 56 percent, and their hospital
admissions by 45 percent.

(10) The cost in public services for a chronically homeless
Californian ranges from $60,000 to $100,000 annually. When
housed, these costs are cut in half and some reports show reductions
in cost of more than 70 percent, including potentially less
involvement with the health and criminal justice systems.

(11) Californians have identified homelessness as their top tier
priority; this measure seeks to address the needs of the most
vulnerable people within this population.

(12) Having counties provide mental health programming and
services is a benefit to the state.

5849.2.  

As used in this part, the following definitions shall
apply:

(a) “At risk of chronic homelessness” includes, but is not limited
to, persons who are at high risk of long-term or intermittent
homelessness, including persons with mental illness exiting
institutionalized settings, including, but not limited to, jail and
mental health facilities, who were homeless prior to admission,
transition age youth experiencing homelessness or with significant
barriers to housing stability, and others, as defined in program
guidelines.

(b) “Chronically homeless” has the same meaning as defined
in Section 578.3 of Title 24 of the Code of Federal Regulations,
as that section read on May 1, 2016.

(c) “Committee” means the No Place Like Home Program
Advisory Committee established pursuant to Section 5849.3.

(d) “County” includes, but is not limited to, a city and county.

(e) “Department” means the Department of Housing and
Community Development.

(f) “Development sponsor” has the same meaning as “sponsor”
as defined in Section 50675.2 of the Health and Safety Code.

(g) “Fund” means the No Place Like Home Fund established
pursuant to Section 5849.4.

(h) “Homeless” has the same meaning as defined in Section
578.3 of Title 24 of the Code of Federal Regulations, as that section
read on May 1, 2016.

(i) “Permanent supportive housing” has the same meaning as
“supportive housing,” as defined in Section 50675.14 of the Health
and Safety Code, except that “permanent supportive housing” shall
include associated facilities if used to provide services to housing
residents.

(j) “Program” means the process for awarding funds and
distributing moneys to applicants established in Sections 5849.7,
5849.8, and 5849.9.

(1) “Competitive program” means that portion of the program
established by Section 5849.8.

(2) “Distribution program” means that portion of the program
described in Section 5849.9.

(k) “Target population” means individuals or households as
provided in Section 5600.3 who are homeless, chronically
homeless, or at risk of chronic homelessness.

5849.3.  

(a) There is hereby established the No Place Like
Home Program Advisory Committee. Membership on the
committee shall be as follows:

(1) The Director of Housing and Community Development, or
his or her designee, who shall serve as the chairperson of the
committee.

(2) The Director of Health Care Services, or his or her designee,
and an additional representative.

(3) The Secretary of Veterans Affairs, or his or her designee.

(4) The Director of Social Services, or his or her designee.

(5) The Treasurer, or his or her designee.

(6) The chair of the Mental Health Services Oversight and
Accountability Commission, or his or her designee.

(7) A chief administrative officer of a small county or a member
of a county board of supervisors of a small county, as provided by
subdivision (d) of Section 5489.6, to be appointed by the Governor.

(8) A chief administrative officer of a large county or a member
of a county board of supervisors of a large county, as provided by
subdivision (b) of Section 5489.6, to be appointed by the Governor.

(9) A director of a county behavioral health department, to be
appointed by the Governor.

(10) An administrative officer of a city, to be appointed by the
Governor.

(11) A representative of an affordable housing organization, to
be appointed by the Speaker of the Assembly.

(12) A resident of supportive housing, to be appointed by the
Governor.

(13) A representative of a community mental health
organization, to be appointed by the Senate Rules Committee.

(14) A representative of a local or regional continuum of care
organization that coordinates homelessness funding, to be
appointed by the Governor.

(b) The committee shall do all of the following:

(1) Assist and advise the department in the implementation of
the program.

(2) Review and make recommendations on the department’s
guidelines.

(3) Review the department’s progress in distributing moneys
pursuant to this part.

(4) Provide advice and guidance more broadly on statewide
homelessness issues.

5849.4.  

(a) The No Place Like Home Fund is hereby created
within the State Treasury and, notwithstanding Section 13340 of
the Government Code, continuously appropriated to the department
for the purposes of this part. The department may use up to five
percent of the amount deposited in the fund for administrative
expenses in implementing this part.

(b) There shall be paid into the fund the following:

(1) Any proceeds from the issuance of bonds by the Treasurer
for the purpose of implementing the program.

(2) Any other federal or state grant, or from any private donation
or grant, for the purposes of this part.

(3) Any interest payment, loan repayments, or other return of
funds.

5849.5.  

(a) The department may adopt guidelines or regulations
as necessary to exercise the powers and perform the duties
conferred or imposed on it by this part. Any guideline or regulation
adopted pursuant to this section shall not be subject to the
requirements of the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code). The department shall consult with
key stakeholders including, but not limited to, counties.

(b) The department may adopt emergency regulations in order
to expedite the award of moneys pursuant to this part.

5849.6.  

For the purpose of administering this part, the
department shall organize counties into the following competitive
groupings based on population:

(a) The County of Los Angeles.

(b) Large counties with a population greater than 750,000.

(c) Medium counties with a population between 200,000 to
750,000.

(d) Small counties with a population less than 200,000.

The competitive program shall distribute funding among the
groupings based on a calculation made by the department that shall
include the number of homeless persons residing within each
county, as determined by the department, and considers minimum
funding levels necessary for a permanent supportive housing
development. The department, at its discretion, may consider other
factors in the calculation if it supports the objectives of this part.

5849.7.  

(a) The department shall administer a competitive
program, pursuant to Section 5849.8, and distribution program,
pursuant to Section 5849.9, for awarding a total of two billion
dollars ($2,000,000,000) among counties to finance capital costs
including, but not limited to, acquisition, design, construction,
rehabilitation, or preservation, and to capitalize operating reserves,
of permanent supportive housing for the target population.

(b) For the competitive program established by Section 5849.8,
the following shall apply:

(1) A county may apply as the sole applicant if it is the
development sponsor or jointly with a separate entity as
development sponsor.

(2) Funded developments shall integrate the target population
with the general public.

(3) Funded developments shall utilize low barrier tenant
selection practices that prioritize vulnerable populations and offer
flexible, voluntary, and individualized supportive services.

(4) The guidelines may provide for alternative housing models,
such as shared housing models of fewer than five units. Integration
requirements may be modified in shared housing.

(5) Funds shall be offered as deferred payment loans to finance
capital costs including acquisition, design, construction,
rehabilitation, or preservation, and to capitalize operating reserves
of, permanent supportive housing for the target population.

(6) The department shall adopt guidelines establishing income
and rent standards.

5849.8.  

(a) One billion eight hundred million dollars
($1,800,000,000) shall be allocated from the fund for the purposes
of the competitive program. The department shall develop a
competitive application process for the purpose of awarding
moneys pursuant to this section. In considering applications, the
department shall do all of the following:

(1) Restrict eligibility to applicants that meet the following
minimum criteria:

(A) The county commits to provide mental health supportive
services and to coordinate the provision of or referral to other
services, including, but not limited to, substance use treatment
services, to the tenants of the supportive housing development for
at least 20 years. Services shall be provided onsite at the supportive
housing development or in a location otherwise easily accessible
to tenants. The county may use, but is not restricted to using, any
of the following available funding sources as allowed by state and
federal law:

(i) The Local Mental Health Services Fund established pursuant
to subdivision (f) of Section 5892.

(ii) The Mental Health Account within the Local Health Welfare
Trust Fund established pursuant to Section 17600.10.

(iii) The Behavioral Health Subaccount within the County Local
Revenue Fund 2011 established pursuant to paragraph (4) of
subdivision (f) of Section 30025 of the Government Code.

(iv) Funds received from other private or public entities.

(v) Other county funds.

(B) The county has developed a county plan to combat
homelessness, which includes a description of homelessness
countywide, any special challenges or barriers to serving the target
population, county resources applied to address the issue, available
community-based resources, an outline of partners and
collaborations, and proposed solutions.

(C) Meet other threshold requirements including, but not limited
to, developer capacity to develop, own, and operate a permanent
supportive housing development for the target population,
application proposes a financially feasible development with
reasonable development costs.

(2) The department shall evaluate applications using, at
minimum, the following criteria:

(A) The extent to which units assisted by the program are
restricted to persons who are chronically homeless or at risk of
chronic homelessness within the target population.

(B) The extent to which funds are leveraged for capital costs.

(C) The extent to which projects achieve deeper affordability
through the use of non-state project-based rental assistance,
operating subsidies, or other funding.

(D) Project readiness.

(E) The extent to which applicants offer a range of on and
off-site supportive services to tenants, including mental health
services, behavioral health services, primary health, employment,
and other tenancy support services.

(b) The department may establish an alternative process for
allocating funds directly to counties, as calculated in Section
5849.6, with at least five percent of the state’s homeless population
and that demonstrate the capacity to directly administer loan funds
for permanent supportive housing serving the target population
and the ability to prioritize individuals with mental health
supportive needs who are homeless or at risk of chronic
homelessness, consistent with this part and as determined by the
department. The department shall adopt guidelines establishing
the parameters of an alternative process, if any, and requirements
for local administration of funds, including, but not limited to,
project selection process, eligible use of funds, loan terms, rent
and occupancy restrictions, provision of services, and reporting
and monitoring requirements. Counties participating in the
alternative process shall not be eligible for the competitive process
and shall be limited to the amount calculated in Section 5849.6.
Funds not committed to supportive housing developments within
two years following award of funds to counties shall be returned
to the state for the purposes of the competitive program. The
department shall consider the following when selecting
participating counties:

(1) Demonstrated ability to finance permanent supportive
housing with local and federal funds, and monitor requirements
for the life of the loan.

(2) Past history of delivering supportive services to the target
population in housing.

(3) Past history of committing project-based vouchers to
supportive housing.

(4) Ability to prioritize the most vulnerable within the target
population through coordinated entry system.

(c) The department shall set aside 8 percent of funds offered in
Rounds 1 through 4, inclusive, for small counties as provided in
subdivision (d) of Section 5849.6.

(d) The department shall award funds in at least four rounds as
follows:

(1) The department shall issue its first request for proposal for
the competitive program no later than 180 days after any deadline
for appeals as set forth in Section 870 of the Code of Civil
Procedure.

(2) The second round shall be completed no later than one year
after the completion of the first round.

(3) The third round shall be completed no later than one year
after the completion of the second round.

(4) The fourth round shall be completed no later than one year
after the completion of the third round.

(5) Subsequent rounds shall occur annually thereafter in order
to fully exhaust remaining funds and the department may
discontinue the use of the competitive groupings in Section 5849.6,
the alternative process in subdivision (b) for any funds not awarded
by the county, and the rural set aside funds as set forth in
subdivision (c).

(e) (1) Any loans made by the department pursuant to this
section shall be in the form of secured deferred payment loans to
pay for the eligible costs of development. Principal and
accumulated interest is due and payable upon completion of the
term of the loan, which shall be established through program
guidelines adopted pursuant to Section 5849.5. The loan shall bear
simple interest at a rate of three percent per annum on the unpaid
principal balance. The department shall require annual loan
payments in the minimum amount necessary to cover the costs of
project monitoring. For the first 15 years of the loan term, the
amount of the required loan payments shall not exceed forty-two
hundredths of 1 percent per annum.

(2) The department may establish maximum loan-to-value
requirements for some or all of the types of projects that are eligible
for funding under this part, which shall be established through
program guidelines adopted pursuant to Section 5849.5.

(3) The department shall establish per-unit and per-project loan
limits for all project types.

(f) (1) The department may designate an amount not to exceed
four percent of funds allocated for the competitive program, not
including funding allocated pursuant to subdivision (b), in order
to cure or avert a default on the terms of any loan or other
obligation by the recipient of financial assistance, or bidding at
any foreclosure sale where the default or foreclosure sale would
jeopardize the department’s security in the rental housing
development assisted pursuant to this part. The funds so designated
shall be known as the “default reserve.”

(2) The department may use default reserve funds made
available pursuant to this section to repair or maintain any rental
housing development assistance pursuant to this part to protect the
department’s security interest.

(3) The payment or advance of funds by the department pursuant
to this subdivision shall be exclusively within the department’s
discretion, and no person shall be deemed to have any entitlement
to the payment or advance of those funds. The amount of any funds
expended by the department for the purposes of curing or averting
a default shall be added to the loan amount secured by the rental
housing development and shall be payable to the department upon
demand.

(g) (1) Prior to disbursement of any funds for loans made
pursuant this section, the department shall enter into a regulatory
agreement with the developer that provides for all of the following:

(A) Sets standards for tenant selection to ensure occupancy of
assisted units by eligible households of very low and low income
for the term of the agreement.

(B) Governs the terms of occupancy agreements.

(C) Contains provisions to maintain affordable rent levels to
serve eligible households.

(D) Provides for periodic inspections and review of year-end
fiscal audits and related reports by the department.

(E) Permits a developer to distribute earnings in an amount
established by the department and based on the number of units
in the rental housing development.

(F) Has a term for not less than the original term of the loan.

(G) Contains any other provisions necessary to carry out the
purposes of this part.

(2) The agreement shall be binding upon the developer and
successors in interest upon sale or transfer of the rental housing
development regardless of any prepayment of the loan.

(3) The agreement shall be recorded in the office of the county
recorder in the county in which the real property subject to the
agreement is located.

5849.9.  

(a) In addition to the competitive program established
by Section 5849.8, the department shall distribute two hundred
million dollars ($200,000,000) from the fund on an
“over-the-counter” basis to finance the construction, rehabilitation,
or preservation, and to capitalize operating reserves, of permanent
supportive housing for individuals in the target population with a
priority for those with mental health supportive needs who are
homeless or at risk of chronic homelessness. Funds to be awarded
pursuant to this section shall be available to all counties within the
state proportionate to the number of homeless persons residing
within each county as calculated in Section 5849.6.

(b) Funds not awarded within 18 months following the first
allocation of moneys in accordance with subdivision (d) shall be
used for the purposes of the competitive program.

(c) The moneys described in subdivision (a) shall be
administered either in accordance with the procedures for awarding
funds to local agencies established by the existing Mental Health
Services Act housing program administered by the Department of
Health Care Services and the California Housing Finance Agency
or alternative procedures developed by the department for
distributing these moneys that enhance the efficiency and goals of
the distribution program.

(d) The department shall make the first allocation of moneys
pursuant to this section no later than 60 days after any deadline
for appeals as set forth in Section 870 of the Code of Civil
Procedure.

5849.10.  

(a) The sum of six million two hundred thousand
dollars ($6,200,000) is hereby appropriated from the Mental Health
Services Fund to the department to provide technical and
application preparation assistance to counties.

(b) Eligible use of technical and application preparation
assistance shall include, but is not limited to, assistance in
performing one or more of the following activities:

(1) Applying for program funds.

(2) Implementing activities funded by moneys distributed
pursuant to this part, including the development of supportive
housing for the target population.

(3) Coordinating funded activities with local homelessness
systems, including coordinated access systems developed pursuant
to Section 578.7(a)(8) of Title 24 of the Code of Federal
Regulations, as that section read on May 1, 2016.

(4) Delivering a range of supportive services to tenants.

(5) Collecting data, evaluating program activities, and sharing
data among multiple systems, such as the Mental Health Services
Act, enacted by Proposition 63 at the November 2, 2004, statewide
general election, the Medi-Cal Act (Chapter 7 (commencing with
Section 14000) of Part 3 of Division 9) and implementing
regulations, and homelessness systems.

(c) The department shall provide funds to a county upon
application as follows:

(1) To a large county and to the County of Los Angeles, the
department shall provide one hundred fifty thousand dollars
($150,000).

(2) To a medium county, the department shall provide one
hundred thousand dollars ($100,000).

(3) To a small county, the department shall provide seventy-five
thousand dollars ($75,000).

(d) If a county does not expend the moneys allocated pursuant
to subdivision (c) by June 30, 2020, those moneys shall be used
to augment the funding pursuant to subdivision (e).

(e) The department may contract for expert technical assistance
and application preparation assistance. The department shall deploy
such assistance to counties based upon a process to be defined in
guidelines.

(f) The department may establish a unit for the purpose of
providing technical assistance to counties.

5849.11.  

(a) The counties shall annually report to the
department on activities funded under this part, including
information on the funded supportive housing development.
Reported information shall include location of projects, number
of units assisted, occupancy restrictions, number of individuals
and households served, related income levels, and homeless,
veteran, and mental health status

(b) The department shall submit a report on the program to the
Legislature by December 31 of each year, commencing with the
year after the first full year in which the program is in effect. The
report shall contain the following:

(1) The processes established for distributing funds.

(2) The distribution of funds among counties.

(3) Any recommendations as to modifications to the program
for the purpose of improving efficiency or furthering the goals of
the program.

(c) The report required to be submitted by subdivision (b) shall
be submitted in compliance with Section 9795 of the Government
Code.

5849.12.  

(a) Upon an appropriation of funds for the purpose
of this section, the department shall contract with a public or private
research university in this state to evaluate the program. The
department shall develop the research design and issue a request
for proposal for a contract for the evaluation, with the assistance
of the Legislative Analyst’s Office and the Department of Finance.

(b) The department shall submit the final research design and
request for proposal required by subdivision (a) to the Chairperson
of the Joint Legislative Budget Committee no more than 30 days
prior to executing a contract for the evaluation.

5849.13.  

An action to determine the legality of any action by
the department pursuant to this part may be brought pursuant to
Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of
the Code of Civil Procedure.

5849.14.  

The Department of Finance may authorize a loan
from the General Fund to the No Place Like Home Fund for
cashflow purposes in an amount not to exceed one million dollars
($1,000,000) subject to the following conditions:

(a) The loan is to allow the department to begin program
implementation activities, including, but not limited to, drafting
program guidelines and regulations.

(b) The loan is short term, and shall be repaid within 30 days
after the deposit of bond proceeds into the fund pursuant to
paragraph (1) of subdivision (b) of Section 5849.4.

(c) Interest charges may be waived pursuant to subdivision (e)
of Section 16314 of the Government Code.

SEC. 4.  

The Legislature finds and declares that this act furthers
the intent of the Mental Health Services Act, enacted by
Proposition 63 at the November 2, 2004, statewide general election.

It is intent of the Legislature that the costs to service the debt
for the bond authorized by this act shall not impede in any way
the direct mental health services provided by counties, and that
the counties shall maximize the use of all available state, federal,
and local funding sources, including those listed in Section 5849.7
of the Welfare and Institutions Code, to support direct local mental
health services.

SEC. 5.  

This act is a bill providing for appropriations related
to the Budget Bill within the meaning of subdivision (e) of Section
12 of Article IV of the California Constitution, has been identified
as related to the budget in the Budget Bill, and shall take effect
immediately.

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