BILL NUMBER: AB 1576 CHAPTERED 07/14/99 CHAPTER 126 FILED WITH SECRETARY OF STATE JULY 14, 1999 APPROVED BY GOVERNOR JULY 14, 1999 PASSED THE ASSEMBLY JULY 6, 1999 PASSED THE SENATE JUNE 24, 1999 AMENDED IN SENATE JUNE 21, 1999 AMENDED IN SENATE JUNE 10, 1999 INTRODUCED BY Committee on Health (Gallegos (Chair), Baugh (Vice Chair), Bates, Firebaugh, Kuehl, Steinberg, Thomson, Vincent and Wildman) FEBRUARY 26, 1999 An act to amend Sections 130100, 130105, 130110, 130140, and 130155 of, and to amend the heading of Division 108 (commencing with Section 130100) of, the Health and Safety Code, and to amend Sections 30131, 30131.3, and 30131.4 of, and to amend the heading of Article 3 (commencing with Section 30131) of Chapter 2 of Part 13 of Division 2 of, the Revenue and Taxation Code, relating to child development, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 1576, Committee on Health. Children and family health programs. (1) The California Children and Families First Act of 1998 establishes the California Children and Families First Program, funded by certain surtaxes imposed on the sale and distribution of cigarettes and tobacco products and deposited into the California Children and Families First Trust Fund Account, to be used for the implementation of comprehensive early childhood development and smoking prevention programs. Existing law requires that funds in the account be distributed to those counties that elect to participate in the program by creating county commissions and meeting other criteria. This bill would rename that program the California Children and Families Program. This bill would also define "relevant county" for purposes of the program. (2) An initiative measure, the act provides that it may be amended only by a vote of 2/3 of the membership of both houses of the Legislature and that all amendments to the act shall be to further the act and must be consistent with its purposes. This bill, in conformance with those requirements, would declare that its provisions further the act and are consistent with its purposes. (3) This bill would declare that it is to take effect immediately as an urgency statute. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The heading of Division 108 (commencing with Section 130100) of the Health and Safety Code is amended to read: DIVISION 108. CALIFORNIA CHILDREN AND FAMILIES PROGRAM SEC. 2. Section 130100 of the Health and Safety Code is amended to read: 130100. There is hereby created a program in the state for the purposes of promoting, supporting, and improving the early development of children from the prenatal stage to five years of age. These purposes shall be accomplished through the establishment, institution, and coordination of appropriate standards, resources, and integrated and comprehensive programs emphasizing community awareness, education, nurturing, child care, social services, health care, and research. (a) It is the intent of this act to facilitate the creation and implementation of an integrated, comprehensive, and collaborative system of information and services to enhance optimal early childhood development. This system should function as a network that promotes accessibility to all information and services from any entry point into the system. It is further the intent of this act to emphasize local decisionmaking, to provide for greater local flexibility in designing delivery systems, and to eliminate duplicate administrative systems. (b) The programs authorized by this act shall be administered by the California Children and Families Commission and by county children and families commissions. In administering this act, the state and county commissions shall use outcome-based accountability to determine future expenditures. (c) This division shall be known and may be cited as the "California Children and Families Act of 1998." SEC. 3. Section 130105 of the Health and Safety Code is amended to read: 130105. The California Children and Families Trust Fund is hereby created in the State Treasury. (a) The California Children and Families Trust Fund shall consist of moneys collected pursuant to the taxes imposed by Section 30131.2 of the Revenue and Taxation Code. (b) All costs to implement this act shall be paid from moneys deposited in the California Children and Families Trust Fund. (c) The State Board of Equalization shall determine within one year of the passage of this act the effect that additional taxes imposed on cigarettes and tobacco products by this act has on the consumption of cigarettes and tobacco products in this state. To the extent that a decrease in consumption is determined by the State Board of Equalization to be the direct result of additional taxes imposed by this act, the State Board of Equalization shall determine the fiscal effect the decrease in consumption has on the funding of any Proposition 99 (the Tobacco Tax and Health Protection Act of 1988) state health-related education or research programs in effect as of November 1, 1998, and the Breast Cancer Fund programs that are funded by excise taxes on cigarettes and tobacco products. Funds shall be transferred from the California Children and Families Trust Fund to those affected programs as necessary to offset the revenue decrease directly resulting from the imposition of additional taxes by this act. Such reimbursements shall occur, and at such times, as determined necessary to further the intent of this subdivision. (d) Moneys shall be allocated and appropriated from the California Children and Families Trust Fund as follows: (1) Twenty percent shall be allocated and appropriated to separate accounts of the state commission for expenditure according to the following formula: (A) Six percent shall be deposited in a Mass Media Communications Account for expenditures for communications to the general public utilizing television, radio, newspapers, and other mass media on subjects relating to and furthering the goals and purposes of this act, including, but not limited to, methods of nurturing and parenting that encourage proper childhood development, the informed selection of child care, information regarding health and social services, the prevention of tobacco, alcohol, and drug use by pregnant women, and the detrimental effects of secondhand smoke on early childhood development. (B) Five percent shall be deposited in an Education Account for expenditures for programs relating to education, including, but not limited to, the development of educational materials, professional and parental education and training, and technical support for county commissions in the areas described in subparagraph (A) of paragraph (1) of subdivision (b) of Section 130125. (C) Three percent shall be deposited in a Child Care Account for expenditures for programs relating to child care, including, but not limited to, the education and training of child care providers, the development of educational materials and guidelines for child care workers, and other areas described in subparagraph (B) of paragraph (1) of subdivision (b) of Section 130125. (D) Three percent shall be deposited in a Research and Development Account for expenditures for the research and development of best practices and standards for all programs and services relating to early childhood development established pursuant to this act, and for the assessment and quality evaluation of such programs and services. (E) One percent shall be deposited in an Administration Account for expenditures for the administrative functions of the state commission. (F) Two percent shall be deposited in an Unallocated Account for expenditure by the state commission for any of the purposes of this act described in Section 130100 provided that none of these moneys shall be expended for the administrative functions of the state commission. (G) In the event that, for whatever reason, the expenditure of any moneys allocated and appropriated for the purposes specified in subparagraphs (A) to (F), inclusive, is enjoined by a final judgment of a court of competent jurisdiction, then those moneys shall be available for expenditure by the state commission for mass media communication emphasizing the need to eliminate smoking and other tobacco use by pregnant women, the need to eliminate smoking and other tobacco use by persons under 18 years of age, and the need to eliminate exposure to secondhand smoke. (H) Any moneys allocated and appropriated to any of the accounts described in subparagraphs (A) to (F), inclusive, that are not encumbered or expended within any applicable period prescribed by law shall (together with the accrued interest on the amount) revert to and remain in the same account for the next fiscal period. (2) Eighty percent shall be allocated and appropriated to county commissions in accordance with Section 130140. (A) The moneys allocated and appropriated to county commissions shall be deposited in each local Children and Families Trust Fund administered by each county commission, and shall be expended only for the purposes authorized by this act and in accordance with the county strategic plan approved by each county commission. (B) Any moneys allocated and appropriated to any of the county commissions that are not encumbered or expended within any applicable period prescribed by law shall (together with the accrued interest on the amount) revert to and remain in the same local Children and Families Trust Fund for the next fiscal period under the same conditions as set forth in subparagraph (A). (e) All grants, gifts, or bequests of money made to or for the benefit of the state commission from public or private sources to be used for early childhood development programs shall be deposited in the California Children and Families Trust Fund and expended for the specific purpose for which the grant, gift, or bequest was made. The amount of any such grant, gift, or bequest shall not be considered in computing the amount allocated and appropriated to the state commission pursuant to paragraph (1) of subdivision (d). (f) All grants, gifts, or bequests of money made to or for the benefit of any county commission from public or private sources to be used for early childhood development programs shall be deposited in the local Children and Families Trust Fund and expended for the specific purpose for which the grant, gift, or bequest was made. The amount of any such grant, gift, or bequest shall not be considered in computing the amount allocated and appropriated to the county commissions pursuant to paragraph (2) of subdivision (d). SEC. 4. Section 130110 of the Health and Safety Code is amended to read: 130110. There is hereby established a California Children and Families Commission composed of seven voting members and two ex officio members. (a) The voting members shall be selected, pursuant to Section 130115, from persons with knowledge, experience, and expertise in early child development, child care, education, social services, public health, the prevention and treatment of tobacco and other substance abuse, behavioral health, and medicine (including, but not limited to, representatives of statewide medical and pediatric associations or societies), upon consultation with public and private sector associations, organizations, and conferences composed of professionals in these fields. (b) The Secretary of the California Health and Human Services Agency and the Secretary for Education, or their designees, shall serve as ex officio nonvoting members of the state commission. SEC. 5. Section 130140 of the Health and Safety Code is amended to read: 130140. Any county or counties developing, adopting, promoting, and implementing local early childhood development programs consistent with the goals and objectives of this act shall receive moneys pursuant to paragraph (2) of subdivision (d) of Section 130105 in accordance with the following provisions: (a) For the period between January 1, 1999 and June 30, 2000, county commissions shall receive the portion of the total moneys available to all county commissions equal to the percentage of the number of births recorded in the relevant county (for the most recent reporting period) in proportion to the entire number of births recorded in California (for the same period), provided that each of the following requirements has first been satisfied: (1) The county's board of supervisors has adopted an ordinance containing the following minimum provisions: (A) The establishment of a county children and families commission. The county commission shall be appointed by the board of supervisors and shall consist of at least five but not more than nine members. (i) Two members of the county commission shall be from among the county health officer and persons responsible for management of the following county functions: children's services, public health services, behavioral health services, social services, and tobacco and other substance abuse prevention and treatment services. (ii) One member of the county commission shall be a member of the board of supervisors. (iii) The remaining members of the county commission shall be from among the persons described in clause (i) and persons from the following categories: recipients of project services included in the county strategic plan; educators specializing in early childhood development; representatives of a local child care resource or referral agency, or a local child care coordinating group; representatives of a local organization for prevention or early intervention for families at risk; representatives of community-based organizations that have the goal of promoting nurturing and early childhood development; representatives of local school districts; and representatives of local medical, pediatric, or obstetric associations or societies. (B) The manner of appointment, selection, or removal of members of the county commission, the duration and number of terms county commission members shall serve, and any other matters that the board of supervisors deems necessary or convenient for the conduct of the county commission's activities, provided that members of the county commission shall not be compensated for their services, except they shall be paid reasonable per diem and reimbursement of reasonable expenses for attending meetings and discharging other official responsibilities as authorized by the county commission. (C) The requirement that the county commission adopt an adequate and complete county strategic plan for the support and improvement of early childhood development within the county. (i) The county strategic plan shall be consistent with, and in furtherance of the purposes of, this act and any guidelines adopted by the state commission pursuant to subdivision (b) of Section 130125 that are in effect at the time the plan is adopted. (ii) The county strategic plan shall, at a minimum, include the following: a description of the goals and objectives proposed to be attained; a description of the programs, services, and projects proposed to be provided, sponsored, or facilitated; and a description of how measurable outcomes of such programs, services, and projects will be determined by the county commission using appropriate reliable indicators. No county strategic plan shall be deemed adequate or complete until and unless the plan describes how programs, services, and projects relating to early childhood development within the county will be integrated into a consumer-oriented and easily accessible system. (iii) The county commission shall, on at least an annual basis, be required to periodically review its county strategic plan and to revise the plan as may be necessary or appropriate. (D) The requirement that the county commission conduct at least one public hearing on its proposed county strategic plan before the plan is adopted. (E) The requirement that the county commission conduct at least one public hearing on its periodic review of the county strategic plan before any revisions to the plan are adopted. (F) The requirement that the county commission submit its adopted county strategic plan, and any subsequent revisions thereto, to the state commission. (G) The requirement that the county commission prepare and adopt an annual audit and report pursuant to Section 130150. The county commission shall conduct at least one public hearing prior to adopting any annual audit and report. (H) The requirement that the county commission conduct at least one public hearing on each annual report by the state commission prepared pursuant to subdivision (b) of Section 130150. (I) Two or more counties may form a joint county commission, adopt a joint county strategic plan, or implement joint programs, services, or projects. (2) The county's board of supervisors has established a county commission and has appointed a majority of its members. (3) The county has established a local Children and Families Trust Fund pursuant to subparagraph (A) of paragraph (2) of subdivision (d) of Section 130105. (b) Notwithstanding any provision of this act to the contrary, no moneys made available to county commissions under subdivision (a) shall be expended to provide, sponsor, or facilitate any programs, services, or projects for early childhood development until and unless the county commission has first adopted an adequate and complete county strategic plan that contains the provisions required by clause (ii) of subparagraph (C) of paragraph (1) of subdivision (a). (c) In the event that any county elects not to participate in the California Children and Families Program, the moneys remaining in the California Children and Families Trust Fund shall be reallocated and reappropriated to participating counties in the following fiscal year. (d) For the fiscal year commencing on July 1, 2000, and for each fiscal year thereafter, county commissions shall receive the portion of the total moneys available to all county commissions equal to the percentage of the number of births recorded in the relevant county (for the most recent reporting period) in proportion to the number of births recorded in all of the counties participating in the California Children and Families Program (for the same period), provided that each of the following requirements has first been satisfied: (1) The county commission has, after the required public hearings, adopted an adequate and complete county strategic plan conforming to the requirements of subparagraph (C) of paragraph (1) of subdivision (a), and has submitted the plan to the state commission. (2) The county commission has conducted the required public hearings, and has prepared and submitted all audits and reports required pursuant to Section 130150. (3) The county commission has conducted the required public hearings on the state commission annual reports prepared pursuant to subdivision (b) of Section 130150. (e) In the event that any county elects not to continue participation in the California Children and Families Program, any unencumbered and unexpended moneys remaining in the local Children and Families Trust Fund shall be returned to the California Children and Families Trust Fund for reallocation and reappropriation to participating counties in the following fiscal year. (f) For purposes of this section, "relevant county" means the county in which the mother of the child whose birth is being recorded resides. SEC. 6. Section 130155 of the Health and Safety Code is amended to read: 130155. The following definitions apply for purposes of this act: (a) "Act" means the California Children and Families Act of 1998. (b) "County commission" means each county children and families commission established in accordance with Section 130140. (c) "County strategic plan" means the plan adopted by each county children and families commission and submitted to the California Children and Families Commission pursuant to Section 130140. (d) "State commission" means the California Children and Families Commission established in accordance with Section 130110. SEC. 7. The heading of Article 3 (commencing with Section 30131) of Chapter 2 of Part 13 of Division 2 of the Revenue and Taxation Code is amended to read: Article 3. California Children and Families Trust Fund Account SEC. 8. Section 30131 of the Revenue and Taxation Code is amended to read: 30131. Notwithstanding Section 30122, the California Children and Families Trust Fund is hereby created in the State Treasury for the exclusive purpose of funding those provisions of the California Children and Families Act of 1998 that are set forth in Division 108 (commencing with Section 130100) of the Health and Safety Code. SEC. 9. Section 30131.3 of the Revenue and Taxation Code is amended to read: 30131.3. Except for payments of refunds made pursuant to Article 1 (commencing with Section 30361) of Chapter 6, reimbursement of the State Board of Equalization for expenses incurred in the administration and collection of the taxes imposed by Section 30131.2, and transfers of funds in accordance with subdivision (c) of Section 130105 of the Health and Safety Code, all moneys raised pursuant to the taxes imposed by Section 30131.2 shall be deposited in the California Children and Families Trust Fund and are continuously appropriated for the exclusive purpose of the California Children and Families Program established by Division 108 (commencing with Section 130100) of the Health and Safety Code. SEC. 10. Section 30131.4 of the Revenue and Taxation Code is amended to read: 30131.4. All moneys raised pursuant to taxes imposed by Section 30131.2 shall be appropriated and expended only for the purposes expressed in the California Children and Families Act, and shall be used only to supplement existing levels of service and not to fund existing levels of service. No moneys in the California Children and Families Trust Fund shall be used to supplant state or local General Fund money for any purpose. SEC. 11. The Legislature finds and declares that this act furthers the California Children and Families First Act of 1998 enacted by Proposition 10 at the November 3, 1998, general election, and is consistent with its purposes. SEC. 12. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to ensure that vital funding for the California Children and Families Program is distributed to the appropriate counties at the earliest possible time for expenditure for the purposes of the program, it is necessary that this act take effect immediately.