BILL ANALYSIS
SB 289
Page 1
SENATE THIRD READING
SB 289 (Ducheny)
As Amended August 24, 2010
Majority vote
SENATE VOTE :36-0
HEALTH 14-1
--------------------------------
|Ayes:|Monning, Fletcher, |
| |Carter, Conway, De La |
| |Torre, De Leon, Eng, |
| |Gaines, Hernandez, Bonnie |
| |Lowenthal, Nava, V. |
| |Manuel Perez, Salas, |
| |Audra Strickland |
| | |
|-----+--------------------------|
|Nays:|Ammiano |
| | |
--------------------------------
SUMMARY : Provides extensions to the hospital seismic mandate
for general acute care hospitals (GAC) that are reclassified
using a regulatory option or have encountered local planning
delays. Establishes additional posting and reporting
requirements for GACs with a building at risk of structural
damage during a major earthquake. Specifically, this bill :
1)Requires any person, political subdivision of the state, or
governmental agency seeking licensure for a GAC, as defined,
to file with the Department of Public Health (DPH) a statement
that it has complied with the Alfred E. Alquist Hospital
Facilities Seismic Safety Act of 1983 (Alquist Act) and has
received approval from the Office of Statewide Health Planning
and Development (OSHPD). Prohibits DPH from issuing a license
until these requirements are met.
2)Requires an individual or entity that seeks initial approval
to operate or manage a GAC, as defined, to file with DPH a
statement that describes the plan for the GAC to comply with
the Alquist Act. Requires the plan to include a description
of the financial capacity that the proposed owner or operator
anticipates to be sufficient to ensure timely compliance and a
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projected timeline for this compliance.
3)Requires the GAC applicant to provide the statement described
in 2) above to all of the following:
a) The Facility Development Division of OSHPD. Requires
OSHPD to post the statement on OSHPD's Internet Web site;
b) Any investor or entity holding more than 5% of the value
of the GAC;
c) Any real estate investment trust which holds an interest
in the property on which the GAC is located;
d) The entity responsible for providing property and
casualty insurance coverage for the GAC;
e) The entity responsible for the directors and the owner's
liability insurance for the management of the GAC;
f) The medical staff of the GAC;
g) The collective bargaining agent, if any, that has a
contract with the existing license holder;
h) The local planning departments within the local
jurisdiction of the GAC;
i) Any health care service plans or health insurers that
have had contracts with the GAC within the prior year; and,
j) Any contractor that employs workers at the GAC and, if
applicable, the collective bargaining agent representing
the subcontracted workers.
4)Requires DPH to consider whether the GAC applicant has
demonstrated a history of substantial compliance with seismic
safety requirements, based on information provided by OSHPD
regarding the record of compliance with respect to any other
facilities owned by the same applicant.
5)Prohibits failure to comply with 2) through 4) above from
being subject to criminal penalty, as specified.
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6)Adds the following additional conditions for OSHPD to grant an
extension of up to two years to eligible GACs that have
received an extension of the January 1, 2008 seismic deadline,
as specified, for a hospital building that the GAC owns or
operates:
a) The GAC owner provides documentation to OSHPD by January
20, 2011, stating the GAC owner's intent to comply with the
January 1, 2013, seismic deadline requirements, as
specified, by using computer modeling utilized by OSHPD
pursuant to regulations adopted after June 30, 2009, but
before December 30, 2010, and based upon Hazards US
(HAZUS);
b) The GAC owner submits to OSHPD by July 1, 2011, a
request for review using computer modeling utilized by
OSHPD pursuant to regulations adopted after June 30, 2009,
but before December 30, 2010, and based upon Hazards US,
and the GAC plans to construct a building to meet the
structural performance category 2 (SPC-2) requirement;
c) The GAC building plans for the building are submitted to
OSHPD and deemed ready for review by OSHPD prior to January
1, 2012. Requires the GAC to indicate, upon submission of
its plans, the SPC-1 building or buildings that are
required to be retrofitted or replaced to meet the
requirements of this bill as a result of the project.
Requires the GAC to also provide a proposed construction
timeframe to complete the project once the permit is
issued. Requires the construction timeframe to be approved
by OSHPD and only include the amount of time that is
reasonably necessary to complete the construction required
to meet the SPC-2 requirement;
d) The GAC receives a building permit from OSHPD for the
construction described in 6) b) above, prior to January 1,
2013;
e) The GAC provides documentation upon application stating
that the purpose of the construction is to meet seismic
requirements, as specified, to allow the use of the
building as a GAC building after the extension deadline
granted by OSHPD, as specified, and to make reasonable
progress toward meeting the timeline set forth in 6) c)
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above;
f) The additional extension granted by OSHPD, as specified,
may not exceed the lesser of two years or the amount of
time that is reasonably necessary to complete the
construction that is required for the building to meet the
SPC-2 requirement, as adjusted for delays in construction
that are beyond the control of the GAC; and,
g) The GAC owner completes construction in order for the
GAC to meet all of the criteria to enable OSHPD to issue a
certificate of occupancy by the applicable deadline for the
building.
7)Permits OSHPD to revoke an extension granted for any GAC
building where the work of construction is abandoned or
suspended for a period of at least six months, unless the
hospital demonstrates in a public document that the
abandonment or suspension was caused by factors beyond its
control.
8)Requires all submissions to OSHPD to obtain an extension of
the January 1, 2008, seismic deadline, as specified, to comply
with the requirements for the extension to be complete and
accurate. Requires OSHPD to deny or revoke an extension of
the January 1, 2008, seismic deadline, as specified, if OSHPD
determines that the information submitted did not meet this
standard.
9)Permits OSHPD, in lieu of the extension to the January 1,
2008, seismic deadline, as specified, to grant an extension to
a GAC, in accordance with 11) and 14) below, if the GAC
building will not be able to meet the seismic safety
standards, as specified, by January 1, 2013.
10)Requires the owner of the GAC, when applying for an extension
under the provisions of this bill, to submit to OSHPD
documentation that includes at least all of the following:
a) The schedule of the project or projects, as had been
originally anticipated;
b) The schedule of the project or projects, as currently
projected;
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c) Documentation that the timeline submitted to the local
planning authority or jurisdiction;
d) The local planning authority for the project and for the
enabling phases of the project does not grant approvals
prior to November 1, 2010, where the GAC had filed the
local application prior to January 1, 2009; and,
e) A proposed construction timeframe demonstrating the
completion of the project once the permit is issued.
Requires the construction timeframe to be approved by OSHPD
and to only include the amount of time that is reasonably
necessary to complete construction required to meet the
seismic requirements.
11)Permits OSHPD to grant an extension, in full one-year
increments, but no longer than three consecutive years, which
compensates for delays determined pursuant to 12) below.
12)Requires OSHPD to conduct a comprehensive review of the
schedule for the project and necessary enabling phases
according to criteria specified in this bill. Requires this
review to encompass the project under jurisdiction of OSHPD,
as well as enabling project phases not under the jurisdiction
of OSHPD. Requires OSHPD to consider the cumulative effect of
local approval timelines for all elements of the project and
necessary enabling phases, inclusive of changes in scope or
sequence of the project or its enabling phases. Permits OSHPD
to grant extensions based on evaluation of each of the
following circumstances:
a) Where the local planning authority approvals have
delayed or will delay the construction start date of the
project, or of an enabling phase of this project;
b) Where the local conditions of approval on a project or
on its enabling phases extend duration beyond the
originally anticipated construction completion date;
c) Where changes in sequence or processes the GAC deems
necessary to mitigate local concerns on the project or its
enabling phases delay the construction completion date;
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d) Where the cumulative effect of delays on the project or
on enabling phases create additional construction delays
due to local seasonal weather impacts;
e) Construction related to the seismic retrofit or
replacement project has begun by January 1, 2013;
f) The project was submitted for review by DPH no later
than January 1, 2009; and,
g) The project has received a building permit from DPH no
later than January 1, 2012, to complete construction on the
entire project.
13)Requires the GAC owner, every six months after the approval
of the extension, to report to OSHPD on the status of the
project, demonstrating that it is making reasonable progress
toward meeting the construction timeline. Requires the GAC to
also report any delays or circumstances that could materially
affect the estimated completion date.
14)Permits OSHPD to grant an additional extension of up to two
years in addition to the extension granted pursuant to 11) and
12) above, if the project meets the following criteria:
a) A matrix of buildings at the facility that identifies
compliance of each building to the standards required in
existing law at the completion of the project; and,
b) The construction timelines submitted pursuant to 9)
above were determined to go beyond three years from the
date the building permit was issued.
15)Permits OSHPD to revoke an extension granted pursuant to the
provisions of this bill for any GAC building where the work of
construction is abandoned or suspended for a period of at
least six months, unless the hospital demonstrates in a public
document that the abandonment or suspension was caused by
factors beyond its control.
16)Permits OSHPD to revoke an extension provided pursuant to the
provisions in this bill if it is determined the documentation
provided under 10) above was falsified in any manner by the
GAC.
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17)Requires regulatory submissions made by OSHPD to the
California Building Standards Commission pursuant to
provisions in this bill to be deemed and to be adopted as,
emergency regulations.
18)Permits a GAC denied an extension pursuant to the provisions
in this bill to appeal the assessment to the Hospital Building
Safety Board.
19)Requires a GAC, on or before January 1, 2017, to report all
of the following to OSHPD:
a) Current configuration of all buildings on its campus,
including each structural performance category;
b) The number of acute care beds and the basic and
supplemental services provided in each building; and,
c) Identification of each building that needs to meet the
structural and nonstructural requirements established in
existing law;
20)Requires a GAC, before January 1, 2020, to submit a master
plan for all the buildings that the GAC intends to rebuild or
replace by January 1, 2030. Requires the master plan to
identify at least all of the following:
a) Each building that is subject to be demolished, replaced
or changed to nonacute care use because it is not in
compliance with existing seismic law;
b) The current plan to rebuild or replace each building
with buildings that would be in compliance with existing
seismic law, including all structural and nonstructural
requirements;
c) The building or buildings to be removed from acute care
service and the projected date or dates of that action;
d) The location for any new building or buildings,
including, but not limited to, whether the owner has
received a permit for that location;
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e) A copy of the preliminary design for the new building or
buildings;
f) The number of beds available for acute care use in each
new building;
g) The timeline for completed plan submission;
h) The proposed construction timeline;
i) The proposed cost at the time of submission; and,
j) A copy of any records indicating the hospital governing
board's approval of the hospital master plan.
21)Requires on or before January 1, 2023, the GAC owner to
submit to OSHPD a building plan for each building that is
deemed ready for review by OSHPD.
22)Requires, on or before January 1, 2025, the GAC owner to
receive a building permit to begin construction for each
building that the owner intends to replace or retrofit
pursuant to the master plan.
23)Requires, within six months of receipt of the building
permit, the GAC owner to submit a construction timeline that
identifies at least all of the following:
a) Each building that is subject to be demolished, replaced
or changed to nonacute care use because it is not in
compliance with existing seismic law;
b) The project number or numbers for replacement of each
building;
c) The projected construction start date or dates and
projected construction completion date or dates;
d) The building or buildings to be removed from acute care;
e) The estimated cost of construction; and,
f) The name of the contractor.
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24)Requires the GAC owner, every six months thereafter, to
report to OSHPD on the status of the project, including any
delays or circumstances that could materially affect the
estimated completion date.
25)Requires a hospital that has not submitted a report to be
assessed a civil penalty of $10 per licensed acute care bed
per day, but in no case to exceed $1,000 per day for each
SPC-1 building not in compliance until it has complied.
Requires these civil penalties to be deposited into the
Facilities Penalties Account established 32) below. Permits a
GAC assessed a civil penalty to appeal the assessment to the
Hospital Building Safety Board.
26)Requires OSHPD to make the information required by 19) and
20) above, available on its Internet Web site within 90 days
of receipt of this information.
27)Permits a GAC that complies with seismic safety law to post a
sign at all public entrances to the GAC building that states:
"THE STATE OF CALIFORNIA HAS DETERMINED THAT THIS HOSPITAL
FACILITY HAS COMPLIED WITH APPLICABLE STATE SEISMIC SAFETY
LAWS FOR HOSPITALS."
28)Requires that a GAC that has a SPC-1 building to post a sign
at all public entrances to the building that states: "THE
STATE OF CALIFORNIA HAS DETERMINED THAT THIS HOSPITAL HAS
BUILDING(S) THAT ARE AT RISK OF COLLAPSE IN A MAJOR
EARTHQUAKE. The plan of compliance for this hospital is
available for your review at the hospital's Internet Web site
(insert Web site address). To receive additional information
regarding hospital seismic safety, go to www.oshpd.ca.gov."
29)Requires all signs posted pursuant to 27) or 28) above to be
posted in a conspicuous place at all public entrances of the
building, and not to be less than five inches by seven inches
in size and be printed in no less than 30-point bold-type.
30)Clarifies that the plan of compliance to be publicly
available in 28) above is the November 1, 2010 reporting
requirement, in existing law, for SPC-1 buildings.
31)Requires, by February 1, 2011, each GAC that has an SPC-1
building to certify in writing to OSHPD that it has complied
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with subdivision 28), 29), and 30) above. Requires failure to
post the sign required in subdivision 29) to result in the GAC
being assessed a civil penalty of $10 per licensed acute care
bed per each day that the GAC fails to post the sign, but in
no case to exceed $1,000 per day for each SPC-1 building.
32)Requires these fines to be deposited into the Facilities
Penalties Account which is hereby established within the
Hospital Building Fund established pursuant to existing law.
33)Permits a GAC assessed a civil penalty to appeal the
assessment to the Hospital Building Safety Board.
34)Prohibits moneys in the account from continuously
appropriated pursuant to this section, and are required to be
available for expenditure only upon appropriation by the
Legislature in the annual Budget Act or other measure.
35)Makes other technical and clarifying changes.
EXISTING LAW :
1)Establishes and grants OSHPD authority and responsibility for
reviewing and approving all plans relating to construction,
additions to, reconstruction, or alteration of, health care
facilities, as defined. Before adopting any such plans,
requires hospitals to submit the plans to OSHPD for approval
and to pay an application filing fee, as determined by OSHPD,
based on the project's estimated construction cost.
2)Establishes the Alquist Act, and its amendments, with the
following deadlines for seismic safety compliance:
a) After January 1, 2008, requires any GAC hospital
building that is determined to be a potential risk for
collapse or significant loss of life in a major earthquake
(i.e., designated as SPC-1) to be used only for non-acute
care purposes;
b) Authorizes OSHPD to extend the 2008 deadline by five
years, to January 1, 2013, if:
i) The hospital demonstrates that compliance with the
2008 deadline will result in a loss of health care
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capacity that may not be provided by other GAC hospitals
within a reasonable proximity, and other conditions are
met;
ii) The hospital agrees that by January 1, 2013,
designated services will be provided by moving into an
existing conforming building, relocating to a newly-built
building, or continuing in the retrofitted building, as
specified; or,
iii) The building is either retrofitted to SPC-2 and
Non-Structural Performance Category (NPC-3) standards, or
not used for GAC inpatient services, by January 1, 2013.
c) Authorizes OSHPD to extend the 2013 deadline by up to
two additional years, up to January 1, 2015, if the
hospital meets specified interim deadlines and is making
reasonable progress toward meeting its timeline to retrofit
or replace an SPC-1 building but is delayed due to factors
beyond its control;
d) Permits a hospital owner, in lieu of retrofitting or
rebuilding SPC-1 buildings by 2013, to instead replace them
by January 1, 2020, if:
i) The hospital meets specified conditions, including
serving Medi-Cal or indigent patients and underserved
areas, and OSHPD certifies that the hospital owner lacks
the financial capacity to meet seismic standards, as
defined; or,
ii) The nonconforming building is owned or operated by a
county, city, or county and city that lacks the ability
to meet the 2013 deadline but commits to replace the
buildings by January 1, 2020.
e) Requires, by January 1, 2030, all hospital buildings to
be capable of remaining intact after an earthquake, and
capable of continued operation and provision of acute care
medical services (designated as SPC-5), and requires owners
of all acute care inpatient hospitals to demolish, replace,
or change to non-acute care all hospital buildings not in
substantial compliance.
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3)Requires an owner of a GAC hospital building classified as
SPC-1, who has not requested an extension of the 2008
deadline, to submit a report to OSHPD no later than April 15,
2007, describing the status of each building in complying with
the deadline, and to identify the following:
a) Each building that is subject to the deadline;
b) The project number or numbers for retrofit or
replacement of each building;
c) The projected construction start date or dates and
projected construction completion date or dates; and,
d) The building or buildings to be removed from acute care
service and the projected date or dates of this action.
4)Requires owners of SPC-1 hospital buildings who have requested
an extension of the 2008 deadline to submit similar reports by
June 30, 2009, and November 1, 2010.
5)Requires OSHPD to make the information reported pursuant to 3)
and 4) above available on its Web site within 90 days of
receipt.
FISCAL EFFECT : This bill as amended has not been analyzed by a
fiscal committee.
COMMENTS : According to the author, current law requires GACs to
ensure buildings will not collapse from a major earthquake by
2013. The author maintains that, if they do not meet this
standard by then, GACs will be required to close. In order to
assist with moving as many hospitals along the path to
compliance, while addressing the very real barriers, such as
access to capital, the author maintains that this bill provides
limited extensions for a very narrow set of circumstances.
In 2008, a multidisciplinary working group of scientists and
engineers predicted that, within the next 30 years, California
has more than a 99% chance of having an earthquake equal to or
greater than the magnitude 6.7 Northridge earthquake of 1994.
The probability of a magnitude 6.7 or stronger earthquake
striking the Los Angeles area over the next 30 years is 67% and
63% for the San Francisco Bay Area.
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The Northridge earthquake resulted in enactment later that year
of SB 1953 (Alquist), Chapter 740, Statutes of 1994. SB 1953
expands the 1983 Alquist Act by establishing seismic standards
for GAC buildings and requiring every GAC building to comply
with the standards and to meet specific deadlines. By January
1, 2008, (or 2013/2015 if extensions have been granted), every
GAC hospital building must meet specific construction standards
established to keep these structures standing after a major
earthquake or be removed from acute care. By January 1, 2030,
all GAC buildings must comply with standards intended to keep
these buildings standing and operational following a severe
earthquake.
SPC classifications, ranging from SPC-1 to SPC-5, are used to
indicate the structural seismic risk of a hospital building in
the event of a major earthquake, with SPC-1 used to designate
buildings at potential risk of collapse or significant loss of
life in a major earthquake. Because SPC-1 buildings are
considered hazardous and at risk of collapse in the event of an
earthquake they are required under current law to be
retrofitted, replaced or removed from providing acute care
services by 2013.
The Multi-Hazard Loss Estimation Methodology, Earthquake Module
(known as Hazards US, or HAZUS) was developed by the Federal
Emergency Management Agency (FEMA) and is a standardized
methodology that estimates potential losses from earthquakes,
hurricanes, winds and floods. Due to strides in earthquake-risk
engineering that have occurred in the years since SB 1953
passed, the California Building Standards Commission in November
2007 and again this year in February 2010 approved the
implementation of HAZUS, to reexamine the collapse risk of SPC-1
GAC buildings. This bill provides GACs using HAZUS 2010 up to
an additional two years to mitigate through construction the
structural deficiencies that put the building at risk of
collapse in a major earthquake. Currently, GACs using the
previous regulatory model (HAZUS 2007) are provided up to two
additional years to complete their work and become seismically
compliant. The HAZUS reassessment allows OSHPD to move SPC-1
hospital buildings that meet specified criteria to SPC-2
category. If reclassified, these hospital buildings would move
from a 2013 seismic deadline to a 2030 deadline. According to
the author, as many as 400 GAC buildings could be re-classified
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and/or perform construction mitigation to be re-evaluated to
withstand a major earthquake. The author maintains that this
new evaluation will save hospitals up to $10 billion in
construction costs.
This bill provides a set of circumstances that permit GACs to
request from OSHPD an up to three year extension to comply with
state seismic safety requirements if the GAC has run into local
planning delays. GACs report that there are instances where the
local planning review and approval process for GAC construction
projects have taken longer than originally anticipated. This
bill attempts to address the issue of local planning delays and
timing by providing an opportunity for a limited number of
hospitals that are structurally rated as not having any patients
or employees in a SPC-1 building to achieve full seismic
compliance.
This bill requires each GAC with a building designated SPC-1 to
post a sign at each entrance stating its risk of collapse, and
directs the public to a website to view the GACs plan to meet
the seismic mandate.
Most of the current reporting requirements for GAC seismic
safety compliance were enacted in SB 1661 (Cox), Chapter 679,
Statutes of 2006. Among other provisions, SB 1661 requires all
hospitals with SPC-1 buildings to report information on
buildings to be retrofitted, replaced, or removed from acute
care service and to provide the projected dates of those
actions. The most recent report was due in June of 2009 and
while the data gather from these reports provided a broad
picture of GACs' progress toward seismic compliance, there was
insufficient information to develop a detailed status report on
compliance, as well as to assess the impact of the deadlines on
GAC services and capacity. The next report is due November 1,
2010.
This bill contains two additional reporting requirements for
GACs working to meet the 2030 deadline, mandating them to begin
reporting their status and progress toward the deadline in 2016.
Besides identifying which SPC-1 buildings will be retrofitted,
replaced, or removed from acute care service, the reports will
provide such building-specific information as planned SPC
levels, applicable deadlines, project status, and current and
planned inpatient beds and services. The reports will also show
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the final configuration of all buildings on a GAC campus, as
well as net changes in a GAC's overall inpatient capacity if
buildings are to be removed from acute care service.
This bill will require an entity purchasing a GAC that does not
meet the seismic mandate at the time of purchase to submit a
report on how they plan to meet the mandate, including
information relating to their financial capacity to build to the
required standard.
This bill and SB 608 (Alquist) both amend the same code
sections. Language has been included in this bill to avoid
chaptering-out the other, should both bills be enacted.
Analysis Prepared by : Tanya Robinson-Taylor / HEALTH / (916)
319-2097
FN: 0006776