BILL NUMBER: AB 272	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JANUARY 13, 2012
	AMENDED IN SENATE  JANUARY 4, 2012
	AMENDED IN SENATE  AUGUST 30, 2011
	AMENDED IN ASSEMBLY  MARCH 7, 2011

INTRODUCED BY   Assembly Member Monning

                        FEBRUARY 7, 2011

   An act to amend Section 15438 of, and to add Section 15438.10 to,
the Government Code, relating to health facilities financing, making
an appropriation therefor, and declaring the urgency thereof, to take
effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 272, as amended, Monning. Health care facilities: financing.
   The California Health Facilities Financing Authority Act
authorizes the California Health Facilities Financing Authority to
make loans from the continuously appropriated California Health
Facilities Financing Authority Fund to participating health
institutions for financing or refinancing the acquisition,
construction, or remodeling of health facilities. The act defines a
health facility to include various specified facilities and
facilities operated in conjunction with these facilities. It also
defines a participating health institution to mean specified entities
authorized by state law to provide or operate a health facility and
undertake the financing or refinancing of the construction or
acquisition of a project or of working capital, as defined.
   Existing law authorizes the authority to award grants to any
eligible health facility, as defined, for purposes of financing
defined projects.
   This bill would authorize the authority to award one or more
grants that, in the aggregate, do not exceed $1,500,000 to one or
more projects designed to demonstrate new or enhanced cost-effective
methods of delivering health care services, as specified. This bill
would authorize the authority to award additional grants that, in the
aggregate, do not exceed $5,000,000 to eligible recipients, as
defined by the authority, to replicate the model developed by a
project, if specified conditions are met, and would authorize the
authority to adopt regulations relating to this grant program as
emergency regulations. This bill would create the California Health
Access Model Program Account in the California Health Facilities
Financing Authority Fund, and would transfer up to $6,500,000 from
the fund to the account for the purposes of the bill. The bill would
require that any moneys remaining in the account as of January 1,
2020, revert to the fund. By expanding the purposes for which a
continuously appropriated fund may be used, this bill would make an
appropriation.
   This bill would declare that it is to take effect immediately as
an urgency statute.
   Vote: 2/3. Appropriation: yes. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 15438 of the Government Code is amended to
read:
   15438.  The authority may do any of the following:
   (a) Adopt bylaws for the regulation of its affairs and the conduct
of its business.
   (b) Adopt an official seal.
   (c) Sue and be sued in its own name.
   (d) Receive and accept from any agency of the United States, any
agency of the state, or any municipality, county, or other political
subdivision thereof, or from any individual, association, or
corporation gifts, grants, or donations of moneys for achieving any
of the purposes of this chapter.
   (e) Engage the services of private consultants to render
professional and technical assistance and advice in carrying out the
purposes of this part.
   (f) Determine the location and character of any project to be
financed under this part, and to acquire, construct, enlarge,
remodel, renovate, alter, improve, furnish, equip, fund, finance,
own, maintain, manage, repair, operate, lease as lessee or lessor,
and regulate the same, to enter into contracts for any or all of
those purposes, to enter into contracts for the management and
operation of a project or other health facilities owned by the
authority, and to designate a participating health institution as its
agent to determine the location and character of a project
undertaken by that participating health institution under this
chapter and as the agent of the authority, to acquire, construct,
enlarge, remodel, renovate, alter, improve, furnish, equip, own,
maintain, manage, repair, operate, lease as lessee or lessor, and
regulate the same, and as the agent of the authority, to enter into
contracts for any or all of those purposes, including contracts for
the management and operation of that project or other health
facilities owned by the authority.
   (g) Acquire, directly or by and through a participating health
institution as its agent, by purchase solely from funds provided
under the authority of this part, or by gift or devise, and to sell,
by installment sale or otherwise, any lands, structures, real or
personal property, rights, rights-of-way, franchises, easements, and
other interests in lands, including lands lying under water and
riparian rights, that are located within the state that the authority
determines necessary or convenient for the acquisition,
construction, or financing of a health facility or the acquisition,
construction, financing, or operation of a project, upon the terms
and at the prices considered by the authority to be reasonable and
that can be agreed upon between the authority and the owner thereof,
and to take title thereto in the name of the authority or in the name
of a participating health institution as its agent.
   (h) Receive and accept from any source loans, contributions, or
grants for, or in aid of, the construction, financing, or refinancing
of a project or any portion of a project in money, property, labor,
or other things of value.
   (i) Make secured or unsecured loans to, or purchase secured or
unsecured loans of, any participating health institution in
connection with the financing of a project or working capital in
accordance with an agreement between the authority and the
participating health institution. However, no loan to finance a
project shall exceed the total cost of the project, as determined by
the participating health institution and approved by the authority.
Funds for secured loans may be provided from the California Health
Facilities Financing  Authority  Fund pursuant to
subdivision (b) of Section 15439 to small or rural health facilities
pursuant to authority guidelines.
   (j) (1) Make secured or unsecured loans to, or purchase secured or
unsecured loans of, any participating health institution in
accordance with an agreement between the authority and the
participating health institution to refinance indebtedness incurred
by that participating health institution or a participating health
institution that controls or manages, is controlled or managed by, is
under common control or management with, or is affiliated with that
participating health institution, in connection with projects
undertaken or for health facilities acquired or for working capital.
   (2) Make secured or unsecured loans to, or purchase secured or
unsecured loans of, any participating health institution in
accordance with an agreement between the authority and the
participating health institution to refinance indebtedness incurred
by that participating health institution or a participating health
institution that controls or manages, is controlled or managed by, is
under common control or management with, or is affiliated with that
participating health institution, payable to the authority or
assigned or pledged to authority issued bonds.
   (3) Funds for secured loans may be provided from the California
Health Facilities Financing  Authority  Fund pursuant to
subdivision (b) of Section 15439 to small or rural health facilities
pursuant to authority guidelines.
   (k) Mortgage all or any portion of interest of the authority in a
project or other health facilities and the property on which that
project or other health facilities are located, whether owned or
thereafter acquired, including the granting of a security interest in
any property, tangible or intangible, and to assign or pledge all or
any portion of the interests of the authority in mortgages, deeds of
trust, indentures of mortgage or trust, or similar instruments,
notes, and security interests in property, tangible or intangible, of
participating health institutions to which the authority has made
loans, and the revenues therefrom, including payments or income from
any thereof owned or held by the authority, for the benefit of the
holders of bonds issued to finance the project or health facilities
or issued to refund or refinance outstanding indebtedness of
participating health institutions as permitted by this part.
   (l) Lease to a participating health institution the project being
financed or other health facilities conveyed to the authority in
connection with that financing, upon the terms and conditions the
authority determines proper, charge and collect rents therefor,
terminate the lease upon the failure of the lessee to comply with any
of the obligations of the lease, and include in that lease, if
desired, provisions granting the lessee options to renew the term of
the lease for the period or periods and at the rent, as determined by
the authority, purchase any or all of the health facilities or that
upon payment of all of the indebtedness incurred by the authority for
the financing of that project or health facilities or for refunding
outstanding indebtedness of a participating health institution, then
the authority may convey any or all of the project or the other
health facilities to the lessee or lessees thereof with or without
consideration.
   (m) Charge and equitably apportion among participating health
institutions, the administrative costs and expenses incurred by the
authority in the exercise of the powers and duties conferred by this
part.
   (n) Obtain, or aid in obtaining, from any department or agency of
the United States or of the state, any private company, or any
insurance or guarantee as to, of, or for the payment or repayment of,
interest or principal, or both, or any part thereof, on any loan,
lease, or obligation, or any instrument evidencing or securing the
loan, lease, or obligation, made or entered into pursuant to this
part; and notwithstanding any other provisions of this part, to enter
into any agreement, contract, or any other instrument whatsoever
with respect to that insurance or guarantee, to accept payment in the
manner and form as provided therein in the event of default by a
participating health institution, and to assign that insurance or
guarantee as security for the authority's bonds.
   (o) Enter into any and all agreements or contracts, including
agreements for liquidity or credit enhancement, bond exchange
agreements, interest rate swaps or hedges, execute any and all
instruments, and do and perform any and all acts or things necessary,
convenient, or desirable for the purposes of the authority or to
carry out any power expressly granted by this part.
   (p) Invest any moneys held in reserve or sinking funds or any
moneys not required for immediate use or disbursement, at the
discretion of the authority, in any obligations authorized by the
resolution authorizing the issuance of the bonds secured thereof or
authorized by law for the investment of trust funds in the custody of
the Treasurer.
   (q) Award grants to any eligible clinic pursuant to Section
15438.6.
   (r) Award grants to any eligible health facility pursuant to
Section 15438.7.
   (s) (1) Notwithstanding any other provision of law, provide a
working capital loan of up to five million dollars ($5,000,000) to
assist in the establishment and operation of the California Health
Benefit Exchange (Exchange) established under Section 100500. The
authority may require any information it deems necessary and prudent
prior to providing a loan to the Exchange and may require any term,
condition, security, or repayment provision it deems necessary in the
event the authority chooses to provide a loan. Under no
circumstances shall the authority be required to provide a loan to
the Exchange.
   (2) Prior to the authority providing a loan to the Exchange, a
majority of the board of the Exchange shall be appointed and shall
demonstrate, to the satisfaction of the authority, that the federal
planning and establishment grants made available to the Exchange by
the United States Secretary of Health and Human Services are
insufficient or will not be released in a timely manner to allow the
Exchange to meet the necessary requirements of the federal Patient
Protection and Affordable Care Act (Public Law 111-148).
   (3) The Exchange shall repay a loan made under this subdivision no
later than June 30, 2016, and shall pay interest at the rate paid on
moneys in the Pooled Money Investment Account.
   (t) Award grants pursuant to Section 15438.10.
  SEC. 2.  Section 15438.10 is added to the Government Code, to read:

   15438.10.  (a) The Legislature finds and declares the following:
   (1) Many Californians face serious obstacles in obtaining needed
health care services, including, but not limited to, medical, mental
health, and dental services. The obstacles faced by vulnerable
populations and communities include existence of complex medical,
physical, or social conditions, disabilities, economic disadvantage,
and living in remote or underserved areas that make it difficult to
access services.
   (2) With the recent passage of national health care reform, there
is an increased demand for innovative ways to deliver health care to
individuals in a cost-effective manner.
   (3) Technological innovation continues to create opportunities for
developing new methods of delivering needed services to vulnerable
populations and communities cost-effectively and with improved health
outcomes.
   (4) There is a need to develop new methods of delivering health
services utilizing innovative models that can be demonstrated to be
effective and then replicated throughout California and that bring
community-based health care to individuals where they live or receive
education, social, or general health services.
   (5) For more than 30 years, the California Health Facilities
Financing Authority has provided financial assistance through
tax-exempt bonds, low-interest loans, and grants to health facilities
in California, assisting in the expansion of the availability of
health services and health care facilities throughout the state.
   (b) (1) Following the completion of a competitive selection
process  that shall be exempt from the competitive bidding
requirements of Chapter 2 (commencing with Section 10290) of Part 2
of Division 2 of the Public Contract Code  , the authority
may award one or more grants that, in the aggregate, do not exceed
one million five hundred thousand dollars ($1,500,000) to one or more
projects designed to demonstrate specified new or enhanced
cost-effective methods of delivering health care services to improve
access to quality health care for vulnerable populations or
communities, or both, that are effective at enhancing health outcomes
and improving access to quality health care. These health care
services may include, but are not limited to, medical, mental health,
or dental services for the diagnosis, care, prevention, and
treatment of human illness, or individuals with physical, mental, or
developmental disabilities. More than one demonstration project may
receive a grant pursuant to this section. It is the intent of the
Legislature for a demonstration project that receives a grant to
allow patients to receive screenings, diagnosis, or treatment in
community settings, including, but not limited to, school-based
health centers, adult day care centers, and residential care
facilities for the elderly, or for individuals with mental illness or
developmental disabilities. It is also the intent of the Legislature
for a demonstration project that receives a grant to take advantage
of advances in telecommunications technologies that will produce a
more accessible and cost-effective delivery system for needed
services and improved health outcomes.
   (2) A grant awarded pursuant to this subdivision may be allocated
in increments to a demonstration project over multiple years to
ensure the demonstration project's ability to complete its work, as
determined by the authority. Prior to the initial allocation of funds
pursuant to this subdivision, the administrators of the
demonstration project shall provide evidence that the demonstration
project has or will have additional funds sufficient to ensure
completion of the demonstration project. If the authority allocates a
grant in increments, each subsequent year's allocation shall be
provided to the demonstration project only upon submission of
research that shows that the project is progressing  towards
  toward  the identification of a cost-effective
delivery model that improves health outcomes and access to quality
health care for vulnerable populations or communities, and can be
replicated throughout the state in community settings.
   (3)  A   Except for a health facility that
qualifies as a "small and rural hospital" pursuant to  
Section 124840 of the Health and Safety Code, a   
health facility that has received tax-exempt bond financing from the
authority shall not be eligible to receive funds awarded for a
demonstration project. Such a health facility may participate as an
uncompensated partner or member of a collaborative effort that is
awarded a demonstration project grant. 
   (4) Funds provided to a demonstration project pursuant to this
subdivision may be used to supplement, but not to supplant, existing
financial and resource commitments of the grantee or grantees or any
other member of a collaborative effort that has been awarded a
demonstration project grant. 
   (c) (1) If a demonstration project that receives a grant pursuant
to subdivision (b) is successful at developing a new method of
delivering cost-effective health care services in community settings
that result in increased access to quality health care or improved
health care outcomes, then, beginning as early as the second year
after the initial allocation of moneys provided pursuant to
subdivision (b), the authority may implement a second grant program
that awards not more than five million dollars ($5,000,000), in the
aggregate, to eligible recipients as defined by the authority, to
replicate in additional California communities the model developed by
a demonstration project that received a grant pursuant to
subdivision (b).  The award of these replication grants shall
be exempt from the competitive bidding requirements of Chapter 2
(commencing with Section 10290) of Part 2 of Division 2 of the Public
Contract Code.  Prior to the implementation of this second
grant program, the authority shall prepare and provide a report to
the Legislature and the Governor on the outcomes of the demonstration
project. The report shall be made in accordance with Section 9795.
   (2) If the authority implements the second grant program, the
authority shall also report annually, beginning with the first year
of implementation of the second grant program, to the Legislature and
the Governor regarding the program, including, but not limited to,
the total amount of grants issued pursuant to this subdivision, the
amount of each grant issued, and a description of each project
awarded funding for replication of the model.
   (3) Grants under this subdivision may be utilized for eligible
costs, as defined in subdivision (c) of Section 15432, including
equipment, information technology, and working capital, as defined in
subdivision (h) of Section 15432.
   (4) The authority may adopt regulations relating to the grant
program authorized pursuant to this subdivision, including
regulations that define eligible recipients, eligible costs, and
minimum and maximum grant amounts, as emergency regulations in
accordance with Chapter 3.5 (commencing with Section 11340) of Part
1. For purposes of Chapter 3.5 (commencing with Section 11340) of
Part 1, including Section 11349.6, the adoption of the regulations
shall be considered by the Office of Administrative Law to be
necessary for the immediate preservation of the public peace, health
and safety, and general welfare.
   (d) There is hereby created the California Health Access Model
Program Account in the California Health Facilities Financing
Authority Fund. All moneys in the account are hereby continuously
appropriated to the authority for carrying out the purposes of this
section. An amount of up to six million five hundred thousand dollars
($6,500,000) shall be transferred from funds in the California
Health Facilities Financing Authority Fund that are not impressed
with a trust for other purposes into the California Health Access
Model Program Account for the purpose of issuing grants pursuant to
this section. Any moneys remaining in the California Health Access
Model Program Account on January 1, 2020, shall revert as of that
date to the California Health Facilities Financing Authority Fund.
  SEC. 3.  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 assist underserved and vulnerable health care
populations at the earliest possible time, it is necessary that this
act take effect immediately.