BILL ANALYSIS �
SENATE COMMITTEE ON BUDGET AND FISCAL REVIEW
Mark Leno, Chair
Bill No: AB 1466
Author: Committee on Budget
As Amended: June 26, 2012
Consultants: Brady Van Engelen, Kris Kuzmich, Mark Ibele,
Keely Bosler Martin
Fiscal: Yes
Hearing Date: June 26, 2012
Subject: Budget Act of 2012: General Government Omnibus
Trailer Bill
Summary: This measure makes various statutory changes
necessary to implement the general government-related
provisions of the Budget Act of 2012.
Proposed Law: This bill includes the following provisions:
1. National Mortgage Settlement Proceeds. Creates a
deposit fund for the receipt of certain direct
payments from the National Mortgage Settlement.
Allows the Director of Finance, in accordance with
legislative intent, to offset GF expenditures during
the 2011-12, 2012-13, and 2012-14 fiscal years.
2. Deletes Requirement for State Controller to perform
review of Airport Fee Audits. Deletes the requirement
for the State Controller to review independent audits
necessary to collect specified fees related to rental
car companies and customer facilities. The independent
audits will still be a requirement prior to an airport
entity collecting the specified fee.
3. Oversight and Audit Responsibilities of the
Department of Finance. Ensures that the Department of
Finance retains its internal oversight audit
responsibilities.
4. Authorizes the Sale of CADA Properties. Authorizes
the Department of General Services to sell specified
parcels of property that are leased by the department
to the Capital Area Development Authority. The
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proceeds of the sale would be deposited into the
General Fund or the Deficit Recovery Fund.
5. DNA Penalty Assessment. Increases the amount of
state-only penalty to $4 for every $10, or part of $10
of those payments for specified criminal offenses.
Funds are utilized to fund the operations of the
Department of Justice forensic laboratories.
6. Proposition 1B Transit and Waterborne Programs.
Enhances oversight responsibilities of the disposition
of Proposition 1B related funds by the California
Emergency Management Agency and allow for CalEMA to
take into account when funding projects the ability of
a project to expend funds within a specified
timeframe.
7. Technology Agency Project Oversight. Enables the
California Technology Agency to develop and apply
uniform criteria on high risk projects in order to
reduce project risk and the potential for cost
increases.
8. CVSO Funding and Review. Revises the formula
utilized by the Department of Veterans Affairs to
ensure that a more qualitative rather than
quantitative measure is utilized to disburse funds to
support County Veteran Service Officer (CVSO) related
operations.
9. Negotiated Process for the California Technology
Agency. Allows the California Technology Agency to
utilize a negotiated process on information technology
related procurement contracts if certain criteria are
met.
10. University of California Capital Outlay Interim
Financing Costs Reimbursement by the Public Works
Board. Authorizes the Public Works Board (PWB) to
provide repayment from state bond proceeds to UC for
the interim financing costs of capital outlay projects
that have been approved by the Legislature. Under
current law, reimbursement is limited to only the
principal amount financed. With this change, UC would
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be able to provide interim financing for the list of
projects that have been approved by the Legislature,
but for which bonds have not been sold, thereby
allowing these projects to move forward.
11. Employment Development Department: Automated
Collection Enhancement System Technical Statutory
Clean-up. Provides for the necessary "clean-up" to
remove from statute the Franchise Tax Board's
authority to collect delinquent accounts for the
Department of Industrial Relations (DIR). This
statutory authority is no longer needed; as of January
31, 2012, the Employment Development Department's
Automated Collection Enhancement System is collecting
all delinquent accounts for DIR.
12. Reduction for Employee Compensation. As required
by a memorandum of understanding or by direction of
the California Department of Human Resources (CalHR)
for excluded employees, specifies state employees
shall participate in the Personal Leave Program 2012
(PLP 2012) for the period from July 1, 2012, to June
30, 2012. Under the provisions of this bill, an
employee participating in the PLP 2012 shall receive a
reduction in pay not greater than five percent and, in
exchange, receive eight hours of PLP 2012 leave
credits on the first day of each monthly pay period.
For those state employees not subject to the PLP 2012,
requires CalHR to adopt a plan to furlough those
employees one workday per calendar month for the
period July 1, 2012, to June 30, 2013. Requires that
reductions for employee compensation for the period
from July 1, 2012, to June 30, 2013, apply to
employees of the State Compensation Insurance Fund.
These statutory changes further implement Control
Section 3.90 of the Budget Act of 2012, which achieves
employee compensation-related savings of $402 million
General Fund.
13. Administrative Costs for Financial Information
System for California. Modifies the definition of
administrative costs to include amounts expended by
the Financial Information System for California
(FI$Cal). Administrative costs are defined as amounts
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required for supervision and administration of state
government for services to state agencies. Existing
law requires the Department of Finance to determine,
and the Controller to notify, a state agency of the
amount deemed to be the fair share of administrative
costs due and payable from each state agency.
14. Credit Enhancement Fees. Deletes the sunset date
for language that places a 3-percent cap on amounts
appropriated for fees, costs, and other similar
expenses incurred in connection with any credit
enhancement or liquidity agreement on bonds payable
from the State's General Fund. After the June 30,
2013 sunset, the cap will fall to 2 percent. The cap
was temporarily raised to 3 percent in budget
legislation adopted in 2009. Market conditions could
necessitate retention of the 3-percent cap and allow
flexible overall terms possible for State borrowing.
15. Repeal of the Filipino Employee Survey Mandate.
Repeals the Filipino Employee Survey Mandate, a state
mandate that had been suspended since 1990.
16. Financial Information Systems for California.
Improves annual legislative reporting requirements for
the (FI$Cal), including benefits from the project that
were achieved during the reporting period, and updates
on the progress of meeting specific project
objectives.
17. Capital Investment Incentive Program. Expands the
ability of a city, county, or a city and a county to
pay an investment incentive, to include qualified
research and development facilities until July 1,
2013. Capital investment incentives are amounts up to
the amount of ad valorem property taxes paid by the
qualified research and development facility, less 25
percent.
18. Mandate Suspensions. Specifies that local
government mandates suspended in the 2012-13 Budget
Act shall also be suspended in 2013-14 and 2014-15,
and there shall be no appropriation for payment of
reimbursement claims submitted for fiscal years
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2012-13, 2013-14 and 2014-15.
19. Excise Tax Sunset Elimination. Removes the sunset
date from the shift to the General Fund of excise
taxes on gasoline purchased for certain uses, thus
allowing the shift of these excise tax revenues to
flow to the General Fund indefinitely.
20. ALRB General Counsel Allocation. Shifted funding
from the Board Administration budget item to the
General Counsel Administration budget item within the
Agricultural Labor Relations Board. This shift is
cost neutral to the General Fund and is necessary to
help the General Counsel oversee union representation
elections among farmworkers.
Fiscal Effect: Creates a special deposit fund that will
allow the state to use $410.6 million from the National
Mortgage Settlement to offset General Fund costs, allows
for the sale of state property that can be deposited into
the General Fund, and helps provide for a balanced budget
in future years by removing the sunset date regarding
excise taxes on gasoline purchased for specific uses and
extending a suspension of local mandates.
Comments: This bill enacts various provisions to support
the 2012 Budget Act, and among other things, improves
oversight of state technology procurement, enacts changes
to help bring more federal benefits to veterans, and makes
changes to allow for a structurally-balanced budget for the
next four years.
Support: Unknown
Opposed: Unknown
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