BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 2115
                                                                  Page  1

          Date of Hearing:   May 2, 2012

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                    AB 2115 (Alejo) - As Amended:  April 10, 2012 

          Policy Committee:                              Local 
          GovernmentVote:9-0

          Urgency:     No                   State Mandated Local Program: 
          Yes    Reimbursable: Yes          

           SUMMARY  

          This bill requires a local hospital district, if employing a 
          hospital administrator, to enter into a written contract of 
          employment with the administrator.  

           FISCAL EFFECT  

          Negligible.  The bill provides for reimbursement to local 
          agencies if the Commission on State Mandates determines there 
          are mandated costs, however, there are not likely to be any such 
          costs.

           COMMENTS  

           1)Purpose.   According to the author, this bill will result in 
            clarity, transparency and accountability in terms of 
            employment and compensation.  The author notes that due to the 
            lack of a written contract for the former CEO of the Salinas 
            Valley Memorial Health Care System, board members were unclear 
            about the former CEO's total compensation.

           2)Background.   Under the Local Hospital District Law, special 
            districts are authorized to build and operate community 
            hospitals and other health care facilities in underserved 
            areas.  The Salinas Valley Memorial Healthcare System was 
            founded under the provisions of this law.  The district is 
            governed by an elected 5-member board of directors.

           3)Recent audit.   This bill stems from the recent Bureau of State 
            Audits examination on the Salinas Valley Memorial Health Care 
            System.  Released in March 2012, the audit report found the 








                                                                  AB 2115
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            district violated the open meeting laws when discussing 
            executive compensation.  Among its other findings were that it 
            was unclear the compensation paid to the former chief 
            executive because of the lack of a written employment 
            contract.  

           4)There is no registered opposition to this bill.  


           Analysis Prepared by  :    Roger Dunstan / APPR. / (916) 319-2081