BILL ANALYSIS �
SB 14
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Date of Hearing: July 14, 2011
ASSEMBLY COMMITTEE ON BUDGET
Bob Blumenfield, Chair
SB 14 (Wolk, DeSaulnier, and Huff) - As Amended: May 19, 2011
SENATE VOTE : 38-0
SUBJECT : State Budget
SUMMARY : Creates a performance-based budget process and a
program evaluation legislative process. Specifically, this
bill:
1)Requires, by 2014-15, the Governor to include the following
information in the January budget:
a) The mission and goals of each agency;
b) The activities and programs of the agency;
c) Performance measures that reflect the desired outcomes
of the agency and a targeted performance level of the
following year;
d) Prior-year performance data; and,
e) A description of the impacts to current beneficiaries of
a program proposed for modification or elimination.
2)Implements the new performance-based budgeting requirements
subject to appropriation in the budget, but requires the
Department of Finance to prepare a plan that expects one-third
of all state expenditures will use performance-based budgeting
in the 2012-13 budget process.
3)Requires the Department of Finance to develop an implementation
plan, guidelines for developing performance measures used in
performance-based budgeting, and training programs for state
employees. A task force, consisting of the Director of
Finance, the Controller, and the chairs and vice chairs of
budget committees in both houses would review and comment on
the Department of Finance's plan, guidelines, and training
program.
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4)Requires the Legislature to designate a committee to adopt a
process and timeline for a performance review of all state
programs at least once every ten years. Stipulates that
one-third of all General Fund expenditures must be reviewed by
July 1, 2015 and two-thirds of all General Fund expenditures
must be reviewed by January 1, 2018.
EXISTING LAW : Article IV, Section 12 of California's
Constitution requires the Governor to submit a balanced budget
to the Legislature by January 10th of each year. Government Code
Section 13308 requires the submission of the budget trailer bill
language by February 1st of each year.
FISCAL EFFECT : Likely costs starting in the tens of millions
associated with additional workload on the part of the
Department of Finance, agencies, and departments to prepare the
required information in the shortened timeframes provided for in
the bill.
COMMENTS :
The bill establishes a performance-based budgeting process over
a three-year timeframe. Subject to appropriation in the budget,
one-third of the budget would be expected to be
performance-based in 2012-13, which would be only ten days after
the measure would actually take effect if enacted.
Additionally, these activities are subject to appropriation in
the budget for implementation. Full implementation is
envisioned by 2014-15.
Significant issues are raised by this bill and are outlined
below:
1)Aggressive Timeline. This timeline is likely too aggressive
for the full implementation of a statewide effort of
performance measures.
a) In 1993, the State attempted to pilot performance-based
budgeting in three departments; this effort was deemed
unsuccessful and was discontinued in 1999.
b) The aggressive timeline may also result in increased
costs that could be avoided if implementation could
leverage resources with other initiatives, in particular
the development and implementation of the Fi$Cal state
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accounting and budgeting system that will roll out over the
next ten years.
1)Task Force Duties. This bill creates an implementation task
force of the Director of Finance, the Controller, and the
Chairs and Vice-Chairs of both budget committees to review the
DOF plan for implementation, guidelines for development of
performance measures, and training needs associated with
implementing this bill.
a) Given the other time commitments of the members of this
task force, it is hard to see how this group could meet
often enough to offer substantial guidance and feedback on
all of these important implementation issues.
1)Development of Performance Measures. This bill requires that
the performance measures associated with performance based
budget must be submitted with the main budget submission on
January 10th of each year.
a) This provision adds workload to Department of Finance,
agencies, and departments during the peak work months,
which means increased staff are likely needed to implement
the measures on this timetable. However, the author
believes this is needed to ensure that there is a linkage
between performance measures and Jan 10 budget.
1)Program Evaluation. This bill mandates that the Legislature
designate a policy committee to conduct a program evaluation
review of all state programs under specific timelines and
using a set of criteria stipulated in the bill.
a) If this section were to be enacted, it would create a
potential separation of powers issue because the
Legislature could not alter its own process for conducting
program evaluation without a governor's signature on
subsequent legislation.
b) In addition, these components of the bill raise
significant process and policy questions over how policy
committees would review proposed legislation to change or
terminate programs and how these decisions would reconcile
and return to the budgeting process.
REGISTERED SUPPORT / OPPOSITION :
SB 14
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Support
State Controller John Chiang (co-source)
California Forward (co-source)
AARP
American Association of University Women
American Council of Engineering Companies of California
American Federation of State, County and Municipal Employees
Bay Area Council
Business Council of San Joaquin County
Brocade Communications Systems, Inc.
California Alliance of Child and Family Services
California Association of Bed & Breakfast Inns
California Chamber of Commerce
California Chapter of the American Fence Association
California Church IMPACT
California Construction and Industrial Materials Association
California Fence Contractors' Association
California Grocers Association
California Hotel & Lodging Association
California Independent Oil Makers Association
California Manufactures & technology Association
California Partnership for the San Joaquin Valley
California Retailers Association
California Senior Advocates League
California State Student Association
California Taxpayers Association
Consumer Specialty Products Association
Contra Costa Council
Engineering Contractors' Association
Flasher Barricade Association
Fresno Business Council
Greater Fresno Area Chamber of Commerce
Greenlining Institute
Half Moon Bay Coastside Chamber of Commerce
Herbalife International of America, Inc.
Huntington Beach Chamber of Commerce
Kern County Taxpayers Association
Los Angeles Area Chamber of Commerce
Marin Builders' Association
MoSys Inc.
Proofpoint Systems Inc.
San Francisco Chamber of Commerce
San Gabriel Valley Economic Partnership
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San Mateo County Economic Development Association
Santa Clara and San Benito Counties Building and Construction
Trades Council
Santa Cruz County Medical Society
Saving California Communities
Service Employees International Union
State Building and Construction Trades Council of California
Silicon Valley Leadership Group
TechAmerica
USANA Health Sciences, Inc.
Valley Industry and Commerce Association
WELL Network
Opposition
None on file.
Analysis Prepared by : Christian Griffith / BUDGET / (916)
319-2099