BILL ANALYSIS �
SB 112
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Date of Hearing: July 6, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 112 (Liu) - As Amended: March 7, 2011
Policy Committee: Local
GovernmentVote:9-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill amends claims processing procedures for reimbursement
for state mandated local programs. Specifically this bill:
1)Extends the State Controller's time limit to issue claiming
instructions for local agencies and school districts from 60
days to 90 days after receiving notice from the Commission on
State Mandates or Department of Finance.
2)Extends the controller's time limit to issue amended claiming
instructions from 60 days to 90 days after receiving
information that requires the amendment, notice from the
Commission on State Mandates or notice of action by the
Legislature.
3)Requires that any request to amend the parameters and
guidelines of the Commission on State Mandates (COSM), if it
does not increase or decrease the reimbursable costs, shall
limit the filing period to the fiscal year in which the
amended parameters and guidelines were adopted rather than the
fiscal year in which the amendments were proposed.
FISCAL EFFECT
Minor and absorbable costs to the controller to implement the
bill's provisions. These may ultimately reduce costs for
claiming and paying mandates by eliminating inefficiencies.
COMMENTS
1)Purpose of the bill . The author states that this bill will
SB 112
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help reform K-12 education mandates. The author points to the
work of Legislative Analyst's Office, which has called the
K-12 education mandate program, in particular, a broken
system. SB 112 increases the time allowed the controller to
issue claiming instructions. The 30-day extension gives the
controller more time to program e-filing reports, research the
claim, write thorough claiming instructions, and receive
public comments from state agencies and interested parties.
In response to the 37 programs whose parameters and guidelines
have been amended, which would allow local governments to
retroactively submit claims for unclaimed expenses, SB 112
tightens the definition of boilerplate language to prevent
claimants from claiming costs incurred in previous fiscal
years. SB 112 will not allow claimants to file new claims
after the deadline has passed or to amend old claims to
increase costs when the parameters and guidelines were used to
update boilerplate language.
2)Background . In 1979, voters amended the California
Constitution, requiring the state to reimburse local agencies
for the costs of new state mandated local programs or higher
levels of service. In 1984, the Legislature created the COSM,
a quasi-judicial body that decides local agencies' test claims
for reimbursement. If the commission identifies a
state-mandated program from the test claim, the commission
adopts parameters and guidelines, defines what activities will
be reimbursed, and adopts statewide cost estimates.
3)Mandate reimbursement process . The COSM is working through a
backlog of 242 test claims; some date from 2002. The mandate
process is lengthy and complex, has been subject to criticism,
and has led to disputes.
In 2010, the Clovis Unified School District won its court
appeal against the State Controller, who had reduced
reimbursement claims for four state-mandated programs using a
definition of source documents that was not in effect during
the audit period. The district argued that the controller
could not apply the current definition of source documents for
the years 1998 to 2003.
Before the Clovis case, the Controller requested amendments to
the COSM's parameters and guidelines to update the
boilerplate language. These changes affected 37 programs: 21
locals, 12 school districts mandates, and four community
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colleges. Currently, if any part of the parameters and
guidelines are amended, the filing period for reimbursement
claims re-opens. Any local government can claim
reimbursements for previously unclaimed expenses. Local
government that may have forgotten to file reimbursement
claims for any previous fiscal year can file claims for costs
incurred for previous years.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081