BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
SB 1309 (Negrete McLeod) - Department of Human Resources
Amended: As Introduced Policy Vote: PE&R 4-0
Urgency: No Mandate: No
Hearing Date: April 30, 2012
Consultant: Maureen Ortiz
This bill does not meet the criteria for referral to the
Suspense File.
Bill Summary: SB 1309 makes statutory changes necessary to
implement the Governor's Reorganization Plan 1 (GRP 1) with
respect to the consolidation of the Department of Personnel
Administration (DPA) and the State Personnel Board (SPB) into a
single agency to be known as the California Department of Human
Resources (CalHR). Additionally, SB 1309 implements an auditing
program within CalHR to ensure compliance by departments with
the state's Merit Principle.
Fiscal Impact: Redirection of an existing 14 PYs to support the
new audit function as follows:
4 PYs in the Policy Unit in the amount of $442,000
(General)
10 PYs in the Audit Unit in the amount of $1.266 million
(Gen/Special, reimbursed from departments that are audited).
The Department of Finance has identified total savings of $8.6
million ($3.7 million General Fund) as a result of the
reorganization, mostly due to a 15% reduction in positions equal
to 60.5 PYs when the consolidation is complete. Most reductions
are expected to be achieved through vacancies and attrition over
the next few years. Additionally, fourteen existing positions
will be maintained to support the new audit function created in
this bill.
Background: GRP 1, effective July 1, 2012, merges the day-to-day
staff operations of the DPA and SPB organizations into a new,
consolidated agency, CalHR. The intent is to relocate the two
former departments into a single location by July 1, 2013. GRP
1 retains the independence and autonomy of the State Personnel
Board with regard to hearing matters related to the merit
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principle for state civil service employees, as required in the
Constitution.
The California Government Reorganization Process provides the
Governor with the authority to develop a reorganization of state
departments using executive order. After the language is
drafted by the Legislative Counsel Bureau it is submitted to the
Little Hoover Commission for review and recommendations. Thirty
days thereafter, the plan is submitted to the Legislature and
becomes effective 61 calendar days later unless the Legislature
passes a resolution disapproving the plan. Actual statutory
language to enact the reorganization is implemented the
following year, however the reorganization is effective even
without code language updates.
Merging the DPA and the SPB is not a new idea. In 1995, in its
report "Too Many Agencies, Too Many Rules: Reforming
California's Civil Service", the Little Hoover Commission made
recommendations to streamline and improve the state's personnel
functions. Also in 1995, in its "Analysis of the 1995-96 Budget
Bill: Reinventing the State Civil Service", the Legislative
Analyst's Office recommended that the Legislature begin the
reinvention of the state civil service system. And, in 1997 the
California Research Bureau stated "the Department of Personnel
Administration and the State Personnel Board have overlapping
responsibilities". All of these reports have recommended the
consolidation of the two entities.
The Department of Personnel Administration was created in 1981
and is responsible for all matters concerning state
employer-employee relations related to salaries, benefits, and
position classification. The DPA represents the Governor in
collective bargaining with unions representing rank and file
state employees.
The State Personnel Board with five members appointed by the
Governor for ten-year terms was established in the California
Constitution in 1934. The SPB is responsible for administering
the state's civil service system and ensures that employment
decisions are based on merit. SPB provides a variety of
recruitment, selection, classification, appellate, goal setting,
training, and consultation services to state departments and
local agencies.
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The Governor's Reorganization Plan 1 proposes to improve the
human resources program by establishing a more formal delegation
system for personnel offices of line agencies by setting
standards for implementing "best practices", ensuring proper
position allocations to classifications, ensuring the proper
administration of salary, pay rules, overtime, and other working
condition issues; as well as establishing auditing and reporting
requirements.
Proposed Law: Aside from updating numerous Government Code
sections to properly reflect the name of the newly created
department, establishing the Department of Human Resources in
Government Code Section 18502, and making other conforming
statutory changes for implementation of GRP 1, SB 1309 will
establish a new auditing program at CalHR to ensure compliance
with the state civil service laws and board regulations.
Specifically, SB 1309 does the following:
a) Requires the board to establish rules implementing and
enforcing the merit principle in the state civil service
system.
b) Allows the board to conduct an audit of any appointing
authority's personnel practices including selection and
examination procedures, appointments, promotions, the
management of probationary periods, personal service
contracts, discipline and adverse actions, and any other
component of the merit principle.
c) Authorizes the board to inspect documents, policies,
practices, and procedures of the appointing authority when
conducting an audit, and to interview staff and witnesses.
d) Authorizes the board to provide a report to the
department upon completion of the audit identifying any
deficiencies it finds.
SB 1309 authorizes the board to use any of the following
remedies when determining an appointment authority is subject to
corrective action:
a) Revocation or modification of the terms of the
delegation agreement between the appointing authority and
the department.
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b) Require the appointing authority to compensate the
department for the actual and necessary costs of any and
all personnel functions the department performs, as
specified.
c) Void examinations, abolish eligibility lists and void
appointments.
d) Seek approval from the Department of Finance for
redirection of positions from the appointing authority to
the department to perform all personnel related functions
formerly performed by the appointing authority.
SB 1309 authorizes the board to recover from an audited
department the entire cost of any audit or investigation it
conducts.
Related Legislation: A companion measure, SB 1308 (Negrete
McLeod) 2012, makes numerous statutory changes necessary to
implement the GRP 1. That measure is currently pending in the
Assembly.
Staff Comments: Through the GRP 1, line agencies will be given
more control over all aspects of Human Resources at their
respective departments, however, in order to ensure the
Constitutional mandate to preserve the merit principle in state
government, a fair and robust audit program is necessary.
The audit function will not require any new funding or PYs since
an existing 14 positions that now are used for constructing,
validating, and administering civil service exams; conducting
psychological and medical screenings; authorizing and voiding
appointments; and preparing the bilingual services and annual
census reports will instead be responsible for developing policy
guidance for departments on test validation and construction,
and performing audits to ensure that they are in compliance with
board policy.
As in past practice, General Fund positions are used to staff
policy functions, whereas reimbursable positions are used for
audit activities. In essence, all 14 positions are existing
positions that are being redirected to perform merit-related
functions in a different way.
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