Amended in Senate August 22, 2014

Amended in Senate August 21, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 2557

Introduced by Assembly Member Pan

(Principal coauthors: Assembly Members Campos and Williams)

(Coauthor: Assembly Member Dickinson)

(Coauthors: Senators Beall, Hill, and Steinberg)

February 21, 2014

An act to amend Section 130060 of the Health and Safety Code, relating to health begin delete facilities. end delete begin insert facilities, and declaring the urgency thereof, to take effect immediately. end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 2557, as amended, Pan. Hospitals: seismic safety.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973.

Existing law requires that, after January 1, 2008, any general acute care hospital building that is determined to be a potential risk of collapse or pose significant loss of life be used only for nonacute care hospital purposes, except that the office may grant a 5-year extension under prescribed circumstances. Existing law also allows the office to grant an additional 2-year extension in specified circumstances.

This bill would clarify that a general acute care hospital building described above may be used for purposes other than nonacute care hospital purposes if an extension of the January 1, 2008, deadline has been granted and, before the end of the extension, a replacement building has been constructed or a retrofit has been performed, as specified. The bill would authorize a hospital located in the County of Sacramento, San Mateo, or Santa Barbara or the City of San Jose that has received the additional 2-year extension to the January 2008 deadline pursuant to specified provisions to request an additional extension until September 1, 2015, to obtain either a certificate of occupancy for a replacement building or a construction final for a building on which a retrofit has been performed.

This bill would make legislative findings and declarations as to the necessity of a special statute for the Counties of Sacramento, San Mateo, and Santa Barbara and the City of San Jose.

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This bill would declare that it is to take effect immediately as an urgency statute.

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Vote:  begin delete majority end delete begin insert ²⁄₃ end insert . Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 130060 of the Health and Safety Code
is amended to read:

130060.  

(a) (1) After January 1, 2008, any general acute care
hospital building that is determined to be a potential risk of collapse
or pose significant loss of life shall only be used for nonacute care
hospital purposes, unless an extension of this deadline has been
granted and either of the following occurs before the end of the
extension:

(A) A replacement building has been constructed and a
certificate of occupancy has been granted by the office for the
replacement building.

(B) A retrofit has been performed on the building and a
construction final has been obtained by the office.

(2) An extension of the deadline may be granted by the office
upon a demonstration by the owner that compliance will result in
a loss of health care capacity that may not be provided by other
general acute care hospitals within a reasonable proximity. In its
request for an extension of the deadline, a hospital shall state why
the hospital is unable to comply with the January 1, 2008, deadline
requirement.

(3) Prior to granting an extension of the January 1, 2008,
deadline pursuant to this section, the office shall do all of the
following:

(A) Provide public notice of a hospital’s request for an extension
of the deadline. The notice, at a minimum, shall be posted on the
office’s Internet Web site, and shall include the facility’s name
and identification number, the status of the request, and the
beginning and ending dates of the comment period, and shall advise
the public of the opportunity to submit public comments pursuant
to subparagraph (C). The office shall also provide notice of all
requests for the deadline extension directly to interested parties
upon request of the interested parties.

(B) Provide copies of extension requests to interested parties
within 10 working days to allow interested parties to review and
provide comment within the 45-day comment period. The copies
shall include those records that are available to the public pursuant
to the California Public Records Act (Chapter 3.5 (commencing
with Section 6250) of Division 7 of Title 1 of the Government
Code).

(C) Allow the public to submit written comments on the
extension proposal for a period of not less than 45 days from the
date of the public notice.

(b) (1) It is the intent of the Legislature, in enacting this
subdivision, to facilitate the process of having more hospital
buildings in substantial compliance with this chapter and to take
nonconforming general acute care hospital inpatient buildings out
of service more quickly.

(2) The functional contiguous grouping of hospital buildings of
a general acute care hospital, each of which provides, as the
primary source, one or more of the hospital’s eight basic services
as specified in subdivision (a) of Section 1250, may receive a
five-year extension of the January 1, 2008, deadline specified in
subdivision (a) of this section pursuant to this subdivision for both
structural and nonstructural requirements. A functional contiguous
grouping refers to buildings containing one or more basic hospital
services that are either attached or connected in a way that is
acceptable to the State Department of Health Care Services. These
buildings may be either on the existing site or a new site.

(3) To receive the five-year extension, a single building
containing all of the basic services or at least one building within
the contiguous grouping of hospital buildings shall have obtained
a building permit prior to 1973 and this building shall be evaluated
and classified as a nonconforming, Structural Performance
Category-1 (SPC-1) building. The classification shall be submitted
to and accepted by the Office of Statewide Health Planning and
Development. The identified hospital building shall be exempt
from the requirement in subdivision (a) until January 1, 2013, if
the hospital agrees that the basic service or services that were
provided in that building shall be provided, on or before January
1, 2013, as follows:

(A) Moved into an existing conforming Structural Performance
Category-3 (SPC-3), Structural Performance Category-4 (SPC-4),
or Structural Performance Category-5 (SPC-5) and Non-Structural
Performance Category-4 (NPC-4) or Non-Structural Performance
Category-5 (NPC-5) building.

(B) Relocated to a newly built compliant SPC-5 and NPC-4 or
NPC-5 building.

(C) Continued in the building if the building is retrofitted to a
SPC-5 and NPC-4 or NPC-5 building.

(4) A five-year extension is also provided to a post-1973
building if the hospital owner informs the Office of Statewide
Health Planning and Development that the building is classified
as SPC-1, SPC-3, or SPC-4 and will be closed to general acute
care inpatient service use by January 1, 2013. The basic services
in the building shall be relocated into a SPC-5 and NPC-4 or NPC-5
building by January 1, 2013.

(5) SPC-1 buildings, other than the building identified in
paragraph (3) or (4), in the contiguous grouping of hospital
buildings shall also be exempt from the requirement in subdivision
(a) until January 1, 2013. However, on or before January 1, 2013,
at a minimum, each of these buildings shall be retrofitted to a
SPC-2 and NPC-3 building, or no longer be used for general acute
care hospital inpatient services.

(c) On or before March 1, 2001, the office shall establish a
schedule of interim work progress deadlines that hospitals shall
be required to meet to be eligible for the extension specified in
subdivision (b). To receive this extension, the hospital building or
buildings shall meet the year 2002 nonstructural requirements.

(d) A hospital building that is eligible for an extension pursuant
to this section shall meet the January 1, 2030, nonstructural and
structural deadline requirements if the building is to be used for
general acute care inpatient services after January 1, 2030.

(e) Upon compliance with subdivision (b), the hospital shall be
issued a written notice of compliance by the office. The office
shall send a written notice of violation to hospital owners that fail
to comply with this section. The office shall make copies of these
notices available on its Internet Web site.

(f) (1) A hospital that has received an extension of the January
1, 2008, deadline pursuant to subdivision (a) or (b) may request
an additional extension of up to two years for a hospital building
that it owns or operates and that meets the criteria specified in
paragraph (2), (3), or (5).

(2) The office may grant the additional extension if the hospital
building subject to the extension meets all of the following criteria:

(A) The hospital building is under construction at the time of
the request for extension under this subdivision and the purpose
of the construction is to meet the requirements of subdivision (a)
to allow the use of the building as a general acute care hospital
building after the extension deadline granted by the office pursuant
to subdivision (a) or (b).

(B) The hospital building plans were submitted to the office
and were deemed ready for review by the office at least four years
prior to the applicable deadline for the building. The hospital shall
indicate, upon submission of its plans, the SPC-1 building or
buildings that will be retrofitted or replaced to meet the
requirements of this section as a result of the project.

(C) The hospital received a building permit for the construction
described in subparagraph (A) at least two years prior to the
applicable deadline for the building.

(D) The hospital submitted a construction timeline at least two
years prior to the applicable deadline for the building demonstrating
the hospital’s intent to meet the applicable deadline. The timeline
shall include all of the following:

(i) The projected construction start date.

(ii) The projected construction completion date.

(iii) Identification of the contractor.

(E) The hospital is making reasonable progress toward meeting
the timeline set forth in subparagraph (D), but factors beyond the
hospital’s control make it impossible for the hospital to meet the
deadline.

(3) The office may grant the additional extension if the hospital
building subject to the extension meets all of the following criteria:

(A) The hospital building is owned by a health care district that
has, as owner, received the extension of the January 1, 2008,
deadline, but where the hospital is operated by an unaffiliated
third-party lessee pursuant to a facility lease that extends at least
through December 31, 2009. The district shall file a declaration
with the office with a request for an extension stating that, as of
the date of the filing, the district has lacked, and continues to lack,
unrestricted access to the subject hospital building for seismic
planning purposes during the term of the lease, and that the district
is under contract with the county to maintain hospital services
when the hospital comes under district control. The office shall
not grant the extension if an unaffiliated third-party lessee will
operate the hospital beyond December 31, 2010.

(B) The hospital building plans were submitted to the office
and were deemed ready for review by the office at least four years
prior to the applicable deadline for the building. The hospital shall
indicate, upon submission of its plans, the SPC-1 building or
buildings that will be retrofitted or replaced to meet the
requirements of this section as a result of the project.

(C) The hospital received a building permit for the construction
described in subparagraph (B) by December 31, 2011.

(D) The hospital submitted, by December 31, 2011, a
construction timeline for the building demonstrating the hospital’s
intent and ability to meet the deadline of December 31, 2014. The
timeline shall include all of the following:

(i) The projected construction start date.

(ii) The projected construction completion date.

(iii) Identification of the contractor.

(E) The hospital building is under construction at the time of
the request for the extension, the purpose of the construction is to
meet the requirements of subdivision (a) to allow the use of the
building as a general acute care hospital building after the extension
deadline granted by the office pursuant to subdivision (a) or (b),
and the hospital is making reasonable progress toward meeting
the timeline set forth in subparagraph (D).

(F) The hospital granted an extension pursuant to this paragraph
shall submit an additional status report to the office, equivalent to
that required by subdivision (c) of Section 130061, no later than
June 30, 2013.

(4) An extension granted pursuant to paragraph (3) shall be
applicable only to the health care district applicant and its affiliated
hospital while the hospital is operated by the district or an entity
under the control of the district.

(5) The office may grant the additional extension if the hospital
building subject to the extension meets all of the following criteria:

(A) The hospital owner submitted to the office, prior to June
30, 2009, a request for review using current computer modeling
utilized by the office and based upon software developed by the
Federal Emergency Management Agency (FEMA), referred to as
Hazards US, and the building was deemed SPC-1 after that review.

(B) The hospital building plans for the building are submitted
to the office and deemed ready for review by the office prior to
July 1, 2010. The hospital shall indicate, upon submission of its
plans, the SPC-1 building or buildings that shall be retrofitted or
replaced to meet the requirements of this section as a result of the
project.

(C) The hospital receives a building permit from the office for
the construction described in subparagraph (B) prior to January 1,
2012.

(D) The hospital submits, prior to January 1, 2012, a
construction timeline for the building demonstrating the hospital’s
intent and ability to meet the applicable deadline. The timeline
shall include all of the following:

(i) The projected construction start date.

(ii) The projected construction completion date.

(iii) Identification of the contractor.

(E) The hospital building is under construction at the time of
the request for the extension, the purpose of the construction is to
meet the requirements of subdivision (a) to allow the use of the
building as a general acute care hospital building after the extension
deadline granted by the office pursuant to subdivision (a) or (b),
and the hospital is making reasonable progress toward meeting
the timeline set forth in subparagraph (D).

(F) The hospital owner completes construction such that the
hospital meets all criteria to enable the office to issue a certificate
of occupancy by the applicable deadline for the building.

(6) A hospital located in the County of Sacramento, San Mateo,
or Santa Barbara or the City of San Jose that has received an
additional extension pursuant to paragraph (2) or (5) may request
an additional extension until September 1, 2015, to obtain either
a certificate of occupancy from the office for a replacement
building, or a construction final from the office for a building on
which a retrofit has been performed.

(7) A hospital denied an extension pursuant to this subdivision
may appeal the denial to the Hospital Building Safety Board.

(8) The office may revoke an extension granted pursuant to this
subdivision for any hospital building where the work of
construction is abandoned or suspended for a period of at least one
year, unless the hospital demonstrates in a public document that
the abandonment or suspension was caused by factors beyond its
control.

(g) (1) Notwithstanding subdivisions (a), (b), (c), and (f), and
Sections 130061.5 and 130064, a hospital that has received an
extension of the January 1, 2008, deadline pursuant to subdivision
(a) or (b) also may request an additional extension of up to seven
years for a hospital building that it owns or operates. The office
may grant the extension subject to the hospital meeting the
milestones set forth in paragraph (2).

(2) The hospital building subject to the extension shall meet all
of the following milestones, unless the hospital building is
reclassified as SPC-2 or higher as a result of its Hazards US score:

(A) The hospital owner submits to the office, no later than
September 30, 2012, a letter of intent stating whether it intends to
rebuild, replace, or retrofit the building, or remove all general acute
care beds and services from the building, and the amount of time
necessary to complete the construction.

(B) The hospital owner submits to the office, no later than
September 30, 2012, a schedule detailing why the requested
extension is necessary, and specifically how the hospital intends
to meet the requested deadline.

(C) The hospital owner submits to the office, no later than
September 30, 2012, an application ready for review seeking
structural reassessment of each of its SPC-1 buildings using current
computer modeling based upon software developed by FEMA,
referred to as Hazards US.

(D) The hospital owner submits to the office, no later than
January 1, 2015, plans ready for review consistent with the letter
of intent submitted pursuant to subparagraph (A) and the schedule
submitted pursuant to subparagraph (B).

(E) The hospital owner submits a financial report to the office
at the time the plans are submitted pursuant to subparagraph (D).
The report shall demonstrate the hospital owner’s financial capacity
to implement the construction plans submitted pursuant to
subparagraph (D).

(F) The hospital owner receives a building permit consistent
with the letter of intent submitted pursuant to subparagraph (A)
and the schedule submitted pursuant to subparagraph (B), no later
than July 1, 2018.

(3) To evaluate public safety and determine whether to grant
an extension of the deadline, the office shall consider the structural
integrity of the hospital’s SPC-1 buildings based on its Hazards
US scores, community access to essential hospital services, and
the hospital owner’s financial capacity to meet the deadline as
determined by either a bond rating of BBB or below or the financial
report on the hospital owner’s financial capacity submitted pursuant
to subparagraph (E) of paragraph (2). The criteria contained in this
paragraph shall be considered by the office in its determination of
the length of an extension or whether an extension should be
granted.

(4) The extension or subsequent adjustments granted pursuant
to this subdivision may not exceed the amount of time that is
reasonably necessary to complete the construction specified in
paragraph (2).

(5) If the circumstances underlying the request for extension
submitted to the office pursuant to paragraph (2) change, the
hospital owner shall notify the office as soon as practicable, but
in no event later than six months after the hospital owner
discovered the change of circumstances. The office may adjust the
length of the extension granted pursuant to paragraphs (2) and (3)
as necessary, but in no event longer than the period specified in
paragraph (1).

(6) A hospital denied an extension pursuant to this subdivision
may appeal the denial to the Hospital Building Safety Board.

(7) The office may revoke an extension granted pursuant to this
subdivision for any hospital building when it is determined that
any information submitted pursuant to this section was falsified,
or if the hospital failed to meet a milestone set forth in paragraph
(2), or where the work of construction is abandoned or suspended
for a period of at least six months, unless the hospital demonstrates
in a publicly available document that the abandonment or
suspension was caused by factors beyond its control.

(8) Regulatory submissions made by the office to the California
Building Standards Commission to implement this section shall
be deemed to be emergency regulations and shall be adopted as
emergency regulations.

(9) The hospital owner that applies for an extension pursuant
to this subdivision shall pay the office an additional fee, to be
determined by the office, sufficient to cover the additional
reasonable costs incurred by the office for maintaining the
additional reporting requirements established under this section,
including, but not limited to, the costs of reviewing and verifying
the extension documentation submitted pursuant to this subdivision.
This additional fee shall not include any cost for review of the
plans or other duties related to receiving a building or occupancy
permit.

(10) This subdivision shall become operative on the date that
the State Department of Health Care Services receives all necessary
federal approvals for a 2011-12 fiscal year hospital quality
assurance fee program that includes three hundred twenty million
dollars ($320,000,000) in fee revenue to pay for health care
coverage for children, which is made available as a result of the
legislative enactment of a 2011-12 fiscal year hospital quality
assurance fee program.

SEC. 2.  

The Legislature finds and declares that a special law
is necessary and that a general law cannot be made applicable
within the meaning of Section 16 of Article IV of the California
Constitution because of the unique circumstances facing hospitals
in the Counties of Sacramento, San Mateo, and Santa Barbara and
the City of San Jose that are working on meeting seismic safety
building standards.

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This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:

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To prevent the loss of hospital licensure, Medicaid and Medicare
funding, and eligibility for Federal Emergency Management
Agency assistance following a disaster that would lead to hospital
closures and loss of access to health care in these communities, it
is necessary for this act to take effect immediately.

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