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2015

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Governor Announces Proposal to Close Developmental Centers (DCs)

In our 2015-16 Budget: Analysis of the Human Services Budget we found that there is justification for closing Fairview and Sonoma DCs on both a fiscal and policy basis. Accordingly, we concluded that the Department of Developmental Services (DDS) should close both Fairview and Sonoma DCs within ten years. Under the Governor’s May Revision proposal, Sonoma DC would close by the end of 2018, and Fairview DC and the general treatment area of Porterville DC would close by the end of 2021. We agree in concept with the Governor’s proposal, although we note that detailed plans for the proposed DC closures will likely not be provided by the administration to the Legislature until the late summer or fall of 2015 at the earliest. Here we provide a brief background on DCs and our initial assessment of the Governor’s proposal.

Background

The DDS Operates Three DCs. The DDS operates three 24-hour facilities known as DCs—Fairview DC in Orange County, Porterville DC in Tulare County, and Sonoma DC in Sonoma County—and one smaller leased community facility (Canyon Springs in Riverside County). Together, these facilities provide 24-hour care and supervision to approximately 1,100  consumers in 2014-15. Each DC is licensed by the Department of Public Health (DPH), and certified by DPH on behalf of the federal Centers for Medicare and Medicaid Services (CMS) as skilled nursing facilities, intermediate care facilities for the developmentally disabled, and general acute care hospitals. The DCs are licensed and certified to provide a broad array of services, such as nursing services, assistance with activities of daily living, specialized rehabilitative services, individualized dietary services, and vocational or other day programs. For more background information on the DCs, see The 2015-16 Budget: Analysis of the Human Services Budget.

Implementation of a DC Closure Plan Requires the Legislature’s Approval. The implementation of a DC closure plan is contingent on legislative approval of the plan. State law requires DDS to submit a detailed plan to the Legislature not later than April 1, immediately prior to the fiscal year in which the plan is to begin implementation, and as a part of the Governor’s proposed budget. Prior to the submission of a DC closure plan to the Legislature, the department must complete the following:

• Solicit input from various parties including the State Council on Developmental Disabilities, the Association of Regional Center Agencies, DC residents and their parents and guardians, DC employees and employee organizations, the affected city and county governments, business and civic organizations, and other specified entities.

• Confer with the county in which the DC is located, the regional centers (RCs) served by the DC, and other state departments using similar occupational classifications to develop a program for the placement of staff of the DC planned for closure in jobs in state departments, local government, or RC programs.

• Hold at least one public hearing in the community in which the DC is located, with public comment from that hearing being summarized in the closure plan.

The plan submitted to the Legislature must include nine elements including: (1) the impact on residents and their families, (2) the impact on RCs, and (3) the fiscal impact of the closure. A DC closure plan submitted to the Legislature may be modified during the legislative review process.

Governor’s Proposal

The administration has stated its goal of closing Sonoma DC by the end of 2018 and closing Fairview DC and the general treatment area at Porterville DC by the end of 2021.  The Governor proposes trailer bill language requiring DDS to submit, on or before October 1, 2015, a plan or plans to close one or more DCs. According to the department, it plans to comply with all of the statutory closure plan development requirements described above and that is why it will take until as late as October 1, 2015 to submit a DC closure plan to the Legislature.

The proposed trailer bill language would allow the department to develop community resources and otherwise engage in activities for transitioning DC residents to the community utilizing funds allocated for these purposes in the 2015-16 budget plan. The May Revision provides $49.3 million ($46.9 million General Fund) to begin the development of resources necessary to support Sonoma DC residents in the community and for closure activities including:

• $46.7 million for program start-up and placement costs;

• $1.3 million for RC operational costs;

• $1.3 million for the transfer of seven positions from the DCs to DDS headquarters and contracts with the Department of Social Services for closure-related workload.

Issues for Legislative Consideration

Here we provide some initial issues for the Legislature to consider as it deliberates over the Governor’s DC closure proposal.

Proposed Schedule for DC Closures Faster Than Prior Two DC Closures. The state has successfully closed Agnews DC—over the five-year period from 2004-05 to 2008-09—and Lanterman DC—over the six-year period from 2009-10 to 2014-15. The proposed closure of Sonoma and Fairview DCs and the general treatment area at Porterville DC over six years is a shorter time period than the eleven-year period it took to close both Agnews and Lanterman DCs one at a time. Given the proposed time line calls for a faster closure than the prior two DC closures, it will be important to put comprehensive measures in place to ensure the health and safety of the residents as they transition from the DCs to the community.

Some Closure-Related Activities Are Not Allowed Until Legislature Approves Closure Plan. Under state law, a DC closure plan submitted to the Legislature shall not be implemented without the approval of the Legislature. Therefore, it is important that DDS limit its closure-related activities to those allowable under state law prior to legislative approval of a closure plan. This will ensure the Legislature will have a chance to weigh in on the DC closure plans and modify them to meet legislative priorities and objectives.

Analyst’s Recommendations

We have the following recommendations regarding the Governor’s proposal to initiate the closure of DCs:

• Adopt Placeholder Trailer Bill Language. We recommend the Legislature adopt the administration’s proposed trailer bill language as placeholder trailer bill language to allow the Legislature to continue to work with the administration regarding the closure plan submission process. We think the Legislature should do this because the proposed trailer bill language is consistent with state and federal policies regarding DCs.

• Approve Requested Resources. We recommend the Legislature approve the three May Revision requests for a total of $49.3 million ($46.9 million General Fund) to begin the development of resources necessary to support Sonoma DC residents in the community. We note that the approval of these resources is consistent with existing state and federal policies.

• Require the Department to Report on Allowable Closure Activities. The timing of legislative approval of a closure plan may affect the department’s ability to go forward with certain closure activities, potentially delaying the ultimate closure of a DC. We recommend the Legislature require the department to report at budget hearings regarding which closure activities are allowable under current law prior to legislative approval of a closure plan and which closure-related activities are contingent upon legislative approval of a closure plan.  

• Require the Department to Report on Consumer Health and Safety Measures. We recommend the Legislature require the department to report at budget hearings on the measures that will be put in place to safeguard the health and safety of DC residents transitioning to community placements given the time line proposed for closure is faster than prior closures.