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Report

Managing Floods in California

March 22, 2017 - This report is intended to provide basic information about floods and flood management in California. (Whereas previous generations referred to “flood control” or “flood prevention” activities, experts now prefer the term “flood management” in acknowledgement that floodwaters are recurring and inevitable.) We begin by summarizing the history, causes, and risk of floods across the state. We then describe flood management agencies, infrastructure, and strategies, as well as how governmental agencies typically respond when floods occur. Next, we describe the spending levels and funding sources currently supporting flood management efforts, as well as estimates for how much additional funding may be needed to improve those efforts. We conclude by highlighting some key challenges confronting the state in contemplating how best to manage floods in California.

Report

The 2017-18 Budget: Analysis of Child Care and Preschool Proposals

March 16, 2017 - In this report, we analyze the Governor’s child care and preschool proposals. The report has six main sections. In the first section, we provide background on child care and preschool programs in California. In the second section, we provide an overview of the Governor’s child care and preschool proposals. In the third section, we analyze the Governor’s preschool proposals and make associated recommendations. In the following two sections, we provide in‑depth analyses of (1) the state’s various quality improvement activities and (2) Alternative Payment agencies, which administer certain child care programs. The final section consists of a summary of the recommendations we make throughout the report.

Report

Savings Plus Program: An Optional Retirement Benefit for State Employees

March 14, 2017 - This report examines the Savings Plus Program (the state's optional retirement savings plan for state employees). We find that, although anyone can benefit from saving money for their retirement, certain groups of state employees--those who work less than a full career, earn lower salaries, and are hired in the future and earn less generous retirement benefits as a result of recent policy changes--could significantly improve their financial security in retirement by saving more money on their own during their working career. In this report, we discuss our findings and options the Legislature can consider to improve employee participation. This report reflects policy changes established through labor agreements that require state employees to contribute a percentage of pay to prefund retiree health benefits and reduce retiree health benefits for future employees. Some of these agreements currently are pending legislative ratification.

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The 2017-18 Budget: Analysis of the Medi-Cal Budget

March 9, 2017 - In California, the federal‑state Medicaid program is administered by the Department of Health Care Services (DHCS) as the California Medical Assistance Program (Medi‑Cal). Medi‑Cal is by far the largest state‑administered health services program in terms of annual caseload and expenditures. In this report, we provide an analysis of the administration’s caseload projections, including a discussion of the projected increases in ACA optional expansion caseload. We also provide an assessment of several aforementioned major factors affecting projected changes in Medi‑Cal spending in 2017‑18 and other policy changes proposed by the administration. These include the Governor’s proposed uses of Proposition 56 revenues, the proposal to shift additional New Qualified Immigrants (NQIs) to Covered California in 2017‑18, assumptions around federal CHIP funding, and the proposed abolition and transfer of the Major Risk Medical Insurance Fund (MRMIF).

Report

Do Communities Adequately Plan for Housing?

March 8, 2017 - In this report, we review the available evidence to gauge whether housing element law--the state's primary tool to ensure that local governments adequately plan for new housing--achieves their objective of ensuring that local communities accommodate future home building. Our review suggests that housing elements fall well short of their goal. Communities’ zoning rules often are out of sync with the types of projects developers desire to build and households desire to live in. As a result, home building lags behind demand. Although we offer a few changes the Legislature could consider, real improvement can come only with a major shift in how communities and their residents think about and value new housing.

Report

The 2017-18 Budget: Governor’s Criminal Fine and Fee Proposals

March 3, 2017 - The Governor’s 2017‑18 budget includes three specific proposals related to the state’s criminal fine and fee system. In this report, we provide a general overview of the fine and fee system and then discuss each of the Governor’s proposals. In particular, we assess the impact that each proposal would have on the system and make recommendations for legislative consideration.

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The 2017-18 Budget: Governor's Gann Limit Proposal

March 2, 2017 - Under the State Constitution, state tax revenues in excess of the Prop 4 (1979) state appropriations limit, or Gann Limit, must be split between taxpayer rebates and additional school spending. The Governor now proposes a new calculation methodology that creates $22 billion in additional state spending capacity. We find that the Governor's proposal violates the spirit of Proposition 4 and—in our view—is highly vulnerable to legal challenges. We recommend that the Legislature reject the proposal and offer options for legislative consideration.

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The 2017-18 Budget: California State Payroll System

February 28, 2017 - The State Controller’s Office (SCO) has recently renewed its effort to replace the state’s payroll system. In this year’s budget, the Governor proposes $3 million to begin an analysis of proposed alternatives for replacing the system. It makes sense for the state to assess the potential problems, both in terms of functionality and stability, with the state’s payroll system and to explore solutions to these problems. The appropriate selection of a project alternative will be critical to the success of the future payroll project. As such, we recommend the Legislature require the SCO to present its full findings from the alternatives analysis before it is granted additional funding for subsequent analyses. This would provide the Legislature with a clear opportunity to provide meaningful input and weigh in with its own priorities for the payroll system before a solution is procured.

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The 2017-18 Budget: The Coordinated Care Initiative: A Critical Juncture

February 27, 2017 - In this report we provide (1) background on the health care and Long‑Term Services and Supports (LTSS) issues that the Coordinated Care Initiative (CCI) was intended to address, (2) an update on the CCI’s results and challenges to date, (3) an assessment of the Governor’s elimination of the CCI and budget proposal to extend certain CCI components, and (4) options for the Legislature on how to move forward. As ending the In‑Home Supportive Services (IHSS) has major, and rather complex, implications for 1991 realignment, we include a technical appendix at the end of this report that provides an in‑depth analysis of these implications.

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The 2017-18 Budget: Analysis of the Department of Developmental Services Budget

February 24, 2017 - In this report, we discuss the Governor’s budget proposals for Department of Developmental Services (DDS), providing our assessment of the budget package for DDS and analyzing one of the proposed trailer bills, which we find raises a number of issues. Also in this report, we describe the general nature of shifts in both policy and practice in the field of developmental services, detailing the relevant state and federal policies and their implications for the future developmental services program in the state, and discussing issues for the Legislature to consider as DDS implements these changes.

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The 2017-18 Budget: Alternatives to the Governor’s Proposition 2 Proposals

February 23, 2017 - Proposition 2 (2014) requires the state to make: (1) minimum annual payments toward certain eligible debts and (2) deposits into the state’s rainy day fund. This publication outlines alternatives to the Governor’s proposals that could free up General Fund resources. It also addresses whether the Legislature can access funds from state’s rainy day reserve under the measure’s budget emergency provisions.

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The 2017-18 Budget: An Overview of the Governor's Proposition 56 Proposals

February 22, 2017 - Proposition 56 was approved by voters in November 2016 to increase taxes on cigarettes and other tobacco products. Questions have been raised as to whether the Governor’s proposals for allocating Proposition 56 revenues meet the initiative’s requirement to supplement—and not supplant—existing spending in several areas. To examine these questions, we begin by reviewing the provisions of Proposition 56 and the Governor’s budget proposals. We then discuss whether the Governor’s proposals for Medi‑Cal could be viewed as supplanting General Fund resources and identify the relevant case law. We conclude by describing some trade‑offs for the Legislature to consider in allocating the Proposition 56 revenues.

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The 2017-18 Budget: Transportation Funding Package

February 17, 2017 - In this report, we (1) provide background information on the state’s major transportation programs and funding sources, (2) describe the Governor’s proposed 2017‑18 transportation package including how the increased funding would be allocated, and (3) provide a road map to assist the Legislature in making certain key decisions it will face in developing a transportation package.

Report

The Uncertain Affordable Care Act Landscape: What It Means for California

February 17, 2017 - Summarizes the major impacts that the ACA has had in California, explores what the ACA’s repeal could mean for the state, and assesses a collection of policy alternatives to the ACA that the new federal administration and Congress are currently considering.

Correction 3/6/17: Removed reference to Alpine County as having only one participating insurer.

Report

The 2017-18 Budget: The New IT Project Approval and Funding Process

February 17, 2017 - In recent years, the California Department of Technology has begun implementing a new IT project approval process—known as the Project Approval Lifecycle (PAL)—with the goal of helping to bolster project planning and reducing the likelihood of project challenges or failure. Although the PAL process has the potential to improve the quality of IT project implementation in theory, we raise a number of issues for the Legislature to consider as it exercises oversight of this new process. First, the merits of providing funding for IT project planning proposals should be determined on a case-by-case basis, and we note a few issues the Legislature may want to consider when determining whether to support a request for IT project planning funds. Additionally, we identify these funding requests for PAL-related planning activities as an early opportunity for the Legislature to weigh in on the potential project. Finally, we find that the Legislature could increase its oversight of the PAL process by (1) building in additional oversight methods when approving budget requests and (2) considering an evaluation of the actual benefits of the new project approval process.