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

SECTI/div>
SEC. 2.
Section 5008.9 is added to the Corporations Code, to read:
5008.9.
(a) A nonprofit corporation described in Section 5059, 5060, or 5061, or a foreign nonprofit corporation, as defined in Section 5053, that has qualified to transact intrastate business, shall be subject to administrative dissolution or administrative surrender in accordance with this section if, as of January 1, 2016, or later, the nonprofit corporation’s or foreign corporation’s corporate powers are, and have been, suspended or forfeited by the Franchise Tax Board for a period of not less than 48 continuous months.
(b) Prior to the administrative dissolution or administrative surrender of the nonprofit corporation or foreign corporation, the corporation shall be notified of the pending administrative dissolution or administrative surrender as follows:
(1) The Franchise Tax Board shall mail written notice to the last known address of a nonprofit corporation or foreign corporation meeting the requirement described in subdivision (a).
(2) If the nonprofit corporation or foreign corporation does not have a valid address in the records of the Franchise Tax Board, the notice provided in subdivision (d) shall be deemed sufficient notice prior to administrative dissolution or administrative surrender.
(c) The Franchise Tax Board shall transmit to the Secretary of State and the Attorney General’s Registry of Charitable Trusts the names and Secretary of State file numbers of nonprofit corporations and foreign corporations subject to the administrative dissolution or administrative surrender provisions of this section.
(d) The Secretary of State shall provide 60 calendar days’ notice of the pending administrative dissolution or administrative surrender on its Internet Web site by listing the corporation name and the Secretary of State’s file number for the nonprofit corporation or foreign corporation. The Secretary of State shall also, in conjunction with the information above, provide instructions for a nonprofit corporation or foreign corporation to submit a written objection of the pending administrative dissolution or administrative surrender to the Franchise Tax Board.
(e) (1) A nonprofit corporation or foreign corporation may provide the Franchise Tax Board with a written objection to the administrative dissolution or administrative surrender.
(2) The Franchise Tax Board shall notify the Secretary of State if a written objection has been received.
(f) If no written objection to the administrative dissolution or administrative surrender is received by the Franchise Tax Board during the 60-day period described in subdivision (d), the nonprofit corporation or foreign corporation shall be administratively dissolved or administratively surrendered in accordance with this section. The certificate of the Secretary of State shall be prima facie evidence of the administrative dissolution or administrative surrender.
(g) (1) If the written objection of a nonprofit corporation or foreign corporation to the administrative dissolution or administrative surrender has been received by the Franchise Tax Board before the expiration of the 60-day period described in subdivision (d), that nonprofit corporation or foreign corporation shall have an additional 90 days from the date the written objection is received by the Franchise Tax Board to pay or otherwise satisfy all accrued taxes, penalties, and interest and to file a current Statement of Information with the Secretary of State.
(2) (A) If the conditions in paragraph (1) are satisfied, the administrative dissolution or administrative surrender shall be canceled.
(B) If the conditions in paragraph (1) are not satisfied, the nonprofit corporation or foreign corporation shall be administratively dissolved or administratively surrendered in accordance with this section as of the date that is 90 days after the receipt of the written objection.
(3) The Franchise Tax Board may extend the 90-day period in paragraph (1), but for no more than one period of 90 days.
(h) Upon administrative dissolution or administrative surrender in accordance with this section, the nonprofit corporation’s or the foreign corporation’s liabilities for qualified taxes, interest, and penalties as defined in Section 23156 of the Revenue and Taxation Code, if any, shall be abated. Any actions taken by the Franchise Tax Board to collect that abated liability shall be released, withdrawn, or otherwise terminated by the Franchise Tax Board, and no subsequent administrative or civil action shall be taken or brought to collect all or part of that amount. Any amounts erroneously received by the Franchise Tax Board in contravention of this section may be credited and refunded in accordance with Article 1 (commencing with Section 19301) of Chapter 6 of Part 10.2 of Division 2 of the Revenue and Taxation Code.
(i) If the nonprofit corporation or foreign corporation is administratively dissolved or administratively surrendered under this section, the liability to creditors, if any, is not discharged. The liability of the directors of, or other persons related to, the administratively dissolved or administratively surrendered nonprofit corporation or foreign corporation is not discharged. The administrative dissolution or administrative surrender of a nonprofit corporation or foreign corporation pursuant to this section shall not diminish or adversely affect the ability of the Attorney General to enforce liabilities as otherwise provided by law.
SEC. 3.
Section 6610.5 is added to the Corporations Code, to read:
6610.5.
(a) Notwithstanding any other provision of this division, when a corporation has not issued any memberships, a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators, may sign and verify a certificate of dissolution stating all of the following:
(1) That the certificate of dissolution is being filed within 24 months from the date the articles of incorporation were filed.
(2) That the corporation does not have any debts or other liabilities, except as provided in paragraph (3) and subdivision (d).
(3) That the tax liability will be satisfied on a taxes-paid basis or that a person or corporation or other business entity assumes the tax liability, if any, of the dissolving corporation and is responsible for additional corporate taxes, if any, that are assessed and that become due after the date of the assumption of the tax liability.
(4) That a final franchise tax return, as described by Section 23332 of the Revenue and Taxation Code, has been or will be filed with the Franchise Tax Board as required under Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code.
(5) That the corporation was created in error.
(6) That the known assets of the corporation remaining after payment of, or adequately providing for, known debts and liabilities have been distributed as required by law or that the corporation acquired no known assets, as the case may be.
(7) That a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators authorized the dissolution and elected to dissolve the corporation.
(8) That the corporation has not issued any memberships, and if the corporation has received payments for memberships, those payments have been returned to those making the payments.
(9) That the corporation is dissolved.
(b) A certificate of dissolution signed and verified pursuant to subdivision (a) shall be filed with the Secretary of State. The Secretary of State shall notify the Franchise Tax Board and the Attorney General’s Registry of Charitable Trusts of the dissolution.
(c) Upon filing a certificate of dissolution pursuant to subdivision (b), a corporation shall be dissolved and its powers, rights, and privileges shall cease.
(d) Notwithstanding the dissolution of a corporation pursuant to this section, its liability to creditors, if any, is not discharged. The liability of the directors of, or other persons related to, the dissolved corporation is not discharged. The dissolution of a corporation pursuant to this section shall not diminish or adversely affect the ability of the Attorney General to enforce liabilities as otherwise provided by law.
SEC. 4.
Section 8610.5 is added to the Corporations Code, to read:
8610.5.
(a) Notwithstanding any other provision of this division, when a corporation has not issued any memberships, a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators, may sign and verify a certificate of dissolution stating the following:
(1) That the certificate of dissolution is being filed within 24 months from the date the articles of incorporation were filed.
(2) That the corporation does not have any debts or other liabilities, except as provided in paragraph (3) and subdivision (d).
(3) That the tax liability will be satisfied on a taxes-paid basis, or that a person or corporation or other business entity assumes the tax liability, if any, of the dissolving corporation and is responsible for additional corporate taxes, if any, that are assessed and that become due after the date of the assumption of the tax liability.
(4) That a final franchise tax return, as described by Section 23332 of the Revenue and Taxation Code, has been or will be filed with the Franchise Tax Board as required under Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code.
(5) That the corporation was created in error.
(6) That the known assets of the corporation remaining after payment of, or adequately providing for, known debts and liabilities have been distributed as required by law or that the corporation acquired no known assets, as the case may be.
(7) That a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators authorized the dissolution and elected to dissolve the corporation.
(8) That the corporation has not issued any memberships, and if the corporation has received payments for memberships, those payments have been returned to those making the payments.
(9) That the corporation is dissolved.
(b) A certificate of dissolution signed and verified pursuant to subdivision (a) shall be filed with the Secretary of State. The Secretary of State shall notify the Franchise Tax Board and the Attorney General’s Registry of Charitable Trusts of the dissolution.
(c) Upon filing a certificate of dissolution pursuant to subdivision (b), a corporation shall be dissolved and its powers, rights, and privileges shall cease.
(d) Notwithstanding the administrative dissolution of a corporation pursuant to this section, its liability to creditors, if any, is not discharged. The liability of the directors of, or other persons related to, the administratively dissolved corporation is not discharged. The dissolution of a corporation pursuant to this section shall not diminish or adversely affect the ability of the Attorney General to enforce liabilities as otherwise provided by law.
SEC. 5.
Section 9680.5 is added to the Corporations Code, to read:
9680.5.
(a) Notwithstanding any other provision of this division, when a corporation has not issued any memberships, a majority of the directors, or, if no directors have been named in the articles or been elected, the incorporator or a majority of the incorporators, may sign and verify a certificate of dissolution stating the following:
(1) That the certificate of dissolution is being filed within 24 months from the date the articles of incorporation were filed.
(2) That the corporation does not have any debts or other liabilities, except as provided in paragraph (3) and subdivision (d).
(3) That the tax liability will be satisfied on a taxes-paid basis or that a person or corporation or other business entity assumes the tax liability, if any, of the dissolving corporation and is responsible for additional corporate taxes, if any, that are assessed and that become due after the date of the assumption of the tax liability.
(4) That a final franchise tax return, as described by Section 23332 of the Revenue and Taxation Code, has been or will be filed with the Franchise Tax Board as required under Part 10.2 (commencing with Section 18401) of Division 2 of the Revenue and Taxation Code.
(5) That the corporation was created in error.
(6) That the known assets of the corporation remaining after payment of, or adequately providing for, known debts and liabilities have been distributed as required by law or that the corporation acquired no known assets, as the case may be.
(7) That a majority of the directors, or, if no directors have been named in the articles or been elected, the incorporator or a majority of the incorporators authorized the dissolution and elected to dissolve the corporation.
(8) That the corporation has not issued any memberships, and if the corporation has received payments for memberships, those payments have been returned to those making the payments.
(9) That the corporation is dissolved.
(b) A certificate of dissolution signed and verified pursuant to subdivision (a) shall be filed with the Secretary of State. The Secretary of State shall notify the Franchise Tax Board of the dissolution.
(c) Upon filing a certificate of dissolution pursuant to subdivision (b), a corporation shall be dissolved and its powers, rights, and privileges shall cease.
(d) Notwithstanding the dissolution of a nonprofit corporation pursuant to this section, its liability to creditors, if any, is not discharged. The liability of the directors of, or other persons related to, the dissolved corporation is not discharged. The dissolution of a nonprofit corporation pursuant to this section shall not diminish or adversely affect the ability of the Attorney General to enforce liabilities as otherwise provided by law.
SEC. 6.
Section 23156 is added to the Revenue and Taxation Code, to read:
23156.
(a) The Franchise Tax Board shall abate, upon written request by a qualified nonprofit corporation, unpaid qualified taxes, interest, and penalties for the taxable years in which the qualified nonprofit corporation certifies, under penalty of perjury, that it was not doing business, within the meaning of subdivision (a) of Section 23101.
(b) For purposes of this section:
(1) “Qualified nonprofit corporation” means a nonprofit corporation identified in Section 5059, 5060, or 5061 of the Corporations Code or a foreign nonprofit corporation, as defined in Section 5053 of the Corporations Code that has qualified to transact intrastate business in this state and that satisfies any of the following conditions:
(A) Was operating and previously obtained tax-exempt status with the Franchise Tax Board, but had its tax-exempt status revoked under subdivision (c) of Section 23777.
(B) Was operating and previously obtained tax-exempt status with the Internal Revenue Service, but had its tax-exempt status revoked under Section 6033(j) of the Internal Revenue Code.
(C) Was never doing business, within the meaning of subdivision (a) of Section 23101, in this state at any time after the time of its incorporation in this state.
(2) “Qualified taxes, interest, and penalties” means tax imposed under Section 23153 and associated interest and penalties, and any penalties imposed under Section 19141. “Qualified taxes, interest, and penalties” does not include tax imposed under Section 23501 or 23731, or associated interest or penalties.
(c) The qualified corporation must establish that it has ceased all business operations at the time of filing the request for abatement under this section.
(d) (1) The abatement of unpaid qualified tax, interest, and penalties is conditioned on the dissolution of the qualified corporation within 12 months from the date of filing the request for abatement under this section.
(2) If the qualified corporation is not dissolved within 12 months from the date of filing the request for abatement or restarts business operations at any time after requesting abatement under this section, the abatement of qualified tax, interest, and penalties under this section shall be canceled and the qualified taxes, interest, and penalties subject to that abatement shall be treated as if the abatement never occurred.
(e) The Franchise Tax Board shall prescribe any rules and regulations that may be necessary or appropriate to implement this section. Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code shall not apply to any standard, criterion, procedure, determination, rule, notice, or guideline established or issued by the Franchise Tax Board pursuant to this section.
SEC. 7.
No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

Summary: The Nonprofit Corporation Law, among other things, generally regulates the organization and operation of nonprofit public benefit corporations, nonprofit mutual benefit corporations, and nonprofit religious corporations. Existing law authorizes the corporate powers, rights, and privileges of a domestic taxpayer to be suspended, and the exercise of the corporate powers, rights, and privileges of a foreign taxpayer in this state to be forfeited, if certain tax liabilities are not paid or a taxpayer fails to file a tax return. Existing law also authorizes the corporate powers, rights, and privileges of a domestic corporation exempt from income tax to be suspended and the exercise of the corporate powers, rights, and privileges of a foreign corporation in this state exempt from income tax to be forfeited if the organization fails to file the annual information return or a specified statement for organizations not required to file the information return or pay a specified amount due. Existing law requires notice prior to the suspension or forfeiture of a taxpayer’s corporate powers, rights, and privileges. Existing law requires the Franchise Tax Board to transmit to the Secretary of State the names of those taxpayers subject to these suspension or forfeiture provisions and thereby makes the suspension or forfeiture effective. Under existing law, the Secretary of State’s certificate is prima facie evidence of the suspension or forfeiture. This bill would make a nonprofit public benefit corporation, a nonprofit mutual benefit corporation, a nonprofit religious corporation, and a foreign nonprofit corporation, subject to administrative dissolution or administrative surrender, as specified, if the nonprofit corporation’s or foreign corporation’s corporate powers are, and have been, suspended or forfeited by the Franchise Tax Board for a specified period of time. Prior to the administrative dissolution or administrative surrender of the nonprofit corporation or foreign corporation, the bill would require the Franchise Tax Board to provide notice to the corporation of the pending administrative dissolution or administrative surrender. The bill would require the Franchise Tax Board to transmit to the Secretary of State and the Attorney General’s Registry of Charitable Trusts the names and Secretary of State file numbers of the corporations subject to administrative dissolution or administrative surrender. The bill would also require the Secretary of State to provide notice of the pending administrative dissolution or administrative surrender on its Internet Web site, as specified. The bill would authorize a nonprofit corporation or foreign corporation to provide the Franchise Tax Board with a written objection to the administrative dissolution or administrative surrender. If there is no written objection or the written objection fails, the bill would require the corporation to be administratively dissolved or administratively surrendered and would provide that the certificate of the Secretary of State is prima facie evidence of the administrative dissolution or administrative surrender. Upon administrative dissolution or administrative surrender, the bill would abate the nonprofit corporation’s liabilities for qualified taxes, interest, and penalties, as provided. Existing law, the Nonprofit Corporation Law, authorizes a nonprofit public benefit corporation, nonprofit mutual benefit corporation, and nonprofit religious corporation to elect voluntarily to wind up and dissolve by either approval of a majority of all members or approval of the board and approval of the members. Under existing law, the General Corporation Law, when a corporation has not issued shares, a majority of the directors, or, if no directors have been named in the articles or have been elected, the incorporator or a majority of the incorporators, are authorized to sign and verify a specified certificate of dissolution. Existing law requires the certificate to be filed with the Secretary of State and requires the Secretary of State to notify the Franchise Tax Board of the dissolution. Existing law provides that, upon the filing of the certificate, a corporation is dissolved and its powers, rights, and privileges cease. This bill would enact provisions similar to those General Corporation Law provisions and make them applicable to nonprofit public benefit corporations, nonprofit mutual benefit corporations, and nonprofit religious corporations. The bill would additionally provide that liability to creditors, if any, is not discharged, the liability of the directors of the dissolved nonprofit corporation is not discharged, and the dissolution of a nonprofit corporation does not diminish or adversely affect the ability of the Attorney General to enforce specified liabilities. Existing law requires every corporation doing business within the limits of this state and not expressly exempted from taxation to annually pay to the state, for the privilege of exercising its corporate franchises within this state, a tax according to or measured by its net income, as specified. Under existing law, every corporation, except as specified, is subject to the minimum franchise tax until the effective date of dissolution or withdrawal or, if later, the date the corporation ceases to do business within the limits of this state. Upon certification by the Secretary of State that a nonprofit public benefit corporation or a nonprofit mutual benefit corporation has failed to file the required Statement of Information, existing law requires the Franchise Tax Board to assess a specified penalty. This bill would require the Franchise Tax Board to abate, upon written request by a qualified nonprofit corporation, as defined, unpaid qualified taxes, interest, and penalties, as defined, for the taxable years in which the nonprofit corporation certifies, under penalty of perjury, that it was not doing business, as defined. The bill would make this abatement conditioned on the dissolution of the qualified corporation within a specified period of time of filing the request for abatement. The bill would require the Franchise Tax Board to prescribe rules and regulations to carry out these abatement provisions and would exempt these rules and regulations from the Administrative Procedure Act. Existing state constitutional law prohibits the Legislature from making any gift, or authorizing the making of any gift, of any public money or thing of value to any individual, municipal, or other corporation. This bill would make certain legislative findings and declarations that abatement of a nonprofit corporation’s liabilities for specified taxes, penalties, and interest serves a public purpose, as provided. By expanding the crime of perjury, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.

An act to add Sections 5008.9, 6610.5, 8610.5, and 9680.5 to the Corporations Code, and to add Section 23156 to the Revenue and Taxation Code, relating to nonprofit corporations.


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

SECTION 1.
Section 4677 of the Welfare and Institutions Code is amended to read:
4677.
(a) (1) All parental fees collected by or for regional centers shall be remitted to the State Treasury to be deposited in the Developmental Disabilities Program Development Fund, which is hereby created in the State Treasury and hereinafter called the Program Development Fund. The purpose of the Program Development Fund shall be to provide resources needed to initiate new programs, and to expand or convert existing programs. Within the context of, and consistent with, approved priorities for program development in the state plan, program development funds shall promote integrated residential, work, instructional, social, civic, volunteer, and recreational services and supports that increase opportunities for self-determination and maximum independence of persons with developmental disabilities. Notwithstanding any other law or regulation, commencing July 1, 2009, parental fees remitted to the State Treasury shall be deposited in accordance with Section 4784.
(2) In no event shall an allocation from the Program Development Fund be granted for more than 24 months.
(b) (1) The State Council on Developmental Disabilities shall, at least once every five years, request from all regional centers information on the types and amounts of services and supports needed, but currently unavailable.
(2) The state council shall work collaboratively with the department and the Association of Regional Center Agencies to develop standardized forms and protocols that shall be used by all regional centers and the state council in collecting and reporting this information. In addition to identifying services and supports that are needed, but currently unavailable, the forms and protocols shall also solicit input and suggestions on alternative and innovative service delivery models that would address consumer needs.
(3) In addition to the information provided pursuant to paragraph (2), the state council may utilize information from other sources, including, but not limited to, public hearings, quality assurance assessments conducted pursuant to Section 4571, regional center reports on alternative service delivery submitted to the department pursuant to Section 4669.2, and the annual report on self-directed services produced pursuant to Section 4685.7.
(4) The department shall provide additional information, as requested by the state council.
(5) Based on the information provided by the regional centers and other agencies, the state council shall develop an assessment of the need for new, expanded, or converted community services and support, and make that assessment available to the public. The assessment shall include a discussion of the type and amount of services and supports necessary but currently unavailable including the impact on consumers with common characteristics, including, but not limited to, disability, specified geographic regions, age, and ethnicity, face distinct challenges. The assessment shall highlight alternative and innovative service delivery models identified through their assessment process.
(6) This needs assessment shall be conducted at least once every five years and updated annually. The assessment shall be included in the state plan and shall be provided to the department and to the appropriate committees of the Legislature. The assessment and annual updates shall be made available to the public. The State Council on Developmental Disabilities, in consultation with the department, shall make a recommendation to the Department of Finance as to the level of funding for program development to be included in the Governor’s Budget, based upon this needs assessment.
(c) In addition to parental fees and General Fund appropriations, the Program Development Fund may be augmented by federal funds available to the state for program development purposes, when these funds are allotted to the Program Development Fund in the state plan. The Program Development Fund is available, upon appropriation by the Legislature, to the department, and subject to any allocations that may be made in the annual Budget Act. In no event shall any of these funds revert to the General Fund.
(d) The department may allocate funds from the Program Development Fund for any legal purpose, provided that requests for proposals and allocations are approved by the state council in consultation with the department, and are consistent with the priorities for program development in the state plan. Allocations from the Program Development Fund shall take into consideration the following factors:
(1) The future fiscal impact of the allocations on other state supported services and supports for persons with developmental disabilities.
(2) (A) The information on priority services and supports needed, but currently unavailable, submitted by the regional centers.
(B) Consistent with the level of need as determined in the state plan, excess parental fees may be used for purposes other than programs specified in subdivision (a) only when specifically appropriated to the State Department of Developmental Services for those purposes.
(e) Under no circumstances shall the deposit of federal moneys into the Program Development Fund be construed as requiring the State Department of Developmental Services to comply with a definition of “developmental disabilities” and “services for persons with developmental disabilities” other than as specified in subdivisions (a) and (b) of Section 4512 for the purposes of determining eligibility for developmental services or for allocating parental fees and state general funds deposited in the Program Development Fund.
SEC. 2.
Section 4782 of the Welfare and Institutions Code is repealed.
SEC. 3.
Section 4784 of the Welfare and Institutions Code is amended to read:
4784.
(a) The Director of Developmental Services shall establish, annually review, and adjust as needed, a schedule of parental fees for services received through the regional centers. Effective July 1, 2009, this schedule shall be revised to reflect changes in economic conditions that affect parents’ ability to pay the fee, but not to exceed an inflationary factor as determined by the department.
(b) The parental fee schedule established pursuant to this section shall be exempt from Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(c) In establishing the amount parents shall pay, the director shall take into account all of the following factors:
(1) The current cost of caring for a child at home, as determined by the most recent data available from the United States Department of Agriculture’s survey on the cost of raising a child in California, adjusted for the Consumer Price Index (CPI) from the survey date to the date of payment adjustment.
(2) Medical expenses incurred prior to regional center care.
(3) Whether the child is living at home.
(4) Parental payments for medical expenses, clothing, incidentals, and other items considered necessary for the normal rearing of a child.
(5) Transportation expenses incurred in visiting a child.
(d) The parental fee schedule shall exempt families with an income below the federal poverty level from assessment and payment of the parental fee.
(e) (1) The adjusted fee shall be assessed in full for children when the out-of-home placement commences on or after July 1, 2009.
(2) For children placed out-of-home prior to July 1, 2009, the department shall determine the increase in the parental fee above the amount assessed using the fee schedule in effect on June 30, 2009. This fee increase shall be implemented over three years, with one-third of the increase added to the fee on July 1, 2009, one-third of the increase added to the fee on July 1, 2010, and the final third added to the fee on July 1, 2011.
(f) Notwithstanding any other law, commencing July 1, 2009, all fees collected shall be remitted to the State Treasury to be deposited as follows:
(1) Fees collected up to the amount that would be assessed using the fee schedule in effect on June 30, 2009, shall be deposited into the Program Development Fund established in Chapter 6 (commencing with Section 4670) to provide resources needed to initiate new programs, consistent with approved priorities for program development in the state plan.
(2) Fees collected using the July 1, 2009, schedule that are greater than the amount that would have been assessed using the fee schedule in effect on June 30, 2009, shall be deposited into the Program Development Fund and shall be available for expenditure by the department to offset General Fund costs.
(g) This section shall become inoperative on July 1, 2016, and, as of January 1, 2017, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2017, deletes or extends the dates on which it becomes inoperative and is repealed.
SEC. 4.
Section 4784 is added to the Welfare and Institutions Code, to read:
4784.
(a) The department shall assess a monthly fee to parents of children under 18 years of age who are receiving 24-hour out-of-home care services through a regional center or as a resident of a state hospital when the family’s gross income is above 200 percent of the federal poverty level.
(b) The monthly parental fees and credits established pursuant to this section shall be exempt from Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(c) A monthly parental fee described in this section shall be assessed beginning 60 days from the date of the child’s placement in 24-hour out-of-home care.
(d) For the purpose of assessing the fee, parents shall provide income documentation to the department within 30 days of the date the department requested the documentation. Income documentation shall include a copy of a parent’s most recent federal tax return or a copy of each parent’s most recent paystub or employer-provided earnings statement, issued within 60 days of the date the department requested the documentation. A self-employed parent shall document his or her income by providing a copy of his or her most recent federal tax return. A parent without income documentation shall report and certify his or her income on a form provided by the department.
(e) (1) The monthly parental fee for parents who timely submit income documentation or from whom the department does not request income documentation shall be as follows:
(A) Parents who have a family income of 201 percent to 300 percent, inclusive, of the current federal poverty level shall be assessed a monthly fee of 3 percent of their annual gross income, divided by 12.
(B) Parents who have a family income of 301 percent to 400 percent, inclusive, of the current federal poverty level shall be assessed a monthly fee of 4 percent of their annual gross income, divided by 12.
(C) Parents who have a family income of 401 percent to 500 percent, inclusive, of the current federal poverty level shall be assessed a monthly fee of 5 percent of their annual gross income, divided by 12.
(D) Parents who have a family income of 501 percent or more of the current federal poverty level shall be assessed a monthly fee of 6 percent of their annual gross income, divided by 12.
(2) The monthly parental fee for parents who fail to provide income documentation to the department within 30 days of the date the department requested the documentation shall be equivalent to the maximum monthly cost of caring for a child, as determined by the most recent data available from the United States Department of Agriculture’s survey on the cost of raising a child in the west region. However, if parents whose monthly parental fee is calculated pursuant to this paragraph later provide the required income documentation, their monthly parental fee shall be recalculated pursuant to paragraph (1) and retroactively adjusted based on the income information provided.
(3) A monthly parental fee assessed pursuant to this section shall not exceed the maximum monthly cost of caring for a child, as determined by the most recent data available from the United States Department of Agriculture’s survey on the cost of raising a child in the west region, or the cost of the services provided, whichever is less.
(4) A monthly parental fee assessed pursuant to this section shall be recalculated every 12 months, on the date of the original fee assessment, and within 60 days of the date a parent notifies the department of a change in family income or family size and provides updated income documentation, as described in subdivision (d).
(5) Parents of children placed in 24-hour out-of-home care prior to July 1, 2016, shall have their initial monthly parental fee calculated, pursuant to the provisions of this section, at the time of their annual fee recalculation, or within 60 days of a parental request for review by the department and receipt of the family’s completed family financial statement.
(6) The department may grant a temporary waiver from paying the monthly parental fee for parents who substantiate, with receipts, an unavoidable and uninsured catastrophic loss with direct economic impact on the family or significant unreimbursed medical costs associated with care for a child who is a regional center consumer.
(f) Parents who remove their child from 24-hour out-of-home care for a home visit for six or more consecutive hours during a 24-hour period shall be entitled to a credit equal to one day of the monthly parental fee. A credit shall be calculated by multiplying the parents’ monthly parental fee by 12 and dividing that number by the number of days in the year. In order to receive a credit pursuant to this subdivision, parents shall submit a request to the department that is postmarked no later than 60 days after the day for which the credit was earned. Failure to comply with this requirement will result in a denial of the credit by the department.
(g) All fees collected shall be remitted to the State Treasury to be deposited into the Program Development Fund established in Chapter 6 (commencing with Section 4670) to provide resources needed to initiate new programs, consistent with approved priorities for the program development in the state plan, or to be used by the department to offset General Fund costs.
(h) Parents may appeal a determination of the amount of a monthly parental fee or the denial or amount of a credit requested pursuant to subdivision (f) by submitting a written appeal request to the director within 30 days of the date of the monthly parental fee confirmation letter or credit confirmation or denial letter. An appeal pursuant to this subdivision may consider only disputes concerning the family income used to set the monthly parental fee and the denial or amount of credit. The director, or his or her designee shall, within 30 days after receipt of the appeal, review the assessed monthly parental fee or credit denial or amount for accuracy and provide written notice of the decision to the appellant. The director or his or her designee shall, when deciding an appeal of a monthly parental fee, consider the income documentation and the calculation of the monthly parental fee described in subdivision (e). All decisions regarding monthly parental fee appeals shall be retroactive to the date the appealed monthly parental fee was assessed.
(i) This section shall become operative on July 1, 2016.

Summary: Under existing law, the Lanterman Developmental Disabilities Services Act, the State Department of Developmental Services is required to contract with regional centers to provide services and supports to individuals with developmental disabilities and their families. Existing law requires the Director of Developmental Services to establish, annually review, and adjust as needed, a schedule of parental fees to be paid by parents of children under 18 years of age who are receiving 24-hour out-of-home care services through a regional center or who are residents of a state hospital or on leave from the state hospital. Existing law provides that all parental fees collected by or for regional centers are remitted to the State Treasury to be deposited in the Program Development Fund, a continuously appropriated fund. This bill would, effective July 1, 2016, revise and recast those provisions by, among other things, calculating monthly parental fees based on a percentage of the parents’ annual income and authorizing a credit of the equivalent of one day of the monthly parental fee for each day a child spends 6 or more consecutive hours in a 24-hour period on a home visit. The bill would prohibit a monthly parental fee from exceeding the maximum monthly cost of caring for a child or the cost of services provided, whichever is less. The bill would require, for parents of children placed in 24-hour out-of-home care prior to July 1, 2016, the monthly parental fee to be calculated at the time of the parents’ annual fee recalculation, or within 60 days of a parental request for review by the department and receipt of the family’s completed family financial statement. The bill would provide that the Program Development Fund is available upon appropriation by the Legislature and make other related and conforming changes.

An act to amend Section 4677, to amend, repeal, and add Section 4784 of, and to repeal Section 4782 of, the Welfare and Institutions Code, relating to developmental services.


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

SECTION 1.
Section 10203.4 of the Insurance Code is amended to read:
10203.4.
(a) Insurance under a group life insurance policy issued pursuant to Sections 10202, 10202.8, 10203, 10203.1, and 10203.7 may be extended to insure the dependents, or any class or classes thereof, of each insured employee who so elects, in amounts in accordance with some plan that precludes individual selection and that shall not be in excess of 100 percent of the insurance on the life of the insured employee. For dependent children over the age of majority, the group policyholder may elect coverage at age variations up to the limiting age.
(b) “Dependent” includes the member’s spouse or a minor child, as well as a child older than the age of majority up to a maximum of 26 years of age, or any child over the age of majority who is both incapable of self-sustaining employment by reason of an intellectual disability or physical handicap and chiefly dependent upon the employee for support and maintenance if proof of the incapacity and dependency is furnished to the insurer by the employee within 31 days of the child’s attainment of the limiting age and subsequently as may be required by the insurer, but not more frequently than annually after the two-year period following the child’s attainment of the limiting age.
(c) The premiums for the insurance on the dependents may be paid by the employer, the employee, or the employer and the employee jointly.
SEC. 2.
Section 10271.1 of the Insurance Code is amended to read:
10271.1.
(a) (1) Supplemental benefits that operate to safeguard life insurance contracts against lapse are defined as a waiver of premium benefit or a waiver of monthly deduction benefit, as applicable, in which the insurer waives the premium or monthly deduction for a life insurance contract when the insured becomes totally disabled, as defined by the supplemental benefit, and where the waiver continues until the end of the insured’s disability, or for the period specified by the supplemental benefit, consistent with paragraph (5).
(2) For purposes of this subdivision, total disability shall not be less favorable to the insured than the following:
(A) During the first 24 months of total disability, the insured is unable to perform with reasonable continuity the substantial and material duties of his or her job due to sickness or bodily injury.
(B) After the first 24 months of total disability, the insured, due to sickness or bodily injury, is unable to engage with reasonable continuity in any other job in which he or she could reasonably be expected to perform satisfactorily in light of his or her age, education, training, experience, station in life, or physical and mental capacity.
(3) The definition of total disability may also include presumptive total disability, such as the insured’s total and permanent loss of sight of both eyes, hearing of both ears, speech, the use of both hands, both feet, or one hand and one foot.
(4) The insurer may require total disability to continue for an uninterrupted period of time specified by the supplemental benefit, or the insurer may allow separate periods of disability to be combined.
(5) The waiver of premium or monthly deduction benefit shall continue for the period specified by the supplemental benefit, but shall not be less favorable to the insured than the following:
(A) If the insured’s total disability begins before the insured attains 60 years of age, the insurer shall waive all premiums or monthly deductions due for the period that the insured continues to be totally disabled, except as follows:
(i) For group life insurance policies, if the insured’s total disability begins before the insured attains 60 years of age, the insurer shall waive all premiums or monthly deductions due for the period of total disability up to 65 years of age. Nothing in this subdivision shall preclude the insurer from extending a supplemental benefit for longer periods.
(ii) When a renewal is offered for a group life insurance policy that was issued prior to January 1, 2017, and contains a supplemental benefit described in this subparagraph, the insurer shall offer to renew the policy with a continuation of the in-force supplemental benefit, and may concurrently offer the group policyholder the option to change the supplemental benefit as described in clause (i).
(B) If the insured’s total disability begins after the age specified in subparagraph (A), the insurer shall waive all premiums or monthly deductions due for the period that the insured continues to be totally disabled up to 65 years of age, except as follows:
(i) For group life insurance policies, if the insured’s total disability begins on or after the date the insured attains 60 years of age, the insurer is not required to waive premiums or monthly deductions. Nothing in this subdivision shall preclude the insurer from extending a supplemental benefit for longer periods.
(ii) When a renewal is offered for a group life insurance policy that was issued prior to January 1, 2017, and contains a supplemental benefit described in this subparagraph, the insurer shall offer to renew the policy with a continuation of the in-force supplemental benefit, and may concurrently offer the group policyholder the option to change the supplemental benefit as described in clause (i).
(6) In addition to the permissible exclusions listed in subdivision (g) of Section 10271, the insurer may exclude a total disability occurring after the policy anniversary or supplemental contract anniversary, as applicable and as defined by the supplemental benefit, on which the insured attains a specified age of no less than 65 years.
(b) “Special surrender benefit” is defined as a “waiver of surrender charge benefit” wherein the insurer waives the surrender charge usually charged for a withdrawal of funds from the cash value of a life insurance contract or the account value of an annuity contract if the owner, insured, or annuitant, as applicable, meets any of the following criteria:
(1) Develops any medical condition where the owner’s, insured’s, or annuitant’s life expectancy is expected to be less than or equal to a limited period of time that shall not be restricted to a period of less than 12 months or greater than 24 months.
(2) Is receiving, as prescribed by a physician, registered nurse, or licensed social worker, home care or community-based services, as defined in subdivision (a) of Section 10232.9, or is confined in a skilled nursing facility, convalescent nursing home, or extended care facility, which shall not be defined more restrictively than as in the Medicare program, or is confined in a residential care facility or residential care facility for the elderly, as defined in the Health and Safety Code. Out-of-state providers of services shall be defined as comparable in licensure and staffing requirements to California providers.
(3) Has any medical condition that would, in the absence of treatment, result in death within a limited period of time, as defined by the supplemental benefit, but that shall not be restricted to a period of less than six months.
(4) Is totally disabled, as follows:
(A) During the first 24 months of total disability, the owner, insured, or annuitant, as applicable, is unable to perform with reasonable continuity the substantial and material duties of his or her job due to sickness or bodily injury.
(B) After the first 24 months of total disability, the owner, insured, or annuitant, as applicable, due to sickness or bodily injury, is unable to engage with reasonable continuity in any other job in which he or she could reasonably be expected to perform satisfactorily in light of his or her age, education, training, experience, station in life, or physical and mental capacity.
(C) The definition of total disability may also include presumptive total disability, such as the insured’s total and permanent loss of sight of both eyes, hearing of both ears, speech, the use of both hands, both feet, or one hand and one foot.
(D) The insurer may require the total disability to continue for an uninterrupted period of time specified by the supplemental benefit, or the insurer may allow separate periods of disability to be combined.
(5) Has a chronic illness as defined pursuant to either subparagraph (A) or (B):
(A) Either of the following:
(i) Impairment in performing two out of seven activities of daily living, as set forth in subdivisions (a) and (g) of Section 10232.8, meaning the insured needs human assistance, or needs continual substantial supervision.
(ii) The insured has an impairment of cognitive ability, meaning a deterioration or loss of intellectual capacity due to mental illness or disease, including Alzheimer’s disease or related illnesses, that requires continual supervision to protect oneself or others.
(B) Either of the following:
(i) Impairment in performing two out of six activities of daily living as described in subdivisions (b), (d), (e), and (f) of Section 10232.8 due to a loss of functional capacity to perform the activity.
(ii) Impairment of cognitive ability, meaning the insured needs substantial supervision due to severe cognitive impairment, as described in subdivisions (b), (d), and (e) of Section 10232.8.
(6) Has become involuntarily or voluntarily unemployed.
(c) The term “supplemental benefit” means a rider to or provision in a life insurance policy, certificate, or annuity contract that provides a benefit as set forth in subdivision (a) of Section 10271.

Summary: Existing law provides for the regulation of specified insurance products, including group life insurance, by the Insurance Commissioner. Existing law provides that insurance under a group life insurance policy may be extended to insure the dependents of each insured employee under the group policy, as specified. Existing law defines a dependent for these purposes as including the employee’s spouse and all children from birth until 26 years of age, or a child 26 years of age or older who is both incapable of self-sustaining employment by reason of intellectual disability or physical handicap and chiefly dependent upon the employee for support and maintenance, as specified. This bill would clarify that for dependent children over the age of majority the group policyholder would be authorized to elect coverage at age variations up to the limiting age. Existing law defines a waiver of premium benefit or a waiver of monthly deduction benefit under a life insurance contract as a supplemental benefit that operates to safeguard a life insurance contract against lapse when the insured becomes totally disabled, as defined by the supplemental benefit, and continues until the end of the insured’s disability or the period specified by the supplemental benefit, consistent with specified restrictions. Existing law requires, if the insured’s total disability begins before the insured attains 60 years of age, the insurer to waive all premiums or monthly deductions due for the period that the insured continues to be totally disabled. Existing law requires, if the insured’s total disability begins when the insured is 60 years of age or older, the insurer to waive all premiums or monthly deductions due for the period that the insured continues to be totally disabled up to 65 years of age. This bill would require an insurer, for an insured who becomes totally disabled before attaining 60 years of age and is covered by a group life insurance policy that includes a supplemental benefit, to waive all premiums or monthly deductions due for the period of total disability up to the time the insured attains 65 years of age. The bill would also permit an insurer to collect premiums or monthly deductions from an insured who becomes totally disabled on or after 60 years of age and is covered by a group life insurance policy that includes a supplemental benefit. The bill would require an insurer offering a renewal for a group life insurance policy issued prior to January 1, 2017, that contains a supplemental benefit to offer the employer a continuation of the in-force supplemental benefit, and would authorize the insurer to concurrently offer the group policyholder the option to change the supplemental benefit to either waive or collect premiums or monthly deductions as described above.

An act to amend Sections 10203.4 and 10271.1 of the Insurance Code, relating to insurance.


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

SECTION 1.
Section 17406 of the Education Code, as amended by Section 1 of Chapter 408 of the Statutes of 2014, is amended to read:
17406.
(a) (1) Notwithstanding Section 17417, the governing board of a school district, without advertising for bids, may let, for a minimum rental of one dollar ($1) a year, to a person, firm, or corporation real property that belongs to the school district if the instrument by which this property is let requires the lessee therein to construct on the demised premises, or provide for the construction thereon of, a building or buildings for the use of the school district during the term of the lease, and provides that title to that building shall vest in the school district at the expiration of that term. The instrument may provide for the means or methods by which that title shall vest in the school district before the expiration of that term, and shall contain other terms and conditions as the governing board of the school district may deem to be in the best interest of the school district.
(2) For a public project, as defined in subdivision (c) of Section 22002 of the Public Contract Code, regardless of its funding source, an instrument created pursuant to paragraph (1) shall also require that a person, firm, or corporation that constructs the building, including, but not limited to, the prime contractor and, if used, electrical, mechanical, and plumbing subcontractor, shall be subject to the same prequalification requirements for prospective bidders described in subdivisions (b) to (m), inclusive, of Section 20111.6 of the Public Contract Code, including the requirement for the completion and submission of a standardized prequalification questionnaire and financial statement that is verified under oath and is not a public record.
(b) A rental of property that complies with subdivision (a) as it reads on the day that the lease is entered into shall be deemed to have thereby required the payment of adequate consideration for purposes of Section 6 of Article XVI of the California Constitution.
(c) This section shall remain in effect only until January 1, 2019, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2019, deletes or extends that date.
SEC. 2.
Section 17407 of the Education Code, as amended by Section 3 of Chapter 408 of the Statutes of 2014, is amended to read:
17407.
(a) The governing board of a school district may enter into an agreement with a person, firm, or corporation under which that person, firm, or corporation shall construct, or provide for the construction of, a building to be used by the school district upon a designated site and lease the building and site to the school district. The instrument shall provide that the title to the building and site shall vest in the school district at the expiration of the lease, and may provide the means or method by which the title to the building and site shall vest in the school district before the expiration of the lease, and shall contain other terms and conditions as the governing board of the school district deems to be in the best interest of the school district.
(b) The agreement entered into shall be with the lowest responsible bidder who shall give the security that a governing board of a school district requires. The governing board of a school district may reject all bids. For the purpose of securing bids the governing board of a school district shall publish at least once a week for two weeks in a newspaper of general circulation published in the school district, or if there is no newspaper, then in a newspaper of general circulation circulated in the county, a notice calling for bids, stating the proposed terms of the agreement and the time and place where bids will be opened.
(c) For a public project, as defined in subdivision (c) of Section 22002 of the Public Contract Code, regardless of its funding source, an agreement entered into pursuant to subdivision (a) shall also require that a person, firm, or corporation that constructs the building, including, but not limited to, the prime contractor and, if used, electrical, mechanical, and plumbing subcontractor, under this section shall be subject to the same prequalification requirements for prospective bidders described in subdivisions (b) to (m), inclusive, of Section 20111.6 of the Public Contract Code, including the requirement for the completion and submission of a standardized prequalification questionnaire and financial statement that is verified under oath and is not a public record.
(d) This section shall remain in effect only until January 1, 2019, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2019, deletes or extends that date.
SEC. 3.
Section 17407.5 is added to the Education Code, to read:
17407.5.
(a) The governing board of a school district shall not enter into an agreement pursuant to Section 17406 or 17407 with any entity unless the entity provides to the governing board of the school district an enforceable commitment that the entity and its subcontractors at every tier will use a skilled and trained workforce to perform all work on the project or contract that falls within an apprenticeable occupation in the building and construction trades.
(b) For purposes of this section:
(1) “Apprenticeable occupation” means an occupation for which the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations had approved an apprenticeship program pursuant to Section 3075 of the Labor Code before January 1, 2014.
(2) “Chief” means the Chief of the Division of Apprenticeship Standards of the Department of Industrial Relations.
(3) “Skilled and trained workforce” means a workforce that meets all of the following conditions:
(A) All the workers are either skilled journeypersons or apprentices registered in an apprenticeship program approved by the chief.
(B) (i) As of January 1, 2016, at least 30 percent of the skilled journeypersons employed to perform work on the contract or project by the entity and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation that was either approved by the chief pursuant to Section 3075 of the Labor Code or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(ii) As of January 1, 2017, at least 40 percent of the skilled journeypersons employed to perform work on the contract or project by the entity and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation that was either approved by the chief pursuant to Section 3075 of the Labor Code or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(iii) As of January 1, 2018, at least 50 percent of the skilled journeypersons employed to perform work on the contract or project by the entity and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation that was either approved by the chief pursuant to Section 3075 of the Labor Code or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(iv) As of January 1, 2019, at least 60 percent of the skilled journeypersons employed to perform work on the contract or project by the entity and each of its subcontractors at every tier are graduates of an apprenticeship program for the applicable occupation that was either approved by the chief pursuant to Section 3075 of the Labor Code or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(C) For an apprenticeable occupation in which no apprenticeship program had been approved by the chief before January 1, 1995, up to one-half of the graduation percentage requirements of subparagraph (B) may be satisfied by skilled journeypersons who commenced working in the apprenticeable occupation before the chief’s approval of an apprenticeship program for that occupation in the county in which the project is located.
(4) “Skilled journeyperson” means a worker who either:
(A) Graduated from an apprenticeship program for the applicable occupation that was approved by the chief or located outside California and approved for federal purposes pursuant to the apprenticeship regulations adopted by the federal Secretary of Labor.
(B) Has at least as many hours of on-the-job experience in the applicable occupation as would be required to graduate from an apprenticeship program for the applicable occupation that is approved by the chief.
(c) An entity’s commitment that a skilled and trained workforce will be used to perform the project or contract may be established by any of the following:
(1) (A) The entity’s agreement with the governing board of the school district that the entity and its subcontractors at every tier will comply with the requirements of this section and that the entity will provide to the governing board of the school district, on a monthly basis while the project or contract is being performed, a report demonstrating that the entity and its subcontractors are complying with the requirements of this section.
(B) If the entity fails to provide to the governing board of the school district the monthly report pursuant to subparagraph (A), the governing board of the school district shall immediately cease making payments to the entity pursuant to the instrument or agreement described in Section 17406 or 17407.
(C) The monthly report provided to the governing board of the school district pursuant to this paragraph shall be a public record under the California Public Records Act (Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code), and shall be open to public inspection.
(2) If the governing board of a school district has entered into a project labor agreement that will bind all contractors and subcontractors performing work on the project or contract and that includes the requirements of this section, the entity’s agreement that it will become a party to that project labor agreement.
(3) Evidence that the entity has entered into a project labor agreement that includes the requirements of this section and that will bind the entity and all its subcontractors at every tier performing the project or contract.
SEC. 4.
Section 20111.6 of the Public Contract Code is amended to read:
20111.6.
(a) This section shall apply only to public projects, as defined in subdivision (c) of Section 22002, for which the governing board of the district uses funds received pursuant to the Leroy F. Greene School Facilities Act of 1998 (Chapter 12.5 (commencing with Section 17070.10) of Part 10 of Division 1 of Title 1 of the Education Code) or any funds received, including funds reimbursed, from any future state school bond for a public project that involves a projected expenditure of one million dollars ($1,000,000) or more.
(b) If the governing board of the school district enters into a contract meeting the criteria of subdivision (a), then the governing board of the school district shall require that prospective bidders for a construction contract complete and submit to the governing board of the school district a standardized prequalification questionnaire and financial statement. The questionnaire and financial statement shall be verified under oath by the bidder in the manner in which civil pleadings in civil actions are verified. The questionnaires and financial statements shall not be public records and shall not be open to public inspection.
(c) The governing board of the school district shall adopt and apply a uniform system of rating bidders on the basis of the completed questionnaires and financial statements. This system shall also apply to a person, firm, or corporation that constructs a building described in Section 17406 or 17407 of the Education Code.
(d) The questionnaire and financial statement described in subdivision (b), and the uniform system of rating bidders described in subdivision (c), shall cover, at a minimum, the issues covered by the standardized questionnaire and model guidelines for rating bidders developed by the Department of Industrial Relations pursuant to subdivision (a) of Section 20101.
(e) Each prospective bidder shall be furnished by the school district letting the contract with a standardized proposal form that, when completed and executed, shall be submitted as his or her bid. Bids not presented on the forms so furnished shall be disregarded.
(f) A proposal form required pursuant to subdivision (e) shall not be accepted from any person or other entity that is required to submit a completed questionnaire and financial statement for prequalification pursuant to subdivision (b) or from any person or other entity that uses a subcontractor that is required to submit a completed questionnaire and financial statement for prequalification pursuant to subdivision (b), but has not done so at least 10 business days before the date fixed for the public opening of sealed bids or has not been prequalified for at least five business days before that date. The school district may require the completed questionnaire and financial statement for prequalification to be submitted more than 10 business days before the fixed date for the public opening of sealed bids. The school district may also require the prequalification more than five business days before the fixed date.
(g) (1) The governing board of the school district may establish a process for prequalifying prospective bidders pursuant to this section on a quarterly or annual basis and a prequalification pursuant to this process shall be valid for one calendar year following the date of initial prequalification.
(2) The governing board of the school district shall establish a process to prequalify a person, firm, or corporation, including, but not limited to, the prime contractor and, if used, an electrical, mechanical, and plumbing subcontractor, to construct a building described in Section 17406 or 17407 of the Education Code on a quarterly or annual basis. A prequalification pursuant to this process shall be valid for one calendar year following the date of initial prequalification.
(h) This section shall not preclude the governing board of the school district from prequalifying or disqualifying a subcontractor of any specialty classification described in Section 7058 of the Business and Professions Code.
(i) For purposes of this section, bidders shall include both of the following:
(1) A prime contractor, as defined in Section 4113, that is either of the following:
(A) A general engineering contractor described in Section 7056 of the Business and Professions Code.
(B) A general building contractor described in Section 7057 of the Business and Professions Code.
(2) If utilized, each electrical, mechanical, and plumbing contractor, whether as a prime contractor or as a subcontractor, as defined in Section 4113.
(j) If a public project covered by this section includes electrical, mechanical, or plumbing components that will be performed by electrical, mechanical, or plumbing contractors, a list of prequalified general contractors and electrical, mechanical, and plumbing subcontractors shall be made available by the school district to all bidders at least five business days before the dates fixed for the public opening of sealed bids. The school district may require the list to be made available more than five business days before the fixed dates for the public opening of sealed bids.
(k) For purposes of this section, electrical, mechanical, and plumbing subcontractors are contractors licensed pursuant to Section 7058 of the Business and Professions Code, specifically contractors holding C-4, C-7, C-10, C-16, C-20, C-34, C-36, C-38, C-42, C-43, and C-46 licenses, pursuant to regulations of the Contractors’ State License Board.
(l) This section shall not apply to a school district with an average daily attendance of less than 2,500.
(m) (1) This section shall apply only to contracts awarded on or after January 1, 2014.
(2) The amendments made to this section by the act adding this paragraph shall apply only to contracts awarded on or after January 1, 2015.
(n) (1) On or before January 1, 2018, the Director of Industrial Relations shall (A) submit a report to the Legislature evaluating whether, during the years this section has applied to contracts, violations of the Labor Code on school district projects have decreased as compared to the same number of years immediately preceding the enactment of this section, and (B) recommend improvements to the system for prequalifying contractors and subcontractors on school district projects.
(2) A report to be submitted pursuant to this subdivision shall be submitted in compliance with Section 9795 of the Government Code.
(o) This section shall become inoperative on January 1, 2019, and, as of July 1, 2019, is repealed.

Summary: Existing law authorizes the governing board of a school district, without advertising for bids, to lease real property for a minimum rental of $1 per year if the instrument by which this property is leased requires the lessee to construct, or provide for the construction of, a building to be used by the school district and provides that the title to the building shall vest in the school district at the end of the lease. Existing law, until January 1, 2019, also requires the instrument, if funds for the instrument derive from the Leroy F. Greene School Facilities Act of 1998 or from any future state school bond for a public project that involves a projected expenditure of $1,000,000 or more, to provide that the person, firm, or corporation that constructs the building shall comply with specified prequalification requirements. Existing law also authorizes the governing board of a school district to enter into an agreement with the lowest responsible bidder to construct, or provide for the construction of, a building to be leased and used by the school district upon a designated site if the instrument provides that the title to the building and site shall vest in the school district at the end of the lease. Existing law, until January 1, 2019, requires the agreement, if funds for the agreement derive from the Leroy F. Greene School Facilities Act of 1998 or from any future state school bond for a public project that involves a projected expenditure of $1,000,000 or more, to provide that the person, firm, or corporation that constructs the building shall comply with specified prequalification requirements. This bill would, until January 1, 2019, require the instrument and agreement to provide that the person, firm, or corporation that constructs the building to comply with specified prequalification requirements in this context regardless of the funding source for the public project. The bill would require that certain conditions relating to the use of a skilled and trained workforce on the project or contract be satisfied before the governing board of a school district may enter into a contract with any entity for the construction, or for providing for the construction of, a building to be leased or used by the school district. Existing law requires, until January 1, 2019, the governing board of a school district that enters into a contract for a public project, as defined, for which the board uses moneys received pursuant to the Leroy F. Greene School Facilities Act of 1998 or moneys from future state school bonds for a public project that involves a projected expenditure of $1,000,000 or more, to require prospective bidders for a construction contract to complete and submit a standardized prequalification questionnaire and financial statement, as provided. This bill would impose these requirements on a public project if funding for the project includes reimbursement from any future state school bond.

An act to amend Sections 17406 and 17407 of, and to add Section 17407.5 to, the Education Code, and to amend Section 20111.6 of the Public Contract Code, relating to school facilities.


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

SECTION 1.
It is the intent of the Legislature that unencumbered restitution funds awarded to the state from a lawsuit involving Corinthian Colleges, Inc., and its affiliate institutions, including Heald College, shall be used to repay any funds provided to students pursuant to this act.
SEC. 2.
Section 69433.61 is added to the Education Code, to read:
69433.61.
(a) Notwithstanding any other law, a student who was enrolled and received a Cal Grant award in the 2013–14 or 2014–15 academic year at a California campus of Heald College, and was unable to complete an educational program offered by the campus due to the campus’ closure on April 27, 2015, shall not have the award years used at a Heald College campus considered for purposes of the limitation on the number of years of Cal Grant award eligibility. This restoration of award years for Cal Grant eligibility shall not exceed two years.
(b) A student shall be eligible for the restoration of award years if the student was enrolled at a campus of Heald College on April 27, 2015, or withdrew from enrollment between July 1, 2014, and April 27, 2015. The Bureau for Private Postsecondary Education shall provide the commission with information, if available, to confirm student enrollment for purposes of this section.
(c) An eligible student shall, before January 1, 2017, notify the commission of his or her intent to use the restoration of award years provided under this section and to enroll in an institution eligible for initial and renewal Cal Grant awards to be eligible for that restoration.
SEC. 3.
Section 69999.19 is added to the Education Code, to read:
69999.19.
(a) Notwithstanding any other law, a student who was enrolled and received a California National Guard Education Assistance Award in the 2013–14 or 2014–15 academic year at a California campus of Heald College, and was unable to complete an educational program offered by the campus due to the campus’ closure on April 27, 2015, shall not have the award years used at a Heald College campus considered for purposes of the limitation on the number of years of California National Guard Education Assistance Award eligibility. This restoration of award years for California National Guard Education Assistance Award eligibility shall not exceed two years.
(b) A student shall be eligible for the restoration of award years if the student was enrolled at a campus of Heald College on April 27, 2015, or withdrew from enrollment between July 1, 2014, and April 27, 2015. The Bureau for Private Postsecondary Education shall provide the commission with information, if available, to confirm student enrollment for purposes of this section.
(c) An eligible student shall, before January 1, 2017, notify the commission of his or her intent to use the restoration of award years provided under this section and to enroll in an institution eligible for initial and renewal California National Guard Education Assistance Awards to be eligible for that restoration.
SEC. 4.
Section 94051 is added to the Education Code, to read:
94051.
Notwithstanding any provision of law, for a period not to exceed two years from the date of the closure of Corinthian Colleges, Inc., a state agency that provides certification, registration, or licensure necessary to promote the safety and protection of the public may, on a case-by-case basis, consider for certification, registration, or licensure students who were enrolled in a program of Corinthian Colleges, Inc., that provided education or training aimed towards these students receiving certification, registration, or licensure from the state agency, and who did not receive that certification, registration, or licensure due to the closure of Corinthian Colleges, Inc. This consideration shall be provided at the discretion of the state agency in accordance with its public protection mandate and applicable criteria established by the agency for consumer safety.
SEC. 5.
Section 94925 of the Education Code is amended to read:
94925.
(a) The amount in the Student Tuition Recovery Fund shall not exceed thirty million dollars ($30,000,000) at any time.
(b) If the bureau has temporarily stopped collecting the Student Tuition Recovery Fund assessments because the fund has approached the thirty million dollar (30,000,000) limit in subdivision (a), the bureau shall resume collecting Student Tuition Recovery Fund assessments when the fund falls below twenty million dollars ($20,000,000).
(c) An otherwise eligible student who enrolled during a period when institutions were not required to collect Student Tuition Recovery Fund assessments is eligible for Student Tuition Recovery Fund payments despite not having paid any Student Tuition Recovery Fund assessment.
SEC. 6.
Section 94926.5 is added to the Education Code, to read:
94926.5.
(a) The Legislature finds and declares all of the following:
(1) Corinthian Colleges, Inc., has been the target of consumer and taxpayer protection enforcement efforts by the federal government, the Attorney General, and other state and federal authorities.
(2) Based on findings of harm to students enrolled at Corinthian Colleges, Inc., campuses, the United States Department of Education has announced debt relief programs to assist students, including all of the following:
(A) A student who attended a Corinthian Colleges, Inc., campus that closed on April 27, 2015, and withdrew any time after June 20, 2014, is eligible to apply for a closed school loan discharge, so long as the student does not transfer earned credit and subsequently complete a comparable program at another institution.
(B) A student who believes he or she was a victim of fraud or other violations of state law by Corinthian Colleges, Inc., can apply for debt relief under borrower defense to repayment. The United States Department of Education has determined that Corinthian Colleges, Inc., misrepresented job placement rates for a majority of programs at its Heald College campuses between 2010 and 2014 and is in the process of establishing a specific process for federal loan discharge for these Heald students.
(C) A Corinthian student who intends to submit a borrower defense claim may request loan forbearance while a claims review process is established and his or her claim is reviewed.
(3) Pursuant to Section 94923, the Student Tuition Recovery Fund exists to relieve or mitigate a student’s economic loss caused by a documented violation of certain laws or by institutional closure, as specified.
(4) On October 10, 2013, the Attorney General filed a lawsuit against Corinthian Colleges, Inc., for false and predatory advertising, intentional misrepresentations to students, securities fraud, and unlawful use of military seals in advertisements, in violation of the 2007 final judgment of the Los Angeles Superior Court in the People of the State of California v. Corinthian Schools, Inc.
(5) On April 16, 2015, the bureau issued an emergency decision ordering Corinthian Colleges, Inc., to cease enrollment of any new students in all programs at Everest College and WyoTech locations in California effective upon close of business April 23, 2015.
(6) It is consistent with the purpose of the Student Tuition Recovery Fund to provide assistance to Corinthian Colleges, Inc., students to obtain federal and private loan discharge and other financial aid relief.
(b) Upon appropriation by the Legislature, in response to the student harm caused by the practices and unlawful closure of Corinthian Colleges, Inc., grant funds shall be timely provided in accordance with this section to eligible nonprofit community service organizations, to assist the eligible students of that closed institution, including veterans, by relieving or mitigating the economic and educational opportunity loss incurred by eligible students of that institution.
(c) Services provided by eligible nonprofit community services organizations shall include assistance with loan discharge and other student financial aid, veterans education benefits, loan-related relief, and tuition recovery-related claims. Assistance may include, but is not limited to, outreach and education, screening requests for assistance, referring students for additional legal assistance through pro bono referral programs, and legal services.
(d) The terms and conditions of the grant agreements shall ensure that grant funds are used for the exclusive purpose of assisting eligible students with federal and private loan discharge and other financial aid relief, and that students eligible to claim recovery through the Student Tuition Recovery Fund are referred to the bureau for assistance with claim processing.
(e) For purposes of this section, an “eligible nonprofit community service organization” is an organization that satisfies all of the following conditions:
(1) The organization is a 501(c)(3) tax-exempt organization in good standing with the Internal Revenue Service and in compliance with all applicable laws and requirements.
(2) The organization demonstrates expertise in assisting students with, and currently provides free direct legal services to students for, or will work in partnership with or under the supervision of an attorney or a nonprofit legal services organization that has demonstrated expertise in assisting students with, student loan and tuition recovery-related matters.
(3) The organization does not charge students for services, including services provided pursuant to this section.
(f) For purposes of this section, an “eligible student” is a student who was enrolled at a California campus of, or a California student who was enrolled in an online campus of, a Corinthian Colleges, Inc., institution, and who is eligible to apply for debt relief from the United States Department of Education or other student financial aid relief.
(g) (1) The bureau shall notify the Attorney General of all unlawful Corinthian Colleges, Inc., closures within 15 days of the effective date of this section.
(2) The notification shall include the name and location of the school, the programs, and the number of students affected at each site of the school, as appropriate. The bureau shall provide the Attorney General with all additional information that the Attorney General may request, provided that the bureau has access to the requested information.
(3) The Attorney General shall, within 90 days of receipt of the notification, solicit grant applications from eligible nonprofit community service organizations as described in subdivision (e), select one or more of these organizations from among the applicants who are deemed to be qualified by the Attorney General, set additional terms and conditions of the grants as necessary, and notify the bureau and the recipient organization or organizations of the selection and the share of grant funds available that the organization shall receive. The Attorney General may enter into a contract with another qualified entity to perform the Attorney General’s duties under this subdivision.
(h) An eligible nonprofit community service organization that receives funds pursuant to this section shall enter into a grant agreement with the Attorney General, or a qualified entity entrusted with this authority pursuant to paragraph (3) of subdivision (g), as applicable, and shall use grant funds exclusively for the purposes set forth in this section in accordance with the agreement. Any unused funds shall be returned to the Attorney General, for return to the Student Tuition Recovery Fund. The Attorney General, or a contracted qualified entity, may terminate the grant agreement for material breach, and may require repayment of funds provided to the nonprofit community service organization during the time that the agreement was being materially breached. However, the Attorney General, or a qualified entity, shall provide the grantee with written notice of the breach and a reasonable opportunity of not less than 30 days to resolve the breach.
(i) An eligible nonprofit community service organization that receives a grant may give priority to low-income students if demand exceeds available grant funds. Otherwise, the organization may provide assistance regardless of student income level.
(j) (1) An eligible nonprofit community service organization that receives a grant shall report to the Attorney General, or a qualified entity pursuant to paragraph (3) of subdivision (g), as applicable, quarterly through the grant period on all of the following:
(A) The number of eligible students served pursuant to the grant agreement.
(B) A detailed summary of services provided to those students.
(C) The number of Student Tuition Recovery Fund claims referred to the bureau.
(D) The number of federal loan forgiveness claims filed and the number of those claims approved, denied, and pending.
(E) Any other information that is deemed appropriate by the Attorney General or qualified entity, as applicable.
(2) The Attorney General or qualified entity, as applicable, shall make the reports submitted pursuant to paragraph (1) available to the Legislature and the bureau upon request.
(3) The Attorney General or qualified entity, as applicable, shall provide the Legislature and the bureau a final report summarizing the information submitted pursuant to paragraph (1) promptly following the time when all funds are expended by the grantees or by August 1, 2018, whichever is earlier.
(k) Funds shall be distributed to preapproved nonprofit community service organizations as follows:
(1) Fifty percent shall be distributed to the grantee within 30 days of the grantee entering into a grant agreement.
(2) Twenty-five percent shall be distributed to the grantee upon the submission of the grantee’s second quarterly report.
(3) Twenty-five percent shall be distributed to the grantee upon the submission of the grantee’s third quarterly report.
(l) Eligible nonprofit community service organizations may use grant funds received pursuant to this section to pay the costs of assisting eligible students who have been served after the date of closure until June 30, 2018, or until any later date as may be determined necessary by the Attorney General.
(m) The adoption of any regulation pursuant to this section shall be deemed to be an emergency and necessary for the immediate preservation of the public health and safety, or general welfare.
SEC. 7.
(a) The sum of one million three hundred thousand dollars ($1,300,000) is hereby appropriated from the Student Tuition Recovery Fund to the Attorney General for the purposes of providing grants pursuant to Section 94926.5 of the Education Code, and to pay an amount not to exceed one hundred fifty thousand dollars ($150,000) for the reasonable administrative costs of the Attorney General’s office related to these grants.
SEC. 8.
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:
In order to provide immediate educational and economic relief to the thousands of students harmed by the closure of Corinthian Colleges, Inc., it is necessary for this act to take effect immediately.

Summary: The California Private Postsecondary Education Act of 2009 provides for the regulation of private postsecondary educational institutions by the Bureau for Private Postsecondary Education in the Department of Consumer Affairs. The act also establishes the Student Tuition Recovery Fund and requires the bureau to adopt regulations governing the administration and maintenance of the fund, including requirements relating to assessments on students and student claims against the fund, and establishes that the moneys in this fund are continuously appropriated to the bureau for specified purposes. The act caps the amount that may be in the fund at any time at $25,000,000. This bill would raise the cap for the fund to $30,000,000. This bill would appropriate the sum of $1,300,000 from the Student Tuition Recovery Fund to the Attorney General for the purposes of providing grants to eligible nonprofit community service organizations to assist eligible students affected by the closure of Corinthian Colleges, Inc. as defined, with loan discharge and other student loan-related requests and tuition recovery-related claims, and to pay an amount not to exceed $150,000 for the reasonable administrative costs of the Attorney General’s office related to these grants, as specified, thereby making an appropriation. The bill would require the bureau to notify the Attorney General of all unlawful Corinthian Colleges, Inc. closures within 15 days of the effective date of these provisions. The bill would require the Attorney General to, among other things, within 90 days of the notification, solicit grant applications from eligible nonprofit community service organizations, select one or more of these organizations deemed to be qualified, and set additional terms and conditions of the grants as necessary. The bill would set a schedule for how grant funds are to be distributed. The bill would require the grantee to submit specified information to the Attorney General on a quarterly basis, and require the Attorney General to make these reports available to the Legislature and the bureau upon request. The bill would require the Attorney General to provide the Legislature and the bureau a final report summarizing all the information submitted to it by grantees, promptly following the time when all funds are expended by the grantees, or by August, 1, 2018, whichever is earlier. The bill would authorize the Attorney General to contract with another qualified entity to perform the Attorney General’s duties under these provisions. This bill would, for a period not to exceed 2 years from April 27, 2015, authorize state agencies that provide certification, registration, or licensure necessary to promote the safety and protection of the public to, on a case-by-case basis, consider for certification, registration, or licensure students who were enrolled in a program of Corinthian Colleges, Inc. that provided education or training aimed towards these students receiving certification, registration, or licensure from the state agency, and who did not receive that certification, registration, or licensure due to the closure of that institution. The Cal Grant Program prohibits an applicant from receiving Cal Grant awards totaling in excess of the amount equivalent to the award level for a total of four years of full-time attendance in an undergraduate program, except as provided. This bill would partially exempt from this limitation on Cal Grant awards a student who was enrolled and received a Cal Grant award at a California campus of Heald College, and who was unable to complete an educational program offered by the campus due to its closure. The California National Guard Education Assistance Award Program authorizes the renewal of California National Guard Education Assistance Awards, for a maximum of the greater of either four years of full-time equivalent enrollment or the duration for which the qualifying member would otherwise be eligible pursuant to the Cal Grant Program, if specified conditions are met. This bill would partially exempt from this limitation on California National Guard Education Assistance Awards a student who was enrolled and received a California National Guard Education Assistance Award at a California campus of Heald College, and who was unable to complete an educational program offered by the campus due to its closure. This bill would declare that it is to take effect immediately as an urgency statute.

An act to amend Section 94925 of, and to add Sections 69433.61, 69999.19, 94051, and 94926.5 to, the Education Code, relating to higher education, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.