(a) It is the intent of this section to offset the reductions described in Section 12301.02 to the extent that an assessment as described in Section 12301.05 provides General Fund savings. This section shall become operative only upon certification by the State Department of Health Care Services that any necessary federal approvals to implement the assessment referenced in Section 12301.05 have been obtained. This certification shall be provided promptly to the Joint Legislative Budget Committee and the Department of Finance.
(b) Within 30 days after receipt of the certification described in subdivision (a), the Director of Finance shall perform the obligations described in this subdivision for the fiscal year in which the certification is received and for the following fiscal year. Specifically, the Director of Finance shall do the following:
(1) Estimate the total amount of additional funding, less refunds, that will be derived from the assessment for the next fiscal year.
(2) Estimate the amount of the total revenues, if any, that are attributable to any permitted retroactive implementation of the assessment.
(3) Estimate the amount of the total General Fund savings generated by the assessment revenues that remain after taking into account reductions such as the revenues attributable to any retroactive application of the assessment that will be allocated pursuant to Section 12301.04, and any General Fund costs associated with establishment and administration of the assessment. The General Fund costs shall be estimated following consultation with the appropriate budget subcommittees of the Legislature.
(4) Calculate, as a percentage, the amount by which the reduction described in Section 12301.02 is offset by General Fund savings. In making this calculation, the Director of Finance shall estimate the amount of the reduction that may be partially or completely offset. If the estimated General Fund savings from the assessment are less than the amount required to fully offset the reduction pursuant to Section 12301.02, then the percentage offset shall be proportionate to the level of General Fund savings. At no point may the reduction pursuant to Section 12301.02 become negative or go below zero.
(5) Notify the Joint Legislative Budget Committee of the determinations made in paragraphs (1) to (4), inclusive.
(c) On or before May 14, prior to the third fiscal year after the certification described in subdivision (a) is received, the Director of Finance shall perform the activities described in paragraphs (1) to (5), inclusive, of subdivision (b).
(d) Within 10 days of the effective date of any federal change or action that prevents or reduces the amount of General Fund savings received from the assessment, the Director of Health Care Services shall provide a notification to the Joint Legislative Budget Committee and the Director of Finance of that change. Within 30 days of the receipt of this notification, the Director of Finance shall perform the activities described in paragraphs (1) to (5), inclusive, of subdivision (b).
(e) Notwithstanding any provision of Section 12301.02, the reduction of services required by Section 12301.02 shall be mitigated by the percentage offset determined by the Director of Finance in paragraph (4) of subdivision (b).
(f) (1) Any change in the percentage reduction of services as provided in Section 12301.02 shall occur on the first day of the first full month occurring 30 days after the determination provided for in subdivision (b) is made by the Director of Finance.
(2) Any change in the percentage reduction of services as provided in Section 12301.02 due to a determination of the Director of Finance required by subdivision (c) shall occur on July 1 of the fiscal year immediately following the determination.
(3) If a change in the percentage reduction of services as provided in Section 12301.02 is triggered based on a determination of the Director of Finance required by subdivision (d), that change in hours of service shall occur on July 1 after the notification referenced in subdivision (d) from the Director of Health Care Services is received, if the notification is received between the preceding September 30 and January 2. If the notification is received on any other date, then a change in hours shall occur on the first of the month that is nine months after the notification is received.
(g) In preparation of every Governor’s Budget and for every May Revision, the Director of Finance shall perform the obligation described in paragraphs (1) to (3), inclusive, of subdivision (b).
(Added by Stats. 2013, Ch. 4, Sec. 3. (SB 67) Effective May 30, 2013. Conditionally operative as prescribed in subdivision (a).)