STATE OF CALIFORNIA Budget C h a n g e Proposal - C o v e r Sheet DF-46 (REV 08/16)

Fiscal Year Business Unit Department Priority No. 2017-18 5225 California Department of Corrections and 007

Rehabilitation

Budget Request Name Program Subprogram 5225-156-BCP-2017-GB VARIOUS VARIOUS

Budget Request Description Augmentation of Reimbursement Authority

Budget Request Summary The California Department of Corrections and Rehabilitation requests an increase of $51.4 million General Fund reimbursement authority, $6.7 million Inmate Welfare Fund reimbursement authority, and $815,000 Federal Trust Fund in 2017-18 and 2018-19, and $30.0 million General Fund reimbursement authority, $6.7 million Inmate Welfare Fund reimbursement authority, and $815,000 Federal Trust Fund in 2019-20 and ongoing. The additional authority will allow for increased canteen purchasing and allow the California Department of Corrections and Rehabilitation to fully collect all reimbursable expenditures.

Requires Legislation

• Yes Kl No

Code Section(s) to be Added/Amended/Repealed

Does this BCP contain information technology (IT) components? • Yes ^ No

If yes, departmental Chief Information Officer must sign.

Department CIO Date

For IT requests, specify the project number, the most recent project approval document (FSR, SPR, S1BA, S2AA, S3SD, S4PRA), and the approval date.

Project No. Project Approval Document: Approval Date:

If proposal affects another department, does other department concur with proposal? • Yes • No Attach comments of affected department, signed and dated by the department director or designee.

Prepared By Date Reviewed By Date

Daniel Cruz-Roveda Jason Lopez

Department Director Date Agency Secretary Date

Alene Shimazu Scott Kernan Department of Finance Use Only

Additional Review: • Capital Outlay • ITCU • FSCU • OSAE • CALSTARS • Dept. of Technology

BCP Type: • Policy • Workload Budget per Government Code 13308.05

PPBA Original Signed By Clint Kellum

Date submitted to the Legislature

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BCP Title: Augmentation of Reimbursement

Budget Request Summary

Salaries and Wages Earnings - Permanent Overtime/Other

Total Salaries and Wages

Total Personal Services

Operating Expenses and Equipment 5324 - Facilities Operation 539X - Other

Total Operating Expenses and Equipment

Total Budget Request

Fund Summary Fund Source - State Operations

0890 - Federal Trust Fund 0917 - Inmate Welfare Fund 0995 - Reimbursements

Total State Operations Expenditures

Total All Funds

Program Summary Program Funding 4500027 - Internal Affairs 4530010 - General Security 4530028 - General Security Overtime 4540032 - Facility Operations 4540036 - Inmate Employment v i c c o n c c Facilities Planning & Construction 4550055 - ^ g ^ ^

4550067 - Office of Correctional Safety 4595010 - Inmate Activities - Canteen Total All Programs

BCP Fiscal Detail Sheet r BR Name: 5225-156-BCP-2017-GB

FY17 CY BY BY+1 BY+2 BY+3 BY+4

0 1,488 1,488 1,488 1,488 1,488 0 22,560 22,560 17,829 17,829 17,829

$0 $24,048 $24,048 $19,317 $19,317 $19,317

$0 $24,048 $24,048 $19,317 $19,317 $19,317

0 28,206 28,206 11,515 11,515 11,515 0 6,713 6,713 6,713 6,713 6,713

$0 $34,919 $34,919 $18,228 $18,228 $18,228

$0 $58,967 $58,967 $37,545 $37,545 $37,545

0 815 815 815 815 815 0 6,713 6,713 6,713 6,713 6,713 0 51,439 51,439 30,017 30,017 30,017

$0 $58,967 $58,967 $37,545 $37,545 $37,545

$0 $58,967 $58,967 $37,545 $37,545 $37,545

0 15 15 15 15 15 0 5,953 5,953 1,480 1,480 1,480 0 17,947 17,947 17,689 17,689 17,689 0 13,983 13,983 3,857 3,857 3,857 0 7,317 7,317 6,505 6,505 6,505

0 6,906 6,906 1,153 1,153 1,153

0 133 133 133 133 133 0 6,713 6,713 6,713 6,713 6,713

$0 $58,967 $58,967 $37,545 $37,545 $37,545

BCP Title: Augmentation of Reimbursement Authority BR Name: 5225-156-BCP-2017-GB

Personal Services Details

Salaries and Wages

OTOO - Overtime (Eff. 07-01-2017) OTOO - Overtime (Eff. 07-01-2019) VROO - Various (Eff. 07-01-2017)

Total Salaries and Wages

Total Personal Services

CY BY BY+1 BY+2 BY+3 BY+4

0 22,560 22,560 22,560 22,560 22,560 0 0 0 -4,731 -4,731 -4,731 0 1,488 1,488 1,488 1,488 1,488

$0 $24,048 $24,048 $19,317 $19,317 $19,317

$0 $24,048 $24,048 $19,317 $19,317 $19,317

Analysis of Problem

A. Budget Request Summary

The California Department of Corrections and Rehabilitation (CDCR) requests an increase of $51.4 million General Fund (GF) reimbursement authority, $6.7 million Inmate Welfare Fund (IWF) reimbursement authority, and $815,000 Federal Trust Fund (FTF) in fiscal year 2017-18 and 2018-19, and $30.0 million GF reimbursement authority, 6.7 million IWF reimbursement authority, and $815,000 FTF in 2019-20 and ongoing. The additional authority will allow for increased canteen purchasing and allow the California Department of Corrections and Rehabilitation to fully collect all reimbursable expenditures. The additional GF reimbursement authority will ensure that CDCR can fully utilize the Health Care Facility Improvement Program (HCFIP), and California Department of Forestry and Fire Protection (CAL FIRE) expense reimbursements. The additional IWF authority will ensure that sufficient items are purchased in the canteen. The additional FTF authority will allow CDCR to fully utilize the California Office of Emergency Services (CAL-OES) and Federal Bureau of Investigation (FBI) federal reimbursements for services provided to federal entities. GF and FTF reimbursable authority is required for CDCR to fully collect all reimbursable expenditures.

B. Background/History _

CDCR provides services to various entities and is reimbursed for those services. Due to variations of the services provided each year to these entities, it has been determined that an augmentation to CDCR's GF and FTF reimbursable authority is required.

IWF was created in 1945 as a special trust fund for the benefit, education, and welfare of the inmates. IWF is a self-supporting fund totally dependent upon its generated revenues to provide inmates with activities and programs such as the canteen and photo project. IWF's sources of revenue include movie rentals, entertainment, handcraft materials and equipment, library books, and the canteen. Inmates can purchase from any of these sources using the Inmate Trust Fund; this fund solely consists of inmates' personal funds received from family, friends, and from job assignments within the prison.

Assembly Bill (AB) 1468 authorizes CDCR to utilize AB 900 funds for capital outlay to design and construct projects such as medical, dental, mental health treatment, and housing spaces in HCFIP at state prison facilities. AB 1468 entered CDCR and the State Public Works Board into a construction agreement in order to acquire, design, and construct a local jail facility, as specified, using the proceeds of revenue bonds, notes, and bond anticipation notes. AB 900 provides resources to improve public safety by reducing the rates at which inmates re-victimize communities and return to prison. HCFIP projects improve the physical plant infrastructure, to complement the medical classification system, and improve the provision of outpatient medical care to the inmate population. As of 2015, 23 of the 31 prison-specific HCFIP projects are in the construction phase. Each project contains multiple sub-projects; activation of improvements at each prison will occur on a phased basis as construction is completed on each sub-project. The first sub-projects, consisting of medication preparation and distribution rooms at several prisons, were completed and activated in 2015. The planned improvements primarily focus on providing exam rooms and other clinical spaces with appropriate confidentiality as prescribed by the Federal Health Insurance Portability and Accountability Act, adequate infection control systems, and medication distribution facilities.

The Conservation Camp Program, established in 1946, is one of the most successful collaborations in California's history. The California Department of Forestry and Fire Protection (CAL FIRE) and CDCR jointly operate 39 of the 44 Conservation Camps statewide that house approximately 4,400 adult inmates and Division of Juvenile Justice wards. There are approximately 200 fire crews serving California year round under this system. These crews are available to respond to all types of emergencies including wildfires, floods, search and rescue operations, and earthquakes. When not responding to emergencies, the crews are busy with conservation and community service work projects for state, federal, and local government agencies. On average. Conservation Camp crews perform seven million hours on community service work projects, and three million hours of firefighting and emergency response each year.

Analysis of Problem

The Water Conservation Grant awarded by the Department of General Services (DGS) was implemented by Governor Brown in January 17, 2014. Due to the current drought the Governor issued a "Drought State of Emergency Proclamation" that called for an immediate 20 percent reduction in water usage. CDCR has been proactive in its approach to reduce water usage by establishing long-term goals for addressing infrastructure issues. CDCR has implemented numerous projects to replace hydronic loops, steam pipes, toilets, and showerheads.

California Prison Industry Authority (CALPIA) work programs reimburse victims, save taxpayer dollars, and manufacture quality products throughout the state. CALPIA is a self-supporting, customer focused business that provides productive work, training, and skill development opportunities which help reduce the recidivism of CDCR inmates. CALPIA provides numerous job training skills inside the prisons like eyeglass and lens manufacturing, dairy operations, egg production, laundry services, textile manufacturing, bakery, shoe manufacturing, dental laboratory, printing services, crops farming, and metal production.

Cities/Counties/Districts (C/C/Ds) provides funding for guarding services to the Office of Internal Affairs (OIA), Los Angeles County Fire, CAL FIRE, and the Office of Correctional Safety. Program 4530 uses C/C/Ds GF reimbursement authority to provide guarding for Los Angeles County Fire, Fire Camp Beds, and various cities for municipal clean up.

The Office of Correctional Safety's (OCS's) mission is to protect the public and serve CDCR investigative and security interests. The OCS is the primary departmental link with allied law enforcement agencies and the CAL-OES. CAL-OES is responsible for the coordination of overall state agency response to disasters and offers guidance to emergency managers, planners, and older adult service systems for planning and responding during disasters and recovery. CAL-OES is also accountable for traveling to each facility throughout the state to initiate training sessions, live exercises, and educational seminars in a wide variety of emergency management areas. Cal-OES reimburses CDCR for providing necessary emergency equipment and personnel needed to fight wildfire conditions and other emergencies.

OIA has Special Agents assigned to an FBI Task Force that investigates allegations of child exploitation. These investigations include interviews, forensic analysis, surveillance, and serving of search and/or arrest warrants.

C. State Level Considerations

Increasing IWF authority fits CDCR's current mission to lower recidivism by increasing educational opportunities for inmates. CALPIA also creates developmental opportunities for inmates by offering numerous job training skills that can be used once an inmate is released. The various programs that IWF and CALPIA offer are a positive influence for offenders to successfully reintegrate into our communities. Increasing HCFIP GF reimbursement authority will ensure that CDCR can provide a safe and secure incarceration of offenders. The HCFIP project will ensure that each facility has sufficient infrastructure improvements to provide an acute level of medical care to the inmate population. The Water Conservation Grant supports the Administrations 2014 Green Action Plan to reduce water usage by 10 percent by 2015 and 20 percent by 2020. The Green Action Plan has empowered CDCR to work with local water suppliers on conservation efforts necessary to achieve these goals.

D. Justification

Based on prior year collections, CDCR anticipates it will not be able to collect all available reimbursable expenditures with its current authority. The additional IWF authority request is driven by an increase in the cost of items purchased for resale and is directly related to increasing canteen sales. This request will be at no cost to the GF since IWF is completely dependent on revenues generated from inmate funds. This augmentation will allow IWF to have sufficient budget authority to cover its expenditures and operate at its fullest capacity.

Analysis of Problem

The additional CAL FIRE and Los Angeles County Fire GF reimbursement authority request correlates with the current drought crisis in California. With rain levels at an all-time low, the state is more prone to wildfires throughout the year increasing the workload for the Conservation Camp crews located statewide. The need for C/C/Ds GF reimbursement authority has also increased due to the increased amount of Fire Camp Beds needed to operate the state fire camps.

The additional HCFIP GF authority will allow CDCR to improve the treatment and clinic space at existing prison facilities. On January 13, 2014 the Public Works Board approved the scope, cost, and schedule for the HCFIP projects. These physical plant improvements to the infrastructure will develop the provision of outpatient medical care to the inmate population. As projects are completed in 2018-19 in accordance with the 2015 Master Plan, the requested authority for HCFIP is reduced in 2019-20 and ongoing.

In addition to the CAL FIRE reimbursements, CDCR receives federal funds from CAL-OES for providing emergency equipment and personnel necessary to fight wildfire conditions and other emergencies. CDCR requires an augmentation to its federal authority to receive these funds. This request is consistent with a budget revision submitted in 2015-16.

The Water Conservation Grant correlates with rain levels being at an all-time low and the need to reduce our water usage. CDCR's Green Action Plan established long-term goals for addressing infrastructure issues. CDCR has implemented numerous projects to replace hydronic loops, steam pipes, toilets, and showerheads to reduce water usage throughout its facilities.

OlA's special agents provide assistance to an FBI Task Force for allegations of child exploitation. CDCR requires an augmentation to its federal fund authority as it was unable to receive the full amount of federal funds due to the lack of federal fund authority in its budget.

Outcomes and Accountability

Projected outcomes for augmenting IWF authority, GF reimbursement authority, and FTF authority: • IWF will have sufficient budget authority to cover the increase in purchasable items. • GF reimbursement authority and FTF authority will be fully used. • CDCR will not have to submit yearly Budget Revisions to update GF reimbursement authority

and FTF authority. • Additional funding from the GF will not be needed if GF reimbursement authority and FTF

authority are increased. • These augmentations fall in line with CDCR's scope and mission.

Analysis of Aii Feasible Alternatives

Alternative 1: Approve the request for $6,713,000 in Inmate Welfare Fund authority, $51,439,000 GF reimbursement authority, and $815,000 FTF authority for 2017-18 and ongoing.

Pros: • IWF will have enough authority to keep pace with the increase in canteen purchases and

operate at its fullest capacity. • CDCR will be able to fully utilize their GF reimbursement authority and FTF authority. • Additional funding from the GF will not be needed if GF reimbursement authority and FTF

authority are not increased.

Cons: • The need for this additional GF reimbursement authority and FTF authority could go down

within the next few years due to unpredicted fluctuations in the fire seasons.

Analysis of Problem

Aiternative 2: Continue to submit Budget Revisions on a yearly basis to increase GF reimbursement authority and FTF authority. Approve the increase to IWF authority.

IWF will have enough authority to keep pace with the increase in canteen purchases and operate at its fullest capacity. CDCR will be able to fully utilize their GF reimbursement authority and FTF authority. Additional funding from the GF will not be needed if GF reimbursement authority and FTF authority are not increased. CDCR will capture any fluctuations in GF reimbursement authority and FTF authority on a yearly basis.

Cons: • CDCR will not display the true GF reimbursement authority and FTF authority needed in

documents published at the beginning of the year. • CDCR will have to submit Control Section 1.5 and Control Section 28.00 budget revisions to

increase current year budget authority on a yearly basis.

Alternative 3:

Only increase the IWF authority, GF reimbursement authority, and FTF authority for three years.

Pros: • IWF will have enough authority to keep pace with the increase in canteen purchases and

operate at its fullest capacity. • CDCR will be able to fully utilize their GF reimbursement authority and FTF authority. • Additional funding from the GF will not be needed if GF reimbursement authority and FTF

authority begin to decrease. • CDCR will be able to revisit this issue in three years and capture any fluctuations in GF

reimbursement authority and FTF authority. Cons:

• CDCR will have to recalculate the need in GF reimbursement authority, IWF authority, and FTF authority in three years.

• Increasing authority for three years does not solve the issue for the long term if the need remains constant.

Alternative 4:

Do not increase IWF authority, GF reimbursement authority, or FTF authority.

Pros: • CDCR will continue to operate their budget with the same IWF authority, GF reimbursement

authority, and FTF authority. Cons:

• IWF will not have enough authority to operate to its full capacity. • CDCR will not show the true GF reimbursement authority and FTF authority needed. • CDCR will use GF authority if GF reimbursement authority and FTF authority are not

increased.

Pros:

Analysis of Problem

Implementation Plan

The following items should be approved for funding in 2017-18:

The IWF request for $6,713,000. The HCFIP request for $21,421,000. The AB900 request for $1,385,000. The CAL FIRE request for $22,918,000. ' The LA County Fire request for $1,443,000. The CALPIA request for $1,630,000. The DGS Water Conservation request for $1,154,000. The C/C/Ds request for $1,355,000. The request for $15,000 additional FTF authority related to services provided to the FBI. The CAL-OES request for an additional $133,000 GF reimbursement authority and $800,000 FTF authority.

Supplemental Information

None

Recommendation

Alternative 1 should be approved.

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