The 2016-17 Budget: Fiscal Impacts of Proposition 47

The 2016-17 Budget: Fiscal Impacts of Proposition 47 MAC TAYLOR • L E G I S L A T I V E A N A L Y S T • FEBRUARY 2016 2016-17 BUDGET 2 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET EXECUTIVE SUMMARY Proposition 47 Requires State Savings Be Spent on Specified Programs. Proposition 47, which was approved by voters in November 2014, made significant changes to the state’s criminal justice system. Specifically, it reduced the penalties for certain non-violent, nonserious drug and property crimes and requires that the resulting state savings be deposited into a new special fund, the Safe Neighborhoods and Schools Fund (SNSF), to be spent on mental health and substance use services, truancy and dropout prevention, and victim services. Proposition 47 requires the Department of Finance to annually estimate savings to the state resulting from the measure in the preceding fiscal year and that an equivalent amount from the General Fund be deposited into the SNSF. The measure requires the first deposit to be made in July 2016 based on the level of savings created in 2015-16. Framework for Meeting Fiscal Requirements. In order to assist the Legislature, we provide a general framework for how we believe (1) the amount of the SNSF deposit should be determined and (2) how program budgets should be adjusted to pay for the deposit. We find that the most reasonable method to determine the amount of the annual SNSF deposit is to estimate the total amount of savings that resulted from the proposition in the prior fiscal year minus any increased costs resulting from implementing the measure in that year. To pay for the deposit, we recommend that the Legislature (1) reduce program budgets to account for total savings and (2) augment program budgets to account for increased costs. This is because our recommended framework is based on a key principle that the overall intent of the measure was to have no net impact on state expenditures. How Much Money Should Be Deposited to SNSF in 2016-17. Based on its estimates of the savings and costs resulting from the implementation of Proposition 47, the administration currently estimates that it will deposit $29.3 million from the General Fund into the SNSF for expenditure in 2016-17. We find that the administration likely underestimates the savings and overestimates the costs resulting from the measure. For example, we estimate that the actual level of prison savings due to Proposition 47 could be $83 million higher compared to the administration’s estimate. Overall, we estimate that the SNSF deposit in 2016-17 could be around $100 million higher than the administration’s figure. How to Pay for SNSF Deposit in 2016-17. The administration proposes to allow both the state courts and the Department of State Hospitals (DSH) to keep savings they are estimated to realize as a result of Proposition 47. We find that this would reduce legislative oversight by allowing these agencies to redirect their savings to other programs and services without legislative review or approval. We recommend that the Legislature reduce the budgets for the courts and DSH to account for the savings resulting from this measure. Allocation of Funds Deposited Into SNSF. Under the measure, funds deposited in the SNSF are required to be annually allocated as follows: (1) 65 percent for the Board of State and Community Corrections (BSCC) to support mental health and substance use services, (2) 25 percent for the California Department of Education (CDE) to support truancy and dropout prevention, and (3) 10 percent for the Victim Compensation and Government Claims Board (VCGCB) for grants to trauma recovery centers (TRCs). We find that the administration’s proposal to allocate the funds www.lao.ca.gov Legislative Analyst’s Office 3 2016-17 BUDGET provided to BSCC based on recently passed legislation to be reasonable. In addition, we recommend that the funds provided to CDE be allocated to schools with the highest concentrations of at-risk students and that schools be given flexibility in deciding how to best use the funds. Finally, we also recommend that the VCGCB be given more guidance on how to manage the grants to TRCs. Specifically, we recommend that the Legislature (1) structure the grants to ensure the funds are spent in an effective manner, (2) ensure that the state receives federal reimbursement funds for all eligible services provided by TRCs, (3) expand TRCs to additional regions of the state, and (4) evaluate grant recipients based on outcomes. 4 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET INTRODUCTION Proposition 47, which was approved by voters major effects of Proposition 47 on the state, in November 2014, made significant changes to (2) recommend a framework for satisfying the the state’s criminal justice system. Specifically, measure’s requirement that the state savings it it reduced the penalties for certain non-violent, creates be deposited into a new special fund, nonserious drug and property crimes and requires and (3) describe and assess the administration’s that the resulting state savings be spent on mental approach for meeting the measure’s fiscal health and substance use services, truancy and requirements, including the allocation of the dropout prevention, and victim services. In monies deposited in the new fund. this report, we (1) provide an overview of the OVERVIEW OF PROPOSITION 47 Measure Impacts Various State Entities. • State Courts. The measure creates Proposition 47 reduced certain nonserious and a temporary increase in court costs non-violent property and drug offenses from resulting from workload associated with wobblers or felonies to misdemeanors. (Wobblers (1) resentencing offenders who were serving are crimes that can be charged as either a felony sentences for crimes reduced from felonies or a misdemeanor.) The implementation of to misdemeanors under the measure and the measure has impacted the workload of the (2) reclassifying the convictions of such following state entities: offenders who have already completed their sentences. However, the above • California Department of Corrections costs to the courts have been partly and Rehabilitation (CDCR). The measure offset by savings from the conversion of made two changes that reduced the state felonies to misdemeanors. This is because prison population and associated costs. misdemeanors generally take less court First, changing crimes from felonies and time to process than felonies. Once the wobblers to misdemeanors made fewer resentencing and reclassification workload offenders eligible for state prison sentences. is complete, courts should experience Second, the measure allowed for the ongoing savings from the conversion of resentencing of inmates currently in state felonies to misdemeanors. prison for crimes reduced from felonies to misdemeanors under the measure. In • Department of State Hospitals (DSH). The addition, the resentencing of individuals measure reduces DSH costs by decreasing who were in state prison has temporarily the number of commitments to state increased the state parole population. hospitals. This decrease has been primarily This is because the measure required that due to fewer individuals accused of felonies resentenced inmates generally be placed on being committed to state hospitals as a state parole supervision for a year. result of being deemed incompetent to www.lao.ca.gov Legislative Analyst’s Office 5 2016-17 BUDGET stand trial (IST). This is because counties on the level of savings created in 2015-16. The are generally responsible for treating IST funds deposited in the SNSF are continuously individuals accused of misdemeanors, appropriated and are required to be annually including those whose crimes were reduced allocated as follows: (1) 65 percent for the Board from felonies to misdemeanors by the of State and Community Corrections (BSCC) measure. for grants to public agencies to support various recidivism reduction programs, (2) 25 percent for Amount of Annual Savings Deposited in New the California Department of Education (CDE) for Special Fund. Proposition 47 also requires (1) the grants to support truancy and dropout prevention Department of Finance (DOF) to annually estimate programs, and (3) 10 percent for the Victim savings to the state resulting from the measure Compensation and Government Claims Board in the preceding fiscal year and (2) the State (VCGCB) for grants to trauma recovery centers Controller to deposit an equivalent amount from (TRCs). Under the measure, up to 5 percent of the the General Fund into the Safe Neighborhoods funds allocated for each of the above purposes and Schools Fund (SNSF). The measure requires could be used for administration. the first deposit to be made in July 2016 based FRAMEWORK FOR MEETING FISCAL REQUIREMENTS No Net Impact on State Expenditures. Given reasonable method to determine this amount is to that Proposition 47 does not lay out a detailed estimate the total amount of savings that resulted process for how the state must estimate and pay for from the proposition in the prior fiscal year minus the deposit into the SNSF, there essentially is no any increased costs resulting from implementing one “correct” way to meet the proposition’s fiscal the measure in that year. The difference between requirements. In order to assist the Legislature, the total savings and total costs should then be we provide below a general framework for how deposited in the SNSF. we believe (1) the amount of the deposit should Budget Savings and Costs Separately. To be determined and (2) how program budgets pay for the deposit in a way that results in no net should be adjusted to pay for the deposit. Our impact on the General Fund and provides the recommended framework is based on a key greatest transparency, we recommend that the principle that the overall intent of the measure Legislature do the following: was to have no net impact on state expenditures. • Reduce Program Budgets to Account In other words, after accounting for all of the state for Total Savings. As indicated earlier, savings and costs from the measure (including CDCR, state courts, and DSH experienced the SNSF deposit), it should neither increase nor a reduction of workload as a result of the decrease state expenditures. implementation of Proposition 47. We Account for All Costs and Savings recommend that the Legislature reduce Within Each Fiscal Year. As discussed above, the program budgets of these entities to Proposition 47 requires that the annual deposit account for savings associated with the to the SNSF be based on the level of state savings reduced workload. In some cases, the in the prior fiscal year. We find that the most Legislature will not need to take a specific 6 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET action because the existing budgeting specific augmentations to those state methodology for the program results in entities that experience increased costs. In adjustments to the program’s budget to some cases, the Legislature will not need to account for decreased workload, as is the take a specific action because the existing case with CDCR prison operations. In budgeting methodology results in automatic other cases, the Legislature would need to adjustments to the program’s budget to take action as part of the budget process to account for the increased workload, as is the reduce specific appropriations. case with CDCR parole operations. In other cases, the Legislature will want to take • Augment Program Budgets to Account action to increase specific appropriations. for Increased Costs. The implementation Based on this framework, we assess the of Proposition 47 has also increased some administration’s plan for 2016-17. As we discuss workload for state entities. For example, below, the administration has taken a different the measure requires courts to process approach in several areas than what we recommend resentencing and reclassification hearings. above. We recommend that the Legislature provide HOW MUCH MONEY SHOULD BE DEPOSITED TO SNSF IN 2016-17? Currently, the administration estimates that measure in the fiscal year in which they occur, as $29.3 million from the General Fund would we recommend as part of our proposed framework be deposited into the SNSF on July 31, 2016 for above. expenditure in 2016-17, based on its estimates of the savings and costs resulting Figure 1 from the implementation Administration’s Estimate of Proposition 47’s of Proposition 47. These Fiscal Effects in 2015-16 estimates are summarized (In Millions) in Figure 1, which we Amount Department discuss and assess in detail below. Overall, we find Savings Inmate population reduction -$52.2 CDCR that the administration Patient population reduction -8.7 DSH likely underestimates the Reduced criminal caseload -1.7 Judicial branch savings and overestimates Total Savings -$62.7 Costs the costs resulting from Parole population increase $6.5 CDCR the proposition. In Resentencing costs 26.9 Judicial branch addition, we find that Total Costs $33.4 the administration did Net Savings—SNSF Deposit -$29.3 not account for all costs CDCR = California Department of Corrections and Rehabilitation; DSH = Department of State Hospitals; and SNSF = Safe Neighborhoods and Schools Fund. and savings from the www.lao.ca.gov Legislative Analyst’s Office 7 2016-17 BUDGET Estimated Total Savings that the administration needed to make in for 2015-16 order to estimate the prison savings from the population reduction is how much CDCR saved Administration’s Estimates in 2015-16 from housing fewer inmates in state prisons and in contract beds. The administration The administration estimates a total of assumes that the department was able to reduce $62.7 million in savings from the implementation the number of contract beds by about 400 due of Proposition 47 in 2015-16. These savings consist to Proposition 47 and that the balance of the of the following: population reductions from the measure—about • Prison Savings—$52.2 Million. 4,300 inmates—resulted in a reduction in the The administration estimates that inmate population in the state’s 34 prisons. In other Proposition 47 will reduce the average words, the administration’s approach implies that, number of state prison inmates in 2015-16 had Proposition 47 not passed, CDCR would have by about 4,700 for a total savings of otherwise accommodated the 4,700 inmates in about $52 million. This total consists of 2015-16 by placing (1) 400 inmates in contract beds $39 million in savings from a reduction and (2) 4,300 inmates in the state’s prisons. in inmates housed in state prisons and While we acknowledge that it is impossible to $13 million in savings from a reduction in know precisely how many contract beds CDCR inmates housed in contract beds. would be using in 2015-16 had Proposition 47 not passed, we find that the administration’s • DSH Savings—$8.7 Million. The assumptions are unrealistic. This is because CDCR administration estimates that is currently housing just 900 inmates less than Proposition 47 will reduce the average the federal court-ordered limit on the prison number of patients in its hospitals in population. (In recent years, the state has been 2015-16 by 73, resulting in savings of under a federal court order to reduce overcrowding $8.7 million. in CDCR’s 34 prisons. Specifically, the court • Court Savings—$1.7 Million. The found that prison overcrowding was the primary administration estimates that the courts reason the state was unable to provide inmates will have a reduction of 6,000 criminal with constitutionally adequate health care and cases in 2015-16 because of Proposition 47, ordered the state to reduce its prison population to resulting in savings of $1.7 million. 137.5 percent of design capacity.) As such, adding 4,300 inmates to the state’s prisons would have LAO Comments resulted in the state exceeding the population cap by 3,400 inmates. In our view, it is more realistic Prison Savings Likely Underestimated. The to assume that had Proposition 47 not passed, administration’s estimate that Proposition 47 CDCR would have attempted to maintain a similar will reduce the number of state inmates by about population level in the state prisons—along with a 4,700 in 2015-16 appears reasonable. However, similar cushion below the population limit—and our analysis indicates that the administration has thus accommodated the additional inmates by underestimated the savings associated with this contracting out for an additional 4,700 beds. In inmate population reduction. One key assumption other words, we estimate that Proposition 47 8 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET allowed CDCR to avoid the need for 4,700 contract Recommend Judicial Branch Provide Updated beds in 2015-16. This alternative assumption Calculation of Savings. While we acknowledge yields a prison savings estimate for 2015-16 that that average case processing times for felonies is $83 million higher than the administration’s and misdemeanors specific to Proposition 47 may estimate—bringing total prison savings to not exist, the judicial branch can use the data $135 million. underlying their existing workload studies, as Court Savings Likely Underestimated. well as data collected from trial courts, to provide By reducing certain offenses from felonies to estimates of average case processing times for these misdemeanors, Proposition 47 results in cases filings. We believe this is a more reasonable method being filed as misdemeanors in the courts rather for calculating the savings generated from cases than as felonies. To estimate how this would affect being filed as misdemeanors instead of felonies. the courts, the administration made two key Accordingly, in order to obtain a more accurate assumptions. First, the administration projected understanding of Proposition 47 impacts on trial that 80,000 fewer felony cases would be filed and court workload, we recommend the Legislature 74,000 additional misdemeanor cases would be direct the judicial branch to provide an updated filed, resulting in an total decrease of 6,000 cases in calculation of savings by April 1. Specifically, 2015-16. (Fewer overall cases would be filed to the the judicial branch should recalculate estimated extent locals choose not to pursue misdemeanor savings by using adjusted average case processing charges for cases that would have been previously times for felonies and misdemeanors to account charged as felonies.) Second, the administration for differences in the staffing resources needed assumed that these misdemeanor cases would to process these different case types. We also take the same amount of time to process as they recommend that the Legislature direct the judicial would have if they were felony cases. As a result branch to report the level of savings experienced the administration’s estimate of $1.7 million in due to Proposition 47 separately for 2014-15 and savings is due solely to their projection that 6,000 2015-16. fewer cases will be filed and does not reflect any Estimated Total Costs savings in workload from converting a felony case for 2015-16 to a misdemeanor case. We note, however, that the judicial branch’s existing workload studies show Administration’s Estimates that misdemeanors take significantly less time on average to process than felonies. Specifically, felony The administration estimates a total of cases require approximately six times more judicial $33.4 million in increased costs from the time and approximately three times more staff time implementation of Proposition 47 in 2015-16. As we than misdemeanor cases. We acknowledge that these describe below, these costs are related to increased averages may not apply directly to Proposition 47 parole caseloads and court workload. cases as these cases represent the least serious felony • Parole Costs—$6.5 Million. The cases and the most serious misdemeanor cases. administration estimates that the average However, the administration has not accounted for number of parolees in 2015-16 will increase any cost difference between these cases. Thus, it is by about 1,700 due to individuals being likely that the administration’s court savings are resentenced and placed on state parole for underestimated—potentially by $10 million or more. www.lao.ca.gov Legislative Analyst’s Office 9 2016-17 BUDGET a year under the measure, resulting in costs costs ($14 million), as well as reclassification of $6.5 million. workload that occurred in 2014-15 ($7 million). As we believe that all costs incurred within a given • Court Costs—$26.9 Million. As shown year should be accounted for, it is inappropriate earlier in Figure 1, the administration’s to exclude the above $14 million costs from the estimates regarding the deposit to the SNSF estimate of 2015-16 court costs. in 2016-17 assumes $26.9 million in court Likely Overestimates Court Costs Related to costs. This amount simply reflects the total Reclassifications. The administration assumes that amount that was provided to courts in the courts require the same level of resources to process 2015-16 budget for increased Proposition 47 resentencing and reclassification cases. However, workload related to resentencing. As we preliminary data collected by the judicial branch discuss in more detail below, this amount suggests that it costs less to process reclassifications. includes costs related to 2014-15, as well as Accordingly, it is likely that the $14 million request excludes other workload costs in 2015-16 for funding for these hearings is overstated. resulting from the measure for which the On Net, Administration’s Estimate Likely Governor is proposing to fund as part of Overstates Court Costs. After adjusting for the his proposed budget for 2016-17. various concerns raised above, we estimate that the actual level of costs incurred by the courts LAO Comments in 2015-16 due to Proposition 47 is lower than Includes Court Costs Incurred in 2014-15. Of the administration’s estimate of $26.9 million. the $26.9 million in court costs identified by the Specifically, we estimate that actual costs could be administration, our analysis finds that $25 million lower by at least $10 million. In order to obtain a is for workload associated with resentencing more accurate understanding of Proposition 47 hearings that occurred in 2014-15. As noted impacts on trial court workload, we recommend previously, we believe that a more reasonable way that the Legislature direct the judicial branch to to calculate net savings in a given fiscal year is to recalculate estimated costs by using actual data on account for all costs and savings incurred within the time and resources needed for reclassification that year. Thus, it is inappropriate to include and resentencing workload by April 1. We also 2014-15 costs in estimating the costs resulting from recommend the Legislature direct the judicial the implementation of the proposition in 2015-16. branch to report the level of costs incurred due to Excludes Some Court Costs Incurred in Proposition 47 separately for 2014-15 and 2015-16. 2015-16. We also find that the administration’s Recommend Withhold Action on 2016-17 $26.9 million cost estimate for the courts does Request for Additional Funding. Given our not include costs for some workload occurring concerns with how the administration and in 2015-16. Specifically, the estimate excludes judicial branch calculated Proposition 47 costs, we $2 million in additional resentencing workload recommend the Legislature withhold action on the costs and $12 million in reclassification workload Governor’s proposal to provide the judicial branch costs, for a total of $14 million. We note that the with $21 million in additional General Fund Governor’s budget proposes a $21 million General support in 2016-17 pending the receipt of revised Fund augmentation to the courts to support these cost information. 10 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET Estimated SNSF $100 million higher than the administration’s Deposit in 2015-16 estimate. While the administration’s approach would benefit the General Fund from a lower Based on its estimates of the savings and deposit to the SNSF, it does so at the expense of costs resulting from the implementation of the programs that receive funding from the SNSF. Proposition 47, the administration currently As previously indicated, the overall intent of the estimates that $29.3 million from the General Fund proposition was to have no net impact on state would be deposited into the SNSF on July 31, 2016 expenditures. Regardless of the administration’s for expenditure in 2016-17. As discussed above, we ultimate decision on the transfer amount, the find that the administration likely underestimates Legislature could chose to provide additional the savings and overestimates the costs resulting funding to the programs funded by the SNSF. from the measure. Specifically, we estimate that the SNSF deposit in 2016-17 could be around HOW TO PAY FOR SNSF DEPOSIT IN 2016-17? As discussed earlier, we recommend that the process for DSH and the courts is not based on Legislature reduce the budgets of programs that workload so a separate action is required to revert have realized savings under the measure in order savings realized by these departments. However, to ensure that it does not result in any net effect on the administration does not propose any reductions state expenditures. However, as we discuss below, to DSH to reflect the estimated savings. Similarly, the administration does not propose adjustments it does not propose an adjustment for the courts to to DSH or the judicial branch to reflect savings reflect estimated savings, despite the fact that the to those departments, resulting in reduced 2015-16 budget already provided an augmentation budget transparency and increased General Fund to the courts for costs incurred to implement expenditures. Proposition 47, and proposes an additional augmentations in 2016-17. Administration’s Proposal LAO Comments Adjustments to CDCR’s Budget to Reflect Savings. The existing population-based budget Proposal Reduces Legislative Oversight. The process for CDCR results in adjustments to administration’s approach to allow both the judicial the department’s budget for estimated changes branch to keep the $1.7 million it is estimated to in inmate and parolee caseload. Given that have saved and DSH to keep the $9 million it is the administration’s estimate of the effects estimated to have saved would reduce legislative of Proposition 47 on the inmate and parolee oversight. This is because it would allow the judicial populations appears to be largely on target, the branch and DSH to redirect their savings to other savings and costs to CDCR resulting from the programs and services without legislative review or measure are generally already reflected in the approval. department’s appropriation for 2015-16. Recommend Reducing Courts and DSH No Adjustments to DSH and Courts Budgets Budgets. Because we believe the overall intent of to Reflect Savings. In contrast, the budgeting Proposition 47 is to have no net impact on state www.lao.ca.gov Legislative Analyst’s Office 11 2016-17 BUDGET expenditures, we recommend that the Legislature To the extent that the judicial branch or DSH reduce the budgets for the courts and DSH to require additional funding for Proposition 47 or account for the savings resulting from this measure. other workload, separate funding requests for that This reduction would result in additional resources workload should be submitted to the Legislature for becoming available to offset the funds that will be consideration as part of the budget process. transferred from the General Fund into the SNSF. HOW ARE FUNDS DEPOSITED IN THE SNSF SPENT? As discussed earlier, funds in the SNSF are CDE to Award Grants Aimed at Reducing continuously appropriated and are required to be School Dropouts and Truancy. The administration annually allocated to support (1) mental health and does not propose a specific plan for how the SNSF substance use services, (2) truancy and dropout funds would be awarded to schools. Instead, prevention, and (3) victim services. the administration indicates that it will work with the Legislature to develop a grant program Proposed Allocation of Funds consistent with the requirements of Proposition 47. BSCC to Award Grants Based on Recent The administration does propose that SNSF Legislation. Chapter 438 of 2015 (AB 1056, funding count towards the Proposition 98 Atkins) provides direction to BSCC regarding funding guarantee. (Proposition 98 is the state’s the allocation of grant funds from the SNSF for constitutional school funding obligation that recidivism reduction programs. Specifically, the generally requires a certain portion of state General legislation directs BSCC to allocate the funds Fund revenues go to schools.) through a competitive grant process to recipients VCGCB to Allocate TRC Grants. VCGCB with proposals that meet all of the following currently awards around $2 million in grants requirements: (1) are designed to serve people who annually to TRCs, which are programs that have been arrested, charged with, or convicted of directly assist victims in coping with a traumatic a criminal offense and have a history of mental event (such as by providing mental health care health or substance use disorders; (2) offer and substance use treatment). To date, six TRCs mental health treatment, substance use disorder statewide have received such grants. VCGCB treatment, misdemeanor diversion programs, or indicates that it plans to distribute Proposition 47 some combination of the three; and (3) have a monies through their existing grant process. public agency as the lead applicant. The legislation LAO Comments also requires BSCC to form an executive steering committee that includes relevant stakeholders (such Allocation for BSCC Grants Consistent With as representatives of state and local governments, Legislative Requirements. The administration community-based treatment providers, and proposes to allocate 65 percent of the SNSF deposit formerly incarcerated individuals) to make to BSCC to administer a grant program consistent recommendations regarding criteria for evaluating with the requirements of Chapter 438. Given that grant proposals. Under the legislation, BSCC this is consistent with both legislative intent and the could use up to 5 percent of the SNSF funding for measure, we find that this is a reasonable approach administration of the grant program. for allocating these funds. 12 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET Provide Flexibility to Schools in Using SNSF before needing to apply for a renewal of Funds, Focus on Outcomes. We recommend that their grant, or requiring VCGCB take such the Legislature allocate SNSF funds to schools with timing issues into consideration. Finally, the highest concentrations of at-risk students and the Legislature could prioritize which types then give those schools flexibility in deciding how of organizations will receive grant funds in best to address their dropout and truancy issues. the event that more grant applications are To this end, instead of tracking expenditures of received than can be funded with available SNSF funds, we recommend the state rely on its Proposition 47 monies. For example, newly adopted accountability system to monitor establishing TRCs affiliated with trauma student outcomes and intervene in districts that hospitals (as is the case with some state- fail to improve outcomes of at-risk students. This funded TRCs) provides a point of access for approach would be consistent with the state’s the most severely injured crime victims. decision to fund schools based on their students, • Ensure Receipt of Federal Reimbursement focusing less on spending requirements and more Funds. Under the federal Victims of Crime on student outcomes. Act (VOCA) grant program, the state is Provide More Guidance to VCGCB on TRC eligible to receive a federal reimbursement Grants. Given that the state only began funding of 60 cents for every state dollar spent on TRCs in recent years and because of their limited qualifying victim services. Examples of number, we recommend that the Legislature qualifying victim services include mental provide additional guidance to VCGCB on the use health counseling and medical expenses. of these funds. Specifically, we recommend the Some of the services TRCs are likely to Legislature: provide to crime victims are eligible for • Structure Grants to Ensure Effectiveness. federal VOCA funds. If the state is able We recommend that the Legislature to get VOCA funds for its expenditures structure the grants for TRCs to ensure on TRCs, it could increase the amount that funds are spent in a manner that of available funding. Accordingly, we effectively and efficiently provides services recommend that the Legislature direct the to victims. Specifically, we believe the VCGCB to ensure that the state receives all Legislature should consider requiring eligible federal VOCA funds for services TRCs to use a “trauma-informed” provided through TRCs. For example, approach—an approach to delivering the Legislature could consider requiring services that takes into account the unique VCGCB to collect information on eligible needs of individuals suffering a trauma expenditures from grant recipients and (such as providing multiple services from include those amounts when applying for one location in order to limit the number federal VOCA funds. of times victims must retell the story of their victimization in order to receive • Expand TRCs to Additional Regions of assistance). Additionally, the Legislature the State. Currently, six TRCs receive could consider specifying the length of funding—three in the Los Angeles grants to ensure that new TRCs have a region, one in San Francisco, one in sufficient amount of time to get established Stockton, and one in Fairfield. Given the www.lao.ca.gov Legislative Analyst’s Office 13 2016-17 BUDGET potentially significant benefits of TRCs as the number of victims served, the types in the provision of services to victims, we of services provided, and improvements recommend the Legislature expand access in victims’ mental health) and require to TRCs by requiring VCGCB to prioritize VCGCB to develop additional criteria that the allocation of Proposition 47 grant it deems necessary. The Legislature could funding to regions without TRCs. also have VCGCB periodically report on the outcomes achieved and any changes • Evaluate Grant Recipients Based on made to the grant program as a result Outcomes. In order to ensure that SNSF of the findings. VCGCB could use the dollars are being used effectively, we information gathered to inform future recommend the Legislature require the funding decisions. This would help ensure evaluation of TRC grant recipients and the that TRCs are delivering services to victims outcomes they achieve. The Legislature effectively. could specify certain basic criteria (such CONCLUSION Proposition 47 delegates the calculation of in 2016-17 could be around $100 million higher savings for deposit into the SNSF to DOF. These than the administration’s estimate of $29.3 million. calculations will be finalized after the Legislature Regardless of DOF’s estimate, the Legislature could adopts the 2016-17 budget. In this report, we choose to appropriate additional funding to the provide a framework for how we believe these programs funded by the SNSF if it finds that the calculations should be made. We also find that the administration’s savings estimates are too low. If it administration likely underestimates the savings so chooses, the Legislature will want to make use of and overestimates the costs resulting from the additional information on the costs and savings to measure. Specifically, we find that the SNSF deposit the courts described in this report. 14 Legislative Analyst’s Office www.lao.ca.gov 2016-17 BUDGET www.lao.ca.gov Legislative Analyst’s Office 15 2016-17 BUDGET Contact Information Drew Soderborg Managing Principal Analyst, 319-8346 Drew.Soderborg@lao.ca.gov Criminal Justice Aaron Edwards State Corrections and Sentencing 319-8351 Aaron.Edwards@lao.ca.gov Anita Lee State Courts and Victim Services 319-8321 Anita.Lee@lao.ca.gov Jonathan Peterson Department of State Hospitals 319-8324 Jonathan.Peterson@lao.ca.gov Natasha Collins California Department of Education 319-8335 Natasha.Collins@lao.ca.gov LAO Publications The Legislative Analyst’s Office (LAO) is a nonpartisan office which provides fiscal and policy information and advice to the Legislature. To request publications call (916) 445-4656. This brief and others, as well as an e-mail subscription service, are available on the LAO’s website at www.lao.ca.gov. The LAO is located at 925 L Street, Suite 1000, Sacramento, CA 95814. 16 Legislative Analyst’s Office www.lao.ca.gov