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SB-1 Developmental services: funding.(2015-2016)

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Amended  IN  Senate  September 03, 2015
Amended  IN  Senate  August 26, 2015

CALIFORNIA LEGISLATURE— 2015–2016 2nd Ext.

Senate Bill
No. 1

Introduced by Senator Beall
(Principal coauthors: Senators Monning and Pavley)
(Coauthors: Senators Block, Hertzberg, Hueso, and Mendoza)

July 02, 2015

An act to amend Sections 4648.4, 4652.5, 4681.3, 4681.6, 4688.21, 4689.8, 4691.9, and 4860, and to add Sections 4681.2, 4690.7, 4795, and 4796 to, the Welfare and Institutions Code, relating to developmental services.


LEGISLATIVE COUNSEL'S DIGEST


SB 1, as amended, Beall. Developmental services: funding.
(1) The Lanterman Developmental Disabilities Services Act requires the State Department of Developmental Services to contract with regional centers to provide services and supports to individuals with developmental disabilities. Under existing law, the regional centers purchase needed services for individuals with developmental disabilities through approved service providers or arrange for those services through other publicly funded agencies. The annual Budget Act also appropriates funds to the department to fund regional center operations.
This bill would require the department, subject to an appropriation by the Legislature for these purposes, to increase the funding paid to a regional center for the regional center’s operating budget by 10%, and to increase funding to enable the regional center and the regional center’s purchase-of-service vendors to fund certain costs related to minimum wage requirements. The bill would also require the department to develop a 10-year financial sustainability plan to ensure that the state’s community-based developmental services system effectively serves all individuals with developmental disabilities.
(2) Existing law establishes specified rates to be paid to certain service providers and the rates to be paid for certain developmental services. Existing law requires that rates to be paid to other developmental service providers either be set by the department or negotiated between the regional center and the service provider.
This bill would increase the rates established by existing law by 10%, as specified, and would require a 10% increase to the rates set by the department and the rates negotiated between regional centers and service providers, as specified.
(3) Existing law requires an entity that receives payments between $250,000 and $500,000 per year from one or more regional centers to obtain either an independent audit or independent review report of its financial statements and requires an entity that receives payments that are equal to or more than $500,000 per year to obtain an independent audit. Existing law exempts payments made using usual and customary rates for services provided by regional centers from these requirements.
This bill would instead require an entity to obtain only an independent review report of its financial statements relating to payments made by regional centers if it receives payments between $250,000 and $2,000,000 from one or more regional centers and would authorize these entities to apply for, and require the regional center to grant, a 2-year exemption from this requirement if the regional center does not find issues in the prior year’s independent review report that have an impact on regional center services. The bill would also require an entity to obtain an independent audit of its financial statements relating to payments made by regional centers if it receives payments that are equal to or more than $2,000,000 and would authorize these entities to apply for, and require the regional center to grant, a 2-year exemption from the audit requirement if the prior year’s audit resulted in an unmodified opinion, an unmodified opinion with additional communication, or a qualified opinion with issues that are not material and pervasive. The bill would require a regional center to notify the department of any exemption it grants to an entity that receives a qualified opinion report. The bill would also exempt social security benefit payments from these requirements.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 4648.4 of the Welfare and Institutions Code is amended to read:

4648.4.
 (a) Notwithstanding any other law, commencing July 1, 2006, rates for services listed in paragraphs (1), (2), with the exception of travel reimbursement, (3) to (8), inclusive, (10), and (11) of subdivision (b), shall be increased by 3 percent, subject to funds specifically appropriated for this increase in the Budget Act of 2006. The increase shall be applied as a percentage, and the percentage shall be the same for all providers. Any subsequent change shall be governed by subdivision (b).
(b) Notwithstanding any other law, except for subdivision (a), no regional center may pay any provider of the following services or supports a rate that is greater than the rate that is in effect on or after June 30, 2008, unless the increase is required by a contract between the regional center and the vendor that is in effect on June 30, 2008, or the regional center demonstrates that the approval is necessary to protect the consumer’s health or safety and the department has granted prior written authorization:
(1) Supported living services.
(2) Transportation, including travel reimbursement.
(3) Socialization training programs.
(4) Behavior intervention training.
(5) Community integration training programs.
(6) Community activities support services.
(7) Mobile day programs.
(8) Creative art programs.
(9) Supplemental day services program supports.
(10) Adaptive skills trainers.
(11) Independent living specialists.
(c) Notwithstanding subdivisions (a) and (b), and subject to an appropriation of funds by the Legislature for these purposes, a regional center shall increase rates for services listed in paragraphs (1), (2), with the exception of travel reimbursement, and (3) to (11), inclusive, of subdivision (b), if the rates are determined through a negotiation between the regional center and the provider, by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this subdivision, unless the rate for a service was increased pursuant to another provision of the act that added this subdivision.

SEC. 2.

 Section 4652.5 of the Welfare and Institutions Code is amended to read:

4652.5.
 (a) (1) An entity receiving that receives payments from one or more regional centers shall contract with an independent accounting firm for to obtain an independent audit or review of its financial statements relating to payments made by regional centers, subject to all both of the following:
(A) When If the amount received from the regional center or regional centers during the entity’s fiscal year is more than or equal to two hundred fifty thousand dollars ($250,000) but less than five hundred thousand dollars ($500,000), but less than two million dollars ($2,000,000), the entity shall obtain an independent audit or independent review report of its financial statements for the period. Consistent with Subchapter 21 (commencing with Section 58800) of Chapter 3 of Division 2 of Title 17 of the California Code of Regulations, this subdivision shall also apply to work activity program providers receiving less than two hundred fifty thousand dollars ($250,000).
(B) When If the amount received from the regional center or regional centers during the entity’s fiscal year is equal to or more than five hundred thousand dollars ($500,000), two million dollars ($2,000,000), the entity shall obtain an independent audit of its financial statements for the period.
(2) This requirement does not apply to payments made using usual and customary rates, as defined by Title 17 of the California Code of Regulations, for services provided by regional centers. centers or social security benefit payments.
(3) This requirement does not apply to state and local governmental agencies, the University of California, or the California State University.
(b) An entity subject to subdivision (a) shall provide copies of the independent audit or independent review report required by subdivision (a), and accompanying management letters, to the vendoring regional center within 30 days after completion of the audit or review. nine months of the end of the fiscal year for the entity.
(c) Regional centers receiving that receive the audit or review reports required by subdivision (b) shall review and require resolution by the entity for issues identified in the report that have an impact on regional center services. Regional centers shall take appropriate action, up to termination of vendorization, for lack of adequate resolution of issues.
(d) Regional centers shall notify the department of all qualified opinion reports or reports noting significant issues that directly or indirectly impact regional center services within 30 days after receipt. Notification shall include a plan for resolution of issues.
(e) For purposes of this section, an independent review of financial statements must shall be performed by an independent accounting firm and shall cover, at a minimum, all of the following:
(1) An inquiry as to the entity’s accounting principles and practices and methods used in applying them.
(2) An inquiry as to the entity’s procedures for recording, classifying, and summarizing transactions and accumulating information.
(3) Analytical procedures designed to identify relationships or items that appear to be unusual.
(4) An inquiry about budgetary actions taken at meetings of the board of directors or other comparable meetings.
(5) An inquiry about whether the financial statements have been properly prepared in conformity with generally accepted accounting principles and whether any events subsequent to the date of the financial statements would have a material effect on the statements under review.
(6) Working papers prepared in connection with a review of financial statements describing the items covered as well as any unusual items, including their disposition.
(f) For purposes of this section, an independent review report shall cover, at a minimum, all of the following:
(1) Certification that the review was performed in accordance with standards established by the American Institute of Certified Public Accountants.
(2) Certification that the statements are the representations of management.
(3) Certification that the review consisted of inquiries and analytical procedures that are lesser in scope than those of an audit.
(4) Certification that the accountant is not aware of any material modifications that need to be made to the statements for them to be in conformity with generally accepted accounting principles.
(g) The department shall not consider a request for adjustments to rates submitted in accordance with Title 17 of the California Code of Regulations by an entity receiving payments from one or more regional centers solely to fund either anticipated or unanticipated changes required to comply with this section.
(h) (1) An entity required to obtain an independent review report of its financial statement pursuant to subparagraph (A) of paragraph (1) of subdivision (a) may apply to the regional center for, and the regional center shall grant, a two-year exemption from the independent review report requirement if the regional center does not find issues in the prior year’s independent review report that have an impact on regional center services.
(2) An entity required to obtain an independent audit of its financial statements pursuant to subparagraph (B) of paragraph (1) of subdivision (a) may apply to the regional center for an exemption from the independent audit requirement, subject to both of the following conditions:
(A) If the independent audit for the prior year resulted in an unmodified opinion or an unmodified opinion with additional communication, the regional center shall grant the entity a two-year exemption.
(B) If the independent audit for the prior year resulted in a qualified opinion and the issues are not material and pervasive, the regional center shall grant the entity a two-year exemption. However, the entity and the regional center shall continue to address issues raised in this independent audit, regardless of whether the exemption is granted.
(3) A regional center shall notify the department of any exemption it grants to an entity that receives a qualified opinion report.

SEC. 3.

 Section 4681.2 is added to the Welfare and Institutions Code, to read:

4681.2.
 Notwithstanding any other law, and subject to an appropriation of funds by the Legislature for these purposes, the department shall increase the rates set for community care facilities serving persons with developmental disabilities by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this section.

SEC. 2.SEC. 4.

 Section 4681.3 of the Welfare and Institutions Code is amended to read:

4681.3.
 (a) Notwithstanding any other provision of this article, for the 1996–97 fiscal year, the rate schedule authorized by the department in operation on June 30, 1996, shall be increased based upon the amount appropriated in the Budget Act of 1996 for that purpose. The increase shall be applied as a percentage, and the percentage shall be the same for all providers.
(b) Notwithstanding any other provision of this article, for the 1997–98 fiscal year, the rate schedule authorized by the department in operation on June 30, 1997, shall be increased based upon the amount appropriated in the Budget Act of 1997 for that purpose. The increase shall be applied as a percentage, and the percentage shall be the same for all providers.
(c) Notwithstanding any other provision of this article, for the 1998–99 fiscal year, the rate schedule authorized by the department in operation on June 30, 1998, shall be increased commencing July 1, 1998, based upon the amount appropriated in the Budget Act of 1998 for that purpose. The increase shall be applied as a percentage, and the percentage shall be the same for all providers.
(d) Notwithstanding any other provision of this article, for the 1998–99 fiscal year, the rate schedule authorized by the department in operation on December 31, 1998, shall be increased January 1, 1999, based upon the cost-of-living adjustments in the Supplemental Security Income/State Supplementary Program for the Aged, Blind, and Disabled appropriated in the Budget Act of 1998 for that purpose. The increase shall be applied as a percentage and the percentage shall be the same for all providers.
(e) Notwithstanding any other provision of this article, for the 1999–2000 fiscal year, the rate schedule authorized by the department in operation on June 30, 1999, shall be increased July 1, 1999, based upon the amount appropriated in the Budget Act of 1999 for that purpose. The increase shall be applied as a percentage and the percentage shall be the same for all providers.
(f) In addition, commencing January 1, 2000, any funds available from cost-of-living adjustments in the Supplemental Security Income/State Supplementary Payment (SSI/SSP) for the 1999–2000 fiscal year shall be used to further increase the community care facility rate. The increase shall be applied as a percentage, and the percentage shall be the same for all providers.
(g) Notwithstanding any other law, for the 2006–07 fiscal year, the rate schedule in effect on June 30, 2006, shall be increased on July 1, 2006, by 3 percent, subject to funds specifically appropriated for this increase in the Budget Act of 2006. The increase shall be applied as a percentage and the percentage shall be the same for all providers. Any subsequent increase shall be governed by Sections 4681.5 and 4681.6.
(h) Notwithstanding any other law, for the 2015–16 fiscal year, the rate schedule and rates set by the department that are in effect on June 30, 2015, shall be increased by 10 percent, subject to funds specifically appropriated for this purpose. The increase shall be applied as a percentage and the percentage shall be the same for all providers. The increase required by this subdivision shall be in addition to the rate changes required by Chapter 23 of the Statutes of 2015.

SEC. 3.Section 4681.2 is added to the Welfare and Institutions Code, to read:
4681.2.

Notwithstanding any other law, and subject to an appropriation of funds by the Legislature for these purposes, the department shall increase the rates set for community care facilities serving persons with developmental disabilities by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this section.

SEC. 4.SEC. 5.

 Section 4681.6 of the Welfare and Institutions Code is amended to read:

4681.6.
 (a) Notwithstanding any other law, commencing July 1, 2008:
(1) A regional center shall not pay an existing residential service provider, for services for which rates are determined through a negotiation between the regional center and the provider, a rate higher than the rate in effect on June 30, 2008, unless the increase is required by a contract between the regional center and the vendor that is in effect on June 30, 2008, or the regional center demonstrates that the approval is necessary to protect the consumer’s health or safety and the department has granted prior written authorization.
(2) A regional center shall not negotiate a rate with a new residential service provider, for services for which rates are determined through a negotiation between the regional center and the provider, that is higher than the regional center’s median rate for the same service code and unit of service, or the statewide median rate for the same service code and unit of service, whichever is lower. The unit of service designation shall conform with an existing regional center designation or, if none exists, a designation used to calculate the statewide median rate for the same service. The regional center shall annually certify to the department its median rate for each negotiated rate service code, by designated unit of service. This certification shall be subject to verification through the department’s biennial fiscal audit of the regional center.
(b) Notwithstanding subdivision (a), commencing July 1, 2014, regional centers may negotiate a rate adjustment with residential service providers regarding rates that are otherwise restricted pursuant to subdivision (a), if the adjustment is necessary in order to pay employees no less than the minimum wage as established by Section 1182.12 of the Labor Code, as amended by Chapter 351 of the Statutes of 2013, and only for the purpose of adjusting payroll costs associated with the minimum wage increase. The rate adjustment shall be specific to the unit of service designation that is affected by the increased minimum wage, shall be specific to payroll costs associated with any increase necessary to adjust employee pay only to the extent necessary to bring pay into compliance with the increased state minimum wage, and shall not be used as a general wage enhancement for employees paid above the minimum wage. Regional centers shall maintain documentation on the process to determine, and the rationale for granting, any rate adjustment associated with the minimum wage increase.
(c) Notwithstanding subdivision (a), commencing July 1, 2015, regional centers may negotiate a rate adjustment with residential service providers regarding rates that are otherwise restricted pursuant to subdivision (a), if the adjustment is necessary to implement Article 1.5 (commencing with Section 245) of Chapter 1 of Part 1 of Division 2 of the Labor Code, as added by Chapter 317 of the Statutes of 2014. The rate adjustment may be applied only if a minimum of 24 hours or three days of paid sick leave per year was not a benefit provided to employees as of June 30, 2015, and shall be specific to payroll costs associated with any increase necessary to compensate an employee up to a maximum of 24 hours or three days of paid sick leave in each year of employment.
(d) Notwithstanding subdivision (a), and subject to an appropriation of funds by the Legislature for these purposes, regional centers shall increase the rates paid to residential service providers, for services for which rates are determined through a negotiation between the regional center and the provider, by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this subdivision.
(e) For purposes of this section, “residential service provider” includes Adult Residential Facilities for Persons with Special Health Care Needs, as described in Section 4684.50.
(f) This section shall not apply to those services for which rates are determined by the State Department of Health Care Services, or the State Department of Developmental Services, or are usual and customary.

SEC. 5.SEC. 6.

 Section 4688.21 of the Welfare and Institutions Code is amended to read:

4688.21.
 (a) The Legislature places a high priority on opportunities for adults with developmental disabilities to choose and customize day services to meet their individualized needs; have opportunities to further the development or maintenance of employment and volunteer activities; direct their services; pursue postsecondary education; and increase their ability to lead integrated and inclusive lives. To further these goals, a consumer may choose a tailored day service or vouchered community-based training service, in lieu of any other regional center vendored day program, look-alike day program, supported employment program, or work activity program.
(b) (1) A tailored day service shall do both of the following:
(A) Include an individualized service design, as determined through the individual program plan (IPP) and approved by the regional center, that maximizes the consumer’s individualized choices and needs. This service design may include, but may not be limited to, the following:
(i) Fewer days or hours than in the program’s approved day program, look-alike day program, supported employment program, or work activity program design.
(ii) Flexibility in the duration and intensity of services to meet the consumer’s individualized needs.
(B) Encourage opportunities to further the development or maintenance of employment, volunteer activities, or pursuit of postsecondary education; maximize consumer direction of the service; and increase the consumer’s ability to lead an integrated and inclusive life.
(2) The type and amount of tailored day service shall be determined through the IPP process, pursuant to Section 4646. The IPP shall contain, but not be limited to, the following:
(A) A detailed description of the consumer’s individualized choices and needs and how these choices and needs will be met.
(B) The type and amount of services and staffing needed to meet the consumer’s individualized choices and needs, and unique health and safety and other needs.
(3) The staffing requirements set forth in Section 55756 of Title 17 of the California Code of Regulations and subdivision (r) of Section 4851 of this code shall not apply to a tailored day service.
(4) For currently vendored programs wishing to offer a tailored day service option, the regional center shall vendor a tailored day service option upon negotiating a rate and maximum units of service design that includes, but is not limited to, the following:
(A) A daily or hourly rate and maximum units of service design that does not exceed the equivalent cost of four days per week of the vendor’s current rate, if the vendor has a daily day program rate.
(B) A rate and maximum units of service design that does not exceed the equivalent cost of four-fifths of the hours of the vendor’s current rate, if the vendor has an hourly rate.
(5) The regional center shall ensure that the vendor is capable of complying with, and will comply with, the consumer’s IPP, individual choice, and health and safety needs.
(6) For new programs wishing to offer a tailored day service option, the regional center shall vendor a tailored day service option upon negotiating a rate and maximum units of service design. The rate paid to the new vendor shall not exceed four-fifths of the temporary payment rate or the median rate, whichever is applicable.
(7) Notwithstanding any other law, and subject to an appropriation of funds by the Legislature for these purposes, the rates paid to tailored day service providers shall be increased by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this paragraph.
(8) Effective July 1, 2011, and prior to the time of development, review, or modification of a consumer’s IPP, regional centers shall provide information about tailored day service to eligible adult consumers. A consumer may request information about tailored day services from the regional center at any time and may request an IPP meeting to secure those services.
(c) (1) A vouchered community-based training service is defined as a consumer-directed service that assists the consumer in the development of skills required for community integrated employment or participation in volunteer activities, or both, and the assistance necessary for the consumer to secure employment or volunteer positions or pursue secondary education.
(2) Implementation of vouchered community-based training service is contingent upon the approval of the federal Centers for Medicare and Medicaid Services.
(3) Vouchered community-based training service shall be provided in natural environments in the community, separate from the consumer’s residence.
(4) A consumer, parent, or conservator vendored as a vouchered community-based training service shall utilize the services of a financial management services (FMS) entity. The regional center shall provide information about available financial management services and shall assist the consumer in selecting a FMS vendor to act as coemployer.
(5) A parent or conservator shall not be the direct support worker employed by the vouchered community-based training service vendor.
(6) If the direct support worker is required to transport the consumer, the vouchered community-based training service vendor shall verify that the direct support worker can transport the consumer safely and has a valid California driver’s license and proof of insurance.
(7) (A) The rate for vouchered community-based training service shall not exceed thirteen dollars and forty-seven cents ($13.47) per hour. The rate includes employer-related taxes and all transportation needed to implement the service, except as described in paragraph (8). The rate does not include the cost of the FMS.
(B) Notwithstanding subparagraph (A), and subject to an appropriation of funds by the Legislature for these purposes, the rate described in subparagraph (A) shall be fourteen dollars and eighty-two cents ($14.82) per hour.
(8) A consumer vendored as a vouchered community-based training service shall also be eligible for a regional center-funded bus pass, if appropriate and needed.
(9) Vouchered community-based training service shall be limited to a maximum of 150 hours per quarter. The services to be provided and the service hours shall be documented in the consumer’s IPP.
(10) A direct support worker of vouchered community-based training service shall be an adult who possesses the skill, training, and experience necessary to provide services in accordance with the IPP.
(11) Effective July 1, 2011, and prior to the time of development, review, or modification of a consumer’s IPP, regional centers shall provide information about vouchered community-based training service to eligible adult consumers. A consumer may request information about vouchered community-based training service from the regional center at any time and may request an IPP meeting to secure those services.
(12) The type and amount of vouchered community-based training service shall be determined through the IPP process pursuant to Section 4646. The IPP shall contain, but not be limited to, the following:
(A) A detailed description of the consumer’s individualized choices and needs and how these choices and needs will be met.
(B) The type and amount of services and staffing needed to meet the consumer’s individualized choices and unique health and safety and other needs.
(d) The department may adopt emergency regulations for tailored day service or vouchered community-based training service. The adoption, amendment, repeal, or readoption of a regulation authorized by this subdivision is deemed to be necessary for the immediate preservation of the public peace, health and safety, or general welfare, for purposes of Sections 11346.1 and 11349.6 of the Government Code, and the department is hereby exempted from the requirement that it describe specific facts showing the need for immediate action. A certificate of compliance for these implementing regulations shall be filed within 24 months following the adoption of the first emergency regulations filed pursuant to this subdivision.

SEC. 6.SEC. 7.

 Section 4689.8 of the Welfare and Institutions Code is amended to read:

4689.8.
 (a) Notwithstanding any other law, commencing July 1, 2008:
(1) A regional center shall not pay an existing supported living service provider, for services for which rates are determined through a negotiation between the regional center and the provider, a rate higher than the rate in effect on June 30, 2008, unless the increase is required by a contract between the regional center and the vendor that is in effect on June 30, 2008, or the regional center demonstrates that the approval is necessary to protect the consumer’s health or safety and the department has granted prior written authorization.
(2) A regional center shall not negotiate a rate with a new supported living service provider, for services for which rates are determined through a negotiation between the regional center and the provider, that is higher than the regional center’s median rate for the same service code and unit of service, or the statewide median rate for the same service code and unit of service, whichever is lower. The unit of service designation shall conform with an existing regional center designation or, if none exists, a designation used to calculate the statewide median rate for the same service. The regional center shall annually certify to the State Department of Developmental Services its median rate for each negotiated rate service code, by designated unit of service. This certification shall be subject to verification through the department’s biennial fiscal audit of the regional center.
(b) Notwithstanding subdivision (a), and subject to an appropriation of funds by the Legislature for these purposes, regional centers shall increase the rates paid to supported living service providers, for services for which rates are determined through a negotiation between the regional center and the provider, by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this subdivision.

SEC. 7.SEC. 8.

 Section 4690.7 is added to the Welfare and Institutions Code, to read:

4690.7.
 (a)Notwithstanding any other law, and subject to an appropriation of funds by the Legislature for these purposes, the department shall increase the rates set for nonresidential service providers by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this section.

SEC. 8.SEC. 9.

 Section 4691.9 of the Welfare and Institutions Code is amended to read:

4691.9.
 (a) Notwithstanding any other law, commencing July 1, 2008:
(1) A regional center shall not pay an existing service provider, for services where rates are determined through a negotiation between the regional center and the provider, a rate higher than the rate in effect on June 30, 2008, unless the increase is required by a contract between the regional center and the vendor that is in effect on June 30, 2008, or the regional center demonstrates that the approval is necessary to protect the consumer’s health or safety and the department has granted prior written authorization.
(2) A regional center shall not negotiate a rate with a new service provider, for services where rates are determined through a negotiation between the regional center and the provider, that is higher than the regional center’s median rate for the same service code and unit of service, or the statewide median rate for the same service code and unit of service, whichever is lower. The unit of service designation shall conform with an existing regional center designation or, if none exists, a designation used to calculate the statewide median rate for the same service. The regional center shall annually certify to the State Department of Developmental Services its median rate for each negotiated rate service code, by designated unit of service. This certification shall be subject to verification through the department’s biennial fiscal audit of the regional center.
(b) Notwithstanding subdivision (a), commencing July 1, 2014, regional centers may negotiate a rate adjustment with providers regarding rates if the adjustment is necessary in order to pay employees no less than the minimum wage as established by Section 1182.12 of the Labor Code, as amended by Chapter 351 of the Statutes of 2013, and only for the purpose of adjusting payroll costs associated with the minimum wage increase. The rate adjustment shall be specific to the unit of service designation that is affected by the increased minimum wage, shall be specific to payroll costs associated with any increase necessary to adjust employee pay only to the extent necessary to bring pay into compliance with the increased state minimum wage, and shall not be used as a general wage enhancement for employees paid above the increased minimum wage. Regional centers shall maintain documentation on the process to determine, and the rationale for granting, any rate adjustment associated with the minimum wage increase.
(c) Notwithstanding any other law or regulation, commencing January 1, 2015, rates for personal assistance and supported living services in effect on December 31, 2014, shall be increased by 5.82 percent, subject to funds specifically appropriated for this increase for costs due to changes in federal regulations implementing the federal Fair Labor Standards Act of 1938 (29 U.S.C. Sec. 201 et seq.). The increase shall be applied as a percentage, and the percentage shall be the same for all applicable providers. As used in this subdivision, both of the following definitions shall apply:
(1) “Personal assistance” is limited only to those services provided by vendors classified by the regional center as personal assistance providers, pursuant to the miscellaneous services provisions contained in Title 17 of the California Code of Regulations.
(2) “Supported living services” are limited only to those services defined as supported living services in Title 17 of the California Code of Regulations.
(d) Notwithstanding subdivision (a), commencing July 1, 2015, regional centers may negotiate a rate adjustment with existing service providers for services for which rates are determined through negotiation between the regional center and the provider, if the adjustment is necessary to implement Article 1.5 (commencing with Section 245) of Chapter 1 of Part 1 of Division 2 of the Labor Code, as added by Chapter 317 of the Statutes of 2014. The rate adjustment may be applied only if a minimum of 24 hours or three days of paid sick leave per year was not a benefit provided to employees as of June 30, 2015, and shall be specific to payroll costs associated with any increase necessary to compensate an employee up to a maximum of 24 hours or three days of paid sick leave in each year of employment.
(e) Notwithstanding subdivision (a), and subject to an appropriation of funds by the Legislature for these purposes, regional centers shall increase the rates paid to service providers, for services for which rates are determined through a negotiation between the regional center and the provider, by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this subdivision.
(f) This section shall not apply to those services for which rates are determined by the State Department of Health Care Services, or the State Department of Developmental Services, or are usual and customary.

SEC. 9.SEC. 10.

 Section 4795 is added to the Welfare and Institutions Code, to read:

4795.
 (a) The department shall, subject to an appropriation of funds by the Legislature for these purposes, increase the funding provided to a regional center for the regional center’s operating budget by 10 percent above the levels that otherwise would have been in effect on the effective date of the act that added this section.
(b) The department shall, subject to an appropriation of funds by the Legislature for these purposes, increase the funding provided to a regional center to enable the regional center and regional center’s purchase-of-service vendors to fund all of the following costs associated with minimum wage requirements:
(1) The costs to comply with a statewide minimum wage requirement.
(2) The costs to comply with minimum wage requirements enacted by local governments that exceed the statewide minimum wage.
(3) The costs to increase compensation for exempt, salaried employees to comply with wage orders issued by the Industrial Welfare Commission or any other state regulatory agency.
(4) Any other wage adjustments that vendors are required to make in response to minimum wage increases mandated by state or federal statutes, regulations, or other authorities.

SEC. 10.SEC. 11.

 Section 4796 is added to the Welfare and Institutions Code, to read:

4796.
 The department shall develop a 10-year financial sustainability plan to ensure that the state’s community-based developmental services system effectively serves all individuals with developmental disabilities.

SEC. 11.SEC. 12.

 Section 4860 of the Welfare and Institutions Code is amended to read:

4860.
 (a) (1) (A) The hourly rate for supported employment services provided to consumers receiving individualized services shall be thirty dollars and eighty-two cents ($30.82).
(B) Notwithstanding subparagraph (A), and subject to an appropriation of funds by the Legislature for these purposes, the rate described in subparagraph (A) shall be thirty-three dollars and ninety cents ($33.90).
(2) Job coach hours spent in travel to consumer worksites may be reimbursable for individualized services only when the job coach travels from the vendor’s headquarters to the consumer’s worksite or from one consumer’s worksite to another, and only when the travel is one way.
(b) (1) The hourly rate for group services shall be thirty dollars and eighty-two cents ($30.82), regardless of the number of consumers served in the group. Consumers in a group shall be scheduled to start and end work at the same time, unless an exception that takes into consideration the consumer’s compensated work schedule is approved in advance by the regional center. The department, in consultation with stakeholders, shall adopt regulations to define the appropriate grounds for granting these exceptions. When the number of consumers in a supported employment placement group drops to fewer than the minimum required in subdivision (r) of Section 4851, the regional center may terminate funding for the group services in that group, unless, within 90 days, the program provider adds one or more regional centers, or Department of Rehabilitation-funded supported employment consumers to the group.
(2) Notwithstanding paragraph (1), and subject to an appropriation of funds by the Legislature for these purposes, the rate described in paragraph (1) shall be thirty-three dollars and ninety cents ($33.90).
(c) Job coaching hours for group services shall be allocated on a prorated basis between a regional center and the Department of Rehabilitation when regional center and Department of Rehabilitation consumers are served in the same group.
(d) When Section 4855 applies, fees shall be authorized for the following:
(1) (A) A three-hundred-sixty-dollar ($360) fee shall be paid to the program provider upon intake of a consumer into a supported employment program. No fee shall be paid if that consumer completed a supported employment intake process with that same supported employment program within the previous 12 months.
(B) Notwithstanding subparagraph (A), and subject to an appropriation of funds by the Legislature for these purposes, the fee described in subparagraph (A) shall be three hundred ninety-six ninety six dollars ($396).
(2) (A) A seven-hundred-twenty-dollar ($720) fee shall be paid upon placement of a consumer in an integrated job, except that no fee shall be paid if that consumer is placed with another consumer or consumers assigned to the same job coach during the same hours of employment.
(B) Notwithstanding subparagraph (A), and subject to an appropriation of funds by the Legislature for these purposes, the fee described in subparagraph (A) shall be seven hundred ninety-two ninety two dollars ($792).
(3) (A) A seven-hundred-twenty-dollar ($720) fee shall be paid after a 90-day retention of a consumer in a job, except that no fee shall be paid if that consumer has been placed with another consumer or consumers, assigned to the same job coach during the same hours of employment.
(B) Notwithstanding subparagraph (A), and subject to an appropriation of funds by the Legislature for these purposes, the fee described in subparagraph (A) shall be seven hundred ninety-two ninety two dollars ($792).
(e) Notwithstanding paragraph (4) of subdivision (a) of Section 4648, the regional center shall pay the supported employment program rates established by this section.

SEC. 12.SEC. 13.

 The rate increases for developmental services required by this act shall supplement, and not supplant, increases to those rates made by the Budget Act of 2015 and Chapter 23 of the Statutes of 2015.