August 27, 2020

Over the weekend, SB 115 (Budget Bill Jr.) was amended and now includes budget bill language (BBL) related to the Realignment backfill. The Department of Finance worked closely with CSAC to craft this language in accordance with the agreement we reached in July and have described in prior communications. The BBL will ensure the remainder of the Realignment backfill amount will be distributed to counties as soon as possible to preserve the safety net, while maintaining a mechanism for the Administration to withhold funding if a county is out of compliance with the state’s COVID-19 health orders.

Last week, CSAC coordinated and distributed a county coalition letter in support of the language. It’s important to note that given the timing of when this language will likely be enacted, the Administration is moving forward on distributing a monthly Realignment backfill payment in September ($62.5 million statewide) prior to distributing the remaining amount required by this language.
 
Below are the major components of the Realignment backfill BBL contained in SB 115:

• Require three quarters of the $750 million Realignment backfill to be distributed to counties within 15 days of the chaptering of the legislation. This is the amount that remains after the first payment ($125 million statewide for July and August) and upcoming payment ($62.5 million for September). It would also require the $250 million amount subject to the federal trigger to be distributed within 15 days of the determination that the funding will be provided.
• Require counties to submit a monthly form to the Department of Finance certifying compliance with the state’s COVID-19 public health orders, with the first form due on October 1.
• Clarify that a county will be determined to be out of compliance with public health orders if the county has adopted an ordinance or resolution inconsistent with state public health orders.
• Allow the Department of Finance to redirect 1991 Realignment funding from a county that is determined to be out of compliance with public health orders instead of withholding the State General Fund for the Realignment backfill and indicate that this redirection would be equivalent to one month of the Realignment backfill General Fund amount.
• Require consultation with any county that is determined to be out of compliance and an opportunity to correct the deficiency prior to the redirection occurring.
• Provide further clarification that the General Fund backfill for Realignment must be spent consistent with how the individual county amounts were determined and displayed within the four program areas, and that this funding is not subject to AB 85 redirection.
• Make technical clarifications to ensure that any 1991 Realignment redirection does not impact a county’s Realignment base moving forward and impacts all programs within the Realignment backfill proportionally.

Since this agreement was reached with the Administration in July, CSAC has worked diligently to ensure that the final language will require the Realignment backfill funding to be distributed to counties quickly, provide needed clarity on compliance with health orders consistent with the agreement, and contain an opportunity for counties to address non-compliance before a redirection occurs. CSAC appreciates the strong partnership with the Administration and the Legislature on the need for this language and for moving to include it in the Budget Bill Jr., which amends aspects of the Budget Act of 2020. We will continue to work closely with county partners, the Legislature, and the Administration to ensure this bill is adopted prior to the end of session on August 31.