Mandates
Mandate Reform

The 2007 Governor's Budget included a proposal for mandates reform. During the 2007 budget development, state and local governments worked together to modify the proposal and developed alternative processes to mandate determinations and funding methodologies. The reform proposals are contained in Chapter 329, Statutes of 2007 (AB 1222). The reforms fall into three categories.


MANDATE REFORM: CHAPTER 329, STATUTES OF 2007 (AB 1222)
  • Redefines a Reasonable Reimbursement Methodology - removes the 50 percent threshold, and requires consideration of variations in costs among local agencies.
  • Joint Development of a Reasonable Reimbursement Methodology - allows Finance and local agencies to develop a funding methodology and statewide estimate of costs for adoption by the Commission.
  • Joint Request for Legislatively Determined Mandate - occurs outside of the Commission process, requires negotiations between local governments and Finance, and provides a local government the option to forgo the legislative determination and pursue the Commission process.
The first change revised the definition of a "reasonable reimbursement methodology (RRM)." The prior language included criteria that proved excessively difficult to meet. The new definition provides a variety of options for interested parties to propose funding methodologies that would make claiming for reimbursement and budgeting more predictable. The RRMs would no longer require evidence of actual costs for 50 percent of eligible claimants, but rather evidence that there is broad support among local governments.

The second change details in statute a process for the Department of Finance (Finance) and local governments to negotiate a reimbursement methodology, demonstrate before the Commission that there is broad support for the proposal, and include a statewide cost estimate. This process would allow for more accurate cost estimates, and reduce the Commission's workload on the related mandate. Currently, statewide cost estimates are based on the actual claims submitted and generally do not represent the universe of potential claimants or audit exceptions.

The third and most flexible option of Chapter 329 establishes a process for obtaining a legislatively determined mandate. This process would allow Finance and local governments to jointly request that the Legislature declare a statute or executive order a state mandate, approve a funding methodology, and appropriate funding based on that funding methodology. Local governments who are not supportive of the legislatively determined mandate could reject the proposed reimbursement methodology, and the related funds, and file a test claim with the Commission. This process would be the most expeditious way to complete the mandate determination process because Finance and local governments have agreed on the scope of the mandate and the terms of the reimbursement prior to submitting a request to the Legislature.

Currently, the average mandate determination process takes three years and funding is often provided six to seven years after enactment of a reimbursable mandate. The alternative processes should reduce this time by several years, thereby expediting the process while maintaining the integrity of the reimbursement system.
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CHAPTER HIGHLIGHTS for Mandates Back to Top

 Proposed Budget Balancing Reductions
 Other Special Session Issues
 Funded Mandates
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PRINTABLE BUDGET DOCUMENTS Back to Top
Budget Summary - Mandates (pdf * - 208K) -
Provides this entire Mandates Chapter in pdf format.