Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973. A violation of any provision of the act is a misdemeanor.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity or other reasons to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings or take other action by January 1, 2020, as specified.

This bill would require all hospitals with buildings subject to the January 1, 2020, deadline described above and that are seeking an extension for their buildings to submit an application to the Office of Statewide Health Planning and Development by April 1, 2019, that specifies the seismic compliance method each building will use, as specified. The bill would require the office to grant an additional extension of time to an owner who is subject to the January 1, 2020, deadline if specified conditions are met. The bill would authorize the additional extension to be until July 1, 2022, if the compliance plan is based upon replacement or retrofit, as defined, or up to 5 years if the compliance plan is for a rebuild, as defined. The bill would require the office, before June 1, 2019, to provide the Legislature with a specified inventory of the hospital buildings. The bill would authorize the office to promulgate emergency regulations as necessary to implement these provisions.

Existing law requires, no later than January 1, 2030, the owner of an acute care inpatient hospital to either demolish, replace, or change to nonacute care use a hospital building that is not in substantial compliance with certain seismic safety regulations and standards developed by the office, or to seismically retrofit the building so that it is in substantial compliance.

This bill would require, before January 1, 2020, the owner of an acute care inpatient hospital whose building does not substantially comply with the above-described seismic safety regulations or standards to submit to the office an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance with those regulations and standards.

By imposing new requirements under the act for owners of hospitals with regard to extension applications and the above-described attestation, this bill would expand the scope of a crime, thereby imposing a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973. A violation of any provision of the act is a misdemeanor.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity or other reasons to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings or take other action by January 1, 2020, as specified.

This bill would require all hospitals with buildings subject to the January 1, 2020, deadline described above and that are seeking an extension for their buildings to submit an application to the Office of Statewide Health Planning and Development by April 1, 2019, that specifies the seismic compliance method each building will use, as specified. The bill would require the office to grant an additional extension of time to an owner who is subject to the January 1, 2020, deadline if specified conditions are met. The bill would authorize the additional extension to be until July 1, 2022, if the compliance plan is based upon replacement or retrofit, as defined, or up to 5 years if the compliance plan is for a rebuild, as defined. The bill would require the office, before June 1, 2019, to provide the Legislature with a specified inventory of the hospital buildings. The bill would authorize the office to promulgate emergency regulations as necessary to implement these provisions.

Existing law requires, no later than January 1, 2030, the owner of an acute care inpatient hospital to either demolish, replace, or change to nonacute care use a hospital building that is not in substantial compliance with certain seismic safety regulations and standards developed by the office, or to seismically retrofit the building so that it is in substantial compliance.

This bill would require, before January 1, 2020, the owner of an acute care inpatient hospital whose building does not substantially comply with the above-described seismic safety regulations or standards to submit to the office an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance with those regulations and standards.

By imposing new requirements under the act for owners of hospitals with regard to extension applications and the above-described attestation, this bill would expand the scope of a crime, thereby imposing a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973. A violation of any provision of the act is a misdemeanor.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity or other reasons to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings or take other action by January 1, 2020, as specified.

This bill would require all hospitals with buildings subject to the January 1, 2020, deadline described above and that are seeking an extension for their buildings to submit an application to the Office of Statewide Health Planning and Development by April 1, 2019, that specifies the seismic compliance method each building will use, as specified. The bill would require the office to grant an additional extension of time to an owner who is subject to the January 1, 2020, deadline if specified conditions are met. The bill would authorize the additional extension to be until July 1, 2022, if the compliance plan is based upon replacement or retrofit, as defined, or up to 5 years if the compliance plan is for a rebuild, as defined. The bill would require the office, before June 1, 2019, to provide the Legislature with a specified inventory of the hospital buildings. The bill would authorize the office to promulgate emergency regulations as necessary to implement these provisions.

Existing law requires, no later than January 1, 2030, the owner of an acute care inpatient hospital to either demolish, replace, or change to nonacute care use a hospital building that is not in substantial compliance with certain seismic safety regulations and standards developed by the office, or to seismically retrofit the building so that it is in substantial compliance.

This bill would require, before January 1, 2020, the owner of an acute care inpatient hospital whose building does not substantially comply with the above-described seismic safety regulations or standards to submit to the office an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance with those regulations and standards.

By imposing new requirements under the act for owners of hospitals with regard to extension applications and the above-described attestation, this bill would expand the scope of a crime, thereby imposing a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973. A violation of any provision of the act is a misdemeanor.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity or other reasons to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings or take other action by January 1, 2020, as specified.

This bill would require all hospitals with buildings subject to the January 1, 2020, deadline described above and that are seeking an extension for their buildings to submit an application to the Office of Statewide Health Planning and Development by April 1, 2019, that specifies the seismic compliance method each building will use, as specified. The bill would require the office to grant an additional extension of time to an owner who is subject to the January 1, 2020, deadline if specified conditions are met. The bill would authorize the additional extension to be up to 30 months or 5 years depending on whether until July 1, 2022, if the compliance plan is based upon replacement, retrofit, or rebuild, as defined. replacement or retrofit, as defined, or up to 5 years if the compliance plan is for a rebuild, as defined. The bill would require the office, before June 1, 2019, to provide the Legislature with a specified inventory of the hospital buildings. The bill would authorize the office to promulgate emergency regulations as necessary to implement these provisions.

Existing law requires, no later than January 1, 2030, the owner of an acute care inpatient hospital to either demolish, replace, or change to nonacute care use a hospital building that is not in substantial compliance with certain seismic safety regulations and standards developed by the office, or to seismically retrofit the building so that it is in substantial compliance.

This bill would require, before January 1, 2020, the owner of an acute care inpatient hospital whose building does not substantially comply with the above-described seismic safety regulations or standards to submit to the office an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance with those regulations and standards.

By imposing new requirements under the act for owners of hospitals with regard to extension applications and the above-described attestation, this bill would expand the scope of a crime, thereby imposing a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973. A violation of any provision of the act is a misdemeanor.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity or other reasons to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings or take other action by January 1, 2020, as specified.

This bill would require all hospitals with buildings subject to the January 1, 2020, deadline described above and that are seeking an extension for their buildings to submit a written an application to the Office of Statewide Health Planning and Development by July April 1, 2019, that specifies the seismic compliance method each building will use, as specified. The bill would require the office to grant an additional extension of time to an owner who is subject to the January 1, 2020, deadline if specified conditions are met. The bill would authorize the additional extension to be up to 30 months or 5 years depending on whether the compliance plan is based upon replacement, retrofit, or rebuild, as defined. The bill would require the office, before June 1, 2019, to provide the Legislature with a specified inventory of the hospital buildings. The bill would authorize the authority office to promulgate emergency regulations as necessary to implement these provisions.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings by January 1, 2020, as specified.

This bill would require all hospitals with buildings subject to the January 1, 2020, deadline described above to submit a binding written application to the Office of Statewide Health Planning and Development by July 1, 2019, that specifies the seismic compliance method each building will use, as specified. The bill would require the office to grant an additional extension of time to an owner who is subject to the January 1, 2020, deadline if specified conditions are met. The bill would authorize the additional extension to be up to 30 months or 5 years depending on whether the compliance plan is based upon replacement, retrofit, or rebuild, as defined. The bill would authorize the authority to promulgate emergency regulations as necessary to implement these provisions.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances. Existing law additionally allows the office to grant a hospital that has received extensions under specified provisions an extension of up to 7 years for a hospital building that it owns or operates if the hospital meets specified milestones. The office may revoke an extension granted pursuant to the latter authority if it determines that a hospital has falsified information, has failed to meet a milestone, or has abandoned or suspended a work of construction for a specified period, as prescribed. circumstances, except as specified. Existing law requires an owner of a general acute care hospital building that is classified as nonconforming to submit a report to the office no later than November 1, 2010, describing the status of each building in complying with the extension provisions, and to annually update the office with any changes or adjustments. Existing law authorizes certain hospital owners who do not have the financial capacity to bring certain buildings into compliance by the January 1, 2013, deadline to instead replace those buildings by January 1, 2020, as specified.

Existing law, the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983, establishes, under the jurisdiction of the Office of Statewide Health Planning and Development, a program of seismic safety building standards for certain hospitals constructed on and after March 7, 1973.

Existing law provides that, after January 1, 2008, a general acute care hospital building that is determined to be a potential risk of collapse or to pose significant loss of life in the event of seismic activity be used only for nonacute care hospital purposes, except that the office may grant 5-year and 2-year extensions under prescribed circumstances. Existing law additionally allows the office to grant a hospital that has received extensions under specified provisions an extension of up to 7 years for a hospital building that it owns or operates if the hospital meets specified milestones. The office may revoke an extension granted pursuant to the latter authority if it determines that a hospital has falsified information, has failed to meet a milestone, or has abandoned or suspended a work of construction for a specified period, as prescribed.

This bill would require the office to provide a 30-day notice to the hospital prior to revoking an additional extension as described above and to provide the hospital with the opportunity to provide evidence and information to challenge the revocation. The bill also would make various technical, nonsubstantive changes.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2190

Author:(Reyes)

As Amended Ver:August 24, 2018

Majority vote

Original Committee Reference: HEALTH

SUMMARY: Provides for an extension of the January 1, 2020, hospital seismic safety deadline of up to 30 months (until July 1, 2022) for hospitals that plan to replace or retrofit a building to at least the 2020 standard of Seismic Performance Category - 2 (SPC), and up to five years (January 1, 2025) for hospitals that plan to rebuild to SPC-4D or SPC-5 standards that meet 2030 standards.

The Senate amendments:

1. Prohibit the Office of Statewide Health Planning and Development (OSHPD) from granting an extension for SPC-1 buildings, unless the owner has submitted a seismic compliance plan to OSHPD by January 1, 2018.
2. Authorize OSHPD to grant adjustments to the extension deadlines to deal with contractor, labor or material delays, or with acts of God. Requires hospitals to submit revised construction schedules, and provides for penalties for failure to comply with the revised construction schedule.
3. Require OSHPD, before June 1, 2019, to provide the Legislature with an inventory of the SPC category of each hospital building.
4. Require, before January 1, 2020, the owner of a hospital that does not substantially comply with seismic safety regulations or standards to submit an attestation to OSHPD that the board of directors of the hospital is aware that the hospital building is required to meet the January 1, 2030 deadline for seismic compliance.
5. Authorize OSHPD to revoke an extension where the assessment for a penalty exceeds 60 days, and prohibits OSHPD from issuing a construction final or certificate of occupancy for the building until all assessed penalties have been paid in full, or have been posted subject to resolution of an appeal.

FISCAL EFFECT: According to the Senate Appropriations Committee, pursuant to Senate Rule 28.8, negligible state costs.

COMMENTS: According to the author, "our hospitals are essential healthcare partners in our communities and the requirement for them to remain standing after a major earthquake ensures they will continue to be a resource to our community after a disaster." The author states that almost all of California's hospitals have met this requirement, and this bill will allow the last remaining few hospitals to meet the mandate without fear of closure should they have a construction or financing delay. The author concludes this bill includes strong penalties to ensure these hospitals stay on track in meeting this important mandate.

1. Hospital seismic requirements. Following the 1971 San Fernando Valley earthquake, California enacted the Alquist Act, which mandated that all new hospital construction meet stringent seismic safety standards. In 1994, after the Northridge earthquake, the Legislature passed and the Governor signed SB 1953 (Alquist), Chapter 740, Statutes of 1994, which required OSHPD to establish earthquake performance categories for hospitals, and established a January 1, 2008, deadline by which general acute care hospitals must be retrofitted or replaced so that they do not pose a risk of collapse in the event of an earthquake; and a January 1, 2030, deadline by which they must be capable of remaining operational following an earthquake. Subsequent legislation allowed most hospitals to qualify for an extension of the January 1, 2008 deadline to January 1, 2013.

OSHPD categorizes hospitals into five SPCs. SPC-1 is the category of buildings at most risk of collapse in an earthquake, and it is these hospitals that were originally required to be taken out of service or retrofitted by January 1, 2008, which has since been extended for some hospitals to January 1, 2020. Buildings in SPC-2, 3, 4, and 5 are generally categorized based on when they were built and the building code regulations in effect at that time. Hospital buildings in any of these categories may be used up until January 1, 2030, at which time hospitals must either meet SPC-5 requirements, or under recently adopted regulations, the new category of SPC-4D. SPC-5 generally requires new construction for any building constructed before 1989, while SPC-4D allows for some older buildings to be retrofitted and still be compliant with January 1, 2030 standards.

In addition to the original five-year extension to January 1, 2013, the Legislature has passed additional bills allowing hospitals to extend the deadlines for retrofitting SPC 1 buildings beyond the 2013 deadline. SB 306 (Ducheny), Chapter 642, Statutes of 2007, permitted a hospital owner to comply with seismic safety deadlines and requirements in current law by replacing all of its buildings subject to seismic retrofit by January 1, 2020, rather than retrofitting by 2013 and replacing them by 2030, if the hospital meets several conditions and OSHPD certifies that the hospital owner lacks the financial capacity to meet seismic standards, as defined. SB 90 (Steinberg), Chapter 19, Statutes of 2011, allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years (no later than January 1, 2020) based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.

1. Current status of SPC-1 compliance in California. According to OSHPD, there are 78 hospital facilities that have SPC-1 buildings still in patient service; with a cumulative total of 191 buildings (some facilities have more than one SPC-1 building). These facilities have already received extensions authorized pursuant to either SB 90 or SB 306. According to OSHPD, of these 78 facilities, six are not likely to make the 2020 deadline, all of which have plans submitted. OSHPD also has concerns about approximately 20 facilities making the 2020 deadline, all of which have plans submitted. OSHPD is aware of two facilities (Pacific Alliance and Community Hospital Long Beach) that have announced they intend to close. The remaining 50 facilities are either close to completion or could make the 2020 deadline.

Facilities that OSHPD believes are not likely to complete a retrofit by 2020:

Facilities OSHPD has concerns with completion by 2020: 

Facilities that have announced plans to close or are in the process of closing:

Retrofit = Building will be retrofitted

Rebuild = General Acute Care services will be moved to new building/s

Replace = General Acute Care services will be moved to existing SPC 2 or higher building/s

Remove = General Acute Care services will be removed from building

The California Hospital Association (CHA) is the sponsor of this bill and states that over 90% of California's hospitals have achieved seismic compliance, however, approximately two dozen hospitals remain classified as SPC-1 (potential collapse hazard). CHA notes that some will achieve compliance by 2020, but others will need the extensions outlined in this bill to allow them to remain open while they finish their construction projects.

Loma Linda University Health (LLUH) supports this bill and states that it initially began to retrofit its hospital complex in 1998, however after considerable planning it became clear that to ensure premiere patient safety and to maximize cost effectiveness; LLUH should not retrofit the buildings but develop new construction of a hospital complex. Main hospital construction began in April of 2016. LLUH has an approved plan from OSHPD through December 2019, however due to OSHPD timelines, scope growth, and other common issues involved in large construction projects, construction is expected to be complete by the end of 2020.

Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097 FN: 0005155

 THIRD READING  

Bill No: AB 2190

Author:

:

Vote:

SENATE HEALTH COMMITTEE: 9-0, 6/27/18

AYES: Pan, Nguyen, Beall, Hernandez, Leyva, Mitchell, Monning, Nielsen, Roth

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 70-0, 5/25/18 (Consent) - See last page for vote

SUBJECT:

SOURCE: California Hospital Association

DIGEST:

This bill provides for an extension of the January 1, 2020 hospital seismic safety deadline of up to 30 months (until July 1, 2022) for hospitals that plan to replace or retrofit a building to at least the 2020 standard of SPC-2, and up to five years (January 1, 2025) for hospitals that plan to rebuild to SPC-4D or SPC-5 standards that meet 2030 standards.

Senate Floor Amendments of 8/24/18 prohibit an extension of the seismic safety requirements from being granted under this bill unless the hospital has submitted a seismic compliance plan to OSHPD by January 1, 2018.

ANALYSIS:

Existing law:

1. Establishes the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 (Alquist Act), to ensure that hospital buildings are designed and constructed to resist the forces generated by earthquakes and requires the Office of Statewide Health Planning and Development (OSHPD) to propose building standards for earthquake resistance and to provide independent review of the design and construction of hospital buildings. [HSC §129675, et seq.]
   
2. Establishes timelines for hospital compliance with seismic safety standards, including a requirement that buildings posing a significant risk of collapse and a danger to the public (referred to as SPC -1 buildings) be rebuilt or retrofitted to be capable of withstanding an earthquake, or removed from acute care service, by January 1, 2008, and a requirement that hospital buildings be capable of remaining intact after an earthquake, and must also be capable of continued operation by January 1, 2030. [HSC §130060, §130065]
3. Permits OSHPD to grant an extension of up to five years to the 2008 deadline, which would be January 1, 2013, for hospitals for which compliance will result in a loss of health care capacity, as defined. Allows OSHPD to grant various further extensions beyond this, including up to seven years to January 1, 2020, in part based on the loss of essential hospital services to the community if the hospital closed, and financial hardship. [HSC §130060, §130061.5]

This bill:

1. Defines the following terms for purposes of this bill:
2. “rebuild plan” is a plan to meet seismic standards primarily by constructing a new conforming SPC-5 building for use in lieu of an SPC-1 building;
3. “removal plan” is a plan to meet seismic standards primarily by removing acute care services or beds from the hospital’s license;
4. “replacement plan” is a plan to meet seismic standards primarily by relocating acute care services or beds from nonconforming buildings into a conforming building; and,
5. “retrofit plan” is a plan to meet seismic standards primarily by modifying the building in a manner that brings the building up to SPC-2, SPC-4D, or SPC-5 standards.
6. Permits a hospital owner that has been granted an extension, to January 1, 2020, of the seismic safety requirements to rebuild or retrofit SPC-1 buildings, to request an additional extension of time as provided in this bill.
7. Requires all hospitals seeking an extension for their SPC-1 buildings to submit to OSHPD an application, in a manner acceptable to OSHPD, by April 1, 2019. Requires the application, at a minimum, to state which of the seismic compliance methods, as defined in this bill, will be used for each SPC-1 building.
8. Requires a hospital that is seeking an extension for compliance based on a replacement or retrofit plan, to submit a construction schedule, obtain a building permit, and begin construction by April 1, 2020. For a replacement or retrofit plan, establishes the following additional requirements:
9. Requires the hospital and OSHDP, using the submitted construction schedule, to identify at least two major milestones relating to the compliance plan that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
10. Requires failure to comply with the application requirements, obtain a building permit, start construction by April 1, 2020, or meet any agreed upon milestone, to result in the assessment of a $5,000 fine per calendar day until the requirements or milestones are met; and,
11. Requires final seismic compliance to be achieved by July 1, 2022.
12. Requires OSHPD, for a hospital that seeks an extension for compliance based on a rebuild plan, to grant an extension of up to five years. Requires the owner to submit by July 1, 2020, in a manner acceptable to OSHPD, the rebuild plan, deemed ready for review, and to submit a construction schedule, obtain a building permit, and begin construction by January 1, 2022. Establishes the following additional requirements for an extension based on a rebuild plan:
13. Requires the hospital and OSHPD to identify at least two major milestones that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
14. Requires failure to comply with requirements to submit the rebuild plan or the construction schedule, obtain a building permit, begin construction by January 1, 2022, or meet any agreed upon milestone, to result in the assessment of a $5,000 fine per calendar day until the requirements or milestones are met;
15. Permits OSHPD, for a hospital that had previously submitted a rebuild project under construction, to accept certification from the hospital that it has obtained appropriate building permits consistent with an approved incremental plan review and that construction has commenced and is continuing. Requires the previously approved construction schedule to be amended to reflect the extension being requested, and at least two new major milestones to be identified. Subjects failure to comply with any of these requirements or the two new milestones to the $5,000 fine specified above. Prohibits the hospital owner from being required to resubmit construction plans previously submitted, and prohibits OSHPD from imposing new or different requirements for an increment already approved or building permit already issued by OSHPD as a condition for granting an extension; and,
16. Requires final seismic compliance to be achieved, and a certificate of occupancy obtained, by January 1, 2025.
17. Permits OSHPD to grant an adjustment to the deadlines to meet the requirements or milestones of the extension request as necessary to deal with contractor, labor, or material delays, or with acts of God, or with governmental entitlements, experiences by the hospital. Prohibits the adjustment from exceeding the final seismic compliance dates of July 1, 2022 for replacement or retrofit plans, and January 1, 2025 for rebuild plans.
18. Requires the hospital, if an adjustment in 6) above is granted, to submit a revised construction schedule, and along with OSHPD, identify two new milestones, consistent with the adjustment. Requires failure to comply with the revised schedule or milestones to result in $5,000 penalties per calendar day.
19. Prohibits the duration of an extension granted by OSHPD from exceeding the maximum of July 1, 2022 for replacement or retrofit plans, and January 1, 2025 for rebuild plans, and within these limits, prohibits OSHPD from granting an extension that exceeds the amount of time needed by the owner to come into compliance. Requires the determination by OSHPD regarding the length of the extension to be based on a showing by the owner of the facts necessitating the additional time, and to include a review of the plan and all documentation submitted in the application, and to permit only that additional time necessary to allow the owner to deal with compliance plan issues that cannot be fully met without the extension.
20. Prohibits an extension from being granted for seismic compliance based on a removal plan.
21. Prohibits an extension of the seismic safety requirements from being granted under this bill unless the hospital has submitted a seismic compliance plan to OSHPD by January 1, 2018.
22. Requires a hospital granted an extension under this bill, in lieu of the specified annual seismic status reports under existing law, to provide a quarterly status report to OSHPD, with the first report due on July 1, 2019, and every October 1, January 1, April 1, and July 1 thereafter, until seismic compliance is achieved. Requires OSHPD to post the status reports on its Web site.
23. Requires OSHPD, before June 1, 2019, to provide the Legislature with an inventory of the SPC category of each hospital building.
24. Permits a hospital assessed a penalty under this bill to appeal the assessment to the Hospital Building Safety Board, provided the hospital posts the funds for any penalties with OSHPD, to be held pending the resolution of the appeal. Requires any penalties assessed under this bill to be deposited into the General Fund within 45 days of assessment or within 45 days following a determination on appeal, if any.
25. Permits OSHPD to revoke an extension granted under this bill for a hospital building where the assessment for a penalty exceeds 60 days.
26. Prohibits OSHPD from issuing a construction final or certificate of occupancy for the building until all assessed penalties accrued have been paid in full or, if an appeal is pending, have been posted subject to resolution of the appeal. Requires penalties deposited by the hospital to be considered paid in full for purposes of issuing a construction final or certificate of occupancy.
27. Permits OSHPD to promulgate emergency regulations as necessary to implement this bill.
28. Requires the owner of an acute care inpatient hospital whose building does not substantially comply with the seismic safety regulations that are required as of January 1, 2030, as specified, to submit to OSHPD an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance.

Comments

1. Author’s statement. According to the author, our hospitals are essential healthcare partners in our communities. The requirement for hospitals to remain standing after a major earthquake ensures they will continue to be a resource to our community after a disaster. Almost all of California’s hospitals have met this requirement. This bill will allow the last remaining few hospitals to meet the mandate without fear of closure should they have a construction or financing delay. Additionally, the bill includes strong penalties to ensure these hospitals stay on track in meeting this important mandate.
2. Hospital seismic requirements. Following the 1971 San Fernando Valley earthquake, California enacted the Alquist Act, which mandated that all new hospital construction meet stringent seismic safety standards. In 1994, after the Northridge earthquake, SB 1953 (Alquist, Chapter 740, Statutes of 1994) required OSHPD to establish earthquake performance categories for hospitals, and established a January 1, 2008, deadline by which general acute care hospitals must be retrofitted or replaced so that they do not pose a risk of collapse in the event of an earthquake, and a January 1, 2030, deadline by which they must be capable of remaining operational following an earthquake. Subsequent legislation allowed most hospitals to qualify for an extension of the January 1, 2008 deadline to January 1, 2013.
   
   OSHPD categorizes hospitals into five Structural Performance Categories (SPCs). SPC-1 is the category of buildings at most risk of collapse in an earthquake, and it is these hospitals that were originally required to be taken out of service or retrofitted by January 1, 2008, which has since been extended for some hospitals to January 1, 2020. Buildings in SPC-2, 3, 4, and 5 are generally categorized based on when they were built and the building code regulations in effect at that time. Hospital buildings in any of these categories may be used up until January 1, 2030, at which time hospitals must either meet SPC-5 requirements, or under recently adopted regulations, the new category of SPC-4D. SPC-5 generally requires new construction for any building constructed before 1989, while SPC-4D allows for some more recently constructed buildings to be retrofitted and still be compliant with January 1, 2030 standards.

In addition to the original five-year extension to January 1, 2013, the Legislature has passed additional bills allowing hospitals to extend the deadlines for retrofitting SPC 1 buildings beyond the 2013 deadline. SB 306 (Ducheny, Chapter 642, Statutes of 2007), permitted a hospital owner to comply with seismic safety deadlines and requirements in current law by replacing all of its buildings subject to seismic retrofit by January 1, 2020, rather than retrofitting by 2013 and replacing them by 2030, if the hospital meets several conditions and OSHPD certifies that the hospital owner lacks the financial capacity to meet seismic standards, as defined. SB 90 (Steinberg, Chapter 19, Statutes of 2011), allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years (no later than January 1, 2020) based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.

1. Current status of SPC 1 seismic compliance in California. According to OSHPD, there are 76 hospital facilities that have SPC 1 buildings still in patient service, with a cumulative total of 184 buildings. These facilities have already received extensions authorized pursuant to either SB 90 or SB 306. In some cases, there are no plans to retrofit or rebuild, but simply take out of service. According to OSHPD, of these 76 facilities, there are 20 to 23 facilities that have one or more SPC-1 buildings that OSHPD has some concern about making the 2020 deadline, but it is too early to say how many of these OSHPD should be “highly concerned” about.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT: (Verified 8/24/18)

California Hospital Association (source)

Adventist Health

Alliance of Catholic Health Care

California Children’s Hospital Association

Loma Linda University Health

Private Essential Access Community Hospitals

OPPOSITION: (Verified 8/24/18)

California Nurses Association

ARGUMENTS IN SUPPORT: The California Hospital Association (CHA) is sponsoring this bill, stating that more than 90% of California hospitals have achieved seismic compliance. However, approximately two dozen hospitals remain classified as SPC-1, and while some will achieve compliance by 2020, other will need the extensions outlined in this bill to allow them to remain open while they finish their construction projects. CHA notes that this bill includes important benchmarks and penalties to ensure these hospitals stay on track. Private Essential Access Community Hospitals, the Alliance of Catholic Health Care, and Adventist Health all write in support that this bill will preserve access to health care and protect jobs while hospitals take on the challenging task of meeting the state-mandated deadlines and completing ongoing construction projects. Loma Linda University Health states in support that after initially planning and beginning construction on a retrofit plan, it became clear that to maximize cost effectiveness, it should construct a new hospital complex instead. Construction on the main hospital began in 2016, and that $250 million has been spent implementing the seismic compliance plan, and construction is making progress. However, due to OSHPD approval timelines and other common issues involved in construction projects this massive, Loma Linda expects construction to be completed by the end of 2020, a year later than its approved extension through December of 2019.

ARGUMENTS IN OPPOSITION: The California Nurses Association (CNA) is opposed unless amended because recent amendments effectively stop Community Hospital Long Beach (CHLB) from being able to apply for an extension under this bill while allowing 27 other hospitals to file for deadline extensions. CNA states that it represents nurses who work at CHLB, which recently closed its doors in July of this year due to a decision by the hospital’s former operator not to bring the facility up to seismic safety requirements. CNA states that it, along with community advocates, has been leading an effort to re-open the hospital, and that there are operators that are willing to pay for seismic compliance. However, recent amendments would preclude CHLB, should it –re-open, from being able to request a seismic extension.

ASSEMBLY FLOOR: 70-0, 5/25/18

AYES: Acosta, Aguiar-Curry, Baker, Berman, Bigelow, Bloom, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Kiley, Lackey, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Santiago, Mark Stone, Thurmond, Ting, Voepel, Weber, Wood, Rendon

NO VOTE RECORDED: Travis Allen, Arambula, Bonta, Brough, Levine, Mullin, Steinorth, Waldron

Prepared by:

8/27/18 18:53:28

**** END ****

 THIRD READING  

Bill No: AB 2190

Author:

:

Vote:

SENATE HEALTH COMMITTEE: 9-0, 6/27/18

AYES: Pan, Nguyen, Beall, Hernandez, Leyva, Mitchell, Monning, Nielsen, Roth

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 70-0, 5/25/18 (Consent) - See last page for vote

SUBJECT:

SOURCE: California Hospital Association

DIGEST:

This bill provides for an extension of the January 1, 2020 hospital seismic safety deadline of up to 30 months (until July 1, 2022) for hospitals that plan to replace or retrofit a building to at least the 2020 standard of SPC-2, and up to five years (January 1, 2025) for hospitals that plan to rebuild to SPC-4D or SPC-5 standards that meet 2030 standards.

ANALYSIS:

Existing law:

1. Establishes the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 (Alquist Act), to ensure that hospital buildings are designed and constructed to resist the forces generated by earthquakes and requires the Office of Statewide Health Planning and Development (OSHPD) to propose building standards for earthquake resistance and to provide independent review of the design and construction of hospital buildings. [HSC §129675, et seq.]
   
2. Establishes timelines for hospital compliance with seismic safety standards, including a requirement that buildings posing a significant risk of collapse and a danger to the public (referred to as SPC -1 buildings) be rebuilt or retrofitted to be capable of withstanding an earthquake, or removed from acute care service, by January 1, 2008, and a requirement that hospital buildings be capable of remaining intact after an earthquake, and must also be capable of continued operation by January 1, 2030. [HSC §130060, §130065]
3. Permits OSHPD to grant an extension of up to five years to the 2008 deadline, which would be January 1, 2013, for hospitals for which compliance will result in a loss of health care capacity, as defined. Allows OSHPD to grant various further extensions beyond this, including up to seven years to January 1, 2020, in part based on the loss of essential hospital services to the community if the hospital closed, and financial hardship. [HSC §130060, §130061.5]

This bill:

1. Defines the following terms for purposes of this bill:
2. “rebuild plan” is a plan to meet seismic standards primarily by constructing a new conforming SPC-5 building for use in lieu of an SPC-1 building;
3. “removal plan” is a plan to meet seismic standards primarily by removing acute care services or beds from the hospital’s license;
4. “replacement plan” is a plan to meet seismic standards primarily by relocating acute care services or beds from nonconforming buildings into a conforming building; and,
5. “retrofit plan” is a plan to meet seismic standards primarily by modifying the building in a manner that brings the building up to SPC-2, SPC-4D, or SPC-5 standards.
6. Permits a hospital owner that has been granted an extension, to January 1, 2020, of the seismic safety requirements to rebuild or retrofit SPC-1 buildings, to request an additional extension of time as provided in this bill.
7. Requires all hospitals seeking an extension for their SPC-1 buildings to submit to OSHPD an application, in a manner acceptable to OSHPD, by April 1, 2019. Requires the application, at a minimum, to state which of the seismic compliance methods, as defined in this bill, will be used for each SPC-1 building.
8. Requires a hospital that is seeking an extension for compliance based on a replacement or retrofit plan, to submit a construction schedule, obtain a building permit, and begin construction by April 1, 2020. For a replacement or retrofit plan, establishes the following additional requirements:
9. Requires the hospital and OSHDP, using the submitted construction schedule, to identify at least two major milestones relating to the compliance plan that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
10. Requires failure to comply with the application requirements, obtain a building permit, start construction by April 1, 2020, or meet any agreed upon milestone, to result in the assessment of a $5,000 fine per calendar day until the requirements or milestones are met; and,
11. Requires final seismic compliance to be achieved by July 1, 2022.
12. Requires OSHPD, for a hospital that seeks an extension for compliance based on a rebuild plan, to grant an extension of up to five years. Requires the owner to submit by July 1, 2020, in a manner acceptable to OSHPD, the rebuild plan, deemed ready for review, and to submit a construction schedule, obtain a building permit, and begin construction by January 1, 2022. Establishes the following additional requirements for an extension based on a rebuild plan:
13. Requires the hospital and OSHPD to identify at least two major milestones that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
14. Requires failure to comply with requirements to submit the rebuild plan or the construction schedule, obtain a building permit, begin construction by January 1, 2022, or meet any agreed upon milestone, to result in the assessment of a $5,000 fine per calendar day until the requirements or milestones are met;
15. Permits OSHPD, for a hospital that had previously submitted a rebuild project under construction, to accept certification from the hospital that it has obtained appropriate building permits consistent with an approved incremental plan review and that construction has commenced and is continuing. Requires the previously approved construction schedule to be amended to reflect the extension being requested, and at least two new major milestones to be identified. Subjects failure to comply with any of these requirements or the two new milestones to the $5,000 fine specified above. Prohibits the hospital owner from being required to resubmit construction plans previously submitted, and prohibits OSHPD from imposing new or different requirements for an increment already approved or building permit already issued by OSHPD as a condition for granting an extension; and,
16. Requires final seismic compliance to be achieved, and a certificate of occupancy obtained, by January 1, 2025.
17. Permits OSHPD to grant an adjustment to the deadlines to meet the requirements or milestones of the extension request as necessary to deal with contractor, labor, or material delays, or with acts of God, or with governmental entitlements, experiences by the hospital. Prohibits the adjustment from exceeding the final seismic compliance dates of July 1, 2022 for replacement or retrofit plans, and January 1, 2025 for rebuild plans.
18. Requires the hospital, if an adjustment in 6) above is granted, to submit a revised construction schedule, and along with OSHPD, identify two new milestones, consistent with the adjustment. Requires failure to comply with the revised schedule or milestones to result in $5,000 penalties per calendar day.
19. Prohibits the duration of an extension granted by OSHPD from exceeding the maximum of July 1, 2022 for replacement or retrofit plans, and January 1, 2025 for rebuild plans, and within these limits, prohibits OSHPD from granting an extension that exceeds the amount of time needed by the owner to come into compliance. Requires the determination by OSHPD regarding the length of the extension to be based on a showing by the owner of the facts necessitating the additional time, and to include a review of the plan and all documentation submitted in the application, and to permit only that additional time necessary to allow the owner to deal with compliance plan issues that cannot be fully met without the extension.
20. Prohibits an extension from being granted for seismic compliance based on a removal plan.
21. Requires a hospital granted an extension under this bill, in lieu of the specified annual seismic status reports under existing law, to provide a quarterly status report to OSHPD, with the first report due on July 1, 2019, and every October 1, January 1, April 1, and July 1 thereafter, until seismic compliance is achieved. Requires OSHPD to post the status reports on its Web site.
22. Requires OSHPD, before June 1, 2019, to provide the Legislature with an inventory of the SPC category of each hospital building.
23. Permits a hospital assessed a penalty under this bill to appeal the assessment to the Hospital Building Safety Board, provided the hospital posts the funds for any penalties with OSHPD, to be held pending the resolution of the appeal. Requires any penalties assessed under this bill to be deposited into the General Fund within 45 days of assessment or within 45 days following a determination on appeal, if any.
24. Permits OSHPD to revoke an extension granted under this bill for a hospital building where the assessment for a penalty exceeds 60 days.
25. Prohibits OSHPD from issuing a construction final or certificate of occupancy for the building until all assessed penalties accrued have been paid in full or, if an appeal is pending, have been posted subject to resolution of the appeal. Requires penalties deposited by the hospital to be considered paid in full for purposes of issuing a construction final or certificate of occupancy.
26. Permits OSHPD to promulgate emergency regulations as necessary to implement this bill.
27. Requires the owner of an acute care inpatient hospital whose building does not substantially comply with the seismic safety regulations that are required as of January 1, 2030, as specified, to submit to OSHPD an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance.

Comments

1. Author’s statement. According to the author, our hospitals are essential healthcare partners in our communities. The requirement for hospitals to remain standing after a major earthquake ensures they will continue to be a resource to our community after a disaster. Almost all of California’s hospitals have met this requirement. This bill will allow the last remaining few hospitals to meet the mandate without fear of closure should they have a construction or financing delay. Additionally, the bill includes strong penalties to ensure these hospitals stay on track in meeting this important mandate.
2. Hospital seismic requirements. Following the 1971 San Fernando Valley earthquake, California enacted the Alquist Act, which mandated that all new hospital construction meet stringent seismic safety standards. In 1994, after the Northridge earthquake, SB 1953 (Alquist, Chapter 740, Statutes of 1994) required OSHPD to establish earthquake performance categories for hospitals, and established a January 1, 2008, deadline by which general acute care hospitals must be retrofitted or replaced so that they do not pose a risk of collapse in the event of an earthquake, and a January 1, 2030, deadline by which they must be capable of remaining operational following an earthquake. Subsequent legislation allowed most hospitals to qualify for an extension of the January 1, 2008 deadline to January 1, 2013.
   
   OSHPD categorizes hospitals into five Structural Performance Categories (SPCs). SPC-1 is the category of buildings at most risk of collapse in an earthquake, and it is these hospitals that were originally required to be taken out of service or retrofitted by January 1, 2008, which has since been extended for some hospitals to January 1, 2020. Buildings in SPC-2, 3, 4, and 5 are generally categorized based on when they were built and the building code regulations in effect at that time. Hospital buildings in any of these categories may be used up until January 1, 2030, at which time hospitals must either meet SPC-5 requirements, or under recently adopted regulations, the new category of SPC-4D. SPC-5 generally requires new construction for any building constructed before 1989, while SPC-4D allows for some more recently constructed buildings to be retrofitted and still be compliant with January 1, 2030 standards.

In addition to the original five-year extension to January 1, 2013, the Legislature has passed additional bills allowing hospitals to extend the deadlines for retrofitting SPC 1 buildings beyond the 2013 deadline. SB 306 (Ducheny, Chapter 642, Statutes of 2007), permitted a hospital owner to comply with seismic safety deadlines and requirements in current law by replacing all of its buildings subject to seismic retrofit by January 1, 2020, rather than retrofitting by 2013 and replacing them by 2030, if the hospital meets several conditions and OSHPD certifies that the hospital owner lacks the financial capacity to meet seismic standards, as defined. SB 90 (Steinberg, Chapter 19, Statutes of 2011), allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years (no later than January 1, 2020) based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.

1. Current status of SPC 1 seismic compliance in California. According to OSHPD, there are 76 hospital facilities that have SPC 1 buildings still in patient service, with a cumulative total of 184 buildings. These facilities have already received extensions authorized pursuant to either SB 90 or SB 306. In some cases, there are no plans to retrofit or rebuild, but simply take out of service. According to OSHPD, of these 76 facilities, there are 20 to 23 facilities that have one or more SPC-1 buildings that OSHPD has some concern about making the 2020 deadline, but it is too early to say how many of these OSHPD should be “highly concerned” about.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT: (Verified 8/2/18)

California Hospital Association (source)

Adventist Health

Alliance of Catholic Health Care

California Children’s Hospital Association

Loma Linda University Health

Private Essential Access Community Hospitals

OPPOSITION: (Verified 8/2/18)

SEIU California

ARGUMENTS IN SUPPORT: The California Hospital Association (CHA) is sponsoring this bill, stating that more than 90% of California hospitals have achieved seismic compliance. However, approximately two dozen hospitals remain classified as SPC-1, and while some will achieve compliance by 2020, other will need the extensions outlined in this bill to allow them to remain open while they finish their construction projects. CHA notes that this bill includes important benchmarks and penalties to ensure these hospitals stay on track. Private Essential Access Community Hospitals, the Alliance of Catholic Health Care, and Adventist Health all write in support that this bill will preserve access to health care and protect jobs while hospitals take on the challenging task of meeting the state-mandated deadlines and completing ongoing construction projects. Loma Linda University Health states in support that after initially planning and beginning construction on a retrofit plan, it became clear that to maximize cost effectiveness, it should construct a new hospital complex instead. Construction on the main hospital began in 2016, and that $250 million has been spent implementing the seismic compliance plan, and construction is making progress. However, due to OSHPD approval timelines and other common issues involved in construction projects this massive, Loma Linda expects construction to be completed by the end of 2020, a year later than its approved extension through December of 2019.

ARGUMENTS IN OPPOSITION: SEIU California opposes this bill unless important safeguards are put back in the bill, and it is amended to ensure swift and complete compliance with California’s seismic safety laws. SEIU states that in the years since the initial requirements were imposed, the hospital industry has lobbied for numerous extensions of these deadlines, and despite widespread compliance, there remains a group of hospitals who have until 2020 to either retrofit, rebuild, or close hospitals at risk of collapse or causing serious injury. SEIU California states that this bill attempts to deal with those hospitals most at risk for collapse as a class, rather than through distinct bills for each individual hospital. SEIU states that while recent amendments include some improvements, such as the attestation that the hospital board is aware of the upcoming 2030 deadline, the amended version also removed important elements that would have ensured a narrowing of this universe to only those hospitals who have up until now shown some good faith attempts and a willingness to comply with the law. Specifically, SEIU California states that under the prior version, the new extensions would only be granted to those hospitals that had already, as of January 1, 2018, communicated their retrofit or replacement plans to OSHPD. SEIU California states that unless this bill is amended to ensure that the new extensions are only open to those hospitals who have attempted to demonstrate some indication of proposed compliance with the law, it must oppose this bill.

ASSEMBLY FLOOR: 70-0, 5/25/18

AYES: Acosta, Aguiar-Curry, Baker, Berman, Bigelow, Bloom, Burke, Caballero, Calderon, Carrillo, Cervantes, Chau, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dahle, Daly, Eggman, Flora, Fong, Frazier, Friedman, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez Fletcher, Gray, Grayson, Harper, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Kiley, Lackey, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Rodriguez, Rubio, Salas, Santiago, Mark Stone, Thurmond, Ting, Voepel, Weber, Wood, Rendon

NO VOTE RECORDED: Travis Allen, Arambula, Bonta, Brough, Levine, Mullin, Steinorth, Waldron

Prepared by:

8/8/18 10:48:08

**** END ****

SENATE COMMITTEE ON HEALTH

Senator Dr. Richard Pan, Chair

BILL NO: AB 2190

SUBJECT: Hospitals: seismic safety

SUMMARY:

Provides for an extension of the January 1, 2020 hospital seismic safety deadline of up to 30 months (until July 1, 2022) for hospitals that plan to replace or retrofit a building to at least the 2020 standard of SPC-2, and up to five years (January 1, 2025) for hospitals that plan to rebuild to SPC-4D or SPC-5 standards that meet 2030 standards.

Existing law:

1. Establishes the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 (Alquist Act), to ensure that hospital buildings are designed and constructed to resist the forces generated by earthquakes and requires the Office of Statewide Health Planning and Development (OSHPD) to propose building standards for earthquake resistance and to provide independent review of the design and construction of hospital buildings. [HSC §129675, et seq.]
   
2. Establishes timelines for hospital compliance with seismic safety standards, including a requirement that buildings posing a significant risk of collapse and a danger to the public (referred to as SPC -1 buildings) be rebuilt or retrofitted to be capable of withstanding an earthquake, or removed from acute care service, by January 1, 2008, and a requirement that hospital buildings be capable of remaining intact after an earthquake, and must also be capable of continued operation by January 1, 2030. [HSC §130060, §130065]
3. Permits OSHPD to grant an extension of up to five years to the 2008 deadline, which would be January 1, 2013, for hospitals for which compliance will result in a loss of health care capacity, as defined. Allows OSHPD to grant various further extensions beyond this, including up to seven years to January 1, 2020, in part based on the loss of essential hospital services to the community if the hospital closed, and financial hardship. [HSC §130060, §130061.5]
4. Permits OSHPD to revoke an extension for any hospital building when it is determined that any information submitted was falsified, or if the hospital failed to meet a milestone, or where the work of construction is abandoned or suspended for a period of at least six months. [HSC §130060]

This bill:

1. Defines the following terms for purposes of this bill:
2. “rebuild plan” is a plan to meet seismic standards primarily by constructing a new conforming to SPC-4D or SPC-5 building for use in lieu of an SPC-1 building;
3. “removal plan” is a plan to meet seismic standards primarily by removing acute care services or beds from the hospital’s license;
4. “replacement plan” is a plan to meet seismic standards primarily by relocating acute care services or beds from nonconforming buildings into a conforming building; and,
5. “retrofit plan” is a plan to meet seismic standards primarily by modifying the building in a manner that brings the building up to SPC-2, SPC-4D, or SPC-5 standards.
6. Permits a hospital owner that has been granted an extension, to January 1, 2020, of the seismic safety requirements to rebuild or retrofit SPC-1 buildings, to request an additional extension of time as provided in this bill.
7. Requires all hospitals seeking an extension for their SPC-1 buildings to submit to OSHPD an application, in a manner acceptable to OSHPD, by April 1, 2019. Requires the application, at a minimum, to state which of the seismic compliance methods, as defined in this bill, will be used for each SPC-1 building. Requires a hospital that has previously submitted a request for an extension beyond January 1, 2020, based on legislation granting a hospital in Tarzana an extension to October 1, 2022, to certify that extension request in its application.
8. Requires OSHPD, for a hospital that seeks an extension for compliance based on a replacement or retrofit plan, to grant an extension of up to 30 months if the owner agrees in writing to submit a construction schedule, obtain a building permit, and begin construction by April 1, 2020. For a replacement or retrofit plan, establishes the following additional requirements:
9. Requires the application to include a project schedule with timelines for plan submittal and review, if applicable, obtaining a building permit, and start of construction;
10. Requires the hospital and OSHDP to identify at least two major milestones relating to the compliance plan that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
11. Requires failure to comply with the application requirements, obtain a building permit, start construction by April 1, 2020, or meet any agreed upon milestone, to result in the assessment of a $5,000 fine per calendar day until the requirements or milestones are met; and,
12. Requires final seismic compliance to be achieved by July 1, 2022.
13. Requires OSHPD, for a hospital that seeks an extension for compliance based on a rebuild plan, to grant an extension of up to five years if the owner agrees to submit by July 1, 2020, in a manner acceptable to OSHPD, the rebuild plan, deemed ready for review, and to submit a construction schedule, obtain a building permit, and begin construction by January 1, 2022. Establishes the following additional requirements for an extension based on a rebuild plan:
14. Requires the hospital and OSHPD to identify at least two major milestones that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
15. Requires failure to comply with requirements to submit the rebuild plan or the construction schedule, obtain a building permit, begin construction by January 1, 2022, or meet any agreed upon milestone, to result in the assessment of a $5,000 fine per calendar day until the requirements or milestones are met;
16. Permits OSHPD, for a hospital that had previously submitted a request based on legislation granting a hospital in Tarzana an extension to October 1, 2022, to accept certification from the hospital that it has obtained appropriate building permits consistent with an approved incremental plan review and that construction has commenced and is continuing. Requires the previously approved construction schedule to be amended to reflect the extension being requested, and at least two new major milestones to be identified. Subjects failure to comply with any of these requirements or the two new milestones to the $5,000 fine specified above. Prohibits the hospital owner from being required to resubmit construction plans previously submitted, and prohibits OSHPD from imposing new or different requirements for an increment already approved or building permit already issued by OSHPD as a condition for granting an extension; and,
17. Requires final seismic compliance to be achieved, and a certificate of occupancy obtained, by January 1, 2025.
18. Permits OSHPD to grant an adjustment to the deadlines to meet the requirements or milestones of the extension request as necessary to deal with contractor, labor, or material delays, or with acts of God, or with governmental entitlements, experiences by the hospital. Prohibits the adjustment from exceeding the final seismic compliance dates of July 1, 2022 for replacement or retrofit plans, and January 1, 2025 for rebuild plans.
19. Requires the hospital, if an adjustment in 6) above is granted, to submit a revised construction schedule, and along with OSHPD, identify two new milestones, consistent with the adjustment. Requires failure to comply with the revised schedule or milestones to result in $5,000 penalties per calendar day.
20. Prohibits the duration of an extension granted by OSHPD from exceeding the maximum of July 1, 2022 for replacement or retrofit plans, and January 1, 2025 for rebuild plans, and within these limits, prohibits OSHPD from granting an extension that exceeds the amount of time needed by the owner to come into compliance. Requires the determination by OSHPD regarding the length of the extension to be based on a showing by the owner of the facts necessitating the additional time, and to include a review of the plan and all documentation submitted in the application, and to permit only that additional time necessary to allow the owner to deal with compliance plan issues that cannot be fully met without the extension.
21. Prohibits an extension from being granted for seismic compliance based on a removal plan.
22. Requires a hospital granted an extension under this bill, in lieu of the specified annual seismic status reports under existing law, to provide a quarterly status report to OSHPD, with the first report due on July 1, 2019, and every October 1, January 1, April 1, and July 1 thereafter, until seismic compliance is achieved. Requires OSHPD to post the status reports on its Web site.
23. Requires OSHPD, before June 1, 2019, to provide the Legislature with an inventory of the SPC category of each hospital building.
24. Permits a hospital assessed a penalty under this bill to appeal the assessment to the Hospital Building Safety Board, provided the hospital posts the funds for any penalties to be held by OSHPD pending the resolution of the appeal. Requires any penalties assessed under this bill to be deposited into the General Fund following a determination on appeal, if any.
25. Permits OSHPD to promulgate emergency regulations as necessary to implement this bill.
26. Requires the owner of an acute care inpatient hospital whose building does not substantially comply with the seismic safety regulations that are required as of January 1, 2030, as specified, to submit to OSHPD an attestation that the board of directors of that hospital is aware that the hospital building is required to meet the January 1, 2030, deadline for substantial compliance with those requirements.

FISCAL EFFECT:

According to the Assembly Appropriations Committee: Costs to OSHPD are expected to be minor and absorbable (Hospital Building Fund).

PRIOR VOTES:

COMMENTS:

1. Author’s statement. According to the author, our hospitals are essential healthcare partners in our communities. The requirement for hospitals to remain standing after a major earthquake ensures they will continue to be a resource to our community after a disaster. Almost all of California’s hospitals have met this requirement. This bill will allow the last remaining few hospitals to meet the mandate without fear of closure should they have a construction or financing delay. Additionally, the bill includes strong penalties to ensure these hospitals stay on track in meeting this important mandate.
2. Hospital seismic requirements. Following the 1971 San Fernando Valley earthquake, California enacted the Alquist Act, which mandated that all new hospital construction meet stringent seismic safety standards. In 1994, after the Northridge earthquake, SB 1953 (Alquist, Chapter 740, Statutes of 1994) required OSHPD to establish earthquake performance categories for hospitals, and established a January 1, 2008, deadline by which general acute care hospitals must be retrofitted or replaced so that they do not pose a risk of collapse in the event of an earthquake, and a January 1, 2030, deadline by which they must be capable of remaining operational following an earthquake. Subsequent legislation allowed most hospitals to qualify for an extension of the January 1, 2008 deadline to January 1, 2013.
   
   OSHPD categorizes hospitals into five Structural Performance Categories (SPCs). SPC-1 is the category of buildings at most risk of collapse in an earthquake, and it is these hospitals that were originally required to be taken out of service or retrofitted by January 1, 2008, which has since been extended for some hospitals to January 1, 2020. Buildings in SPC-2, 3, 4, and 5 are generally categorized based on when they were built and the building code regulations in effect at that time. Hospital buildings in any of these categories may be used up until January 1, 2030, at which time hospitals must either meet SPC-5 requirements, or under recently adopted regulations, the new category of SPC-4D. SPC-5 generally requires new construction for any building constructed before 1989, while SPC-4D allows for some more recently constructed buildings to be retrofitted and still be compliant with January 1, 2030 standards.

In addition to the original five-year extension to January 1, 2013, the Legislature has passed additional bills allowing hospitals to extend the deadlines for retrofitting SPC 1 buildings beyond the 2013 deadline. SB 306 (Ducheny, Chapter 642, Statutes of 2007), permitted a hospital owner to comply with seismic safety deadlines and requirements in current law by replacing all of its buildings subject to seismic retrofit by January 1, 2020, rather than retrofitting by 2013 and replacing them by 2030, if the hospital meets several conditions and OSHPD certifies that the hospital owner lacks the financial capacity to meet seismic standards, as defined. SB 90 (Steinberg, Chapter 19, Statutes of 2011), allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years (no later than January 1, 2020) based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.

1. Current status of SPC 1 seismic compliance in California. According to OSHPD, there are 76 hospital facilities that have SPC 1 buildings still in patient service, with a cumulative total of 184 buildings (some facilities have more than one SPC-1 building). These facilities have already received extensions authorized pursuant to either SB 90 or SB 306. In some cases, there are no plans to retrofit or rebuild, but simply take out of service According to OSHPD, of these 76 facilities, there are 20 to 23 facilities that have one or more SPC-1 buildings that OSHPD has some concern about making the 2020 deadline, but it is too early to say how many of these OSHPD should be “highly concerned” about.

1. Related legislation. AB 2591 (O’Donnell) permits a hospital owned by the City of Long Beach to request an additional seismic safety extension before January 1, 2025, of the seismic safety requirement that hospital buildings be rebuilt or retrofitted in order to be capable of withstanding an earthquake. AB 2591 was held without recommendation in Assembly Health Committee.
2. Prior legislation. AB 908 (Dababneh, Chapter 350, Statutes of 2017) permitted Providence Tarzana Medical Center in Los Angeles to request an additional extension, until October 1, 2022, of the seismic safety requirement that hospital buildings be rebuilt or retrofitted in order to be capable of withstanding an earthquake.
   
   AB 81 (Wood, Chapter 63, Statutes of 2015) permitted a hospital in the City of Willits to request an eight-month deadline extension of a seismic safety requirement that hospitals be rebuilt or retrofitted to be capable of withstanding an earthquake, which it is currently required to meet by January 1, 2015, so that this hospital could have until September 1, 2015, to meet this seismic safety requirement.

AB 2557 (Pan, Chapter 821, Statutes of 2014) permitted a hospital located in the Counties of Sacramento, San Mateo, or Santa Barbara or the City of San Jose, that had received an additional extension of the January 1, 2008, seismic safety requirements under specified provisions of existing law to January 1, 2015, to request an additional extension until September 1, 2015, in order to obtain either a certificate of occupancy or a construction final from the OSHPD.

SB 90 (Steinberg, Chapter 19, Statutes of 2011) allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.

SB 499 (Ducheny, Chapter 601, Statutes of 2009) required all general acute care hospitals that have SPC-1 buildings to report to OSHPD by November 1, 2010, and annually thereafter, on the status of their compliance with the seismic safety deadlines.

SB 306 (Ducheny, Chapter 642, Statutes of 2007) amended the Alquist Act to permit hospitals to delay compliance with the July 1, 2008 seismic retro deadline, and the 2013 extension, to the year 2020, by filing a declaration with OSHPD that the owner lacks financial capacity to comply with the law.

SB 1661 (Cox, Chapter 679, Statutes of 2006) authorized an extension of up to an additional two years for hospitals that had already received extensions of the January 1, 2008 seismic safety compliance deadline if specified criteria were met, and required specified hospital reports to be posted on the OSHPD Web site.

1. Support. The California Hospital Association (CHA) is sponsoring this bill, stating that more than 90% of California hospitals have achieved seismic compliance. However, approximately two dozen hospitals remain classified as SPC-1, and while some will achieve compliance by 2020, other will need the extensions outlined in this bill to allow them to remain open while they finish their construction projects. CHA notes that this bill includes important benchmarks and penalties to ensure these hospitals stay on track. Private Essential Access Community Hospitals, the Alliance of Catholic Health Care, and Adventist Health all write in support that this bill will preserve access to health care and protect jobs while hospitals take on the challenging task of meeting the state-mandated deadlines and completing ongoing construction projects. Loma Linda University Health states in support that after initially planning and beginning construction on a retrofit plan, it became clear that to maximize cost effectiveness, it should construct a new hospital complex instead. Construction on the main hospital began in 2016, and that $250 million has been spent implementing the seismic compliance plan, and construction is making progress. However, due to OSHPD approval timelines and other common issues involved in construction projects this massive, Loma Linda expects construction to be completed by the end of 2020, a year later than its approved extension through December of 2019.
2. Oppose unless amended. SEIU California opposes this bill unless important safeguards are put back in the bill, and it is amended to ensure swift and complete compliance with California’s seismic safety laws. SEIU states that in the years since the initial requirements were imposed, the hospital industry has lobbied for numerous extensions of these deadlines, and despite widespread compliance, there remains a group of hospitals who have until 2020 to either retrofit, rebuild, or close hospitals at risk of collapse or causing serious injury. SEIU California states that this bill attempts to deal with those hospitals most at risk for collapse as a class, rather than through distinct bills for each individual hospital. SEIU states that while recent amendments include some improvements, such as the attestation that the hospital board is aware of the upcoming 2030 deadline, the amended version also removed important elements that would have ensured a narrowing of this universe to only those hospitals who have up until now shown some good faith attempts and a willingness to comply with the law. Specifically, SEIU California states that under the prior version, the new extensions would only be granted to those hospitals that had already, as of January 1, 2018, communicated their retrofit or replacement plans to OSHPD. SEIU California states that unless this bill is amended to ensure that the new extensions are only open to those hospitals who have attempted to demonstrate some indication of proposed compliance with the law, it must oppose this bill.
3. Policy comment. As noted by SEIU California, recent amendments removed a requirement that hospitals, in order to qualify for the extensions under this bill, must have submitted a plan by January 1, 2018. If a hospital has chosen to close rather than retrofit or rebuild, it may not have submitted a plan to OSHPD. This issue has been raised in regard to Community Hospital of Long Beach (CHLB), which currently has a seismic deadline of July 1, 2019, and has had no plans to bring its buildings into seismic compliance. CHLB is a 158 bed licensed acute and psychiatric care hospital. MemorialCare has been the operator of CHLB since 2011, while the City of Long Beach owns the physical property. In November of 2017, Memorial indicated it plans to cease acute and psychiatric care services as a method of compliance with its July 1, 2019 seismic deadline. MemorialCare is scheduled to stop operating on July 3^rd of this year. However, the City of Long Beach has been negotiating with a potential new operator, Molina, Wu, Network, LLC, which plans to operate a smaller acute care hospital and emergency room at the facility, and has been trying to get MemorialCare to keep the hospital open until it could be transferred to the new operator. MemorialCare has maintained that transferring management to the proposed new operator could not be done in time to keep the hospital or emergency room open, and there is no alternative to closing.
   
   However, should the City of Long Beach be successful in obtaining a new hospital operator and keeping the hospital open, it would need to meet seismic safety requirements to continue operating past July 1, 2019. As currently drafted, the hospital could seek an extension under this bill, but not if the cut-off for having a plan submitted to OSHPD as of January 1, 2018 is added back to the bill.
4. Author’s amendments. To address stakeholder concerns, the author intends to offer amendments that do the following:
   1. Revise the definition of “rebuild plan” to remove the SPC-4D category, so that it will only mean constructing a new SPC-5 building;
   2. Remove references to a part of the code that was enacted last year by AB 908 that granted Providence Tarzana an extension to October, 1 2022;
   3. Tighten up the requirements for an extension by clarifying that a hospital seeking the 30 month extension for replacement or retrofit plans must have submitted plans, obtained permits, and begun construction by April 1, 2020, and for the five year extension, that the hospital must have submitted a rebuild plan no later than July 1, 2020, and begun construction no later than January 1, 2022; and,
   4. Permit OSHPD to revoke an extension under this bill if the assessed penalties exceed sixty days, and prohibit OSHPD from issuing a construction final or certificate of occupancy until all assessed penalties have been paid in full.

SUPPORT AND OPPOSITION:

Support: California Hospital Association (sponsor)

Adventist Health

Alliance of Catholic Health Care

Loma Linda University Health

Private Essential Access Community Hospitals

Oppose: SEIU California (unless amended)

-- END --

Date of Hearing: May 16, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2190

Author:(Reyes) – As Amended Ver:April 26, 2018

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill establishes a process to bring all hospitals that have been granted extensions to seismic compliance deadlines into compliance by 2022 for retrofits or replacements, or by 2025 for rebuilds. Specifically, this bill:

1. Requires all hospitals with Structural Performance Category 1 (SPC-1) buildings to submit a binding application to the Office of Statewide Health Planning and Development (OSHPD) by July 1, 2019, that states which seismic compliance method — rebuild, remove, replace, or retrofit, as defined — will be used for each SPC-1 building.
2. Requires OSHPD to grant extensions to the seismic safety compliance requirements in the case of rebuilds, replacements, or retrofits, as specified.
3. Requires hospitals to meet construction milestones and submit planning documents, as specified, in order to be granted an extension.
4. Authorizes OSHPD to adopt emergency regulations to implement this bill and requires the department to assess fines if milestones are not met or planning documents not submitted on time, as specified.

FISCAL EFFECT:

Costs to OSHPD are expected to be minor and absorbable (Hospital Building Fund).

COMMENTS:

1. Purpose. This bill establishes a systematic means to bring remaining hospitals into compliance with seismic safety requirements. The bill includes strict oversight and monitoring to ensure plans are submitted and projects stay on schedule. This bill is sponsored by the California Hospital Association (CHA), who notes its members will need the extensions outlined in this bill to allow them to remain open while they finish their construction projects. The bill has no opposition.
2. Background. Following the 1994 Northridge earthquake, seismic requirements for hospitals were strengthened. That year, the state established a schedule for hospitals to meet seismic safety goals. It established Structural Performance Categories (SPCs) to measure a hospital building's risk of collapse, and instituted deadlines for retrofitting or reconstruction. Subsequent legislation has provided for additional seismic compliance extensions. January 1, 2020, is the next major compliance deadline for hospitals at high risk of collapse.

OSHPD works closely with hospitals to monitor plans for seismic compliance. In order to grant prior extensions, OSHPD considered the structural integrity of the building, the loss of essential healthcare services to the community should the hospital be closed, and the financial hardship that the hospital may have experienced.

SPC-1 buildings are at the highest risk of collapse and are considered a threat to public safety, while those categorized as SPC-5 are expected to maintain services even in the case of a severe earthquake.

1. Current status of SPC-1 compliance in California. According to OSHPD, of 78 facilities that have SPC-1 buildings in service, six are not likely to make the 2020 deadline. OSHPD also has concerns about approximately 20 facilities making the 2020 deadline. This bill would establish a closely monitored, structured process to bring these facilities into compliance, while allowing OSHPD to account for unavoidable delays.

Analysis Prepared by: Lisa Murawski / APPR. / (916) 319-2081

Date of Hearing: April 24, 2018

ASSEMBLY COMMITTEE ON HEALTH

Jim Wood, Chair

ABPCA Bill Id:AB 2190

Author:(Reyes) – As Amended Ver:April 16, 2018

SUBJECT: Hospitals: seismic safety.

SUMMARY: Requires all hospitals with Structural Performance Category 1 (SPC-1) buildings to submit a binding application to the Office of Statewide Health Planning and Development (OSHPD) by July 1, 2019 that states which seismic compliance method: rebuild; remove; replace; or, retrofit, as defined, will be used for each SPC-1 building. Requires OSHPD to grant extensions to the seismic safety compliance requirements in the case of rebuilds, replacements, or retrofits, as specified. Specifically, this bill:

1. Defines seismic safety compliance methods as follows:
   1. "Rebuilding plan" as a plan to meet seismic standards primarily by construction a new compliant building for use in lieu of an SPC-1 building;
   2. "Removal plan" as a plan to meet seismic standards primarily by removing acute care service beds from the hospital's license;
   3. "Replacement plan" as a plan to meet seismic standards primarily by relocating acute care service beds from noncompliant buildings into a compliant building; and,
   4. "Retrofit plan" as a plan to meet seismic standards primarily by modifying the building in a manner that brings the building up to SPC-2, SPC-4D, or SPC-5 standards.
2. Requires all hospitals with SPC-1 buildings to submit a binding application to OSHPD by July 1, 2019 that states which seismic compliance method will be used for each SPC-1 building.
3. Requires OSHPD to grant hospitals that have been granted extensions of the January 1, 2020 seismic compliance deadline, an additional extension of time to comply with seismic safety requirements.
4. Allows a hospital that seeks an extension based on a retrofit plan, an extension of up to 30 months if the owner agrees in writing to submit a construction schedule and obtain a building permit by April 1, 2019, and specifies the following:
   1. Authorizes OSHPD to grant an extension as necessary to deal with contractor, labor, or materials delay, if any;
   2. Requires, if an extension is granted pursuant to 4) a) above, the hospital owner to submit a modified construction schedule that identifies at least two major milestones agreed upon by the hospital and OSHPD, that will be used as the basis for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
   3. Specifies that failure to submit the construction documents by July 1, 2019, or meet the milestones agreed to pursuant to 4) b) above, will result in the assessment of a fine of $5,000 per calendar day until the documents are submitted or the milestones are met; and,
   4. Requires final seismic compliance to be achieved by July 1, 2022.
5. Requires OSHPD, for a hospital seeking an extension for compliance of an SPC-1 building based on replacement plan, as defined in 1) c) above, to grant an extension of up to 30 months if the owner agrees in writing to submit a replacement plan by July 1, 2019. Requires the following:
   1. The agreement in 5) above to set forth construction schedules, timelines, and major milestones, related to the replacement plan. Specifies that failure to comply with these provisions or with the terms of the agreement with OSHPD will result in a fine of $5,000 per calendar day; and,
   2. The final seismic compliance to be achieved by July 1, 2022.
6. Requires OSHPD, for a hospital that seeks an extension for compliance based on a rebuild plan, to grant an extension of up to five years if the owner agrees in writing to submit the rebuild plan by July 1, 2020, and to submit a construction schedule, obtain a building permit, and begin construction by January 1, 2022. Places additional requirements on hospitals seeking rebuild extensions as follows:
   1. Requires the construction schedule to identify at least two major milestones, agreed upon by the hospital and OSHPD, that will be used as the basis, for determining whether the hospital is making adequate progress toward meeting the seismic compliance deadline;
   2. Specifies that failure to submit the rebuild plan pursuant to 6) above, or failure to submit construction documents or meet the milestones agreed to with OSHPD by January 1, 2022, will result in the assessment of a fine of $5,000 per calendar day until the documents are submitted or the milestones are met; and,
   3. Requires final seismic compliance to be achieved, and a certificate of occupancy to be obtained, by January 1, 2025.
7. Prohibits the length of an extension granted by OSHPD from exceeding the maximum times permitted by these provisions, and within those limits, prohibits an extension from exceeding the amount of time needed by the owner to come into compliance. Requires the determination by OSHPD regarding the length of the extension to be granted to be based upon a showing by the owner of the facts necessitating the additional time. Requires OSHPD to review the plan and all the documentation submitted in the application for the extension, and permits only that additional time necessary to allow the owner to deal with compliance plan issues that cannot be fully met without the extension.
8. Prohibits an extension from being granted for SPC-1 facilities unless the owner has submitted to OSHPD, by January 1, 2018, a ready-for-review retrofit plan or replacement plan.
9. Prohibits an extension from being granted for seismic compliance based upon a removal plan.
10. Requires a hospital granted an extension to provide a quarterly status report to OSHPD, with the first report due on July 1, 2019, and every October 1, January 1, April 1, and July 1 thereafter, until seismic compliance is achieved. Requires OSHPD to post the status reports on its Internet Website.
11. Requires any fines assessed under this bill to be deposited into the General Fund, following a determination on appeal, if any. Authorizes a hospital to appeal a fine to the Hospital Building Safety Board, provided the hospital posts the funds for any fines to be held by OSHPD pending resolution of the appeal.

EXISTING LAW:

1. Establishes the Alfred E. Alquist Hospital Facilities Seismic Safety Act of 1983 (Alquist Act), to ensure that hospital buildings are designed and constructed to resist the forces generated by earthquakes and requires OSHPD to propose building standards for earthquake resistance and to provide independent review of the design and construction of hospital buildings.
   
2. Establishes timelines for hospital compliance with seismic safety standards, including a requirement that buildings posing a significant risk of collapse and a danger to the public (referred to as SPC-1 buildings) be rebuilt or retrofitted to be capable of withstanding an earthquake, or removed from acute care service, by January 1, 2008, and a requirement that hospital buildings be capable of remaining intact after an earthquake, and capable of continued operation by January 1, 2030.
   
3. Permits OSHPD to grant an extension of up to five years from the 2008 deadline, which would be January 1, 2013, for hospitals for which compliance will result in a loss of health care capacity, as defined. Allows OSHPD to grant further extensions beyond this, including up to seven years, or until January 1, 2020, in part based on the loss of essential hospital services to the community if the hospital closed, and financial hardship.
4. Permits a hospital to continue operating under a deadline extension if either of the following occurs before the end of the extension:
   
   1. A replacement building has been constructed and a certificate of occupancy has been granted by OSHPD for the replacement building; or,
      
   2. A retrofit has been performed on the building and a construction final has been obtained by OSHPD.
      
5. Permits OSHPD to revoke an extension for any hospital building when it is determined that any information submitted was falsified, or if the hospital failed to meet a milestone, or where the work of construction is abandoned or suspended for a period of at least six months.
   

FISCAL EFFECT: This bill has not yet been analyzed by a fiscal committee.

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, "our hospitals are essential healthcare partners in our communities and the requirement for them to remain standing after a major earthquake ensures they will continue to be a resource to our community after a disaster." The author states that almost all of California’s hospitals have met this requirement, and this bill will allow the last remaining few hospitals to meet the mandate without fear of closure should they have a construction or financing delay. The author concludes this bill includes strong penalties to ensure these hospitals stay on track in meeting this important mandate.
2. BACKGROUND.
   1. Hospital seismic requirements. Following the 1971 San Fernando Valley earthquake, California enacted the Alquist Act, which mandated that all new hospital construction meet stringent seismic safety standards. In 1994, after the Northridge earthquake, the Legislature passed and the Governor signed SB 1953 (Alquist), Chapter 740, Statutes of 1994, which required OSHPD to establish earthquake performance categories for hospitals, and established a January 1, 2008, deadline by which general acute care hospitals must be retrofitted or replaced so that they do not pose a risk of collapse in the event of an earthquake; and a January 1, 2030, deadline by which they must be capable of remaining operational following an earthquake. Subsequent legislation allowed most hospitals to qualify for an extension of the January 1, 2008 deadline to January 1, 2013.
      
      OSHPD categorizes hospitals into five SPCs. SPC-1 is the category of buildings at most risk of collapse in an earthquake, and it is these hospitals that were originally required to be taken out of service or retrofitted by January 1, 2008, which has since been extended for some hospitals to January 1, 2020. Buildings in SPC-2, 3, 4, and 5 are generally categorized based on when they were built and the building code regulations in effect at that time. Hospital buildings in any of these categories may be used up until January 1, 2030, at which time hospitals must either meet SPC-5 requirements, or under recently adopted regulations, the new category of SPC-4D. SPC-5 generally requires new construction for any building constructed before 1989, while SPC-4D allows for some older buildings to be retrofitted and still be compliant with January 1, 2030 standards.
      
      In addition to the original five-year extension to January 1, 2013, the Legislature has passed additional bills allowing hospitals to extend the deadlines for retrofitting SPC 1 buildings beyond the 2013 deadline. SB 306 (Ducheny), Chapter 642, Statutes of 2007, permitted a hospital owner to comply with seismic safety deadlines and requirements in current law by replacing all of its buildings subject to seismic retrofit by January 1, 2020, rather than retrofitting by 2013 and replacing them by 2030, if the hospital meets several conditions and OSHPD certifies that the hospital owner lacks the financial capacity to meet seismic standards, as defined. SB 90 (Steinberg), Chapter 19, Statutes of 2011, allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years (no later than January 1, 2020) based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.
      
   2. Current status of SPC-1 compliance in California. According to OSHPD, there are 78 hospital facilities that have SPC-1 buildings still in patient service; with a cumulative total of 191 buildings (some facilities have more than one SPC-1 building). These facilities have already received extensions authorized pursuant to either SB 90 or SB 306. According to OSHPD, of these 78 facilities, six are not likely to make the 2020 deadline, all of which have plans submitted. OSHPD also has concerns about approximately 20 facilities making the 2020 deadline, all of which have plans submitted. OSHPD is aware of two facilities (Pacific Alliance and Community Hospital Long Beach) that have announced they intend to close. The remaining 50 facilities are either close to completion or could make the 2020 deadline.
      

Facilities that OSHPD believes are not likely to complete a retrofit by 2020:

Facilities OSHPD has concerns with completion by 2020: 

Facilities that have announced plans to close or are in the process of closing:

Retrofit = Building will be retrofitted
Rebuild = General Acute Care services will be moved to new building/s
Replace = General Acute Care services will be moved to existing SPC 2 or higher building/s
Remove = General Acute Care services will be removed from building

1. SUPPORT. The California Hospital Association (CHA) is the sponsor of this bill and states that over 90% of California's hospitals have achieved seismic compliance, however, approximately two dozen hospitals remain classified as SPC-1 (potential collapse hazard). CHA notes that some will achieve compliance by 2020, but others will need the extensions outlined in this bill to allow them to remain open while they finish their construction projects.
   
   Loma Linda University Health (LLUH) supports this bill and states that it initially began to retrofit its hospital complex in 1998, however after considerable planning it became clear that to ensure premiere patient safety and to maximize cost effectiveness; LLUH should not retrofit the buildings but develop new construction of a hospital complex. Main hospital construction began in April of 2016. LLUH has an approved plan from OSHPD through December 2019, however due to OSHPD timelines, scope growth, and other common issues involved in large construction projects, construction is expected to be complete by the end of 2020.
2. RELATED LEGISLATION. AB 2591 (O'Donnell) permits a hospital owned by the City of Long Beach to request an additional seismic safety extension before January 1, 2025, of the seismic safety requirement that hospital buildings be rebuilt or retrofitted in order to be capable of withstanding an earthquake. AB 2591 was heard in the Assembly Health Committee on April 14, 2018 and was held in Committee.
3. PREVIOUS LEGISLATION.
   1. AB 908 (Dababneh), Chapter 350, Statutes of 2017, authorizes Providence Tarzana Medical Center in Los Angeles to request an additional extension, until October 1, 2022, of the seismic safety requirement that hospital buildings must be rebuilt or retrofitted in order to be capable of withstanding an earthquake.
   2. AB 81 (Wood), Chapter 63, Statutes of 2015, permitted a hospital in the City of Willits to request an eight-month deadline extension of a seismic safety requirement that hospitals be rebuilt or retrofitted to be capable of withstanding an earthquake, which it is currently required to meet by January 1, 2015, so that this hospital could have until September 1, 2015, to meet this seismic safety requirement.
   3. AB 2557 (Pan), Chapter 821, Statutes of 2014, permitted a hospital located in the Counties of Sacramento, San Mateo, or Santa Barbara or the City of San Jose, that had received an additional extension of the January 1, 2008, seismic safety requirements under specified provisions of existing law to January 1, 2015, to request an additional extension until September 1, 2015, in order to obtain either a certificate of occupancy or a construction final from the OSHPD.
   4. SB 90 allowed a hospital to seek an extension for seismic compliance for its SPC-1 buildings of up to seven years based on the following elements: the structural integrity of the building, the loss of essential hospital services to the community if the hospital closed, and financial hardship.
   5. SB 499 (Ducheny), Chapter 601, Statutes of 2009, required all general acute care hospitals that have SPC-1 buildings to report to OSHPD by November 1, 2010, and annually thereafter, on the status of their compliance with the seismic safety deadlines.
   6. SB 306 amended the Alquist Act to permit hospitals to delay compliance with the July 1, 2008 seismic retro deadline, and the 2013 extension, to the year 2020, by filing a declaration with OSHPD that the owner lacks financial capacity to comply with the law.
   7. SB 1661 (Cox), Chapter 679, Statutes of 2006, authorized an extension of up to an additional two years for hospitals that had already received extensions of the January 1, 2008 seismic safety compliance deadline if specified criteria were met, and required specified hospital reports to be posted on the OSHPD Website.
4. SUGESTED AMENDMENTS. There are drafting errors in the bill including an incorrect cross reference, and an incorrect date. The Committee may also wish to amend the bill to grant OSHPD the authority to promulgate emergency regulations in order to ensure that the definitions of the different methods of seismic compliance contained in this bill are consistent with definitions in current regulations.

REGISTERED SUPPORT / OPPOSITION:

Support
Adventist Health
Alliance of Catholic Health Care
California Hospital Association
Loma Linda University Health
Private Essential Access Community Hospitals

Opposition
None on file.

Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097