The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

Existing law creates the University of California, San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund. Upon appropriation by the Legislature, existing law requires moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of the University of California, San Francisco, School of Medicine in the San Joaquin Valley. Existing law also requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided. Existing law requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500,000,000 to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500,000,000, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus.

This bill would establish the University of California Kern County Medical Education Endowment Fund. Upon appropriation by the Legislature, the bill would require moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing University of California School of Medicine in the County of Kern, and to conduct a feasibility study related to that campus. The bill would similarly require moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs of a branch campus, as provided, and, upon the determination by the Controller that a sufficient balance is achieved and maintained in the endowment fund, would subsequently require moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus, as provided. The bill would similarly require moneys in the endowment fund to be used, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided.

The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

Existing law creates the University of California, San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund. Upon appropriation by the Legislature, existing law requires moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of the University of California, San Francisco, School of Medicine in the San Joaquin Valley. Existing law also requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided. Existing law requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500,000,000 to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500,000,000, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus.

This bill would establish the University of California Kern County Medical Education Endowment Fund. Upon appropriation by the Legislature, the bill would require moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing University of California School of Medicine in the County of Kern, and to conduct a feasibility study related to that campus. The bill would similarly require moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs of a branch campus, as provided, and, upon the determination by the Controller that a sufficient balance is achieved and maintained in the endowment fund, would subsequently require moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus, as provided. The bill would similarly require moneys in the endowment fund to be used, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided.

The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

Existing law creates the University of California, San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund. Upon appropriation by the Legislature, existing law requires moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of the University of California, San Francisco, School of Medicine in the San Joaquin Valley. Existing law also requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided. Existing law requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500,000,000 to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500,000,000, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus.

This bill would establish the University of California Kern County Medical Education Endowment Fund. Upon appropriation by the Legislature, the bill would require moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing University of California School of Medicine in the County of Kern. Kern, and to conduct a feasibility study related to that campus. The bill would similarly require moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs of a branch campus, as provided, and, upon the determination by the Controller that a sufficient balance is achieved and maintained in the endowment fund, would subsequently require moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus, as provided. The bill would similarly require moneys in the endowment fund to be used, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided.

The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

Existing law creates the University of California, San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund. Upon appropriation by the Legislature, existing law requires moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of the University of California, San Francisco, School of Medicine in the San Joaquin Valley. Existing law also requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided. Existing law requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500,000,000 to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500,000,000, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus.

This bill would create establish the University of California San Joaquin Valley Regional Campus Kern County Medical Education Endowment Fund. Upon appropriation by the Legislature, the bill would require moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing University of California School of Medicine in the County of Kern. The bill would similarly require moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs of a branch campus, as provided, and, upon the determination by the Controller that a sufficient balance is achieved and maintained in the endowment fund, would subsequently require moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus, as provided. The bill would similarly require moneys in the endowment fund to be used, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided.

The California Constitution provides that the University of California constitutes a public trust administered by the Regents of the University of California, a corporation in the form of a board, with full powers of organization and government, subject to legislative control only for specified purposes.

Existing law creates the University of California, San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund. Upon appropriation by the Legislature, existing law requires moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of the University of California, San Francisco, School of Medicine in the San Joaquin Valley. Existing law also requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided. Existing law requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500,000,000 to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500,000,000, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus.

This bill would create the University of California San Joaquin Valley Regional Campus Medical Education Endowment Fund. Upon appropriation by the Legislature, the bill would require moneys in the endowment fund to be allocated to the University of California to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing University of California School of Medicine in the County of Kern. The bill would similarly require moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs of a branch campus, as provided, and, upon the determination by the Controller that a sufficient balance is achieved and maintained in the endowment fund, would subsequently require moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus, as provided. The bill would similarly require moneys in the endowment fund to be used, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, to cover the University of Californias estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2357

Author:(Bains)

As Amended Ver:June 24, 2024

Majority vote

SUMMARY

Establishes the University of California (UC) Kern County Medical Education Endowment Fund for the purposes of supporting the operating costs associated with establishing a branch campus of an existing UC Medical School in Kern County.

Senate Amendments

1. Change the name of the fund the measure establishes from the San Joaquin Valley Regional Campus Medical Education Endowment Fund to the UC Kern County Medical Education Endowment Fund.
2. Stipulates that moneys in the Fund can be used to conduct a feasibility study, as specified.

COMMENTS

San Joaquin Valley (SJV). The SJV is defined as encompassing the Fresno, Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, and Tulare counties. The California Health Care Foundation reported in 2021, that the SJV had just 47 primary care physicians per 100,000 residents, short of the US Department of Health and Human Services' recommended supply ratio of 60-80 per 100,000 and the state average of 60 per 100,000 residents.

Further, according to the Healthforce Center at UC San Francisco, the SJV is one of the fastest growing, lowest socioeconomic, and least healthy regions of California. The Healthforce Center released a report, titled, Current & Future Health Profession Workforce Needs in the San Joaquin Valley. The Report finds that the SJV has historically suffered from a shortage of physicians and other critical segments of the region's health professions workforce may not adequate to meet the region's needs. The Report finds that Latinx are underrepresented in most health professions relative to their proportion of the general population, and that large percentages of physicians and psychologists are likely to retire within the next decade.

This measure establishes the UC Kern County Medical Education Endowment Fund in the State Treasury and authorizes that the Fund may receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund, as specified.

UC Medical Education in the SJV. The UC San Francisco (UCSF) Fresno was established in 1975 as a graduate medical education campus of the UCSF School of Medicine, with support from the State Legislature and the Veteran's Administration to address the severe shortage of physicians in California's San Joaquin Valley.

Today, UCSF Fresno is the largest academic physician training program in between San Francisco, Sacramento and Los Angeles. According to the 2022-23 UCSF Fresno Annual Report, Improving Health in the San Joaquin Valley, the graph below reflects the most recent data of UCSF Fresno graduates. Further, as a way for UC Merced (UCM) to begin to build partnerships with existing UC medical schools and facilitate its involvement with academic medicine, UCM partnered with the UC Davis (UCD) School of Medicine to help develop a new medical education program focusing on the health needs of the region. The SJV Program in Medical Education (PRIME) was launched in 2011 by UCD, in partnership with UCSF Fresno and UCM, to recruit and prepare students for future careers in medicine in the SJV. SJV PRIME students complete their basic sciences/pre-clinical education at UCD, then complete most of their required third-year core clerkships at UCSF Fresno, with options for selecting the amount of time spent in the fourth year at UCSF Fresno or UCD. In 2018-19, management and oversight of the SJV PRIME program transitioned from UCD to UCSF.

The UC Merced medical education program project is currently in development and is the university system's newest medical education program. The program's development began more than a decade ago. In 2008, UCM engaged the Washington Advisory Group (WAG) to assist in scoping the planning effort for the new medical school, on the premise that, even with the economic uncertainty brought on by the recession, the question regarding a medical school was not "if" but "when." The WAG report envisioned a three-stage process in developing a fully independent medical school:

1. Establish a pre-baccalaureate Biomedical Education track specifically designed to attract undergraduates of exceptional promise to pursue a BS degree emphasizing the health needs of the SJV and that prepares students for advanced study in all of the health sciences.
2. Establish a branch campus to an existing medical school. This model has been used successfully at other medical schools. For example, the medical school at the UC Riverside was a branch of the UC Los Angeles medical school prior to becoming independent.
3. Obtain licensure as a fully-independent medical school.

According to the Author

"While the University of California [UC] has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UCSF [UC San Francisco] medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County."

The author contends that, "AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation. Increasing opportunities for future physicians to complete medical school in California's medically underserved areas is the first crucial step to addressing the physician shortages in those areas."

Lastly, the author states, "with California facing a significant budget deficit, relying entirely on state funding to create a new medical school could lead to undue delays. Creating an endowment will allow private funding to be leveraged to stand up the medical school as early as practical."

Arguments in Support

As noted by Kaiser Permanente in their support of this measure, "Kern County has long faced challenges in accessing adequate health care resources, which leads to suboptimal health outcomes for its residents. The establishment of a University of California campus in Kern County will not only address the shortage of healthcare professionals, but also contribute to the development of a sustainable and resilient healthcare system. By providing education, training, and research opportunities in the local community, the university can foster a new generation of health care professionals, who are not only academically qualified, but also deeply connected to the unique needs of Kern County."

Arguments in Opposition

According to the UC's "oppose unless amended" letter, "the UC is committed to our current medical education efforts in the Central Valley, which include UCSF Fresno, SJV Programs in Medical Education (PRIME)+, and UC Merced Medical Education. Launching a medical school and obtaining accreditation from the Licensing Committee on Medical Education requires a substantial investment of time, financial support, faculty development, and a strong foundation of clinical partnerships to support student rotations. We have been undergoing this process at UC Merced, with the long-term goal of establishing an intendent medical school at that campus."

FISCAL COMMENTS

According to the Senate Committee on Appropriations:

1. This measure would create an endowment fund to support the annual operating costs for the development, operation, and maintenance of a new branch campus in Kern County.
2. The UC estimates one-time General Fund costs of about $300 million for a new medical education building and ongoing operational General Fund costs of between $40 million and $45 million each year. These costs could be lower to the extent that donations or other non-state funds are provided.
3. The UC estimates that the costs to conduct a feasibility study to provide an assessment of the region for medical evaluation training and evaluate clinical partnership opportunities that meet the specified training requirements is unknown, but could be in the low millions. However, the measure would allow endowment funds to be used for the feasibility study.

VOTES:

ASM HIGHER EDUCATION: 10-0-1

YES: Mike Fong, Ta, Arambula, Boerner, Chen, Essayli, Irwin, Jackson, Muratsuchi, Quirk-Silva

ABS, ABST OR NV: Low

ASM APPROPRIATIONS: 15-0-0

YES: Wicks, Sanchez, Arambula, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Grayson, Haney, Hart, Jim Patterson, Pellerin, Ta, Villapudua

ASSEMBLY FLOOR: 72-0-8

YES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Flora, Mike Fong, Vince Fong, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

ABS, ABST OR NV: Calderon, Cervantes, Megan Dahle, Essayli, Friedman, Holden, Mathis, Luz Rivas

SENATE FLOOR: 39-0-1

YES: Allen, Archuleta, Ashby, Atkins, Becker, Blakespear, Bradford, Caballero, Cortese, Dahle, Dodd, Durazo, Eggman, Glazer, Gonzalez, Grove, Hurtado, Jones, Laird, Limón, McGuire, Menjivar, Min, Newman, Nguyen, Niello, Ochoa Bogh, Padilla, Portantino, Roth, Rubio, Seyarto, Skinner, Smallwood-Cuevas, Stern, Umberg, Wahab, Wiener, Wilk

ABS, ABST OR NV: Alvarado-Gil

UPDATED

VERSION: June 24, 2024

CONSULTANT: Jeanice Warden / HIGHER ED. / (916) 319-3960 FN: 0004558

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 2357

Author:(Bains)

As Amended Ver:June 24, 2024

Majority vote

SUMMARY

Establishes the University of California (UC) Kern County Medical Education Endowment Fund for the purposes of supporting the operating costs associated with establishing a branch campus of an existing UC Medical School in Kern County.

Senate Amendments

1. Change the name of the fund the measure establishes from the San Joaquin Valley Regional Campus Medical Education Endowment Fund to the UC Kern County Medical Education Endowment Fund.
2. Stipulates that moneys in the Fund can be used to conduct a feasibility study, as specified.

COMMENTS

San Joaquin Valley (SJV). The SJV is defined as encompassing the Fresno, Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, and Tulare counties. The California Health Care Foundation reported in 2021, that the SJV had just 47 primary care physicians per 100,000 residents, short of the US Department of Health and Human Services' recommended supply ratio of 60-80 per 100,000 and the state average of 60 per 100,000 residents.

Further, according to the Healthforce Center at UC San Francisco, the SJV is one of the fastest growing, lowest socioeconomic, and least healthy regions of California. The Healthforce Center released a report, titled, Current & Future Health Profession Workforce Needs in the San Joaquin Valley. The Report finds that the SJV has historically suffered from a shortage of physicians and other critical segments of the region's health professions workforce may not adequate to meet the region's needs. The Report finds that Latinx are underrepresented in most health professions relative to their proportion of the general population, and that large percentages of physicians and psychologists are likely to retire within the next decade.

This measure establishes the UC Kern County Medical Education Endowment Fund in the State Treasury and authorizes that the Fund may receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund, as specified.

UC Medical Education in the SJV. The UC San Francisco (UCSF) Fresno was established in 1975 as a graduate medical education campus of the UCSF School of Medicine, with support from the State Legislature and the Veteran's Administration to address the severe shortage of physicians in California's San Joaquin Valley.

Today, UCSF Fresno is the largest academic physician training program in between San Francisco, Sacramento and Los Angeles. According to the 2022-23 UCSF Fresno Annual Report, Improving Health in the San Joaquin Valley, the graph below reflects the most recent data of UCSF Fresno graduates. Further, as a way for UC Merced (UCM) to begin to build partnerships with existing UC medical schools and facilitate its involvement with academic medicine, UCM partnered with the UC Davis (UCD) School of Medicine to help develop a new medical education program focusing on the health needs of the region. The SJV Program in Medical Education (PRIME) was launched in 2011 by UCD, in partnership with UCSF Fresno and UCM, to recruit and prepare students for future careers in medicine in the SJV. SJV PRIME students complete their basic sciences/pre-clinical education at UCD, then complete most of their required third-year core clerkships at UCSF Fresno, with options for selecting the amount of time spent in the fourth year at UCSF Fresno or UCD. In 2018-19, management and oversight of the SJV PRIME program transitioned from UCD to UCSF.

The UC Merced medical education program project is currently in development and is the university system's newest medical education program. The program's development began more than a decade ago. In 2008, UCM engaged the Washington Advisory Group (WAG) to assist in scoping the planning effort for the new medical school, on the premise that, even with the economic uncertainty brought on by the recession, the question regarding a medical school was not "if" but "when." The WAG report envisioned a three-stage process in developing a fully independent medical school:

1. Establish a pre-baccalaureate Biomedical Education track specifically designed to attract undergraduates of exceptional promise to pursue a BS degree emphasizing the health needs of the SJV and that prepares students for advanced study in all of the health sciences.
2. Establish a branch campus to an existing medical school. This model has been used successfully at other medical schools. For example, the medical school at the UC Riverside was a branch of the UC Los Angeles medical school prior to becoming independent.
3. Obtain licensure as a fully-independent medical school.

According to the Author

"While the University of California [UC] has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UCSF [UC San Francisco] medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County."

The author contends that, "AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation. Increasing opportunities for future physicians to complete medical school in California's medically underserved areas is the first crucial step to addressing the physician shortages in those areas."

Lastly, the author states, "with California facing a significant budget deficit, relying entirely on state funding to create a new medical school could lead to undue delays. Creating an endowment will allow private funding to be leveraged to stand up the medical school as early as practical."

Arguments in Support

As noted by Kaiser Permanente in their support of this measure, "Kern County has long faced challenges in accessing adequate health care resources, which leads to suboptimal health outcomes for its residents. The establishment of a University of California campus in Kern County will not only address the shortage of healthcare professionals, but also contribute to the development of a sustainable and resilient healthcare system. By providing education, training, and research opportunities in the local community, the university can foster a new generation of health care professionals, who are not only academically qualified, but also deeply connected to the unique needs of Kern County."

Arguments in Opposition

According to the UC's "oppose unless amended" letter, "the UC is committed to our current medical education efforts in the Central Valley, which include UCSF Fresno, SJV Programs in Medical Education (PRIME)+, and UC Merced Medical Education. Launching a medical school and obtaining accreditation from the Licensing Committee on Medical Education requires a substantial investment of time, financial support, faculty development, and a strong foundation of clinical partnerships to support student rotations. We have been undergoing this process at UC Merced, with the long-term goal of establishing an intendent medical school at that campus."

FISCAL COMMENTS

According to the Senate Committee on Appropriations:

1. This measure would create an endowment fund to support the annual operating costs for the development, operation, and maintenance of a new branch campus in Kern County.
2. The UC estimates one-time General Fund costs of about $300 million for a new medical education building and ongoing operational General Fund costs of between $40 million and $45 million each year. These costs could be lower to the extent that donations or other non-state funds are provided.
3. The UC estimates that the costs to conduct a feasibility study to provide an assessment of the region for medical evaluation training and evaluate clinical partnership opportunities that meet the specified training requirements is unknown, but could be in the low millions. However, the measure would allow endowment funds to be used for the feasibility study.

VOTES:

ASM HIGHER EDUCATION: 10-0-1

YES: Mike Fong, Ta, Arambula, Boerner, Chen, Essayli, Irwin, Jackson, Muratsuchi, Quirk-Silva

ABS, ABST OR NV: Low

ASM APPROPRIATIONS: 15-0-0

YES: Wicks, Sanchez, Arambula, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Grayson, Haney, Hart, Jim Patterson, Pellerin, Ta, Villapudua

ASSEMBLY FLOOR: 72-0-8

YES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Flora, Mike Fong, Vince Fong, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

ABS, ABST OR NV: Calderon, Cervantes, Megan Dahle, Essayli, Friedman, Holden, Mathis, Luz Rivas

UPDATED

VERSION: June 24, 2024

CONSULTANT: Jeanice Warden / HIGHER ED. / (916) 319-3960 FN: 0004558

 THIRD READING  

Bill No: AB 2357

Author: Bains (D)

Amended: 6/24/24 in Senate

Vote: 21

SENATE EDUCATION COMMITTEE: 7-0, 6/19/24

AYES: Newman, Ochoa Bogh, Cortese, Glazer, Gonzalez, Smallwood-Cuevas, Wilk

SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/15/24

AYES: Caballero, Jones, Ashby, Becker, Bradford, Seyarto, Wahab

ASSEMBLY FLOOR: 72-0, 5/22/24 - See last page for vote

SUBJECT: University of California: school of medicine: University of California Kern County Medical Education Endowment Fund

SOURCE: Author

DIGEST:

This bill establishes the University of California (UC) Kern County Medical Education Endowment Fund for the purposes of supporting the operating costs associated with establishing a branch campus of an existing UC Medical School in Kern County.

ANALYSIS:

Existing law:

1. Establishes the UC as a public trust to be administered by the Regents of the UC; and, grants the Regents full powers of organization and government, subject only to such legislative control as may be necessary to insure security of its funds, compliance with the terms of its endowments, statutory requirements around competitive bidding and contracts, sales of property and the purchase of materials, goods and services. (Article IX, Section (9)(a) of the California Constitution)
2. Creates the UC San Francisco (UCSF), San Joaquin Valley (SJV) Regional Campus Medical Education Endowment Fund. Stipulates that upon appropriation by the Legislature, moneys in the endowment fund must be allocated to the UC to support the annual operating costs for the development, operation, and maintenance of a branch campus of the UC San Francisco, School of Medicine in the San Joaquin Valley.
3. Requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the UC’s estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided.
4. Requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500 hundred million to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500 hundred million, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus. (Education Code Section 92162, et seq.)

This bill:

1. Establishes the UC Kern County Medical Education Endowment Fund in the State Treasury. Funds received by the UC or the Controller, for the purposes of supporting the operating costs of a branch campus of an existing UC School of Medicine in Kern County are to be deposited into the endowment fund.
2. Requires that moneys in the endowment fund be allocated to the UC, upon appropriation by the Legislature, to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in Kern County, to conduct a feasibility to generate funding through investment earnings for the support of medical education in the San Joaquin Valley.
3. Requires that Moneys in the endowment fund be initially invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs associated with a UC Medical School branch campus.
4. Requires, upon the determination of the Controller, in consultation with the UC, that the endowment fund balance has attained the goal established for achieving capital appreciation, that moneys in the endowment fund be invested to generate earnings to fund annual operating costs associated with a UC Medical School branch campus. The bill stipulates that moneys are to be invested in a manner that best meets the goals of the endowment fund.
5. Allows the endowment fund to receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund as may be specified by law.
6. Requires that earnings generated by the endowment fund be retained by the endowment fund.
7. Stipulates that moneys deposited in the endowment fund are exempt from administrative costs, as specified.
8. Requires, upon the determination of the Controller, in consultation with the UC, that the endowment fund has adequate principal to annually yield sufficient investment earnings, from the determination date, to cover the annual costs of a UC Medical School branch campus, the UC to seek approval and accreditation from the Liaison Committee on Medical Education for a UC Medical School in Kern County.
9. Requires, the Controller, upon appropriation by the Legislature, to transfer moneys from the endowment fund to the UC, in an amount equal to the estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education for a UC Medical School branch in Kern County.
10. Requires any funds, public or private, received for or generated by the endowment fund supplement, not supplant any current or future funding. Specifies that any funds allocated from the endowment fund supplement, not supplant, the UC budget allocations for any fiscal year.

Comments

1. Need for the bill. According to the author, “while the University of California [UC] has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UCSF [UC San Francisco] medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County.”

The author contends that, “AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation. Increasing opportunities for future physicians to complete medical school in California’s medically underserved areas is the first crucial step to addressing the physician shortages in those areas.”

Lastly, the author states, “with California facing a significant budget deficit, relying entirely on state funding to create a new medical school could lead to undue delays. Creating an endowment will allow private funding to be leveraged to stand up the medical school as early as practical.”

1. UC Medical Education in the Central Valley. The UCSF Fresno was established in 1975 as a graduate medical education campus of the UCSF School of Medicine, with support from the State Legislature and the Veteran’s Administration, to address the severe shortage of physicians in California’s San Joaquin Valley. Today, UCSF Fresno is the largest academic physician training program between San Francisco, Sacramento, and Los Angeles. Further, as a way for UC Merced (UCM) to begin to build partnerships with existing UC medical schools and facilitate its involvement with academic medicine, UCM partnered with the UC Davis (UCD) School of Medicine to help develop a new medical education program focusing on the health needs of the region. UCD, in partnership with UCSF Fresno and UCM, launched the SJV Program in Medical Education (PRIME) in 2011 to recruit and prepare students for future careers in medicine within the SJV. SJV PRIME students complete their basic sciences/pre-clinical education at UCD, then complete most of their required third-year core clerkships at UCSF Fresno, with options for selecting the amount of time spent in the fourth year at UCSF Fresno or UCD. In 2018-19, management and oversight of the SJV PRIME program transitioned from UCD to UCSF.

This bill establishes a new effort in UC Kern County by creating an endowment fund in the State Treasury and authorizes it to receive donations, contributions, fees, cash advances, and transfers from the General Fund. This includes donations and contributions from both public and private entities, as well as partnerships between the two.

1. Planning for health education at UC Merced. The UC Merced medical education program project is currently in development and is the university system’s newest medical education program. The program's development began more than a decade ago. In 2008, UCM engaged the Washington Advisory Group (WAG) to assist in scoping the planning effort for the new medical school, on the premise that, even with the economic uncertainty brought on by the recession, the question regarding a medical school was not "if" but "when.” The WAG report envisioned a three-stage process in developing a fully independent medical school:

• Establish a pre-baccalaureate Biomedical Education track specifically designed to attract undergraduates of exceptional promise to pursue a BS degree emphasizing the health needs of the SJV and that prepares students for advanced study in all of the health sciences.
• Establish a branch campus to an existing medical school. This model has been used successfully at other medical schools. For example, the medical school at the UC Riverside was a branch of the UC Los Angeles medical school prior to becoming independent.
• Obtain licensure as a fully-independent medical school.

1. Feasibility of a new medical school in Kern County. A substantial barrier for a project such as the one proposed in this bill is assuring sufficient, ongoing resources can support the operating budget of a high-quality UC medical education program. This bill attempts to meet revenue goals by establishing an endowment. Notably, this bill makes no state appropriation. The UC Merced medical school project also underwent significant planning to assess the project's viability and potential success. As such, in order to evaluate opportunities in Kern County, this bill allows the Legislature to appropriate funds from the endowment fund to the UC for conducting a feasibility study. This would provide an opportunity to assess the region's medical education training, cost estimates, and clinical partnership opportunities that meet the training requirements for both medical students and residents.

UC is currently prioritizing its efforts and has requested in their letter of opposition that the bill ensure that an independent medical school be established at UC Merced prior to seeking approval and accreditation for a branch campus of a UC school of medicine in Kern County. This bill does not contain such a provision.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

According to the Senate Appropriations Committee analysis, this bill would have the following fiscal impact:

• This bill would create an endowment fund to support the annual operating costs for the development, operation, and maintenance of a new branch campus in Kern County.
• The UC estimates one-time General Fund costs of about $300 million for a new medical education building and ongoing operational General Fund costs of between $40 million and $45 million each year. These costs could be lower to the extent that donations or other non-state funds are provided.
• The UC estimates that the costs to conduct a feasibility study to provide an assessment of the region for medical evaluation training and evaluate clinical partnership opportunities that meet the specified training requirements is unknown, but could be in the low millions. However, the bill would allow endowment funds to be used for the feasibility study.

SUPPORT: (Verified 8/15/24)

American Pistachio Growers
Blue Shield of California
California Life Sciences
California State Council of Service Employees International Union
City of Bakersfield
County of Kern

CPCA Advocates
Kaiser Permanente
Kern County Superintendent of Schools Office

OPPOSITION: (Verified 8/15/24)

University of California

ASSEMBLY FLOOR: 72-0, 5/22/24

AYES: Addis, Aguiar-Curry, Alanis, Alvarez, Arambula, Bains, Bauer-Kahan, Bennett, Berman, Boerner, Bonta, Bryan, Juan Carrillo, Wendy Carrillo, Chen, Connolly, Davies, Dixon, Flora, Mike Fong, Vince Fong, Gabriel, Gallagher, Garcia, Gipson, Grayson, Haney, Hart, Hoover, Irwin, Jackson, Jones-Sawyer, Kalra, Lackey, Lee, Low, Lowenthal, Maienschein, McCarty, McKinnor, Muratsuchi, Stephanie Nguyen, Ortega, Pacheco, Papan, Jim Patterson, Joe Patterson, Pellerin, Petrie-Norris, Quirk-Silva, Ramos, Rendon, Reyes, Rodriguez, Blanca Rubio, Sanchez, Santiago, Schiavo, Soria, Ta, Ting, Valencia, Villapudua, Waldron, Wallis, Ward, Weber, Wicks, Wilson, Wood, Zbur, Robert Rivas

NO VOTE RECORDED: Calderon, Cervantes, Megan Dahle, Essayli, Friedman, Holden, Mathis, Luz Rivas

Prepared by: Olgalilia Ramirez / ED. / (916) 651-4105

8/18/24 9:07:38

**** END ****

SENATE COMMITTEE ON

Senator Anna Caballero, Chair

2023 - 2024 Regular Session

AB 2357 (Bains) - University of California: school of medicine: University of California Kern County Medical Education Endowment Fund

Bill Summary:

This bill establishes the University of California (UC) Kern County Medical Education Endowment Fund for the purposes of supporting the operating costs associated with establishing a branch campus of an existing UC Medical School in Kern County.

Fiscal Impact:

• This bill would create an endowment fund to support the annual operating costs for the development, operation, and maintenance of a new branch campus in Kern County.
• The UC estimates one-time General Fund costs of about $300 million for a new medical education building and ongoing operational General Fund costs of between $40 million and $45 million each year. These costs could be lower to the extent that donations or other non-state funds are provided.
• The UC estimates that the costs to conduct a feasibility study to provide an assessment of the region for medical evaluation training and evaluate clinical partnership opportunities that meet the specified training requirements is unknown, but could be in the low millions. However, the bill would allow endowment funds to be used for the feasibility study.

Background:

Existing law, under Section 9, Article IX of the State Constitution creates the UC to be administered by the Regents with full powers of organization and government, subject only to such legislative control as may be necessary to ensure security of its funds, compliance with the terms of its endowments, statutory requirements around competitive bidding and contracts, sales of property and the purchase of materials, goods and services.

Existing law creates the UC San Francisco (UCSF), San Joaquin Valley (SJV) Regional Campus Medical Education Endowment Fund. Stipulates that upon appropriation by the Legislature, moneys in the endowment fund must be allocated to the UC to support the annual operating costs for the development, operation, and maintenance of a branch campus of the UC San Francisco, School of Medicine in the San Joaquin Valley. Existing law requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the UC’s estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided. It also requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500 hundred million to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500 hundred million, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus.

Proposed Law:

This bill establishes the UC Kern County Medical Education Endowment Fund in the State Treasury. Funds received by the UC or the Controller, for the purposes of supporting the operating costs of a branch campus of an existing UC School of Medicine in Kern County are to be deposited into the endowment fund. The bill also requires that moneys in the endowment fund be allocated to the UC, upon appropriation by the Legislature, to support the annual operating costs for the development, operation, maintenance of a branch campus of an existing UC School of Medicine in Kern County, to conduct a feasibility study related to the branch campus, and to generate funding through investment earnings for the support of medical education in the San Joaquin Valley.

This bill requires that moneys in the endowment fund be initially invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs associated with a UC Medical School branch campus.

This bill requires, upon the determination of the Controller, in consultation with the UC, that the endowment fund balance has attained the goal established for achieving capital appreciation, that moneys in the endowment fund be invested to generate earnings to fund annual operating costs associated with a UC Medical School branch campus. The bill stipulates that moneys are to be invested in a manner that best meets the goals of the endowment fund.

This bill allows the endowment fund to receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund as may be specified by law. It also requires that earnings generated by the endowment fund be retained by the endowment fund and stipulates that moneys deposited in the endowment fund are exempt from administrative costs, as specified.

This bill requires, upon the determination of the Controller, in consultation with the UC, that the endowment fund has adequate principal to annually yield sufficient investment earnings, from the determination date, to cover the annual costs of a UC Medical School branch campus, the UC to seek approval and accreditation from the Liaison Committee on Medical Education for a UC Medical School in Kern County. This bill also requires, the Controller, upon appropriation by the Legislature, to transfer moneys from the endowment fund to the UC, in an amount equal to the estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education for a UC Medical School branch in Kern County.

This bill requires any funds, public or private, received for or generated by the endowment fund supplement, not supplant any current or future funding. Specifies that any funds allocated from the endowment fund supplement, not supplant, the UC budget allocations for any fiscal year.

Related Legislation:

AB 2202 (Gray, Chapter 756, Statutes of 2018) established the UC San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund to support the annual operating costs of a branch campus of UCSF School of Medicine in the San Joaquin Valley.

Staff Comments:

This bill would create an endowment fund intended to support a school of medicine branch in Kern County. According to the author, “while the University of California has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UC San Francisco medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County.” The author indicates that, “AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation. Increasing opportunities for future physicians to complete medical school in California’s medically underserved areas is the first crucial step to addressing the physician shortages in those areas.”

-- END --

SENATE COMMITTEE ON EDUCATION

Senator Josh Newman, Chair

2023 - 2024 Regular

Bill No: AB 2357 Hearing Date: June 19, 2024

Subject: University of California: school of medicine: University of California Kern County Medical Education Endowment Fund.

SUMMARY

This bill establishes the University of California (UC) Kern County Medical Education Endowment Fund for the purposes of supporting the operating costs associated with establishing a branch campus of an existing UC Medical School in Kern County.

BACKGROUND

Existing law:

1. Establishes the UC as a public trust to be administered by the Regents of the UC; and, grants the Regents full powers of organization and government, subject only to such legislative control as may be necessary to insure security of its funds, compliance with the terms of its endowments, statutory requirements around competitive bidding and contracts, sales of property and the purchase of materials, goods and services. (Article IX, Section (9)(a) of the California Constitution)
2. Creates the UC San Francisco (UCSF), San Joaquin Valley (SJV) Regional Campus Medical Education Endowment Fund. Stipulates that upon appropriation by the Legislature, moneys in the endowment fund must be allocated to the UC to support the annual operating costs for the development, operation, and maintenance of a branch campus of the UC San Francisco, School of Medicine in the San Joaquin Valley;
3. Requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the UC’s estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education, as provided; and,
4. Requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500 hundred million to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500 hundred million, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus. (Education Code Section 92162, et seq.)

ANALYSIS

This bill:

1. Establishes the UC Kern County Medical Education Endowment Fund in the State Treasury. Funds received by the UC or the Controller, for the purposes of supporting the operating costs of a branch campus of an existing UC School of Medicine in Kern County are to be deposited into the endowment fund.
2. Requires that moneys in the endowment fund be allocated to the UC, upon appropriation by the Legislature, to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in Kern County, and to generate funding through investment earnings for the support of medical education in the San Joaquin Valley.
3. Requires that Moneys in the endowment fund be initially invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs associated with a UC Medical School branch campus.
4. Requires, upon the determination of the Controller, in consultation with the UC, that the endowment fund balance has attained the goal established for achieving capital appreciation, that moneys in the endowment fund be invested to generate earnings to fund annual operating costs associated with a UC Medical School branch campus. The bill stipulates that moneys are to be invested in a manner that best meets the goals of the endowment fund.
5. Allows the endowment fund to receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund as may be specified by law.
6. Requires that earnings generated by the endowment fund be retained by the endowment fund.
7. Stipulates that moneys deposited in the endowment fund are exempt from administrative costs, as specified.
8. Requires, upon the determination of the Controller, in consultation with the UC, that the endowment fund has adequate principal to annually yield sufficient investment earnings, from the determination date, to cover the annual costs of a UC Medical School branch campus, the UC to seek approval and accreditation from the Liaison Committee on Medical Education for a UC Medical School in Kern County.
9. Requires, the Controller, upon appropriation by the Legislature, to transfer moneys from the endowment fund to the UC, in an amount equal to the estimated costs of applying for and obtaining approval and accreditation from the Liaison Committee on Medical Education for a UC Medical School branch in Kern County.
10. Requires any funds, public or private, received for or generated by the endowment fund supplement, not supplant any current or future funding. Specifies that any funds allocated from the endowment fund supplement, not supplant, the UC budget allocations for any fiscal year.

STAFF COMMENTS

1. Need for the bill. According to the author, “while the University of California [UC] has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UCSF [UC San Francisco] medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County.”

“The author contends that, “AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation. Increasing opportunities for future physicians to complete medical school in California’s medically underserved areas is the first crucial step to addressing the physician shortages in those areas.”

“Lastly, the author states, “with California facing a significant budget deficit, relying entirely on state funding to create a new medical school could lead to undue delays. Creating an endowment will allow private funding to be leveraged to stand up the medical school as early as practical.”

1. UC Medical Education in the Central Valley. The UCSF Fresno was established in 1975 as a graduate medical education campus of the UCSF School of Medicine, with support from the State Legislature and the Veteran’s Administration, to address the severe shortage of physicians in California’s San Joaquin Valley. Today, UCSF Fresno is the largest academic physician training program between San Francisco, Sacramento, and Los Angeles. Further, as a way for UC Merced (UCM) to begin to build partnerships with existing UC medical schools and facilitate its involvement with academic medicine, UCM partnered with the UC Davis (UCD) School of Medicine to help develop a new medical education program focusing on the health needs of the region. UCD, in partnership with UCSF Fresno and UCM, launched the SJV Program in Medical Education (PRIME) in 2011 to recruit and prepare students for future careers in medicine within the SJV. SJV PRIME students complete their basic sciences/pre-clinical education at UCD, then complete most of their required third-year core clerkships at UCSF Fresno, with options for selecting the amount of time spent in the fourth year at UCSF Fresno or UCD. In 2018-19, management and oversight of the SJV PRIME program transitioned from UCD to UCSF.

The measure establishes the UC Kern County endowment fund in the State Treasury and authorizes it to receive donations, contributions, fees, cash advances, and transfers from the General Fund. This includes donations and contributions from both public and private entities, as well as partnerships between the two.

1. Planning for health education at UC Merced. The UC Merced medical education program project is currently in development and is the university system’s newest medical education program. The program's development began more than a decade ago. In 2008, UCM engaged the Washington Advisory Group (WAG) to assist in scoping the planning effort for the new medical school, on the premise that, even with the economic uncertainty brought on by the recession, the question regarding a medical school was not "if" but "when.” The WAG report envisioned a three-stage process in developing a fully independent medical school:

Establish a pre-baccalaureate Biomedical Education track specifically designed to attract undergraduates of exceptional promise to pursue a BS degree emphasizing the health needs of the SJV and that prepares students for advanced study in all of the health sciences.

Establish a branch campus to an existing medical school. This model has been used successfully at other medical schools. For example, the medical school at the UC Riverside was a branch of the UC Los Angeles medical school prior to becoming independent.

Obtain licensure as a fully-independent medical school.

1. Feasibility of a new medical school in Kern County. A substantial barrier for a project such as the one proposed in this bill is assuring sufficient, ongoing resources can support the operating budget of a high-quality UC medical education program. This bill attempts to meet revenue goals by establishing an endowment. Notably, this bill makes no state appropriation. The UC Merced medical school project also underwent significant planning to assess the project's viability and potential success. As such, in order to evaluate opportunities in Kern County, staff recommends that the bill be amended to allow the Legislature to appropriate funds from the endowment fund to the UC for conducting a feasibility study. This would provide an opportunity to assess the region's medical education training, cost estimates, and clinical partnership opportunities that meet the training requirements for both medical students and residents.
2. Related and prior legislation.

AB 3081 (Arambula, 2024) would have appropriated $15 million from the General Fund to the UC Regents for allocation to the UC, Merced, Medical Education Collaborative, as defined and required the UC Merced Medical Education Collaborative, as a condition of receiving the appropriation, to develop a program, consistent with its mission, and in conjunction with the health facilities of its medical residency programs, to identify eligible medical residents and to assist those medical residents in applying for physician retention programs, as specified. AB 3081 was held in the Assembly Appropriations Committee.

SB 1199 (Roth, 2022) authorizes the UC Regents, upon appropriation by the Legislature, to secure a teaching hospital in the County of Riverside to serve as an academic medical center for the purposes of training UCR School of Medicine students. SB 1199 died in the Assembly Higher Education Committee.

AB 2202 (Gray, Chapter 756, Statutes of 2018), which, in part, established the UCSF SJV Regional Campus Medical Education Endowment Fund to support the annual operating costs of a branch campus of UCSF School of Medicine in the SJV.

AB 2232 (Gray, 2014), AB 174 (Gray, 2015), SB 841 (Cannella, 2014), and SB 131 (Cannella, 2015), all of which appropriated funds for the SJV PRIME Program, were held on the Suspense File in the Senate Committee on Appropriations.

SUPPORT

American Pistachio Growers

California Life Sciences

Kaiser Permanente

Kern County Superintendent of Schools Office

OPPOSITION

None received

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 2357

Author:(Bains)

As Introduced Ver:February 12, 2024

Majority vote

SUMMARY

Establishes the University of California (UC) San Joaquin Valley Regional Campus Medical Education Endowment Fund (SJV Fund).

Major Provisions

1. Establishes the UC SJV Fund in the State Treasury.
2. Requires that funds received by the UC or the State Controller, as specified, must be deposited into the UC SJV Fund.
3. Stipulates that moneys in the SJV Fund must be allocated to the UC, upon appropriation by the Legislature, to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern, and to generate funding through investment earnings for the support of medical education in the San Joaquin Valley.
4. Requires that moneys in the SJV Fund must initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern.
5. Specifies that upon the determination of the State Controller, in consultation with the UC, that the SJV Fund balance has attained the goal established, pursuant to (4) above, moneys in the SJV Fund must be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern. Moneys must be invested in a manner that best meets the goals of the SJV Fund.
6. Authorizes that the SJV Fund may receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund (GF) as may be specified by law.
7. Requires that earnings generated by the SJV Fund must be retained by the SJV Fund.
8. Stipulates that moneys deposited in the SJV Fund are exempt from administrative costs, as specified.
9. Requires, upon the determination of the Controller, in consultation with the UC, that the SJV Fund has adequate principal to annually yield sufficient investment earnings, from the date of determination, to cover the annual costs for the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern, the UC must seek approval and accreditation from the Liaison Committee on Medical Education (LCME) for a branch campus of an existing UC School of Medicine in the County of Kern.
10. Requires the Controller, upon appropriation by the Legislature, to transfer moneys from the SJV Fund to the UC, in an amount equal to the estimated costs of applying for and obtaining approval and accreditation from the LCME for a branch campus of an existing UC School of Medicine in the County of Kern.
11. Stipulates that any funds, public or private, received for or generated by the SJV Fund must supplement, not supplant, any current or future funding. Any funds allocated from the SJV Fund must supplement, not supplant, the UC budget allocations for any fiscal year.
12. Defines "endowment fund" as the UC SJV Fund.

COMMENTS

San Joaquin Valley (SJV). The SJV is defined as encompassing the Fresno, Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, and Tulare counties. The California Health Care Foundation reported in 2021, that the SJV had just 47 primary care physicians per 100,000 residents, short of the US Department of Health and Human Services' recommended supply ratio of 60-80 per 100,000 and the state average of 60 per 100,000 residents.

Further, according to the Healthforce Center at UC San Francisco, the SJV is one of the fastest growing, lowest socioeconomic, and least healthy regions of California. The Healthforce Center released a report, titled, Current & Future Health Profession Workforce Needs in the San Joaquin Valley. The Report finds that the SJV has historically suffered from a shortage of physicians and other critical segments of the region's health professions workforce may not adequate to meet the region's needs. The Report finds that Latinx are underrepresented in most health professions relative to their proportion of the general population, and that large percentages of physicians and psychologists are likely to retire within the next decade.

This measure establishes the UC SJV Fund in the State Treasury and authorizes that the SJV Fund may receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the GF, as specified.

UC Medical Education in the SJV. The UC San Francisco (UCSF) Fresno was established in 1975 as a graduate medical education campus of the UCSF School of Medicine, with support from the State Legislature and the Veteran's Administration to address the severe shortage of physicians in California's San Joaquin Valley.

Today, UCSF Fresno is the largest academic physician training program in between San Francisco, Sacramento and Los Angeles. According to the 2022-23 UCSF Fresno Annual Report, Improving Health in the San Joaquin Valley, the graph below reflects the most recent data of UCSF Fresno graduates. Further, as a way for UC Merced (UCM) to begin to build partnerships with existing UC medical schools and facilitate its involvement with academic medicine, UCM partnered with the UC Davis (UCD) School of Medicine to help develop a new medical education program focusing on the health needs of the region. The SJV Program in Medical Education (PRIME) was launched in 2011 by UCD, in partnership with UCSF Fresno and UCM, to recruit and prepare students for future careers in medicine in the SJV. SJV PRIME students complete their basic sciences/pre-clinical education at UCD, then complete most of their required third-year core clerkships at UCSF Fresno, with options for selecting the amount of time spent in the fourth year at UCSF Fresno or UCD. In 2018-19, management and oversight of the SJV PRIME program transitioned from UCD to UCSF.

According to the Author

"While the University of California [UC] has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UCSF [UC San Francisco] medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County."

The author contends that, "AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation. Increasing opportunities for future physicians to complete medical school in California's medically underserved areas is the first crucial step to addressing the physician shortages in those areas."

Lastly, the author states, "with California facing a significant budget deficit, relying entirely on state funding to create a new medical school could lead to undue delays. Creating an endowment will allow private funding to be leveraged to stand up the medical school as early as practical."

Arguments in Support

As noted by Kaiser Permanente in their support of this measure, "Kern County has long faced challenges in accessing adequate health care resources, which leads to suboptimal health outcomes for its residents. The establishment of a University of California campus in Kern County will not only address the shortage of healthcare professionals, but also contribute to the development of a sustainable and resilient healthcare system. By providing education, training, and research opportunities in the local community, the university can foster a new generation of health care professionals, who are not only academically qualified, but also deeply connected to the unique needs of Kern County."

Arguments in Opposition

None on file.

FISCAL COMMENTS

According to the Assembly Committee on Appropriations:

1. One-time General Fund (GF) cost pressures of about $300 million for a new medical education building and ongoing operational costs of between $40 million and $45 million GF annually, according to UC. Costs would be lower to the extent donations or other non-state funds are provided.
2. According to the Legislative Analyst's Office, the GF faces a structural deficit in the tens of billions of dollars over the next several fiscal years.

VOTES

ASM HIGHER EDUCATION: 10-0-1

YES: Mike Fong, Ta, Arambula, Boerner, Chen, Essayli, Irwin, Jackson, Muratsuchi, Quirk-Silva

ABS, ABST OR NV: Low

ASM APPROPRIATIONS: 15-0-0

YES: Wicks, Sanchez, Arambula, Bryan, Calderon, Wendy Carrillo, Dixon, Mike Fong, Grayson, Haney, Hart, Jim Patterson, Pellerin, Ta, Villapudua

UPDATED

VERSION: February 12, 2024

CONSULTANT: Jeanice Warden / HIGHER ED. / (916) 319-3960 FN: 0003225

Date of Hearing: April 24, 2024

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

ABPCA Bill Id:AB 2357

Author:(Bains) – As Introduced Ver:February 12, 2024

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

SUMMARY:

This bill creates an endowment fund at the State Treasury to collect funding with the goal of supporting a branch campus of a University of California (UC) School of Medicine in Kern County. The Treasury is to accept funding and donations from public and private entities to the endowment fund. Moneys in the endowment fund is to be allocated to the UC, upon appropriation by the Legislature, to support the branch campus.

FISCAL EFFECT:

One-time General Fund (GF) costs of about $300 million for a new medical education building and ongoing operational costs of between $40 million and $45 million GF annually, according to UC. Costs would be lower to the extent donations or other non-state funds are provided.

According to the Legislative Analyst’s Office, the General Fund faces a structural deficit in the tens of billions of dollars over the next several fiscal years.

COMMENTS:

1. Purpose. According to the author:

While the University of California has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UC San Francisco medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County…AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County.

1. Background. Kern County residents have long faced challenges accessing health care. Research indicates training medical professionals in communities with poor health care access can lead to increases in health care access for those communities.

This bill would create an endowment fund intended to support a school of medicine branch in Kern County.

1. Prior Legislation. AB 2202 (Gray), Chapter 756, Statutes of 2018, in part, established the UC San Francisco (UCSF) San Joaquin Valley Regional Campus Medical Education Endowment Fund to support the annual operating costs of a branch campus of UCSF School of Medicine in the San Joaquin Valley.

Analysis Prepared by: Natasha Collins / APPR. / (916) 319-2081

Date of Hearing: April 9, 2024

ASSEMBLY COMMITTEE ON HIGHER EDUCATION

Mike Fong, Chair

ABPCA Bill Id:AB 2357 (

Author:Bains) – As Introduced Ver:February 12, 2024

SUBJECT: University of California: school of medicine: University of California San Joaquin Valley Regional Campus Medical Education Endowment Fund.

SUMMARY: Establishes the University of California (UC) San Joaquin Valley Regional Campus Medical Education Endowment Fund (SJV Fund). Specifically, this bill:

1. Establishes the UC SJV Fund in the State Treasury.
2. Requires that funds received by the UC or the State Controller, as specified, must be deposited into the UC SJV Fund.
3. Stipulates that moneys in the SJV Fund must be allocated to the UC, upon appropriation by the Legislature, to support the annual operating costs for the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern, and to generate funding through investment earnings for the support of medical education in the San Joaquin Valley.
4. Requires that moneys in the SJV Fund must initially be invested with the goal of achieving capital appreciation to create a balance sufficient to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern.
5. Specifies that upon the determination of the State Controller, in consultation with the UC, that the SJV Fund balance has attained the goal established, pursuant to (4) above, moneys in the SJV Fund must be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern. Moneys must be invested in a manner that best meets the goals of the SJV Fund.
6. Authorizes that the SJV Fund may receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the General Fund (GF) as may be specified by law.
7. Requires that earnings generated by the SJV Fund must be retained by the SJV Fund.
8. Stipulates that moneys deposited in the SJV Fund are exempt from administrative costs, as specified.
9. Requires, upon the determination of the Controller, in consultation with the UC, that the SJV Fund has adequate principal to annually yield sufficient investment earnings, from the date of determination, to cover the annual costs for the development, operation, and maintenance of a branch campus of an existing UC School of Medicine in the County of Kern, the UC must seek approval and accreditation from the Liaison Committee on Medical Education (LCME) for a branch campus of an existing UC School of Medicine in the County of Kern.
10. Requires the Controller, upon appropriation by the Legislature, to transfer moneys from the SJV Fund to the UC, in an amount equal to the estimated costs of applying for and obtaining approval and accreditation from the LCME for a branch campus of an existing UC School of Medicine in the County of Kern.
11. Stipulates that any funds, public or private, received for or generated by the SJV Fund must supplement, not supplant, any current or future funding. Any funds allocated from the SJV Fund must supplement, not supplant, the UC budget allocations for any fiscal year.
12. Defines “endowment fund” as the UC SJV Fund.

EXISTING LAW:

1. Establishes the UC as a public trust to be administered by the Regents of the UC; and, grants the Regents full powers of organization and government, subject only to such legislative control as may be necessary to insure security of its funds, compliance with the terms of its endowments, statutory requirements around competitive bidding and contracts, sales of property and the purchase of materials, goods and services (Article IX, Section (9)(a) of the California Constitution).
2. Creates the UC San Francisco, San Joaquin Valley Regional Campus Medical Education Endowment Fund. Stipulates that upon appropriation by the Legislature, moneys in the endowment fund must be allocated to the UC to support the annual operating costs for the development, operation, and maintenance of a branch campus of the UC San Francisco, School of Medicine in the San Joaquin Valley;
3. Requires, upon appropriation by the Legislature and a determination by the Controller of sufficient funds in the endowment fund, moneys in the fund to be used to cover the UC’s estimated costs of applying for and obtaining approval and accreditation from the LCME, as provided; and,
4. Requires moneys in the endowment fund to initially be invested with the goal of achieving capital appreciation to create a balance of $500 hundred million to generate ongoing earnings to cover the estimated annual operating costs associated with the development, operation, and maintenance of the branch campus, and, upon the determination of the Controller that the endowment fund balance is $500 hundred million, requires moneys in the endowment fund to be invested to generate earnings to fund annual operating costs associated with the development, operation, and maintenance of the branch campus (Education Code Section 92162, et seq.).

FISCAL EFFECT: Unknown

COMMENTS: San Joaquin Valley (SJV). The SJV is defined as encompassing the Fresno, Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, and Tulare counties. The California Health Care Foundation reported in 2021, that the SJV had just 47 primary care physicians per 100,000 residents, short of the US Department of Health and Human Services’ recommended supply ratio of 60-80 per 100,000 and the state average of 60 per 100,000 residents.^[1]

Further, according to the Healthforce Center at UC San Francisco, the SJV is one of the fastest growing, lowest socioeconomic, and least healthy regions of California. The Healthforce Center released a report, titled, Current & Future Health Profession Workforce Needs in the San Joaquin Valley. The Report finds that the SJV has historically suffered from a shortage of physicians and other critical segments of the region’s health professions workforce may not adequate to meet the region’s needs. The Report finds that Latinx are underrepresented in most health professions relative to their proportion of the general population, and that large percentages of physicians and psychologists are likely to retire within the next decade.

Need for the measure. According to the author, “while the University of California [UC] has done admirable work in expanding to underserved areas in the San Joaquin Valley and California as a whole, including the creation of a new campus in Merced and a UCSF [UC San Francisco] medical school program in Fresno, there is no mechanism in current law to establish and fund a medical school in Kern County.”

The author contends that, “AB 2357 will lay the foundation for the creation of a University of California medical school in Kern County. The presence of medical schools in a geographic area also increases the opportunities for residency training, the latter of which is highly correlated to where physicians ultimately reside and practice. According to the Association of American Medical Colleges (AAMC), over 77% of physicians who complete residency in California continue to practice in-state, the highest percentage in the nation.^[2] Increasing opportunities for future physicians to complete medical school in California’s medically underserved areas is the first crucial step to addressing the physician shortages in those areas.”

Lastly, the author states, “with California facing a significant budget deficit, relying entirely on state funding to create a new medical school could lead to undue delays. Creating an endowment will allow private funding to be leveraged to stand up the medical school as early as practical.”

This measure establishes the UC SJV Fund in the State Treasury and authorizes that the SJV Fund may receive donations and contributions from public and private entities, partnerships between public and private entities, fees, cash advances, and transfers from the GF, as specified.

UC Medical Education in the SJV. The UC San Francisco (UCSF) Fresno was established in 1975 as a graduate medical education campus of the UCSF School of Medicine, with support from the State Legislature and the Veteran’s Administration to address the severe shortage of physicians in California’s San Joaquin Valley. The graph below, details a brief history of UCSF Fresno.

Source: 2022-23 UCSF Fresno Annual Report, Improving Health in the San Joaquin Valley

Today, UCSF Fresno is the largest academic physician training program in between San Francisco, Sacramento and Los Angeles. According to the 2022-23 UCSF Fresno Annual Report, Improving Health in the San Joaquin Valley, the graph below reflects the most recent data of UCSF Fresno graduates. Further, as a way for UC Merced (UCM) to begin to build partnerships with existing UC medical schools and facilitate its involvement with academic medicine, UCM partnered with the UC Davis (UCD) School of Medicine to help develop a new medical education program focusing on the health needs of the region. The SJV Program in Medical Education (PRIME) was launched in 2011 by UCD, in partnership with UCSF Fresno and UCM, to recruit and prepare students for future careers in medicine in the SJV. SJV PRIME students complete their basic sciences/pre-clinical education at UCD, then complete most of their required third-year core clerkships at UCSF Fresno, with options for selecting the amount of time spent in the fourth year at UCSF Fresno or UCD. In 2018-19, management and oversight of the SJV PRIME program transitioned from UCD to UCSF.

Source: 2022-23 UCSF Fresno Annual Report, Improving Health in the San Joaquin Valley

Arguments in support. As noted by Kaiser Permanente in their support of this measure,

“Kern County has long faced challenges in accessing adequate health care resources, which leads to suboptimal health outcomes for its residents. The establishment of a University of California campus in Kern County will not only address the shortage of healthcare professionals, but also contribute to the development of a sustainable and resilient healthcare system. By providing education, training, and research opportunities in the local community, the university can foster a new generation of health care professionals, who are not only academically qualified, but also deeply connected to the unique needs of Kern County.”

Related legislation. AB 3081 (Arambula), which will be heard by this Committee in a subsequent hearing this month, would, on or before July 1, 2025, and each July 1 thereafter, appropriate $15 million from the GF to the UC Regents for allocation to the UC, Merced, Medical Education Collaborative, as defined. And requires the UC Merced Medical Education Collaborative, as a condition of receiving the appropriation, to develop a program, consistent with its mission, and in conjunction with the health facilities of its medical residency programs, to identify eligible medical residents and to assist those medical residents in applying for physician retention programs, as specified.

Prior legislation. AB 2202 (Gray), Chapter 756, Statutes of 2018, which, in part, established the UCSF San Joaquin Valley Regional Campus Medical Education Endowment Fund to support the annual operating costs of a branch campus of UCSF School of Medicine in the SJV.

AB 2232 (Gray) of 2014, AB 174 (Gray) of 2015, SB 841 (Cannella) of 2014, and SB 131 (Cannella) of 2015, all of which appropriated funds for the SJV PRIME Program, were held on the Suspense File in the Senate Committee on Appropriations.

REGISTERED SUPPORT / OPPOSITION:

Support

California Life Sciences
Kaiser Permanente

Opposition

None on file.

Analysis Prepared by: Jeanice Warden / HIGHER ED. / (916) 319-3960

1. California Health Care Almanac 2021, https://www.chcf.org/wpcontent/uploads/2021/03/PhysiciansAlmanac2021.pdf ↑

2. AAMC Report on Residents, 2023: https://www.aamc.org/data-reports/students-residents/data/report-residents/2023/table-c6-physician-retention-state-residency-training-state ↑