CSAC Bulletin Article

Some Counties Face Urgent AB 85 “True Up” Deadline

August 10, 2017

The California Department of Finance (DoF) has completed its annual “true up” process as required by AB 85 (Chapter 24, Statutes of 2013), and while a few counties will receive additional funding from the state, several others will have to transfer funds from their Health Subaccounts into Family Support Subaccounts soon, or face significant penalties.

AB 85 requires a “true up” of prior fiscal year diversions of 1991 Health Subaccount funding. The DoF has just completed the final determinations for the 2014-15 fiscal year. Under this process, five counties will receive a lump sum repayment of diverted 1991 Health Subaccount funding by October 1. However, fourteen counties owe additional Health Subaccount dollars (counties and amounts are available in this DoF schedule,) and this funding must be transferred from the county’s Health Subaccount to the Family Support Subaccount within three months of receiving the DoF notification letter.

Those notification letters were sent to counties the week of August 17 (view a copy here). Please note that the penalties under AB 85 for failing to transfer the funding within three months include a 50 percent penalty on the amount owed. CSAC, along with the County Health Executives Association, the California Association of Public Health and Hospital Systems, and the County Welfare Directors Association, and with input from the county counsels, has developed a memo outlining the process for transferring the funds.

We urge all counties that owe to immediately coordinate with your Auditor-Controllers for the transfer of the funding; the penalties for not transferring the required amount in full after three months are severe. If you have questions, please contact Farrah McDaid Ting at fmcting@counties.org or (916) 650-8110.

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