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Full text of "Hearing"

SAN FRANCISCO PUBLIC LIBRARY 



3 1223 08678 5202 




San Francisco Public Library 



GOVERNMENT imfop' * , TION CENTER 
SANff-" ..LIBRARY 

100 JyRWs.oiHEEl 
SAN FRANCISCO. CA 94102 

REFERENCE BOOK 

Not to be taken from the Library 







2.7 



HEARING 

SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

WEDNESDAY, AUGUST 6, 2008 

1:32 P.M. 



DOCUMENTS DEPT 






600-R 



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SENATE RULES COMMITTEE 



STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 



ROOM 113 



SACRAMENTO, CALIFORNIA 



WEDNESDAY, AUGUST 6, 2 008 



1 :32 P.M. 



Reported by: 



Evelyn J. Mizak 
Shorthand Reporter 



3 1223 08678 5202 




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APPEARANCES 
MEMBERS PRESENT 



SENATOR DON PERATA, Chair 
SENATOR JIM BATTIN, Vice Chair 
SENATOR GIL CEDILLO 
SENATOR ROBERT DUTTON 
SENATOR ALEX PADILLA 



STAFF PRESENT 



GREG SCHMIDT, Executive Officer 
PAT WEBB, Committee Secretary 
NETTIE SABELHAUS, Appointments Consultant 
JULIE NYSTROM, Consultant to SENATOR BATTIN 
13 DAN SAVAGE, Consultant to SENATOR CEDILLO 
CHRIS BURNS, Consultant to SENATOR DUTTON 
BILL MABIE, Consultant to SENATOR PADILLA 

ALSO PRESENT 



ROBERT "BOBBY" V. McDONALD , Member 
Board of Governors 
California Community Colleges 



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20 SENATOR DICK ACKERMAN 

21 SENATOR LOU CORREA 

SENATOR JACK SCOTT 

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ALICE D. PEREZ, Member 

24 Board of Governors 

California Community Colleges 

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HOWARD POSNER, Vice President 

Board of Directors 

SMUD 



28 DIANA M. BORROEL, CEO 

Sacramento Hispanic Chamber of Commerce 



CAROLE A. HOOD, Chief Deputy Secretary 
Adult Programs 
2 California Department of Corrections and Rehabilitation 



3 RUSTY SELIX, Executive Director 
Mental Health Association of CA 

4 California Council of Community Mental Health Agencies 

PATRICIA RYAN, Executive Director 

6 California Mental Health Directors Association 

7 DAVID WARREN 
Taxpayers for Improving Public Safety (TIPS) 



RICHARD TATUM, State President 

California Correctional Supervisors Organization 



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CHRIS BROWN 

11 Association of Black Correctional Workers 

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INDEX 

Page 

Proceedings 1 

Governor's Appointees: 

The Following Two Nominees Taken Together: 

ROBERT "BOBBY" V. M c DONALD , Member 

Board of Governors 

California Community Colleges 1 

Introduction and Support by: 

SENATOR DICK ACKERMAN 1 

SENATOR LOU CORREA 2 

Background and Experience 6 

Witness in Support: 

SENATOR JACK SCOTT 3 

ALICE D. PEREZ, Member 

Board of Governors 

California Community Colleges 4 

Background and Experience 4 

Questions of Both by SENATOR DUTTON re: 

Assistance and Support for 

Veterans at Community Colleges 8 

Questions of Both by SENATOR PADILLA re: 

Role and Responsibility of Board 

Members, Changes that Can Be 

Effectuated, and Important Issues to 

Be Addressed 10 

Low Transfer Rates to 4 -year 

Universities 13 



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Motion to Confirm Both Appointees 14 

Questions of Both by CHAIRMAN PERATA re: 

Unpreparedness of Students Entering 

College 14 

Possibility of Replicating Taft 
Community College's Program for 
Autistic Children 16 

Ironwood State Prison's Successful 

AA Degree Program for Incarcerated 

Prisoners, and Possibility of 

Replicating that Program in Other 

Communities with Nearby Prisons 17 

Witnesses in Support: 

SENATOR JACK SCOTT 3 

HOWARD POSNER, Vice President 

Board of Directors, SMUD 20 

DIANA BORROEL, CEO 

Sacramento Hispanic Chamber of Commerce 2 

Committee Action 21 

CAROLE A. HOOD, Chief Deputy Secretary 

Adult Programs 

California Department of Corrections & Rehabilitation 21 

Background and Experience 21 

Questions by CHAIRMAN PERATA re: 

Proof Project at Solano State 

Prison 25 

Very Low Reading Levels of Inmates and 
Expectations for Improvement 26 

Questions by SENATOR BATTIN re: 

Current Recidivism Rate for Those 

Inmates Completing Programming 2 7 

Realistic Recidivism Goal 28 



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Status of Riverside Community College's 
Program to Assist Parolees and CDCR' s 
Cooperation in Effort 28 



Request for Update on Dialogue with 

RCC s Proposed Program 3 



3 Number of Other Programs Similar to 

Riverside' s 29 

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AB 900 Funds Directed toward Parolee 

Rehabilitation 3 

Questions by SENATOR DUTTON re 
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Training and Job Placement for 

Parolees 31 



i Direct Contact with Labor Unions 

and Trade Unions 3 2 

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Witnesses in Support: 



15 RUSTY SELIX, Executive Director 

Mental Health Association of California 

California Council of Community Mental 

Health Agencies 32 



PAT RYAN, Executive Director 

California Mental Health Directors Association 32 

DAVID WARREN 

Taxpayers for Improving Public Safety 34 

RICHARD TATUM, State President 

California Correctional Supervisors Organization 36 



23 CHRIS BROWN 

Association of Black Correctional Workers 36 

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Statements by CHAIRMAN PERATA re: 



Three Administrators Recently Left 
California Department of Corrections and 

27 Rehabilitation 37 

28 Disturbing State of the Institution 37 



VI 



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Initially Wanted to Hold Confirmation 

until after Meeting with MATT CATE 3 8 

Nominee's Obvious Understanding of 

Mountainous Goals 3 9 

Response by MS . HOOD : 3 9 

Motion to Confirm 40 

Committee Action 40 

Termination of Proceedings 4 

Certificate of Reporter 41 

APPENDIX : 4 2 

Written Responses to Committee Questions 
By Appointees, as well as Written 
Statements by Appointees Not Required to 
Appear: Members of the California Exposition 
and State Fair Board of Directors : 
MARKO C. MLIKOTIN, KATHLEEN K. NAKASE, and 
AMPARO P. PEREZ -COOK; Members, California 
Student Aid Commission: TOMAS A. ARCINIEGA, 
Ph.D., LYNNE DE BIE, PETER C. HANKWITZ , 
PATRICIA A. KUSHIDA, and BONAPARTE H. LIU 



VII 



P-R-O-C-E-E-D-I-N-G-S 
--00O00- - 

CHAIRMAN PERATA: We now have a quorum. 

We're going to take Item 3(b) out of order 
because we have two highly placed, highly priced Members of the 
Senate, so we'll do that first, then Mr. Cook, because there's 
only one of you . 

Gentlemen, together again for the first time. 
It's great to see you. 

SENATOR ACKERMAN: Mr. Chairman and Committee 
Members, it's the pleasure of Senator Correa and myself to 
introduce and recommend the confirmation of Bobby McDonald to 
the Community College Board. 

I've known Bobby for about -- too long -- about 
3 5 years, back when he was only two years old. I can guarantee 
you're going to get a hard worker in this position. Everything 
that he's been involved in, from community colleges to Cal State 
Fullerton, to the Black Chamber, every activity he's been 
involved in, he takes it and he runs with it, and he brings 
other people along. 

I remember he was responsible for some Titan 
athletic competition. And as soon as he starts calling you, you 
learn very quickly you just say "Yes," otherwise he's going to 
keep calling you until he gets it done. 

CHAIRMAN PERATA: You say "Titan" like everybody 
knows what that is. 

SENATOR ACKERMAN: That's Cal State Fullerton. 
They play in the College World Series once in awhile, and they 



can probably beat the Oakland Athletics if they were 
head-on-head. 

[Laughter. ] 

CHAIRMAN PERATA: That's for sure. 

SENATOR ACKERMAN: Anyway, he ' s a great, great 
person, great family man, a real worker. He ' s a real success 
story in his own right. 

It's my privilege to speak on his behalf. 

CHAIRMAN PERATA: Thank you, Dick. 

SENATOR CORREA: Mr. Chair, I'd just like to 
concur with Senator Ackerman. 

I highly recommend Mr. Bobby Mac to the Community 
College Board. 

It's interesting, trying to remember when I met 
him, and it's almost as though he's always been there. Very 
active in the community, always giving selflessly to all kinds 
of activities. 

The Community College Board, educational, he's 
been around sports, universities, all his life. Cal State 
Fullerton is, my opinion, the Harvard of the West Coast, and one 
of those reasons is Bobby Mac. Tremendous diverse student 
alumni as well as student body, and a lot of that recruitment's 
being done because of Bobby Mac. 

An issue, topic, that's very near and dear to my 
heart in Orange County is the Orange County Human Relations 
Commission and the work they do to reduce racial, ethnic 
tensions and prejudice, discrimination, in Orange County. And 
Bobby Mac is an individual who grew up in South Central L.A. He 



grew up around the Watts riots, and I think that affected him 
and his psyche . He's taken that experience and has been very 
active in that area in Orange County. 

I can't, just can't stop talking about the great 
things he does. I think he's a great guy, and I hope you'll 
support his position, sir. 

CHAIRMAN PERATA: Thank you very much, both. 

We will not expect you to stay for the entire 
meeting. 

Thank you both. 

Mr. Cook, I'm going to ask you to come up in 
deference to your time. 

[Thereafter, the Committee acted 
on legislative agenda items.] 

CHAIRMAN PERATA: Now if Mr. McDonald and 
Ms. Perez would come up we will take you in tandem. 

Senator Scott . 

SENATOR SCOTT: I thought I might say just a kind 
word about these with two candidates. Would you let me do that? 

CHAIRMAN PERATA: Sure. You are a good 
politician. 

SENATOR SCOTT: Well, I just wanted to say that 
I'm very enthusiastically supporting these two individuals who 
have served with such distinction already on the Board of 
Governors for the California Community College: Bobby McDonald 
who is, of course, head of the Black Chamber of Commerce in 
Orange County, and Alice Perez, who is an executive with SMUD. 

I guess one of the things I might say about them 



is that they obviously are people of great judgment. 

CHAIRMAN PERATA: Obviously. 

SENATOR SCOTT: They made a good choice about the 
future Chancellor of the Community College. 

[Laughter. ] 

CHAIRMAN PERATA: Now Jack, you wrote it. I was 
going to say it, I swear. I have it right here. 

[Laughter. ] 

SENATOR SCOTT: But I have had the opportunity to 
get acquainted with them, and I think they are -- I can see why 
the Governor did recommend their appointment. They are 
individuals who, as I said, have already served with distinction 
on the Board of Governors . 

I just wanted to drop by and indicate my 
enthusiastic support of their candidacy. 

CHAIRMAN PERATA: Thank you, Senator. 

It's only down hill from here. We'll allow you 
to go first. 

MS . PEREZ : Thank you . 

Good afternoon, Mr. Chairman and Members. I'm 
very happy to be here today. Thank you for giving me the 
opportunity to come before you. 

My name is Alice Perez. As he mentioned, I am an 
executive at SMUD . I head up their customer strategy group. 

My background entails running a multi -cultural 
banking program for a national bank where I actually implemented 
various strategies to help give individuals access to financial 
services. That also encompassed a very core element of 



1 education as well as outreach. 

2 In addition to that, I serve on several boards in 

3 the local community that focus efforts on workforce development 

4 as well as ensuring that we help strengthen the relationships in 

5 our community through either programs for children to get 

6 through school, from K-12 through the community college, through 
the higher ed, as well as working with workforce development for 

8 some different types of vocational training programs . And then 

9 also working to ensure that I have a very keen understanding of 

10 students themselves. 

11 To me, we can do all this work, but without 

12 really understanding the needs of the students, it's really 

13 ineffective. 

14 I happen to be a mother of five children. And of 

15 those five, four of them have been through the college system. 

16 Two have graduated from UC. Two of them are in community 

17 college, and so I understand first-hand the challenges that 

18 students face. 

19 I also was born and raised in San Francisco. 

20 Unfortunately at different times, you know, you have different 

21 family situations. Sometimes I had great education; sometimes I 

22 had not so wonderful. And in those times, I was fortunate for 

23 me that I had people that believed in me, that helped me to 

24 understand what my opportunities were to advance myself. 

25 I also am a person who attended community college 

26 as well as going on to get my degree. 

2 7 The other thing I do want to say is that I was 

28 married for 23 years to a Lt . Colonel in the Air Force who is a 



veteran, and I totally understand the benefits of the veteran 
program, as well as what it is to be a dependent of a veteran 
and the entitlements that we received as veterans, and I totally 
appreciate that as well. 

So, thank you for allowing me to be here today. 

CHAIRMAN PERATA: Thank you. 

You didn't have to move from San Francisco 
because you're Republican; did you? 

[Laughter. ] 

MS. PEREZ: I moved from San Francisco because my 
husband was in the military, and we came here for training. 

CHAIRMAN PERATA: All right, because I was going 
to talk to the mayor about that . 

Mr. McDonald. 

MR. McDONALD: Mr. Chair and Members, I want to 
thank you very kindly for this opportunity. Thank you also for 
letting my two Senators in my area speak on my behalf earlier. 
Now I'll be even briefer because they gave a pretty nice 
overview. 

I am from Los Angeles, California. I do run the 
Black Chamber of Commerce of Orange County now. 

And by the way, as far as Titans are concerned 
with the Oakland As, Kurt Suzuki is a Titan. 

CHAIRMAN PERATA: I know that. 

MR. McDONALD: But I'm a product of the community 
college system. I went to L.A. Harbor College and then 
transferred to Cal State Fullerton. I'm a veteran. I went to 
Vietnam twice, and so one of the reasons why I'm happy to be 



here on -- for this board is because I am a veteran. I 
understand the community college system. 

I have also was part of the CSU system, where I 
was part of the -- I was President of the Statewide Alumni 
Association, so I have a background with that. 

With the Black Chamber, which I run now, I 
have -- I understand workforce investment and education, plus 
the career technical education component, so I bring the skill 
sets to work, and to make this thing, make this program work, 
and hopefully the board a little bit better if I can. 

I'm just trying to catch up to speed on the 
learning curve to make it work. 

CHAIRMAN PERATA: Jack will take care of that 
when he gets there. Just say yes. 

[Laughter. ] 

CHAIRMAN PERATA: Any questions from anybody 
besides me? 

SENATOR DUTTON: Just a couple. 

Actually, it's just timely in light of Assembly 
Member Cook's item as well, and mentioning, too, your 
experience, both of you, with regards to the military service of 
your husband, and make sure you thank him for us. We appreciate 
it. 

Of course, Bob, your prior military service as 
well . 

You and I, Bob, did talk a little bit about this. 
There ' s been some concerns raised by some of the men and women 
coming home from the service that there doesn't seem to be the 



same level of assistance or support at the community college 
level as I know there was back in the late '60s and early '70s. 

I was curious, do you have any thoughts about how 
we can give better assistance to the veterans that are coming 
back, getting access? Helping them gain access to their GI 
benefits? Is there anything we can do to make sure that the 
community college districts up and down the state actually 
understand the importance of that? Can we give them some 
assistance or guidance as far as how they can better do that, 
and who to work with? 

MR. MCDONALD: I think there's a couple of things 
that we can do . 

Back -- back when I was first came back from 
Vietnam back in '68, I know that they had just started -- well, 
actually in '72, they started putting on the community colleges 
a veteran's officer or a veteran's person, counselor if you 
will, to help out. 

Now of course, with budgets and time constraints 
and stuff, that left and we didn't have a big war. Now we have 
Afghanistan and we have Iraq. So, those things have to come 
into play. 

To better answer your question, there are -- I 
volunteered at the last meeting when we brought up the veteran's 
post -- program to be on that ad hoc, or start that ad hoc 
committee to look at veterans, and looking at counselors, and 
looking at ways that we can get the monies from the federal 
government. I believe there's $25 million on the table to help 
with the situation, because we know that these individuals are 



1 coming back to community colleges because the community college 

2 is the place to start, or their second chance, as it was in my 

3 case, second chance. 

4 MS. PEREZ: I know each of the colleges actually 

5 have an allocated person to help with outreach, and some of them 

6 have actually gone further, where they've actually developed 

7 teams, depending on who their potential audience is, as far as 

8 how many veterans they have in their area. 

9 I think as a board member one of the things that 

10 I can ensure is that we have regular reports, not only of 

11 placing people on the campus, but what are the actual efforts 

12 under way. So, as a result of them being there, what are some 

13 of the activities they're actually participating in very 

14 specific to the outreach that they're doing, because the 

15 awareness is really critical. If people don't know that these 

16 programs are there, and they're aware for them, they don't know 

17 how to access the program. 

18 So to me, part of that is partnering with the 

19 organizations that the veterans tend to be associated with, and 

20 doing outreach activities with them. But then also having 

21 accountability for each of the college campuses to report back 

22 to what specific activities they're participating in. 

23 I like to always say, what you look at is 

24 basically what gets done. So, if we make an effort to track 

25 those things, there'll probably be more activity associated with 
2 6 that. 

2 7 SENATOR DUTTON : Thank you. 

2 8 CHAIRMAN PERATA : Alex. 



SENATOR PADILLA: Just a couple of questions. 

First, I wanted to ask you both to elaborate in 
front of the Committee and in public a little bit of the 
conversation we had in my office when you came by to visit, 
about sort of, you've been on the board for several months now. 
When you were appointed to the board, not just your reasons for 
coming onto the board, but sort of the role and responsibility 
of a board member? And what kind of change you can effectuate 
by serving in this capacity, and how that's maybe changed a 
little bit, or has it clarified a little bit in the months that 
you've been on the board, and how you would take that 
recognition forward on some of the issues that you want to 
address? 

MS. PEREZ: I can start with that. 

Part of the reason I was attracted to the board, 
previously I served on the CSAC Board, where we actually did the 
funding. But I understand there's a direct link, you know, to 
the college campuses to make sure that the kids that are getting 
the funding are actually completing the schooling. And so, a 
personal interest of mine is to ensure, one, that we're actually 
doing the outreach to the students; that we're actually letting 
them know what they need to do to get into college, and what 
programs are available to them. 

I'm a firm believer not everyone's academically 
bound. They're not all going to go on to four years, so we also 
have to make them aware of the different types of vocational 
programs that are available to them, to help them be 
self-sustaining. 



1 The other part of that is the workforce 

2 development piece. I think it's really critical. 

3 My current organization today, as well as many 

4 others, are going to have a big workforce drain. In the next 

5 five years, we'll probably have 45 percent of our workforce 

6 retiring. We need to replace that. 

7 So currently in my job, I work with Los Rios 

8 Community College and some other ones developing programs to 

9 help replace that workforce. Now, some of that is 

10 degree-driven, but some of that is also more vocational 

11 training. So, what we're doing is developing programs in how do 

12 we train that workforce to replace the one that ' s actually 

13 retiring. 

14 And the other piece is looking at alternative 

15 ways to deliver the same service. When I look at the different 

16 budget cuts that are coming down, that doesn't mean to me that 

17 we can't continue to do what we do today. That means we have to 

18 find different ways to do what we do today. We have to be more 

19 innovative. So, maybe not just looking at a traditional 

20 classroom for instruction, but also looking at ways that we 

21 could make learning more available to students through either 

22 TV, or making it available through the Web, which the students 

23 today are very, very familiar with learning that way. 

24 And the other piece of that as well is making 

25 sure that we always have our pulse on the student, because 

26 everything we do at our level -- we can develop a strategic 

27 plan. We could make all the best of plans, but if it's not 

28 really what the student needs to get through the school, then in 



11 



my mind we're unsuccessful. 

So, part of what I hope to bring to the board is 
having that pulse on the community of the students and what they 
need, and helping to align that with the goals of the board as 
well as the locals. 

I would have to say, one of the things I did talk 
about today is the role of the board. And the role of the board 
is much more advisory than it is policy setting. For me, what 
I'm trying to do is navigate my way through understanding that. 
And a good example of that is the text book. 

You know, we came out with some recommendations 
on the text books. It seems like it's a logical thing to do, to 
write a policy around, but the position we take is advocacy 
instead. And I understand we want to give academic freedom to 
the locals, but at the same time if it makes sense and it 
benefits the students, why wouldn't we make that policy? 

So, part of my role is also trying to understand 
what can we do as board members, and how impactful can we be to 
ultimately help the students . 

MR. McDONALD: As I shared with you earlier, 
Member Padilla, in our meeting, I kind of like what Alice said 
earlier. 

We know that in Southern California, Southern 
California Edison and Southern California Gas Company are going 
to lose 50 percent of their workforce in the next five years. 
So, the career technical education component, the workforce 
education component is very, very important, and we need to take 
a look at that . 



1 The other piece of this is the -- the services: 

2 the firemen, the sheriffs. Those types of programs are growing, 

3 at least in Orange County, because there's a new building and 

4 new classroom, some facilities that were just built on the 

5 Marine Corps Base, thanks to Santiago Canyon College District, 

6 and that ' s happening . 

7 The other piece is, we just received $50 million 

8 from the OSHA Foundation. So, one of the things I kind of want 

9 to take a look at is, make sure we can offer more scholarships 

10 to underserved and under- represented students, veterans, and 

11 students of color, and women. Those are very, very important. 

12 Those are things that I'm looking forward to happening on my 

13 term on the board. 

14 SENATOR PADILLA: I appreciate that, particularly 

15 the recognition that it's sort of not. just the role of the board 

16 members, but for the strength of the board. I think a lot of 

17 people may believe the board members have more authority to 

18 crack the whip and make changes in the community college system 

19 in the state than is actually the case, not that that won't 
2 change over time. That's number one. 

21 Number two, an issue important to me is this 

22 issue of transfer rates from our students in community colleges 

23 to the four-year universities. The rates at which we're 

24 transferring students is way too low based on students' goals 

25 entering our community college system, and certainly based on 

26 the workforce needs of this state over the next several years 
2 7 and beyond. 

28 I talked to you about some legislative as well as 



13 



some budgetary items that we're working on. I look forward to 
working with you on those issues because this new Chancellor 
you're getting, boy, is he squirrelly. 

SENATOR BATTIN: I'll move the confirmation. 

CHAIRMAN PERATA: I have couple questions, but 
first of all, do you have any family here? 

MR. MCDONALD: I have a couple of friends that 
are here. State Librarian Susan Hildreth's in the back, and 
Nicole Rice with one of the groups back there. 

CHAIRMAN PERATA: Welcome. 

MS. PEREZ: Actually my mother and five children 
are here with me in spirit . 

[Laughter . ] 

CHAIRMAN PERATA: Five kids, you've got a school 
district by yourself. 

MS . PEREZ : That ' s right . 

CHAIRMAN PERATA: There's something that came to 
my attention recently, and I don't know if I was surprised or 
alarmed. And that is that the Chancellor's Office estimated 
that 90 percent of the incoming students are not prepared for 
college level work. 

Jack's a good politician, so that number's going 
to drop as soon as he gets there. 

You've been there not too long, but are you aware 
of that? And even though you're in an advisory role, how would 
you plan to cajole the administration to change that, other than 
just changing the number which is what we do here. 

MS. PEREZ: Actually, if you ever attended the 



1 board meetings, I mean, I ask a lot of questions, because I not 

2 only -- one of the things that was brought to our attention was 

3 that each of the campuses have created a plan around how they're 

4 going to do outreach, how they're going to work with the local 

5 K-12 to make sure that we're bringing kids on that are better 

6 prepared, that have the basic skills in place. 

7 But to me, a plan is great, but if you don't 

8 track the implementation of that plan, then how successful are 

9 you really. 

10 So, a lot of the questions that I ask are: How 

11 are we actually going to track the implementation of the plan? 

12 How are we going to partner with other groups that are out there 

13 today that are doing similar type activities so we're not 

14 reinventing the wheel, but we're leveraging the strengths of 

15 everybody that's out there doing similar type work? 

16 So, I think through tracking of this, not just 

17 having a plan -- and also, I think we can leverage the budget 

18 from the standpoint that if we're allocating the budget, part of 

19 that allocation can also be reporting back on some of the 

20 activities that are taking place. So, it's not just the fact 

21 that you put a plan, but now what are some of the reporting back 

22 on that if you want to get a reallocation of budget again next 

23 year? 

24 So, those are some of the things that I've 

25 discussed. 

2 6 CHAIRMAN PERATA : Thank you. 

2 7 MR. MCDONALD: I'm encouraged by the fact that 

28 the several meetings we've had, that there have been different 



15 



organizations that have come forward from different groups to 
talk about the different -- and this is not throughout the 
system; this is very sporadic throughout the system -- looking 
at ways to help students better their skills and gets the basic 
skills, and getting the needs. So, I'm encouraged by that. 

I mean, I can't sit here and tell you that I know 
for a fact that this is happening on each one of the campuses 
because I haven't been around long enough, but I am encouraged 
by different groups on campus understanding these needs, and 
coming forward and making it happen. 

CHAIRMAN PERATA: One of the things that Jack 
Scott has talked about since the time I've known him is trying 
to get some uniformity of course descriptions. So, if you're 
going to Laney it's different than when you go to Weed. 

So, I would just encourage you to give him all 
the help you can on that. 

There are two things over the time that we've 
been to talking to community college trustees. One is, at Taft 
Community College in Bakersfield, they have a program for highly 
functioning autistic children. I don't know if you're aware of 
it, but it's a remarkable program. 

Autism is a problem that's just growing almost 
pandemically at this point. 

We hear the board is supportive of it, but are we 
in the position now of trying to replicate it? Are there things 
that you can do to help encourage that replication? 

MS. PEREZ: I would say for myself, I wasn't 
aware of the indepthness of the program. Being a new board 



member, I don't know about all the different programs we offer. 

I am familiar with autism, though, because I have 
a couple of friends that have autistic children. So, I 
understand the challenges associated with that. 

I think as board members one other thing we can 
do again is ask what about doing pilot programs. We have 
success in one school, but now what about doing a pilot? 

It seems like what I'm seeing as far as the cycle 
is, we usually take something that's successful and then we 
duplicate it ten times. So, what can we do to create a pilot 
program in ten other universities to see how well it is when we 
roll it out? So, that's one of the things as a board member I 
think I can do . 

MR. McDONALD: I would concur with that. We 
have -- some of the community colleges throughout the state are 
noted for different niche areas. Case in point, the Syskiyous 
and Sequoias. They help train rangers, have classes for rangers 
to be park rangers . 

So, we have all these different things, so I 
don't see why we couldn't duplicate it or be involved with it. 
But again, that's the way, the make-up of our system is. 

CHAIRMAN PERATA: Right. 

Well, I commend that to you because when you do 
have something that is a prototype, and it's developed, you 
don't need to reinvent it, just replicate it. 

The last thing is, Ironwood State Prison in a 
place called Blythe. They have a very successful program in AA 
Degrees for prisoners who are still incarcerated. There's been 



17 



a lot of talk, thankfully, in this administration about 
rehabilitation of incarcerees [sic] because we have this 
incredibly high recidivism rate. 

That ' s another one that I would commend to you to 
look at in terms of its capability of being replicated. 
Probably most communities have a prison now certainly within the 
jurisdiction of a community college district. 

But looking at places like Avenal and the High 
Desert, where there are prisons and maybe community colleges 
there, look at what I would consider to be an opportunity. If 
there's money in Mr. Cates ' budget that you could rip off and 
use for your purposes, that would be a really nice thing to show 
partnership and familiarity with other things. And he will not 
get as gray as fast as he is right now. 

MR. McDONALD: I know that when I was in the 
service, I took the correspondence courses. And I know that 
Coastline Community College down in Orange County pretty much 
handles all of the military courses across the -- overseas and 
locally. 

And I did not ask them if they did anything with 
the prisons, but I'm quite sure some of those courses that are 
-- from the community college can go to the prisons and to the 
people that work in the prisons. So, I know there's an 
opportunity there . 

MS. PEREZ: Actually, I think that's our 
responsibility, because I think we have a responsibility to 
rehabilitate these prisoners. And so, some of the groups that I 
serve on from a board perspective, we talk to people about the 



college programs that are available to them, so make use of that 
time . 

But the other thing is preparing them so that 
when they return to the community, that they actually have 
something they can fall back on, because the problem is, if you 
don't give them something, you know, we can give them a fish 
when they leave, but if we don't teach them to fish, they're 
going to end up right back there again, and that's exactly 
what's happening today. That's why they keep -- the prisons 
keep getting bigger and bigger, is because we're not teaching 
people how to fish. 

And so, I'm very supportive of that, and I think 
we have a responsibility for that. 

CHAIRMAN PERATA: One of the things you should 
know is that there are far fewer positions, education positions, 
assigned to the prison than are filled. And to be able to move 
from the outside-in, particularly with the kind of job skills 
that are necessary to climb a pole as an electrical worker. And 
there are people. I know that in Los Angeles, there have been a 
couple of programs out of L.A. County Jail that they've taken 
into the construction industry. It's been very successful. 
Just because you're a felon doesn't mean that you're stupid or 
you couldn't learn a skill. 

And I think we have such a broad base in our 
community college system that it is something that I would 
encourage you to look at . 

I ' d be really surprised if you could visit every 
campus in the state before you're dead. I know it's really nice 



19 



in the Central Valley this time of year to go by. Just get a 
new car, drive up 99, which we're going to fix one of those 
days. You could get a chance to see some really great places. 

Well, I'm delighted that you both are willing to 
do what you're doing, and I wish you well. 

If there's anything any of these other people can 
ever do for you, I have to leave -- actually, we both have to 
leave -- but Gil and Bob will be around, and Alex lost interest, 
but he'll be around, too. 

[Laughter. ] 

CHAIRMAN PERATA: Call the roll, please. 

Oh, anybody want say anything nice? 

MR. POSNER: Mr. Chairman, Members, I'm Howard 
Posner. I'm the Vice President of the SMUD Board of Directors, 
here in support Alice Perez's nomination. 

CHAIRMAN PERATA: It ' s a good sign, a very good 
sign. 

Thank you. 

MS. BORROEL: Mr. Chair and Members of the 
board, my name is Diana Borroel . I'm the CEO of the Sacramento 
Hispanic Chamber of Commerce . 

I am also here in support of Alice Perez. 

CHAIRMAN PERATA: Thank you. 

Anyone else? 

Would there be anybody here to be so indelicate 
as wanting to speak in opposition? I didn't think so. 

Call the roll, please. 

SECRETARY WEBB: Cedillo. 



SENATOR CEDILLO: Aye. 

SECRETARY WEBB: Cedillo Aye. Dutton. 

SENATOR DUTTON: Aye. 

SECRETARY WEBB: Dutton Aye. Battin. 

SENATOR BATTIN: Aye. 

SECRETARY WEBB: Battin Aye. Perata. 

CHAIRMAN PERATA: Aye. 

SECRETARY WEBB: Perata Aye. Padilla. 

SENATOR PADILLA: Aye. 

SECRETARY WEBB: Padilla Aye. Five to zero. 

CHAIRMAN PERATA: Congratulations to both of you. 

MR. McDONALD: Thank you, Mr. Chair. 

CHAIRMAN PERATA: Now Carole Hood, who is Chief 
Deputy Secretary for Adult Programs for the Department of 
Corrections and Rehabilitation. 

Welcome . 

MS . HOOD : Thank you . 

CHAIRMAN PERATA: Would you like to tell us a 
little bit about yourself? 

MS . HOOD : Sure . 

Good afternoon, Senator, Members of the 
Committee. My name is Carole Hood, and I've been nominated by 
the Governor to serve as the Chief Deputy Secretary for Adult 
Programs in the California Department of Corrections and 
Rehabilitation. 

I've served in this position now for eight 
months. I was retired for a year prior to that and came out of 
retirement to do this particular job. 



21 



CHAIRMAN PERATA: Are you making minimum wage 
now? 

MS . HOOD : I'm not making any wage at the moment . 
It seems like I make -- I do make good decisions usually. 

[Laughter. ] 

MS. HOOD: Don't hold that against me, all right? 

In this position, my job is for providing the act 
of rehabilitation for the Agency for adult offenders. And our 
goal is to reduce recidivism and to increase public safety when 
offenders leave our prisons. This is going to be done primarily 
through improving the programing that we ' re providing in 
prisons, but also a more coordinated approach when individuals 
leave our prisons and go into the community. 

Many people have said that actually all reentry 
is really locally based. I would certainly agree with that, 
that the seamless transition from prison to the community is 
extremely important . 

A little bit about me. I've spent -- my 
professional career is about 33 years; 27 years in state 
government; 3 for a private nonprofit, and 3 working for myself, 
which is a lot different when you get up every day and see your 
boss in the mirror than it is today. 

But nevertheless, when I started in state 
service, I started as a graduate student. I was a graduate 
student at UC Davis. I began at the Department of Finance, and 
moved through the administrative ranks and have served primarily 
for most of that 27 years as a chief deputy director of various 
departments, all in Health and Human Services: some Mental 



Health, Social Services, and Developmental Disabilities, Child 
Support, and Alcohol and Drug Programs, as well as time at the 
Health and Human Services Agency. 

My educational background is as a sociologist, 
and I was teaching at UC Davis before I started as a grad 
student, as a teaching assistant there, specialties in at the 
time called Social Deviance and Sociology of the Family. 

Now, why I think I'm qualified for the job, I 
have a lot of experience with many of the core programs that 
we're talking about now bringing into the institutions. But 
also in those professional experiences, very familiar with the 
systems that operate in the community, whether that be the 
public mental health system or the social service system, the 
mental health system, which I think is very, very important. 

I also have experience in running large 
institutions. In these various jobs, I was responsible at 
different times for the State Developmental Centers and the 
State Hospitals. They have a lot of similarities in terms of 
24 -hour care operation and a very large institution. 

My experience that I also think lends to this is 
working to bring about significant reforms in various program 
areas, which I've done, whether that be welfare reform, or 
working in Child Support Services and changing the way that we 
manage that program. 

Lastly, I think, which is important for this job, 
I have a great deal of tenacity and perserverance, and a lot of 
patience. So, I would say that those would qualify me for the 
job. 



23 



And I think at this point, and perhaps most 
importantly, after eight months on the job, I believe more than 
ever in the importance of it, and I still want to do this job, 
and I still believe it can be done. 

So with that, I welcome any questions. 

CHAIRMAN PERATA: Thank you. 

My first question is, do you have family here? 

MS. HOOD: I do, indeed. I have my husband in 
the front row. It's kind of a Rogue's Gallery. My husband of 
31 years, Burl Jones. He has supported me throughout these 
various jobs. 

And my two children: Alison, who's 13 going on 
35, and I manage that quite well; and my youngest daughter, 
Kyley, who is 9, who makes great sacrifices for this job, 
including being convinced not to wear her soccer shorts and a 
David Beckham soccer shirt today. 

[Laughter. ] 

CHAIRMAN PERATA: You would have been welcome in 
your soccer shorts. You should see the way Mr. Battin dresses 
sometimes . 

[Laughter . ] 

CHAIRMAN PERATA: Do I hear a little hint of an 
accent? 

MS. HOOD: Yes, particularly when I get nervous. 
Yes, I'm from England originally. 

CHAIRMAN PERATA: We've heard of it. 
[Laughter. ] 

MS. HOOD: And came to this country when I was a 



teenager, actually to Sacramento. So, I've been here nearly my 
entire life. 

CHAIRMAN PERATA: It's delightful actually. 

There are a couple of things I want to ask you, 
and then I want to talk a little bit more generally about what 
it is that you're doing. 

First of all, I'm very pleased that someone with 
your background is willing to do this job. I know it's very, 
very difficult to keep and maintain people. 

The Proof Project at Solano State Prison, tell us 
a little bit about that. 

MS. HOOD: Yes . Essentially my job is in two 
areas. One is improving what we have, and the other is bringing 
about the recommendations of the Expert Panel and the Governor's 
Rehabilitation Strike Team. 

It was recommended that we test, in essence, the 
recommendations of the Expert Panel at different sites: a 
reception center site, a prison site, a reentry site, and then 
parole. And the prison site is at Solano. 

And primarily the test there will be on doing 
case management, planning and oversight of the delivery of 
services, including assessing individuals going into those 
services, and also providing new programs, new core programs 
that are currently not available in our institutions, again as 
recommended by the Expert Panel, and the staff training that 
goes along with that. It essentially is a test at Solano. 

At this point in time, we've done very well, I 
think, on moving forward on the reception center piece and the 



25 



assessment piece. And at Solano, we're now moving into the 
implementation of case plan, which is the central part of 
bringing up the new rehabilitative model. We will be done with 
all of the documentation for that, and the next step will be 
moving that forward for discussions with labor relative to 
implementation of that. 

CHAIRMAN PERATA: One thing that is always coming 
up is the miserable reading level. Primarily most inmates would 
seem to be functionally illiterate. 

What is it we're doing about that, and what do 
you think is a reasonable expectation for the position that 
you're in and overseeing? 

MS. HOOD: Improving the reading level is 
probably one of the central things that we need to focus on. It 
is very dismal. The statute requires us to raise the reading 
level to ninth grade. Most folks based on our testing are 
around sixth and seventh grade. 

When you look at the need for literacy, out of 
the 170,000 inmates, about 125,000 would qualify as needing 
assistance . 

There have been targets set in statute, old 
statutes in the '90s, that we would first have 25 percent of the 
need by 1991, and then 60 percent of the need by 1996. That 
hasn't happened, and it hasn't happened for a variety of 
reasons, not the least of which is the overcrowding of the 
institutions . 

What -- what we want to do now, and what we're 
putting a plan together to do, is to focus on a statewide basis 



on literacy, and establish a literacy program, which folks have 
tried to do in the past and with some success in individual 
institutions, but it's not been systemic system-wide, and it's 
not been fully watched, meaning as the prior nominee was 
stating, what you watch and measure is really what gets the 
attention. So, that is what we plan to do, but using a variety 
of different things: distance learning, independent study, the 
use of inmates in peer arrangements, community groups to assist 
us in implementing that plan. 

You don't have to have a classroom in every case; 
you can do this. I mean, I would think that this is low hanging 
fruit for us, and I do want to put an emphasis on it. 

CHAIRMAN PERATA: Okay, thank you. 

Any other questions? 

SENATOR BATTIN: Yes. 

Well, thank you for coming today. When we spoke 
yesterday, I told you I ' d be asking you some questions. 

MS. HOOD: Yes. 

SENATOR BATTIN: Let's get to it. 

MS . HOOD : Okay . 

SENATOR BATTIN: I have just about five or six, I 
suppose. 

What's the current recidivism rate of those that 
are completing the programing right now? 

MS. HOOD: It's really hard to distinguish 
because the programing that we have, is fairly limited. We have 
academic, vocational, and substance abuse programs. And still 
with that, it has been said that our recidivism rate is 70 



27 



percent . 

SENATOR BATTIN: Where would you like to see us 
at? What's your goal, realistically? 

MS. HOOD: Realistic goal, I mean, I look at this 
as every one percent -- to be honest, every one percent you can 
stop going in is a significant benefit. 

I will say that our research folks are working 
on, you know, how to define recidivism rates, but it does vary 
in different states, and it varies here. 

But for every one percent that we can save , and 
if the annual cost in a prison setting is $46,000, the average 
number of times people go through the system is 2 . 5 . It mounts 
up pretty quickly. 

So, I would say it's incremental, and I wouldn't 
want to speak for the entire Agency, but for every one percent, 
I'd be looking at significant savings. 

SENATOR BATTIN: Riverside Community College has 
developed a program to assist parolees with educational 
programs. I think actually former Senator Presley is involved 
in that, a former director of CDC. They're there to help them 
and create educational programs to help reduce recidivism. 

It's my understanding that this program was 
presented to CDCR last year. Can you tell me the status of it, 
and your department's cooperation in the effort? 

MS. HOOD: Yes, and you did ask me about this one 
in particular. And, you know, at this point, I think there has 
been dialogue with the department. I want to say that I will 
certainly now make sure that we sit down and have more dialogue 



about what we can do . 

I did take a look at the proposal between last 
night and this morning, and it is a proposal. It is entirely- 
consistent with what we're thinking in terms of the Prison to 
Employment Program, which has the components of both an 
in-prison work with inmates, and then a transition to the 
outside and direct employment opportunities. So, it's entirely 
consistent . 

The issue will be how we - - how we fund that, and 
how we do that in a way that it is an open process to do that. 

But I would offer to you and commit to you to sit 
down and have a serious dialogue with these individuals about 
their particular program. 

SENATOR BATTIN: The RCC programs serves between 
600 and 1,000 parolees a year. How many other programs are like 
that? 

MS. HOOD: We do have a lot of programs like 
that, not of the same ilk. All of these programs are quite 
different. But we do have multi-service centers, for example, 
both for women and for men, that provide both employment, 
educational, and other support services, and then a variety of 
other community-based services. Most of those are funded out of 
the Parole Division. And so, many of them serve that many and 
more individuals. 

I guess what I'm saying there is that this really 
does fit in with the types of programs that we have funded in 
the past, like day reporting centers and the multi- service 
centers . 



29 



SENATOR BATTIN: When you start that dialogue 
with them, would you update me? 

MS. HOOD: I absolutely will, yes. 

SENATOR BATTIN: I would appreciate knowing. 

MS. HOOD: Yes. 

SENATOR BATTIN: And then lastly, about half of 
the AB 900 funds are to go to inmate parolee rehabilitation. 
Some believe that these funds are to go to construction of 
facilities only. 

What's your belief on that? 

MS. HOOD: My read of the statute is that there 
was a $350 million appropriation in the bill, 50 million of that 
was for rehabilitation. The rest was construction. 

AB 900 also authorizes lease revenue bond 
financing, $7.5 billion, and it's all for construction. 

So, there really was not in that bill specific 
money, other than the 50 million, for rehabilitative 
programing . 

SENATOR BATTIN: Okay, thank you. 

CHAIRMAN PERATA: Bob. 

SENATOR DUTTON: Just a couple of minor ones. 
I'm interested in the area of rehabilitation, 
making sure that inmates who are about to be released get some 
training and some opportunity to be successful. 

The other component of that would be trying to 
ensure some kind of job placement. 

MS. HOOD: Yes. 

SENATOR DUTTON: Is there anything that you can 



think of, or is there something we're currently doing that I'm 
not aware of, or things that we should think about doing to 
actually help make sure? Obviously, even if we train them, if 
they don't very a job to go to, then it's not a very good 
formula for success. 

MS . HOOD : Right . 

We do have some programs now that actually are 
with -- affiliated with apprenticeship programs, where folks do 
go directly into jobs when they're certified. 

But part --a key component of AB 90 is the 
Prison to Employment piece. So, we are modeling the California 
New Start Program after a program that has operated in Texas 
called Project Rio, which is exactly what the Senator was 
mentioning the Riverside folks are interested in, which is a 
program that matches up in prison. First of all, it provides 
vocational training for those jobs where there is a projection 
that there's going to be a job available in the future, which is 
pretty key, not training people for things that aren't going to 
happen in their communities. So, we are now hooking up to labor 
market data and making sure we're only starting up and changing 
other programs, vocational programs, that don't work. 

We're entering into an inter-agency agreement 
with the California Workforce Investment Board. We've already 
signed an MOU between the two Agency Secretaries of Labor and 
Workforce Development and Corrections and Rehabilitation. That 
happened in May. The inter-agency agreement will permit us to 
partner with those 4 9 local Workforce Investment Boards and the 
200 One-stop Centers. They will be the connection then directly 



31 



to employment . 

So, I think we've got a good plan. We've got 
excellent cooperation from the other agency and the Workforce 
Investment Boards. So, I'm expecting that that will be one of 
our better activities. 

SENATOR DUTTON: Great, thank you. 

CHAIRMAN PERATA: Do you have any direct contact 
with labor unions? 

MS. HOOD: I do with representatives of SEIU and 
AFSME, because they are the ones that represent the folks that 
I'm mostly working with: teachers and psychologists. 

CHAIRMAN PERATA: What about the trade unions, 
the people who are really organized outside? 

MS. HOOD: Absolutely. Our vocational 
instructors at each of the institutions do have those 
relationships, and they have local trade association committees 
that they participate in. It's actually a requirement of the 
job, that they have those connections before they work for us. 

CHAIRMAN PERATA: Good. 

Anyone like to speak in support? 

MR. SELIX: Rusty Selix, Executive Director of 
the Mental Health Association of California and California 
Council of Community Mental Health Agencies, in support. 

CHAIRMAN PERATA: Thank you. 

MS. RYAN: Pat Ryan, Executive Director of the 
California Mental Health Directors Association, in support. 

I want to say more than just that I'm in 
support. I want to say that I've been the Executive Director at 



CMHDA for seven years and worked for the California Hospital 
Association doing mental health advocacy work prior to that. 

I have known Carole for about 15 years and have 
worked with her in her different capacities and jobs and in 
mine. And I don't think I know anybody in state service who is 
brighter, more organized, more committed than Carole is. 

And I just want to give you a short story. Prior 
to her coming over to CDCR, she was a consultant and was brought 
in by the Department of Mental Health, which she, of course, 
used to be Chief Deputy Director at. They brought her in to 
help them out with Prop. 63 implementation. Some of you may 
have heard about some of the Department ' s struggles in 
implementing Prop. 63. 

But Carole came in, and in a very short period of 
time, analyzed the situation, looked at sort of the money flow, 
looked at how it was working, and came up with some very 
streamlined, organized, common sense approaches to how we were 
going to get the money to our communities and to the counties, 
and I think made a huge difference in the time that she was 
working as a consultant to the Department of Mental Health. 

When we heard that she was leaving that job, we 
were --we were quite disappointed, but when we heard that she 
was leaving to go and take this position at the Department of 
Corrections and Rehabilitation, we thought, well, if she's going 
to leave, it's a great place for her to go at this point in time 
because if there is any area that we need -- that the state 
needs somebody like Carole to make a difference in, it's the 
Department of Corrections and Rehabilitation. 



33 



If we're ever going to make a difference in this 
state, in our communities, and particularly at preparing --at 
keeping people out of the prisons and preparing them to reenter 
the communities, we're going to need the Department to be 
working much more closely and collaboratively with our 
communities and our counties in how that's going to happen, and 
particularly at addressing not only their educational needs, but 
their mental health and substance abuse needs. 

So, I can't think of a better person to be in 
that position. 

CHAIRMAN PERATA: Thank you. 

MR. WARREN: Good afternoon. My name is David 
Warren. I'm appearing on behalf of Taxpayers for Improving 
Public Safety. 

I'm here in support of the nomination. 

I have to say that after the initial difficulty 
of her understanding my accent and the way I spoke very rapidly, 
we have worked very well together. 

[Laughter. ] 

MR. WARREN: I have to say notwithstanding the 
fact I may not be allowed back into a Department of Corrections 
office again, that her position's probably more important than 
the Director's because, in all honesty, if we don't reduce 
recidivism, the prison system will simply grow geometrically, 
and we simply no longer afford that to happen. 

Senator Battin, you asked a question about people 
who program and succeed. I can't speak for California, but in 
the State of New York, individuals who were very active in 



religious programming in the New York State prisons had a 
recidivism rate of slightly less than 3 9 percent. That 
certainly is an indication of the success of that particular 
version of programming, and it can be translated here into 
California. 

One of the things that strikes me most when I'm 
leading services is the fact that as I pass the prayer books and 
Bible -- in our case the Chumish -- around, most of the inmates 
cannot read the English, let alone even understand what the 
Hebrew sections are. And when I have to deliver a sermon, I 
have to do it on a third or fourth grade level, as if I were in 
a Sunday school class instead of an adult education class 
because the members of our congregations have so low a level of 
education. 

Senator Perata, you asked about community college 
activities . 

Unfortunately, one of the things that you didn't 
bring up was the very successful program at the California 
Institution for Women, where I do lead a service. And I'm not 
trying to prod Wendy, who's sitting in the back, but I can say 
this from personal knowledge. Not one of the young women or 
older women who've participated in that program have been back 
to religious service [sic] after they've been paroled. And that 
certainly speaks highly on the rate of success. I just wish 
there were more opportunities. 

I think it's very important that we fully support 
the activities, and I would ask that the Members read the C-ROB 
reports, because most of what she has done is reported there. 



35 



My only concern is that the Department is 
programming and preparing for a program that can be very 
successful but will be very expensive. And in times of 
financial difficulty, it's going to be very difficult to 
implement. And I'm hoping for the best, but fearing that we 
will not succeed. 

Thank you very much. 

CHAIRMAN PERATA: Thank you. 

MR. TATUM: Good afternoon. I'm Richard Tatum, 
State President of the California Correctional Supervisors 
Organization. Our organization represents the supervisors and 
managers in the California Department of Corrections and 
Rehabilitation . 

I think that the Department of Corrections, the 
state, state employees right now, there's a lot of crises going 
on in the state. 

We feel in dealing with Ms. Hood that she's 
definitely something that Matt Cate needs right now. So with 
that, we recommend that you appoint her. 

Thank you . 

CHAIRMAN PERATA: Thank you. 

MR. BROWN: Mr. Chairman and Members of the 
Committee, my name is Chris Brown. I'm representing the 
Association of Black Correctional Workers. 

I would like to offer the Association's full and 
complete support of Carole Hood's appointment to the position of 
Chief Deputy Secretary for Adult Programs. 

I have had an opportunity to work closely with 



her, and I believe that you have the right person for the job. 

CHAIRMAN PERATA: Thank you. 

MR. BROWN: Thank you. 

CHAIRMAN PERATA: Anyone here in opposition? 

Well, I just want to conclude. This actually is 
not directed at you, but in picking up the paper this morning, I 
see that we have three people who are leaving the Department of 
Corrections, three administrators. One of them is David 
Runnels, who I think we confirmed in July, and now he's leaving. 
And the person that you're replacing we confirmed in May of 
2007, and she was gone in November of that same year. 

There are others who, from the top going down, 
that we confirm, and we hear lots of good things, and then the 
next bus out of town, they're on it. 

Some of these people are not leaving because 
they're disgruntled. They found out that Matt Cate was going to 
be in charge, and they couldn't stand the thought of it. 

[Laughter. ] 

CHAIRMAN PERATA: They obviously -- I'm just 
warming you up, Matt -- clearly, I think it's a statement about 
the condition of the institution. And going to work for the 
administrator, Kelso, maybe the pay's better, but I'm sure it 
looks like a more stable environment than the one they're in 
right now. 

And so, you're in a very key position, but the 
thing that's most disturbing is that we just can't maintain. We 
can ■ t keep up . I wonder about that . 

You know, from everything I've read, everything 



37 



you've said, people who have spoken on your behalf, I think 
we're fortunate that someone with your background is willing to 
do this work, but I am very fearful of something else that's 
going on culturally within the institution that takes people 
like you and burns them out, burns them up, whatever. 

I'm going to meet with Mr. Cate next week, and 
we're going to have discussion about this whole thing. My 
initial thought was to wait until I talked to him before I 
confirmed you, or we let you out of here. 

But you go home, and you'd have to explain to 
your children what happened. I just don't want that. It'd be 
too hard. 

MS. HOOD: I also told them to cry if something 
bad happens . 

[Laughter . ] 

MS. HOOD: I wanted to give you that warning. 

CHAIRMAN PERATA: The younger one looks like 
she's all ready to tee off of me. 

[Laughter. ] 

CHAIRMAN PERATA: I can only wish you well. 

MS . HOOD : Thank you . 

CHAIRMAN PERATA: You certainly have well defined 
the height of the mountain that you've got to climb. 

MS. HOOD: Yes. 

CHAIRMAN PERATA: The rabbi left. He's not on 
the clock. He's here on his own time. It's not like the rest 
of you. Some of you are being paid for it. Some of you 6.57; 
some not at all. 



MS . HOOD : Yes . 

CHAIRMAN PERATA: And you. 

MS. HOOD: Yes. 

CHAIRMAN PERATA: You're right. That did give me 
pause about your sanity. 

MS. HOOD: Yes. 

Can I just add on that? 

CHAIRMAN PERATA: Sure. 

MS. HOOD: I came to do this job because I 
thought it was right thing to do. I really thought about it, 
especially when I got on the freeway that first day in a suit 
and wondered: What have I done? 

CHAIRMAN PERATA: What the hell am I doing here? 

MS. HOOD: And I'm even more committed after 
being there on how this -- this can be done. There is no other 
career for me. I'm not planning on any other career. When I 
get done with this, I'm going home. 

So, you know, I really want to make this happen. 
So, I'm not going to the Receiver; I'm not going anywhere except 
to do this. 

And if it can't be done, then I will be letting 
the Secretary know I don't think it can be done, and go to Plan 
B or something. I think we have that agreement, and he's 
certainly been exceedingly supportive, as has the rest of the 
administration, in us getting the job done, and my boss, 
Undersecretary Cathy Jack. 

So, that's my commitment to this. 

CHAIRMAN PERATA: Thank you. 



39 



roll, please. 



With that, we have a motion to approve. Call the 

SECRETARY WEBB: Cedillo. 

SENATOR CEDILLO: Aye. 

SECRETARY WEBB: Cedillo Aye. Dutton. 

SENATOR DUTTON: Aye. 

SECRETARY WEBB: Dutton Aye. Padilla. 

SENATOR PADILLA: Aye. 

SECRETARY WEBB: Padilla Aye. Battin. 

SENATOR BATTIN: Aye. 

SECRETARY WEBB: Battin Aye 

CHAIRMAN PERATA: Aye. 

SECRETARY WEBB: Perata Aye 

CHAIRMAN PERATA: Congratulations. 

MS . HOOD : Thank you . 

[Thereupon this portion of the 
Senate Rules Committee hearing 
was terminated at approximately 
2 :40 P.M. ] 

- -00O00- - 



Perata . 



Five to zero 



CERTIFICATE OF SHORTHAND REPORTER 



I, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California, do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 

f^ IN WITNESS WHEREOF, I have hereunto set my hand this 

, 2008. 



r-] fi^ IN WITNESS WHEREO; 

/ da y of y^G^^y^^ 



EVELYN J. MIZAK 
Shorthand Reporter 



41 



APPENDIX 



Background for Senate Confirmation Hearing Policy Questions 
Goals and Responsibilities 

1. Please provide a brief statement outlining the goals you hope to accomplish while 
serving as a member of the Board of Governors. How will you measure your success? 

As a member of the Board of Governor's, I would like to list as accomplishments, during 
my tenure, enhanced opportunities, increased visibility and improved awareness. 
When I am in the public or private sector, speaking about the special uniqueness and 
positives of the community colleges, I will focus on key areas such as veterans, career 
technical education, workforce education and development, selection of the new 
chancellor, foundation development and the new Osher Foundation scholarships. 
As a community college graduate, Los Angeles Harbor College, hopefully my passion, 
energy and attitude will help me reach my goals. 

As an example, we already made a significant stride by selecting a new chancellor with 
community college experience and knowledge. He also brings to the system a special 
experience from our legislative body. His ability to advocate and present the educational 
values of the community college will be of great importance. 

Another example, also have established this year the largest gift to a Community College 
system to the tune of 50 million. It will be up to me to help increase the scholarship 
opportunities for all students and to help increase the development offices throughout the 
State with outreach support. 

My ability to work with the other board members, staff, community college personnel, 
and the legislature will be the greatest measurement of my success, plus building on our 
historic strengths in higher education of California Higher Education and working to 
preserve the funding that allows the students of California to improve their lives, their 
career potential and completing their educational goals. 

2. As a board member, what training have you received for your position? What 
conflict of interest training have you received? From whom do you seek advice on 
potential conflicts? 

Here is a partial list of my training: Senate Rules Committee 

Community College Graduate, Los Angeles Harbor College 

CSU Fullerton Graduate JUL 7 2008 

Student Body President@ LA Harbor College 

Alumni President at CSU Fullerton Appointments 

CSU Statewide Alumni President 

City of Anaheim Housing and Redevelopment Commission 

Member of California Association of College Stores 

California Cultural and Historical Endowment Board (Governor's Appointment) 

A Deep Commitment to Keeping Higher Education Strong— 



43 



I seek Conflict Training advice from; 

State and Local Ethics Training every 2 years 
State and Local Conflict of Interest Training every 2 years 
City of Anaheim Commissioner's Conflict of interest training 
Bagley-Keene Act 
Brown Act- 
Anaheim City Attorney 
Orange County Attorney General* s Office 
State of California Attorney General's Office 

Student Fees and Financial Aid 

3. Should there be a long-term community college student fee policy? If so, what 
should its key features be? 

The BOG adopted a Statement of Principles and Policies for Community College Fees 
and financial Aid in 1987. This policy has been revisited and reaffirmed numerous times. 
It states: 

• Community College fees should be low, reflecting an overall policy that the 
state bears the primary responsibility for the cost of community college education. 

• Community College fees should be predictable, changed in modest fashion in 
relation to the cost of education, and their burden should e equitably distributed among 

students. 

• Financial aid should be sufficient to offset fees that may pose a barrier to the 
access of low-income students. 

• Fee and financial aid policies should be consistent with fiscal and academic 
policies in supporting the dual objectives of access and excellence. 

As you are aware, the Community Colleges serve some of the most needy students in 
California. These students are extremely price sensitive to the cost of education. 
Therefore, I believe we need to look at every angle to help students minimize the cost of 
attending college. I strongly support the Osher Foundation and also finding a way to curb 
the cost of textbooks. 



44 



4. Many community college students, especially those who receive a BOG fee 
waiver, frequently do not complete the free application for student aid form, 
making them ineligible to receive state and federal financial aid. What 
percentage of students who receive a fee waiver complete the application for 
federal financial aid? What should the role of the board be in encouraging 
more students to apply for federal grants, loans or work-study? 

In recent years, a growing number of students who received a BOG fee waiver 
also filed a Free Application for Federal Financial Aid (FASFA). The 
percentage of students who filed a BOG waiver is now up to 80%. 

In recent years the Community Colleges have received supplemental funding for 
financial aid delivery. This has been instrumental in helping students understand 
the importance of FASFA. We are looking at ways to maintain this funding to 
help students apply for FASFA, which helps in the process of Pell Grant 
opportunities. 

Preparing for the Future 

5. With over two years into the strategic plan, what have been the major 
accomplishments resulting from its implementation ? 

Most significantly, as a person that believes in access to information, the 
establishment and maintaining of a strategic plan website is a major 
accomplishment. One can review and stay informed with the current changes. 
The February Update outlined several significant results with regard to basic 
skills, college awareness, and workforce education and development. The new 
program of "I Can Afford College" and the marketing slogan of "Who Are You 
Going to Be" are steps in the right direction for enhanced opportunities, increased 
visibility and improved awareness. 

6. Sometimes system wide state policy may conflict with the goals established by 
local community colleges. What role should the board play in balancing long-term 
strategic system wide goals with locally driven priorities? 



The Board plays an important role in identifying statewide policies priorities while 
being mindful of local districts priorities. Districts have the latitude to address local 
needs within the context of the state wide Board of Governors policies. I don't believe 
there needs to be a conflict between state and local priorities. 

7. How does the board monitor and determine whether the strategic plan is serving 
its purpose of providing direction and coherence to the system and to college districts? 

By the nature and setup of our board we should know about monitoring. 



45 



Direction also comes from staff. Regular reports and updates at all Board meetings do 
keep us informed and on course. 

Developing Basic Skills of Community College Students 

8. Wh at steps is the board taking to ensure that more community college students 
are completing basic skills classes? How does the board determine that colleges 
are taking sufficient steps to track students' progress? Please provide us with 
any data the board has on completion of basic skills classes. 

The Accountability Reporting for the Community Colleges (ARCC) report was 
implemented to monitor key outcomes for the community colleges which includes the 
awareness of basic skills progress. 

9. What strategic direction is the board providing the Chancellor's Office in 
dispersing funds specifically set aside for basic skills education? How does the 
board ensure that districts are using these funds to target the least prepared 
students? 

Before receiving any basic skills funds the board requires them to do a self assessment of 
their basic skills practices and an action plan on how they are going to use their basic 
skills funds. 

Student Success 

10. What is the board doing to encourage colleges to work with K-12 schools to align 
educational standards, assessments, and course work that will better prepare students 
for successfully completing a community college education ? 

The board recognizes how important it is to work closely with the K-12 schools. The 
Board has been very eager to support new programs such as The School to College 
Bridge Program. This program establishes a strong partnership between the community 
colleges and their neighboring high schools. The Community Colleges work closely with 
the schools and to help students take the right courses and prepare for college. 

Before they graduate from high school each student actually apply for college. 

The Board is also supporting legislation, SB946 (Scott) that encourages 1 l l graders to 
take the augmented California standards test to provide them an early indication to take 
college level course work. Students are then encouraged to utilize their 12 l grade year to 
brush up on basic skills in preparation for college. 



46 



11. Is the board encouraging colleges to begin using a uniform academic standard for 
assessing college readiness? Do you believe there is a role for the board in addressing 
assessment and placement policies? If so, what should it be? 

All colleges currently have a uniform standard to determine transfer level courses for 
determining whether a student is ready for transfer. These are the courses required if 
he/she wants to transfer to a UC or CSU. 

However, there are some variations in the standards that colleges establish for students 
who are below the transfer level. These standards are based on a local college approach 
on how it develops curriculum. 

12. What can the board do to assist colleges in improving student services that 
would boost transfer rates? How can matriculation programs and counseling 
services better target student populations with the poorest outcomes? 

The Board can look at current student service programs that enhance, prepare and 
encourage transfer. Project Success and the UMOJA Program are two such programs 
that come to mind that are for students who don't come from a college background, 
students who didn't have a great experience in high schools, and for students who hadn't 
connected to the tangible benefits of higher education to career opportunity and life 
enrichment. 

Another positive opportunity, with Board support, is SB 1585 (Padilla), a bill that 
establishes a five-year pilot program that identifies up to 10 participating colleges to 
increase the number of students who move from basic skills to transfer-level coursework 
and ultimately transfer to a four-year institution. 



Career Technical Education 

13. What is the Chancellor's Of/ice doing to address the need for better 
coordination between K-12 and community college vocational programs? How can 
local community college districts improve the alignment of curriculum with the 
secondary level career technical education programs? How can the board help 
accomplish this? 

The Chancellor's office is the lead agency with the California Department of Education 
with SB 70 funds for Career Technical Education. These funds are dispersed on a 
competitive grant basis to Community Colleges working with K-12 schools and business 
representatives. Specifically, the funds are being used to retool existing occupational 
programs to become cutting edge programs for jobs available now and the future. 

I strongly support community colleges working closely with industry to insure that 
students are prepared to meet current workforce needs and the needs of the changing 
economy. 



47 



14. How is the board kept informed of the effect of supplemental funding on the 
enrollment and retention of students in community college nursing programs? 

As I stated earlier, the Board gets reports and information from staff and concerned 
constituencies consistently. Information about nursing and other program funds are 
provided often. 

15. Is the Chancellor's Office providing any direction to local community college 
districts regarding the sustainability of these programs when supplemental funding 
decreases or is eliminated? 

The community colleges are deeply concerned with maintaining the sustainability of its 
programs. We are currently engaged in discussions about how to adapt to changing 
enrollment demands. 

16. Should the board play a role in fostering green technology CTE programs 
locally? 

Yes. The State of California is a leading proponent in the green arena. As of this date 
there are 3 buildings in the State of California that are Platinum Lead rated. They are the 
EPA Building in Sacramento, Ohlone Community College in Fremont, CA. and the 
Environmental Nature Center in Newport Beach, CA. 

Our Board has also been in support of SB 1672 (Steinberg) that proposes to train and 
educate a new skilled workforce to work in the new green technology sectors in the state. 

I believe the Board and the Community Colleges are at the center of training students 
with the skills to be key players in the emerging green and clean technology fields and 
workforce. 



48 



Alice Perez - Response to Questions 

1) Provide a brief statement outlining the goals you hope to accomplish while serving as 
a member of the Board of Governors. How will you measure your success? 1 will work 
with the board members. Chancellors office and local colleges to ensure that all students 
have access to community colleges programs that either prepares them for four year 
university, certificate programs or vocational Training. I would also like to see progress 
towards providing students with more consistent experiences no matter what college they 
attend to ensure they are given the support and tools to be successful in their path of 
education such as counseling, funding resources, textbook programs, medical, and 
wireless Intranet service. I would also like to see more classes available to students by 
using non traditional methods such as TV, Web and on-line hybrid classes. Most of the 
success can be measured by the student's experience of either engaging them in campus 
blogs, surveys or focus groups. Additionally several of the programs we currently have 
underway and the adaptation by the various campuses will also be an indicator such as 
textbook best practices and student Basic Skills Education. 

2) As a board member, what training have you received for your position? What conflict 
of interest training have you received? From whom do you seek advice on potential 
conflicts? 1 have received an introduction to the Board, of Governors and Chancellors 
office that was organized by the Executive Vice Chancellor that outlined the role of the 
board of governors and the various departments within the system office including their 
key goals and objectives as well as their current challenges. 1 also met with the President 
of the Academic Senate to understand their role and was provided with numerous 
briefing statements on several topics they have addresses including Textbook Issues, 
Noncredit in the colleges, etc... The chancellor's office has also provided information on 
conferences that address current issues and best practices thai T can attend as well as I 
receive weekly updates on current events that impact the Community Colleges. The 
board meetings also provide information and updates on key initiatives that the 
community colleges are addressing. For potential Conflicts of interest 1 would seek 
advice from the Chancellor or the President of the Board of Governors. 

3) Should there be a long-term community college student fee policy? If so, what should 
its hey features be? Student. Fees are currently addressed within the Statement of 
Principles and Policies for Community College Fees that the Board of Governors adopted 
in 1 987. The policy states that fees should be low and that the state should bear the 
primary responsibility for the cost of CC education; the lees should be predictable - with 
modest changes in relation to the cost of education; Financial Aid should offset fees that 
may pose a barrier to access and that the fees and financial aid policies should be 
consistent with fiscal and academic policies. In 2003 the board also specified that fee 
revenue collected should be retained by the system and not used to reduce general fluid 
support. 

4) Many community college students, especially those who receive a Board of Governor 's 
fee waiver, frequently do not complete the free application for student aid form, making 

them ineligible to receive state and federal financial aid. What percentages of students 

Senate Rules Committee 

JUL 8 2008 



49 



who receive a fee waiver complete the application for federal aid? What should the role 
of the board be in encouraging mora students to apply for federal grants, loans, or work- 
study aid'/ Roughly 80% of students who receive the Board of Governors waiver also 
complete an application for FASFA. The board supports funding for administration and 
outreach efforts as well as funding the "I Can Afford College" statewide media 
campaign- I would suggest as part of the process of the student receiving the BOG fee 
waiver that the student signs an acknowledgement that they were informed how to 
complete a FASFA and also options for loans and potential work study programs they 
could access. 

5) With over two years into the strategic plan, what have been the major 
accomplishments ? 

Based on the October 2007 update to the strategic plan there has been a lot of progress on 
the first tier of goals identified. The most significant ones to day would be: 

1) May 6 lh Private gift from Bernard Osher foundation of S70M 

Whieh supports seeking non traditional sources such as private gifts and grants? 

2) Basic skills education - All 109 campuses have submitted action and expenditure 
plans for how they will utilize their basic skills funding and how they will incorporate the 
plans using the identified best practices. 

3) Textbook Strategy that would remove the barrier of high cost textbooks that all 
campuses are being encouraged to adapt. 

4) CTE retooling programs to reflect industry needs. Such as the Solar Repair program 
and Workforce development for utility companies focusing on green and clean jobs. 

6) Sometimes system wide state policy may conflict with the goals established by local 
community colleges. What role should the board play in balancing long-term strategic 
system, wide goals with the locally driven priorities? This is a great question that I often 
ask myself. A lot of effort was put into establishing a strategic plan mat seeks to improve 
student access and success. It was a collaborative effort with the Colleges education 
leaders and external partners. It is met to build upon work that has- been done by 
individual colleges and districts and provides the framework for all constituencies to 
work together. The plan is only as successful as the implementation. State polices should 
support this goal as well as local goals. I think it is important that all goals focus on 
improving student access and success. A good example is the Textbook 
recommendations. The board is advocating for local colleges to adapt best practices that 
provide student with access to books as well as ways to reduce costs for books. It*s not 
clear to me why we wouldn't adapt a policy regarding implementing these best practices 
since they do improve access and success instead of advocating that the local colleges 
adapt the best practices. Sometimes locally driven priorities to provide faculty with 
freedom to choose publishers or select textbooks that many not benefit the student's 
learning conflict with providing smdents access and success. 

I think the board should play a role in balancing strategic goals with the goals of the local 
colleges. Otherwise the goals of the local colleges may drive the successful or 
unsuccessful implementation of the strategic goals. 



50 



7) How does the board monitor and determine whether the strategic plan is serving its 
purpose of providing direction and coherence to the system and to college districts? The 
board receives regular updates on the various components of the strategic plan. Action 
plans developed by the Implementation Over site Committee (IOC) are presented to the 
BOG's to review and adopt. Updates are also provided regarding which colleges have 
adapted the action plans recommended by the IOC. 

8) What steps is ike board taking to ensure that more community college students are 
completing basic skills classes? How does the board determine that colleges are taking 
sufficient steps to track students 'progress? Please provide us with any data the board has 
on completion of basic skills classes. The board encourages all colleges to adapt 
programs that focus on basic skills classevS for students. The board has invited colleges 
with programs that are focused on Basic Skills Improvement to attend the board meetings 
and provide best practices presentations. These best practices are shares with the 
Community College network. At the January BOG meeting a presentation was given on 
the UMOJA Community for Student Success which is focused on creating model 
programs for basic skills. Additionally the board receives updates on students completing 
Basic Skills Courses from the Accountability Report for Community Colleges. (ARCC) 
One of the performance indicators of the (ARCC) is "Basic Skills Improvement Rate". 
This report tracks the completion rate of students taking basic skills classes. The most 
recent information indicates that students completing course work at least one level above 
their prior credit basic skills enrollment coursework has risen slightly in the most recent 
cohort (2004-2005 to 2006-2007). Also in order to receive funding for basic skills 
classes each college must provide an annual action plan that outlines how they will spend 
the dollars along with specific actions to support basic skills classes. 

9) What strategic direction is the board providing the Chancellor's office in dispersing 
funds specifically set aside for basic skills education? How does the. board ensure the 
districts are using these funds to target the least prepared students? The strategic 
direction is to ensure that any funding is either used to develop / pay faculty to teach 
basic skills courses to students in need. For the 2007-2008 budget year $33 . 1 million was 
provided for improving ba s sic skills education. $1 .6m is allocated for faculty professional 
development to teach basic skills and the remaining $3 1.5 million is allocated to colleges 
for ESL/Basic Skills on a FTE basic. Additionally each district that receives funding 
must conduct a self assessment of their current basic skills practices in relation 10 the 26 
proven effective practices identified in the research conducted. This will be monitored 
annually to see if colleges are making progress through the ARCC. In the January board 
meeting we were provided an update on the Student Readiness program that included 20 
regional workshops being conducted, a self assessment tool being developed and the 
redirection of over $90 Million to ESL and Basic Skills programs. 



51 



1 0) What is the board doing to encourage colleges to work with K-12 schools to align 
educational standards, assessments, and course work that will better prepare students for 
successfully completing a community education? 

The board has supported the School to College Bridge Program that develops strong 
connections between community colleges, middle schools 

And high schools that encourages through academic preparation for all K-12 students 
while also providing students and their families with direct assistance to enroll in 
community colleges. The board is also supporting SB946 a measure that establishes the 
Community College Early Assessment Pilot program that provides 1 1 th grade students 
with information and guidance to ensure readiness for community college coursework. 
This effort, requires colleges to collaborate closely with K-122 schools to ensure the 
student ahs a successful transition from high school to community college. 

11 ) is the board encouraging colleges lo begin using a uniform academic standard for 
assessing college, readiness? Do you believe there is a role for the board in addressing 
assessment and placement policies? If so. what should U be? 

i do believe the board encourages college to use a uniform academic standard for 
assessing college readiness. However it is still up to each college to agree to use a 
uniform academic standard. The board established an Assessment and Placement Task 
Force to examine the current practices and determine the actual number of assessment 
and placement tests currently used. The findings reflect that the colleges use a total of 92 
tests, with the majority of colleges using one of three major commercial tests in the 
subject areas of English. Mathematics and ESL. 1 do believe there is a role for the Board 
in setting a policy that reduces the number of test being used as well as ensuring there arc 
consistent policies regarding placement to ensure students have an experience that is 
consistent amongst all colleges. 

1 2) What can the board do lo assist colleges in improving student services that would 
boost transfer rates? How can matriculation programs and counseling services better 
target student populations with the poorest outcomes? 

The board has advocated to increase student success services including the matriculation 
program that provides students with a college orientation, assessment, placement and 
academic advising. These programs have been subject to budget cuts in recent years and 
are targeted for an additional 10% cut in the 2008-2009 Governor's budget proposal. One 
way to deal with this budget reduction is to reallocate funding from traditional class 
instruction to counseling services for the matriculation program. In order to do this 
successfully there needs to be more course offerings in non-traditional methods such as 
Web, Television and Hybrid that would reduce overhead costs associated with classroom 
instruction. 

A key strategy is to target these services to students with the poorest outcomes. The 
board is supporting SB! 585 a pilot program that identifies 1 participating colleges to 
increase the number of students who move from basic skills to transfer level coursework 
and later transfer to a four year institution. The board can continue its role to advocate to 
colleges to adapt student services that boost transfer rates or the board can develop policy 
that ties funding to increased transfer rates as well as program completion. 



52 



13) What is (he Chancellor 's Office doing to address the need for better coordination 
between K-12 and community college vocational programs? How can local community 
college districts improve the alignment of curriculum with the secondary level career 
technical education programs? How can the board help accomplish this? The "Who Do 
You Want 2B" campaign is a collaborative marketing campaign between the California 
Community Colleges Chancellor's Office, the Academic Senate for California 
Community Colleges and the California Department of Education. It targets students ages 
1 2 through 1 9 and seeks to strengthen CTE pathways for incoming and current students 
by enhancing coordination and linkages among middle schools, high schools, ROCPs and 
California's community college system. The Chancellor's office is the fiscal agent for 
disbursement of SB70 funds designated for the Governor's CTE initiative to reinvigorate 
and rebuild CTE programs at the K-12 level and strengthen the programs at the 
community colleges. The SB70 workgroup has made funds available to establish CTE 
programs at more high school pannership academies. Funds are also being used for a 
CTE statewide articulation project to develop regional and institutional CTE articulation 
agreements so there is curriculum alignment and credit to students as they progress from 
one system to another. The BOG's has designated 3 members from each their board to 
the Joint Advisory Committee on CTE who\s ongoing charge is to monitor progress on 
the implementation of the Perkins plan and to improve ways to coordinate and along the 
CTE curriculum between K-12 and community colleges. 



14) How is the board kept informed of the effect of supplemental funding on the 
enrollment and retention of students in community college nursing programs? The board 
receives an annual update on the expenditure plan for the nursing programs. The report 
highlights enrollment and retention activities and outcomes. 

1 5) Is the Chancellor 's Office providing any direction to local community college 
districts regarding the sustainahility of these programs when supplemental funding 
decreases or is eliminated? 

There arc discussions underway that address the high cost of running these programs. 
Based on these discussions some colleges will be able to sustain some of the enrollment 
growth and retention practices that have occurred, while others will not be able to sustain 
these programs without additional sources of funding. 

16) Should the board play a role in fostering green technology CTE programs locally? 
The board is currently engaged in fostering and supporting green and clean technology 
CTE programs at both the district and regional level. In January the board took action 
and approved new grants to the community colleges for the development of new CTE 
programs that have a green or clean technology focus. The board is also supporting 

SB 1672 which proposed to train and educate a new skilled workforce to work in the new 
green / clean technology sectors. 



53 



54 



Senate Confirmation 

Carole A. Hood 

Chief Deputy Secretary, Adult Programs 

California Department of Corrections and Rehabilitation 

Responses to Senate Rules Committee Questions 

June 12, 2008 



Background 



On July 1, 2005, the Youth and Correctional Agency, including the Department of 
Corrections and the California Youth Authority, became the California Department of 
Corrections and Rehabilitation (CDCR). A key focus of the agency was intended to be 
rehabilitation. 

The 2005 reorganization created the position of chief deputy secretary, Adult Programs. 
Chief Deputy Secretary Carole A. Hood, who succeeded Marisela Montes in this 
position, has responsibility for three divisions: Community Partnerships; Education and 
Vocations Programs; and the Division of Addiction and Recovery Services. The 
administration has proposed a recidivism reduction strategy to be implemented by 
expanding in-prison programs, assessing inmate risks and needs, expanding alternative 
education, improving programs for female inmates, and expanding visiting days. 

General Questions 

1 . What are your goals and objectives as chief deputy secretary? What do 
you hope to accomplish during your tenure? How will you measure 
your success? Please be specific. 

My overall goal as chief deputy secretary is to institute programming opportunities that 
contribute to reducing recidivism and increasing safety within the California Department 
of Corrections and Rehabilitation (CDCR) institutions and within communities. 
Within institutions, the focus will be on two distinct facets: 

a. Providing a full menu of evidence-based programs within the six core 
programming areas identified by the Expert Panel on Recidivism Reduction 
(Expert Panel) and ensuring that inmates have access to these programs; and, 

b. Providing other structured activities to occupy an inmate's day in a constructive 
and meaningful way (i.e., the absence of "idle" time). 

Within communities, the focus will be on establishing formal partnerships with local 
public officials, community-based and faith-based organizations, and other interested 
individuals and groups to focus on offender reentry and reintegration. This will require 
identifying interested community leaders, defining roles and responsibilities, and 
ensuring that CDCR resources effectively target the right offenders and highest priority 
services and supports. 

Senate Rules Committee 

JUN 1 2 2008 
Appointments 55 



Senate Rules Committee June 12, 2008 

Carole A. Hood 
Page 2 of 29 



Ultimately, I will measure the success of these efforts in reduced recidivism rates; 
however, this measure is most likely two to three years away. In the meantime, I will 
use near-term measures that include: 

In-Prison Setting: 

a. An increase in inmate participation in core programs; 

b. An increase in the number of core programs offered; 

c. An increase in inmate participation in other activities (e.g., community- and 
faith-based programs and activities, self-help groups, etc); 

d. An increase in the number of other programs and activities offered by 
community- and faith-based organizations, self-help groups, leisure time groups, 
etc.; and, 

e. Decrease in disruptive behaviors and assaults on staff and other inmates. 

In-Community Setting: 

f. Establishment of formal offender reentry partnership agreements with at least 
ten local communities; 

g. An increase in parolee employment; 

h. An increase in the number of parolees with stable housing; and, 

i. An increase in participation in aftercare services for substance abuse treatment. 

I will establish a specific percentage increase/decrease for each measure when the 
baseline data is available. The targets need to be accurate and challenging, but also 
realistic. 

2. From your years as an administrator in various state agencies, what are 
the most important lessons you bring to your current position? What 
qualifies you to determine the most effective programs to implement in 
a correctional setting? 

There are several important lessons that I have learned through experience as a 
high-level administrator for most of my career and bring to my current position. First, to 
stay grounded in reality by actively engaging staff and those served (offenders and their 
families) within their environment(s) to determine relative needs and priorities as well as 
how to get the job done. It is too easy to become side tracked or even lose sight of the 
goal without this constant grounding. 

Second, I have also honed my skills and abilities to quickly grasp and assess difficult 
and complicated projects and situations, develop a sound and explainable approach to 
resolution, and follow-through to achieve a solid outcome. Moreover, I believe that I do 



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this in a collaborative way with staff and interested parties and in ways that engender 
support and enthusiasm. The ability to lead through difficult projects and trying times is 
one that I have been called upon to use throughout my career. 

Third, my years as a successful administrator are based on critically important personal 
characteristics - integrity, honesty and hard work - which I bring to this position. 
The most important lesson in all of this is transparency, which I interpret as meaning a 
willingness to share honestly the challenges, the less than successful outcomes, as well 
as the successes. 

Lastly, I bring to this position the tenacity and perseverance necessary to successfully 
implement a complex project and achieve the desired goals. I believe that this position 
will require the ability to stay relentlessly on task despite all obstacles - in other words, 
mountains of both tenacity and perseverance. 

While I am not a correctional professional, I believe that my educational and 
professional background enable me to know how to proceed in determining the most 
effective programs to implement in a correctional setting. I am a Sociologist by 
educational training and a health and human services administrator by profession. 
I have experience in the delivery of effective services and supports based on assessed 
needs, case planning, and case management. I also have experience in identifying 
program outcome measures and developing quality assurance systems. 
These experiences are central to principles and practices reflected in the Expert Panel's 
California Logic Model. 

I also have direct experience with many of the core programming areas identified by the 
Expert Panel as well as others (e.g., substance abuse, mental health, developmental 
disabilities, child welfare, welfare, health and community care licensing, and child 
support). In fact, in prior positions I was responsible for the state's developmental 
centers and state hospitals, which are both large institutions providing intensive 
behavioral, medical and custody services (both civil and criminal commitments). 
In addition, I have experience in overseeing the delivery of many of these services in 
the community through public service delivery systems. I believe that this experience is 
critically important because the programs that are delivered in custody are only part of 
the equation. What happens in the community to ensure access and continuity of care 
will most often determine success, not just the in-custody programming. Knowledge of 
community-based services and system is therefore equally important. 

With this background, I believe I know how to approach determining the most effective 
programs to implement in a correctional setting. At the same time, there is a significant 
body of literature about evidence-based programming in correctional settings; much of 
which has been analyzed and presented to CDCR by the Expert Panel and the 
Governor's Rehabilitation Strike Team. The Department has been funded to maintain 
the link to what works through consultants, expansion of the Office of Research, and 



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establishment of an Office of Program and Policy Development and Fidelity. There are 
also other program professionals within the Department including mental health 
practitioners, educators, and substance abuse treatment specialists. These resources 
together with the other correctional experts within the Department are available for 
consultation and advice as needed. 



Correctional Reorganization 

Your position was created in the 2005 reorganization of CDCR, and you are the second 
person to hold the job. 

3. The word "rehabilitation" became part of your department's name in the 
July, 2005 reorganization. How is rehabilitation being fostered? As a 
result, how are programs in prison different than in July, 2005? What 
improvements do you expect in a year? In five years? 

The word "rehabilitation" is certainly a central part of the language within the 
Department; however, the term likely has a different meaning for different people. 
Similarly, while it is widely recognized that "rehabilitation" is now part of the CDCR 
mission, it appears that some staff embrace and others do not agree or even reject the 
concept. Among the Wardens and other high-level staff, I would say that there is at 
minimum acceptance but, for most, there is enthusiasm about increasing opportunities 
for rehabilitative programming. Nevertheless, overall, it is not clear that there is a 
shared view or vision about the meaning, principles, or practices in making the term 
"rehabilitation" operational. 

Since 2005, the biggest problem in moving forward with rehabilitative programming has 
been the severe overcrowding of CDCR institutions, which has resulted in a lack of 
program space and serious population management problems. Within the past several 
months, there has been some population pressure relief which has enable focused 
attention on "back-to-basics" in managing the inmate population and enabling inmate 
participation in programming. This is a significant change since 2005, albeit it is a 
recent change. Placing attention on increasing program participation, together with 
teacher hiring and changes in the school calendar year, has already resulted in greater 
utilization of existing programs (i.e., an increase in the actual hours of participation). 
Between April 2007 and April 2008, utilization of academic programs has increased 
from 50 percent to 67 percent (34 percent increase), and for vocational programs from 
42 percent to 61 percent (45 percent increase). 

The nature of the academic and vocational programs has also changed since 2005. 
The Office of Correctional Education (OCE) adopted standardized texts for academic 
and vocational programs, and implemented the National Center for Construction 
Education and Research (NCCER) curriculum. These changes better link education 



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and vocation classes to community standards and connect to local labor market 
standards. The OCE also implemented the Alternative Education Delivery 
Models (AEDM), which provides additional education opportunities through Independent 
Study, Distance Learning Programs, or other non-traditional learning approaches 
designed to address the needs of special populations and/or the challenges of the 
environment (e.g., space, staffing [custody and teacher], etc). 

In addition, since 2005 the availability of Recidivism Reduction Strategies (RRS) funding 
has resulted in increasing rehabilitative programming both in prison and in communities. 
For example, RRS supported the addition of 19 vocational classes, funded the design 
and implementation of a risk and needs assessment instrument and individual case 
management plan, expanded substance abuse treatment programs, established a 
carpenter apprenticeship program, augmented day reporting center services, and 
supported implementation of the Senate Bill (SB) 618 Community Partnerships 
program. 

There has also been an increase in substance abuse treatment programming. 
There were 8,745 participants in in-prison substance abuse programs at the end of 
April 2007; at the same time this year, there were 9,040 participants. In addition, by the 
end of 2008, substance abuse programming will increase by 2,000 slots, up from the 
current treatment capacity of 9,669 slots. The prisons will add another 2,000 slots by 
mid-2010. The total 4,000 slots will represent an increase of more than a 40 percent in 
available programming. The utilization rate for substance abuse programs for the past 
several months has been steady at above 90 percent. 

There has also been an increase in substance abuse continuing care programs in the 
community since 2005. Continuing care programs include several treatment 
environments: residential; sober living; outpatient; drug treatment furlough (DTF); 
female offender treatment and employment program; and Parolee Services 
Network (PSN). Two new continuing care substance abuse programs 
started - SB 1453 and the In-Custody Drug Treatment Program (ICDTP) - were 
initiated in the prior 15 months. The number of participants in continuing care has also 
increased from April 2007 to April 2008, from 2,498 to 3,866 participants, up almost 
55 percent. When the 900 PSN participants are included, the total number of 
participants in continuing care programs is 4,766. While this is a step in the right 
direction, these increases are not yet sufficient to meet parolee needs in the community. 

During this year, utilization of existing academic and vocational programs is expected to 
increase greatly. The goal is to achieve a 75 percent utilization rate for existing 
programs by the end of this calendar year. Furthermore, the "proof project" sites will 
add new core programs recommended by the Expert Panel, such as Thinking for a 
Change, and Control Anger and Learning to Manage. These programs will be available 
at California State Prison (CSP), Solano and the first reentry facility, the Northern 
California Reentry Facility (NCRF). During the past few months, attention also has 



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been placed on increasing the availability of and access to community-based, 
faith-based, volunteer, and inmate-led programs and activities. It is expected that these 
types of programs and activities will also increase during this next year. 

Within the next five years, the expectation is that a full menu of rehabilitative 
programming will be available at each institution; the exception will be programs for sex 
offenders, which will be available at selected institutions. The menu will include a 
selection of programs in each of the six core programming areas recommended by the 
Expert Panel, as well as a full array of other community-based, faith-based, volunteer, 
and inmate-led programs and activities. The expectation is that all inmates will have an 
assessment and case plan to direct how they will spend their day and reduce "idle" time. 
Currently, about 50 percent of offenders participate in some type of program or activity 
assignment during their incarceration. During the next five years, the goal is to increase 
inmate participation in the right program, i.e. a program(s) that addresses his or her 
criminogenic needs, prior to release. 

4. Your predecessor said that her goals included expanding evidence- 
based prison and community programs. Do you share that view? In the 
year since Ms. Monies made that statement, what progress has been 
made toward those goals? Are there more evidence-based programs 
today serving more inmates? 

I share the view that increasing evidence-based prison and community programs is an 
important goal; however, there is more that I would like to add to the statement. 
Increasing evidence-based programs in prison requires that we improve what we have 
to comport with evidence-based principles and practices, and add to our repertoire of 
available programs by selecting and effectively delivering a limited number of new core 
programs. Just as important is the task of getting the right offenders to those programs, 
i.e., those with an assessed need(s) who can benefit from the program. 
Simply establishing the program is not enough. 

In the community, the challenge is similar but the scale is much greater. An array of 
CDCR purchased services is currently available in the community; however, it is not at 
all evident that these are the right services, in the right location, or serving the right 
parolee. A relatively small number of parolees (about 45 percent) participate in 
available programs, and most of this participation is the Parole and Community Team 
program, which are mandatory orientation meetings for recently released parolees. 
Again, the challenge is to ensure sufficient evidence-based programming is available 
statewide to enable a seamless transition from prison to the community. 

In the past year, as noted in the prior question, there has been some progress in adding 
a few new programs and/or serving more inmates. Mostly, the utilization rate for 
existing programs is steadily increasing and more capacity is starting to come on-line. 



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Therefore, while there are a few more evidence-based programs, more inmates are 
being served primarily due to increases in participation. 

5. Inmate custody is divided into five mission-based positions. What 
organizational structure do you use to implement program and stay 
informed of activities in the various prisons? 

The organizational structure used to implement programs mostly reflects the five 
mission-based disciplines. Adult Programs has three divisions: Division of Education, 
Vocations, and Other Programs (DEVOP), Division of Addiction Recovery 
Services (DARS), and Division of Community Partnership (DCP). The DEVOP has 
functional supervision for academic and vocational programming and is organized using 
the same five mission-based disciplines: reception center, high security/transitional 
housing, general population Levels 2 and 3 and community correctional facilities (male), 
general population Levels 3 and 4, and female offenders. Currently, the other 
two divisions are not organized by institution mission-based discipline. 

However, DARS is considering how best to organize as it begins to expand substance 
abuse programming into the full range of mission-based institutions. The DARS 
currently operates programs in 20 institutions, mostly in general population 
Levels 1, 2 and 3. The addition of 4,000 slots by mid-2010 means that substance 
abuse programs are anticipated to be operational in 28 of the 33 institutions, across all 
mission-based disciplines. Increasing services throughout the system presents the 
opportunity to reconsider the organizational structure. 

The DCP staffing level for programs it oversees in the institutions is not sufficient to 
warrant organizing by mission-based discipline. For example, there is typically only 
one or perhaps two staff responsible for oversight of Community Partnership 
Managers (CPM), religious programs, or inmate leisure time activity groups. 

Each division has established formal and informal communication mechanisms with 
each institution. This includes direct communication with the principal at each 
institution, supervisory staff assigned on-site to oversee each substance abuse 
programs, CPMs and chaplains. In addition, at the headquarters level, there is 
communication among the Division of Adult Institutions (DAI) and Adult Programs at all 
levels, including the directors and associate directors and staff. Some of the 
communication is through regularly schedule meetings and some is ad hoc or as 
needed. 

The rehabilitative programming reform project has also resulted in establishing a 
governance structure at both the state and local levels. A formalized governance 
structure is under review for implementation of Track 1 (increasing utilization of current 
resources) and Track 2 (implementing the "proof project"). The governance structure 
denotes the responsibilities of executive sponsors (typically undersecretaries or 



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chief deputy secretaries), project sponsors (typically division directors) and project 
managers (typically assigned staff). These organizational structures provide a forum for 
detailed information sharing about current operations at institutions. 

6. Senate staff have often visited prison education programs and found 
some classes shut down due to teacher absences, lack of substitute 
instructors, or lockdowns. If staff observed classes today, would they 
see more classes operating with more students? What is your role in 
recruiting teachers to vacant positions? 

Yes, more classes would be operating and more enrolled students would be attending 
available classes. However, there is still variability statewide in terms of actual student 
participation in available classes by institution. Based on data as of March 31, 2007, 
the Assembly Bill (AB) 900 benchmark measure date, utilization of academic programs 
by institution ranged from a low of 12 percent to a high of 89 percent, with a statewide 
average of 50 percent. Similarly, utilization of vocational programs by institution ranged 
from a low of 18 percent to a high of 63 percent, with a statewide average of 42 percent. 

As part of the analysis leading to Track 1 implementation, i.e. to increase utilization of 
existing programs, data regarding the reasons for program closures was also analyzed. 
The program closure reasons are about evenly divided between custody, modified 
programming and lockdowns, and education, teacher vacancies, absences, on-the-job 
training, special assignments, etc. Both of these reasons are the focus of attention in 
Track 1 implementation - managing the inmate population and increasing participation 
in existing programming. 

There are a number of factors to address in increasing classroom operation. First, filling 
teacher vacancies is one important factor and there has been some success in this 
regard. The Department of Personnel Administration negotiated revisions to the salary 
and school day year for adult institution academic teacher and vocational instructor 
classifications to bring into statewide parity with public schools, county offices of 
education, and the bargaining agreement between CDCR Division of Juvenile Justice 
and the California State Employees Association, Bargaining Unit 3 which took effect 
April 1, 2007. During fiscal year (FY) 2007-08, a focused recruitment effort, using a 
CDCR teacher recruitment team, resulted in increasing the teacher workforce by 
175 positions, from 1,217 positions to 1,392 positions over the prior year out of a total of 
approximately 1,520 positions statewide. While it was necessary to hold some positions 
vacant during FY 2007-08 to fund the pay parity increase, an additional 121 positions 
are budgeted in FY 2008-09. Recruitment for these positions is underway pending final 
approval of the Governor's Budget for FY 2008-09. 

Second, the new instructional day calendar is intended to increase actual instructional 
time. Prior to the new contract addendum, teachers who used all potential available 
days off could have provided as few as 188 instructional days per year. A reduction in 



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the school calendar year (from 261 to 220 days) together with the elimination of other 
time off (e.g., vacation, testing days, block training, etc) actually should increase time in 
the classroom. 

Third, other barriers to classroom operations will also be addressed including, but not 
limited to, the lack of substitute teachers. 

My role in recruiting teachers to vacant positions is to ensure that the DEVOP 
leadership team has a sound teacher recruitment and retention plan in place, and to 
monitor monthly authorized and vacant positions statewide and by institution. 



AB900 

On April 26, 2007, the Legislature approved AB 900 (Solorio), Chapter 7, Statutes of 
2007, the Public Safety and Offender Rehabilitation Services Act of 2007. The act was 
intended to finance construction of living and program space for 40,000 state inmates 
and create a broad range of performance measures that the department must meet. It 
also was supposed to expand a number of existing programs such as in-prison drug 
treatment, require that all new bed space be accompanied by rehabilitation services, 
and provide incentives to increase inmate participation in education programs. 

7. What role do you play in meeting the goals of AB 900? Upon 
observation, would there be visibly more programming than a year ago? 
What would Senate staff see on an inspection tour? 

I am responsible for establishing the overall plan for implementation of AB 900. 
In addition, I have direct responsibility for implementing key components of AB 900 
related to instituting and overseeing rehabilitative programming. In this role, I partner 
with my chief deputy secretary colleagues, the chief deputy secretary for 
Adult Operations and the chief deputy secretary for Facilities Planning, Construction 
and Management, who are responsible for other components of AB 900, e.g., facility 
construction, operation of adult institutions, including reentry facilities, and adult parole 
operations. 

There would be more programming upon observation at some institutions than there 
was a year ago. More programming primarily means an increase in program 
attendance, with some new programs. However, having said this, I would not want to 
suggest that this is uniform or consistent among all institutions. As part of Track 1 
implementation, baseline measures for programming will be developed for each 
institution. During the next year, there will be a noticeable increase in programming 
statewide. 



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Accountability 

8. Former Secretary James Tilton said that one of the biggest issues 
facing the department was "lack of programs." How have you sought to 
add programs that have been shown to be effective either in California 
or other states? Have you sought to discontinue ineffective programs? 
What standard do you use to determine the effectiveness of a program? 
Are you responsible for program creation and/or elimination? 

The Expert Panel Report provided guidance on evidence-based programming in 
six core program areas found to be effective in other states. The CDCR primarily offers 
programs in two of these areas: academic and vocational education, and substance 
abuse treatment. Adult Programs is in the process of procuring new core programs in 
each of the other areas as part of the "proof project" sites. The goal is to add at least 
one program in each new core program area, which includes: (a) aggression, hostility, 
anger and violence; (b) criminal thinking, behaviors and associations; and (c) family, 
marital and relationships. The fourth new core program area is sex offending which, 
given the greater complexity of this programming area, will require additional study 
before moving forward. Upon successful implementation of these new programs at the 
"proof project" sites, statewide implementation is expected to move quickly. 

An initial evaluation of the 34 CDCR-offered programs identified by the Expert Panel 
has been completed. The Expert Panel evaluated 1 1 of these programs as part of the 
report issued in June 2007; evaluation of the remaining 23 programs was completed by 
CDCR under contract with the University of California, Irvine Center for Evidence-Based 
Corrections. The California Program Assessment Process (CPAP) tool was used to 
complete these evaluations. The CPAP evaluative factors include, but are not limited to, 
whether the program: assesses risk and targets high-risk; assesses criminogenic needs 
and delivers services accordingly; has a clearly articulated theoretical model; and has a 
program manual and/or curriculum. Overall, the evaluations found that most programs 
have elements that were in-line with evidence-based practices, although several 
programs scored relatively low. 

The Office of Research is using this evaluative information to complete more in-depth 
reviews of the programs found lacking to identify how to modify or eliminate ineffective 
programs. The Correctional Program Checklist (CPC), a nationally recognized and 
validated assessment tool, will be used to make this final determination. Eighteen staff 
have been trained in use of the CPC tool, and final evaluations will be completed as part 
of Track 1 implementation. The CPC uses evaluation standards founded on 
evidence-based practices and principles or what has found to contribute to reduced 
rates of recidivism. 



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One word of caution, while ineffective programs will be re-tooled or eliminated it should 
be noted that the evaluative tool determines which programs adhere to evidence-based 
principles and practices. The process of re-tooling or eliminating existing programs 
must recognize the need to proceed cautiously and without creating the unintended 
consequence of more inmate "idle" time. Moreover, while it is recognized that a full 
menu of evidence-based programs must be available in core programming areas to 
address inmate criminogenic needs, there are other programs or activities that are vital 
to occupying the day in a constructive and meaningful way. These non-evidence-based 
programs or activities also should be fostered including leisure time, self-help or other 
pursuits. 

9. Are you responsible for monitoring the quality and effectiveness of 
educational, vocational, or self-help programs at each institution, or is 
that the warden's job? If you are not the person responsible, who is and 
what role do you play? 

The wardens and I share complementary, but distinct, responsibilities for monitoring the 
quality and effectiveness of educational, vocational, and self-help programs at each 
institution. Adult Programs, for which I am responsible, provides the professional 
standards governing the operation of these programs, as well as the expertise in 
delivering these services. However, the responsibility for day-to-day supervision and 
oversight falls under the jurisdiction of each warden. It is expected that each warden 
will understand the overall operating requirements and standards for each program, and 
the measure used to monitor performance. 

10. Who is responsible for self-help programs such as Alcoholics 
Anonymous, Narcotics Anonymous and anger management? Who 
monitors them to assess quality? 

The responsibility for self-help programs is described in the response to question #9. 
At this time, there is little to no monitoring to assess quality and, consequently, it is likely 
that there is some variability in the delivery and effectiveness. However, these types of 
self-help programs typically follow generally accepted community-based standards for 
delivery. I have initiated a project to collect baseline data on currently operating 
programs, with the intent to fully utilize and/or expand existing capacity. The project will 
result in identifying options for increasing programs as appropriate, and requirements 
and funding needed to support such expansions. The project is underway at 
three institutions: California Institutions for Women (CIW), California Institution for Men, 
and Deuel Vocational Institution (DVI). Instructional letters were issued in early April and 
May 2008. 



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11. How do you ensure uniformity among the various educational, 
vocational and self-help programs at all of the institutions within the 
CDCR system? 

Standardized delivery of programs is a key concern in ensuring that programs adhere to 
evidence-based principles and practices, and are delivered in a manner consistent with 
the intended design. In fact, while many existing programs use evidence-based 
curriculum, the delivery may not be in accordance with the design. This is one reason 
for differences in the effectiveness of the same programs in different settings. 
Consequently, statewide consistency in delivering standardized programs is very 
important. 

To address this concern, Adult Programs has undertaken a focused effort to increase 
standardization in the delivery of existing core programs. DEVOP began this effort in 
the fall 2007 for education programs by creating curriculum modules and testing 
requirements. This focus is on program standardization, program fidelity, alignment of 
curriculum to industry-certified national standards, and alignment of academic 
curriculum to the California Department of Education's adult education standards for 
high school completion. Anticipated outcomes are more effective monitoring of inmate 
progress and improved outcomes in terms of successful milestone and program 
completions. 

With regard to uniformity among self-help programs at all institutions, the process 
described in the response to question #10, is intended to address this issue. 



Expert Panel 

In the 2006-07 Budget, the Legislature funded an effort to convene an expert panel 
made up of corrections officials and academics from around the country. In its report 
last year, the panel urged the enactment of legislation to expand the state system of 
positive reinforcements for offenders who successfully complete their rehabilitation 
program requirements, comply with institutional rules in pnson, and fulfill their parole 
obligations in the community. It recommended laws that would allow CDCR to award 
earned credits to offenders who complete any rehabilitation program, such as 
substance abuse treatment or life skills development, in accordance with their behavior 
management plans. The panel also said CDCR needed to improve the quality of reentry 
education programs. 



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1 2. What has happened since the panel report was published? Have you 
moved toward fulfilling the panel's recommendations and, if so, what 
has been the result? 

A lot has happened since publication of the Expert Panel Report in June 2007. 
The report contained 11 recommendations and 35 sub-recommendations, which 
addressed many areas including two pre-conditions for effective rehabilitative 
programming: reducing overcrowding and establishing a program participation 
incentives system. The above introduction to the Expert Panel notes that the program 
participation incentives issue includes recommendations specific to earned credits 
(there are four recommendations or sub-recommendations in this area). 
Adult Programs reviewed the entire spectrum of participation incentives, including the 
use of earned credits, and concluded that this along with other incentives are needed to 
establish a rehabilitative environment within prison as well as while on parole. 

Adult Programs prepared a discussion paper that is currently under review within the 
Department. It suggests a comprehensive approach to creating a rehabilitative 
environment. Existing regulations and operating procedures provide for a robust 
system of incentives and disincentives. However, over time prison overcrowding has 
made it difficult to implement and pay attention to this system. Therefore, it is suggested 
that components of the program participation incentive system should include: 
(a) reinstituting the privilege and disciplinary processes; (b) revisiting the current inmate 
assignment process; and (c) establishing tangible earned incentives - financial and 
earned credit. Track 1 implementation addresses both (a) and (b), tangible financial 
incentives are being considered, and earned credit is under discussion with the 
three-judge court panel. 

Other recommendations of the Expert Panel are in various stages of implementation. 
For example, there are 12 recommendations and sub-recommendations relating to 
using a risk assessment tool, one relating to case planning, eight relating to delivering a 
core set of programs, and so on. A progress report on implementation of rehabilitative 
programming reforms was recently submitted to the California Rehabilitation Oversight 
Board established by AB 900. 

13. The department is phasing in a new treatment model using what it calls 
"proof projects" or demonstration projects, such as one located at 
Solano State Prison. Please describe your role in the Solano pilot 
project. How are you deciding which programs to institute as part of the 
project? What is the status of the Solano pilot program? 

I am actively involved in the Track 2 implementation of the "proof project" at four sites: 
a reception center, DVI in Tracy; a prison, CSP-Solano; a secure community reentry 
facility, the NCRF in Stockton; and parole, Parole Region I serving the counties of 
San Joaquin, Calaveras and Amador. A governance structure is in place and detailed 



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work plans developed for CSP-Solano and NCRF. The work plan for the reception 
center is underway; soon to be followed by the plan for the parole region. 

The implementation process for CSP-Solano began in late 2007 with the Track 1, 
Solano Project, which focused on population management as a precursor to 
establishing an environment that enables rehabilitative programming to occur. 
The Track 1 effort to increase utilization of existing programming has moved forward 
quickly, resulting in the removal of some inmates and an increase in the ability to 
program. The recent decline in the statewide prison population has also enabled the 
removal of "bad beds" and restoration of gyms and other non-traditional space at 
CSP-Solano. 

Solano has now moved into the Track 2 implementation planning stage of the 
"proof project." A number of activities are underway including, but not limited to: 
administration of risk and needs assessments; design of the case flow, case plan and 
case management process; and procuring the selected new core programs. As noted 
in a previous response, new core programs have been selected based on the 
recommendations of the Expert Panel and using decision-making criteria/matrix to 
arrive at a final selection. The intent is to deliver these programs initially using 
contracted providers; as experience is gained, future delivery methods will be 
re-evaluated. In addition, many other implementation issues are identified daily and 
addressed using issue resolution and system design documentation processes. 
The Solano "proof project" full implementation will begin early in FY 2008-09. 



Risk and Needs Assessment 

Since the departmental reorganization, many CDCR administrators have referred to the 
goal of providing every inmate with a risk and needs assessment that would be 
conducted immediately upon intake and used continuously through parole. 
The education department is now conducting these assessments. 

14. What is your understanding of the status of this effort, and explain how 
your division has been involved? Is the assessment being done at all 
reception centers to all new inmates? How are you incorporating the 
assessment into decisions regarding inmate placement? Over time, 
what effect will it have on programs? 

The goal is to conduct a risk and needs assessment of inmates during the intake 
process at reception centers. Although the intent is to assess all inmates, there may be 
some limited circumstances where this may not be appropriate, e.g., inmate with less 
than 35 days to serve who will parole directly from the reception center. There are 
approximately 11,000 intakes per month, with the majority comprised of new 
commitments (about 34 percent) and parole violators pending revocation (about 



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45 percent). Female offenders comprise about 10 percent to 12 percent of the total 
intakes. It is further intended that a risk and needs assessment be performed 
periodically but at least as part of the reentry planning process. The frequency and 
reasons for reassessment are being determined through the case planning and 
management design process. 

To begin, the Department has selected the Correctional Offender Management Profiling 
for Alternative Sanctions (COMPAS) as the risk and needs assessment instrument. 
The risk and needs assessment process began as part of the parole pre-release 
planning process and has evolved during the past year in several other areas. 
Modifications and enhancements either have been made or are contemplated to the 
original COMPAS instrument, including modules for: a core COMPAS for males and 
females; a reentry COMPAS for males and females; and an automated Institutional 
Staff Recommendation Summary (ISRS) report. The intent is also to modify the 
COMPAS instrument to incorporate the California Static Risk Assessment model, and 
replace the current static risk factors. 

Adult Programs has been involved throughout the process to select and hone use of the 
COMPAS risk and needs assessment instrument. While my staff are key members of 
the project team their primary focus has been on implementing COMPAS at reception 
center intake. As of early November 2007, the COMPAS instrument was implemented 
at all reception centers. Presently, the risk and needs assessments are performed by 
22 teachers, with almost 13,000 assessment conducted to date. Current staffing levels 
do not permit all inmates to receive an assessment at intake. Additional resources are 
included in the Governor's Budget for FY 2008-09 to increase staffing to perform 
assessments. These new resources, together with other modifications to the intake 
process, will enable completion of a COMPAS assessment for most inmates at intake. 

Initial steps have been taken to incorporate the COMPAS risk and needs assessments 
into the classification and endorsement process. On February 14, 2008, instructions 
were issued to Classification Staff Representatives (CSR) at reception centers to use 
COMPAS assessment data (if available) in conjunction with the ISRS or the 
Reception Center Readmission Summary when endorsing an inmate for transfer from a 
reception center to a prison. The instructions direct CSRs to match the level of 
treatment services to the risk level of the offender to house inmates at facilities that offer 
the custody level and program services suggested by the COMPAS assessment. 
Since all prisons offer educational services, these instructions mostly impact inmates 
with a substance abuse need. The instructions direct CSRs to refer an inmate with an 
identified need for substance abuse treatment to an institution with a substance abuse 
program. 

There will be additional refinements to the use of COMPAS assessment data in making 
initial endorsements to an institution and assignments to programming. In addition, 
secondary assessment instruments have been selected and will be used to inform the 



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development of individual case plans for inmates determined moderate to high risk to 
recidivate. Over time, these COMPAS and secondary assessments will allow more 
effective alignment of inmate treatment and programming needs with institutional and 
programming assignments. Moreover, the aggregate assessment data derived from the 
COMPAS assessment process will be used to identify unmet needs and assist in 
planning resource development in prisons and in the community. 



Academic Education and Literacy 

Based on data provided by your office in 2007, approximately 10,500 inmates, or 
roughly 6 percent, are enrolled in academic classroom work, which can lead to earning 
a GED diploma. Based on data provided by your office last year, the average reading 
level of CDCR inmates is approximately 7.1 grade level for males and 8.0 grade level 
for females. 

15. Beyond the work of the expert panel, are there efforts underway to 
explore other possible options to increase the number of inmates who 
might earn a GED? What efforts are underway to improve literacy levels 
among inmates? 

The OCE has initiated efforts to increase the number of inmates who might earn a GED 
through other possible options referred to as AEDM. The AEDM approach, which was 
contractually negotiated and instituted at institutions statewide, provides educational 
services through non-traditional educational delivery methods. Several AEDM models 
should contribute to increasing the number of inmates earning a GED. 

a. Part-Time School Attendance/Independent Study: This delivery model allows 
inmate students reading above a 9.0 grade level to attend school halftime, and 
participate in independent study half time in the living unit. This allows teachers 
to provide direct instruction to twice as many students in these GED-preparatory 
type classes, 27 students in the morning, another 27 students in the afternoon. 

b. Independent Study: This delivery model provides just an Independent 
Study Program, which allows inmates not enrolled in an education assignment to 
receive remedial or GED-preparatory instruction from an Independent Study 
program teacher who maintains a student to teacher ratio of 120:1 . 

c. Educational Television Programming: This delivery model allows inmates to 
participate in specific educational television programming. Each institution was 
authorized a Television Specialist position as well as standardized media 
equipment specifically designated to run multiple DVD recordings of educational 
programs. Many of these programs contain GED preparation materials such as 
Kentucky Education Television (KET) and Transforming Lives Network (TLN), 
formally known as Correctional Learning Network. 



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d. Distance Learning Program: This delivery model allows for a more formal 
Distance Learning Program in which teachers provide KET and TLN materials to 
inmates participating in these on-air programs. Because the programs are 
available both live and on DVD, the Television Specialist is able to schedule 
viewing times that accommodate inmates in full time work assignments 
regardless of shift or days off. 

In addition, the Incarcerated Youthful Offender Program (IYO) assists a select group of 
inmates in receiving their GED. The IYO is a federally funded program to assist a select 
group of inmates less than 25 years of age with less than five years to serve in receiving 
their GED. The IYO coordinator is able to proctor exams directly for these inmates 
outside of Education Department programming. 

With regard to improving the literacy levels among inmates, there are several efforts 
underway but it is not entirely clear that these are sufficient. For example, adoption of a 
standardized text for each of the Adult Basic Education levels (I, II & III) in reading and 
mathematics should assist in improving inmate literacy levels by establishing a 
consistent, high quality instructional methodology between classrooms and institutions. 
The standardization not only improves quality but also helps in maintaining an inmate's 
educational progress, which previously was hindered when he or she transitioned from 
program to program within an institution's own education department, or when 
transferring to another institution. Vocational program instructors also have 
standardized curriculum and texts and are required to provide students with a minimum 
of one hour a week of literacy instruction. 

There are also other literacy programs coordinated through distance learning or 
independent study, peer tutoring, and federally funded remedial education for inmates 
21 years of age or less. The Peer Tutoring Literacy Programs provide formalized 
training to inmate tutors in internationally recognized programs such as Laubach Tutor 
Training, who then voluntarily provide literacy tutoring to interested inmates during 
non-work/school hours. The federally funded remedial and literacy programming is 
available for inmates under 21 years of age under the Elementary and Secondary 
Education Act. 

Having said this, I plan to revisit possible options to enhance current efforts to improve 
inmate literacy levels. This area is critical in assisting offenders in successful 
community reentry and, it would appear, much more could be accomplished using low 
or no cost options. 



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16. What use does CDCR make of inmate tutoring programs? What do you 
believe are the barriers to more widespread use of inmate tutors? Every 
CDCR institution employs at least one librarian and library clerks. To 
what extent are they involved in inmate tutoring programs? 

The CDCR does make use of inmate tutoring programs, but they seem to be mostly 
"home grown" based on individual warden, staff interest and/or community-based 
groups or volunteers. This means that there does not appear to be a consistent 
statewide approach to the use of inmate tutoring programs. Based on the information 
currently available to me, I do not believe that CDCR makes full use of the potential for 
inmate tutoring programs. 

The barriers to using inmates as tutors are mostly related to space, custody, and the 
lack of a structure to initiate and oversee a tutoring program. An institution's library 
space has traditionally been the optimal area for inmate tutoring programs as it is 
accessible to all general population inmates and operated during various days, evening, 
and weekend shifts. The space is staffed with both librarians as well as custody 
officers, and offers an atmosphere conducive to learning. Unfortunately, the challenges 
in librarian recruitment have created numerous vacancies statewide that prevent 
institutions with multiple yards and multiple libraries from maintaining continuous 
operating hours throughout the week. Options to recruit and retain librarians are under 
consideration. Therefore, I would say that librarians and library clerks are not currently 
involved in any consistent statewide manner in inmate tutoring programs. 

While the use of librarians/library clerks may be an option, there may be others as well. 
For example, this is an area where community-based, faith-based, volunteer, self-help 
or other groups or individuals could also be encouraged to become involved. In all 
circumstances, it will be necessary to consider how use of inmate tutors and/or other 
individuals to increase inmate education levels and literacy will work. Areas such as 
space needs, custody or other supervisory staffing, and inmate participation incentives 
for tutors as well as inmates will be explored further, particularly as we expand the 
opportunities for all inmates to participate in meaningful activities and reduce "idle" time. 
This is undoubtedly an under-utilized resource. 

17. What use is made of distance learning in CDCR institutions? Are any 
efforts underway to enhance the use of distance learning given the 
limited available classroom space? Please be specific. 

As described in my previous response to question #15, distance-learning opportunities 
are offered through institutions with approved AEDMs. Distance learning teachers 
coordinate not only with the Television Specialists with on-air programming, but also 
coordinate with accredited schools offering correspondence courses to incarcerated 
adults. The Distance Learning Program teacher assists students in scheduling classes, 
processing textbooks into the institution through the mail, and proctoring exams. 



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In most instances, the distance-learning teacher utilizes shared space, or maintains 
work hours outside of regular classroom programming hours, in order to minimize 
impact on limited classroom space. 

I am not aware of any specific statewide effort currently underway to enhance the use of 
distance learning; however, I suspect that individual institutions likely have plans to do 
so. This is another area that I will pursue and, in particular, exploring the potential for 
partnerships in with local schools and colleges, such as the arrangement with 
Palo Verde Community College District, and others (see below response). 

18. Ironwood State Prison has a partnership with Palo Verde Community 
College District that allows inmates to earn Associate of Arts degrees 
through distance learning. Do you have plans to replicate this program 
elsewhere? 

The OCE has expanded partnerships with several institutions to provide the opportunity 
for inmates to earn higher education degrees. Several institutions have independent 
partnerships with local colleges to provide Associate of Arts and Bachelor of Arts 
degree opportunities for inmates. For example, Chaffey College works in cooperation 
with several of the women's facilities, while Patton College offers programming at San 
Quentin. The OCE has also entered into a partnership with Coastline Community 
College to provide correspondence courses at all 33 institutions through DVD 
instruction. 

While there were no specific plans to replicate this program elsewhere, I am interested 
in all opportunities to replicate the Ironwood State Prison (ISP) or other successful 
models. These options will be explored through local colleges and the Community 
College System. 



Substance Abuse Programs 

The Division of Addiction and Recovery Services was created to improve the 
administration of substance abuse programs and improve outcomes for participants. 
This division is under your jurisdiction. 

19. How do you work with this office? How do you monitor the 
effectiveness of substance abuse programs? 

I am responsible to oversee the operation of the DARS, and do this by providing 
guidance and supervision to the DARS director. The DARS was elevated from an office 
to a separate division in early 2007 in order to provide more focused attention in 
remedying the findings of an Office of Inspector General (OIG) report. The OIG report 
found that CDCR substance abuse programs were failing and required significant 



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re-tooling to improve effectiveness. This change created the direct reporting relationship 
between the DARS director and my position. 

The current director of DARS has significant knowledge and experience in the field of 
addiction and recovery, including serving as chief deputy director for the 
California Department of Alcohol and Drug Programs and working in community-based 
programs. Consequently, I have focused my attention on monitoring actions to remedy 
the performance issues identified by the OIG, expanding the availability of in-prison 
substance abuse services (as required by AB 900), and expanding utilization of 
aftercare services including SB 1453, the ICDTP, and the DTF program. 

In the past 15 months, a number of changes have been made in the operation of 
substance abuse programs to improve the ability to monitor program effectiveness. 
Private providers deliver substance abuse services, both in prison and in the 
community, under contract with CDCR. DARS has changed the procurement and 
contract documents to add clearly stated deliverables and performance measures. 
DARS collects data monthly from contract providers to track program participants, 
number of program completions, average length of stay, and show-up rates to 
continuing care programs. Staff was also trained on appropriate budget protocols, 
improving the monitoring of spending and use of contract funds. These changes have 
increased program monitoring and accountability, and provide me with baseline data to 
monitor overall program status. 

In addition, DARS has improved operation of in-prison substance abuse programming 
by monitoring the impact of security or custody issues that interfere with effective 
program delivery. The OIG identified nine programs at seven institutions where security 
or custody reasons had significantly affected the delivery of treatment services. 
Following an extensive review of each site, DARS relocated some programs and 
worked with wardens to restructure yards and appropriately reduce lockdowns to enable 
effective service delivery. DARS also began tracking lockdown data on a weekly basis 
at institutions where contractors administer treatment programs. I also review this data 
weekly and confer as appropriate with the director of DARS or the DAI if continuing 
lockdowns are interfering with the ability to program. 

The DARS has also established a Treatment Advisory Committee (TAC), a group of 
substance abuse treatment experts, to modify and develop programs to treat a wider 
range of inmate needs. DARS is moving to restructure all in-prison substance abuse 
programs into three levels of treatment, which will address intensity of services 
constrained by the inmate's time left to serve. This approach, along with new inmate 
assessment, case planning and management, should enhance the ability to target the 
right interventions, to the right inmate, at the right time. 

The DARS is training and certifying inmates with life or longer-term sentences as 
mentors to lead treatment groups. This is proving to be an effective service delivery 



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model; inmate led treatment groups contribute greatly to the therapeutic community 
model. This area will be pursued for expansion. 

The DARS has also initiated the process of creating a Program Accountability 
Team (PAT) to effectively monitor and assist in-prison treatment providers. The PAT 
will use evaluation tools validated by the TAC for quarterly monitoring of program 
effectiveness and fidelity. The quarterly program visits will result in a written report to 
the on-site treatment program director that identifies areas in which improvements or 
modifications are required. 

All new in-prison contracts will now include additional performance measures. 
The performance requirements and measures include, but may not be limited 
to: performance targets; three levels of treatment to address different levels of addiction; 
a required 1:15 counselor to inmate ratio; certification of counseling staff; and 
gender-specific treatment models. This performance data will enhance oversight and 
accountability to ensure that treatment programs are providing high quality services. 

Program monitoring and accountability also have increased for community-based 
Substance Abuse Services Coordinating Agencies (SASCA) contracts. DARS collects 
data from contracted providers weekly and monthly. This allows DARS to provide 
information on SASCA participants by program, percent of completers, average length 
of stay, and show-up rates to continuing care substance abuse programs. DARS can 
also run queries to determine the rate of return to prison of program completers versus 
those that do not receive continuing care. DARS has several databases that provide 
information on the many different community-based continuing care programs including, 
SB 1453, ICDTP, and DTF. 

The current SASCA contracts also contain language to require outreach at in-prison 
substance abuse programs. These efforts along with the in-prison substance abuse 
program efforts and the new aftercare programs have resulted in increased participation 
in aftercare programs. In December 2006, there were 2,339 participants in aftercare 
programs; today there are 4,010 participants, an increase of more than 70 percent. 
This number excludes the 900 participants in the PSN. 

These tools allow me to monitor the overall effectiveness of substance abuse programs; 
however, we are working with the CDCR Office of Research to further my, and/or create 
new, databases to produce additional standardized baseline data reports. 
The information presently available gives me a relatively good overall sense of program 
performance, but as we proceed in expanding rehabilitative programming, additional 
and routinely collected data will be necessary. 



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20. What should be done to encourage or require more inmates to 
participate in aftercare when they are paroled? 

There are two key actions that should encourage and/or require more inmates to 
participate in substance abuse program aftercare in the community. First, the new 
treatment contracts require that 75 percent of inmates participating in in-prison 
substance abuse programs should continue in community aftercare programs. 
The previous participation standard was 50 percent. The contracts also require that 
providers conduct secondary substance abuse assessments to ensure appropriate 
placement of addicts in treatment programs. Improper placement of participants without 
an addiction results in disruption to treatment programs. 

Second, there has been an expansion in mandatory aftercare programs. In 2006, 
enactment of SB 1453 mandated 150 days of residential aftercare for most non-serious, 
non-violent offenders who have completed an in-prison substance abuse program. 
There is evidence that offenders who complete 90 days or more of residential aftercare 
have much lower recidivism rates than those who do not receive aftercare. 

SB 1453 also provides the incentive of releasing specified parolees from parole 
who successfully complete the program. DARS has contracted with California 
State University, Long Beach, for a study of the effectiveness of SB 1453, and will be 
submitting an outcome report to the Legislature in January 2009. 

In addition, other programs work in a similar fashion by enabling offenders to participate 
in substance abuse programs. For example, the DTF program and the ICDTP. 
The ICDTP has been expanded during the past year in response to the Valdivia lawsuit, 
with capacity increasing to over 1,800 slots and over 1,500 participants. 

21. CDCR currently contracts with "outside groups" to provide drug and 
alcohol services both inside and outside prison. Do you know your 
plans with respect to this model? Will you continue to use this model or 
are you considering alternatives? 

Alternatives to the current model are under consideration. The Expert Panel 
recommendations address the delivery of core programs, of which substance abuse 
programs are one, in both prison and community settings. In either setting, the Expert 
Panel recommends that programs serve offenders determined moderate to high risk to 
recidivate. Currently, services and supports are purchased by several organizational 
entities within CDCR, including parole, DARS, and the female offender program. 
An alternative model is necessary to enable purchasing of all services and supports in 
multiple settings (in prison, reentry facilities, and communities) through a 
comprehensive and uniform statewide approach. 



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Alternative models and options will be developed in the near-term. One such option is 
the use of a regional broker responsible to certify service providers based on CDCR 
established qualifications and standards, set rates using uniform methods and criteria, 
and to monitor and oversee performance. There are likely other options that will also be 
developed. The intent of this approach is to develop a comprehensive approach to 
purchasing services based on statewide criteria while also recognizing local reentry 
needs. 



Vocational Education 

The Prison Industry Authority (PI A) operates a variety of programs, which are thought to 
be very good preparation for jobs on the outside, but the PI A reports to the CDCR 
secretary and is separate from your division. 

22. Are you able to coordinate activities with PI A? If so, how? 

Yes, I am able to coordinate activities with Prison Industry Authority (PIA) through the 
General Manager and PIA staff. Coordination occurs through several means including: 
regularly scheduled quarterly meetings regarding PIA use of RRS funds; information 
sharing relative to proposed changes in PIA policy related to inmate participation; and, 
consultation regarding proposed changes in vocational training and programs. The PIA 
General Manager has also been extremely helpful in coordinating the building and 
installation of new modulars necessary to expand existing programs, including the new 
2,000-slot expansion of the substance abuse program. Other collaborative efforts are 
also under discussion to assist in the expansion of vocational training opportunities. 

The PIA has an important role to play within the continuum of academic and vocational 
training opportunities available for inmates within the prison setting. I would like to 
expand further the working relationship with PIA to ensure that we fully integrate their 
services within the rehabilitative environment that we are attempting to create within 
each prison. PIA also has considerable experience and successes that can be helpful 
to development and expansion of vocational programming in general. 

23. Is there a standard currently in place to assess the appropriateness or 
value of specific vocational programs with respect to employment upon 
release? Is there coordination with vocational training programs at 
community colleges so parolees might continue their training to reduce 
recidivism? 

There are efforts in place to assess the appropriateness or value of specific vocational 
programs in terms linked to employment upon release; however, current efforts are 
being enhanced and standardized statewide in order to work effectively. 



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The CDRC is beginning implementation of the California New Start 
prison-to-employment program, which will provide the direct linkage between academic 
and vocational programs and getting a job. Key components of this program are the 
classification of training to national employment/job classification standards (Standard 
Occupational Classification system), and providing training based on labor market job 
growth projection data. These changes will provide the link between the value of 
training and actual employment. 

The OCE is currently researching job viability for each of the standardized vocational 
program curriculum offered at each institution. Part of the research includes looking at 
the specific counties and their employment needs and the locations of inmates who 
would be paroling to that county. For example, construction trades may have higher 
employability in Los Angeles and San Bernardino counties, but low employability in 
Humboldt or Lassen counties. Therefore, it would be appropriate to institute vocational 
programs in construction trades at institutions where the majority of the inmates parole 
to Los Angeles or San Bernardino counties. 

Utilizing the national NCCER standards also allows inmate trade certifications to be 
entered in the NCCER national database for employers to verify job readiness and 
qualifications. At the same time, many vocational instructors actively use the 
Trade Advisory Committees to assist them in knowing the current industry standards as 
well as employment trends. The advisory committee members are associated with 
trade unions, providing a linkage for employment eligible inmates upon parole. 
These program elements will be enhanced and formalized through the 
prison-to-employment program. In addition, the CDCR Office of Research is working 
with Adult Programs to develop baseline measures needed to assess the impact of 
training on parolee employment and job retention. 

Although CDCR is establishing new relationships with community colleges in other 
areas, to my knowledge there has not been an effort to coordinate vocational training 
programs with community colleges so that offenders can continue their vocational 
training upon release to parole. I will certainly pursue this avenue. The community 
colleges are collaborating with CDCR in two new areas: contracted education services 
to provide staff training in new rehabilitative programming areas; and, certification 
programs to enable job growth opportunities for CDCR staff and other individuals 
interested in CDCR employment. Several community colleges also currently provide 
inmate education programs, such as those referenced in question #18 relative to ISP 
and Palo Verde Community College District. 



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SB 618 

In September 2005 the Legislature enacted and the Governor signed SB 618 (Speier), 
Chapter 603, Statutes of 2005, that allows three counties to launch a multiagency plan 
to prepare nonviolent felons to be better positioned for a successful transition back into 
the community. San Diego County officials are operating a pilot program. The goal is 
to create a plan for an inmate when he or she is in the county jail so the inmate can 
immediately start with education or vocational programs or life skills classes as soon as 
they enter prison. 

24. Please describe the results of the program to date and the number of 
participants. Are other counties interested in pursuing the same idea, 
and what is the status of those efforts? What efforts are being made to 
expand the program? 

The county initiated program implementation in February 2007. As of May 28, 2008, 
there are a total of 288 active participants, 235 males and 53 females. Of this total, 
23 inmates were in assessment (county jail), 225 inmates were in prison 
(CDCR custody), and 40 offenders in post-release. Of the 225 inmates in prison, 
31 were still in reception center processing. Of the total number of inmates moved to 
the general population (181), 139 of these were in at least one program. 

An implementation barrier has slowed inmate processing. The original program design 
required the county to assume reception center processing; however, this has not been 
possible since the Medical Receiver prohibited the county from assuming this 
responsibility. As a result, offenders must be sent to the reception center for medical 
assessments. CDCR has requested that the new Medical Receiver reconsider this 
action. Removal of this restriction would result in expedited placement of participants 
into the general population, allowing them to enter into programs more quickly. 

The SB 618 Reentry Program includes a research methodology that captures 
programming process and outcomes measures. The San Diego Association 
of Governments, a respected law enforcement research group, is conducting the 
evaluation using CDCR and Independent Review Board guidelines. The evaluation will 
use two control groups along with the experimental group to assess whether process 
and outcome measures have produced the intended increase in program efficiency and 
effectiveness. The impact evaluation will involve follow-up periods of 6, 12, 24 and 
36 months post-release. The first participants exited prison in November 2007. 
Bi-annual research reports will be issued. 

The first process evaluation report was issued in March 2008 based on interviews of 
program partners, i.e. individuals integrally involved in the planning and managing of the 
program as well as key staff. Overall, the findings were positive, with consensus that 



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the program will result in long-term systemic change, including a shift in focus to 
rehabilitation and the provision of wrap-around services. 

In June 2006, CDCR surveyed counties to determine interest in the program. 
Counties interested in participating in the SB 618 County Assessment Program were 
asked to submit a certification form declaring the intent to work in collaboration with the 
various parties outlined in the original statute. While several counties did submit an 
intent form, only Orange County followed up with an official application to participate in 
the program. While the law allows up to three counties to operate the program, CDCR 
had made the decision to implement the program in only one county in order to better 
evaluate the concept before expanding to additional counties. Consequently, at this 
time no formal steps have been taken to expand this project. 

I will ensure that expansion of this program to other counties is considered within the 
current overall reentry planning process. This issue will be revisited with the new 
leadership team. 



Community Partnerships 

The Division of Community Partnerships was established in the July 1, 2005, 
reorganization of CDCR to provide programs and reentry services. It is supposed to 
lead the department into partnerships with other governmental agencies, business 
groups, nonprofits, and advocates for victims. These partnerships are intended to 
create programs for inmates and assist felons to successfully transition back to a 
community upon release from prison. 

25. One of the stated goals of this division was to improve community 
partnerships. How can this be measured? What success have you had? 
How does the division interface with parole in providing services for 
offenders back in the community? 

The DCP has initiated several efforts to improve community partnerships, including 
creating an internal infrastructure to enhance partnerships as well as awarding grants to 
local communities for reentry planning and services. In FY 2007-08, CPMs were funded 
for each institution and secure reentry facilities to increase collaboration efforts. 
Identified performance measures to monitor effectiveness include, but are not limited 
to: increases in offender access and participation in services provided by 
community-based and volunteer organizations; new collaborative agreements; number 
of formal agreements between the prisons and other stakeholders; increases in new 
federal or foundation grant fund awards; and, increases in the number of self-help 
programs offered at each institution. 



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In addition, DCP has created a number of new linkages with community-based and 
faith-based organizations as well as state and local governments. Several of these 
linkages focus on increasing the local community's role and responsibility in the 
successful reintegration of offenders back into their home communities. These efforts 
include: 

a. Community-Based Reentry Initiative & Intergovernmental Partnerships Program: 
These are two grant programs, which have resulted in agreements with 12 local 
government agencies and 8 community-based organizations. The grants are 
designed to foster collaborative planning and programming for offender reentry in 
local communities. 

b. Prisoner Reentry Initiative (PRI): This is a federally funded grant from the 
U.S. Department of Justice to collaborate with four community-based 
organizations to provide reentry services to offenders. The program provides 
linkages between prisons and parole. Seven institutions, Avenal State Prison, 
Folsom State Prison, R.J Donovan, Pleasant Valley State Prison, CIW, 
Valley State Prison for Women (VSPW), and Central California Women's Facility, 
have worked with community organizations in Alameda, Sacramento, San Diego 
and Fresno Counties. The grant focuses on supporting U.S. Department 
of Labor grantees to gain pre-release access for recruitment of offenders and 
provide information to grantees to assist in service identification. 

c. New collaborative partnerships with other governmental entities: This includes 
working with the U.S. Department of Veterans Affairs to coordinate delivery of 
services and resources for incarcerated veterans; participating in the CalTrans 
Clean California Litter Abatement Plan through inmate work crews; and working 
with the Department of Motor Vehicles to provide identification cards to offenders 
who are preparing to parole. 

d. Faith-Based Programs: This includes a faith-based reentry pilot at CIW, which 
consists of a separate living unit on which inmates can volunteer to live; and 
Doing HIS Time Prison Ministries, Inc., who has offered to donate an interfaith 
chapel to be built on the grounds of VSPW. 

Most of the efforts described above require extensive coordination with the Division of 
Adult Parole Operations (DAPO). For example, the grantees must work with regional 
parole staff to develop model referral protocols. In the PRI Program, the involvement of 
the Parole Placement and Planning staff is a critical component of the system design, 
and operational procedures outlining specific roles and responsibilities are in place. 
A major component of SB 618 is the delivery of post-release services; the parole agent 
is a member of the multidisciplinary planning team and participates in weekly joint 
county/state operational meetings. 

There is work that needs to be done with parole as well as others in the provision of 
services for offenders in the community. At present, various CDCR organizational 



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entities purchase services and supports in the community for parolees. DAPO is the 
primary purchaser, although the female offender program similarly makes considerable 
purchases. The Department is considering options to integrate these purchases - as 
noted in the response to question #21. 

In addition, Adult Programs is establishing seven regions, each with a regional 
community program administrator, to begin to establish formal reentry partnerships with 
local communities. As recommended by the Expert Panel, it is critical that CDCR and 
local communities establish formal agreements about roles and responsibilities for 
assisting parolee in reintegrating into their home communities. Regional administrators 
will work closely with each community to complete a full assessment of available 
services and supports (CDCR-purchased, state-funded, or community-based) and 
establish reentry partnership agreements. Adult Programs intends to build upon 
successful local community efforts and formalize the role of CDCR in the reentry 
process. 



Board of Parole Hearings and Division of Adult Parole 

The Board of Parole Hearings (BPH) frequently finds inmates serving indeterminate life 
terms not suitable for parole because the inmates have not received programming 
which the board believes the inmate needs prior to release. 

26. Does the Division of Adult Programs make any effort to track parole 
suitability denials based on unavailability of program or insufficient time 
spent in program? Do you communicate with BPH about the type of 
programs board members believe inmates need to increase parole 
suitability? 

Adult Programs has not previously formally tracked parole suitability denials based on 
unavailability of program or insufficient time spent in program, or communicated with 
board members about programming. Several areas require more work in order to be 
adequately reflected in our case planning and management process and training 
approach. First, I have requested data on parole hearings so that we can get a better 
sense overall of parole suitability denials based on unavailability of program or 
insufficient time spent in program. Second, I have asked to review the program 
overview sheets for each institution that were requested by the undersecretary for the 
Division of Adult Operations, and the proposed program training modules for 
Commissioners. Adult Programs will provide assistance in making sure that these 
two aspects are in place. 

Lastly, I have also met with the special assistant to executive officer at the Board of 
Parole Hearings (BPH) to share information about Adult Programs and the status of 
rehabilitative programming reforms. The BPH has agreed to provide information about 



82 



Senate Rules Committee June 12, 2008 

Carole A. Hood 
Page 29 of 29 



the type of programs board members believe inmates need to increase parole 
suitability. I anticipate using this information to identify additional program needs for 
inmates sentenced to life terms and in developing the training modules for 
Commissioners. 

27. What is your role in creating and monitoring parolee programs? What 
changes, if any, have taken place in parole programs under your 
leadership? 

Adult Programs has not previously been involved in creating and monitoring parolee 
programs; however, I believe that we should be and steps have been taken to move in 
that direction. As noted in the response to question #21, services and supports are 
currently purchased by several organizational entities within CDCR, including parole, 
DARS, and the female offender program. An alternative model is necessary to enable 
purchasing of all services and supports in multiple settings, in prison, reentry facilities, 
and communities, through a comprehensive and uniform statewide approach. A single, 
coordinated approach would allow establishment of services determined through 
offender assessments to be the highest priority. It would also ensure the selection of 
appropriate and effective programs. 

Pending establishment of an alternative model, Adult Programs, parole and the female 
offender program have established a process for review and sign-off on new service 
procurement documents and contracts for services. This interim process has created a 
mechanism to begin to coordinate a statewide, consistent approach to the purchase of 
services. Much more needs to be done and options are under consideration for 
integrating the purchase of programs. 



83 



84 



Senate Rules Questionnaire 
Marko Mlikotin. Cal-Expo Board of Directors 



Statement of Goals 

Q. What are your goals and objectives as a director of Cal-Expo? What do you hope to 
accomplish during your second term? How will you measure your success? 

A. As you know, Cal-Expo receives no funding from the State's general fund. As such, its future 
and financial solvency is dependent on public-private partnerships. Moreover, only with new 
infrastructure and renovations of existing buildings and facilities can Cal-Expo be a profitable 
multi-seasonal entertainment facility. The success of this and future boards will dependent on 
their ability to attract new business, greater investments and sponsorships. 

Sacramento Kings Arena 

Q. What is the status of the joint effort to redevelop Cal Expo? How is the board being kept 
informed of progress? 

A. As chairman of the board and a member of the executive committee, I have been most 
insistent that the board be kept informed of anything of substance. But more importantly, since 
Cal-Expo is a public asset, it is important the public be informed as well. Since the Letter of 
Understanding (LOU) was adopted by the board, I sent a memo (*) to the board explaining the 
general process, and how the board and its respective committees will be involved in considering 
any forthcoming conceptual plan for a mixed use development project, arena plan and 
fairgrounds, all of which will be discussed and considered during meetings open to the public. 

(* see attached memo) 

Horse Racing at Cal Expo 

Q. What role should horse racing play at Cal Expo in the long term? 

A. As acknowledged in the questionnaire, the future of racing in California is very uncertain. 
Cal-Expo's grand stand that once held over 15,000 thoroughbred horse racing spectators, now 
hosts 6,000 on an average, or less. 

Just this year, the Sacramento Harness Association went out of business, saddling creditors with 
over $3.5 million in outstanding obligations, over $1 million of which is owed to Cal-Expo. As a 
result, Cal-Expo will have to defer capital improvements or take other actions to offset this large 
financial loss. Since Cal-Expo is not in a financial position to subsidize the racing industry's 
financial needs, the future of horse racing at Cal-Expo (or any other racing fair) is entirely 

Senate Rules Committee 
JUL 2 6 2008 
Appointments 85 



dependent on the racing industry's ability to compete in a very competitive wagering and 
entertainment industry. 

Q. Do you think horse racing should be included in a joint redevelopment project with the NBA? 

A. As of this date, Cal-Expo awaits a mixed use conceptual plan from the NBA that may or may 
not include the existing horse race track. As detailed in the LOU between the NBA and Cal- 
Expo, the NBA should introduce their conceptual plan before the 180 day negotiation period 
expires. If the NBA's plan does not include a race track in its mixed use plan, I am certain that 
there will be a spirited debate over what is the highest and best use for the race track property, 
and whether the NBA believes that they can finance the construction of a new Kings Arena and 
fair grounds with a race track. 



86 



Memorandum 

Date: June 26, 2008 

To: Board of Directors 

From: Marko Mlikotin, Chair 
Board of Directors 

RE: NBA Proposal — Next Steps 



Please be advised that the following memo contains information concerning some of the 
next steps in the arena discussions with the NBA during the term set forth in the Letter of 
Understanding (LOU). Please also be advised that in the interests of full disclosure, this 
information is also being made available to the public. Because it is for informational 
purposes only and that no action is either required or requested on behalf of the Board, 
please do not respond to this memo or discuss this item with any other board member. 
Please be informed that whenever Board action is either required or is desired, it will be 
done in compliance with applicable open meeting requirements. In the event you receive 
any inquiries concerning this memo or any other topic involving the proposed arena 
transaction, please refer all such inquiries be to the CEO, Norb Bartosik. 

As part of the LOU, the Board approved a 180 day discussion period with the NBA in an 
attempt to develop, evaluate, and mutually agree on a plan for a new Cal Expo, Arena 
and mixed use project. This summary of next steps are being provided to identify for the 
Board the sequence of events that is expected to occur as progress is made towards a 
Definitive Agreement. Please be advised that this information is very preliminary and is 
subject to change as the project takes shape. The following information is generally 
being presented in the order that work is expected to occur, however, some work may 
occur on parallel tracks. 

CONCEPTUAL PLAN 

Staff is currently working with the design team hired by the NBA to develop an overall 
Conceptual Plan that is acceptable to Cal Expo. This plan will include sufficient space 
now and into the foreseeable future to conduct the annual State Fair and facilities which 
add value to the Fair and non Fair programs. Once staff is comfortable with the plan, the 
plan will be presented to the Board's Real Estate Committee, and sub-committees of the 
Executive Committee and Operations Committee. 

Following comments by the Committees, staff will present the Conceptual Plan to the 
public, Cal Expo vendors and business partners for comments. The plan will then be 
presented to the full Board for its review and consideration of approval. The public will 
have another opportunity to make comments before action is taken by the Board. It's 
anticipated that there may also be a level of review by the city of Sacramento. 



87 



Next Steps Memo 
Page 2 



Work during this phase may also include an examination and evaluation of available 
entitlements, cost estimates, governance structure, and various means of financing the 
proposed project and what potential venues and revenue can be drawn from a new 
Cal Expo facility. Entitlements in this case would include approval from the city of 
Sacramento and other regulatory bodies for building permits, infrastructure requirements 
and zoning changes that would be required, etc., for the portion of the property that 
would be developed for private or commercial use. 

Further, in connection with the development of the Conceptual Plan, Cal Expo and the 
NBA will seek appropriate assistanc e from local, state, and federal governments for the 
project's financing, transportation and infrastructure needs. 

ECONOMIC ANALYSIS 

Although it's anticipated that an economic analysis will be done by the NBA on the 
Conceptual Plan, the Board has directed staff to retain consultants for its own economic 
analysis prior to the selection of a developer to evaluate the project with and without an 
Arena. The scope of the economic analysis will be considered by the sub-committee of 
the Executive Committee and the Finance Committee, and approved by the Board. The 
analysis of the plan with an Arena would look at the economic impact on Cal Expo from 
the Arena and mixed use project, and determine the amount of compensation due to Cal 
Expo in the form of rent and capital improvements in exchange for a long term ground 
lease for development. A similar analysis would be done to determine the value of the 
mixed use project without the Arena and look at highest and best use. A copy of the 
economic analysis will be presented to the Board for its review and approval. Staff is 
beginning work on the RFP in the event that there's agreement on the Conceptual Plan. 

REQUEST FOR QUALIFICATIONS/REQUEST FOR PROPOSAL (RFP/RFQ) 

Only upon approval of the Conceptual Plan and supporting economic analysis by the 
Board of Directors, shall Cal Expo and the NBA work cooperatively to submit to 
qualified developers a RFQ/RFP for the development of the proposed project. The 
RFQ/RFP will be approved by the Board before it's released to the development 
community. The process of selecting a developer, which also will require the Board's 
approval, may lead to a vision by the developer of a Conceptual Plan different than the 
plan agreed to by the NBA and Cal Expo. Any changes to the Conceptual Plan will 
require the Board's approval. Moreover, any additional costs associated with evaluating 
the revisions to the Conceptual Plan will need to be paid for by the developer. 



88 



July 11, 2008 JUL 15 2008 

The Honorable Don Perata 

Chairman Senate Rules Committee 

Senate Rules Committee 

State Capitol, Room 420 JUL 1 a onnp 

Sacramento, CA 95814 ~ J 

Dear Senator Perata: 

After my initial 4 year term, I appreciate this request to evaluate and share with you my goals 
for what I hope to be my continued tenure as a board member for the California Exposition and 
State Fair (Cal Expo). 

As we begin each of our meetings, and as I began my first tenure, I restate for you the mission 
statement for Cal Expo: 

"Create a California Experience reflecting the interest and diversity of its people, 
industries, products and trends shaping its future." 

I do this to remind myself that personal agendas have no place on this board, and that if we 
can achieve this mission, we have done our job to set good policies to protect the integrity of 
what, I believe, to be the cornerstone of agricultural education, cultural diversity and future 
industries of the State of California. 

You have also posed four additional questions, which I believe speak to the future of Cal Expo, 
and I wish to address all four together. Because, I believe that the issues you raise are 
intertwined and cannot be viewed individually. With this said, I also wish to state that the 
Board of Cal Expo is dedicated to being transparent, thorough and take our responsibility to 
the people of California, seriously. 

In evaluating the facilities at Cal Expo, it is necessary to determine, status quo and future needs. 

• The staff provides us with all of the appropriate financial information to determine the 
fiscal integrity of our operations on a regular basis. 

• These include detailed budget comparisons with monthly profit and loss summaries; 
balance sheets; cash flow analysis and regular updates of all receivables and payables 
according to the Board approved Policy and Procedures Manual. This information is 
reviewed publicly at our regular monthly meetings. 

• We also look to the staff to provide us with detailed monthly reports on the progress of the 
departmental work of each fair program that is presented for the public to participate in 
annually. 

Cal Expo intends to race a mixed breed/thoroughbred meet for the first time after a three year 
absence during the 2008 State Fair. The success of the race meet will present many answers to 
the future of racing for Cal Expo; however the racing industry needs to support this and any 
significant efforts to continue racing in Sacramento. 



89 



The Honorable Don Perata 
July 11, 2008 
Page 2 

Currently, the industry focus is on Pleasanton and the Bay Area tracks. Funding is a significant 
factor for the future of all racing not only at Cal Expo, but all racing fairs. 

Cal Expo is in the racing business and can remain there if the racing industry supports plans for 
a committed investment for extended race meets at our facility. Without the support of the 
racing industry the economics to invest $15 to $20 million dollars, show little or no return for the 
investment. 

The State Fair competes with other fairs both regionally and internationally to showcase their 
work and is honored annually by their trade associations with numerous awards of excellence. 
We have the ability to showcase an incredible event that each year highlights the Best of 
California in an entertaining and educational exposition. 

What we lack is the ability to continue to maintain and make progress with an aging 
infrastructure and a growing list of major and deferred maintenance projects that now exceed 
$40 million dollars collectively. 

Therefore, this board has endeavored to investigate new options which have been brought to us 
by the National Basketball Association (NBA). Attached is the most current memo (attachment 
A) dated June 26, 2008 distributed to the public and to the board from Chair Mlikotin and the real 
estate committee. Each step is also to be transparent and open to comments from the people of 
California. Each step is and will be evaluated. 

The expertise on this board, the highly capable staff of Cal Expo, the diversity of the Bingham 
Consulting Group, and of the people of California, insure that we ask the correct questions and 
request all the information necessary to insure the future of Cal Expo. This is our "due diligence" 
and we will take the time to complete our task. 

I appreciate this opportunity to provide you with this information, and hope that you feel the 
future of "Big Fun" is secure in our hands. 

Sincerely, 
Kathleen K. Nakase 





Enclosures 
Attachment A 
Form 700 



90 



Attachment A 



Memorandum 

Date: June 26, 2008 

To: Board of Directors 

From: Marko Mlikotin, Chair 
Board of Directors 

RE: NBA Proposal— Next Steps 



Please be advised that the following memo contains information concerning some of the 
next steps in the arena discussions with the NBA during the term set forth in the Letter of 
Understanding (LOU). Please also be advised that in the interests of full disclosure, this 
information is also being made available to the public. Because it is for informational 
purposes only and that no action is either required or requested on behalf of the Board, 
please do not respond to this memo or discuss this item with any other board member. 
Please be informed that whenever Board action is either required or is desired, it will be 
done in compliance with applicable open meeting requirements. In the event you receive 
any inquiries concerning this memo or any other topic involving the proposed arena 
transaction, please refer all such inquiries be to the CEO, Norb Bartosik. 

As part of the LOU, the Board approved a 180 day discussion period with the NBA in an 
attempt to develop, evaluate, and mutually agree on a plan for a new Cal Expo, Arena 
and mixed use project. This summary of next steps are being provided to identify for the 
Board the sequence of events that is expected to occur as progress is made towards a 
Definitive Agreement. Please be advised that this information is very preliminary and is 
subject to change as the project takes shape. The following information is generally 
being presented in the order that work is expected to occur, however, some work may 
occur on parallel tracks. 

CONCEPTUAL PLAN 

Staff is currently working with the design team hired by the NBA to develop an overall 
Conceptual Plan that is acceptable to Cal Expo. This plan will include sufficient space 
now and into the foreseeable future to conduct the annual State Fair and facilities which 
add value to the Fair and non Fair programs. Once staff is comfortable with the plan, the 
plan will be presented to the Board's Real Estate Committee, and sub-committees of the 
Executive Committee and Operations Committee. 

Following comments by the Committees, staff will present the Conceptual Plan to the 
public, Cal Expo vendors and business partners for comments. The plan will then be 
presented to the full Board for its review and consideration of approval. The public will 
have another opportunity to make comments before action is taken by the Board. It's 
anticipated that there may also be a level of review by the city of Sacramento. 



91 



Next Steps Memo 
Page 2 



Work during this phase may also include an examination and evaluation of available 
entitlements, cost estimates, governance structure, and various means of financing the 
proposed project and what potential venues and revenue can be drawn from a new 
Cal Expo facility. Entitlements in this case would include approval from the city of 
Sacramento and other regulatory bodies for building permits, infrastructure requirements 
and zoning changes that would be required, etc., for the portion of the property that 
would be developed for private or commercial use. 

Further, in connection with the development of the Conceptual Plan, Cal Expo and the 
NBA will seek appropriate assistance from local, state, and federal governments for the 
project's financing, transportation and infrastructure needs. 

ECONOMIC ANALYSIS 

Although it's anticipated that an economic analysis will be done by the NBA on the 
Conceptual Plan, the Board has directed staff to retain consultants for its own economic 
analysis prior to the selection of a developer to evaluate the project with and without an 
Arena. The scope of the economic analysis will be considered by the sub-committee of 
the Executive Committee and the Finance Committee, and approved by the Board. The 
analysis of the plan with an Arena would look at the economic impact on Cal Expo from 
the Arena and mixed use project, and determine the amount of compensation due to Cal 
Expo in the form of rent and capital improvements in exchange for a long term ground 
lease for development. A similar analysis would be done to determine the value of the 
mixed use project without the Arena and look at highest and best use. A copy of the 
economic analysis will be presented to the Board for its review and approval. Staff is 
beginning work on the RFP in the event that there's agreement on the Conceptual Plan. 

REQUEST FOR QUALIFICATIONS/REQUEST FOR PROPOSAL (RFP/RFQ) 

Only upon approval of the Conceptual Plan and supporting economic analysis by the 
Board of Directors, shall Cal Expo and the NBA work cooperatively to submit to 
qualified developers a RFQ/RFP for the development of the proposed project. The 
RFQ/RFP will be approved by the Board before it's released to the development 
community. The process of selecting a developer, which also will require the Board's 
approval, may lead to a vision by the developer of a Conceptual Plan different than the 
plan agreed to by the NBA and Cal Expo. Any changes to the Conceptual Plan will 
require the Board's approval. Moreover, any additional costs associated with evaluating 
the revisions to the Conceptual Plan will need to be paid for by the developer. 



92 



Next Steps Memo 
Page 3 



DEFINITIVE AGREEMENT 

If during the discussion period, Cal Expo and the NBA each independently reach a 
determination that the proposed project is in each party's best interest, then both parties 
will work towards entering into a Definitive Agreement. The agreement would include, 
but not be limited to, such terms and conditions as Definition of the Premises, 
Governance, Sponsorships, Term, Compensation, Payment Schedule, Operating 
Guidelines, Entitlements, Non-Compete Clauses, Parking, Utilities, Insurance, Change in 
Ownership, Termination, Indemnification, Dispute Resolution, etc. The Definitive 
Agreement will require the approval of the Board and the Department of General 
Services. 

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) 

CEQA applies to the Arena Project. In order to comply with the requirements of CEQA, 
an Environmental Impact Report (EIR) will need to be prepared, circulated for public 
review, and approved by the Board. 

Cal Expo will be the lead agency in the CEQA process. The lead agency is the public 
agency that has the primary responsibility for approving the project that may have a 
significant impact on the environment. Generally, the developer of the project would be 
required to reimburse the public agency (in this case, Cal Expo) for the cost of preparing 
the EIR. 

In general, the CEQA process works as follows: 

Consultants hired by Cal Expo would prepare an Initial Study which serves as a 
preliminary tool to identify potential environmental effects. A Notice of Preparation is 
sent to other public agencies so that these public agencies can describe the scope and 
content of the environmental information they expect to see included in the Draft EIR. 
The EIR is drafted and made available for a public review period. Public comments are 
received, evaluated and responded to. Consideration and approval of the final EIR is 
given by the Board. The Board, in approving the final EIR, adopts findings that in the 
Board's opinion, reduces, mitigates, or avoids significant environmental impacts of the 
proposed project. The Board is then free to approve the project. A Final Notice of 
Determination is filed with the state Office of Planning and Research. Work cannot start 
on the project until the period of time for the public to challenge the findings in court has 
passed. 



93 



Next Steps Memo 
Page 4 



ESTIMATED COSTS 

Other than retaining the Bingham Consulting Group and the investment of considerable 
staff time, Cal Expo has not committed substantial financial resources in the discussions 
leading up to the development and evaluation of the Conceptual Plan for the project. 
Nevertheless, if the parties do agree on the fundamental requirements of the Conceptual 
Plan and the Board approves the Conceptual Plan, it will be necessary for Cal Expo to 
commit substantial financial and other resources in proceeding with the remainder of the 
Arena Project evaluation process. At a future Board meeting, either as a separate agenda 
item or in conjunction with the decision to either approve or disapprove the Conceptual 
Plan, the Board will need to consider the issues involving the expenditures necessary to 
properly evaluate the Arena Project and to what extent, if any, these expenditures may be 
reimbursable. 

At the Board's May 21, 2008 meeting, John Moag stated that the RFQ/RFP to select a 
developer for the project should require that the winning developer be required to 
reimburse Cal Expo for its costs leading to a Definitive Agreement. We are proceeding 
at this time with this understanding in mind. 

However, in the event that Cal Expo is unable to come to an agreement with the NBA 
and/or the developer, we should be mindful that Cal Expo will bear the burden of its own 
expenses. It is the cost that may be necessary in order for Cal Expo to satisfy it's 
independent duty of due diligence in evaluating the cost/benefit analysis of proceeding 
with the proposed Arena Project. 



94 



Responses 
For the Senate Rules Committee 

Statement of Goals 

Q: 1. what are your goals and objectives as a director of Cal Expo? 
As a director of Cal Expo my goals and objectives are to be the liaison of 
our community but emphasis on the Latino Community and our agency. 
Be one of the individuals that can help grow the revenue of the agency 
and the image of who and what we are through networking an 
showcasing our marketable space and the easiness and convenient usage 
of our property for their needs. In comparison to other venues 
During the summer and the California Exposition and State Fair be able 
to move visitors' to our grounds and educate them on what our state has 
to offer. Our state is made up of a very diverse group of people. By 
showcasing their contribution and uniqueness everyone will learn. 
Because of our agricultural elements it behooves us to lead in education 
in a BIG fun and hands on environment. Since we are an agricultural 
state it is important to showcase, especially to our youth, what we grow. 
(And that milk and vegetables do not just come from the refrigerator) 

Sacramento Kings Arena 

Q: 2. what is the status of the joint effort to redevelop Cal Expo? How is 

the Board being kept informed of the progress? 

A: Background: 

The Board of Directors meet regularly (monthly) in a public forum to 
carry out its agendized business; and, the subject of the NBA Arena was 
brought forward under New Business at the meeting held on September 
28, 2007. 

At this meeting, a request was made by Moag & Company to open 
negotiations with Cal Expo on providing for a new NBA Arena and 
further development of the property, etc. 

After a public presentation by Mr. Moag, the board entertained public 
comments; comments from various Board members and ex-officio 
member Assembly member Dave Jones. 

Senate Rules Committee 

JUL 2 4 2008 
Appointments 



95 



At this point in time, a motion was put forward to have the Board of 
Directors authorize the "Real Estate Committee" (a sub-committee of 
the Board) and "staff to enter into discussions with the NBA 
concerning a proposal to construct a new arena and for the 
redevelopment of Cal Expo facilities. Motion carried unanimously. 

Next, a motion was put forward for the Board to authorize the Executive 
Committee of the Board to contract with any necessary consultants 
should parties desire to move forward with negotiating an agreement. 
The process established by this action requires the Real Estate and 
Executive Committees to provide periodic status updates to the Board, 
and if appropriate, submit to the board for consideration of approval an 
Agreement between the NBA and Cal Expo. Motion carried unanimously. 

As noted, an L.O.U was signed to explore this joint development. The 
current status is that Cal Expo management is meeting with the design 
team assembled by the NBA to bring back a concept master-plan for the 
Real Estate Committee to review and then present to the Executive 
Committee; and, if it meets their approval then the full Board of Directors 
will review this concept at a public meeting. 

To respond to the second part of the question, there has been no progress 
report made to the Board of Directors to date. It is generally understood 
that both parties are in the process of providing additional background 
information and that "due diligence" is in progress for each party to bring 
further information to the other for discussion. The design team has 
visited the San Diego County Fair and has plans to visit the California 
State Fair. After this visit, the teams will present to the Board Committees 
as noted above, to move this project. 

Horse Racing At Cal Expo 

Q: 3. what role should horse racing play at Cal Expo in the long term? 

Cal Expo has the facilities to conduct horse racing in the future. If 
extended racing meets are part of the future of this track, then several 
significant upgrades will be required to operate in a fashion as deemed 
acceptable to the California Horse Racing Board; and, to meet future 
water quality standards for storm run-off. 



96 



Simply put, Cal Expo is in the racing business and can remain there if the 
racing industry supports plans for a committed investment for extended 
race meets at our facility . 

Without the support of the racing industry the economics to invest $15 to 
$20 million dollars, show little or no return for the investment. 

4. Do you think horse racing should be included in a joint redevelopment 
project with the NBA? 

Cal Expo intends to race a mixed breed/thoroughbred meet for the first 
time after a three year absence during the 2008 State Fair. The success of 
the race meet will present many answers to the future of racing for Cal 
Expo; however the racing industry needs to support this and any 
significant efforts to continue racing in Sacramento. Currently, the focus is 
on Pleasanton and the Bay Area tracks. Funding is a significant factor for 
the future of all racing not only at Cal Expo, but all racing fairs. 

State Fair 

Q: 5. how do you evaluate the success of the State Fair? Do you have the 

tools you need for this evaluation? 

These complex questions can be answered in a multitude of responses. 
One, the staff provides us with all of the appropriate financial information 
to determine the fiscal integrity of our operations on a regular basis. These 
include detailed budget comparisons with monthly profit and loss 
summaries; balance sheets; cash flow analysis and regular updates of all 
receivables and payables according to the Board approved Policy and 
Procedures Manual. This information is reviewed publicly at our regular 
monthly meetings. 

Second, we also look to the staff to provide us with detailed monthly 
reports on the progress of the departmental work of each fair program that 
is presented for the public to participate in annually. 

The State Fair competes with other fairs both regionally and 
internationally to showcase their work and is honored annually by their 
trade associations with numerous awards of excellence. Therefore, from a 
practical standpoint we have these tools to help us. 



97 



We have the ability to showcase an incredible event that each year 

highlights the Best of California in an entertaining and educational 

exposition. 

What we lack is the ability to continue to maintain and make progress 

with an aging infrastructure and a growing list of major and deferred 

maintenance projects that now exceed $40 million dollars collectively. 



98 




Special Assistant to the Chancellor, The California State University 



California State University 

SAN MARCOS 



California State University San Marcos 



Senate Rules Committee 

MAY 3 2000 



San Marcos. California 92096-0001 USA 
Tel: 760-750-4100 Fax: 760-750-4033 



May 27, 2008 

Senator Don Perata 

Chairman, Senate Rules Committee 

c/o Nettie Sabelhans 

Appointments Director 

Senate Rules Committee, Room 420 

Sacramento, CA 95814-4900 

Dear Senator Perata: 

This is in response to your letter of 5 May 2008. Please let me know if you need any 
additional information from me about the important work of the California Student Aid 
Commission: 

1. Brief statement of my goals as a new member of the California Student Aid 
Commission: 

As a longtime advocate for insuring that all Calif ornians have the right and the 
opportunity to earn a college degree, I look forward to serving on the California 
Student Aid Commission. Making a college education financially possible to all 
Califomians, which is the basic mission of CSAC, needs to be a top priority concern 
of all Califomians. 

I am hopeful that my background and experience will prove to be beneficial to the 
work of the Commission. Fostering educational access and insuring that a college 
education is affordable for every Californian I consider to be one of the highest 
priority concerns that we face today in California and in American society as a 
whole. 

2. Brief assessment of the challenges that face California's student aid systems and 
what recommendations do I have to improve the systems: 

Although I do not have a full and complete picture of the total situation, my initial 
assessment is that insuring student and institutional access to the Cal Grant Delivery 
Systems that we have must be maintained and assured: 

• A top priority concern, in this regard, is that although the Legislature provided 
the funding support and authority last year to improve the information 
technology portions of the Grant Delivery System so students could submit and 

The California Stale University 

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99 



obtain the grant information they needed, budget reductions this year have 
seriously impacted the ability of C5AC to follow through and maintain the new 
improved systems. To make matters worse the difficulties surrounding the sale 
of EdFund have compounded the problem because of the uncertainties 
surrounding the work schedules of key EdFund staff. 

• Commission grant programs that allow students and institutions to update and 
access information easily and in timely fashion need to be strongly supported 
and given a high priority. 

• The Commission recently implemented an Integrated Voice Response system 
(IVB) to its call center that allows callers to access information regarding Cal 
Grants and other financial aid programs. This important positive effort needs to 
be maintained and strongly supported. 

Other challenges that the Commission faces involve outreach efforts: 

• A top priority concern is the lack of funds for its outreach activities. In the past, 
the Commission was able to use funds from its Student Loan Operating Fund — 
that is, funds generated by Commission activities in the operation of the Federal 
Family Education Loan Program. With those funds the Commission was able to 
develop and implement a comprehensive public information and outreach 
campaign. In a related effort, it was also able to implement its California Cash 
for College Program. ..a partnership effort with regional partners and hundreds 
of schools, colleges, universities and county organizations who joined in an effort 
to assist low income first generation college goers to successfully apply and 
receive state and federal financial aid. That was terminated with the ehmination 
of the Student Loan Operating Fund as a funding source. 

• In 2007, the Commission was authorized under AB1540 to accept contributions — 
cash and in-kind — to underwrite its California Cash for College program. The 
challenge it faces involves how to implement this new AB1540 effort and also 
continue to expand its California Cash for College program. 

And lastly I would note the following as additional matters of operational concern 
which CSAC faces: 

• The need to streamline and simplify the Free Application for Federal Student Aid 
(FAFSA) program. This will require working with the U.S. Department of 
Education to effect the changes needed. 

• Linking Cal Grant and other special purpose loan programs (APLE, SNAPLE, 
etc.) to the FAFSA website. CSAC staff are working with Ed. Dept. staff to 
address this. 

• Continuing efforts to enhance the Commission's web tools to better serve 
students — to streamline the grant delivery process. One excellent example is by 
moving to an electronic submittal of student grade point average information. 



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A majority of Commission members of CSAC have served for less tha n two years. What is the 
Commission doirm to inform and educate new members r egarding items which come before the 
Commission and, in general, issues affecting st udent financial aid? 

Insuring that new Commissioners are well informed and provided with the information 
they need to function effectively in their roles as Commissioners is a top priority concern of 
the Director and her staff. The Commission has an extensive set of base policies in place 
that are designed to provide all Commissioners (and especially new ones such as myself) 
with the basic background and in depth policy analysis of the issues before the Board. 

New Commissioners are provided with detailed CSAC background, governance policy 
process information as well as extensive strategic planning and assessment information 
about the specifics of the issues before the Commission. In short, the Commission has 
adopted appropriate basic policies that guide all of its governance, strategic planning, and 
basic administrative operations. 

Should the Commission pe advocating for a statewide fee policy? If so. what are the 
elements of such a policy? 

No. The Commission does not advocate for bills beyond those related to financial 
aid which I agree is appropriate. 

Is the Commission informing itself about the rising costs of attending college in 
California, especially the growth of non-fee related expenses? If so. can the 
Commission act to address non-fee related expenses? How? 

Yes, the Commission is informing itself about the high cost of attending college. 
Specifically the Commission, in collaboration with all five segments of higher 
education, administers the Student Expense and Resources Survey (SEARS) 
triannually to gather data on the actual expenses and financial status of California 
college students. It is administered to approximately 70,000 college students 
attending California community colleges, the University of California, the California 
State University or one of the state's independent or private colleges. 

Prior to administering the survey the SEARS advisory committee meets to evaluate 
whether the questionnaire has appropriately accommodated the changing needs of 
all current students. Data from SEARS are used to produce expense budget 
information which provides the basic student budget baseline information; i.e. room 
and board, transportation, books and supplies, course material fees, computer 
related expenses, etc. When the review shows that students have additional 
expenses those are incorporated into the SEARS data baseline used. 

Commission staff are currently reviewing the SEARS process and the assessment 
information gathered to determine its continued viability and to make any upgrades 

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and improvements needed in the SEARS process. 

6. How does the Commission determine the student allowance for book, supplies, and 
other living expenses associated with attending college, and does the allowance take 
into account the different costs of living in various parts of the state? 

The Commission determines the student cost for books, supplies and other living 
expenses associated with attending college by data from their triannual SEARS 
survey to calculate the average Nine-Month Student Budgets for students living on- 
campus, those living off -campus and those living with parents. 

In non-survey years, the Nine-Months Student Expense Budget information is 
adjusted using the California Price Indices proposed by the Department of Finance. 

However, it is important to note that colleges are not required to use the Nine- 
Month Student Expense Budget baseline established by the Commission. Instead, 
colleges are permitted to submit their own campus specific budget requests each 
year if they determine that those more accurately reflect the actual student expenses 
in their geographic area. 

7. As the credit crun c ji pushes lenders to stop issuing loans, does CSAC have an 
advocacy role to ensure that federally guaranteed student loans will be available to 
students and their families for the fall 2003 semester? 

Yes, within the following framework: 

A. Federal law guarantees the availability of a Federal Family Education Loan 
(FFEL) to eligible students. A student, who is otherwise eligible for a Stafford 
Loan and who after receiving two rejections, has been unable to find a FFEL 
lender willing to make such a loan is eligible for a guaranteed student loan 
issued under the lender-of-last-resort (LLR) program. 

B. Every state student loan guaranty agency, such as the Commission, must either 
designate an eligible lender to serve as an LLR or must itself serve in that 
capacity. The guaranty agency must develop policies and operating procedures 
for its LLR program that provide for the accessibility of LLR loans. 

C. The Commission, through its auxiliary, EdFund, has an LLR program in place. 

D. In response to the credit crunch, the United States Department of Education has 
asked all state student loan guarantee agencies to provide an updated and 
complete statement of their LLR policies and procedures by May 16, 2008. 

E. The first choice for an LLR process is to secure lenders who are willing to serve 
as lenders of last resort. Because guarantee agencies have very limited capacity 
to use their own funds in making LLR loans, they will need to rely on federal 
advance funds if lenders are unwilling to participate as lenders of last resort. If 
a guarantee agency advises the Secretary that it has been unable to find a 
lender or lenders to act in the lender of last resort capacity, the Secretary will 



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make federal advances available to the guarantee agency consistent with its 
authority, in order to make such loans. 

F. The Commission, in conjunction with its auxiliary, EdFund, is complying with 
all directives related to the LLR program issued by the United States 
Department of Education. 

G. The Governor's May Revision has indicated that legislation is necessary to 
remove potential statutory conflict that may affect the Commission's ability to 
act as a LLR in response to the crisis in the student lending markets. The 
Governor proposes that this legislation should be part of a "trailer bill", i.e,, 
bills proposing statutory changes that accompany the actual budget bill. 

H. To enable the Commission to fulfill its LLR obligations, I am confident that the 
Commission would support the Governor's proposal for legislation to remove 
the potential statutory conflict, 

8. What are the Commission's plans if banks continue to drop out of t he federal 
program? Has the Commission been engaging colleges and univers ities in this 
issue? 

The Commission's basic strategy and plans, if banks continue to drop out of the 
federal program, are pretty well outlined in the previous response to question seven. 
Federal law requires the state designate an eligible lender to serve as an LLR 
(Lender of Last Resort) or must itself serve in that capacity. As noted previously 
CSAC has done so — it has a Lender of Last Resort (LLR) program in place through 
its auxiliary, EdFund. 

It is important to note also that the Commission, through its auxiliary, EdFund, sent 
letters to all California institutions in April assuring them that CSAC is committed to 
continuing to provide quality services to all California colleges and their students. 
And that CSAC remains committed to helping all eligible borrowers secure the loans 
they need to attend the college or university of their choice. 

9. Through its financial aid outreach programs, is the Commission able to provide 
student borrowers with substantive information and loan counseling before they 
enter into private loan agreements? If so. please describe. 

Yes, the Commission does indeed provide student borrowers with substantive 
information and loan counseling before the students enter into loan agreements. 
They do so through their outreach work with EdFund its auxiliary. The publication 
produced jointly by the Commission and EdFund entitled "Fund Your Future" is the 
publication most used by California students to learn about all available financial 
aid programs, their requirements, and how they can apply for State as well as 
federal financial aid programs — including applications for the possible private loans 
they may apply for. 



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10. What is the Commission doing to encourage community college stude nts to take full 
advantage of financial aid resources available to them? Should other step s be taken? 

A. CSAC is doing a great deal. In 2006-07, thirty five percent of the 64,114 Cal 
Grant Entitlement Awards made in California were offered to students 
attending California Community Colleges. 

B. And also in 2006-07, 73% of the Cal Grant Competitive Awards were offered to 
California community college students. The success of these efforts is the result 
of the important joint partnering efforts between the community colleges and 
the CSAC. The "I Can Afford College" campaign is probably the most highly 
regarded outreach effort in that regard. 

C In summary, the Commission has very directly reached out to community 
colleges students. These targeted activities include: 

• A specific Cal Grant messaging outreach effort sent to all community 
college students emphasizing the Sept. 2 deadline for the Cal Grant 
applications. This direct messaging application is annually reviewed and 
approved by the California Community College Chancellor's Office. 

• Preparation and dissemination of a year round messaging poster targeting 
community college students which provides information about the "I Can 
Afford College" campaign. 

• Advertising through public transit systems which specifically target low- 
income at risk student populations. These are year round efforts. 

• Each year, through its California Cash for College workshops, CSAC 
contacts all students who attended workshops but who did not complete 
the Cal Grant application process. These students are urged to contact a 
California community college in their area and to visit the "I Can Afford 
College" website. 

• CSAC staff participate in community college foster youth program events to 
provide Cal Grant and Chafee Program information to eligible foster youth. 

D. Beyond the activities noted I do not know of any additional actions that CSAC 
could take. Their efforts in this area are impressive. 

11. What is the Commission doing to influence the development of federal. financial aid 
policies under review in Congress that have a direct impact on California students? 

While the Commission does not have a Washington, DC office, it has, in the past, 
sought to influence the development of federal financial aid policies by doing the 
following: 

A. Worked with the Administration, through the Office of the Secretary of 
Education and, at times, the Department of Finance, to identify significant 



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federal financial aid issues affecting both grants and loans and to provide 
information to federal agencies and to the Congress. 

B. After informing the Administration/ to insure that there would be no objection, 
CSAC testified at a Congressional hearing held in California regarding higher 
education financial aid issues. 

C. Provided information to the Legislature, on financial aid policies the 
Commission considered significant, to enable the Legislature to advocate on 
California's behalf when Legislative members go to Washington, DC on their 
annual visit. 

D. The Commission has authorized its auxiliary organization, EdFund, to monitor 
federal issues relating to the loan program. And Commission staff, through its 
Federal Policy and Programs Division, also keeps track of federal loan program 
issues and coordinates with EdFund staff to ensure California interests are 
being addressed by the United States Department of Education. 

12. How does the Commission prioritize its outreach activities to reach the lowest 
income students in the state? How does the Commission reach out to non-Eng lish 
speaking communities? 

A. Over the past three years, the Commission has worked closely with the UC 
ACCORD research center to develop a weighted methodology to target 
Commission outreach efforts, including media buys, direct mail, outreach 
tutorial and financial aid workshop offerings. 

B. The methodology uses factors to identify high schools in areas with high 
percentages of low-income students as well as other key factors of student need 
that can improve student access to education beyond high school. These 
include: 

• The most heavily weighted factor which is family income. 

• Additional factors which include; concentration of poverty in the student's 

high school area, parent educational level, and 9chool factors such as high- 
school-counselor-to-student ratios, high school graduation rates, a school's 
Cal Grant application rate, and the school's Cal Grant student aid GFA 
submission method- 

C. Large, medium, and small schools are included in the overall list of more than 
300 schools. 

D. In addition, the Commission also administers the Student Opportunity and 
Access Program (Cal-SOAP), which by statute, requires that Cal-SOAP projects 
be designed "to increase the accessibility of postsecondary educational 
opportunities for any of the following elementary and secondary school 
students: (1) Students who are from low-income families. (2) Students who 
would be the first in their families to attend college. (3) Students who are from 



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schools or geographic regions with documented low-eligibility or college 
participation rate9." (Education Code section 69561(b).) 

E. The Commission currently funds 15 Cal-SOAP projects or consortia throughout 
the state. 

F. The Commission reaches out to non-English speaking communities through 
various approaches — through print, TV partnerships, radio and local 
grassroots outreach, etc. 

G. The Commission's student-friendly website, www.calgrants.org is available in 
Spanish. Students and families learn about the application process, the Cal 
Grant and other financial aid programs, and where to find a California Cash for 
College workshop nearest to them. In addition, the CSAC program Fund Your 
Future has developed student aid materials in Spanish, Vietnamese, Chinese, 
Korean, Hmong, Tagalog, Russian, and Armenian. 

H. In past years, the CSAC Cal Grant public awareness campaign aired radio and 
cable TV ads in Spanish for the duration of the two month campaign leading 
up to the Cal Grant deadline. In 2008, the campaign's efforts generated 155 
placements in Spanish-language outlets, including 40 broadcast and 70 print 
stories. Additional ethnic coverage included news stories in other ethnic daily 
newspapers in the major Los Angeles and San Diego markets. 

I. And over the past three years, the Commission has partnered with Univision 
34's successful A Su Lado program and the California Cash For College 
program to offer a six-hour evening telethon to reach families in the greater Los 
Angeles area who would otherwise not have learned about the availability of 
student financial aid. Each year, approximately 2,500 students and their 
families are provided direct face to face assistance in this one event and are 
directed to a California Cash For College workshop for personalized assistance 
with the financial aid application process. 

J. California Cash For College workshops provide multi-lingual, line-by-line 
assistance workshops which are offered in ninety percent of California 
counties. 

K. In 2008, California Cash For College workshop presentations were made 

available in Spanish, Vietnamese, Hmong, Chinese, Korean, and Tagalog. Each 
workshop provided specific language assistance to meet the needs of the local 
communities. In 2008, 35 percent of students responding to an exit survey at the 
workshops identified Spanish as their primary home language. Another 9 
percent indicated other primary languages were spoken at home. 

L. For students who do not quality for state or federal financial aid, California 
Cash For College workshops offer additional information, or separate 
workshop sessions, to assist potentially eligible AB 540 students and their 
parents learn about tuition costs and scholarships. AB 540 added Education 
Code section 68130.5 which can assist undocumented students to qualify for in- 
state tuition scholarship support at California Community Colleges and 
California State University institutions if they meet certain requirements. 

M. Through the California Cash For College program the Commission in 

collaboration with local schools reaches out though diverse media outlets to 



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non-English speaking communities. Specifically through talk shows 
(Vietnamese media) and press conferences also specifically targeting Asian 
language media. 

N. Most Cal-SOAP projects employ bi-lingual staff or use local volunteers from 
the member institutions, who speak the predominant non-English language of 
the region. They develop bi-lingual materials and provide community 
workshops and parent counseling in Spanish and other languages. 

O. The Commission administers the federal Gaining Early Awareness 

Scholarshare Trust (GEAR UP) awards in partnership with the California 
Department of Education. Cal Grant and other financial aid information is 
provided to low-income middle school students to prepare them for higher 
education. The Commission continues to communicate with these students up 
to their enrollment in college and during their first year in college. 

P. The Commission administers the California Chafee Foster Youth Program for 
the California Department of Social Services. Staff participate in various foster 
youth events where they present information on the Chafee Program as well as 
the Cal Grant college assistant program. Compared to all other students, this 
population of students has more financial need and the lowest income levels. 

13. Are vou satisfied with how the Commission helps families complete the Free Atrplication for Federal 
Aid to increase access ft p fi nancial aid? Should more be done? 

Although it is certainly possible that CSAC could find additional ways to help families complete the 
Free Application for Federal Aid in order to increase their access to financial aid, what the 
Commission is doing is very positive and appropriate. The following CSAC programs and activities 
are the principal reasons why I believe that to be the case: 

A. The California Cash For College program which is specifically designed to assist low-income 
and first-generation college-bound students and their families successfully apply for state and 
federal financial aid. 

B. In a related effort, over the past three years, the California Cash For College program 
has, through its partnership with the College Access Foundation of California, offered 
incentive scholarships which encourage students to attend a workshop and to apply for 
a Cal Grant by the March 2 deadline. Each year, more than half of the students who 
returned their evaluations, and 64 percent of respondents this year, said this scholarship 
program made a positive difference in their attendance at the workshop and their 
decisions to apply. 

C. Cal-SOAP consortia also participate in the California Cash For College program which 
includes services to parents, financial aid workshops, loan counseling, and college 
admissions workshops. 

14. What is t he Commission doing to develop outreach urograms that increase participation in the Cal 
Grant community college transfer entitlement program? 

A. In 2006-07, 43S6 California Community College Transfer Cal Grant Entitlement Awards were 
offered. Preliminary awards to 8,810 students were offered. Of those students offered 

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preliminary awards, 72% or 6730 returned the forms required to certify graduation from high 
school, residency, and other information. Of those 6730, 3344 did not qualify for the final 
award, but 4386 students were offered Cal Grant awards. 
B. Cal-SOAP also supports and promotes all levels of educational attainment beyond high school, 
including, career technical programs to community college and to four year universities. Many 
Cal-SOAP consortia offer mentoring and informational services to community college transfer 
students and transfer entitlement grants. Often these consortia work with local community 
college transfer offices in providing these services. 

1 5. Briefly describe anv outstanding transitional issues related to the sale of EdFund and how the 
Commission is addressing these issues. 

In preparation for the sale of EdFund and EdFund's move to new facilities, Commission staff took 
the following actions to mitigate the impact on Cal Grant services to students, staff, and schools: 

A. The Grant Delivery System was moved to the state data center for hosting. CSAC continued to 
provide basic in-house system maintenance and support. 

B. The microwave network link to the Commission's Headquarters (HQ) building has been 
moved from the EdFund building to the Commission's South building. This insures network 
connectivity for the HQ building after EdFund moves to Mather Field in July. 

C. Replacement phone systems have been ordered and will be installed in June. 

D. The Interactive Voice Response system will be moved to the Data Center by the end of May. 

E. The existing security badge system is being moved from EdFund to the Commission in June. 

With the announced postponement of the sale of EdFund until fiscal year 2009-1 0, many of the 
remaining transition issues have been postponed along with the sale, such as the establishment of the 
business and technology services within the Commission which are currently provided by EdFund. 
These functions will require additional resources, including staff and equipment. The Commission 
staff will submit a 2009-10 Budget Change Proposal to request the required additional resources. 

The Commission will also consider the approval of an amendment to the Operating Agreement 
between the Commission and EdFund to extend the agreement through June 30, 2009. This 
extension will allow for the continued level of service EdFund currently provides to the Commission 
through the next fiscal year. 

The proposed 10 percent budget reduction for 2008-09, the proposed sale of EdFund and the 
elimination of associated oivil services positions, forced Commission management to submit layoff 
plans to the Department of Personnel Administration (DPA). The following arc the specific actions 
the Commission has taken: 

A. With DPA's approval of the layoff plans, Commission employees with the lowest seniority in 
the affected classifications were notified that their employment with the Commission was in 
jeopardy. These employees were placed on a list that provides them enhanced interviewing 
rights with other state agencies that are hiring new staff. The affected employees include 
Commission civil service employees assigned to the Commission and to EdFund. 

B. Many of the Commission's more recently hired employees, who were hired due to their 
knowledge and skills in financial aid, have been hired away by other agencies. The loss of 

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these talented employees will affect the Commission's service to students and schools. 
However, Commission management has begun taking steps to mitigate any reduction in 
services. 
C. The postponement of the sale should allow civi) services employees assigned to EdFund to 
retain their positions within EdFund, and should provide some relief to the layoff situation. 

The Commission is scheduled to move to a new facility in 2008-09. Unfortunately, the approval to 
move was received late resulting in the Commission having to move twice. Most of the Commission 
staff will move back to the South building prior to August, when the HQ building lease expires. 
However, the South building cannot accommodate all Commission staff, so the Commission has 
asked the Department of General Services to pursue a sublease with the new tenants in the HQ 
building for the space it needs for the remaining Commission staff. The new tenant has indicated a 
willingness to sublease to the Commission. In addition: 

A. Commission staff has identified two new sites within 1. .5 miles of its current location and has 
asked the Department of General Services to begin lease discussions with representatives from 
both sites. 

B. To accomplish this, the Governor's May Revision proposes a redirection of the $1.8 million 
identified for the transition of services due to the sale of EdFund to cover the Commission's 
relocation costs. 

Those, then are the transitional issues the Commission has had to address. I believe they have handled 
these transitional matters appropriately — however, it is true that addressing these issues has not been 
easy. 

I hope the preceding provides the information you requested. Please let me know if you need any 
additional information from me. 




\ 



Tomas A. Arciniega 

Commissioner 

California Student Aid Commission 



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110 



Lynne de Bie Senate Rules Committee 
5/?' 20 ° 8 MAY 3 2008 

Goals Appointments 

1 . Please provide a brief statement of goals that you hope to accomplish while 
serving on CSAC. 

The mission of the California Student Aid Commission is to make education beyond 
high school financially accessible to all Califomians. By statute, CSAC is responsible 
for ensuring the effective and efficient administration of state and federal authorized 
financial aid as well as providing leadership on financial aid issues and making public 
policy recommendations regarding financial aid programs. As a commissioner, I am 
committed to working collaboratively with fellow commissioners, CSAC staff, the 
Legislature, Administration, and all other stakeholders to ensure the success of CSAC 
programs. I am particularly interested in the following goals: 

Expansion and enhancement of outreach services: While the student aid 
commission has accomplished a great deal in this area, there is substantial work to be 
accomplished. Many students and their parents, especially underserved students, are 
unaware of the availability of financial aid. Public awareness campaigns and workshops 
to promote financial aid literacy remain crucial to the commission's goal of delivering our 
products and services. Programs such as Gear Up, Cal-SOAP projects, Cash for 
College, and I Can Afford College require on-going support and promotion to effectively 
serve all Califomians. 

Expansion of collaborative work: The opportunity to build coalitions and partnerships 
with public and private members of the educational community is very real and 
immediate. For example, AB 1540 will allow the commission to partner with public and 
private entities to accept cash donations, contributions and in-kind support for the Cash 
for College program. Effective structuring of these partnerships will be an opportunity 
for CSAC to build credibility, trust, and strong relationships with our stakeholders. 
Another focus in collaborative work is the strengthening of CSAC's relationship with 
financial aid associations, institutional financial aid representatives, student 
organizations, outreach professionals, and various agencies. I look forward to working 
within the advisory committee structure of CSAC to improve communication and policy 
building that enhances the Commission's ability to accomplish its mission. 

Increase California's investment in post-secondary education: CSAC must 
continue to be a leader in advocating for secure funding for its programs and services. 
The economic well-being of the State depends on a well-educated workforce. A goal of 
financial aid should always be to move students from "drawing from the tax base" to 
"contributing to the tax base." In short, the promotion of "school to work" is crucial. I 
believe that a renewed commitment to career technical education (including 
partnerships with high schools, community colleges, career/technical training programs 
and private industry) as well as an expansion of the Cal Grant C program could begin to 
address the State's needs for skilled workers. 

The commission's active role in safeguarding existing programs is an essential goal, 
especially in turbulent economic times. Of particular concern is the proposed cut to the 
Competitive Cal Grant program — a cut that would reduce the number of community 



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Lynne de Bie 

May 20, 2008 
Page 2 

college students who are served by Cal Grant programs by approximately 45%. As 
stated in the Institute for College Access & Success Issue Brief: "These aspiring 
students stand to lose the most — and pose the greatest loss to our workforce and 
economy — if they cannot afford the education and training that community colleges 
provide." (March 2008). It is essential that the commission serve the public interest by 
strong advocacy efforts to protect as well as to expand funding for all Cal Grant 
programs. 

2. Please provide a brief assessment of the challenges that you think face 
California's student aid system and what, if any, recommendations you would 
make to improve the system. 

It is my observation that California's student aid system faces challenges in the 
following areas: continued perception by the general population (especially among 
underrepresented populations) that college is neither affordable, nor accessible; scarcity 
of resources to provide adequate services and programs; difficulties in providing 
streamlined technological access to the Cal Grant Delivery System for students and 
institutions; and, difficulties in working with the United States Department of Education 
to simplify the Free Application for Federal Student Aid (FAFSA). 

Scarcity of resources impacts the commission's ability to provide comprehensive public 
awareness campaigns. Budget cuts will certainly reduce service hours, research 
capabilities, program development, and service to the public. Prior funding through the 
Student Loan Operating Fund no longer exists; the commission will now look to other 
resources for outreach activities. AB 1540 provisions will afford the opportunity for the 
commission to accept contributions in support of the Cash for College Program — a 
proven effective outreach activity. The continued support of Cal-SOAP projects will be 
essential; the dissemination of financial aid information to families throughout California 
through the efforts of the Cal-SOAP programs is the key to improving college-going 
rates. 

Providing technological improvements to the Cal Grant Delivery System remains a 
challenge, especially with budget reductions and the "disentanglement" of EdFund and 
CSAC. Significant progress has been made in implementing electronic upload and 
download of data and reports, electronic fund transfers, and improving WebGrants 
access for schools and students. The CSAC website, complete with many links to 
federal, state, and institutional websites, provides excellent support for anyone looking 
for financial aid information. Utilizing technology to provide information that encourages 
students to pursue post-secondary opportunities is yet another strategy that the 
commission should strongly support. This technology can also be used to communicate 
with award winners and schools to provide greater business efficiency. 

FAFSA simplification is long overdue. The commission continues to advocate for 
changes in the FAFSA application process so that this barrier to college access can be 
reduced. Until such changes are made, however, the commission is working to ensure 
that students and parents receive assistance in completing the required documents. 
Cash for College workshops feature "FAFSA Experts" as well as trained one-on-one 
assistants. Commission sponsored workshops for high school counselors and financial 



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Lynne de Bie 

May 20, 2008 
Page 3 

aid advisors also feature up-to-date FAFSA application information and strategies. 
These outreach efforts to assist students, parents, and educators are significant. My 
school has benefited by the commission's workshops, print materials, website, and call 
center. Commission staff members have attended financial aid workshops and college 
fairs at my school site, providing a wealth of information, support, and encouragement 
to students and parents. My recommendation will be that the commission continue to 
provide face-to-face services for schools — such powerful outreach programs are 
needed to assure Califomians that post-secondary education can be affordable and 
accessible. 

3. A majority of the members of CSAC have served for less than two years. What 
is the commission doing to inform and educate new members regarding items 
which come before the commission and, in general, issues affecting student 
financial aid? 

As a newly appointed commissioner, I have been very impressed with the array of 
information that has been provided to me. All new commissioners attended a 
mandatory, comprehensive orientation that provided an introduction to commission 
staff, EdFund staff, other commissioners, and facilities. Commissioners were provided 
an orientation manual that clearly articulates the commission's governance process, 
policy-making principles, mission, history, and organizational structure of the 
commission as well as information regarding the key elements of Cal Grants and federal 
loan programs, including extensive input regarding EdFund programs. Background 
information about state agencies, state and federal legislative and budget processes, 
post-secondary institutions, non-profit organizations, professional organizations, and 
advisory groups was provided. A significant portion of the orientation was devoted to 
the explanation of the various responsibilities, projects, and current "hot topics" of 
CSAC's various divisions: Program Administration & Services, Information Technology 
Services, Public Affairs, Research & Policy Analysis, Management Services, and 
Federal Policy & Programs. 

In addition to the comprehensive orientation manual, commissioners were supplied with 
an Ethics Training Manual that thoroughly reviews the commission's policies pertaining 
to the Incompatible Activities Statement and the Conflict of Interest Code as well as 
information from the California Fair Political Practices Commission. Included in the 
manual was "A Handy Guide to the Bagley-Keene Open Meeting Act 2004" for 
commissioner review prior to the Orientation session. As a follow up to the Ethics 
Training Manual, a teleconference call was made to each commissioner. Chief Deputy 
Keith Yamanaka and Deputy Attorney General Geoff Graybill provided me with a 30- 
minute orientation on the mandates set for by the Fair Political Practices Commission, 
Bagley-Keene Open Meeting Act, California Public Records Act, and all applicable laws 
and governance requirements, including Conflict of Interest. I particularly appreciated 
their information concerning protocols for appropriate e-mail communication among 
commissioners. 

On March 27, 2008, a Strategic Planning Retreat for the commissioners was held on my 
high school campus. Designed by the Personnel, Evaluations & Nominating Committee 



Lynne de Bie 

May 20, 2008 
Page 4 



and CSAC staff, the retreat provided a daylong opportunity for Commissioners to focus 
on pertinent information provided by a variety of guest speakers, including 
representatives from The Institute for College Access and Success, the Public Policy 
Institute of California, and Time Structures. Power point presentations and reports 
included the following: "Green Lights & Red Tape: Improving Access to Financial Aid at 
California's Community Colleges," PPIC surveys ("Califomians & Higher Education," 
"Population Trends and Profiles: Can California Import Enough College Graduates to 
Meet Workforce Needs?" "Population Trends and Profiles: California's Community 
College Students"), and "California's Future Workforce: Producing New Technology and 
Products for New Market in Real Time." Commissioners also reviewed the 2000-2005 
CSAC Strategic Plan document, and brainstormed ideas for creating an updated 
Strategic Plan. A highlight of the day was the presence of two UC Davis students who 
shared their Cal Grant program experiences with the commissioners and staff. 

Commission meetings have included agenda items that serve to inform commissioners 
of the work of financial aid associations such as the California Association of Student 
Financial Aid Administrators (CASFAA), California Community Colleges Student 
Financial Aid Administrators Association (CCCSFAAA), and California Lenders for 
Education (CLFE), as well as directors of Cal-SOAP projects. Reports from the various 
committees of the commission also provide valuable background information and 
current updates for commissioners. For example, the Grant Advisory Committee Chair 
supplied recommendations for the commission's consideration in regard to the following 
topics: Student Expense Budgets and the preliminary awarding of Cal Grants; GPA 
Requirements for Cal Grant programs; Effects of Elimination of Cal Grant Competitive 
Program; and GAC Workgroup Priorities for 2008/09. 

The Governance and Monitoring Committee presented an update on state issues and 
legislation to the commission at its April 17-18, 2008 meeting, along with a thorough 
review of the Commission's 2007-08 Statement of Legislative Principles. The detailed 
analysis provided by Legislative Liaison Ann Shimasaki served to inform the 
commission of impending bills and to prepare commissioners for advocacy work as the 
opportunity may arise. 

The commissioners have been assigned to committees, and have met with key 
stakeholder groups and advisory bodies to build working relationships. Committee 
meetings as well as teleconference sessions are held regularly, and comply with 
provisions of the Bagley-Keene Open Meetings Act and the Fair Practices Code. 

Commissioners have requested that each CSAC meeting feature a guest speaker to 
discuss affordability and college access. Commission staff has designed a form for 
speakers to be recommended by commission management or commissioners. It is the 
expressed desire of the commissioners that a strong focus be made on outward vision 
and strategic leadership; consideration of input from a variety of stakeholders and/or 
researchers supports improvement in the commission's governance process. 
Commission staff supplies commissioners with a wealth of materials, and are always 
available to answer questions. A designated Commissioner Liaison handles meeting 
arrangements and commissioner notifications; ongoing communication is also 



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maintained with the Executive Director. Open communication is the hallmark of the 
CSAC; emails and web publications are sent regularly to commissioners. Examples of 
effective communication tools are the readily available issues of "Fast Blast" and the 
"Keeping You Informed" newsletter for internal staff. 

4. Should the commission be advocating for a statewide student fee policy? if so, 
what are the key elements of such a policy? 

The Legislative Principles that guide the commission's policymaking and advocacy 
efforts specify that the commission should advocate for policies that "foster educational 
access and affordability.... cultivating legislative and budget actions that protect, 
strengthen, and increase the state's General Fund commitment to student financial aid." 
The commission strongly advocates for maintenance of funding levels and appropriate 
increases to the number of Cal Grant awards as student fees continue to fluctuate. 
While the commission has not taken a formal advocacy position on the issue of a 
statewide student fee policy, I believe that it would be in the commission's interest to do 
so, keeping in mind that a primary goal of the commission is to serve the interests of 
students. Providing a fee structure that is reasonable, stable, and predictable would 
benefit students and their families in budget planning and saving money for 
postsecondary education. One of the reasons that so many Califomians believe that 
college is neither affordable nor accessible is that the costs have increased so rapidly 
and so significantly over the past few years. The ups and downs of the state budget 
create financial insecurity for public education; the University of California and the 
California State University systems have increasingly leaned on students and families to 
cover the shortfalls. Budget shortfalls also result in decreased access for students. For 
the first time in its history, the CSU system cut off freshmen applications, resulting in 
about 10,000 students not being admitted for fall 2008. Stability in college admissions 
rates and fee structures would help ensure opportunity and choice for California 
students. 



5. Is the commission informing itself about the rising costs of attending college in 
California, especially the growth of non-fee-related expenses? If so, can the 
commission act to address non-fee related expenses? How? 

CSAC is a leader in gathering data that accurately reflects the costs of postsecondary 
education. In cooperation with UC, CSU, Community Colleges, Independent Colleges/ 
Universities, and private career colleges, the commission administers the Student 
Expense and Resources Survey (SEARS) to over 70,000 students on a triennial basis. 
The SEARS Advisory committee meets on a regular basis to update the survey so that 
student expenses can be accurately queried. For example, the survey was updated to 
include various "non-fee" related expenses such as course materials fees and 
computer-related expenses. To ensure up-to-date information, commission staff also 
secures student expense data directly from colleges, research institutes, and foundation 
supported projects. Commissioners were recently supplied with a very thorough study 
("Green Lights & Red Tape: Improving Access to Financial Aid at California's 
Community Colleges") published in December 2007 by the Institute for College Access 



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& Success, as well as an issue brief ("Denied: Community College Students Lack 
Access to Affordable Loans") published in April 2008 by The Project on Student Debt. 
Both of these documents provide valuable, up-to-date information about the rising costs 
of education. 

The Cal Grant B program is specifically designed to assist very low income students, 
offering a "living allowance" of up to $1551.00 for the first year of college. This award 
level has remained unchanged since legislation enactment in 1999. Increasing the value 
of the Cal Grant B award, as well as guaranteed funding of Competitive Cal Grants, 
continues to be a high priority for the commission, as evidenced by our support of AB 
2365 (De La Torre) as well as the Legislative Analyst's Office recommendation to the 
Legislation to reject the proposed budge reduction that would phase out the Competitive 
Cal Grant program. 

The commission's publications, workshops, and newsletters are preparation tools that 
families, students, financial aid professionals, and high school counselors use to 
highlight money management strategies. Two particularly helpful publications, "Credit 
for College" and "Fund Your Future" were widely distributed to high school students this 
past year, compliments of CSAC and EdFund. These publications encourage students 
to build realistic budgets to help them get a clear picture of all college-going costs, 
especially non-tuition/fee expenses. CSAC's website also offers a wealth of information 
to assist students in managing education expenses. 

6. How does the commission determine the student allowance for books, supplies, 
and other living expenses associated with attending college, and does the 
allowance take into account the different costs of living in various parts of the 
state? 

Using data from the SEARS survey, the commission calculates student expense 
budgets for students who live on-campus, off-campus, or at home. These "Nine-Month 
Student Expense Budgets" are annually adjusted using the California Consumer Price 
Indices, which are determined by the Department of Finance. The commission also 
collects College Cost Estimate Forms from all Cal-Grant participating institutions on an 
annual basis; institutions are allowed to use whichever budgets more accurately 
represent student expenses for that part of the state. The commission offers extensive 
training to college financial aid officers. In the fall of 2007, over 620 college financial aid 
administrators attended workshops. Commission staff also provided fifteen special 
request training sessions for schools with specific needs. The commission is committed 
to working collaboratively with its partners in postsecondary education to meet the 
needs of students in all geographic regions of the state. 

7. As the credit crunch pushes lenders to stop issuing loans, does CSAC have an 
advocacy role to ensure that federally guaranteed student loans will be available 
to students and their families for the fall 2008 semester? 

CSAC, in partnership with EdFund, has submitted an updated and complete proposal of 
its Lender of Last Resort (LLR) program to the US Department of Education. This 



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document clearly outlines policies and operating procedures that will be followed in 
fulfilling requirements of the Federal Family Education Loan program. CSAC/EdFund, 
serving as student loan guaranty agency, has actively pursued eligible lenders to serve 
as LLR providers. With no lenders willing to participate in the LLR program, 
CSAC/EdFund must pursue federal fund advances under the "Advanced Funds" model. 
Commission and EdFund staff continues to explore all possible solutions to potential 
statutory conflicts, and are committed to resolving whatever difficulties remain in 
securing the LLR program. 

8. What are the commission's plans if banks continue to drop out of the federal 
program? Has the commission been engaging colleges and universities in this 
issue? 

CSAC is actively engaged in working with the Governor and Legislature to propose 
legislation that would remove the potential statutory conflicts that may affect CSAC's 
ability to act as a Lender of Last Resort. As mentioned in answer #7, a proposal has 
been submitted to USDE; the commission is now waiting for final information from 
USDE on the program's fee structure. The goal is to resolve outstanding issues as 
quickly as possible so that all eligible student borrowers will have access to the loans for 
which they qualify, that they get the best service possible, and that the LLR program is 
truly used as a last resort. 

CSAC and EdFund have contacted California institutions, assuring them of the 
commission's commitment to provide services to students and colleges. CSAC/EdFund 
has well-developed distribution channels for communicating up-to-date information. 
These include the California Association of Student Financial Aid Administrators 
(CASFAA) list serve, which reaches 1,513 administrator members; California 
Community Colleges Student Financial Aid Administrators Association (CCCSFAAA) list 
serve, which reaches 1,512 members; and California Association of Private 
Postsecondary Schools (CAPPS) list serve, which reaches 204 members from the 
proprietary sector. The commission's Loan Advisory Group (LAG) has also been 
involved in reviewing activities and policies, and advises the commission of its findings 
and recommendations. Members of LAG include representatives of the lending 
community, the higher education segments, and students. 

9. Through its financial aid outreach programs, is the commission able to provide 
student borrowers with substantive information and loan counseling before they 
enter into private loan agreements? If so, please describe. 

CSAC and EdFund both maintain extensive websites that link students and parents to 
information about loan procurement and management. High school students and their 
parents most frequently use the "Fund Your Future" workbooks and brochures, as these 
items are readily available in schools. A very extensive "Fund Your Future Counselor 
Guide" is designed for counselors and other student advocates. EdFund also offers 
extensive training and publications, including Power Point presentations, to schools and 
colleges. These loan counseling tools help students understand their rights and 



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responsibilities as borrowers. The materials are designed to be used by financial aid 
counselors to facilitate group entrance and exit counseling, graduate student 
workshops, and new student orientation sessions. EdFund's video "Private Loans: 
Closing the Gap" emphasizes private loans as a secondary funding source; topics 
include information about selecting a loan that best meets student needs, the impact of 
credit on loan eligibility, an overview of costs associated with interest rates and fees, 
and tips on getting a private loan approved. 

10. What is the commission doing to encourage community college students to take 
full advantage of financial aid resources available to them? Should other steps 
be taken? 

Active partnerships with the California Community College Chancellor's Office as well 
as the California Community College Student Financial Aid Administrators Association 
provide opportunities for the commission to participate in a variety of effective outreach 
programs. The following are examples of commission activities that target community 
college students: direct involvement with the "I Can Afford College" campaign, 
complete with a website in both English and Spanish; year-round message posters 
(created and printed at commission expense); advertisements in mass transit systems; 
commission staff participation in the California Community Colleges information booth at 
the California State Fair; Cal Grant messaging that emphasizes the September 2 
deadline for community college students; participation in community college foster youth 
events; and extensive information for community college students and financial aid 
personnel that is posted and continuously updated on the CSAC website. 

CSAC's Executive Director, Diana Fuentes-Michel, is credited as a contributor to the 
recently published "Green Lights & Red Tape: Improving Access to Financial Aid at 
California's Community College" — a groundbreaking document that will be extremely 
useful to community college financial aid programs, college administrations, and the 
Chancellor's office. The report focuses on policies and practices that vary widely from 
college to college and can have a particularly significant effect on students' access to 
financial aid. 

The commission plans to continue to actively advocate for ongoing funding of the grants 
most used by community college students — the Cal Grant Competitive Awards. The 
commission will also strongly advocate for increasing the value of Cal Grant B awards 
so that the lowest income students can gain additional subsistence support. 

Additional steps that could be considered include the following: extending the deadline 
for entitlement grants until September 2 so that entering students are given equitable 
consideration for funding; providing viable options and pathways to higher education, 
work and citizenship for undocumented students; expanding work^study and internship 
programs at the community college level to create intellectually engaging jobs that 
support academic progress and preparation for the workforce. 



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1 1. What is the commission doing to influence the development of federal financial 
aid policies under review in Congress that have a direct impact on California 
students? 

The commission routinely provides information regarding significant financial aid 
policies to Legislators so that they can effectively advocate on California's behalf when 
visiting Washington, D. C. The commission has also testified at Congressional hearings 
held in California, seeking to influence the development of federal financial aid policies 
that would benefit Califomians. 

While EdFund staff carries the primary authorization to interface with the United States 
Department of Education, CSAC staff keeps apprised of federal loan program issues, 
and works cooperatively with EdFund, the Department of Finance, and Administration to 
ensure that California interests are being represented. In the past few months, 
significant CSAC time has been devoted to developing loan program strategies that 
must be approved by the USDE. 

As a member of the National Council of Higher Education Loan Programs (NCHELP), 
the commission participates in a national network of FFELP affiliated organizations in 
advocacy efforts to promote student access and choice for postsecondary education 
with the legislative and executive branches of the federal government. NCHELP has 
undertaken a variety of initiatives that relate to college access; work groups in the 
council develop resources to help guaranty agencies (such as CSAC) expand their 
outreach activities to reach a broader number of students, families and organizations. 
They also share resources about the technical assistance available in starting 
programs, as well as working with national access organizations to help support 
national and state initiatives and leverage existing resources. 

The commission also holds membership in the National Association of State Student 
Grant and Aid Programs (NASSGAP) to provide information to the US Department of 
Education and Congress regarding current trends in financial aid. The association 
provides assistance to its members with advisory information about federal legislation, 
federal forms, links to research, and opportunities to network in national conferences. 

12. How does the commission prioritize its outreach activities to reach the lowest 
income students in the state? How does the commission reach out to non- 
English speaking communities? 

The commission has utilized the services of the University of California All Campus 
Consortium On Research for Diversity (UC ACCORD) to develop a weighted 
methodology that efficiently directs the commission's outreach efforts. UC ACCORD 
serves as an information and research clearinghouse that utilizes the research expertise 
of the University of California to identify strategies that will increase college preparation, 
access, and retention. The commission's partnership with UC ACCORD has yielded 
valuable demographic information that allows the commission to accurately target its 
outreach activities, including financial aid workshop offerings, direct mailings, and public 



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awareness campaigns in the areas of California with high percentages of low-income 
students. Over 300 schools have been targeted for priority outreach services. 

The California Student Opportunity and Access Program (Cal-SOAP) offers services to 
students in 15 regions of California, providing information about postsecondary 
education and financial aid to low-income students. Many Cal-SOAP projects hire low- 
income college students as tutors and advisors; these students serve as role models 
and mentors to elementary and secondary students. Additionally, most Cal-SOAP 
projects employ bi-lingual staff members who provide primary language or bi-lingual 
workshops, counseling services, and translated materials to students and parents. 

CSAC programs and partnerships provide financial aid and services that assist students 
of all ethnic groups in attaining postsecondary education. CSAC programs are 
designed to not only help students and parents, but to also supply teachers, counselors, 
and financial aid personnel with useful tools and information. The CSAC website is 
available in Spanish; other multilingual materials, including the "Fund Your Future" 
workbook, are readily available. CSAC's outreach programs include targeted public 
awareness campaigns in underserved, non-English speaking communities, using a 
variety of approaches through television, radio, print media, and community and faith- 
based groups. In 2008, Cash for College workshops were held in ninety percent of 
California counties; workshops were offered in Spanish, Vietnamese, Hmong, Chinese, 
Korean, and Tagalog. 

I would like to provide you an example of a very successful local financial aid outreach 
effort this year. In collaboration with UC Davis, Solano Community College, Napa 
Valley College, Migrant Education, and the Dixon Public Library, the Dixon High School 
counseling staff organized two evening workshops for students and parents. The first 
workshop was entitled "Financial Aid 101" and was conducted in two separate locations 
on the Dixon High School campus for English and Spanish speakers. The guest 
speakers were financial aid counselors from Solano Community College and Napa 
Valley College. Materials included "Fund Your Future" in both English and Spanish, and 
a variety of brochures supplied by CSAC and the community colleges. Our second 
evening featured a Cash for College workshop, staffed by DHS counselors, a Solano 
Community financial aid outreach advisor, UC Davis EAOP staff, an aide to 
Assemblyman Coto, and a "crew" of UC Davis students who are members of the UC 
Davis Hermanos Macehual club. Side-by-side assistance in filling out the FAFSA was 
offered to parents in both English and Spanish in two different computer labs. Phone 
calls to CSAC personnel regarding specific questions were made and answers 
gratefully received. Many parents and students were able to complete the FAFSA that 
evening, and all are eagerly awaiting the results of the Cash for College $1000. 
incentive scholarship that will be awarded to one of our students. Over half of our low- 
income families attended this event; next year, there will be more. 

13. Are you satisfied with how the commission helps families complete the Free 
Application for Federal Aid to increase access to financial aid? Should more be 
done? 



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The Cash for College workshops are the most efficient and successful outreach 
programs available to help families complete FAFSA applications. Statistics reveal that 
the workshops are helpful to students, with nearly two-thirds of students who 
participated in last year's workshops enrolling in community colleges or four-year 
colleges in fall 2007. The incentive scholarship, offered by CSAC in partnership with 
the College Access Foundation of California, served to encourage student attendance 
as well. The commission looks forward to further collaboration with private businesses 
and other institutions to fully implement the provisions of AB 1540, which will provide 
additional funding for the Cash for College program. 

CSAC provides a wealth of training opportunities for high school counselors and other 
financial aid advisor to update their knowledge of FAFSA requirements and Cal Grant 
programs. Printed materials, power point presentations, counselor guides, and a user- 
friendly website all assist education professionals in providing accurate information to 
families and students. High school counselors particularly appreciate the complete "Cal 
Grant College Cash Box" that contains posters, handouts for students and parents, Cal 
Grant materials cd, lesson plans for teachers, sample press releases, PIN flyers, a dvd 
guide to filling out the FAFSA, copies of "Fund Your Future" counselor guide and 
student workbook, and much more. These materials provide encouragement for even 
the most inexperienced high school counselor to feel confident about disseminating 
information regarding financial aid. 

14. What is the commission doing to develop outreach programs that increase 
participation in the Cal Grant community college transfer entitlement program? 

Community College students are a difficult market. Many of them experience changing 
circumstances in the years immediately following high school, and the need to be self- 
supporting takes precedence over finishing coursework. Some come to the community 
college academically unprepared; many are not goal directed. Many students enter 
community colleges thinking that because the classes are so "affordable" that applying 
for financial aid isn't necessary. I have counseled high school students who don't 
understand the academic load of college, and believe that they can hold down full time 
jobs because they think attending three or four classes isn't very much time, or that they 
will be able to do all of their coursework at home on-line in the evenings. These are the 
students who end up not qualifying for grant awards due to low grade point averages or 
insufficient units. 

The answers to the problems listed above involve changing public perception about the 
academic rigor of community college programs, and continued marketing of financial aid 
information directed toward community colleges. The "I Can Afford College" campaign 
is an excellent starting place. (Please see answer #10 for more details.) Cal-SOAP 
projects are also valuable resources for community college students; many have 
mentoring and informational services as well as activities that promote the transfer 
entitlement grant program. 

CSAC's website and materials are also helpful resources for all college-aged students. 
Financial aid administrators and counselors at many community colleges work within 
some fairly difficult budget constraints to deliver information and support to their 



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students. The commission's interest in increasing Cal Grant B levels of funding as well 
as the ongoing support of funding for the Competitive Cal Grants remain at the forefront 
of the commission's concerns. 

15. Briefly describe any outstanding transitional issues related to the sale of 
EdFUND, and how the commission is addressing these issues. 

With the recent advisement that EdFund will not be sold until the 2009-2010 budget 
year, the commission has revised its transition plans in terms of commission operations 
and programs. A transition team has been working diligently to plan for staff reductions 
due to budget cuts, as well as the sale of EdFund. Several key CSAC staff members 
have already left the commission in anticipation of lay offs, leaving a void in several 
programs. With the postponement of the sale of EdFund, 24 civil service positions 
assigned to EdFund have been restored, relieving some of the pressure on CSAC to 
"absorb" these workers. In addition, six positions within CSAC have been restored to 
continue oversight of EdFund Operations. Nevertheless, there are issues that remain 
unresolved for CSAC in regard to staff changes, and commission management is 
currently analyzing how the proposed sale of EdFund affects the proposed lay-off plan. 

Another issue of concern is the planned relocation of CSAC offices and EdFund's move 
to their new data center and future move to new offices at Mather Field. The 
Information Technology Division has moved equipment from EdFund into CSAC offices 
to insure network connectivity for CSAC headquarters after EdFund completes its move 
to Mather Field. Replacement equipment for the phone systems will be installed in 
June. 

Details relating to the FFEL programs, Lender of Last Resort programs, and concerns 
regarding personnel matters that may be affected by the future sale of EdFund continue 
to require the commission's attention. In all matters, the California Student Aid 
Commission remains committed to creating opportunities and exploring new initiatives 
to achieve its mission to make education beyond high school financially accessible to all 
Californians. 

I would be honored to be a part of that process. 



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Senate Rules Committee 

MAY 3 2006 

Commissioner Peter C. Hankwitz 

Appointment California Student Aid Commission 

Senate Rules Committee Confirmation Hearing Responses 

Prepared as of May 23, 2008 



Goals 

1. Please provide a brief statement of goals that you hope to accomplish while 
serving on CSAC. 

RESPONSE : As my actual service on the California Student Aid Commission 
(CSAC) has barely spanned three months, it would be difficult to provide a broad 
reaching set of goals at this time. However, one has certainly risen to my attention. 
That is the fundamental Mission of CSAC: to make education beyond high school 
financially accessible to all Californians. 

As broad as this Mission's goal may seem, I believe it to be an attainable one, and 
one to which I am honored to lend my assistance. 

For more than two decades, my professional perspective as a manager of high 
profile clients and projects has remained focused essentially on the identification of 
three basic elements in the provision of advice and counsel: simplified goals; the 
apparent and real obstacles to achieving them; and the plan(s) of action to attain 
the desired outcome. 

Since we are likely to both create and discover many new and varied goals during 
my term of service, and I hope to accomplish each of them in collaboration with my 
colleagues and the CSAC staff in an expeditious and thoughtful manner. 

As Chair of CSAC's Audit Committee, I also expect to delve deeply into CSAC's 
(required) oversight of all programs and outcomes under its purview. Regular audit 
activities are vital to the proper function of any government agency. 



2. Please provide a brief assessment of the challenges that you think face 
California's student aid system and what, if any, recommendations you 
would make to improve the system. 

RESPONSE : The challenges faced by CSAC are many, though the solutions, I 
believe, may each contain a form of increased public awareness and outreach, and 
a clarified message(s) to the various communities and stakeholders served. 

As one of its primary operational functions, CSAC delivers more than $800 million 
in Cal Grant entitlements to eligible students each year, and, in my estimation, the 
staff continues to undertake this effort with aplomb, focusing squarely on the 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



Mission, and quickly recognizing opportunities that may help the process work 
more effectively, and then implementing such technical and philosophical 
procedures, as and when possible. Additionally, with the cooperation of the United 
States Department of Education (USDE) in simplifying the Free Application for 
federal Student Aid (FAFSA), CSAC staff will be able to streamline Cal Grant 
delivery even more. 

Additional funding dedicated solely for outreach will also assist the staff in making 
this and many other processes more efficient, by allowing them to more effectively 
provide the necessary basic information to the public through programs such as the 
California Cash For College program. 

To this end, Assembly Bill 1540 (allowing CSAC to accept contributions and other 
funding, including in-kind contributions) has the potential of greatly assisting 
CSAC's efforts in support of the Cash For College program. I believe that a 
combination of private and public funding sources can often be the best solution to 
costs for outreach and awareness in similar situations, and hope that a dedicated 
team will be assembled on behalf of the grant and other financial request efforts 
now allowed under AB 1540. 

I am confident that CSAC staff will continue to educate us Commissioners about 
other issues and obstacles they believe to be key in preventing them from 
functioning most effectively. 



3. A majority of the members of CSAC have served for less than two years. 
What is the commission doing to inform and educate new members 
regarding items which come before the commission and, in general, issues 
affecting student financial aid? 

RESPONSE : The first official CSAC meeting I attended was a wonderful 
orientation regarding the policies, procedures and educational development of 
those of us serving on the Commission. 

Among the volumes of information provided to us at that initial orientation meeting, 
perhaps chiefly among them was CSAC's "Commission Governance Process 
Policies" (Policies) which clearly set forth our roles, authority and responsibility as a 
Commission and as individual Commissioners. The Policies state that "Continual 
education and development for Commissioners will include a mandatory, 
comprehensive orientation of new members. " 

Among the information presented during this orientation were: a working 
knowledge of key elements of the State administered financial aid and loan 
programs; an understanding of mandates set forth by the Fair Political Practices 
Commission, Bagley-Keene Open Meeting Act, California Public Records Act, and 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



all applicable law and other governance requirements; a working knowledge of 
state agencies, state and federal legislative and budget processes, and non-profit 
organizations; and presentations and discussion to inform us of the State 
administered financial aid and loan programs. 

Further, the Policies state that CSAC will "ensure that a strategic plan is developed 
for the CSAC entity as a whole, based on the State administered financial aid and 
loan programs' strategic and annual plans . . . [to] focus on the linkages between 
the two organizations and how synergies can support the overall mission" of 
CSAC. We have already begun this strategic plan effort in earnest. 

These Policies, adopted by CSAC in November 2007, have been tremendously 
helpful in guiding my thoughts and actions during my service. Additionally, many 
members of the CSAC staff have been obliging in their immediate response to any 
questions and concerns I may have had since I was appointed. 



Rising Costs of Attending College 

4. Should the commission be advocating for a statewide student fee policy? If 
so, what are the key elements of such a policy? 

RESPONSE : In my opinion, should CSAC elect to advocate for such a statewide 
policy, at this time I would be inclined to support the advice of CSAC staff; that it be 
"predictable, reasonable, and require timely notification to students of fee 
changes." 

However, what I would consider most important in a debate regarding such a policy 
is its likely and fundamental impact on CSAC's Mission, i.e. would it increase or 
impede financial accessibility to higher education for all Californians? 

This is a critical distinction, and one that would require much more input from my 
colleagues and CSAC staff prior to making any such decision. 



Is the commission informing itself about the rising costs of attending college 
in California, especially the growth of non-fee-related expenses? If so, can 
the commission act to address non-fee related expenses? How? 

RESPONSE : Without hesitation, yes. 

One of the primary and ongoing updates we receive from the CSAC staff and other 
organizations and stakeholders is information regarding rising costs of college 
attendance, and the related living expenses, etc. 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



In fact, during a retreat in March 2008, several of my colleagues and I received 
presentations containing research and polling statistics regarding this very subject. 

Clearly, the impact of rising higher education costs is a top priority or consideration 
by CSAC, and I look forward to seriously reviewing it further to see where CSAC 
can have the greatest effect in addressing ways in which those costs - even 'non- 
fee related expenses' - can be reduced and/or offset for students and their 
families. 

The non-fee related expenses are a fact of life, and CSAC must consider room and 
board, personal expenses, computers and books, and transport to and from 
classes to be fully a part of the cost of education, and exploring where the purview 
of its Mission can be of assistance, if at all. 



How does the commission determine the student allowance for books, 
supplies, and other living expenses associated with attending college, and 
does the allowance take into account the different costs of living in various 
parts of the state? 

RESPONSE : Some colleges will send 'student allowance' budgets to CSAC when 
they consider such information to accurately reflect the part of the state in which 
the college is located. Primarily, however, it is my understanding that this 
information is gathered (statewide) by CSAC through its Student Expense and 
Resources Survey (SEARS), issued every third year to update its understanding of 
the real world expenses associated with college education. 

It is my further understanding that the combination of the information received from 
individual colleges and that collected through SEARS provide a rather specific and 
full view of the landscape of living expenses related to college attendance. 



The Future of Student Loans 

7. As the credit crunch pushes lenders to stop issuing loans, does CSAC have 
an advocacy role to ensure that federally guaranteed student loans will be 
available to students and their families for the fall 2008 semester? 

RESPONSE : The "credit crunch" seems to be pushing lenders to stop issuing non - 
federally guaranteed loans. This is an important clarification, in that lenders have 
not stopped issuing loans, per se, just those student loans which pose a higher risk 
to the lender itself. 

With that said, in compliance with federal Law, CSAC does have a lender-of-last- 
resort (LLR) program, to be made available to students who are eligible for a 



Page 4 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



Stafford loan, yet have been rejected twice for such loan requests, and are 
thereafter unable to find a lender for a Federal Family Education Loan, which is 
guaranteed by Federal law. (The LLR program is administered through EdFund, 
CSAC's non-profit auxiliary.) 

The USDE recently requested that CSAC provide a statement of its LLR policies 
and procedures, and CSAC Executive Director Dian Fuentes-Michel complied. 

These policies and procedures provide opportunities for LLR-eligible students to 
receive the student aid loan assistance they may need fro Fall 2008, though 
Governor Schwarzenegger's May Revision of the State Budget states that further 
legislation may be necessary to address what some consider to be a 'statutory 
conflict' affecting the CSAC's ability to meet its obligation to perform as a LLR. 



8. What are the commission's plans if banks continue to drop out of the federal 
program? Has the commission been engaging colleges and universities in 
this issue? 

RESPONSE : It is my understanding that the USDE, the broader student loan 
guaranty industry, CSAC and EdFund are all working in cooperation to put into 
practice a federal advance LLR program in compliance with the USDE's 
established guidelines. To this end, CSAC staff have plans to continue CSAC's 
, commitment to provide the highest level of service possible, not only to students, 
but also to universities and colleges. 

In fact, another letter from Executive Director Fuentes-Michel was delivered 
recently, as required, to the USDE and the California Department of Finance 
regarding CSAC's commitment to the maximum number of LLR loans that it would 
be willing to originate under the terms using the federal Advance funds. And, 
based on information provided by EdFund, CSAC's response to the USDE's 
request was that CSAC/EdFund expects to originate in its designated state of 
California up to $1.5 billion. 

In her letter, Fuentes-Michel defined "Designated state" to encompass "institutions 
located in the state of California and California residents attending school outside 
of California. Institutions located in the state of California include non-California 
campuses of corporate chain schools headquartered in California." She further 
expressed that "Under the current configuration of the LLR program, CSAC is not 
proposing to broaden its participation outside its designated state. " 

Communications were also delivered in April 2008 to institutions in California, 
making it clear that CSAC's Mission would be met. 

CSAC will continue to support eligible borrowers to the fullest extent possible. 

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Commissioner Peter C. Hankwitz 

May 23, 2008 



Through its financial aid outreach programs, is the commission able to 
provide student borrowers with substantive information and loan counseling 
before they enter into private loan agreements? If so, please describe. 

RESPONSE : The need for greater outreach and information dissemination (and 
the funding therefore) notwithstanding, "Fund Your Future" is a booklet published 
by EdFund and CSAC. 

It is considered the primary publication used by the majority of California's students 
who want information regarding the context and particulars of State, federal and 
private financial aid programs, their parameters, how to apply, and some potential 
pitfalls inherent in some private loans. The publication is also translated into 
Spanish, Vietnamese, Chinese, Korean, Hmong, Tagalog, Russian, and Armenian. 

(Please also note the related responses to questions 12 and 13, regarding 
outreach.) 



State Financial Aid Programs 

10. What is the commission doing to encourage community college students to 
take full advantage of financial aid resources available to them? Should other 
steps be taken? 

RESPONSE : As the largest constituency in California's higher education 
population, those enrolled in (or considering attending) community colleges may 
also benefit from better outreach by CSAC. 

But CSAC has historically been involved directly in many efforts to reach out to 
community college students regarding financial aid resources, especially the "I Can 
Afford College" campaign into the community college sector. 

Also among these efforts have been: Foster Youth (Chaffee Grant) programs; 
hundreds of Cash for College events; Community College student GPA provision 
directly to CSAC for targeted and individual outreach; plus Cal Grant Entitlement 
Awards — 73% of which were offered to students in the California Community 
College system in 2007. 



11. What is the commission doing to influence the development of federal 

financial aid policies under review in Congress that have a direct impact on 
California students? 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



RESPONSE : Personally, though I am confident that these efforts are undertaken 
regularly by CSAC staff, I am not yet aware of efforts to influence federal policies 
on behalf of California's students beyond CSAC's membership in the National 
Association of State Student Grant and Aid Programs (NASSGAP), and the 
National Council of Higher Education Loan Programs (NCHELP), which also 
promotes student access and choice for postsecondary education and training. 



Financial Aid Outreach Programs 

12. How does the commission prioritize its outreach activities to reach the 

lowest income students in the state? How does the commission reach out to 
non-English speaking communities? 

RESPONSE : CSAC administers and oversees many programs, chiefly among 
them: the Student Opportunity and Access Program (Cal-SOAP). Its statutory 
function is primarily to "increase the accessibility of postsecondary educational 
opportunities for any of the following elementary and secondary school students: 
(1) Students who are from low-income families. (2) Students who would be the first 
in their families to attend college. (3) Students who are from schools or geographic 
regions with documented low eligibility or college participation rates.'' 

There are currently 15 Cal-SOAP operations in various regions of the State, though 
they are in danger of significant budget cuts in the coming fiscal year - something I 
believe would be detrimental (and potentially devastating) to CSAC's outreach 
activities statewide. 

CSAC also administers the federal Gaining Early Awareness Scholarshare Trust 
(GEAR UP) awards in conjunction with the California Department of Education. 
Cal Grant and other financial information is provided to low-income middle school 
students to prepare them for higher education. 

Additionally, in recent years, CSAC has joined with the UC ACCORD research 
center to formulate plans for targeted outreach to low-income students. Among 
other things, the process devised helps to identify high schools in areas with high 
percentages of low-income students and other issues related to need, most 
importantly considered: family income. School counseling staff shortfalls and other 
relevant factors are also considered. 

Through Cal-SOAP and other methods, CSAC reaches out to non-English 
speaking communities via radio and television collaborations, print media, and the 
local grassroots efforts. CSAC's Cal Grants website (www.calgrants.org) is 
available in Spanish, as well. A full 35% of respondents to the 2008 Cash For 



Education Code section 69561(b) 

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Commissioner Peter C. Hankwitz 

May 23, 2008 



College exit survey (Survey) stated that Spanish was the primary language spoken 
in their homes. 



13. Are you satisfied with how the commission helps families complete the Free 
Application for Federal Aid to increase access to financial aid? Should more 
be done? 

RESPONSE : My level of satisfaction with CSAC's work in this arena is quite high. 

The California Cash For College program and Workshops are designed to help 
families successfully apply for state and federal financial aid. 

Lately, there is an additional incentive for families to attend a Workshop and 
complete the Free Application for Federal Student Aid (FAFSA) application, with 
the help and guidance of program volunteers and staff. Within certain parameters 
of eligibility, one student attending each Cash For College Workshop receives a 
$1,000 scholarship, through the program's partnership with the College Access 
Foundation of California. 

Should more be done? Yes. But more does not necessarily equal different, in this 
case. The Cash For College program works. The statistics support this claim, and 
clearly more students are now applying for financial aid, and attending college as a 
result, than in years past. 

A majority of Survey respondents indicated that the $1,000 scholarship incentive 
was a key factor in their attendance at the Workshop. Therefore, they were offered 
guidance through the FAFSA application process that they may not have otherwise 
received. 

The very name of the "California Student Aid Commission" addresses the core 
issue at stake for many families: financial aid. Continued provision of the 
additional financial incentive for families to attend these Cash For College 
workshops will undoubtedly increase the numbers of applicants completing the 
FAFSA even more in the future. The need for financial and other support is most 
noticeable at the local level. 



14. What is the commission doing to develop outreach programs that increase 
participation in the Cal Grant community college transfer entitlement 
program? 

RESPONSE : Again, the Cal-SOAP consortia provide outreach to many students 
regarding all types of opportunities for higher education, including community 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



colleges and career and technical programs, which is why it is so critical at the 
local level throughout our State. 

Cal-SOAP programs also provide mentorship for high school students, and regular 
education regarding Cal Grant community college transfer entitlements. 

Because of this, and other factors, one of the issues CSAC is currently considering 
is options to expand and/or at least maintain the present levels of Cal-SOAP 
funding and activities statewide. In light of the proposed State budget cuts, this is a 
difficult task, at best. 

In my own opinion, the final 2008-2009 (and future) California State Budget(s) 
should be mindful to exempt primary, secondary and higher education from 
significant reductions. We only have one chance to properly educate California's 
youth while they are still young. 



California Student Aid Commission and EdFUND 

15. Briefly describe any outstanding transitional issues related to the sale of 
EdFUND, and how the commission is addressing these issues. 

RESPONSE : Though some may say that the separation and disentanglement of 
CSAC from EdFund is long overdue, what remains significantly relevant to this 
issue appears to be the extraordinary and unfunded expenses that CSAC must 
bear in order to do so. 

Due to previous office space leasing plans made prior to the announcement that 
the EdFund asset was to be sold, CSAC had no separate plan in place not to share 
the physical location where EdFund will relocate, whether or not the entity is sold. 

Because of the timing of the termination of the existing CSAC office lease, CSAC 
must actually move its headquarters to a temporary location in summer 2008, and 
then move again within a few months, incurring outrageous and unexpected 
expenses in doing so - reallocating almost $2 million identified in the proposed 
State budget for the transitions of services due to the sale of EdFund, which must 
now be used to cover CSAC's relocation costs. 

It should be obvious to see that one outstanding issue related to the sale of 
EdFund is the lack of future funding available for CSAC to properly discharge its 
duties and provide necessary services. 

However, it is notable and commendable that, despite this looming transition, the 
CSAC staff have maintained their adherence to our Mission, and: made many of the 
necessary changes ahead of time to continue providing uninterrupted financial aid 



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Commissioner Peter C. Hankwitz 

May 23, 2008 



services to all Californians. These include, among others: moving the Cal Grant 
Delivery System (completed) and the Interactive Voice Response system (by June 
2008) to the state data center; preparing a necessary staff layoff plan; and ensuring 
that all other operational ad technical systems will be fully functional throughout 
any relocation(s). 



Included also herewith is a copy of the Form 700 submitted in January 2008. There 
have been no changes since it was originally filed. 



Page 10 
132 



I. Please provide a brief statement of goals that you hope to accomplish while 

serving on CSAC. 



As President/CEO of the Sacramento Asian Pacific Chamber of Commerce, 1 have 
worked in the economic development arena for over 10 years helping underserved 
communities achieve economic stability through small business capacity building 
programs. My passion is helping underservod communities achieve access and 
Opportunity. A primary goal of mine will be to ensure that ALL students have access 
and opportunity through the successful delivery of California's financial aid 
programs. With limited resources, we have to be more efficient and more creative 
while meeting the needs of California's students. It is my intention to help provide 
that out-of-the-box thinking that can lead us to solutions in delivery of services 
despite any resource constraints. 



2. 



Please provide a brief assessment of the challenges thai you think face 
California's student aid system and what, if any, recommendations you 
would make to improve the system. 

In the short term, the impact of this year's budget shortfall and the proposed sale of 
EdFund present serious challenges to CSAC Without sufficient resources it is difficult 
to administer the level of access and outreach needed to ensure that ALL students have 
opportunity through California's financial aid programs. 

The budget shortfall will have an impact on the efficiency of our overall delivery system 
as we work to complete the information technology conversion to real time, information 
technology utilizing web-based programs to enhance student services - increase access, 
without sufficient resources will be constrained. 

Funding for outreach will be affected. The authority obtained under Assembly Bill 1540 
to accept contributions and other funding, including in-kind contributions will go to 
support the California Cash for College Program which will ultimately become the main 
source of outreach funding for CSAC. As commissioners, we have to ensure that with 
the resources wc have, wc arc utilizing those resources as efficiently and effectively as 
possible. 

3. A majority of members of CSAC have served for less than two years. What 

is the commission doing to inform and educate new members regarding 
items which come before the commission, and in general, issues affecting 
student financial aid? 

CSAC' has adopted policies thai require continual education and development for 
Commissioners. We have committee structures that meet according to public notice 
procedures that focus on Governance and Monitoring, Audit, Programs, Planning and 
Budget, Personnel, Evaluation and Nominations and ad-hoc committees (i.e., strategic 
planning sub-committee) when needed. Within each of these committee structures, new 

Senate Rales Committee 
MAY 5 20QB 



133 



members are kept informed and educated. Wc also have advisory bodies and 
commissioner liaisons such as the Grant Advisory Committee, Cal-SOAP Advisory 
Committee, and. the Loan Advisory Council that ensures that Commissioners are kept 
informed and educated with our partners. 

4. Should the commission be advocating for a statewide student fee policy? If 
so, what are the key elements of such a policy? 

Currently, the Commission advocates for legislation that is directly related to financial 
aid. If wc were to advocate for a statewide student fee policy then I believe that any 
statewide fee policy should be accessible lo all, affordable to all, and require the timely 
notification of any fee change proposal. 1 also believe that transparency to the consumer 
is paramount to our credibility. 



Is the commission informing itself about the rising costs of attending college 
in California, especially the growth of non-fee-related expenses? Tfso, can 
the commission act to address non-fee related expenses? How? 



The Commission is keeping informed through survey methodology of our students every 
three years. The Commission, in collaboration with its partnering agencies administers 
the Student Expense and Resources Survey (SEARS) that gather data on the actual 
expenses arid financial resources of California's college atudenta. This survey it 
administered to over 70,000 college students attending community colleges, stale 
colleges, the universities, independent colleges and universities, and private career 
colleges. The data that is collected is used to produce an average non-month student 
expense budget that include room and board, transportation, personal expenses, books, 
supplies, computer-related expenses, and course material foee. Staff reviews the SF.ARS 
process and questionnaire on a continual basis to ensure its continued viability. 

6. How does the commission determine the student allowance for books, 

supplies, and other living expenses associated with attending college, and 
does the allowance take into account the different costs of living in various 
parts of the state? 

The Commission uses the data tfom the SFARS to calculate aveiagc nine-month student 
budgets for students living on campus, off campus, and with parents. In the non-survey 
years, these average nine-month student budgets are adjusted using the California 
Consumer Price indices prepared by DOF. Institutions are not required to use these 
average nine-month student budgeis but can submit their own budgets to the Commission 
each year if they feel lhat their own budgets more accurately reflect actual expenses in 

their geographic area. 



134 



7. As the credit crunch pushes lenders to stop issuing loans, does CSAC have 

an advocacy role to ensure that federally guaranteed student loans will be 
available to students and their families for the full 2008 semester'? 

Yes. 1 believe thai the Commission has an advocacy role to ensure that federally 
guaranteed student loans are available. 

Federal law guarantees the availability of a Federal Family Education Loan (FFF.I ) to 
eligible students, and if a student, who is otherwise eligible for a Stafford Loan, and after 
receiving two rejections, has been unable to find a FFF.L lender willing to make such a 
loan, that student is eligible for a guaranteed student loan issued under the lender-of-last- 
resort (LLR) program. The Commission, through F.dFund, has an LLR program, in place. 
Recent changes in federal law are now requiring the expansion of the LLR program. The 
Governor's Department of Finance and the Legislature are presently working with the 
Commission to expand the LLR program as deemed necessary by the change in lender 
participation in the LLR program. 



S. What are the commission f s plans if banks continue to drop out of the 

federal program? Has the commission been engaging colleges and 
universities in this issue? 

As stated above, the Commission, through GdFund. has an LLR program in place. The 
Commission has recently submitted a revised program plan to the federal government fur 
its approval. Currently, state legislation is pending to clarify that the Commission can 
expand its participation in the LLR program. The Commission working through its 
auxiliary is working to ensure that sufficient federal loan access is available for the 
coming academic year. Also, through EdFund, the Commission sent letters to California 
institutions assuring them of our commitment and what administrative steps are being 
taken to ensure students access to the federal loan programs. 

9. Through its financial aid outreach programs, is the commission able to 

provide student borrowers with substantive information and loan counseling 
before they enter into private loan agreements? If so, please describe. 

The commission publishes an educational piece called "Fund Your Future" which is 
jointly produced by the Commission and EdFund. This is the publication thai must 
California students use to find out about California's major financial aid programs, their 
requirements and how to apply for State and Federal financial aid programs including 
private loans. EdFund also provides information to schools and student borrowers on 
their responsibilities and rights as a student borrower. EdFund also provides default 
prevention tools to colleges and universities participating in the federal student Joan 

program. 



135 



10. What is the commission doing to encourage community college students to 
take full advantage of financial aid resources available to Them? Should 
other steps be taken ? 

For the 06/07 budget year, 73% of Cal Grant Competitive Awards were offered to 
community college students, with the remaining going to students participating in the 
other private and public colleges and universities in the State. The Cal Grant Enurlement 
Program which serves over 6S,000 new recipients each year directly from high school, 
provides approximately 36 percent of new awards to community college students. 
Outreach is done in partnership with the community college system with the "1 Can 
Afford College" campaign with many specific targeted outreach activities internal on 
campuses and external marketing (i.e., public transit, the state fair, call in shows), as well 
as California Cash For College workshops and foster youth events to provide Cal Grant 
and Chafcc information to fussier youth. 

There is opportunity to partner with the K-12 system in California and develop an 
outreach campaign as early as 4 grade to bring awareness to students and their parents 
prior to entry into the community college system. There is additional opportunity to 
develop private partnerships with associations, private business, industry, media and 
community-based organizations to provide additional resources in that specific outreach 
effort. 

11. What is the commission doing to influence the development of federal 
financial aid policies undar review in Congress (hut have a direct impact on 
California student? 

The commission staff works with the Administration to identify significant federal 
financial aid issues affecting California's students, and testifies at hearings held in 
California with respect to some of these issues. The commission also works with the 
State Legislature to educate members on federal issues. SO that they can lobby on our 
behalf in Washington, D.C. The Commission, through EdFund, also keeps track of 
federal loan program issues and coordinates with EdFund staff to ensure that California's 
student's interests are represented to the US Department of Education. 

The commission, is also members of the National Council of Higher Education Loan 
Programs and the National Association of State Student Grant and Aid Programs that 
lobby on behalf of its members with respect to public policy and regulatory issues 
affecting student access and other matters related to student financial aid. 

12. How does the commission prioritize its outreach activities to reach the 
lowest income students in the state? How des the commission reach out to 
non-English speaking communities? 

The Commission for the past three years has partnered with UC Aceord research center to 
develop a weighted methodology to target the Commission outreach, including media 
buys, direct mail, and workshops. The methodology uses factors to identify high schools 



136 



in areas with high percentages of low-income students as well as other key factors, 
including family income, parent education level, counselor to student ratios, graduation 
rates, and a school's Cal Grant student GPA submission method. 

The Commission also administers the Cal-SOAP program (Student Opportunity and 
Access Program) utilising bi-lingual staff and volunteers that are designed, by statute to 
outreach to those lowest income students. The Commission currently funds 15 Cal- 
SOAP projects throughout the State. Workshops and the Commission's website is 
student-friendly and available in multiple language access. The Commission also has 
created public awareness campaigns targeted to those identified non-Fnglish, low income 
communities to raise awareness; through the local California Cash for College campaign, 
Gear UP program, and the California Chafee Foster Youth Program. 

13. Are you sutisfied with how the commission helps families complete the Free 
Application for Federal Aid to increase access to financial aid? Should 
more been done in this area? 

The California Cash for College program is the primary vehicle that the Commission uses 
to help families complete the free application for federal aid. This year, over 500 Cash 
for College workshops returned more than 22 r 000 student evaluations, a 60% increase 
over prior year returns. Also, the California Cash for College program through its 
partnership with the College Access Foundation of California, offers incentive 
scholarships which encourage students to attend a workshop and submit their application 
prior to deadline. The Cal-SOAP partnerships also participate in the California Cash for 
College program which include services to parents including financial aid workshops, 
loan counseling, and college admissions workshops. 

There is opportunity to partner with the K-12 system in California and develop an 
outreach campaiEn as early as 4 grade to bring awareness to students and their parents 
prior to entry into the post secondary education system. There is additional opportunity 
to develop private partnerships with associations, private business, industry, media and 
community-based organizations to provide additional resources in that specific outreach 
effort. 

14. What is the commission doing to develop outreach programs that increase 
participation in the Cal Grant community college transfer entitlement 
program? 

The Commission's primary outreach program for this is Cal-SOAP, which promotes 
all levels of educational opportunities beyond high school including career technical 
programs, community colleges and four-year universities. Many Cal-SOAP 
programs have mentoring components for community college transfer students and 
the transfer entitlement grant is promoted there. 



137 



For the 2006-07 year, 4,386 California Community College Transfer Cal Grant 
Entitlement Awards were offered. This coming year, over 6800 new transfer Cal 
Grant Entitlement offers have been made. 

15. Briefly describe any outstanding transitional issues related to the sale of 
EdFund and how the commission is addressing these issues. 

In the Governor's May revision, the sale of EdFund is postponed until fiscal year 09/10. 
Many of the transitional issues related to the sale are being postponed, such as the 
establishment of the business and technology services within the Commission, services 
that arc currently being provided by EdEund. The cstablislunent of these services at the 
Commission will require additional resources will be addressed in a submittal of a 09/10 
budget change proposal. 

The Commission has been diligently at work in preparation of the sale de-tangling CSAC 
and EdFund's with the utmost concern in minimizing disruption of providing services to 
our students, staff and schools. This has not been easy process, layering on top of the 
proposed sale, is the 1 percent budget reduction for 08/09 that required submittal to the 
Department of Personnel Administration a staff reduction plan that will certainly impact 
delivery of services. 

The Commission is still scheduled to move to a new facility in the 08-09 budget year. 
Unfortunately, the approval to move was received late resulting in the Commission 
moving twice. Commission, staff has idemificd two new sites within 1.5 miles of our 
current location and have asked the Department of General Services to begin the lease 
negotiations. 

The Governor's May revision proposes a redirection of the $1 .8 million identified for the 
transition of services due to the sale of EdFund to cover the Commission's relocation 
costs. 

The Commission will continue to provide policy and operational oversight for EdFund 
during this period. The Governor's May Revision proposes to continue to fund the 
Commission's oversight division until such time that the sale occurs. "The Governor's 
initial call to eliminate the division has poised challenges in adequately staffing this 
important function. The Commission will work with management to ensure that 
appropriate oversight occurs while sale discussions; continue. 



138 



California Legislature 

MEMBERS 
ROY ASHBURN X^3lldX GREGORY SCHMIDT 

,,.„_ „„.,„ /£>/4i&$*§ttNr\ SECRETARY OF THE SENATE 

mW^JXMn NETTIE SABELHAUS 

GILBERT CEDILLO Hil^^li/'J appointments director 

ROBERT DUTTON X»|j|P^ 

ALEX PADILLA 



Senate Rules Committee 



DON PERATA 

CHAIRMAN 

May 5, 2008 



Bonaparte H. Liu 



Dear Mr. Liu: 

This is to inform you that the Senate Rules Committee will conduct a confirmation 
hearing on your appointment as a member of Student Aid Commission on Wednesday, 
June 18, 2008. We request that you appear. The meeting will begin at 1:30 p.m. in 
Room 113 of the State Capitol. 

We have prepared the following questions to which we would appreciate your written 
responses. It is expected that these responses will be in your own words, not those of 
staff. Please provide your responses by May 27, 2008. 

We would also like to receive an updated Form 700, Statement of Economic Interest, by 
May 27 



th 



Goals 

The California Student Aid Commission (CSAC) is the principal state agency 
responsible for administering state and federal financial aid programs for students 
attending public and private colleges and vocational schools in California. The 
commission administers the state Cal Grant Program and the federal Family Education 
Loan Program — two of the largest financial aid programs available to California 
students. 

1. Please provide a brief statement of goals that you hope to accomplish while 
serving on CSAC. 



STATE CAPITOL • ROOM 420 • SACRAMENTO, CALIFORNIA 95814-4900 • (916)651-4151 • FAX (916) 445-0596 



1397 



Bonaparte H. Liu 
May 5, 2008 
Page 2 



2. Please provide a brief assessment of the challenges that you think face California's 
student aid system and what, if any, recommendations you would make to improve 
the system. 

3. A majority of the members of CSAC have served for less than two years. What is 
the commission doing to inform and educate new members regarding items which 
come before the commission and, in general, issues affecting student financial aid? 



Rising Costs of Attending College 

Over the years, student fee levels have fluctuated significantly, making it difficult for 
students and families to anticipate and plan for paying college costs. The state currently 
does not have a formal student fee policy guiding how student fees are set. The 
Governor's proposed 2008-09 budget would raise student fees at all segments except 
for community colleges. University of California and California State University fees 
would increase 7.4 percent and 10 percent, respectively, which reflect fee increases 
anticipated by the segments when they developed their budget plans in the fall. It 
should be noted, however, that the Governor's budget acknowledges that the segments 
may increase their fees above their initially envisioned levels in order to backfill 
proposed unallocated General Fund reductions. 

4. Should the commission be advocating for a statewide student fee policy? If so, 
what are the key elements of such a policy? 

Even with proposed fee increases, California's public colleges' and universities' fees are 
considered low in relation to comparable institutions around the country. Nonetheless, 
college affordability is still a major concern for students and families. One reason is the 
non-fee costs associated with attending college. 

5. Is the commission informing itself about the rising costs of attending college in 
California, especially the growth of non-fee-related expenses? If so, can the 
commission act to address non-fee related expenses? How? 

6. How does the commission determine the student allowance for books, supplies, 
and other living expenses associated with attending college, and does the 
allowance take into account the different costs of living in various parts of the 
state? 



140 



Bonaparte H. Liu 
May 5, 2008 
Page 3 



The Future of Student Loans 

Student loans are an important component to financing the increasing costs of higher 
education. A recent study by the California Research Bureau found that private loans, 
made directly by lending institutions to borrowers, account for a quarter of all student 
loans. These loans carry adjustable rates, cannot be discharged in bankruptcy, and are 
not federally subsidized or guaranteed. Students across California may begin to see 
higher costs for college loans this summer, or be turned away by banks altogether as 
the credit crisis forces many lenders to scale back their activities. Students seeking 
federally guaranteed loans could be required to pay higher fees to borrow money, while 
students at community colleges and for-profit colleges may be denied private loans 
entirely because lenders consider them riskier investments than their peers at four-year 
educational institutions. 

7. As the credit crunch pushes lenders to stop issuing loans, does CSAC have an 
advocacy role to ensure that federally guaranteed student loans will be available to 
students and their families for the fall 2008 semester? 

8. What are the commission's plans if banks continue to drop out of the federal 
program? Has the commission been engaging colleges and universities in this 
issue? 

9. Through its financial aid outreach programs, is the commission able to provide 
student borrowers with substantive information and loan counseling before they 
enter into private loan agreements? If so, please describe. 



State Financial Aid Programs 

The commission administers California's Cal Grant program and several other 
specialized financial aid programs to help undergraduate and graduate students pay for 
college. The Cal Grant program provides grants to low- and moderate-income college 
students and helps them pay for fees, room and board, books, and other college-related 
expenses. The Cal Grant entitlement program guarantees students a Cal Grant award if 
students are recently graduated from high school, apply by March 2, and if they meet 
the GPA and income requirements. The Cal Grant competitive program is designed for 
college students who have been out of high school for more than one year. These 
students may compete for 22,500 competitive awards, if they meet the income and 
academic requirements. A March 2008 briefing by the Institute for College Access and 
Success reports that community college students are the most underserved by Cal 
Grants and are much less likely to get grants than students at other types of schools. 



141 



Bonaparte H. Liu 
May 5, 2008 
Page 4 



10. What is the commission doing to encourage community college students to take full 
advantage of financial aid resources available to them? Should other steps be 
taken? " 

For the last several months, Congress has made progress in reauthorizing the Higher 
Education Act. At issue, however, and still unresolved is a Maintenance of Effort (MOE) 
provision that would penalize states that fund higher education institutions below the 
level of the five most recent preceding academic years. The penalty for violating the 
MOE would be to withhold from states funding available to them under the Leveraging 
Educational Assistance Partnership (LEAP) grants. In California, LEAP federal funds 
are used by the commission to offset the General Fund of the Cal Grant program. 

11. What is the commission doing to influence the development of federal financial aid 
policies under review in Congress that have a direct impact on California students? 



Financial Aid Outreach Programs 

The Student Aid Commission and EdFUND engage in public awareness outreach 
activities to assist students and parents with the financial aid process. The commission 
promotes public awareness campaigns addressing Cal Grant opportunities, as well as 
programs offering assistance with completing the Free Application for Federal Aid and 
securing grade point verification for potential Cal Grant recipients. The California 
Student Opportunity and Access Program (Cal-SOAP) provides financial aid outreach 
through regionally coordinated consortia to students with low eligibility or low college 
participation rates. The Governor's proposed budget authorizes $5.7 million in funding 
for the Cal-SOAP program, a decrease of $637,000 from the current year. The transfer 
entitlement program is for graduates of California high schools who transfer from a 
California community college to a qualifying baccalaureate degree granting institution. 
Students must also meet academic and eligibility criteria. 

12. How does the commission prioritize its outreach activities to reach the lowest 
income students in the state? How does the commission reach out to non-English 
speaking communities? 

13. Are you satisfied with how the commission helps families complete the Free 
Application for Federal Aid to increase access to financial aid? Should more be 
done? 

14. What is the commission doing to develop outreach programs that increase 
participation in the Cal Grant community college transfer entitlement program? 



142 



Bonaparte H. 
May 5, 2008 
Page 5 



Liu 



California Student Aid Commission and EdFUND 

Operating under California statute, EdFUND is a nonprofit auxiliary organization of the 
commission which administers the Federal Family Education Loan Program on behalf 
of the state. EdFUND provides federal loan guarantees for California students and 
out-of-state students who obtain these federal loans. Current law (SB 89 and SB 91, 
Budget and Fiscal Review Committee, Chapters 182 and 184, Statutes of 2007) 
authorizes the Department of Finance's director to sell the state's student loan 
guarantee program (EdFUND), or enter into an alternative financial arrangement 
regarding these assets and liabilities. 

15. Briefly describe any outstanding transitional issues related to the sale of EdFUND, 
and how the commission is addressing these issues. 



Please send your written answers to these questions to Nettie Sabelhaus, Senate Rules 
Committee Appointments Director, Room 420, State Capitol, Sacramento, CA 95814. 

Thank you for your help. 

,-etrreecely, /^ -\ 

DON PERATA — ' 



DP:LG 



cc: Student Aid Commission 



143 



Responses of Bonaparte H Liu to the Questions Presented by the Senate Rules Committee 
in its Letter Dated May 5, 2008 (the "Letter") 

The following responses refer to the questions in the Letter in the same numerical order. 

1. My goals while serving on CSAC include: 1) understanding the current and prospective costs of 
higher education, the sources of student funding, and working with CSAC and other relevant 
entities to determine if there are better ways to provide funding (both grants and loans) to 
students looking to obtain post-secondary education and 2) advocating for greater access to 
higher education funding for students across all socio-economic strata. 

2. The rate of increase in the cost of higher education is outstripping the rate of increase in the 
funding available for students (both grants and loans). The growing cost to funding divide is 
challenging students who are obtaining more loans and working more employment hours 
making higher education more challenging to obtain and potentially less appealing to those in 
the lower-socio-economic segments of our population. Recommendations to improve this 
situation would be premature on my part, as I do not know enough about the details of the 
funding environment, particularly with the contraction in the student loan market from market 
lenders. 

3. In the two CSAC meetings that I have attended, there has not been much time allocated to the 
general and broader issues affecting student financial aid. The CSAC has been preoccupied with 
many mid-level issues of which they want to keep the Commissioners apprised and to obtain 
some opinions from the Commission. Consequently, the Commission has not had the time to 
discuss broader policy issues thus far. 

4. The answer to the question of a statewide student fee policy is a complex one, in which, I am 
not properly informed, thus far. The cost of public higher education in California is a 
relationship between and amongst the cost of student fees, the availability and cost of student 
grants and loans, the General Fund and budgetary constraints, and the political environment, to 
identify just a few of the various factors. In general, a student fee policy, while providing in 
concept some type of visibility as to the rate and method by which student fees could increase, 
might be helpful, but a policy that potentially locks in fiscal flexibility may give the Governor's 
Office and Legislature less flexibility in prioritizing the various budgetary priorities that arise 
each budget year. I think the question is nevertheless a good one to evaluate from a policy 
perspective and one in which the CSAC could be involved. 

As for the key elements to such a policy, I think affordability, transparency, a reasonable rate of 
increase, and accountability in terms of education spending are all important elements to 
evaluate and consider. 

5. I believe that CSAC has such information. The Commission; however, has not yet discussed this 
in the broader context of the overall cost of higher education and how the policies of the CSAC 
should respond. Effectively speaking, non-fee-related expenses and fee-related expenses are 
ultimately costs to the student, albeit, non-fee-related expenses may have a degree of flexibility 

Senate Rules Committee 

m 1 -. 



144 



Appointments 



Responses of Bonaparte H Liu to the Questions Presented by the Senate Rules Committee 
in its Letter Dated May 5, 2008 (the "Letter") 
Page 2 of 3 

in terms the range of such costs. Insofar as grant and loans can be used for non-fee-related 
expenses, within some limits, then I believe that this should be the extent to which the CSAC 
should address this issue. 

6. I do not know the specific answer to this question but I think it would be prudent and 
reasonable to take into account the cost of living of various regions in the state. 

7. I believe that CSAC has an advocacy role to encourage the availability of federally guaranteed 
student loans. However, advocacy is only so effective and the availability of state and federal 
funds for guarantees is one available lever, albeit limited in the current credit environment and 
the limited profitability relative to risk in the borrowing segment, in ensuring greater 
participation by private lenders. 

8. The Commission has discussed this issue in a cursory manner in my participation in the recent 
two commission meetings, thus far, in the context of the default fee issue amidst the backdrop 
of the decrease in private lender participation. I do not know if the commission has any plans to 
address the issue thus far, but it is clear that the private lender market, while troublesome in 
some ways, as is mentioned in the preamble to this question, is the source of last resort for 
students and families other than seeking part-time employment. Therefore, the private lender 
market is key in the student fee, non-fee expenses, student grant, and student loan equation to 
provide students with the funds available for higher education. 

9. I know that the Commission has an outreach program, but do not know if they are able to 
provide effective counseling regarding private loans. I worry that they may not. This question 
however, raises an issue that I have great concern with and so allow me to take the opportunity 
to advocate for the issue of financial literacy in secondary education. I strongly believe that 
many of the problems that our citizenry face in the midst of aggressive consumer business and 
financing practices (i.e., predatory housing lending, high credit card rates and debt, limited 
knowledge and action for retirement planning, decisions between spending vs. saving, planning 
and saving for college, etc.) are somewhat predicated by the lack of financial literacy. I strongly 
believe that a one semester requirement is critical in helping individuals plan and behave in a 
manner that is beneficial as they grow and age. That's all the time I'll take on this issue, but I 
believe that the lower socioeconomic segments of our society are most financially ravaged 
without such an educational offering and that this should be a high education priority in our 
secondary education system. 

10. I do not know what the Commission is doing on this issue; however, if efforts are not being 
directed I think we should determine: 1) why and 2) based upon the discovery of why, decide to 
prioritize or allocate resources to encourage greater awareness and participation in the Cal 
Grant program at the community college level. I think the community colleges provide a great 
step to either further post-secondary education or to vocational education and opportunities. 

11. I have not been informed, thus far, as to the involvement of the CSAC in the development of 
federal financial aid policies, although, this seems like it would be a significant issue for CSAC's 
involvement. 



Responses of Bonaparte H Liu to the Questions Presented by the Senate Rules Committee 
in its Letter Dated May 5, 2008 (the "Letter") 
Page 3 of 3 

12. I do not have sufficient knowledge as to how the Commission prioritizes its outreach activities to 
properly answer this question. However, I do agree with the principles suggested in the 
question and believe that the Commission should understand how CSAC makes such 
determinations with its Cal-SOAP participants. 

13. The answer to this question is unfortunately tied to the limited resources with which the Cal- 
SOAP program has with which to operate. I believe from what we have heard, although I have 
not had direct observational experience, that they are doing all that they can with limited 
resources. In general, as I have asked, I think it would be ideal to eventually have an 
information technology-based system whereby schools and school districts would be 
electronically linked to a central database whereby student grades, social security numbers and 
family financial information from the U.S. Internal Revenue Service would be linked so that 
students automatically know if they qualify or not for financial aid rather than needing to apply. 
This would eliminate the need for outreach. I understand that there are several political, 
resources, turf and other issues involved that would make this unlikely or difficult for all, but 
perhaps if partially implemented, it could reduce the need to broadly provide outreach services 
and allow outreach to be more directed to those individuals or schools that fall outside of this 
database. 

14. I do not know the answer to this question. 

15. The transitional issues that we have been informed of thus far relate to issues of: 1) new office 
space as the existing lease is soon expiring, 2) potential absorption of EdFund staff and efforts to 
retain existing CSAC staff, 3) operating budget. The commission staff is on top of most of these 
issues and keeps the Commission informed. As much of these transitional issues are operational 
in nature, I am confident that the staff is acting within their capacity to address all of the 
relevant issues. 



146 



600-R 

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ti\ 



HEARING 

SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 

TUESDAY, NOVEMBER 25, 2008 

9:07 A.M. 



DOCUI 



SDEPT 



SAI (SCO 

PL iARY 



601 -R 



SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 

- -0O0- - 



HEARING 

STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 

- -0O0- - 

TUESDAY, NOVEMBER 25, 2008 
9:07 A.M. 
- -oOo- - 



Reported By: INA C. LeBLANC 

Certified Shorthand Reporter 
CSR No. 6713 



1 

2 
3 

4 

5 

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13 

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21 

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24 

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APPEARANCES 
MEMBERS PRESENT 

SENATOR DON PERATA, Chair 

SENATOR GIL CEDILLO 

SENATOR ROBERT DUTTON 

SENATOR ALEX PADILLA 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 
JANE LEONARD BROWN, Committee Assistant 
NETTIE SABELHAUS, Appointments Consultant 
DAN SAVAGE, Consultant to SENATOR CEDILLO 
BILL BAILEY, Consultant to SENATOR BATTIN 
CHRIS BURNS, Consultant to SENATOR DUTTON 

ALSO PRESENT 



MASON WILLRICH, California Independent 
System Operator Governing Board 

LAURA DOLL, California Independent 
System Operator Governing Board 

DOUG McKEEVER, Division of Juvenile Programs, 
Department of Corrections and Rehabilitation 

TERESA M. TAKAI , Chief Information Officer, 
State of California 



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14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 







INDEX 






Page 


Proceedings 


1 


Governor's Appointees: 




Taken Together: 




MASON WILLRICH, California Independent 




System Operator Governing Board 


2 


LAURA DOLL, California Independent 




System Operator Governing Board 


5 


J. XT -J 

Questions to Both by SENATOR PADILLA re: 




Role of ISO in achieving renewable 




energy targets and the greenhouse 




gas reduction goal 


7 


August 2006 action regarding 


Sunrise 


9 


Opportunities to further agenda 


of renewable energies and reducing 




greenhouse gases other than with 




Sunrise 


14 
17 


ISO governance jurisdiction 


Smart grid technologies 


21 


Questions to Both by SENATOR DUTTON re: 


Redundancy in creating more 




agencies 


26 





111 



1 Question to Both by SENATOR DUTTON re: 

2 Areas that should be examined along 

3 existing transmission system that 

4 have opportunities to add 

5 additional power sources 28 

6 Question to Both by SENATOR CEDILLO re: 

7 Need for directive to structure 

8 collaboration more efficiently 33 

9 Extent to which we are designing 

10 for our capacity to meet the 

11 needs of the economy 33 

12 Witness in Support of Both Appointees : 

13 DELANEY HUNTER, Stirling Energy Systems 36 

14 Motion to Confirm Both Appointees 37 

15 --0O0-- 

16 DOUG McKEEVER, Division of Juvenile Programs, 

17 Department of Corrections and Rehabilitation ... 38 

18 Question by SENATOR DUTTON re: 

19 Number of people in the system 

20 over age 18 45 

21 Question by CHAIRMAN PERATA re: 

22 Vacant Director of Correctional 

23 Education position 48 

24 Statement by CHAIRMAN PERATA 4 9 

25 Questions by SENATOR CEDILLO re: 



IV 



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22 

23 

24 

25 





Court ! s plan not followed 


52 




Exit strategies/reentry strategies . 


. 53 




Budget/cost mental health needs . . . . 


53 




Partnerships with charter schools . . 


. 56 




Experience with trades regarding 






integrating people who are exiting . 


. 58 


Testimony- 


of DAVID WARREN, Taxpayers for 




Improving 
Motion to 


Public Safety 


59 


Confirm 


61 


- -oOo- - 


TERESA TAKAI, Chief Information Officer, 




State of 

Ques 


California 


62 


tions by CHAIRMAN PERATA re: 




Assessment of status of available 




Ques 


technology in California 


64 
66 
67 


Prison system 


Relationship to privacy 


tions by SENATOR CEDILLO re: 




Role in implementing Real ID Act . . . 


. 68 




Standards compared to other states . 


. 69 




Information sharing 


71 




Conformity or compliance language . . 


. 74 


//// 






//// 






//// 







V 



1 Questions by SENATOR DUTTON re: 

2 Cost of IT programs 75 

3 Accountability /responsibility for 

4 cost overruns 77 

5 Internet protocol version 78 

6 Questions by SENATOR PADILLA re: 

7 Status of 311 system 79 

8 Extent to which technology is 

9 incorporated 80 

10 Question by CHAIRMAN PERATA re: 

11 Competing with private sector for 

12 best candidates 82 

13 Witnesses in Support of Appointee : 

14 DAVID DAWSON, State Controller's Office, 

15 21st Century Project 83 

16 Joe Gregorich, American Electronic Association 

17 and Information Technology Association 84 

18 Chris Micheli, Citric Systems and Natoma 

19 Technologies 85 

20 Motion to Confirm 85 

21 - -oOo- - 

22 Vote-Only Item re Confirmation 

23 of Jerilyn Harris 86 

24 Statement by SENATOR PADILLA 86 

25 Proceedings Adjourned 89 



VI 



Certificate of Reporter 90 

APPENDIX 91 

Written Responses to Questions by 
Appointees 



Vll 



1 PROCEEDINGS 

2 CHAIRMAN PERATA : Senate Rules Committee will 

3 come to order. 

4 Call the roll, please. 

5 MS. BROWN: Senator Cedillo. 

6 Dutton. 

7 SENATOR DUTTON: Here. 

8 MS. BROWN: Dutton here. 

9 Padilla. 

10 SENATOR PADILLA: Here. 

11 MS. BROWN: Padilla here. 

12 Battin. 

13 Perata. 

14 CHAIRMAN PERATA: Here. 

15 MS. BROWN: Perata here. 

16 CHAIRMAN PERATA: We have a quorum. 

17 Greg, do you want to introduce the new staff? 

18 MR. SCHMIDT: I'd like to introduce our new 

19 court reporter, who is here a week early because the 

20 draft came in a little bit early, and it's Ina LeBlanc 

21 from Oakland, originally. 

22 CHAIRMAN PERATA: (To the reporter): We're not 

23 paying you for this week. 

24 THE REPORTER: Okay. 

25 (Laughter . ) 



1 MR. SCHMIDT: This is basic training, and 

2 she'll be with us for the next 35 years. Or some of us. 

3 (Laughter . ) 

4 CHAIRMAN PERATA : All right. We have four 

5 items -- or, actually, five on the agenda today. And 

6 we'd ask Laura Doll and Mason Willrich to come up first 

7 together. 

8 MS. DOLL: Thank you. 

9 CHAIRMAN PERATA: And you're the president of 

10 the board? 

11 MR. WILLRICH: I'm chair, Senator Perata, yes. 

12 CHAIRMAN PERATA: You get to go first. 

13 Meet the new incoming member of the Energy 

14 Commission. 

15 MR. WILLRICH: Yes. Senator Perata, Senator 

16 Cedillo -- I mean -- I'm sorry, Padilla -- and Senator 

17 Dutton. It's a pleasure for me to appear before you 

18 today regarding my reappointment to the California 

19 Independent System Operator Governing Board. 

20 I was first appointed to the board in 2005 and 

21 have served as board chair since June 2006. Regarding 

22 my qualifications and experience, my career includes 

23 service in the U.S. Air Force, in the United States 

24 government, in academia as a law professor, in the 

25 energy industry as an executive of PG&E, and as a 



1 

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23 

24 

25 



partner in a venture capital firm. 


Presently, I devote my working experience 


exclusively in nonprofit and public service activities. 


I believe my service as chair of the CAISO board is my 


most important responsibility. I joined the board in 


2005 contemporaneously with the arrival of Yakout 


Mansour as chief executive. 


With the board's guidance, CAISO 's operating 


costs dropped about 25 percent. CAISO also strengthened 


its budgeting and planning processes, including the 


introduction of a five-year strategic plan and a 


ten-year transmission expansion plan. 


CAISO' s core commission is to provide highly 


reliable electric transmission services. We're proud of 


our record in fulfilling this mission under very 


difficult conditions, including record demands during 


2006, and maintaining transmission service during the 


extensive fires in 2007-2008. 


Achieving CAISO' s core mission also requires 


timely expansion of California's transmission grid. 


From 2005 through mid-2008, CAISO' s board approved 


approximately 4.2 billion of transmission projects. 


As construction of these projects, which 


include Sunrise and Tehachapi, is completed, these 


projects will provide access to California's abundant 



1 renewable energy resources, as well as increase 

2 reliability and economic benefits for California's 

3 consumer. 

4 CAISO faces challenges. The most immediate is 

5 to launch successfully the market redesign and 

6 technology upgrade program. And this complex software- 

7 modernization project will provide the platform of a 

8 robust and transparent wholesale electric market which 

9 ensures against market manipulation. 

10 Yesterday, following extensive discussions in a 

11 public meeting with CAISO ' s stakeholders, the board 

12 directed CAISO management to prepare to file MRTU 

13 readiness certification on December 30th for an MRTU 

14 go-live date of March 1, 2009. 

15 A different challenge CAISO faces is to 

16 integrate renewable energy projects successfully into 

17 the transmission grid at a level sufficient to achieve 

18 California's 20 percent renewable portfolio standard and 

19 the 33 percent goal that Governor Schwarzenegger 

20 established in his November 17th executive order. 

21 As I said in my November 21st letter to 

22 Senators Perata, Steinberg, and Kehoe , CAISO is fully 
committed to playing an enabling role in achieving 
California's ambitious renewable energy goals. 

25 Thank you, and I'll be happy to answer any 



1 questions which you have. 

2 CHAIRMAN PERATA : Thank you. 

3 MS. DOLL: Shall I go next? 

4 CHAIRMAN PERATA: Please. Thank you. 

5 MS. DOLL: Good morning, President Perata, 

6 members of the Committee. It's a great honor to be 

7 before you today. 

8 I've served on the board a much shorter time 

9 than Mason, since just last January. I certainly have 

10 gained a deeper appreciation of the complexities of the 

11 electric system since that time. 

12 We're fortunate, of course, that the system has 

13 been able to perform well despite fires, maybe a couple 

14 of earthquakes, peak demands, and other operating 

15 challenges; but you all are well aware that those 

16 conditions can change very rapidly. 

17 You rightly expect the ISO to operate the 

18 transmission system efficiently and without 

19 discrimination, but increasingly the ISO is called upon 

20 to go well beyond that and to be actively involved in 

21 supporting longer-term state policy objectives. I want 

22 to assure you that those objectives are a key focus of 

23 our board, as Mason has already noted. 

24 Every one of our board meetings includes 

25 actions around at least three high-priority issues. 



1 One, integrating significant amounts of renewable energy 

2 and demand responsive load into the operation of what 

3 many people are now calling a new low-carbon grid. Two, 

4 expanding and modernizing the way we operate our 

5 electricity market. Three, promoting infrastructure 

6 developments that will support growth and especially 

7 allow renewable energy to get into our system. 

8 Among our challenges in advancing these 

9 objectives are finding ways to engage other agencies and 

10 stakeholders in openly considering these issues. 

11 Effective alliances and collaboration with the 

12 California PUC, with the Energy Commission, Cal EPA, 

13 FERC, and certainly not last, the legislature, are 

14 critically important and are something that I and other 

15 board members not only monitor but support 

16 enthusiastically. 

17 I've worked in and around the electric industry 

18 for about 30 years now, including 15 years as an 

19 executive with a large municipally owned electric 

20 utility. I've served in public and private sectors, 

21 have been involved in a very wide range of electric 

22 system activities. I've been involved in building solar 

23 energy projects, designing and running demand-side 

24 response programs, citing electric transmission lines, 

25 and long-range planning. 



1 During my recent tenures in Sacramento and then 

2 in San Francisco, I had the real privilege to 

3 participate in developing and implementing California's 

4 Energy Action Plan. 

5 I look forward to continuing to build on these 

6 previous partnerships and relationships with other state 

7 agencies and to working with the legislature to ensure 

8 that our system is capable of supporting and advancing 

9 all of our critical environmental policy objectives. 

10 Thank you. 

11 CHAIRMAN PERATA: Thank you. 

12 SENATOR PADILLA : Thank you. First of all, let 

13 me apologize. I know I had a meeting scheduled 

14 yesterday afternoon with the two of you, and I got 

15 called away to some budget discussions, and I certainly 

16 hope today's hearing is a lot more productive than some 

17 of the conversations we had yesterday. 

18 You both jumped out in front with the big issue 

19 we were going to talk about yesterday, and we will talk 

20 for some time this morning, and that is the role of the 

21 ISO in this conversation of achieving the renewable 

22 energy targets that legislature and the governor have 

23 set and are seeking to raise, as well as the greenhouse 

24 gas reduction goal that the legislature and governor 

25 have se t . 






1 I appreciate what you said in your opening 

2 comments, but may I get maybe a couple of to- the-point , 

3 succinct comments or observations on that? 

4 MS. DOLL: Go ahead. 

5 MR. WILLRICH: We -- As I mentioned in my 

6 statement, and certainly in the letter I addressed to 

7 Senator Perata and others, we have been fully -- since 

8 I've been on the board, fully supportive of the 

9 renewable energy policies of the state, and we will 

10 continue to support those policies, including the 

11 33 percent goal, as well as the 20 percent goal. 

12 My understanding, as far as achieving the 

13 20 percent goal, is that it is lagging in terms of 

14 getting there. 

15 SENATOR PADILLA: You're absolutely right. 

16 We're slow in getting to the 20 percent goal. There's 

17 been legislation in previous years and now a governor's 

18 executive order looking beyond the 20 percent goal to 

19 establish a 33 percent goal by 2020. 

20 MR. WILLRICH: Right. 

21 SENATOR PADILLA: To get there, both to the 20 

22 and the 33 percent, we need all hands on deck of the 

23 legislature, to the governor, to utilities, private and 

24 municipally owned, to the PUC, to you all. 

25 So I guess my question, to be more specific, 



1 is: What specific role do you see yourself playing in 

2 supporting these goals? 

3 MR. WILLRICH: First of all, we have done 

4 extensive studies with the cooperation of the California 

5 Energy Commission regarding how to achieve the 

6 20 percent goal. 

7 We have also conducted a conceptual study for 

8 the 33 percent goal. And we have, in addition to 

9 that -- I mentioned the Sunrise project. And CAISO, our 

10 board, approved that project. I believe it was August 

11 of 2006. 

12 And we have since then participated extensively 

13 with the citing authority that the PUC has in very 

14 protracted administrative law proceedings to determine 

15 the location and to determine other aspects of that 

16 project. And my understanding is that the PUC is 

17 hopeful of reaching a decision in 2008, December. 

18 SENATOR PADILLA : Let's talk about the 

19 August 2006 action first, and then we'll come back and 

20 talk about the PUC. 

21 MR. WILLRICH: Yes. 

22 SENATOR PADILLA: In the August 2006 action, 

23 was the opportunity leveraged in ISO saying thumbs up to 

24 Sunrise to ensure or maximize Sunrise's benefits 

25 specifically for the transmission of renewable energies? 



1 MR. WILLRICH: Yes. 

2 SENATOR PADILLA : How so? 

3 MR. WILLRICH: At that time, the Imperial 

4 Valley Irrigation District was a partner in that 

5 project, along with Citizens Energy. And the main 

6 thrust of looking at that project was precisely to be 

7 able to access a renewable resource- rich area in the 

8 Imperial Valley. And that was a strong basis for 

9 approval . 

10 Now in addition to that -- 

11 SENATOR PADILLA: Basis of approval or 

12 condition of approval? 

13 MR. WILLRICH: I don't quite understand the -- 

14 SENATOR PADILLA: Basis for approval could be 

15 owed, that sort of makes sense, to try to improve the 

16 project, versus actually building the condition of the 

17 approval . 

18 MR. WILLRICH: We don't condition quite -- at 

19 least I'm avoiding that word, because we do not have the 

20 authority to just say this, that, and the other thing in 

21 terms of this kind of project. 

22 What it does, if you let me go on one step 

23 further, that line is in addition to an access to a 

24 resource- rich area for renewable energy, provides 

25 substantial reliability benefits for the City of -- for 



10 



1 the City of San Diego and Southern California, which has 

2 really difficult issues in terms of overall transmission 

3 reliability. 

4 So I guess I would not use the word "condition" 

5 that -- on the other hand, because from the point of 

6 view of the citing of the line, that's in the California 

7 Public Utilities Commission jurisdiction. 

8 And furthermore, in terms of the supply side, 

9 as far as development is concerned, as you know the CPUC 

10 conducts a yearly auction for the procurement side of 

11 the utilities in terms of where they procure and so 

12 forth. They really have the major responsibility in the 

13 state setup now to connect up or to make sure that the 

14 development does occur in those resource-rich areas. 

15 But our planning is aimed at identifying those 

16 resource-rich areas and enabling, through transmission, 

17 that to happen. But we do not order projects to be 

18 under supply contracts to particular developers in these 

19 resource- rich areas. 

20 There are lots of them in our queue of 

21 renewable energy projects, and we have accelerated -- 

22 taken steps to accelerate dealing with that queue. We 

23 have also gotten approval from the federal authorities 

24 for an innovative financing scheme to enable the 

25 transmission grid to extend out there to these various 



11 



1 areas. And, in fact, that sets a national precedent, 

2 what we put together for financing. 

3 So I would say that CAISO views itself as an 

4 enabler, but we are not in the business of mandating -- 

5 generating project development. 

6 Let me go one step further. With this project 

7 I mentioned, MRTU, when that is enabled and goes live, 

8 what it will do is to identify the optimum locations for 

9 additional investment in generation. So I don't want to 

10 resist the word "condition, " but I want to be very 

11 careful about my vocabulary. 

12 SENATOR PADILLA: I understand. The reason I 

13 asked is because in my understanding, the PUC might 

14 consider being more aggressive in using the term 

15 "condition" in their consideration of the citing of 

16 Sunrise. And if the ISO has already acted on its piece 

17 of it, my understanding is also that you still have an 

18 opportunity to lay in to comment on, if you will, on the 

19 PUC deliberation. 

20 MR. WILLRICH: We participated very actively in 

21 that whole protracted proceeding for two years -- over 

22 two years and with extensive staff support to get the 

23 PUC into some mode where they would reach a decision. 

24 Frankly, I have been, and CAISO staff knows, 

25 and I think that Governor Doll supports me in this, 



12 



1 we've been quite impatient with the progress of the 

2 PUC disposition. And in order to achieve the 

3 development which we want to see happen in Imperial 

4 Valley, the leading edge, really, in the chicken and egg 

5 is to get transmission constructed. 

6 And so that at that point, as far as 

7 development is concerned, it's going to really occur in 

8 a much -- it will really be facilitated, because those 

9 who are developing these projects, the financiers, would 

10 see that there is transmission that's going to be 

11 available to enable that project. But transmission -- 

12 And that's one of the things we're working on with the 

13 renewable energy transmission initiative, which is the 

14 statewide process. 

15 Once again, my concern is that it's not going 

16 fast enough, but that's a very coordinative view of 

17 trying to optimize a transmission plan to bring in the 

18 resources required for achieving these renewable energy 

19 targets . 

20 SENATOR PADILLA: Let me address the next 

21 question to Governor Doll. 

22 MS. DOLL: Okay. 

23 SENATOR PADILLA: Let me ask the question. Say 

24 what you're going to say and then transition into the 

25 answer. 



13 



1 We've talked a little bit about Sunrise, and 

2 others have talked about -- more about Sunrise. You 

3 mentioned in your opening comments that every meeting 

4 there's multiple opportunities as you take actions to 

5 further the agenda of renewable energies and reducing 

6 greenhouse gases . 

7 Can you give me some examples other than 

8 Sunrise where you have been presented with that 

9 opportunity and how you seize that opportunity. 

10 MS. DOLL: Yes, but let me back up for a minute 

11 in the context of this discussion. 

12 I also mentioned I've been in and around this 

13 industry for 30 years, which is amazing to me, but I'm 

14 mindful of how much things have changed in that period 

15 of time . 

16 It used to be that utilities knew what their 

17 load was and identified where it would be a good place 

18 to put generation and build transmission to it. We're 

19 obviously in a completely different world today and have 

20 been for quite sometime. 

21 In California, I think there are three main 

22 focuses for renewable transmission. The first is: 

23 Where are those sources of renewables? Wind in the 

24 Tehachapi, sun in the desert is grossly oversimplified 

25 examples. And then you start to get into a 



14 



1 chicken-and-egg thing. Do you build the transmission 

2 out there and hope projects will come together; or do 

3 you wait for the projects to be built? There's always a 

4 timing mismatch and terrible lag when you're talking 

5 about infrastructure like this. 

6 So the ISO has taken the approach, as Mason 

7 said, of being very involved in state efforts to really 

8 try to identify what are the most potentially productive 

9 areas for renewable energy. 

10 The Mojave Tehachapi is the other example that 

11 I would put on the table. The CEC identified probably 

12 ten years ago that the Tehachapi had, as I recall, over 

13 4,000 megawatts of capability, maybe more than that now 

14 with the emergence of new high-efficiency wind 

15 generators. And indeed people were interested in 

16 building systems out there, but there was no 

17 transmission. It wasn't a simple upgrade. You know, an 

18 entirely new transmission network had to be built out to 

19 that. 

20 Well, again, in the old days, a generator would 

21 be responsible for most of the cost of getting that 

22 transmission out there. You can't possibly do that if 

23 you're just building one, you know, reasonably sized 

24 wind farm . 

25 So the state as a whole -- the ISO was very 



15 



1 involved in this, Energy Commission and PUC -- came 

2 together and looked at how could new financing -- a new 

3 financing structure be put in place, one, to guarantee 

4 that, in this case, Southern California Edison could do 

5 the long-range planning and design of that line and be 

6 sure that they could recover the cost from it. 

7 That took -- That was really a leadership role 

8 on the ISO's part, working, again, in conjunction with 

9 the Public Utilities Commission, because they're 

10 ultimately responsible for the Edison rate payer impact. 

11 It took many years to get these pieces 

12 together, but today we are right on the cusp of having 

13 transmission built out to the Tehachapi to allow this 

14 wind. 

15 SENATOR PADILLA: And I appreciate the 

16 information that you're sharing, because it certainly is 

17 both complicated and complex, the chicken- or- the - egg 

18 thing as you described. 

19 You build a transmission line, and that's a 

20 further incentive for the renewable development projects 

21 to come forward, or what comes first. 

22 MS. DOLL: Right. 

23 SENATOR PADILLA: I guess the point is: How do 

24 we all but guarantee, if not guarantee, that we're not 

25 sitting here a generation from now after we've gone 



16 



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through all the hoops of 


supporting the transmission 


extension only to find renewable projects that 


did not 


happ 


en and dirtier burnin 


g power sources that 


did? 




MS. DOLL: Well, 


again, we all have a 


very 


important role to play in 


this in terms of try 


ing to 


fulf 


ill the legislative o 


bjectives, which are 


numerous 


from 


the renewable portfo 


lio standards, to the 


PUC s 


side 


, long-term resource 


adequacy, including renewables . 




And now with AB 


32, you know, another 


layer 


of - 


- I would -- I don't 


know what the word that ■ s 


stronger than "incentive" 


is, but really a req 


uirement 


that 


the way we procure and distribute and use 


energy in 


Cali 


fornia is indeed goin 


g to be cleaner than 


it was 


20 y 


ears ago . 








I think, frankly 


, it's inconceivable 


that 


util 


ities would be consic 


ering dirty generation. I 


thin 


k there are a lot of 


restrictions in place 


already 


for 


that . 








Now there ■ s some 


that are still using 


power 


from 


contracts that they 


had a long time ago. 






SENATOR PADILLA: 


Let me ask a brief 


governance 


question, because in previous hearings, confirmation 


hearings, for ISO governance jurisdiction and 


who 


reports to who has become 


a topic of conversat 


ion . I 


hear 


much more of an acce 


ptance, and I'm hopin 


g this 



17 



1 formal acceptance on the part of you about the State's 

2 oversight and responsibility. I don't hear you two 

3 hiding behind, "Oh, we're given our directives by FERC . " 

4 So is that accurate? 

5 MR. WILLRICH: FERC -- Federal policy does not 

6 have a renewable portfolio standard. State policy 

7 drives, as of the moment, the resource mix for the 

8 state. And of course that state, our state, is embedded 

9 in a much larger Western Electric Coordinating Council, 

10 so that from the point of view of California, we do need 

11 to take into account the whole West. 

12 But from the point of view of ISO, at least 

13 since I've been on the board, state policy is what 

14 drives particularly a renewable portfolio standards and 

15 the application and realization of those standards. 

16 If I could just make one additional comment 

17 about how do we make sure that this development occurs 

18 at the resource level, number one, the projects, 

19 whatever, whenever, in terms of the development projects 

20 at the end of the line, they are going to have to be 

21 financeable. And that is -- We're in a totally 

22 unprecedented, in my lifetime, environment, so that we 

23 all have to be very realistic about that. 

24 Now, I happen to believe that a long-term 

25 utility contract for the output from a very good 



18 






1 renewable project, that is something which is, even in 

2 the circumstances today, properly constructed in terms 

3 of the contractual relationship, and with the Federal 

4 Energy Regulatory Commission and their encouragement 

5 incentive structure for transmission development, that 

6 that combination would still be financeable from the 

7 private sector. 

8 SENATOR PADILLA: Let me get back to some 

9 finance questions in a minute, but the governance point 

10 I was trying to make -- If you look at the letter of 

11 ISO, unlike others involved with energy in our state, I 

12 think your specific mandate is geared to reliability and 

13 safety; is that correct? 

14 MR. WILLRICH: Yes. 

15 MS. DOLL: Um-hmm. 

16 SENATOR PADILLA: So given your acknowledgment 

17 here in this committee, and I think our desire to, in 

18 addition to reliability and safety, look at a renewable 

19 agenda, look at a climate -change agenda, would it or 

20 would it not be appropriate, helpful, to update, if you 

21 will, amend, if you will, your charge from exclusively 

22 reliability and safety to incorporate these other policy 

23 directives? 

24 MR. WILLRICH: Senator Padilla, if you look at 

25 our strategic plan, you will see that embodied in the 



19 



1 five-year plan is just what you're suggesting. We 

2 believe and are fully aligned with state renewable 

3 energy and climate change. 

4 SENATOR PADILLA: I appreciate that. I really, 

5 really do, but sooner or later we're going -- Most of 

6 the time we're going to agree, but heaven forbid we 

7 sometimes or once in a long while see something on a 

8 slightly different page, and we get into a fundamental 

9 discussion of the core mission. Some may point to your 

10 core mission of reliability and safety exclusively. 

11 I think we ought to see this unprecedented 

12 time, not just given Wall Street, but given the 

13 national/ international attention to climate change, to 

14 possibly codify the equal missions of reliability, 

15 safety, along with a green energy mission. 

16 Your thoughts? 

17 MR. WILLRICH: That's something for you all to 

18 consider, and in -- If the statute is modified or 

19 something like that, if that's what you're suggesting, 

20 that's something for the legislature to consider. 

21 SENATOR PADILLA: You would have no opinion on 

22 that? 

23 MR. WILLRICH: Well, I would not want to -- I 

24 want to support and the ISO wants to support enabling 

25 the state policy. 



20 



1 Now, if we get additional authorities from the 

2 legislature, obviously I'd want to consult with my 

3 colleagues on the board and the rest; but as far as my 

4 own personal view on enabling the policy, it -- from my 

5 point of view, I think we're going pretty full bore 

6 without legislation but in support of other state 

7 agencies that have the key responsibilities in -- in 

8 terms -- so far in terms of achieving those portfolio 

9 standards . 

10 SENATOR PADILLA: Ms. Doll? 

11 MS. DOLL: I agree, and frankly I don't know 

12 enough about the details of the enabling documents for 

13 the ISO, but that's certainly something we can look at. 

14 As Mason says, we're operating -- in our view, we're 

15 operating that way right now. 

16 SENATOR PADILLA: Another specific area of 

17 opportunity, if you will, to meet the safety/reliability 

18 current mission of ISO along with our renewable 

19 greenhouse gas reduction goals, to what extent have you 

20 all been briefed on smart-grid technologies, or if 

21 you're familiar with smart grid, can you talk with me 

22 about any actions to help further implementation of 

23 smart grid here in California? 

24 MS. DOLL: I'll start, and then Mason will pick 
up. 



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Smart grid is one of those terms that is kind 


of 1 


oosely used, I would 


say, and in my experience it's 


been 


associated more at 


the distribution level, that is, 


the 


lines that go into our homes and businesses and 


often attach to meters. 


You know, we're still using, 


most 


of us, meters that 


would look familiar to somebody 


who 


was in the electric 


utility industry a hundred years 


ago . 








But now - - And 


certainly the PUC and the Energy 


Commission have been ver 


y involved in pushing more 


advanced metering techno 


logies that allow two-way 


communications from the 


customer's load back to the 


util 


ity operating center 


And that can do lots of 


thin 


gs , including helpin 


g customers manage their own 


use , 


and something I'm especially interested in on the 


demand responsive load v\ 


'here we can all be part of 


help 


ing to shave the State's peak through changing our 


own 


usage patterns . So 


there's quite a bit happening 


one 


could categorize as 


smart-grid initiatives in 


Cali 


f ornia . 






Relative to the 


high-voltage transmission side 


that 


the ISO is involved 


i in more, not the distribution- 


leve 


1 stuff, I know that 


there are -- there are some 


pretty big improvements 


coming in in materials and, 


again, communication systems among the key elements of 



22 



1 the transmission grid. But personally, I'm not aware 

2 that the ISO has taken any specific action to, you know, 

3 especially facilitate that. 

4 MR. WILLRICH: We have -- This is one of my 

5 favorite subjects. I'm going to do it in two parts, one 

6 is the ISO, but then I would like to go on to mention 

7 something else. 

8 In terms of CAISO, we have established a lab 

9 that is a demand-response lab that demonstrates realtime 

10 the possibilities for programming dishwashers and other 

11 things on the customer's side of the meter. So that is 

12 up and running. 

13 We've also just recently, going back up the 

14 grid, deployed some battery technology to see how that 

15 works, because storage is key in terms of bringing in 

16 intermittent resources, which renewables are. They have 

17 some characteristics that are difficult, but not 

18 impossible, but that really require integration to keep 

19 the load balanced and everything matched up. 

20 So storage is a key technology that could be 

21 deployed in strategic parts of the grid and that we are 

22 actively demonstrating -- beginning some demonstration 

23 pro j ect s . 

24 Now, if you take smart grid, you know, how 

25 smart can it get? This is a different role, but I've 



23 



1 been asked to co-chair a meeting for the National 

2 Academy of Sciences and Engineering, the Board of 

3 Environmental -- the bureaucracy in Washington, in a 

4 workshop on just this subject, transmission and 

5 distribution delivery system, and we have gathered 

6 together about 25 people who are really from all over 

7 the country and focusing on just that, how to move that 

8 forward. 

9 My impression, standing back from it all, is 

10 that the main issue is going to be deployment, not a lot 

11 of technology that is not available now. 

12 And as you know, the utilities are rolling out 

13 automated metering systems and so forth. The question 

14 for the state is going to be: Will state policy evolve 

15 so that all that functionality could be turned on, 

16 because that is designed to enable exposing consumer 

17 markets to realtime prices, and then with realtime 

18 prices in mind, they can program their consumption. And 

19 I'm talking about skyscrapers as well as individual 

20 residences . 

21 And down the road all that can be done, but I 

22 suspect there's going to be a lot of push and pull in 

23 terms of state policy going down that road. And CAISO 
2. ; \ can play a very important role in understanding, 
2 5 enabling all this to happen. 



24 



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21 

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25 





But I think there ' s going to be some heavy 


lifting 


in other parts of the policy making in 


California to really get all the way where I would like 


to see 


the country be, which is end to end smart grid. 




SENATOR PADILLA: Okay. Thank you. 




Clearly, Senator Perata, the appointees before 


us have 


a pretty good grasp of where we're all trying to 


go, lik 


e Mr. Willrich said, not just here in California, 


but if 


we indeed lead the country, where the country 


will en 


d up going . 




So I'll take your word as far as your 


commitment goes to the legislature's outlined priorities 


of renewable energy sources and greenhouse gas emission 


reductions; but clearly we have a lot of work ahead, and 


I hope 


the conversation here today isn't the last time 


we're intimately cooperating with one another. 




MS . DOLL : Thank you . 




SENATOR PADILLA: Thank you. 




MR. WILLRICH: We look forward to that. 




SENATOR DUTTON: Just a couple. 




Your background's pretty extensive in the 


energy 






You were with PG&E a number of years, so you're 


pretty 


familiar with that side of it, the investor-owned 


utility side and trying to meet the demands of the 



25 



1 

2 
3 

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5 

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7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

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18 

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21 

22 

23 

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public and so forth. 




MR. WILLRICH: I had two roles at PG&E. One 


was within the utility, and the 


other one was 


establishing some unregulated independent power producer 


companies . 




SENATOR DUTTON: Okay. 


And then, Laura, on 


your side you actually spent qu 


ite a bit of time with 


the Public Utilities Commission 


, so you kind of have an 


inside knowledge of what's happ 


ening within that 


organization as well, right? 




MS. DOLL: Yes, sir. 


It was three years, 


really, in the regulatory arena 


That was very 


different for me, because my background had been in the 


municipal electric utility side 


• 


SENATOR DUTTON: Seems 


to me like one of the 


challenges we have right now -- 


I think everybody wants 


to see a way to come up with a 


reliable, environmentally 


sensitive energy policy and supply, and certainly if 


we're going to sustain any kind 


of strong economic 


growth for the future of California, we have to come up 


with some kind of reliable, aff 


ordable energy supply and 


a way to get it there . 




I'm starting to get a 


little concerned, though, 


because it just seems to me with all the horrendous 


amount of red tape I constantly 


hear about, whether 



26 



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14 

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17 

18 

19 

20 

21 

22 

23 

24 

25 



you're trying to do renewables or you're trying to do a 


peaker plant to help with those intermittent problems 


and so forth, it almost seems to me like we keep wanting 


to create more and more agencies, and it's like the more 


we create, the less we get. So are we -- Every time we 


turn around, somebody wants to create a new agency. 


In the bigger scheme of things, do we have a 


lot of redundancy going on? Do we have a lot of -- Is 


this what really is kind of stopping the process or the 


progress is because maybe there's too many cooks 


involved with fixing the meal? 


MS. DOLL: You can take that one. 


SENATOR DUTTON : Your personal opinion. 


MR. WILLRICH: In my experience, and it's 


typified by the length of time that Sunrise has been 


considered, and if California is going to meet those 


targets, there needs to be an understanding and some 


changes in that overall process, not adding but rather 


streamlining decision-making about how to get there. 


And I suspect that the same things could occur 


in the near future at the federal level where there will 


be an understanding that, you know, the federal level 


needs to get on board, and it's just not a 


state -by- state kind of situation in relation to 


renewable development . 



27 



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13 

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18 

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20 

21 

22 

23 

24 

25 



And California being in a 


leadership role could 


have a big influence so that chang 


ss that are made in 


California to streamline its -- an 


d I'm not trying to 


deal anyone out of the process, but rather to get it 


inclusive, but at the right time, 


and then get a 


decision made, you know, limit it 


where there is closure 


on a decision so you can get steel 


in the ground, as 


they say; that for a whole variety 


of infrastructure 


issues that California faces if it 


' s going to innovate 


fundamentally, it's not technology 


that ' s a drag or that 


we need new technology, it's that 


we need to really get 


on with scaled deployment is what 


we really know well 


how to do and with best practices, 


technology and 


policy . 




SENATOR DUTTON: It seems 


to me that the 


existing transmission system would 


appear to be a little 


bit underutilized. It would seem 


to me within the 


existing lines that exist, there's 


opportunities where 


we actually could develop more sources of power of 


various types and so forth along the existing 


transmission system instead of try 


ing to -- instead of 


constantly going out and trying to 


take on the 


challenge -- not that we don't nee 


d more transmission, 


but as soon as you build more transmission systems, then 


you open up lines of development. 


And there ' s other 



28 



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14 

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16 

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19 

20 

21 

22 

23 

24 

25 



people 


that are really concerned about too much sprawl. 




And so it would seem to me that if people don't 


want to 


see the sprawl and they want to be able to see 


more smart growth, I guess, you would want to try to 


maximize your utilization of the existing transmission 


system . 






Based on what you've seen, is there areas that 


we shou 


Id be looking at along the existing transmission 


system 


that would have opportunities to add additional 


power sources? 




MS. DOLL: Well, I believe there are, and 


that ' s 


an area that I'm working in conjunction with the 


Energy 


Commission, because they really do the statewide 


forecast of how much energy do we need, you know, where 


do we think generation should be cited. They have 


responsibility for generation citing. 




SENATOR DUTTON : That goes back to what I was 


saying 


a little earlier. You're actually in charge of 


managing the transmission system. 




MS. DOLL: We do the long-range planning for 


the transmission system, but the load forecast and 


issues 


about, you know, types of generation and so 


forth, 


it's really done in conjunction with the Energy 


Commission . 




If I could go back to your first question, 



29 



1 because I think it's a really good one. 

2 I hope nobody is talking about new energy 

3 agencies in California, but eight years ago when I came 

4 to Sacramento, the ISO and the PUC and the Energy 

5 Commission did not -- the leaders of those agencies did 

6 not routinely meet, the three of them. 

7 And something that happened at that time in the 

8 wake of the crisis was a commitment to a lot more 

9 coordination. Didn't need any new laws to get the 

10 agencies to talk together and jointly plan. And that is 

11 absolutely continuing now. The Cal EPA and the Air 

12 Resources Board, of course, are the fourth leg of that 

13 particular, you know, focus. 

14 So I think it's really appropriate to continue 

15 to drive for that kind of cooperation, and I guess 

16 that ■ s . . . . 

17 MR. WILLRICH: If I could just add a slightly 

18 different perspective. 

19 So I mentioned this MRTU software upgrade, and 

20 when that is -- One of the major reasons for this is to 

21 make the whole grid more efficient and more transparent 

22 in terms of identifying locations where there is 

23 congestion on the grid, that then we can spot projects 

24 to relieve that congestion. 

25 On the other hand, it's going to identify 



30 



1 locations where additional generation -- and to give the 

2 whole community of development developers the best 

3 signals as to where to optimize generation. 

4 Now, philosophically -- not philosophically, 

5 but if you stand back, electricity infrastructure, 

6 60 percent of the investment is in generation; 

7 40 percent is in distribution; 10 percent in 

8 transmission. And yet when you have congestion, it 

9 really imposes costs, both reliability and economic 

10 costs, on California, so that if you're going to -- if 

11 you're going to -- 

12 The one place that is -- the consumer doesn't 

13 suffer much is when you have enough transmission. And 

14 so that in terms of investment, you get a lot of bang 

15 for the buck, if you do it right. And with MRTU and 

16 these other improvements, and the way we're planning the 

17 grid, is right down the line with, I think, where you're 

18 headed, that we're going to get more and more 

19 efficiency. 

20 And that would include, for example, with 

21 existing transmission lines, to re-conduct and to 

22 upgrade and not have to go through the agony of doing 

23 another line, because nobody likes looking up and see 

24 these power lines go ahead. 

25 SENATOR DUTTON : I guess where my concerns are 



31 



1 is -- I don't really have any more questions. 

2 Where I'm heading right now, obviously, it's no 

3 big secret. California's got a huge deficit problem and 

4 so forth. And I think it behooves all of us to take a 

5 look at how we can do things better, more efficiently, 

6 more effectively. It doesn't mean it necessarily has to 

7 be bigger. It just means we have to learn how to do it 

8 better, more smart, more efficiently, which is what, to 

9 me, the whole thing with the admission of AB 32, 

10 greenhouse gases, reductions, and everything else, is 

11 try to get us to how we do it more effectively, how we 

12 do it more efficiently. 

13 I was kind of hoping we'd be heading in the 

14 same direction here, but that's not what I'm seeing 

15 happening. I've seen it grow just like with 

16 implementation of AB 32 and so forth. Now we're getting 

17 the Air Resources Board and everybody else involved in 

18 energy, and it just seems like we re not really creating 

19 that central area. 

20 So if you do have any ideas, thoughts, or 

21 suggestions in how we can do this thing better, smarter, 

22 and more efficient, and certainly help save money for 

23 the State of California and the rate payers, I would be 

24 appreciative. So thank you. 

25 MS. DOLL: Thank you. 



32 



1 MR. WILLRICH: Thank you. 

2 CHAIRMAN PERATA : Are you still in a different 

3 time zone? 

4 SENATOR CEDILLO : I'm way in a different time 

5 zone . 

6 CHAIRMAN PERATA: Not useful here. 

7 SENATOR CEDILLO: Just a few thoughts. 

8 Going along the lines and kind of the 

9 intersection between Senator Dutton and Senator Padilla, 

10 I'll just -- The question I just asked my staff is: Is 

11 there a need for some other type of directed 

12 collaboration that would create more efficiencies? 

13 It's puzzling that -- We're pleased, but it's 

14 puzzling that it took a crisis for these agencies to 

15 interface, but is there a need for some directive to 

16 structure collaboration more efficiently? 

17 The real question I think is really not so 

18 much -- We want efficiencies from government, but, 

19 really, to what extent are we designing for our capacity 

20 to meet the needs of the economy? Because I think 

21 that's the real question. We are a leader in the world. 

22 The mandates, the directives, the legislation are 

23 models; but at the end of the day, the rubber meets the 

24 road of whether or not we are effective enough to meet 
the needs of the economy and to drive the economy, if 



33 



1 you will. I'm interested in your thoughts on those two. 

2 MS. DOLL: I'll start with two things. First, 

3 the -- I think the legislature has been quite clear, 

4 frankly, in the last eight years that agency 

5 collaboration must continue. So it's gone beyond a 

6 nice-to-have, but it is really, I believe, fundamental 

7 now to the way the agencies are operating together. And 

8 AB 32 was, you know, the -- one of the most recent 

9 examples of that where the PUC has certain roles and 

10 responsibilities and so forth. 

11 But the other part of this that Mason has 

12 already mentioned is, for the first time ever, after we 

13 get this new system in place called MRTU, there's going 

14 to be a lot better and more transparent -- that's an 

15 overused word -- information available to the state. 

16 And to address some of Senator Dutton's issues as well, 

17 you know: Where are the needs, and what are the costs 

18 associated with those needs? What are the pricing 

19 impacts? 

20 I mean, it's a lofty goal, but it really is 

21 much more achievable once there is more granular 

22 information about what's happening around the state. 

23 So, frankly, I think that's one of the most 

24 encouraging new things that will come out of the ISO for 

25 its part in this overall state planning scheme. 



34 



1 MR. WILLRICH: In terms of the economy, of 

2 course we're in this question now about the strength of 

3 the economy nationwide. But if you were going to turn 

4 that around, and as it turns around, first of all, I 

5 would start off with energy efficiency and wringing 

6 energy efficiency out of the energy consumer portion of 

7 all this, and that goes for driving cars as well as 

8 buildings and residential structure retrofitting. 

9 And there is -- My impression is the California 

10 utilities, the investor-owned utilities and the 

11 municipally owned, have strong efficiency programs 

12 underway with their various consumer groups. 

13 I'm interested to see how -- whether that's 

14 mostly, you know, wide and not deep, or whether we're 

15 going in and really able to mine out the full 

16 opportunity on energy efficiency within the existing 

17 infrastructure on the consumer side. 

18 Then you come back up, as far as the economy 

19 goes, and if and when, and it will happen, that we have 

20 a major renewable energy industry that grows up with a 

21 lot of it in California, that's going to be a source of 

22 what I think is going to turn this situation around, is 

23 when employment, jobs are created that are going to be, 

24 you know, really good work for all kinds of people in 

25 California -- and this would be true in other parts of 



35 



1 the country as well -- that will lead in the recovery 

2 process . 

3 So that's an excellent question, and ISO -- Let 

4 me just finish off with ISO. I want to come back to the 

5 fact that we have, on my watch with really good 

6 leadership on that, we have restructured, reorganized, 

7 leaned out and got a really wonderful high-performance 

8 team there in place to do a much more -- and also this 

9 project and all this happening in the way of how we 

10 operate the wholesale markets -- that we are more 

11 efficient, and we're going for increasing efficiency all 

12 the time . 

13 SENATOR CEDILLO : Okay. 

14 CHAIRMAN PERATA : Anybody in the audience want 

15 to come up and speak on behalf of either? We'll let you 

16 represent everybody. 

17 MS. HUNTER: Awesome. Good morning, Members. 

18 Delaney Hunter on behalf of Stirling Energy Systems. 

19 We're a renewable solar developer with two large 

20 projects, one in the Mojave Desert:, one in the Imperial 

21 Valley. 

22 We need transmission. We need leadership, like 

23 Mason and Laura, and we're pleased to support their 

24 nominations. 

25 CHAIRMAN PERATA: Thank vou . 



36 



1 

2 
3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



MS. HUNTER: Thank you. 

CHAIRMAN PERATA : Anyone else? Anyone here in 
opposition? 

Entertain the motion. 

SENATOR PADILLA: Move to confirm. 



Padilla 



CHAIRMAN PERATA: Motion to approve, Senator 

Call the role, please. 
MS. BROWN: Senator Cedillo. 
SENATOR CEDILLO: Aye. 
MS. BROWN: Cedillo Aye. 
Dutton . 

SENATOR DUTTON: Aye. 
MS. BROWN: Dutton Aye. 
Padilla . 

SENATOR PADILLA: Aye. 
MS. BROWN: Padilla aye. 
Battin. Perata . 
CHAIRMAN PERATA: Aye. 
MS. BROWN: Perata aye. 

CHAIRMAN PERATA: Four zero. Congratulations 
both of you. 

MR. WILLRICH: Thank you. 

MS. DOLL: Thank you very much, Senator Perata 

CHAIRMAN PERATA: You ought to stick around. 



37 



1 You'll be on the floor. I mean literally. 

2 (Laughter . ) 

3 MR. WILLRICH: Thank you very much, Senator. 

4 CHAIRMAN PERATA : Thank you. 

5 Doug McKeever for the Division of Juvenile 

6 Programs, Department of Corrections and Rehab. 

7 Welcome . 

8 MR. McKEEVER: Yes, sir. 

9 Good morning Mr. Chairman, Members. My name is 

10 Doug McKeever, and I'm before you this morning as the 

11 director of juvenile programs for DJJ, and I want to 

12 share with you some stories about DJJ and about myself. 

13 I'm an administrator. I have been for a very, 

14 very long time in state service, over 20 years that I've 

15 worked for this great state. What I am not is a 

16 political person, so this process is very difficult for 

17 me. It's new to me. If I appear a bit nervous about 

18 this, there's reasons for it. 

19 Rather than read from a scripted statement 

20 that's been prepared for me, I thought today I would 

21 spend a little bit of time talking to you about myself 

22 and DJJ, where I think we're headed, and basically talk 

23 from my heart . 

24 About a year ago, the secretary and the chief 

25 deputy secretary, Mr. Warner, asked if I would take on a 



38 



1 challenge for the Department. And at the time, I was 

2 the director of mental health for CDCR, enjoyed some 

3 success in that role, and was asked to take on a new 

4 challenge within D J J . 

5 I did so with open arms and embraced it, not 

6 recognizing the challenges that the actual department 

7 was facing within DJJ itself. That did not deter me, 

8 however, from my passion to see that the youth that we 

9 serve are provided with the care nhey deserve. 

10 Our population is small compared to the adult 

11 side. I had over 30,000 inmate patients in the mental 

12 health program alone on the adult side, whereas DJJ has 

13 less than 2,000 youth today. But those numbers do not 

14 in any way reference the lack of care that these youth 

15 deserve, because they deserve just as much attention as 

16 the adult side does. 

17 We have some very troubled youth within our 

18 system. They've committed some very bad crimes. 

19 They're here for a reason, but that in no way diminishes 

20 the fact that we have to provide them with the care they 

21 deserve while they're in our care with DJJ -- 

22 healthcare, education, and programs -- so when they get 

23 out of our system, they're successfully reengaged with 

24 their family and communities and, hopefully, do not come 

25 back to us . 



39 



1 In simple terms, I looked at this as a parental 

2 role. I have three boys at home. I would do anything 

3 for those kids, for their success in life, and I believe 

4 the same is true with the kids we have in our care at 

5 D JJ . We have to apply those same principles. 

6 Unfortunately, most in society don't see it 

7 that way. Many in society have turned their backs on 

8 these kids. DJJ has not. DJJ cares. I care. I want 

9 to share with you a few stories that I think exemplify 

10 that caring attitude of DJJ and its staff. 

11 Back in September, I attended a graduation at 

12 Preston, our facility in lone, in which over 70 of our 

13 youth participated in graduation ceremonies, either to 

14 get their GED or their diploma from high school. It was 

15 an absolutely moving event. 

16 At the end of the ceremony, in talking to the 

17 parents during the reception, I was amazed at the 

18 stories that they would tell about the fact that their 

19 child, their brother, their sister, their cousins, this 

20 was the first time in their family that they have seen 

21 somebody graduate from high school, and they did so 

22 within our system. And that's because DJJ cares. 

23 Several weeks ago we had unfortunate fires in 

24 California, devastating fires in California. We have 

25 two fire camps. We had a graduation ceremony at Pine 



40 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



Grove up in the foothills that was taking place, again, 


graduating kids that are in our care from high school. 


Some of those kids didn't get to participate in those 


graduation ceremonies because they were put on the fire 


lines. Those who did participate, an hour later they 


got on a bus and stood shoulder to shoulder with other 


individuals in this state fighting those fires. We 


provided them with the tools, the experience, and the 


knowledge to be able to do that, so that not only they 


could serve in that role with us now, but when they 


leave our system they can be productive members of 


society . 


We have a wonderful program down south at our 


southern facility. It's called Peace and Unity. It's a 


program by which youth make commitments that they will 


not engage in violence . And when they do so for a 


period of time, they're celebrated, and the community 


comes in and engages them, and there's a huge 


celebration that takes place at that facility that 


encourages those youth to continue to pursue that 


perspective where they want to change their lives. They 


do not want to be engaged in violence. 


I don't mean to point or paint a picture that 


appears to be extremely rosy. DJJ has a lot of work to 


do. We have a lot of improvements to continue to make. 



41 



1 As recently as the end of October, Judge Tigar 

2 issued an order, which if one were to read without 

3 understanding the good things that DJJ is currently 

4 doing, would think DJJ is falling, and that we're not 

5 able and capable of taking care of the kids in our care . 

6 Although legitimate issues were raised, 

7 personally, I was pleased that the judge decided not to 

8 appoint a receiver. That was something we had hoped he 

9 would not do, and he did not. He also gave us an 

10 opportunity to -- what I believe is an opportunity to 

11 reengage with the court, provide our commitments to the 

12 court on how we are going to satisfy the remedial plan 

13 items that we've identified five to six years ago when 

14 those plans were developed. Establishing our 

15 credibility is how I see that right now. It's our 

16 opportunity to do that. 

17 I was put in charge of preparing our responses 

18 to the court. Those responses indicate to the judge how 

19 we're going to move forward, the processes that we are 

20 going to take, how we're going to identify dates and 

21 make commitments to achieving those dates. And if we 

22 cannot meet those dates, be able to communicate not only 

23 with the judge, but with the PLO and other stakeholders, 

24 why, and what steps we're going to take to meet the 

25 issues that we've encountered that may preclude us from 



42 



1 achieving those dates . 

2 One of the things I wanted to highlight today 

3 is not a lot of data. I've got data that I can share 

4 with you. After this, I would be happy to leave it with 

5 you. But I want to put in perspective, I think, some 

6 things that DJJ has done recently that prove we care. 

7 I mentioned a little bit about education. 

8 Education is a glowing example within DJJ of how we're 

9 making improvements. Our last academic year, we had the 

10 most youth who went through and got and received a GED, 

11 who received a diploma, who received a vocational 

12 certificate, and those who enrolled in college courses. 

13 Violence in our facilities is way down. I 

14 wasn't around back in '05- '06, but from what I 

15 understand violence in our facilities was pretty doggone 

16 bad. 

17 Today when you walk in a facility, it's much, 

18 much better than it was. Is it where we want it to be? 

19 No. Do we need it to improve? Yes. But it's a lot 

20 better. 

21 We are taking efforts to work with experts to 

22 increase our ability to deal with our mentally ill, 

23 specifically in the area of suicide. We've worked with 

24 the experts, and they've approved policies for us now 

25 that we will be rolling out in the new year that will 



43 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



help our staff become better invo 


lved and eng 


aged 


in 


training on the signs and symptoms so that we 


can 


ensure 


we are providing the care that is 


needed to those 


who 


are mentally ill in our system. 








Healthcare in our system 


is improving. 


The 


experts gave us in our second round of audits 


a 




71 percent substantial compliance 


rating. We 


are 




constantly improving upon that. 


As recently 


as a 


month 


ago, the experts were at our Preston facility 


doing a 


medical audit, and we got word from them that 


our 




substantial compliance rating up 


there is now 


goi 


ng to 


be at 85 percent. We are making 


incremental 


step 


s 


forward in changing the system. 








We are rolling out a pro 


gram Service 


Day 


The 


program Service Day acknowledges 


that our kid 


s need a 


lot of care, that education is im 


portant, that programs 


are important, that healthcare is 


important . 


But 


what 


happened in the past was a competing force wh 


ere 


all of 


those disciplines wanted to pull 


kids out of 


school to 


go to programs or to healthcare. 


What we ' re 


now 


doing 


is developing schedules at each f 


acility that 


we ' 


re 


going to be rolling out in the new year that 


account for 


all of the needs these youth have 


to particip 


ate 


in, and 


those schedules will allow those 


youth to attend 


school 


and at the same time engage in th 


e programs that 


they 



44 



1 need. 

2 Lastly, our culture. Our culture is changing. 

3 We are providing our staff with a wealth of training 

4 which is allowing them to understand the reform efforts 

5 that we are undertaking right now. 

6 I'll point to you an example that I had after 

7 one of our staff attended a motivational interviewing 

8 course. And it was a cook in one of our facilities. 

9 And the cook went through the training and after the 

10 training talked to the instructor and suggested to the 

11 instructor that they now have a better understanding of 

12 their role in DJJ, that they're just not there to 

13 provide meals for the kids, that they're there to engage 

14 our youth, talk to our youth. They now know how to talk 

15 to the youth. And if those youth need care, they know 

16 now it's their responsibility to reach out to others 

17 within the Department to communicate that need so that 

18 youth's needs can be taken care of. 

19 CHAIRMAN PERATA : Thank you. 

20 Any questions? 

21 SENATOR DUTTON : Just a couple. 

22 SENATOR CEDILLO : I think you have a 

23 transmission problem. 

24 SENATOR DUTTON: Must be it doesn't want me to 

25 talk. 



45 



1 Using the term "juvenile," within the 

2 Department of Juvenile Justice is 12 to 24 age. And how 

3 many people in the system are over 18? Percentage- wise , 

4 or off the top of your head if you want. 

5 MR. McKEEVER: I think our average age in DJJ 

6 is roughly 19 . 

7 SENATOR DUTTON : So most of the people in the 

8 system -- how many of them are under -- 

9 To me, a true juvenile is somebody under 18, so 

10 how many kids do we have that are actually under 18? 

11 MR. McKEEVER: I don't have the exact count, 

12 Senator. I know that one of our facilities in the 

13 Stockton complex, which is O.H. Close, is designed 

14 specifically for those under the age of 18, so we have a 

15 little less than 200 youth at that facility. 

16 SENATOR DUTTON: Actually, what we need is -- 

17 So population under 16, you have roughly 193 offenders. 

18 Total population is 1987. I guess what I'm concerned 

19 about is: For the programs for those that are over 18, 

20 for example, technically, under California law, they're 

21 legal adults at that point. They can do a lot of 

22 different things. They can enter into binding 

23 contracts, they can -- they don't have the same 

24 protections and everything as children or young people 

25 who are under the age of 18 . 



46 



1 Once you go through your rehabilitation program 

2 and so forth, do you have -- and you teach them a skill, 

3 I'm assuming a marketable skill, do you also have some 

4 assistance to give them for actual placement in 

5 employment? Do you -- How far do you go to actually 

6 make sure they actually do get a job? 

7 MR. McKEEVER: Well, the Department is engaging 

8 in reentry efforts right now where we have individuals 

9 who are reentry coordinators in all of our facilities. 

10 And part of their role is to ensure that not only from a 

11 program perspective, but from a job perspective, that we 

12 try to, as much as we can, to get them reengaged back in 

13 their community once they're released from our care. 

14 SENATOR DUTTON : I understand that, but if we 

15 don't do something to give them an actual job, somebody 

16 who is willing to hire them, then the chances of them 

17 being successful on the outside is very slim, because 

18 they'll generally go back to what they did before. 

19 MR. McKEEVER: Senator, I think those are one 

20 of the areas that DJJ can be making some improvements 

21 upon and be much more proactive in engaging with the 

22 outside community to try and have placement 

23 opportunities for our kids. 

24 We do have agreements with trade unions on our 

25 vocational side that the instructors that we have 



47 



1 

2 

3 

4 

5 

6 

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15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



currently in things such 


as masonry and carpentry work 


have relationships with 


the trade unions on the outside 


of the Department . And 


when they can, they do place our 


kids when they know they 


1 re coming out . And I know some 


of our youth have been p 


laced in those opportunities 


when they present themse 


Ives . 


SENATOR DUTTON: 


Thank you . 


CHAIRMAN PERATA 


: I just have -- I'm perplexed 


at why the Department just had a director of education 


uncovered for four years 


since what you're suggesting is 


that's the focal point and purpose for what you're 


doing . 




MR. McKEEVER: 


Sir, it's well -documented that 


that position has been vacant for a very long time. 


CHAIRMAN PERATA 


: Probably why I found out 


about it . 




MR. McKEEVER: 


When I started back in January, 


it was my commitment to 


get that position filled, and I, 


with diligent efforts, vv 


ent through a recruitment effort 


to do so. 




Unfortunately, 


the applicant pool that we had 


was not such that we bel 


ieved they were going to be 


well-suited for that ver 


y, very important role. So as a 


result of that, I've, as 


recently as a month ago, 


appointed an individual 


as the acting superintendent of 



48 



1 education. 

2 I worked with our education experts before this 

3 decision was made to ensure that they were aware of who 

4 I was bringing in. They concurred with the individual. 

5 She's been now in that position for a month. While she 

6 is now running that department, I am reengaging in an 

7 effort to go back out and recruit nationally to fill 

8 that important role. 

9 CHAIRMAN PERATA : Maybe with the job market in 

10 the next year, you'll have more luck. 

11 MR. McKEEVER: I'm hoping so, sir. 

12 CHAIRMAN PERATA: We were just noticing that 

13 you've got a whole bunch of -- 20 percent of your wards 

14 are on psychotropic drugs . 

15 MR. McKEEVER: Yes, sir. 

16 CHAIRMAN PERATA: That says a lot. 

17 What troubles me is, and it's -- we talk about 

18 a lot of stuff, and I realize -- and I see that Matt is 

19 here -- you've got a really, really impossible situation 

20 in California Corrections, and it's probably made more 

21 complicated by our help. 

22 But you have -- You may have the only agency 

23 that I can think of as having direct involvement of all 

24 three branches of government. I don't know that that's 

25 a compliment, but that's a fact. 



49 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



A lot of the kids from YA or -- what we 


used to 


call it; it's given a different name now -- most 


of the 


people that are there probably come out of inner 


cities . 


I represent Oakland and Richmond. And it is 




extraordinarily important that you take the "We 


Care, " 


which sounds like, frankly, a marketing device, 


and try 


to move more forthrightly into the direction of 


getting 


kids some fundamental education, because we see 


when you 


come out of the adult prisons, the average reading age 


is pathetic. It's functionally illiterate. 




And having taught for a while myself, I 


know 


the lack of ability on the part of a young person to 


communicate orally, or particularly in writing, 


can be a 


very -- is a source of frustration and anger, an 


d they 


cover up, and they don't want to be discovered. 




So I think whatever can be done should 


be done 


in getting that position filled, and I compliment you 


on -- you know, violence is down and the culture 




changing . 




But maybe the best point you can look at is how 


your reentry programs are functioning, because we've 


done some things in Oakland, and it's pretty clear that 


there's no paucity of ideas. It's kind of hard 


to get 


everybody coordinated and doing the same thing. 


But 


it's really those kids who are coming out. 





50 



1 So if you've got these reentry coordinators -- 

2 I don't know how they function, and I don't want to tell 

3 you how to do your job. People have been a little 

4 critical of us lately about having to do our job, or 

5 don't, but what I would urge you to think about is at 

6 least if you have to start somewhere to get your arms 

7 around it, look at the reentry and how the educational 

8 programs that you have fit that, because these are the 

9 kids that come out and go back, and they go out, and 

10 then they come back as an adult, so they kept acquiring 

11 skills. And as dangerous as it is to have these people 

12 inside, it's a lot worse when they're outside. If they 

13 come back with the deck stacked against them, they're 

14 going to be wards of the state forever. 

15 I don't know how much -- If you've got 

16 20 percent of your population on psychotropic drugs, you 

17 know, in the old days it was Thorazine, good luck, God 

18 bless, but there are a lot of people around who are able 

19 to function with drug-induced behavior, legitimate, of 

20 course, or that the FDA says is okay. So I would just 

21 urge you to do whatever you can. 

22 Mr. Cate, this is probably more directed to 

23 you, but it is the desperate lack of practical 

24 educational skills and practical skills, you know, we 

25 have more and more kids now that -- I don't know. You 



51 



1 get a lot of stuff in our iPod, and you get a lot of 

2 stuff, I guess, in XBox with how to use a checkbook or 

3 open an account -- no banks right now, but all of those 

4 very simple things are things I encourage you to look 

5 at, because in my experience in talking to some of these 

6 kids, a lot of them are hiding out. A lot of them don't 

7 want to be there. They're not any help. So end of the 

8 sermon. 

9 Anybody here that would like to speak? It's 

10 funny. I thought you might have been here to speak. 

11 You're not going to read the whole binder. 

12 I'm sorry, Gil. Go ahead. 

13 SENATOR CEDILLO: This is something --a 

14 commendation that all of us have, the admiration that 

15 all of us have for you taking the job, given your 

16 background, experience, and expertise. We all recognize 

17 and I personally recognize how difficult your job is and 

18 appreciate you doing it. 

19 Having said that, I just want to do a couple 

20 things. I'm looking at the findings and facts and 

21 conclusions that the court came out with. I found them 

22 to be somewhat in stark contrast to your presentation, 

23 and I recognize, as the senator said, there are people 

24 who are not doing what we do, we don't quite understand 

25 it and at times can be hypercritical, so I'll let you 



52 



1 determine that. 

2 But can you reconcile your comments with the 

3 fact that the court has concluded that in this area, 

4 that we are abysmal and we remain abysmal, that's their 

5 word, and that they've put together a plan that we have 

6 yet to follow. So that's one. And if we're not 

7 following the plan, what are the challenges that affect 

8 us? 

9 The second is I am interested to hear a little 

10 more about your exit strategies, or the reentry 

11 strategies, and how you link them to other services in 

12 the agencies that the state provides so that we can 

13 ensure not only they not return, but we don't find these 

14 people moving into the streets, that there's some bridge 

15 so they don't move out of your facility into the streets 

16 of L.A. or Sacramento, you know, locations throughout 

17 the state where young people will go if they don't have 

18 the resources. 

19 I'm interested in what your thoughts are on 

20 what we could do to assist you in being more successful, 

21 and particularly I'm interested in, as we all are, the 

22 budget and the cost; to the extent it's appropriate for 

23 you to have 20 percent of your population dependent on 

24 drug therapy, and would they more appropriately be 

25 placed somewhere else. 



53 



1 Is that really your job, or should someone else 

2 be addressing their mental health needs? And is that 

3 the appropriate placement, or are we just, by structure 

4 and design, having more of an adverse effect on these 

5 young people as opposed to having them, perhaps, in the 

6 community but linked to treatment in the mental health 

7 community? 

8 MR. McKEEVER: Senator, I think you've raised 

9 three points, so let me try to touch on each of them 

10 individually, the first being not -- 

11 (Technical difficulties.) 

12 (Pause . ) 

13 MR. McKEEVER: You okay? All right. Is my 

14 time up? 

15 -- not following the plan as indicated by the 

16 court. And I think there are some very stark contrasts 

17 compared to what I have communicated today on some of 

18 the progress that I believe DJJ has made and those 

19 referenced in the court's order. 

20 I participated in the order to show cause 

21 hearing back in April and May in which DJJ testified in 

22 front of the judge to some of our successes, many of 

23 which are based upon data that is derived specifically 

24 from the court experts that he appointed. 

25 Why the judge chose not to include those 



54 



1 examples in his report, I'm uncertain of. I wish that 

2 he would have done so, because it would have been, I 

3 think, a more balanced view of the fact that: Are we 

4 great at what we are doing? No, we are not. Do we need 

5 to improve? Yes, we do. Are we making progress? Yes, 

6 we are . 

7 So from my perspective, I think the story is a 

8 bit more balanced than what one would read if they were 

9 only to look at that particular order. 

10 I am encouraged at the fact that in December we 

11 have a hearing scheduled with the judge at which time 

12 we'll be able to discuss with him, I think in more 

13 detail, our plans that we submitted last week on how we 

14 are going to reengage and be recommitted to this effort 

15 not only in meeting dates that they like to point to, 

16 but also what have we done within the system that has 

17 generated positive outcomes. And incrementally, over 

18 the last three years, we can demonstrate where we have 

19 made those progresses. 

20 As far as linking and reentry -- excuse me -- 

21 the Department is getting engaged in many, many efforts 

22 recognizing that reentry is a viable piece of the 

23 continuum of care for our youth. Having the reentry 

24 coordinators is certainly going to go a long way to 

25 assisting the youth getting back into their communities. 



55 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 





Family 


engagement 


is a big component of DJJ. 


We are embracing 


the family 


engagement processes. We're 


roll 


ing out efforts within 


all of our facilities to have 


f ami 


lies be more 


of a part 


of the youth's programing so 


they 


understand 


what it is 


they are receiving and why, 


and 


tfhat those services are 


that they're going to need 


once 


they leave 


us so we dc 


n't just drop them off at the 


door 


step and th 


ey don't know what to do with them. 




Are we 


there to a 


point where I can articulate 


clearly everythi 


ng that we ' 


re going to be doing? No. A 


lot 


of it is a work in prog 


ress, but it is an area that 


we h 


ave a high p 


riority on. 






Thirdly 


, relative 


to cost, we could probably 


spen 


d a great deal of time 


speaking about the cost of 


care 


within D JJ . 


I think i 


t's been well -documented by 


many 


, including 


the recent 


little Hoover Commission 


repo 


rt, that it' 


s very expensive to manage this system. 




There ' s 


a host of 


reasons for that . We have 


anti 


quated facil 


i t ies ; our 


population has gone down; our 


living unit sizes have to go down by court order. We've 


had 


to increase 


staff. Those staff, frankly, are the 


best 


paid staff 


in the nation, be they on either side of 


the 


equation, th 


e correctional side or the professional 


side 


, and all of 


those things contribute to a high cost 


rate 


for us . Yc 


u throw into that the fact that we have 



56 



1 a very high-risk and high-deemed population, and it 

2 makes our job very, very complicated. 

3 So whether or not we can effectively look at 

4 some of our youth and say they can be better served in 

5 the community, I would suggest that a further analysis 

6 would need to be done to determine that. Many of our 

7 youth might be better served in the community. The 

8 question would be: Does the community have the services 

9 available today to provide the care they need in an 

10 environment which is safe. 

11 Unfortunately, many of the kids that we have 

12 are in there for reasons that it's such that they 

13 require a higher degree of oversight. Whether the 

14 counties have the ability to provide that oversight I 

15 think is a debate that still needs to be had. 

16 I hope I have addressed all three of your 

17 questions . 

18 SENATOR CEDILLO : You have. I appreciate that. 

19 Let me ask you one last thing with respect to 

20 innovation. 

21 Have you guys looked at -- The charter schools 

22 seem to be having a lot of success with the more 

23 challenged. Have you guys looked at partnerships with 

24 those successful schools that have proven to be 

25 successful with the more challenged youth of our city? 



57 



1 MR. McKEEVER: I have not, and I appreciate 

2 that suggestion, and we'll look into that. 

3 I have worked with the county offices of 

4 education. I have established relationships with the 

5 deputy superintendent of education here in Sacramento, 

6 Mr. Marty Cavanaugh, but have not reached out beyond the 

7 local districts. So I think that's a wonderful idea 

8 that I will pursue. 

9 SENATOR CEDILLO : The last one is, again, just 

10 some of your comments on the building trades, the 

11 apprenticeship programs. 

12 We saw a short film recently on very successful 

13 efforts of training ex-gang bangers into very high- 

14 productive, high-paying, high-wage jobs. What are you 

15 experiences with that? 

16 MR. McKEEVER: I'm not familiar with the video 

17 that you're referencing, Senator. 

18 SENATOR CEDILLO: What experiences do you have 

19 with the trades in terms of integrating people who are 

20 exiting? 

21 MR. McKEEVER: Personally, my experience, I 

22 don't have any, sir. My reliance is on the schools and 

23 the sites and the professionals that provide those 

24 services at those sites. 

25 What I do bring to the table is the ability to 



58 



1 reach out and engage those local individuals and 

2 entities and let them become aware of the fact that we 

3 have folks who are skilled and trained and that could 

4 use jobs once they come out of our system. 

5 SENATOR CEDILLO : Okay. 

6 CHAIRMAN PERATA : (To the reporter) : Do you 

7 need a break? 

8 THE REPORTER: Yes. 

9 CHAIRMAN PERATA: We're going to take a 

10 few-minute break. She's new here. We'll take a 

11 ten-minute break, please. 

12 (Recess taken.) 

13 CHAIRMAN PERATA: We'll reconvene. 

14 MR. WARREN: My name is David Warren. I'm 

15 appearing on behalf of Taxpayers for Improving Public 

16 Safety. 

17 When I was asked to be here today, we faced the 

18 conundrum of either supporting or opposing based on the 

19 problem of whether or not this nominee was the 

20 unfortunate captain of the Lusitania that was 

21 desperately trying to fix the hole put in by a torpedo, 

22 and the captain of the Bismarck waiting to be torpedoed 

23 by the British because it was going around in circles. 

24 MR. McKEEVER: I don't know that I like either 

25 one of those . 



59 



1 MR. WARREN: Regretfully, I see too many 

2 graduates of DJJ as a chaplain in the state prisons. 

3 The recidivism rate for DJJ graduates seems to be 

4 extraordinary. I see too many mentally ill young people 

5 that come from DJJ after being paroled, and they are 

6 still walking around on psychotropic drugs in the yards. 

7 They have not progressed significantly. Their literacy 

8 is nonexistent, if at all, and they have no apparent 

9 skills other than barely able to take care of 

10 themselves . 

11 On behalf of Taxpayers for Improving Public 

12 Safety, we believe the debate should not be whether or 

13 not this nominee be confirmed, but whether or not there 

14 should be a DJJ. 

15 We hope at the next session we'll take a look 

16 at whether or not DJJ should be abandoned in its 

17 entirety and matters returned to the counties, or for 

18 smaller counties into centralized facilities shared by 

19 the counties to keep people close to their families for 

20 those that need it and to provide mental health care in 

21 common facilities for those that cannot receive it in 

22 the current DJJ environment . 

23 Clark Kelso's report and recommendations do not 

24 apply to DJJ, and they are in as desperate need as the 

25 state prison system. 



60 



1 For that, I thank you very much for your time. 

2 CHAIRMAN PERATA : Thank you. 

3 Anyone else? 

4 Well, I'm not going to be able to come back and 

5 watch over you. I have to entrust you to the rest of 

6 these guys. Good luck. 

7 MR. McKEEVER: Thank you, sir. 

8 CHAIRMAN PERATA: I won't even ask you to 

9 close . 

10 You already spoke. Did you have any questions? 

11 SENATOR DUTTON: No. I'm fine. 

12 CHAIRMAN PERATA: Motion to approve. 

13 Call the roll. 

14 MS. BROWN: Senator Cedillo. 

15 SENATOR CEDILLA: Aye. 

16 MS. BROWN: Cedillo aye. 

17 Dutton. 

18 SENATOR DUTTON: Aye. 

19 MS. BROWN: Dutton aye. 

20 Padilla. 

21 SENATOR PADILLA: Aye 

22 MS. BROWN: Padilla aye. 

23 Battin. 

24 Perata. 

25 CHAIRMAN PERATA: Aye. 



61 



1 

2 

3 

4 

5 

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7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



MS. BROWN: Perata aye. 

CHAIRMAN PERATA: Congratulations. 

MR. McKEEVER: Thank you very much. 

CHAIRMAN PERATA: Our last guest this morning 
is Terri Takai, the Chief Information Officer, State of 
California . 

Welcome . 

MS. TAKAI: Thank you. 

CHAIRMAN PERATA: Brought the boys with you. 
That ' s good. 

MS. TAKAI: Yes, I have the cheering group 
here , so .... 

CHAIRMAN PERATA: You guys behave. Think of 
this as a court of law. 

MS. TAKAI: Thank you, sir. 

First of all, I just want to thank you for 
having me this morning and tell you how much I 
appreciate being here. 

Let me just keep my opening remarks rather 
short and just talk about what my intention is and why 
I'm here. I think the question always comes, and that 
is, "What is the role of the Office of the State Chief 
Information Officer?" and what is it that is my 
intention in terms of the information technology program 
for California. 



62 



Put just simply, my objective is to really make 


California a leader in the use of information technology 


across the states and in government. I think we have a 


great start and a great opportunity to do that, but we 


have a considerable amount of work that we can do. 


What does that mean? What does being a leader 


mean? Being a leader means we deliver consistent and 


reliable and efficient and effective information 


technology, and that means several things: First of 


all, that we do that for our state agencies and 


departments so that we can ensure they're using the 


technology effectively. It means we're making the 


information accessible to systems and to our businesses 


in a way that's reliable, but also that's secure, and we 


do it in a way that is efficient so that we are ensuring 


that our technology investments are affordable, 


particularly within these difficult budget times. 


To do that, my role is to coordinate across 


over 130 CIOs that we have today in the state of 


California. Everywhere from our very large agencies, 


Health and Human Services, and areas like 


transportation, but also with many of the smaller CIOs 


that are responsible for many of our boards and 


commissions, to work closely with the Department of 


Technology Services and the Office of Information 



63 



1 Security and Privacy Protection to focus on very 

2 cost-effective technologies we can use statewide. 

3 And that is really also a major part of what 

4 I'm focused on, and that is making sure the technologies 

5 that we use and the way we address technology is 

6 statewide, that we're not looking only at individual 

7 projects and individual utilization of technology, but 

8 what we can do to share that technology both in terms of 

9 making information more accessible, but also in terms of 

10 being the most cost effective. 

11 So with that, what I would like to do, then, I 

12 think, is to take questions, please. 

13 CHAIRMAN PERATA : I see you're a graduate of 

14 University of Michigan. 

15 MS. TAKAI : Yes, I am. 

16 CHAIRMAN PERATA: They suck this year. 

17 MS. TAKAI: I know, I know. Let's not talk 

18 about the Ohio State game . 

19 CHAIRMAN PERATA: I wasn't speaking of anything 

20 specific . 

21 Let me ask you a couple of things . What ' s your 

22 assessment of the status of the technology that is 

23 available in California? How far behind are we? 

24 MS. TAKAI: Well, I think in terms of the 

25 actual technology that we're using, we actually are not 



64 



1 far behind. 

2 I am concerned about the budget situation 

3 coming up, because we do have some underlying technology 

4 that will have to be renewed. 

5 I think the challenge that we have is the way 

6 that we're actually utilizing and spending our 

7 technology dollars. We're doing a lot of different 

8 things, and we're doing a lot of the same things in 

9 different ways, and that causes us complexity, it 

10 increases our cost, and it doesn't allow us to actually 

11 get the maximum benefit. 

12 The other thing I think is that we're facing, 

13 over the next five years, a potential attrition. Over 

14 50 percent of our work force will be eligible to retire, 

15 and that is going to cause us a significant set of 

16 problems in terms of being able to keep our old 

17 technology running. 

18 We have many projects underway to renew that 

19 technology, but I think we're going to have to get the 

20 skill set in place and then continue with the projects 

21 that are currently on the books, and then be able to 

22 ensure that we can get those completed. 

23 The one area that I would say that we ' re 

24 struggling with, and this is true -- I'm not saying 

25 we're behind, Senator, because all the states are 



65 



1 struggling -- and that is to make sure that all of our 

2 technology is in very secure facilities. 

3 One of our challenges is that technology is 

4 pervasive, and most of our agencies and departments 

5 can't run without it, and yet we don't have it in 

6 facilities that can withstand some of the natural 

7 disasters, certainly, that we have to be careful of 

8 here . So 

9 that is one of the areas as well that I'm quite 

10 concerned about . 

11 CHAIRMAN PERATA: Our prison system, is that 

12 part of your jurisdiction? 

13 MS. TAKAI : Yes, sir. 

14 CHAIRMAN PERATA: We still don't have records 

15 that are electronic, do we? 

16 MS. TAKAI: No. There are several projects 

17 underway right now. I think the Department of 

18 Corrections has made really tremendous progress in -- 

19 CHAIRMAN PERATA: You don't have to do that. 

20 MS. TAKAI: Okay. That's still true. That is 

21 still true. They have been working on upgrading their 

22 technology, your prior question. They have done a lot 

23 with some projects, particularly, for instance, with 

24 parolees in many areas. They have two very large 

25 projects on the books right now. One to improve their 



66 



1 back end, just accounting and purchasing systems, which 

2 I think they're making major progress on, and then -- 

3 CHAIRMAN PERATA : That's why Gil went over to 

4 India, to check to see how that was going. 

5 MS. TAKAI : And then with the receiver, I think 

6 is the one you're most interested in, and that's the 

7 offender management system. And that is one, even 

8 though it is with a receiver, that we're working very 

9 closely with them on, because at some point that system 

10 will come back and be the responsibility of CDCR. 

11 CHAIRMAN PERATA: When you talked about 

12 security, you were talking about physical security. 

13 What's your relationship to privacy? 

14 MS. TAKAI: Well, my main focus is working with 

15 the Office of Information Security and Privacy 

16 Protection. Certainly, their role is to look at, on the 

17 privacy protection side, how to best inform the 

18 consumer, how to best inform businesses. 

19 My role is to make sure that we are 

20 implementing the policies of the Office of Information 

21 Security in the technology to make sure there's nothing 

22 in the technology that is going to risk the privacy of 

23 the information that we are responsible for as the 

24 state. 

25 CHAIRMAN PERATA: I'll come back to it. 



67 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 





Oh, I want to know if you ever met Joe Cimetti. 




MS. TAKAI : Yes, 


I have , and 


he ' s very 


interested in education data, and that's an area that 


we ' re going to be working 


very closel 


y with him on. 




CHAIRMAN PERATA: 


The little 


chips you put in 


your 


brain . 








MS. TAKAI: Yes, 


he is very 


concerned . 




CHAIRMAN PERATA : 


You know Joe . 




SENATOR CEDILLO: 


Or a cell 


phone , right . 




CHAIRMAN PERATA : 


Yeah. Go 


ahead, Gil . 




SENATOR CEDILLO: 


In May of 


2005, the Federal 


Real 


ID Act was signed into law, so I 


'm interested in 


your 


role in implementing 


the Real ID 


Act . 




MS. TAKAI: Well 


, my role is 


in several areas . 


One 


is that it's my responsibility to 


work very closely 


with 


the Department of Motor Vehicles 


to ensure that the 


tech 


nology projects that 


they have put in place in order 


to b 


e able to comply with 


Real ID are 


on schedule and on 


targ 


et, and that we're providing the 


adequate oversight. 




The second area 


that I ' m wor 


king with them very 


closely on is, there are 


two national 


associations that 


you 


are probably aware are very concerned about, as we 


brin 


g these data together 


, how are we 


going to look at 


them 


on a national scale 


to make sure 


we have privacy 


and 


protection as we're s 


haring this 


information . 



68 



1 I'm working with Director Valverdes with the 

2 Anvil organization, but the National Association of 

3 State CIOs also has a working group. What we're trying 

4 to do is to really determine, I think as you're well 

5 aware, Senator, the federal government basically left it 

6 up to the states to determine how to do that 

7 implementation, and that's a challenge because each of 

8 the 50 above have a different way of doing it. 

9 So what we're working on now is to see where 

10 the feds are going to go next and then to determine how 

11 we're going to coordinate to make sure that when we're 

12 sharing that data nationally, again, we're doing it in a 

13 way that doesn't jeopardize our own individual state's 

14 information. 

15 That is a concern, because we put a lot of 

16 time -- the Department of Motor Vehicles has put a lot 

17 of time in securing their information. They don't want 

18 to open it up to another state and have it be a security 

19 issue . 

20 So those are the areas that are my role in 

21 making sure the technology supports what the Department 

22 of Motor Vehicles is going to be doing as it relates to 

23 complying with Real ID. 

24 SENATOR CEDILLO: All right. Now, we have 

25 higher standards than most states, so talk to me about 



69 



1 the challenges of working with these other states that 

2 have lesser standards. Are you looking for a bottom 

3 line, an average, or ensuring that our high standards 

4 are at least respected by the other states? 

5 MS. TAKAI : It's really the latter. What we 

6 want to make sure is that our high standards are 

7 respected. 

8 The second thing is that just in technical 

9 terms, we want to make sure that that exchange of 

10 information is very secure. We want to make sure that 

11 in that exchange of information, there's no way for a 

12 state that's less secure than us to actually be able to 

13 get in and utilize the information in a way that's not 

14 secure. So there are ways where we can connect systems, 

15 even though they're not as secure, but we have to make 

16 sure that that connection is very secure. 

17 SENATOR CEDILLO : Okay. With respect to our 

18 side, at this point what's the -- We know that the DMV 

19 database, computer system, that's developed evolved over 

20 time. It's an organic system. Let me say that. 

21 In your opinion, what's the largest obstacles 

22 for us in terms of implementing the technological 

23 requirements to effect Real ID? 

24 MS. TAKAI: I think it's that it's just --in 

25 sort of very simple terms, there are a lot of technology 



70 



1 

2 
3 
4 

5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
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16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



proj ects 


at DMV that have to 


be successful, and the 


challenge 


is that for all of 


our agencies and 


departments, they haven't done this number of technology 


proj ects 


in a long time . 






So what we're doing 


is we're being very 


cautious 


on the project manag 


ement to make sure they 


have good 


skills to implement 


those projects. Also, 


that we ' re watching how large 


those projects get and 


that they 


■ re focused on the b 


usiness requirements of 


Real ID, 


because, again, one 


of the challenges is 


proj ects 


in California by their very nature are big, and 


they have 


to stay very focuse 


d on objectives, and they 


have to stay very focused on 


making sure we ' re making 


the most 


of the dollars that 


you have given us that you 


have allocated to those projects. 




SENATOR CEDILLO: Wi 


th respect to this question 


of information sharing, it sa 


.ys the states have to share 


information, but in your discussion, are we talking 


about us 


delivering or turnir 


Lg over or making available 


to other 


states the entirety 


of our database, or simply 


responding to inquiries that 


are specific to -- 




MS . TAKAI : The way 


the federal regulation is 


laid out 


today, it's for specific information. It does 


not mean 


that we have to open our databases for complete 


access by other states . And 


that ' s the area where we 



71 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



want to make sure that we ■ re complying with only that 


specific information and that we're not necessarily 


letting other states come into our database, but rather 


they request the data that they want, and then we 


transfer that. And it would be the same. It's 


reciprocal. When we want information, we would be 


expecting the same. 


The one big open question, Senator, that we 


still have not got a good perspective on from a federal 


perspective is whether the federal government is going 


to be looking at the creation of a national database 


where we would feed that information, or where the 


information would just be an exchange. 


And that's one of the areas where we want to 


continue to work with them, because there is always the 


concern whenever you create a federal database, what the 


controls would be, what the states would be able to say 


in terms of input, and how the states would be able to 


control the security. 


So those are the areas that are going to be 


evolving going forward, and I think we need to be a 


major part of that decision. 


SENATOR CEDILLO: We have a new President- 


Elect, and we have a new director of Homeland Security. 


Are there any thoughts on how these changes will affect 



72 



1 us moving forward, particularly given the fact that the 

2 new President-Elect was very affirmative about his 

3 support for issuing licenses to a motorist? He had 

4 voted for that as a state senator, and he was very 

5 affirmative, particularly during the debates. It wasn't 

6 much of an issue in the general campaign, but in the 

7 primary it was an issue for which he distinguished 

8 himself. What are your thoughts on that? 

9 MS. TAKAI : Well, from a technology perspective 

10 as it relates, certainly not just to Real ID, but many 

11 of the other areas, we're very much hoping that the 

12 President -Elect , first of all, really recognizes the 

13 importance of information technology in government. We 

14 haven't seen that, quite frankly, at a national level in 

15 a way that we would like to. 

16 SENATOR CEDILLO: It seems given the nature of 

17 his campaign, that he's fully appreciative of the value. 

18 MS. TAKAI: Exactly. Exactly. We hope also -- 

19 certainly, in terms of the President's office. 

20 On the Department of Homeland Security, what 

21 we're going to be pressing for, particularly through our 

22 national association, again, is not only a stronger 

23 recognition of all of the technology, but also a 

24 stronger recognition of the need to work more closely 

25 with the states. 



73 



1 There tends to be just general mandates coming 

2 down without much input back. There are many other 

3 areas. For instance, cyber security, one of the 

4 challenges DHS has had in the past is they've had 

5 multiple czars in their organization, and it's made it 

6 very hard for the states to actually be able to go in 

7 and influence the kinds of things that they're asking us 

8 to do. 

9 So those are the areas that we ' re providing 

10 input, certainly as best we can, into the transition 

11 teams and into our association and the things we're 

12 going to be focusing on. 

13 SENATOR CEDILLO : Anything prevents us from 

14 moving forward with -- we have to do conformity language 

15 or compliance language. Anything that holds us back 

16 from moving that forward? 

17 MS. TAKAI : Not to my knowledge. Again, I'm 

18 not intimately involved in all of the areas that DMV ' s 

19 working on from a policy perspective. But certainly in 

20 terms of the technology, my understanding in working 

21 with Director Valverdes is they're moving along towards 

22 material compliance, and we'll be able to meet the 

23 required data. 

24 SENATOR CEDILLO: I appreciate your 

25 participation in all these bodies. Are you a member of 



74 



1 the national CIOs? 

2 MS. TAKAI : Yes. In fact, I'm the past 

3 president. Two years ago, I was the president of that 

4 organization. 

5 SENATOR CEDILLO : When you were in Michigan? 

6 MS. TAKAI: Yes, when I was in Michigan. Yes. 

7 SENATOR CEDILLO: I think that's it. Thank 

8 you . 

9 MS. TAKAI: Thank you. 

10 CHAIRMAN PERATA : I want to congratulate you. 

11 You got out of Ford Motor Company just in time. 

12 Alex? 

13 SENATOR DUTTON : I just got a couple of 

14 questions . 

15 SENATOR PADILLA : Go ahead. 

16 SENATOR DUTTON: Regarding some of the process 

17 we're going through right now, the LEO report indicated 

18 that our IT projects usually end up costing about 

19 50 percent more than the original estimate. That would 

20 make me feel that we're not very good at estimating, or, 

21 you know, maybe it just was -- maybe cost more, period, 

22 and somebody didn't want to tell us. 

23 What are your thoughts on that? What is the 

24 reason that we seem to be having such a hard time on 

25 grasping the actual cost of doing our IT programs? 



75 



1 MS. TAKAI : I think there's a number of things. 

2 I do think one of them is -- to the point you're making, 

3 Senator, is the way our project approval works. We're 

4 actually trying to define what we expect a project to do 

5 way in advance of, actually, the point in time we start 

6 working on the project. 

7 So the estimating process for us is very, very 

8 difficult, and it's very difficult to know exactly where 

9 we're going, how that project is going to proceed. 

10 That's one of the reasons why we're looking to actually 

11 implement a more phased approach to some of our large 

12 projects, where you have defined deliverables, you can 

13 see those and then move on to future phases . So some of 

14 it is on estimating. 

15 The second thing, I think, is just a question 

16 of stronger project management. That is one area that 

17 we need to continue to grow. 

18 One of the issues with IT projects is that 

19 they're not actually purely about the technology. 

20 They're about what the agency or department wants the 

21 technology to do. And once that project gets started, 

22 we keep adding things that we'd like that technology 

23 project to do, and we have to be able to control that 

24 within the dollars and scope that we have. 

25 So I think it's a challenge in estimating, but 



76 



1 I think it's also a challenge in staying and being 

2 realistic about within the dollars that we have, you 

3 know, coming in the budget, what can we deliver, and 

4 then being able to provide that as a feedback mechanism 

5 to you so that you know how those dollars are being 

6 spent . 

7 SENATOR DUTTON : I hope you appreciate those of 

8 us who will be here after December 1st are going to be a 

9 little apprehensive, because we are trying to get a 

10 handle on things . And when you have a cost that exceeds 

11 over 50 percent over what was originally presented, that 

12 creates some really unique challenges. 

13 To that end, who should we hold responsible for 

14 those overruns? Should it be the departments 

15 themselves; should it be you? Whose responsibility is 

16 it? Who do we look to? It's not me. I'm 

17 obviously just -- You're reporting, and I'm buying off 

18 on what you're saying. So who do I hold accountable? 

19 MS. TAKAI : Well, I have responsibility for the 

20 oversight, certainly, of those projects that you 

21 approve. So it's my responsibility to make sure we are 

22 coming back and reporting to you on the status of those 

23 projects and that we're working on any remediation 

24 that's required. What I am responsible to do is to go 

25 back to that department or agency that ' s having 



77 



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difficulty with the project and work with them 


to get 


that project 


back on track. 






So, 


again, it's my responsibility, because I 


have the oversight, I approve those projects, < 


and it ' s 


my responsib 


ility to go back and 


work with the 




organization 


that ' s having the di 


f f iculty to b< 


a able to 


rectify that 


• 






SENATOR DUTTON: Final area has to do 


with 


Internet protocol version. We're 


using 4. Most people 


are . It has 


limited capability. 


Most governments, 


including th 


e federal government, 


have gone to 


6 . Are 


we going to 


be able to interface? 


Are we righ 


t now so 


far behind the curve that we all 


of a sudden h 


ave a 


system that ' 


s obsolete before we 


can get it up 


and 


running? 








MS . 


TAKAI : No, we aren' 


t . Actually, 


the 


federal government has directiona 


lly put in pi 


ace the 


requirement 


to move that way. But right now, 


we ' re 


using about 


70 percent, give or take, of the available 


IP-4 addresses that we have. And 


the approach 


that we 


use actually 


is to take those add 


resses and be 


able to 


expand them. 








So 


we believe, first of 


all, that the 


move to 


IP- 6 is goin 


g to take quite a bit 


longer than 


was 


necessarily 


originally projected, 


number one . 


Number 



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two , 


the 


equipment 


and th 


s manufacturers that we are 


using 


are planning 


for a 


gradual move so that there will 


be an 


ab 


ility to move from IP-4 to IP-6. And then 


thirdly , 


those same manufacturers are building 


interfaces, if you 


will , 


oetween those two technologies 


so we 


wi 


11 be able 


to mig 


rate gradually over time. We 


will 


not 


have a situation 


where we ■ re faced with needing 


dollars 


to be able 


to move from IP-4 compatible 


equip 


ment to IP-6 


:ompati 


ble equipment . 






SENATOR DUTTON: 


So during the next four years 


that 


I ' m 


here, I won't have to worry about you coming 


back 


in 


and saying 


, "Well 


, we have to upgrade to IP-6 


now, 


so 


I ' m going 


to need 


more money"? 






MS . TAKAI 


: No, 


sir . No , sir . 






SENATOR DUTTON: 


Thank you . 






CHAIRMAN 


PERATA: 


Alex? 






SENATOR PADILLA: 


Hello. 






MS . TAKAI 


: Good 


morning . 






SENATOR PADILLA: 


Just two areas of questions. 






One -- It 


' s been 


a while since I inquired, but 


the status of any 


sort of 


311 system, or using the 


Internet 


to allow 


for Cal 


ifornians, our constituents, to 


interface more eff 


icientl 


y with state government, do you 


know 


the 


status of 


any of 


those efforts? 






MS . TAKAI 


: No . 


I'm sorry, I don't. I'm not 



79 



1 aware of any specific 311 efforts, but that's certainly 

2 something we can look at and work with the agency and 

3 departments on and get back to you. 

4 SENATOR PADILLA : Coming from Michigan and in 

5 your industry, I know you're well aware of the efforts 

6 in other states, in other municipalities, especially in 

7 the era of ever- tightening budgets, using technology to 

8 deliver answers more effectively and efficiently in his 

9 call report. Second, and this is going to be very 

10 specific. I don't know if you've been briefed on the 

11 governor's executive order to, quote, unquote, "green 

12 state facilities." 

13 MS. TAKAI : Yes. 

14 SENATOR PADILLA: Are you familiar with that? 

15 MS. TAKAI: Yes. 

16 SENATOR PADILLA: To what extent do you 

17 incorporate technology not just on the energy efficiency 

18 or energy management side of state facilities, but here 

19 in this community and others? We've pushed for the 

20 broadening of those efforts not just on the energy 

21 efficiency side, but on the water efficiency, 

22 sustainable materials, all those elements of what we now 

23 consider sustainable building and design. 

24 MS . TAKAI : Those areas are areas that the 

25 Department of General Services -- we actually work with 



80 



1 them on. I'm not familiar with any of the specific 

2 initiatives that they're working on in terms of the 

3 technology. That is something that we can look at. 

4 One of the areas that we're very focused on 

5 from an energy efficiency standpoint actually are the 

6 various computer rooms and our usage of computers . 

7 Right now, the state has over 400,000 square feet of 

8 floor space where we're housing computers, and we're 

9 taking a look at that, because, first of all, that's a 

10 lot of floor space. It's a lot of energy utilization. 

11 And many private- sector as well as public- sector 

12 organizations are finding that one of their largest 

13 energy usages is actually in their data centers. 

14 And there are technologies today that the state 

15 can begin to use which will reduce the number of 

16 computers that we need and therefore reduce the amount 

17 of energy that we're going to be utilizing. And those 

18 are some of the things we ' re focused on in terms of 

19 bringing together how we use those computers statewide, 

20 doing it in a much more uniform, standard way so we can 

21 shrink the amount of power usage that we have . 

22 The other area is at the computer at your 

23 desktop. That's another area that we're focused on in 

24 terms of energy utilization. 

25 SENATOR PADILLA: I look forward to following 



81 



1 up with you on that, but I have to imagine for these 

2 broader- scale initiatives, there's an information system 

3 beneath it to help achieve the energy goal, the water 

4 goal, et cetera. 

5 MS. TAKAI : Right. 

6 SENATOR PADILLA : Thank you. 

7 CHAIRMAN PERATA : How do you compete in the 

8 future with the private sector for people who are 

9 competent, in other words, who's the best candidate? 

10 MS. TAKAI: It's tough. It's tough. I will 

11 say, back to one of your prior comments, I do have some 

12 hope, because right now -- Of course it's not good that 

13 the tech industry is struggling a bit, but it does give 

14 us some opportunity. They don't see it that way, but it 

15 does give us some. 

16 But in the future, it's going to be hard for 

17 us. It's going to be tough for us to compete not only 

18 for the specific technology skills, but I'm also 

19 concerned about the leadership skills . 

20 Technology folks today can't be just technology 

21 skilled. They have to be able to translate the 

22 technology into what it can do for the agencies and 

23 departments. The challenge we all have -- I mean, I'm 

24 an old techie, so I know that challenge well. 

25 CHAIRMAN PERATA: Me too. 



82 



1 MS. TAKAI : It's hard to say how the technology 

2 can actually make a difference in the business, and if 

3 you can't speak that language, the technology isn't 

4 effective . 

5 So I'm very much concerned not only on the 

6 technical level, but also on the leadership level and 

7 the project management level. The private sector is 

8 struggling with growing enough good project managers, 

9 and we're going to have to as well focus our attention 

10 on project managers in addition to just our technology 

11 skills. 

12 CHAIRMAN PERATA : Thank you. 

13 Anybody here in favor? 

14 MR. DAWSON: Good morning, Chairman Perata, 

15 Members. My name is David Dawson. I am with the State 

16 Controller's Office. I'm here representing the 

17 controller. 

18 I am the CIO, one of those 130 CIOs running 

19 around the state that Terri mentioned earlier. In 

20 addition, I am also the project director for the 

21 21st Century Project. 

22 We are here -- 

23 CHAIRMAN PERATA: Which one is that? 

24 MR. DAWSON: That's the replacement for the 

25 payroll and human resources system on a statewide basis. 



83 



1 It's the one enterprise- wide project going on on a 

2 statewide basis and probably the test bed for many 

3 future things to come, such as a fiscal project, which 

4 I'm sure you're all aware of. 

5 We have been working very closely with the 

6 CIO's office and have been very impressed with 

7 Ms. Takai's vision for technology on a statewide basis 

8 and her background and experience and suggestions and 

9 dealings with some of the issues that the 21st Century 

10 Project has faced. 

11 But also I'm looking at some of the things that 

12 she has brought forward on a statewide basis for the 

13 technology on a -- across the state. Some of those 

14 initiatives we think are very, very important in doing 

15 technology right across the state of California, both in 

16 terms of gaining the efficiency within the technology 

17 itself, the floor space issue, the energy issue she just 

18 mentioned is only the tip of the iceberg on that; but 

19 also in terms of getting the true benefit of some of 

20 these enterprise -wide things that the state has to 

21 embrace in order to manage the infrastructure of state 

22 government properly. 

23 So we are here very much to encourage 

24 Ms. Takai's confirmation and look forward to that 

25 continuing relationship. And I thank you for your time. 



84 



1 CHAIRMAN PERATA : Thank you. 

2 MR. GREGORICH: Good morning, Mr. Chairman and 

3 Members. Joe Gregorich with the American Electronic 

4 Association. I'm actually here this morning on behalf 

5 of both AEA and the Information Technology Association 

6 to offer our association's support of Ms. Takai . 

7 AEA and ITA together represent 3,000 high-tech 

8 member companies from all sectors of the high-tech 

9 industry. 

10 We have had the pleasure over the last year to 

11 work closely with Ms. Takai on several ventures and 

12 would like to offer our support. 

13 CHAIRMAN PERATA: Thank you. 

14 MR. MICHELI : Mr. Chair, Members, Chris Micheli 

15 on behalf of our clients, Citric Systems and Natoma 

16 Technologies. We've also had the privilege the past 

17 year of working with the CIO and, as you heard in 

18 response to several questions, including those by 

19 Senator Dutton, we're most impressed by her leadership 

20 in this arena and the management skills that she brings 

21 to the position and would also urge her confirmation. 

22 Thank you. 

23 CHAIRMAN PERATA: Anyone else? Anybody in 

24 opposition? Any further questions? 

25 We have a motion to approve. 



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Call the roll, please. 

MS. BROWN: Senator Cedillo. 

SENATOR CEDILLO: Aye. 

MS. BROWN: Cedillo aye. 

Dutton . 

SENATOR DUTTON: Aye. 

MS. BROWN: Dutton aye. 

Padilla. 

SENATOR PADILLA: Aye. 

MS. BROWN: Padilla aye. 

Battin . 

Perata . 

CHAIRMAN PERATA : Aye . 

MS. BROWN: Perata aye. 

CHAIRMAN PERATA: Close it. 

Congratulations . 

MS . TAKAI : Thank you . 

CHAIRMAN PERATA: We have one vote-only, and 



Alex -- 



SENATOR PADILLA: Before we take the vote-only 
item, I just want to make a statement for the record 
regarding Ms. Harris's appointment to the Teachers 
Retirement Board. 

In questions that I raised when she was before 
us a couple of months ago, I've had a chance to not only 



86 



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researc 


h but conduct follow-up meetings with her and 


other members of the board, so I just want to go on 


record 


saying I don't believe it is wise public policy 


for our 


Teachers Retirement Board to invest in a product 


that is 


one of the leading preventable causes of death 


in our 


state, in our country, and around the world. 




I agree with and support CalSTRS existing 


policy 


of not investing in tobacco companies, and I 


oppose 


any efforts to reverse this policy, and I'd 


oppose 


any efforts to invest our public funds in a 


product 


that involves a fiscal liability to our state. 




For those who would argue that the retirement 


system 


would have experienced greater earnings had they 


not divested from tobacco, I challenge them to show us 


indepen 


dent information leading to that conclusion. 




My understanding is the very information that 


CalSTRS 


has discussed as they revisit this policy on a 


regular 


basis is dependent or based on information 


provide 


d by the tobacco industry itself . 




Further, I doubt that the teachers across 


California would want their retirement funds invested in 


product 


s that harm the health of the very students 


they ' re 


working hard to teach. 




I will support the confirmation of Ms. Harris, 


but I vv 


'ant the appointee and rest of the board to know 



87 



1 we are watching and will continue to watch, and that the 

2 term "fiduciary responsibility" should not come at the 

3 expense of all other responsibilities we have to the 

4 public. Thank you. 

5 CHAIRMAN PERATA : Thank you . 

6 SENATOR CEDILLO : I appreciate those comments 

7 and attach myself to the cough and to the comments of my 

8 colleague . 

9 I think a substantive appreciation of fiscal 

10 and fiduciary duty mandate and require us to think about 

11 not only short-term profits, but long-term gain and its 

12 impact on our community. 

13 So you can't say you're acting as a fiduciary 

14 without realizing the substantive meaning of that trust. 

15 So as I stated, I echo the concerns and share the 

16 comments of my colleague . 

17 CHAIRMAN PERATA: Do we have a motion? 

18 Please call the roll. 

19 MS. BROWN: Senator Cedillo? 

20 SENATOR CEDILLO: Aye. 

21 MS. BROWN: Cedillo aye. 

22 Dutton. 

23 SENATOR DUTTON: Aye 

24 MS. BROWN: Dutton aye. 

25 Padilla. 



88 



SENATOR PADILLA: Aye. 
MS. BROWN: Padilla aye. 
Battin . 
Perata . 

CHAIRMAN PERATA: Aye. 
MS. BROWN: Perata aye. 
CHAIRMAN PERATA: Four- zero 
recommended . 



Confirmation is 



We're now going into executive session. 

(Thereupon, the Senate Rules Committee hearing 
adjourned at 11:24 a.m.) 



0O0- 



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- -oOo- - 

I, INA.C. LeBLANC, a Certified Shorthand 
Reporter of the State of California, do hereby certify 
that I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee 
hearing was reported verbatim in shorthand by me, 
INA C. LeBLANC, a Certified Shorthand Reporter of the 
State of California, and thereafter transcribed into 
typewriting . 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in 
any way interested in the outcome of said hearing. 

IN WITNESS WHEREOF, I have hereunto set my hand 
this *lw{ day of J)e? f g.VH. k-fc. ~~> ._' 2 008. 



INA C. LeBLANC 



Certified Shorthand Reporter 
CSR No. 6713 



-oOo- 



90 



APPENDIX 



91 



July 18,2008 

Ms. Nettie Sabelhaus 

Senate Rules Committee Appointments Director 

State Capitol, Room 420 

Sacramento, CA 95814-4900 

RE: Responses to Questions Posed by the Senate Rules Committee 

Dear Ms. Sabelhaus, 

I appreciate this opportunity to respond to questions posed in President Perata's July 1, 
2008 letter. 

Role of CAISO and Its Governing Board 

Question I: What do you believe to be the core mission of the CAISO? What role 
should CAISO have in overseeing and facilitating changes to the electricity market, 
and what happens when there is a conflict with the goal of ensuring grid reliability? 

The core mission of the CAISO was laid out by the Legislature with the restructuring of 
California's wholesale electricity industry ten years ago: 

• to provide open and nondiscriminatory access to the electric transmission grid and 

• to manage the grid and market operations fairly, reliably and cost-efficiently 
within an overall objective to ensure public health and safety. 

• 
Much has happened in the last decade and the role of the CAISO has necessarily evolved 
to support the expanded operation of electricity markets and to promote infrastructure 
development and environmental stewardship to meet state policy objectives, especially 
the addition of significant amounts of renewable energy. It is appropriate and necessary 
for the CAISO to work collaboratively with other state agencies and the Legislature to 
support the changing market in the context of state policy objectives and to help identify 
potential problems and solutions. 

If there is a conflict between grid reliability and market development, reliability must 
remain the number one priority. 

Question 2: CAISO has been criticized for allowing staff to make major policy 
decisions without input from the board. The most well-known example took place in 
late 2000 when CAISO staff took action to suspend price caps on electricity during the 
energy crisis without board approval. How would you describe the role of the 
governing board and the role of staff in regard to setting CAISO policy? 

The board is responsible for governing the CAISO; day-to-day operations are the 
responsibility of management. The importance of open communication and clear 
delineation of responsibilities between the board and management cannot be over- 

Scoate Roles Committee 



IJUL 2 i 21 
Appointments 



emphasized. Specifically, the board selects and evaluates the President and CEO and 
appoints other Officers on recommendation of the President and CEO. With regard to 
CAISO policy, the board sets organizational priorities within the bounds of all applicable 
laws and policies. The board also actively monitors corporate performance, approves all 
material transactions, assesses risk and oversees internal controls, and monitors 
compliance with policies and procedures, all under a charge to operate with the highest 
ethical standards. 

CAISO management recommends to the board policies and other actions to support the 
strategic goals that have been jointly established and approved by the board. My 
experience to date suggests that staff and board roles are functioning appropriately, and 
no tariff changes have been filed without board approval. 

Market Redesign and Technology Update 

Question 3: What impacts do you believe MRTU will have on energy costs to 
consumers? 

MRTU is designed to increase system efficiency and exert downward pressure on cost 
over time. Even with MRTU improvements to operation of the CAISO system, the 
foundation of the California electricity market remains predominantly based on long-term 
contracts to provide overall "resource adequacy" to consumers and reduce market risk. 

MRTU will provide CAISO system operators with the pricing information and 
technological tools to plan for the most efficient and lowest cost use of the grid on a day- 
ahead basis. Better scheduling of transmission facilities should reduce bottlenecks on the 
grid and lower congestion costs. The "least cost" dispatching of generation and demand 
response over the entire CAISO control area should both stabilize overall system costs 
and provide incentives for new infrastructure where needed. 



Question 4: What will be the CAISO 's role in monitoring and overseeing MR TV and 
its impacts? How will the board stay informed? 

The CAISO has the responsibility for the monitoring and oversight of MRTU. 
Immediate indicators will be available through reports of daily operations and billing 
functions. Feedback will also be collected from all stakeholders, state agencies such as 
the CPUC and CEC, and FERC. Within the ISO, front line staff in operations, market 
design and stakeholder relations will be directly involved in implementation and will 
provide ongoing reports. The CAISO has designed a multi-disciplinary response team to 
diagnose and resolve potential issues, and has in place a series of real-time metrics to 
measure the performance of MRTU and anticipate market issues. The board will be kept 
informed on a timely basis. 

In addition, the Department of Market Monitoring reports to the board directly and will 
play a lead role in assessing MRTU implementation and communicating results. The 



2 93 



independent advisory group called the Market Surveillance Committee will also review 
market impacts and report them to the board directly. The combination of internal and 
external reviews of MRTU performance should provide beneficial diverse perspectives 
and should strengthen the board's critical review capabilities. 

Question 5: What criteria will you use to determine whether CAISO should vote to 
certify the readiness of MRTU? 

Given the massive amount of time and effort that has been invested in MRTU 
development, the CAISO has put in place an extensive project management plan and 
certification process to assess readiness for the ultimate launch of MRTU. A 
comprehensive list of readiness criteria, developed in conjunction with stakeholders, is 
being tracked and must be completed prior to program launch. 

For more than a year, stakeholders have been actively engaged in hands-on system testing 
and at every meeting the board receives multiple updates from staff, consultants and 
stakeholders about detailed issues related to MRTU readiness. The board will review 
readiness status in detail again in mid-August and regularly as we approach the proposed 
"go live" date. 

Key questions the board is focusing on include: 

• how the software is operating, 

• whether CAISO staff is adequately trained and confident operating the system, 

• whether market participants are adequately trained and confident operating the 
system, and 

• whether the appropriate formal processes and tariffs are in place to operate 
MRTU. 

The board has ultimate responsibility for determining whether MRTU is certified as 
ready, and has, on numerous occasions thus far, expressed its commitment to ensuring the 
launch of a quality program and systems over speed or forced deadline. 

2008 to 2012 Strategic Plan 

Question 6: How will the board monitor the [Strategic] Plan 's effectiveness? 

The 2008-2012 CAISO strategic plan builds upon organizational deliberations that 
involved staff at all levels of the organization and sought input from market participants, 
policy makers and other stakeholders beginning in 2006. This year's plan is the 
culmination of a three stage process that first assessed the capabilities of the organization, 
then focused on strengthening operational excellence, and now is focused on moving the 
CAISO to a higher level of organizational effectiveness. 

The plan includes an extensive and detailed "'to do list" of initiatives that are tied to three 
key objectives and which enable the board to track progress throughout the year. These 
initiatives form the basis of the board's ongoing and final annual review of the CAISO's 



3 94 



overall performance and that of the management team. Examples of key components of 
that assessment include customer service metrics, MRTU performance, success of 
renewable resource and demand response integration, collaboration with state and federal 
agencies, and success of human resource initiatives. 

Question 7: Please briefly describe some efforts CAISO will undertake to build 
alliances with state and federal policy makers to help "green the grid," which is one of 
the plan 's objectives. 

The alliances and ongoing relationships with the CA Public Utilities Commission, CA 
Energy Commission, CalEPA and FERC are reasonably well established and there is 
high-level alignment with state environmental goals. However, measurable results and 
progress require effective coordination, constant communication, dedicated resources and 
support throughout the organization, beginning at the top. The CAISO board is 
committed to these principles and has approved the dedication of a significant portion of 
CAISO staff and financial resources to stakeholder and intergovernmental collaborative 
activities. A variety of entities increasingly call upon the CAISO's technical expertise in 
considering the implications of state and federal policies on the electric system and 
markets. Some key topics being addressed in collaborative activities include: 

• The Renewable Energy Transmission Initiative (RETI) 

• Once-through cooling policy development 

• Greenhouse gas regulation 

• Demand response 

• Resource loading order 

• Improvement to the overall siting process for electric facilities 

• Implementation of rebuttable presumption to align the ISO transmission planning 
process with the CPUC decision making on economic need of transmission 
facilities 

• Flex Your Power NOW! statewide conservation awareness campaign 

Question 8: Please give an example of the role a new demand response program might 
have in the electricity market. 

The clearest example for demand response programs is to expand their level of 
contribution to the market, i.e., scale up to larger megawatt capacity, and raise their 
operation to a higher level so they may contribute just like other sources of supply. Their 
role should be such that they can participate on a daily basis and be integrated into 
economic system dispatch, rather than be used solely during peak periods and system 
emergencies. 

Question 9: What is CAISO's schedule for integrating demand response products into 
wholesale power markets? 

A significant statewide contribution from demand response may be several years in the 
making, but it is technically feasible and urgently needed. There already is some 



4 95 



integration of demand response through interruplible and time of use rate triggers during 
system peaks and voluntary load reductions in response to Flex Alerts or other 
emergency appeals. However, as stated above, the ultimate role for demand response 
needs to be materially larger in both real and relative terms than any previous 
contribution, and it needs to be fully integrated with other supply options. The CAISO 
expects to increase the functionality of demand response in wholesale energy markets 
within twelve months of MRTU implementation. 

Demand response programs will require customer education and awareness of supporting 
technologies and any future legislative changes to the retail market structure. Ultimately, 
customers will require confidence that the policies and process requirements underlying 
future programs will have consistent procedures, transparent pricing, and longevity 
sufficient to support customer interest and investment. 

Demand response can help support both intermittent renewable resource generation and 
more traditional system operating needs as part of a dispatchable resource portfolio. The 
CAISO's current strategic plan has three initiatives relating to demand response: 

• to incorporate demand response in the transmission planning process, 

• to increase demand participation in the markets by showcasing technologies and 
solutions within the ISO's demand response lab, 

• and to develop demand response mechanisms to ensure efficient interface 
between wholesale markets and environmental policy. 

The CAISO is committed to making real progress in these areas over the 2008-2012 
planning horizon, and the board will evaluate its performance accordingly. 

Integration of Renewable Resources 

Question 10: What specific steps is CAISO taking to integrate renewable resources 
into the electric grid? 

The State's current renewable goals and objectives are clear and the CAISO and its 
strategic plan comport with the goals and objectives. The CAISO is committed to 
ensuring that its actions both further the states' renewable energy and climate change 
objectives, and help facilitate their implementation without delay. In 2007 the CAISO 
issued an important study called "Integration of Renewable Resources" which examined 
the increasing level of intermittent renewable resources and recommended several 
measures including installing additional capacity, deploying new market mechanisms for 
load following support, and improved forecasting capabilities. The CAISO is making 
progress in getting specific tools in place; two recent CAISO actions are particularly 
noteworthy: 

• The CAISO is making it easier for renewable generators to connect to the grid: 
Most recently, at its July meeting, the Board approved changes to the "Large 
Generator Interconnection Procedures," also referred to as the generator "queue". 
This process change involved extensive engagement with stakeholders, state 



96 



agencies, and FERC. It is aimed at alleviating the lengthy backlog of 
interconnection requests and supporting the timely interconnection of new 
renewable generating capacity. 

• The CAISO is helping to identify critical renewable energy zones and facilitate 
transmission needed to support them: The CAISO has been actively involved in 
the State's Renewable Energy Transmission Initiative (RETI), a collaborative 
effort to develop and build consensus support for transmission infrastructure 
needed to meet the state's Renewable Portfolio Standard and greenhouse gas 
mandates. This work is identifying "Competitive Renewable Energy Zones" and 
preparing detailed transmission plans of service to these typically remote areas 
with the ultimate goal of achieving both 20% and 33% RPS goals. 

The CAISO has also adopted policies to make it easier for wind generators to participate 
in the market (through the "Participating Intermittent Resources Program") and to reduce 
financing uncertainty for transmission facilities needed to access renewable resources 
("Location Constrained Resource Interconnection"). 

While the work to support RPS and GHG objectives will be an ongoing part of CAISO 
activities into the indefinite future, several of the necessary building blocks to achieve the 
State's goals are formed and under development and should contribute measurable 
improvements in the coming months. 

Question 11: The report did not consider the costs of integrating renewable resources 
into the electric grid. Will CAISO estimate these costs? If so, when? 

As part of the Renewable Energy Transmission Initiative (RETI) with other state 
agencies, the CAISO recently provided an estimate of costs associated with 
approximately six major transmission lines that may be needed to support 33% renewable 
resource development. Additional work is underway through RETI and renewable 
integration cost estimates ultimately will be developed by the state agencies for the 
options identified in that collaborative effort. The CAISO board is dedicated to 
implementing policies with the lowest possible cost and making costs transparent. 

Transmission Planning 

Question 12: How does this action - which could be viewed as making CAISO a "grid 
builder" - reconcile with ISO's current practices as "grid manager"? 

The board action in December 2007 does not change the CAISO's fundamental role as 
grid manager. The CAISO is the grid planner and guardian of system reliability, not the 
builder of transmission infrastructure. The December 2007 proposed tariff amendment 
was a response to a specific nationwide FERC directive (in Order No. 890). In light of 
FERC's interest in guarding against undue discrimination and a preference for 
transmission service, all ISO's were ordered to amend their existing tariffs to comply 
with nine planning principles specified in the order. The CAISO engaged in a full 



6 9 7 



stakeholder process to revisit clarify and ensure the consistency of its existing planning 
process with all principles. The resulting compliance filing to FERC did not significantly 
shift or add to existing CAISO policy or authority. 

Question 13: How is this action consistent with federal and state directives on 
transmission planning? 

It is consistent with both federal and state directives. FERC already has accepted the 
CAlSO's revised transmission planning process as consistent with its order as of June 19, 
2008. While FERC sought further clarification of a few issues, none of the areas 
challenged the CAISO's role in transmission planning or its ability to identify needed 
transmission projects. 

At the state level, siting and project approval continue to reside with the CA Public 
Utilities Commission or local regulatory authorities and the CAISO approves the 
recovery of transmission cost in wholesale transmission rates. At the same time, state 
directives on transmission planning recognize the central role of the CAISO. Public 
Utility Code 345 states that "the independent system operator shall ensure efficient use 
and reliable operation of the transmission grid consistent with achievement of planning 
operating reserve criteria no less stringent than those established by the Western Systems 
Coordinating Council and the North American Electric Reliability Council." It would not 
be possible for the CAISO to ensure compliance with planning criteria, long term 
reliability if it did not have a meaningful role in identifying the facilities that must be 
built to meet the established standards. 

Question 14: How will this action prevent undue discrimination and preference in 
transmission service? 

As noted above, the purpose of the FERC Order was to promote non-discriminatory 
transmission service by ensuring that all transmission planning processes comply with the 
following nine planning principles: 1. Coordination, 2. Openness, 3. Transparency, 4. 
Information Exchange, 5. Comparability, 6. Dispute Resolution, 7. Regional 
Participation, 8. Economic Planning Studies, 9. Cost Allocation. 

By finding CAISO's transmission planning process consistent with its planning 
principles, the FERC concluded that CAISO's planning activities would act to prevent 
discrimination and preference. 



Sincerely, 



Laura R. Doll 



98 



Date: July 19, 2008 

To: Senate Rules Committee, California Legislature 

From: Mason Willrich, CAISO Governing Board Member and Chair 

Subject: Answers to questions asked in July 1 , 2008 letter from Senator Don Perata 



1 . What do you believe to be the core mission of CAISO? 

CAISO's mission is to: operate the electric transmission grid under its authority reliably and 
efficiently; provide fair and open transmission access for all market participants; facilitate 
effective and efficient wholesale electric markets; and promote necessary electric infrastructure 
development. 

What role should CAISO have in overseeing and facilitating changes to the electricity market? 

The CAISO's electricity markets are limited to the wholesale level. Wholesale power markets 
are regulated by the Federal Energy Regulatory Commission (FERC). The major features of 
CAISO's markets are embodied in tariffs which must be approved by FERC. The CAISO 
manages a complex process of continuous improvement in the operation of its wholesale 
markets. That improvement process engages numerous market participants with diverse 
functions and interests, state regulatory agencies such as the California Public Utilities 
Commission (CPUC) and California Energy Commission (CEC), as well as FERC. 

What happens when there is a conflict with the goal of ensuring grid reliability? 

As CAISO manages proactively the process of improving the effectiveness of its wholesale 
power markets, the likelihood of conflicts arising between markets and reliability are diminished. 
Indeed, market improvements are diminishing congestion on the transmission grid, leading to 
increased service reliability as well as reduced costs for market participants. Nevertheless, if 
and when the reliability of power flows on the transmission grid is threatened, whether by an 
unforeseen major event or a temporary malfunction in CAISO's markets, maintenance of 
reliability will take precedence over potentially conflicting objectives, as required by federal law 
administered by the North American Electric Reliability Corporation. 

2. How would you describe the role of the governing board and the role of staff in regard to setting 
CAISO policy? 

The board is ultimately responsible for the affairs of the corporation. The board approves major 

corporate policies, multi-year strategic plans, annual budgets, major capital expenditures, major 

corporate financings including bond issues, employee benefit plans and policies, employment 

and termination of the CEO and officers of the corporation, as well as tariff filings with FERC. 

Management is responsible for day-to-day operations of the company, including operating the 

electric transmission grid 24/7, operating wholesale power markets, management of stakeholder 

processes, and interactions with governmental bodies such as the CPUC, CEC, other state 

agencies, the California Legislature, FERC and other federal agencies. Since I joined the 

CAISO board in 2005, I do not believe CAISO staff has made major policy decisions without prior 

board review and approval. MA 

Senate Rules Committee 

UUL 2 3 2008 " , 

ATwointments 



3. What impacts do you believe will MRTU have on energy costs to consumers? 

Market Redesign and Technology Upgrade (MRTU) will increase the efficiency and effectiveness 
of CAISO's wholesale power markets. MRTU is based on a full network model enabling 
production of location specific marginal prices used in an integrated day-ahead market, and the 
real-time market. The result will be increased price transparency in CAISO's power markets and 
much more effective market monitoring to protect against market manipulation. Electricity costs 
to retail consumers are likely to increase in the future. However, the improvements of CAISO's 
markets resulting from MRTU will benefit consumers in an era of rising prices. 

4. What will be CAISO's role in monitoring and overseeing MRTU and its impacts? 

CAISO has a separate Market Monitoring Department, staffed by highly competent 
professionals, which reports directly to the CEO and the board and is responsible for monitoring 
the performance of all aspects of CAISO's markets in detail. In addition, CAISO has an 
independent Market Advisory Committee composed of distinguished academic economists who 
have expertise in the functioning of electricity markets. The Committee offers advice and 
opinions in numerous CAISO managed stakeholder processes and, when invited, in regulatory 
proceedings. It also advises the board directly. During its development and after it "goes live," 
MRTU has been and will continue to be a major responsibility of CAISO management, on a daily 
basis. 

How will the board stay informed? 

MRTU has been and will continue to be a major oversight responsibility of the board. The board 
has received, and will continue to receive after "go live," at its regular meetings detailed status 
reports by the MRTU Program Manager and other staff members on specific aspects of 
development and problems encountered, as well as assessments of overall progress of the 
project. In addition, management advises and consults with the board whenever an issue arises 
that is appropriate for special board consideration or approval. 

5. What criteria will you use to determine whether CAISO should vote to certify the readiness of 
MRTU? 

CAISO has established specific criteria which must be met as a basis for management to 
recommend and the board to decide whether to certify to FERC the operational readiness of 
MRTU 60 days in advance of the projected "go live" date. These criteria apply to internal CAISO 
readiness and to market participant readiness. They specify rigorous market simulation testing 
under a wide variety of scenarios by CAISO operating staff and market participants, and the 
quality of solution for day-ahead and hour-ahead markets. The functioning of MRTU processes 
is also being audited by Scientific Applications International Corporation (SAIC) and Law and 
Economics Consulting Group (LECG). In deciding how I vote on a decision to certify to FERC 
the readiness of MRTU, I will use inputs of market participants into CAISO's MRTU stakeholder 
process, reports of outside auditors, opinions of CAISO's Market Monitoring Department and 
Market Surveillance Committee, recommendations of CAISO's management, and my own 
judgment of the risks, costs and benefits based upon my involvement in MRTU project 
development since I joined the CAISO board in 2005. 

6. How will the board monitor the [CAISO 2008-1 2 strategic] plan's effectiveness? 

The board participated actively in the process which led to the formulation and recommendation 

by management to the board for approval of CAISO's 2008-2012 strategic plan. The plan 

establishes strategic objectives and sub-objectives, and specific corporative initiatives to achieve 

excellence in grid and market operations, transparent market operations that drive effective use 

100 

2 



and development of grid resources, and organizational effectiveness by giving focused attention 
to customers' priorities. Criteria are established within the plan for measuring corporate 
performance towards achieving objectives. Management reports to the board quarterly, or as 
needed, on CAISO's progress in achieving the plan's objectives. 

7. Briefly describe some efforts CAISO will undertake to build alliances with state and federal policy 
makers to help "green the grid," which is one of the plan's objectives. 

The California renewable energy portfolio standard (RPS) requires every retail seller of electricity 
within CAISO's balancing authority to serve 20% of load from renewable energy resources by 
the end of 2010. The state government is currently considering whether to adopt an RPS which 
requires all load serving entities within California to serve 33% of load from renewable energy 
resources by 2020. CAISO is taking a proactive approach to enable achievement of the 20% 
goal as soon as possible, and achievement of the 33% goal by 2020. CAISO provided one study 
in 2007 that indicates how the 20% goal may be achieved, and another preliminary and 
conceptual study of how the 33% goal may be achieved. CAISO has obtained from FERC 
approvals of a proposal to accelerate the process for interconnecting generation projects to the 
transmission system, and of an innovative financing mechanism to integrate into the grid 
transmission projects from remote locations which are rich in renewable resources. This FERC 
decision provides a precedent for financing such transmission development elsewhere in the 
United States. CAISO is working closely, through the California Renewable Energy 
Transmission Initiative (RETI) with the CPUC, CEC and a broad range of stakeholders in 
California to develop a consensus plan to build transmission infrastructure needed to meet 
California's RPS and greenhouse gas (GHG) mandates. Nevertheless, the Sunrise Project, 
which is necessary for the state to achieve its 20% RPS, and which CAISO approved almost 2 
years ago, still languishes in contentious CPUC proceedings. The CPUC is expected to make a 
decision on the Sunrise Project in December, 2008. 

8. Please give an example of the role a new demand response program might have in the 
electricity market. 

CAISO has launched a demand response (DR) lab to demonstrate the role that DR might have 
in the electricity market. More importantly, CAISO is working with regulators, utilities and other 
stakeholders to resolve how DR can contribute to market efficiency and enhance reliability under 
MRTU, and, thereafter, to achieve the full value of DR in California's electricity markets. 
Currently, DR is an important option to meet demand peaks or supply emergencies. CAISO is 
evaluating technologies and operating procedures that, if implemented, will enable DR to 
become an electric supply resource 24/7. 

9. What is CAISO's schedule for integrating demand response products into wholesale power 
markets? 

Currently, DR can participate in CAISO's wholesale markets to a degree, and CAISO is 
developing mechanism to achieve greater functionality within one year of the date that MRTU 
"goes live." However, for the full potential of DR to be realized retail electric policies and pricing 
need to be fully aligned, and responsibilities for DR procurement need to be clarified. 

10. What specific steps is CAISO taking to integrate renewable resources into the electric grid 7 

See answer to question 7 above. In addition, since 2002 CAISO has conducted a participating 
intermittent resource program (PIRP) which mitigates the financial consequences for renewable 
energy suppliers of the variable nature of some renewable resources such as wind. At the 
CAISO board meeting on July 9, the board approved a CAISO tariff filing with FERC proposing a 

101 



major reform of FERC's mandated large generator interconnection process to enable a new 
process to deal with the existing backlog of transmission projects in CAISO's request queue and 
to enable fair, efficient, and timely treatment of requests, including numerous requests for 
interconnection of renewable energy projects. In addition, a CAISO task force is evaluating the 
use of energy storage technologies to provide a variety of essential services to electric wholesale 
markets which will support and complement the integration of intermittent renewable energy 
sources. 

1 1 . Since CAISO's 2007 study of renewable energy Integration into the transmission grid did not 
consider the costs of integration, will CAISO estimate these costs, and, if so, when? 

CAISO aligns itself to assist and enable the state to achieve its established policy goals. 
Although CAISO estimates costs of the transmission projects needed to meet California 
renewable resource requirements, making such costs transparent as they arise. Projections of 
total costs to California consumers of integrating renewable energy into California's electricity 
supply should be undertaken by the California's energy regulatory agencies and electric load 
serving entities, in cooperation with CAISO. 

12. How does this action [CAISO board approval in December 2007 of CAISO filing tariff 
amendments with FERC to comply with FERC directives mandated in Order 890] - which could 
be viewed as making CAISO a "grid builder"- reconcile with CAISO's current practices as "grid 
manager"? 

FERC issued Order 890 to address the potential for undue discrimination and preference in 
provision of transmission service by all service providers, including ISO's. At that time, CAISO's 
transmission planning process was already largely consistent with Order 890 requirements. 
After a stakeholder process, CAISO filed proposed tariff amendments, which were approved by 
the board, that clarified and refined its transmission planning process. This CAISO filing did not 
significantly add to CAISO policy or existing authority. CAISO is not a "grid builder." It plays a 
proactive role in transmission planning, in cooperation with the CPUC, CEC and other state 
agencies, including evaluation of the reliability and economic benefits of proposed expansion 
projects which will increase grid reliability, reduce congestion costs, and facilitate incorporation of 
renewable energy sources into CAISO's wholesale power markets. The CAISO board reviews 
and approves proposed major transmission projects which will be constructed and owned by 
other entities. 

13. How is this action [CAISO board approval above in answer to 12] consistent with federal and 
state directives on transmission planning? 

CAISO's transmission planning policy is, as noted in answer to 12 above and 14 below, 
consistent with and in furtherance of federal and state policy directives. 

14. How will this action [CAISO board approval above in answer to 12] prevent undue discrimination 
and preference in transmission service? 

FERC Order 890 mandated that all transmission planning processes comply with specific 
principles, including coordination, openness, transparency, information exchange, comparability, 
regional participation, economic studies, and cost allocation. FERC has determined that 
CAISO's Order 890 tariff filing, which was approved by the board in December 2007, to be 
consistent with the principles specified in Order 890. 



102 



Senate Confirmation 
Responses to Senate Rules Committee Questions 

Doug P. McKeever 

Director, Juvenile Programs 

Division of Juvenile Justice 

California Department of Corrections and Rehabilitation 

July 17,2008 



Goals 

1 . Please provide us with a brief statement of goals. What do you hope to 
accomplish during your tenure? What program improvements are you 
proud of accomplishing thus far? How will you measure your success? 

As Director of Programs, my goals are: to ensure that each youth receives the services 
needed while under the care of the Division of Juvenile Justice (DJJ) and to prepare 
them for successful transition back into their community. During my tenure, 
I hope to accomplish the following: 

• Increase the proficiency level of the students attending school in the core 
academic subject areas; 

• Increase the graduation rate of students attending high school; 

• Increase the percentage of students passing the California High School Exit 
Exam; 

• Develop and implement an integrated health care system to ensure youths 
receive the medical, dental, and mental health care required; 

• Develop and implement evidence based programs designed to meet the 
needs of our youths as defined by an individual youth assessment profile; 

• Foster ongoing working relationships with the Superintendents of each facility; 

• Foster ongoing working relationships with stakeholders in the community. 

The program improvements that I am proud of accomplishing thus far include the 
following: 

• Entry into a national recruitment effort to hire the Superintendent of Education 
for the DJJ. As of this submission, final candidates are being interviewed; 

• Review and approval of the Program Service Day that will be piloted at the 
Preston Youth Correctional Facility in August 2008. This pilot will coordinate 
programs, education, and medical care to ensure staff maximize the services 
provided to our youths; 

• Review and approval of the Suicide Prevention and Response Policy to 
ensure the most mentally ill youths receive the oversight required to remain 
safe during a difficult time in their lives; 

• Modification of two important contracts within the mental health program and 
the education program; 

Senate Rules Committee 

JUL 1 ? 2008 103 

Appointments 



Senate Rules Committee . July 17, 2008 

Doug P. McKeever 
Page 2 of 22 



• Modification of the working hours of our senior mental health clinicians as a 
pilot at Ventura Youth Correctional Facility to better meet the needs of our 
youths; 

• Modification of the working hours of our Chief Medical Officers to ensure 
medical care is effectively provided; 

• Establishment of a working relationship with the Chief Civil Rights Attorney, 
United States Department of Education, Office for Civil Rights; 

• Establishment of a working relationship with the Deputy Superintendent of 
Education for the Sacramento County Office of Education; 

• Establishment of a working relationship with the Chief Probation Officer of 
Sacramento County and the Deputy Chief Probation Officer of San Diego 
County; 

• Engagement with the University of California, San Diego, school of Psychiatry 
in an effort to develop internship and fellowship programs to attract 
Psychiatrists into the DJJ; 

• Engagement with the California State University of San Francisco, school of 
Health and Human Services, to develop a correctional component for their 
schools of Psychology and Social Services. 

The measurement of my success, or more importantly, the success that is translated to 
the youths we serve, is predicated upon the development and ongoing review of data. 
Critical indicators have been developed to measure each of the goals identified in the 
remedial plans, with the outcome being an ability to demonstrate improvement. 
This data will permit me to determine if an area is not working well, and will, therefore, 
allow me the ability to quickly modify and/or enhance a specific area. 



Background 

The 2005 reorganization of the Department of Corrections and Rehabilitation created 
the Division of Juvenile Justice (DJJ). The number of juvenile offenders being sent to 
state facilities has dropped sharply over the past decade, with the population in 
state juvenile facilities going from 10,000 a decade ago to a projected 1,700 by 
June 30, 2009. The most recent drop in population is due to the passage of SB 81 
(Senate Budget and Fiscal Review Committee), Chapter 1 75, Statutes of 2007, under 
which nonviolent and nonserious offenders are remaining at the local level. At least two 
juvenile facilities, DeWitt Nelson Youth Correctional Facility in Stockton and El Paso de 
Robles Youth Correctional Facility in Paso Robles, are due for closure. 

2. What are the most significant road blocks to improving programming 
for youthful offenders? 

There are several significant roadblocks that need to be addressed in order to improve 
programming for youthful offenders. First, and one of the most critical factors, is the 



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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 3 of 22 



culture of a department that is rich in a history of security. The efforts to change this 
culture to one focused on treatment while still ensuring safety and security has a direct 
bearing on our ability to successfully provide services to our youths. It is imperative that 
staff understand that how they behave and interact with the youths directly impacts how 
the youths behave and interact with them. The second is just as rich in history and that 
is the physical makeup of the facilities in which our youths reside. The facilities are old 
and were never designed to accommodate the vast array of programs required, or the 
living accommodations necessary, for the implementation of successful reform. 
Lastly, our youths are older and farther along in their criminal history, more gang 
entrenched and have more co-occurring disorders. This is not so much a roadblock as 
an additional challenge we face in our efforts to provide programs. 

3. How do you ensure safety from gangs and violence so that youthful 
offenders will feel secure to participate in treatment programs? 

The DJJ performs a battery of assessments for each youth who comes into our system. 
Upon intake, classification and clinical reviews help determine the appropriate housing 
for each youth. A portion of this intake process involves research of a youth's peer 
associations in the community, and if a determination is made that the youth's history 
reflects association, affiliation and/or member status of a gang sub-culture, the facility 
Gang Information Coordinator will conduct an interview with the youth to verify the gang 
status. The Department does not provide program assignments based on gang 
identification. Rather, program assignments are based on identified treatment needs 
and observable and documented behavior. 

If a youth's behavior is violent towards others, then the youth will be referred to a more 
secure environment in an effort to provide those youths who wish to participate in 
programs, the opportunity to do so without the threat of violence from youthful offenders 
that have demonstrated predatory and/or victimizing behaviors. 

The Gang Information Coordinators work collaboratively with the recently implemented 
Crisis Response Team staff in an effort to investigate and mitigate potential conflicts 
between the various gang and racial groups. This relationship has proven beneficial for 
youths returning to a core treatment program from a more structured environment. 

Additional steps taken to address this issue are: reduction of the size of living units 
while increasing our staffing; separation of youths into high and low risk living units; and 
the implementation of the case manager positions that will ultimately oversee an 
individual youth's treatment plan. 

In addition, the Department has engaged the assistance of community-based 
organizations such as Project Impact in all facility environments. Project Impact 
provides intervention and counseling services above and beyond what youth receive in 
their treatment program. Project Impact is voluntary and provides additional 
perspectives on decision making, impulse control, and acting as responsible individuals. 

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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 4 of 22 



With all of these efforts, the ongoing dialogue between facility staff of all disciplines is 
critical to ensure that this very complex problem is addressed timely. This includes 
ongoing updates to the Director of Facilities and me to ensure the youths feel safe and 
secure while attending programs. 

4. What input do you seek from offenders and staff about program needs? 
What steps have you taken to implement suggestions from these 
sources? 

Seeking input from staff about program needs is a basic component of my leadership 
style. There are several methods used to gather this information. 

The primary source of information about what is happening in the field is from those 
working directly with the youths. I encourage staff to provide me with feedback regularly 
regarding whether they feel programs are working. Although in the short time that I have 
been in my position, it is apparent that there is a disconnect between staff in the field 
and staff at headquarters, I work closely with the managers in each of my different 
disciplines to ensure that their feedback reaches me and that I am available as a 
resource. 

One notable example of this is the work I did with the teachers at 
N.A. Chaderjian High School (Chad). On my first visit I spent my time touring the entire 
facility, including the living units, school, clinics, and medical complex. This tour did not 
allow me enough time to meet with groups of staff, yet I made a commitment to return 
once my initial visits were completed. The teachers at Chad indicated that they did not 
believe I would return. In early May, I made an appointment with the teachers at Chad 
and spent two hours listening to their concerns and issues. From this meeting I made 
the commitment to return on a quarterly basis to meet with them, and followed-up on 
one of their training requests by asking the Chief of Mental Health to develop an 
in-service training session so the teachers could better understand the signs and 
symptoms of mentally ill youths. 

In my view, it is clear that one of the reasons that staff in the program area are 
disconnected from headquarters is that the Director of Programs position remained 
vacant for so long. Staff in the facilities fended for themselves due to a lack of an 
administrator in this area. I have taken the following steps to bridge that gap and build a 
collaborative relationship with the field: 

• Visited each facility. The following provides a list of facilities and the number 
of visits to each since my arrival: 

o DeWitt Nelson Youth Correctional Facility - two visits 
o El Paso de Robles Youth Correctional Facility - two visits 
o Herman G. Stark Youth Correctional Facility - three visits 
o N. A. Chaderjian Youth Correctional Facility - five visits 

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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 5 of 22 



o O.H. Close Youth Correctional Facility - three visits 

o Pine Gove Youth Conservation Camp - one visit 

o Preston Youth Correctional Facility - two visits 

o Southern Youth Correctional Reception Center - one visit 

o Ventura Youth Correctional Facility - two visits 

• Spent a considerable amount of time talking with the Superintendent of each 
facility to understand what they have been undertaking in the area of 
programs for the youths; 

• Looked for efforts undertaken at individual facilities that may be replicated at 
other sites. Examples include the Peace and Unity Program at the Southern 
Youth Correctional Facility and the Family Justice pilot project at OH Close 
Youth Correctional Facility; 

• Committed to the staff at each facility that I have made it a priority to visit 
them on a regular basis. 

In addition to seeking input from the staff, I feel it is important to seek the input of our 
youths as well. I feel that their perspectives are valuable in determining program 
effectiveness and whether their needs are being met. As I visit the facilities, I make a 
point of speaking to the youths to gain their input. The youths also have an established 
advocate with the Office of the Ombudsman. This office serves as another important 
source of information. As they do their walkthroughs of facilities, they seek the feedback 
of the youths and of the staff. This information is brought back to headquarters and 
reported through the management team meetings. The Ombudsmen meet regularly with 
Student and Youth Family Councils, and invest these groups with their roles as 
stakeholders in our system. The feedback from the youthful offenders and their families 
is a strong indicator of the success of our programs. 

In fact, as indicated above, the pilot program conducted at OH Close Youth Correctional 
Facility, was aimed at identifying and destroying the barriers that families face in 
accessing our system. We experienced such a potential for a true collaboration with our 
youths and families, with the goal of rehabilitating the youth, that we will be rolling out 
this pilot program statewide by next fall. 

I have an open door policy with the Office of the Ombudsman, and expect that as the 
youthful offenders reach out to them in the facilities or through the new toll-free number 
that is available to all youth, we will continue to receive their feedback on the successes 
or shortcomings of our programs. To facilitate this process, I have established monthly 
meetings with the Office of the Ombudsman to ensure on-going communication. 



Population Shifts 

Under legislative changes, the state is providing block grants to counties to offset costs 
of juvenile offenders. The state also has discussed moving about 130 young women 

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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 6 of 22 



and girls from the partially occupied Ventura Youth Correctional Facility, the only such 
state institution to incarcerate girls and young women. 

5. How do you ensure that youths are receiving the appropriate level of 
services from county agencies? What impact has this had on treatment 
services in state facilities? 

While the DJJ does not have any direct oversight or monitoring responsibilities to 
ensure that youth receive appropriate services from county agencies there are several 
efforts that we have taken to facilitate the transfer and likelihood that services are 
provided to youth. Specifically, the DJJ Intake and Court Services (ICS) Unit has been 
designated as liaison for all county probation departments. ICS provides the counties 
with information about youth pending release to assist the probation department in 
developing transition plans. One of the ways that the DJJ mental health team assists in 
this effort is by providing a mental health summary report. This report describes any 
mental health services that a youth may have received while in a DJJ facility so that the 
county can develop a plan to address the needs in the community. Additionally, DJJ 
parole has provided the counties with lists of all group home providers to assist the 
county in developing resources for these youth. 

The ICS unit also coordinates with the Corrections Standards Authority (CSA) and has 
provided input to CSA on requests by counties for additional funding. ICS provides the 
CSA with a list of each non Welfare and Institutions Code (WIC) §707(b) youth that has 
been transitioned out to a particular county, and designates what action the county took 
at the initial court transfer process. The list identifies for CSA whether the juvenile court 
continued probation supervision services or terminated probation services at the time of 
transfer from DJJ. 

Lastly, while the DJJ or CSA were not given direct oversight for monitoring the 
realignment process, this issue has been discussed at the State Commission on 
Juvenile Justice. The purpose of the commission is to provide comprehensive oversight, 
planning, and coordination of efforts, which enhance the partnership and performance 
of state and local agencies in effectively preventing and responding to juvenile crime. 

The commission is scheduled to complete an operational master plan by January 2009 
that may contain recommendations that address appropriate levels of services and the 
coordination of those services on a statewide basis. 

6. What role would DJJ play in monitoring the treatment of female wards in 
county or private facilities? 

The DJJ is currently developing a Request for Proposal (RFP) to solicit bids from 
outside vendors for the purpose of contracting services for our female youthful 
offenders. The RFP will contain a viewing and monitoring component in which DJJ will 



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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 7 of 22 



be required to visit, validate and confirm the program components and physical site of 
the potential vendors. 

The DJJ will develop a plan, policy and monitoring tool to ensure all laws and other legal 
mandates are in compliance once a contract is awarded to a vendor. 



Juvenile Justice Reform 

In 2004 the administration reached a landmark settlement in the Farrell lawsuit on the 
conditions of confinement in juvenile facilities. DJJ is supposed to implement a broad 
array of reforms, including creating smaller living units, improving education and mental 
health services, and bolstering safety. 

A year ago, in advance of his confirmation, Jim Tilton, the former secretary of CDCR, 
said he was "excited about the opportunity to implement reform to reduce the size of 
living units and enhance our staffing model so that DJJ can fully implement an 
integrated behavior treatment program. This includes assessment and classification 
instruments developed specifically for the DJJ population. In addition, DJJ reform will 
increase family involvement, improve our conflict resolution options and better allow us 
to meet the individualized treatment needs of youth. " 

In February 2008, however, lawyers representing juveniles in the Farrell case urged a 
judge to name a receiver to run the system they say remains broken. They contend that 
DJJ has missed dozens of court-ordered deadlines for change dating back to 2005, 
making "a mockery of compliance" in six areas: education, safety, medical care, mental 
health, disabilities, and sex offender treatment. The state has acknowledged missing 
some deadlines but says in court documents it has "made substantial progress. " 

7. What is the status of the Farrell lawsuit? What is your role in 
monitoring the implementation of the juvenile justice reform efforts 
required by the court in the Farrell lawsuit? Specifically, how do you 
track progress? 

The status of the Farrell lawsuit involves several areas of discussion. The first is the 
Order to Show Cause Hearing that was prompted by the Prison Law Office alleging that 
the DJJ was unable to implement Farrell in a timely manner due to issues in the areas 
of personnel, budget, information technology, and contracts. Testimony began in 
April 2008, with final arguments scheduled for later in July. 

The second area of Farrell status involves the ongoing efforts to accomplish the 
commitments made in the Remedial Plans submitted to the court in the areas of: Safety 
and Welfare; Wards with Disabilities; Education; Sex Behavior Treatment; Mental 
Health; and Medical. Each of these plans is in various stages of implementation, with 
most behind schedule of their original time commitments. To address this issue, the DJJ 

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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 8 of 22 



has embarked upon the implementation of a standard project management 
methodology. The outcome of this process is to reevaluate existing due dates and 
revise them using a project management approach. This approach will ensure that the 
scope of the project is clearly identified, that adequate planning is undertaken to ensure 
required resources and dependencies are identified, realistic timeframes are assigned 
to each activity, proper monitoring efforts are put in place to measure progress, and 
finally, that documentation and lessons learned are captured. 

My role in monitoring the implementation of the juvenile justice reform efforts is primarily 
driven by the efforts undertaken in the Education, Sex Behavior Treatment, Medical, 
and Mental Health Remedial Plans. There is however, a great deal of overlap with the 
Wards with Disabilities and Safety and Welfare Plans that require my awareness and 
attention. I undertake several approaches to track progress with all these efforts. 

The first is the ongoing review of the court appointed experts' reports that are filed after 
each facility visit. These reports are translated into useful data tools that allow me to 
see, by facility, both high level performance as well as individual and discrete audit 
items. From these reports, decisions can be made on where to prioritize efforts and 
apply resources to make improvements. In addition, these reports allow for the 
identification of what is being done well and where so that other facilities can learn from 
these efforts. 

Please see the attached six charts that represent a sampling of the data that I use to 
manage Juvenile Programs. 

The second method I use to track progress is through my management team. 
This senior leadership team is responsible for providing me with weekly updates on their 
efforts in implementing the provisions of Farrell. Reports are generated from each 
facility that highlight key indicators, examples of such reports include: student 
attendance, corrective action plans; medical and mental health reports; audit and 
compliance findings; incident reports; and temporary detention program reports. 

Lastly, as the DJJ implements the project management processes, regular executive 
sponsor meetings will be scheduled in order to track the progress of the activities 
identified in each project plan. This effort will enable us to be proactive in addressing 
issues as they arise, mitigating risks, and making timely decisions on courses of action 
in advance of a project that may be getting behind schedule. 

8. How will implementation of the Farrell case be impacted by DJJ's 
reduced population and the shift of juvenile inmates to county facilities? 

The implementation of the Farrell case will be impacted in several ways by the DJJ's 
reduced population and the shift of juvenile wards to county facilities. 
The reduction in population affords the DJJ the opportunity to implement the agreed to 



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Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 9 of 22 



living unit sizes for the various populations that we serve. The Remedial Plans require 
the following living unit sizes: 

Core Treatment - Low Risk - 38 

Core Treatment - High Risk - 36 

Sex Behavior Treatment Programs - 36 

Substance Abuse Treatment Programs - 36-38 (depending on risk level) 

Special Counseling Programs - 24 

Intensive Treatment Programs - 24 

Intensive Behavior Treatment Programs - 20 

Behavior Treatment Programs - 24 

Based on the reduction of the living units, overcrowding issues that once plagued the 
Department are no longer a major issue. In addition, the extra space on the living units 
is being used for staff to conduct various programming efforts like individual or group 
sessions and education. 

As a result of Senate Bill 81, the DJJ believed that many counties would recall their 
commitments and that these youths [committed for non WIC §707(b) offenses] would be 
transferred to the county facilities. However, the number of youths expected to return 
to the counties did not materialize as quickly as thought. As of June 30, 2008, 
364 non WIC §707(b) youthful offenders were returned to the communities from DJJ, 
and 332 non WIC §707(b) youthful offenders still remain in the DJJ. While these youths 
are with the Department, they will continue to receive the programs required under 
Farrell. It is expected that all these youth will return to their counties upon parole thus 
further reducing the number of youthful offenders within our system. 

With the reduction in population and the eventual return of all non WIC §707(b) youths, 
another impact is that the vast majority of the youths remaining in DJJ's care are higher 
risk and higher need requiring a greater level of attention. For example, the type of 
offenses the youth has committed, are more serious in nature given WIC §707(b) 
offenders are convicted of more serious crimes such as murder, rape, and arson. 

9. What is the status of the reform plans outlined by Mr. Tilton during his 
confirmation? 

Mr. Tilton indicated that additional resources were provided to the DJJ and that, in fact, 
has occurred. We have a Director of Administration and Operations that oversees staff 
who provide direct support in the areas of personnel, contracts, project management, 
and policy development. In addition, Mr. Tilton indicated that he fully supported the 
reduction of living units and enhanced staffing, "so DJJ can fully implement an 
integrated behavior treatment program." To date, the DJJ has enhanced the staffing 
levels, accounting for 1,200 additional staff to meet the remedial plan commitments. 
In addition, the DJJ is making progress in reaching each living unit size to comply with 
the Farrell levels. 

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Senate Rules Committee 
Doug P. McKeever 
Page 10 of 22 



July 17, 2008 



The following chart represents those efforts. Note: the Intensive Behavior Treatment 
Program and the Behavior Treatment Program are still in development and therefore 
reflect percent compliance: 



POPULATION 
CAPS 



NUMBER OF 

LIVING UNITS 

OPEN 



LIVING UNITS 

IN 

COMPLIANCE 

WITH CAPS 



PERCENTAGE 

IN 
COMPLIANCE 



CORE TREATMENT - LOW RISK 


38 


11 


9 


82% 


CORE TREATMENT - HIGH RISK* 


36 


13 


7 


54% 


SEX BEHAVIOR TREATMENT 
PROGRAMS 


36 


6 


2 


33% 


SUBSTANCE ABUSE TREATMENT 
PROGRAMS 


36-38 


4 


4 


100% 


SPECIAL COUNSELING ROGRAMS 


24 


4 


2 


50% 


INTENSIVE TREATMENT 
PROGRAMS 


24 


5 


5 


100% 


INTENSIVE BEHAVIOR TREATMENT 
PROGRAMS 


20 








0% 


BEHAVIOR TREATMENT PROGRAMS 


24 








0% 



* Includes Special Management 
Programs and Intensive Treatment 
Programs 

Mr. Tilton also indicated the importance of increasing family involvement and conflict 
resolution options. As described previously, the potential for collaboration with 
the youthful offenders and their families realized through the pilot project at OH Close 
Youth Correctional Facility has provided plans to roll out this pilot program statewide 
by next fall. 

As for the conflict resolution efforts, the DJJ recently implemented conflict resolution 
teams at each facility. These teams are responsible for working collaboratively with the 
youths and staff in addressing issues that might otherwise escalate. 



112 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 1 1 of 22 



10. Two years ago, the outside experts retained by the department 
recommended changes to the restrictive housing units, known as 
"special management programs," and that you institute a standardized 
record keeping system for these units. These "special management 
programs" have been criticized for having isolation conditions even 
harsher than those in adult facilities. What specific programming 
happens in "special management programs, " and have you personally 
monitored it? How many hours are offenders out of their rooms? Do 
they have time in day rooms? What have you done to increase 
educational and recreational opportunities for youthful offenders? 

As designed, Special Management Programs were put in place to address those youths 
who exhibit a high level of behavioral issues. However, this placement option does not 
absolve the DJJ from providing the required programming to the youth. 
At present, the following provides a list of the various programs offered in the Special 
Management Program: 

• Education 

• Mental Health 

• Medical 

• Interactive Journaling that includes: 

o Individual Change Plan 

o Maintaining Positive Change 

o Handling Difficult Emotions 

o Family Dynamics 

o Substance Abuse 

o Relationship Skills 

o Personal Inventory and Life Skills 

o Getting the Right Job 

o Life Skills 

o Victims Awareness 

o Values 

o Gang Awareness 

• Individual and Group sessions in areas such as: 

o Anger Management 

o Sex Behavior Treatment 

o Life Skills 

o The Offender Cycle 

o Impulse Control 

o Criminal Thinking 



113 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 12 of 22 



As for monitoring, the following efforts have been undertaken: 

• Outside room time has been established at a minimum of three 
hours for all restricted programs (August 24, 2007, memorandum from 
Director of Facilities, Sandra Youngen). To monitor this, each facility is 
required to provide a weekly Temporary Detention Program Report to the 
Director of Facilities in which I receive a copy. This report identifies the total 
mandated services records for the week, the total records with time out of 
room deficiencies, and the percentage of total records with time out of room 
deficiencies. If the report does not indicate 100 percent compliance, the 
Superintendent is required to provide a written explanation and analysis 
within three working days to the Director of Facilities. 

• To further emphasize the importance of need for our youth to get out of their 
room and receive the required programs, On May 30, 2008, a joint 
memorandum from myself and the Director of Facilities was distributed to all 
Superintendents, Principals, and Health Care Managers outlining our 
expectation that they work collaboratively to ensure that youth, including 
those in the Special Management Programs, receive the services 
required. If issues cannot be addressed at the facility level, then the 
Director of Facilities and I would respond to ensure the issues are addressed 
timely. The way in which we would become aware of this is through the 
weekly conference calls with the Superintendents in which the Director and I 
participate or during my weekly management team meetings where I have 
asked that this information be discussed and addressed. 

With respect to the number of hours that youths spend out of their rooms, the following 
information provides the number currently housed in the Special Management 
Programs, the average length of stay, and the average time spent out of their rooms: 

As of July 4, 2008, the following reflects the number of youths assigned to a Special 
Management Program: 

N. A. Chaderjian Youth Correctional Facility 9 
Herman G. Stark Youth Correctional Facility 38 
Preston Youth Correctional Facility 28 

Between April 1, 2008 and June 30, 2008 (Second Quarter), the following reflects the 
average length of stay in a Special Management Program: 

N. A. Chaderjian Youth Correctional Facility 47 days 
Herman G. Stark Youth Correctional Facility 47 days 
Preston Youth Correctional Facility 66 days 



114 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 13 of 22 



From June 15, 2008 through 21, 2008, the following reflects the average time the 
youths spent out of their rooms: 

N. A. Chaderjian Youth Correctional Facility 164 minutes* 
Herman G. Stark Youth Correctional Facility 180 minutes* 
Preston Youth Correctional Facility 177 minutes* 

*The averages do not reflect an accurate picture. Examples include: the time a youth 
arrives in the program may preclude them from participating in the mandated three 
hours for that day and thus the data reflects no hours of time out of the room; also, if a 
youth refuses to participate in out of room activities the data reflects no hours out of 
the room. Both of these examples will result negatively impact the average. 

11. How many offenders spend time outside of living units on a daily basis? 
What steps have you taken regarding outdoor exercise cages? 

All youth are provided the opportunity to spend time outside of their living units. 
This time consists of school attendance, individual and/or group sessions, medical 
services, mental health services, personal hygiene, recreation, religious services, 
visiting, and meals. There are times when a youth voluntarily declines these 
opportunities and the Department documents each of those. 

In cases where a youth's behavior is assessed as a threat to others, or jeopardizes the 
safety and security of the facility, restrictions are placed on that youth's opportunity to 
participate in daily activities. Again, when these issues occur, the DJJ documents such 
events. 

As for the outside exercise yards, the planning for outside secure recreational areas is 
underway. For example, there will be larger areas than what is provided now for those 
youth assigned to restricted living units. These areas will have no-climb material on the 
fence and will have an open top with sections covered for shelter from the elements. 



Recognizing that Bernard Warner, Chief Deputy Secretary, Juvenile Justice, and his 
staff have to work within the size constraints of existing facilities until modern 
replacements can be built, outside experts retained by the Department recommended 
that existing housing units of 36 to 38 beds be divided into two sections whenever 
possible. In a 2006 letter to the Senate Rules Committee, Mr. Warner predicted that by 
last June, a visitor would be able to walk through new core treatment facilities and find 
youth involved in education and other programs outside of their rooms for most waking 
hours. 



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Senate Rules Committee 
Doug P. McKeever 
Page 14 of 22 



July 17,2008 



12. In your view, what is the optimum size of a housing unit, and how close 
are you to reaching that goal? 

In my view, the optimum size of a housing unit is dependent upon our ability to provide 
the necessary services, along with a safe environment for staff and youth alike. 
The housing unit size as identified in the response to question eight is a very good 
starting point in which to measure our efforts. 

As we move forward, the determining factor of an optimum living unit size will be 
measured by the results of our efforts to provide adequate services to the youth within 
those living units. The DJJ is closer to meeting the living unit sizes. As we realign our 
population and open new programs such as the Behavior Treatment Program, the DJJ 
will reach each of the living unit size. 

As also provided in response to question nine, the following chart indicates DJJ's efforts 
in providing adequate services within the living units: 

LIVING UNITS 

NUMBER OF IN PERCENTAGE 

POPULATION LIVING UNITS COMPLIANCE IN 

CAPS OPEN WITH CAPS COMPLIANCE 




CORE TREATMENT - LOW RISK 


38 


11 


9 


82% 


CORE TREATMENT - HIGH RISK* 


36 


13 


7 


54% 


SEX BEHAVIOR TREATMENT 
PROGRAMS 


36 


6 


2 


33% 


SUBSTANCE ABUSE TREATMENT 
PROGRAMS 


36-38 


4 


4 


100% 


SPECIAL COUNSELING ROGRAMS 


24 


4 


2 


50% 


INTENSIVE TREATMENT PROGRAMS 


24 


5 


5 


100% 


INTENSIVE BEHAVIOR TREATMENT 
PROGRAMS 


20 








0% 


BEHAVIOR TREATMENT PROGRAMS 


24 








0% 



* Includes Special Management 
Programs and Intensive Treatment 
Programs 



116 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 15 of 22 



13. Where are you now relative to Mr. Warner's prediction? Please describe 
what you believe the juvenile division will look like a year from now and 
five years from now. 

In June 2006, Mr. Warner predicted that, "One year from now, you will be able to walk 
into two of DJJ's eight facilities and find a markedly different environment. By the end of 
the next fiscal year, we will complete the conversion of Chad to a specialized treatment 
facility. Chad will no longer serve as the 'end of the line' facility as it once was. Instead, 
it will be comprised of specialized programs for youth with mental health needs and for 
youth needing sex behavior treatment." 

I believe we have reached many of the predictions as described by Mr. Warner. 
There is no doubt that the environments of the current six facilities are very different 
from what it was in 2006. As an example, on June 30, 2006, Chad's population 
was 311, as of the June 30, 2008, the population was 211. In June 2006, Chad was 
one of the most challenging facilities to manage. Today, we have begun to implement 
the specialized programs for mental health and sex behavior treatment and Chad is no 
longer one of the most challenging facilities to manage. At Chad, in the first quarter 
of 2006, the number of youth involved in incidents of violence was 56. In the first 
quarter of 2008, the number of youth involved in incidents of violence was 30. 

During the next year I believe we will reach our living unit sizes, implement policies that 
will result in our youths receiving better mental health care and educational services, 
and staff will be trained in areas that will enable them to actively engage with the youth 
in all settings. In addition, every facility has hired multiple cases mangers who will be 
assigned to youth whose sole responsibility will be to implement and manage the Youth 
Assessment Screening Inventory. This inventory will provide an initial risk profile of the 
youth and will be measured every 120 days to ensure the appropriate programs are 
being offered. This inventory will also measure the success of those efforts. 

In five years, our staff will be fully engaged with the youth under our care. All youth will 
receive the programs that they need to be successful while with us, and more 
importantly, the programs that will allow them to be successful after their release back 
into their communities. 

The culture of the DJJ will have shifted from one of a correctional model to one that is 
based on treatment. If funding is secured, new facilities will be built, or existing facilities 
will be modified to address the needs of our youths. We will have living units that allow 
for the flexibility to provide services to both high risk as well as low risk youth alike. 
Not only will these facilities provide all the programming and office space required, they 
will have adequate health care space to provide the necessary medical, dental, and 
mental health services. 



117 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 16 of 22 



Coordination 

With planned closures, you will oversee programs in a half-dozen facilities scattered 
throughout different parts of the state from Stockton to Chino. 

14. When you visit facilities, what are the benchmarks you look for to 
measure whether offenders are programming efficiently, such as 
regularly attending class? 

Before I visit a facility, I gather data on the various programs administered at that facility 
to get a better understanding of how they are performing. This data may be what is 
already measured either by the Farrell experts or by our staff, or it may be information 
gathered through conversations I have had with key stakeholders, such as the Office of 
the Ombudsman. 

Once on site, I meet with the Superintendent, Chief Medical Officer, and Principal. 
I get a sense from them of the current issues they are facing, and more importantly, I 
get a sense of how they are working as a team to address the day-to-day activities of 
the facility. As I visit each area of the facility I talk with staff and youths to get their 
perspectives as well. 

There are several key benchmarks that I look for during my visits: 

• Are youth are out of their rooms and participating in school, treatment groups, 
recreation, work assignments and other social activities; 

• Are rooms clean; 

• Is the facility clean; 

• Are the youth well groomed; 

• Are the staff actively engaged with the youth; 

• Does the staff know the youth on their living unit and do they know their 
needs; 

• Is staff actively engaged with each other to know the needs of the youth; 

• Are treatment team meetings taking place. 

15. Who is responsible for initiating programs? What role do 
superintendents play? Can a superintendent start an academic or 
vocational program or self-program, or must they clear that action with 
headquarters? How often do you meet with superintendents? 

I firmly believe that program development and initiation is an undertaking that has to be 
done in a collaborative effort between all staff within the DJJ. Every staff person should 
feel empowered to suggest improvements to existing programs, or suggest alternative 
approaches that may result in better services to the youth. Nothing should be developed 
in a vacuum, either at the facility level or at headquarters. 



118 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 17 of 22 



With this in mind, if a Superintendent has an idea for an alternative approach or 
program that will better serve the needs of the youth, I would expect them to work with 
the leadership team at the facility, and in consultation with the leadership team at 
headquarters, scope out the details of the proposal and recommend what efforts they 
believe can be undertaken. 

I believe the primary role of staff in headquarters is to review the proposals in context of 
the broader statewide efforts either underway, or those that may be in the planning 
phases, and seek out the necessary resources to achieve the desired results. 

As for how often I meet with the Superintendents, I participate in weekly conference 
calls with all the Superintendents, attend the quarterly Superintendents meetings, meet 
with them individually during my visits to their facility, and will talk with or meet with 
them at any time when the need arises. 



Staffing and Training 

Over time, national experts who studied the division said the juvenile system has come 
to reflect a miniature version of the adult prison world. Without the capacity to manage 
reform, they said, needed changes will not occur in organizational structure and 
appropriate management culture. 

16. In 2006, Mr. Warner indicated that by fiscal year 2009-2010 you would 
need an estimated 1,400 new staff. Is that estimate still accurate, or has 
it changed? 

Much has changed since 2006 when Mr. Warner made his predictions. 
The DJJ has experienced a reduction in population and as recently as this month, has 
closed two facilities. However, the number of staff needed to serve the youth is driven 
by a staff to youth ratio that was agreed to in each remedial plan. Therefore, given our 
population has gone down, the corresponding number of staff required has slightly 
decreased since Mr. Warner's prediction. 

To date, an estimated 1,200 new staff have been authorized to fulfill the youth to staff 
ratio agreements. The breakdown is as follows: 

Safety and Welfare - 589 

Education - 235 

Mental Health - 224 

Health Care -108 

Sex Behavior Treatment - 33 

Wards with Disabilities - 1 1 



119 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 18 of 22 



It should be noted that the DJJ under the direction of the Administration and Operations 
Division, will be performing a staffing reconciliation project once the population 
realignment and closure processes are completed. This project will ensure our staffing 
is in alignment with the remedial plans. 

17. To better inform their decisions, do you brief members of the Juvenile 
Parole Board on the type of programs offered in your institutions? 

I attend the Juvenile Parole Board meetings on a regular basis to provide overviews and 
updates, and to address the commissioners questions and concerns, related to 
programming in the facilities. In addition, I assist the Board by arranging more in-depth 
training by the professionals on my staff at headquarters and in facilities, and 
consultants, on issues such as the new risk needs assessment instrument, and 
programming associated with the integrated behavior treatment model. 

18. Since your appointment, what have you done to help the staff 
understand the value of a culture of treatment? 

In order for staff to fully understand the value of a culture of treatment, they must first 
understand that the culture of the DJJ has changed from one that was based on a pure 
correctional model to one that is built upon a treatment model. 

When I visited each facility for the first time, I asked staff if they understood the 
conceptual change and what role they play in supporting this effort. In cases where 
staff may not have been fully aware, I spent the time explaining the reasons why we are 
focusing on the youth, with much of the conversation around the need to deal with the 
underlining factors behind the behavior that led them to their commitment with us. 
Ongoing communication is required when changing the culture of any organization. 
Therefore, my efforts to communicate the value of treatment are also ongoing. I take 
advantage of every opportunity to reinforce the reasons why we are changing and what 
staff can do to assist in that effort. 

Lastly, the DJJ is providing a lot of training to staff to support the treatment culture. 
These training sessions provide staff with the tools to engage youths in a proactive and 
positive manner, thus building upon the foundation of a treatment model. 

Through June 2008, over 2,400 staff has been trained in a variety of subject areas as 
indicated in the following chart: 



120 



Senate Rules Committee 
Doug P. McKeever 
Page 19 of 22 



July 17, 2008 



Number of Staff Trained by Subject Area Through June 2008 



800 

700 



200 

100 



■ Direct Care Staff (1736) 

■ DJJ Instructors (155) 

■ Management (571) 
2,462 total staff trained 



Be^ 






Eft 



Aggres sion Repla cement Understanding 4 Reventing Safe Crisis Mana gement Crisis Intervention & Conflict Motiv ational tite rview ng ORBS (Various S ubjects) 
Suicide I AAf) I Resolution 



286 



339 



Training 



273 



855 



269 



19. Have you acted since your arrival to ensure that employees in juvenile 
justice institutions and parole offices around the state have direct and 
effective access to you? If so, how? 

My visits to each facility within the first 90 days and subsequent visits to the facilities 
have demonstrated my commitment to be accessible to staff. Part of my goal in visiting 
each facility was to introduce myself to staff and ensure that they knew I was 
accessible. 

In addition to facility visits, I participate in meetings that are intended to bring facility 
staff and headquarter staff together. Examples include the monthly Principal's meeting 
and quarterly Health Care Leadership meetings. 

I also fulfilled a request made by the teachers at Chad during my first visit to come back 
and meet with them. I committed to doing so once my remaining facility visits were 
completed, and I did so. 

Other examples include conversations with staff by phone and e-mail who want to share 
information, raise concerns and/or issues, or seek guidance. When I return phone calls 
or e-mails, staff have said they were surprised that I directly responded to them. I have 
committed to be responsive and to be so in a timely manner. 

Given my first priority was to visit each facility, I have not yet had the opportunity to visit 
each parole office. However, I have a very good working relationship with the Director 
of Juvenile Parole Operations and have worked collaboratively on issues to date that 
cross over. An example is the LH Lawsuit that was recently settled and requires joint 
partnerships between Parole, Facilities and Programs in order to be successful. 



121 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 20 of 22 



I fully recognize the importance of reaching out to the parole office staff and intend to 
begin visits to the parole facilities during the second half of my first year. 



Outcomes 

Mr. Warner previously committed the division to implementing Performance-Based 
Standards, a nationally recognized performance management system. He said it has 
105 outcome measures for correctional facilities. This system allows California to 
compare itself to other states. 

20. What is the status of the implementation? What do any preliminary 
results indicate about how California measures up against other states? 

The implementation of Performance-Based Standards (PbS) has begun. 
The preliminary results from the April 2008 data collection cycle demonstrate how 
California compares to other states in the areas of safety, order, security, and health 
care as reported: 



Safety: 



Facilities reported one percent fewer injuries than the national average; 

Injuries to staff: two percent less than the national average; 

Injuries to youths by other youths: 76 percent less than the national average; 

Injuries to youth during the application of physical and/or mechanical 

restraints: 70 percent below the national average; 

Assaults on staff: 73 percent below the national average; 

Staff who reported they fear for their safety: 25 percent below the national 

average; 

Youth who fear for their safety: ten percent below the national average; 

Assaults on youth: five percent higher than the national average. 

The assault category for PbS includes batteries, mutual fights, and group 

disturbances; 

Suicidal behaviors with injuries: 67 percent less than the national average; 

Suicidal behaviors without injuries: 64 percent less than the national average; 

Average daily ratio of direct care staff to youth: nine percent higher than the 

national average. 



Order: 



Use of physical restraints: 75 percent less than the national average; 

The use of isolation, room confinement, and segregation/special management 

unit: 67 percent less than the national average; 

During the October 2007 data collection period, the average number of idle 

waking hours was 44 percent higher than the national average. We now 

122 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 21 of 22 



report virtually the same amount of time: 1.06 hours for the Department 
compared to 1.06 nationally; 

• Use of mechanical restraints: 48 percent more than the national average. 
However, this is a major improvement in that during the October 2007 data 
collection period, mechanical restraint usage was reported as 199 percent 
higher than the national average; 

• Overall, the usage of chemical restraints has increased by 
74 percent over the October 2007 data collection period; 

• Although DJJ uses isolation less than the rest of the nation, when it is used, it 
is used for longer durations. The average length of time spent in isolation, 
room confinement, and segregation/special management unit was reported to 
be 19 percent above the national average. Compared to the prior data 
collection period, this is a major improvement as we were then reporting 
223 percent above the national average. 

• The number of youths who were released from isolation, room confinement, 
and segregation/special management units in less than four hours: 60 percent 
less than the national average; 

• The number of youths who were released from isolation, room 
confinement, and segregation/special management units in less than eight 
hours: 63 percent less than the national average. 

Security: 

• As the number of escapes from any DJJ facility was zero, DJJ was 100 
percent better than the national average; 

• The rate of weapons contraband incidents: 34 percent lower than the national 
average; 

• The rate of drug contraband incidents: 135 percent higher than the national 
average. Again, this is a major improvement from October 2007, when DJJ 
reported a 250 percent higher rate than the national average. 



Health: 



The DJJ has initiated a statewide facility improvement plan to address the 

lack of documentation in regard to health assessments. In most facilities, this 

facility improvement plan is considered closed and documentation is fully in 

place. In the other facilities, the facility improvement plan remains open only 

to monitor that the documentation is being completed as required; 

The percentage of youth who received health assessments within six months 

prior to, or seven days after, admission was reported as four percent higher 

than the national average. During the October 2007 data collection, this was 

reported as 19 percent lower than the national average; 

The percentage of youth who received mental health assessments within 

six months prior to, or seven days after, admission was reported as 



123 



Senate Rules Committee July 17, 2008 

Doug P. McKeever 
Page 22 of 22 



12 percent higher than the national average. During the October 2007 data 
collection, this was reported as six percent lower than the national average; 

• The percentage of youth who received a complete intake screening by 
qualified staff was reported as eight percent less than the national average. 
This is an improvement over the previous collection cycle, at which time DJJ 
reported 18 percent less than the national average; 

• The percentage of youth who received a health intake screening by qualified 
staff within one hour of admission was reported as 40 percent less than the 
national average; 

• The percentage of youth who received an intake screening prior to housing 
assignment was reported as 76 percent less than the national average. 

As can be gleaned from the preliminary data above, the DJJ is making great strides 
in the areas of safety, order, security and health care. As we continue to use the 
PbS Critical Outcome Measures, we will be able to continue the comparison of 
California with the national average, yet more importantly, we can determine what areas 
we need to pay closer attention to. 



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130 



Teresa M. Takai Senat B l r> 

Responses to Questions from the Senate Rules Committee^ w Kales Commit 

July23 ' 2008 JUL 23 m 

Appointments 

1. Please provide us with a brief statement of goals. What do you hope to accomplish 
during your time as the state Chief Information Officer (CIO)? How will you 
measure your success? 

Consistent with California's reputation as the nation's "Silicon" state, my foremost goal 
is to make California state government the leader among the states in using information 
technology to enable the delivery of consistent, innovative, reliable, and secure services 
that satisfy the needs of residents, businesses and public sector agencies. 
Central to this goal is my desire to make government information available and 
accessible to anyone, in anyway, from anyplace, at anytime in a way that is affordable 
to the taxpayers. I am also fully committed to protecting the privacy and security of the 
information that Californians provide to their government. 

Research conducted by the Pew Institute's Government Performance Project has 
shown that states like Michigan, Virginia, Utah, and Washington, which manage 
information from an enterprise (statewide) perspective rather than according to 
departmental silos, are well-managed states. I want to make sure that California 
manages information to drive decision-making and improve the performance of 
government. 

To accomplish these goals, my office will concentrate our work in five areas: 

1 . Leadership - we will organize the state's IT professionals into a community of 
interest with common purpose; produce a statewide strategic plan to set 
direction; establish appropriate relationships with the vendor community; and 
educate decision makers and other interested stakeholders on the key role that 
information technology plays in delivering government services. 

2. Enterprise - we will continue our move toward more consolidation and shared 
services; align IT investments with programmatic business needs by developing 
enterprise architecture (i.e. industry standards implemented statewide) and 
enterprise purchasing; increase resources for enterprise security; improve the 
process for funding IT projects and focus on IT spending control; and establish 
an integrated governance approach that includes portfolio management (i.e. 
coordinated management of state government's IT investments). 

3. Project Management - we will strengthen project management capabilities 
statewide with improved methods, practices and training; establish qualifications 
for and certify state project managers; recruit, retain and refresh the skills 
necessary to develop, implement and maintain next-generation applications; 
promote risk management as a core competency through training and 
certification; and establish an Enterprise Program Management Office. 

131 



July 23, 2008 
Page 2 



4. Policies and Practices - we will refresh the policies and practices that guide IT 
decision making; integrate business and technology strategic planning; 
implement a statewide IT capital planning process that includes projects and 
investments (and necessary documentation) proposed over a five-year period; 
and redesign the IT project approval and oversight process that spans project 
conceptualization, business case analysis, budget review/funding, acquisition, 
implementation and maintenance. 

5. Workforce - we will engage in a comprehensive and inclusive workforce and 
succession planning effort; work cooperatively to modernize hiring process for IT 
workers; expand training and professional development programs; and enhance 
recruiting and retention efforts. 

Given the extent and diversity of these activities, we will employ a variety of 
measurements to gauge our progress. The measures of success will range from simply 
completing the action, reporting on compliance, and surveying involved parties. 

With respect to our focus on transforming the way the state delivers services to 
residents and businesses, our targets are: 

• Increase the number of transactional based self-services by 50 percent by 
December, 2009. 

• Improve the adoption rate of electronic self-service channels by 50 percent by 
December, 2009. 

• Provide 90 percent of government transactions electronically by December, 
2010. 



2. Your office's Web site indicates that the role of the state CIO is to be "a strategic 
planner and architect for the State's information technology programs" and "a 
leader in formulating and advancing a vision for that program. " Please describe the 
concrete steps you will take in both the near and long-term to accomplish these 
objectives. What will your priorities be? 

In addition to driving improvements to the quality of services and the efficiency of state 
IT operations, I will lead the collaborative effort to develop and implement California's 
Statewide IT Strategic Plan that will include actionable strategies to modernize 
California state government through the use of technology. Consistent with SB 90 
(Chapter 183, Statutes of 2007), the IT Strategic Plan will be submitted to the Joint 
Legislative Budget Committee on January 15, 2009. 

We will also integrate business and IT planning and establish the policies necessary to 
connect project initiation to funding approval and to acquisition and application 
development. Within the past few weeks, we have initiated the IT capital planning 
process (see Attachment 1 ) to ensure that IT investments support state and agency 



132 



July 23, 2008 
Page 3 



priorities and programmatic mission. These plans will also be used to align IT 
investments with the state's technology architecture and enable data sharing. 

Nothing is more important to California's IT future than the completion of the Enterprise 
Architecture - the statewide "blueprint" for defining the current and desired technology 
environment. We have completed the first and most important document, the California 
Enterprise Architecture Framework, which lays out an end-to-end process to initiate, 
implement and maintain the State's enterprise architecture program 1 . I am working 
collaboratively with state program and IT leaders to finish this work by completing the 
Business Reference Model, a high-level representation of the business of government. 
As California state government moves to higher levels of system aggregation, we will 
rely on the Business Reference Model to establish the commonalities across lines of 
business in order to reduce redundancy, integrate services and unlock the many 
opportunities to share data. 

In summary, my key priorities are: 

S Developing and implementing the California Statewide IT Strategic Plan. 

S Completing the Business Reference Model and the Enterprise Architecture. 

S Establishing integrated business and IT planning. 

s Consolidating IT infrastructure to enable shared services. 

S Recruiting, retainingand refreshing key IT competencies. 

S Tightening security and privacy safeguards by establishing enterprise policies 

and employee training programs. 
S Ensuring that technology is acquired and utilized in a way that is environmentally 

sustainable and that technology is used to achieve the environmental goals 

articulated by the Governor and the Legislature. 



3. What do you see as the most significant IT challenges facing California? Are these 
challenges similar to those of other large states such as Michigan — where you 
were previously the state CIO — or are the challenges unique to California? 

The most significant IT challenges facing California center on: 

• Strategic planning and integrated IT governance: 

• Establishing enterprise architecture; 

• Consolidating resources and sharing services; 

• Effectively managing IT projects; 

• Recruiting and retaining a skilled workforce; and 

• Enhancing security. 



1 See www.cio.ca.gov/statelT/enterpriseArch.htmi 

133 



July 23, 2008 
Page 4 



These challenges are similar to those I faced in Michigan and those faced by most large 
states. In fact, the National Association of State Chief Information Officers (NASCIO) 
published their top CIO IT Priorities for 2007, which included: 

• Legacy modernization; 

• Security enhancement; 

• Architecture and Web services; and 

• Consolidation of computing and storage. 

While the IT challenges facing all large states are similar, California faces the especially 
daunting challenge of implementing many large IT projects within the context of similarly 
large, complex and diverse government programs. The scope and scale of California 
state government causes even seemingly simple projects to become large, difficult and 
complicated to implement and maintain. Large systems integration projects require 
significant experience, judgment, and management skill in addition to creative thinking, 
structured planning and collaboration. In sum, they challenge the best people and the 
best practices of project management. 

Risk is inherent in all IT projects and the larger and more complex the project, the 
greater the risk. State governments in general, and California state government in 
particular, have reacted to risk by implementing layer upon layer of oversight. While 
oversight is necessary, it is insufficient if it perpetuates a culture that unrealistically 
seeks to eliminate risk. We must accept that risk exists and work to effectively manage 
it by coupling strong project structures with rigorous project management and internal 
vigilance. 

Office of the State Chief Information Officer 

Established in 2007, the Office of the State Chief Information Officer is a cabinet-level 
agency with responsibility for IT strategic planning and policy, project approval, and 
oversight. The state CIO is also responsible for coordinating the activities of agency and 
department ClOs and the director of the Department of Technology Services and 
promoting the efficient and effective use of IT in state operations. 

4. Please describe your efforts to coordinate the activities of agency and department 
ClOs and the director of the Department of Technology Services. What have been 
the challenges? 

When the statutes that established the former Department of Information Technology 
expired, the position of CIO was established by Executive Order. Without appropriated 
resources or staff, my predecessor, Clark Kelso, was charged with providing leadership 
on information technology policy. Over time, a consensus-based governance process 
evolved that drew upon IT leaders from across government in setting overall IT strategy 
and policy. Now that the role of the CIO is defined in statute, I have moved forward by 



134 



July 23, 2008 
Page 5 



establishing a policy and strategy setting process that while center-led, is collaborative, 
inclusive and maintains multiple forums to discuss IT issues. 2 

In an effort to coordinate the activities of agency and department ClOs and the director 
of the Department of Technology Services, I hold monthly meetings to discuss IT policy 
and strategy issues. In addition, I work directly with agency and department ClOs and 
the director of the Department of Technology to address issues related to individual IT 
programs and projects. These efforts have been supplemented by my interactions with 
Agency and department executives on programmatic issues that require IT solutions. 
Beyond direct interactions, I have established the IT Policy Letter (similar to the Budget 
Letter) to formally announce IT policy and have begun the process of normalizing the 
roles, responsibilities and reporting relationships of Agency and department ClOs. 3 

I am pleased to report that the relationships between my office, the governance 
councils, agency and department ClOs, and the director of the Department of 
Technology Services are active, strong and collaborative. 



5. Who should be held accountable for the "state of the state's" IT services? 

While there are several agencies and individuals involved in the delivery of IT services, 
as State CIO I should be held accountable for the "state of the state's" IT services. 



6. In your testimony before the Little Hoover Commission at its hearing regarding data 
and technology on May 22, 2008, you indicated that the Governor and the 
Legislature — by creating the Office of the State CIO — have put the building blocks 
in place for a strong IT program and it is now "our responsibility to build on that 
foundation by using information technology to create a more efficient and 
responsive state government." What concrete steps has your office undertaken, or 
does it plan to undertake, to make state government more responsive and 
efficient? 

I believe that we must have an enterprise (statewide) focus in order to make state 
government more efficient and responsive through the use of information technology. 



2 The major governance bodies which I have continued to support include: 

•The Information Technology Council (IT Council) advises the State CIO on overall IT planning and policy, 

primarily from a technology perspective (includes topic specific subcommittees); 

•The Technology Services Board (TSB) governs the Department of Technology Services and sets policy 

on enterprise services provided by the Department of Technology Services; and, 

•The Enterprise Leadership Council (ELC) provides a forum for Executive Branch agencies to discuss 

and resolve programmatic business issues related to enterprise-wide IT. 

3 Agency ClOs are responsible for overseeing the management of assets, projects, data systems, and IT 
services in the departments of their Agency. Department ClOs are directly responsible for all IT activities 
within their department and accountable to the State CIO through the Agency CIO for purposes of 
reporting departmental IT performance. 

135 



July 23, 2008 
Page 6 



Specifically, my office has focused on the need to transform the state's existing voice 
and data networks to support new Web-based applications, support future consolidation 
initiatives (e.g. data center, local area network, desktop, voice and applications) which 
provide a significant opportunity to reduce state operating costs and energy usage while 
enhancing security and Continuity of Government (e.g., disaster recovery). Enterprise 
network infrastructure modernization is also necessary to achieve data sharing (data 
interoperability) and shared business services. In July 2008, my office in partnership 
with the Department of Technology Services established a roadmap modernizing the 
existing California State Government Network (CSGNet) within two years and achieving 
a single statewide voice and data network within five years. 

From an enterprise perspective, my office will also complete the development of the 
Statewide Enterprise Architecture, integrate business and IT planning, and develop a 
durable project governance structure. Specific actions taken by my office to date 
include: 

• Establishing the process and practices for developing Enterprise Architecture at 
the state- and Agency-level by June 2009. 

• Directing state agencies to complete integrated five-year IT capital plans for 
submittal to my office and the Department of Finance by October 2008; these 
plans will rollup into the Statewide Five-Year IT Capital Plan which will be 
submitted to the Legislature in January 2009. My office also provided the 
documentation and training necessary for agencies to fulfill this requirement. 

• Defining the required structure for project governance (completed May 2008) 
leading the development of a rigorous and scalable IT project management 
methodology and training program which will be in place by October 2008. 

To further support the enterprise programmatic requirements, I formed a Geospatial 
Information Systems (GIS) Task Force made up of state, federal and local government 
representatives to develop a statewide strategy to leverage the technology for 
environmental protection, natural resource management, traffic flow, emergency 
preparedness and response, land use planning and health and human services. The 
GIS Task Force, which I chair, will produce strategies for sharing geography-based data 
and displaying that data on standard maps of California by September 2008. Our 
intention is to streamline the deployment of GIS applications to give policymakers and 
the public access to better decision-making tools. 

My office is focused on utilizing the state's information resources to make government 
more responsive. Since the inception of the Office of Information Technology in 1983, 
the Legislature has understood that interoperable data and information systems will 
enhance services, inform decision making and reduce the cost of government 
operations. While several state agencies, including the Board of Equalization, 
Employment Development Department, the Franchise Tax Board, and the Department 
of Motor Vehicles have made progress on data sharing, data warehousing and business 
intelligence, technology only now enables data sharing on an enterprise-wide basis. 



136 



July 23, 2008 
Page 7 



Recognizing the significant opportunities that exist to leverage existing data, my office 
will establish a comprehensive data strategy, including enterprise standards for data 
sharing, by June 2009. 

Data warehousing and advanced business analytics/business intelligence are critical to 
allow the state to get the most value from shared data. To this end, my office will 
establish a common standard for database management systems in FY 2008-2009 and 
move toward the consolidation of all legacy data warehouses in FY 201 1-2012. As a 
complement to data sharing, data integration represents the processes and methods 
through which data is transformed into information to support business processes. This 
includes the internal framework for service oriented architecture, data interfaces with 
trading partners, and the standards needed to maximize the reuse of software and data. 
My office is developing an enterprise level data integration framework and strategy that 
will be completed by July 2009. 

Lastly, we will establish data governance procedures to include data security, 
standardized data models, rules and best practices for regulatory and statutory 
compliance, privacy, and data preservation. My office has established a data 
governance working group in partnership, with the Director of the Office of Information 
Security and Privacy Protection that will produce a network and data security plan and 
standards in 2009. 

IT Procurement Reforms 

In 2005 the Legislature passed and the Governor signed SB 954 (Figueroa), 
Chapter 556, Statutes of 2005, which represents an opportunity for the state, through 
the Department of General Services (DGS), to reform its IT procurement policies, save 
money, improve accountability, and provide better quality services to Califomians. The 
state CIO is responsible for approving, suspending, terminating, and reinstating IT 
projects. 



7. What is your assessment of whether these reforms are working? 

While the "solutions-based" procurement methodology has tremendous potential to 
save money, improve accountability and provide better quality services to Califomians, 
it is still too early to assess whether these reforms are working. This is still a relatively 
new process and the first procurements using this process are still underway. 



8. What is your role in ensuring that the reforms outlined in SB 954 are properly and 
widely implemented? Are you working with DGS to implement the reforms and, if 
so, how? 

Given my responsibilities for IT project approval, I am involved in ensuring that the 
reforms outlined in SB 954 are properly and widely implemented. Specifically, my office 
reviews Feasibility Study Reports to establish the basis for project approval and then 

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Page 8 



works directly with DGS and the initiating department to prepare and develop the 
necessary procurement documents for approved projects. During the procurement 
process, my office is actively engaged with DGS and the initiating department on critical 
issues. Post-procurement, my office reviews Special Project Reports to ensure that the 
winning IT solution is consistent with department's business case and enterprise 
architecture, and that the IT solution provides a reasonable return on investment. 



9. What is the timetable for ensuring that all major IT procurements reflect the reforms 
contained in SB 954? 

Consistent with SB 954 and the resulting Management Memorandum (MM 07-02), the 
"solutions-based" procurement model is now the default model for all major IT 
procurements (> $5 million) conducted by the Department of General Services. 



10. Beyond SB 954's reforms, what other strategies will you implement to entice more 
IT bidders? What are their timetables for implementation? What obstacles do you 
see that would prevent them from being accomplished? 

Beyond SB 954's reforms, I continue to work with DGS to implement several strategies 
to increase competition for IT projects. The most significant of these efforts include: 

• Maintaining vendor accountability while reducing unnecessary risk to systems 
integrators by limiting their responsibility to warranting the overall IT solution 
rather than the underlying third-party commercial hardware and software used as 
part of the solution. This practice has been implemented. 

• Establishing a model to appropriately manage the financial risks associated with 
IT procurements as required by AB 617 (Torrico), Chapter 736, Statutes of 2007. 
This model will be completed and implemented in 2008. 

• Allowing for more frequent negotiation of contract terms and conditions as 
allowed by Public Contract Code Section 661 1 . This practice will be 
implemented in FY 2008-09. 

• Breaking large IT projects into several small contracts, either according to 
function or phase, to allow smaller IT vendors to more effectively compete for 
state contracts. This practice will be implemented in FY 2008-09. 

• Defining an open, standards-based, enterprise architecture to reduce the 
complexity, and thus the risks to both vendors and the state, associated with 
implementing IT projects. The enterprise architecture will be defined by June 
2009. 

Those who have benefited from the current IT procurement process may raise 
complaints about the proposed changes and attempt to prevent their successful 
implementation. I will continue to work with DGS to proactively reach out to the IT 
vendor community regarding policy and procurement issues and I am confident that 
these efforts will mitigate efforts to derail these needed procurement reforms. 



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Recruitment, Retention, and Succession Planning 

The demographics of the state workforce are such that state agencies need to actively 
engage in workforce and succession planning to recruit and train workers to fill both 
entry level and management positions. Data from the State Personnel Board indicates 
that 44 percent of the state's current workforce is over the age of 45. With 35 percent of 
the state's workforce eligible to retire in the next five years, the state could face a loss of 
over 80,000 personnel in a short period of time. 

In the IT world, the loss of personnel has added implications when employees who have 
expertise regarding older, sometimes antiquated, IT systems and applications leave and 
there are few possible replacements who have similar skills. 

1 1. What do you see as the major challenges affecting the state's ability to maintain a 
skilled IT workforce? How should we address them? 

Maintaining a skilled IT workforce is significantly challenged by the fact that according to 
the Department of Personnel Administration (DPA), state agencies are already 
experiencing IT staff vacancy rates ranging from ten to 1 5 percent and 57 percent of the 
state's current IT personnel will have retired or be eligible to retire in the next 10 years. 
And, given the age of the technology that supports vital services for the state, in many 
cases, it is not possible to find personnel with the IT skills necessary to operate the 
legacy technologies used in state government today. 

At the same time, there is a need to continually train state IT personnel due to the 
changing technology environment and their changing role in state government. While 
technical skills are essential for a large portion of state IT personnel, a growing number 
of IT personnel must move from a purely technical capability to understanding and 
communicating how technology can change the way the state does business. These 
employees must be innovative and creative in utilizing scarce resources to improve the 
way residents and businesses interact with state government, they must possess strong 
project management and leadership skills to handle the size and scope of California's IT 
projects and they must be able to effectively communicate with members of the 
Legislature and legislative staff, agency and departments executives, and other 
constituents. 

The current situation is exacerbated by the lack of clear information on where the skill 
shortages (e.g., specific technical knowledge) will occur throughout the state, when 
these shortages will reach crisis levels, and how much funding will be necessary to 
ensure adequate skills transfer occurs to continue operating the state's legacy systems. 

Addressing these challenges begins with good data about the state's existing IT 
workforce and a clear understanding of our future needs. As part of the IT capital 
planning process, Agencies and departments will lay out their proposed IT investments 
over the five years as well as their workforce and succession plans and information 
about their workforce development efforts. My office will compile this information and 

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July 23, 2008 
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provide a projection of future workforce needs as part of the Statewide IT Capital Plan in 
January 2009. Following the release of this information, I will convene a taskforce 
focused on workforce and succession planning and workforce development made up of 
representatives from DPA, the State Personnel Board (SPB), employee unions, and 
other stakeholders to develop a statewide plan to address these issues. 

In addition to the human capital planning effort I will lead, my office will continue to work 
with state agencies develop strategies to replace legacy technology and train existing 
state IT personnel to operate and support these systems during the migration period. 

12. Please describe any specific plans to recruit and train the highly trained IT 
personnel necessary to fill these positions when existing staff retire. 

In addition to the comprehensive IT human capital planning effort I will lead, my office 
will continue to be actively engaged in the IT Human Resources Classification and 
Selection Project. This effort will result in a modern and flexible State IT classification 
plan, replacing the State's legacy selection systems, and establish skills-based 
certification authority for IT classes. 

My office will also take significant steps to recruit and train IT staff, including: 

• Working with SPB to allow for open examinations for all IT classifications; 

• Seeking pay differentials to aid in the recruitment and retention of key personnel; 

• Expanding partnerships with colleges and universities to recruit IT staff and 
establish a multi-agency IT recruiting team; 

• Enhancing and expanding existing IT project management and systems 
development training programs; and 

• Providing practice, system, and technology oriented educational forums and 
professional development events. 



13. What efforts would you recommend to develop more in-house expertise? How do 
you propose to balance the use of public employees versus private contractors? 

As previously discussed, I plan to engage in a comprehensive employee development 
and recruitment effort to develop the state IT staff necessary to effectively manage the 
development, implementation and maintenance of the state's IT systems. Balancing the 
use of public employees versus private contractors requires a multifaceted approach 
that involves: 

• Educating state executive about their responsibilities under Government Code 
Section 19130, subsections a and b; 

• Streamlining and simplifying the hiring process while maintaining the values of 
the Civil Service system; 

• Continually upgrading the skill sets of state IT personnel; and 

• Working with the Department of Personnel Administration to provide the 
compensation and other non-monetary benefits necessary to recruit and retain 
critical skill sets. 

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Information Security and Privacy 

In 2008 the Office of Information Security and Privacy Protection was established within 
the State and Consumer Services Agency to combine "consumer privacy protection with 
the oversight of government's responsible management of information." 

14. In September 2007 your predecessor issued a "security message" stating, in part, 
"Information security and privacy needs to be ubiquitous in our thinking, planning 
and day-to-day handling of information. " Do you agree with this statement? If so, 
what steps do you recommend to ensure that information security and privacy is 
part of the state's everyday thinking? 

I share Clark Kelso's commitment to information security and privacy protection 
because virtually every aspect of governing and administering state programs requires 
an awareness of the security and privacy on the information entrusted to government by 
Califomians. As such, state government has a unique responsibility to protect the 
information assets of our residents. While technology can provide a degree of 
protection through appropriately implemented and managed security processes, 
devices and applications, a large proportion of data security incidents are the result of 
poor practices and unauthorized activity by state employees. In my experience, 
education and training are the most efficient and effective means of helping employees 
realize their responsibilities for handling information appropriately. 

Technology is just one leg of the three legged stool of information security, with the 
other two legs being procedures and people. Unless state employees understand that 
they have the most important role in protecting personal and other confidential 
information, no technical solution available today can prevent its loss. Existing state 
policy requires privacy training, at least annually, for all employees and contractors who 
handle personal or other confidential information (see SAM sec. 5325 and Management 
Memo 06-12). The Office of Information Security & Privacy Protection (OISPP) already 
provides basic privacy training materials for state employees and they are currently 
working to develop a Web-based training platform that will include specialized modules 
in addition to the basic training. I will partner with the Office of Information Security and 
Privacy Protection to develop the contents of the training modules intended for IT staff 
who play a critical role in protecting state information assets. 

In addition to annual training, an ongoing privacy and security awareness program is 
critical to building a culture of respect for information security and privacy in state 
government; the Office of Information Security and Privacy Protection provides 
awareness materials to departments to use for such efforts. Protecting privacy is 
everyone's job and it requires eternal vigilance. 



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July 23, 2008 
Page 12 



15. How do you see your role as state CIO interacting with the newly created Office of 
Information Security and Privacy Protection ? How do you intend to work with this 
office? 

Information security and privacy are tightly integrated into the state information 
technology framework so it is critical that my office work very closely with the Office of 
Information Security and Privacy Protection. In fact, I meet regularly with the Director of 
the Office of Information Security and Privacy Protection and our offices are co-located 
to capitalize on the synergies I have seen result from close coordination in the past. 

As my office moves forward with the development of a robust Enterprise Architecture, it 
is critical that we address privacy and security issues from the beginning of the IT 
project lifecycle for new projects. Integrating security into the project development 
phase is more effective and efficient than adding security controls to systems after they 
have been implemented. I expect to continue to work closely with the Office of 
Information Security and Privacy Protection to ensure that we make intelligent decisions 
about providing appropriate controls in all new technology projects. 

16. The Department of Consumer Affairs recently notified over 5,000 employees and 
board members that personal information about them had been released. Will you 
play a role in attempting to prevent this type of data breach or follow up to prevent 
recurrence? 

I am acutely aware of the importance of information security and privacy and also of the 
costs, both in dollars and in loss of credibility in the public's eyes that result from a 
security breach of this type. While not all breaches involve information technology, I 
believe that our IT systems and applications must be designed and configured with 
information security in mind, that our policies and practices must be robust and tested 
and that we must provide effective and regular training to our employees for 
government to maintain the trust of the public we serve. I will continue to be an 
advocate for best practices in information security and privacy and will ensure that the 
state's IT policies serve to bolster the practices. 



142 



ATTACHMENT 1 



IT Capital Planning Process 



California needs an overarching business-driven IT strategy that ensures the statewide strategic 
use of technology, rather than independent initiatives that dissipate the state's financial and 
technical capacity. To forge the necessary integration of the business and IT functions in 
California state government, beginning in Fiscal Year 2008-09 state agencies will be required to 
prepare and submit a Five Year IT Capital Plan to the Office of the Chief Information Officer 
(OCIO) and the Department of Finance. On June 30, 2008, the OCIO released Management 
Memo 08-07, which establishes the five-year IT capital planning process. 

The Management Memo (MM) 08-07 announces: (1) The process for preparing and submitting 
Information Technology (IT) Capital Plans; and (2) The associated updates to the State 
Administrative Manual (SAM) and Statewide Information Management Manual (SIMM). MM 08- 
07 is available at: http://www.documents.dqs.ca.gov/osp/sam/mmemos/MM08 07.pdf 

The IT Capital Plan is a component of the OCIO's May 15, 2008 Supplemental Report to the 
Legislature (Item 0502-001-9730 1) that outlined the role of the agency and provided a plan for 
strengthening statewide information technology to create a more responsive state government. 
The IT Capital Plan has been added to the SIMM as Section 57, and is available at: 

ht tp://www.cio.ca.gov/Government/IT Policy/SIMM .htm I 

The Supplemental report is also available at: 

http://www.cio.ca.gov/Publications/2008LeqislativeReports.htm 

The Office of the Chief Information Officer (OCIO) reminds Agencies and Departments that 
completed Agency and Department IT Capital Plans must be submitted electronically to the OCIO 
and the Department of Finance by October 1, 2008. For further information, Agencies and 
Departments should contact their assigned OCIO manager. A list of OCIO staff assignments is 
available at: 

h ttp://www.cio.ca.gov/staffAssignments.html 

Tr aining Materials 



143 



Roles and Responsibilities 

The California State Teachers' Retirement System (CalSTRS) is the largest teachers' 
retirement system in the United States, with approximately 813,000 members and 
beneficiaries and assets of $171 billion. It covers teachers in public K-12 schools and 
community colleges. The primary responsibilities of CalSTRS include maintaining a 
fiscally sound plan for funding approved benefits, providing authorized benefits to 
members and beneficiaries in a timely manner, and furnishing pertinent information to 
teachers, school districts, and other interested groups. The board has overall 
management responsibility for CalSTRS and the authority to review applications for 
CalSTRS benefits. 

1 . What have been your most significant accomplishments during your first term on 
the State Teachers' Retirement Board? What do you hope to accomplish during 
your current tenure? How will you measure your success? Please be specific. 

California school districts are struggling with health care funding challenges and are 
subject to GASB disclosure requirements regarding district indebtedness for retiree 
health insurance. The CalSTRS Board asked staff to help school districts meet their 
disclosure requirements. 

The teacher health care issue goes far beyond disclosure and, I contend, puts 
California educator retirement in jeopardy. I believe I've made a significant contribution 
by raising board and public awareness of the health insurance challenges retirees are 
facing. 

When I met with retired teachers through out the state I encounter teachers in a panic 
over the costs of health care. While a few large districts such as LAUSD, Oakland, and 
San Francisco provide life-long health care for retired teachers, it appeared most 
districts from small or rural districts did not. 

As the only teacher on the CalSTRS Board from a small rural district that provides no 
insurance, I advocated also using our task force for a new look at the retiree health 
insurance situation. Our board voted to form a task force to examine the challenges our 
retired teacher face as they try to access, and pay for, health insurance. They are 
considerable and getting worse. 

As chair of a new committee (the Appeals Committee), chair of the Legislative 
Committee, and vice-chair of the board, many more accomplishments are works in 
progress but currently incomplete. First and foremost, I hope, with your help and 
support, that we will be able to collaboratively tackle a plan to resolve the CalSTRS 
unfunded actuarial obligation. 



- 

r H /4AY 2 ? 2008 

144 



2. What do you believe is the most important responsibility of a board member? 

The responsibility of each board member is to be a diligent fiduciary and always put the 
financial welfare of our members, and their retirement security first. 

3. Since you are appointed to a "public member" seat, what do you believe your 
responsibilities are to the public in general? 

While my seat on the CalSTRS Board represents retired CalSTRS members, this 
position is, as are all board positions, as fiduciary to all of the 800,000 members of the 
CalSTRS system, both active and retired. It is my responsibility to always keep the 
entire membership in mind whenever I vote or speak for the board. 

4. What training and assistance do you receive from staff or others to assist you in 
deliberating often complex CalSTRS' issues? 

At the suggestion of CEO Jack I attended the fiduciary college training at Stanford 
University shortly after I was first appointed to the board. It was at that training that I 
first fully understood the importance of the position I hold, including the personal and 
professional, liability I've accepted in behalf of California's educators. 

CalSTRS staff presents a wide range of outstanding opportunities for growth so board 
members are well informed and continually expanding our knowledge base. I participate 
as often as I possible. At the suggestion of the board fiduciary counsel we also receive 
The Economist, Pensions and Investments, The Deal, numerous online articles, and 
access to various conferences that specialize in timely issues relevant to our decision- 
making. 

The staff work that goes into our meeting agendas and board education meetings is 
extensive. Outside experts are frequently brought in as needed. The education 
opportunities presented to us by staff are of the highest quality, as is the work they do in 
our behalf. I feel however that I am still on the lower half of a learning curve that is 
close to vertical, and will remain there for years if I am fortunate to receive your 
confirmation. 



CalSTRS and the State Budget 

The state is facing a budget crisis, with a projected multibillion dollar deficit. The 
Governor has put forward a budget proposal that will distribute this deficit equally to all 
areas of the budget, including education. As you know, the Governor has also put 
forward a budget proposal for CalSTRS that affects the Supplemental Benefit 
Maintenance Account (SBMA). The proposal would simultaneously (a) reduce the 
state's contribution to SBMA, (b) vest this benefit at 80 percent of purchasing power for 
CalSTRS' members, and (c) allow the board to increase future state contributions if 
more funding were needed to meet the obligation to retirees. At the same time, the 



145 



board has put forward a proposal that is similar to the Governor's proposal, but vests 
the purchasing-power benefit at a higher level (82.5 percent) than the Governor's 
proposal. 

5. When making a decision as a board member, how do you balance your fiduciary 
responsibility to CalSTRS' beneficiaries with the budgetary needs of the state, 
especially given the important role that the state plays in funding both the state's 
public K-12 system and the CalSTRS pension system? 

As a fiduciary my first responsibility is the financial security of the retirement system for 
California educators. It is my charge to do everything possible to be sure that when 
educators reach retirement they have a protected defined benefit retirement income. It 
is the obligation of CalSTRS board members to responsibly administer the portfolio and 
its benefits on behalf of California's educators. The challenge is to provide a safe core 
benefit that will endure for our membership. 

California owes much to its retired educators. Yet, California educators as a whole 
have education requirements, far above and retirement benefits far below, most other 
state employees - in particular those in public safety. It is my hope, as a member of the 
system, that our state will put retirement security for teachers, who have given so much 
for so long, a little higher on the ladder. 



6. In its analysis of the 2008-09 Budget Bill, the Legislative Analyst's Office raises 
various concerns about the Governor's proposal regarding SBMA, one of which 
is the risk that the state's contribution rate to SBMA would have to increase in 
future years. What is your opinion regarding the Vesting portion of the 
Governor's proposal and the benefits it gives to retirees versus the long-term 
liability it leaves for the state? 

The board collectively determined that vesting the SBMA simple benefit was important 
to protect retired members from inflation in light of educator benefits far below other 
public retirees in California. I believe that the State of California owes much of its 
success to its presently retired educators, some of whom live in abject poverty. 

The majority of retired CalSTRS members (62%) have no district help with the expense 
of health insurance, health care costs, or long-term care. In addition, the 2% annual 
cola for CalSTRS is fee simple, lacking even the positive advantage of compounding to 
help with ever-escalating demands on limited funds. The final blow is a Social Security 
off-set for California teachers. If California examines its long-term liabilities, surely 
fractions of a percentage point from its already meager contribution to teachers should 
be at the bottom of its priorities for cuts. 



146 



Unfunded Liability 

The most recent CalSTRS actuarial valuation found the system's unfunded liability to be 
approximately $19.6 billion, leaving the system 87 percent funded. The size of the 
unfunded liability decreased relative to the previous year's valuation. While this 
unfunded liability is comparable to that of big pension systems in other states, it is still 
substantial. 

7. Based on the information you have, what do you believe is the best option for 
addressing the unfunded liability? How did you reach your conclusion? 

Based on the three years I have been on the CalSTRS board, the best alternative for 
closing the unfunded liability is to give the CalSTRS Board the authority to raise 
contributions on employers and members incrementally. This should be done with clear 
advanced warning, by a small amount each year, to close the gap. When the obligation 
is fully funded then negotiations should begin to decide if a reduction in contributions, or 
an enhancement of benefits, is best for the teachers. 

My conclusion is based on the sum of all the board presentations and conferences I 
attended, articles read, and expert information provided over the tenure of my board 
membership. The longer this decision drags on, the larger the size of the increments 
that will become necessary to bring the fund back to health. 

8. When considering options to address the unfunded liability, how do you balance 
the following considerations: the current volatility in the financial markets, the 
state's fiscal situation, and your obligation to CalSTRS' members? 

I'm a fiduciary to the educators of this state. My obligation is first and foremost to our 
members. We expect volatility in the markets and allow for it in our planning. We 
invest for the long term, and build short term volatility into our projections. Our 
investment professionals are as good as it gets. 



Retiree Health Benefits 

Currently, individual school districts make decisions about whether to fund the health 
benefits of their retired teachers. According to the Legislative Analyst's Office, 60 
percent of school districts report providing some amount of health benefits to retirees, 
with some of these districts reporting substantial unfunded liabilities. As you know, the 
CalSTRS' board recently considered a proposal to redirect a portion of future state 
contributions that otherwise would be credited to SBMA to fund a health care benefit to 
retired members. 

9. The Governor's Post-Employment Benefits Commission recommended that local 
governments in California (including school districts) pre-fund all retiree health 
benefits. What are your views of this recommendation given the difficult budget 



147 



situation? How might school districts go about implementing such a 
recommendation ? 

Ideally, the recommendation makes sense. Pre-funding will be a challenge to most 
districts in the state, particularly those with declining enrollment, due to the fiscal 
challenges they already face. My concern is for teachers who are currently retired and 
have no way to pay for the ever-increasing demands of health care. 

10. The board recently proposed redirecting a portion of future state contributions to 
SBMA and instead using these for health care benefits for retired members. How 
does this proposal fit into the overall retiree health issue? 

In actuality, the board has not voted to redirect a portion the SBMA to a health care 
benefit. I believe the health insurance task force is reporting at our June meeting. 

CalSTRS studies on the adequacy of its benefits have identified the importance that 
employer paid retiree health plays in allowing retirees to maintain their standard of 
living. If 62 percent of current retirees do not have any district provided health care in 
retirement, then our projections of an adequate retirement are based on a fallacious 
premise. Even more ominous for future staffing projections, those who have retiree 
health care are from large districts. Districts under 500 teachers generally lack any 
district-provided retiree health insurance. The implications for future California teacher 
recruitment are troubling. 



Corporate Governance and Investment Performance 

In recent years, large public employee pension funds have positioned themselves to 
exert influence on the corporations in which they invest. 

1 1. What are your views on the board's corporate governance policy and its 
relationship to the board's Fiduciary responsibility to its members? 

Good corporate governance results in a stronger, healthier company. As a rule 
stronger companies that are accountable to stockholders earn better returns. I see no 
disconnect that would cause me, as a fiduciary, any concern. CalSTRS exemplary 
leadership in this area, along with CalPERS, is recognized worldwide. This should be a 
source of pride for the Legislature and the Governor. 

When the stock man\et experiences a major decline, the value of many investments is 
reduced. Although public pension fund portfolios are indexed and diversified, at times 
major declines in the stock market have resulted in significant losses for public pension 
funds. 



148 



12. What long-range and preventive measures should public pension funds, such as 
CalSTRS, implement to reduce or mitigate the risk of catastrophic losses in the 
stock market? 

The only way to mitigate risk in our portfolio is to be well diversified and plan for the 
long term. We do both. Additionally our long term time horizon of our diversified 
portfolio allows for, no expects, down periods. Our investment staff can't hit 22 percent 
every year, but what a thrill when it does! 



Actuarial Analyses 

The board has the ability to ask for actuarial analyses of CalSTRS' assets and various 
proposals that would affect its liabilities. To perform its analyses, the actuary must 
make certain assumptions about future economic factors. For example, in evaluation 
the latest proposal to reduce the state's contribution for SB MA, the actuary assumed 
that inflation would average 3.25 percent annually over the next 30 years. 

13. What responsibility do you believe you have as a board member to assess 
whether the actuary's assumptions represent both the worst- and best-case 
scenarios? How do you intent to carry out this responsibility? 

We continue to ask for a best and worst-case scenario of both our staff and board 
actuarial counsel. We also solicit outside actuarial advice on a regular basis. With a 
portfolio as large as ours we continually hold ourselves to the "prudent man" test. On 
certain issues, such as this one, I need to rely on the experts. The 3.25 percent 
assumption once again however illustrates the inadequacy of the teachers 2.0 percent 
non-compounded, non-vested annual cola. 

14. The Governor's Post-Employment Benefits Commission recommended that the 
state create a California actuarial advisory panel to advise retirement systems. 
What is your opinion of this recommendation? 

We already have independent actuarial advice to the board, but I have no problem with 
this recommendation as long as the expense for this panel does not come from teacher 
funds. I would imagine that this new panel would be a benefit to smaller entities with 
fewer resources. 



149 

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