(a) Pursuant to this chapter, the board of supervisors may
establish by ordinance the Kern County Hospital Authority, which
shall be a public agency that is a local unit of government separate
and apart from the county and any other public entity for all
purposes. The authority established pursuant to this chapter shall
file the statement required by Section 53051 of the Government Code,
and is a public entity for purposes of Division 3.6 (commencing with
Section 810) of Title 1 of the Government Code.
(b) The purpose of the authority shall be to do all of the
following:
(1) Provide management, administration, and other controls
consistent with this chapter as needed to operate the medical center
and maintain its status as a designated public hospital, as defined
in subdivision (d) of Section 14166.1 of the Welfare and Institutions
Code, and for the operation of additional programs, clinics and
other facilities, care organizations, health care service and
physician practice plans, and delivery systems that may be affiliated
or consolidated with the medical center, to ensure the viability of
the health care safety net in the county in a manner consistent with
the county's requirements under Section 17000 of the Welfare and
Institutions Code.
(2) Provide management, administration, and other controls
consistent with this chapter to negotiate and enter into contracts to
provide or arrange, or provide directly, on a fee-for-service,
capitated, or other basis, health care services to individuals
including, but not limited to, those covered under Subchapters XVIII
(commencing with Section 1395), XIX (commencing with Section 1396),
and XXI (commencing with Section 1397aa) of Chapter 7 of Title 42 of
the United States Code, those entitled to coverage under private
group coverage, private individual coverage, including without
limitation, coverage through Covered California, other publicly
supported programs, those employed by public agencies or private
businesses, and uninsured or indigent individuals.
(c) Subject to the requirements of this chapter, the authority
shall have, and be charged with, authority for the maintenance,
operation, management, control, ownership, or lease of the medical
center and other health-related resources, as provided by the
enabling ordinance. The State Department of Health Care Services
shall take all necessary steps to ensure all of the following:
(1) The authority has all of the licenses, permits, and approvals
needed to operate the medical center.
(2) The medical center continues its status as a designated public
hospital to at least the same extent as it would be designated in
the absence of its transfer to the authority pursuant to this
chapter.
(3) The authority may participate as a contributing public agency
for all of the purposes specified in Section 433.51 of Title 42 of
the Code of Federal Regulations, to the extent permitted by federal
law.
(d) The board of supervisors, in the enabling ordinance, shall
establish the terms and conditions of the transfer to the authority
from the county, including, but not limited to, all of the following:
(1) Any transfer of real and personal property, assets, and
liabilities, including, but not limited to, liabilities of the
medical center determined and assigned by the county for county funds
previously advanced, but not repaid or otherwise recovered, to fund
the operations of the medical center.
(2) Transfer of employees, including any necessary personnel
transition plan, as specified in Section 101853.1, allocation of
credit for funded pension assets and responsibility for any unfunded
pension liabilities under the Kern County Employees' Retirement
Association, as specified in paragraph (7) of subdivision (g) of
Section 101853.1, or other retirement plans, and funding of the
accrued benefits of employees of the authority in the event of
withdrawal from the plan or dissolution of the authority. Any
allocation of credit for funded pension assets and responsibility for
any unfunded pension liabilities with respect to the Kern County
Employees' Retirement Association must be approved by its governing
board of retirement after consideration of legal and actuarial
analysis, and no such allocation may be made that would jeopardize
the qualified status of the Kern County Employees' Retirement
Association under the federal Internal Revenue Code.
(3) Maintenance, operation, management, control, ownership, or
lease of the medical center.
(4) Transfer of licenses.
(5) Whether funds of the authority shall be deposited in the
custody of, and paid out solely through, the county treasurer's
office.
(6) Any other matters as the board of supervisors deems necessary,
appropriate, or convenient for the conduct of the authority's
activities.
(e) (1) Notwithstanding any other law, a transfer of control of
the medical center to the authority may be made, with or without the
payment of a purchase price by the authority, and otherwise upon the
terms and conditions as found necessary by the board of supervisors
and specified in the enabling ordinance to ensure that the transfer
will constitute an ongoing material benefit to the county and its
residents.
(2) A transfer of control of the medical center to the authority
shall not be construed as empowering the authority to transfer any
ownership interest of the county in any portion of the medical center
except as otherwise approved by the board of supervisors.
(3) The authority shall not transfer the maintenance, operation,
management, control, ownership, or lease of the medical center to any
other person or entity without the prior written approval of the
board of supervisors. This paragraph shall not prevent the county, by
ordinance, from allowing the disposal of obsolete or surplus
equipment, supplies, or furnishings of the medical center by the
authority.
(4) With respect to its maintenance, operation, management,
control, ownership, or lease of the medical center, the authority
shall conform to both of the following requirements:
(A) Comply with any applicable requirements of Section 14000.2 of
the Welfare and Institutions Code.
(B) Comply with any applicable requirements of Section 1442.5.
(5) The board of supervisors may retain control of the medical
center physical plant and facilities, as specifically provided for in
the enabling ordinance or other lawful agreements entered into by
the board of supervisors. Any lease agreement between the county and
the authority shall provide that county premises shall not be sublet
without the approval of the board of supervisors.
(6) Notwithstanding any other provision of this chapter, and
whether or not accompanied by a change in licensing, the authority's
responsibility for the maintenance, operation, management, or control
of the medical center, or any ownership or leasehold interest of the
authority in the medical center, does not relieve the county of the
ultimate responsibility for indigent care pursuant to Section 17000
of the Welfare and Institutions Code.
(7) For purposes of Article 12 (commencing with Section 17612.1)
of Chapter 6 of Part 5 of Division 9 of the Welfare and Institutions
Code, and the definition set forth in subdivision (f) of Section
17612.2 of the Welfare and Institutions Code, the medical center,
excluding components that provide predominately public health
services, and the county are affiliated governmental entities.
(f) The board of supervisors may contract with the authority for
the provision of indigent care services on behalf of the county. The
contract shall specify that county policies, as may be modified from
time to time and consistent with the county's obligations under
Section 17000 of the Welfare and Institutions Code, shall be
applicable. Notwithstanding any other provision of this chapter, the
authority shall not undertake any of the county's obligations under
Section 17000 of the Welfare and Institutions Code, nor shall the
authority have an entitlement to receive any revenue for the
discharge of the county's obligations, without a written agreement
with the county. Any contract executed by and between the county and
the authority shall provide for the indemnification of the county by
the authority for liabilities as specifically set forth in the
contract, except that the contract shall include a provision that the
county shall remain liable for its own negligent acts.
Indemnification by the authority shall not divest the county from its
ultimate responsibility for compliance with Section 17000 of the
Welfare and Institutions Code.
(g) Unless otherwise agreed to by the authority and the board of
supervisors or as otherwise provided by this chapter, an obligation
of the authority, statutory, contractual, or otherwise, shall be the
obligation solely of the authority and shall not be the obligation of
the county or any other entity, and any contract executed by and
between the county and the authority, or any other entity and the
authority, shall contain a provision that liabilities or obligations
of the authority with respect to its activities pursuant to the
contract shall be the liabilities or obligations of the authority and
shall not be or become the liabilities or obligations of the county
or the other entity, respectively. An obligation of the authority,
statutory, contractual, or otherwise, shall not be the obligation of
the state.
(h) The authority shall not be a "person" subject to suit under
the Cartwright Act (Chapter 2 (commencing with Section 16700) of Part
2 of Division 7 of the Business and Professions Code).
(i) The authority is not subject to the jurisdiction of a local
agency formation commission pursuant to the Cortese-Knox-Hertzberg
Local Government Reorganization Act of 2000 (Division 3 (commencing
with Section 56000) of Title 5 of the Government Code), or any
successor statute.
(j) The authority is a "district" within the meaning set forth in
the County Employees Retirement Law of 1937 (Chapter 3 (commencing
with Section 31450) of Part 3 of Division 4 of Title 3 of the
Government Code). Employees of the authority are eligible to become
members or maintain membership, as applicable, in the Kern County
Employees' Retirement Association, to the extent described in
subdivision (g) of Section 101853.1.
(k) Any determination with respect to the manner in which the
authority qualifies as a governmental plan sponsor under Section 414
(d) of the Internal Revenue Code shall be limited to relevant
employee benefits purposes of that code only, and shall not change or
otherwise modify the authority's status as a public agency that is a
local unit of government for other purposes specified in this
chapter.
(a) In exercising its powers to employ personnel, the
authority shall implement, and the board of supervisors shall adopt,
a personnel transition plan. The personnel transition plan shall
require all of the following:
(1) Ongoing communication to employees and recognized employee
organizations regarding the impact of the transition on existing
medical center, county, and other health care facility employees and
employee classifications.
(2) Meeting and conferring with representatives of affected
bargaining unit employees on both of the following issues:
(A) A timeframe for which the transfer of personnel shall occur.
(B) Specified periods of time during which county or medical
center employees affected by the establishment of the authority may
elect to be considered for appointment and exercise reinstatement
rights, if applicable, to funded, equivalent, vacant county positions
for which they are qualified and eligible. An employee who first
elects to remain with the county may subsequently seek reinstatement
with the authority within 30 days of the election to remain with the
county and shall be subject to the requirements of this article.
(3) Acknowledgment that the authority, to the extent permitted by
federal and state law, and consistent with paragraph (3) of
subdivision (d), shall be bound by the terms of those memoranda of
understanding executed between the county and its exclusive employee
representatives that are in effect on the date of the transfer of
control of the medical center to the authority. Subsequent memoranda
of understanding with exclusive employee representatives shall be
subject to approval only by the board of governors.
(4) Communication to the Board of Retirement of the Kern County
Employees' Retirement Association or other retirement plan of any
personnel transition plan, memoranda of understanding, or other
arrangements that are related to the participation of the authority's
employees or the addition of new employees in the retirement plan.
(b) Implementation of this chapter shall not be a cause for the
modification of the medical center or county employment benefits.
Employees of the medical center or county on the date of transfer,
who become authority employees, shall retain their existing or
equivalent classifications and job descriptions upon transfer to the
authority, comparable pension benefits (if permissible pursuant to
relevant plan terms), and their existing salaries and other benefits
that include, but are not limited to, accrued and unused vacation,
sick leave, personal leave, health care, retiree health benefits, and
deferred compensation plans. The transfer of an employee from the
medical center or county shall not constitute a termination of
employment for purposes of Section 227.3 of the Labor Code, or
employee benefit plans and arrangements maintained by the medical
center or county, except as otherwise provided in the enabling
ordinance or personnel transition plan, nor shall it be counted as a
break in uninterrupted employment for purposes of Section 31641 of
the Government Code with respect to the Kern County Employees'
Retirement Association, or state service for purposes of the Public
Employees' Retirement System (Part 3 (commencing with Section 20000)
of Division 5 of Title 2 of the Government Code).
(c) Subject to applicable state law, the authority shall recognize
the exclusive employee representatives of those authority employees
who are transferred from the county or medical center to the
authority pursuant to this chapter.
(d) In order to stabilize labor and employment relations and
provide continuity of care and services to the people of the county,
and notwithstanding any other law, the authority shall do all of the
following for a period of 24 months after the effective date of the
transfer of control of the medical center to the authority:
(1) Continue to recognize each exclusive employee representative
of each bargaining unit.
(2) Continue to provide the same level of employee benefits to
authority employees, whether the obligation to provide those benefits
arise out of a memorandum of understanding, or other agreements or
law.
(3) Extend and continue to be bound by any existing memoranda of
understanding covering the terms and conditions of employment for
employees of the authority, including the level of wages and
benefits, and any county rules, ordinances, or policies specifically
identified and incorporated by reference in a memoranda of
understanding for 24 months or through the term of the memorandum of
understanding, whichever shall be the longer, unless modified by
mutual agreement with each of the exclusive employee representatives.
The authority shall continue to provide those pension benefits
specified in any memoranda of agreement as long as doing so does not
conflict with any Kern County Employee Retirement Association plan
provisions, or federal or state law including the County Employees
Retirement Law of 1937 (Chapter 3 (commencing with Section 31450) of
Part 3 of Division 4 of Title 3 of the Government Code and the
federal Internal Revenue Code). If a memoranda of understanding is
expired on the date of the transfer of control of the medical center,
then the authority shall continue to be bound by the terms and
conditions of the most recent memoranda of understanding, unless
modified by a mutual agreement with each of the exclusive employee
representatives, and the benefits and wages of transferred employees
shall be retained consistent with subdivision (b).
(4) Meet and confer with the exclusive employee representatives to
develop processes and procedures to address employee disciplinary
action taken against permanent employees. If the authority
terminates, suspends, demotes, or reduces the pay of a permanent
employee for disciplinary reasons, those actions shall only be for
cause consistent with state law, and an employee shall be afforded
applicable due process protections granted to public employees under
state law. Permanent employees laid off by the authority within six
months of the date of the transfer of control of the medical center
shall remain on the county reemployment list for two years. Inclusion
on the county reemployment list is not a guarantee of reemployment.
For the purposes of this paragraph, the term "permanent employees"
excludes probationary employees, temporary employees, seasonal
employees, provisional employees, extra help employees, and per diem
employees.
(5) To the extent layoffs occur, and provided that all other
previously agreed upon factors are equal, ensure that seniority shall
prevail. The authority shall meet and confer with the exclusive
employee representatives to address layoff procedures and the manner
in which, and the extent to which, seniority shall be measured for
employees who transfer from the medical center or county.
(e) Permanent employees of the medical center or county on the
effective date of the transfer of control of the medical center to
the authority, shall be deemed qualified for employment in equivalent
positions at the authority, and no other qualifications shall be
required except as otherwise required by state or federal law.
Probationary employees on the effective date of the transfer, as set
forth in this paragraph, shall retain their probationary status and
rights and shall not be required to serve a new probationary period
or extend their probationary period by reason of the transfer. To the
extent possible, employees who transfer to equivalent positions at
the authority shall retain their existing classifications and job
descriptions, but if there is a dispute over this issue, the
authority agrees to meet and confer with the exclusive employee
representatives of the transferred employees.
(f) Employees who transfer from the medical center or county to
the authority shall retain the seniority they earned at the medical
center or county and any benefits or privileges based on the
seniority.
(g) Notwithstanding any other law, employees of the authority may
participate in the Kern County Employees' Retirement Association,
operated pursuant to the County Employees Retirement Law of 1937
(Chapter 3 (commencing with Section 31450) of Part 3 of Division 4 of
Title 3 of the Government Code) as set forth below. However, the
authority and employees of the authority, or certain designated parts
thereof, shall not participate in the Kern County Employees'
Retirement Association if the board of retirement, in its sole
discretion, determines that their participation could jeopardize the
Kern County Employees' Retirement Association's tax-qualified or
governmental plan status under federal law, or if a contract or
related contract amendment proposed by the authority contains any
benefit provisions that are not specifically authorized by Chapters 3
(commencing with Section 31450) and 3.9 (commencing with Section
31899) of Part 3 of Division 4 of Title 3 of the Government Code or
Article 4 (commencing with Section 7522) of Chapter 21 of Division 7
of Title 1 of the Government Code, and that the board determines
would adversely affect the administration of the system. There shall
not be any individual employee elections regarding participation in
the Kern County Employees' Retirement Association or other retirement
plans except to the extent such retirement plans provide for
elective employee salary deferral contributions in accordance with
federal Internal Revenue Code rules.
(1) Employees transferred from the county or medical center to the
authority who are subject to a memorandum of understanding between
the authority and an exclusive employee representative, as described
in paragraphs (2) and (3) of subdivision (d), and who were members of
the Kern County Employees' Retirement Association at the time of
their transfer of employment, shall continue to be a member of the
Kern County Employees' Retirement Association, retaining service
credit earned to the date of transfer, to the extent provided for in
the applicable memorandum of understanding.
(2) Employees transferred from the county or medical center to the
authority who are subject to a memorandum of understanding between
the authority and an exclusive employee representative, as described
in paragraphs (2) and (3) of subdivision (d), and who were not
members of the Kern County Employees' Retirement Association at the
time of their transfer of employment, shall subsequently become a
member of the Kern County Employees' Retirement Association only to
the extent provided for in the applicable memorandum of
understanding.
(3) Employees transferred from the county or medical center to the
authority who are not subject to a memorandum of understanding
between the authority and an exclusive employee representative, as
described in paragraphs (2) and (3) of subdivision (d), and who were
members of the Kern County Employees' Retirement Association at the
time of their transfer of employment, shall continue to be a member
of the Kern County Employees' Retirement Association, retaining
service credit earned to the date of transfer, as provided in the
enabling ordinance or the personnel transition plan.
(4) Employees transferred from the county or medical center to the
authority who are not subject to a memorandum of understanding
between the authority and an exclusive employee representative, as
described in paragraphs (2) and (3) of subdivision (d), and who were
not members of the Kern County Employees' Retirement Association at
the time of their transfer of employment, shall subsequently become a
member of the Kern County Employees' Retirement Association only to
the extent provided in the enabling ordinance or the personnel
transition plan.
(5) Employees hired by the authority on or after the effective
date of the transfer of control of the medical center shall become a
member of the Kern County Employees' Retirement Association only to
the extent provided in the enabling ordinance or personnel transition
plan described in subdivision (a), or, if subject to a memorandum of
understanding between the authority and an exclusive employee
representative as described in paragraphs (2) and (3) of subdivision
(d), to the extent provided for in the applicable memorandum of
understanding.
(6) (A) Notwithstanding any other law, for purposes of California
Public Employees' Pension Reform Act of 2013 (Article 4 (commencing
with Section 7522) of Chapter 21 of Division 7 of Title 1 of the
Government Code), an individual who was employed by the county or the
medical center when it was a constituent department of the county,
and is a member of the Kern County Employees' Retirement Association
or the Public Employees' Retirement System, as set forth in Part 3
(commencing with Section 20000) of Division 5 of Title 2 of the
Government Code or a member prior to January 1, 2013, and who
transfers, directly or after a break in service of less than six
months, to the authority, in which the individual continues to be a
member of either the Kern County Employees' Retirement Association or
the Public Employees' Retirement System, as applicable, shall not be
deemed to be a new employee or a new member within the meaning of
Section 7522.04 of the Government Code, and shall continue to be
subject, immediately after the transfer, to the same defined benefit
formula, as defined in Section 7522.04 of the Government Code, and
plan of replacement benefits offered by the county pursuant to
Section 31899.4 of the Government Code and the Kern County
Replacement Benefits Plan for retirement benefits limited by Section
415 of Title 26 of the United States Code.
(B) For purposes of subdivision (c) of Section 7522.43 of the
Government Code, the authority shall be treated as a public employer
that offered a plan of replacement benefits prior to January 1, 2013.
The county's plan of replacement benefits that was in effect prior
to January 1, 2013, is deemed to also be the authority's replacement
plan for the sole purpose of allowing the authority to continue to
offer the plan of replacement benefits, immediately after the
transfer, for Kern County Employees' Retirement Association members
who meet both of the following requirements, and the qualifying
survivors or beneficiaries of those members:
(i) The employee was employed as of January 1, 2013, by the county
or the medical center when it was a constituent department of the
county.
(ii) The employee is part of a member group to which the county
offered a plan of replacement benefits prior to January 1, 2013.
(7) (i) Notwithstanding any other law, legacy employees shall be
deemed to be county employees for purposes of participation in a
benefit plan administered by the Kern County Employees' Retirement
Association, but only for that purpose, and shall not be employees of
the county for any other purpose. Upon the transfer of control of
the medical center and thereafter, the county shall include legacy
employees in a special county employee group for which the county has
primary financial responsibility to fund all employer contributions
that, together with contributions by employees and earnings thereon,
are necessary to fund all benefits for legacy employees administered
by the Kern County Employees' Retirement Association, notwithstanding
the fact that, following the transfer of control of the medical
center, the authority shall commence making periodic employer
contributions for legacy employees. In the event the authority fails
to make required employer contributions for legacy employees when due
and after demand from the Kern County Employees' Retirement
Association, the county, after receipt of notice and demand from the
Kern County Employees' Retirement Association, shall be obligated to
make those contributions in place of the authority.
(ii) The authority shall be primarily responsible for any employer
contributions that, together with contributions by employees and
earnings thereon, are necessary to fund all benefits for new
employees. In the event the authority fails to make required
contributions for new employees, the county shall be obligated to
make the required contributions after receipt of notice and demand
from the Kern County Employees' Retirement Association. The county
shall maintain this obligation for new employees until the authority
demonstrates, and the Kern County Employees' Retirement Association's
Board of Retirement determines, that the authority is sufficiently
capable financially to fully assume the obligation to make all
employer contributions for new employees, based upon the standard of
financial capability approved by the Kern County Employees'
Retirement Association and the county in a plan of participation, and
incorporated within a written agreement between the county and the
authority. In the event the authority fails to make required
contributions for any new employees due to the authority's
dissolution or bankruptcy, the county shall be obligated to make the
required contributions after receipt of notice and demand from the
Kern County Employees' Retirement Association.
(h) This chapter shall not prohibit the authority from contracting
with the Public Employees' Retirement System, in accordance with the
requirements of Section 20508 and any other applicable provisions of
Part 3 (commencing with Section 20000) of Division 5 of Title 2 of
the Government Code, for the purpose of providing employee
participation in that system, or from establishing an alternative or
supplemental retirement system or arrangement, including, but not
limited to, deferred compensation arrangements, to the extent
permitted by law and subject to any applicable agreement between the
authority and the exclusive employee representatives, and as provided
in the enabling ordinance or the personnel transition plan.
Notwithstanding any other law, the authority and employees of the
authority shall not participate in the Public Employees' Retirement
System if the Board of Administration of the Public Employees'
Retirement System, in its sole discretion, determines that their
participation could jeopardize the Public Employees' Retirement
System's tax-qualified or governmental plan status under federal law,
or if a contract or related contract amendment proposed by the
authority contains any benefit provisions that are not specifically
authorized by Part 3 (commencing with Section 20000) of Division 5 of
Title 2 of the Government Code, and that the board determines would
adversely affect the administration of the system.
(i) Provided that this is not inconsistent with anything in this
chapter, this chapter does not prohibit the authority from
determining the number of employees, the number of full-time
equivalent positions, job descriptions, the nature and extent of
classified employment positions, and salaries of employees.