REPORT/RECOMMENDATION TO THE BOARD OF SUPERVISORS
OF SAN BERNARDINO COUNTY
AND RECORD OF ACTION
April 9, 2024
FROM
JASON ANDERSON, District Attorney
SUBJECT
Title
Amendment to Grant Award Agreement with the California Insurance Commissioner for the Automobile Insurance Fraud Program
End
RECOMMENDATION(S)
Recommendation
1. Approve Amendment No. 1 to Grant Award Agreement No. 23-1195 with the California Insurance Commissioner, for an additional $59,129, increasing the grant award from $777,869 to a total award amount of $836,998, to fund the Automobile Insurance Fraud Program, with no change to the period of July 1, 2023 through June 30, 2024.
2. Adopt Resolution, as required by the California Department of Insurance, approving the Amended Grant Award Agreement and authorizing the Chief Deputy District Attorney to electronically sign and submit the Amendment to the Grand Award Agreement, and any related documents, on behalf of the County, subject to review by County Counsel.
3. Authorize the Auditor-Controller/Treasurer/Tax Collector to post the necessary budget adjustment of $59,129, as detailed in the Financial Impact section, in the District Attorney’s 2023-24 budget (Four votes required).
4. Direct the Chief Deputy District Attorney to transmit Amendment No. 1 to Grant Award Agreement No. 23-1195 to the Clerk of the Board of Supervisors within 30 days of execution.
(Presenter: Michael Fermin, Chief Assistant District Attorney, 382-3662)
Body
COUNTY AND CHIEF EXECUTIVE OFFICER GOALS & OBJECTIVES
Operate in a Fiscally-Responsible and Business-Like Manner.
Provide for the Safety, Health and Social Service Needs of County Residents.
FINANCIAL IMPACT
Approval of this item will not result in the use of additional Discretionary General Funding (Net County Cost). Although the total grant award of $836,998 does not fully fund the annual salary and benefits cost estimated at $950,350 for grant staff (one Deputy District Attorney, two District Attorney Senior Investigators, and one Secretary I), the additional revenue will further offset staffing costs incurred in the District Attorney’s (DA) General Fund.
Funds received from the Department of Insurance (DOI) are placed into the Special Revenue Fund 2670 which is then transferred to the DA’s General Fund for reimbursement of expenses paid for the unit. Due to the timing of the receipt of funds from the DOI, all expenses are paid out of the DA’s General Fund to avoid a negative balance in the Special Revenue Fund. The estimated shortfall of $113,352 is Net County Cost included in the District Attorney’s (Department) 2023-24 budget. A budget adjustment for the additional $59,129 is requested as follows:
|
Fund Center |
Commitment Item |
Description |
Action |
Amount |
|
4500002670 |
40408955 |
State-Grants |
Increase |
$59,129 |
|
4500002670 |
55405010 |
Salaries & Benefits Transfers Out |
Increase |
$59,129 |
|
4500001000 |
55415011 |
Salaries & Benefits Transfers In |
Increase |
$59,129 |
|
4500001000 |
51001010 |
Regular Salaries |
Increase |
$59,129 |
BACKGROUND INFORMATION
The State Insurance Commissioner, as authorized by Section 1872.8 of the California Insurance Code and California Code of Regulations, Title 10, Section 2698.65, annually distributes grant funds to agencies statewide for the purpose of investigating and prosecuting automobile insurance fraud cases. The Department has been receiving funds for this purpose since 1991. In addition to keeping the public safe, the Department’s prosecution of automobile insurance fraud often results in reduced insurance claim payments and a commensurate decrease in automobile insurance premiums for County residents.
On November 14, 2023 (Item No. 34), the Board of Supervisors (Board) approved Grant Award Agreement No. 23-1195 with the California Insurance Commissioner, accepting $777,869 for the Automobile Insurance Fraud Prosecution Program for the period of July 1, 2023 through June 30, 2024. The grant is used to partially fund the following existing positions: one Deputy District Attorney, two Deputy District Senior Investigators, and one Secretary I. The additional grant funding of $59,129 will offset salary and benefit costs of staff assigned to the Automobile Insurance Fraud Prosecution Program.
Grant funding is administered by the California DOI and originates with a fee assessed upon all automobile insurance policies issued in the State of California. Vehicle Code section 16028(a) requires all drivers in California to carry proof of financial responsibility, which is satisfied by providing proof of automobile insurance.
The Department received a mid-cycle increase to its grant award last year and is receiving a mid-cycle increase again this year. This mid-cycle increase to the grant award does not happen every year, but it is not unusual. The California DOI reconciles its initial allocation to awarded counties with the balance of remaining funds. If there are more funds available after the reconciliation, DOI provides additional funds to awarded counties.
This year, DOI has an additional $1,109,000 of which $59,129 is being awarded to San Bernardino County. DOI does not require any program changes or new initiatives to receive the additional funding and has directed that the Department continue the investigation and prosecution of automobile insurance fraud.
The State of California, DOI requires a Resolution from the Board approving the Amended Grant Award Agreement and authorizing the Chief Deputy District Attorney to electronically sign the amendment to the Grant Award Agreement.
PROCUREMENT
N/A
REVIEW BY OTHERS
This item has been reviewed by County Counsel (Richard Luczak, Deputy County Counsel, 387-5455) on March 18, 2024; Auditor-Controller/Treasurer/Tax Collector (Charlene Huang, Auditor-Controller Manager, 382-7022) on March 18, 2024; Finance (Kathleen Gonzalez, Finance Analyst, 387-5412) on March 21, 2024; and County Finance and Administration (Robert Saldana, Deputy Executive Officer, 387-5423) on March 25, 2024.