HomeMy WebLinkAboutMINUTES - 07101990 - 2.1 TO: BOARD OF SUPERVISORS 'S. L.° ea
1 Contra
FROM: COSta
Phil Batchelor, County Administrator x,
4o County
DATE: July 5, 1990
SUBJECT: LEGISLATION: THE ALCOHOL TAX ACT OF 1990 - Initiative
Statute & Constitutional Amendment
SPECIFIC REQUESTS)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
RECOMMENDATION:
Support the Alcohol Tax Act of 1990 , as opposed to ACA 38, since
both measures have now qualified for the ballot in November,
1990.
BACKGROUND:
The Board of Supervisors has consistently opposed each version of
ACA 38 as it was working its way through the Legislature. When ,
the initial vote was taken on the Assembly Floor to concur in the
amendments made in the Senate, the Board wrote to each member of
the Assembly who either voted "no" or did not vote, and urged
them not to change their vote. Many of them did, however, and
ACA 38 is now on the ballot in November. Since it appears that
the Initiative has qualified for the ballot as well, the Board
has asked that we place a recommendation on the agenda to support
the Initiative in preference to ACA 38.
The Alcohol Tax Act of 1990 would do all of the following:
1. Defines a unit of beer to be 12 ounces, a unit of wine to be
5 ounces, a unit of fortified wine to be 3 ounces and a unit
of distilled spirits to be 1 ounce.
2. Imposes a surtax on the excise tax on alcoholic beverages at
a rate of five cents per unit as defined above.
CONTINUED ON ATTACHMENT:YeS YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
APPROVE OTHER
SIGNATURE(S): (Z,&Z '41
ACTION OF BOARD ON July 1 0., 1990 APPROVED AS RECOMMENDED _Y OTHER
SupervisorsFanden abstained because of a Conflict of Interest
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN
AYES. Z �� ZZ Y NOES: �j AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: s+ OF SUPERVISORS ON THE DATE SHOWN.
CC: ATTESTED 1T/ ?V
Please see Page 4. PHIL TCHEL CLERK OF THE BOARD OF
SUPERVISORS AND COUNTY ADMINISTRATOR
�•
M382 (10/88) BY DEPUTY
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3 . Exempts the proceeds of the alcoholic beverage surtax from
the "Gann Limit" .
4. Allocates the proceeds of the surtax as follows:
* 24% to the Prevention, Treatment and Recovery Account,
which is then further allocated as follows:
4% to counties for prevention of alcohol and other
drug problems (70% alcohol/30% drug ratio) .
13% to counties for treatment and recovery
services for alcohol and other drug problems ( 70%
alcohol/30% drug ratio) .
- 20 to the State Department of Health Services for
a coordinated statewide and local training, public
policy and public awareness program to prevent
alcohol and other drug problems.
5% to counties for capital expenditures for
housing, treatment and recovery facilities,
domestic violence shelters, and homeless and
low-income facilities for persons recovering from
alcohol and other drug-related problems.
* 25 to the Emergency and Trauma Care Account, which is
then further to be allocated as follows:
17% to counties for emergency medical and trauma
care treatment and all related services.
8% to counties for emergency medical and trauma
care services provided by physicians in general
acute care hospitals that provide basic or
comprehensive emergency services up to the time
the patient is stabilized.
* 15% to the Mental Health Account, to be used for
locally-implemented community mental health programs.
The use of these funds is subject to the provisions of
the Short-Doyle Act and are to be expended for the
following purposes:
50% for seriously mentally-ill adults.
30% for emotionally-disturbed children and
adolescents.
- 20% for mentally-ill older adults.
* 15% to the Infants, Children and Innocent Victims
Account, which is then further to be allocated as
follows:
6% to- counties for prevention, treatment and care
of the health needs of infants, children and women
due to perinatal alcohol and other drug use.
- 4% to counties for prevention, treatment and care
of children who are the victims of child abuse.
3% to counties for shelter, support services and
prevention programs whose primary purpose is to
serve battered women and their children.
2% to the State Department of Rehabilitation for
training, education, public policy, research and
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related support services for persons with
disabilities.
*
21% to the Law Enforcement Account, which is then
further to be allocated as follows:
2% to counties and cities for enforcement of laws
prohibiting driving under the influence of an
alcoholic beverage or any other drug, or the
combined influence of an alcoholic beverage and
any other drug, and related criminal justice and
penal system costs and services.
14% to counties and cities for enforcement of
alcohol and other drug-related laws, and related
criminal justice and penal system costs and
services.
2% to cities, counties and special districts for
recreation and park programs and projects that
address alcohol and other drug impacts on public
parks and facilities, including public safety,
litter, vandalism, youth-at-risk, and other
prevention and diversion activities.
- 2 to the CHP for operation and administration of
a statewide emergency medical air transportation
network.
to to the CHP for enforcement, education and
training relative to laws prohibiting driving
under the influence of an alcoholic beverage or
any other drug, or the combined influence of an
alcoholic beverage and any other drug.
5. Requires a maintenance of effort whereby state funding must
remain at the 1989-90 level and per-capita level. This is
probably the most controversial element of the measure and
is, no doubt, the one generating the controversial radio
advertising. This section reads in full as follows:
"Funds expended pursuant to this chapter shall be
used only for the purposes specified in this
chapter and shall supplement 1989-90 state funding
and per capita levels of service and not replace
existing state funding nor fund future state
increases in the cost of providing existing
per-capita levels of service. Existing state
funding and per capita levels of service for
purposes specified in this chapter shall not be
reduced."
6. Provides additional specific restrictions on the use of the
funds and definitions which are to govern the use of the
funds.
7. The entire chapter becomes effective January 1, 1991,
presumably meaning that that is when the surtax on alcoholic
beverages becomes effective.
8. Provides that the chapter can be amended by the Legislature
only by a 4/5 vote and then only for purposes which are
consistent with the intent of the chapter.
9. Includes a separability clause in case one provision of the
measure is determined to be invalid or unconstitutional that
all other provisions will remain in effect.
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It has been estimated that the surtax would generate between $700
and $800 million annually in additional revenue to be allocated
at outlined above.
cc: Members, Board of Supervisors
Members, Legislative Delegation
All County Department Heads
Alcohol Program Administrator
Drug Program Administrator
Kathy Fairbanks, Alcohol Tax Initiative
2500 Wilshire Blvd. , Suite 515
Los Angeles, CA 90057
FILED LEG COUN
THE ALCOHOL TAX ACT OF 1990
SECTION 1. This measure shall be known and may be cited
as the Alcohol Tax Act of 1990 .
SECTION 2 . The people find and declare as follows :
(a) Alcohol problems cost Californians about $13 . 6
billion annually in increased health care costs , higher crime
rates , lost worker productivity, environmental damage, and
injuries from alcohol-related accidents and abuse .
(b) The staggering cost of alcohol abuse is borne by
all Californians , but 67 percent of the alcohol is consumed
by only 11 percent of the population.
(c) An increase in the excise tax levied on alcoholic
beverages that is equivalent to a nickel-a-drink is a fair
way to reduce the alcohol burden on all California taxpayers .
(d) Alcohol-related accidents are the leading cause of
death among teenagers and the cause of many injuries
resulting in permanent disabilities .
(e) There is a strong correlation between alcohol and
other drug use.
( f) Meeting the demand for alcohol and other drug
treatment and recovery programs is an increasingly expensive
burden to all California taxpayers .
(g) Alcohol and other drug use is a major cause of
hospital emergency room and trauma care treatment, and
contributes to the need for emergency medical
air-transportation services .
(h) Alcohol and other drug use is closely associated
with mental illness and contributes enormously to the cost of
treating the mentally ill. I
(i) Alcohol and other drug use contributes
significantly to vandalism, litter, and unruly and criminal
behavior in California' s parks and recreation facilities .
(j ) Alcohol and other drug use is a major factor in the
majority of child abuse and battered woman cases , and is also
frequently associated with abuse of elderly, mentally-ill and
mentally-retarded residents of long-term care facilities .
(k) Alcohol use during pregnancy causes approximately
5 , 000 children to be born in California each year with
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alcohol-related birth defects ; and other drug use during
pregnancy, especially cocaine, causes thousands of
drug-affected babies to be born each year.
(1) Drinking and driving, and driving under the
influence of other drugs, is the major cause of traffic
accidents and fatalities in California each year.
(m) Alcohol and other drug-related crimes are an
increasing burden to law enforcement and the criminal justice
system in California.
SECTION 3. Section 7 is added to Article XIII A of the
Constitution, to read:
SECTION 7 . The Alcohol Tax Act of 1990 is exempted from
the provisions of Section 3 .
SECTION 4 . Section 13 is added to Article XIII B of the
Constitution, to read:
SECTION 13 . "Appropriations subject to limitation" of
each entity of government shall not include appropriations of
revenue from the Alcohol Surtax Fund created by the Alcohol
Tax Act of 1990 . No adjustment in the appropriations limit
of any entity of government shall be required pursuant to
Section 3 as a result of revenue being deposited in or
appropriated from the Alcohol Surtax Fund created by the
Alcohol Tax Act of 1990.
SECTION 5. Chapter 5 .5 (commencing with Section 32220 )
is added to Part 14 of Division 2 of the Revenue and Taxation
Code, to read:
Chapter 5.5 . Surtax on Beer, Wine and Distilled
Spirits .
Article 1. Definitions .
Section 32220. For purposes of this chapter:
(a) "Fund" means the Alcohol Surtax Fund created by
Section 32221.
(b) "Unit, " for purposes of Article 3 , means the
appropriate measure of any of the following:
( 1) Twelve ounces of beer.
( 2 ) Five ounces of all wine, except those in
subdivision ( 3 ) .
( 3 ) Three ounces of fortified wine.
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( 4 ) One ounce of distilled spirits .
(c) "Fortified Wine" means any wine which ( i) contains
alcohol in an amount equal to or more than fourteen percent
by volume when bottled or packaged by the manufacturer, ( ii)
is not both sealed and capped by cork closure, and aged two
or more years , (iii) does not contain fourteen or more
percent of alcohol by volume solely as a result of the
natural fermentation process , and (iv) has been produced with
the addition of wine spirits, brandy or alcohol .
Article 2 . Creation of Fund.
Section 32221. The Alcohol Surtax Fund is hereby
created in the State Treasury-. The fund shall consist of all
revenues raised pursuant to the taxes imposed by Article
Article 3 , and all interest and penalties imposed thereon
pursuant to this part. Earnings derived from investment of
monies in the fund shall accrue to the fund. Monies in the
fund shall be continuously appropriated without regard to
fiscal year.
Section 32222 . The fund consists of five separate
accounts , as follows :
(a) The Prevention, Treatment and Recovery Account,
funds from which shall only be expended for the following:
( 1) Prevention of alcohol and other drug problems .
(2) Treatment and recovery services for alcohol and
other drug problems .
(3) A coordinated statewide and local training, public
policy and public awareness program to prevent alcohol and
other drug problems , and to inform the public, particularly
children and teenagers, of the potential health risks of
alcohol and other drug use.
(4) Capital expenditures (including accessibility
improvements for the disabled) for housing, treatment and
recovery facilities, domestic violence shelters ,, and homeless
and low-income facilities for persons recovering from
alcohol- and other drug-related problems .
(b) The Emergency and Trauma Care Account, funds from
which shall only be expended for the following:
( 1) Emergency medical and trauma care treatment and all
related services .
(2) Emergency medical and trauma care services provided
by physicians in general acute care hospitals that provide
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basic or comprehensive emergency services up to the time the
patient is stabilized.
(c) The Mental Health Account, funds from which shall
only be expended for locally-implemented community mental
health programs .
(d) The Infants , Children and Innocent Victims Account,
funds from which shall only be expended for the following:
( 1) Prevention, treatment and care of the health needs
of infants , children and women due to perinatal alcohol and
other drug use .
(2) Prevention, treatment and care of children who are
the victims of child abuse.
(3 ) Shelter, support services and prevention programs
whose primary purpose is to serve battered women and their
children.
(4) Training, education, public policy, research and
related support services for persons with disabilities .
(e) The Law Enforcement Account, funds from which shall
only be expended for the following:
( 1) Enforcement of laws prohibiting driving under the
influence of an alcoholic beverage or any other drug, or the
combined influence of an alcoholic beverage and any other
drug, and related criminal justice and penal system costs and
services .
(2) Enforcement of alcohol- and other drug-related
laws , and related criminal justice and penal system costs and
services .
( 3) Recreation and park programs and projects that
address alcohol and other drug impacts on public parks and
facilities , including public safety, litter, vandalism,
youth-at-risk, and other prevention and diversion activities .
(4) Operation and administration of a 'statewide
emergency medical air-transportation network.
(5) Enforcement, education and training relative to
laws prohibiting driving under the influence of an alcoholic
beverage or any other drug, or the combined influence of an
alcoholic beverage and any other drug.
Article 3 . Imposition of the Surtax on Beer, wine and
Distilled Spirits .
Section 32225. A surtax at the rate of five cents
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( .0 . 05 ) per unit, as defined in Section 32220 ( b) , and at a
proportionate rate for any other quantity, is iriposed upon
every unit of beer and wine sold in this state or sold
pursuant to Section 23384 of the Business and Professions
Code, by a manufacturer, wine grower, or importer, or sellers
of beer or wine selling beer or wine with respect to which no
tax has been paid within areas over which the United States
Goveriunent exercises jurisdiction.
Section 32226 . A surtax at the rate of five cents
( $0 . 05 ) per unit, as defined in Section 32220 (b) , and at a
proportionate rate for any other quantity, is imposed upon
every unit of distilled spirits sold in this state or sold
pursuant to Section 23384 of the Business and Professions
Code, by manufacturers , distilled spirits manufacturer ' s
agents , brandy manufacturers , rectifiers , and wholesalers , or
sellers of distilled spirits selling distilled spirits with
respect to which no tax has been paid within areas over which
the United States Government exercises jurisdiction.
Section 32227 . Except with respect to beer and wine in
the internal revenue bonded premises of a beer manufacturer
or wine grower, and except with respect to those distilled
spirits in possession or control of distilled spirits
taxpayers as defined by Section 23010 of the Business and
Professions Code, upon which the taxes imposed by Section
32226 have not been paid, a floor stock tax of five cents
( $0 . 05 ) shall be imposed on every unit of beer, wine and
distilled spirits in the possession or under the control of
every person licensed under Division 9 (commencing with
Section 23000 ) of the Business and Professions Code on or
after 2 : 01 a .m. on January 1 , 1991 , pursuant to rules and
regulations promulgated by the State Board of Equalization.
This floor stock tax shall be due and payable on February 15,
1991 .
Section 32228 . The taxes imposed by this article are
imposed in addition to any other tax imposed upon beer, wine
and distilled spirits by this part, and in addition to any
other tax imposed upon beer, wine or distilled spirits by the
voters at the November 6 , 1990 election.
Section 32229 . All the provisions of this part, with
the exception of those contained in Chapter 10 , relating to
excise taxes , are applicable also to the taxes imposed by
this Article, to the extent that they are riot inconsistent
with this Article.
Article 4 . Disposition of the Surtax Proceeds
Section 32230 . . (a) With the exception of payments of
refunds made pursuant to Chapter 8 of this part, and, as
determined by the Department of Finance, reimbursement of the
State Board of Equalization for expenses incurred in the
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administration, enforcement and collection of the taxes
imposed by Article 3 , pursuant to its powers vested by this
part, and reimbursement of the State Controller for expenses
incurred in the administration of the fund, all monies in the
fund shall be allocated as provided in subdivision (b) .
(b) Monies in the fund shall be allocated according to
the following formula:
(1) Twenty-four percent shall be deposited in the
Prevention, Treatment and Recovery Account, which is to be
further allocated for the purposes specified in Section
32222(a) as follows : four percent for subdivision ( 1 ) ,
thirteen percent for subdivision ( 2 ) , two percent for
subdivision ( 3 ) and five percent for subdivision (4) .
(2) Twenty-five percent shall be deposited in the
Emergency and Trauma Care Account, which is to be further
allocated for the purposes specified in Section 32222 (b) as
follows: seventeen percent for subdivision ( 1) and eight
percent for subdivision ( 2) .
(3) Fifteen percent shall be deposited in the Mental
Health Account, which is to be allocated for purposes
specified in Section 32222 (c) .
(4) Fifteen percent shall be deposited in the Infants ,
Children and Innocent Victims Account, which is to be further
allocated for the purposes specified in Section 32222 (d) as
follows: six percent for subdivision ( 1) , four percent for
subdivision (2 ) , three percent for subdivision ( 3) and two
percent for subdivision (4) .
(5) Twenty-one percent shall be deposited in the Law
Enforcement Account, which is to be further allocated for the
purposes specified in Section 32222 (e) as follows : two
percent for subdivision ( 1) , fourteen percent for subdivision
( 2) , two percent for subdivision ( 3 ) , two percent for
subdivision (4 ) and one percent subdivision (5) .
(c) Any amount allocated from any account specified in
subdivision (b) which is not expended within one year shall
revert to the account from which it .was appropriated.
(d) The percentages stated in subdivision (b) are
stated as a percentage of the monies deposited in the fund
and not as a percentage of the monies. deposited in each
account.
Section 32231. (a) Monies deposited in the fund shall
be allocated by the State Controller for expenditure on
purposes specified in Section 32222 as follows:
( 1) For all the purposes specified in subdivisions
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( a) ( 1 ) , ( 2 ) and ( 4 ) ; (b) ; and (d) ( 1 ) , ( 2 ) and ( 3 ) ;
collectively, to counties pursuant to the following formula:
( 1) one hundred and fifty thousand dollars ( $150 , 000 ) to each
county annually and ( 2 ) the remaining funds apportioned based
on each county ' s proportionate share of population.
(2 ) For purposes specified in subdivision (a) ( 3 ) , to
the Department of Health Services .
(3) For purposes specified in subdivision (d) ( 4 ) , to
the Department of Rehabilitation.
(4 ) For purposes specified in subdivisions ( e) ( 1) and
(2) , fifty percent to counties based on each county ' s
proportionate share of population and fifty percent to cities
based on each city' s proportionate share of the population.
(5) For purposes specified in subdivision (e) ( 3 ) , to
cities , counties and special districts pursuant- to the
distribution formula specified in Section 5720 of the Public
Resources Code, except there shall not be the minimum
allocations referred to in subdivisions (b) and (c ) ( 1) .
( 6) For purposes specified in subdivisions (e) ( 4 ) and
(5) , to the California Highway Patrol.
(b) Monies allocated pursuant to subdivision (a) shall
be disbursed as follows : subsection ( 1) , monthly;, subsections
(2) , ( 3) , ( 4 ) and (6 ) , quarterly; and subsection ( 5 ) , annuall
on the first day of each fiscal year.
(c) Monies allocated in subdivision (a) based on
population shall be allocated based on the most recent
Department of Finance population estimates .
Section 32232. Funds expended pursuant to this chapter
shall be used only for the purposes specified in this chapter
and shall supplement 1989-90 state funding and per capita
levels of service and not replace existing state funding nor
fund future state increases in the cost of providing existing
per-capita levels of service. Existing state funding and per
capita levels of service for purposes specified in this
chapter shall not be reduced.
Section 32233. (a) Funds allocated for the purposes
specified in Sections 32222 (a) ( 1) , (2) and (4) shall be
expended pursuant to each county' s final approval of separate
alcohol and other drug program plans prepared in accordance
with the provisions of Sections 11810.5 and 11810 . 6 (a) ( 1)
through ( 4 ) , Article 4 , Chapter 4, Part 2 and Section
11983 .2 (a) ( 1) through ( 4 ) , Chapter 3 , Part 3 of Division 10 . 5
of the Health and Safety Code, and such other provisions as
determined by each county. Each county ' s final approved
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plans shall be submitted to the Department of Alcohol and
Drug Programs for information purposes only.
(b) Funds allocated for the purposes specified in
Sections 32222 ( a) ( 1 ) and ( 2 ) shall be expended for alcohol
and other drug purposes on a 70 percent alcohol/30 percent
drug ratio .
(c) Funds allocated for the purposes specified in
Sections 32222 (a) ( 2 ) , (b) , (c) and (d) shall only be
available for payment of services to persons who cannot
afford to pay for the services , and for whom payment for the
services will not be made through private coverage or by any
program funded in whole or in part by the federal government .
(d) Of the funds allocated for the purposes specified
in Section 32222 (a ) ( 3 ) , at least fifty percent shall be
expended for a mass media program that ( 1) informs the public
of the potential health risks of alcohol and other drug use
and/or ( 2 ) counteracts alcoholic beverage marketing messages .
(e) Funds allocated for the purposes specified in
Section 32222 (b) ( 1 ) shall be expended by counties for the
provision of emergency ( as defined by Section 1797 . 70 of the
Health and Safety Code) and trauma (as defined by Section
100240 , Article 1, Chapter 7, Title 22 of the California
Administrative Code) care and all related services pursuant
to Sections 17000 , 17001 and 17003 of the Welfare and
Institutions Code .
( f) Funds allocated for the purposes specified in
Section 32222 (b) ( 2 ) shall be disbursed by counties to
physicans , as defined in Section 1797 . 98a of the Health and
Safety Code, for emergency and trauma care services rendered,
and shall be in addition to those provided by Articles 3 and
3 . 5 , Chapter 5 , Part 4 . 7 , Division 9 of the Welfare and .
Institutions Code and the Emergency Medical Services Fund
(Chapter 2 . 5 , Division 2 .5 of the Health and Saftey Code) .
Funds shall be disbursed at least quarterly on an equitable
basis .
(g) Funds allocated for the purposes specified in
Section 32222 (c ) shall be expended pursuant to the
Short-Doyle Act (Part 2 , Division 5 of the Welfare and
Institutions Code) and mental health programs contained in
Chapters 5 , 6 and 6 . 8 of Part 1 and Part 3 of Division 5 of
the Welfare and Institutions Code, as- follows: 50% for
seriously mentally-ill adults, 30% for emotionally-disturbed
children and adolescents, and 20% for mentally-ill older
adults . The Department of Mental Health shall annually
prepare recommendations to the Legislature on the expenditure
of these funds upon review of local Short-Doyle plans or
negotiated net amount contracts , as defined in Section 5705 . 2
of the Welfare and Institutions Code. These funds shall be
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used exclusively to reform and improve the support and
treatment systems for the seriously mentally ill in all
counties .
(h) Funds allocated for the purposes specified in
Section 32222 (d) ( 1) shall be expended by counties pursuant to
the authority specified in subdivisions (d) and ( i) of
Section 1276 , Article 2 , Subchapter 1, Chapter 3 , Title 17 of
the California Administrative Code .
(i) Funds allocated for the purposes specified in
Section 32222 (d) ( 2 ) shall be expended by counties for
programs described in Article 5 (Children ' s Trust Fund) ,
Chapter 11, Part 6, Division 9 of the Welfare and
Institutions Code.
( j ) Funds allocated for the purposes specified in
Section 32222 (d) ( 3 ) shall be expended by counties for
programs described in The Domestic Violence Centers Act
(Chapter 5 , Part 6 , Division 9 of the Welfare and
Institutions Code) .
(k) Funds allocated for the purposes specified in
Section 32222 (d) ( 4) shall be expended by independent living
centers as defined in Section 19801 of the Welfare and
Institutions Code .
(1) Funds allocated for the purposes specified in
Section 32222 (e) ( 2 ) may be expended by counties and cities
for Long Term Care Ombudsman services , as defined in Article
3 , Chapter 9 , Division 8 .5 , Part 1 of the Welfare and
Institutions Code, in long term care facilities , as defined
in subdivision (a) of Section 9701 Welfare and Institutions
Code.
(m) Funds allocated for the purposes specified in
Section 32222 (e) ( 4 ) shall be expended for an emergency
medical air-transportation system crewed by personnel of the
California Highway Patrol as defined in subdivision (a) of
Section 830 .2 of the Penal Code.
Article S. General Provisions
Section 32240 . This chapter shall take effect on
January 1, 1991 .
Section 32241. This chapter may be amended only by the
four-fifths vote of the membership of- both houses of the
Legislature. All amendments to this chapter must be
consistent with its purposes .
SECTION 6 . If any section of this measure, or part
thereof, is for any reason held to be invalid or
unconstitutional, the remaining sections shall not be
affected, but shall remain in full force and effect .
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