Chapter 2 – Fiscal Management

In order to identify capital improvement needs and plan for the funding and accomplishment of this activity, the California Department of Corrections and Rehabilitation (CDCRCalifornia Department of Corrections and Rehabilitation) annually prepares a five-year plan for these improvements along with a project plan for the budget year (i.e., year one of the five-year plan).

This Article outlines the CDCRCalifornia Department of Corrections and Rehabilitation’s Office of Facilities Management (OFMOffice of Facilities Management (see FPCM)) procedures and guidelines for development and submission of the five-year capital improvement plan and construction projects for approval.

Projects included in the Budget Act, and any other legislation, are authorized for planning, design, and construction in accordance with the effective date of the authorizing legislation.

The OFMOffice of Facilities Management (see FPCM) shall maintain the CDCRCalifornia Department of Corrections and Rehabilitation’s five-year plan for major construction projects and direct the planning, design, and construction of all projects authorized by the legislature. Penal Code (PCPenal Code) Section 7000 authorizes the CDCRCalifornia Department of Corrections and Rehabilitation to prepare plans for and construct facilities and renovations included within its Five-Year Infrastructure Plan. The CDCRCalifornia Department of Corrections and Rehabilitation may transfer the responsibility for undertaking any aspect of the plan to the Department of General Services (DGSDepartment of General Services).

The OFMOffice of Facilities Management (see FPCM) may delegate the completion of funded projects subject to the Department Operations Manual, Section 21040.4, to a CDCRCalifornia Department of Corrections and Rehabilitation facility. All projects to be undertaken by a facility require approval from DGSDepartment of General Services using a Standard (STDStandard Form (DGS)) Form 23, Request for Project Undertaking by State Agency, applicable to undertake projects from $120,000 to $400,000 excluding those projects authorized for completion by the Inmate Day Labor (IDLIndustrial Disability Leave) program or those the CDCRCalifornia Department of Corrections and Rehabilitation undertakes under the authority of PCPenal Code 7000.

Note: The cost limitation is adjusted upward or downward by the Director of the Department of Finance (DOFDepartment Of Finance) every two years to reflect the percentage change in the California Construction Cost Index (CCCI) as used by DGSDepartment of General Services. For purposes of compliance with this Section, the current cost limitation can be obtained by contacting the Capital Outlay Section of OFMOffice of Facilities Management (see FPCM).

The following definitions are included as a guide, but any definitions in statute shall supersede the definitions in this Article.

• Major Capital Outlay

  • Major capital outlay projects include the following:

    • Any real property acquisition including the exercise of a lease purchase option.

    • New construction, extension, or betterment in excess of $400,000.

    • Fixed and movable equipment necessary for the initial occupancy of a new facility.

• Minor Capital Outlay

  • Capital outlay construction projects estimated to cost $400,000 or less.

• Special Repairs

  • Repair projects that, irrespective of cost, continue the usability of a facility at its designed level of services are termed special repairs. The nature of these repair projects is considered extraordinary, either in amount or occurrence, and extends the life of the facility or infrastructure.

• Alterations

  • Any modification to a State building that changes the use of the building in function, layout, capacity, or quality is an alteration. New construction may be considered an alteration. Typical alterations include the demolition and construction of new walls and additions up to the limits in Section 6.00 of the Budget Act (Section 6).

• Maintenance

  • Maintenance projects are intended to keep structures, grounds, equipment, and facilities within acceptable standards of structural condition, appearance, and utility.

• Budget Package

  • A budget package consists of schematic drawings, outline specifications, and a cost estimate. Packages shall be descriptive to convey accurately the location, scope, cost, and nature of the improvement being proposed.

• Preliminary Plan

  • The preliminary plan includes site plan, architectural floor plans, elevations, outline specifications, and cost estimate. For each utility, site development, conversion, and remodeling project, the drawings shall be descriptive to convey accurately the location, scope, cost, and nature of the improvement being proposed.

• Working Drawing

  • Working drawings include a complete set of plans, specifications, and final cost estimate that show/describe all phases of a project (architectural, structural, mechanical, electrical, civil engineering, and landscaping systems) to the degree necessary for accurate bidding by contractors and for the use of artisans in constructing the project. All necessary professional fees and administrative service costs shall be included in the final cost estimate.

• Construction

  • Construction projects are those that create new or improved real property. A capital outlay project shall include all related items such as fixtures, installed equipment (commonly referred to as Group I equipment), auxiliary facilities, contingencies, project construction management, administration, and associated costs like design and loss of productivity. Group II equipment, movable equipment, such as tables and chairs, will be included as necessary and appropriate.

Alteration projects shall normally be budgeted in the capital outlay budget category as part of the building construction program. Funds from the State operations’ budget category may only be used for alterations if they meet the criteria established under Section 6.00. Pursuant to Section 6.00, no support funds may be used for any project for alteration of a State building requiring total expenditures of $100,000 or more unless the Director of DOFDepartment Of Finance determines that the proposed alteration is critical and it is necessary to proceed using funds appropriated for support purposes. The maximum cost of any project undertaken under Section 6.00 authorization shall not exceed $400,000.

Any construction project estimated to be less than $1,000, and includes all of the following, may be undertaken by the facility:

• The alterations do not increase program costs and/or personnel year requirements.

• The alterations do not create life, safety, or environmental problems.

As part of the State’s construction program, the CDCRCalifornia Department of Corrections and Rehabilitation shall maintain a five-year plan for major construction projects. The plan shall be prepared in accordance with Government Code (GCGovernment Code) Section 13100 and in compliance with directives from DOFDepartment Of Finance, including the following:

• The CDCRCalifornia Department of Corrections and Rehabilitation’s projected capital outlay needs for five years beyond the period covered by the latest Governor’s Budget.

• Capital Outlay Budget Change Proposal’s (COBCP) for each project which CDCRCalifornia Department of Corrections and Rehabilitation wishes to include in the next budget year.

• A listing in priority order of CDC’Rs proposed capital outlay program for the upcoming fiscal year.

Note: The plan is prepared annually and may be modified at that time.

February 1

• The CDCRCalifornia Department of Corrections and Rehabilitation’s Five-Year Infrastructure Plan shall be submitted to the DOFDepartment Of Finance each February.

The COBCP’s are the formal requests for capital outlay projects submitted for approval in the five-year plan. They should be prepared in sufficient detail to describe the type of improvements requested. A COBCP shall include the following information regarding the project:

• Purpose of the project.

• Relationship to the Strategic Plan.

• A discussion of alternatives.

• The recommended solution and rationale for choosing it.

• A detailed scope description.

• The basis or source of the cost information.

• Description of any impacts to the support budget.

• Identification of any perceived project risks.

• A proposed project schedule that identifies start and completion of the various funding phases (i.e., preliminary plans, study, etc.).

• A detailed cost breakdown.

• A Management Plan (how will the project be accomplished, swing space, etc.).

The following schedule has been established to meet the CDCRCalifornia Department of Corrections and Rehabilitation and DOFDepartment Of Finance time frames. A detailed timetable for the current budget cycle shall be developed annually and provided to the facilities. Facilities shall adhere to this annual timetable so that analysis and processing may occur in an orderly and effective manner within statewide deadlines. Dates on which facilities are required to submit items are the dates for OFMOffice of Facilities Management (see FPCM) action in order to forward the items to the Secretary, CDCRCalifornia Department of Corrections and Rehabilitation, and DOFDepartment Of Finance within the statewide deadlines:

• Year One:

  • March

    • The OFMOffice of Facilities Management (see FPCM) shall issue a “Budget Call Letter” to all facilities requesting the development of budget concept papers for the major and minor capital outlay program and identifying the time frames for the upcoming budget cycle.

  • April

    • Deadline for the receipt of concept papers for all major and minor capital outlay projects.

  • May

    • Capital outlay analysts may conduct on-site reviews of all proposed projects in preparation for project priority setting.

    • A committee that includes representatives of the Division of Adult Institutions, Division of Correctional Health Care Services, Office of Substance Abuse, Joint Venture Program, and OFMOffice of Facilities Management (see FPCM) makes project priority recommendations. These recommendations are the basis for determining which projects should be fully developed into COBCP’s.

    • Based on the approved priorities and subject to the availability of funding, facilities are given approval to develop COBCP’s.

  • July

    • Deadline for submission of COBCP’s to OFMOffice of Facilities Management (see FPCM).

  • September

    • Review and discussion of project analysis, recommendations and COBCP’s deficiencies are conducted with facility staff.

  • October

    • All final COBCP’s are due to OFMOffice of Facilities Management (see FPCM).

  • November

    • The OFMOffice of Facilities Management (see FPCM) recommendations and analysis are submitted to the Office of the Secretary to establish the final priority list for the CDCRCalifornia Department of Corrections and Rehabilitation’s capital outlay program.

  • January – February 1 The existing facilities five-year capital outlay plan is submitted to the CDCRCalifornia Department of Corrections and Rehabilitation for approval and then to DOFDepartment Of Finance.

• Year Two:

  • July – August

    • Final approved list of projects submitted to DOFDepartment Of Finance.

  • September – December

    • State Capital Outlay Program Evaluation meetings and review are conducted with DOFDepartment Of Finance. Capital outlay budget hearings are held with the DOFDepartment Of Finance and the CDCRCalifornia Department of Corrections and Rehabilitation to determine which projects will be included in the Governor’s budget for the upcoming fiscal year.

  • January

    • The Governor’s Budget and Budget Bill are submitted to the Legislature.

  • February

    • The CDCRCalifornia Department of Corrections and Rehabilitation identifies capital outlay projects that were not included in the Governor’s Budget, but have become critical. Justification identifying why the projects are now critical must be included in a Finance Letter submission.

  • March

    • The CDCRCalifornia Department of Corrections and Rehabilitation receives the Legislative Analyst’s Office recommendations of the Governor’s Budget.

  • April – June

    • Legislative hearings on the Budget Bill are held. During this time, the OFMOffice of Facilities Management (see FPCM) continues to work with DOFDepartment Of Finance and the Legislative Analyst’s Office to resolve outstanding issues.

  • July

    • This is the earliest effective date of the Budget Act. Notification of all major and minor capital outlay projects approved in this process is prepared for transmittal to the institutions and other interested programs.

Project design is the process that converts the concepts outlined in COBCP’s into a set of plans and specifications that will allow the project to be constructed. The planning process for major capital outlay projects is divided into two major sections:

• Preliminary plans (or design drawings) include site plans, architectural floor plans, elevations, outline specifications, and cost estimates. This stage in planning is identified in order to review architectural and engineering input to ensure the project still meets facility objectives and is consistent with legislative scope and cost. Preliminary plans shall be reviewed by DOFDepartment Of Finance and approved by the State Public Works Board (SPWB).

• Working drawings (or construction documents) are preliminary plans with full architectural and engineering detail. These plans are developed in sufficient detail to instruct any construction organization how to build the project and identify what materials and equipment must be approved by DOFDepartment Of Finance before any construction can take place.

Major capital outlay construction can be accomplished in three ways. All public works not specifically exempted are administered by the DGSDepartment of General Services. Upon approval of working drawings by the DOFDepartment Of Finance, they may authorize DGSDepartment of General Services to bid the project to private contractors. The lowest responsible bidder may then construct the project. The second method of construction utilizes IDLIndustrial Disability Leave. The IDLIndustrial Disability Leave utilizes a combination of State staff, trade union labor, and inmates to accomplish the capital outlay project. The IDLIndustrial Disability Leave requires the approval of DOFDepartment Of Finance, SPWB, and Prison Industries Board and is subject to the availability of resources. A third method that we now have available is under PCPenal Code 7000 which allows the CDCRCalifornia Department of Corrections and Rehabilitation to use new prison construction resources and processes.

After the project is authorized for design and/or construction, it may be necessary for the CDCRCalifornia Department of Corrections and Rehabilitation, DGSDepartment of General Services, or the contractor to add, delete, or modify components of the project. If that change significantly modifies the size, shape, assigned space, or physical characteristics of the project, written approval shall be obtained from the DOFDepartment Of Finance and the Legislature. Minor capital outlay scope changes only require DOFDepartment Of Finance approval.

The Deputy Director, OFMOffice of Facilities Management (see FPCM) or designee shall be responsible for ensuring that the contents of this Article are kept current and accurate.

PCPenal Code §§ 2816, 2817, and 7000.

GCGovernment Code §§ 13100, and 13332.11.

SAMState Administrative Manual §§ 6600 – 6724.

Section 6.00 of the Budget Act.

Public Contracts Code § 10108.