California Code of Regulations
Title 9 - Rehabilitative and Developmental Services
Division 4 - Department of Alcohol and Drug Programs
Chapter 2.5 - Substance Abuse and Crime Prevention Act of 2000 and Substance Abuse Treatment and Testing Accountability Program
Section 9530 - Allowable Costs and Activities for SATTF Funds

Universal Citation: 9 CA Code of Regs 9530

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

(a) The county and any public or private contractors shall use SATTF funds in accordance with the provisions of the Act and the requirements of this regulation.

(b) SATTF funds shall be used to cover the costs of placing clients in and providing drug treatment services pursuant to the Act provided by drug treatment programs, as defined in Section 9505, and additional services supplemental to treatment, as defined in Section 9505. SATTF funds shall not be used to pay for drug testing. SATTF funds may be used for other services, which may include probation department costs; court monitoring costs; and miscellaneous costs. As used in this regulation "miscellaneous costs" means any costs associated with implementation of the Act.

(1) Miscellaneous costs may include the cost of housing only if:
(A) The client is concurrently receiving drug treatment services as defined in Section 9505;

(B) The facility providing housing is affiliated with a drug treatment program as defined in Section 9505 and has a contract with the county lead agency to provide housing pursuant to the Act; and

(C) The combined cost of housing and drug treatment services provided to the client does not exceed the median cost of residential drug treatment services paid for by the same county pursuant to the Act.

(2) Drug education may be provided as the sole service pursuant to the Act under the following conditions:
(A) The county has determined through an assessment conducted in accordance with its county plan that the client requires only drug education; and

(B) The client is receiving drug education services from a drug treatment program as defined in Section 9505.

(c) Prior to July 1, 2001, SATTF funds shall be used for activities needed to implement the Act. Such activities shall include, but shall not be limited to the following:

(1) Planning and coordinating county activities needed to begin providing drug treatment, literacy training, family counseling, vocational training, and other services in order to implement the Act by July 1, 2001; and

(2) Expanding existing drug treatment programs or developing new drug treatment programs.

(d) Commencing July 1, 2001, SATTF funds may be used until expended for the purposes specified in (c) of this regulation or to provide services as identified in the county plan developed in accordance with Section 9515.

(e) SATTF funds shall not be used for the purchase of land, purchase or construction of buildings, or additions to buildings. The Department shall not grant waivers to this prohibition.

(1) As used in this regulation, "additions to buildings" means structural changes that require the relocation of exterior walls, roofs, or floors, regardless of cost.

(2) Non-State costs of purchase or construction of buildings or additions to buildings may be recovered only through straight line depreciation over the class life of the property, as specified in the "Table of Class Lives and Recovery Periods" in federal IRS Publication 946, "How to Depreciate Property", which is available from any office of the IRS.

(f) With the exception of specific requirements included in (g), (h), and (i) of this regulation, determination of allowable and allocable costs under the Act shall be made utilizing the guidelines contained in the Act and in cost principles published by the federal Office of Management and Budget (OMB). The county shall follow OMB Circular A-87, "Cost Principles for State, Local and Indian Tribal Governments". Public and private contractors shall follow OMB Circular A-122, "Cost Principles for Non-Profit Organizations". Both OMB circulars are available from the Executive Office of the President, Office of Management and Budget, Washington, D.C. 20503.

(g) Purchase of equipment. As used in this regulation, "equipment" means an article of nonexpendable, tangible personal property having a useful life of more than one year and an acquisition cost of $5,000 or more, or the capitalization level established by the county auditor-controller, whichever is less.

(1) Any equipment purchased with SATTF funds shall be used for activities and services allowed in Section 11999.6 of the Health and Safety Code.

(2) Expenditures which are less than $5,000 may be reimbursed as allowable costs in the year incurred.

(3) Expenditures of $5,000 or more may be recovered only through straight line depreciation over the class life of the property, as specified in the "Table of Class Lives and Recovery Periods" in federal Internal Revenue Service (IRS) Publication 946, "How to Depreciate Property", which is available from any office of the IRS.

(4) When replacing equipment, the equipment to be replaced shall be used as a trade-in, or the equipment shall be sold and the proceeds shall be used to offset the cost of the replacement property.

(5) Public or private contractors shall obtain written approval from the county prior to purchasing equipment.

(h) Alteration and/or renovation

(1) As used in this regulation, "alteration and/or renovation" means work required to change installed equipment or the interior arrangements or other physical characteristics of an existing facility so that it may be more effectively utilized for its currently designated purpose or adapted to an alternative use to meet a programmatic requirement.

(2) Costs of alteration and/or renovation required to provide services necessary to implement the Act may be reimbursed as allowable costs in the year(s) incurred up to $150,000 per project.

(3) If the total costs of an alteration and/or renovation project exceed $150,000 over a three-year period, those costs shall be capitalized and depreciated unless the Department grants a waiver allowing for full reimbursement as described below:
(A) The Department shall grant a waiver if the county submits a written request for waiver accompanied by a description of the project and a county board of supervisors' resolution that approves the project.

(B) If the Department does not grant a waiver, the costs may be recovered only through straight line depreciation over the class life of the property, as specified in the "Table of Class Lives and Recovery Periods" in federal IRS Publication 946, "How to Depreciate Property", which is available from any office of the IRS.

(4) If a building is leased, alteration and/or renovation costs shall be allowable provided that the program is responsible under the lease for paying for the alteration and/or renovation, and the alteration and/or renovation meets the criteria contained in this regulation.
(A) If the total cost of the alteration and/or renovation project exceeds $150,000 without Departmental waiver, the alteration and/or renovation shall be considered a leasehold improvement.

(B) The cost of leasehold improvements shall be amortized and may be recovered over the term of the lease(s), but no earlier than June 30, 2006.

(5) Any county contract for drug treatment services containing costs for alterations and/or renovations funded pursuant to the Act shall require such alterations and/or renovations to be used to provide services pursuant to the Act.

(6) If a public or private contractor ceases to provide services pursuant to the Act prior to July 1, 2006, the county shall collect a prorated portion of funding used for alterations and/or renovations from the public or private contractor and shall return such funding to the county trust fund. The amount to be collected shall be prorated by dividing the number of months remaining until June 30, 2006, by the total number of months from approval of the project until June 30, 2006, and multiplying the resulting amount by the total cost of alterations and/or renovations funded pursuant to the Act.

(7) Any alteration and/or renovation that is done shall ensure that the altered portions of the facility comply with (l) of this regulation.

(i) Public or private contractors shall obtain written approval from the county lead agency, in accordance with county requirements, prior to commencement of alterations and/or renovation, construction, leasehold improvements, and equipment purchases, to the extent that SATTF funds will be used to pay for these costs, either in full or through depreciation or amortization. The county shall ensure that reimbursement is in accordance with the limitations and requirements contained in this regulation. Nothing in this regulation shall be construed to limit the county's discretion to be more restrictive in its policies regarding such expenditures.

(j) The county shall monitor and document activities to ensure that:

(1) Use of SATTF funds:
(A) Complies with the provisions of the Act and this regulation, and

(B) Complies with county procedures for procuring property, obtaining consulting services, and awarding contracts; and

(2) SATTF funds are not used to supplant funds from any existing fund source or mechanism currently used to provide drug treatment services in the county.

(k) In providing services reimbursed with SATTF funds under this Chapter, the county shall comply with Article 9.5 (commencing with Section 11135), Chapter 1 of the Government Code.

(l) All programs and services funded pursuant to the Act shall be accessible to persons with disabilities as provided for in the Rehabilitation Act of 1973 as amended (Section 794, Title 29, United States Code) and implementing regulation Title 45, Code of Federal Regulations, Part 84, and the Americans with Disabilities Act of 1990 (Sections 12131 through 12134, Title 42, United States Code) and implementing regulation Title 28, Code of Federal Regulations, Part 35, and the provisions of Assembly Bill 2222 (Chapter 1049, Statutes of 2000). The county and any other entity that receives SATTF funds under the provisions of the Act shall not contract with any entity or expend funds for any program or service that is not in compliance with the disability laws and regulations cited in this subsection.

(m) The county and all entities providing services pursuant to the Act shall maintain confidentiality of client records and information in accordance with Title 42, Code of Federal Regulations, Part 2.

(n) The county shall include the requirements stated in this regulation in all agreements with public or private contractors receiving funds under this Chapter.

1. New section filed 12-26-2000 as an emergency; operative 12-26-2000 (Register 2000, No. 52). A Certificate of Compliance must be transmitted to OAL by 4-25-2001 or emergency language will be repealed by operation of law on the following day.
2. New section refiled 3-22-2001 as an emergency, including amendment of section; operative 3-22-2001 (Register 2001, No. 12). A Certificate of Compliance must be transmitted to OAL by 7-20-2001 or emergency language will be repealed by operation of law on the following day.
3. Repealer and new section filed 4-25-2001 as an emergency; operative 4-25-2001 (Register 2001, No. 17). A Certificate of Compliance must be transmitted to OAL by 8-23-2001 or emergency language will be repealed by operation of law on the following day.
4. Repealer and new section filed 8-17-2001 as an emergency, including amendment of subsections (h)(3)(A) and (h)(7); operative 8-22-2001 (Register 2001, No. 33). A Certificate of Compliance must be transmitted to OAL by 12-20-2001 or emergency language will be repealed by operation of law on the following day.
5. Repealer and new section refiled 12-12-2001 as an emergency, including amendment of subsections (h)(3)(A) and (h)(7); operative 12-20-2001 (Register 2001, No. 50). A Certificate of Compliance must be transmitted to OAL by 4-19-2002 or emergency language will be repealed by operation of law on the following day.
6. Certificate of Compliance as to 12-20-2001 order, including amendment of section, transmitted to OAL 12-19-2001 and filed 1-17-2002 (Register 2002, No. 3).
7. Amendment of section heading and subsections (b) and (h)(5)(7), repealer of subsection (i), subsection relettering and amendment of NOTE filed 6-28-2002 as an emergency; operative 7-1-2002 (Register 2002, No. 26). Pursuant to Statutes of 2001, Chapter 721, section 10, a Certificate of Compliance must be transmitted to OAL by 12-30-2002 or emergency language will be repealed by operation of law on the following day.
8. Certificate of Compliance as to 6-28-2002 order transmitted to OAL 10-15-2002 and filed 11-26-2002 (Register 2002, No. 48).

Note: Authority cited: Section 11755, Health and Safety Code; and Statutes of 2001, Chapter 721, Section 10. Reference: Section 11999.12, Health and Safety Code; and Section 1210(b), Penal Code.

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