DOF Notifies Legislature of $495m Down Payment for Masks, Legislature Wants Tracking Webpage

The Department of Finance (DOF) on Tuesdayissued a letter to Senate and Assembly Budget and Appropriations Committee chairs notifying the Legislature of the California Office of Emergency Services’ (Cal OES) intent to make an initial down payment of $495 million to secure a newly established supply chain of masks in response to the COVID-19 pandemic. The move by the Newsom Administration is expected to provide 200 million masks per month and total $990 million.

To make the initial $495 million down payment, the Department of Finance indicated it was cobbling together $188 million from the Legislature’s emergency funding appropriation made last month and $307 million from the state’s Disaster Response-Emergency Operations Account (DREOA). Recall, DOF notified the Legislature late last month of a $1.3 billion transfer to the DREOA to assist in COVID-19 response efforts.

The remaining $495 million for the masks is expected to be paid as deliveries are received by the state; DOF has not yet identified a funding source for the remaining payments. In its letter, DOF reiterated the continued need for PPE and masks by health care workers, caregivers, and other essential sector employees. To date, California has ordered approximately $1.4 billion in PPE. DOF contended this new supply chain will allow the state access to a dependable supply of PPE and allow the state’s procurement team to concentrate efforts on other critical supplies and equipment.

In response to DOF’s notification, Joint Legislative Budget Committee (JLBC) Chair Senator Holly Mitchell on Thursday penned a letter requesting that the Newsom Administration provide the JLBC with a series of details related to the mask expenditure, including the performance standards of the vendor and manufacturer, the price per mask, the quality standards the masks are required to meet, the production and delivery times, and the efficacy of technology to be utilized to decontaminate masks that will be reused. Furthermore, Senator Mitchell called on the Newsom Administration to provide details on how it plans to prioritize masks between different jurisdictions within the state and different categories of users (e.g. health care workers, first responders, grocery workers).

If masks and other PPE are to be allocated outside of California, Senator Mitchell requested the Newsom Administration detail to the JLBC how it was determined that such masks would not be needed by California, what out-of-state entities would receive masks and PPE items, the amount of masks each entity would receive, how it was determined that these entities should receive masks, and whether the state would be reimbursed for any masks provided to out-of-state entities. Mitchell also urged the Administration to secure assurances from FEMA that these supplies will remain in California and not be commandeered or seized by the federal government.

In light of the significant spending commitments made for PPE items and other medical equipment, Senator Mitchell requested that the Administration launch, no later than early next week, a regularly updated webpage that describes the state’s inventory of each major type of equipment and the destinations of each outgoing shipment, including quantities shipped by county, city, and categories of users including health facilities and other essential workers. Mitchell requested the webpage include the percentage of requested equipment that has been fulfilled by county or public health jurisdiction and any state or local guidance specifying a priority order for distribution within each jurisdiction.

Mitchell further noted the Legislature and JLBC recognizes the need to respond quickly to the ongoing COVID-19 pandemic and urged the Administration to act quickly to provide more information that tracks the supply and demand of PPE throughout the state. Ultimately, Mitchell concurred with the Newsom Administration’s spending request with the understanding that the Administration will provide the Legislature the information it has requested.