In November 2004, the Children's Hospital Bond Act (Proposition 61) was approved with 58 percent of the vote. Virtually every county in the State supported this measure. This created a $750 million bond opportunity for the Children's Hospitals to purchase the latest medical technologies and to make more room so they can provide care to more children.

Thirteen Children's Hospitals, including the five University of California Children's Hospitals, are the beneficiaries of these bond funds. The eligible hospitals can apply to the California Health Facilities Financing Authority (CHFFA) for project specific grants for construction, improvements and the purchase of new medical technologies at their hospitals. Twenty percent of the total funding has been made available to the five University of California Children's Hospitals (approximately $30 million each). Eighty percent of the total funding (approximately $74 million each) has been made available to the eight regional non-profit Children's Hospitals which qualify under the criteria specified in the initiative.

Given the projects underway, Children's Hospitals will have used nearly 70 percent of the $750 million available under Prop 61 by Spring 2008.

Please visit www.treasurer.ca.gov/chffa for more information about the Children's Hospital Bond Act.

Children's Hospital Bond Act of 2008

The "Children's Hospital Bond Act of 2008" is a statewide bond measure with revenues dedicated to Children's Hospitals to extend and build on the progress made possible by the 2004 Bond Act. These additional funds will make the purchase of new medical technologies and essential facilities expansion possible. It will authorize $980 million for grants of approximately $98 million for each of the qualifying non-profit Children's Hospitals to expand and renovate to make more room to treat more children, and to purchase life-saving medical equipment for the treatment of the most seriously ill and injured children in the State. It would also authorize approximately $39 million for grants to each of the University of California Children's Hospitals.  

Who are the Children's Hospitals? How does a hospital qualify for funding?

California has 13 Children's Hospitals, including eight private, not-for-profit hospitals and five University of California Children's Hospitals. These hospitals serve as regional, tertiary-care centers and provide specialized care to treat children with the most serious and life-threatening diseases like childhood leukemia, cancer, heart defects, sickle cell anemia, diabetes and cystic fibrosis. Each hospital is unique, but all share the common mission of improving the health and well being of California's children. These hospitals are California's pediatric health care safety net, caring for the majority of the State's low-income children. These Children's Hospitals treat over one million children's injuries and illnesses each year without regard to a family's ability to pay.

Any private, non-profit Children's Hospital that meets the eligibility criteria specified in the legislation can apply for a grant to the California Health Facilities Financing Authority for a specific project, once the initiative is approved by voters. The following private, non-profit Children's Hospitals have been identified as meeting the eligibility criteria and could apply for project-specific grant funding:

Children's Hospital Central California
Children's Hospital of Orange County
Childrens Hospital Los Angeles
Children's Hospital & Research Center at Oakland
Loma Linda University Children's Hospital
Miller Children's Hospital
Lucile Packard Children's Hospital at Stanford
Rady Children's Hospital - San Diego

As specified in the legislation, the following University of California Children's Hospitals could apply for a grant to the California Health Facilities Financing Authority for a specific project, once the initiative is approved by voters:

Mattel Children's Hospital at UCLA
University Children's Hospital at University of California Irvine
University of California, Davis Children's Hospital
University of California, San Diego Children's Hospital
University of California, San Francisco Children's Hospital

Why is there a need for this bond?

As the population in California continues to grow, we must increase the capacity of our Children's Hospitals in order to keep pace. More children need services at a Children's Hospital then there is room.

Advances in technology and research are bringing hope to children and their families where there was no hope before. Medical technology improvements occur rapidly, especially with regard to the most serious childhood illnesses. Children's Hospitals must have access to the latest technology in order to effectively treat these seriously ill children.

Without continued capital investment in medical equipment and facilities, Children's Hospitals' equipment and facilities cannot keep pace with the needs of California's burgeoning population of children, which the Department of Finance projects to grow by 35 percent over the next two decades.

What kind of projects will be funded under this proposed bond?

Statewide, a variety of projects are underway or in the planning stage. Examples of possible projects include complete new hospitals and inpatient tower expansions and renovations; outpatient center expansions and construction; Neonatal Intensive Care Units (NICU) and Pediatric Intensive Care Units (PICU) expansions; Emergency Department (ED) renovations and expansions; surgical suite expansion and renovations; cancer center renovations; and, the purchase of state-of-the-art medical equipment.

How will the bond money be divided among the Children's Hospitals?

Twenty percent of the total funding will be made available to the five University of California Children's Hospitals. Eighty percent of the total funding will be made available to non-profit Children's Hospitals that qualify under the criteria specified in the legislation, each of which can apply for grants up to a maximum of $98 million.

The division of the funds is proportional to the number of patients seen and treated at the State's Children's Hospitals.

Why do the Children's Hospitals need more funding than was authorized by Proposition 61 in 2004?

The escalating cost of construction, as well as the growing population of California children, has created capital and capacity challenges for Children's Hospitals. Planned and needed hospital projects will cost each Children's Hospital hundreds of millions of dollars. Seeking bond funds is the only realistic opportunity to fund the necessary improvements and expansions. 

A recent RAND report confirms what the Children's Hospitals have been experiencing: Since 2001, hospital construction costs in the State have almost doubled. In California, the finished cost of a fully furnished and equipped new hospital building is about $1,000 per square foot - more than three times that of a new office building.

Funds generated by the successful passage of Proposition 61 in November 2004 with 58 percent of the vote have been critically important to helping Children's Hospitals begin their expansion and renovation projects. But the capital needs of Children's Hospitals far exceed the funds authorized in 2004. Nearly 70 percent of the funds from Proposition 61 will have been committed by April 2008.