CENTRAL SERVICE COSTS RECOVERY – INTRODUCTION TO CENTRAL SERVICE COSTS - 9215

(Renumbered: 01/2022)

(Revised and renumbered from 8753)

Central service costs are those amounts expended by central service agencies/departments and the Legislature for the overall administration of state government and for providing centralized services to state agencies/departments. These functions are necessary for state operations and are centralized to provide efficient and consistent statewide policy and services. Central service agencies/departments include:

• California State Auditor’s Office
• California State Library
• Department of Technology
• Department of Finance
• Department of Human Resources
• Department of Justice
• Department of FISCal
• Governor’s Office
• Department of General Services
• Legislative Counsel Bureau
• California State Legislature
• Office of Administrative Law
• Governor’s Office of Planning and Research
• Secretary of the California Health and Human Services Agency
• State Controller’s Office
• State Personnel Board
• State Treasurer’s Office

Central service costs are funded by the General Fund and the Central Service Cost Recovery Fund appropriations made to each central service agency/department. The central services benefit most funds and agencies/departments. For equity, Government Code sections 11270–11275 and 22883 provide for the sharing of central service costs by funds other than the General Fund and the Central Service Cost Recovery Fund. This cost sharing process is titled formally as "General Administrative Costs" but is known more commonly as "Pro Rata." See explanation provided in SAM section 9215.1.

In addition to administering the Pro Rata central service costs sharing, the Department of Finance, Fiscal Systems and Consulting Unit (FSCU), prepares a Statewide Cost Allocation Plan (SWCAP) each year. SWCAP is a cost allocation plan which apportions federally allowable central service costs to agencies/departments. Therefore, differences exist in the central service costs contained in the two plans.

The central service functions included in Pro Rata and SWCAP are listed below:

Central Service Plans

Central Service Function	Pro Rata Only	SWCAP Only	Both
Department of Finance:
Audits			X
Budgets			X
Fiscal Systems and Consulting Unit (FSCU)			X
Department of Technology			X
State Controller’s Office:
Accounting and Reporting			X
Audits - Claim Audits			X
Disbursements			X
Audits – Field Audits			X
Personnel/Payroll Services Division and Information Systems Division			X
State Treasurer’s Office:
Investment	X
Item Processing			X
Centralized Treasury and Security Management Division and Public Finance Division			X
Department of FISCal			X
State Personnel Board			X
Department of Human Resources (CalHR)			X
Office of Administrative Law			X
California State Library			X
Health Benefits for Annuitants (Retired)			X
Dental Benefits for Annuitants (Retired)			X
Health Benefits for Annuitants (Retired CSU)			X
Secretary of the California Health and Human Services Agency			X
California State Auditor’s Office			X
Department of General Services
Contracted Fiscal Services			X
Department of Justice:
Legal Costs		X
Tort Liability		X
California State Legislature	X
Legislative Counsel Bureau	X
Governor’s Office	X
Governor’s Office of Planning and Research	X

 

The costs of the central services listed above are allocated on the basis of services provided. To do this, FSCU determines the appropriate workload base for each central service. Actual workload units are accumulated for each agency/department. Then, central service costs are charged to the funds on the basis of these workload units.