Court Opinion

ID: 5661676
Source: CourtListenerOpinion
Date Created: 2022-01-12 00:55:40.383706+00
Date Added: 2024-06-11T08:39:03.210326
License: Public Domain

TAMURA, J.
I dissent. The majority’s use of the adjective “absurd” to characterize the agency’s interpretation of the scope of the exemptions authorized by Health and Safety Code section 437.13 is wholly unwarranted. While statutory interpretation is ultimately a judicial function, the interpretation of a statute by the agency charged with its administration and enforcement is entitled to great weight and should be followed unless it is “clearly erroneous.” (Judson Steel Corp. v. Workers’ Comp. Appeals Bd. (1978) 22 Cal.3d 658, 668-669 [150 Cal.Rptr. 250, 586 P.2d 564]; Wilkinson v. Workers’ Comp. Appeals Bd. (1977) 19 Cal.3d 491, 501 [138 Cal.Rptr. 696, 564 P.2d 848]; Rivera v. City of Fresno (1971) 6 Cal.3d 132, 140 [98 Cal.Rptr. 281, 490 P.2d 793]; State Compensation Ins. Fund v. Workers’ Comp. Appeals Bd. (1979) 88 Cal.App.3d 43, 53-54 [152 Cal.Rptr. 153].) The majority fails to give the agency’s interpretation the weight and respect to which it is entitled.
Appellant proposed to add to its hospital a new wing consisting of approximately 3,290 square feet to house 7 new two-bed patient rooms to be relocated from existing three-bed patient rooms while retaining all of its existing space. The expansion of floor space which appellant terms “incidental” actually amounted to roughly 14 percent of the existing floor space devoted to nursing services. The agency determined that the proposed project was an expansion of hospital facilities—not a remodeling or replacement of existing facilities—and was, therefore, beyond the scope of the exemptions authorized by section 437.13.
The agency’s interpretation of the section 437.13 exemptions is consistent with the language and intent of the section and the spirit of the Health Planning Act (Health & Saf. Code, § 437 et seq.) of which it is *856a part. One of the purposes of the Health Planning Act was to retard the spiraling cost of medical care by curbing proliferation of superfluous hospital facilities, beds, and services. (Bakersfield Community Hosp. v. Department of Health (1977) 77 Cal.App.3d 193, 198-199 [142 Cal.Rptr. 773].) In furtherance of that objective, the act requires a certificate of need for hospital capital expenditures unless the project comes within the exemptions authorized by section 437.13. Consistent with the goal of the Health Planning Act, exemptions authorized by section 437.13 are to be strictly construed so as to avoid circumvention of state health planning procedures. (Bakersfield Community Hosp. v. Department of Health, supra, 77 Cal.App.3d 193, 198.) The majority’s interpretation of the statutory exemptions would, as the agency argues, open the flood gates for expansion of hospital physical facilities under the guise that the expansion is only incidental to the “remodeling” or “replacement” of existing facilities. The extent and nature of the expansion would depend upon the ingenuity and imagination of the applicant and not upon need.
The majority attempts to brush off as “untenable” the agency’s argument that if the Legislature had intended to permit exemptions of expansion projects under section 437.13, it could have simply provided for an exemption for “modernization” rather than for remodeling and replacement. The argument is persuasive. The word “modernization” is defined in section 437.10 relating to projects requiring a certificate of need as “the alteration, expansion, repair, remodeling, replacement, or renovation of existing buildings, including initial equipment thereof, and the replacement of equipment of existing buildings.” (§ 437.10, subd. (e)(3).) It may be argued, therefore, that the Legislature must have intended the words “remodeling” and “replacement” in section 437.13 to have a more restrictive meaning than “modernization” or “expansion.”
The agency’s explanation as to why it reexamined and revised its interpretation of section 437.13 is logical. The 1977 amendments to section 437.13 (Stats. 1977, ch. 1198, eff. Jan. 1, 1978) tightened controls over hospital construction by requiring remodeling or replacement projects in hospitals with records of less than 80 percent occupancy to include reduction of licensed bed capacity. The amendment, although it did not change the language of the section pertinent to the instant claim of exemption, did constitute an expression of legislative concern over needless hospital remodeling or replacement projects. It was reasonable, *857therefore, i" the agency to reexamine and revise its past interpretation of the exeption statute to bring it into conformity with the legislative will. The cord discloses that since early 1978 the agency has consistently deed exemptions for projects similar to that proposed by appellant
The alley’s interpretation of the exemption statute is reasonable and consent with the legislative intent; it is by no means an absurd or untenab interpretation. The trial court correctly determined that the agency’denial of appellant’s application for a certificate of exemption was ne'ier arbitrary, capricious, nor unreasonable.1
I wdd affirm the judgment.
A tition for a rehearing was denied July 1, 1980. Tamura, J., was of thopinion that the petition should be granted.

Appellant is not foreclosed from going forward with its project. It may still apply for and obtain a certificate of need under section 437.10 if it is able to demonstrate that a 14 percent increase in floor space is actually needed in order for it to deliver health care services effectively.