Legal Question in Immigration Law in California

Yes, that's correct - provided that the minor child resides in that parent's custody in the USA as a lawful permanent resident.

The child shall apply for a certificate of citizenship (instead of naturalization) and the U.S. passport.

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Yes, it is a simpler process. A parent who is a U.S. citizen can submit application for certificate of citizenship for his/her child, provided that the child is a lawful permanent resident and resides in the U.S. in the custody of his/her USC parent.