BILL ANALYSIS
----------------------------------------------------------
|Hearing Date:April 14, 2008 |Bill No:SB |
| |1584 |
----------------------------------------------------------
SENATE COMMITTEE ON BUSINESS, PROFESSIONS AND ECONOMIC
DEVELOPMENT
Senator Mark Ridley-Thomas, Chair
Bill No: SB 1584Author:Padilla
As Introduced: February 22, 2008 Fiscal: Yes
SUBJECT: Veterinary medicine: fees.
SUMMARY: Increases the fee amount charged for veterinarian
licensing, registered veterinary technician registration,
registered veterinary technician schools and creates new fees to
be paid by these licensees for services provided to them by the
Veterinary Medical Board.
Existing law:
1)Provides for the licensing and regulation of
veterinarians, registered veterinary technicians and
veterinary hospitals by the Veterinary Medical Board
(VMB) in the Department of Consumer Affairs.
2)Requires the VMB to establish an advisory committee on
issues pertaining to the practice of veterinary
technicians, to be known as the Registered Veterinary
Technician (RVT) Committee.
3)Provides that the duties of the RVT Committee include,
among other things, advising and assisting the VMB in:
the examination of applicants for veterinary technician
registration; the inspection and approval of schools;
and, developing regulations to establish animal health
care tasks and the appropriate degree of supervision.
4)Requires the VMB to set (by regulation) and collect
various fees, including, but not limited to, a licensing
examination fee for veterinarians, a registration fee for
SB 1584
Page 2
veterinary technicians, a diversion program registration
fee, and an application fee for schools seeking approval
of a registered veterinary technician curriculum.
5)Requires the VMB to establish diversion program (Program)
criteria and provides that the Program cannot accept more
than 100 participants. Additionally, authorizes the VMB
to establish diversion evaluation committees (DEC) and
provides for the DEC composition and duties.
This bill:
1)Increases the maximum fee and creates new fees the VMB may
charge for various licensing and regulatory activities as
follows:
a) Registered veterinarian technician application exam fee
from $200 to $350.
b) Initial registered veterinarian technician registration
fee from $100 to $350.
c) Biennial registered veterinarian technician renewal fee
from $100 to $350.
d) School application fee from cost of approval process to
a flat $300 fee plus actual cost.
e) Failure to report a change in mailing address from $15
to $25 for veterinarians and new fee for registered
veterinarian technicians.
f) Diversion program registration fee from $1,600 to
$4,000.
g) Veterinarian application exam fee from $100 to $350.
h) Board exam fee for veterinarians from $150 to $350.
i) Veterinary Medicine Practice Act exam for veterinarians
from $50 to $100.
j) Initial veterinarian license fee from $250 to $500.
aa) Biennial veterinarian renewal fee from $250 to $500.
bb) Veterinarian temporary license fee from $125 to $250.
cc) Veterinary premise fee from $100 to $400.
dd) Issuance of a duplicate veterinarian license from $10
to $25.
ee) Duplication or other services (other than a license)
from making a charge to the cost of rendering the service.
ff) Delinquency fee from $25 to $50.
2)Requires registered veterinarian technicians to notify the VMB
SB 1584
Page 3
of any changes to their mailing address within 30 days of the
change.
3)Updates various code sections to reflect the change in the
name of the technician from animal health technician to
registered veterinary technician.
FISCAL EFFECT: Unknown. This bill has been keyed "fiscal"
by Legislative Counsel.
COMMENTS:
1.Purpose. According to information provided by the Author's
office, this measure is intended to ensure that the VMB is
able to continue performing critical licensing and enforcement
functions that protect consumers and animals throughout
California.
2.Background.
a) Funding Board Operations. The VMB licenses and
regulates approximately 17,000 licensees including,
approximately 9,800 veterinarians, 4,200 registered
veterinary technicians and 2,600 veterinary hospitals. The
VMB has remained within its statutory limits and has not
sought legislation to increase the fee ceilings since 1992
(in over 16 years). According to the VMB, it increased its
fees through the regulatory process on October 1, 2007, to
the current statutory maximums; not to fund new programs,
but to cover increasing costs of existing business
operations. The fee increase in October 2007 was minimal
due to the current statutory fee ceilings and is not
sufficient to offset a dwindling Contingent Fund.
According to the VMB, it understands that fee increases
impact business, the profession and consumers and would not
propose increases without considering all options.
However, now, based on projections of a Contingent Fund
deficiency by the year 2011-2012, outlined in fund
conditions projections prepared by the Budget office of the
Department of Consumer Affairs, the VMB believes it must
request an increase in its fee ceilings. The VMB states
that the proposed fee ceilings are based on an annualized
inflation rate of three (3) percent.
The VMB is mandated by law to maintain a minimum of three
SB 1584
Page 4
months of revenue in its Contingent Fund to insure funding
for existing programs and to offset increases in the cost
of doing business. For example, according to the VMB, in
the last few years the hourly rate for the Office of the
Attorney General increased from $139 to $158, increasing
the annual expenditure from $240,000 to $425,000. The VMB
points out that other expenditure increases over the last
few years include examination development costs, employee
compensation and benefits, retirement, worker's
compensation, rent and advancements in information
technology systems. Additionally, a transition to online
licensing, scheduled to begin in 2010, required a
conversion to an automated Applicant Tracking System and a
one-time cost in 2007 of $83,000. Operating cost increases
are deducted directly out of the VMB's Contingent Fund.
According to the VMB, it is continually evaluating ways to
control or reduce expenditures and maintain a viable
Contingent Fund. Currently, the VMB has reduced the number
of examination development workshops each year and is
considering the possibility of using the national
veterinary technician examination instead of a California
examination.
b) Diversion Program. The VMB first implemented the
statutorily mandated Drug and Alcohol Diversion Program
(Program) in 1984. The Program's goal is to identify and
rehabilitate veterinarians and registered veterinary
technicians with impairment due to drugs and alcohol so
that they may return to practice in a manner that will not
endanger the public's health and safety. The VMB has an
interagency agreement with Maximus to provide confidential
intervention, assessment, referral, and monitoring services
to administer the Program. Established in 1982, existing
law allows the Board to charge participants $1,600. This
bill proposes to increase the fee to $4,000. The
justification for this increase is that the VMB currently
pays $2,820 per year per participant in the diversion
program, while the participants charge is capped at $1,600
total cost . Since a participant may be in the diversion
program from 3 to 4 years, the VMB is out of pocket a
substantial sum.
In 2003, the then Joint Legislative Sunset Review Committee
(JLSRC) examined the VMB's Diversion Program and indicated
that it is rare that participants are able to cover the fee
SB 1584
Page 5
due to their loss of income during recovery and the VMB's
Program appears to have a low successful completion rate.
Since 1984, however, many more treatment options have
become available to the general public and to
professionals. Because of this availability and the low
successful completion rate, both the VMB and the JLSRC
recommended that the legislature review the effectiveness
of the diversion program as it currently exists.
This Committee recently held a hearing on board diversion
programs. There appeared to be many inconsistencies
between the various programs and concern about the
utilization of a singular program, Maximus, which has not
been reviewed or audited to determine its effectiveness and
efficiency in providing administration of several drug
diversion programs for boards. There is also concern
whether boards should have to pay for any of the expenses
incurred by the practitioner while participating in a
treatment program.
The Committee may want to consider whether participants
should pay for their own costs while participating in a
diversion program rather than being subsidized by the VMB .
c) Address Change. Existing law requires veterinarians to
inform the VMB of mailing address changes within 30 days
and allows the VMB to assess a $15 fee for failure to
comply. Of note, there is a change of address form on the
VMB's website which can be completed and faxed or mailed to
the VMB. This bill additionally requires registered
veterinarian technicians to provide updated mailing address
changes to the VMB and allows the VMB to assess a $25 fee
for failure by either a veterinarian or a registered
veterinarian technician to comply.
3.Fee Background Information Questionnaire Completed. Included
with this analysis is a "Fee Background Information
Questionnaire" which was completed by the Author's Office.
This Questionnaire is required by the Committee to justify any
fees increases and provide background information on requested
fee increases by the boards under DCA. The Questionnaire
includes fund condition statements displaying five years of
actual and five years of projected expenditures and revenues
with (a) current statutory maximum fee amounts, and (b)
proposed statutory maximum fee amounts. It also includes a
SB 1584
Page 6
schedule of fee revenue by various fee "categories" displaying
five years of actual and five years of projected revenue based
on (a) current fees and (b) proposed fees and includes the
workload (e.g., number of licensees) and fee charged per
category. Provides a schedule displaying two years of
expenditures by program component, such as application review,
examination, enforcement, administration and other licensing
activities for each licensing category. Provides a table of
comparison of existing and proposed fees which includes the
percentage by which the fee will change. Lastly, provides the
history for the past 10 years of legislative fee increase
authorizations.
4.Arguments in Opposition. According to its letter of
opposition, the California Veterinary Medical Association
(CVMA) indicates it is unable to support SB 1584 at this time
due to significant concerns with the several facets of the
VMB's performance.
The CVMA states it has had ongoing frustrations with the VMB's
inspection and enforcement program. In particular, it is
concerned about the fact that while veterinarians must comply
with the law, the VMB's inspectors and consultants have been
unable to apply consistent, clear, and fair enforcement
standards to countless cases. Thus, the CVMA would argue that
the fee increase could reinforce the current, defective system
of enforcement practice.
The other main concern the CVMA has with the Board is the
dominance of the RVT Committee. In particular, it is the
CVMA's contention that the RVT Committee has been
significantly exceeding its directive and the CVMA is
concerned that the new fees could be used to bolster the
Committee's current controversial legislative and regulatory
platform.
Finally, the CVMA points out that in many cases, the bill
proposes to raise the fee caps by double if not triple the
current level while the VMB has not spelled out how they plan
to utilize the various fee increases. Therefore, the CMVA
indicates it opposes this bill until it has a better
understanding of the need for the fees, and the way they will
be applied to address consumer protection and proper
enforcement.
5.Policy Issue : "Can't We All Just Get Along?" Today the
SB 1584
Page 7
Committee will also be hearing SB 1205 (Aanestad), a measure
sponsored by the CVMA to address many of the criticisms
leveled at the VMB above. However, these changes do not come
without costs to the VMB. Although the VMB has not taken an
official position on
SB 1205 since amended on April 9, 2008, the VMB will be meeting
on Wednesday, April 16, 2008, to review this measure. If the
VMB supports the changes proposed in CVMA to address the
issues they raise concerning VMB then conversely the CVMA
should support the efforts of the VMB to raise fees necessary
to support its operation and programs. It appears that the
VMB has provided sufficient justification to raise the caps in
its fee structure, as both indicated by the DCA and from the
information received by the Committee in response to the
Questionnaire.
SUPPORT AND OPPOSITION:
Support: California Veterinary Medical Board
Opposition: California Veterinary Medical Association
Consultant:Bill Gage