BILL ANALYSIS
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|Hearing Date:June 28, 2010 |Bill No:AB |
| |1996 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Gloria Negrete McLeod, Chair
Bill No: AB 1996Author:Hill
As Amended:June 1, 2010 Fiscal: Yes
SUBJECT: Chiropractors: license renewal fee.
SUMMARY: Amends the Chiropractic Initiative Act of California by
increasing the license renewal fees of chiropractors from $150 to
$250.
NOTE : This measure failed passage in this Committee on June 14, 2010,
by a vote of 4-3, and
was granted reconsideration. It is before this Committee today for
Reconsideration and "Vote Only."
Existing law: Establishes the Chiropractic Initiative Act of
California (Initiative Act), approved by voters on November 7, 1922,
and became effective on December 21, 1922. Establishes, under the
Initiative Act, the State Board of Chiropractic Examiners (BCE) to
license and regulate the chiropractic practice, and prescribes the
licensing and renewal fees for chiropractors.
This bill amends the Initiative Act by increasing the license renewal
fees of chiropractors from $150 to $250.
FISCAL EFFECT: According to the Assembly Appropriations Committee,
annual increased fee-supported special fund revenues of $1.3 million
to support enforcement and administration workload for the Board of
Chiropractic Examiners.
COMMENTS:
1. Purpose. According to State Board of Chiropractic Examiners , the
Sponsor of this measure, BCE has implemented significant consumer
protection changes that are necessary to fulfill its consumer
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protection mandate. For example, in 2008, the BCE expanded its
enforcement program to include a permanent field investigation and
inspection program. Continued improvements to investigations are
very important for consumer protection but require resources. With
these necessary enhancements in the BCE's enforcement program and
the increase in costs of doing business, the BCE's current revenue
is inadequate to pay for the level of service that is needed to
protect consumers.
Moreover, BCE points out that it expends approximately 70% of its
operating budget on enforcement. If the renewal fee remains at its
current level, the BCE's fund will be insolvent in FY 2010-11, and
it will be forced to make drastic cuts to its enforcement program.
The BCE points out that it has not raised renewal fees since 1991,
and with no increase in revenue for two decades, it was only a
matter of time until expenditures outpaced the funding necessary
for the BCE to maintain a balance in its reserve and keep its funds
solvent.
2. Background. In 1922, California voters approved the Initiative
Act, described as an act prescribing the terms upon which licensees
may be issued to practitioners of chiropractic, creating the State
Board of Chiropractic Examiners and declaring its powers and
duties, prescribing penalties for violation hereof, and repealing
all acts and parts of acts inconsistent therewith. Among other
provisions, the Initiative Act provides that each applicant must
pay an initial licensure fee of not more than $100, as determined
by the board. Additionally, a licensee must pay a renewal fee
annually of not more than $150 as determined by the board. The
Initiative Act also authorized the Legislature to fix the amounts
of the fees payable by applicants and licensees.
The BCE currently regulates over 14,000 licensed chiropractors in
California. According to the BCE, its annual budget is $3.4
million, funded exclusively by the profession through licensing
fees and other regulatory fees.
3. Committee Fee Bill Worksheet. Included with this analysis is a
"Fee Background Information Questionnaire" which is to be completed
by the Author's office and the board requesting a fee increase.
This Questionnaire is required by the Committee to justify any fee
increases and provide background information on requested fee
increases by the boards under DCA. The Questionnaire is to include
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
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fee amounts. It must also include a 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. It is to provide a schedule
displaying two years of expenditures by program components; such as
application review, examination, enforcement, administration and
other licensing activities for each licensing category. It is to
provide a table comparison of existing and proposed fees which
includes the percentage by which the fee will change. Lastly, it
should provide the history for the past 10 years of legislative fee
increase authorizations.
The worksheet submitted by the Author indicates that the fees proposed
in this bill will be solely for the use of BCE's expanded
enforcement program to include professional and permanent field
investigation staff and an inspection program. The worksheet
indicated that at the current fee rate, the BCE will incur a
deficit of $32,000 beginning in fiscal year 2011-2012. The deficit
will grow to $1,521,000 by fiscal year 2012-2013, and will continue
to increase by approximately $1 million each year thereafter.
4. Neutral. The California Chiropractic Association has taken a
neutral position on this bill and points out that previous
amendments taken on this bill significantly reduce the potential
financial impact on licensees while providing the BCE the money it
needs to enforce the law.
5. Arguments in Support. The International Chiropractors Association
states that this bill would provide the additional moneys that the
BCE needs to better enforce the law and continue to protect
consumers.
SUPPORT AND OPPOSITION:
Support:
California Board of Chiropractic Examiners (Sponsor)
International Chiropractors Association
Southern California University of Health Sciences
Opposition:
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None on file as of June 9, 2010
Consultant: Rosielyn Pulmano