BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 55
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          SENATE THIRD READING
          SB 55 (Corbett)
          As Amended  December 10, 2009
          2/3 vote.  Urgency
           
          SENATE VOTE  :  Vote not relevant
            
           NATURAL RESOURCES                            APPROPRIATION 
                         (vote not relevant)                           
          (vote not relevant)
           
          SUMMARY  :  Continues the State Bar's authority to assess and  
          collect dues from licensed attorneys in California in order to  
          support the State Bar's operations, including discipline.   
          Specifically,  this bill  :

          1)Authorizes the State Bar to continue to collect active  
            membership dues of up to $410 for the year 2010, maintaining  
            2009 dues levels.

          2)Provides that the State Bar shall have a preference for using  
            in-house employees for information technology (IT) projects,  
            whenever possible.  Further provides that nothing in the bill  
            shall be read to be inconsistent with any memorandum of  
            understanding between the State Bar and the recognized  
            employee organizations or any relevant principles of labor  
            law.

          3)Increases the State Bar's informal bid contracting authority  
            limits from $50,000 to $100,000 for contracts for IT goods  
            and/or services, as specified.

          4)Requires the State Bar to report to the Senate and Assembly  
            Judiciary Committees on or before April 1, 2010, and annually  
            thereafter, on the impact of the changes made per 3) above.   
            In addition to a description of the impact of those changes,  
            the report shall include, with specificity, the following:  

             a)   The projects that previously would have been required to  
               comply with Article 4 (commencing with Section 10335) of  
               Chapter 2 of Part 2 of Division 2 of the Public Contract  
               Code, but are no longer subject to that requirement because  
               the contract amount is between $50,000 and $100,000; and,

             b)   Whether the changes have improved the efficiency of the  








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               contracting process.  This provision sunsets on January 1,  
               2014.

          5)Provides that the fees paid by limited liability partnerships  
            (LLPs) and law corporations to the State Bar shall be used for  
            its regulatory and disciplinary purposes.

          6)Provides that at the time of filing an Application for  
            Issuance of a Certificate of Registration as a LLP pursuant to  
            the Rules of the State Bar, an applicant for registration  
            shall also file with the State Bar a separate form stating  
            that the limited liability partnership has complied with the  
            security requirements described in paragraph (2) of  
            subdivision (a) of Section 16956 of the Corporations Code.

          7)Adds an urgency clause.
           
          EXISTING LAW  :

           1) Requires all attorneys who practice law in California to be  
             members of the State Bar and establishes the State Bar for  
             the purpose of regulating the legal profession.  Pursuant to  
             the State Bar Act, the annual mandatory membership fee set by  
             the State Bar's Board of Governors to pay for discipline and  
             other functions must be ratified by the Legislature.

           2) Authorizes the State Bar to collect $315 in annual  
             membership fees from active members for a total annual dues  
             bill of $410 for the year 2009.  The other $95 is pursuant to  
             statutory authorization to assess annually the following  
             fees:  

              a)    $40 for the Client Security Fund; $25 for disciplinary  
                activities;

              b)    $10 to fund the Lawyer Assistance Program;

              c)    $10 special assessment to fund information technology  
                upgrades (expires January 1, 2011); and,

              d)    $10 for the Building Fund (expires January 1, 2014).

           3) Authorizes the State Bar to collect $75 in annual membership  
             fees from inactive members for a total annual dues bill of  
             $125 for the year 2009.  The other $50 is pursuant to  








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             statutory authorization to assess annually the following  
             fees:  

                  a)        $10 for the Client Security Fund; 

                  b)        $25 for disciplinary activities;

                  c)        $5 to fund the Lawyer Assistance Program; and,

                  d)        $10 for the Building Fund (expires January 1,  
                    2014).

           1) Prohibits the use by the State Bar of mandatory dues to fund  
             political and ideological activities, as a violation of a  
             member's First Amendment freedom of speech rights, where such  
             expenditures were not necessarily or reasonably incurred for  
             the purpose of regulating the legal profession or improving  
             the quality of the legal services available to the people of  
             the state.  Existing law allows members to deduct up to $10  
             from the mandatory dues if the member does not wish to fund  
             legislative activities and non-Keller lobbying and activities  
             with his or her dues.  (Keller v. State Bar of California  
             (1990) 496 U.S. 1.)

           2) Requires LLPs and law corporations to register with the  
             State Bar.

           3) Prohibits the State Bar from awarding a contract for goods  
             and/or services for more than $50,000 unless it complies with  
             specified public contracting requirements.

           FISCAL EFFECT  :  None
           
          COMMENTS  :  This bill reauthorizes the State Bar to collect  
          annual membership fees for 2010, keeping with the typical  
          approach of an annual dues authorization bill to ensure the  
          State Bar is appropriately funded and provide helpful and  
          appropriate legislative oversight of the State Bar's many  
          important functions.  The bill authorizes the State Bar to  
          continue to collect active membership dues of up to $410 for the  
          year 2010, maintaining 2009 dues levels.  It would also clarify  
          that the State Bar can deposit fees collected from law  
          corporations and limited liability companies in the State Bar's  
          general fund to be used for regulatory and disciplinary  
          purposes.  This change is intended to assist the State Bar in  








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          its non-dues revenue adjustments to help ensure that it can  
          fulfill its public protection and member services roles.  This  
          bill would also increase the State Bar's informal bid  
          contracting authority limits from $50,000 to $100,000 for IT  
          contracts only.  The increased threshold for these contracts is  
          intended to help provide the State Bar with greater flexibility.  


          The State Bar has indicated that it is planning to implement the  
          following cost reduction measures:  1) defund 46 vacant  
          positions totaling a 9% workforce reduction (saves $4 to $5  
          million annually); 2) end General Fund subsidy of the Lawyer's  
          Assistance Fund and implement plans to reduce funding to the  
          statutory minimum (saves approximately $300,000 in 2010 and  
          increasing in future years); and, 3) end the print edition of  
          the CalBar Journal in 2010 (saves approximately $1.1 million  
          annually).

          This bill is identical to SB 641 (Corbett), which passed this  
          house overwhelmingly (75-1), except that this bill includes an  
          urgency clause and postpones the date by which dues must be  
          submitted for one month (March 1) to reflect that dues  
          statements will be issued later than usual because of the  
          Governor's veto of SB 641.  The author and sponsor report that  
          the State Bar has acted responsibly to address the issues raised  
          in the Governor's veto message.

          If not enacted, the State Bar would be required to begin  
          immediately procedures for a layoff process that would result in  
          formal layoff notices being sent in the first week of January.   
          Supporters state that this would be crippling to the State Bar's  
          essential mission of public protection against unethical  
          attorneys.


           Analysis Prepared by  :   Kevin Baker / JUD. / (916) 319-2334


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