BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 202
                                                                  Page  1


          SENATE THIRD READING
          SB 202 (Harman)
          As Amended  July 1, 2009
          Majority vote 

           SENATE VOTE  :33-0  
           
           BUSINESS & PROFESSIONS     10-0 APPROPRIATIONS      16-1        
           
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          |Ayes:|Hayashi, Emmerson,        |Ayes:|De Leon, Conway, Ammiano, |
          |     |Conway, Eng               |     |                          |
          |     |Hernandez, Nava, Niello,  |     |Charles Calderon, Coto,   |
          |     |John A. Perez. Ruskin,    |     |Davis,                    |
          |     |Smyth                     |     |Fuentes, Hall, Harkey,    |
          |     |                          |     |Nielsen,                  |
          |     |                          |     |John A. Perez, Skinner,   |
          |     |                          |     |Solorio, Audra            |
          |     |                          |     |Strickland, Torlakson,    |
          |     |                          |     |Hill                      |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |Nays:|Miller                    |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Requires private investigators (PIs), as a condition  
          of license renewal, to complete 12 hours of continuing education  
          (CE) in privacy rights, professional ethics, recent legal  
          developments, and other subjects related to the profession, and  
          makes other regulatory changes, as specified.  Specifically,  
           this bill  :   

          1)Requires licensed PIs, beginning January 1, 2013, as a  
            condition of license renewal, to complete 12 hours of CE as  
            follows:  two hours in the subject of privacy rights, two  
            hours in the subject of professional ethics, two hours on the  
            subject of recent legal developments relating to PIs, and six  
            hours on any subject relating to PIs.

          2)Requires licensed PIs whose license is subject to renewal  
            between January 1, 2012, and January 1, 2013, to complete six  
            hours of CE, as approved by DCA, in order to renew his or her  
            license, and of these, two hours shall be on the subject of  
            privacy rights, two hours shall be on the subject of  








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            professional ethics, and two hours shall be on the subject of  
            recent legal developments relating to private investigators.

          3)Exempts a licensed PI who is a retired peace officer for less  
            than a year from CE requirements.

          4)Requires a licensed PI who is a retired peace officer for more  
            than a year to complete six hours of CE, as approved by DCA,  
            in order to renew his or her license, and of these, two hours  
            shall be on the subject of privacy rights, two hours shall be  
            on the subject of professional ethics, and two hours shall be  
            on the subject of recent legal developments relating to  
            private investigators.

          5)Requires a licensee to submit to the Department of Consumer  
            Affairs (DCA) a signed statement attesting that the licensee  
            has completed the specified CE requirements with a license  
            renewal application. 

          6)Requires a licensee to maintain copies of certificates  
            demonstrating completion of the required CE courses for five  
            years. 

          7)Authorizes DCA to suspend (up to 60 days) or revoke the  
            license of a PI for his/her failure to comply with the CE  
            requirements.  The DCA shall have the right to audit the  
            records of any licensee to verify completion of the CE  
            requirement.

          8)Exempts from the mandatory CE requirements:

             a)   Licensed individuals at least 70 years old whose license  
               has been in good standing for a minimum of 25 consecutive  
               years; and, 

             b)   Inactive licensed investigators.

          9)Defines an "inactive licensed investigator" as an individual  
            who is licensed and has informed DCA that he/she will not be  
            performing activities that require licensure, and does not  
            perform such activities. 

          10)Allows an inactive licensed PI to become active upon  
            submitting to the DCA a signed statement that he/she has  








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            completed the specified CE requirements and paying a renewal  
            fee.

          11)Requires DCA to develop a procedure for approving continuing  
            education providers (CEPs), convene a review panel to consult  
            with DCA in its consideration and approval of CEPs and course  
            content, and develop criteria for CEPs and CE courses.  The  
            review panel shall include private PIs, representatives of  
            CEPS and professional associations of licensed PIs.

          12)Requires CEPs to obtain DCA approval to provide required CE  
            courses.

          13)CEPs shall:

             a)   Obtain approval from DCA prior to offering a CE course  
               to licensed PIs; 

             b)   Submit to DCA a course description, certificate, and  
               curriculum vitae of course instructors for review and  
               approval;

             c)   Maintain a record of course sign-in forms, sign-out  
               forms, student enrollment, copies of certificates of  
               completion, and course outlines for a period of five years;  
               and, 

             d)   Agree to audits performed by DCA.

          14)Authorizes DCA to revoke or deny the right of a CEP to offer  
            the required PI CE courses for failure to comply with any of  
            these requirements.

          15)Authorizes CEPs approved by and in good standing with the  
            State Bar to provide mandatory continuing legal education, to  
            offer CE to licensed PIs without approval from DCA. 

          16)Authorizes CEPs approved by and in good standing with the  
            Commission on Peace Officer Standards and Training, to offer  
            CE to licensed PIs without approval from DCA. 

          17)Requires DCA to establish and charge CEPs a fee, not to  
            exceed $20 per course, to cover DCA's direct costs in  
            implementing PI CE requirements and developing criteria for  








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            CEPs and course content. 

          18)Specifies that any applicant who knowingly signs a false  
            statement asserting completion of CE requirements is subject  
            to a civil action punishable by a fine up to $10,000.  In  
            addition, DCA may suspend the PI's license for up to a year,  
            and revoke the license if the CE requirements remain unmet.   
            Any public prosecutor may bring the civil action.  Requires  
            DCA to advise the applicants of this penalty in the  
            application documents.

          19)Increases the maximum amounts charged for an initial PI  
            license from $175 to $195 and for a PI renewal license from  
            $125 to $145.

           FISCAL EFFECT :  According to the Assembly Appropriations  
          Committee analysis, on-going revenue of approximately $180,000  
          per year due to the increased fees contained in this  
          legislation.  On-going special fund costs to the DCA in excess  
          of $200,000 per year from the Private Investigator Fund for the  
          workload associated with DCA enforcing the provisions of this  
          legislation and maintaining the continuing education program

           COMMENTS  :  According to the author's office, "SB 202 would  
          require licensed investigators to obtain 12 hours of CE every  
          two years.  SB 202 would also increase the biennial licensure  
          fee by $20, an amount necessary to generate $220,000 annually to  
          completely cover the costs of administering the new  
          requirements.  Even though California PIs are licensed and  
          regulated by the state DCA Bureau, there is no current  
          requirement providing the opportunity for investigators to learn  
          of newly-enacted laws, nor is there a compendium of applicable  
          laws for investigators to educate themselves.  Consequently,  
          many of the almost 10,000 licensed investigators may not be  
          aware of the latest developments and legal requirements  
          applicable to the industry."

          Currently, PIs are not required to take any CE as a condition  
          for license renewal, but can elect to take voluntary CE courses  
          offered by associations, businesses, and institutions.   
          Requiring mandatory CE as a condition for license renewal is  
          justified when it is considered necessary in order to maintain a  
          licensee's minimal satisfactory level of competence in his or  
          her occupation.








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          According to the sponsor, the Bureau has the regulatory and  
          enforcement authority provided to it by the Private  
          Investigators Act (Act) in the California Business and  
          Professions Code (BPC).  While many enacted laws relating to  
          privacy protection are contained in other codes, including the  
          Civil Code, the Bureau's authority does not extend to those  
          laws.  The passage of recent legislation to protect personal  
          information, such as restrictions on false impersonation,  
          disclosure of medical records, and disclosure of financial  
          information, are located in codes outside the Act and BPC.  The  
          sponsors claim that the personal privacy laws described are  
          general laws, making it difficult for PIs to track and keep up  
          with new regulations because they are found outside of the Act  
          and BPC.  Therefore, consumer complaints concerning an alleged  
          violation of those laws is neither monitored nor enforced by the  
          Bureau.  Instead, such concerns would be referred to the  
          appropriate regulatory authority, such as the California Office  
          of Information Security and Privacy Protection.   


           Analysis Prepared by  :    Joanna Gin / B. & P. / (916) 319-3301 
                                                                FN: 0002593