BILL ANALYSIS Ó
AB 278
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ASSEMBLY THIRD READING
AB 278 (Hill)
As Introduced February 8, 2011
Majority vote
BUSINESS & PROFESSIONS 9-0
APPROPRIATIONS 17-0
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|Ayes:|Hayashi, Bill Berryhill, |Ayes:|Fuentes, Harkey, |
| |Allen, Butler, Eng, | |Blumenfield, Bradford, |
| |Hagman, Hill, Ma, Smyth | |Charles Calderon, Campos, |
| | | |Davis, Donnelly, Gatto, |
| | | |Hall, Hill, Lara, |
| | | |Mitchell, Nielsen, Smyth, |
| | | |Solorio, Wagner |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Authorizes the Real Estate Commissioner (Commissioner)
to adopt regulations for issuing citations to those who violate
the Real Estate Law or any regulation under that law.
Specifically, this bill :
1)Authorizes the Commissioner to adopt regulations that
establish a system for issuing citations to licensees in
violation of the Real Estate Law or any regulation adopted
under that law, and to issue such citations except where
violations have resulted in serious financial loss to a member
of the public. A citation may contain an order of abatement
or an order to pay an administrative fine.
2)Requires the system for issuing citations to satisfy the
following conditions:
a) Citations shall be in writing and describe the nature of
the violation, including reference to the provision of law
that was violated;
b) Citations shall, when appropriate, contain an order of
abatement fixing a reasonable time for abatement;
c) Administrative fines must not exceed $1,000 for each
inspection or each investigation made with respect to the
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violation. The Commissioner must consider several factors
in assessing a fine, as specified;
d) Citations or fine assessments must inform licensees of
the appeals process for contested violations, which
provides for a hearing within 30 days of the date the fine
or assessment is issued. Payment of a fine shall not
constitute an admission of the violation charged and shall
not be reported in the Department of Real Estate's (DRE)
real estate bulletin; and,
e) The Commissioner may take disciplinary action if a
licensee fails to pay a fine within 30 days of the
assessment date, unless the citation is being appealed. If
a citation is not contested and a fine is not paid, the
fine shall be added to the license renewal fee. A license
shall not be renewed without payment of the renewal fee and
fine.
3)Allows the following: citations to be issued without the
assessment of an administrative fine; a fine assessment to be
limited to particular violations of the Real Estate Law; and,
notice to be given to a broker when a citation is issued to a
salesperson or broker associate employed by the broker.
4)Specifies that, if a fine is paid to satisfy an assessment
based on the finding of a violation, payment of the fine shall
be represented as satisfactory resolution of the matter for
purposes of public disclosure.
5)Requires administrative fines to be credited to the Recovery
Account of the Real Estate Fund and, upon legislative
appropriation, to be available for expenditure under the Real
Estate Recovery Program.
6)Specifies that the establishment of an administrative citation
system does not preclude the use of other disciplinary
authority of the Commissioner.
7)Allows the Commissioner to adopt regulations to establish a
similar administrative citation system for unlicensed persons
acting in the capacity of a licensee, as specified.
FISCAL EFFECT : According to the Assembly Appropriations
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Committee:
1)DRE takes approximately 1,000 disciplinary actions per fiscal
year. If 10% of those actions result in a citation and/or
fine at the proposed maximum of $1,000 each it would result in
approximately $100,000 in additional revenue for the Recovery
Account in the Real Estate Fund.
2)Workload associated with promulgating the required regulations
and establishing the new citations process would be minor and
absorbable within existing resources.
COMMENTS : According to the author, "While the Real Estate
Commissioner has authority to enforce real estate law, he or she
has a relatively narrow number of options for imposing
discipline and penalties. AB 278 would allow for the issuance
of a citation and a fine for relatively minor violations that
have not resulted in harm to the public. AB 278 would provide a
type of "fix-it ticket" that could be levied without the
necessity of a long drawn out hearing and review process. While
certainly appropriate for more serious violations, such a time
consuming process does not serve either the general public or
the regulated community in the most efficient manner in all
cases."
This bill grants the Commissioner the authority to adopt
regulations to issue citations for violations of Real Estate Law
that might not warrant a full investigation or the imposition of
remedies under current law, such as suspending or revoking a
license. Citations can include an order of abatement or a fine
of up to $1,000, which would be deposited into the Recovery
Account and subject to legislative appropriation. Citations
must notify the licensee of DRE's appeals process and, if a
licensee pays a fine, the underlying citation will not be
reported in DRE's Real Estate Bulletin. A similar citation
system can be adopted for unlicensed persons acting in the
capacity of a licensee.
Analysis Prepared by : Angela Mapp / B.,P. & C.P. / (916)
319-3301 FN:
0000728
AB 278
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