BILL NUMBER: SB 454 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Pavley
FEBRUARY 16, 2011
An act to amend Sections 17203, 17204, and 17206 of, and to add
Section 7110.05 to, the Business and Professions Code, and to amend
Section 399.4 of the Public Utilities Code, relating to the Energy
Commission.
LEGISLATIVE COUNSEL'S DIGEST
SB 454, as introduced, Pavley. Energy efficiency standards: Energy
Commission.
Existing law, the Contractors' State License Law, provides for the
licensure and regulation of contractors by the Contractors' State
License Board. Existing law prohibits certain actions by licensed
contractors and subjects a licensee to discipline for a violation
thereof. Existing law authorizes the board to issue a citation for a
violation of the Contractors' State License Law and to issue civil
penalties. Existing law provides for an Energy Resources Conservation
and Development Commission (Energy Commission) within state
government.
This bill would subject a licensee to discipline for the failure
to comply with specified energy efficiency standards under the
California Code of Regulations. The bill would require the board to
submit an annual report to the Legislature with regard to any civil
penalties assessed against a licensee or unlicensed person for a
violation of those standards. The bill would require the Energy
Commission to collaborate with the board to identify and investigate
the failure of licensees and unlicensed contractors to comply with
those standards.
Existing law defines an act of unfair competition as including an
unlawful, unfair, or fraudulent business act or practice, an unfair,
deceptive, untrue, or misleading advertisement, and other specified
conduct relating to representations made to the public. Existing law
authorizes the Attorney General, certain local prosecutors, a private
plaintiff with an injury-in-fact, or a plaintiff representative who
meets certain standing requirements to bring an action against any
person who engages, has engaged, or proposes to engage in unfair
competition, provides for injunctive relief, and authorizes the court
to make any order or judgment that is necessary to restore to any
person in interest any money or property that may have been acquired
by means of the unfair competition. Civil penalties may also be
collected by the Attorney General and the local prosecutors, as
specified. A portion of the civil penalties collected by the Attorney
General are deposited into the Unfair Competition Law Fund, and,
upon appropriation by the Legislature, are used to support
investigations and prosecutions of consumer protection laws.
The bill would authorize the Energy Commission to bring an action
under the unfair competition laws to enforce any statute or
regulation that the commission is directed to adopt, implement,
administer, or enforce. The bill would authorize the Energy
Commission to collect civil penalties for a violation thereof and,
upon appropriation by the Legislature, would authorize the
expenditure of those moneys by the commission for purposes of
enforcement.
Existing law provides that it is the policy of this state and the
intent of the Legislature that the commission administer
cost-effective energy efficiency programs authorized pursuant to
existing statutory authority. Existing law provides for the
regulation of public utilities under the Public Utilities Act. A
violation of the Public Utilities Act is a crime.
This bill would prohibit a public utility from issuing rebates or
incentives for energy efficiency improvements without the requisite
building permits. Because a violation of this provision would be a
crime under the Public Utilities Act, the bill would impose a
state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. It is the intent of the Legislature to enact
legislation that maximizes the energy saved by the state's various
energy efficiency statutes, regulations, and programs.
SEC. 2. The Legislature finds and declares all of the following:
(a) California's building and appliance energy efficiency
standards, specified in Part 6 of Title 24 of, and Article 4 of
Chapter 4 of Division 2 of Title 20 of, the California Code of
Regulations, respectively, represent a state resource for
accomplishing increased energy efficiency in newly constructed
buildings, additions, and alterations to existing buildings, and in
appliances. These standards are recognized as leading the nation in
energy savings and serving as one of the primary energy policy tools
that has resulted in California's per capita energy use staying
essentially constant over the past 30 years while that of the rest of
the United States increased steadily.
(b) The effectiveness of the building energy efficiency standards
is dependent on the conscientious efforts of licensed contractors in
California to build buildings and install components and equipment in
compliance with the standards.
(c) The Governor and the Legislature recognize that many buildings
are being retrofitted without required permits. Contractors
operating in the underground economy are in flagrant violation of
California contracting law. In particular, these are contractors
operating without a license, and those, whether licensed or not, that
willfully and deliberately fail to obtain a building permit and
willfully and deliberately fail to comply with the building laws and
other laws of the state. Unlicensed and licensed contractors who
market their services with these underground practices engage in
unfair competition, undercutting legitimate contractors who endeavor
to conscientiously comply with contracting, building, and business
laws. This underground activity denies state and local governments
license and building permit revenue, diminishing the ability of state
and local agencies to provide enforcement services intended to
protect consumers by ensuring compliance with these laws. These
practices particularly damage and diminish the potential for
conscientious compliance with the building energy efficiency
standards.
(d) The mission of the Contractors' State License Board is to
protect consumers by regulating contractors to promote the health,
safety, and general welfare of the public in matters related to
construction. As a part of fulfilling this mission, it is important
for the board's licensing program to include efforts to eradicate the
underground practice of performing construction work without
building permits and failing to comply with the building energy
efficiency standards. It has become critically important for the
board to send a strong, definitive message to those whose objective
is illegal financial gain at the expense of safe building practices
and energy efficiency. In particular, the board should not tolerate
illegal practices related to building energy efficiency standards.
(e) The appliance efficiency standards deliver cost-effective
energy savings to consumers. They are an important component of the
state's programs to manage its energy consumption, conserve natural
resources, and improve the quality of life for all its citizens. The
Governor and Legislature recognize that significant quantities of
appliances are sold and offered for sale in California that do not
meet the state's energy efficiency standards. The products needlessly
consume resources and saddle consumers with hidden long-term costs
after the initial purchase.
(f) These violations result in a substantial financial loss to
consumers who purchase energy efficiency goods and services, and
represent unfair competition that dramatically impacts the economic
viability of legitimate businesses. It is critical for California to
maintain a business climate favorable to legitimate competition, so
that conscientious contractors, manufacturers, distributors,
retailers, Home Energy Rating System raters, and other businesses are
able to sustain their businesses against unfair competition.
SEC. 3. Section 7110.05 is added to the Business and Professions
Code, to read:
7110.05. (a) The failure of a licensee to comply with the
building energy efficiency standards specified in Part 6 of Title 24
of the California Code of Regulations constitutes a cause for
disciplinary action.
(b) (1) Beginning with the fiscal year commencing on July 1, 2011,
and each fiscal year thereafter, the board shall compile the
essential data necessary to create a report identifying the number of
civil penalties that the board assessed during the previous fiscal
year against licensees and unlicensed contractors for failure to
comply with the standards described in subdivision (a) of this
section and subdivision (b) of Section 7028.7. This report shall be
submitted to the Legislature no later than the first business day in
October of each year.
(2) The report to be submitted pursuant to this subdivision shall
be submitted in compliance with Section 9795 of the Government Code.
(c) The State Energy Resources Conservation and Development
Commission shall collaborate with the board to identify and
investigate the failure of licensees and unlicensed contractors to
comply with the building energy efficiency standards and to obtain
building permits, and conduct an education and awareness campaign to
increase knowledge of permitting requirements among contractors and
consumers.
SEC. 4. Section 17203 of the Business and Professions Code is
amended to read:
17203. Injunctive Relief--Court Orders
Any person who engages, has engaged, or proposes to engage in
unfair competition may be enjoined in any court of competent
jurisdiction. The court may make such orders or judgments, including
the appointment of a receiver, as may be necessary to prevent the use
or employment by any person of any practice which constitutes unfair
competition, as defined in this chapter, or as may be necessary to
restore to any person in interest any money or property, real or
personal, which may have been acquired by means of such unfair
competition. Any person may pursue representative claims or relief on
behalf of others only if the claimant meets the standing
requirements of Section 17204 and complies with Section 382 of the
Code of Civil Procedure, but these limitations do not apply to claims
brought under this chapter by the Attorney General, or
by any district attorney, county counsel, city
attorney, or city prosecutor in this state , or by the Energy
Resources Conservation and Development Commission to enforce any
statute or regulation that the commission is directed to adopt,
implement, administer, or enforce .
SEC. 5. Section 17204 of the Business and Professions Code is
amended to read:
17204. Actions for Injunctions by Attorney General, District
Attorney, County Counsel, and City Attorneys
, or the Energy Resources Conservation and Development Commission
Actions for relief pursuant to this chapter shall be prosecuted
exclusively in a court of competent jurisdiction by the Attorney
General or a district attorney or by a county counsel authorized by
agreement with the district attorney in actions involving violation
of a county ordinance, or by a city attorney of a city having a
population in excess of 750,000, or by a city attorney in a city and
county or, with the consent of the district attorney, by a city
prosecutor in a city having a full-time city prosecutor in the name
of the people of the State of California upon their own complaint or
upon the complaint of a board, officer, person, corporation, or
association, or by the Energy Resources Conservation and
Development Commission, or by a person who has suffered injury
in fact and has lost money or property as a result of the unfair
competition.
SEC. 6. Section 17206 of the Business and Professions Code is
amended to read:
17206. Civil Penalty for Violation of Chapter
(a) Any person who engages, has engaged, or proposes to engage in
unfair competition shall be liable for a civil penalty not to exceed
two thousand five hundred dollars ($2,500) for each violation, which
shall be assessed and recovered in a civil action brought in the name
of the people of the State of California by the Attorney General, by
any district attorney, by any county counsel authorized by agreement
with the district attorney in actions involving violation of a
county ordinance, by any city attorney of a city having a population
in excess of 750,000, by any city attorney of any city and county,
or, with the consent of the district attorney, by a city prosecutor
in any city having a full-time city prosecutor, or by the Energy
Resources Conservation and Development Commission to enforce any
statute or regulation that the commission is directed to adopt,
implement, administer, or enforce, in any court of competent
jurisdiction.
(b) The court shall impose a civil penalty for each violation of
this chapter. In assessing the amount of the civil penalty, the court
shall consider any one or more of the relevant circumstances
presented by any of the parties to the case, including, but not
limited to, the following: the nature and seriousness of the
misconduct, the number of violations, the persistence of the
misconduct, the length of time over which the misconduct occurred,
the willfulness of the defendant's misconduct, and the defendant's
assets, liabilities, and net worth.
(c) If the action is brought by the Attorney General, one-half of
the penalty collected shall be paid to the treasurer of the county in
which the judgment was entered, and one-half to the General Fund. If
the action is brought by a district attorney or county counsel, the
penalty collected shall be paid to the treasurer of the county in
which the judgment was entered. Except as provided in subdivision
(e), if the action is brought by a city attorney or city prosecutor,
one-half of the penalty collected shall be paid to the treasurer of
the city in which the judgment was entered, and one-half to the
treasurer of the county in which the judgment was entered. The
aforementioned funds shall be for the exclusive use by the Attorney
General, the district attorney, the county counsel, and the city
attorney for the enforcement of consumer protection laws. If the
action is brought by the Energy Resources Conservation and
Development Commission, the penalties collected under this section
, upon appropriation to the commission by the
Legislature, shall be used by the commission to enforce any statute
or regulation that the commission is directed to adopt, implement,
administer, or enforce.
(d) The Unfair Competition Law Fund is hereby created as a special
account within the General Fund in the State Treasury. The portion
of penalties that is payable to the General Fund or to the Treasurer
recovered by the Attorney General from an action or settlement of a
claim made by the Attorney General pursuant to this chapter or
Chapter 1 (commencing with Section 17500) of Part 3 shall be
deposited into this fund. Moneys in this fund, upon appropriation by
the Legislature, shall be used by the Attorney General to support
investigations and prosecutions of California's consumer protection
laws, including implementation of judgments obtained from such
prosecutions or investigations and other activities which are in
furtherance of this chapter or Chapter 1 (commencing with Section
17500) of Part 3.
(e) If the action is brought at the request of a board within the
Department of Consumer Affairs or a local consumer affairs agency,
the court shall determine the reasonable expenses incurred by the
board or local agency in the investigation and prosecution of the
action.
Before any penalty collected is paid out pursuant to subdivision
(c), the amount of any reasonable expenses incurred by the board
shall be paid to the Treasurer for deposit in the special fund of the
board described in Section 205. If the board has no such special
fund, the moneys shall be paid to the Treasurer. The amount of any
reasonable expenses incurred by a local consumer affairs agency shall
be paid to the general fund of the municipality or county that funds
the local agency.
(f) If the action is brought by a city attorney of a city and
county, the entire amount of the penalty collected shall be paid to
the treasurer of the city and county in which the judgment was
entered for the exclusive use by the city attorney for the
enforcement of consumer protection laws. However, if the action is
brought by a city attorney of a city and county for the purposes of
civil enforcement pursuant to Section 17980 of the Health and Safety
Code or Article 3 (commencing with Section 11570) of Chapter 10 of
Division 10 of the Health and Safety Code, either the penalty
collected shall be paid entirely to the treasurer of the city and
county in which the judgment was entered or, upon the request of the
city attorney, the court may order that up to one-half of the
penalty, under court supervision and approval, be paid for the
purpose of restoring, maintaining, or enhancing the premises that
were the subject of the action, and that the balance of the penalty
be paid to the treasurer of the city and county.
SEC. 7. Section 399.4 of the Public Utilities Code is amended to
read:
399.4. (a) (1) In order to ensure that prudent investments in
energy efficiency continue to be made that produce cost-effective
energy savings, reduce customer demand, and contribute to the safe
and reliable operation of the electric distribution grid, it is the
policy of this state and the intent of the Legislature that the
commission shall continue to administer cost-effective energy
efficiency programs authorized pursuant to existing statutory
authority.
(2) As used in this section, the term "energy efficiency"
includes, but is not limited to, cost-effective activities to achieve
peak load reduction that improve end-use efficiency, lower customers'
bills, and reduce system needs.
(b) Any rebates or incentives provided by any public utility for
energy efficiency improvements and installation of energy efficient
components, equipment, or appliances in buildings shall be provided
only if required building permits are obtained.
(b)
(c) The commission, in evaluating energy
efficiency investments under its existing statutory authority, shall
also ensure that local and regional interests, multifamily dwellings,
and energy service industry capabilities are incorporated into
program portfolio design and that local governments, community-based
organizations, and energy efficiency service providers are encouraged
to participate in program implementation where appropriate.
SEC. 8. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.