BILL NUMBER: SB 454 AMENDED
BILL TEXT
AMENDED IN SENATE MARCH 29, 2011
INTRODUCED BY Senator Pavley
FEBRUARY 16, 2011
An act to amend Sections 17203, 17204, and 17206 of, and
to add An act to add Section 7110.05 to
, the Business and Professions Code, to amend
Section 25900 of, and to add Section 25402.11 to, the Public
Resources Code, and to amend Section 399.4 of the Public
Utilities Code, relating to the Energy Commission
energy .
LEGISLATIVE COUNSEL'S DIGEST
SB 454, as amended, Pavley. Energy efficiency standards:
Energy Commission. enforcement.
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.
(1) Existing law establishes the State Energy Resources
Conservation and Development Commission and vests with the commission
jurisdiction over specified matters related to energy. Existing law
requires the Attorney General, upon the request of the commission, to
petition a court of competent jurisdiction to enjoin violations of
law that is within the subject matter of the commission. Existing law
requires the commission to prescribe, by regulation, building design
and construction standards, energy and water efficiency design
standards for new residential and nonresidential buildings, and
appliance efficiency standards.
This bill would authorize the commission to petition a court of
competent jurisdiction to enjoin a violation of the above standards.
The bill would authorize the commission to establish an
administrative enforcement process to enforce the above standards.
The bill would provide for the assessment of civil penalties by the
courts or administrative civil penalties by the commission for a
violation of the above standards.
This bill would require the commission and the Contractors' State
License Board to collaborate to identify and investigate the failure
of licensed and unlicensed contractors to comply with the above
standards and to obtain the necessary building permits, and to
conduct an education and awareness campaign for contractors and
consumers regarding the permitting requirements.
Existing
(2) 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
(3) 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 by nearly 50 percent
.
(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 by unlicensed contractors and
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. efficiency standards.
(e) The State Energy Resources Conservation and Development
Commission is responsible for establishing energy efficiency building
codes and appliance standards in California. As such, that
commission has expertise in how to raise awareness and enforce these
standards. It has become critically important for that commission and
the Contractors' State License Board to ensure that all buildings
and appliances meet California's efficiency standards and send a
strong, definitive message to those whose objective is illegal
financial gain at the expense of safe building practices and energy
efficiency.
(e)
(f) 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. Furthermore,
inadequate certification of appliances sold in California undermines
the state's ability to ensure that products sold in California meet
the state's efficiency standards.
(f)
(g) 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
7110.05. The State Energy Resources Conservation
and Development Commission and the board shall collaborate 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, 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, 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. 4. Section 25402.11 is added to the
Public Resources Code , to read:
25402.11. (a) If the commission finds that a violation of the
regulations adopted pursuant to subdivision (a) or (b) of Section
25402 and approved by the State Building Standards Commission
pursuant to Section 25402.2, or a violation of the regulations
adopted pursuant to subdivision (c) of Section 25402, has occurred or
is threatening to occur, the commission may, or the Attorney General
upon the request of the commission shall, petition a court to enjoin
the violation. The court may grant prohibitory or mandatory
injunctive relief as warranted by way of temporary restraining order,
preliminary injunction, and permanent injunction, and may assess a
civil penalty pursuant to subdivision (b).
(b) (1) A person who violates a regulation adopted pursuant to
subdivision (a) or (b) of Section 25402 and approved by the State
Building Standards Commission pursuant to Section 25402.2, or
violates the regulations adopted pursuant to subdivision (c) of
Section 25402, shall be liable for a civil penalty not to exceed two
thousand five hundred dollars ($2,500) for each violation.
(2) For the purposes of this section, a person who performs work
that is subject to the regulations adopted pursuant to subdivision
(a) or (b) of Section 25402 and who is an unlicensed contractor or
who fails to obtain the required permit is deemed to be in violation.
(c) For a person found to be in violation pursuant to subdivision
(b), the court shall impose a civil penalty pursuant to subdivision
(b). In assessing the amount of the civil penalty, the court shall
consider all of the following factors:
(1) The nature and seriousness of the misconduct.
(2) The number of violations.
(3) The persistence of the misconduct.
(4) The length of time over which the misconduct occurred.
(5) The willfulness of the defendant's misconduct.
(6) The defendant's assets, liabilities, and net worth.
(d) (1) Civil penalties collected pursuant to this section in a
civil action brought by the Attorney General shall be deposited into
the General Fund.
(2) Civil penalties collected pursuant to this section in a civil
action brought by the commission shall be deposited into the Energy
Resources Program Account and, upon appropriation by the Legislature,
shall be expended by the commission for the education of the public
on building and appliance energy efficiency and for the enforcement
of regulations adopted pursuant to Section 25402.
(3) In a civil action brought by the commission pursuant to this
section, upon the granting of relief, the court shall award to the
commission the reasonable costs incurred by the commission in
investigating and prosecuting the action.
(e) The commission may adopt regulations establishing an
administrative enforcement process for a violation of a regulation
adopted pursuant to subdivision (a) or (b) of Section 25402 and
approved by the State Building Standards Commission pursuant to
Section 25402.2 or a regulation adopted pursuant to subdivision (c)
of Section 25402. The enforcement process shall be a public process
under which the commission may issue a notice of violation and
correction, and for the assessment of administrative civil penalties
up to the amounts specified in subdivision (b) considering the
factors specified in subdivision (c).
(f) An order imposing an administrative civil penalty shall be
subject to judicial review pursuant to subdivisions (a) and (b) of
Section 25534.2.
(g) A person shall not be liable for a civil penalty pursuant to
subdivision (b) if that person is subject to an administrative civil
penalty pursuant to subdivision (e).
SEC. 5. Section 25900 of the Public
Resources Code is amended to read:
25900. Except as provided in Section
Sections 25402.11 and 25531, whenever
if the commission finds that any provision of this division is
violated or a violation is threatening to take place which
that constitutes an emergency requiring
immediate action to protect the public health, welfare, or safety,
the Attorney General, upon request of the commission, shall petition
a court to enjoin such the violation.
The court shall have jurisdiction to may
grant such prohibitory or mandatory
injunctive relief as may be warranted by way of
temporary restraining order, preliminary injunction, and permanent
injunction.
SEC. 7. SEC. 6. 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.
(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. SEC. 7. 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.