BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 706|
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THIRD READING
Bill No: SB 706
Author: Price (D)
Amended: 5/31/11
Vote: 21
SENATE BUS., PROF. & ECON. DEVEL. COMMITTEE : 7-2, 5/2/11
AYES: Price, Emmerson, Corbett, Correa, Hernandez, Negrete
McLeod, Vargas
NOES: Walters, Wyland
SENATE APPROPRIATIONS COMMITTEE : 6-2, 5/26/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Runner
NO VOTE RECORDED: Emmerson
SUBJECT : Business and Professions
SOURCE : Author
DIGEST : This bill makes numerous enforcement
enhancements to the Department of Real Estate (DRE) and the
Office of Real Estate Appraisers (OREA); requires licensing
boards to post information about licensees on the Internet,
as specified; and makes updating and conforming changes.
ANALYSIS :
Existing law :
1. Provides for the licensure, and regulation of more than
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483,000 real estate brokers, real estate salespersons,
and more than 22,000 mortgage loan originator license
endorsements by DRE in the Business, Transportation and
Housing Agency (BT&H). The Real Estate Commissioner
(Commissioner), who serves as the chief executive of the
Department, is appointed by the Governor, subject to
Senate confirmation. The Commissioner is mandated to
enforce the Real Estate Law.
2. Provides for the licensure and regulation of more than
13,800 real estate appraisers, and the certification of
more than 200 appraisal management companies (AMCs) by
OREA within BT&H. The Director of OREA (Director)
serves as the chief executive of OREA, and is appointed
by the Governor, subject to Senate confirmation. The
Director is mandated to enforce the Real Estate
Appraisers Licensing and Certification Law.
3. Requires specified boards within the Department of
Consumer Affairs (DCA) to disclose on the Internet
information on their respective licensees, including
information on the status of every license, suspensions
and revocations of licenses issued and other related
enforcement actions.
This bill:
1. States that protection of the public shall be the
highest priority for DRE and OREA in exercising their
licensing, regulatory, and disciplinary functions and
that whenever the protection of the public is
inconsistent with other interests sought to be promoted,
the protection of the public shall be paramount.
2. Allows DRE and OREA to enter into a settlement with a
licensee or applicant instead of the issuance of an
accusation or statement of issues against that licensee
or applicant. Requires the settlement to identify the
factual basis for the action being taken and the
statutes or regulations violated. Specifies that a
person who enters a settlement is not precluded from
filing a petition, in the timeframe permitted by law, to
modify the terms of the settlement or petition for early
termination of probation, if probation is part of the
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settlement. States that any settlement executed against
a licensee shall be considered discipline, by the
Department.
3. Authorizes an administrative law judge to order a
licensee in a disciplinary proceeding to pay, upon
request of the Commissioner or Director, the reasonable
costs of investigation and enforcement of the
disciplinary case against the licensee (cost recovery).
4. When a licensee is placed on probation, authorizes the
Commissioner or Director to, in addition to any other
terms and conditions placed upon the licensee, require
the licensee to pay the monetary costs associated with
monitoring the licensee's probation.
5. Requires costs recovered pursuant to these disciplinary
proceedings to be deposited in either the Real Estate
Fund or the Real Estate Appraisers Regulation Fund, as
specified, and makes the funds available upon
appropriation by the Legislature.
6. Requires the automatic suspension of any licensee who is
incarcerated after conviction of a felony, regardless of
whether the conviction has been appealed. Requires the
DRE or OREA to notify the licensee in writing of the
suspension and of his or her right to elect to have the
issue of penalty heard, as specified.
7. Requires a licensee to submit a written report of any of
the following to the DRE or OREA: The bringing of an
indictment or information charging a felony against the
licensee; arrest of the licensee; conviction of the
licensee, including any felony or misdemeanor; and, any
disciplinary action taken by another licensing entity or
authority of this state or of another state. Requires
the report to be made in writing within 30 days; and
that failure to make a report shall constitute a cause
for discipline.
8. Requires the Secretary of BT&H, by January 31, 2012, to
appoint a DRE Enforcement Program Monitor (Monitor),
whose duties include:
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A. Monitor and evaluate DRE's disciplinary system and
procedures and report his or her findings, as
specified, to the DRE and the Legislature no later
than August 1, 2012 and every six months thereafter,
as specified.
B. Make his or her reports available to the public
and to the media.
9. Sunsets the provisions relating to the Monitor on
January 31, 2014.
10.Provides the following regarding posting information
about licensees on the internet pursuant to BPC Section
27:
A. Requires the posted information to include:
suspensions, revocations, and other related
enforcement action, including accusations filed
pursuant to the Administrative Procedures Act.
B. Deletes certain healing arts boards within DCA
from the requirements to post licensee information in
the Internet.
C. Additionally requires the following to post
information on the Internet:
(1) The Board of Accountancy.
(2) The Architects Board.
(3) The State Athletic Commission.
(4) The State Board of Barbering and
Cosmetology.
(5) The State Board of Guide Dogs for the Blind.
(6) The State Board of Chiropractic Examiners.
(7) The Department of Real Estate.
(8) The Office of Real Estate Appraisers.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
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Major Provisions 2011-12 2012-13
2013-14 Fund
DRE oversight ----approximately
$1,000 annually Special*
potentially offset by fees-----
DRE enforcement monitor $83 $166
$166 Special*
DRE admin $144
$288 $288 Special*
OREA admin $170
$339 $339 Special**
Revenue unknown revenue
from Special**
reimbursement from licensees for
investigations
Court administration approximately $1,000
annually General
Advisory commission $20
$40 $40 Special*
* Real Estate Fund
**Real Estate Appraisers Fund
JJA:do 5/31/11 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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