BILL ANALYSIS                                                                                                                                                                                                    Ó



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          ASSEMBLY THIRD READING
          AB 865 (Eggman)
          As Amended  April 24, 2013
          Majority vote 

           WATER, PARKS & WILDLIFE      10-4                    
          APPROPRIATIONS      12-5        
           
           ----------------------------------------------------------------- 
          |Ayes:|Rendon, Blumenfield,      |Ayes:|Gatto, Bocanegra,         |
          |     |Bocanegra, Fong, Frazier, |     |Bradford,                 |
          |     |Gatto, Gomez, Gray,       |     |Ian Calderon, Campos,     |
          |     |Yamada, Bloom             |     |Eggman, Gomez, Hall,      |
          |     |                          |     |Rendon, Pan, Quirk, Weber |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Bigelow, Allen, Beth      |Nays:|Harkey, Bigelow,          |
          |     |Gaines, Patterson         |     |Donnelly, Linder, Wagner  |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Allows the Department of Boating and Waterways (DBW)  
          to set licensing fees for brokers and salespersons of ships and  
          yachts through regulation.  Specifically,  this bill  :  

          1)Amends existing law requiring DBW to issue an annual list of  
            licensed brokers and salespersons of ships and yachts, and  
            requires DBW to instead post this directory on its Internet  
            Web site.

          2)Repeals requirement for DBW to detail its activities regarding  
            the brokerage and sales of ships and yachts as part of a  
            biennial report. 

          3)Repeals the fee schedule set by statute for brokers and  
            salespersons of ships and yachts.

          4)Requires DBW to set by regulation a new fee schedule for  
            brokers and salespersons of ships and yachts.  Provides that  
            the current statutory fees shall apply until such time as DBW  
            adopts the new fees by regulations.

          5)Requires DBW to adopt rules and regulations to carry out  
            provisions of existing law regarding for-hire vessel  
            operators, including adopting a fee schedule for examinations,  








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            licensing, renewals, and other services. 

           EXISTING LAW  :

          1)Establishes DBW in the Natural Resources Agency and charges  
            DBW with duties related to beach erosion, harbors, and  
            recreational boating and boat trails.  Establishes the Boating  
            and Waterways Commission, which provides advice to DBW on  
            matters within DBW's jurisdiction and approves certain  
            transfers, loans, and grants proposed by DBW.

          2)Requires DBW to publish an annual directory of licensed  
            brokers and salespersons of ships and yachts.  Permits DBW to  
            issue a periodical bulletin concerning brokerage and sale of  
            yachts and ships.

          3)Requires DBW to publish a full and accurate account of its  
            activities regarding brokerage and sales of ships and yachts,  
            including all receipts and expenditures during the preceding  
            two years, and requires this account is to be included in a  
            biennial report prepared pursuant to a section of the Harbors  
            and Navigation Code that has been repealed.  

          4)Establishes by statute a fee schedule for the licensing of  
            brokers and salespersons of ships or yachts.  Requires a  
            criminal records investigation fee, as set by the Department  
            of Justice, for license applicants. 

          5)Grants authority to DBW to establish rules and regulations  
            necessary to carry out provisions of law regarding the  
            licensing of for-hire vessel operators.

          6)Transfers DBW to the Department of Parks and Recreation (DPR)  
            as the Division of Boating and Waterways, pursuant to the  
            Governor's Reorganization Plan No. 2, effective July 3, 2012,  
            and operative July 1, 2013.

           FISCAL EFFECT  :  According to the Assembly Appropriations  
          Committee, potential increased annual fee revenue (Harbors and  
          Watercraft Revolving Fund) estimated to be in the range of  
          $85,000- $350,000, depending on the rulemaking outcome.  Minor  
          and absorbable costs for rulemaking to establish new fee  
          schedule









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           COMMENTS  :  This bill authorizes DBW to establish license fees  
          for brokers and salespersons of yachts and ships by regulation.   
          The regulatory fee schedule would replace the statutory license  
          fees currently in effect.  This bill provides that the existing  
          statutory license fees would remain in effect until the  
          regulations establishing the new fee schedule are adopted.  This  
          bill also removes an obsolete provision requiring DBW to include  
          certain accounting information in a biennial report that is no  
          longer required by law.  The provision of the Harbors and  
          Navigation Code that previously required DBW to make a biennial  
          report to the Boating and Waterways Commission, the Legislature  
          and the Governor covering DBW's operations was repealed in the  
          2011-12 Session.  

          The author of this bill notes that the current license fees date  
          back to 1990 and are much lower than contemporary fees for  
          comparable industries.  The author also notes that the current  
          revenues from the licensing program for yacht and boat brokers  
          and salespersons are not sufficient to self-fund the program.   
          Finally, the author states that an amendment to the statute  
          allowing DBW to adopt rules and regulations regarding for-profit  
          vessel operators is needed because DBW does not currently have  
          explicit authority to establish fees for its related services.

          As noted above, the Governor's Reorganization Plan No. 2, which  
          goes into effect on July 1, 2013, eliminates the DBW and  
          transfers the functions of the DBW to a new Division of Boating  
          and Waterways within DPR.  The Division of Boating and Waterways  
          will be the successor agency to DBW and assume additional  
          specified powers, functions, and jurisdiction from the following  
          state agencies:

          1)All of the powers, functions, and jurisdiction previously  
            vested in the Division of Small Craft Harbors of DPR.

          2)All of the powers, functions, and jurisdiction of the State  
            Lands Commission with respect to the acquisition,  
            construction, development, improvement, maintenance, and  
            operation of small craft harbors.

          3)All of the powers, functions, and jurisdiction of DPR with  
            respect to boating facility planning, design and construction,  
            except as specifically provided in the California Recreational  
            Trails Act for boating trails.








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          4)All of the powers, functions, and jurisdiction of the Office  
            of Architecture and Construction in the Department of General  
            Services with respect to boating facility planning and design.

          5)All of the powers, functions, and jurisdiction of the  
            Department of Water Resources with respect to beach erosion  
            control.

          Under the Governor's Reorganization Plan No. 2 as introduced,  
          the Division of Boating and Waterways would also have absorbed  
          the regulatory powers, functions, and jurisdiction of the  
          Boating and Waterways Commission.  However, AB 737 (Buchanan),  
          Chapter 136, Statutes of 2012, retained the Boating and  
          Waterways Commission within the new Division of Boating and  
          Waterways.  AB 737 repealed Chapter 3 of the Harbors and  
          Navigation Code relating to the Commission and added a new  
          Chapter 3 prescribing the membership, functions, and duties of  
          the Commission.

          Other related legislation includes AB 1317 (Frazier) of this  
          session, which would enact the statutory changes necessary to  
          reflect the changes in law made by the Governor's Reorganization  
          Plan No. 2, and would also make additional changes to properly  
          reflect the assignment and reorganization of the various  
          functions of state government.  

          Supporters of this bill include organizations involved in many  
          aspects of boating in California.  The California Yacht Brokers  
          Association, which represents the brokers who would be subject  
          to the licensing fees at issue in this bill, approves allowing  
          DBW to set licensing fees by regulation at levels appropriate to  
          protect consumers and to ensure the ongoing professionalism of  
          the yacht brokering and sales industry.


           Analysis Prepared by  :    Diane Colborn/ W., P. & W. / (916)  
          319-2096


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