BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 865 (Eggman) - Yacht and Ship Brokers Act: licensing. Amended: April 24, 2013 Policy Vote: NR&W 7-2 Urgency: No Mandate: No Hearing Date: August 12, 2013 Consultant: Marie Liu This bill does not meet the criteria for referral to the Suspense File. Bill Summary: AB 865 would allow the Department of Boating and Waterways (DBW) to establish fees for exams, licensing, renewals, and other services provided by DBW for for-hire vessels and to establish fees for salesperson's and broker's license. Fiscal Impact: Minor and absorbable costs to the Harbors and Watercraft Revolving Fund (special) to adopt regulations to establish fees. On-going increased revenues, likely between $85,000 and $350,000 to the Harbors and Watercraft Revolving Fund from increased fees. Background: Under the Yacht and Ship Brokers Act (Harbors and Navigation Code §700 et seq.), a license from DBW is required to sell or rent boats that are more than 16 feet long but less than 300 gross tons. There are various requirements for licensure including bonding, passing an examination, and undergoing a criminal records investigation. DBW annually publishes a list of licensed brokers and salespeople. DBW is required to investigate written complaints against brokers and salespersons. Existing law specifies license fees for broker's and salesperson's licenses, renewals, license transfers, and exams. Proposed Law: This bill would allow DBW to establish reasonable fees for exams, licensing, renewals, and other services regarding for-hire vessels and licensure of brokers and salespersons. This bill would specify that the existing statutorily set fees would continue until DBW establishes AB 865 (Eggman) Page 1 regulations to establish those fees. Staff Comments: DBW, now the Division of Boating and Waterways, intends on establishing fees that would fully cover the costs of operating the program in approximately one year, should this bill become law. According to DBW, the cost of adopting the regulations will be minor and absorbable and will result in increased annual revenues between $85,000 and $350,000. The bill also requires DBW to collect a criminal records investigation fee for a salesperson's and broker's license in an amount determined by the Department of Justice. This fee is already determined by the Department of Justice and therefore this provision does not have any cost implications. Recommended Amendments: This bill requires that the regulations establish "reasonable" fees. However, reasonable fees do not necessarily mean sufficient to cover DBW's cost. Staff recommends that the bill specify that the fee schedule should be sufficient to cover DBW's cost in implementing the programs, which is consistent with DBW's intent. As of July 1, 2013, DBW is now the Division of Boating and Waterways in the Department of Parks and Recreation. This bill should be amended to reflect this reorganization.