BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 261|
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THIRD READING
Bill No: SB 261
Author: Monning (D), et al.
Amended: As introduced
Vote: 21
SENATE BUS., PROF. & ECON. DEVELOPMENT COMMITTEE : 10-0, 4/8/13
AYES: Price, Emmerson, Block, Corbett, Galgiani, Hernandez,
Hill, Padilla, Wyland, Yee
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Contractors: fraudulent use of license
SOURCE : Contractors State License Board
DIGEST : This bill authorizes the Contractors State License
Board (CSLB) to take administrative action against a licensed or
unlicensed person who misuses or misrepresents a contractor
license or aids and abets another person to do so.
ANALYSIS :
Existing law:
1. Provides for the licensing and regulation of more than 100
business and 200 professional categories and various
professions by some 23 boards, six bureaus, four committees,
two programs and one commission in the Department of Consumer
Affairs (DCA) under various licensing acts within the
Business and Professions Code (BPC).
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2. General provisions of BPC Section 119 makes it a misdemeanor
(crime) for any person to:
A. Display, permit to be displayed or have in his/her
possession, a cancelled, revoked, suspended or altered
license or a fictitious license or document simulating a
license.
B. Lend or knowingly permit his/her license to be used by
another.
C. Display or represent any license not issued to him/her
as being his/her license.
D. Fail or refuse to surrender to the issuing board or
bureau, upon a lawful written demand, any license,
registration, permit, or certificate which has been
suspended, revoked, or canceled.
E. Knowingly permit an unlawful use of a license issued to
him/her.
F. Photograph, duplicate, manufacture, or in any way
reproduce a license in a manner that it could be mistaken
for a valid license, or display or have in their
possession a photograph duplicate, reproduction, or copy
unless authorized by the BPC.
G. Buy or receive a knowingly fraudulent, forged, or
counterfeit license.
3. Licenses and regulates more than 300,000 contractors under
the Contractors State License Law (Contractors Law) by the
CSLB within the DCA. The CSLB is under the direction of the
registrar of contractors (Registrar).
4. Authorizes the Registrar to issue a citation, instead of
initiating disciplinary proceedings, to a licensee when there
is probable cause to believe that the licensee has committed
acts in violation of the Contractors Law. The citation may
include an order for payment by a licensee of a specified sum
to an injured party.
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5. Establishes grounds for disciplinary action for a licensed
contractor to aid or abet an unlicensed person to evade the
Contractors Law, or to allow an unlicensed person to use
his/her license, or to act in the capacity of a contractor
under an inactive or suspended license.
6. Establishes grounds for disciplinary action for a person to
act in the capacity of a contractor under an inactive or
suspended license.
7. Provides that any person who willfully and intentionally
uses, with intent to defraud, a contractor license number
that does not correspond to the number on a currently valid
contractor's license held by that person, is punishable by a
fine of up to $10,000 or by imprisonment of up to one year,
or by both fine and imprisonment.
8. Authorizes the Registrar to issue a citation which may
include an order of abatement and a civil penalty to an
unlicensed individual acting as a licensed contractor.
This bill:
1. Provides, under the Contractor Law, that any licensed or
unlicensed person who commits any violation of BPC Section
119 with respect to a contractor license is subject to the
administrative remedies authorized by the Contractors Law.
2. Provides that, unless otherwise expressly provided, the
administrative remedies shall be separate from, and in
addition to, all other available civil or criminal remedies.
Related Legislation
SB 262 (Monning) requires the person qualifying on behalf of a
contracting firm to be responsible for exercising direct
supervision and control in order to secure full compliance with
the Contractors Law. Provides that failure to exercise direct
supervision and control shall constitute a cause for
disciplinary action and shall be punishable as a misdemeanor by
imprisonment in county jail, by a fine of not less than $3,000,
but not to more than $5,000, or by both a fine and imprisonment.
SB 263 (Monning) clarifies the misdemeanor penalty for a person
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engaging in the business or acting in the capacity of a
contractor to also include a person who has never been a
licensed contractor, or a person who was licensed but who acts
under a license that is inactive, expired, revoked, or under
suspension for any reason. Provides that a contractor may
pursue payment for any work on the contract while duly licensed,
but precludes payment for work performed in a classification in
which the contractor was not licensed, or was under license
suspension, or under an expired or inactive license when the
work was performed.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (Verified 4/18/13)
Contractors State License Board (source)
Air Conditioning Trade Association
American Subcontractors Association of California
California Landscape Contractors Association
California Legislative Conference of the Plumbing, Heating and
Piping Industry
California Professional Association of Specialty Contractors
California State Association of Electrical Workers
California State Council of Laborers
California State Pipe Trades Council
Construction Employers Association
Golden State Builders Exchanges
National Electrical Contractors Association, California Chapter
Northern California Masonry Industry, Joint Labor-Management
Cooperation Trust
Northern California Tile Industry, Joint Labor-Management
Cooperation Trust
Plumbing-Heating-Cooling Contractors Association of California
Spa & Pool Industry Education Council
United Contractors
Western Electrical Contractors Association
Western States Council of Sheet Metal Workers
ARGUMENTS IN SUPPORT : According to the author's office, this
bill authorizes CSLB to take administrative action for
violations of BPC Section 119 which allows CSLB to issue
administrative citations whether or not these violations are
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pursued by a district attorney, thereby enabling the CSLB to
establish a relevant record against licensees and non-licensees.
The California State Council of Laborers states that this bill
adds to the enforcement tool box a mechanism to ensure fair and
safe working conditions are in place in all California
workplaces and levels the playing field for employers through
the enforcement of state laws.
The Spa & Pool Industry Education Council (SPEC) states that
contractors who are not licensed routinely go under-ground to
work on a cash basis, and thus break laws. SPEC believes that
individuals who commit violations listed in BPC Section 119 are
a risk to the public and legitimate licensees and states that
this bill will ensure that the CSLB has the authority to issue
citations to these individuals.
The Western Electrical Contractors Association, Air Conditioning
Trade Association, and Plumbing-Heating-Cooling Contractors
Association of California supports this bill, writing that
making licensed or unlicensed persons subject to administrative
remedies for the improper use of a license would allow the CSLB
to take administrative action for these types of violations and
thus establish a relevant record against such violators.
The California Professional Association of Specialty Contractors
states that its contractor members and the public have been
victimized by persons who fraudulently use license numbers and
other contractor information and that this bill strengthens the
ability of California to penalize these fraudulent parties.
MW:d 4/24/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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