BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 262|
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THIRD READING
Bill No: SB 262
Author: Monning (D), et al.
Amended: 4/10/13
Vote: 21
SENATE BUSINESS, PROF. & ECON. DEV. COMM. : 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
SOURCE : Contractors State License Board
DIGEST : This bill 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 State License Law (Contractors Law). This bill
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 more than $5,000, or by
both a fine and imprisonment.
ANALYSIS :
Existing law:
1.Licenses and regulates more than 300,000 contractors under the
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Contractors Law by the Contractors State License Board (CSLB)
within the Department of Consumer Affairs (DCA). The CSLB is
under the direction of the registrar of contractors.
2.Provides that a person may qualify on behalf of an individual
or firm as a partner, responsible managing officer or
responsible managing employee (qualifier). A qualifier is a
person who meets the experience requirement and the
requirement of passing the licensing examination, thereby
meeting the "qualification" for a license to be issued. A
qualifier is responsible for exercising direct supervision and
control of the licensee's construction operation to secure
full compliance with the Contractors Law and the CSLB
regulations.
3.Defines, for purposes of these provisions, "firm" to mean a
partnership, a limited partnership, a corporation, a limited
liability company, or any other combination or organization
described in the Contractors Law, as specified; and "person"
to mean a natural person.
4.Defines "direct supervision and control" to include any one or
any combination of the following activities: supervising
construction, managing construction activities by making
technical and administrative decisions, checking jobs for
proper workmanship, or direct supervision on construction job
sites.
This bill:
1.Requires the person qualifying on behalf of a firm to be
responsible for meeting the requirements of exercising "direct
supervision and control" as defined in CSLB regulations to
secure full compliance with the Contractors Law.
2.Provides that a qualifier's failure to exercise direct
supervision and control shall constitute a cause for
disciplinary action and shall be punishable as a misdemeanor
by imprisonment in the county jail, by a fine of not less than
$3,000, but not more than $5,000, or by both a fine and
imprisonment.
3.Makes technical and conforming changes.
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Background
Under the laws and regulations administered by CSLB, all
contractors must have a person who acts as the qualifier for
licensure. The qualifier is the person who furnishes the
knowledge and experience that is required for licensure and is
responsible for assuring that construction work performed by the
licensee complies with all relevant laws and building codes.
CSLB has determined that a number of qualifiers do not perform
the direct supervision and control duties as required under the
law. Some of them are, in fact, retired licensees who have
"rented" their qualifications for licensure. This has resulted
in a number of cases where construction work has not been
properly completed, causing considerable harm to the consumer.
In order to take action when a qualifier is not fulfilling
his/her duties, the CSLB must prove that the qualifier did not
provide sufficient supervision and control and, in addition,
that a violation of Contractors Law occurred. If successful in
proving the qualifier's failure to comply with his or her
statutory duty, CSLB states that it can take disciplinary action
against the license, but does not have the authority to take any
action directly against the qualifier who has failed to exercise
his/her duties, regardless of the harm to consumers.
Related Legislation
SB 261 (Monning) authorizes the 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.
SB 263 (Monning) clarifies the misdemeanor penalty for a person
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.
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FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 4/22/13)
Contractors State License Board (source)
California Legislative Conference of the Plumbing Heating and
Piping Industry
California Professional Association of Specialty Contractors
California State Association of Electrical Workers
California State Pipe Trades Council
Golden State Builders Exchanges
National Electrical Contractors Association, California Chapters
Northern California Masonry Industry Labor-Management
Cooperation Trust
Northern California Tile Industry Joint Labor-Management
Cooperation Trust
Spa & Pool Industry Education Council
United Contractors
Western States Council of Sheet Metal Workers
ARGUMENTS IN SUPPORT : The bill's sponsor, the Contractors
State License Board, states, "The authority provided by this
bill will enhance consumer protection and ensure that licensees
are fulfilling their supervision requirements."
The Spa & Pool Industry Education Council (SPEC) recognizes that
consumers need to be able to trust the contractor they hire to
do the job properly. According to SPEC, this bill will make
changes to ensure consumer confidence, and the consumer will be
sure that a qualifier is ultimately responsible for job
supervision, managing construction activities, making technical
and administrative decisions, checking jobs for proper
workmanship, and are directly supervising the work site.
The California Professional Association of Specialty Contractors
states that it "opposes those who would abuse the rules
regarding absentee qualifiers of a license. The CSLB has
investigated contractors where the absentee qualifier had no
contact or interaction with the contracting entity. This
practice should be stopped, and SB 262 takes a strong step
forward to curbing these practices."
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MW:ej 4/22/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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