BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Kevin de León, Chair
SB 309 (Price) - State Athletic Commission.
Amended: May 8, 2013 Policy Vote: BP&ED 9-1
Urgency: No Mandate: Yes
Hearing Date: May 13, 2013 Consultant: Mark McKenzie
This bill meets the criteria for referral to the Suspense File.
Bill Summary: SB 309 would extend the sunset of the State
Athletic Commission (Commission) and its executive officer until
January 1, 2016. The bill would also revise the schedule of
fees that support the activities of the Commission and make a
number of other changes to implement recommendations made
through the sunset review process.
Fiscal Impact:
Projected expenditures of $1.125 million (Athletic
Commission Fund) supporting 5.0 PY of staff, offset by $1.39
million in revenues, based on the Governor's proposed
2013-14 Budget. The Commission is currently in an austerity
mode to build a small reserve to remain solvent. These
amounts include a proposed budget reduction of $814,000 and
4.6 PY.
Increased event fee revenues of approximately $184,000
annually (Athletic Commission Fund) as a result of
increasing the minimum fee for amateur events from $500 to
$1,000, establishing a minimum fee of $1,250 for
professional events, and increasing the maximum
broadcasting/TV fee from $25,000 to $35,000 per event.
New revenues of approximately $100,000 annually (Athletic
Commission Fund) related to the replacement of the boxer's
training gymnasium license with a new professional trainer's
licensing program.
New revenues of approximately $4,000 annually (Athletic
Commission Fund) related to the fee charged for issuance of
federal identification cards.
Expenditures of approximately $46,000 annually (State
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Athletic Commission Fund) for .5 PY, Associate Government
Program Analyst, to administer the professional trainer's
licensing program.
No net change in expenditures associated with the changes
to the authorized administrative expenditure cap related to
the Boxer's Pension Fund. This change is intended to
alleviate fluctuations in spending authority.
Background: Existing federal law, The Muhammad Ali Boxing Reform
Act, prohibits events from taking place in a state without a
regulatory commission unless the fight is regulated by either
another state's commission or on sovereign tribal land.
Existing state law, the Boxing Act, or State Athletic Commission
Act, provides for the licensing and regulation of boxers,
kickboxers, martial arts athletes and events held in California
by the California State Athletic Commission within the
Department of Consumer Affairs (DCA), and sunsets the Commission
on January 1, 2014. In 2012, the Commission supervised nearly
200 events, and has supervised over 40 so far in 2013.
The Commission's operating and budgetary deficiencies have been
well-documented in 2011 and 2013 reports by the Bureau of State
Audits, as well as a recent internal audit report by DCA in
March of this year. During the 2011-12 fiscal year, the
Commission neared insolvency, which was only avoided by extreme
cuts that allowed the Commission to end the year with only
$23,000 in reserve. Since that time, the Commission has
developed a plan to remain solvent, and the Governor's 2013-14
proposed budget includes a reduction of $814,000 and 4.6 PY,
which will allow the Commission to build a reserve of 2.9 months
by the end of the budget year, as noted in the fiscal impacts
above. The Assembly and Senate Budget Subcommittees have both
approved the reduction and adopted a supplemental reporting
requirement that requires the Commission to report on: the
number of inspectors in the state and the types of events they
are capable of regulating, the number of Commission staff
required at each event, the amount required to provide training
to athletic inspectors over the last three years, and a
Long-Term Solvency Plan that is due to the Legislature by
February of 2014.
Proposed Law: SB 309 would extend the sunset of the Commission
and its executive officer until January 1, 2016, and would make
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a number of other changes to implement recommendations made
through the sunset review process, including the following:
Replace a professional boxer's training gymnasium
licensing program with a professional trainer's licensing
program, as specified. The bill specifies an application
and renewal fee of $200.
Require the Commission to charge a $20 fee to issue
federal identification cards.
Increase the minimum fee for an amateur event from $500
to $1,000.
Establish a minimum fee of $1,250 for a professional
event.
Increase the maximum broadcasting/TV fee from $25,000 to
$35,000.
Limit the administrative costs associated with the
Neurological Examination Account to 20% of the prior year's
contributions.
Authorize the Commission to use funds from the
Neurological Examination Account to fund specified
neurological examinations and diagnostic imaging and
testing.
Revise the limits for administrative costs associated
with investing, managing, and distributing the Boxer's
Pension Fund from 20% of the average contributions over the
previous two years to no more than 2% of the corpus of the
fund.
Related Legislation: This bill is one of several bills
introduced this session to extend the sunset on licensing boards
within the Department of Consumer Affairs - including SB 305
(Price), SB 306 (Price), SB 307 (Price), SB 308 (Price), and SB
309 (Price).
Staff Comments: The fee increases specified in the bill are
intended to provide the Commission with an appropriate level of
funding to achieve solvency and perform its mission of proper
regulation of events in California.
DCA estimates that the establishment of a professional trainer's
licensing program would generate approximately $100,000 in new
fee revenues annually to license approximately 500 persons.
Although the bill doesn't currently specify that license renewal
would be annual, staff assumes that is the intent (see
recommended amendment below for clarification). Administration
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of this program would require approximately 0.5 PY of new staff
at a cost of approximately $46,000 annually.
The costs associated with issuance of federal identification
cards have been absorbed by the Commission since 1996. This
bill would establish a fee of $20 for issuance of the cards,
which is expected to generate minor revenues of approximately
$4,000 annually.
Based upon the number of events in 2011-12, the revisions to the
event fees are expected to generate approximately $184,000
annually.
As a result of the new licensing program, federal identification
card fees, and increases to the event and broadcasting fees, the
net impact of this bill would be an increase in revenues of
approximately $242,000 annually to the Athletic Commission Fund.
Recommended Amendments: The bill should be amended to clarify
that the $200 professional trainer's license fee should be
charged on an initial application for licensure and annual
renewals.