BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          SB 1243 (Lieu) - Professions and vocations: sunset review.
          
          Amended: April 21, 2014         Policy Vote: BP&ED 9-0
          Urgency: No                     Mandate: No
          Hearing Date: May 23, 2014      Consultant: Mark McKenzie
          
          SUSPENSE FILE.
          
          
          Bill Summary: SB 1243 would extend the sunset of the Veterinary  
          Medical Board (VMB) and the term of its executive officer until  
          January 1, 2017, and extend the sunset of the Certified Common  
          Interest Development Manager (CID manager) program and the Tax  
          Preparer program until January 1, 2019.

          Fiscal Impact: 
              VMB: Projected costs of approximately $4.5 million annually  
              (VMB Contingency Fund), supporting 23.8 PY, until January 1,  
              2017, partially offset by fee revenues of approximately $3.5  
              million, based on the proposed 2014-15 budget.  See staff  
              note below pertaining to discrepancies in budget documents.

              No state costs associated with extending the CID manager  
              and Tax Preparer programs.  The certification of CID  
              managers and registration of tax preparers is handled by a  
              specified professional association of CID managers and a  
              nonprofit regulating entity, respectively, that are outside  
              of state government and are not supported by state funds.

          Background: 
           Veterinary Medical Board
           Existing law provides for the licensing and regulation of  
          approximately 17,000 licensed veterinarians and registered  
          veterinary technicians by the VMB within the Department of  
          Consumer Affairs (DCA).  Existing law establishes a sunset date  
          of January 1, 2016 for the VMB and requires a review of the VMB  
          by the appropriate policy committees of the Legislature prior to  
          that repeal date that is limited to those issues as identified  
          by the respective committees.  The VMB is not required to submit  
          a sunset review document or evaluative questionnaire at that  
          time.  









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          When the VBM was reviewed by the appropriate legislative  
          committees in 2013, concerns were raised about whether the board  
          was taking sufficient and timely actions to address specified  
          issues.   To provide an opportunity for additional review in the  
          short term, the committees determined that a two-year extension  
          of the sunset date was appropriate.  This bill would allow  
          additional time for the VBM to implement regulations and  
          responses for some of the important issues in the near future.

           

          Tax Preparer program
           Existing law establishes the California Tax Education Council  
          (CTEC) as a nonprofit corporation that represents tax preparers  
          in the state.  Existing law also requires tax preparers to  
          register with CTEC, obtain a certificate of completion of  
          specified tax education curriculum, and maintain a surety bond  
          of $5,000 payable to the State of California.  The Tax Preparers  
          program is repealed on January 1, 2015.

           CID managers program
           Existing law establishes the requirements for a voluntary CID  
          manager program that is administered by a professional  
          association of CID managers.  The program specifies the  
          requirements for certification as a CID manager, including 30  
          hours of coursework and an examination on CID law and  
          management.  The CID managers program is repealed on January 1,  
          2015.

          Proposed Law: SB 1243 would the sunset of the Veterinary Medical  
          Board (VMB) and the term of its executive officer until January  
          1, 2017, and extend the sunset of the Certified Common Interest  
          Development Manager (CID manager) program and the Tax Preparer  
          Program until January 1, 2019.

          Related Legislation: This bill is one of six measures introduced  
          this session to extend the sunset on licensing boards within the  
          Department of Consumer Affairs - including SB 1242 (Lieu), SB  
          1244 (Lieu), SB 1245 (Lieu), SB 1246 (Lieu), and SB 1247 (Lieu).

          Staff Comments: 
          The certification of CID managers is performed by a professional  
          association of CID managers, and tax preparers register with  
          CTEC.  Both of these programs are outside of state government,  








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          and no state funds are associated with these voluntary  
          certification and registration programs.

          The Department of Consumer Affairs indicates that the provisions  
          of the bill that extend the sunset on the VMB are minor and  
          absorbable and within existing resources.  Staff notes that,  
          according to the 2014-15 proposed budget, the VMB Contingency  
          Fund, which supports the activities of the VMB, will have  
          expenditures that exceed revenues by over $1 million in the  
          budget year, leaving a reserve of $2.4 million at the end of  
          2014-15.  However, this fund condition statement differs  
          significantly from analyses of the fund condition included in  
          two proposed Budget Change Proposals for VMB augmentations, each  
          of which indicate that the VMB Contingency Fund is in relative  
          balance with a 10-13 month reserve through the extended period  
          of VMB operations.  Staff notes that the actual condition of the  
          fund is uncertain, considering these inconsistencies.