BILL ANALYSIS                                                                                                                                                                                                    

                                                                  SB 1243
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          Date of Hearing:   August 6, 2014

                                  Mike Gatto, Chair

                     SB 1243 (Lieu) - As Amended:  June 30, 2014 

          Policy Committee:                             Business and  
          Professions  Vote:                            13 - 0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              


          This bill is one of several sunset extension bills introduced  
          this session and enacts a wide variety of non-controversial  
          reforms to address issues raised during the 2014 sunset review  
          process.  Specifically, this bill:

          1)Allows agencies within the Department of Consumer Affairs  
            (DCA) that are required to provide meeting notices to provide  
            notice by regular mail, email, or both and to comply with the  
            requester's chosen form of notification.

          2)Enhances unlicensed advertising enforcement.

          3)Requires DCA, the Attorney General (AG), and the Office of  
            Administrative hearings (OAH) to submit or continue to submit  
            specified reports to the Legislature annually.

          4)Extends the sunset of the Veterinary Medical Board (VMB) and  
            the term of its executive officer from January 1, 2016 to  
            January 1, 2017.

          5)Extends the sunset of the Certified Common Interest  
            Development Manager (CID manager) program and the Tax Preparer  
            Program from January 1, 2015 to January 1, 2019.

           FISCAL EFFECT  

          1)The California Department of Justice reports 2014-15 costs of  
            $1.3 million ($460,000 GF and $850,000 Legal Services  
            Revolving Fund) and ongoing costs of $1.7 million ($260,000 GF  
            and $1.5 million Legal Services Revolving Fund) for the AG to  


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            compile data and develop, design, and prepare the required  
            report. The AG is not currently required to report to DCA, the  
            Governor or any legislative committees, statistical data or  
            results of cases referred to the AG by constituent entities  
            comprising the department.  The AG reports they would  
            experience significant workload impacts.
          2)On-going costs to DCA in the range of $500,000 (GF) to develop  
            and implement the Board Mentor Program, to conduct the  
            required administrative expenses study, and to meet the  
            expanded requirements of the Department's annual report.   
            Additional unknown costs associated with the enforcement  
            training requirement.

          3)Veterinary Medical Board:  On-going special fund costs of  
            approximately $4.5 million annually (VMB Contingency Fund),  
            supporting 23.8 personnel years, to extend the sunset until  
            January 1, 2017, largely offset by fee revenues.  Costs to DCA  
            of extending the sunset are minor and absorbable within  
            existing resources.  

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


           1)Purpose  . In March 2014, the Senate Business Professions and  
            Economic Development Committee and the Assembly Business,  
            Professions and Consumer Protection Committee conducted joint  
            oversight hearings to review nine regulatory entities. The  
            Senate Committee also reviewed the performance and  
            effectiveness of the CID manager program. This is one of six  
            sunset extension bills intended to implement the recommended  
            legislative changes as a result of review by the Committees.

           2)Department of Consumer Affairs  .  The mission of DCA is to  
            "protect and serve the interests of California consumers." By  
            statute, consumer protection is the primary purpose for all of  
            the regulatory programs located within DCA, which consists of  
            26 boards, nine bureaus, two committees, one program, and one  
            commission. Collectively, these entities regulate more than  


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            100 types of businesses and 200 different industries and  
            professions. As regulators, these entities perform two basic  
            program functions: licensing and enforcement.  Licensing  
            entails ensuring only those who meet minimum standards are  
            issued a license to practice, and enforcement entails  
            investigation of alleged violations.  

            During the March 2014, sunset review hearing, and in the  
            Senate BPED background paper on DCA, several issues were  
            raised relating to the administration and operations of DCA.   
            This bill addresses some of the issues raised during the  
            sunset review process including greater transparency for  
            consumers and the Legislature, specific enforcement reporting  
            requirements, and expanding the telephone disconnect program  
            for unlicensed advertising. 

           3)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. Existing law  
            repeals the VMB as of January 1, 2016 and requires a review of  
            the VMB by the Legislature prior to that repeal.   
            When the Legislature reviewed the VMB in 2013, concerns were  
            raised about whether the board was taking sufficient and  
            timely actions to address specified issues. The VMB was  
            granted a two-year sunset extension.  This bill extends that  
            date by one year to allow the VBM to implement regulations and  
            responses to the issues raised in 2013.
          4)Tax Preparer program  . The California Tax Education Council  
            (CTEC) is a nonprofit corporation that represents tax  
            preparers in the state.  Existing law 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  
            Preparer program sunsets on January 1, 2015.

           5)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 sunsets on January 1, 2015.


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           6)Related Legislation  . This bill is one of six measures  
            introduced this session to extend sunsets on licensing boards  
            within the Department of Consumer Affairs - including SB 1242  
            (Lieu) pending on the Assembly floor, SB 1244 (Lieu) and SB  
            1245 (Lieu) both pending on this committee's Suspense File,  
            and SB 1246 (Lieu) and SB 1247 (Lieu) which are before this  
            committee today.

           Analysis Prepared by  :    Jennifer Swenson / APPR. / (916)