BILL ANALYSIS Ó ACR 131 Page 1 Date of Hearing: April 13, 2016 ASSEMBLY COMMITTEE ON APPROPRIATIONS Lorena Gonzalez, Chair ACR 131 (Patterson) - As Introduced February 2, 2016 ----------------------------------------------------------------- |Policy |Business and Professions |Vote:|16 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This resolution encourages the Department of Consumer Affairs (DCA) and its licensing entities to create policies that promote fairness and equity to guarantee that each licensee pays a fair amount, especially in regards to initial and ongoing license fees. ACR 131 Page 2 FISCAL EFFECT: 1)DCA has identified five programs that issue licenses based on birth months but do not prorate fees, resulting in some licensees having an initial licensure period of just over one year, with others having up to a full two years for the same fee. Should DCA implement changes likely recommended as a result of this resolution, the following costs would apply. a) Reduced fee revenues of $686,000 to the Medical Board of California (special funds). b) Unknown reduced fee revenues, likely exceeding $650,000, to the Board of Registered Nursing (special funds). c) Unknown reduced fee revenues, likely less than $100,000, to the Board of Pharmacy (special funds). d) Reduced fee revenues of approximately $22,000 to the Dental Hygiene Committee. e) Minor and absorbable costs to the Board of Chiropractic Examiners. 1)Absorbable costs of approximately $50,000 to DCA to implement necessary IT changes. 2)Minor and absorbable costs to the impacted boards to change business processes, forms, and materials. ACR 131 Page 3 COMMENTS: 1)Purpose. According to the author, this resolution "recognizes the many professionals in the state of California that provide a variety of services to Californians ranging from barbering and cosmetology to fields of medicine. Licensed professions bring valuable services and are also economic drivers within our state. This resolution expresses that it is the goal and intent of the Legislature to direct government entities in establishing policies that make it fairer for newly licensed Californian's to enter the workforce." 2)Background. Many boards and bureaus under Department of Consumer Affairs (DCA) operate a birth date renewal program. Instead of basing license renewals on the date of issuance of the initial license, these boards renew licenses based on birth date which allows the boards to spread out their workload throughout the year. Under the birth date renewal program, the initial license is valid from the license issuance date until the last day of the licensee's birth month in the second year of the two-year license term. Upon renewal of the license, the license will expire on the last day of the licensee's birth month, every other year. In practice, this means that the initial licensure period will vary from person to person, depending on when the applicant initially applied for licensure and when the applicant's birth month occurs. Some licensees will have an initial licensure period of just over one year, whereas others will have up to a full two years. In effect, a licensing board is able to collect a two-year license fee for less than two years of licensure. (On average, this should be about 18 months of licensure.) ACR 131 Page 4 In all of the cases where the fee is not prorated, the licensee would be paying the full initial fee amount, regardless of how long their initial license was in effect. Renewal periods extend to a full two-year cycle, but some entities report that licensees find it unfair that those licensees with a shorter initial license period still pay the full fee. This resolution encourages DCA to address this issue. 3)Prior Related Legislation. a) AB 773 (Baker), Chapter 336, Statutes of 2015, changed psychology license renewals from a birth month renewal to a biennial renewal program. b) AB 483 (Patterson) of 2015 would have required that the fees for an initial license, an initial temporary or permanent license, an original license, or a renewal for specified regulatory entities, be prorated on a monthly basis. This bill was vetoed by Governor Brown who stated that an equitable licensing fee policy "can be crafted more carefully and thoughtfully through regulation." c) AB 1758 (Patterson) of 2014 would have required that the fee for an initial temporary or permanent license or an original license be prorated on a monthly basis and authorized the licensing entities to impose an additional fee to cover the reasonable costs of issuing an initial or original license that expires in less than 12 months. This bill was held in the Senate Appropriations Committee. ACR 131 Page 5 d) SB 1236 (Price), Chapter 332, Statutes of 2012, among other things, required a pro rata formula for the payment of renewal fees by physician and surgeon supervisors of physician assistants (PAs) and required the Board to establish a pro rata formula for the payment of renewal fees by PAs. Analysis Prepared by:Jennifer Swenson / APPR. / (916) 319-2081 ACR 131 Page 6