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