BILL ANALYSIS Ó
AB 1807
Page 1
ASSEMBLY THIRD READING
AB
1807 (Bonta)
As Amended May 27, 2016
Majority vote
------------------------------------------------------------------
|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Business & |16-0 |Salas, Brough, Baker, | |
|Professions | |Bloom, Campos, | |
| | |Chávez, Dahle, Dodd, | |
| | |Eggman, Gatto, Gomez, | |
| | |Holden, Jones, | |
| | |Mullin, Ting, Wood | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |20-0 |Gonzalez, Bigelow, | |
| | |Bloom, Bonilla, | |
| | |Bonta, Calderon, | |
| | |Chang, Daly, Eggman, | |
| | |Gallagher, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
| | |Jones, Obernolte, | |
| | |Quirk, Santiago, | |
| | |Wagner, Weber, Wood | |
| | | | |
| | | | |
AB 1807
Page 2
------------------------------------------------------------------
SUMMARY: Allows a licensee of the Bureau of Real Estate
(Bureau) to petition the Real Estate Commissioner (Commissioner)
to remove his or her notice of disciplinary action from the
Bureau's Internet Web site because the information is no longer
necessary to prevent a credible risk to the public.
Specifically, this bill:
1)Declares that it is appropriate for the Bureau to continue
reporting on its license verification Internet Web page, which
is hosted on the Bureau Web site when discipline has been
imposed upon a licensee for conduct that indicates a credible
risk of harm to the public; and that the Bureau may consider
and grant on a case-by-case basis a licensee's petition to
discontinue the posting of past disciplinary actions if he or
she can provide evidence that continued posting is no longer
required to reduce risk to the public.
2)Declares that the Bureau may require a petitioner to pay in
advance of consideration a fee to defray costs associated with
consideration of the petition.
3)Declares that the Bureau is not authorized or required to
destroy public records maintained pursuant to the California
Public Records Act.
4)Declares that the Legislature intends to establish a process
by which a licensee may petition the Bureau to remove a notice
of past discipline from the license verification Internet Web
site of the Bureau.
5)Provides that a licensee may petition the Commissioner to
remove the notice of discipline, as specified, if the action
has been posted for at least 10 years and the licensee
AB 1807
Page 3
provides evidence of rehabilitation indicating the information
is no longer necessary to prevent a credible risk to the
public.
6)Permits the Bureau to develop, through regulations, the
minimum information to be included in a licensee's petition,
including, but not limited to, a written justification and
evidence of rehabilitation.
7)Sets the fee to petition the Commissioner as the same as an
unrestricted license, as specified.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, the Bureau anticipates costs of approximately
$300,000 (special funds) beginning in 2016-17 and on-going for
the associated workload to process, review and make
recommendations on each request received. These costs are
supported by the fee authorized in the bill.
COMMENTS:
Purpose. This bill provides that a licensee of the Bureau may
petition the Commissioner to remove his or her notice of
disciplinary action from the Bureau's Internet Web site because
the licensee is no longer a credible risk to the public. This
bill is sponsored by the California Association of Realtors.
According to the author, "The current disciplinary system under
the [Bureau] serves an important role in ensuring consumers have
access to a real estate licensee's disciplinary history. That
information serves as a valuable tool in protecting consumers
AB 1807
Page 4
and promoting transparency. However, this tool has also
negatively impacted a small class of real estate licensees who
have had minor disciplinary actions on their record for many
years. Even after the licensee has been rehabilitated and the
license penalty has been removed, there isn't an opportunity to
have that action removed from the online database. This bill
simply provides the [Commissioner] the ability to determine how
long certain disciplinary actions should be posted online,
ensuring that rehabilitated licensees are operating on a level
playing field."
Background. The mission of the Bureau is to safeguard and
promote the public interests in real estate matters through
licensure, regulation, education and enforcement. The Bureau's
jurisdiction is licensing and regulating mortgage loan
originators, real estate and prepaid listing service licensees,
reviewing and approving subdivision and time share offerings,
and approving continuing education and pre-license courses.
A real estate license must first be obtained from the Bureau if
a person wishes to engage in the real estate business and to act
in the capacity of, advertise, or assume to act as a real estate
broker or real estate salesperson within the State of
California. Currently, there are approximately 535,000 real
estate licensees in California.
Under current law, low-level disciplinary actions that the
Bureau addresses via citation and fine do not appear on its Web
site. These infractions include, among others, when a person
without a real estate license engages in activities for which a
real estate license is required. The Bureau investigates these
situations following standards set in regulations.
Violations of provisions in law that warrant disciplinary action
can vary in greatly. For instance, a licensee may violate a
AB 1807
Page 5
seemingly minor provision of his or her licensure in a severe
way. As such, a violation of one licensee's provisions could
lead to the same disciplinary action as another licensee who
violated a completely different provision. Likewise, a licensee
who repeatedly violates his or her provisions may have a more
severe disciplinary action taken against him or her than a
licensee who is noticed for his or her first violation.
SB 706 (Price), Chapter 712, Statutes of 2011, requires the
Commissioner to post a notice of discipline on the Bureau's Web
site so that the information is available to a consumer who
searches specifically for that licensee. These notices are
posted to the Web site indefinitely. As such, the current
version of this bill makes all past disciplinary actions
ineligible to be removed from the Bureau's website until a
minimum of 10 years after the enactment SB 706; therefore, the
Bureau does not anticipate implementation costs until Fiscal
Year 2020-21.
However, according to the California Association of Realtors,
some licensees have used this information to gain a competitive
advantage over licensees with a record of discipline from the
Bureau, even if the violation for which the licensee was
disciplined is several years old, the licensee has complied with
corrective actions specified in the citation, and the violation
is no longer relevant to the licensee's ability to operate.
The Commissioner already has the authority to review
disciplinary actions against a licensee and evaluate whether the
disciplinary action should be modified. This bill would provide
an avenue for licensees to request a disciplinary action on the
BRE's Web site be removed if the Commissioner agrees that there
is evidence of rehabilitation and the licensee is not a
potential risk to consumers.
AB 1807
Page 6
Analysis Prepared by:
Gabby Nepomuceno / B. & P. / (916) 319-3301 FN:
0003332