BILL ANALYSIS Ó
AB 2192
Page 1
ASSEMBLY THIRD READING
AB
2192 (Salas)
As Amended April 6, 2016
Majority vote
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|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 2192
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SUMMARY: In March of 2016, the Assembly Committee on Business
and Professions and the Senate Committee on Business,
Professions and Economic Development (Committees) conducted
multiple joint oversight hearings to review 11 regulatory boards
within the Department of Consumer Affairs, including the Court
Reporters Board (CRB). This bill extends to January 1, 2021,
the provisions establishing the Board, as recommended by the
legislative sunset review committee. Specifically, this bill:
1) Extends the sunset date for the CRB to January 1, 2021.
2) Extends the sunset date for its Executive Officer (EO)
to January 1, 2021.
FISCAL EFFECT: According the Assembly Appropriations Committee,
this bill will result in on-going annual Special Fund costs of
approximately $1.0 million (Court Reporters Fund) to extend the
Board beyond the January 1, 2017, sunset date. This fund is
self-supporting with fee revenue.
COMMENTS:
Purpose. In March of 2016, the Assembly Business and
Professions Committee and the Senate Business, Professions and
Economic Development Committee conducted multiple joint
oversight hearings to review 11 regulatory boards within the
Department of Consumer Affairs (DCA). The Board is due to
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sunset January 1, 2017, and was among the boards under review.
This bill extends to January 1, 2021, the provisions
establishing the Board, as recommended by the legislative sunset
review committee.
Background. Court reporters are highly trained professionals
who stenographically preserve the words spoken in a wide variety
of official legal settings such as court hearings, trials, and
other pretrial litigation-related proceedings, namely
depositions. Court reporters work in courtrooms as official
reporters or in the private sector as freelance reporters who
provide deposition services. These transcripts, which include
testimony given under oath, are relied upon by the consumer as
an accurate source of information. The CRB carries out its
mission by testing, licensing and disciplining court reporters,
who use the title certified shorthand reporter (CSR), and by
recognizing the schools of court reporting that meet state
curriculum standards.
In California, a person must be licensed to work as a court
reporter in state courts (official reporter) or to act as a
deposition officer (freelance reporter). Freelance reporters
provide services as individual contractors or through court
reporting firms. There are approximately 6,800 licensed court
reporters in California, of which approximately 5,800 work
independently or for court reporting agencies, and approximately
750 to 1,000 work as employees of the state court system.
Joint Oversight Hearings and Sunset Review of DCA Licensing
Boards. In March of 2016, the Committees conducted multiple
joint oversight hearings to review 11 regulatory boards within
the DCA and one regulatory entity outside of the DCA. The
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sunset bills are intended to implement legislative changes
recommended in the respective background reports drafted by the
Committees for the agencies reviewed this year. During the
sunset review hearings, the Committees take public testimony and
evaluate the eligible agency prior to the date the agency is
scheduled to be repealed. An eligible agency is allowed to
sunset unless the Legislature enacts a law to extend,
consolidate, or reorganize the eligible agency.
In the Committee's background paper on the CRB, issues were
raised regarding the CRB's ability to maintain long-term fiscal
solvency, administer the Transcript Reimbursement Fund (TRF),
and enforce court reporting statutes against foreign court
reporting corporations. These issues are not addressed in this
bill. The Board will need to continue to focus on its fee
structure and the impending sunset of the TRF.
Statutory Fee Limit. The Board's license fee reached the
statutory limit of $125 in July 2010. This fee cap has not
changed since the Board was established in 1951 and is no longer
viable today. As such, the Board is facing a structural
deficit, which will lead to a decreasing reserve of 4.7 months
at the end of Fiscal Year 2016-17. While there is no statutory
mandatory reserve level for the Board, the TRF cannot be funded
when the Board reaches less than six months of operating
expenses in reserve. In addition, the DCA Budget Office has
historically recommended that smaller programs maintain a
contingency fund slightly above the standard three to six months
of reserve.
TRF Sunset. In 1981, the legislature created the TRF to fund
payment of court transcripts for indigent litigants in civil
matters. By law, a minimum of $300,000 of the Board's total
revenue must go to the TRF annually on July 1. The TRF is
scheduled to be repealed on January 1, 2017, at which time all
unencumbered funds remaining in the TRF, as of that date, will
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be transferred to the Court Reporters Fund. The TRF consists of
the Pro Bono program and the Pro Per program that differ in who
may apply and how much monetary assistance is available to
individual cases and all cases overall. The total amount of
annual funding for the Pro Per program is $30,000, which is
quickly exhausted each year as there are enough unpaid claims at
the end of the year to appropriate the full $30,000 at the
beginning of the next year, creating an ever-growing backlog of
applications. The remaining $270,000 in the TRF is allocated to
the Pro Bono program. This program runs on a fiscal year basis
and typically does not expend the full amount.
Foreign Court Reporting Corporations. According to the Board,
foreign corporations offering court reporting services are
operating in California without authorization. AB 1461 (Ruskin)
of 2009 sought to clarify that in addition to corporations, a
firm, partnership, sole proprietorship or other business entity
providing or arranging for shorthand reporting services (any
entity offering or providing the services of a shorthand
reporter) was barred from doing or failing to do any act that
constitutes unprofessional conduct under any statute, rule or
regulation, as specified. That bill died in the Assembly
Committee on Appropriations. SB 270 (Mendoza) of the current
legislative session attempts to address this issue but has been
met with heavy opposition from foreign court reporting
corporations. These corporations do not believe they are
subject to the provisions outlined in Moscone-Knox Professional
Corporations Act (Corporations Code Section 13400, et seq.)
because they are not professional corporations that offer
professional services. Instead these corporations believe they
only contract for professional services, and are therefore
exempt from rules that would otherwise apply to professional
corporations and licensees.
Current Related Legislation. SB 270 (Mendoza) of the current
legislative session seeks to clarify the CRB's authority over
foreign professional corporations and increase penalties for
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violations of law, the author proposed amendments that would
instead require these corporations to register with the Board.
NOTE: This bill is currently pending in the Assembly Business
and Professions Committee.
Analysis Prepared by:
Gabby Nepomuceno / B. & P. / (916) 319-3301 FN:
0003191