BILL ANALYSIS Ó
SB 468
Page 1
Date of Hearing: July 7, 2015
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Susan Bonilla, Chair
SB 468(Hill) - As Amended July 1, 2015
SENATE VOTE: 28-7
SUBJECT: Bureau of Security and Investigative Services:
licensees.
SUMMARY: Subjects the Bureau of Security and Investigative
Services (Bureau) to review by the appropriate committees of the
Legislature by January 1, 2020, and makes various changes to
provisions in the Alarm Company Act, Locksmith Act, Private
Investigator Act, Private Security Services Act, Proprietary
Security Services Act, and Collateral Recovery Act to improve
the oversight, enforcement and regulation by the Bureau of
licensees under each Act.
EXISTING LAW:
1)Establishes the Bureau within the Department of Consumer
Affairs (DCA). (Business and Professions Code (BPC) § 6980.1)
2)Establishes the following Acts:
a) Alarm Company Act (BPC § 7590)
b) Locksmith Act (BPC § 6980)
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c) Private Investigator Act (BPC § 7512)
d) Private Security Services Act (BPC § 7580)
e) Proprietary Security Services Act (BPC § 7574)
f) Collateral Recovery Act (BPC § 7500)
3)Requires applicants for a firearms permit to meet the
following requirements:
a) The applicant is a licensee, a qualified manager of a
licensee, or a registered uniformed security guard.
b) A certified firearms training instructor has certified
that the applicant has successfully completed a written
examination prepared by the Bureau and training course in
the carrying and use of firearms approved by the Bureau.
c) The applicant has filed with the Bureau a classifiable
fingerprint card, a completed application for a firearms
permit on a form prescribed by the Bureau, dated and signed
by the applicant, certifying under penalty of perjury that
the information in the application is true and correct.
d) The Bureau has determined, after investigation, that the
carrying and use of a firearm by the applicant, in the
course of his or her duties, presents no apparent threat to
the public safety, or that the carrying and use of a
firearm by the applicant is not in violation of the Penal
Code.
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4)Requires armed guards applying for a Bureau issued firearms
permit to submit a second set of fingerprints to the
Department of Justice (DOJ) to obtain a DOJ Firearm
Eligibility Determination before consideration of a firearms
permit from the Bureau. (BPC § 7583.23(c))
5)Specifies that any institution, firm, or individual seeking
the Bureau's certification as a firearms training facility
must complete an application that includes: the name and
location of the entity, the places, days, and times the course
will be offered, an estimate of the minimum and maximum class
size, the location and description of the range facilities,
and the names and certificate numbers of the Bureau-certified
firearms training instructors who will teach the course. (BPC
§ 7585.3)
6)States that applicants that wish to obtain a firearms
qualifications card must complete a course of training in the
carrying and usage of firearms according to the standards of
the Bureau's "Firearms Training Manual", which includes: the
moral and legal aspects of firearms usage, firearms
nomenclature and maintenance, weapon handling and shooting
fundamentals, emergency procedures, and prequalification range
training. Applicants are also required to take a
qualification course of fire which includes: range safety and
procedures, demonstration and dry firing, practice rounds, and
qualification firing.
(BPC §§ 7585 and 7585.6)
7)Requires Private Patrol Operators to maintain an accurate and
current record of all firearms and deadly weapons in the
possession of the licensee or any employee while he or she is
on duty. (BPC § 7583.2)
8)Requires Private Patrol Operators to deliver to the Director a
written report describing fully the circumstances surrounding
the discharge of any firearm, or physical altercations, as
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specified, with a member of the public while on duty, by a
licensee or any officer, partner, or employee of a licensee
while acting within the course and scope of his or her
employment within seven days after the incident. Authorizes
the Director to investigate any report to determine if any
disciplinary action is necessary. (BPC § 7583.2)
9)Specifies that any person registered as a security guard or
patrol person shall deliver to the Director of the DCA a
written report describing fully the circumstances surrounding
any incident involving the discharge of any firearm in which
he or she was involved while acting within the course and
scope of his or her employment, within seven days of the
incident and requires specified information to be provided on
the form provided by the Director.
(BPC § 7583.4)
10)Exempts California peace officers from Bureau firearms
training courses if he or she has successfully completed a
course of study in the use of firearms.
(BPC § 7583.22)
11)States that a private investigator (PI) must possess a valid
Bureau firearms qualification card on his or her person while
carrying a firearm during the course of an investigation.
(BPC § 7542)
12)States that every agreement, including, but not limited to,
lease agreements, monitoring agreements, and service
agreements, as well as all labor, services, and materials to
be provided for the installation of an alarm system, must be
in writing. (BPC § 7599.54)
THIS BILL:
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13)Subjects the Bureau to review by the appropriate committees
of the Legislature.
14)Beginning July 1, 2017, requires each applicant for a
firearms permit or renewal permit to undergo a psychological
evaluation by a licensed psychologist, or his or her designee,
the purpose of which is to assess the applicant's
psychological capability to exercise appropriate judgment,
restraint, and self-control.
a) Requires the licensed psychologist, or his or her
designee, to employ whatever psychological measuring
instruments or techniques deemed necessary to render a
professional opinion.
b) If the applicant does not pass the assessment or falls
outside the range of acceptable results set by the provider
of the assessment, requires the certified firearms training
facility, upon request by the applicant, to forward the
response data to a psychologist licensed by the Board of
Psychology for evaluation.
c) Authorizes the applicant to choose the licensed
psychologist and bear the costs of the evaluation. If the
applicant seeks employment with, or is employed by, a
licensee that has an established and approved process for
the Minnesota Multiphasic Personality Inventory (MMPI) or
other psychological evaluation, authorizes the applicant to
choose to submit the response data to a licensed
psychologist chosen by the licensee. Authorizes a licensee
employing this process to bear the costs of the evaluation.
d) Requires the psychologist to forward a written
psychological evaluation, on a prescribed form prescribed,
to the Bureau within 15 days of the evaluation, even if the
applicant is found to be psychologically at risk.
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e) Authorizes the Bureau to utilize the results of the
psychological evaluation, which shall include assessment
measures used and the reason for their inclusion, for up to
six months from the date of the evaluation after which the
applicant shall be reexamined.
f) Prohibits a person who has been found psychologically at
risk in the exercise of appropriate judgment, restraint, or
self-control from reapplying for a permit until one year
from the date of being found psychologically at risk.
g) Authorizes the Bureau to decide if the applicant shall
be administered an additional psychological evaluation
instrument after the discharge of a firearm, as specified,
in order to retain the firearms permit.
h) Exempts from this requirement peace officers, federal
law enforcement officers, and security guards applying for
a renewal firearms permit whose employer verifies that the
applicant has been employed for at least five years in an
armed position during which the applicant has not had a
firearms incident or violent incident, as specified.
15)Requires both a security guard and his or her employer to
submit a written report to the Director of the DCA of any
incident involving the discharge of a firearm while he or she
is on duty.
16)Requires the Bureau to conduct inspections of all firearms
training facilities in this state within 90 days after
issuance of a certificate to ensure compliance with applicable
Bureau requirements, rules, and regulations. Authorizes the
Bureau to conduct inspections prior to the issuance of the
certificate, and requires the Bureau to maintain a program of
random and target inspections of facilities to ensure
compliance with applicable laws.
17)Exempts Federal Law Enforcement Officers from Bureau
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firearms, power to arrest, and baton training requirements if
he or she has already completed a course of study for each.
18)Clarifies that private investigators who wish to carry a
concealed firearm must obtain and have on their person while
carrying out an investigation, both a Bureau issued firearms
permit as well as a Concealed Carry Weapons (CCW) permit.
19)Requires agreements entered into on or after January 1, 2016,
that contain an automatic renewal provision ("evergreen"
clause) to include a separate and clear disclosure advising
the consumer that the agreement he or she is entering into
contains an automatic renewal provision, as specified.
20)Updates the fine and citation structure for violations of
provisions in the Alarm Company Act, Private Investigator Act,
Private Security Services Act, and Collateral Recovery Act, as
specified.
FISCAL EFFECT: According to the Senate Appropriations Committee
analysis dated May 28, 2015, this bill will result in the
following costs:
BSIS costs of approximately $300,000 annually, and 3 PY of
enforcement staff, to conduct compliance inspections of
firearms training facilities.
BSIS costs of approximately $131,000 annually, and 2 PY of
licensing staff, to process psychological examinations
submitted with Firearm Permit applications.
Prevents expenditures of approximately $12.1 million,
supporting 51.4 PY, and the collection of approximately $12.1
million in fee revenues, beyond January 1, 2020.
Unknown penalty and fine revenue gains.
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COMMENTS:
Purpose. This bill is sponsored by the author. According to
the Author, "This bill is necessary to extend the sunset date of
the [BSIS] in order to ensure continued oversight of alarm
companies and their employees, locksmiths, private
investigators, private security services, proprietary security
services, and repossessors."
Background. The Bureau currently licenses about 380,000
companies and employees serving in the areas of alarm services,
locksmith services, private investigation, private security,
repossession, and firearm and baton training. Based on the past
three fiscal years, the Bureau issues an average of 1,900
company licenses, 71,000 employee registrations, and 12,000
Bureau firearm permits. On average, the Bureau renews 9,500
company licenses, 105,000 employee registrations, and 11,500
Bureau firearm permits each year.
Specifically, the Bureau regulates the following Acts: 1) Alarm
Company Act; 2) Locksmith Act; 3) Private Investigator Act; 4)
Private Security Services Act; 5) Proprietary Security Services
Act; and 6) Collateral Recovery Act.
The following are some of the major issues pertaining to the
Bureau along with background information concerning the
particular issue. Recommendations were made by Committee staff
regarding the particular issue areas which needed to be
addressed.
Sunset Review of the Bureau. Currently there is no sunset date
established for the Bureau or the six Acts which the Bureau
regulates. The 2015 Sunset Hearing was the Bureau's first
Sunset Review. The Bureau and DCA appear committed to working
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collaboratively with the Legislature and the Committees to find
solutions moving forward in the regulation of this important
industry and thus should have the opportunity to address new and
existing issues raised within the Bureau as well as from the
Committees. This bill will subject the Bureau to review by the
appropriate policy committees of the Legislature by January 1,
2020, in order to address the issues raised within the Bureau
and by the appropriate policy committees.
Mental Health Evaluations for Armed Guards. Currently,
California does not require mental health examinations for armed
guards. All applicant types, with the exception of proprietary
private security employers, must submit their fingerprints to
the Federal Bureau of Investigation and DOJ for a criminal
background check. Guards who apply for a Bureau Firearm Permit
must submit a second set of fingerprints to obtain a DOJ Firearm
Eligibility Determination. The DOJ Firearm Bureau then advises
the Bureau whether the individual may possess or is prohibited
from possessing a firearm based on the applicant's prior
criminal past or history of mental instability. In addition,
Bureau staff checks the Bureau's application and enforcement
databases for any possible prior disciplinary actions, citations
issued, or investigations related to the applicant. The
application database is where Bureau enforcement staff would
note an application hold. However, there is no national
database for disciplinary actions for the industries under the
Bureau's purview.
Although it is true that the DOJ will alert the Bureau of an
applicant's past restraining orders, suicide attempts, and
psychiatric holds, there are some individuals that may have
existing psychological and mental health issues and may not be
getting the mental health resources they should be receiving.
The DOJ only alerts the Bureau if there are reports filed
against the applicant, but does not look into the applicant's
mental health background or past history due to HIPPA and
patient privacy issues.
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Part of the Bureau's process of investigation is initiated
through media reports. There have been numerous reports by the
Center for Investigative Reporting that have highlighted that
the current process is not sufficient in addressing the mental
health needs and resources that armed guards need.
There are already many states that require some criteria for
mental health evaluations for their armed guards. Oklahoma, New
Mexico, Delaware, and Pennsylvania all require applicants
applying to be a licensed armed guard to pass a mental health
examination. This bill's provisions are modeled after
Oklahoma's requirement for a form to be submitted prior to
licensure. South Carolina, Massachusetts, and Maine also
require applicants to sign a form authorizing regulators to
check their mental health records. There is also currently a
petition to have federal standards for mandatory training,
mental health evaluations, reporting of records, and a national
database of armed guards and their gun usage.
As a result of public safety concerns on the mental stability of
individuals working as armed guards, this bill will require
applicants to undergo a psychiatric evaluation. According to
the author, "We would rather be proactive rather than reactive
to a situation involving the discharge of a firearm, especially
in regards to the public safety and these individuals who are
often placed in high stress and confrontational situations."
Mandatory Reporting Requirements. The Bureau is not required by
law to collect reports of shooting incidents involving armed
guards. However, entities overseeing the actions of licensed
armed guards are required to submit these reports. There is no
legal basis for the Bureau to collect reports of firearms
incidents involving arms guards.
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The Private Security Act requires security guards and their
licensed employer to report an incident within seven days of the
incident occurring. The process of reporting an incident of an
altercation with an armed guard begins with a Report of Incident
Form (RIF). After an RIF is submitted an investigation can be
initiated. The Bureau will also initiate an investigation if it
receives information regarding an incident from law enforcement,
a complaint, or a media article. After an investigation has
been completed the Bureau can file both an administrative action
and forward the case to the local District Attorney for
potential criminal actions. If no criminal charges are pressed,
then the licensee involved in the incident is subject to have
their license revoked or suspended. If criminal charges are
pressed, the Bureau will place a hold on the license until that
license expires. The Bureau continues to pursue administrative
action against the guard even if the convicted person is
incarcerated, to revoke the license. Administrative action by
the Bureau is made public on the Bureau's website upon the
filing of an accusation by the Attorney General's Office.
It is unknown how many incidents that meet the criteria for
reporting are not reported to the Bureau since this is a process
that depends upon self-reporting. However, if an incident rises
to the level of a licensee, qualified manager, or registrant
being arrested, the Bureau should receive a subsequent arrest
report from the DOJ. Specifically, the number of guard shooting
incidents is currently unknown because of this self-reporting
system and because the current Consumer Affairs System (CAS)
does not categorize reports based on the type of incident.
There is currently no consolidated database at the Bureau that
can supply quantifiable information as to the incident type in
which a report was filed.
In the Bureau's response to the 2015 Sunset Report, the Bureau
states, "Because of the inability of the Bureau's current
enforcement system to uniquely capture data on firearm
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incidents, the Bureau recently began manually tacking the
violent incident reports and identified 54 from July 1, 2014 to
March 1, 205, of which 24 related to firearm discharges by an
armed guard. Of these 24 cases, 11 are closed (two are pending
issuance of a citation and nine involved no violation). Based
on the information gathered in the investigation on the
remaining 13 cases, the Bureau anticipates pursuing disciplinary
action on six."
As a result of issues that have been raised about the
effectiveness of the self-reporting process for firearms
discharge incidents, this bill requires submission to the
Director of the DCA of a firearms incident report by both the
individual involved in the discharge incident as well as his or
her employer.
Firearms Training Facilities Oversight. Any institution, firm,
or individual seeking the Bureau's certification as a firearms
training facility must complete an application that includes: 1)
the name and location of the entity; 2) the places, days, and
times the course will be offered; 3) an estimate of the minimum
and maximum class size; 4) the location and description of the
range facilities; and 5) the names and certificate numbers of
the Bureau-certified firearms training instructors who will
teach the course. In addition, each owner or principal of the
training facility business must complete a Bureau personal
identification application form, pay the specified certification
fee, and submit fingerprints.
The initial and continued education firearms training course
offered by a Bureau-certified firearms training facility must
comply with the content and format specified in the Bureau's
Firearms Training Manual. However, the firearm training
facility is not required to provide its specific course
materials to the Bureau for approval.
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A Bureau-certified firearm or baton training facility, or
Bureau-approved school that provides training to private
proprietary security officers (PPSOs) or security guards does
not need to be approved by the Bureau of Private Postsecondary
Education (BPPE) in order to obtain the Bureau's certification
or approval, unless BPPE's law requires that they be approved.
The Bureau refers institutions to BPPE to verify their exemption
from BPPE's law.
There is no statutory requirement for the Bureau to inspect the
approved schools and firearm/baton training facilities; however,
the Bureau has the discretionary authority to do so. The Bureau
carried out a firearm training facility pilot program in Fiscal
Year 2012-13 and conducted 15 inspections, but due to staff and
workload issues, the inspections were discontinued. However,
the firearm/baton training facilities and approved trainers are
inspected as part of an investigation in response to a
complaint. The Bureau has the statutory authority to suspend or
revoke a firearm/baton training school's certification for
violations of the law. Also, the Bureau has the ability to
cancel the approval of an approved trainer.
As a result of issues that have been raised about the
comprehensiveness of firearms training facilities in providing
adequate training to licensees who pursue a Bureau Firearm
Permit, this bill will require the Bureau to conduct inspections
of all firearms training facilities in the state of California
to ensure compliance with applicable Bureau requirements, rules,
and regulations.
Training Exemptions for Federal Law Enforcement Officers. The
Private Security Services Act exempts specified peace officers
from the firearm training required as a condition for issuance
of the Bureau's Firearms Permit. Peace officers are already
required to complete firearms training through their employing
agency, hence the exemptions from the training required for
issuance of the Bureau's Firearms Permit. California does not
recognize Federal Law Enforcement Officers as California peace
officers. Therefore, any Federal Law Enforcement Officer would
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not qualify for the same exemptions mentioned above that
California peace officers would be eligible to receive even
though they are also already required to complete firearms
training through their employing agency. This bill will exempt
Federal Law Enforcement Officers from Bureau firearms, power of
arrest, and baton required training courses if he or she has
already completed a course of study in each of these subjects.
This will make requirements and exemptions for Federal Law
Enforcement Officers consistent with requirements and exemptions
for California peace officers, whose prior training has been
determined as sufficient for licensure.
Concealed Carry for PIs. Currently, the BPC does not prohibit
PIs from carrying a concealed weapon while carrying out an
investigation covered by the Private Investigator Act. However,
there is some concern about the transmittal of information from
the Bureau to licensees that a PI with a CCW permit may not
carry that concealed weapon while carrying out an investigation
covered by the Private Investigator Act. This bill clarifies
that PIs who wish to carry a concealed firearm may do so if he
or she possesses both a Bureau Firearm Permit and a CCW permit
while carrying out an investigation.
Evergreen Clause Disclosure. Currently, Alarm Companies are
exempt from specific disclosure requirements regarding automatic
renewal provisions in their contracts, known as "Evergreen
Clauses". This clause in the contract allows for automatic
renewal of the monitoring portion of the contract unless the
customer cancels the contract in writing by the date indicated
in the contractual agreement. The Bureau has stated that it
receives approximately 70 complaints per year related to
Evergreen Clauses, which comprises 40% of all alarm company
complaints received. Since these complaints involve a
contractual agreement, the Bureau states that is it frequently
limited in what it can do for the consumer. This bill requires
alarm companies to give their customers specific disclosure
about any automatic renewal provisions in their contracts.
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Cite and Fine Updates. The Bureau issues citations and fines as
a means to encourage compliance with the laws and regulations of
the six acts within the Bureau's oversight authority. Citations
are issued for the less egregious violations because the primary
intent is to encourage compliance as opposed to pursuing actions
to revoke or suspend licensure. This bill updates the fine and
citation structure for violations of provisions in the Alarm
Company Act, Private Investigator Act, Private Security Services
Act, and Collateral Recovery Act in order to help the Bureau
better encourage compliance with existing laws and regulations.
Current Related Legislation. SB 177 (Wiekowski) of the current
legislation session, extends the authorization of the Bureau to
issue an alarm company operator license to a limited liability
company (LLC) until January 1, 2019. STATUS: This bill is in
the Assembly Appropriations Committee.
AB 281 (Gallagher) of the current legislation session,
establishes a Collateral Recovery Disciplinary Review Committee
(DRC) within the Bureau to review a request of a licensee to
contest an administrative fine or to appeal the denial of a
license; authorizes licensed repossessors to display a printout
of their registration or a screenshot of their registration from
the Bureau's website; and makes other clarifying changes.
STATUS: This bill is in the Senate Appropriations Committee.
AB 921 (Jones) of the current legislative session, establishes a
Private Investigator Disciplinary Review Committee (DRC) within
the Bureau to review a request of a licensee to contest an
administrative fine or to appeal the denial of a license, and
authorizes an applicant applying for an original license or
renewal of a license as a private investigator to put his or her
email address on the application at his or her discretion.
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STATUS: This bill is in the Senate Appropriations Committee.
AB 1042 (Cooper) of the current legislative session, expands the
definition of a proprietary private security officer (PSO) by
requiring only one of the two specified criteria to be met and
includes examples of a PSO's duties that are likely to involve
interacting with the public. STATUS: This bill is in the Senate
Labor and Industrial Relations Committee.
AB 1097 (Holden) of the current legislative session, authorizes
alarm companies to distribute contracts to customers by
electronic means, as specified. STATUS: This bill is in the
Senate Judiciary Committee.
POLICY ISSUES:
In response to concerns raised by licensed repossessors relating
to violations of the Act regarding the use of an alias, the
author may wish to specify instead that licensees may be fined
for using a business name other than the name under which the
license is issued. In addition, the author may wish to restore
the Bureau's ability to issue a notice of warning for a
violation, rather than automatically imposing a fine, as
specified. The author may also seek to clarify that licensees
may be fined only for falsifying, rather than merely altering,
an inventory. In addition, based on concerns that some of the
fine increases were too high, the author may wish to consider
reducing the fine amount for failing to file a required report
to one hundred dollars and delete the fee increase for specified
violations.
The author may also wish to specify, for purposes of firearms
permits, that if a firearms permit is denied, that the denial of
the permit shall be conducted in accordance with the
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Administrative Procedures Act. The author may also wish to
clarify that exempt federal law enforcement officers are those
defined in federal law who have successfully completed a course
of study in the exercise of the power to arrest.
The author may also wish to consider extending the amount of a
time the Bureau has to inspect certified firearms training
facilities from 90 to 120 days to help the Bureau implement this
new requirement, and clarify that in addition to providing
notice of noncompliance to the facility, the Bureau may issue a
citation or take other disciplinary actions for violations. In
addition, the author may wish to increase fine amounts for
violations of alarm agents for failing to carry registration
from $100 to $150.
Lastly, the author may wish to clarify that the evergreen
disclosure shall also include an acknowledgement of notification
to be signed and dated by the consumer.
AMENDMENT(S):
1)On page 4, line 29, strike: alias and insert: a business name
other than the name under which the license is issued
2)On page 4, line 30, strike: The fine shall be and insert At
the bureau's discretion, the bureau shall issue a notice of
warning or a fine of
3)On page 6, line 19, strike: or alteration
4)On page 8, line 36, strike: two hundred fifty dollars ($250)
and insert: one hundred dollars ($100)
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5)On page 9, line 19, strike: fifty dollars ($50) and insert:
twenty five dollars ($25)
6)On page 10, line 33, add new subdivisions:
(b) If a firearms permit is denied, the denial of the permit
shall be in writing and shall describe the basis for the
denial. The denial shall inform the applicant that if he or
she desires, they may request a hearing in accordance with the
provisions of Chapter 5 (commencing with Section 11500) of
Part 1 of Division 3 of Title 2 of the Government Code if he
or she wishes to contest the denial and if a hearing is not
requested, engaging in rehabilitation actions as specified by
the Bureau does not constitute an admission of the violation
charged.
(c) The hearing shall be requested of the director within 30
days following notice of the issuance of the denial. However,
no hearing shall be granted to an individual who is otherwise
prohibited by law from carrying a firearm.
7)Specify that federal law enforcement officers are those who
are "as defined in subsection (c) of Section 926B of Title 18
of the United States Code who have successfully completed a
course of study in the exercise of the power to arrest."
8)On page 18, line 19, strike 90 and insert 120
9)On page 18, line 32, insert In addition to the notice, the
bureau may issue a citation or take other disciplinary action
for violations of applicable laws and regulations.
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10)On page 28, line 13, insert The disclosure shall include an
acknowledgement of notification to be signed and dated by the
consumer. An acknowledgement of notification with an original
signature is required for an automatic renewal provision to be
legally valid.
REGISTERED SUPPORT:
None on file.
REGISTERED OPPOSITION:
None on file.
Analysis Prepared by:Eunie Linden / B. & P. / (916) 319-3301