BILL ANALYSIS                                                                                                                                                                                                    






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          |SENATE RULES COMMITTEE            |                        SB 469|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
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                                   THIRD READING 


          Bill No:  SB 469
          Author:   Hill (D)
          Amended:  6/1/15  
          Vote:     21  

           SENATE BUS, PROF. & ECON. DEV. COMMITTEE:  8-0, 4/27/15
           AYES:  Hill, Bates, Block, Galgiani, Hernandez, Jackson,  
            Mendoza, Wieckowski
           NO VOTE RECORDED:  Berryhill

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 5/28/15
           AYES:  Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

           SUBJECT:   State Athletic CommissionState Athletic Commission.


          SOURCE:    Author


          DIGEST:  This bill extends the operation of the California State  
          Athletic Commission (Commission) until January 1, 2020, and  
          makes changes to the laws governing the Commission's operations  
          and the Commission's oversight of professional and amateur  
          boxing, professional and amateur kickboxing, all forms and  
          combinations of full contact martial arts contests, including  
          mixed martial arts and matches or exhibitions conducted, held or  
          given in California.


          ANALYSIS:   


          Existing law:








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           1) Prohibits, under the Muhammad Ali Boxing Reform Act (Federal  
             Boxing Act), events from taking place in a state without a  
             regulatory commission unless the fight is regulated by either  
             another state's commission or on sovereign tribal land.   
             (Title 15 U.S.C.  6303)

           2) Provides, under the Federal Boxing Act, or State Athletic  
             Commission Act (State Act), for the licensing and regulation  
             of boxers, kickboxers, martial arts athletes and events held  
             in California by the Commission within the Department of  
             Consumer Affairs and makes the Commission inoperative and  
             repealed on January 1, 2016.  (Business and Professions Code  
             (BPC)  18600 et seq.)

           3) Establishes, until January 1, 2016, the Commission, renders  
             the Commission subject to review by the appropriate policy  
             committees of the Legislature and authorizes the Commission  
             to appoint a person exempt from civil service as Executive  
             Officer (EO).  (BPC  18602 and 18613)

           4) Provides the Commission with sole direction, management,  
             control of, and jurisdiction over all professional and  
             amateur boxing, professional and amateur kickboxing, all  
             forms and combinations of forms of full contact martial arts  
             contests, including mixed martial arts (MMA), and matches or  
             exhibitions conducted, held, or given within this state.   
             Provides that no event shall take place without the prior  
             approval of the Commission and that no person shall engage in  
             the promotion of, or participate in, a boxing or martial arts  
             contest, match, or exhibition without a license, and except  
             in accordance with the State Act.  (BPC  18640)

           5) Establishes Commission oversight for contracts between  
             boxers and managers and between boxers or managers and  
             licensed clubs and requires the original contract entered  
             into between managers and boxers and promoters and boxers to  
             be placed on file with the Commission at the time it is  
             approved.  Provides that all disputes between the parties to  
             the contract, including the validity of the contract, shall  
             be arbitrated pursuant to the provisions of the contract.   
             (Title 4 California Code of Regulations (CCR)  220 and 230)

           6) Establishes an Advisory Committee on Medical and Safety  







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             Standards (MAC) consisting of six licensed physicians  
             appointed by the Commission which meets for the purpose of  
             studying and recommending medical and safety standards for  
             the conduct of boxing, wrestling, and martial arts contests.   
             Requires a majority vote of the Commission to appoint a  
             person to the MAC.  (BPC  18645)

           7) Provides the Commission with enforcement authority to revoke  
             or suspend licenses or a violation of the State Act.   
             Authorizes the Commission to suspend temporarily, any license  
             until final determination by the Commission when, in the EO's  
             opinion, the action is necessary to protect the public  
             welfare or is in the best interest of boxing or martial arts.  
              Provides that a suspension may be without advance hearing,  
             but the suspended licensee may apply to the Commission for a  
             hearing on the matter to determine if the suspension should  
             be modified or set aside.  Requires an application for a  
             hearing to be in writing and received by the Commission  
             within 30 days after the date of suspension.  Requires the  
             Commission, upon receipt of such written request, to set the  
             matter for hearing within 30 days.  (BPC  18841 and 18842)

           8) Authorizes the Commission, EO or his or her duly authorized  
             representative to assess fines, not to exceed $2,500, for  
             each violation of any of the provisions of the State Act or  
             any of the rules and regulations of the Commission (contained  
             within Title 4 CCR 200-829).  States that the fine may be  
             assessed without advance hearing, but the licensee may apply  
             to the Commission for a hearing on the matter if such fine  
             should be modified or set aside in the manner outlined above.  
              (BPC  18843)

           9) Provides that if a licensee fails to pay any fine assessed  
             within 30 days after receipt of notice by the EO, after time  
             for appeal has passed or after action on an appeal by the  
             Commission, the Commission may, without hearing, revoke or  
             suspend the license held by the licensee and authorize the  
             Attorney General (AG) to bring an action in superior court to  
             collect the amount due and attorney's fees.  Provides that  
             the action shall be speedily determined by the court and  
             shall take precedence over all matters pending therein except  
             criminal cases, applications for injunction, or other matters  
             to which special precedence has been given by law.  (BPC   
             18844)







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           10)Provides that any person who otherwise violates any  
             provision of the State Act is guilty of a misdemeanor.  (BPC  
              18878)

           11)Provides that the administration or use of any drugs,  
             alcohol, or stimulants, or injections in any part of the  
             body, either before or during a match, to or by any boxer is  
             prohibited.  (Title 4 CCR  303)

          This bill:

           1) Extends the operation of the Commission until January 1,  
             2020.

           2) Codifies the Commission's authority to conduct drug testing  
             necessary to promote the health and safety of licensees by  
             providing that the administration or use of any drugs,  
             alcohol or stimulants or injections in any part of the body  
             or the use of any prohibited substance specified in the  
             Prohibited List of the World Anti-Doping Code, as promulgated  
             by the World Anti-Doping Agency, by a professional or amateur  
             boxer or martial arts fighter licensed by the Commission, is  
             prohibited.  

           3) Authorizes the Commission, in its discretion and through the  
             rulemaking process, to determine the necessity of exemptions  
             to the prohibition on prohibited substances for certain  
             licensees.

           4) Authorizes the Commission to conduct drug testing at any  
             time during the period of licensure for a professional or  
             amateur boxer or martial arts fighter licensed by the  
             Commission. 

           5) Authorizes the Commission to assess a fine equal to 40% of  
             the purse for a violation of the prohibited substances  
             provisions outlined above.

           6) Clarifies that a majority of the appointed members of the  
             MAC constitute a quorum for the purposes of meeting.

           7) Codifies the Commission's existing authority to recognize  
             and enforce contracts between boxers and managers and between  







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             boxers and licensed clubs and extends those provisions to  
             include martial arts fighters.  Clarifies that all disputes  
             between the parties to the contract, including the validity  
             of the contract, shall be arbitrated by the Commission  
             pursuant to the provisions of the contract.  Authorizes the  
             Commission to seek cost recovery related to arbitration  
             proceedings.

          Background
          
          This bill is one of five "sunset bills" the author is sponsoring  
          this session.  According to the author, this bill is necessary  
          to extend the sunset date of the Commission in order to ensure  
          the protection, health, welfare and safety of the athletes and  
          fighters licensed by the Commission who participate in sports  
          and events the Commission oversees.  According to the author,  
          the Federal Boxing Act prohibits events from taking place in a  
          state without a regulatory commission unless the fight is  
          regulated by either another state's commission or on sovereign  
          tribal land.  Regulated events result in higher levels of  
          protection for fighters than unauthorized or illegal events, in  
          addition to added revenue for the state and a boon to the local  
          economy where events take place.  

          The Commission is responsible for protecting the health and  
          safety of its licensees:  boxers, kickboxers, and other martial  
          arts athletes.  The Commission, now comprised of seven members,  
          is also responsible for implementation and enforcement of the  
          Federal Boxing Act and the State Act.  It provides direction,  
          management, and control for professional and amateur boxing,  
          professional and amateur kickboxing, and all forms and  
          combinations of full contact martial arts contests, including  
          MMA and matches or exhibitions conducted, held or given in  
          California.  The Commission has four main functions:  licensing,  
          enforcement, regulating events and administering the  
          Professional Boxers' Pension Fund.  In 2014, the Commission  
          supervised 128 events.  As of March 2015, the Commission has so  
          far supervised 38 events, including 18 boxing, eight MMA, one  
          kickboxing.

          The Commission has direct disciplinary authority to issue  
          immediate suspensions and fines to ensure violations by  
          Commission licensees are handled and reported quickly.  The  
          Commission also has the ability to issue cease and desist orders  







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          for unauthorized, illegal events in addition to the suspensions  
          and license revocations for violations of the State Act and  
          accompanying Commission regulations and rules.  The Commission  
          partners with the Office of the AG when license revocations,  
          suspension or application denials are appealed.  The Commission  
          also conducts arbitrations for its licensees when disputes arise  
          within either the boxer-manager or boxer-promoter agreements and  
          has sole authority over these arbitration proceedings. The  
          Commission's citation and fine option allows the Commission to  
          penalize licensees rather than pursue formal discipline for less  
          serious offenses, or offenses where probation or license  
          revocation is not appropriate.

          The State Act creates the MAC consisting of six licensed  
          physicians who are appointed by the Commission.  This is the  
          body the Commission looks to for guidance on key safety issues  
          and meets to study, discuss and recommend standards for  
          contests.  This MAC rarely meets because of issues related to  
          how many people constitute a quorum for purposes of an open  
          meeting but should meet far more frequently, as these physicians  
          typically know the landscape of the fighting world and can help  
          the Commission better promote fighter health and safety.   
          Particularly with all of the new studies and research  
          documenting traumatic brain injury and technological advances to  
          assess these injuries, it is important for the Commission to  
          know what steps it may need to take to stay on top of licensee  
          health based on the advice of the MAC.

          The Commission currently has one of the most thorough drug  
          testing programs in the regulated combat sports landscape, but  
          maintaining this important effort has high costs associated with  
          it.  The Commission's cite and fine ability allows for  
          punishment to licensees for violations of the law that while  
          significant, may not be serious enough to warrant license  
          suspension.  Fines are used as a penalty and are usually  
          accompanied by a suspension or order to correct conduct.  They  
          are commonly issued against fighters for using prohibited  
          substances and conduct that brings discredit to combative sports  
          or the Commission.  The Commission's current fines may not be  
          deterring certain activity and may not be strong enough to make  
          any kind of impact to professional fighters receiving high  
          salaries.  The Commission has also struggled to establish  
          consistency in its citation and fine program, sometimes  
          assigning small fines to certain fighters for some violations  







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          and large fines to others for similar violations.  Some athletes  
          receive over six figures to participate in bouts, and paying a  
          $2500 fine for use of an illegal substance does not make a dent  
          in their earnings, thus potentially perpetuating use of the  
          banned drugs without any noticeable penalty.  Making it clear in  
          the State Act, rather than  just within the Commission's rules,  
          that using prohibited substances on the World Anti-Doping  
          Agency's prohibited list is also prohibited in California, while  
          also increasing the amount the Commission may assess for a  
          violation, serves to maintain the integrity of these bouts and  
          protect the participants.  When a fighter uses performance  
          enhancing substances they can not only harm themselves but may  
          also do more damage to an opponent than they otherwise would  
          have and establishing deterrents to this practice assists the  
          Commission in fulfilling its oversight responsibilities.
           
          The Commission is responsible for arbitration between licensees  
          and managers or promoters when contract disputes arise.  The  
          Commission absorbs costs related to arbitration for contract  
          disputes that it oversees that may impede its ability to  
          maintain a healthy fund balance.  The Commission utilizes the  
          services of the AG to conduct arbitration proceedings and is  
          then billed for these services at a rate that is not feasible  
          for the Commission to pay on an ongoing basis, as the Commission  
          has consistently exceeded its AG expenditure authority but at  
          the same time has a statutory requirement to assist fighters  
          through this process.  This bill seeks to allow for cost  
          recovery while ensuring that any payment for arbitration does  
          not serve as a deterrent to licensees seeing arbitration by the  
          Commission.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   Yes

          According to the Senate Appropriations Committee:

           Projected expenditures of approximately $1.6 million annually  
            (primarily from the Athletic Commission Fund), supporting 10.7  
            PY, until January 1, 2020, fully offset by annual fee revenues  
            of approximately $1.7 million.

           Costs of approximately $115,000 in 2016-17 and $107,000  
            annually ongoing for .5 PY of staff time and expenses related  
            to additional drug tests. (Athletic Commission Fund)







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           Estimated one-time costs of up to $50,000 in 2015-16 to  
            develop and adopt regulations providing for exceptions to drug  
            testing requirements. (Athletic Commission Fund)

           Unknown increases in fine revenues for violations related to  
            the use of prohibited substances.  (Athletic Commission Fund)


          SUPPORT:   (Verified6/1/15)


          None received


          OPPOSITION:   (Verified6/1/15)


          None received





          Prepared by:Sarah Mason / B., P. & E.D. / (916) 651-4104
          6/1/15 16:23:45


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