BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 469| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- 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: SB 469 Page 2 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held in California by the Commission within the Department of Consumer Affairs and makes the Commission inoperative and repealed on January 1, 2016.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 SB 469 Page 3 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) SB 469 Page 4 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 SB 469 Page 5 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 SB 469 Page 6 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 SB 469 Page 7 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) SB 469 Page 8 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 **** END ****