BILL ANALYSIS Ó
SB 469
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Date of Hearing: June 30, 2015
ASSEMBLY COMMITTEE ON ARTS, ENTERTAINMENT, SPORTS, TOURISM, AND
INTERNET MEDIA
Ian Charles Calderon, Chair
SB
469 (Hill) - As Amended June 1, 2015
SENATE VOTE: 40-0
SUBJECT: State Athletic Commission.
SUMMARY: Would extend 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
combat sports, as specified, held or given in California.
Specifically, 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
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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
Committee on Medical and Safety Standards (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
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.
EXISTING LAW:
1) Prohibits, under the Muhammad Ali Boxing Reform Act (Federal
Boxing Act), events from taking place in a state without a
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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.
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(Title 4 California Code of Regulations (CCR) §§ 220 and 230)
6) Establishes an Advisory Committee on Medical and Safety
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
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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)
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)
FISCAL EFFECT: 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)
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
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Commission Fund)
COMMENTS:
1)Author's statement of need for legislation. According to the
author, "SB 469 in particular 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. Federal Law, the Muhammad
Ali Boxing Reform 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. While the Commission
has faced some administrative and front office challenges in
the past, the real work that they do, and do really well, is
on the ground level at the events. From the medical
walk-through to checking the ring or cage to ensuring the
fighter immediately undergoes a medical exam to staff ensuring
that a fighter gets paid on the spot; this is where the
Commission excels and it is important for regulation of events
to continue to ensure the highest degree of safety for the
many individuals participating in these sports."
2)Background:
a) Oversight Hearings and Sunset Review of Licensing Boards
and Programs. On March 18, 2015, the Senate Business,
Professions and Economic Development Committee and the
Assembly Business and Professions Committee and Arts,
Entertainment, Sports, Tourism and Internet Media Committee
(Committees) conducted a joint oversight hearing to review
the California State Athletic Commission, as part of our
regulatory oversight authority.
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This bill, as well as the 11 other regulatory agency sunset
bills considered this session, is intended to implement
legislative changes as recommended by staff of the Committees
and which are reflected in the Background Papers prepared by
Committee staff for each agency and program reviewed by the
Committees for this year.
b) California State Athletic Commission. The Commission is
responsible for protecting the health and safety of its
licensees; boxers, kickboxers and martial arts athletes.
Established by initiative in 1924, stemming from concerns
for athletes' injuries and deaths, the Commission provides
direction, management, control of and jurisdiction over
professional and amateur boxing, professional and amateur
kickboxing, all forms and combinations of full contact
martial arts contests, including MMA and matches or
exhibitions conducted, held or given in California. The
Commission oversees licensing, prohibited substance
testing, and event regulation. Functionally, the Commission
consists of four components; licensing, enforcement,
regulating events and administering the 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 current Commission mission statement, as stated in its
Strategic Plan, is as follows, "The California State
Athletic Commission is dedicated to the health, safety and
welfare of participants in regulated competitive sporting
events, through ethical and professional service." The
Commission is responsible for implementation and
enforcement of the Boxing Act and the State Act. The
Commission establishes requirements for licensure, issues
and renews licenses, approves and regulates events, assigns
ringside officials, investigates complaints received, and
enforces applicable laws by issuing fines and suspending or
revoking licenses.
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The Commission is comprised of seven members. Five members
are appointed by the Governor and subject to confirmation
by the California State Senate Committee on Rules
confirmation. One member is appointed by the Senate
Committee on Rules and one member is appointed by the
California Speaker of the Assembly. Commissioners are
part-time employees who receive a $100-a-day per diem.
There are no qualifications for an individual appointed to
the Commission; however, no person currently licensed as a
promoter, manager or judge may serve on the Commission. The
law also specifies that efforts should be made to ensure at
least four members have experience in either medicine as a
licensed physician or surgeon specializing in neurology,
neurosurgery, head trauma or sports medicine, financial
management, public safety, and the sports regulated by the
Commission.
The Commission meets about six times per year to handle
matters related to licensure and appeals of license
denials, suspensions and fines; propose and review
regulations or legislation focused on maintaining the
health and safety of fighters; consider issues related to
the Pension Fund and the Account; evaluate funding and
revenue strategies, and; address a variety of topics
brought forth by stakeholders.
According to information provided by the author, "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 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
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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
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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 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 (WADA)
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 seeking arbitration by the
Commission."
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3)Major provisions of proposed legislation. The following are
some of the major issues pertaining to the Commission along
with background information concerning the particular issue.
Recommendations were made by Committee staff regarding the
particular issue areas which needed to be addressed and
changes adopted are reflected below.
a) Issue: Medical Advisory Committee Quorum
Background: The State Act creates an Advisory Committee on
Medical and Safety Standards (MAC) consisting of six
licensed physicians who are appointed by the Commission.
The Commission has been advised that in order for the MAC
to receive a quorum, a majority of appointed members must
be present, which means that four of the six members must
attend meetings. According to the Commission, the MAC does
not always even have six member appointees who would be
eligible to attend these important meetings where guidance
on key safety issues is discussed and recommendations are
agreed upon to submit to the Commission as a whole. A
quorum is required for governing bodies to meet and conduct
official business or take official action such as voting on
agenda items. It is unclear whether this important advisory
committee can only meet if a quorum is achieved or if the
committee, the meetings for which are noticed publicly, can
meet with, for example, only a majority of the appointed
members present.
Recommendation and Proposed Statutory Change: Committee
staff recommended necessary changes to the State Act to
clarify how, when, according to what requirements for
public meetings and under what circumstances the MAC can
meet.
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This bill clarifies that a majority of the appointed
members of the MAC constitute a quorum for the purposes of
meeting.
b) Issue: Technical Changes May Improve the Effectiveness
of the State Act and Commission Operations, Use of
Performance Enhancing Substances and Drug Testing Costs.
Background: 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 and large fines to others for similar
violations.
The Commission has explored seeking increased authority to
collect fines so that it can more effectively discipline
its licensees, specifically by basing the amount of a fine
on a percentage of the fighter's purse. 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
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perpetuating use of the banned drugs without any noticeable
penalty. The Commission reports that having this option
will provide a greater level of deterrence for highly paid
athletes. Other states like Nevada take between 3 and 40%
of a fighter's purse for the event where the violation
occurs.
Recommendation and Proposed Statutory Change: Committee
staff recommended that the Committees authorize the
Commission in statute to adjust its fine collection
abilities so that it may collect a percentage of a
fighter's purse for certain substance abuse violations and
asked the Commission to advise the Committees of any
statutory changes necessary to continue to keep California
standards for banned substances on par with international
agencies like WADA. Committee staff also recommended making
technical changes to the State Act to clarify that athlete
licensees are subject to drug testing throughout the period
of their licensure, rather than only connected to an event
(drug testing directly prior to or at an event) and
recommended clarifying that blood and urine samples are
both acceptable for drug testing.
This bill 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. The bill also
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. This bill authorizes the Commission to
conduct drug testing at any time during the period of
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licensure for a professional or amateur boxer or martial
arts fighter licensed by the Commission and authorizes the
Commission to collect blood and urine specimens from a
professional or amateur boxer or martial arts fighter
licensed by the Commission in order to detect the presence
of any prohibited substances. The bill requires collection
of specimens to be done in the presence of authorized
Commission personnel. The bill also authorizes the
Commission to assess a fine equal to 40% of the total purse
for a violation of the prohibited substances provisions
outlined above.
c) Issue: Arbitration Cost Recovery
Background: 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. The Commission has exceeded its
AG expenditure authority yet has a statutory requirement to
assist fighters through this process. The question was
raised as to whether parties involved should absorb certain
costs, ensuring that any payment for arbitration does not
serve as a deterrent to licensees seeking arbitration.
Recommendation and Proposed Statutory Change: Committee
staff recommended that the Commission be authorized to seek
cost recovery for arbitration and requested that the
Commission provide additional information about the
instances under which it might collect reimbursement costs
for arbitration and what the options may be for determining
the costs paid by licensees (for example, a percentage of
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the disputed fees).
This bill codifies the Commission's existing authority to
recognize and enforce contracts between boxers and managers
and between boxers and licensed clubs and extends those
provisions to include martial arts fighters. The bill also
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 and authorizes the Commission to seek cost
recovery related to arbitration proceedings.
d) Issue: Continuation of the Commission
Background: California's professional and amateur boxers,
kickboxers and mixed martial arts athletes are better
served with appropriate oversight by a Commission, and the
state benefits from holding these events in California. If
the Commission goes away, large scale events held in
communities throughout the state will not happen, taking
with them the economic windfall to local businesses. Most
significantly, fighting will still take place, in an
underground, unregulated environment that is not conducive
to protecting athletes and promoting career opportunities
and abilities of many young people.
The most important work of the Commission happens on the
ground level, managing and overseeing events and promoting
the well-being of the competitors participating in combat
sporting events in California. While the Commission has
struggled with basic operational and administrative
functions over the years, the current membership and
management have shown a commitment to improve the
Commission's overall efficiency and effectiveness and are
working cooperatively with the Legislature and the
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Committees to bring about necessary changes.
Recommendation and Proposed Statutory Change: Committee
staff recommended the Commission's operations and the State
Act be extended for four years and be reviewed at that time
by the respective Committees of the Senate and Assembly.
Committee staff recommended that boxers, kickboxers and
mixed martial arts athletes continue to be regulated by the
current Commission members in order to protect the
interests of athletes and the public and be reviewed once
again in four years.
This bill extends the operations of the Commission until
January 1, 2020.
e) Issue: Technical Cleanup. This bill includes cleanup
provisions to clarify the State Act as recommended by the
Commission and Committee staff.
4)Prior and related legislation.
a) SB 309 (Lieu), Chapter 370, Statutes of 2013, extended
the operation of the California State Athletic Commission
until 2016.
b) AB 1186 (Bonilla), Chapter 506, Statutes of 2013,
clarified that the California State Athletic Commission is
authorized to regulate all forms of full contact martial
arts contests involving participants 18 years of age or
younger, including all forms and combinations of forms of
full contact martial arts contests deemed by the Commission
to be similar, and that an amateur contest includes a
contest where full contact is used, even if
unintentionally.
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c) AB 2100 (Alejo) of 2012, would have required that the
Commission, in consultation with the Association of Boxing
Commissions (ABC), to establish and enforce a professional
code of conduct, as specified, and that persons seeking
payment as promoters must make specified disclosures to the
CSAC prior to being compensated. (Status: The bill was
held in the Assembly Committee on Appropriations.)
d) SB 543 (Price), Chapter 448, Statutes of 2011, extended
the Commission sunset date for 2 years, from January 1,
2012 to January 1, 2014.
e) SB 294 (Negrete McLeod), Chapter 695, Statutes of 2010,
extended the Commission sunset date for one year, from
January 1, 2011 to January 1, 2012.
f) SB 963 (Ridley-Thomas), Statutes of 2008, extended the
Commission sunset date from July 1, 2009 to January 1,
2011.
g) SB 247 (Perata), Chapter 465, Statutes of 2006,
reestablished the Commission on January 1, 2007, as an
independent board through July 1, 2009.
5)Double Referral: Should this bill pass out this committee, it
will be re-referred to the Assembly Committee on Business and
Professions.
REGISTERED SUPPORT / OPPOSITION:
Support
There is no support on file.
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Opposition
There is no opposition on file.
Analysis Prepared by:Dana Mitchell / A.,E.,S.,T., & I.M. / (916)
319-3450