BILL ANALYSIS                                                                                                                                                                                                    Ó

          |SENATE RULES COMMITTEE            |                        SB 560|
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                                UNFINISHED BUSINESS 

          Bill No:  SB 560
          Author:   Monning (D)
          Amended:  8/17/15  
          Vote:     21  

           SENATE BUS, PROF. & ECON. DEV. COMMITTEE:  9-0, 4/13/15
           AYES:  Hill, Bates, Berryhill, Block, Galgiani, Hernandez,  
            Jackson, Mendoza, Wieckowski


           SENATE FLOOR:  35-0, 4/30/15
           AYES:  Allen, Anderson, Bates, Beall, Berryhill, Block,  
            Cannella, De León, Fuller, Gaines, Galgiani, Hall, Hancock,  
            Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu,  
            McGuire, Mendoza, Mitchell, Monning, Moorlach, Nguyen,  
            Nielsen, Pan, Pavley, Roth, Stone, Wieckowski, Wolk
           NO VOTE RECORDED:  Hernandez, Morrell, Runner, Vidak

           ASSEMBLY FLOOR:  78-0, 8/27/15 (Consent) - See last page for  

           SUBJECT:   Licensing boards: unemployment insurance

          SOURCE:    Contractors State License Board

          DIGEST:   This bill requires a licensing board, including the  
          State Bar and the Bureau of Real Estate, to provide personal  
          information regarding licensees to the Employment Development  
          Department (EDD) upon request.  This bill also authorizes the  
          Contractors State License Board's enforcement representatives to  
          issue a written notice to appear before a court to unlicensed  
          individuals who fail to secure workers' compensation insurance.


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          Assembly Amendments add the provisions related to personal  
          information about licensees being provided to EDD and make other  
          technical changes.  

          Existing law:

          1)Establishes an enforcement division in the Contractor's State  
            License Board (CSLB) and requires the unit to rigorously  
            enforce the Contractors Law prohibiting all forms of  
            unlicensed activity.  (BPC § 7011.4 (a))

          2)Authorizes an unlicensed contractor to advertise for  
            construction work only if the advertisement states that he or  
            she is not licensed.  (BPC § 7027.2)

          3)Makes it a misdemeanor for an unlicensed contractor to  
            advertise for construction or work or improvements or act in  
            the capacity of a contractor.  Imposes specified civil  
            penalties, including fines and imprisonment against the  
            unlicensed contractor and authorizes CSLB to cite the  
            unlicensed contractor.  (BPC § 7028) 

          4)Requires CSLB to initiate a disciplinary action against a  
            licensee within 180 days of receipt of a certified copy of the  
            Labor Commissioner's finding of a willful or deliberate  
            violation of the Labor Code by a licensee.  (BPC § 7110.5)

          5)Authorizes CSLB enforcement division to have free access to  
            all places of labor when participating in the enforcement  
            activities of the Joint Enforcement Strike Force on the  
            Underground Economy (JESF).  (BPC § 7011.4 (c))

          6)Establishes the JESF to coordinate efforts in targeting tax  
            evasion and cash-pay violations, and authorizes the sharing of  
            investigative and enforcement capabilities between JESF  
            participants.  (Unemployment Insurance Code § 329)

          This bill:

          1)Requires a licensing board, including the State Bar and the  


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                                                                    Page  3

            Bureau of Real Estate, to provide personal information  
            regarding licensees to the EDD upon request. 

          2)Authorizes the CSLB Enforcement Division to additionally issue  
            written notices to unlicensed contractors to appear in court  
            for failure to secure workers' compensation insurance.

          3)Makes other technical changes. 

          Statewide Investigative Fraud Team (SWIFT).  Unlicensed  
          contractor activity comprises part of an estimated $60 to $140  
          billion annual underground economy that takes money away from  
          healthcare, roads, and schools.  To combat unlicensed activity,  
          CSLB developed SWIFT.  This team seeks to identify and shut down  
          unlicensed operators in the construction industry by setting up  
          stings throughout the state.  The unit has the authority to  
          visit any job site without evidence, and ask contractors to  
          produce proof of licensure in good standing, citing those who  
          are not properly licensed.  While SWIFT enforcement  
          representatives are able to issue written notices to appear when  
          it is found that a contractor is operating without a license,  
          they do not have the authority to issue one when it is  
          discovered that the unlicensed contractor does not have workers'  
          compensation insurance.  This bill seeks to ensure that CSLB can  
          issue a notice to appear for this violation.

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

          According to the Assembly Appropriations Committee, this bill  
          results in minor and absorbable costs to the licensing boards to  
          provide information to EDD and minor and absorbable costs to  
          CSLB to enhance their enforcement activities.

          SUPPORT:   (Verified8/28/15)

          Contractors' State License Board (source)


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          Air Conditioning Sheet Metal Association
          Air-Conditioning & Refrigeration Contractors Association
          California Chapters of the National Electrical Contractors  
          California Legislative Conference of the Plumbing, Heating, and  
          Piping Industry
          California Professional Association of Specialty Contractors 
          Construction Employers' Association
          Finishing Contractors Association of Southern California
          United Contractors
          Western Line Constructers

          OPPOSITION:   (Verified8/28/15)

          None received

          ARGUMENTS IN SUPPORT: CSLB supports this bill, noting that it  
          will allow CSLB to additionally cite for not having Workers  
          Compensation insurance to allow that violation of law to become  
          part of the case that is forwarded to the local district  
          attorney for prosecution.  The CSLB believes that failure to  
          adequately insure employees against work-related injuries is a  
          significant component of the underground economy and this bill  
          provides an additional tool to help address this problem.

          ASSEMBLY FLOOR:  78-0, 8/27/15
          AYES:  Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,  
            Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang,  
            Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle,  
            Daly, Dodd, Eggman, Beth Gaines, Gallagher, Cristina Garcia,  
            Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,  
            Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones,  
            Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,  
            Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin,  
            Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea,  
            Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago,  
            Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber,  
            Wilk, Wood, Atkins
          NO VOTE RECORDED:  Frazier, Williams


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          Prepared by:Mark Mendoza / B., P. & E.D. / (916) 651-4104
          8/28/15 15:34:59

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