BILL ANALYSIS                                                                                                                                                                                                    Ó

          |SENATE RULES COMMITTEE            |                       SB 1039|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |

                                UNFINISHED BUSINESS 

          Bill No:  SB 1039
          Author:   Hill (D) 
          Amended:  8/25/16  
          Vote:     21 

           SENATE BUS., PROF. & ECON. DEV. COMMITTEE:  6-2, 4/18/16
           AYES:  Hill, Block, Galgiani, Hernandez, Mendoza, Wieckowski
           NOES:  Bates, Berryhill
           NO VOTE RECORDED:  Jackson

           AYES:  Lara, Beall, Hill, McGuire, Mendoza
           NOES:  Bates, Nielsen

           SENATE FLOOR:  25-12, 6/1/16
           AYES:  Allen, Beall, Block, De León, Galgiani, Glazer, Hall,  
            Hancock, Hernandez, Hill, Hueso, Jackson, Lara, Leno, Leyva,  
            Liu, McGuire, Mendoza, Mitchell, Monning, Pan, Pavley, Roth,  
            Wieckowski, Wolk
           NOES:  Anderson, Bates, Berryhill, Fuller, Gaines, Huff,  
            Moorlach, Morrell, Nguyen, Nielsen, Stone, Vidak
           NO VOTE RECORDED:  Cannella, Hertzberg, Runner

           ASSEMBLY FLOOR:  51-29, 8/29/16 - See last page for vote

           SUBJECT:   Professions and vocations

          SOURCE:    Author

          DIGEST:  This bill makes several changes to the statutes  
          governing various boards and bureaus under the Department of  
          Consumer Affairs (DCA); includes specified fee increases for  
          several boards including the Dental Hygiene Committee of  


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          California (DHCC), the California Board of Optometry (CBO), the  
          Board of Registered Nursing (BRN), the Board of Pharmacy (BOP),  
          and the Contractors State License Board (CSLB); and eliminates  
          the Telephone Medical Advice Services Bureau (TMAS).  

          Assembly Amendments prohibit the biennial renewal fee for the  
          DHCC from exceeding $500; establish a specified minimum and  
          maximum fee amounts for the CBO and made other conforming fee  
          revisions; remove the fee increase for the Court Reporters Board  
          of California; remove the BOP from the statutory jurisdiction of  
          the Medical Board of California (MBC) and establish it  
          independently within the DCA; delete provisions removing the BOP  
          from the statutory jurisdiction of the MBC and establish it  
          independently within the DCA; delete BOP fee increases;  
          establish fees parameters for resident and nonresident  
          outsourcing facility licenses; authorize the CBO to inspect  
          premises in which optometry is being practiced or in which  
          spectacle or contact lenses are fitted or dispensed; clarify  
          that specified CBO fines shall not exceed $50,000 per  
          investigation; eliminate certain exemptions for veterinarians;  
          and add chaptering amendments. 


          Existing law:

          1)Requires the DHCC to establish by resolution the amount of the  
            fees that relate to the licensing of a registered dental  
            hygienist, a registered dental hygienist in alternative  
            practice, and a registered dental hygienist in extended  
            functions. Prohibits the biennial renewal fee from exceeding  
            $160.  (BPC § 1944)

          2)Establishes the CBO to regulate nonresident contact lens  
            sellers, registered dispensing opticians (RDO), spectacle lens  
            dispensers, and contact lens dispensers.  Establishes the  
            CBO's regulatory fees, including an initial registration fee,  
            a renewal fee, and a delinquency fee.  (BPC §§ 2546.9, 2565,  
            2566, 2566.1)


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           3) Requires the BRN to adopt regulations establishing standards  
             for continuing education for licensees, as specified, and  
             requires that the standards take cognizance of specialized  
             areas of practice.  (BPC § 2811.5)

           4) Prescribes various fees to be paid by licensees and  
             applicants for licensure, and requires all fees collected on  
             behalf of the BOP to be credited to the BOP Contingent Fund,  
             which is continuously appropriated as it pertains to fees  
             collected by the BOP.  (BPC § 4400)

           5) Requires the certain businesses that provide telephone  
             medical advice services to a patient at a California address  
             to be registered with the TMAS and further requires telephone  
             medical advice services to comply with the requirements  
             established by the DCA, among other provisions, as specified.  

           (BPC § 4999 et seq.)
           6) Prescribes various fees to be paid by licensees and  
             applicants for licensure with the CSLB, and requires fees and  
             civil penalties received under the Contractors' State License  
             Law to be deposited in the Contractors' License Fund, which  
             is a continuously appropriated fund as it pertains to fees  
             collected by the CSLB.  (BPC §§ 7137 and 7153.3)

           7) Provides for the licensure and regulation of structural pest  
             control operators and registered companies, as defined, by  
             the Structural Pest Control Board (SPCB) within the DCA.   
             (BPC §§ 8500-8697.4)

          This bill:

           1) Increases the statutory cap for the biennial renewal fee for  
             various types of registered dental hygienists from $160 to  


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           2) Establishes a specified minimum and maximum application fee  
             amount for nonresident contact lens sellers, registered  
             dispensing opticians, and spectacle lens dispensers and  
             increases minimum and maximum amounts for already established  
             fees.  Authorizes the CBO to periodically revise and fix the  
             fees, as specified.

           3) Clarifies that the $50,000 cap on the administrative fine  
             that the CBO may issue for violations of the ownership  
             prohibitions applicable to optometrists, optical companies,  
             and registered dispensing opticians is "per investigation."

           4) Authorizes the CBO to at any time inspect the premises in  
             which optometry is being practiced or in which spectacle or  
             contact lenses are fitted or dispensed, as specified.

           5) Specifies that the continuing education (CE) standards  
             established by the BRN for nurses shall take cognizance of  
             specialized areas of practice, as currently required, but in  
             addition the content shall be relevant to the practice of  
             nursing and shall be related to the scientific knowledge or  
             technical skills required for the practice of nursing or be  
             related to direct or indirect patient or client care.

           6) Requires the BRN to audit CE providers at least once every  
             five years to ensure adherence to regulatory requirements,  
             and requires the BRN to withhold or rescind approval from any  
             provider that is in violation of the regulatory requirements.

           7) Prescribes various fee changes to be paid by licensees and  
             applicants for licensure and requires these fees to be  


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             credited to the BRN Fund, which is a continuously  
             appropriated fund as it pertains to fees collected by the BRN  
             and also raises specified fees, and provides for additional  
             fees to be paid by licensees and applicants for licensure as  
             well as by schools seeking approval by the BRN.

           8) Modifies, on or after July 1, 2017, specified fees to be  
             paid by the licensees and applicants for licensure with the  

           9) Specifies that a veterinarian from another state or country  
             does not have to be licensed in California if they are  
             holding a current, valid license in good standing in another  
             state or country and provide assistance to a California  
             licensed veterinarian.  The California licensed veterinarian  
             shall maintain a valid veterinarian-client-patient  
             relationship and that the veterinarian providing the  
             assistance shall not establish a veterinarian-client-patient  
             relationship with the client, as specified.  Clarifies that a  
             veterinarian in good standing from another state does not  
             have to be licensed in California if they are called into  
             this state by law enforcement agency or animal control  
             agency, as specified.

           10)Eliminates the TMAS and repeals the requirement that certain  
             businesses that provide telephone medical advice services to  
             a patient at a California address to be registered with the  

           11)Raises specified fees to be paid by the licensees and  
             applicants to the CSLB and requires the CSLB to establish  
             criteria for the approval of expedited processing  
             applications, as specified.


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           12)Requires the operator licensed and regulated by the SPCB  
             prior to conducting an inspection as specified to be employed  
             by a registered company.  Requires that the written  
             inspection report be prepared and delivered to the person  
             requesting it, the property owner, or the property owner's  
             designated agent.  Requires all inspection reports to be  
             submitted to the SPCB and maintained with field notes,  
             activity forms, and notices of completion until one year  
             after the guarantee expires if the guarantee extends beyond  
             three years.  Requires the inspection report to clearly list  
             the infested or infected wood members or parts of the  
             structure identified in the required diagram or sketch.   
             Makes other clarifying and technical changes regarding the  

          Fee Changes for the CBO.  AB 684 (Alejo, Chapter 405, Statutes  
          of 2015), among other things, transferred the regulation of RDOs  
          from the MBC to the CBO, along with the authority to inspect  
          leases and premise locations for compliance with BPC section 655  
          (dealing with various kick-back arrangements).  However, neither  
          the MBC nor the CBO collected data on how many locations are  
          co-located, so there is no concrete data on how many registrants  
          are subject to inspection.  In the following years, the CBO will  
          collect the data and use it to further develop the inspection  

          Currently, the additional revenue brought in by a fee floor will  
          not support the inspection program.  After more data is  
          collected, the CBO will reassess the cost of this new function  
          (as recommended by the fee audit) and potentially increase fees  
          through the regulation process.

          Still, the fee audit shows that current RDO fee structure is not  
          sufficient to sustain the new RDO program.  The fee audit shows  
          that the proposed fee floor is just enough to sustain the  
          program without factoring in the requirements specified in AB  
          684.  Further, the CBO notes that there are a lot of "unknowns"  


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          pertaining to the total impact on the program in regards to the  
          license population and enforcement workload.   The fee auditor  
          recommended setting a fee floor, due to the immediate need, and  
          a fee ceiling high enough to allow the CBO to reassess total  
          impact after a few years of data collection.

          The auditor recommended fees based on cost per item.  However,  
          in an effort to even out the fees and make them more reasonable,  
          the DCA budgets used the auditor's projected program's  
          revenue/budget needs to determine the proposed fee structure.

          BRN CE Audits.  All BRN licensees are required by statute to  
          complete 30 hours of CE during each two year renewal cycle to  
          ensure continued competence. Licensees are required to submit  
          proof of their compliance by signing a statement under penalty  
          of perjury and agreeing to produce documentation upon request.   
          The BRN relies on adherence to CE standards as the primary  
          method of assuring the continued competence of its licensees,  
          but it has not institutionalized regular audits of licensees'  
          CEs or CE providers (CEPs) since 2002.  This issue was raised in  
          the 2011 Sunset Review Report.  

          Fee Changes for BRN.  The BRN Fund is maintained by the BRN and  
          includes the revenues and expenditure related to licensing  
          nurses.  According to the BRN, the cause of its projected  
          deficit is an ongoing problem.

          The BRN further indicates that as a result of the high volume of  
          work regularly referred to the Office of the Attorney General,  
          they have requested additional deputies beginning in fiscal year  
          (FY) 2016/17 and 10 senior legal analysts to comply with the  
          data reporting requirements contained in SB 467 (Hill), Chapter  
          656, Statutes of 2015.  The BRN also underwent a fee audit of  
          all fees to determine whether the BRN was charging appropriate  
          fees in order to conduct its business at an adequate service  
          level to provide public protection.  It was found that the BRN  
          has not been charging enough fees for many areas and has not  
          been collecting enough fees to support the increased enforcement  

          Fee Changes for the BOP.  The BOP's current statutory authority  
          establishes both a minimum and maximum level for all fees.  The  


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          BOP uses its regulatory authority to establish each fee within  
          this range.  As a result of a regulatory change that took effect  
          July 1, 2014, with few exceptions, all of the BOP's fees are at  
          their statutory maximums.  The BOP indicates that it is seeking  
          to realign its current fee structure to address a structural  
          imbalance in its current budget resulting from an increase in  
          annual authorized expenditures that is not offset by a  
          corresponding increase in revenue.  As a precursor to  
          establishing the new fee schedules, the DCA's Budget Office  
          completed a fee analysis of the BOP's fund condition and fee  
          structure in late 2015.  

          Requirements for Veterinarians from Other States.  This bill  
          makes changes to the exemption from California licensure for  
          out-of-state veterinarians who may consult or provide assistance  
          to a California licensed veterinarian to make it clear under  
          what circumstances veterinary practice in this state would be  

          TMAS.  Under current law, any business that provides telephone  
          medical advice services to a patient in California and who  
          employs or contracts with five or more health care professionals  
          to register with the TMAS.  TMAS receives, on average, 21  
          consumer complaints per year.  In the past five years, 105  
          complaints were received, and all but two were closed without  
          referral for investigation.  According to the most recent DCA  
          reports, there have been zero citations, fines assessed,  
          referrals for criminal or civil action, formal disciplinary  
          actions filed, or consumer restitution ordered by the TMAS in  
          the last five years.  DCA licensing boards already have  
          concurrent authority with the practice of healthcare by licensed  
          and unlicensed individuals and can effectively police this area  
          without TMAS. 

          Fee Changes for the CSLB.  The proposed fee increases for the  
          CSLB seek to provide the CSLB with sufficient funding to support  
          its existing budget and provide for reasonable inflationary cost  
          increases.  While costs have increased in every area in the last  
          few years, the most significant areas are in Personal Services,  
          DCA Pro Rata and Enforcement.  The CSLB anticipates that it will  
          have, by FY 2018/19, a deficit of approximately $6 million.   
          CSLB needs a fee increase in order to continue to provide its  


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          existing level of service to both licensees and consumers.  

          Inspection Requirements for Licensees of the SPCB.  Currently,  
          the Structural Pest Control Act outlines the procedures to be  
          followed during the performance of wood destroying organism pest  
          inspections and in the preparation of the accompanying  
          inspection reports and also provides guidelines for the  
          preparation of a notice of work completed and not completed  
          after a company completes work under a contract.  In 2010, the  
          SPCB created an Act Review Committee and tasked it with  
          reviewing the Act for the purpose of making recommendations to  
          modernize and improve the language for the benefit of consumers  
          and the pest control industry.  The proposed changes in this  
          measure related to SPCP are the result of that review and are  
          intended to clarify its provisions. 
          FISCAL EFFECT:   Appropriation:    Yes         Fiscal  
          Com.:YesLocal:   Yes

          According to the Assembly Appropriations Committee: 

          1)One-time costs of $260,000 and ongoing costs of $250,000 per  
            year for the BRN to audit providers of continuing education  
            (BRN Fund).

          2)Increased licensing fee revenues of about $23 million per year  
            to the BRN (BRN Fund).

          3)Increased licensing fee revenues of about $7 million per year  
            to the BOP (Pharmacy Board Contingent Fund).

          4)Increased licensing fee revenues of about $12.5 million per  
            year to the CSLB (Contractors Licensing Fund). 

          5)Unknown additional fee revenues due to increases in dental  
            hygienist license renewal fees (State Dental Hygiene Fund) and  
            for contact lens sellers, registered dispensing opticians, and  
            spectacle lens dispensers (State Optometry Fund).

          6)Reduced expenditures (and license fee revenues) of about  


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            $200,000 per year from the elimination of the TMAS Bureau  
            (TMAS Fund).

          7)Information technology costs to change fee amounts are  
            expected to be minor and absorbable. 

          SUPPORT:   (Verified8/26/16)

          Board of Pharmacy
          Board of Podiatric Medicine
          Board of Registered Nursing
          California State Council of Laborers

          OPPOSITION:   (Verified8/26/16) 

          American Nurses Association/California 

          ARGUMENTS IN SUPPORT:     The BRN is in support of this measure  
          and indicate that they will continue to work with the Committees  
          relating to CE to ensure the BRN safeguards the public by  
          confirming continued competence of its licensees.  The BPM is in  
          support of this measure as it was amended to eliminate the  
          provisions which would have removed it from the jurisdiction of  
          the Medical Board of California. The California State Council of  
          Laborers is in support of this bill as it pertains to the fee  
          schedule changes to the CSLB. 

          ARGUMENTS IN OPPOSITION:The American Nurses Association\  
          California (ANA\C) writes in opposition, "The ANAC supports  
          without question evidence-based nursing education, nursing  
          practice and evidence-based continuing nursing education.  
          Furthermore, we do not question the need for regular audits  


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          every 5 years.  We do however question the BRN's current  
          capacity of its already stretched-to-the-max staff to  
          effectively work on all the courses curriculums and approvals,  
          to efficiently process all CEPs applications and to provide  
          timely audits of all offered courses?."

           ASSEMBLY FLOOR:  51-29, 8/29/16
           AYES:  Alejo, Arambula, Atkins, Bloom, Bonilla, Bonta, Brown,  
            Burke, Calderon, Campos, Chau, Chiu, Chu, Cooley, Cooper,  
            Dababneh, Daly, Dodd, Eggman, Frazier, Cristina Garcia,  
            Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,  
            Roger Hernández, Holden, Jones-Sawyer, Levine, Lopez, Low,  
            McCarty, Medina, Mullin, Nazarian, O'Donnell, Quirk,  
            Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone,  
            Thurmond, Ting, Weber, Williams, Wood, Rendon
           NOES:  Achadjian, Travis Allen, Baker, Bigelow, Brough, Chang,  
            Chávez, Dahle, Beth Gaines, Gallagher, Grove, Hadley, Harper,  
            Irwin, Jones, Kim, Lackey, Linder, Maienschein, Mathis, Mayes,  
            Melendez, Obernolte, Olsen, Patterson, Steinorth, Wagner,  
            Waldron, Wilk

          Prepared by:Bill Gage / B., P. & E.D. / (916) 651-4104
          8/30/16 14:05:08

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