BILL ANALYSIS
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|SENATE RULES COMMITTEE | AB 1659|
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THIRD READING
Bill No: AB 1659
Author: Huber (D), et al
Amended: 7/15/10 in Senate
Vote: 21
SENATE BUSINESS, PROF. & ECON. DEV. COMMITTEE : 6-0,
6/21/10
AYES: Negrete McLeod, Aanestad, Calderon, Correa, Florez,
Yee
NO VOTE RECORDED: Wyland, Oropeza, Walters
SENATE APPROPRIATIONS COMMITTEE : 11-0, 8/12/10
AYES: Kehoe, Ashburn, Alquist, Corbett, Emmerson, Leno,
Price, Walters, Wolk, Wyland, Yee
ASSEMBLY FLOOR : 73-3, 6/3/10 - See last page for vote
SUBJECT : State government: agency repeals
SOURCE : Author
DIGEST : This bill recasts existing law governing the
periodic review (Sunset Review) of departments,
administrative or regulatory boards, commissions,
committees, councils, associations, authorities, or other
offices of state government, however denominated, by
creating a new Joint Sunset Review Committee with the
responsibility to review and evaluate these state agencies
based on specific criteria and information provided by
these agencies.
CONTINUED
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ANALYSIS : Existing law establishes the Joint Committee
on Boards, Commissions, and Consumer Protection and, until
January 1, 2012, requires the Committee to hold public
hearings at specified times and to evaluate whether a board
or regulatory program has demonstrated a need for its
continued existence.
Existing law states the intent of the Legislature that all
existing and proposed state boards be subject to review
every four years to evaluate and determine whether each has
demonstrated a public need for its continued existence, as
specified.
This bill:
1. Creates a new Joint Sunset Review Committee (JSRC), to
identify and eliminate waste, duplication, and
inefficiency in government agencies and to conduct a
comprehensive analysis over 15 years, and on a periodic
basis thereafter, of every "eligible agency," as
defined, to determine if the agency is still necessary
and cost effective.
2. Requires each eligible agency scheduled for repeal, on
or before December 1 prior to the year it is set to be
repealed, to submit to JSRC a complete agency report
covering the entire period since it was last reviewed,
to include, but not be limited to:
A. The purpose and necessity of the agency.
B. A description of the agency budget, priorities,
and job descriptions of employees of the agency.
C. Any programs and projects under the direction of
the agency.
D. Measures of the success or failures of the agency
and justifications for the metrics used to evaluate
successes and failures.
E. Any recommendations of the agency for changes or
reorganization in order to better fulfill its
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purpose.
3. Requires JSRC to take public testimony and evaluate the
eligible agency prior to the date the agency is
scheduled to be repealed.
4. Requires the elimination of any eligible agency unless
the Legislature enacts a law to extend, consolidate, or
reorganize the eligible agency.
5. Prohibits an eligible agency from extending in
perpetuity unless specifically exempted from the
provisions of this bill.
6. Allows JSRC to recommend that the Legislature extend the
statutory sunset date for no more than one year to allow
JSRC more time to evaluate the eligible agency.
7. Specifies that JSRC shall be comprised of 10 members of
the Legislature as follows:
A. Five Senators appointed by the Senate Rules
Committee, not more than three of whom shall be
members of the same political party.
B. Five Assembly Members appointed by the Speaker of
the Assembly, not more than three of whom shall be
members of the same political party.
8. Requires JSRC to meet no later than 30 days after the
first day of the Regular Session to choose a chairperson
and to establish the schedule for eligible agency review
provided for in the statutes governing the eligible
agencies, for which a date for repeal has been
established by statute on or after January 1, 2011.
9. States that this bill should not be construed to change
the existing jurisdiction of the budget or policy
committees of the Legislature.
10.Defines "eligible agency" to mean any agency, authority,
board, bureau, commission, conservancy, council,
department, division, or office of state government,
however denominated, excluding an agency that is
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constitutionally created or an agency related to
postsecondary education.
Background
The "Sunrise" of Sunset Review in California . The concept
of sunset review law first began back in the 1970s. There
are now approximately 35 states which have some sort of
sunset review law on the books. Basically, the genesis
behind all sunset laws is to place a termination date on a
particular program or agency, and in the meantime, review
it to determine if it is still operating in an effective
and efficient manner, and whether it should continue.
When one talks about sunset or sunrise laws, they are
usually referring to a review of regulatory licensing
agencies. There are certainly other specific programs
which may be subject to sunset, but the idea of subjecting
an agency to a more formalized review process, before
allowing it to continue, or be established in the first
place, is unique to this type of law.
California was sort of a "Johnny-come-lately" to this
process. There had been prior attempts by the Legislature
to pass a sunset law, but in those instances the
legislation would have sunset both the board and the
licensing program of the particular profession. The law
which was passed in 1994, only sunsets the board - not the
licensing of the occupation. There are basically two
reasons for this, the first is obvious - in most instances
there is a continued need to license those professions
currently regulated by boards under the Department of
Consumer Affairs (DCA). To automatically terminate the
licensing requirements would have provided no benefit to
the review of these boards under the sunset law. The
second reason, however, is more important. Throughout 1993
and 1994, both the Senate Business and Professions
Committee and the Assembly Consumer Protection Committee
began a review of some of the 32 regulatory boards under
DCA. There was more concern with the boards' operation and
activities (or lack thereof) than whether there was a need
to continue the licensing of a particular profession. A
number of problems with these boards were identified and a
report was issued by the Senate Business and Professions
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Committee's Subcommittee on Efficiency and Effectiveness in
State Boards and Commissions titled, "Reforming and
Restructuring California's Regulatory Agencies" which
detailed a number of changes and recommendations regarding
these boards and also strongly recommended the
establishment of a Joint Legislative Sunset Review
Committee to provide specific review criteria and minimum
standards of evaluation for legislative and state agency
use, and subject all licensing agencies and regulatory
programs of DCA to periodic review and sunset.
For all these reasons and more, both the Legislature and
the Administration believed the more immediate task at hand
was to review these consumer boards at regular intervals.
If it was determined the board should sunset, then there
would be adequate time to determine if the entire licensing
program should be eliminated as well. (It should be noted
that the Hoover Commission and the Legislative Analyst's
Office (LAO) at that time both recommended establishing a
sunset review process for all regulatory consumer boards.)
In 1994, SB 2036 was signed into law which established the
Joint Legislative Sunset Review Committee. The Joint
Committee reviewed all boards and other programs under DCA
for a period of 10 years on an ongoing basis, until its
final review in 2005.
Brief Description of the Sunset Review Process . The law,
which went into effect on January 1, 1995, set in place a
schedule for review of all of the 32 independent boards and
programs under DCA. It allowed for an initial review of
all boards beginning in 1995 and ending in 1998. A
re-review of these boards was required after four or more
years from the initial review, and began in 1999 and ended
in 2005. All 32 boards and certain other programs and
bureaus of the Department were reviewed and re-reviewed
during the 10-year period.
The sunset date for each board allowed enough time for the
board to be reviewed by the Joint Committee, and for
legislation to be passed to extend the sunset date of the
board and make appropriate changes. The actual review
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process for the Joint Committee began with sending boards a
detailed questionnaire and a request for information which
covered every aspect of the board's operation for four
years. The boards were required to respond to this request
by October 1 of the year they were scheduled for review.
During this time, staff of the Joint Committee, Senate
Business and Professions Committee, Assembly Consumer
Protection Committee, and LAO worked together to prepare an
analysis and report on each board. (Staff also met with
boards to review documents and information provided, and
seek input from various consumer groups, and the Health and
Budget committees of the Legislature.) The report provided
a brief overview of the board's functions and programs,
identified issues or problem areas concerning each board,
and included preliminary recommendations for members of the
Joint Committee to consider. This included whether each
board scheduled for review should be terminated, continued,
or reestablished, and whether its programs or functions
should be restructured or revised.
The Joint Committee then conducted public hearings to
review the issues and preliminary recommendations. The
boards were provided an opportunity to respond, along with
the regulated industry, consumer groups and the public.
DCA participated in these hearings as well. After the
hearings, the Joint Committee provided DCA with copies of
all testimony and analyses prepared by staff. DCA then had
60 days to provide its own recommendations to the Joint
Committee. Once received, the Joint Committee then met to
review the recommendations of DCA and make final
recommendations to the Legislature.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12
2012-13 Fund
New JSRC Up to $150 Up to $300Up to
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$300 General*
* Senate and Assembly Contingent Funds
SUPPORT : (Verified 8/16/10)
National Federation of Independent Business
Physical Therapy Board of California
ARGUMENTS IN SUPPORT : According to the author's office,
there is no current process in place to review state
entities on a regular basis with the exception of boards
and commissions that fall under the Business and
Professions Code. Even the Committee that is charged with
doing that has not had members appointed to it since 2006.
As indicated by the author's office, the Legislature
creates new boards, commissions, agencies and departments
to solve a problem, but far too often there is no ongoing
oversight of the newly created bureaucracy to ensure it
actually solved the problem it was created to solve. The
author's office believes that this systematic dysfunction
can be fixed by conducting comprehensive, regular review of
state government to ensure taxpayer dollars are being used
wisely.
The author's office points out that in 1989, the Little
Hoover Commission issued a report, entitled "Boards and
Commissions: California's Hidden Government," which found
that, "California's multi-level, complex governmental
structure today includes more than 400 boards, commissions,
authorities, associations, councils and committees. These
plural bodies operate to a large degree autonomously and
outside of the normal checks and balances of representative
government." The Commission concluded that "the state's
boards, commissions and similar bodies are proliferating
without adequate evaluation of need, effectiveness and
efficiency."
The author's office further states that since the Little
Hoover report many more boards, commissions and other
entities have been added to the California government
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structure. Some estimate that there are about 1,000
government entities. Recently, the California Performance
Review commented on 339 state boards and commissions and
they also found, as Little Hoover did 20 years ago, that a
comprehensive listing of the entities that make up state
government does not exist. Despite several studies
suggesting reform is necessary, the Legislature has failed
to act. Current law, the author's office argues, needs an
enforcement mechanism to ensure that oversight work is part
of the annual legislative action.
The author's office also indicates that numerous other
states have a sunset review function. Texas, for example,
created its Sunset Advisory Commission in 1978. Since the
Commission's inception 58 agencies have been abolished and
another 12 agencies have been consolidated saving $27 for
each dollar spent on the Commission. Total savings
achieved by the Commission equals roughly five percent of
the state budget.
ASSEMBLY FLOOR :
AYES: Adams, Ammiano, Bass, Beall, Bill Berryhill,
Blakeslee, Block, Blumenfield, Bradford, Brownley,
Buchanan, Caballero, Charles Calderon, Carter, Chesbro,
Conway, Cook, Coto, Davis, De La Torre, De Leon, DeVore,
Emmerson, Eng, Evans, Feuer, Fletcher, Fong, Fuentes,
Fuller, Furutani, Gaines, Galgiani, Garrick, Gilmore,
Hagman, Hall, Harkey, Hayashi, Hernandez, Hill, Huber,
Huffman, Jeffries, Jones, Lieu, Logue, Bonnie Lowenthal,
Ma, Mendoza, Miller, Monning, Nava, Nestande, Niello,
Nielsen, V. Manuel Perez, Portantino, Ruskin, Salas,
Saldana, Silva, Skinner, Smyth, Solorio, Swanson,
Torlakson, Torres, Torrico, Tran, Villines, Yamada, John
A. Perez
NOES: Anderson, Arambula, Knight
NO VOTE RECORDED: Tom Berryhill, Norby, Audra Strickland,
Vacancy
JJA:mw 8/16/10 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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