BILL ANALYSIS
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|Hearing Date:March 22, 2010 |Bill No:SB |
| |1171 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Gloria Negrete McLeod, Chair
Bill No: SB 1171Author:Negrete McLeod
As Introduced: February 18, 2010 Fiscal:Yes
SUBJECT: Regulatory board operations.
SUMMARY: Revises and recasts sunset review law to remove the
provision that a board automatically by operation of law become a
bureau under Department of Consumer Affairs if the board sunsets, and
instead provides for the removal of a board's members, and appointment
of a new successor board upon the sunset date. Removes references to
the Joint Committee for Boards, Commissions and Consumer Protection,
and instead authorizes the appropriate standing policy committees of
the Legislature to carry out the sunset review functions. Terminates
the terms of office of each board member and bureau chief within the
Department upon an unspecified sunset date, and authorizes successor
board members and bureau chiefs to be appointed, as specified.
Existing law:
1) Establishes the Department of Consumer Affairs (Department) within
the State and Consumer Services Agency, and provides that the
Department is under the control of the Director of Consumer Affairs
(Director) who is appointed by the Governor, subject to Senate
confirmation.
2) Provides that the Department consists of boards and bureaus that
have been created by law to license and regulate members of various
professions and vocations.
3) Provides that the boards are made up of appointees of the Governor
and the Legislature who perform their licensing and regulatory
functions; such as appointment of an executive officer, setting
educational and experience requirements for licensing and
regulatory activities. These boards are separate from the control
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of the Department.
4) Provides that the licensing bureaus are created and operate as part
of the Department and under its administrative control, and
generally provides that the Director may appoint a chief for each
bureau to carry out the powers and duties placed upon the Director
with reference to that bureau.
5) States the intent of the Legislature (in enacting these provisions
in 1994) that all existing and proposed consumer-related boards or
categories of licensed professionals be subject to a review on a
four-year cycle, unless circumstances warranted a longer or shorter
interval with respect to a given board.
6) Establishes, until January 1, 2012, the Joint Committee on Boards,
Commissions and Consumer Protection (Joint Committee) which is
charged with evaluating whether specified boards and regulatory
programs established within the Business and Professions Code have
demonstrated a public need for continued existence. The law
authorizes the Joint Committee to review the operations of certain
state boards whose members are appointed by the Governor or the
Legislature.
7) Provides for the periodic oversight review of the need for
continued state licensing and regulation of a profession and the
effectiveness of the administration of the licensing law by the
licensing board, referred to as the "sunset review" process.
8) Provides for licensing boards to become inoperative and be repealed
(sunset) on a specified date (either June 30 or January 1 of a
specified year as established in law) unless that date is extended
or deleted by the Legislature.
9) Provides that when a board sunsets, the Department succeeds to and
is vested with all the duties, powers, purposes, responsibilities,
and jurisdiction of that former board and its executive officer
that are not otherwise made inoperative or repealed.
10)Provides that whenever the regulatory program of a board that is
subject to sunset is taken over by the Department, that program
shall be designated as a "bureau."
11)Requires the State Board of Chiropractic Examiners and the
Osteopathic Medical Board of California which are created by
initiative act to submit certain analyses and reports to the Joint
Committee on specified dates and requires the Joint Committee to
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review those boards, hold hearings, and make certain evaluations
and findings.
12) Subjects the laws pertaining to interior design certification, tax
preparers, common interest development manager certification, and
massage therapist certification to the provisions of Sunset Review,
as specified, and provides for the acts of law to become
inoperative and repealed on a specified date unless that date is
extended or deleted by the Legislature.
This bill:
1) Revises and recasts the sunset review law to provide that when
a board becomes inoperative that the board's members are removed, as
specified, and a successor board will be appointed with the same
rights, duties, and membership parameters as the board it is
succeeding.
2) Deletes the provision that a board be designated as a bureau
under the Department if it sunsets.
3) Revises and recasts the sunset review law to strike out
references to the Joint Committee and instead authorize the
appropriate standing policy committees of the Legislature to carry
out the sunset review functions.
4) Terminates the terms of office of each board member and bureau
chief within the Department upon an unspecified date, and authorizes
successor board members and bureau chiefs to be appointed, as
specified.
5) Requires all boards and bureaus, with the assistance of the
Department, to prepare an analysis and submit a report to the
appropriate policy committees of the Legislature no later than 22
months before the board's membership or the bureau chief shall be
terminated. The analysis and report shall include, at a minimum,
the following:
a) Complaint, investigation and disciplinary action information.
b) Complaint, investigation and disciplinary action timeframes
and costs.
c) Average time between final complaint disposition and notice to
the complainant.
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d) Description of enforcement priorities.
e) Brief description of the fund condition, sources of revenue,
and expenditure categories for the last four fiscal years by
program component.
f) Licensing examination information, including costs, ownership
of the examination, the last assessment of relevancy and
validity, the areas examined and the passage rate for four years.
g) Any sponsored legislation and description of its budget change
proposals.
h) Assessment of the sufficiency of the licensing fees.
i) Description of improvements over the prior four years of the
enforcement, public disclosure, public accessibility, including
webcasts of proceedings, and fiscal condition.
j) Provides that if an annual report contains the required
information, that annual report may be submitted to the
committees and posted on the board's or bureau's Internet
Website.
6) Subjects the Osteopathic Medical Board of California, created
by initiative act, to review on an unspecified date and requires the
board to prepare an analysis and submit a report as specified to the
appropriate policy committees of the Legislature, and requires the
appropriate policy committees to hold interim hearings to receive
testimony on the board.
7) Subjects the State Board of Chiropractic Examiners, created by
initiative act, to review on an unspecified date and requires the
board to prepare an analysis and submit a report as specified to the
appropriate policy committees of the Legislature, and requires the
appropriate policy committees to hold interim hearings to receive
testimony on the board.
8) Subjects the laws pertaining to interior design certification
and the tax preparers to review by the appropriate policy committees
on an unspecified date.
9) Further authorizes the appropriate policy committees of the
Legislature to carry out certain sunset review processes, including
the following:
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a) Review the boards, bureaus, or entities that are subject to
sunset review.
b) Evaluate and determine whether a board or regulatory program
has demonstrated a public need for the continued existence of the
regulatory program and for the degree of regulation.
c) Investigate operations of boards or bureaus and hold public
hearings.
10)Authorizes the policy committee chairs to refer to interim study
review any legislative issues or proposals to create new licensure
or regulatory categories, change licensing requirements, modify
scope of practice, or create a new licensing board.
11)Makes conforming and technical changes.
FISCAL EFFECT: Unknown. This bill has been keyed "fiscal" by
Legislative Counsel.
COMMENTS:
1. Purpose. This bill is sponsored by the Author to update and
streamline the sunset review process. The Author states that the
bill revises the sunset process in two significant ways:
First, by providing that when a professional licensing board in the
Department of Consumer Affairs becomes inoperative or is repealed,
a successor board is created to succeed to, and be vested with all
of the duties, powers, purposes, responsibilities, and jurisdiction
of the prior board. In effect, this bill makes reconstitution of a
licensing board automatic, rather than having the board transform
into a bureau under the Department.
Second, by providing that the standing policy committees of the
Legislature may conduct sunset review hearings, and removing
references to the Joint Committee on Boards Commissions and
Consumer Protection.
2. Background. The current law regarding what happens when a
licensing board sunsets is part of what has been referred to as the
"Sunset Review" process. That law provides for the periodic
oversight review of the need for continued state licensing and
regulation of a profession and the effectiveness of the
administration of the licensing law by the licensing board. These
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provisions were enacted in 1994. It was the intent of the
Legislature at that time that all existing and proposed
consumer-related boards or categories of licensed professionals be
subject to a review on a four-year cycle, unless circumstances
warranted a longer or shorter interval with respect to a given
board.
The sunset review process relating to the sunset of a licensing board
is in part built on an assumption in law, that if a board is
operating poorly, and lesser measures have been or appear to be
ineffective in rectifying the problems, the board should be allowed
to sunset and the administration of the licensing act would be done
more efficiently and effectively if the board becomes a bureau
under the Department.
However, public input, accountability, and transparency are all
potentially lost through a bureau governance structure instead of a
board governance structure.
Under a bureau, the bureau chief is in charge and reports to the
Director of the Department. In bureaus, many decisions are made
through a closed-door administrative management structure.
Under a board governance structure, on the other hand, board members
are appointed and hold public meetings. The board members appoint
an executive officer who manages the operations of the board and
reports to the board members in public. Some boards have members
that are subject to confirmation by the Senate. This process is
deemed to be more accountable and transparent, and offers the
public more opportunity to participate.
3. Reconstitution Rather than Elimination. In recent years, when
problems have been identified with a variety of boards, the most
effective means of achieving resolution and change has been by
reconstitution of the board. This essentially creates a new board
by allowing appointing authorities to appoint new members to
replace problem members and to reappoint effective members. The
new board may then replace the executive officer if the executive
officer has been ineffective in managing the operations.
This has happened with the Dental Board, the Board of Optometry, the
Acupuncture Board, and the Athletic Commission in recent years and
has proven to be an effective method for initiating needed changes
The Author believes that the Legislature will be able to effectively
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make changes to a licensing board through reconstitution of the
membership of the board. This bill would make reconstitution
automatic when a board becomes inoperative.
4. Transferring Sunset Review Responsibilities to Policy Committees.
The bill also transfers the responsibilities for Sunset Review from
the Joint Committee to the standing policy Committees of the
Legislature and removes references to the Joint Committee. This is
in part a cost-savings measure which would eliminate the costs for
an additional legislative committee. Furthermore, over the years,
the sunset review process has relied heavily upon the expertise and
staffing of the standing legislative committees for much of the
sunset review work that the Joint Committee performs.
The Author believes that transferring the responsibilities to the
policy committees is an appropriate alternative if the Joint
Committee is eliminated and an appropriate next step in the
maturation of the Sunset Review process.
The bill also reflects efforts recently announced by the Assembly
Speaker and Senate President pro Tem to re-invigorate the Sunset
Review process to evaluate the effectiveness of boards and
commissions and provide continued oversight of these agencies.
5. Related Legislation This Session. SBX8 60 (Harman) enacts the Jobs
Protection Act, renaming the Joint Committee on Boards,
Commissions, and Consumer Protection as the Joint Committee on
Boards, Commissions and Consumer or Business Protection. Creates a
new legislative procedure for any bill that may have a statewide
economic impact affecting business. Requires the Assembly and
Senate Committees on Rules to refer any bill that may have a
statewide economic impact affecting business, as specified, to the
joint committee for the preparation of an economic impact analysis
and a hearing and approval, and requires the joint committee to
make an annual report. That bill was heard in Senate Rules
Committee on March 10, 2010 and held under submission.
SB 954 (Harman) is nearly identical to SBX8 60 (Harman). That bill
has not been set for hearing.
AB 1659 (Huber) creates the Joint Sunset Review Committee to conduct a
comprehensive analysis of every agency to determine if the agency
is still necessary and cost effective. Requires each agency
scheduled for repeal to submit a report to the committee containing
specified information, and provides for public hearings by the
committee. Requires an agency be eliminated unless the Legislature
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enacts a law, based upon a recommendation of the members of the
committee, to extend, consolidate, or reorganize the agency.
Specifies the committee shall be composed of members appointed by
the Senate pro Tempore, the Assembly Speaker, and the Governor.
States legislative intent to provide for the repeal of every entity
of state government (excluding constitutionally created agencies or
any agency related to higher education). That bill has been
referred to the Assembly Business and Professions Committee.
AB 2130 (Huber) abolishes the Joint Committee on Boards, Commissions,
and Consumer Protection, and instead makes the specified boards and
regulatory programs subject to review by the Joint Sunset Review
Committee (as established in AB 1659). Makes its provisions
contingent upon the enactment of AB 1659. That bill has been
referred to the Assembly Business and Professions Committee.
6. Prior Legislation. SB 638 (Negrete McLeod) in 2009, is a similar
measure to the current bill and would have revised the sunset
process by changing the default action of sunset to reconstitution
of the board rather than elimination of the board and creation of a
bureau, and transferring the responsibility for sunset review from
the Joint Committee to the policy committees in the Legislature.
That bill was made a two-year bill and subsequently was not moved
in 2010.
SB 963 (Ridley-Thomas, Chapter 385, Statutes of 2008) as amended
August 8, 2008, contained many of the same provisions that are in
this bill. In addition to reforming the sunset process, this bill
was complicated by several additional provisions relating to
specific board operations and raised strong objection from several
boards and professional associations. Ultimately, the Legislature
was unable to come to agreement with the Administration on the
policies, and the bill was eventually amended to simply provide for
sunset extensions for only those boards that were being sunsetted
the following year.
AB 1467 (Negrete McLeod, Chapter 33, Statutes of 2004) revised the law
to rename the Joint Legislative Sunset Review Committee to the
Joint Committee on Boards, Commissions, and Consumer Protection
confirming what was done through the passage of Senate Concurrent
Resolution No. 56 (Resolution Chapter 14 - 2004). The name was
changed to better reflect the jurisdiction of the Joint Committee
that was modified by the enactment of SB 364 (Figueroa, Chapter
789, Statutes of 2003).
SB 2036 (McCorquodale, Chapter 908, Statutes of 1994) created the
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sunset review process in California. This measure established the
Joint Legislative Sunset Review Committee to provide specific
review criteria and minimum standards of evaluation for legislative
and state agency use, and to subject all boards of the DCA to
periodic review and sunset.
7. Technical Amendments Needed. Several technical and clarifying
amendments need to be made to this bill.
a. The bill refers to appointing a new bureau chief to the
"remainder of the previous bureau chief's term." This reference
should be removed from the bill since a bureau chief is not
appointed for a specified number of years as is done with a board
member.
The following amendment should be made: On page 4, lines 4 and 5,
strike out "authorities, for the remainder of the previous bureau
chief's term" and insert "authority"
b. The bill requires sunset reports to be submitted to the
Legislature 22 months before the board's membership is
reconstituted. This timeframe was designed to work when board
sunset dates fell on July 1. However the bill sets sunset dates
to fall six months earlier, on January 1 of the specified year.
With this change, it is appropriate to adjust the timeframe for
submitting a report to the Legislature in the same way.
The following amendment should be made: On page 8, line, 37,
strike out "22 months" and insert "16 months"
c. In 2002, the Legislature established requirements for a
voluntary common interest development manager certification
program. The certification program is administered by a
"professional association for common interest development
managers," and subjected the law to review by the Joint
Committee. In 2008, the Legislature also established
certification of massage therapists by a Massage Therapy
Organization, and subjected that law to review by the Joint
Committee.
Therefore, it is appropriate to amend the bill to add the common
interest development manager certification program, and the
massage therapy certification law to the review schedule in the
bill.
On page 6, after line 40, insert:
(6) Common interest development manager certification: January
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1, _____.
(7) Massage therapy certification law: January 1, _____.
NOTE : Double-referral to Rules Committee (second.)
SUPPORT AND OPPOSITION:
Support: None receive as of March 17, 2010.
Opposition: None receives as of March 17, 2010.
Consultant:G. V. Ayers