BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
1254 (Leno)
Hearing Date: 4/26/2010 Amended: 4/8/2010
Consultant: Bob Franzoia Policy Vote: B,P&ED 7-0
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BILL SUMMARY: SB 1254 would authorize the Contractors' State
License Board to issue a stop order to any licensed or
unlicensed contractor who has failed to secure workers'
compensation insurance coverage for his or her employees. This
bill would set forth specified procedures for the payment of
employees during a work stoppage subject to a stop order and for
an employer to request a hearing to protest a stop order. Upon
that request, this bill would require the board to hold a
hearing to affirm or dismiss the stop order and issue and serve
on all parties to the hearing a written notice of findings.
This bill would authorize the Director of Consumer Affairs to
designate 12 persons as peace officers for assignment to the
special investigations unit of the board.
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Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12 2012-13 Fund
Stop order hearings $27 $53 $53 Special*
New peace officer positions Minor initial costs; up to $35
annually Special*
* Contractors' State License Fund
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STAFF COMMENTS: The board estimates approximately 200 stop
orders annually. Of those, an estimated ten percent would
result in administrative dismissal and an estimated 35 percent
of the remaining orders would result in a hearing. The board
estimates, based on Department of Industrial Relations labor
standards enforcement workload data, that it would require two
hearing officers to conduct hearings, render decisions and
provide required notices. The board estimates that it will
staff these positions by redirecting existing positions. In
addition, during enforcement activities, the board could
additionally issue a citation. This may result in an increase
in revenue to the Contractors' State License Fund by an unknown
but probably minor amount and potentially increase Attorney
General and Office of Administrative Hearing costs if the
unlicensed contractor appeals the citation. Finally, the board
estimates that implementation would require 80 hours of
programming to be performed by board staff, projected to cost
roughly $3,000 during the second half of the 2010/11 fiscal
year.
This bill would increase the maximum number of designated board
peace officers from three to 12, subject to designation by the
Director of Consumer Affairs. Assuming the board reclassifies
existing Enforcement Representative I and II positions from
non-peace officer to peace officer classifications, costs are
estimated to be $35,000 annually in additional salary, benefits,
and potential physical fitness incentive costs. One-time costs
associated with the employee attending of peace officer academy
training would be minor and absorbable. This peace officer
designation does not permit the carrying of firearms.