BILL ANALYSIS �
Bill No: SB
1327
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Roderick D. Wright, Chair
2011-2012 Regular Session
Staff Analysis
SB 1327 Author: Cannella
As Introduced: February 23, 2012
Hearing Date: April 10, 2012
Consultant: Art Terzakis
SUBJECT
State Government: business information: Internet Web site
DESCRIPTION
SB 1327 requires the Governor to create a "one-stop-shop"
Internet Web site to provide individuals with essential
information (e.g. permitting, licensing and regulatory) for
establishing a business in California. Specifically, this
measure:
1.Requires the Governor, or his/her designee, to establish
an Internet Web site to provide individuals with all of
the necessary information on how to start a business in
California.
2.Stipulates that the Internet Web site must contain
information on the licensing, permitting, and
registration requirements of state agencies and include,
but not be limited to, information that does all of the
following: (a) assist individuals with identifying
application forms and other necessary documents; (b)
provide a digital copy of all forms and documents
available for download; and, (c) instruct individuals on
how and where applications and other forms and documents
are to be submitted.
3.Requires that the Internet Web site be user friendly with
accurate information about licensing requirements.
SB 1327 (Cannella) continued
Page 2
4.Prohibits a state agency from using the Internet Web site
created pursuant to this measure as the exclusive source
of information for the public to access licensing
requirements.
5.Authorizes the imposition of reasonable fees as a
condition of accessing information on the Internet Web
site established pursuant to this measure.
SB 1327 (Cannella) continued
Page 3
EXISTING LAW
Existing law requires a business to obtain various licenses
from regulatory agencies.
Executive Order S-05-10 created the Office of Economic
Development in the Governor's office, for the purpose of
coordinating economic development activities in the state.
Existing law establishes the Office of Business Development
(GoBiz) within the Governor's Office, under the control of
a director who is appointed by the Governor, for the
purpose of serving as the lead entity for economic strategy
and marketing of California on issues relating to business
development, private sector investment and economic growth.
Existing law provides for the California Economic Strategy
Panel within the Labor and Workforce Development Agency to
provide recommendations regarding an economic development
strategic plan and charges the panel with the new
responsibility of addressing the development of a system of
accountability for use in the annual state budget process.
Existing law, the California Small Business Financial
Development Corporation Law, creates the Office of the
California Small Business Board and imposes numerous duties
on the Secretary of Business, Transportation and Housing.
Existing law creates the Office of Small Business Advocate
within the Office of Planning and Research, and imposes
various duties and requires the Governor to appoint the
director of the Office of Small Business Advocate.
Existing law provides for the California Business
Investment Services program, which is currently operated by
the Labor and Workforce Development Agency.
BACKGROUND
Purpose of SB 1327: The author's office notes that in
recent years many different surveys and organizations have
named California's business climate as one of the worst in
the nation due to issues such as "high regulatory costs"
and "high levels of state and local government spending and
debt." The author's office argues that these problems all
negatively affect the economy but perhaps those hardest hit
SB 1327 (Cannella) continued
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are small businesses. The author's office states that there
are approximately 3.4 million small businesses in
California, representing 99.2 percent of the state's
employers and 52.1 percent of California's private-sector
employment. The author's office contends that small
business owners often do not enjoy the benefits of
unlimited capital and time and that a complex permitting
and licensing system compounds the problem by adding
another barrier to starting a small business.
The author's office also points out that the Employment
Development Department (EDD) operates "CalGOLD," a database
that directs users to the correct agencies for permits and
licenses. The author's office argues that while useful,
CalGOLD does not store application forms; it is simply a
catalog of information. For example, if an individual
wanted to start a construction company building single
family homes, he/she would have to contact 14 different
state entities to obtain the necessary paperwork. This
measure is intended to correct the flaws with this existing
program (and others) by providing a centralized location
for all permitting needs.
Milton Marks "Little Hoover" Commission on California State
Government Organization and Economy: In February 2010, the
Little Hoover Commission released a report, entitled
"Making up for Lost Ground: Creating a Governor's Office
of Economic Development." The report analyzed the status
and effectiveness of the various entities of the defunct
Technology, Trade and Commerce Agency that had been
reorganized into other entities. The report recommended
the creation of a new governmental entity that would
promote greater economic development, foster job creation,
and deliver specific services such as permitting, tax, and
regulatory information directly to the California business
community.
The California Performance Review (Executive Order S-5-04):
In response to Governor Arnold Schwarzenegger's challenge
to change and reform California, the California Performance
Review (CPR) was established to restructure, reorganize and
reform state government and to make it more responsive to
the needs of its citizens and business community. One of
the recommendations of the CPR was to create a one-stop
business license center for California businesses.
SB 1327 (Cannella) continued
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The CPR noted that, "People who want to start a business in
California do not know where to begin. Even established
business owners find it difficult to navigate the state
bureaucracy. A one-stop business license center should be
created to provide a single point of contact, accessible by
both telephone and the Internet. Such a center would
streamline processes, resulting in better customer service
for business owners while increasing regulatory compliance
and revenue." The CPR continued, "People wanting to do
business in California must interact with the state to
establish and maintain their businesses. They must obtain
necessary permits and licenses, register their businesses,
report information and pay taxes. For instance, a business
in California is required to register with the state for
purposes of reporting sales taxes, income taxes, employee
wages and insurance. In addition, business owners are
required to obtain a variety of licenses and permits to
carry out certain activities, such as selling alcohol or
collecting debts. These are just a few of the requirements.
A business owner could be required to contact nine or more
state departments and agencies for a single business."
PRIOR/RELATED LEGISLATION
AB 29 (John A. Perez) Chapter 475, Statutes of 2011.
Created the Governor's Office of Business and Economic
Development (GO-Biz), prescribed specific tasks and duties
for the office, including reorganizing such entities as the
Small Business Advocate and CalBIS into this new office.
Also, required that this new office establish long-term
economic goals and strategies as well as specific and
effective services to California's businesses, both large
and small.
AB 978 (V. Manuel Perez) 2009-10 Session. Would have
required the State Chief Information Officer to collaborate
with the Department of Consumer Affairs to acquire a new,
integrated, enterprise-wide enforcement and licensing
system, as described, that will replace the current
licensing and monitoring system being used by the
department. (Held on Senate Appropriations Committee
Suspense File)
AB 1721 (Arambula), Chapter 631, Statutes of 2007.
Designated the Business, Transportation and Housing Agency
as lead agency on economic development activities, and
SB 1327 (Cannella) continued
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established a fund for receiving federal, state, local, and
private economic development moneys that can be used to
further state economic development activities.
SUPPORT: None on file as of April 6, 2012.
OPPOSE: None on file as of April 6, 2012.
FISCAL COMMITTEE: Senate Appropriations Committee
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