BILL ANALYSIS �
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|Hearing Date:June 16, 2014 |Bill No:AB |
| |2024 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Ted W. Lieu, Chair
Bill No: AB 2024Author:Bonilla
As Introduced: February 20, 2014Fiscal: Yes
SUBJECT: Professional fiduciaries.
SUMMARY: Authorizes the Professional Fiduciaries Bureau to establish
a retired status license; prohibits a professional fiduciary from
practicing with a retired or cancelled license; provides that an
expired professional fiduciary license, that is not renewed within
three years, shall not be renewed, restored, or reinstated; clarifies
the Bureau's authority to investigate any professional fiduciary with
a retired, inactive, canceled, or suspended license; makes technical,
updating and conforming changes.
Existing law:
1)Licenses and regulates professional fiduciaries under the
Professional Fiduciaries Act (Act) by the Professional Fiduciaries
Bureau (Bureau) within the Department of Consumer Affairs (DCA), and
makes the Bureau inoperative and repealed on January 1, 2015.
(Business and Professions Code (BPC) � 6510)
2)Establishes a Professional Fiduciaries Advisory Committee composed of
seven members: three members of which are licensed as professional
fiduciaries, and four are public members. The three licensees and
two public members are appointed by the Governor and the Senate
Rules Committee and the Assembly Speaker each appoint a public
member of the Committee. (BPC � 6511)
3)Provides that if the Bureau is repealed, the responsibilities and
jurisdiction of the Bureau shall be transferred to the Professional
Fiduciaries Advisory Committee, and that Committee shall be
established as a board within DCA. (BPC � 6510 (h))
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4)Authorizes the Bureau to investigate the actions of any professional
fiduciary for any breach of the law, and authorizes the Bureau to
impose disciplinary action, including: license denial, suspension,
probation, or revocation, and requires the Bureau to provide, on the
Internet, information regarding any enforcement action(s). (BPC �
6580)
5)Provides that no person shall act or hold himself or herself out as a
professional fiduciary unless that person is licensed as a
professional fiduciary in accordance with the Act, or is exempt
from the Act. Those exempt from the Act include: attorneys, CPAs
acting within their scope of practice, and enrolled agents acting
within their scope of practice.
(BPC � 6530)
6)Prohibits a professional fiduciary from practicing with an expired,
suspended, or revoked license. (BPC � 6531)
7) Requires that in order to renew a license, a professional fiduciary
must complete 15 hours of approved continuing education courses
each year. (BPC � 6538)
8) Requires the Bureau to set licensing and renewal fees by regulation
at an amount necessary to recover the costs to the Bureau in
carrying out the provisions of the chapter. (BPC � 6592)
This bill:
1)Authorizes the Bureau to establish, by regulation, a system for the
placement of a license into retired status, as specified.
a) Requires the Bureau to deny an application to place a license
in retired status if the license is subject to an outstanding
order of the Bureau, suspended, placed on probation, revoked, or
otherwise punitively restricted by the bureau, or subject to
disciplinary action.
b) Provides that a retired license shall not be required to be
renewed.
c) Requires the Bureau to establish minimum qualifications to
place a license in retired status, and to restore a license from
retired status to active status. The minimum qualifications
shall include, but are not limited to, completion of continuing
education hours, submission of a statement, and payment of a fee,
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as specified.
2)Prohibits a professional fiduciary from practicing with a retired or
cancelled license.
3)Provides that a professional fiduciary license that is not renewed
within three years following its expiration shall not be renewed,
restored, or reinstated, and the license shall be canceled
immediately upon expiration of the three-year period.
4)Requires that, in order to restore a retired status license to active
status, a professional fiduciary must complete 15 hours of approved
continuing education courses.
5)Requires the Bureau to set fees by regulation for a retired and
inactive license, and to restore a license to active from a retired
or inactive status. The fees shall be set at the amount necessary
to cover the reasonable costs to carry out the functions of the
chapter.
6)Clarifies that the Bureau's authority to investigate any professional
fiduciary, with a restricted license, including, but not limited to,
a license that is retired, inactive, canceled, or suspended.
7)Makes technical, updating and conforming changes.
FISCAL EFFECT: This measure has been keyed "fiscal" by Legislative
Counsel. According to the Assembly Appropriations Committee analysis
dated April 30, 2014, there are minor and absorbable costs to the
Professional Fiduciaries Bureau.
COMMENTS:
1.Purpose. This bill is sponsored by the Author to revise the
Professional Fiduciaries Act to provide for a retired license
status. The bill also requires cancellation of a license that is
not renewed within three years, and makes other conforming and
clarifying changes. These changes are consistent with provisions in
other DCA board and bureau licensing acts that allow licensees to
select a "retired" status that would be reflected in public records.
The bill further clarifies the ability of the Bureau to investigate
the actions of any professional fiduciary, even if that person has a
retired, inactive, canceled, or suspended license.
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2.Background. A professional fiduciary is a person who acts as a
conservator of the person or estate, or guardian of the estate or
person, for two or more individuals at the same time who are not
related to the professional fiduciary or to each other. A
professional fiduciary is also someone who acts as a trustee, agent
under a durable power of attorney for health care, or agent under a
durable power of attorney for finances, for more than three
individuals, at the same time.
3.Retired Licenses. This bill allows the Bureau to adopt regulations
establishing a retired license. This license status would be for
individuals not actively engaged in the practice of a professional
fiduciary. A number of other DCA boards and bureaus permit a
similar license status, such as the Board of Accountancy, California
Architects Board, and the Dental Board of California.
4.Sunset Review of the Bureau. On March 17, 2014, the Senate Business,
Professions, and Economic Development Committee and the Assembly
Business, Professions and Consumer Protection Committee held a joint
sunset review hearing to hear testimony from the Bureau as to its
performance and the necessity for continuing its existence by
extending its sunset date.
The Sunset review report drafted by this Assembly Committee recommended
that the Bureau continue operations until the next review in 2019,
and in the meantime:
a) The Bureau should consider reducing fees sufficient to avoid
accumulating a 24 month reserve if the Bureau cannot get budget
authority to hire additional staff;
b) Brief the Legislature on the potential pool of new
professional fiduciaries and provide reasonable yearly targets
for attracting new licensees;
c) Discuss with the Legislature and the DCA whether to maintain
the Bureau independently if its current staffing and licensing
levels do not change.
1.Related Legislation. AB 1859 (Maienschein, 2014) authorizes
professional fiduciaries to organize as a professional corporation
under the Moscone-Knox Professional Corporation Act. ( Status : AB
1859 has been referred to Senate Judiciary Committee.)
AB 2741 (Bonilla, 2014) extends the sunset date on the Bureau from
January 1, 2015 to January 1, 2019. ( Status : AB 2741 has been
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referred to Senate Business, Professions and Economic Development
Committee and will be heard on June 23, 2014.)
SB 543 (Price, Chapter 488, Statutes of 2011) among other things,
extended the sunset date of the Bureau from 2012 to 2015.
SB 1550 (Figueroa, Chapter 491, Statutes of 2006) established the
Professional Fiduciaries Act, provided for the licensure and
regulation of professional fiduciaries; and created the Professional
Fiduciaries Bureau within the DCA.
2.Arguments in Support. The Professional Fiduciary Association of
California (PFAC) supports the provisions of the bill that updates
the Act to permit the Bureau to establish a "retired" and "inactive"
status for licensees, provided that licenses may not be renewed,
restored or reinstated after three years' expiration. PFAC states
that the Bureau does not currently have the statutory authority to
designate a license as "retired" or "inactive" or to cancel a
license for inactivity. "Under current practice, a professional
fiduciary who retires may either allow his or her license to become
delinquent, or continue to pay the renewal fee and complete the
required continuing education to keep the license active. License
status is public information, and 'delinquent' has a negative
connotation that some retired licensees would like to avoid,"
according to PFAC. The Board of Behavioral Sciences, the Board for
Professional Engineers, Land Surveyors and Geologists, the Dental
Board, and the Medical Board of California all have "retired" and
"inactive" license statuses. PFAC also supports the clarification
of the Bureau's ability to investigate the actions of any
professional fiduciary, even if that person has a retired, inactive,
canceled, or suspended license.
SUPPORT AND OPPOSITION:
Support:
Professional Fiduciary Association of California
Opposition:
None received as of June 11, 2014.
AB 2024
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Consultant:G. V. Ayers