The Contractors State License Law provides for the licensure and regulation of contractors by the Contractors State License Board, which is within the Department of Consumer Affairs. Existing law requires the board to appoint a registrar and requires the registrar, as specified, to publish a list of the names and addresses of contractors registered under that law.

This bill would require the board, prior to January 1, 2019, to add an enhancement to the current contractor license check search function that would permit consumers to search for a licensed contractor by either ZIP Code or geographic location.

The Contractors State License Law provides for the licensure and regulation of contractors by the Contractors State License Board, which is within the Department of Consumer Affairs. Existing law requires the board to appoint a registrar and requires the registrar, as specified, to publish a list of the names and addresses of contractors registered under that law.

This bill would require the board, prior to January 1, 2019, to add an enhancement to the current contractor license check search function that would permit consumers to search for a licensed contractor by either ZIP Code or geographic location.

The Contractors State License Law provides for the licensure and regulation of contractors by the Contractors State License Board, which is within the Department of Consumer Affairs. Existing law requires the board to appoint a registrar and requires the registrar, as specified, to publish a list of the names and addresses of contractors registered under that law.

This bill would authorize the board, when funds are available or during a scheduled update of the boards Internet Web site, would require the board, prior to January 1, 2019, to add an enhancement to the current contractor license check search function that would permit consumers to search for a licensed contractor by either ZIP Code or geographic location.

The Contractors State License Law provides for the licensure and regulation of contractors by the Contractors State License Board, which is within the Department of Consumer Affairs. Existing law requires the board to appoint a registrar and requires the registrar, as specified, to publish a list of the names and addresses of contractors registered under that law.

This bill would authorize the board, when funds are available or during a scheduled update of the boards Internet Web site, to add an enhancement to the current contractor license check search function that would permit consumers to search for a licensed contractor by either ZIP Code or geographic location.

The Contractors State License Law provides for the licensure and regulation of contractors by the Contractors State License Board, which is within the Department of Consumer Affairs. Existing law requires the board to appoint a registrar and requires the registrar, as specified, to publish a list of the names and addresses of contractors registered under that law.

This bill would authorize the board, when funds are available or during a scheduled update of the boards Internet Web site, to add an enhancement to the current contractor license check search function that would permit consumers to search for a licensed contractor by either ZIP Code or location.

 THIRD READING  

Bill No: AB 2486

Author:

:

Vote:

SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 6/20/16

AYES: Hill, Bates, Block, Gaines, Galgiani, Hernandez, Jackson, Mendoza, Wieckowski

SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/1/16

AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen

ASSEMBLY FLOOR: 67-0, 5/27/16 (Consent) - See last page for vote

SUBJECT:

SOURCE: Associated Builders and Contractors of California

DIGEST: This bill requires the Contractors State License Board, by January 1, 2019, to update its Web site to allow consumers to search for a licensed contractor by zip code or geographic locator.

ANALYSIS:

Existing law:

1. Creates the Contractors State License Board (CSLB), within the Department of Consumer Affairs, and provides that the protection of the public shall be its highest priority in exercising its licensing, regulatory, and disciplinary functions. (Business and Professions Code (BPC) § 7000; 7000.1)
2. Requires the CSLB to investigate complaints and enforce the provisions of the Contractors State License law, prohibit all forms of unlicensed activity, and enforce the obligation to secure the payment of valid and current workers’ compensation insurance in accordance with Section 3700.5 of the Labor Code. (BPC § 7011.4, 7011.7)
3. Defines “contractor” to include any person , consultant to an owner-builder, firm, association, organization, partnership, business, trust, corporation, or company, who or which undertakes, offers to undertake, purports to have the capacity to undertake, or submits a bid to construct any building or home improvement project, or part thereof. (BPC § 7026.1(a)(2)(A)))

This bill requires the Contractors’ State License Board, by January 1, 2019, to update its Web site to allow consumers to search for a licensed contractor by zip code or geographic locator.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

According to the Senate Appropriations analysis dated on August 1, 2016, this bill will incur “one-time costs of $90,000 to $100,000 to perform the required upgrades to the Board’s IT systems and website to allow geographic searching for licensed contractors (Contractors License Fund). Depending on the internal IT workload at the Board, the Board would either use its existing staff or contract out to make the necessary changes to meet the requirements of the bill.”

SUPPORT: (Verified 8/2/16)

Associated Builders and Contractors of California (source)

California Landscape Contractors Association

Sacramento Regional Builders Exchange

The California Pool and Spa Association

The Contractors State License Board

OPPOSITION: (Verified 8/2/16)

None received

ARGUMENTS IN SUPPORT: The Associated Builders and Contractors of California (Sponsor) underscore that, “More and more, Californians are asking for tools that help them find local sources for a variety of services in order to support their local communities. AB 2486 addresses that need by adding in a new tool for consumers to use to find local licensed contractors.”

ASSEMBLY FLOOR: 67-0, 5/27/16

AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker, Bigelow, Bonilla, Bonta, Burke, Calderon, Campos, Chang, Chau, Chávez, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Harper, Roger Hernández, Holden, Irwin, Jones, Kim, Lackey, Levine, Linder, Lopez, Maienschein, Mathis, Mayes, McCarty, Medina, Mullin, Nazarian, Obernolte, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon

NO VOTE RECORDED: Bloom, Brough, Brown, Chiu, Dodd, Eduardo Garcia, Grove, Hadley, Jones-Sawyer, Low, Melendez, O'Donnell, Ting

Prepared by:

8/8/16 10:23:14

**** END ****

SENATE COMMITTEE ON

Senator Ricardo Lara, Chair

2015 - 2016 Regular Session

AB 2486 (Baker) - Contractors’ State License Board: license search by location

This bill does not meet the criteria for referral to the Suspense File.

Bill Summary:

AB 2486 would require the Contractors State License Board to allow the public to search for a licensed contractor by zip code or geographic indicator.

Fiscal Impact:

One-time costs of $90,000 to $100,000 to perform the required upgrades to the Board’s IT systems and website to allow geographic searching for licensed contractors (Contractors License Fund). Depending on the internal IT workload at the Board, the Board would either use its existing staff or contract out to make the necessary changes to meet the requirements of the bill.

Background:

Under current law, the Contractors State License Board licenses and regulates contractors in the state, including both individuals and businesses. Under current law, any construction project that costs more than $500 must be performed by a licensed contractor. The Board currently licenses about 290,000 contractors.

Currently, members of the public can use the Board’s website to search for a contractor by personal name, business name, or license number – to ensure that a contractor is licensed and to view any disciplinary actions against a licensed contractor. Members of the public cannot search for licensed contractors in their area, because the Board’s website does not allow for searches based on location. The Board’s Strategic Plan includes an goal to develop a feature to allow searches for a contractor by geographic location, but the Board has not implemented that goal.

Proposed Law:

AB 2486 would require the Contractors State License Board to allow the public to search for a licensed contractor by zip code or geographic indicator.

The Board would be required to comply with this requirement by January 1, 2019.

-- END --

SENATE COMMITTEE ON

BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT

Senator Jerry Hill, Chair

2015 - 2016 Regular

Bill No: Hearing Date: June 20, 2016

Subject:

SUMMARY:

Requires the Contractors State License Board, by January 1, 2019, to update its website to allow consumers to search for a licensed contractor by zip code or geographic locator.

Existing law:

1. Creates the Contractors State License Board (CSLB), within the Department of Consumer Affairs, and provides that the protection of the public shall be its highest priority in exercising its licensing, regulatory, and disciplinary functions.
   (Business and Professions Code (BPC) § 7000; 7000.1)
2. Requires the CSLB to investigate complaints and enforce the provisions of the Contractors State License law, prohibit all forms of unlicensed activity, and enforce the obligation to secure the payment of valid and current workers’ compensation insurance in accordance with Section 3700.5 of the Labor Code. (BPC § 7011.4, 7011.7)
3. Defines “contractor” to include any person , consultant to an owner-builder, firm, association, organization, partnership, business, trust, corporation, or company, who or which undertakes, offers to undertake, purports to have the capacity to undertake, or submits a bid to construct any building or home improvement project, or part thereof. (BPC § 7026.1(a)(2)(A)))

This bill: Requires the Contractors’ State License Board, by January 1, 2019, to update its website to allow consumers to search for a licensed contractor by zip code or geographic locator.

FISCAL EFFECT:

This bill has been keyed “fiscal” by Legislative Counsel. According to the May 18, 2016 Assembly Appropriations Committee analysis, this bill would impose minor and absorbable costs to hire two internal IT staff to complete the custom programming changes to the CSLB’s IT system and website. The analysis notes that alternatively, CSLB could hire one person, with a higher salary. According the analysis, CSLB estimates the work proposed in this bill would take four to six months in either scenario.

COMMENTS:

1. Purpose. The Associated Builders and Contractors of California (ABC) is the Sponsor of this bill. According to the Author, “This bill will help combat the use of unlicensed contractors operating in the multi-billion dollar underground economy and will help further the Board’s mission of consumer protection by making it easier for consumers to get information about licensed contractors in their area. This bill also will support the Board’s 2015/2016 Strategic Plan recommendation to develop ways to make their website more user-friendly by providing a search by location function.”
2. Background. The CSLB is the regulatory entity responsible for licensing contractors and enforcing the Contractors State License Law. The mission of CSLB is to, “protect consumers by regulating the construction industry through policies that promote the health, safety, and general welfare of the public in matters relating to construction.” The CSLB licenses all businesses and individuals who construct or alter, or offer to construct or alter, any building, highway, road, parking facility, railroad, excavation, or other structure in California. The CSLB licenses approximately 290,000 contractors in 44 license classifications and two certifications. California requires licensed contractors to be used on any construction project that costs more than five hundred dollars. The CSLB currently collects information about its licensees that it in turn, publishes to its website.

Currently, the CSLB’s website only permits a consumer to search for a contractor by personal name, business name, or license number. The Author asserts that as a result, unless the consumer searching for a reputable licensed contractor already has a specific contractor’s name or license number, the consumer cannot fully and efficiently utilize the CSLB’s consumer protection resources. The CSLB has published a strategic plan for the current 2015/2016 fiscal year. Under the “Public Affairs Objectives”, the CSLB outlined a goal to add a licensee search feature to the CSLB’s website, similar to the feature proposed by this bill. The CSLB planned to have a schedule adopted by February of 2016, for the implementation of an opt-in “Find a Contractor” feature to help consumers locate nearby licensees. Currently, the project is still outstanding.

Under DCA, the Bureau of Private Postsecondary Education, Court Reporters Board, and the Cemetery and Funeral Bureau have a search by county feature. CSLB notes that, either under their current website or incorporation into BreEZe, the Board would disclosure licensee complaint or disciplinary information.

1. The Underground Economy. The CSLB has attested to the prevalence of unlicensed activity and an underground economy that affects the construction industry. Unscrupulous businesses are able to underbid law abiding businesses by failing to obtain required licenses and building permits, failing to pay payroll or other taxes, subverting insurance laws, and by various other means. When consumers do not use a licensed contractor, the consumer may be left with little recourse for fraud, financial losses, and incomplete or unsafe work. The CSLB currently combats this issue with various task forces, such as the Statewide Investigative Fraud Team. This bill aims to additionally mitigate the problem of an underground economy by making it easier for consumers to find contractors in good standing in the consumer’s local region.
2. Arguments in Support. The Associated Builders and Contractors of California (Sponsor) underscore that, “More and more, Californians are asking for tools that help them find local sources for a variety of services in order to support their local communities. AB 2486 addresses that need by adding in a new tool for consumers to use to find local licensed contractors.”

SUPPORT AND OPPOSITION:

Support:

The Associated Builders and Contractors of California (Sponsor)

California Landscape Contractors Association

The California Pool and Spa Association

The Contractors State License Board

Opposition:

None on file as of June 14, 2016.

-- END --

Date of Hearing: May 18, 2016

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez, Chair

ABPCA Bill Id:AB 2486

Author:(Baker) – As Amended Ver:April 25, 2016

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill requires the Contractors’ State License Board (Board), by January 1, 2019, to update its website to allow consumers to search for a licensed contractor by zip code or geographic locator.

FISCAL EFFECT:

The Board indicates minor and absorbable costs of approximately $90,000 (special fund) for two internal IT staff to complete the custom programming changes to the Board's IT system and website. Alternatively, the Board could use one IT consultant at a cost of approximately $100,000 (special fund). The Board estimates the work would take four to six months under either scenario.

COMMENTS:

1. Purpose. According to the author, “This bill will help combat the use of unlicensed contractors operating in the multi-billion dollar underground economy and will help further the Board’s mission of consumer protection by making it easier for consumers to get information about licensed contractors in their area. This bill also will support the Board’s 2015- 2016 Strategic Plan recommendation to develop ways to make their website more user-friendly by providing a search by location function.”
2. Background. The Board is the regulatory entity responsible for licensing contractors and enforcing the Contractors State License Law. Board licenses approximately 290,000 contractors in 44 license classifications and two certifications. California requires licensed contractors to be used on any construction project that costs more than five hundred dollars. The Board currently collects information about its licensees that it publishes to its website.

Currently, the Board’s website permits a consumer to search for a contractor by personal name, business name, or license number. The Board's 2015-2016 Strategic Plan outlines a goal to add a licensee search feature to the Board’s website, similar to the feature proposed by this bill. The Board planned to have a schedule adopted by February of 2016, for the implementation of an opt-in “Find a Contractor” feature to help consumers locate nearby licensees. The project is still outstanding.

Analysis Prepared by: Jennifer Swenson / APPR. / (916) 319-2081

Date of Hearing:

ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS

Rudy Salas, Chair

ABPCA Bill Id:AB 2486

Author:(Baker) – As Amended Ver:March 28, 2016

SUBJECT: Contractors’ State License Board: license search by location.

SUMMARY: Authorizes the Contractors’ State License Board (CSLB) to update its website to allow consumers to search for a licensed contractor by zip code or geographic locator.

EXISTING LAW:

1. Creates the CSLB, within the Department of Consumer Affairs, and provides that the protection of the public shall be its highest priority in exercising its licensing, regulatory, and disciplinary functions. (Business and Professions Code (BPC) Sections 7000, 7000.1)
2. Requires the CSLB to investigate complaints and enforce the provisions of the Contractors State License law, prohibit all forms of unlicensed activity, and enforce the obligation to secure the payment of valid and current workers’ compensation insurance in accordance with Section 3700.5 of the Labor Code. (BPC Sections 7011.4, 7011.7)
3. Defines “contractor” to include any person , consultant to an owner-builder, firm, association, organization, partnership, business, trust, corporation, or company, who or which undertakes, offers to undertake, purports to have the capacity to undertake, or submits a bid to construct any building or home improvement project, or part thereof. (BPC Section 7026.1(a)(2)(A)))

THIS BILL:

1. Authorizes the CSLB to add an enhancement to the current contractor license check search function that would permit consumers to search for a licensed contractor by zip code or location.
2. Provides that the CSLB may implement this feature when funds are available, or during a scheduled update of the boards Internet Website.

FISCAL EFFECT: Unknown. This bill is keyed fiscal by the Legislative Counsel.

COMMENTS:

Purpose. This bill is sponsored by the Associated Builders and Contractors of California (ABC). According to the author, “This bill will help combat the use of unlicensed contractors operating in the multi-billion dollar underground economy and will help further the Board’s mission of consumer protection by making it easier for consumers to get information about licensed contractors in their area. This bill also will support the Board’s 2015- 2016 Strategic Plan recommendation to develop ways to make their website more user-friendly by providing a search by location function.”

Background. The CSLB is the regulatory entity responsible for licensing contractors and enforcing the Contractors State License Law. The mission of CSLB is to, “protect consumers by regulating the construction industry through policies that promote the health, safety, and general welfare of the public in matters relating to construction.” The CSLB licenses all businesses and individuals who construct or alter, or offer to construct or alter, any building, highway, road, parking facility, railroad, excavation, or other structure in California. The CSLB licenses approximately 290,000 contractors in 44 license classifications and two certifications. California requires licensed contractors to be used on any construction project that costs more than five hundred dollars. The CSLB currently collects information about its licensees that it in turn, publishes to its website.

Currently, the CSLB’s website only permits a consumer to search for a contractor by personal name, business name, or license number. The author asserts that as a result, unless the consumer searching for a reputable licensed contractor already has a specific contractor’s name or license number, the consumer cannot fully and efficiently utilize the CSLB’s consumer protection resources. The CSLB has published a strategic plan for the current 2015/2016 fiscal year. Under the “Public Affairs Objectives”, the CSLB outlined a goal to add a licensee search feature to the CSLB’s website, similar to the feature proposed by this bill. The CSLB planned to have a schedule adopted by February of 2016, for the implementation of an opt-in “Find a Contractor” feature to help consumers locate nearby licensees. Currently, the project is still outstanding.

The Underground Economy. The CSLB has attested to the prevalence of unlicensed activity and an underground economy that affects the construction industry. Unscrupulous businesses are able to underbid law-abiding businesses by failing to obtain required licenses and building permits, failing to pay payroll or other taxes, subverting insurance laws, and by various other means. When consumers do not use a licensed contractor, the consumer may be left with little recourse for fraud, financial losses, and incomplete or unsafe work. The CSLB currently combats this issue with various task forces. This bill aims to additionally mitigate the problem of an underground economy by making it easier for consumers to find contractors in good standing in the consumer’s local region.

ARGUMENTS IN SUPPORT:

The Associated Builders and Contractors of California (ABC) writes, “More and more, Californians are asking for tools that help them find local sources for a variety of services in order to support their local communities. . . [This bill] will ask CSLB, in accordance with their 2015-2016 Strategic Plan, to include as part of their next scheduled website update, the ability for consumers to search for licensed contractors by zip code or location. This small policy change will also bolster local construction employment and further combat the use of unlicensed contractors operating in the underground economy.” ABC California also notes that other states including Arizona, Nevada, Oregon, and Texas already permit consumers to search for contractors by geographic location.

California Pool and Spa Association (CPSA) writes, “CPSA is in support of measures to try and stop the underground economy. The Berkeley Study, published in 2007 reports that in 2002, the California Department of Labor declared unreported labor in the state to be more than $100 billion [...] The main source of this underreporting is the construction industry. By reducing their overhead, [dishonest contractors] substantially underbid on projects [...] This means honest, licensed industry professionals lose market share and profits, compromising future business opportunities.”

IMPLEMENTATION ISSUE(S):

The CSLB asserts that it currently does not have a set implementation date for the geographic search feature, as it will require some additional information gathering and information technology work before it can be accomplished, but is still planning to move forward with this concept. The author may wish to designate a date, or allow the CSLB to designate a date by which this feature may be implemented.

AMENDMENT(S):

The author should amend the bill to add an implementation date as follows:

1. Page 2, in line 4, strike “scheduled update of the board’s Internet Web site,”, strike line 3 and insert:
2. 7018. By January 1, 2019, the board shall
3. Page 2, at the end of line 7 insert:
4. Prior to January 1, 2019, if funds are available or a scheduled update of the board’s Internet Web site allows for the addition of the enhancement described under this section, the board may add the enhancement.

REGISTERED SUPPORT:

The Associated Builders and Contractors of California (sponsor)

California Pool and Spa Association

Contractors State License Board

REGISTERED OPPOSITION:

None on file.

Analysis Prepared by: Tessa Nevarez / B. & P. / (916) 319-3301