CONSENT 

Bill No: AB 3087

Author: Brough (R)

Amended: 5/4/20 in Assembly

Vote: 21

SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 8/8/20

AYES: Glazer, Chang, Archuleta, Dodd, Galgiani, Hill, Leyva, Pan, Wilk

SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8

ASSEMBLY FLOOR: 76-0, 6/8/20 (Consent) - See last page for vote

SUBJECT: Contractors’ State License Law

SOURCE: Contractors State License Board

DIGEST:

This bill authorizes the Contractors State License Board (CSLB) to contract with a third-party vendor to administer licensing examinations.

ANALYSIS:

Existing law:

1. Establishes the CSLB within the Department of Consumer Affairs (DCA) to license and regulate contractors and home improvement salespersons. (Business and Professions Code (BPC) § 7000 et seq.)
   
2. Requires the CSLB registrar to investigate, classify, and qualify applicants for contractors’ licenses by written examination and specifies that the examination must include questions designed to show that the applicant has the necessary degree of knowledge relating to the laws of California and the contracting business and trade. (BPC § 7065(a))
3. Requires the CSLB to periodically review, and if needed, revise the contents of the qualifying examination(s) to ensure that the examination questions are timely and relevant; and requires the CSLB to construct and conduct examinations in such a manner as to preclude the possibility of any applicant having prior knowledge of any specific examination question. (BPC § 7065.05)
   

This bill authorizes the registrar to contract with a public or private organization to conduct or administer the examination and for materials or services related to the examination.

Background

Contractors State License Board. The CSLB is responsible for implementation and enforcement of the laws and regulations related to licensure and enforcement of construction related entities in California. Contractor licenses are classified within three basic branches of contracting as defined in the BPC and in the regulations of the CSLB. There are two general classifications (Class “A” and Class “B” licenses) and 42 specialty classifications (Class “C” licenses).

Applicants for a contractor’s license must pass a standard law and business examination; in addition, with the exception of the C-61 Limited specialty classification, they must pass a second test covering the specific trade or certification area for which they are applying. Currently, the CSLB is responsible for leasing testing centers throughout the state for the administration of its licensing examinations, including staffing those examination centers with proctors. There are a number of boards and bureaus that contract with outside vendors for the administration of licensing examinations.

Under BPC § 7065(a), the registrar is responsible to investigate, classify and qualify applicants for the examination, which the CSLB interprets to be prohibitive from contracting with a third-party vendor. This bill seeks to clarify that provision by authorizing the registrar to contract with a third-party vendor for examination services. The sponsors of this bill note that this may increase the number of testing days available to licensure applicants and may expand the locations of testing centers across the state.

According to information provided by the CSLB, it recently voted to join an existing DCA master contract (executed in 1998) with multiple other boards and bureaus who already contract with a third-party vendor for the administration of licensing examinations. Currently, the Office of Professional Examination Services under the DCA oversees the master contract for examination administration at computer-based testing centers throughout the United States. This bill allows the CSLB to participate in contracting-out those examination services.

FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No

SUPPORT: (Verified 8/17/20)

Contractors State License Board (source)

American Fire Sprinkler Association - California Chapters

American Fire Sprinkler Association - Sacramento Valley Chapter

Associated Builders and Contractors - Southern California Chapter

Associated General Contractors of California

Bay Area Builders Exchange

Builders Exchange of Santa Clara

Builders Exchange of Stockton

California Builders Alliance

California Legislative Conference of the Plumbing, Heating and Piping Industry

Central Coast Builders Association

Independent Roofing Contractors of California, INC.

Kern County Builders’ Exchange

National Electrical Contractors Association - California Chapters

Nevada County Contractors’ Association

North Coast Builders Exchange

Northern California Allied Trades

Painting & Decorating Contractors of California

Placer County Contractors' Association, Inc.

Plumbing-Heating-Cooling Contractors Association of California

Sacramento Regional Builders Exchange

San Luis Obispo County Builders Exchange

Southern California Glass Management Association

Tulare Kings Counties Builders Exchange

United Contractors

Valley Contractors Exchange

Ventura County Contractors Association

Wall and Ceiling Alliance

Western Wall & Ceiling Contractors Association

Two individuals

OPPOSITION: (Verified 8/17/20)

None received

ARGUMENTS IN SUPPORT: Supporters note that this bill will greatly increase testing opportunities.

ASSEMBLY FLOOR: 76-0, 6/8/20

AYES: Aguiar-Curry, Arambula, Bauer-Kahan, Berman, Bigelow, Bloom, Boerner Horvath, Bonta, Brough, Burke, Calderon, Carrillo, Cervantes, Chau, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Megan Dahle, Daly, Diep, Eggman, Flora, Fong, Frazier, Friedman, Gabriel, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez, Gray, Grayson, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager, Kiley, Lackey, Levine, Limón, Maienschein, Mathis, Mayes, McCarty, Medina, Mullin, Nazarian, Obernolte, O'Donnell, Patterson, Petrie-Norris, Quirk-Silva, Ramos, Reyes, Luz Rivas, Robert Rivas, Rodriguez, Blanca Rubio, Salas, Santiago, Smith, Mark Stone, Ting, Voepel, Waldron, Weber, Wicks, Wood, Rendon

NO VOTE RECORDED: Low, Muratsuchi, Quirk

Prepared by: Elissa Silva / B., P. & E.D. / 916-651-4104

8/19/20 10:57:30

**** END ****

SENATE COMMITTEE ON

BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT

Senator Steven Glazer, Chair

2019 - 2020 Regular

Bill No: Hearing Date: August 8, 2020

Subject:

SUMMARY:

Authorizes the Contractors State License Board (CSLB) to contract with a third-party vendor to administer licensing examinations.

Existing law:

1. Establishes the Contractors State License Board (CSLB) within the Department of Consumer Affairs (DCA) to license and regulate contractors and home improvement salespersons. (Business and Professions Code (BPC) § 7000 et seq.)
   
2. Requires the CSLB registrar to investigate, classify, and qualify applicants for contractors’ licenses by written examination and specifies that the examination must include questions designed to show that the applicant has the necessary degree of knowledge relating to the laws of California and the contracting business and trade. (BPC § 7065(a))
3. Requires contractors’ licenses to be issued to individual owners, partnerships, corporations, and limited liability companies, as specified. (BPC § 7065.(b))
   
4. Requires the CSLB to periodically review, and if needed, revise the contents of the qualifying examination(s) to ensure that the examination questions are timely and relevant; and requires the CSLB to construct and conduct examinations in such a manner as to preclude the possibility of any applicant having prior knowledge of any specific examination question. (BPC § 7065.05)
   
5. Authorizes the registrar to waive the examination requirement for a contractors’ license under specified circumstances. (BPC § 7065(d))

This bill authorizes the registrar to contract with a public or private organization to conduct or administer the examination and for materials or services related to the examination.

FISCAL EFFECT:

This bill is keyed fiscal by Legislative Counsel. According to the Assembly Committee on Appropriations, this bill will result in savings of approximately $600,000 to CSLB.

COMMENTS:

1. Purpose. This bill seeks to allow the CSLB to contract with a third-party vendor for purposes of administering licensing examinations instead of the CSLB being the administrator. This bill is sponsored by the Contractors State License Board. According to the author, “not only will the option to contract with a third-party vendor for examination administration would save CSLB approximately $624,000 a year, it would greatly increase testing opportunities for applicants. The number of testing centers available to applicants would extend from [eight] in California only, to 17 in California and an additional 22 out of state. Exam scheduling days would go from 4 or 5 days per week during business hours only to 5 to 6 days per work including evening hours. Examinations would be schedulable through 24-hour services online as opposed to currently, which is by phone during business hours only.”
2. Background.

Contractors State License Board. The CSLB is responsible for implementation and enforcement of the laws and regulations related to licensure and enforcement of construction related entities in California. 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 must be licensed by the CSLB if the total cost (labor and materials) of one or more contracts on the project is $500 or more. Contractor licenses are classified within three basic branches of contracting as defined in the BPC and in the regulations of the CSLB. There are two general classifications (Class “A” and Class “B” licenses) and 42 specialty classifications (Class “C” licenses).

Licensing and Examination Process and Requirements. Applicants for a contractor’s license must pass a standard Law and Business examination; in addition, with the exception of the C-61 Limited specialty classification, they must pass a second test covering the specific trade or certification area for which they are applying. Currently, the CSLB is responsible for leasing testing centers throughout the state for the administration of its licensing examinations, including staffing those examination centers with proctors. There are a number of boards and bureaus that contract with outside vendors for the administration of licensing examinations.

Under BPC § 7065(a), the registrar is responsible to investigate, classify and qualify applicants for the examination, which the CSLB interprets to be prohibitive from contracting with a third-party vendor. This bill seeks to clarify that provision by authorizing the registrar to contract with a third-party vendor for examination services. The sponsors of this bill note that this may increase the number of testing days available to licensure applicants and may expand the locations of testing centers across the state.

According to information provided by the CSLB, it recently voted to join an existing DCA master contract (executed in 1998) with multiple other boards and bureaus who already contract with a third-party vendor for the administration of licensing examinations. Currently, the Office of Professional Examination Services under the DCA oversees the master contract for examination administration at computer-based testing centers throughout the United States. This bill would allow the CSLB to participate in contracting out those examination services.

1. Arguments in Support. The Contractors State License Board writes in support, “Many Department of Consumer Affairs boards and bureaus already contract with third party agencies to administer their examinations. The Board does not have this authority due to the existing language in Business and Professions Code § 7065. This bill borrows existing language from other boards that have this authority, to authorize third party administration of the Board’s examinations. The Board will continue to develop its examinations.”

Plumbing-Heating-Cooling Contractors Association of California (CAPHCC), the Independent Roofing Contractors of California, the California Chapters of the American Fire Sprinkler Association (AFSA), the Associated Builders and Contractors – Southern California Chapter and the Western Electrical Contractors Association, writes in support, “Allowing CSLB to contract with a third-party vendor for examination administration would potentially save CSLB (which is supported by fees paid by contractors) approximately $624,000 a year and would greatly increase testing opportunities for applicants.”

Sacramento Regional Builders Exchange, Placer County Contractors' Association, Inc, Builders Exchange of Stockton, SLO County Builders Exchange, Nevada County Contractors’ Association, Kern County Builders’ Exchange, Ventura County Contractors Association, Tulare Kings Counties Builders Exchange, and Builders Exchange of Santa Clara Bay Area Builders Exchange, write in support, “AB 3087 will allow CSLB the ability to contract with a third-party vendor to administer examinations. By doing so, applicants would benefit by having more testing centers available to them resulting in less miles traveled; the option of selecting examinations on the weekends and evenings; and more options for translation assistance.”

SUPPORT AND OPPOSITION:

Support:

Contractors State License Board (sponsor)

Associated Builders and Contractors - Southern California Chapter

Bay Area Builders Exchange

Builders Exchange of Santa Clara

Builders Exchange of Stockton

California Chapter - American Fire Sprinkler Association

Independent Roofing Contractors of California, INC.

Kern County Builders’ Exchange

Nevada County Contractors’ Association

Placer County Contractors' Association, Inc.

Plumbing-heating-cooling Contractors Association of California

Sacramento Regional Builders Exchange

Sacramento Valley Chapter - American Fire Sprinkler Association

SLO County Builders Exchange

Tulare Kings Counties Builders Exchange

Ventura County Contractors Association

Western Electrical Contractors Association

Two individuals

Opposition:

None on file

-- END --

Date of Hearing: June 2, 2020

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez, Chair

ABPCA Bill Id:AB 3087

Author:(Brough) – As Amended Ver:May 4, 2020

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

SUMMARY:

This bill authorizes the Contractors State License Board’s (CSLB) to contract with a public or private organization to administer its licensing examinations and to contract for materials and services related to the exams.

FISCAL EFFECT:

Annual expenditure savings of approximately $600,000 (Contractors License Fund) to CSLB. CSLB indicates current in-house examination administration costs of $3.2 million annually ($73 per exam), and third-party vendor contracting costs would be approximately $2.6 million annually ($59 per exam), resulting in a $600,000 annual expenditure savings. The cost to the individual applicant, set by statute, would not change.  

COMMENTS:

1. Purpose. This bill seeks to improve exam access for CSLB licensing applicants by clarifying CSLB’s authority to contract with third-party vendors. CSLB indicates contracting out its examination services will allow it to increase the number of test centers in the state, expand examination schedules to include evenings and weekend exam times, improve translator services and provide enhanced examination oversight and security.
2. Background. The Department of Consumer Affairs (DCA) has an existing master contract (executed in 1998) allowing multiple boards and bureaus under its purview to contract with third-party vendors for the administration of licensing examinations. The CSLB Board recently voted to join the existing contract. This bill clarifies CSLB’s authority to allow a third party to administer its exams.

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

Date of Hearing:

ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS

Evan Low, Chair

ABPCA Bill Id:AB 3087

Author:(Brough) – As Amended Ver:May 4, 2020

SUBJECT: Contractors’ State License Law.

SUMMARY: Clarify Contractors’ State License Board’s (CSLB) authority to contract with a third-party vendor for the administration of its licensing examinations.

EXISTING LAW:

1. States that licensing boards and bureaus constituted within the Department of Consumer Affairs would develop or administer license examinations, or provide for development or administration of a licensing examinations pursuant to contract with a public or private entity. (Business and Professions Code (BPC) § 139 subdivision (d).
2. Provides that the DCA director may negotiate and execute contracts for examination purposes on behalf of boards and bureaus. (BPC § 156)
3. Establishes the Contractors State License Board (CSLB) to license and regulate contractors and home improvement salespersons. (Business and Professions Code (BPC) § 7000 et seq.)
4. Provides that the CSLB registrar investigate, classify, and qualify applicants for contractors’ licenses by written examination. Provides that the examination include questions designed to show that the applicant has the necessary degree of knowledge required by the Contractors State License Law and shall include pertinent questions relating to the laws of this state and the contracting business and trade. (BPC § 7065)
5. Requires the board to periodically review or revise the contents of qualifying examinations to insure that the examination questions are timely and relevant to the business of contracting. (BPC § 7065)

THIS BILL:

1. Provides that the registrar may contract with a public or private organization to conduct or administer the examination.
2. Provides that the registrar may contract with a public or private organization for materials or services related to the examination.

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

COMMENTS:

Purpose. This bill is sponsored by the Contractors State License Board. According to the Author,” [This bill] will aide in greater customer service; as applicants will receive more translator assistance and enhanced examination oversight and security. Applicants will have more test centers to choose from, reducing travel for many, and applicants will be able to schedule examinations on more days (Saturdays and in the evening). The CSLB currently administers examinations “in-house” as is with annual costs of approximately $3.2 million, or $73 per exam. Contracting with a third-party vendor would result in annual costs of approximately $2.6 million, or $59 per exam. While the cost to individual applicants, which is set by statute, would not change; this legislative change will ease scheduling and traveling burdens that currently exist for applicants, which is economic in nature. For example, all licensing examination candidates living north of Sacramento would no longer have to travel to examinations, as Sacramento is the northern most California territory CSLB currently serves.”

Background.

According to the CSLB, it is relatively unique in the development and administration of its own exams. Licensing agencies throughout the country already use national testing services such as the service with which CSLB seeks to contract.

The CSLB sponsored this bill after a recent meeting at which the Board voted to join an existing DCA master contract (executed in 1998) with multiple boards and bureaus who already contract with a third-party vendor for the administration of licensing examinations. However, its legal counsel informed staff that due to the CSLB statute requiring the registrar to “investigate, classify, and qualify applicants for contractors’ licenses by written examination,” the authority to have anyone other than the registrar administer the licensing examinations is not clear.

Prior Related Legislation. SB 1476 (Figueroa), (Chaptered by Secretary of State Chapter - 658, Statutes of 2006). This sunset bill from 2006 extended Board for Professional Engineers and Land Surveyors and addressed technical changes to continue the Board as well as adding BPC § 8745 and BPC § 6754, which state that examination for licensure shall be held at such times and places as the board shall determine. The second division of the examination for all branches specified in BPC § 6732 shall be administered at least once each year.

Work of the board relating to examination and licensure may be divided into committees as the board shall direct. The scope of examinations and the methods of procedure may be prescribed by board rule. The board may make arrangements with a public or private organization to conduct the examination. The board may contract with a public or private organization for materials or services related to the examination.

SB 1080 (Committee on Business and Professions), (Chaptered by Secretary of State - Chapter 807, Statutes of 2003). Established BPC § 5082.1 which states the examination required by the board for the granting of a license as a certified public accountant may be conducted by the board or by a public or private organization specified by the board. The examination may be conducted under a uniform examination system.

Also, the board may make arrangements with a public or private organization for the conduct of the examination, as deemed necessary by the board. The board may contract with a public or private organization for materials or services related to the examination.

ARGUMENTS IN SUPPORT:

According to CSLB, “In addition to saving the CSLB over half a million dollars per year, the bill has a customer service element; applicants will receive more translator assistance and enhanced examination oversight and security. They will have more test centers to choose from, reducing travel for many, and applicants will be able to schedule examinations on more days (Saturdays and in the evening).”

ARGUMENTS IN OPPOSITION:

None on file.

REGISTERED SUPPORT:

Contractors State License Board (Sponsor)

Sacramento Regional Builders Exchange

Placer County Contractors' Association, Inc.

Builders Exchange of Stockton

SLO County Builders Exchange

Nevada County Contractors’ Association

Kern County Builders’ Exchange

Ventura County Contractors Association

Tulare Kings Counties Builders Exchange

Builders Exchange of Santa Clara

Bay Area Builders Exchange

Valley Contractors Exchange

North Coast Builders Exchange

Central Coast Builders Association

California Chapters of the National Electrical Contractors Association (NECA)

California Legislative Conference of the Plumbing, Heating and Piping Industry (CLC)

Northern California Allied Trades

Southern California Glass Management Association

United Contractors

Associated General Contractors of California

Wall and Ceiling Alliance (WACA)

Western Wall & Ceiling Contractors Association

Flasher Barricade Association

REGISTERED OPPOSITION:

None on file.

Analysis Prepared by: Danielle Sires / B. & P. / (916) 319-3301