The Contractors State License Law provides for the licensure and regulation of contractors by the Contractors State License Board (board), which is within the Department of Consumer Affairs.

(1)Under existing law, the board is responsible for the licensure and regulation of contractors and the board is required to appoint a registrar of contractors. Existing law repeals these provisions establishing the board and requiring it to appoint a registrar on January 1, 2020.

This bill would extend the operation of these provisions to January 1, 2024.

Existing law requires the board to meet once each calendar quarter for the purpose of transacting business that comes before it. 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, including a license check search function that would permit consumers to search for a licensed contractor by either ZIP Code or geographic location. Existing law requires an applicant or licensee to file or have on file a contractors bond in the sum of $15,000.

This bill would require the board to maintain the contractor search function on the boards internet website. The bill would require the board to conduct a study and report to the Legislature regarding whether the current amount of the contractors bond requirement is sufficient. The bill would also require the board to make every effort to provide a webcast of all regularly scheduled quarterly meetings of the board, as specified.

(2)Existing law provides that authorized representatives of the United States government, the State of California, and other specified agencies and entities are exempt from the provisions of the Contractors State License Law, except as specified.

This bill would make a nonsubstantive change to these provisions.

(3)Existing law requires the registrar to make available to members of the public the date, nature, and status of all complaints on file against a licensee that meet specific qualifications. Under existing law, complaints resolved in favor of the contractor are not subject to disclosure. For legal actions against a licensee that require disclosure, existing law requires the disclosure to also appear on the license of record identified as a qualifier who is listed in the members of the personnel of record of the licensee issued the citation.

This bill would make clarifying changes to these provisions relating to legal actions that require disclosure of disciplinary action against a licensee.

(3)Existing law authorizes the board to set fees by regulation, according to a prescribed schedule, including an authorization to charge C-10 and C-7 contractors a fee, not to exceed $20, to be used by the board to enforce provisions of the Labor Code relating to electrician certification.

This bill would instead require the board to only charge C-10 contractors a $20 fee, which would be assessed with the renewal fee for an active license, for that purpose.

(4)Existing law requires, as a condition precedent to the board accepting an application for licensure, renewal, reinstatement, or to change officers or other personnel of record, that an applicant, previously found to have failed or refused to pay a contractor, subcontractor, consumer, materials supplier, or employee based on an unsatisfied final judgment, file or have on file with the board a bond sufficient to guarantee payment of an amount equal to the unsatisfied final judgment or judgments. Under existing law, if a judgment is entered against a licensee, then a qualifying person or personnel of record is prohibited from serving as a qualifying individual or other personnel of record on any license until the judgment is satisfied.

This bill would extend that prohibition to when a judgment is entered against any personnel of record.

(5)Existing law requires the board to receive and review complaints and consumer questions, and complaints received from state agencies, regarding solar energy systems companies and solar contractors. Existing law requires the board to annually compile a report documenting complaints it received relating to solar contractors that it shall make available publicly on the boards and the Public Utilities Commissions internet websites.

This bill would make nonsubstantive changes to these provisions.

 UNFINISHED BUSINESS  

Bill No: SB 610

Author: Glazer (D)

Amended: 6/25/19

Vote: 21

SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 4/22/19

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

SENATE APPROPRIATIONS COMMITTEE: 6-0, 5/16/19

AYES: Portantino, Bates, Bradford, Hill, Jones, Wieckowski

SENATE FLOOR: 38-0, 5/21/19

AYES: Allen, Archuleta, Atkins, Bates, Beall, Borgeas, Bradford, Caballero, Chang, Dodd, Durazo, Galgiani, Glazer, Grove, Hertzberg, Hill, Hueso, Hurtado, Jackson, Jones, Leyva, McGuire, Mitchell, Monning, Moorlach, Morrell, Nielsen, Pan, Portantino, Roth, Rubio, Skinner, Stern, Stone, Umberg, Wieckowski, Wiener, Wilk

ASSEMBLY FLOOR: 78-0, 9/10/19 - See last page for vote

SUBJECT: Contractors: licensing and regulation

SOURCE: Author

DIGEST:

This bill extends the sunset date of the Contractors State License Board (CSLB) and its authority to appoint a registrar until January 1, 2024; requires the CSLB to conduct a study of the contractor bond; and, makes other technical and clarifying changes to the Contractors’ State License Law (Contractors’ Law).

Assembly Amendments

require the study of the contractor bond to be completed by January 1, 2021, instead of January 1, 2024; clarify that the electrician certification fee is charged at renewal; and, make other technical and clarifying changes.

ANALYSIS:

Existing law:

1. Establishes the CSLB under the Department of Consumer Affairs (DCA) to license and regulate contractors and home improvement salespersons and sunsets the CSLB and its authority to appoint a registrar on January 1, 2020. (Business and Professions Code (BPC) § 7000 et seq.)
2. Requires the CSLB to add an enhancement to the current contractor license check search function that permits consumers to search for a licensed contractor by either ZIP Code or geographic location. (BPC § 7018)
3. Requires the CSLB, in collaboration with the Public Utilities Commission, to develop and make available a solar disclosure document, as specified. (BPC 7169(a))
4. Requires, as a condition of licensure, renewal, reinstatement, or reactivation of a license that the applicant file or have on file a contractor’s bond in the sum of $15,000, as specified. (BPC § 7071.6)
5. Prohibits the qualifying person, any partner of the licensee, or personnel of the licensee named as a judgment debtor in an unsatisfied final judgment, from serving as an officer, director, associate, partner, owner, manager, qualifying individual, or other personnel of record of another licensee. (BPC § 7071.17(j))
6. Requires persons who perform work as electricians to become certified and prohibits uncertified persons from performing electrical work for which certification is required and specifies that certification is required only for those persons who perform work as electricians for contractors licensed as class C-10 electrical contractors under the CSLB’s rules and regulations. (Labor Code (LC) §108.2(a)(b)(1))

This bill:

1. Extends the sunset date of the CSLB and the CSLB’s authority to appoint a registrar by four years, until January 1, 2024.
2. Requires the CSLB to conduct a study to obtain information to evaluate whether the current $15,000 amount of the contractor bond is sufficient or whether an increase may be necessary and report back to the Legislature by January 1, 2021.
3. Extends the prohibition of qualifying person or personnel of record from serving as a qualifying individual or other personnel of record on any license until the judgment is satisfied when a judgment is entered against any personnel of record.
4. Requires, instead of authorizing the CSLB, to charge a fee of no more than $20 to enforce specified provisions of the LC at renewal.
5. Makes other technical and clarifying changes.

Background

CSLB is responsible for the implementation and enforcement of the Contractors’ Law (the laws and regulations related to the licensure, practice and discipline of the construction industry 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, including both labor and materials, of one or more contracts on the project is $500 or more.

Sunset Review Oversight. Beginning in 2018, the Senate Business, Professions and Economic Development Committee and the Assembly Business and Professions Committee (Committees) began their comprehensive sunset review oversight of 10 regulatory entities and the DCA. This bill makes numerous changes to the Contractors Law as a result of the Board’s 2018 sunset review report and its subsequent participation in a sunset review hearing on February 26, 2019.

Electrician certification. BPC Section 7137 authorizes the CSLB to charge a fee, not to exceed $20, for C-10 (Electrician) and C-7 (Low Voltage Systems) licensees for enforcement of the electrician certification requirement as specified in LC Section 108.2. LC Section 108.2(a) requires persons who perform work as electricians to become certified. Additionally, it prohibits uncertified persons from performing electrical work for which certification is required and specifies that certification is only required for persons who perform work as electricians for contractors licensed as C-10 electrical contractors.

The CSLB is responsible for ensuring that C-10 employees meet the certification requirements. According to the CSLB, there are approximately 30,500 active C-10 contractors and if they use employees as prescribed in LC Section 108.2, the CSLB must ensure that those employees are certified. The CSLB reports that it does not have sufficient staff resources allotted to ensure compliance with the LC requirement. As a result, the CSLB acknowledges that it does not effectively enforce this requirement. The CSLB has the statutory authority to charge the fee, but would need regulations to implement its authority. The regulatory process is currently under review, as it may take multiple years for the appropriate issuance of new regulations. This bill requires the CSLB to collect the fee in order to ensure compliance with the required electrician certification.

Unsatisfied judgements. Under current law, the CSLB has the authority to suspend a license if it learns of an unsatisfied construction related judgment imposed on a licensee, as specified in BPC Section 7071.17. When the CSLB suspends a license for failure to pay an outstanding judgement, any qualifying individual or personnel on the license record is automatically prohibited from serving in those capacities on another license until the judgment is satisfied. This prohibition also causes suspension of the license of any other license entity with any of these same personnel as the license subject to the judgment (until those members disassociate from the license or the judgment is satisfied). Therefore, when a judgment is imposed on a license, the suspension extends to individuals associated with the judgment debtor license and other licenses. However, the reverse is not true: If a judgment is entered against an individual without naming the licensed entity, the statutory language does not authorize CSLB to suspend the license on which the individual appears. As a result, an individual named on a construction-related judgment can remain on a license. The proposed clarifying change to BPC Section 7071.17 would preclude license applicants, if they were subject to an unsatisfied final judgment, from becoming licensed until that judgment is satisfied. Additionally, it would preclude an individual named in an unsatisfied judgment from appearing on an active license until the judgment is satisfied.

Contractors bond. Current law (BPC § 7071.6), as a condition of issuance, renewal, reinstatement, reactivation or continued maintenance of a license, an applicant is required to file or have on file with the CSLB a contractor’s bond in the amount of $15,000. During the CSLB’s 2016 sunset review, the amount of the contractor’s bond was raised from $12,500 to $15,000. During the CSLB’s February 26, 2019 sunset review hearing, the sufficiency of the current bond was questioned. To further investigate whether or not the current $15,000 is sufficient or not, this bill will require the CSLB to conduct a study to obtain information to evaluate if the current $15,000 bond amount is sufficient, or whether an increase may be necessary by January 1, 2021.

Technical changes. As noted in the CSLB’s 2019 Committees staff Background Paper, there may be a number of non-substantive and technical changes to the contractors’ law, which may improve efficiencies. As a result, this bill makes other technical and clarifying changes to assist in improving efficiencies for the CSLB to operate its licensing and regulatory processes. This bill extends the sunset date of the CSLB by four years and its authority to appoint a registrar, until January 1, 2024.

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

According to the Assembly Appropriations Committee, this bill will result in annual ongoing special fund expenditures of approximately $67 million to extend the CSLB beyond the January 1, 2020, sunset date, an additional $500,000 in revenue from the $20 fee for C-10 contractors, and minor and absorbable costs associated with other provisions in this bill.

SUPPORT: (Verified 9/9/19)

Associated Builders and Contractors of Northern California

Contractors State License Board

OPPOSITION: (Verified 9/9/19)

None received

ASSEMBLY FLOOR: 78-0, 9/10/19

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, Daly, Diep, Eggman, Flora, Fong, Frazier, Friedman, Gabriel, Gallagher, Cristina Garcia, Eduardo Garcia, Gipson, Gloria, Gonzalez, Gray, Grayson, Holden, Irwin, Jones-Sawyer, Kalra, Kamlager-Dove, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, 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: Petrie-Norris

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

9/10/19 22:05:40

**** END ****

SENATE THIRD READING

STR Bill Id:SB 610

Author:(Glazer)

As Amended Ver:June 25, 2019

Majority vote

SUMMARY:

This bill extends the sunset date for the Contractors' State License Board (CSLB), from January 1, 2020, to January 1, 2024, and makes several changes recommended through the sunset review process. Those changes include requiring the CSLB to conduct a study of the contractor bond to determine if the amount is sufficient and to report its findings to the Legislature by January 1, 2021, and requiring (rather than allowing) CSLB to charge C-10 contractors a $20 annual fee, assessed with the renewal fee for an active license, to better enforce existing provisions related to electrician certification.

Major Provisions

1. Extends the sunset date of the CSLB and the CSLB's authority to appoint a registrar by four years, until January 1, 2024.
2. Requires the CSLB to conduct a study to obtain information to evaluate whether the current $15,000 amount of the contractor bond is sufficient or whether an increase may be necessary and report back to the Legislature by January 1, 2024.
3. Extends the prohibition of qualifying person or personnel of record from serving as a qualifying individual or other personnel of record on any license until the judgment is satisfied when a judgment is entered against any personnel of record.
4. Requires, instead of authorizing the CSLB, to charge a fee of no more than $20 to enforce specified provisions of the Labor Code.

5) Makes other technical and clarifying changes.

COMMENTS:

Contractors' State License Law (the laws and regulations related to the licensure, practice and discipline of the construction industry 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, including both labor and materials, of one or more contracts on the project is $500 or more.

As noted in the CSLB's 2018 Committee staff Background Paper, the safety and welfare of consumers persists under the presence of a strong licensing and regulatory structure to oversee the contractor profession. The CSLB's focus is consumer protection, to that end, has demonstrated its commitment to ensuring a robust contractor market place. Although, there are places where the CSLB can improve, including fiscal prudence, strengthening its licensing and enforcement objectives and those respective programmatic units, and identifying legislative priorities sooner, the CSLB should continue with a four-year sunset date. This bill extends the sunset date of the CSLB by four years and its authority to appoint a registrar, until January 1, 2024.

According to the Author:

According to the Author, "[This bill] is necessary to reflect Committee staff recommendations made for the purpose of remedying issues identified through the CSLB's Sunset Review process. This measure is one of five "sunset bills" the Author is sponsoring this year. This bill is necessary to make changes to the contractors' law and CSLB operations in order to improve the effectiveness and efficiency of this regulatory entity."

Arguments in Support:

The Associated Builders and Contractors of Northern California writes in support, "Because we recognize the importance of a well-regulated industry to promote safety and compliance, ABC Nor Cal is pleased to support the bill and urge your 'Aye' vote. In particular, we are pleased to support urging the CSLB to webcast its meetings."

Arguments in Opposition:

None on file.

FISCAL COMMENTS:

According to the Assembly Appropriations Committee,

1. Annual ongoing special fund expenditures of approximately $67 million (Contractors License Fund) to extend the CSLB beyond the January 1, 2020, sunset date. This fund is self-supporting with fees.
2. The CSLB estimates an additional $500,000 (Contractors License Fund) in revenue from the $20 fee for C-10 contractors.
3. The CSLB indicates all other costs associated with this bill will be minor and absorbable.

VOTES:

SENATE FLOOR: 38-0-0

YES: Allen, Archuleta, Atkins, Bates, Beall, Borgeas, Bradford, Caballero, Chang, Dodd, Durazo, Galgiani, Glazer, Grove, Hertzberg, Hill, Hueso, Hurtado, Jackson, Jones, Leyva, McGuire, Mitchell, Monning, Moorlach, Morrell, Nielsen, Pan, Portantino, Roth, Rubio, Skinner, Stern, Stone, Umberg, Wieckowski, Wiener, Wilk

ASM BUSINESS AND PROFESSIONS: 19-0-0

YES: Low, Brough, Arambula, Bloom, Chen, Chiu, Cunningham, Eggman, Fong, Gipson, Gloria, Grayson, Holden, Irwin, McCarty, Medina, Mullin, Obernolte, Ting

ASM APPROPRIATIONS: 18-0-0

YES: Gonzalez, Bigelow, Bloom, Bonta, Brough, Calderon, Carrillo, Chau, Diep, Eggman, Fong, Gabriel, Eduardo Garcia, Maienschein, Obernolte, Petrie-Norris, Quirk, Robert Rivas

UPDATED:

VERSION: June 25, 2019

CONSULTANT: Danielle Sires / B. & P. / (916) 319-3301 FN: 0001607

Date of Hearing: August 14, 2019

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez, Chair

SBPCA Bill Id:SB 610

Author:(Glazer) – As Amended Ver:June 25, 2019

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

SUMMARY:

This bill extends the sunset date for the Contractors' State License Board (CSLB), from January 1, 2020, to January 1, 2024, and makes several changes recommended through the sunset review process. Those changes include requiring the CSLB to conduct a study of the contractor bond to determine if the amount is sufficient and to report its findings to the Legislature by January 1, 2021, and requiring (rather than allowing) CSLB to charge C-10 contractors a $20 annual fee, assessed with the renewal fee for an active license, to better enforce existing provisions related to electrician certification.

FISCAL EFFECT:

1. Annual ongoing special fund expenditures of approximately $67 million (Contractors License Fund) to extend the CSLB beyond the January 1, 2020, sunset date. This fund is self-supporting with fees.
2. The CSLB estimates an additional $500,000 (Contractors License Fund) in revenue from the $20 fee for C-10 contractors.
3. The CSLB indicates all other costs associated with this bill will be minor and absorbable.

COMMENTS:

1. Purpose. This bill seeks to implement recommendations identified through the CSLB’s sunset review process, including extending the sunset date of the CSLB by four years. According to the author, “This bill is necessary to make changes to the contractors’ law and CSLB operations in order to improve the effectiveness and efficiency of this regulatory entity.”
2. Contractors' State Licensing Board. The CSLB, within the Department of Consumer Affairs (DCA), is responsible for the implementation and enforcement of the Contractors State License Law, including the laws and regulations related to the licensure, practice and discipline of the construction industry 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. The CSLB licenses approximately 285,000 contractors in 44 license classifications and two certifications, and registers an additional 18,000 home improvement salespersons engaged in the sale of home improvement goods and services. Existing law provides for a sunset of the CSLB on January 1, 2020, which provides for continued legislative oversight of the board’s regulatory activities.

This bill makes numerous changes to the Contractors State License Law as a result of the CSLB’s 2018 sunset review report and its subsequent participation in the Assembly Business and Professions Committee and the Senate Business, Professions and Economic Development Committee joint sunset review hearing on February 26, 2019.

1. Prior Legislation. AB 467 (Hill), Chapter 656, Statues of 2015, extended the sunset date for the CSLB until January 1, 2020, and revised the financial security requirements placed on contractors, among other issues.
2. Related Legislation. This bill is one of nine measures introduced this session to extend the sunset on licensing boards within DCA. The others include SB 607 (Glazer), pending with the Assembly Business and Professions Committee, SB 606 (Glazer), SB 608 (Glazer) and SB 609 (Glazer), pending with this committee. The Assembly bills include AB 1520 (Low), AB 1521 (Assembly Committee on Business and Professions), AB 1522 (Low) and AB 1523 (Low). All are pending in the Senate Appropriations Committee.

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

Date of Hearing: July 9, 2019

ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS

Evan Low, Chair

SBPCA Bill Id:SB 610

Author:(Glazer) – As Amended Ver:June 25, 2019

SENATE VOTE: 38-0

SUBJECT: Contractors: licensing and regulation

SUMMARY: Extends the sunset date of the Contractors State License Board (CSLB) and its authority to appoint a registrar until January 1, 2024; requires the CSLB to conduct a study of the contractor bond; and, makes other technical and clarifying changes to the contractors’ license law.

EXISTING LAW:

1. Establishes the CSLB under the Department of Consumer Affairs (DCA) to license and regulate contractors and home improvement salespersons. (Business and Professions Code (BPC) § 7000 et seq.)
2. Sunsets the CSLB and its authority to appoint a registrar on January 1, 2020, as specified.
3. Requires the CSLB to meet at least once quarterly. (BPC § 7006)
4. Requires the CSLB to add an enhancement to the current contractor license check search function that permits consumers to search for a licensed contractor by either ZIP code or geographic location. (BPC § 7018)
5. Requires the registrar to make available to members of the public, the date, nature, and status of all complaints on file against a licensee that either have been referred for accusation or have been referred for investigation after a determination by CSLB enforcement staff that a probable violation has occurred, as specified, and regard allegations that if proven would present a risk of harm to the public and would be appropriate for suspension or revocation of the contractor’s license or criminal prosecution. (BPC § 7124.6(a))
6. Requires the CSLB, in collaboration with the Public Utilities Commission, to develop and make available a solar disclosure document, as specified. (BPC 7169(a))
7. Requires, as a condition of licensure, renewal, reinstatement, or reactivation of a license that the applicant file or have on file a contractor’s bond in the sum of $15,000, as specified. (BPC § 7071.6)
8. Requires an applicant for licensure, renewal, reinstatement, or change of officers or other personnel of record, who has previously been found to have failed or refused to pay a contractor, subcontractor, consumer, materials supplier, or employee based on an unsatisfied final judgment, to file or have on file with the CSLB a bond sufficient to guarantee payment of an amount equal to the unsatisfied final judgment and specifies the process for complying with the requirement, including timing, notice, and penalties. (BPC § 7071.17)
9. Prohibits the qualifying person, any partner of the licensee, or personnel of the licensee named as a judgment debtor in an unsatisfied final judgment, from serving as an officer, director, associate, partner, owner, manager, qualifying individual, or other personnel of record of another licensee. (BPC § 7071.17(j))
10. Requires persons who perform work as electricians to become certified and prohibits uncertified persons from performing electrical work for which certification is required. (Labor Code (LC) §108.2(a))
11. Specifies that certification is required only for those persons who perform work as electricians for contractors licensed as class C-10 electrical contractors under the CSLB’s rules and regulations. (LC § 108.2(b)(1))

THIS BILL:

1) Extends the sunset date of the CSLB and the CSLB’s authority to appoint a registrar by four years, until January 1, 2024.

2) Requires the CSLB to conduct a study to obtain information to evaluate whether the current $15,000 amount of the contractor bond is sufficient or whether an increase may be necessary and report back to the Legislature by January 1, 2024.

3) Extends the prohibition of qualifying person or personnel of record from serving as a qualifying individual or other personnel of record on any license until the judgment is satisfied when a judgment is entered against any personnel of record.

4) Requires, instead of authorizing the CSLB, to charge a fee of no more than $20 to enforce specified provisions of the LC.

5) Makes other technical and clarifying changes.

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

COMMENTS:

Purpose. This bill is sponsored by the Author. According to the Author, “[This bill] is necessary to reflect Committee staff recommendations made for the purpose of remedying issues identified through the CSLB’s Sunset Review process. This measure is one of five “sunset bills” the Author is sponsoring this year. This bill is necessary to make changes to the contractors’ law and CSLB operations in order to improve the effectiveness and efficiency of this regulatory entity.”

Background. Contractors’ State License Law (the laws and regulations related to the licensure, practice and discipline of the construction industry 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, including both labor and materials, of one or more contracts on the project is $500 or more.

Oversight Hearings and Sunset Review of Licensing Boards and Programs. Beginning in 2018, the Senate Business, Professions and Economic Development Committee and the Assembly Business and Professions Committee (Committees) began their comprehensive sunset review oversight of 10 regulatory entities and the DCA including: Board of Accountancy, California State Athletic Commission, Board of Barbering and Cosmetology, Bureau of Security and Investigative Services, California Architects Board and Landscape Architects Technical Committee, Cemetery and Funeral Bureau, Court Reporters Board of California, Dental Board of California, Board for Professional Engineers, Land Surveyors and Geologists, and the CSLB. This bill makes numerous changes to the Contractors State License Law as a result of the CSLB’s 2018 sunset review report and its subsequent participation in a sunset review hearing on February 26, 2019.

Electrician Certification. BPC § 7137 authorizes the CSLB to charge a fee, not to exceed $20, for C-10 (Electrician) and C-7 (Low Voltage Systems) licensees for enforcement of the electrician certification requirement as specified in LC §108.2. LC § 108.2(a) requires persons who perform work as electricians to become certified and prohibits uncertified persons from performing electrical work for which certification is required and specifies that certification is only required for persons who perform work as electricians for contractors licensed as C-10 electrical contractors.

The CSLB is responsible for ensuring that the C-10 employees meet the certification requirements. According to the CSLB, there are approximately 30,500 active C-10 contractors and if they use employees as prescribed in LC § 108.2, the CSLB must ensure that those employees are certified. The CSLB reports that it does not have sufficient staff resources allotted to ensure compliance with the LC requirement. As a result, the CSLB acknowledges that it does not effectively enforce this requirement. The CSLB has the statutory authority to charge the fee, but would need regulations to implement its authority; however, the regulatory process is currently under review, as it may take multiple years for the appropriate issuance of new regulations. The CSLB would like to request a statutory change to require the CSLB collect the $20 payment to increase enforcement efforts of the electrician certification. This bill requires the CSLB to collect the fee in order to ensure compliance with the required electrician certification.

Unsatisfied Judgements. Under current law, the CSLB has the authority to suspend a license if it learns of an unsatisfied construction related judgment imposed on a licensee, as specified in BPC § 7071.17. When the CSLB suspends a license for failure to pay an outstanding judgement, any qualifying individual or personnel on the license record is automatically prohibited from serving in those capacities on another license until the judgment is satisfied. This prohibition also causes suspension of the license of any other license entity with any of these same personnel as the license subject to the judgment (until those members disassociate from the license or the judgment is satisfied). Therefore, when a judgment is imposed on a license, the suspension extends to individuals associated with the judgment debtor license and other licenses. However, the reverse is not true: If a judgment is entered against an individual without naming the licensed entity, the statutory language does not authorize CSLB to suspend the license on which the individual appears. As a result, an individual named on a construction-related judgment can remain on a license. The proposed clarifying change to BPC section 7071.17 would preclude license applicants, if they were subject to an unsatisfied final judgment, from becoming licensed until that judgment is satisfied. Additionally, it would preclude an individual named in an unsatisfied judgment from appearing on an active license until the judgment is satisfied.

Contractors Bond. Current law (BPC § 7071.6), as a condition precedent to the issuance, renewal, reinstatement, reactivation or continued maintenance of a license, an applicant is required to file or have on file with the CSLB a contractor’s bond in the amount of $15,000. During the CSLB’s 2016 sunset review, the amount of the contractor’s bond was raised from $12,500 to $15,000. During the CSLB’s February 26, 2019 sunset review hearing, the sufficiency of the current bond was raised. To further investigate whether or not the current $15,000 is sufficient or not, this bill will require the CSLB to conduct a study to obtain information to evaluate if the current $15,000 bond amount is sufficient, or whether an increase may be necessary by January 1, 2024.

Technical Changes. As noted in the CSLB’s 2018 Committee staff Background Paper, there may be a number of non-substantive and technical changes to the contractors’ law, which may improve efficiencies. As a result, this bill makes other technical and clarifying changes to assist in improving efficiencies for the CSLB to operate its licensing and regulatory processes.

Sunset Extension. As noted in the CSLB’s 2018 Committee staff Background Paper, the safety and welfare of consumers persists under the presence of a strong licensing and regulatory structure to oversee the contractor profession. The CSLB’s focus is consumer protection, to that end, has demonstrated its commitment to ensuring a robust contractor market place. Although, there are places where the CSLB can improve, including fiscal prudence, strengthening its licensing and enforcement objectives and those respective programmatic units, and identifying legislative priorities sooner, the CSLB should continue with a four-year sunset date. This bill extends the sunset date of the CSLB by four years and its authority to appoint a registrar, until January 1, 2024.

Current Related Legislation. AB 1519 (Low), which is pending in the Senate, is the sunset review bill for the Dental Board of California and would extend the board and it’s authority to appoint an executive officer until January 1, 2024.

AB 1520 (Low), which is pending in the Senate, is the sunset review bill for the Court Reporters Board of California and would extend the board and it’s authority to appoint an executive officer until January 1, 2024.

AB 1521 (Committee on Business and Professions), which is pending in the Senate, is the sunset review bill for the California Board of Accountancy, would extend the board and its authorization to designate an executive officer to January 1, 2024, and would make various technical and nonsubstantive changes.

AB 1522 (Low), which is pending in the Senate, is the sunset review bill for the Board for Professional Engineers, Land Surveyors, and Geologists and would extend the board and it’s authority to appoint an executive officer until January 1, 2024.

AB 1523 (Low), which is pending in the Senate, is the sunset review bill for the State Athletic Commission and would extend the Commission and it’s authority to appoint an executive officer until January 1, 2024, and authorize the Commission to hire a Chief Athletic Inspector and Assistant Chief Athletic Inspector.

SB 607 (Glazer), which is pending in this Committee, is the sunset review bill for the Board of Barbering and Cosmetology would require the board’s Health and Safety Advisory Committee (Advisory Committee) to include three board members and adds information on professional cosmetic labeling requirements to the list of health and safety issues the Advisory Committee provides advice and recommendations on barbering and cosmetology.

SB 608 (Glazer), which is pending in this Committee, is the sunset review bill for the California Architects Board and the Landscape Architects Technical Committee and requires each to conduct background checks on applicants, modifies requirements of written contracts, aligns executive officer duties for both the board and the committee, requires the board to establish standards for continuing education, and extends the sunset dates for both entities until January 1, 2024.

SB 609 (Glazer), which is pending in this Committee, is the sunset review bill for the bill for the Bureau of Security and Investigative Services, which would prohibit the bureau from issuing firearms permits to applicants under 21 years of age; consolidate the Private Investigator Fund and the Private Security Services Fund into one fund; place the responsibility of completing annual guard skills training on the security guard registrant and require the registrant, instead of the employer, to attest on their renewal application that they have completed the required annual security guard skills training; require security guards who are unemployed or working for a business that does not require a private patrol operator license to be responsible for completing annual guard skills training in order to maintain a valid registration; eliminate the requirement for the employer’s signature that attests to an applicant completing the power to arrest training and instead requires the security guard applicant to provide specified proof of the training; require the bureau to be reviewed by the appropriate policy of the Legislature by January 1, 2024; and make other technical and clarifying changes to the six practice acts regulated by BSIS.

ARGUMENTS IN SUPPORT:

The Associated Builders and Contractors of Northern California writes in support, “Because we recognize the importance of a well-regulated industry to promote safety and compliance, ABC Nor Cal is pleased to support the bill and urge your ‘Aye’ vote. In particular, we are pleased to support urging the CSLB to webcast its meetings.”

REGISTERED SUPPORT:

Associated Builders And Contractors Northern California Chapter

California Legislative Conference Of Plumbing, Heating & Piping Industry

Contractors State License Board

Electrical Contractors Of California Trust

Engineering & Utility Contractors Association Dba United Contractors

Greater Bay Chapter - American Fire Sprinkler Association

Independent Roofing Contractors Of California, Inc.

Northern California Allied Trades

Plumbing-Heating-Cooling Contractors Association Of California

Sacramento Valley Chapter - American Fire Sprinkler Association

Wall And Ceiling Alliance

Western Electrical Contractors Association

Western Wall And Ceiling Contractors Association (Wwcca)

REGISTERED OPPOSITION:

None on file.

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

 THIRD READING  

Bill No: SB 610

Author: Glazer (D)

Amended: 4/11/19

Vote: 21

SENATE BUS., PROF. & ECON. DEV. COMMITTEE: 9-0, 4/22/19

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

SENATE APPROPRIATIONS COMMITTEE: 6-0, 5/16/19

AYES: Portantino, Bates, Bradford, Hill, Jones, Wieckowski

SUBJECT: Contractors: licensing and regulation

SOURCE: Author

DIGEST:

This bill extends the sunset date of the Contractors State License Board (CSLB) and its authority to appoint a registrar until January 1, 2024; requires the CSLB to conduct a study of the contractor bond; and, makes other technical and clarifying changes to the Contractors’ State License Law (contractors’ law).

ANALYSIS:

Existing law:

1. Establishes the CSLB under the Department of Consumer Affairs (DCA) to license and regulate contractors and home improvement salespersons and sunsets the CSLB and its authority to appoint a registrar on January 1, 2020. (Business and Professions Code (BPC) § 7000 et seq.)
2. Requires the CSLB to add an enhancement to the current contractor license check search function that permits consumers to search for a licensed contractor by either ZIP Code or geographic location. (BPC § 7018)
3. Requires the CSLB, in collaboration with the Public Utilities Commission, to develop and make available a solar disclosure document, as specified. (BPC 7169(a))
4. Requires, as a condition of licensure, renewal, reinstatement, or reactivation of a license that the applicant file or have on file a contractor’s bond in the sum of $15,000, as specified. (BPC § 7071.6)
5. Prohibits the qualifying person, any partner of the licensee, or personnel of the licensee named as a judgment debtor in an unsatisfied final judgment, from serving as an officer, director, associate, partner, owner, manager, qualifying individual, or other personnel of record of another licensee. (BPC § 7071.17(j))
6. Requires persons who perform work as electricians to become certified and prohibits uncertified persons from performing electrical work for which certification is required and specifies that certification is required only for those persons who perform work as electricians for contractors licensed as class C-10 electrical contractors under the CSLB’s rules and regulations. (Labor Code (LC) §108.2(a)(b)(1))

This bill:

1. Extends the sunset date of the CSLB and the CSLB’s authority to appoint a registrar by four years, until January 1, 2024.
2. Requires the CSLB to conduct a study to obtain information to evaluate whether the current $15,000 amount of the contractor bond is sufficient or whether an increase may be necessary and report back to the Legislature by January 1, 2024.
3. Extends the prohibition of qualifying person or personnel of record from serving as a qualifying individual or other personnel of record on any license until the judgment is satisfied when a judgment is entered against any personnel of record.
4. Requires, instead of authorizing the CSLB, to charge a fee of no more than $20 to enforce specified provisions of the LC.
5. Makes other technical and clarifying changes.

Background

The CSLB is responsible for the implementation and enforcement of the contractors’ law (the laws and regulations related to the licensure, practice and discipline of the construction industry 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, including both labor and materials, of one or more contracts on the project is $500 or more.

Oversight hearings and sunset review of licensing boards and programs. Beginning in 2018, the Senate Business, Professions and Economic Development Committee and the Assembly Committee on Business and Professions (Committees) began their comprehensive sunset review oversight of 10 regulatory entities and the DCA, including the CSLB. This bill makes numerous changes to the contractors’ law as a result of the CSLB’s 2018 sunset review report and its subsequent participation in a sunset review hearing on February 26, 2019.

Electrician certification. BPC Section 7137 authorizes the CSLB to charge a fee, not to exceed $20, for C-10 (Electrician) and C-7 (Low Voltage Systems) licensees for enforcement of the electrician certification requirement as specified in LC Section 108.2. LC Section 108.2(a) requires persons who perform work as electricians to become certified. Additionally, it prohibits uncertified persons from performing electrical work for which certification is required and specifies that certification is only required for persons who perform work as electricians for contractors licensed as C-10 electrical contractors.

The CSLB is responsible for ensuring that C-10 employees meet the certification requirements. According to the CSLB, there are approximately 30,500 active C-10 contractors and if they use employees as prescribed in LC Section 108.2, the CSLB must ensure that those employees are certified. The CSLB reports that it does not have sufficient staff resources allotted to ensure compliance with the LC requirement. As a result, the CSLB acknowledges that it does not effectively enforce this requirement. The CSLB has the statutory authority to charge the fee, but would need regulations to implement its authority. The regulatory process is currently under review, as it may take multiple years for the appropriate issuance of new regulations. This bill requires the CSLB to collect the fee in order to ensure compliance with the required electrician certification.

Unsatisfied judgements. Under current law, the CSLB has the authority to suspend a license if it learns of an unsatisfied construction related judgment imposed on a licensee, as specified in BPC Section 7071.17. When the CSLB suspends a license for failure to pay an outstanding judgement, any qualifying individual or personnel on the license record is automatically prohibited from serving in those capacities on another license until the judgment is satisfied. This prohibition also causes suspension of the license of any other license entity with any of these same personnel as the license subject to the judgment (until those members disassociate from the license or the judgment is satisfied). Therefore, when a judgment is imposed on a license, the suspension extends to individuals associated with the judgment debtor license and other licenses. However, the reverse is not true: If a judgment is entered against an individual without naming the licensed entity, the statutory language does not authorize CSLB to suspend the license on which the individual appears. As a result, an individual named on a construction-related judgment can remain on a license. The proposed clarifying change to BPC Section 7071.17 would preclude license applicants, if they were subject to an unsatisfied final judgment, from becoming licensed until that judgment is satisfied. Additionally, it would preclude an individual named in an unsatisfied judgment from appearing on an active license until the judgment is satisfied.

Contractors bond. Current law (BPC § 7071.6), as a condition of issuance, renewal, reinstatement, reactivation or continued maintenance of a license, an applicant is required to file or have on file with the CSLB a contractor’s bond in the amount of $15,000. During the CSLB’s 2016 sunset review, the amount of the contractor’s bond was raised from $12,500 to $15,000. During the CSLB’s February 26, 2019 sunset review hearing, the sufficiency of the current bond was questioned. To further investigate whether or not the current $15,000 is sufficient or not, this bill will require the CSLB to conduct a study to obtain information to evaluate if the current $15,000 bond amount is sufficient, or whether an increase may be necessary by January 1, 2024.

Technical changes. As noted in the CSLB’s 2019 Committees staff Background Paper, there may be a number of non-substantive and technical changes to the contractors’ law, which may improve efficiencies. As a result, this bill makes other technical and clarifying changes to assist in improving efficiencies for the CSLB to operate its licensing and regulatory processes. This bill extends the sunset date of the CSLB by four years and its authority to appoint a registrar, until January 1, 2024.

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

According to the Senate Appropriations Committee, this bill will result in annual ongoing expenditures of approximately $66.0 million (Contractors License Fund) and 84.5 positions for the CSLB, based on Budget Act of 2018 figures, to continue operation beyond its current sunset date of January 1, 2020. The analysis also notes minor and absorbable costs to create new revenue codes.

SUPPORT: (Verified 5/16/19)

Associated Builders and Contractors of Northern California

OPPOSITION: (Verified 5/16/19)

None received

ARGUMENTS IN SUPPORT: The Associated Builders and Contractors of Northern California writes in support, “Because we recognize the importance of a well-regulated industry to promote safety and compliance, ABC Nor Cal is pleased to support the bill and urge your ‘Aye’ vote. In particular, we are pleased to support urging the CSLB to webcast its meetings.”

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

5/18/19 12:13:44

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Anthony Portantino, Chair

2019 - 2020 Regular Session

SB 610 (Glazer) - Contractors: licensing and regulation

Bill Summary:

Senate Bill 610 would extends the sunset date of the Contractors State License Board (CSLB) and its authority to appoint a registrar, from January 1, 2020 to January 1, 2024. Would require the CSLB to conduct a study of the contractor bond; and, makes other technical and clarifying changes to the contractors’ license law.

Fiscal Impact:

CSLB is fee-supported from licensing and renewal fees. Based on a February 29, 2019, below is the Board’s fund condition. Although reserve levels are declining, the CSLB does not project any budgetary issues and does not have any planned fee increases. CSLB attributes the decline in reserve levels to increases in onetime expenditures including personnel costs, statewide pro rata, enforcement, and disaster response.

• Annual ongoing expenditures of approximately $66.0 million (Contractors License Fund) and 84.5 positions for the CSLB, based on Budget Act of 2018 figures, to continue operation beyond its current sunset date of January 1, 2020.
• Minor and absorbable costs to create new revenue codes.

Background:

The CSLB enforces the Contractors’ State License Law, which are the laws and regulations related to the licensure, practice and discipline of the construction industry 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, including both labor and materials, of one or more contracts on the project is $500 or more. The CSLB licenses and regulates approximately 285,000 licensees in 44 licensing classifications and 2 certifications, and registers approximately 18,000 Home Improvement Salespersons. There are categories of contractors: “A” is a general engineering contractor in fixed works, “B” is a general building contractor whose business is in connection with any structure built for shelter, and “C” is a specialty contractor, such as a carpentry, insulation, roofing, hot water heating, plumbing, or masonry, among others.

This bill makes numerous changes to the Contractors State License Law as a result of the CSLB’s 2018 sunset review report and its subsequent participation in a sunset review hearing on February 26, 2019.

Proposed Law:

This bill includes the following provisions, among others:

• Extends the sunset date of the CSLB and the CSLB’s authority to appoint a registrar by four years, from January 1, 2020, until January 1, 2024.
  
• Requires the CSLB to maintain the current contractor license check search function on its website.
  
• Requires the CSLB to conduct an evaluation study, whether the current $15,000 amount of the contractor bond is sufficient, and report findings to the Legislature by January 1, 2024.
  
• Requires the CSLB to charge a fee of no more than $20 to enforce specified provisions.
  
• Requires the CSLB to make an effort to webcast all meetings, as specified.
  
• Makes other technical and clarifying changes.

Staff Comments:

The CSLB estimates additional revenue collection, however it is unclear if the $20 fee for C-10 contractors to enforce provisions of the Labor Code related to electrician certification applies to existing and new C-10 contractors, or if it applies to only new applicants. If the language applies to all C-10 contractors, the board would collect an additional $515,000 in revenue. If it only applies to new applicants, the board would realize a minor increase, though indeterminate at this time.

-- END --

SENATE COMMITTEE ON

BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT

Senator Steven Glazer, Chair

2019 - 2020 Regular

Bill No: SB 610 Hearing Date: April 22, 2019

Subject: Contractors: licensing and regulation.

SUMMARY:

Extends the sunset date of the Contractors State License Board (CSLB) and its authority to appoint a registrar until January 1, 2024; requires the CSLB to conduct a study of the contractor bond; and, makes other technical and clarifying changes to the contractors’ license law.

Existing law:

1. Establishes the CSLB under the Department of Consumer Affairs (DCA) to license and regulate contractors and home improvement salespersons. (Business and Professions Code (BPC) § 7000 et seq.)
   
2. Sunsets the CSLB and its authority to appoint a registrar on January 1, 2020, as specified.
   
3. Requires the CSLB to meet at least once quarterly. (BPC § 7006)
   
4. Requires the CSLB to add an enhancement to the current contractor license check search function that permits consumers to search for a licensed contractor by either ZIP code or geographic location. (BPC § 7018)
   
5. Requires the registrar to make available to members of the public, the date, nature, and status of all complaints on file against a licensee that either have been referred for accusation or have been referred for investigation after a determination by CSLB enforcement staff that a probable violation has occurred, as specified, and regard allegations that if proven would present a risk of harm to the public and would be appropriate for suspension or revocation of the contractor’s license or criminal prosecution. (BPC § 7124.6(a))
   
6. Requires the CSLB, in collaboration with the Public Utilities Commission, to develop and make available a solar disclosure document, as specified. (BPC 7169(a))
   
7. Requires, as a condition of licensure, renewal, reinstatement, or reactivation of a license that the applicant file or have on file a contractor’s bond in the sum of $15,000, as specified. (BPC § 7071.6)
   
8. Requires an applicant for licensure, renewal, reinstatement, or change of officers or other personnel of record, who has previously been found to have failed or refused to pay a contractor, subcontractor, consumer, materials supplier, or employee based on an unsatisfied final judgment, to file or have on file with the CSLB a bond sufficient to guarantee payment of an amount equal to the unsatisfied final judgment and specifies the process for complying with the requirement, including timing, notice, and penalties. (BPC § 7071.17)
   
9. Prohibits the qualifying person, any partner of the licensee, or personnel of the licensee named as a judgment debtor in an unsatisfied final judgment, from serving as an officer, director, associate, partner, owner, manager, qualifying individual, or other personnel of record of another licensee. (BPC § 7071.17(j))
   
10. Requires persons who perform work as electricians to become certified and prohibits uncertified persons from performing electrical work for which certification is required. (Labor Code (LC) §108.2(a))
11. Specifies that certification is required only for those persons who perform work as electricians for contractors licensed as class C-10 electrical contractors under the CSLB’s rules and regulations. (LC § 108.2(b)(1))
    

This bill:

1. Extends the sunset date of the CSLB and the CSLB’s authority to appoint a registrar by four years, until January 1, 2024.
   
2. Requires the CSLB to maintain the current contractor license check search function on its internet website.
   
3. Requires the CSLB to conduct a study to obtain information to evaluate whether the current $15,000 amount of the contractor bond is sufficient or whether an increase may be necessary and report back to the Legislature by January 1, 2024.
   
4. Extends the prohibition of qualifying person or personnel of record from serving as a qualifying individual or other personnel of record on any license until the judgment is satisfied when a judgment is entered against any personnel of record.
   
5. Requires, instead of authorizing the CSLB, to charge a fee of no more than $20 to enforce specified provisions of the LC.
   
6. Requires the CSLB to make an effort to webcast all meetings, as specified.
   
7. Makes other technical and clarifying changes.

FISCAL EFFECT:

Unknown. This bill is keyed “fiscal” by the Legislative Counsel.

COMMENTS:

1. Purpose. This bill is sponsored by the Author. According to the Author’s office, “this bill is necessary to reflect Committee staff recommendations made for the purpose of remedying issues identified through the CSLB’s Sunset Review process. This measure is one of five “sunset bills” the Author is sponsoring this year. This bill is necessary to make changes to the contractors’ law and CSLB operations in order to improve the effectiveness and efficiency of this regulatory entity.”
2. Background.

CSLB. The CSLB responsible for the implementation and enforcement of the Contractors’ State License Law (the laws and regulations related to the licensure, practice and discipline of the construction industry 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, including both labor and materials, of one or more contracts on the project is $500 or more.

Oversight Hearings and Sunset Review of Licensing Boards and Programs. Beginning in 2018, the Senate Business, Professions and Economic Development Committee and the Assembly Business and Professions Committee (Committees) began their comprehensive sunset review oversight of 10 regulatory entities and the DCA including: Board of Accountancy, California State Athletic Commission, Board of Barbering and Cosmetology, Bureau of Security and Investigative Services, California Architects Board and Landscape Architects Technical Committee, Cemetery and Funeral Bureau, Court Reporters Board of California, Dental Board of California, Board for Professional Engineers, Land Surveyors and Geologists, and the CSLB. This bill makes numerous changes to the Contractors State License Law as a result of the CSLB’s 2018 sunset review report and its subsequent participation in a sunset review hearing on February 26, 2019.

Electrician Certification. BPC § 7137 authorizes the CSLB to charge a fee, not to exceed $20, for C-10 (Electrician) and C-7 (Low Voltage Systems) licensees for enforcement of the electrician certification requirement as specified in LC §108.2. LC § 108.2(a) requires persons who perform work as electricians to become certified and prohibits uncertified persons from performing electrical work for which certification is required and specifies that certification is only required for persons who perform work as electricians for contractors licensed as C-10 electrical contractors.

The CSLB is responsible for ensuring that the C-10 employees meet the certification requirements. According to the CSLB, there are approximately 30,500 active C-10 contractors and if they use employees as prescribed in LC § 108.2, the CSLB must ensure that those employees are certified. The CSLB reports that it does not have sufficient staff resources allotted to ensure compliance with the LC requirement. As a result, the CSLB acknowledges that it does not effectively enforce this requirement. The CSLB has the statutory authority to charge the fee, but would need regulations to implement its authority; however, the regulatory process is currently under review, as it may take multiple years for the appropriate issuance of new regulations. The CSLB would like to request a statutory change to require the CSLB collect the $20 payment to increase enforcement efforts of the electrician certification. This bill requires the CSLB to collect the fee in order to ensure compliance with the required electrician certification.

Unsatisfied Judgements. Under current law, the CSLB has the authority to suspend a license if it learns of an unsatisfied construction related judgment imposed on a licensee, as specified in BPC § 7071.17. When the CSLB suspends a license for failure to pay an outstanding judgement, any qualifying individual or personnel on the license record is automatically prohibited from serving in those capacities on another license until the judgment is satisfied. This prohibition also causes suspension of the license of any other license entity with any of these same personnel as the license subject to the judgment (until those members disassociate from the license or the judgment is satisfied). Therefore, when a judgment is imposed on a license, the suspension extends to individuals associated with the judgment debtor license and other licenses. However, the reverse is not true: If a judgment is entered against an individual without naming the licensed entity, the statutory language does not authorize CSLB to suspend the license on which the individual appears. As a result, an individual named on a construction-related judgment can remain on a license. The proposed clarifying change to BPC section 7071.17 would preclude license applicants, if they were subject to an unsatisfied final judgment, from becoming licensed until that judgment is satisfied. Additionally, it would preclude an individual named in an unsatisfied judgment from appearing on an active license until the judgment is satisfied.

Contractors Bond. Current law (BPC § 7071.6), as a condition precedent to the issuance, renewal, reinstatement, reactivation or continued maintenance of a license, an applicant is required to file or have on file with the CSLB a contractor’s bond in the amount of $15,000. During the CSLB’s 2016 sunset review, the amount of the contractor’s bond was raised from $12,500 to $15,000. During the CSLB’s February 26, 2019 sunset review hearing, the sufficiency of the current bond was raised. To further investigate whether or not the current $15,000 is sufficient or not, this bill will require the CSLB to conduct a study to obtain information to evaluate if the current $15,000 bond amount is sufficient, or whether an increase may be necessary by January 1, 2024.

Technical Changes. As noted in the CSLB’s 2018 Committee staff Background Paper, there may be a number of non-substantive and technical changes to the contractors’ law, which may improve efficiencies. As a result, this bill makes other technical and clarifying changes to assist in improving efficiencies for the CSLB to operate its licensing and regulatory processes.

Sunset Extension. As noted in the CSLB’s 2018 Committee staff Background Paper, the safety and welfare of consumers persists under the presence of a strong licensing and regulatory structure to oversee the contractor profession. The CSLB’s focus is consumer protection, to that end, has demonstrated its commitment to ensuring a robust contractor market place. Although, there are places where the CSLB can improve, including fiscal prudence, strengthening its licensing and enforcement objectives and those respective programmatic units, and identifying legislative priorities sooner, the CSLB should continue with a four-year sunset date. This bill extends the sunset date of the CSLB by four years and its authority to appoint a registrar, until January 1, 2024.

1. Arguments in Support. The Associated Builders and Contractors of Northern California, writes in support, “”Because we recognize the importance of a well-regulated industry to promote safety and compliance, ABC Nor Cal is please to support the bill and urge your “Aye” vote. In particular, we are pleased to support urging the CSLB to webcast its meetings.”

SUPPORT AND OPPOSITION:

Support:

Associated Builders and Contractors of Northern California

Opposition:

None on file as of April 17, 2019.

-- END --