Senate Standing Committee on Business, Professions and Economic Development

Good morning, everybody. Welcome to this morning's sunset review oversight hearing, which is being held jointly by the Assembly Business and Professions Committee and the Senate Committee on Business, Professions and Economic Development. I wish them luck in economic development. I hope no one's looked at their 401k.

This is the first of several sunset hearings that will be taking place over the next few weeks. And I would like to welcome the Members who are new to the committees as they join for this important oversight process.

And the new Members on the Assembly side are Assembly Members Aarons, Bauer Kahan, Caloza, Elhawary, Hadwick, Haney, Krell, and Macedo. And I'm not sure who the new Senators are, so welcome to all the Senators who are here. Joy, good to see you. Senator. Senator Weber, good to see you. Congrats on getting on the Committee.

On the Senate side, It's a fun Committee. Today we will be hearing from four entities responsible for overseeing the regulation of licensed professionals in California. The Bureau of Real Estate Appraisers, the Department of Real Estate, the Veterinary Medical Board, and the Board of Optometry. For each portion of today's hearing. Good morning.

For each portion of today's hearing, we will begin by hearing from representatives of the entity under review. Next, we will open the discussion up for questions or comments from Committee Members. Finally, we will invite other interested stakeholders here in the room to provide public comment. Speakers will be limited to a maximum of two minutes per organization.

In additional speakers making substantially similar comments may be asked to simply provide their name and state their alignment with prior testimony. I'm looking forward to a productive discussion today and would like to thank Committee staff for all of their hard work throughout this process.

And before we begin, I want to turn it over to my Senate counterpart, Chair Ashby, for any introductory remarks you would like to make.

Thank you so much. Chair Berman, Appreciate. Appreciate you getting us kicked off. And thank you to all of our colleagues, both from the Assembly and the Senate, who are here bright and early on a Tuesday morning in lovely downtown Sacramento, ready to do our favorite thing, of course, oversight, which is a critical and important function of this body, the legislative body.

I want to acknowledge the significant amount of time, energy and work that all of the Members of this dais and our staff and our team and the experts in the community who we partner with regularly have put into getting to today. These hearings have meaning.

And through our conversations, we're able to really move the State of California forward on a positive trajectory. And I know the Chairman and I both share a special interest in economic development and doing these Oversight committees and sunset reviews allow us an opportunity to find areas where the State of California can really improve our investment base.

So thank you to all for your partnerships there and to the commitment and dedication of the elected officials up here this morning and every day ready to work on these issues for the Golden State. Thanks for having us.

Thank you, Chair Ashby and today's hearing will begin with representatives of the Bureau of Real Estate Appraisers. Testifying today is Kimberly Kirchmeyer, Director of the Department of Consumer Affairs, and Bureau Chief Angela Jemmott. Please begin whenever you're ready.

Good morning Chair Ashby, Assemblymember Berman and Committee Members. I want to thank you for the opportunity to come before you today to discuss the Bureau of Real Estate Appraisers or Bureau or Brea as we call them.

I would also like to thank your staff for their diligent work on the well written background paper materials they prepared for the hearing today. Federal law requires all states to license and certify real estate appraisers who conduct appraisals for federally related transactions. The Bureau issues trainee licenses, residential licenses, certified Residential Licenses and certified General licenses.

The Licensing Unit implements the minimum requirements for licensure according to criteria established by the Federal Government and California law to ensure that only qualified persons are licensed to conduct appraisals in federally related real estate transactions. The Licensing Unit also registers appraisal management companies.

The Bureau is responsible for the accreditation of educational courses and providers for real estate appraisers. Important consumer protection legislation was implemented by the Bureau since its last census review.

AB 948 by Assemblymember Holden, which passed in 2021, enacted the Fair Appraisal act, requiring that after July 1st of 2022, every real property sale contract include a notice informing the buyer of their right to an unbiased appraisal and how to file a complaint with the Bureau.

This Bill also required the Bureau to update its complaint form, track demographic information related to these complaints, and report the information to the Legislature. This report was finalized and submitted to the Legislature on November 212024.

Additionally, beginning January 1st of 2023, applicants must complete at least one hour of instruction of Cultural competency and continuing education for license renewals must must include at least two hours of elimination of bias training. The Bureau conducted a demographic survey in June of 2023 that received 2500 responses, representing a 27% response rate.

The information provided was and will continue to help shape the Bureau's marketing and outreach efforts since its last sunset review. Angela Jamot was sworn in as the new bureau chief, effective March 2 of 2022. These are just a few of the important consumer protection efforts the Bureau has undertaken since the last sunset review.

Here with me to talk about the Bureau and answer the questions is Bureau Chief Angela Jemmott, and Chief Jemmott will continue with information about the Bureau.

Great. Thank you for being here.

Yes, thank you so much and good morning. I'll try that again. Good morning Chair Aspie, Chair Berman, and to the Committee Members today, I do also want to thank and for the opportunity to be here to discuss the Bureau.

I would also like to publicly acknowledge your exemplary staff for their stellar support in preparing the materials for today's hearing. I was sworn and at a pivotal time for the Bureau and for the entire appraisal industry.

That same month, President Biden's Interagency Task Force on Property Appraisal and Valuation Equity, known as pave, released actions aimed at eliminating racial and ethnic bias in home valuations.

Recognizing the significance of that moment in time, my team worked with great precision with the regulatory language to make changes in the Bureau's regulations to ensure 100% experience credit through the practical application of real estate appraisal, which is known by moats, parea and practicum programs, and to ensure that California CORS providers were well equipped to address these critical issues of AB948, Brea recruited subject matter experts for an educational symposium.

This event drew over 100 people representing eight different states. Following this success in November 22, I was invited by the Appraisal Foundation Board to join a panel discussion with representatives from two other states at that time, California stood out as the only state directly implementing laws and regulation aimed at eradicating equality in the appraisal industry.

In May of 2023, I was honored to be the sole State of regulators on a five Member panel at the Appraisal Subcommitee hearing in Washington, D.C. where inequalities in property valuations and significant flaws in the current appraisal regulatory structure was addressed.

And at that hearing, I was proudly able to share a newly signed MOU with the Department of Civil Rights which demonstrated BRE's commitment to meaningful reform. Beyond my role at BRE, I represent California nationally at a Board of Members of Association of Appraisal Regulators Association, which is called arrow. I've spoken at the National Appraisal Diversity Initiative.

I participated in the Department of Real Estate at podcast series for new homeowners and was interviewed by the Sacramento observer as a lack of diversity in the appraisal industry. Additionally, Brea has engaged in various organizations including the Appraisal Institute, Government Liaison Subcommitee, the Board of Equalization Working Committee, the Northern California Women's Initiative.

These are interactions that prove to have been great insight into the needs of the industry and the community we serve operationally, BRIA has strengthened our investigation capacities regarding bias complaints.

Our entire staff has participated in a three week HUD video series on understanding racial bias and appraisal, and we continue to pursue opportunities for professional development to ensure the Bureau has served the public with excellence. Additionally, the Bureau takes great pride in the significant improvement we made this year in our licensing processing.

Once again, I appreciate this opportunity to address the Committee and I look forward to all of your questions this morning. Thank you.

Okay, thank you very much for your presentation. Any questions from the Committee? Any questions from any Senators? Any questions? Oh, yes, please.

Thank you. Thanks for the presentation there. How will the duties of the Bureau fit under the governor's proposal to separate the agency into two, the consumer protection and housing?

Thank you so much. And again, just thank you for allowing us to be here and answer these questions. So currently the Bureau is under the Department of Consumer affairs and the Department of Consumer affairs will go under the Consumer Protection Agency.

Thank you. No further questions. Okay. Senator Archuleta?

Yeah. Thank you, Mr. Chair, and thank you both for being here today. I have a history of real estate and I appreciate the work you do. The appraisers, I've worked with them for 30 years and.

But I want to extend certainly entire Committee and ourselves the number of hours and work that that is before you with the fires, you know, Altadena, Palisades and areas of Pasadena, your industry is going to be looked at wondering how you're going to work with the homeowners, property owners, commercial owners, and of course working with the bank to make sure that these owners are giving a fair shake of the real estate value.

And with the structures gone now, you have to really dig in deep, do your homework and to make sure that they're given every opportunity to receive that excellent level of appraisal, because that could make a difference between receiving monies and not receiving monies, dealing with the bank and so on. So I want to extend that. What, what is your plan of attack? Have you been called upon excessively now that. How are you handling the number of calls?

Yes, thank you for that question. And indeed we all Californians feel the pain and the suffering that is occurring in Southern California. And we have, have already participated with the Executive order in the two areas.

One is that for, for us, the one we have provided a reprieve through the Executive order that a delay, a deferment of all licensures, fees in which they do not have to pay within their cycle, there's a two year cycle and they do not have to pay for this next year.

And so this is our immediate response to our licensees. So that side of the house, which is two sides, as you had mentioned, there's the homeowners and then our work that we have to do.

And so with the other side, we have immediately created and consumer guide to assist the homeowners and the consumers who have buildings that are impacted by the fire. And we have created an extensive communications link that supports that within the Department of Consumer Affairs.

So we have supported it fully and will continue to as the issues may arise. We have also seen that within the industry there are communications to help strengthen our appraisers to become more experts in this area.

So I know specifically I sat in on one of the appraisal Institute, had a webinar to help strengthen our appraisers to make sure they come more experts in this area.

And so we are clearly supporting and as much as we can, we have looked at any of the federal opportunities as well to support this issue in terms of disasters, and we looked at our laws and regulations that supports that.

And we haven't gotten a lot of calls yet because I think everybody's not into that recovery step yet. And correct me if I'm wrong, Chief Jemmott, but not a lot of calls have come in yet. We're expecting them to come in in the future.

We'll be able to handle those through both the bureau staff as well as we have our consumer Information center handling those calls.

And really the other thing is just the importance of making sure that, you know, you check the individual that's doing that appraisal, check them on the bureau's website, make sure that that individual's license, if you're using that federally related transaction, and so just really getting the word out to make sure that you do your research on these individuals as well.

And I'm hoping that maybe some adjustments might be made on the cost because obviously these homeowners are suffering and an additional cost for the appraisal, that could hurt, too. So anything that you can do as an Association across the board there in Southern California, I'm sure would be appreciated. Thank you, Mr. Chair.

Thank you, Senator. I'm going to go to Senator Choi and then I've got a little line, so I'll get everybody. Senator Choi, please go ahead.

Thank you, Chair. And then also for your presentation. In your presentation, you mentioned several times about the racial bias. I know in the real estate transaction, appraisal is a part of the requirement. They're going to have a loan.

When appraiser comes in, they evaluate what the value of the house will be, what kind of bias goes in, who's living in there. And my home, because I'm an Asian, will be valued less or more or against any other racial profile. I wonder. I never thought about that worry or concern. Can you define what you mean by that?

Yes. This is a question that has been brought up nationally in regards to racial and ethnic biases in the area of appraisal valuations. So much so As I mentioned, President Biden created a task force to address it because how it impacts generational wealth. With that being so important, there was a task force to address it directly.

We do have jurisdiction and requirements within our training and regarding being fair and unbiased. And that is a part of our law in terms of uniform appraisal performance. We have to do that, but we have to also address if there's an issue.

And so there has been additional training, additional communication communications to understand if there's any explicit bias or unexplicit biases. Those are things that we have been identified nationally as well as within the state to ensure cultural competency is being taught by appraisers.

And that's what AB 948 assisted in by assisting training for our appraisers to ensure they have cultural competency as well as the additional when our course was elimination of bias. So we have a three hour course that's required by all licensees to ensure that there is no biases occurring within the practice of their appraisal work.

I wonder whether this concern was raised because of there was a such a bias practice in appraisal practice or this is academic or social theoretical concern with no foundation. Did you run into any cases that sudden home appraisal was different and value the differently because of racial issue of the owner who's trying to sell?

Yes, this is something that has been happening nationally and it has been proven. It's been in a lot of media and articles where individuals depending on their race they are under the homes are undervalued. And that was what is happening in that appraisal industry.

Which is why it's so important for for us to be getting those complaints and to looking at them from that perspective. This wasn't just theoretical. This was occurring and is occurring.

And so yeah, even before I forget let me interject. I would really assume if my home is appraised by five different let's say appraisers without their sharing opinions each other, their appraisal will come out to be probably all different. I can be assured of that. This is very subjective. There's no formula.

So how can you based that kind of issue based on the racial buyers was the factor and was there any number of reliable scientific study for example quantify the qualified number of the subjects who were victims of a racial bias.

So your your question Member Choi, is that do we have statistics on whether this. Is a theoretical or actual problem?

That's what I'm trying to determine.

Maybe I know there have been a lot of studies that have been done and a lot of investigations that have been done that, that have for instance, a seller who's white and then a seller who's a person of color for the same house that show that the valuations are drastically different.

So maybe we can provide Senator Choi's office with all of that background information so that you can see that it is very quantifiable. There's been for decades a lot of information that's out there that shows significant racial bias amongst, amongst assessors. So maybe can we provide that information to the Senator's office?

Yes, we can definitely get information and provide it to you.

Yeah, while I'm speaking, maybe I can follow up on this issue. Can you? I know in practice that's the lenders concern whether the house has that value for the loan they are giving. So they would like to hear the professional's opinions. But the mostly it is market driven.

My home is on the market and appraiser usually sees what other houses are similar in the neighborhood, how much it is up for selling and month ago, two months ago, how much it was sold. And that's all market driven.

But sometimes these people come in, they measure how many square foot it is and trying to based upon quantifiable and the age of the house and the roof condition or whatever and how neat the house is, they place that into factor.

But let's suppose I don't care about the condition, how it looks, but the location is very important for me. I like the house and I'm going to pay the market value.

But the appraiser comes in and based upon whatever his or her opinion may give me so Low value that I would not qualify for the loan that I need from the bank. So why do we have to use this professional appraisal?

Well, thank you for the illustrations of examples of what are the factors because indeed that's a part of the factor in terms of the square footage, the qualifications of the home in terms of amenities. These are all part of the professional licensure responsibility. We have a standard which we call the uniform standard of professional appraisal Practice.

The US this uniform standard looks at marketing. It does look at amenities. It has a variety of components that we are as licensed appraisers must understand and must apply. Those who are not licensed unlicensed individuals may only look at one factor or not factors that are appropriate when a market is looked at.

We have that continuous concern and they are responsible to notice the change in our market. The factor of looking at a home in one community and going 10 miles away instead of using the homes right in the vicinity.

Those are things that we look at and concern about when a person is evaluating we and I say we as the investigators are looking how a person is actually conducting their appraisal report. But. But these are all factors and you're indeed correct that there's more to it. And I am very confident that our licensed appraisers look at all the different components those who are using their appropriate standards.

I have one more final question. That is, is this appraisal required? Did you say by the federal law there has to be a professional appraisal for the real estate transaction.

So for licensed appraisers it is conducting federal. It is only for federal transactions.

What do you mean federal transactions?

So any like a mortgage, those are federal transactions. Anything outside of that I do not have the jurisdiction over. Those who are using who are non licensed conducting appraisal work is not if they conducted a federal transaction then they're they're under our jurisdiction.

But if they are conducting if any of my licensees they are all anything they do they're required to do to use our uniform standards of appraisal work. And so with that said anyone who is conducting a mortgage that is typically what we consider federal transactions. Illustration is like a veteran any mortgage lending that type.

What do you call Fannie Mae something the Federal Government approves of the loan.

Any. Any federal under federal. Any under federal transactions. So there are scenarios that it may not and when you say Fed Fannie Mae there may not be. But if it's not a federal transaction that is what my jurisdictions is underneath.

So any regular non federal loan financing is required. Then this real estate if we our state gets rid of it still we are not violating the federal law.

If you're not conducting a federal transaction. Correct. If you're unlicensed we do. California right now is not a mandatory state. 70% of our of United States. All the other states are mandatory. California is one of the few that that is not federally mandated. There are three categories.

There is mandatory states, there is non mandatory and then there's voluntary. There's three states that says voluntary if you choose to or not. There's three. There's that category. So California is part of the few states that still is not mandatory.

So we are what is being sunset right now? We are trying to reevaluate to continue or let it to sunset. What is the what is coming up for sunsetting?

The bureau is coming up for sunset. You're looking at the procedures and the functions of the Bureau to determine should this Bureau continue right now the requirements that are set in state law, they sunset on January 1st of 2026.

And so you're making the determination should a Bill go through to extend sunset, I mean extend the regulation of this profession through the next four or however many years you determine to make.

Thank you. Thank you. Vice Chair Choi. Senator Smallwood-Cuevas.

Thank you, Mr. Chair. And just reflecting on the line of questioning we just went through, I wanted to start with a question for you, Ms. Jamaat, but I just want to note there is more than a little bit of documentation about racial discrimination in housing.

I want to just read just a very simple Google racial discrimination and it explains what redlining is, right? In the 1950s, redlining was a discriminatory practice that denied black Americans access to mortgages and investment capital. The Federal Government created color coded maps that identified neighborhoods as hazardous or too risky to ensure mortgages.

These maps were used to guide lending and decisions that isolated and disinvested in black communities and robbed black families of wealth for generations. Up until the 1970s, FHA, 90% of all home loans went to white Americans.

In my own community, which is now called the black Beverly Hills, it was a segregated community up until the 1970s with racial covenants in which my neighbor who was the first black man on my block had to have a white co worker come from the factory, Lockheed Martin to purchase the home and then give him the keys because the real estate agent would not sell to a black buyer in what is now the Baldwin Hills.

So there is a very long documented history of discrimination, of robbing communities of wealth. We just returned Bruce beach to a family in Manhattan Beach which had been robbed of their valuable land for, for many generations and decades and California helping to make that right, this Legislature. So I just want us to always deal in facts.

I think there's a lot of misinformation and there's a lot of trickery being played to ask questions on factual, scientific, verified and certainly the human toll has given us a real ground truthing of racial discrimination in housing.

And it's not a federal issue, it's a California issue, it's an LA issue, it's a every county issue because unfortunately our government, we started with some pretty egregious original sin of slavery. And we're not going to go into the long political history and living history there.

But all that to say I appreciate the work of the work that you've been doing. I also appreciate the focus of The Biden Administration on this issue. Really interested to hear more about Bill AB 948. I remember that Assemblyman Holden moved and I wanted to see more and hear more about what have been the steps for implementing that.

I know that Bill was to help even close even more of the racial gaps. I think that as we look at probably the largest building effort in a generation, particularly in a historic black community that has certainly experienced all of the things that I've talked about, we know how predatory this process will be.

And I think AB 948 and all of the steps that you're doing will help us to. To address it. So if you could talk a little bit more about what you're doing there and how can we make sure that the evaluations are done in a way that protects our homeowners, but particularly those that have been historically discriminated against in this particular sector.

Yes, thank you for that question. Because indeed, as I mentioned in the opening started right off the bat ran into the issue. If we're going to have a training, a requirement for appraisers to learn about cultural competency and elimination of bias by our current trainers.

I wanted to make sure that the trainers are culturally competent and have the knowledge base to create those trainings since it was new and and I so three months into my job we did the educational symposium. I invited experts throughout California.

I brought in the civil rights Department, a number of people to help develop those professors who have been doing it for 20 years. I wanted them to help bring out true skill sets that can help our vendors conduct those classes. And that's what we were first doing. We spent a lot of time and it was great.

Several states, as I mentioned, had not had attempted to do this and so we were proud to be able to produce that type of support. Additionally, I have been active with the national diversity and equity inclusion that has been developed through PAVE and I was invited to speak and present and I supported that.

I was in San Diego at a national black association and told them make sure you come to this event. And I was really proud to see that a number of people drove to from San Diego to Sacramento to ensure they came. It filled up the Holiday Inn. I was extremely proud of that event as well.

We have participated through a variety of organizational structures. The Women's and I'm meeting next month with the Southern Initiative of Women Appraisers in Southern California. I met with the Northern California. We have been actively. I have participated in the Media Expo.

There was a media expo that had all variety of means of which I knew that once we start rolling out information, rolling out communications, I need to know how to reach everyone. And so that's one of the things I did. I have a database of all the medias within California.

The biggest thing that I feel that is really the change maker is within the the newly law that was passed to bring in 100% there was a barrier honestly for entering into the profession. We had one entryway and that was the supervisory model, the supervising model.

And I found out if I went to appraiser, they said, I said how did you get in? My uncle, I talked to another appraiser, they say my cousin. So it was clearly the supervisory model that created a barrier and not probably intentionally, but the supervisor model in the end was a barrier.

And now we have as of 2024, two extra entries. And that's what the, when we talked about 100% because you have to have experience to, to apply to get your license, so education experience and then the national exam. So we said we, we need to make more entry levels. And so that's what we did in 2024.

We were able to get 100% of access. So now we have it on paper. As I said, I'm looking for meaningful reform. And so once we made those opportunities, we have now become active in working with the community college base which is one of our best ways to access a diverse population of people.

And so we have been communicating with them of how we can assist and find ways to make sure that that experience is accessible to all. And that is key. Access for all creates a whole nother community amongst our state and that's what we've been working on.

Thank you and I appreciate that. And I want to say if we don't know our history, we're damned to repeat it. And taking to account the data, the history and then looking for ways to create higher standards in this space is incredibly important, particularly as we see a people of color majority in California.

We want our majority to be homeowners. We want them to build wealth, we want them to be able to reinvest in this economy. And they can't do that if they are discriminated against, if their homes are undervalued, if there are practices that are in what we used to call the FBI, the father brother in law system that does not allow for real skill sets, real knowledge and fairness to be made available to every homeowner.

So thank you for that update and looking forward to seeing the outcomes of what this new Bill is going to do. In terms of strengthening the participation of everyone in our housing market.

Thank you, Senator. And along that, that line or those lines, you kind of reminded me of a book that I encourage to anybody who's interested in the history of this, which is the Color of Law or Forgotten History of How Our Government Segregated America, which also covers a chapter and it covers East Palo Alto, which is a community that I represented, had the privilege of representing my first six years in the Assembly before it was removed and redistricting.

So totally agree with everything you said. Appreciate that. I believe. Senator Grayson, you're Next.

Thank you, Mr. Chair. And Madam Chair, quickly. I believe you are very appropriate guardian or one of the guardians, especially in the housing industry, making sure that we protect equity and address the issues that my colleagues have brought up. So thank you very much for that.

However, your ability to stay solvent is very important to you, being able to have that strong voice and guard those particular issues and areas. I've noticed that obviously at the very beginning of the report, it shows a significant decline in revenue in.

It says in the report that housing market as well as mortgage refis were after Covid were the primary issue. But then further in the report on page 22, it talks about the decline, the significant decline in Members or appraisers as far as certified. So as a matter of fact, it was across the board, the decline in numbers.

Literally there was not one category where there was an increase. Every single one of them are negative. So having said that, AI its role and what it's doing. Is AI creating an inevitable end to. To your profession or to the profession and to what the Bureau is facing as a huge obstacle?

Or is it possible to keep AI as a tool in the toolbox that is a partner or that is a resource for appraisers and not a replacement for appraisers?

Well, you just took what I was about to say. Indeed, thank you Member for that question. Because when I came into this industry, it was a little bit of a concern amongst the Members and we have seen a tremendous growth toward embracing the. The new technologies.

I think that happens in every industry that everyone has have to either make a decision of how they embrace new technology, because if you don't, we can. We. We have history books too about IBM who. Who said no, we're this and. And got left.

So we have seen a tremendous change of more and more appraisers embracing AI, embracing the different various new technologies. We have hybrid, we have desktop. We have lots of different tools that not replace. They do not replace, but actually are part of how we refine ourselves, how we get better at what we do.

So that's the one part. So there is no concern or fear about that. You're concerned about the decline. One of the things that we have noticed, it has been a true realization for us that there's a graying population. And so you have seen and I've looked at the numbers, it's a steady.

I would except for their trainees because we've seen again, the barrier is a connection there. I see that if there. And there is that a higher percentage of trainees leaving because they're like, hey, if I have to get experience with folks who are not giving me experience. So that's that. So that's clear.

And there is a consistency in that. However, we're marketing, we were partnering together, said if we do have a graying population, then we must be working on things to meet it.

One of the things that gives me joy is that I seen in our labor statistics that there's a 5% expected growth in this field of appraisers and assessors, a 5% between 2022 to 2032. So the expectancy is that the industry itself would grow and we must have people to meet that growth.

So with that in mind, we believe while there is a steady decline, we are working toward and watching the numbers very closely. Also, our budget shows that we've never been lopsided.

So we watch it very closely to ensure that as we aggressively moving toward finding more opportunities in our industry for more people to get in, we'll meet that timeline of which when I decline, as well as the market growth, that's our expectation.

It's really the hope that that practicum is going.

To build this population, it's going to be easier. They don't have to go through that supervision model as Chief Jemmot said. And more IND individuals would enter the industry because there's going to be a need for it. So the needs there, we just need to get the individuals into those training programs.

Thank you very much, Assembly Member Pellerin.

Thank you. Also piggybacking on the solvency issue. You know, it makes sense that your bureau is going to attempt to seek federal funding since you're charged with enforcing these federal standards. But we all know there's some tension right now between D.C. and California.

And you know, considering the primary business of the President is real estate development, how probable is it that the Bureau will be successful in getting federal funding and whether other options are you exploring that are not a license increase or fee increase?

Well, indeed we have explored federal and we have received a grant. This is our first in the history of Bureau that we have received a grant within and is we we received it this year and is a three year grant. So I'm pretty proud of that that we're able to achieve federal access.

And so funding is something that we are looking at a variety of ways in terms of continue to find other if there's any other type of funding opportunities, grants. We would also additionally look for those as well. But yes, there is a new tension of course.

And so we are, it's unknown as all of us are just navigating together with that. But the reality is whatever we can, we will. And I'm glad to say that we got in and received funding already.

And how much was that grant for?

So the grants is a three year is up to 120,000 each year. And so we have a cap at each year 120,000. This year we actually receive, we received 76,000.

Great. Thank you very much. Assembly Member Irwin, did you have a question?

I did, thank you. I represent the Palisades area and we have a big concern about predatory buyers there that you know in the weeks and months following the fires that homeowners will feel pressured to sell their home. So I came in a couple of minutes late.

I'm not sure if you have addressed this already, but what is, what are you doing to what is the Bureau doing to ensure that predatory buyers are not taking advantage of the homeowners after a disaster?

So there was a little bit of discussion that we did create a consumer guide to assist the consumers in the appraisal side of managing making sure there's if they have any Questions, concerns about the appraisal process. They can call our line. We have communications with them.

The real thing that I'm glad you brought up again, because I do want to emphasize that we do not have jurisdictions over unlicensed appraisal work. There can be appraisal work done. Again, because we're not a mandatory state.

There can be unethical practices that's not in our jurisdiction, and we cannot do anything about it except receive it and give them direction of how they go through civil or criminal procedures. But we have no authority over unlicensed appraisal work.

Are, are you seeing in these disaster areas a significant number of unlicensed appraisers?

So there's always, because we're not in a mandatory state, there's always going to have the opportunity right now. And, and this is the little bit of the reality for us as appraisers, because it's a, it's a delay, the selling and buying. It happens initially, but when it comes to, down to the end of appraisal, the.

That's when the final end that we'll get the complaint back. So buying and selling is a little bit of especially hard lender sales. That's a real opportunity. If it's not done by a licensed appraiser, that could possibly happen. So again, we're not a mandatory state, so it's legal to have someone just go up to someone.

And we, of course, in our consumer guide, we did give them some questions to ask and things to challenge them to make sure they can understand their rights, but we have no authority over that. If it did occur.

And, and how did you, how did you spread the information out about, I mean, where were the consumer guides so this, were they offered to all the homeowners in those areas or renters in those areas?

So it's been really great. Department of Consumer Affairs has partnered with the state websites and then the DCA website. So we have that and then their own internal website communication. We have actually, I know Department of Real Estate has gone down and presented information to them and we have offered our information to Department of Real Estate.

So that has been what we've done so far. And it has. And also even in our database, if they go to renew their license, it'll pop up. If they're part of the identified zip codes, it would give them communications that you have been, you have the authority under the Executive order to defer your fees, things like that. So we have that kind of support currently.

Thank you.

Thank you very much. Any additional questions from Committee Members, I'm going to turn over to Chair Ashby.

Great. Thank you very much, Chairman. So just a couple of things, I'm going to try to condense a couple of of thoughts here. First of all, Chief Jemott, I really appreciate and felt tremendous pride Welling up inside of myself as you walked us through the work you've been doing to address the long history of inequity in real estate appraisals. So feel proud of my state.

Feel proud of you feel proud of the Department, proud of the work of this Legislature as you sort of walked us through how California is leading in that space and you as our delegate for that work. So Chief, good work, Good work.

Keep, please, please keep going forward as fast and as mightily as you can on all of our behalf. That that's really important.

And then secondarily I wanted to say, you know, I introduced a Bill into the FIRE package that touches a little bit on this, probably a little more relevant for the next panel, but everything that the real estate community does, does include the appraisers. And I want to preemptively say to you that I appreciate the support that I know you will give to that effort as it moves through the Legislature.

And, and then more importantly, an implementation that addresses the various business, professions and economic development components that are happening in the fire area, including making sure that we protect hard fought generational wealth that, you know, we don't want folks to walk away from because they received a predatory offer, whether that be from real estate or from a faulty appraisal.

So I want to say to you, thank you so much for that and for, for being a good partner and coordinator moving forward with our staff, which is ultimately the way that we reach out to you is, is through them. So, and then I'm going to try to put a couple of things together here.

The part in my mind that I have difficulty remedying with this board sometimes is the cost of the fee, license fee. And so I just want you to speak to it a little bit. I know it's a small group, which means that it's a bigger fee. Simple, simple mathematical equation there.

But can you just share with us in this hearing some of the things that you're doing to keep that fee Low or to maybe reduce it or to do operational efficiencies in other ways. And then maybe Director, you can embed in that you started to touch on this some of the components about the structure of the agency.

We've done a little bit of teeter tottering with you in, out, in out which works best? What do you think is the most efficient, especially from a cost standpoint model for your entity in the bureau or standalone or standalone in the beer.

We've had like these three different types and I'd love to know from you all what you think would be the best way moving forward as well as your strategies for keeping costs lower or strategies you may have already put in play or how we're going to address that, that kind of hefty fee.

Bottom line to my question is these are hard working people that do this job and it's a tough job. And Senator Smallwood Cuevas and I were commenting on how much we loved your natural optimism for the industry. We're hopeful. That sounded like lots of new purchased homes and a big need for it and we love it.

And your natural optimism on a AI too, having it be an enhancement rather than a replacement. So I love all that. Bearing all of that in mind, talk to us about how we can support these hard working appraisers across the State of California, not overburden them.

So I'll start really with just the placement of the bureau and the in or out. And so I think one thing to look at is with this bureau no matter because the, the biggest thing I think when you're looking at them as to where they should be placed is looking at the pro rata. Right.

Because that's the, the issue that would potentially people I think will think would change. But I think from the perspective of the bureau and the functions and the services that they receive from like the Department of Consumer affairs, no matter where they go, they're going to have to pay for those services.

So if they're with the Department of Consumer affairs, whether they're with the Department of Real Estate, those services are going to have to be provided to the bureau. So I think we're happy to work with you kind of through this process and looking at what are the pros and cons of going to either of those entities.

But I think overall the fees are still going to be there on that side of it. I think as far as where they belong within like the new, the new agency they are with the Department. So they will go with the consumer protection agency and the reorganization.

And then I think definitely Chief Jemmott can talk about the fees. They are one of our smaller bureaus. And so with those smaller bureaus because of the cost just of doing government, those costs do increase.

But they have done a really good job of being like, like Chief Jemmott said of keeping steady for the last Several years when we thought, I think back when we were here with the last sunset, I thought we'd be here for a fee increase this time, honestly.

And so they've done a great job of maintaining their funds and keeping them going through this time.

I think it's going to improve with hopefully if we really our hope, right when we were talking about being hopeful, if they get the increase in licensure, that's going to be able to maintain those fees to where they don't have to increase into where they keep them at a lower rate. But I can let Chief Jemmott talk about, like, really what those fees are paying for.

Indeed. Thank you. It clearly is something that if we couldn't, if we could do it free, I love nonprofits. You know, we can give it away free, keep people going. But the reality is that we are, while we're not in it for profit, we are in to ensure that we get quality of service.

And we should never consider money to be cut back to and take away quality of service. And so that is the key. So we're always like, for example, in our database, we're trying to figure out, can we do some online chatbot, you know, that they can just call in and technology answer the question.

We're in the process of that. We have a strategic plan coming up in April. So we're thinking about all these different product processes and ways to streamline, to cut back, to design ourselves, to be efficient as possible. Lean and mean has always been the way state government should work, and that's how I see things.

And so we have identified as much as we could in terms of internally, how we never spin over, that we need to. We are very, very financial conscious at all things we do. And so the fees itself, the operation, as our Director said, operationally, we've looked at everything, but we will continue to look and find ways.

If there's anything, we will do it, because that's how state government runs. That's the best way for state government to run. So indeed, that's our goal. Our fees are truly part of the process. Internally, we have in support, we have enforcement. We have a lot of work.

When we do, when we try to make sure that if someone's not doing their job, we want to be able to get to it and efficiently respond to it as best we can. We've had some, you know, staffing opportunities. And so we, we. We've hired consultants to help us get it through because we're trying to be efficient as possible. So, yes, I would, I would say you can be confident that that's what this bureau is going to do with the fees.

Okay, that's a great answer. Let me ask the 800 pound elephant in the room question to both of you. Should we be a mandated licensure state? Thoughts?

We're happy to work with you on that. I think definitely when you look at the really where this bureau is and that they are a consumer protection agency, I think we would be happy to discuss that with you because as a non mandatory state they, there is a, a group of individuals who are out there practicing without a license, without the public being able to, to do anything about that.

Right? When they have something, an appraisal that is fraudulent and an appraisal that is undervalued and where do those individuals go? They only have the civil courts to go to.

So it's something I think as you heard in, you know, Chief Jemmott earlier, it's something that comes up a lot because individuals come to them and then they can't assist those individuals. So I think from our perspective, we're happy to talk to you about that and see if that's something that the Legislature would like to take on.

Yeah, I'm not, I'm not asserting a position, but wanted to ask the question of the two experts in front of me. I'm sure there are many experts behind you who also have opinions and thoughts on that topic.

But I, I would say as we move into this next phase and, and we work with our teams on what this looks like as we poll 774 I think that's the right number together. Could we draw down costs for people? Could we have operational efficiency? Could we protect consumers better, which is ultimately what all of us are up here to do?

And how do we capture the natural optimism of the things that you all have discussed to help drive our real estate market and our housing infrastructure and protect people in vulnerable positions like Los Angeles that has suffered mightily here under these fires from predatory practices. That's at the end of the day, my, my goal. So appreciate you both being here and all of your hard work.

Thank you. Chair Ashby. All my questions have been asked, so appreciate the robust dialogue from colleagues and all the answers that you provided. And I want to turn it over to anybody from the public who might want to come and make comments for two minutes each. Don't feel like you have to use it. Go ahead.

There's a lot of subjects here. Mr. Chair. Thank you, Mr. Chair and Madam Chair and Members. Mike Belote, on behalf of the Appraisal Institute Government Relations Committee Chief Jemmott, the Department and the Legislature is to be commended on the efforts to eliminate racial bias in appraising. We were proud to support the Holden Bill and we think it's moving in the right direction.

Here's the problem with the system. There is a structural disconnect between what the law requires and the amount of work that is out there for appraisers. The law, as both Ms. Kirchmeyer and Ms. Jematt noted, requires a license or certificate for a federally related transaction that is not all mortgages and it is certainly not all real estate.

It is a very small slice of the appraisal pie. Most of the growth in appraisal is in non federally related transactions. A property tax appeal, a portfolio evaluation, an expert witness assignment. These do not require a license. So what is happening is we are seeing a steady decline in the licensed population, approximately 50 or 60amonth.

And as you noted, Senator Ashby, it's arithmetic. If the denominator is the cost of the program and the numerator is going down, the license fee is going up and the appraisal license is one of the most expensive licenses in California government. It is approximately what I pay to the state bar. It's way out of whack.

I'm here to tell you hope we all hope. My Association hopes to gain Members just as they hope to gain licensees. But we are seeing a steady decline and the growth doesn't require a license. So I would urge you not to kick the can down the road.

It's time to understand that the licensed population is declining because of the market and because of technology and hope that it will go up. Isn't going to work. So let's address it forthrightly. Let's talk about the costs and see what we can do together.

I am convinced and have said this before, that every licensee in California, pardon me, is being charged a $400 renewal fee that is not authorized by statute.

Thank you, Mr. Beloit. Thank you. And I have no doubt you know how to continue engaging with us as we go through this process and I. Look forward to it. Thank you, sir. Any additional questions or comments? Comments from the public seeing? None. Thank you so much, Ms. Jemmott,

Ms. Kirchmeyer, for participating and we're going to move on to the next entity. Just a soft reminder for folks that we've got three more entities to discuss today. I love the energy that folks came into this first hearing with.

We're going to hope to wrap up by noon, but we'll see next we will be hearing from the Department of Real Estate. I believe we have Real Estate Commissioner Chica Sundquist and Chief Deputy Marcus Macarthur here to testify on behalf of the Department. Ready whenever you are.

There we go. Now I'm on. Thank you. Chair Ashby, Chair Berman and Members of the committees. My name is Chika Sunquist. I am the Real Estate Commissioner of the Department of Real Estate. With me is Marcus McCarther, the department's Chief Deputy Commissioner.

Thank you for this opportunity for us to provide information about the work being done by the Department to protect consumers and real estate transactions. The Department of Real Estate's mission is to safeguard and promote the public interests in real estate matters through licensure, regulation, education and enforcement.

Our role is to ensure that licensees as fiduciaries follow the law as they guide consumers through real estate transactions. And we currently license around 430,000 real estate brokers and salespersons.

If a property is in a new home subdivision, it's our role to ensure that the consumer has information about the subdivision through a document called a public report disclosure so they know about what they're purchasing. And this is particularly important as often the homes being purchased have not been constructed yet.

Last year we received approximately 3,000 applications for public reports. The Department is composed of about 383 positions housed in five offices throughout California, including five exam centers. The department's budget is approximately $65 million annually, solely made up of special Fund resources.

Our approach to consumer protection is to engage in preventive and proactive measures and then pursue enforcement actions in the most egregious matters. I think the Department's response to the recent fires is a great example of our work in enforcement.

We have done significant consumer and licensee education and outreach related to unsolicited below market value offers to purchase properties from fire victims. We have provided toolkits to local community groups and media outlets within the affected areas with information they can share with their Members and with their communities.

We have been connecting with our stakeholder groups to learn about immediate and future needs of licensees and consumers and discuss potential future consumer protection issues that they're experiencing now and that they might foresee in the future. And we are collaborating with our law enforcement partners on cases involving real estate licensees, sharing resources and sharing our expertise.

Lastly, I'd like to take a moment to highlight some additional accomplishments the Department has achieved in the last four years in pursuit of our vision of being the champion for public protection in real estate.

The Department has three endowments managed by the California Community Colleges, California State University and University of California to support real estate professorship and research in California real estate matters, to support students studying real estate and to expand access to quality real estate education.

One example of our Recent work has been with UCLA to identify which courses being offered by UCLA meet the state's real estate course education requirements for becoming a licensed real estate salesperson and broker. To provide a clear pathway to licensure.

These courses are now recognized by way of an articulation agreement between the Department and UCLA, and UCLA has updated their online materials to ensure that both current and prospective students students are aware that completing these courses can also be applied towards the Department's educational licensing requirements.

In our work to educate Californians on the home buying process, the Department has launched our first Home California Podcast with a series of topics to help consumers know what to expect during the home buying process and to make sure they are ready to make informed decisions.

And lastly, we're fully staffed in our licensing call center since the beginning of this fiscal fiscal year and we have reduced call wait times from over an hour to just under 15 minutes now. So in closing, thank you again for this opportunity to share our record of strong consumer protection and we look forward to answering your questions.

Thank you very much. Any additional or any questions or comments from colleagues on either Committee, please.

Yes, thank you Commissioner for coming before us and Deputy Commissioner, I appreciate it. As I mentioned earlier, I've had my real estate license and broker license for probably a lot longer than most into 30 years. And I have seen the evolution of of equality has taken steps further and further. And one of my cities that I represent there was a covenant that Latinos, African Americans, Asians could not buy in that particular city.

Of course that covenant has been removed by law and we've seen now an influx of people in the real estate industry that look like America, look like you and you, the deputy and people on this panel. I was very proud to see that. And I've raised five children because of my real estate profession.

And diversity is something that we've always had in my offices. So I want to thank you for your work you do. Let me switch over to your licensing and practice and so on. It's been fulfilling that.

It's been challenging over the years for every real estate agent that I've known, that they've studied hard, they've made sure that they've realized that having that license is a livelihood and taking the classes at SC that I've done others, UCLA. Now you mentioned wherever it's been, it's been with the goal to be the best professional.

And I will tell you this, to be a Realtor is a lot different than having a license. The Realtor you have, you swear to code of Ethics and understanding that under law you've got to have that fiduciary responsibility yet taken seriously.

And to be able to realize that the Department will remove your license suspended or remove it depending on an infraction. And the audits that you've done in offices, people don't realize that you get an audit from a Department of real estate. You're taking files out that are pretty intense and they go over every contract and every detail.

And it's your Department, it's your leadership that's provides that. And I salute that. So I'm very pleased and honored that we have such a professional here today and representative of a very, very important agency in our state. And thank you.

Thank you, Senator Archuleta, any Senator. Smallwood Cuevas

Thank you for your presentation. I just have a couple of questions for you. And just following up on the wildfires and you know, my district is just east of the Santa Monica and the into the Palisades area. But I am, you know, home to the Baldwin Hills area. We have the largest urban oil field.

And we also have this beautiful green open space between the oil fields and 6,000 homes. And so I'm, you know, this is lessons learned and trying to understand more about how we protect residents.

But if you could talk a little bit about the email address that you established to deal with the unsolicited property offers and the price gouging. I'm really wanting to understand what is the current utilization of that.

How are you pushing that out given how far flung so many of the residents are and their access or lack of access to, you know, stable Internet and computers and so forth. And also how are you enforcing it once someone has called or emailed. Can you walk me through what those steps look like?

And have there been any reports of malpractice? And yeah, just trying to figure out, given also the scale, how does this compare to other fires and what does that look like in terms of your infrastructure and the operations.

And then my next question is are you all working directly with local city attorneys, civil rights offices, consumer just concerned about the sort of connective tissue between the state and local entities so that folks who are experiencing this on the ground that there's some way of making sure that compliance is happening aggressively and swiftly.

And then my final question has to do with affordability. Just overall, you know, we have an affordability issue in the state. And, you know, real estate is one of those places where the you're at the tip of the spear when it comes to how can Californians afford to really participate in land and property ownership.

And so if there are just looking at how your Department is operating and functioning and the services that you're providing and what you're hearing on the ground, what would you say are key ways that we can strengthen affordability for Californians to really participate in home ownership and in in the services that you provide?

Thank you very much for your questions, and if I miss a portion, please let me know. Starting off with affordability, you know our role as a regulator that oversees licensure of real estate agents and loan originators and property managers, we really don't have a lot of input in terms of setting affordability standards or measures in those realms.

But in terms of our response to what we can do to help consumers and what we've done in fhiers Start going down with the email. The email was one thing that we did to provide another access point to the Department.

We have offices in Southern California, one in Los Angeles, one in San Diego, where people can come in if they are seeking our help. We also have our normal call line. We also have web forms through licensing.

But for in particular, we wanted to make sure that we had a single easy access point for those who do have Internet access to be able to email us questions or concerns or voice their report violations of price gouging or unsolicited below market value offers. In addition to the email, we set up a web form online again another just easy access point to the Department.

And then we have staff called it internal strike team, but we have a group of staff Members that are dedicated to responding to those emails within a very short amount of time, referring reports of violations to an enforcement team comprised of investigators and managers and legal staff that are dedicated to addressing violations that are being reported against licensees.

So again, the email is just one additional contact point that we opened up just so that people knew just email Dre, you know, lafiresre.ca.gov, it's an easy way to get to us. And we have again very responsive staff who are monitoring that email and web form very closely.

In terms of bit about the scale. How many folks have accessed you through the various entry points?

Yes, at this point I believe we're at about 40 odd. 40 to 50 inquiries received through that email address related to licensees who are seeking help to extend their renewal timeframes, examinees who are seeking to reschedule their exams because they've been impacted via fires, those who have also wanting to report violations of price gouging or by licensees.

So from media outlets, community groups. So it has been a wide kind of variety of topics that have come in through that email address, which we're happy about.

It means that we've been able to socialize that email address and that web form so that it is something out there and people know it is an easy way to contact the Department related to any resources we can provide in fire response. In terms of scale with other fires, obviously this is a hugely impactful disaster.

And I think we have learned a lot of lessons from other fires and where the Department can be a resource and where our licensees can be a huge resource to consumers who have been affected.

We've spoken to regulators in Hawaii to learn what they experienced following the Lahaina fires and what we could take away as a state regulator to improve upon our services or improve upon consumer protection efforts.

And we are working with law enforcement agencies directly to the Attorney General's Office, the LA City attorney's office, to be able to refer complaints very quickly, expeditiously, to work on issues immediately, to share resources, to share investigative efforts. So there are direct connection points that we are regularly working through with them, particularly related to the fire response.

Thank you, Senator. Any additional questions for Members of the Committee? Seeing none. Chair Ashby,

Thank you and thank you both for being here. Appreciate it very much. I guess you know Senator, Smallwood Cuevas did a great job of running through the fire issues.

We do have SB641, which is I want to thank you for supporting and thank you for helping, which will codify this beyond just this fire situation and will allow us to use this moment to learn and grow and do better as a state and have those kinds of communications in place so that we don't have to wait for an Executive order in the future.

So I am very proud to stand with many, many co authors up here on, on that particular Bill. And I appreciate you. My question is really a simple one. Your expenditures have been notably different than previous years. I'd love for you to walk us through your finances here.

Meaning how did you how did your expenditures go up 25% and why are we down to one year of reserves and what is our plan to not have that happen again?

Yes, certainly want to acknowledge that we are aware and in terms of expenditures, they fall into two buckets. One are the expenditures we can control and then there's the other set of expenditures that we cannot control.

So within the expenditures that we can control, we have over the last last few years been very conservative in our spending, ensuring that every expenditure has Executive level reviews up through management and Executive level reviews to make sure they are mission critical costs. We have been limiting our travel to mission critical travel.

We have been ensuring that our training is statutorily mandated training and we're trying to limit training to only those that are offered through our very expansive learning management system that has over 4300 trainings on there so it doesn't add additional cost to the Department.

Every vacancy that occurs, we review that vacancy for its highest and best use and determine whether or not we can defer that hiring within that position based on workload needs while still maintaining our high levels of consumer protection and customer service.

We've been evaluating IT systems and programs and looking at where there might be opportunities to consolidate software or licenses or I'm sorry, I'm not technically savvy at all the IT related lingo, but being very thoughtful in our IT expenses and where we can consolidate costs there in terms of the costs we cannot control, those are where we're seeing the increases.

So we're seeing increases in salary and wages, retirement contributions and expenses, expenses, facilities costs, you know, the pro rata that we pay to different state agencies. Just General cost of doing business has gotten more expensive. So within the areas that we can control, we have been doing our best to limit our expenditures and reduce costs.

Thank you Chair Ashby. Kind of a follow up to some of the conversation that happened with with the Bureau of Real Estate appraisers AI and the impact of of AI on the field. Y'all put together a report in 2024, kind of the Prop Tech Report.

And I was just curious, what efforts have you made since the the 2024 PropTech report to regulate AI and other emerging technologies in the real estate sector? And what, what problems and potential consumer harm have you seen arise in recent years and is there a place or a need for the Legislature to intervene at all?

Thank you. We are very proud to have helped Fund that report. We believe it was one of the first of its kind in the country and it really has been a guiding point for us to learn about where technology is being used.

Obviously AI is the current focus, but where technology is being used with licensees, where it's been a benefit to consumers, where there are potential areas for consumer harm. So I, I understand there is a Bill put forth being proposed right now related to use of AI in pictures and photos and listings and such.

So there are a lot of opportunities for AI to be of use and be of support to our licensees. But I always come back to the fundamentals of the real estate law that say that the human being is responsible for being a fiduciary to clients and technology is a resource and a tool.

But we are always mindful of how things can change very quickly within the real estate industry, especially as we saw during COVID with everything moving online and going paperless.

So we are on constant communications with our stakeholder groups towards learn what they're seeing in technology where they're maybe just dipping their toes in versus where they have fully embraced technology and then learning from one another where there are arenas that the real estate law has already set forth clear expectations for consumer protection.

But that being all said, would always look forward to more conversations about where, you know, there could be additional enhancements to the real estate law where there are new technologies emerging that may affect consumers in the practice.

Great. Thank you very much. Any additional questions or comments from colleagues before we turn over to the public? I'd be remiss if I didn't shout out my mom, Lucy Berman, who's a Realtor in her third career in her life. Realtors work too hard. You all work too hard. You need to stop answering the phone on Sundays.

Just answer when your son calls. Don't answer when clients call. But thank you to the Realtors. Now, anybody from the public want to speak of the two minutes, please go ahead.

Thank you, Amy Garrett on behalf of the California Association of Realtors, including your mom, thank you so much to Chair Senator Ashby and Assemblyman Berman for the opportunity to speak today.

As the state's largest trade Association, we're comprised of nearly 200,000 real estate licensees regulated by the Department, and our Members are among the most active in terms of practicing real estate as a career within the DRE's licensing pool. As a result, Sierra has a unique perspective on the work of the Department.

We very much appreciate and thank Commissioner Sundquist for her strong leadership and overall, the Department is functioning very well for our Member licensees. During last year's state budget process, we engaged in a productive discussion with the Department regarding their proposed licensing fee increases and raised fiscal transparency concerns.

And as a result of those concerns, CAR did not object to the Department's fee increases and supported the additional fiscal transparency measures that were enacted into law to allow the public, including our Association, a better understanding and a fuller understanding of the Department's finances.

We urge the Department to continue to prioritize transparency with both the public and the Legislature. And while the Department faces fiscal challenges today that are not dissimilar to other departments, we still recall the fiscal problems and service issues that arose when the Department was a bureau within the Department of Consumer Affairs.

CAR concurs with the report that states the welfare of consumers is best preserved under the presence of a strong licensing and regulatory structure to oversee the real estate industry that can sustain its existence through license, fee and other forms of revenue.

For these reasons, and despite the current challenges, CAR wishes to reiterate our strong support for the Department and agrees with the Joint Committee's recommendation that the Department continue in its current independent form. Thank you.

Thank you very much.

Thank you, Mr. Chair and Madam Chair Mike Belote. For a different client this time, the California Mortgage Association. We are mortgage loan originators. We are a relatively small portion of the 400,000 licensees within DRE, but it's a very sensitive area. We are fiduciaries to both the investor side and the borrower side.

It's critical and bad things can happen to people. And I'm here to say that the Department is to be commended for the outreach they do to the mortgage area of the practice. They get out, they talk about where the problems are. They're accessible, they're collaborative.

I have always felt, over 35 years now, that this Department may do the very best job in California of having a consumer focus, but also paying attention to the customer service side for the licensees. They're to be commended, especially in the mortgage loan area, which could be so sensitive. Thank you.

I think we're going to end on that high praise. Thank you, Commissioner Sunquist. Thank you, Chief Deputy McCarther. And next up, we have the veteran, the Veterinary Medical Board. Board President Maria Preciosa Solacito, Vice President Christy Pawlowski and Executive Officer Jessica Sieverman are here on behalf of the board today. Please.

Good morning, Chairman, Chair Berman. Good morning, Chair Ashby and Members of the Committees. We thank you for this opportunity to come before you and speak about the California Veterinary Medical Board. My name is Maria Solacito. I'm a veterinarian and the President, current President of the Board. With me are Ms.

Kristi Pawlowski, who is the Vice President and is also a registered veterinary technician, and our board's Executive officer, Ms. Jessica Sieferman. We would like to thank the Committee for the Thorough background paper summarizing what has occurred at the Board since its last sunset review.

We would also like to thank the Committee for the Board's last sunset Bill which successfully eliminated unnecessary barriers to licensure, streamlined the licensing process, increased access to veterinary care and improved consumer protection mechanisms. In the interest of time, we'd like to briefly highlight some key accomplishments since the last sunset review.

To streamline the licensing process, the Board created and fully implemented an interface with the American Association of Veterinary State Boards, or aavsb, to receive electronic examination results for veterinarians and registered veterinary technicians directly into the BRIIS system. This eliminated all workload associated with manually entering individual examination scores.

The Board successfully advocated for the change of AAVSB's policy prohibiting veterinary technician students to sit for the National Technician Exam. This two decade old policy was inconsistent with veterinary student counterparts and often resulted in lost job opportunities and many veterinary technician students deciding to walk away from the healthcare profession altogether.

Because of the Board's strong advocacy and active engagement with national stakeholders and state veterinary boards, veterinary students throughout the US And Canada now take the national exam, resulting in more licenses being issued and individuals entering the healthcare profession faster than ever before.

The Board requested an AAVSB agreed to also allow candidates to take the national exam on a continuous basis and if a candidate fails to be able to take it again in a shorter period. As a result, candidates can now take the exam at any time and if necessary, retake the exam in a Shorter period.

The Board also requested and the AAVSB agreed again to expedite their score reporting to the Boards. What were wait times for up to six weeks are estimated to now take less than one week. As far as enforcement goes, the Board added more consultants who now screen enforcement cases prior to submitting them to subject matter experts or SMEs.

This process has led to an increase in closed complaints, Shorter cycle times and a decrease in SME costs. The Board initiated quarterly roundtable discussions with all SMEs, which has led to stronger SME reports and testimonies at administrative disciplinary discipline hearings leading to stronger consumer protection.

The Board merged its inspection and enforcement units and implemented various other process improvements since the Board's last review. As a result, the Board increased its inspection with by 343% when compared to the initial merge and close 262% more complaints.

Last fiscal year, the Board and the Board of Barbering and Cosmetology was awarded a $600,000 grant from the California Department of Technology for the development of a mobile inspection application. This mobile inspection app, launched in November of 2024, is expected to significantly streamline the inspection process for licensees, inspectors and Board staff.

The Board also now holds regular educational webinars throughout the year covering the Board's enforcement program, board inspections, DEA processes and other topics as requested by the profession. After completing its 2020-24 strategic plan a year early, the Board adopted a new strategic plan for 202428 with 45 objectives equating to nearly 200 tasks.

With a little over a year into the four year plan, the Board has completed over half of the Strategic Plan tasks. The Board has identified more ways to streamline its processes, provide better service to consumers and licensees, and enhance consumer protection and looks forward to working with you on these areas throughout this legislative season. Thank you for this opportunity to come before you. We are happy to answer any questions you may have.

Wonderful. Thank you very much. Any questions from Committee Members? Questions or comments?

Just one. One brief one. This is an issue that comes up in my district, particularly in south central. Area where there's just a shortage of. Veterinary care that's accessible and I know you all have been trying to address some of the gaps in those shortages and particularly because as more folks are.

Leaving the field because of just the cost of veterinary school and student deaths, debt and stress. Just wondering, you know, how and what is the Board doing to encourage licensees to stay in the sector and you know, what else are you doing to outreach to communities that have an underrepresentation. In terms of veterinary service and access?

Is there something also to encourage folks. To from underrepresented communities to be able. To step into veterinary licensing and programming. In a way that helps them afford. It and be able to be certified and do work in those underserved communities?

Thank you very much for that question. I think the first thing that the Board is looking to do is to identify those communities that we can provide outreach to. Part of that is collecting the data and through HCAI they're collecting during the renewal process about the specific demographics and they've been Doing that for two years now.

And we hope to invite them back to the board to give a presentation on where those shortages are and specifically what those shortages look like.

Also, when looking at things like language barriers and representation of the certain areas, we hope to work with them to identify that and then work with them to see what outreach would be helpful for those individual areas.

Right now we're working on collecting that data to identify them and then we'll be performing more outreach to those to encourage them to be part of the field.

And what's your timeline on that? Is there or is this time bound? And what's your goal?

So we have invited HCI to our board the last couple Board Meetings. We hope to have them in either April or the following July meeting to be able to get that data and analyze it and then be able to start outreach within the year.

Thank you, Senator. Any additional questions or comments? Senator? Vice Chair Choi.

Thank you for your presentation. I heard that veterinary doctors are being threatened by another profession for their scope of practice, such as chiropractor wants to practice veterinary care with their skills. Can you explain what the situation is, whether that's true or not?

Yes, thank you for that question. I don't think it's a threat. As a profession, we also work with other professionals to be able to provide services to animals. Now, there's been a lot of conversations with the Chiropractic board and Physical Therapy Board with regards to how to better collaborate.

Now, the board's responsibility is for us to oversee consumer protection and the protection of the animals that are involved. And so primarily as a board, we have to ensure that whatever collaboration or how we are going to be working with all these other professions, we will still ensure the safety of the animals that are being provided the services.

Yeah. And as I, if I interject here, the discussions that we have at the board level, we always end up going back to our board mission, which is protecting consumers and animals, regulating licenses and enforcing the Practice Act.

And when we, when we continue with our board mission, we are always looking at how, if we have to enforce bringing them in to, as you say, the scope of our Practice Act.

In the scope of veterinary medicine, we always continue the discussion of who's going to be responsible and who's going to protect the consumer and the animal. So we have made many discussions, have had many discussions, and we will continue those discussions. And it's all about protecting the consumer and the animal.

Okay, can you tell me the makeup of the board? Are they all veterinarians or non doctors?

We have veterinarians, we have public Members, and we have a registered veterinary technician who is Kristi.

Okay. Wouldn't it be more complicated? Two different professions come in, try to protect, to provide that service for the same field carrying the animals. If that is the service that found to be, for example, effective, then chiropractic principles can be introduced in the veterinary school curriculum.

And as a consumer, when I bring my dog or cat to the veterinary hospital, then do I have to ask, who are you? Are you licensed veterinarian? Did you go to veterinary school? Or are you a chiropractor?

And the chiropractors, I understand normally it started from treating the human, not animals, and now they are trying to apply their skills to animals. But treating one specific item, but practicing the whole care issue is two different things. And I would assume that veterinary school will be about four years, something like that.

But chiropractor hasn't studied the animal for four years. So there would be some apprehension on the consumer side to rather see that professional veterinarian will utilize new skills trained at the veterinary school. What do you think about that?

Thank you so much for that. Actually, that is the concern of the board because we do believe along the same line that caring for animals and providing care for animals is specialized knowledge and training by, you know, from the veterinarians. And. But I also wanted to say that that is why we're opening ourselves up to collaboration.

So what we, we are looking for is practitioners, chiropractic practitioners or animal physical therapies practitioners, to be working under the direct supervision of a veterinarian. Because there are things that are. Veterinarians are trained for that they are not. As I always try to make the analogy, you know, the veterinarians are skilled and knowledgeable, just like a pilot.

That's. It doesn't mean that, you know, a pilot, you know, flies a plane and everything is okay. It is at that moment when a problem occurs that is critical that the decision making and the training and the, the judgment of a veterinarian is going to be valuable.

And that's why we want to make sure that these other practitioners will be working under the direct supervision of a veterinarian.

Sounds like you are embracing the expertise. Chiropractors come in and help the animals when the scope under your knowledge is beyond, for example, pain relief in a chiropractor may relieve the pain better than I can do. So if you are approaching that way, then I have another suggestion coming from Eastern culture. We prac...

We rely and trust acupuncture skills, which is Also a lot of pain relief. And it has its own practice and treatment effectiveness proven. That's why it has been practiced over generations. So maybe you can expand your generosity to other professions and try to collaborate with acupuncturists as well.

That is actually occurring right now. The approach in veterinary medicine is what we call the integrated veterinary medicine, where different modalities are being embraced.

Again, there's value to the trainings that other professional health professionals have, but it is very important for the board to oversee the fact that they're working together under the direct supervision of a veterinarian, because again, there are knowledge and skills that. And experience that only a veterinarian had gained through proper education.

Okay, just a thought. Thank you.

Thank you, Senator. Assemblymember Bauer Kahan.

Thank you, Mr. Chair and Madam Chair. Oh, did he skip? One of you did.

No, I totally did.

Allie, would you like to go first?

Summoner Macedo. Okay, please. That's my fault.

Go ahead, I'll go second.

Thank you. I represent an area that's very rural but also very agricultural. So. So there is something that, reading through my notes here that I did want to address, which is the owner exemption for veterinary care. A lot of people, when they think of veterinary care, they're going to think of dogs and cats and small animals.

What I think of veterinary care, I'm thinking of bovine and horses and things like that. So I do have a couple of questions. What specific types of owner related activities do you believe that there needs to be kind of more of an oversight or regulation on as a board or any, if that's something that you guys believe.

So currently the owner exemption is something that the board is looking at closely and looking to narrow its intended purpose. It was intentionally put in there originally for livestock and food animals. So like ranchers, so they can continue to provide services to large food animals and cattle.

Unfortunately, what we've also seen is that because it's so broad right now, how it's written, we see a lot of complaints and when we investigate those complaints, they're using the owner exemption to have the laws not apply to them.

Could you give me an example of that? I'm sorry to interrupt you.

So one of them we get a lot when it comes to. We see it in the equine world. When it comes to horse shows or polo shows, you have individuals who are practicing on equine. They're often either foreign veterinarians or unlicensed individuals.

And they are doing things such as examinations, lameness exams, nerve blocking, teeth floating and they're providing these services. We hear awful stories about how animals either are significantly harmed or had a veterinary not jumped in at the last minute, the animal would have died.

And in those cases, when we've done investigations, we found that one, they claim that they have ownership in the equine. So it could be, as you may know, you could have multiple owners for one equine. You could have 10-20 people for ownership for that.

Or they'll claim that they are providing the services to the owners, they're assisting the owner gratuitously. So when you have that gratuitously, we would have to prove that they're being charged in order to apply the law to them and take action to protect the, the patient and the consumers.

But some of the consumers are quite happy with the cheaper services and are not willing to participate in those investigations. And so we don't have evidence to prove one, that they don't have ownership of the horses or that they are performing the services gratuitously. We also see that a lot in rescue groups and breeders.

We see surgeries being done. We had a rescue group who was providing eye surgery on the bed of a foster parent's home. The animal ended up going blind. The foster parent filed a complaint against the rescue group. And because the rescue group owns the animals, they're able to do the surgeries.

We've also seen breeders who are performing C sections on animals on their kitchen tables. In these cases. The videos that we get are egregious. The evidence we get is egregious. And we think animal cruelty, we'll refer to the DA's office. Unfortunately, DAs office quite frequently doesn't take our cases. So we see that animals are being harmed. The consumers are wanting us to do something about it, and we're not able to do so.

So you're not trying to take the ability for farmers and ranchers to vaccinate their cattle or anything like that?

No. In fact, the language that we're hopeful, looking through right now, we have a Subcommitee working on and is actually going to. We're proposing to narrow the owner exemption to livestock and food animal back to its intended purpose.

So then my question would be that, you know, I grew up vaccinating cattle and my horses, and we also had farm dogs that, you know, the veterinarian would come out and they would do General wellness checks.

We would administer some of the vaccinations to the dogs to make sure that they didn't weren't susceptible to some of the things that are around bovine. Is that something that this owner exemption would also prevent a farmer or rancher from doing to their own domestic animals that are not for food?

I guess I think that's an excellent point and something that the board can discuss about the non food animals that they might own on their ranch. I don't think that was specifically brought up in a board meeting, but I think it's something for them to discuss.

And then along those same lines, we utilize artificial insemination for the safety of animals in breeding. Is that something that the board would also look at as some animal husbandry, as something that would not be excluded, I guess, from the owner exemption? Like we can continue doing that in farming and ranching.

So if it's, if it's their livestock or food animal, they'd be able to continue to do that? Yes.

Okay. I do have another question is, let me find it here. What there is some talk about here about compounding medication. What specific medications are you talking about when it comes to compounding?

Well, yeah, for the, for the compounding, there's several. And I know some of the more questioned medications are like ophthalmic medications that a lot of times needs to be compounded by the practitioner. We have to abide by federal and what you call this, federal laws for pharmacy.

That's why the board has been working closely with the Board of Pharmacy with regards to all of this. I know it's been a critical issue for a lot of the practitioners, large and small animals, about access to a lot of the medication that has been compounded.

But because of this loss, the board works with the board of Pharmacy to ensure that we are abiding by all these laws. And the board of pharmacy has been very receptive to our inquiries and we're working together with them.

Do you have any like specific medication, I guess that you guys are looking at the compounding of more closely besides just the ophthalmic?

I can't, as a small animal practitioner, I am not as familiar with the medications.

And the board doesn't necessarily, when they're talking about drug compounding, talk about specific drugs in their discussions. It's just the ability to compound, which is really just the mixture of any two medications. So even we had discussed about IV fluids and if you put.

I was going to mention it's a combination, I work in emergency medicine and it could be mixing IV fluids together, adding potassium chloride to a fluid bag, that is compounding, that is considered compounding. And so it could be anything like that. And that's a simple thing that we have worked on continuously.

So if I may add, one of the obstacles I guess that we have right now, a lot of times this compounding happens out of state. Right. And so because of the new like conversations about and rules about compounding, this has limited the veterinarians access to all of this compounding pharmacies out of state.

Has your Board engaged on bird flu at all or the process of. I mean that is crippling my district right now. But when we talk about the price of things, we. We can look back to bird flu. Have you guys engaged on bird flu?

Not directly, but we are working together with CDFA to make sure that we are providing the information to the veterinary professionals and making sure that if there's anything that the veterinary professionals or our licensees are able to participate in prevention and even the dissemination of information, we definitely work close together with the cdfa.

And we actually just had the CDFA at our last board meeting and they gave an update of everything of what the Avian flu looks like right now, what they've done to help address it and what they forecast it to be. And we have them come on a regular basis to report with us.

We also have a Subcommitee that works with them and we meet quarterly as well to stay apprised of all of the things that have the overlap and then asking CDFA for any additional information we can provide to our licensees and stakeholders. And a lot of it right now has been related to the Avian flu.

Thank you so much. I appreciate it. Thank you, Mr. Chair.

Thank you Assembly Member Macedo. And thank you for going down a line of questioning. I was going to ask about the owner exemptions and just want to quickly add on and just really encourage all of you to be very targeted in how you address that issue and make sure that we ensure animal patients are protected, but also empower shelters and rescues and farmers to continue the good work that they're doing.

So appreciate that. Assembly Member Bauer Kahan

Say I was not going to ask about giving vaccines myself to large animals. So I appreciate Mercedes questions going down a different line of questioning. So I noticed in the report written by Committee that you've seen a massive increase in the number of reports.

There was like a 250% increase from 20-21 to 22-23 of investigations that you have to do enforcement actions. Last year, this or the House and the Governor signed a Bill that will allow telehealth for veterinary patients, if you will. That's a Bill I'm really excited about.

I think if it's good enough for my children, it's good enough for my dog and I think it will expand. I love my dog and my children would not be offended by that statement. Let me tell you, they love her too.

So I think it's a really exciting move, but it does raise questions around your ability to enforce because I think there are, you know, although it's very exciting and I think it will provide access and increased access across the state.

You know, we want to make sure that those patients receiving telehealth are getting the same level of care that people walking into the office are. And so we want to make sure. I want to make sure your enforcement is expanding out to those services. Can you touch on that?

Sure. And I think the board shares your goal to ensure that consumers and patients have the same level of protection that they would do if they walked into a brick and mortar.

I think as far as what we're doing on the enforcement side, we did update our complaint form to be able to identify if they are receiving the services via telehealth as well, so we can start tracking that. But as far as the standard of care goes, it's the same standard.

So if they choose, if veterinarians, in their professional judgment, choose to use telehealth services, that may not be appropriate.

If we get a complaint and we look at the method that was used to deliver that care, our subject matter expert would review that and see if telehealth services was appropriate or if it should have been seen that patient in person.

And so the subject matter expert would opine on whether it was the standard of care was followed. So we would treat the investigation the same, despite what method that they deliver the services in.

And are you going to provide some guidance to your providers on what you think the best standard of care is when they should be coming in versus when telehealth is appropriate.

So the, the board itself doesn't typically provide that guidance. That typically comes from the. The professional associations of best practices. We provide information on what the laws are and what they can and cannot do.

So when AB 1399, that's the Bill you're referring to, passed, the board reached out to the veterinary community to find out what, what questions they have. The board then developed frequently asked questions.

We had a couple public meetings regarding those to make sure that we're addressing the questions that are out there in hopes that they'll feel more comfortable in providing the services that they're providing. Those were published in July, so those are posted on our website.

We do still hear, though, that there are veterinarians who are still reticent to use telehealth services. And there's still a lot of confusion out there as far as the terminology that's being used.

And so the board is looking at requesting that certain definitions, telehealth, teletriage, teleconsultation, are added into the statutes to provide clarity of what those mean and when they can use them.

Great. Well, to the extent that you can provide us with guidance on how that can best be implemented, I think it was. We were all pretty excited about. So thank you.

Thank you. Any additional questions or comments from Committee Members? Chair Ashby.

Thank you very much. I'm be really brief and ask you to be brief also with your answer here. Thank you to the colleagues for all their great questions. The board noted that in the 2025. Sunset Review report, there's been a significant increase in the number of complaints received over the last four years.

So what are the majority of those complaints about? If you can be really succinct, and. If those complaints are outside of the board's jurisdiction, what steps do you take to refer consumers to the correct agency or entity responsible?

Yes, the majority of the cases we get are jurisdictional. A lot of times the consumers, all they know is that they took their animal to a veterinarian and something went wrong. They often don't know what's being specifically happened.

And so we investigate all of those complaints, and we are finding that a lot of times the veterinarians, they might have done everything that they can do for those patients, but by the time they see them, often it is too late, because animals hide their pain.

And so by the time the consumers are recognizing that there's something wrong, they've probably been in pain for a very long time. So most of our complaints are jurisdictional and we're treating them as such.

Thank you for that.

Hi. How. What's the number of complaints that you're. Getting per year or that growth? Yes.

So it's, it's increasing significantly year after year. Last year we had 1800 complaints. This year, we're tracking over 2000 complaints received this year. So it's constantly growing year after year. And the thought is, as culture changes and more animal ownership happens, in the Committee report, it talked about how there's roughly 50% of the population owns animals.

And of those, roughly 90% of them think of their animals as part of their family, which is a culture shift, because right now a lot of the laws treat them as property. And I think that with that shift of thinking of their animals as a family Member, you're going to see higher amounts of complaints.

And also to keep in mind when you're comparing the veterinary world to the human health world, you have the medical board, but then you also have the board of optometry, you have podiatry, you have physical therapy.

All in modalities of the human species where the Veterinary Medical Board we don't have that ability to send complaints to these subsets because it's all of the Veterinary Medical Board. And so I think that it's going to constantly increase and we also increase our licensed population.

So with those two things, I think that the level of complaints will continuously increase. I'm hoping for the day where it sets to level out, but right now it hasn't in the last 10 years.

And what is that? How many customers are there? Like what's the percentage of happy customers vs the complaints?

Customers as in clients or consumers? Clients or animals? Like do you have the data on. That, on the number of happy customers? No, because we just get the complaints when they come in.

Okay, thank you for the good reminder. We need to focus more on happy customers. I love my vet, so does my dog, who needs to go see them too often. But very grateful to the vets out there. Quick question around fees.

It appears that in order to remain solvent, the board will need to increase fees between now and next sunset if granted the authority to raise fees. How do you plan to engage licensees to ensure increases are gradual and do not disproportionately affect areas of the vet profession?

And then also in the background paper, the Committee staff raised the issue of the tight Reserve forecast that current statute limits your funds at, which is different from a lot of other boards. Have you found the 10 month Reserve maximum hard to deal with?

And would aligning your Reserve requirements with other DCA entities help you better manage funds?

Yeah. So for the the first question as far as fees and engaging the stakeholders, just like we what the last round we do plan on right now we have a Subcommitee looking at the fees closely to see what the appropriate fees are that we do need.

Not immediately, but it will be in the near future to raise the cap too. But they're going to come up with their recommendations.

We'll have stakeholder meetings to engage them, to let them know what we were thinking, get their input on it and then provide that also during the public meetings as well to have them part of those discussions.

It's very important that they understand where the methodology is coming from and that we are doing our best to be fiscally conservative and responsible as possible. Our mandate is consumer protection, but we owe it to our licensees to do it in the most efficient way possible. So that will be will be active engagement with the stakeholders.

As far as that 10 months in Reserve, that is challenging. When you go up to. There's times where if you go 10.3 months, you start getting individuals who are calling in wanting to have our fees decreased.

But as most of you know, that is the 10 month is very unique to this board where you have a General business professionals code 128.5 that puts includes this board specifically calls it out and all the other boards in DCA that says that they can have up to 24 months in Reserve.

So you right now you have the conflict in the laws itself. So yeah, it becomes challenging when that because that 10 months is pretty Low and when you have large enforcement cases that can really tank your Reserve. So it's challenging.

Well, thank you very much. Thank you for the presentation, the conversation. I guess before we let you go, anybody from the public who wants to come in and make some comments, come on up. There are a lot of you. You have two minutes each. You do not need to use all two minutes. If you agree with comments that anyone else made, just be like me too. Thank you.

Good morning, Mr. Chair and good morning, Madam Chair and Members. I'm Christina DiCaro representing the California Veterinary Medical Association. The CVMA supports the continuation of the Veterinary Medical Board and we thank your Committee and Mr. Franco for the great work on the background paper. We also support the board's recommendation to include another RVT on the board.

We think they are a valuable part of our profession and that would be a fabulous idea. The CVMA also recommends that one of the veterinarian Members on the board be designated as somebody who is in the large animal or equine practitioner space.

Because we seem to be having a lot of those issues of late at the board level. In our letter to the Committee, the CVMA has requested that language be included in this year's sunset Bill to create a tighter definition regarding who can serve as a subject matter expert.

We want to make sure that the most capable and appropriate people are reviewing those cases since they are so important. And finally, we'd just like to say that we agree with Dr. Salacito that the only safe way for human practitioners, chiropractors, physical therapists, et cetera, is to work on animals under direct supervision of a California licensed veterinarian we really appreciate that robust discussion today on that issue. Thank you very much.

Thank you.

Good morning, Mr. Chair and Members. Karen Lange, on behalf of the California Animal Welfare Association, the represent representing the public and private animal shelters throughout the State of California. Our main concern is with the discussion around the owner exemption.

Four years ago, when you did the last sunset Bill, you added in some language into that section of code that was incredibly meaningful for shelters that could do some of the preventative care like giving flea and tick medication without violating the scope of practice. We really don't want to go backwards on that.

We're incredibly grateful for you for including it in the first place. We're also worried about the impacts on folks that have a little bit more challenge accessing veterinarian care for providing some of the medications that are allowed to be given under the owner exemption.

We don't want to punish folks that live far away or can't afford to get their dog into the vet every time they need some type of medication like that that we can administer now at home. So we just want to make sure that whatever is happening in this space is done very narrowly to protect the owner exemption.

And we might suggest possibly having some kind of gathering that includes the district attorneys as well as the Vet Med board and the animal shelters to discuss why cases aren't being prosecuted for felony cruelty. Now, based on some of the stories we heard, they are horrifying. And I don't my, my client would never defend those behaviors.

So we want to protect the owner exemption for those that are doing the right thing by their animals and by the animals that come into the shelter, since we don't own them at the shelter.

But we do want to have that conversation to try to advance protecting animals and not letting that section of the law be used in a way that lets people get away with something awful. So thank you so much. Appreciate your staff's work on the background paper. Thank. Thank you.

Thank you.

Good morning, Committee Members. Grant Miller, regulatory Director of the California Veterinary Medical Association, just piggybacking on Ms. DiCaro's comments. We'd like to thank this Committee, particularly the consultants, for elevating the the issue of drug compounding that we're starting to. See more prevalently in the veterinary profession.

Assemblymember Macedo made some insightful comments about wanting to know what drugs were having some problems obtaining. We just really appreciate that being elevated. Although we feel that that's more seated in the board of pharmacy. We will be making comments in their sunset hearing next week. I also have a list of all.

Those drugs that we can't seem to obtain. I do appreciate it being elevated at this level. We found that the Veterinary Medical Board has been very responsive, highly concerned about. Whatever issues we're facing. It does appear to be more primarily an issue that's at the Board of Pharmacy. So, you know, that's where we're really.

Trying to take that up. But we do really appreciate the insightful comments. It helps to know that you all are aware of that at the Veterinary Medical Board level. Thank you. Thank you

Sarah Brennan with the Wideman Group, on. Behalf of Cal Chiro, respectfully asking VMB to consider ABCA/IVCA certified animal chiropractors. As allies and working with us in a collaborative fashion to establish a pathway. Allowing direct access in a manner that ensures animals receive high quality care while maintaining professional standards and safeguarding animal protections. Thank you.

Thank you very much.

Hi, Mr. Chair and Members of the Committee, Bob Rilling Smith with the American Kennel Club. Just to echo some of the previous comments, we have concerns around eliminating the owner exemption, especially for some of our rural and urban folks, and just want everyone to consider how that could impact them. Thank you.

Honorable committee members, I am Karen Atlas, the President of the Animal Physical Therapy Coalition and California Licensed Physical therapist for over 25 years with extensive experience in both human and canine rehabilitation.

Our coalition, comprising various stakeholders such as DVMs, PTs, RVTs, search and rescue and law enforcement canine handlers, animal welfare agencies, and the animal owning public, is committed to addressing the lack of access to animal rehab care. Additionally, we also wish to highlight our concerns regarding the transparency, accountability and fair minded of the veterinary medical board.

Despite ongoing efforts since 2016, the issue of animal physical rehabilitation remains unresolved within the VMB's sunset review process. The VMB's recent regulations in 2022 ostensibly aimed at addressing the matter have, instead, restricted access to care by placing unnecessary supervision requirements on licensed physical therapists, hindering their ability to provide essential services efficiently.

Specifically, they changed a model that allowed for direct or indirect supervision to a direct supervision model only despite this area of care being determined a safe practice by the VMB's own stakeholders task force. Our coalition advocates for Assembly Bill 1458 in the current legislative session to tackle these access challenges and foster a more reasonable regulatory framework.

We look forward to working with each of you toward a more sensible solution for this critical issue. Additionally, we are troubled by the VMB's disregard for stakeholder input and apparent bias in decision making processes, jeopardizing consumer interests and animal welfare.

The board's actions seem to prioritize specific interests over broader needs, raising doubts about their impartiality and commitment to consumer protection. We urge for fair and transparent proceedings that consider diverse viewpoints and ensure equal representation of stakeholders in decisions affecting animals and California consumers.

Thank you very much.

Your attention is appreciated. Thank you.

Appreciate it. Thanks so much.

Good morning, committee members. My name is Dr. Jenny Moe. I'm a physical therapist licensed in both California and Nevada. I've been a PT for 22 years and certified to work with animals for 15.

I'm the Vice President of the Animal PT Special Interest Group within the American Physical Therapy Association and I'm also the owner of a custom animal wheelchair company called Dog on Wheels. I'm passionate about working with animals and expanding access to physical rehabilitation services.

I moved to Nevada to be able to have my own practice in the South Lake Tahoe area after working for several years in a specialty practice in the Bay Area.

I received my license from the Nevada Veterinary Board as an animal physical therapist and was able to easily work together with the local veterinarians to provide rehab services to their patients. The model of obtaining a referral and ongoing communication with the veterinary team was easy and familiar, much like the way physical therapists work in the human world.

After years of working side by side with multiple specialists and veterinary clinics, I was able to share my expertise in close collaboration with the teams in Nevada as well. Access to rehab services was easy for clients living in Nevada, and I had no trouble working together with referring clinics to communicate or share records.

As I returned to the Bay Area, I've been limited in my ability to make a living as an animal physical therapist. I would like to be able to provide rehab services to the animals in my community, especially in the home setting. I am not able to practice my craft under the current restrictions.

Access to rehab services continues to be severely limited even for affluent areas such as around San Francisco and Silicon Valley. Even animals who are paralyzed and not able to get the services they need to recover, leading to a shortened lifespan for some.

I frequently hear from owners and veterinary professionals alike how frustrated they are that there is such long wait lists for rehab services. Delayed or limited access to physical rehab can lead to prolonged difficulties for not only the pets and their families but also added expenses.

Veterinarians who want their patients to get better are not able to find available providers, and clients are searching high and low on their own to find help. From my experience, veterinarians want to collaborate with appropriately certified physical therapists such as myself and find great value in having us as part of the medical team.

Thank you very much.

Thank you for your time.

Thanks.

Thank you chairs and thank you members for allowing me to speak today. My name is Judy Breton. I'm a certified master groomer and a certified kennel operator. And the exemption act that they're looking at rewording, I would really appreciate it that you take into consideration how we take care of our pets.

And when we deliver a litter, we need to be able to take care of that litter and administer the vaccines that are going to make the animals healthy in a timely manner. Thank you.

Thank you very much.

Honorable Chairs and members and members of the board here or representatives of the board: thank you so much for the opportunity to speak today and for the sunset review. Thank you. Thank you staff for the thoughtful analysis and background paper. Those are not easy to write, and they don't write themselves.

I know, but I am GV Ayers I represent the Animal Physical Therapy Coalition. I'd like to identify myself with Karen Atlas, what she had said before and then also Dr. Jenny Moe, what she had just said there as well, their testimony as well.

And we're looking forward to working with you this year on issues related to 1458 and with the board as well here. And so, we look forward to that. We do believe that indirect supervision is a safe process in the area of animal physical therapy.

There are other states that do it and have done it very commonly and there have been no reported incidents of animal harm in any of those. So, thank you so much for your time.

Have a good day. Thank you very much. Appreciate that. Thank you again to all the representatives and members of the board for being here today. And next we're going to move on to the Board of Optometry. Thank you. The final item on our agenda today is the Board of Optometry.

Board President Jeffrey Garcia and Executive Officer Gregory Pruden are here to address the committee. Come on up. And once you're settled, we're going to go a little bit out of our normal order of things. And I want to go to Senator Weber Pierson just for an opportunity to make some comments before she has to.

She's being called over by the senate to do some important things over there. So, Senator Weber Pierson.

Thank you to both of the Chairs the B&P, both on the senate and the assembly side, for letting me jump in.

I did have something I needed to be at 11, so not going to be able to stay for the presentation but wanted to be able to address some of my concerns and hopefully we can continue to have conversations with the members, but also with me.

The first thing is I was recently made aware that the board is looking at regulations to allow for optometrists to use radio frequency technology to treat dry eyes. A little concerned about that given the passage of AB 407 from past Assemblymember Salas that prevents the use of surgery.

And when you look at the definition of surgery, it specifically talks about any act of human tissue which is cut, altered or otherwise infiltrated by any means. And with radio frequency technology, it does alter tissues by generating heat within the tissues which leads to contraction of the collagen fibers, essentially tightening and reshaping the tissue.

And so, the fact that the board is considering this is very concerning to me because it does appear to go against what we, the legislature, have passed. And so, I wanted to put that on record and hopefully we can continue to have more conversations about that.

Additionally, in your report, your sunset report, which is very long, very thorough. I think it was about 300 pages. There is another area under Section 10, under new issues, which you talk about authorizing contemporary optometric practice in California.

You know, recognizing that we do have a shortage of ophthalmologists, and we need to be able to provide these kinds of services for all Californians. However, I think one of the issues that we have dealt with in the past is the amount of training and whether or not there is they're comparable optometrist versus the ophthalmologist.

And so, I just wanted to voice here as we start this process, that as we're going, potentially going down the road of expanding the scope of practice for optometrists, the training requirements need to be the same as we do for our MD ophthalmologist or do ophthalmologists.

And so when you're talking about using lasers or performing minor surgical procedures, especially since even in your report, you talk about the fact that the vast majority of patients that you see are Medi-Cal patients and about 40% of our children are also the patients that have Medi-Cal. There needs to be equitable training.

We do not need to place individuals with less training in these areas. And so, I just wanted. I've mentioned it before. We've talked about it before with some other bills that have come up that have tried to expand the scope of practice. But I wanted to make sure that I got that on record now. As you all are looking at this, as we're talking about the sunset review and potentially expanding the scope of practice, we need to ensure that whatever is put out there is the same requirement that we require for our MDs and DOs. And then, you know, again, the radio frequency.

I think that is a conflict with what the legislature has already stated. But I want to thank the chairs for allowing me to speak before I have to step out. And I look forward to the continuing conversation with you all on these issues.

Thank you, Senator Dr. Weber, Pierson. The floor is yours and maybe just hit the mic button.

Good morning, Chair Ashby, Chair Berman, and committee members. My name is Dr. Jeffrey Garcia, and it's my privilege to represent the California State Board of Optometry alongside our Executive Officer, Gregory Pruden. I'm currently serving my second term on the board, having been appointed by Governor Newsom in 2020.

I am a private practicing optometrist in the beautiful Central Valley, servicing patients between Fresno, Kern, Tulare counties. Our board's mission is to protect the health and safety of California consumers through licensing, registration, education, and the regulation of optometry and opticianry. I'm very proud of the accomplishments that our team has achieved since the last sunset in 2021.

We have a very dedicated and hard working staff, EO and board now. Looking back over the past four years compared to where we are now, I'd like to share two of our notable successes with you today. Number one, processing times for every application type have improved over each of the past two years.

Four years ago, our licensing turnaround time for new optometry graduates was sitting at nearly three months, which was clearly unsatisfactory. Our team identified this as an issue and set on a goal of increasing efficiencies which is resulting in licensing times now reduced to less than three days for completed applications.

So that is a significant improvement from three months to three days. This achievement not only serves our new optometric graduates that are eager to get to work to pay off their student loans, but it also adds additional doctors of optometry to California's health care system.

This is important because we currently have a significant a very significant access to eye care issue, especially in the rural areas of California and where I practice. Number two, enforcement four years ago was also a concern. Specifically, we were under reporting or underperforming CEs which can potentially impact public health and safety.

Again, our team identified this as a priority issue and made the adjustments necessary to reboot the audit program. There's still more work to be done to both increase the number of audits and increase the rate of compliance. But four years ago the board completed zero CE audits. Today we're sampling 7.5% of our renewing optometrists.

So looking forward, we're committed to maintaining a high level of service professionalism and efficiencies that we have achieved over the last four years. And we're also determined to increase access to optometric care in our state by rolling out two of our most recent adopted regulations.

The first one being the Mobile Optometric Office program which will allow optometrists to reach out to our underserved populations and communities through nonprofit and charitable organizations. Number two, the Home Residence Program which will increase access to optometric care. Are homebound and our underserved populations by bringing vision care directly to the patient.

We appreciate your support on these efforts to increase access to high quality competent eye care provided by licensed optometrists here in California. Access to optim denture care has the potential to significantly improve the health outcomes of all Californians, but it can also uniquely impact individuals in our underserved populations and communities.

Both the CDC and NIH have noted the importance of eye health and that vision impairments are a serious health concern, especially in older adults and other subpopulations. I appreciate your time. Thank you for allowing me the opportunity to represent the California State Board of Optometry today.

And Executive Pruden and myself are open for any questions you may have. Thank you.

Thank you. President Garcia, Executive Officer Pruden, do you have any comments or just here to take questions?

Happy to answer questions at the pleasure of the Committee.

Thank you. Any questions for Members of the Committee?

Senator Grayson, thank you so much, Mr. Chair and Madam Chair, and thank you for that presentation. I do want to address mobile offices for a moment, if you will. They're important. They play a great role in being able to reach underserved communities, especially in my district.

Since the inception of it in Los Angeles in 2012, a particular outfit, Vision to Learn, as you're very familiar with, served over a million students. They provided over 240,000 pairs of glasses.

As a matter of fact, through federal programs and even private contributions, they've been able to expand their clinics or could potentially expand them from 12 to 16, which is problematic under current situations. So the exam, or at least this expansion, allows them to see an additional 43.

Now, the reason why this is important is because Vision to Learn has done extensive charitable work in my district. They've conducted 6,723 eye exams. They've given away 5,755 free pairs of glasses to underserved students in my current Senate district.

So in my previous Assembly District that I represented, I just remember it was the day that Vision to Learn showed up at an elementary school and there was a fourth grade boy who had been a huge frustration to the teachers, had behavioral issues that seemed to not be correctable. Parents were frustrated. Vision to Learn shows up.

They give the student, the young child, an eye exam. They are now back. I accompany them. And when they give the pair of glasses to the four year old fourth grader, the fourth grader puts the eyeglasses on and for the first time in his life, he makes the pronouncement, I can see.

And it was life changing for that fourth grader.

So my question that was a long way around to the question, what is the logic, what is the logic of tying the number of mobile clinics to the caps that are on brick and mortar stores when Vision to Learn is not really a traditional optometry market or it's not in the traditional Optometry Market Member Grayson, thank you for the question.

Be happy to take a chance at giving you an answer here. You're right that the law does limit in the first renewal period the number of offices that a mobile optometric office is allowed to have. That number is 12. Following the first renewal period, there is no such cap.

Frankly not really aware of what consumer protection benefit might be derived from limiting the number of offices that might be eligible to be received or applied for by any one entity.

I think, as has been identified in the background paper by the Committee staff, this is an area that we should look at and we're happy to work with the Committee during the sunset review process as to whether that cap should be removed, adjusted upward or otherwise changed.

Thank you. Any additional questions, Senator?

Thank you, Mr. Chair. And 11 brief question. I authored a Bill 1067, which we didn't get the signature from the Governor, but it would expedite licensure for those health care professionals, particularly in disadvantaged communities. I'm curious what the board is doing to address this gap of, of service in underserved communities.

And, you know, how can we ensure a timely licensing process so that we are able to put more boots in the health provision ground battleground?

Appreciate the question, Senator. We think that the two most recently implemented regulations are going to hopefully go a long way to increasing access, especially to vulnerable populations across the state. And that's talking about the mobile optometric office program and then the home residence program.

The mobile optometric office program was passed by this Legislature several years ago, and it took, frankly too long for our board to implement that regulation. And we're certainly apologetic in the delay in the length of time there. Effective January of this year, the mobile optometric office program has been effective and the applications are available online.

So we're certainly hopeful that we will begin to see more and more applications come in for that program so that we can issue permits to these, to these mobile units and they can be going out into the community and providing the care. I will say sort of beautifully about the design of that law.

There's a lot of allowable mobile activities that can happen without a license right now. And so there is a lot of mobile care that is being conducted in the state at the moment. The home residence program is, I think, another very important program that we need to get fully implemented. The regulations are implemented.

The applications will be released on our application licensing system soon. By being able to bring optometric care directly to folks in their home who may have physical ailments that make it Difficult to leave the home or access transportation issues. So we're very excited about how that can improve optometric care.

Interestingly enough, with the home residence program, you also, as a licensed optometrist, can provide care within the home. Now without a permit. It's only if you hit a certain trigger in the law that you actually do need a permit.

So we certainly encourage all licensed optometrists now to take advantage of those, those provisions in the law that allow care to be provided in the home. We think, and we're very proud of the good work that our team did to reduce the licensing time.

When it takes 90 days, three months to get licensed, care is being delayed and care is being delayed by those students and new licensees who have the freshest training and can provide high quality, competent care into the community.

And so by bringing that down to less than a week, we're very proud of how that has been impactful for licensees to get out into the community. That's a lot of stuff. Just on our optometry side, we have another side of our program, which is the opticianry side.

And we've been trying to partner with community organizations and community colleges to try to help increase opportunities for students to obtain the certifications and then the registrations that they need to perform optician services in California.

So we've been doing a lot of dialogue and outreach with, with different groups both on the optometry side and the opticianry side to try to increase access to care.

I appreciate that. I think the mobile and the home based care are important, but if you don't put enough certified licensed medical professionals in that pipeline, you're not going to see the impact.

So I guess my question and my Bill was focused on making sure that we had sufficient numbers of folks coming into the process and then expediting licensing so that they can apply for the permit and provide that service or provide the in home care.

And I understand not everyone needs to be licensed to provide a certain level of care, but I'm talking about folks who do need the care of a licensed optometrist. So I, if you could say a little bit about the, the pipeline, and I hate to use that term because it's such a negative and derogatory.

The way we talk about prison pipelines and oil pipelines, I'll say pathway, if you could talk about the pathway and how are we bringing more folks in and what are the ways in which we are expediting their licensing so that they can actually fully staff up those, those new Vehicles, so to speak.

Well, I think it, it is true that we are seeing, we're not seeing a lot of growth in our optometry licensure in the State of California. We've identified in our sunset report a 10 year downward trend line in the optometry growth.

And so we do have a concern about ensuring, not to use that word, pipeline, but ensuring that the we want to see that reversed is the point. We want to see growth continue. It's interesting to not see growth in the optometry licensure in this state when nationally the profession is projected to grow.

And so I think there's probably a lot of factors and reasons for that. We are concerned about the decline in those numbers. I think there are some interesting conversations happening around workforce access, opportunities for opticians to additionally obtain education to become optometrists in the future. And we are seeing some growth at the community college level.

Sacramento City College here in town has a program. There's another community college down in the southern part of the state that's looking at a program as well. These are certification programs. Some of these programs do have hopes, I think, to eventually become degree granting programs.

And we think that those are encouraging ways to ensure that the workforce maintains its vitality and that growth. We think we do have a role to play in terms of trying to get out into the community and trying to get out and to conduct that outreach.

So again, we've been trying to partner with different institutions and organizations to try to figure out where can we deliver that message, where is the best place to deliver that.

So we're looking forward to more of those opportunities, looking forward to working with you on that and also hearing some of the progress of the outreach and what it sounds like, some industry clustering in terms of education and pathway development and hearing, you know, over time what that's producing in terms of our shortage. So appreciate that.

I do have something to add to in terms of people, organizations within our industry that have successes in addressing exactly what you're saying. So vision service plan housing program as a loan repayment program where they'll pay off $50,000 in loan debt per year up to four years, $200,000 if the new graduate goes into an underserved community.

And that's on its second year. And I know it's working because we are seeing those new graduates come into the Central Valley. So that's targeting exactly the concern that you have. So there are things happening.

Thank you for that.

Thank you. Senator Smallwood-Cuevas. Senator Valladares.

Thank you So I am a long time special needs advocate and early intervention advocate for a variety of reasons, but also mostly because of my own family's personal experience. I have a niece who was diagnosed as severely developmentally delayed, nonverbal, and on the autism spectrum when she was 2.

Thanks to my mother's really seeing some of the signs there. She had not one word in her vocabulary when she was diagnosed at almost two and a half. And over the course of that year, through those early intervention services, she became a little chatterbox. I joke that she is, you know, still a chatterbox. She's 19 years old.

She's now at Northwestern. She's doing phenomenal. But that year later, when she learned to vocalize, once she learned to speak and express herself, we found out that she needed glasses.

And I remember, you know, being with my mom and sharing her, sharing the story of when my niece first put on her glasses and that first ride home and she was like, nana, I can see the roofs. Nana, I can see all the colors.

It was just kind of heartbreaking because this little girl who was about three and a half at the time, the world was just opening, literally opening up before her eyes. And because of that experience with my niece, I've.

I truly understand the need for early intervention services and whether it's in the autism community, whether it's our special needs community or kids needing glasses. Right. The earlier that we can diagnose a child, the better quality of life they are going to have.

So I happen to also live and represent a district that has a major population in the high desert. And the high desert is also a health care desert. And I want to revisit this cap that we have on mobile optometry offices.

One of the leading nonprofits doing that work in my district has seen over a thousand kids in my district. They've issued or handed out over 850 pairs of glasses. And I think of my niece, right.

And the experience that those students and those kids probably had because a mobile optometrist was able to visit their school and get them the resources they need to change their life. So I'm kind of a little confused as to one, why there would be a cap.

And two, it's also my understanding that the Board of Optometry was supposed to adopt regulations under AB 896. So why hasn't that been done? Is there any plans to do it? Because having more access to this in my district is really important.

I'll start and then I'll pass it over to President Garcia. Appreciate the Question. And I'm so glad to hear that, that your family Member, she's doing well and is able to see the regulations for the Mobile Optometric Office program have been implemented. It did take a long time. The original bill was passed. It was AB896.

There was a subsequent bill that extended out the regulatory due date by one year. Just being forthright and honest, we did not meet either of those due dates, but we have implemented the regulations now. The regulation took effect in January of this year.

And so right now, today, if you are a mobile optometric office provider, we certainly invite you to go to our Breeze online licensing system and submit those applications. I'll say something quickly about the cap, and then I'll pass it over to my. To my board President.

As I stated earlier, I'm unaware of what the consumer protection benefit would be derived from instituting a cap of 12. I can't even, frankly, tell you exactly where that number came from. So I think it is something that we should look at. We should explore that.

We should work together, both Committee and board, as well as stakeholders, to see if that should be adjusted. Should there be a cap at all, I think is an entirely fair question. We want to see the intent of the Mobile Optometric Office program carried out, and that intent was to increase access to care.

And I have a hard time seeing how you do that when there is a cap.

Well, I am glad that we are on the same page about this. As I mentioned, it is about access in health care, especially in my district that has a healthcare desert when it could change the life of a child and the trajectory of their life.

And so looking forward to working with you guys to make sure that we can address this issue. Thank you.

All right. Our Chairman is on his way back, but I'm pretty sure he's just going to ask me to ask my questions. Okay, great. Then that's what we'll do. Welcome. Thanks for being here. Nice to see you, Mr. Pruden, especially always good to see you. I want to make one statement.

Although Senator Grayson did an excellent job of talking about the mobile offices. And then you heard about it here from our new Senator as well. Validaris. She did a great job as well. Obviously, they're really important, and this is not so much a question as it is a statement.

But so long as I am the chairperson of this Committee, I will insist that there is an ongoing component of care. Because what we don't want to do is show up once in the life of a child, then leave them forever and not be around to fix that prescription a year later when it needs to be updated.

And we have created reliance on a system that's not going to be there for them. So must be a referral program involved. Must be continuity and ongoing care. I know you feel the same, Senator, but that is, that is the, the hard part about measuring this out.

And I it's less about caps and more about just care for patients and making sure that especially in areas where there's a desert of care, that we, through that licensing process, ensure that folks will show back up for those young people and that they can be reliant upon those mobile services the same way that they could be a brick and mortar business that stays in the community.

So that's just my, my, my Chair woman hat from the Senate side. I feel it's necessary to speak that piece. The board's been dealing with a structural deficit for a few years. If you've been sitting here for the last two hours, you know you're not alone in that regard.

But still, particularly since this board has not had a statutory fee increase and some of the others have, I don't think you've had an increase in over a decade. You have one of the lowest licensing fees, ironically. We've heard, we've heard from the highest and the lowest today. That was, that was great of us. Good work.

We did, we ran the, we ran the whole scale there. Good on it. It was super intentional, as you can tell. I just figured that out. Great.

I'd love to hear from you on what the impact of keeping those licenses and we appreciate that you're trying to do that for your licensees, of course, but what is the impact? What's your plan?

What do you want to do moving forward from here to address your, your structural deficit and make sure that we're providing the proper oversight and how you guys want to handle that moving forward. And if you want to comment on the mobile versus brick and mortar, I know you have feelings as well.

I'm happy to hear about it.

Just one, maybe one comment. Chair Ashby, about the comments you had for Mobile Optometric Office. I think as the background paper that staff put together indicates, there may be some opportunity to work together on some of the reporting requirements and those elements, and we certainly have some ideas on that too.

So we'll look forward to working together on that very good Fund condition. And fiscal wise, you absolutely are correct. We have been operating for a structural deficit for the last couple years. As of right now, we are projecting to have a slight surplus for this Fiscal year. So slight. Ever so slight.

But hopefully we can achieve that and stop the structural deficit problem. You're also correct that the Board of Optometry on the optometry side has not had a fee increase statutorily Since I believe 2009. The Optician Program last had a statutory fee increase and I think it was 2016.

So it has been a little while since the statute has increased caps. July 1st of last year, in 2024, the board enacted a regulatory proposal that raised all fees up to up to those caps. And so that is where we presently are today. It's still a little early to see how those new fees are coming in.

We're a little bit more than six months down the road from that regulation. So we still would like to see a little bit more time unfold before we form too strong of an opinion about the impact of the recent fee increase.

That all being said, we have no plans to seek a statutory fee increase at this moment that would be implementable and effective on licensees.

There may be opportunity to work together to allow for an increased cap in statute that would allow for the board later on down the road to pursue regulation prior to the next sunset review, prior to the next.

But at this point, we don't foresee the need for new fees being effective on licensees now or even during the next the next four years. I know that the Fund condition as presented in the background paper does show us going negative. But it does so with the assumption that the board will fully expend its appropriation.

This board does not fully expend its appropriation. It usually reverts anywhere from a quarter to a third of its expenditure authority. That's not real savings. That just means we didn't spend what we could have spent.

What we tried to present at our most recent board meeting just a couple weeks ago was a mock Fund condition utilizing more what we believe are more realistic scenarios in terms of our expenditures over the next several years.

And when you do that exercise, you see that the fun condition is in a much healthier spot and will not go negative over the next four years.

All right, well, hope that your mock up is accurate so you can get yourself out of that structural deficiency. One last question from me. Sure. And this one I'm sure you all know much more about than me. But I just wearing my California hat here.

Have there been any renewed conversations about the licensing exam and the location at which it needs to be taken? In other words, sending a lot of people to North Carolina. Any ideas on how we can not do that.

I know this was an issue that this Committee and board discussed at the, at the last sunset and coming out of the last sunset, it is important to note that at least the California students that we thought may have been impacted with COVID and having to travel to North Carolina or not being able to travel to North Carolina, we didn't actually see those impacts come to fruition.

The Legislature, I think, via this Committee, did pass SB509, which was a temporary licensure bill to try to account for some of those impacts. As far as I'm aware, not a single individual actually took advantage of that temporary licensure provision.

So I'm not sure how much the impacts of having to travel to North Carolina came to fruition, as we may have suspected they would at that time.

Let me state it a different way. We are economic development champions and would like that office to be on the West Coast, California, in the Golden State, so help us achieve that goal. Okay, new answer.

Senator, we will bring the National Association to a future board meeting and we will ask them that question.

Please invite us.

Ask them their plans for a West Coast center.

Especially if they bring barbecue from North Carolina. So. Yes, thank you, Chair Ashby, which is one question I want to. Yeah, I appreciate the questions and comments that were asked about the mobile optometric offices. I won't, I won't belabor that point. But another question.

I appreciate that very much.

It was concerning to hear that since your prior sense of review, it has continued to be a challenge to get certain optical retailers to comply with the law. And at this point, what can the Legislature do to make it clear that these companies need to either obey California law or close down?

How much time do we have?

You've got eight minutes.

Eight minutes. Okay. Well, I think we can, we can do this in eight minutes. You're absolutely right, Chair. And I appreciate, appreciate the question coming up. We have seen retail optical companies, at least a few, remain unlicensed.

And as a board, we believe that retail optical should be licensed. In most scenarios, retail optical is licensed. If you are a optometrist who also dispenses, you are licensed. If you're a medical doctor who dispenses, you're also licensed.

If you're a registered dispensing ophthalmic business, which are the entities that fulfill the prescription issued by a licensed doctor or an optometrist, you are licensed to do that. You are registered to do that.

There are a few entities who appear to use creative corporate structuring to try to evade what we believe is the spirit of the laws passed by this body which is to require a registration when an optometric product is being dispensed to a patient. So we look forward to working with the committees on this topic.

I think there are some unique issues both in the online space and then the retail space and how these 22 technologies or two ways of delivering services sort of meet in the middle.

We have presented to the Legislature and our sunset background paper a proposed scheme to try to try to close down any loopholes that may exist in this area to again make it make it clear that we that we believe that consumers are protected when the retail location that they go to to purchase their prescription product also has a license.

That was two minutes, got six left. I don't think we have any additional questions because we have no additional Members or Senators. So with that we'll go to the public. Any comments that folks want to make up to two minutes each, please.

Good morning Chair Berman and Chair Ashby. My name is Dr. David Redmond. I'm practicing optometry, optometrist and I'm also the Advocacy Chair for the California Optometric Association. COA represents thousands of optometrists statewide in every demographic dedicating to ensuring California's have access to affordable, high quality eye care.

I'm no stranger to the sunset process and I believe that the opportunity to review and enhance the efficacy of a profession is a remarkably healthy process. CUA supports the State Boards of Optometry recommendation to modernize optometry and our Scope of Practice Act. The world is changing rapidly.

As you know, the fax machine was once revolutionary and now it's an antique. Our laws must be keep must keep pace with the advancements in technology and training so that California patients receive the best care from highly trained educated providers that they already trust.

It is tragic that the optometric students educated in California have to leave our state to provide full care. Simply put, as discussed in other hearings here, California optometrists are not authorized to practice full extent of their education and training in other states.

The record is clear that optometrists have safely performed in office procedures like laser treatments for glaucoma for decades. Meanwhile, California patients are forced to schedule separate appointments with more expensive providers for the same care. This is not a matter of just convenience. It's an urgent workforce issue.

A recent ophthalmology journal studies projects a 12% decline in ophthalmologists by 2035, while the demand is expected to increase by 24% during Colorado's 2021 sunset review. Lawmakers carefully examined the scope of practice for optometrists and recognized the need to modernize outdated restrictions.

Consequently, they safely and responsibly expanded optometric authority to include laser procedures and lesion removals, ensuring that patients have responsible access to comprehensive health care.

We support the board's recommendation to increase authority over the unlicensed corporate entities that have exploited loopholes to avoid oversight and rogue optical companies deliberately thumbing their noses at the law to evade consumer protection and should be called on the carpet. Equally important is strengthening corporate law practice to ensure optometrists can make medical decisions.

And we are here to answer any questions. And I want to just point out Executive Officer Pruden for his enhancing the turnaround and all these optometric issues. So thank you for that.

Thank you very much.

Good morning Chair Ashby and Chair Berman. Thank you so much. My name is Damien Carroll.

I'm the National Director of Vision to Learn and very pleased that so many of the centers have already made reference to our program in the state which has been helping students since 2012 and students in many of the districts of the Members here on the Committee. I won't belabor the comments, the size of that work.

Just here to say that with the help of the Legislature and help of the board, Vision to Learn is really poised to help many additional students in new areas of the state in the years to come.

Recent legislation around a health service initiative and Medi Cal has been able to make it possible for our area to visit areas like the Central Valley, Yolo County, Eastern Sierras and set up permanent programs in these areas where there has not been the philanthropic support to be able to sustain programs.

There are so many kids in need in these areas. Children Now recently put out a report that showed that over a two year period only one out of five children in California received an eye exam. That's all children.

And of course the percentage for kids who are covered by Medi Cal is in the schools that we visit is much lower. So our program is ready to serve more schools.

We have the funding, we have the staff, we have the mobile clinics and we are getting reaches out from schools and school districts all the time asking for more services. And really all that is standing in the way is the existing cap on mobile clinics.

As Director Prudhu mentioned, the cap originally was set to be established in 2012 with a two year period after which it would expire. Sorry, 2022 and due to delays. We don't begrudge the delays, but had that timing played out as it was originally in the legislation Vision Solar would not be under a cap today.

So we are seeking to have this cap eliminated in keeping with the Legislature's original intent and with the enormous need in the state. I'd also. Senator Ashby. Chair Ashby, your remarks on referrals are very well taken.

Our program has been working for years to be a connector between the initial service provided by Vision to Learn for students who are going entirely without Vision Care, to be able to make connections, inform long term relationships with their local optometrist so that they can have that annual service.

And if you could wrap up Damien, that'd be great. Yes, thank you.

Sure thing. So in addition to making referrals, we are starting networks with entities like Children's Hospital Los Angeles to be able to make this possible. And we are very much in keeping with that concern. We want to make sure that we're leading kids to permanent optometric care. So I thank you all for your consideration.