Senate Business, Professions and Economic Development Committee
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Senate Business, Professions and Economic Development Committee California State Senate
Follow its sittingsSpeaker 2
Nilo here. Smolik Cuevas? Strickland? Umberg? Weber Pearson?
Here. Weber Pearson here.
Speaker 1
Go ahead. That's Senator Umberg here as well. We'll mark him present. Senator Umberg?
Speaker 7
Thank you. Good morning, chair and members. I am here to present SB eight forty nine, a bill that addresses physician sexual misconduct. According to Business and Professions Code, Section 2,001.1, Protection of the public shall be the highest priority for the Medical Board of California in exercising its licensing, regulatory, and disciplinary functions. The physician patient relationship involves significant vulnerability and relies on ethical judgment and integrity.
Patients place extraordinary trust in their physician. Any violation of that trust, especially when it is broken through sexual abuse or harassment, should be disciplined to the greatest extent. In 2022, AB sixteen thirty six removed the medical board's discretion to reinstate a physician or surgeon who lost their license due to sexual misconduct with a patient. At that time, the L. A.
Times had reported instances where physicians committed acts of sexual misconduct against their patients. In all of the reported instances, the physician either had their license revoked or the physician surrendered their license but subsequently petitioned the Medical Board of California for license reinstatement. For that reason, the bill removed the board's ability to reinstate those individuals. More recently, articles about sexual misconduct within the medical industry brought forth this issue to the forefront once again. In those articles and discussion, we discovered that the original bill did not include explicit reference to license renewals.
AB eight forty nine clarifies that a physician or surgeon who has committed specified sexual offenses against their patient cannot petition the Board for license renewals. This ensures that every aspect of the licensure process is captured. Additionally, SB eight forty nine requires automatic revocation of a person's physician or surgeon certificate if the license was surrendered due to sexual misconduct with the patient, the license was revoked based on a finding by the medical board that the person committed a specified sexual misconduct act or offense with the patient, the person was convicted of a court or offense of sexual misconduct with the patient or the person was required to register as a sex offender based on an offense with a patient, and their license was subsequently reinstated by the board on or after 01/01/2020. The original bill eighteen thirty six went into effect in 2023. A few years before the implementation of that measure, the legislature spoke out against sexual abuse of all forms and granted victims additional rights, including extending the statute of limitation for sexual assault claims and prohibiting nondisclosure agreements and settlements related to workplace sexual harassment.
This bill extends the victims' protection implemented by AB sixteen thirty six by retroactively applying these provisions to 2020, a time frame when the state legislature became more forceful in their discipline of sexual harassment and misconduct. I thank you for your time and respectfully ask for your I vote. All right.
Speaker 1
Thank you very much. We'll start with those in support of SB eight forty nine. Come on forward.
Speaker 8
Ryan Spencer with the American College of OBGYNs, District nine. They just approved a support position in support. Thank you.
Speaker 1
Alright. Were there was there anybody else in support or that that's it. Alright. Alright. Is there anybody in the room in opposition to SB eight forty nine?
Seeing no one, we'll come back to the dais colleagues. Yes, Senator Archuleta.
Speaker 8
Thank you, doctor, for bringing this forward. All of us who rely on you and those in the medical field to be licensed and have the education that you should have to treat the the patients. But here we're talking about prohibiting petitioning and not allowing these people to come back into practice. And that closes the door finally. Is that correct?
Yes. Okay. So with that, we're finding that we're doing the right thing. I think the general public is looking to close that door. These people that are practicing that they shouldn't because of being found guilty.
And besides the patients, I think our most precious thing are the children, the patients themselves that they oversee and take care of. So I think it's a great bill, and I'm glad you brought it forward. And I will be moving the bill at the appropriate time, and I support it a 150%. You.
Speaker 1
We do have a quorum, so we'll take that as a motion. Seeing no other comments, would you like an opportunity to close, senator?
Speaker 7
Yes. Thank you, chair. I wanna thank the committee and the and the chair for allowing me to present this bill, and respectfully request, and I vote.
Speaker 1
Alright. Thank you very much. We will do a roll call on s b eight four nine now.
Speaker 2
Choi, aye. Archeleta? Aye. Archeleta, aye. Aragine?
Aye. Aragine, aye. Grayson? Aye. Grayson, aye.
Menjivar? Nilo?
Speaker 2
Nilo, aye. Smallwood Cuevas? Strickland? Aye. Umberg, aye.
Weber Pearson? Aye. Weber Pearson, aye.
Speaker 1
Alright. That's 80 for now, but we're gonna place it on call for the colleagues who are not quite here yet. Again, we're in Room 2100. We have just one author with two bills. So if you are a member of the senate business professions and economic development committee, might wanna make your way down to the hearing room.
Alright. Senator Umberg, are you ready, sir? Would you like to start with SB 96, the streaming services bill?
Speaker 4
SB 96, was inspired by a young person named Samantha Keller. Samantha was awakened while her parents, young baby, while her parents were watching I think it was a particular streaming service, because the amplification of the ads, which was multiples of what the ambient sort of volume was for the streaming service, awakened her. Anyone's got a baby, you know how important it is to keep that baby asleep. And so, the original Call Mac was passed that dealt with, in essence, TV. This deals with, for example, podcasts and the like and what it does, it simply says that you have to keep the, basically the advertisements at the ambient level of the other content and I urge an I vote.
To testify with me is me. So
Speaker 1
Alright. Is there anyone in the room in support of SB 96 who would like to be heard today? Seeing no one, is there anyone in opposition to SB nine six? If so, please come forward. Alright.
Seeing no one, we'll come back to the dais. Colleagues, any comments? Move it. Alright. So moved.
Okay. Senator Choi?
Speaker 3
Yeah. I wonder, I think I we we heard your bill prior year last year as well. I wonder if I set up my TV volume, isn't that static the same? This advertisement comes on and the volume jumps up? Is that really common?
I haven't had any experience.
Speaker 4
Well, you're unique, Senator Choi, because I've had that experience where both with the streaming services and other, for example, podcasts where I have heard dramatic amplification of advertisements.
Speaker 3
So it does happen pretty frequently? I see. So is that because of the streaming service advertising volume level set up differently rather than my physical television set up It
Speaker 7
Thank you so much, chair. Thank you Senator Enberg for this this bill. I think we all get frustrated with the constant turning up and turning down on when we're looking at these streaming services. So how do you envision this working just in California since many of these platforms work throughout, you know, the whole country?
Speaker 4
Yeah. Well, if this actually requires that the the publishers of this content actually have to modulate around the country, I won't lose sleep over that. So
Speaker 7
So the thought process or the hope would be that since they'd have to change it for California, it would just it's something that
Speaker 4
Well that may be the impact, right. It's we in California can't dictate what happens in Mississippi. Right. Would that we could, but we can't. So yes, it may become the standard practice.
Speaker 1
other comments from colleagues? Alright, Then we have closing comments already made and a motion on the table from Senator Archuleta. We'll call the roll.
Speaker 2
Choi, aye. Archuleta? Aye. Archeleta, aye. Aragine?
Aye. Aragine, aye. Grayson? Aye. Grayson, aye.
Mentjivar, Nilo?
Speaker 1
All right, 90. We'll leave that on call as well. Thank you, Senator Umburg. Let's move to file item two, which is SB three forty two.
Speaker 4
Thank you. Thank you, Madam Chair. And members, thank you Madam Chair and Ms. Mason for your work on this bill. SB three forty two, denominated as the Contractors Licensure Fairness Act, provides a balanced approach to contractor licensing by allowing partial payment recovery in instances of licensure lapse.
Contractors will be able to recover payment for work completed while licensed, even if they were unlicensed for part of the project. Important to note that contractors will still not be able to recoup pay for any unlicensed days and will continue to be unlawful to begin work on a project if you were unlicensed. In other words, if you don't have a license, start a project, then you're out of luck as is currently existing law. With me here to testify in support is Mr. Danny Curtin on behalf of the California Conference of Carpenters, and Mr.
Robert Naida is here for technical assistance.
Speaker 9
Excuse me. Thank you, madam chair, members. The key here is a proper license is required to enter into a construction contract, period. A lot of legal, protections exist in that area. SB three four two does not change any of those.
Current contractors license law requires total disgorgement of any payment of contractors that operate without a license during the time they work in a project. Three four two limits that disgorgement to the amount of time they are without the license. There's no competitive advantage for a contractor to willfully allow a license to expire during the term of a project. Without a license, a contractor legally cannot collect money owed and has to return money already received. No rational contractor does this on purpose, and I'm looking at a contractor.
Withholding payments to contractors for a substantial period of time for any reason, and it does happen for other reasons, can seriously damage or bankrupt a contractor, particularly a small contractor. All this can occur without actual harm to the consumer. It is a draconian penalty for a violation not based on damages. No damages are necessary and without consideration of intent. The perverse incentive in existing law is most likely, again, to harm small and new inexperienced contractors.
The existing penalty based on procedures, not performance, the resultant can be a large that large owners can get projects or significant parts of projects built for free if they have smart legal, support. Three four two is more proportional penalty to the violation, but still without harm to the consumer, it is a penalty that far exceeds the crime. No opposition as we see on the bill. Right now, the concerns being raised are important but relatively speculative. Support comes from contractor associations representing responsible contractors.
I wanna tell you one thing. The carpenters are not weak on enforcement. All the housing bills we talk about, we're insisting as much as possible on our right to self enforcement for our labor management programs. We are not looking to turn a blind eye. Thank you very much.
We hope you support our bill.
Speaker 6
Don't have much to add, but I know that a number of questions were raised about whether the existing law provides substantiation for for protection for the ninety days that the board can fix the problem. But that doesn't happen in reality most of the time. And it doesn't happen because somebody sends in their renewal fee at the beginning of the year. They don't learn about a problem of a administrative gap in a license often for years later when there's litigation between a contractor and an owner or a subcontractor and a contractor. And so while there is a process in place, in reality, the ninety days that is provided to fix a problem with a license doesn't come up for two or three years, and then that problem is is is expired.
This would, solve that problem. Would also allow, even if somebody was in violation for an administrative reason, for an owner not to get a windfall of effectively a free building or free work or for a contractor to collect money from an owner and not give it to the small business, the small subcontractor, because they find a technical violation with the subcontractor's license. It would allow for a punishment that fits the crime, is the easiest way of saying it. It would allow for proportionality for the period of unlicensure to not be paid for that, to be penalized for that under the existing law, but not be penalized beyond what would be reasonable. Thank you.
Speaker 1
Alright. Thank you for your comments. Are there others in support in the room? Please come forward. We're at the Me Too portion of this hearing, so just your name and position on the bill.
Speaker 5
Madam Chair members, happy New Year. I can do that. Mike Monaghan, behalf of State Building and Construction Trades, and we are in strong support. Good morning, senators. Richard Markison for the Western Electrical Contractors Association, also in support.
Speaker 9
Madam Chair, Todd Blumstein for the Southern California Contractors Association, as well as the Southern California Association of Scaffold Contractors in support. Thank you.
Speaker 1
Alright. That's everyone in support in the room. Do we have opposition in the room to SB three four two? Seeing none, we will come back to the dais. I also have comments.
If you don't mind, I'd like to lead off and then go to my colleagues. I have a few concerns with the bill. I'm prepared to support it today, as I told you. But I would like to share my concerns because this committee can be tricky since it's a tough subject matter and there's a large business and professions code. And you those of you who read the staff report on this may see that it wasn't overwhelmingly supportive, and there is a reason for that.
And the reason is that in existing law, contractors in this space, right now as it's laid out, get two months of notice when their license expires. In other words, for two months when their license has expired, the board is sending them messages saying, your license has expired. You need to do something about it. If in those two months they don't do anything, they have another ninety days. So another three months to fix their contract, which means they have five months a contractor has five months to go back and fix their license.
And in current code, as it stands now, when they do that, their license is retroactively made whole. So it means during those five months, anytime that they fix it during those five months, then those five months, they would show up as having been licensed. Now the folks in the room are telling you sometimes they don't note this until a couple years later, and they're in litigation. So the question is, how did a contractor not figure out for five months that they were unlicensed while being notified for two months from the agency. My only point here is that we don't do this for any other profession.
We do not do retroactive licensure. We do not give five months of notice. That's already in the law. That's already done. You've already agreed to that.
This committee has already voted on that. That's in this giant book, if you'd like to see it, that miss, Lamar has brought to the dais today. The piece of this bill that is new that doesn't exist aside from, the two year piece is a it's all about litigation and how and when you can sue. And one piece of this doesn't allow consumers then to sue for unlicensed work. And by the way, subcontractors, as you all know, already have the right to to go after work done.
You we all know this. California took care of this a long time ago. Subcontractors come in and a general contractor's unlicensed or, for some reason, removed from the job. The subcontractors still have a way through liens to go after being paid. So I just I'm I'm going to vote yes because it's a complicated, difficult body, and it has two more stops.
One is judiciary where they can sort out a little bit, and I'm on that committee with the chair who is also the author. Might have a little more time to sort through some of the details there, And then it will go to appropriations where we'll get another level of scrutiny. I am putting these things on the record so that they can be discussed, so that the bill itself, as it moves forward, isn't a duplicate of existing law and doesn't create, I'm sure unintentionally, a loophole that doesn't allow consumers to hold an unlicensed contractor accountable for their work. Those are my concerns. Happy to take comments, from the board.
So I saw senators Archuleta and Grayson.
Speaker 8
Thank you, madam chair, for your comments. And I am supporting this bill because I think the, the rank and file of the carpenters need to feel a sense of security as well. When they're signing on with a particular contractor, they wanna know that contractor is, above board, will apply, every standard of the law. And I think this is a good way not only to protect the contractors, the consumer, but the employees, the carpenters themselves. And I think, we can't allow for those carpenters to be out to try in any way, shape, or form, and that sense of trust and security is needed.
And we, granted, will find a way in the various committees, but the rank and file has to feel strong that we're behind them because we appreciate the work they do. We're asking for housing to be built. We're asking for so many things to be built. We need to, to be on the same page. So with that, I will move the bill, and I thank you for bringing it forward, senator.
Speaker 10
Thank you, madam chair, and thank you for your comments and expression of those concerns. I I do also share some of those concerns, and I'm sure it'll be ironed out. Having said that, with more life behind me than before me, I can I can now see better that circumstances could come where someone would find themselves with a lapsed license? Now, I haven't had my license lapsed ever since 01/28/1999. And I find it very difficult to believe that a prudent contractor would go years without knowing their license was lapsed.
However, I'm not sure if the communication with CSLB, and they're a great agency, fantastic agency to work with, but also had their challenges, I'm not sure if the communication is as often or as much as needed, especially for a lapse license as should be, in order for that contractor to find out. So what I'm saying is that there are occasions where I could see better today than maybe twenty years ago how a certain circumstance. So I do believe that this bill is not trying to create a loophole for a contractor that is trying to circumvent the law. I think what this, bill the intention of this bill is to really try to keep a contractor that is is doing quality work or doing work well ethically, has done the job and, satisfactorily, to be able to recover where recovery is possible. But to also know that the incentive is you're not getting paid for the days that you didn't have a license active.
And so there is still that incentive built in there, but there is also that protection for that contractor that has done the work and doesn't have to give away free work because of some ill circumstance that came his way. So I think possibly there's room for some more conversation, but definitely this is a very, very good bill that needs to be supported and in its best fashion, turn into statute. So thank you for your good work.
Speaker 11
Well, I think Senator Greyson said much of what I wanted to say, and that is, you know, I think this is a bill that represents both the consumer protection and also the worker protection, because at the end of the day and we know we work with a lot of red tape there are moments when things lapse, and there are moments when it might be five months, but you know what? Who knows? It could be six, and there could be some window where there is a lapse. I think this is an opportunity to say, if you're doing the right thing, you get paid. If you didn't do the right thing, you won't.
And I think it's a strong case to be made that it's important for us to protect both the workers who are working for those contractors because when the contractor doesn't get paid, it means the workers don't get paid, and we know what a snowball effect that can be on our economy. I want I did have one question, and I wanted to ask this, and this is something that we do on the labor enforcement side, which is presumption. And, you know, oftentimes, it seems like a lot of the onus, when you do maybe have a problematic contractor who, for whatever reason, doesn't have their license, the onus is on the consumer to figure that out. Where and how do is presumption a part of this where we can put some of that onus on the contractor?
Speaker 4
So the bill does not currently have any presumption of validity, invalidity, that a contractor has a license, does not have a license. The burden exists as it currently exists in law. If you, for example, if you if the allegation is you're unlicensed, then the burden shifts to you to demonstrate that you have a license.
Speaker 11
Small That's that's helpful. Well, I'm happy to move the bill when the time is right.
Speaker 1
Can I just Senator Small Equivis, can I just add one point? The staffs, would tend actually to agree more with your earlier statements. So maybe I'll pose this as a request of the judiciary chair to make sure that what you just said to her is accurate because, actually, my reading of this is that the burden shifts onto the consumer that they have to show that when the license was valid and wasn't valid in order to make the complaint that your license wasn't valid. I don't think that a consume that the contractor then would have to show that their license don't think that burden belongs to the contractor if you're the one bringing suit. So I guess I would say I think that's a judiciary question and maybe one that I would ask you to look at to make sure that what you just stated to her is correct, that you haven't just shifted the burden of proof of licensure to the consumer rather than the contractor.
Speaker 1
Well, I think it's a judiciary issue more than it's a BPED issue, but if you'd like if if senator Smalukuwaevos wants to hear your answer, that's fine. I'm more making a request of senator Umbert.
Speaker 6
I'll very brief. Thank you very much. The shift doesn't, the burden doesn't shift. Under seven zero three one of the BMP code, it's very clear that the contractor has the burden to both plead and prove that they have a licensure. So now they have to plead and prove it for the various periods of time versus all of the time, but that doesn't shift the burden.
And as far as the consumer is concerned, the consumer still has all the protection the law currently has. It just doesn't get to get a windfall for a period of unlicensure or licensure versus unlicensure. It doesn't get to get the hole when it's only unlicensure for a part of it. Yeah. So it's still the consumer is completely protected under law.
And then, as far as enforcement, the Board still has the right to enforce. If you're fully unlicensed, you know, it's a crime under 7028, and there's still mechanisms, both administratively, criminally, and civilly, to deal with somebody who's wholly unlicensed. Then the last comment I would like to make very briefly is, you know, when you speak of the two months at the beginning of a license renewal, sometimes these issues, in fact, more often than not, they come up in the middle of the license period, so you don't know about them. Then you send in your next renewal at the end of the year and you don't know about them for years. Now, should people?
Sure. Should people should check every day and know their license. That would be the ideal world. But the reality is that doesn't happen. And sometimes there's some technical reason why there's a short period of unlicensure during the middle of a license period, and they don't know to repair it within the ninety days.
Speaker 9
We have no intent to do what you're concerned about, so we really will work on this bill to make sure that doesn't happen. Right. I can tell you, I found out I my license driver's license expired when I went to rent a car. Yeah. And if I hadn't had that, it could've been years.
Speaker 1
the point is that if the cause of action for the suit is that you have to prove to bring the suit that somebody was unlicensed. You have shift the burden. But, again, I think that's a judiciary issue. I have every faith
Speaker 3
Thank you. I wanna clarify my understanding. I thought your bill was to make sure that the contractors will have their license renewed when it's due rather than ignoring and continue working and that period is five months. So, have a question whether the license notice renewal notice is given by mail or email or any other means or why would they ignore to begin with if they are serious contractors upon receipt of the renewal notice such as like a driver license, it is common sense for them to go there and renew. So is that my understanding cor correctly?
Speaker 4
ignore for five months or what and and the the other one. So what kind of notification methods are used to let them know? Presupposes that the contractor has actual knowledge that the license has expired. If if they have actual knowledge, obviously, it's prudent for them to renew the license. What this bill simply says is if if, for example, there's a period of time, it's a five year contract, they're out of licensure beyond the recovery period for thirty days, they don't get paid for the thirty days, but they don't forfeit the five years of work that they've already performed.
Speaker 4
Well, the intent of the bill is to not work an unfair situation to the contractor, and I suppose, secondarily to the employees, where you've got let's say you got a five year contract for a million dollars, right? There's a period that where you're unlicensed for thirty days. It would be unfair to simply say, you know what, the owner reaps the benefit of that thirty day lapse and so they get, as was already presented, a million dollar benefit because that thirty day lapse and this eliminates that windfall.
Speaker 4
Well, it Well, it's Let me let me go back to the question asked by the chair. So when you're suing, for example, a contractor is suing to enforce the contract. Contractor must allege that they have a license. It's part of the proof. They don't allege it and they don't prove it.
If they don't allege it, lawsuits thrown out. If they don't prove it, then there's a basically a judgment on the pleadings or a judgment after the plaintiff presents their portion of the trial. I think the question the chair is getting to is if if they have alleged that and the consumer says it's an affirmative defense, they weren't licensed.
Speaker 3
So putting us only on the consumer that I need to find out for ten months that the guy was not licensed.
Speaker 4
So the so the at that point in time, once the contractor has gone forward and provided the license and at least the contractor has the burden of proof of showing license. They've shown the license and the consumer or the other party says, oh no, you didn't have a license. You did not have a license. I don't believe that's a fake license or whatever it may be. And they allege as an affirmative defense that you weren't that you were not licensed.
The burden of proving an affirmative defense falls to the party who's alleging that affirmative defense. But this doesn't change existing law in terms of burdens of proof, or persuasion, or burden of going forward.
Speaker 1
Okay. Alright. Take that as your closing statement. You already have a motion. Will call the roll.
Yeah.
Speaker 2
Okay. The motion is due passed to judiciary committee. Senators Ashby? Aye. Ashby, aye.
Choi?
Speaker 1
Alright. That is nine to zero. And I I actually don't think we have any other members coming, so I'm gonna say that bill is out.
Speaker 1
And it is on to judiciary, and then we'll go to appropriations. I think we just have one bill, is senator Weber Pearson's, where we have one outstanding member. If you would call, file item three s b eight four nine.
Speaker 2
K. The absent members, please. The motion is due pass through appropriations. The current vote is eight to zero. Senators Minjevar, Smolwyd Quavis
Speaker 1
Alright. That bill is out as well. And, file item two s b three four two is also out at nine o. That is going to appropriations. I just need to close the roll.
Close the roll on all three bills. That's it. And for me, this is my last opportunity to chair I just need to call this. Business professions and economic development. Let's just make sure we've closed the roll entirely on file item three no.
One, s p 96.
Speaker 2
Okay. Motion is due to pass. The current vote is nine to zero. Senators Mingjivar, Strickland.
Speaker 1
We're done. That bill is out. I just wanna thank the staff of the Business Professions and Economic Development Committee for helping me over the last year and a half or however long I've been here chairing. This is an excellent committee that does incredible work for the state of California. And, on behalf of the senate, thank you for everything that you guys do.
It's been an honor to serve in this position, and, I've really enjoyed all my time working on economic development and licensure issues. Really, really important work for the state of California and a top notch staff. So thank you so much. That's it for business professions and economic development.
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