BILL ANALYSIS Ó SENATE COMMITTEE ON BUSINESS, PROFESSIONS AND ECONOMIC DEVELOPMENT Senator Jerry Hill, Chair 2015 - 2016 Regular Bill No: SB 468 Hearing Date: April 27, 2015 ----------------------------------------------------------------- |Author: |Hill | |----------+------------------------------------------------------| |Version: |April 22, 2015 | ----------------------------------------------------------------- ---------------------------------------------------------------- |Urgency: |No |Fiscal: |Yes | ---------------------------------------------------------------- ----------------------------------------------------------------- |Consultant|Janelle Miyashiro | |: | | ----------------------------------------------------------------- Subject: Bureau of Security and Investigative Services. SUMMARY: Extends the operation of the Bureau of Security and Investigative Services and the Alarm Company Act, Locksmith Act, Private Investigator Act, Private Security Services Act, Proprietary Security Services Act, and Collateral Recovery Act until January 1, 2020. Subjects the Bureau to review by the appropriate committees of the Legislature. Makes various changes to provisions in the aforementioned Acts to improve the oversight, enforcement and regulation by the Bureau of licensees under each Act. Existing law: 1)Establishes the Bureau of Security and Investigative Services (Bureau) within the Department of Consumer Affairs (DCA). (Business and Professions Code (BPC) § 6980.1) 2)Establishes the: a) Alarm Company Act (BPC § 7590) b) Locksmith Act (BPC § 6980) c) Private Investigator Act (BPC § 7512) d) Private Security Services Act (BPC § 7580) SB 468 (Hill) Page 2 of ? e) Proprietary Security Services Act (BPC § 7574) f) Collateral Recovery Act (BPC § 7500) 3)Requires armed guards applying for a Bureau issued firearms permit to submit a second set of fingerprints to the Department of Justice (DOJ) to obtain a DOJ Firearm Eligibility Determination before consideration of a firearms permit from the Bureau. (BPC § 7583.23(c)) 4)Specifies that any institution, firm, or individual seeking the Bureau's certification as a firearms training facility must complete an application that includes: a) The name and location of the entity. b) The places, days, and times the course will be offered. c) An estimate of the minimum and maximum class size. d) The location and description of the range facilities. e) The names and certificate numbers of the Bureau-certified firearms training instructors who will teach the course. (BPC § 7585.3) 5)States that applicants that wish to obtain a firearms qualifications card must complete a course of training in the carrying and usage of firearms according to the standards of the Bureau's "Firearms Training Manual", which includes: a) Moral and legal aspects of firearms usage. b) Firearms nomenclature and maintenance. c) Weapon handling and shooting fundamentals. d) Emergency procedures. e) Prequalification range training. f) Qualification course of fire: i) Range safety and procedures; SB 468 (Hill) Page 3 of ? ii) Demonstration and dry firing; iii) Practice rounds; iv) Qualification firing. (BPC §§ 7585 and 7585.6) 6)States those institutions that do not award degrees and solely provide educational programs for total charges of $2,500 or less, when no part of the total charges is paid from State or Federal student financial aid programs, are exempt from regulation by the Bureau of Private Post-Secondary Education. (California Education Code (CEC) § 94874) 7)Requires Private Patrol Operators to maintain an accurate and current record of all firearms and deadly weapons in the possession of the licensee or any employee while he or she is on duty. (BPC § 7583.2) 8)Specifies that any person registered as a security guard or patrol person shall deliver to the Director of the DCA a written report describing fully the circumstances surrounding any incident involving the discharge of any firearm in which he or she was involved while acting within the course and scope of his or her employment, within seven days of the incident and requires specified information to be provided on the form provided by the Director. (BPC § 7583.4) 9)Exempts California peace officers from Bureau firearms training courses if he or she has successfully completed a course of study in the use of firearms. (BPC § 7583.22) 10)States that a Private Investigator must possess a valid Bureau firearms qualification card on his or her person while carrying a firearm during the course of an investigation. (BPC § 7542) 11)States that every agreement, including but not limited to, lease agreements, monitoring agreements, and service agreements, as well as all labor, services, and materials to be provided for the installation of an alarm system, must be in writing. (BPC § 7599.54) SB 468 (Hill) Page 4 of ? This bill: 1) Extends the Bureau's operations and Alarm Company Act, Locksmith Act, Private Investigator Act, Private Security Services Act, Proprietary Security Services Act, and Collateral Recovery Act until January 1, 2020. 2) Subjects the Bureau to review by the appropriate committees of the Legislature. 3) Requires applicants applying for licensure as an armed security guard to submit alongside his or her application, a signed affidavit of his or her completion of a psychological examination by a licensed psychologist. 4) Requires both a security guard and his or her employer to submit a written report to the Director of the DCA of any incident involving the discharge of a firearm while on he or she is on duty. 5) Requires the Bureau to conduct inspections of all firearms training facilities in this state to ensure compliance with applicable Bureau requirements, rules, and regulations. 6) Exempts Federal Law Enforcement Officers from Bureau firearms, power to arrest, and baton training requirements if he or she has already completed a course of study for each. 7) Clarifies that private investigators who wish to carry a concealed firearm must obtain and have on their person while carrying out an investigation, both a Bureau issued firearms permit as well as a Concealed Carry Weapons (CCW) permit. 8) Requires alarm companies to make a specific disclosure to their customers regarding any evergreen clause renewals in their contracts. FISCAL EFFECT: Unknown. This bill has been keyed "fiscal" by Legislative Counsel. SB 468 (Hill) Page 5 of ? COMMENTS: 1.Purpose. This bill is sponsored by the Author . This bill is one of five "sunset bills" the Author is sponsoring this session. According to the Author, this bill is necessary to extend the sunset date of the Bureau of Security and Investigative Services in order to ensure continued oversight of alarm companies and their employees, locksmiths, private investigators, private security services, proprietary security services, and repossessors. California's security guard, alarm company, repossessor, locksmith, and private investigator licensees are better served with oversight from the Bureau, and the public is better protected by Bureau regulation and accountability toward these professions. If the Bureau is eliminated, consumer safety and the greater public would be vulnerable to more predatory companies and armed guards who would not be held accountable with specific training requirements. 2.Oversight Hearings and Sunset Review of Licensing Boards and Programs. In 2015, the Senate Business, Professions and Economic Development Committee and the Assembly Business and Professions Committee (Committees) conducted joint oversight hearings to review 12 regulatory entities: California Accountancy Board; California Architects Board and Landscape Architects Committee; California State Athletic Commission; Board of Barbering and Cosmetology; Cemetery and Funeral Bureau; Contractors State License Board; Dental Board of California; Board for Professional Engineers, Land Surveyors and Geologists; Board of Registered Nursing; Bureau of Security and Investigative Services and; Board of Vocational Nursing and Psychiatric Technicians. The Committees began their review of the aforementioned licensing agencies in March and conducted two days of hearings. This bill, and the accompanying sunset bills, are intended to implement legislative changes as recommended by staff of the Committee's and which are reflected in the Background Papers prepared by Committee staff for each agency and program reviewed by the Committees for this year. 3.Background. The private security industry in this country dates back to the 19th century with private citizens SB 468 (Hill) Page 6 of ? performing many duties that today are associated with Federal and state law enforcement. The growth in the number of individuals and breadth of activities performed (such as guarding railroad shipments, detective work to investigate crimes, tracking down and apprehending criminals, and providing security advice to banks) was integral in determining that regulation of the industry was necessary. In California, regulatory oversight of the private security industry began in 1915 with the creation of the Detective Licensing Board under the State Board of Prison Directors to license and regulate private detectives. The Detective Licensing Board was subsequently renamed the Detective Licensing Bureau, and today its statutes are known as the Private Investigator Act. In 1955, the Detective Licensing Bureau became the Bureau of Private Investigators and Adjustors that in 1970 was combined with the Collection Agency Licensing Bureau and renamed the Bureau of Collection and Investigative Services. As a result of legislation (AB 936, Chapter 1263, Statutes of 1993), the Bureau was formally renamed as its current identifier, the Bureau of Security and Investigative Services (Bureau). The Bureau currently licenses about 380,000 companies and employees serving in the areas of alarm services, locksmith services, private investigation, private security, repossession, and firearm and baton training. Based on the past three fiscal years, the Bureau issues an average of 1,900 company licenses, 71,000 employee registrations, and 12,000 Bureau firearm permits. On average, the Bureau renews 9,500 company licenses, 105,000 employee registrations, and 11,500 Bureau firearm permits each year. Specifically, the Bureau regulates the following Acts: 1. Alarm Company Act 2. Locksmith Act 3. Private Investigator Act 4. Private Security Services Act 5. Proprietary Security Services Act 6. Collateral Recovery Act 1.Review of the Bureau: Issues Identified and Recommended Changes. The following are some of the major issues SB 468 (Hill) Page 7 of ? pertaining to the Bureau along with background information concerning the particular issue. Recommendations were made by Committee staff regarding the particular issue areas which needed to be addressed. a) Issue: Establishing a Sunset Date for the Bureau. Background: Currently there is no sunset date established for the Bureau or the six Acts which the Bureau regulates. The 2015 Sunset Hearing was the Bureau's first Sunset Review. The Bureau and Department appear committed to working collaboratively with the Legislature and the Committees to find solutions moving forward in the regulation if this important industry and thus should have the opportunity to address new and existing issues raised within the Bureau as well as from the Committees. Recommendation and Proposed Statutory Change: As a result of the 2015 Sunset Hearing, this bill will establish a new sunset date, thereby extending the six professional Acts regulated by the Bureau in order to address the issues raised within the Bureau and by the Committees. b) Issue: Mental Health Evaluations for Armed Guards. Background: Currently, California does not require mental health examinations for armed guards. All applicant types, with the exception of proprietary private security employers, must submit their fingerprints to the Federal Bureau of Investigation (FBI) and Department of Justice (DOJ) for a criminal background check. Currently, the law does not provide the Bureau with the authority to require Proprietary Private Security Employers to be fingerprinted. Guards who apply for a Bureau Firearm Permit must submit a second set of fingerprints to obtain a DOJ Firearm Eligibility Determination. The DOJ Firearm Bureau then advises the Bureau whether the individual may possess or is prohibited from possessing a firearm based on the applicant's prior criminal past or history of mental instability. Mental instability includes past restraining orders, suicide attempts, and 5150 psychiatric holds. In addition, Bureau staff checks the Bureau's application SB 468 (Hill) Page 8 of ? and enforcement databases for any possible prior disciplinary actions, citations issued, or investigations related to the applicant. The application database is where Bureau enforcement staff would note an application hold. However, there is no national database for disciplinary actions for the industries under the Bureau's purview. Recommendation and Proposed Statutory Change: As a result of public safety concerns on the mental stability of individuals working as armed guards, this bill will require applicants to submit an affidavit signed by a licensed psychologist that states he or she has undergone a psychiatric evaluation alongside his or her Bureau Firearm Permit application. c) Issue: Mandatory Reporting Requirements. Background: The Bureau is not required by law to collect reports of shooting incidents involving armed guards. However, entities overseeing the actions of licensed armed guards are required to submit these reports. There is currently no legal basis for the Bureau to collect reports of firearms incidents involving armed guards. Private Patrol Operators are mandated to file an incident report with the Bureau when a firearm is discharged by a licensee, its qualified manager (QM), or one of its registrants, or when an act of violence occurs involving a licensee/QM/ registrant that requires law enforcement to respond. Repossessor Agencies are mandated to file an incident report with the Bureau when an act of violence occurs involving a licensee, its QM, or one of its registrants that requires law enforcement to respond. The Private Security Act requires security guards and their licensed employer (Private Patrol Operator) are to report an incident within 7 days of the incident occurring. The process of reporting an incident of an altercation with an armed guard, whether involving a firearm or not, begins with a Report of Incident Form (RIF). After an RIF is submitted an investigation can be initiated. The Bureau will also initiate an investigation if it receives information regarding an incident from law enforcement, a SB 468 (Hill) Page 9 of ? complaint, or a media article. After an investigation has been completed the Bureau can file both an administrative action and forward the case to the local District Attorney for potential criminal actions. If no criminal charges are pressed, then the licensee involved in the incident is subject to have their license revoked or suspended. If criminal charges are pressed, the Bureau will place a hold on the license until that license expires. The Bureau continues to pursue administrative action against the guard even if the convicted person is incarcerated, to revoke the license. Administrative action by the Bureau is made public on the Bureau's website upon the filing of an accusation by the Attorney General's Office. It is unknown how many incidents that meet the criteria for reporting are not reported to the Bureau since this is a process that depends upon self-reporting . However, if an incident rises to the level of a licensee/QM/registrant being arrested, the Bureau should receive a subsequent arrest report from the DOJ. Specifically, the number of guard shooting incidents is currently unknown because of this self-reporting system and because the current Consumer Affairs System (CAS) does not categorize reports based on the type of incident. There is currently no consolidated database at the Bureau that can supply quantifiable information as to the incident type in which a report was filed. Recommendation and Proposed Statutory Change: As a result of issues that have been raised about the effectiveness of the self-reporting process for firearms discharge incidents, this bill requires submission to the Director of the DCA of a firearms incident report by both the individual involved in the discharge incident as well as his or her employer. d) Issue: Firearms Training Facilities Oversight. Background: Any institution, firm, or individual seeking the Bureau's certification as a firearms training facility must complete an application that includes: 1) the name and location of the entity; 2) the places, days, and times the course will be offered; 3) an estimate of the minimum and maximum class size; 4) the location and description of the SB 468 (Hill) Page 10 of ? range facilities; and 5) the names and certificate numbers of the Bureau-certified firearms training instructors who will teach the course. In addition, each owner or principal of the training facility business must complete a Bureau personal identification application form, pay the specified certification fee, and submit fingerprints. The initial and continued education firearms training course offered by a Bureau-certified firearms training facility must comply with the content and format specified in the Bureau's Firearms Training Manual. However, the firearm training facility is not required to provide its specific course materials to the Bureau for approval. A Bureau-certified firearm or baton training facility, or Bureau-approved school that provides training to private proprietary security officers (PPSOs) or security guards does not need to be approved by the Bureau of Private Postsecondary Education (BPPE) in order to obtain the Bureau's certification or approval, unless BPPE's law requires that they be approved. The Bureau refers institutions to BPPE to verify their exemption from BPPE's law. There is no statutory requirement for the Bureau to inspect the approved schools and firearm/baton training facilities; however, the Bureau has the discretionary authority to do so. The Bureau carried out a firearm training facility pilot program in Fiscal Year (FY) 2012-13 and conducted 15 inspections, but due to staff and workload issues, the inspections were discontinued. However, the firearm/baton training facilities and approved trainers are inspected as part of an investigation in response to a complaint. The Bureau has the statutory authority to suspend or revoke a firearm/baton training school's certification for violations of the law. Also, the Bureau has the ability to cancel the approval of an approved trainer. Recommendation and Proposed Statutory Change: As a result of issues that have been raised about the comprehensiveness of firearms training facilities in providing adequate training to licensees who pursue a Bureau Firearm Permit, this bill will require the Bureau to conduct inspections of all firearms training facilities in the state of California SB 468 (Hill) Page 11 of ? to ensure compliance with applicable Bureau requirements, rules, and regulations. e) Issue: Training Exemptions for Federal Law Enforcement Officers. Background: The Private Security Services Act exempts specified peace officers from the firearm training required as a condition for issuance of the Bureau's Firearms Permit. Peace officers are already required to complete firearms training through their employing agency, hence the exemptions from the training required for issuance of the Bureau's Firearms Permit. Active duty peace officers may apply to be an armed or unarmed security guard. However, to carry a weapon as a security guard, a peace officer must have on his/her person, while performing the duties of a security guard, either a written authorization from his/her primary employer (law enforcement entity) giving the peace officer permission to carry a weapon while performing the duties of a security guard or the peace officer must have an exposed firearm permit issued by the Bureau. If the peace office is unable to obtain the written permission from his/her primary employer (law enforcement entity) the peace officer must apply for the firearm permit. Most law enforcement entities will not give a peace officer written permission on their department letterhead to carry a weapon, off duty, while performing the duties of a security guard. Therefore, the peace office must usually apply for the Bureau Firearms Permit. Specified active duty and level 1 & 2 reserve peace officers are also exempt from having to submit fingerprints for the security guard registration. However, a peace officer must submit fingerprints if the officer is also applying for the firearm permit. If the peace officer is only applying for the security guard registration they have the option of submitting or not submitting fingerprints. However, if they leave their primary employment with law enforcement (retired, quit, laid off, or fired) and have not submitted fingerprints they must notify the Bureau that they are no longer with law enforcement and return the security guard registration to the Bureau within SB 468 (Hill) Page 12 of ? 72 hours. If they wished to continuing working as a security guard they would have to reapply as a private citizen and complete the required training along with submission of fingerprints in order to obtain a security guard registration. Most peace officers, who work off duty as armed or unarmed security guards, prefer to submit fingerprints for both the security guard and the firearm permit. This allows a peace officer to retain the security guard registration and exposed firearm permit after the peace officer retires or changes employment status, and is no longer a sworn peace officer. California does not recognize Federal Law Enforcement Officers as California peace officers. Therefore, any Federal Law Enforcement Officer would not qualify for the same exemptions mentioned above that California peace officers would be eligible to receive. Federal Law Enforcement Officers are also already required to complete firearms training through their employing agency. Recommendation and Proposed Statutory Change: As a result of issues of redundant training requirements for Federal Law Enforcement Officers raised by the Bureau, this bill will exempt Federal Law Enforcement Officers from Bureau firearms, power of arrest, and baton required training courses if he or she has already completed a course of study in each of these subjects. This will make requirements and exemptions for Federal Law Enforcement Officers consistent with requirements and exemptions for California peace officers, whose prior training has been determined as sufficient for licensure. f) Issue: Concealed Carry for Private Investigators. Background: Currently, the Business and Professions (B&P) Code does not specifically prohibit Private Investigators (PIs) to carry a concealed weapon while carrying out an investigation covered by the PI Act. There is some concern about the transmittal of information from the Bureau to licensees that a PI with a Concealed Carry Weapon (CCW) permit (Penal Code §§ 26150 and 26155) may not carry that concealed weapon while carrying out an investigation SB 468 (Hill) Page 13 of ? covered by the PI Act. The ambiguity within the B&P Code and the aforementioned information provided to licensees by BSIS has caused confusion among PIs. Recommendation and Proposed Statutory Change: As a result of concerns raised by PI licensees, this bill will clarify that PIs who wish to carry a concealed firearm may do so if he or she possesses both a Bureau Firearm Permit and a CCW permit while carrying out an investigation. g) Issue: Evergreen Clause Disclosure. Background: Currently, Alarm Companies are exempt from specific disclosure requirements regarding automatic renewal provisions in their contracts, known as "Evergreen Clauses" or "Rollover Clauses". This clause in the contract allows for automatic renewal of the monitoring portion of the contract unless the customer cancels the contract in writing by the date indicated in the contractual agreement (normally 30 days before the contract ends). This clause, however, is not always apparent to the customer since Alarm Companies are not obligated to notify consumers of this contractual obligation. The Bureau has stated that it receives approximately 70 complaints per year related to Evergreen Clauses, which comprises 40% of all alarm company complaints received. Since these complaints involve a contractual agreement, the Bureau states that is it frequently limited in what it can do for the consumer. Recommendation and Proposed Statutory Change: As a result of an issue about consumer protection raised by the Bureau, this bill will require alarm companies to give their customers specific disclosure about any automatic renewal provisions in their contracts. 2.Related Legislation This Session. SB 465 (Hill) extends the operation of the Contractors' State License Board until 2020 and makes various changes to the Contractors' State License Law. ( Status: The bill will also be considered by this Committee at today's hearing.) SB 468 (Hill) Page 14 of ? SB 466 (Hill) sunsets the Board of Registered Nursing and makes various Changes to the Nursing Practice Act. ( Status: The bill will also be considered by this Committee at today's hearing.) SB 467 (Hill) extends the operation of the California Board of Accountancy until 2020 and makes several changes as it relates the DCA. ( Status: The bill will also be considered by this Committee at today's hearing.) SB 469 (Hill) extends the operation of the California State Athletic Commission until 2020. Makes changes to the laws governing the Commission's operations and the Commission's oversight of professional and amateur boxing, professional and amateur kickboxing, all forms and combinations of full contact martial arts contests, including mixed martial arts and matches or exhibitions conducted, held or given in California. ( Status: The bill will also be considered by this Committee at today's hearing.) AB 177 (Bonilla) extends the operation of the Board for Professional Engineers, Land Surveyors and Geologists and California Architects Board and Landscape Architects Committee until January 1, 2020. ( Status: The bill is pending in the Assembly Committee on Business and Professions.) AB 178 (Bonilla) extends the operation of the Board of Vocational Nursing and Psychiatric Technicians until January 1, 2020. ( Status: The bill is pending in the Assembly Committee on Business and Professions.) AB 179 (Assembly Committee on Business and Professions) extends the operation of the Dental Board of California until January 1, 2020. ( Status: The bill is pending in the Assembly Committee on Business and Professions.) AB 180 (Assembly Committee on Business and Professions) extends the operation of the Cemetery and Funeral Bureau until January 1, 2020. ( Status: The bill is pending in the Assembly Committee on Business and Professions.) AB 181 (Assembly Committee on Business and Professions) SB 468 (Hill) Page 15 of ? extends the operation of the Board of Barbering and Cosmetology until January 1, 2020. ( Status: The bill is pending in the Assembly Committee on Business and Professions.) NOTE : Double-referral to Senate Committee on Judiciary. SUPPORT AND OPPOSITION: Support: None on file as of April 21, 2015. Opposition: None on file as of April 21, 2015. -- END --