BILL ANALYSIS Ó SB 468 Page 1 Date of Hearing: August 19, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair SB 468 (Hill) - As Amended July 14, 2015 ----------------------------------------------------------------- |Policy |Business and Professions |Vote:|11 - 3 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill subjects the powers and duties of the Bureau of Security and Investigative Services (Bureau) to sunset review by the Legislature as if its governing statutes were scheduled for repeal on January 1, 2020. The bill also requires applicants for armed security guard SB 468 Page 2 licensure to submit proof of a psychological examination with the application for a firearms permit, requires the Bureau to inspect all firearms training facilities, and makes several other changes to the laws under the Bureau's regulatory authority. FISCAL EFFECT: 1)Ongoing costs to the Bureau of approximately $300,000 annually (Private Security Services Fund), and 3 PY of enforcement staff, to conduct compliance inspections of firearms training facilities. The Bureau currently has 367 licensed firearm training facilities and assumes a 5% increase annually. 2)Ongoing costs to the Bureau of approximately $354,000 annually (Private Security Services Fund), and 3.6 PY of licensing staff, to process psychological examinations submitted with Firearm Permit applications. The Bureau receives an average of 25,734 new and renewal applications each year and estimates each evaluation will take about 15 minutes to review. 3)Onetime costs of approximately $397,000 to add psychological testing and firearm inspection codes to the BreEZ system. The Bureau anticipates these costs to be absorbable within existing resources. 4)Unknown penalty and fine revenue gains (Private Security Services Fund). SB 468 Page 3 5)Staff notes that the Bureau has projected expenditures of approximately $12.1 million (mainly from the Private Security Services Fund) annually, supporting 51.4 PY. This is offset by the collection of approximately $12.1 million in fee revenues. Staff also notes that the Private Security Services Fund and the Private Investigator Fund have revenues and expenditures that are in balance, and both funds have healthy reserves to fund the additional expenditures related to this bill. COMMENTS: 1)Purpose. This bill is one of several sunset review bills introduced this year intended to provide continued oversight and accountability to the many boards and bureaus under the Department of Consumer Affairs (DCA). The bill codifies a sunset date for the Bureau for the first time and addresses several issues that arose during the sunset review process, primarily concerning armed security guards. According to the Author, "This bill is necessary to ensure continued oversight of alarm companies and their employees, locksmiths, private investigators, private security services, proprietary security services, and repossessors." 2)Background. Under existing law, the Bureau, within DCA, 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 SB 468 Page 4 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. The Bureau is responsible for regulating six Acts under state law, including the Alarm Company Act, the Locksmith Act, the Private Investigator Act, the Private Security Services Act, the Proprietary Security Services Act, and the Collateral Recovery Act. The Bureau had its first sunset review hearing by the Legislature in 2015, but there is no sunset date of the Bureau in existing law. This bill subjects the Bureau to further review by January 1, 2020, as well as addresses several concerns raised during this year's review process. 3)Armed Security Guards. 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 and Department of Justice (DOJ) for a criminal background check. Guards who apply for a Bureau Firearm Permit must submit a second set of fingerprints to obtain a DOJ Firearm Eligibility SB 468 Page 5 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. As a result of concerns raised during the sunset review process, 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. 4)Firearms Training Facilities Oversight. Any institution, firm, or individual seeking the Bureau's certification as a firearms training facility must complete a detailed application. In addition, each owner or principal of the training facility business must complete a 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, but the firearm training facility is not required to provide its specific course materials to the Bureau for approval. The Bureau has the authority, but is not required, to inspect the approved schools and firearm/baton training facilities. The Bureau conducted 15 inspections in 2012-13, but currently SB 468 Page 6 only conduct an inpsection in response to a complaint. The Bureau has the statutory authority to suspend or revoke a firearm/baton training school's certification, as well as to cancel the approval of an approved trainer for violations of the law. As a result of issues raised during the sunset review process regarding adequate training for licensees pursuing a Bureau Firearm Permit, this bill will require the Bureau to conduct inspections of all firearms training facilities to ensure compliance with applicable Bureau requirements, rules, and regulations. 5)Related Legislation. a) SB 177 (Wiekowski), on the governor's Desk, extends the authorization of Bureau to issue an alarm company operator license to a limited liability company (LLC) until January 1, 2019. b) AB 281 (Gallagher), pending in the Senate Appropriations Committee, establishes a Collateral Recovery Disciplinary Review Committee within the Bureau; authorizes licensed repossessors to display a printout of their registration or a screenshot of their registration from Bureau's website; and makes other clarifying changes. c) AB 921 (Jones), pending on the Senate Floor, establishes a Private Investigator Disciplinary Review Committee within Bureau and authorizes an applicant for an original license, or renewal of a license as a private investigator, to put his or her email address on the application at his or her discretion. SB 468 Page 7 d) AB 1042 (Cooper), pending in the Senate Appropriations Committee, expands the definition of a proprietary private security officer (PSO) and includes examples of a PSO's duties that are likely to involve interacting with the public. e) AB 1097 (Holden), pending on the Senate Floor, authorizes alarm companies to distribute contracts to customers by electronic means, as specified. 1)Sunset Review Legislation. This bill is one of five Senate measures introduced this session to extend the sunset on licensing boards within DCA - including SB 465 (Hill), pending in the Business and Professions Committee, and SB 466 (Hill), SB 467 (Hill), and SB 469 (Hill), pending with this Committee. Five additional sunset extension bills were introduced by the Assembly, AB 177 (Bonilla), AB 178 (Bonilla), AB 179 (Assembly Committee on Business and Professions), AB 180 (Assembly Committee on Business and Professions), and AB 181 (Assembly Committee on Business and Professions). All are pending in the Senate Appropriations Committee. Analysis Prepared by:Jennifer Swenson / APPR. / (916) 319-2081 SB 468 Page 8