HIGHLIGHTS OF
THE CONTRACTORS STATE LICENSE BOARD
FULL BOARD MEETING

August 3, 2007
By Sam K. Abdulaziz

    ► FORMER BOARD MEMBER LARRY BOOTH WAS MISSED

                             ► TOO MUCH HAPPENING FOR COMPLETE REPORT

                                                      ► REGISTRAR COMMENDED FOR HIS WORK

The Contractors’ State License Board held a full Board Meeting on Friday, August 3, 2007 in Sacramento, CA.

Larry Booth, former Board Member and Chair, has termed out. He will be missed. He was both active and understood the construction industry.

There was so much information dealing with what the Board has and will be doing that it would be impossible to report on all of it.

The following Board Members were present:

Chair, James Miller; Vice Chair, Donald Zampa; Cynthia Mitchell; Eddie Barnes; Robert Brown; Matthew Kelly; Louise Kirkbride; Robert Lamb; Ed Lang; Stephen Matich; and John O’Rourke.

Board Member that was absent was Bernadette Medrano.

There are three vacant positions on the Board.

At the last Board Meeting, the following officers were recommended and by a motion duly made and carried 12 to 0, the following Board Members hold the following positions.

Jim Miller – Chair

Donald Zampa – Vice Chair

Cynthia Mitchell – Secretary

Former Chair, Matthew Kelly, was commended for his stewardship of the Board.

Board Chair, James Miller, reported that the annual evaluation of the Registrar showed that the Registrar had done an outstanding job. His work was commended by the Board.

A special commendation was given to the entire SWIFT team for its performance during the Angora fire. This will be discussed in more detail in the Enforcement Committee report.

I. Legislative Committee Report

Steve Matich, the Legislative Committee Chair, presented the Legislative Committee Report with the able aid of Mike Brown.

A. Board Sponsored Bills

AB 243 (Nakanishi)

This was signed into law. Among other things, this changes that statute of limitations of when the Contractors’ Board can file a disciplinary action. The new statute states that the Contractors’ Board has two years to file a disciplinary action after discovery of the conviction. The present law stated that it would be four years from the date of conviction. Since many of the fingerprints are not in the fingerprint database, no information is available concerning criminal conduct of those individuals. Therefore, the Contractors’ Board may not learn of the relevant conviction of a licensee until it is too late. This is the reason to have the statute run from the conviction.

This new statute also authorizes disciplinary action regarding an alleged breach of an express written warranty to be filed within 18-months from expiration of the warranty rather than within four years after a patent act or omission is alleged.

There was no opposition to that legislation.

AB 244 (Nakanishi)

This bill has passed the Senate Business, Professions, and Economic Development, and Senate Judiciary Committees. It is awaiting a vote in the Senate. However, there appears to be no opposition posted.

This bill clarifies some of the language dealing with home improvement contract requirements. For years, the law has been that a home improvement contractor who furnishes a bond (or some equivalent in the proper amount) is exempt from including progress payment details and progress payment payments. It also states they are exempt from the down payment restriction statement that would otherwise be required in contracts. This has never been necessary because the statute is clear that one who posts a bond or equivalent is not required to put the above statement in his contract. This bill merely clarifies that.

Further, existing law has no provision for an oral contract relative to the statute of limitations. However, oral contracts are a violation of the home improvement act as well as Service and Repair contracts. Unlicensed contractors rarely put their contracts in writing. Some District Attorney offices are reluctant to indict them. The CSLB is hopeful that District Attorney’s offices will pursue these cases if the bill is chaptered. There appears to be no opposition.

AB 455 (Cook)

This bill passed the Senate Business, Professions and Economic Development Committees. It is nothing but a housekeeping requirement setting out the number of Board Members required for passing of motions and actions. The opposition listed is the Department of Consumer Affairs.

AB 456 (Cook)

This bill passed the Senate Business, Professions and Economic Development Committee. It has been sent to Senate Appropriations. This bill would authorize a continuous appropriation for the Construction Management Education Account. This money would come from voluntary contributions made by licensees and interested groups. There is no opposition posted.

SB 354 (Margette)

This bill will extend the CSLB’s power to go after a licensee who is aiding and abetting an unlicensed contractor and a consumer has been financially injured. This passed the Senate and was sent to the Assembly. It is currently being amended at the request of the CSLB, although it is awaiting a vote on the Assembly Floor.

SB 797 (Ridley-Thomas)

This bill passed the Senate and all of the Assembly Committees. It is currently on the third reading file on the Assembly Floor. There is no opposition on file. This is clean up legislation. Some District Attorneys have been unwilling or unable to press misdemeanor charges in certain cases of tree trimming and tree removal services because the licensing law is not specific regarding offering or bidding for these services.

SB 237 (Dutton)

This bill is the Contractors' State License Board version of a Mechanic’s Lien statute. It is now a two-year bill.

II. Executive Committee Report

A. Risk Assessment

Chief Deputy Registrar, Denise Brown, reported on the Risk Assessment Project. It appears that the personnel as well as the equipment are better protected.

B. Budget Briefing

The CSLB’s fiscal year 2006/07 final budget contains a net appropriation of $53.7 million and it has spent $42.4 million (79%) of its budget.

C. Succession Planning

This shows that the Contractors’ Board thinks ahead. They are concerned about Succession Planning.

The CSLB has conducted an initial analysis of the work force and it is anticipated that 44.7 % of 374 classification positions are over the age of 50. Many of the Board’s employees could retire right now. This could cripple the operations of the Board. The Board is actively working on this problem.

D. Review and Approval of the Revised 2007 Strategic Plan

The Board approved the Strategic Plan presented on May 9, 2007, with some minor changes. They also agreed to go over a Strategic Plan in April.

III. Enforcement Committee Report

A. Enforcement Program Update

1. Complaint Handling Statistics

Enforcement people are continuing to reduce the number of open complaints and the aging of open complaints.

2. Proposed Criteria and Schedule to Conduct Office Audits

Just like real world companies, the Enforcement Division Program Managers have developed criteria for conducting office audits of all Enforcement Division operations. The main purpose is to identify potential improvements and provide consistency. The audits commenced July 2007 and are expected to conclude December 2007.

3. Disaster Response Update

Public Affairs Chair, Rick Lopes, showed portions of videos dealing with the South Lake Tahoe fire . These were taken from various TV. Station reports. Another feather in the hat of the CSLB.

Northern SWIFT staff were on the front lines providing proactive assistance and enforcement, educating affected homeowners and establishing effective partnerships with relevant local, state and federal agencies.

More than 250 homes were destroyed, 13 damaged and more than 3,000 acres burned. The CSLB joined with nearly a dozen other agencies. SWIFT staff answered the call to duty and maintained a constant presence.

Public Affairs printed several hundred-yard signs entitled “Homeowners beware.” Staff provided assistance and CHP checkpoints established in burn areas. The staff also coordinated with other agencies and conducted a sting at one of the homes that was destroyed by wildfire, after inviting suspected unlicensed contractors to bid on debris removal and various reconstruction projects. Five unlicensed operators were arrested and booked. All of the individuals arrested were from outside the South Lake Tahoe area.

4. Enforcement Division Updates

a. Complaint Handling

Fiscal Year 2006/07 started with an inventory of 4,509 open complaints. 110 were aged over 365 days. At the end of the Fiscal Year, only 25 were aged over 365 days. The caseload is manageable.

b. Intake and Mediation

There are so many things at Intake and Mediation that only some will be highlighted.

(i) The Sacramento Intake and Mediation staff teamed up with SWIFT for double arrest operations.

(ii) Norwalk Consumer Service Representative negotiated a $10,000 refund to a homeowner.

(iii) San Francisco District Attorney files 18 felony counts against unlicensed contractor.

(iv) On-Site negotiation results in $21,000 in savings to the public.

c. Case Management

Mandatory Settlement Conferences and Alternative Dispute Resolution Mediations have been very successful. This has gone on in both Sacramento and Norwalk.

For Fiscal Year 2006/07, 485 Settlement Conferences were completed. 403 cases did not go to a hearing. This represents a savings of over $2,000,000.00.

5. Proactive Enforcement

a. Stings and Sweeps

Stings and sweeps are awesome. Further, the CSLB Enforcement staff continues to partner with other agencies.

b. Arrests and Convictions

(i) A CSLB peace officer arrested an unlicensed person operating with back up from the Sacramento police department. Another arrest operation; Northern SWIFT arrested one person for elder abuse, grand theft, and diversion of funds.

(ii) One person plead no contest to charges of contracting without a license, illegal advertising, fraudulent use of another contractors license and a violation of the Labor Code for failure to obtain workers’ compensation. He was sentenced to two years probation and community service and ordered to pay $5,500 in CSLB penalties.

(iii) Another revoked licensee was sentenced to five years in prison for one felony count of theft from an elder, three felony counts of diversion of construction funds, and one misdemeanor count of contracting without a license.

(iv) Another brazen and illegal operator and multiple offender was sentenced to five years in state prison in July on charges including extortion by use of false mechanic’s liens.

6. First Annual CSLB Elder Abuse Investigative Training Seminar

The First Annual CSLB Elder Abuse Investigative Training Seminar was conducted at the Department of Consumer Affairs headquarters in Sacramento. Registrar, Steve Sands, gave the opening remarks and welcomed the more than 100 attendees involved in the detection, prevention, and prosecution of elder abuse. One of the primary objectives was to establish and strengthen the relationships among various enforcement agencies.

B. Unlicensed Consultant Action Plan

1. Introduction

Unlicensed consultants have been around for a long time. They are getting more prolific. The CSLB states that many of them are revoked licensees or unqualified individuals. They act as liaisons for property owners with local building departments and the California Housing and Community Development Department. They are performing or directing work on pool and manufactured home projects. They operate in the underground economy. Typically, paid in cash and failing to pay taxes or provide workers’ compensation insurance for their employees. That is just some of it.

The CSLB staff has been conducting meetings with building officials throughout the state as well as industry representatives to determine new strategies for dealing with these specific problems. These meetings resulted in an action plan.

The proposed joint efforts are designed to take place in various stages and focus direction on unlawful advertisement and unlicensed individuals and pursue disciplinary action for building permit abuses by unlicensed manufactured home and swimming pool consultants.

2. The Plan

Staff met with CALBO to discuss the Declaration Form which is required for building permits.

Staff will be providing additional training regarding permit requirements for manufactured housing, swimming pools and owner/builder licensure.

Pilot projects have started in Norwalk and El Dorado County to review business licenses to unlicensed people in the construction business and advertising on Craig’s list.

C. Review of Consumer Satisfaction Survey: 2006 Complaint Closures

1. Survey Results

The 2006 Customer Satisfaction Survey showed a slight increase in the overall satisfaction by consumers that used CSLB services to handle their complaints against contractors.

2. Complaint Closures

For the calendar year 2006, a total of 4,800 (400 per month) were randomly selected to receive surveys during two mailing periods. The 2006 survey used the same post card questionnaire that was used previously. Eight of the nine statements on the survey were identical to the statements used since 1993. The response rate is 4% lower than the return rate for the 2005 survey. Since the inception of this survey in 1993 through 1998, the results showed consistent increase in consumer satisfaction. However, in 1999 and 2000, all service categories showed a decrease in satisfaction In 2001, six service categories showed an increase and two categories showed a decrease. In 2002, all service categories showed a 1% to 3% increase in satisfaction compared to 2001. Jumping to 2005, all of the service categories showed a 1% to 3% increase compared to 2004.

IV. Licensing Committee Report

Eddie Barnes, Licensing Committee Chair, gave the report.

Licensing Committee substantially decreased waiting time, since the last report.

A. Licensing Program Update

1. License Application Workload

License Application workload has increased slightly from past fiscal year.

2. Licensing Transaction Processing Times

Through the use of overtime, temporary help, and redirection of staff, the processing time remained within acceptable times.

3. Licensing Information Center Update

Licensing Information Center’s average wait time for the past three months has remained under 3 minutes.

B. Testing Division Update

1. Test Center Status

The waiting time for an examination date is currently 17 to 18 weeks for applicants who test in San Bernardino. This test center has not yet completed the work to be done for shorter wait times. The wait time for other test centers is 3 to 4 weeks. The Board is trying to meet its goal of a waiting time of 3 weeks statewide for the examination waiting process. They are trying to increase the capacity of the number of seats.

2. Examination Administration and Development Software

The new test administration system, SCORE, developed in-house by the Testing Division is aces. It was successfully launched in Sacrametno, March 8, 2007. It is functioning extremely well. Candidate feedback and staff feedback has been very positive.

C. Criminal Background Unit and Fingerprinting Update

Since the program began, the CSLB received nearly 111,000 transmittals from the Department of Justice. The CSLB received Criminal Background Unit offenders of 17,000 applicants. Of the 17,000, 660 applications were denied and 300 appealed. 92 of the 300 appealed have been issued probationary licenses. The Criminal Offender Record Information was taking about 5.5 months. As a result of changes made in triaging, the processing time is now down to just under two months.

In December 2006, the Criminal Background Unit began coordinating efforts with the Enforcement Division for the purpose of addressing the high number of licensee denial appeals. Approximately 50% of the applicants who are denied licensure, based on a criminal conviction appeal the denial decision and request a hearing regarding the issue. The joint effort has taken a dual approach in reducing the number of cases that go to hearing. The staff implemented better procedures for communicating with the applicants during the review process. This reduced the waiting time substantially.

D. Strategic Plan

The Licensing Division has set up its own Strategic Plan. That Strategic Plan includes the following:

1. Hire a consultant to study the long-term impact of the Imaging Workflow Automated System (IWAS).

2. Increase exam seating by expanding Norwalk, San Bernardino, Fresno and San Diego testing centers.

3. Reestablish an e-mail unit in the Licensing Division.

4. Create two (2) dedicated bilingual positions in Licensing Information Center.

5. Conduct a study on a one-step, comprehensive license check system.

6. Create a photo ID pocket registration card for Home Improvement Salespersons.

V. Communication & Education Committee Report

Committee Chair, Bob Lamb, gave the report.

A. Public Affairs Program Update

Just like the Enforcement Division, the Public Affairs Division just keeps going and going and going. Just some of the highlights were:

· Two media events were held, one in Escondido and the other in South Lake Tahoe.

· Coordination of all CSLB enforcement activities related to the Angora fire with press offices at various places.

· Coordination of CSLB participation in story being produced by NBC news.

· Distribution during the week of July 16, of the summer edition of “CSLB Matters” to CSLB employees.

· Development along with Enforcement Division of a “Most Wanted” feature of the CSLB website.

· Coordination of presentations of “Senior Scam Stopper” outreach events. Between May 1 and July 9, eight events were held.

· Distribution of “Ask the Board” articles to newspapers around the state. The articles are distributed to both English and Spanish language newspapers.

· Development of a “Request for Proposal” for a new public relations contract.

· Hiring of one full-time staff member. The Public Affairs office is now fully staffed at 5 ½ positions (I wonder who that ½ person was).

B. Public Affairs

1. Office Update

The “Most Wanted” website feature project is being completed in the Enforcement Division to create a “Most Wanted” list.

The Public Affairs Office coordinated the production of a training video for the Governor’s Economic and Employment Enforcement Coalition.

Senior Scam Stopper/Community Events continue.

The Sacramento Public Relations Association awarded Katz & Associates two “Gold Cappies” for its work on the CSLB’s statewide Public Awareness Program. One was for the Continuing Public Relations Campaign, the other was for the “Ask the Board” columns.

There was much more.

VI. Tentative Schedule

November 1, 2007, San Diego

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HIGHLIGHTS OF THE CONTRACTORS STATE LICENSE BOARD FULL BOARD MEETING August 3, 2007 By Sam K. Abdulaziz