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New Laws - 1996

Summary of law changes for the 1995-1996 Legislative Session

This is a summary of the more significant legislation that the Contractors State License Board has followed during the 1995 legislative session. All of the bills in the summary have been signed into law (chaptered), and become effective on January 1, 1996, unless noted. Copies of chaptered bills are available at or by calling (916) 445-2323.

AB 311 by Assembly Member Baca requires a licensed contractor to pay for dump truck services performed in one month by the 20th of the following month if properly billed by the 5th of the month in which payment is due. Payment is required to be made unless otherwise agreed to in writing by both parties. The law provides for a good faith dispute of charges. Violation of this section is a cause for disciplinary action and there are monetary penalties for overdue payments.

AB 717 by Assembly Member Ducheney establishes specific certification, training and continuing education requirements for construction inspectors, plans examiners and building officials who are employed by a local agency in a temporary or permanent capacity. The law exempts registered professional engineers, licensed land surveyors and licensed architects who contract with a local agency, but not those employed by the local agency. These sections also exempt certain currently employed officials as well as construction inspectors and plans examiners employed by city, county and district fire protection services.

AB 914 by Assembly Member Cunneen specifies that employers are not subject to penalties for failure to provide workers' compensation coverage IF they have entered into a valid and enforceable agreement with another employer to provide coverage for those employees and that employer as the primary employer has obtained workers' compensation coverage for those employees. This section exempts the secondary employer from tort liability in the event of employee injury and allows the secondary employer to secure payment of compensation on employees provided by the primary employer.

AB 1374 by Assembly Member Speier requires all state agencies, with limited exceptions, to accept payments in the form of credit cards or payment devices by January 1, 1997. This section also makes it a misdemeanor for a state employee who has access to the credit card information to use it for any unauthorized purpose.

SB 320 by Senator Petris prohibits a salesperson or others from soliciting home improvement contracts with a senior citizen if it involves getting a loan on the senior citizen's primary residence and the solicitation follows a pattern or practice in violation of federal law governing consumer loans.

SB 338 by Senator Campbell requires that the Legislature authorize either in the annual Budget Act or other legislation any expenditure by state agencies of revenues derived from the assessment of fines and penalties.

SB523 by Senator Kopp is a comprehensive law with some provisions becoming effective January 1, 1996 and other provisions becoming effective July 1, 1997. This law revises the procedures for administrative adjudications by expanding the hearing procedure options available to state agencies and by including additional due process and public policy requirements.

SB 639 by Senator Peace prohibits contractors from compensating in any way insurance agents who refer clients to them for repairs to or replacement of a commercial or residential structure covered by an unlawful commercial or residential insurance policy. This section also makes it unlawful for any contractor or his/her representatives to knowingly offer or give any discount intended to offset a deductible required by an insurance policy covering repairs to or replacement of a residential or commercial structure.

SB 1029 by Senator Calderon requires that an association for the common interests of a development satisfy certain conditions before bringing an action against the builder for a design or construction defect. Requires that a court determine whether the actions should be dismissed or if another remedy is possible when the association fails to satisfy the conditions.

SB 1061 by Senator Mountjoy clarifies and corrects several inconsistencies in the Contractors License Law including the statute of limitations for filing an action against an unlicensed contractor or licensed contractor, bidding on asbestos related projects, the definitions of a licensee, construction related civil judgments on contractors, the CSLB's authority over licenses that are expired, suspension of corporate licenses that are not in good standing with the Secretary of State, and warning notices on cancellations of workers compensation policies.

A legislative summary of all the bills relating to the Contractors Board and signed into law in 1995 is available by writing to the Contractors State License Board, Legislative Unit, PO Box 26000, Sacramento, California, 95826. One copy of the bills may be obtained from the Legislative Bill Room at the Capitol.

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