More Professions Seek Status : Licensing Panels--Easy to Create, Hard to Kill

It now takes a state license to run an auction in California. Lie detector operators will soon need licenses, too.

In the last five years, since the failure of a major effort to eliminate unnecessary licensing, dozens of groups--such as the auctioneers and lie detector operators--have been pounding on the doors of government, seeking for their own occupations the privileged status that only a license can bring.

In response, legislators have introduced bills to set up licensing boards for interior designers, travel agents, recreational therapists, electronic reporters and estheticians (cosmetics experts). In the coming year, sports agents, ticket agents and financial planners will probably be the subject of new legislation.

Only a few of the occupational groups seeking such legislation have succeeded in recent years. But those that fail almost invariably return, hiring lobbyists to press their cause.

And, as one key legislator described it, “in a moment of weakness,” the Legislature may grant the occupation or profession the licensure its lobbyists are seeking.

Once established, the licensing boards, operating with little public scrutiny, often push to expand their authority and to tighten requirements for entering the professions they regulate. Typically, the agencies are covered by a “grandfather” provision--initially granting licenses automatically to those already working at the trade or profession, without requiring them to take examinations or fulfill educational requirements.

Frustrated consumer groups claim that many licensing boards do more to protect the professions than the public.

And, once in place, a licensing agency is almost impossible to abolish.

Story of Failure

For example, an effort to kill the state Board of Fabric Care, which regulates dry cleaners, failed, despite the argument that the board had not lifted a dry cleaner’s license in more than a decade.

“When it comes to licensing there are basically two questions to ask,” said Gene Erbin, a director of the San Diego-based Center for Law in the Public Interest, which led the most recent effort to abolish the dry cleaners’ board.

“First, is there a legitimate regulatory function to perform? In the case of the dry cleaners, the answer is no. Then you have to ask, do they do the job? And the answer is almost invariably no.”

A spirited editorial in the center’s publication, the California Regulatory Law Reporter, contends that “creating crippled licensing boards is what the game is all about. Industry wants the appearance of regulation, but not the reality of regulation.”

Officials of several licensing boards, including the dry cleaners, argue that they are taking steps to deal with consumer complaints and to discipline incompetent or dishonest licensees.

Protection an Issue

Although they agree that their efforts are often hampered by inadequate budgets for enforcing rules, they say that eliminating licensing boards would leave consumers without any protection at all from unscrupulous operators, other than the courts.

Despite the fact that Gov. George Deukmejian has long talked about the need to eliminate unnecessary government regulation, his Administration has not yet developed an overall policy to determine which licensing boards are in fact needed.

Such a policy is not likely to be ready for as long as a year and certainly not in time for the coming legislative session, said Marie Shibuya-Snell, director of the state Department of Consumer Affairs.

The department supervises more than 40 boards and programs, which have issued 1.8 million licenses--about one for every 14 residents of California. (Several occupational groups are licensed by other agencies, including, for example, the Department of Real Estate, which licenses more than 300,000 agents and brokers).

Administration Opposition

In the last two years, the Administration actively opposed bills that would have licensed travel agents and interior designers, and backed the bill to abolish the dry cleaners’ board.

But one official within the Department of Consumer Affairs privately complained that the Administration was not forceful enough in lobbying its position.

And in 1983, Deukmejian signed legislation extending the life of the Board of Landscape Architects, long a target of those opposed to unnecessary regulation. And he allowed a bill to license polygraph examiners--lie detector operators--to become law without his signature.

At one point, the Administration had opposed both pieces of legislation.

A survey by The Times of several of the smaller licensing agencies that have been scalded by anti-regulatory criticism confirms at least some of the major complaints against them: The boards are always close to the occupations they regulate and only rarely do they discipline licensees.

- The Auctioneers Commission, one of the newest licensing entities, was launched in 1983 with a $5,000 gift from an industry group, the California Auctioneers Coalition, which hired the staff needed to prepare initial agendas and formulate operating rules. At its first meeting, in February, 1983, the governing board of the commission agreed to accept an $83,000 loan from the industry group. Although the loan was later refused because of legal questions, the commission’s office is furnished with used equipment donated by auctioneers.

The auctioneers’ board now has expanded authority to levy fines for such rule infractions as using plants, or shills, to bid up the price of goods, but it has only one part-time employee to run its enforcement program. However, new bonding requirements for auctioneers have enabled the board to pay out $30,000 to one seller whose auctioneers failed to pay him for items sold. The case resulted in the revoking of three licenses.

“We want to clean up the bad apples,” said auctioneer Sandy Hochman Jr., president of the auctioneers’ board. He added that one of his goals is to “bring the industry around . . . (and) to make consumers aware that it is an excellent way of buying equipment.”

- The state Board of Geologists and Geophysicists has successfully revoked only one license in 15 years, despite various complaints over what board minutes described as “inadequate or substandard work” by some of the 5,500 licensed geologists in the state.

In recent years, board members have been concerned about shoddy geological studies, focusing in recent months on cases where houses have slid off hillsides because of unstable geological conditions. Despite recent changes in the law that make it easier to lift a license, the board has little money to pursue complaints.

Board President Coreen Young said the board has modified its philosophy since 1978, when the membership was changed so that a majority of its members were outside the profession.

- In recent years, the 6,000 licensees of the Certified Shorthand Reporters Board have tightened their hold on coveted court reporter jobs around the state. No longer can attorneys or courts hire noncertified reporters to take verbatim statements or testimony.

At the same time, the board successfully opposed legislation that would have licensed electronic reporters, those who use tape recorders rather than manual shorthand machines to make transcripts. The board does not allow graduates of out-of-state court reporter schools to take the California qualifying exam unless they have had a year of on-the-job experience.

In two years, the board has revoked the license of only one licensee--for continuing to take depositions during a period when she had failed to renew her license.

“It’s like dealing with kids,” said the board’s chairman, Gary Cramer, a court reporter for the Los Angeles Municipal Court. “If kids think you’re going to spank them, they behave. (The threat of) revocation of a license keeps (shorthand reporters) in line.”

- Like many licensing boards, the Board of Landscape Architects has rarely exercised its authority to revoke a license. In 1983, the legislative analyst recommended that the board be abolished, arguing, for example, that the board had suspended only a single license and revoked none in three years. (The board is now attempting to revoke or suspend the license of one landscape architect who pleaded no contest to charges that he had accepted bribes as a City of Los Angeles employee).

Eliminating regulation of the profession--and the licensing of 1,650 individuals--”could be accomplished without undue harm,” the analyst concluded. The board’s own review of the national exam it requires for licensure concluded that well more than half of the 225 items on the test were flawed “they contained debatable answers, were lacking in clarity, contained questionable terms, or tested for trivial knowledge.” From 1979 to 1983, the failure rate varied between 54% and 72%.

Board officials say they have used their clout to make improvements in the national exam and that the board now has clear authority to levy fines against violators of board standards.

But the board continues to be frustrated with a basic inconsistency in the regulation of landscape architects: individuals who do the same work but do not use the title “landscape architect” are outside the board’s jurisdiction, said the board president, Mike McCoy.

McCoy, who is not a landscape architect, argues that license revocations are “flashy things to do. They get attention. But we can discharge our responsibilities by things that are not so flashy.”

- Partly in response to the continued threat of legislation that would abolish it, the state Board of Fabric Care is attempting to toughen its enforcement program. Recently the board’s executive officer issued a press release announcing a new policy to investigate dry cleaners who draw repeated complaints involving the loss or damage of customers’ goods. But critics point out that California is one of only two states to license dry cleaners, and the board has revoked only one dry cleaner’s license in more than a decade.

In 1984, the board did file a formal complaint seeking to suspend or revoke the license of an Orange County dry cleaner who pleaded guilty in court to preventing a state inspector from entering his plant.

- In 1983, the Legislature agreed to require licensing for lie detector operators beginning Jan. 1, 1984. But by the time all the members of the new Polygraph Examiners Board were appointed, it was mid-1984. And technically, all the lie detector operators in the state were in violation of state law if they continued to give polygraph examinations without a license.

Because of the legal snafu, the Legislature agreed to extend the date to Jan. 1, 1985. But with only a part-time executive director to run the program, it will probably be mid-1985 before qualified operators have the licenses that are now required.

Target on ‘Phonies’

The industry pushed for creation of the board “to get rid of the phonies,” said the board president, Christian Bement. He said that in his job as Thrifty Corp.’s vice president for labor relations, he prohibited the use of lie detectors because the profession is “not regulated. There is no certification and no policing.” Once state standards are in place, he said, “I would have no problems.”

Over the years there have been repeated attempts to abolish many of the boards, commissions and programs that regulate the various licensed occupations.

“Protection of the public is the only justification for business or professional licensing and regulatory boards,” wrote Caspar W. Weinberger in 1967, when he chaired the state’s watchdog board, known popularly as the Little Hoover Commission. In a letter to then-Gov. Ronald Reagan, Weinberger, now U.S. secretary of defense, said “that based on that criterion, none of the new groups seeking to be licensed in the Legislature this year meets that test, and several existing licensing boards should be abolished.”

The commission report called for ending the licensure of dry cleaners, shorthand reporters and marriage, family and child counselors. It also recommended that several boards be combined--the barbers’ board with the cosmetologists and the cemetery board with the funeral directors.

Action by Brown

In 1979, following passage of tax-cutting Proposition 13, then-Gov. Edmund G. Brown Jr. proposed abolishing or phasing out 15 professional licensing boards or programs, including many of the agencies targeted by the Little Hoover Commission more than a decade before. Added to the list were boards or programs that licensed tax preparers, architects and geologists.

Brown trimmed back funds for many of the programs, much to the displeasure of several board and commission members who pointed out that their revenue came primarily from license fees and should have been unaffected by the general fund belt-tightening that followed Proposition 13.

In 1978 and 1979, Lt. Gov. Leo T. McCarthy, who was then Speaker of the Assembly, led a major effort to review and perhaps abolish more than 20 regulatory boards and commissions. In most cases, he was asking for what is known as “sunset legislation,” setting deadlines for the different programs to satisfy the Legislature that they were effective or else go out of business.

“I got (the legislation) out of the Assembly because I was Speaker,” McCarthy said in a recent interview. “When they got to the Senate, some of the boards and commissioners wrote letters to every senator saying that I was trying to destroy them.”

Effort Dies

The legislation died, despite McCarthy’s assurances that most of the regulatory programs would have survived close scrutiny. “The attitude you get on boards and commissions is that as long as their budgets come from license fees, they really ought not to be subject to scrutiny and accountability.”

To defeat the sunset bills, the occupational groups hired their own lobbyists. “Usually they were second- or third-tier lobbyists. The little fellow with two or three or four small clients. They would say to Senator X, ‘This is my bread and butter. I’ve only got three clients, for heaven’s sake.’ A very human element came in. The senators felt sympathy for the lobbyists.”

Then, as now, many of the occupational groups also make political contributions. For example, the California Court Reporters Political Action Committee contributed $50,000 to legislators in 1983 and 1984, according to Legi-Tech, a private computerized information service. The Dry Cleaners and Allied Trades Political Action Council paid out more than $10,000 in the same period.

But McCarthy believes that contributions played a relatively small part in the ability of licensed occupations to defend their turf.

Sen. Leroy Greene (D-Carmichael), who authored the 1984 bill to eliminate the dry cleaners’ board, said that his bill probably was killed by individual dry cleaners persuading their own legislators to vote against the legislation.

“In theory the only reason why the state should license anyone is when it’s a matter of public protection,” Greene said. “That’s clearly the case in medicine, then it’s down hill from there. . . . I find the case for public protection in the area (of dry cleaning) underwhelming.”

Sen. Joseph B. Montoya (D-Whittier) chairs the Senate Business and Professions Committee that killed Greene’s bill to end the dry cleaners’ board.

Montoya said he believes that it would be useful to force all the licensing programs to justify their continuation, but he added, “I am convinced that all of these groups could, when the day comes, make a very good presentation to justify their existence. These groups develop their own momentum and it’s very difficult to get them sunsetted.”

‘Moment of Weakness’

Why had his committee and the Legislature as a whole decided to license lie detector operators? “Sometimes in a moment of weakness you finally give way,” he explained, adding that he had no real enthusiasm for the legislation to license them.

Consumer groups say they do not have the resources to fight every occupation that seeks licensure or to wage battles to kill existing licensing programs, said the Center for Law in the Public Interest’s Erbin. “There’s an enormous amount of work to do on just one bill.”

Erbin’s group would like, for instance, to see a bill to abolish the Board of Geologists and Geophysicists. But he complained, “No one wants to alienate all the geologists in the state. We couldn’t even beat the dry cleaners.”