(a) A program administrator is subject to an inspection, examination, or investigation in accordance with Section 22701.
(b) If, in the course of an inspection, examination, or investigation of a program administrator, the commissioner has cause to believe that the program administrator, the PACE solicitor, or the PACE solicitor agent may have committed a violation of this division or any rule or order thereunder, or the commissioner seeks to obtain or provide information necessary to the commissioner in the administration of the division, with respect to a matter related to a PACE solicitor or PACE solicitor agent, and either this information is not available directly from the program administrator or the commissioner seeks to validate the information obtained from the program administrator, the commissioner may do the following:
(1) Inspect, examine, or investigate any and all documents, records, files, and communications of the PACE solicitor or PACE solicitor agent that are relevant to the violation or the matter. For purposes of the inspection, examination, or investigation, the commissioner and his or her representatives shall have access to the records of the PACE solicitor or PACE solicitor agent related to assessment contracts associated with the violation or matter.
(2) Require the attendance of witnesses and examine under oath all persons whose testimony he or she requires relative to the violation or matter.
(c) If, upon inspection, examination, or investigation, the commissioner has cause to believe that a PACE solicitor or PACE solicitor agent is violating any provision of this division or any rule or order thereunder, the commissioner or his or her designee shall exhaust the procedure set forth in paragraph (1) before bringing any action authorized under paragraph (2).
(1) (A) The commissioner shall issue a report to the program administrator, the PACE solicitor, and, if applicable, the PACE solicitor agent, identifying each violation of this division or any rule or order thereunder.
(B) The program administrator, PACE solicitor, and, if applicable, PACE solicitor, PACE solicitor agent, or any combination thereof, shall have the opportunity to provide a written answer to the report submitted pursuant to subparagraph (A) within a reasonable period.
(C) If upon expiration of that period, the commissioner believes further action is necessary or appropriate, the commissioner may do any of the following, in any combination:
(i) Demand a corrective action by the program administrator, PACE solicitor, PACE solicitor agent, or any combination thereof.
(ii) Demand the program administrator, PACE solicitor, PACE solicitor agent, or any combination thereof, stop violating the division, rule, or order.
(iii) Demand the PACE solicitor or PACE solicitor agent, or both, discontinue engaging in the business of soliciting property owners to enter into assessment contracts related to any or all program administrators, or demand the program administrator deauthorize the PACE solicitor or PACE solicitor agent, or both, for a defined period not exceeding 12 months, or indefinitely.
(D) If the program administrator, PACE solicitor, and PACE solicitor agent, as applicable, agree to the commissioner’s demand issued under subparagraph (C), or otherwise reach a mutually agreeable resolution with the commissioner, the examination and correspondence related thereto shall remain confidential under paragraph (2) of subdivision (d) of Section 6254 of the Government Code. The commissioner may make publicly available the identity of any PACE solicitor or PACE solicitor agent, or both, who has agreed to discontinue engaging in the business of soliciting property owners to enter into assessment contracts.
(E) If the program administrator, PACE solicitor, or PACE solicitor agent, or any combination thereof, do not agree to the commissioner’s demand issued under subparagraph (C), or otherwise reach a mutually agreeable resolution with the commissioner within a reasonable period, the commissioner may proceed under paragraph (2) or subdivision (d).
(2) Upon exhaustion of the procedure in paragraph (1), the commissioner may bring an order against a PACE solicitor, PACE solicitor agent, or both, as provided in this paragraph.
(A) The commissioner may order a PACE solicitor or PACE solicitor agent, or both, to desist and refrain from engaging in business as a PACE solicitor or PACE solicitor agent, or further violating this division, or the rules thereunder, in accordance with clause (i) and (ii) of this subparagraph. This paragraph does not authorize the commissioner to restrict the ability of a PACE solicitor or PACE solicitor agent to engage in any business that does not involve soliciting a property owner to enter into an assessment contract.
(i) If, within 30 days of the receipt of the order, the PACE solicitor or PACE solicitor agent, or both, fails to request a hearing, the order shall become final.
(ii) If, within 30 days of the receipt of the order, the PACE solicitor or PACE solicitor agent, or both, requests a hearing, the hearing shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.
(B) The commissioner may, after appropriate notice and opportunity for a hearing, by order, censure or suspend for a period not exceeding 12 months, or bar any natural person from directly or indirectly soliciting a property owner to enter into an assessment contract, in accordance with clause (i) to (iv), inclusive, of this subparagraph. This paragraph does not authorize the commissioner to restrict the ability of a natural person to engage in any business that does not involve soliciting a property owner to enter into an assessment contract, or being employed by a PACE solicitor in a capacity that does not involve soliciting a property owner to enter into an assessment contract.
(i) Within 15 days from the date of a notice of intention to issue an order pursuant to this subparagraph, the person may request a hearing under the Administrative Procedure Act (Chapter 4.5 (commencing with Section 11400) of Division 3 of Title 2 of the Government Code).
(ii) Upon receipt of a request submitted pursuant to clause (i), the matter shall be set for hearing to commence within 30 days after the commissioner receives the request pursuant to clause (i), unless the person subject to the notice consents to a later date.
(iii) If no hearing is requested within 15 days after the mailing or service of the notice of intention as described in clause (i), and the commissioner does not order a hearing, the right to a hearing shall be deemed to be waived.
(iv) Upon receipt of a notice of intention to issue an order pursuant to this subparagraph, the person who is the subject of the proposed order is immediately prohibited from directly or indirectly soliciting a property owner to enter into an assessment contract.
(d) Upon exhaustion of the procedure in paragraph (1) of subdivision (c), if after investigation, the commissioner has reasonable grounds to believe that a person is conducting business as a PACE solicitor or PACE solicitor agent, or both, in an unsafe or injurious manner that will result in irreparable harm, the commissioner shall, by order, direct the person to discontinue the unsafe or injurious practice, in accordance with the following:
(1) The order shall be effective immediately.
(2) If, within 30 days of the receipt of the order, the PACE solicitor fails to request a hearing, the order shall become final.
(3) If, within 30 days of the receipt of the order, the PACE solicitor requests a hearing, the hearing shall be conducted in accordance with Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.
(e) An order brought under paragraph (2) of subdivision (c) or subdivision (d) shall be public.
(f) A PACE solicitor or PACE solicitor agent subject to this section shall not be subject to Chapter 4 (commencing with Section 22700).
(g) The commissioner shall not be bound to the provisions of this section in connection with his or her enforcement of this division with respect to a program administrator.
(Added by Stats. 2017, Ch. 475, Sec. 71. (AB 1284) Effective October 4, 2017. Section operative January 1, 2019, pursuant to Section 22696.)
Last modified: October 25, 2018