Assembly Speaker John Perez after the passage of AB 113, to help expedite the state's approval of business startup filings.
Amid reports of backlogs that, at one time, stretched back almost three months, the Legislature appears poised to show some remarkable speed in helping those waiting to open their own business.
"This shows a great coming together of the business community and elected officials from both parties," said Assembly Speaker John Pérez on Monday.
His comments came at a news conference just after the lower house approved an extra $2 million for Secretary of State Debra Bowen to expedite the review and approval of documents business owners -- by law -- must file.
And, again, the speed by which the Assembly took action on an issue that was gaining traction (and scorn) in the media was impressive; the bill had only been written 96 hours before the vote that sent it on to the state Senate, where it's widely expected to quickly be ratified and sent to Gov. Jerry Brown.
The money would be for Bowen's Business Programs Division to process forms faster through overtime and other staff costs through June 30. It's expected the Legislature will consider as much as another $9 million to help the business filings process in the budget year that begins on July 1.
Those lined up at the secretary's downtown office on Monday were being told the current wait for approval of most documents is 29 days. The wait, say staff, fluctuates based on the time of year -- and is especially long after end-of-the-year document filings pour in. At one point, it was estimated that budding entrepreneurs were having to wait as long as 80 days for paper-based documents to be reviewed.
(The secretary's own website says they are just now processing documents for limited liability companies and limited partnerships that were received by mail on January 14.)
Pérez told reporters that the goal of the extra funding is no more than a seven day wait by this June, and only a five day wait for forms to be approved by November.
Those kinds of short delays are common in other large states like New York and Texas. The current system requires a startup business to pay more than 20 times the normal cost to have forms processed quickly.
"$350 versus $15," said Rusty Oshita, a health care independent contractor from El Dorado Hills. He chose the cheaper version, saying that he could wait.
But others can't.
"Without a fix to this problem," said John Kabateck of the National Federation of Independent Business California, "future neighborhood bookstores, auto shops, dry cleaners, farms will take months and months, if not longer... to get their businesses going , contribute to the economy, and create jobs."
Kabateck and a host of other business heavyweights stood shoulder to shoulder with the Democratic speaker after the bill was passed, perhaps the only time in recent memory critics of the majority party's record on business friendliness have done so.
But a not-so-quite-clear part of the push to fix the problem... is why the problem has persisted for so long. In testimony last week to an Assembly budget subcommittee, Secretary Bowen said that 2007 was the last time the days in waiting for approval of business filings had been in the single digits.
(Bowen's spokesperson now says the wait briefly dropped to five days for processing some forms late last year.)
For starters, Speaker Pérez said he assumed the problems were fixed last year, after the Assembly redirected $1.2 million of its operating cash to the secretary of state's business filing program. And that may help explain why Pérez touted that the new Assembly Bill 113 includes a requirement of monthly updates on the wait time being incurred by budding businesses.
Secretary Bowen's staff points out that legislators shouldn't have been surprised by the slowdowns after several years of deep budget cuts to her agency, including worker salary cuts that meant the paperwork was simply piling up.
And at the recent subcommittee hearing, Bowen herself expressed frustration with a state government procurement process that won't result in a new $24 million automated, online system for filing business documents (PDF) until 2016.
That project began in 2010.
"I think we spend a ridiculous amount of money doing the paperwork that's even necessary to get the project on the docket to be done," she told assemblymembers.