Professional & occupational licensing : Business Standards Divisions Department of Labor and Industry PDF
Preview Professional & occupational licensing : Business Standards Divisions Department of Labor and Industry
s 354.9 L72POL 2004 Legislative Audit Division State ofMontana Report to the Legislature Performance Audit June 2004 & Professional Occupational Licensing STATF DOCUMENTS COLLECTIL Business Standards Division Ann oy2004 Department ofLabor and Industry MONTANA STAIt LlbKA,^". 1515 E. 6th AVE. HF1.ENA. MONTANA 59G2' This report provides findings and recommendations relating to HouseJoint Resolution 20, which requested a series ofperformance audits ofprofessional and occupational licensing boards administratively attached to the Department ofLabor and Industry. Five aspects ofprofessional and occupational licensingwere examined: > Licensing fees and board funds. > Board disciplinary activities. > Department administrative procedures. > Public and professional representation on licensing boards. > Education and experience requirements applied as a condition of licensure. Direct comments/inquiries to: Legislative Audit Division Room 160, State Capitol PO Box 201705 MX 04P-02/04P-08 Helena 59620-1705 Help eliminate fraud, waste, and abuse in state government. Call the Fraud Hotline at 1-800-222-4446 statewide or 444-4446 in Helena. MontanaStateLibraiy 3 0864 1003 0419 8 PERFORMANCE AUDITS Performance audits conducted by the Legislative Audit Division are designed to assess state government operations. Fromthe audit work, a determination is made as to whetheragencies and programs are accomplishing their purposes, and whether they can do so with greater efficiency and economy. The audit work is conducted in accordance with audit standards set forth by the United States General Accounting Office. Members of the performance audit staff hold degrees in disciplines appropriate to the audit process. Areas of expertise include business and public administration, statistics, economics, political science, criminaljustice, computer science, education, and law. Performance audits are performed at the request ofthe Legislative Audit Committee which is a bicameral and bipartisan standing committee ofthe Montana Legislature. The committee consists ofsix members ofthe Senate and six members oftheHouse ofRepresentatives. MEMBERS OF THE LEGISLATIVE AUDIT COMMITTEE SenatorJohn Cobb RepresentativeDee Brown SenatorMike Cooney Representative Tim Callahan SenatorJimElliott, Vice Chair Representative Hal Jacobson SenatorJohn Esp Representative JohnMusgrove SenatorDan Harrington Representative JeffPattison, Chair SenatorCorey Stapleton Representative Rick Ripley LEGISLATIVE AUDIT DIVISION Scott A. Seacat, Legislative Auditor ml JJ\ Deputy Legislative Auditors: John W. Northey, Legal Counsel yB^^^^Tl •'™ Pellegrini, Performance Audit & Tori Hunthausen, IS Audit Operations James Gillett, Financial-Compliance Audit June 2004 The Legislative Audit Committee ofthe Montana State Legislature: This is ourperformance audit ofprofessional and occupational licensing boards. This audit was conducted in response to House Joint Resolution (HJR) 20, passed during the 2003 legislative session. HJR 20 requested we examine the activities ofprofessional and occupational licensing boards administratively attached to the Department ofLabor and Industry. This report provides information to the Legislature regarding professional and occupational licensing. Findings and recommendations address board and department organization, licensing A fees and board finances, application and renewal procedures, and board disciplinaryactivities. written response fi-om the department is included at the end ofthe report. We wish to express ourappreciationto board members, department staffand licensees fortheir cooperation and assistance during this audit. Respectfully submitted. / Scott A. Seacat Legislative Auditor Room 160, StateCapitol BuildingPO Box 201705 Helena. MT 59620-1705 Phone(406)444-3122 FAX (406)444-9784 E-Mail lad(gstale.mt.us Digitized by the Internet Archive in 2010 with funding from Montana State Library http://www.archive.org/details/professionaloccu2004mont Legislative Audit Division Performance Audit & Professional Occupational Licensing Business Standards Division Department of Labor and Industry Members ofthe audit staffinvolved in this audit were Angie Grove, Angus K. Maciver, David P. Nowacki, and Kent Wilcox. 8 Table ofContents List ofTables and Figures iv Appointed and Administrative Officials v Report Summary S-1 Chapter I- Introduction and Background 1 Introduction 1 Background Information 1 Professional Licensing in Montana 1 How are Professions and Occupations Regulated? 4 Regulatory Authority ofLicensing Boards 4 Administrative Authority ofthe Department 4 House Joint Resolution 20 5 Audit Approach 6 Audh Does Not Focus on Individual Boards 7 Report Organization 7 Chapter II -Board and Department Organization 9 Introduction 9 Balancing Public and Professional Interests 9 Board Organizational Structure 9 Board Membership Requirements 9 Board MemberTerms 10 Board Meetings 10 Ratio ofPublic to Professional Members 11 Department Organizational Structure 12 Funding Administrative Services 13 Changes in Department Organizational Structure 14 Previous Organizational Structure 14 Problems with Vertical Management Structure 15 Management Reorganization Plans 16 Conceptual Benefits ofNew Organizational Structures 18 Implementation ofManagement Restructuring 1 Updating Policies and Procedures 18 Management Information Reporting 19 Performance Measurement Procedures for Management Reorganization 20 Additional Guidance for Management Reorganization 20 Management Memorandums 21 Overall Conclusion 22 Chapter III -Licensing Fees and Board Finances 23 Introduction 23 Funding Professional Regulation in Montana 23 Statutory Guidance on Fees and Finances 23 HJR 20 Guidance and Audit Objectives 23 Fee Types and Amounts 24 Fee Revenue Comparison 24 Survey Results Relating to Fees 25 Page i Table of Contents Information fromOther States 25 Are Fees Commensurate for Respective ProgramAreas? 26 Variations in Administrative Service Fees 26 Administrative Services Fees are Not CommensurateWith Costs 27 Assigning the Department Responsibihty forAdministrative Fees 27 Cash Balance Limitations 28 Survey Resuhs Relating to Board Funds 28 Findings from Financial Compliance Audit 29 Improvements Needed in Responding to Excess Balances 29 Boards' Responses to Excess Balances 29 Department Should Seek StatutoryAuthority forTemporary Fee Adjustments 30 Department Administrative Costs 30 Survey Results Relating to the Department's Role inBoard Finances 31 How are Administrative Support Costs Calculated? 31 Changes in Cost Calculation Procedures 32 Management Memorandum 32 Overall Conclusion 33 Chapter IV - License Application 34 Introduction 35 HJR20 and Public Protection 35 Pew Commission Report on Professional Regulation 35 Public Protection and Audit Objectives 36 Licensure Process 36 Analysis ofLicense Applications for FY 2002 and FY 2003 36 Survey Results Relating to Licensure Process 37 Timeliness ofLicensure Process 38 Board Review ofApplications 39 Developing Standardized Licensure Procedures 39 Review Requirements in Other States 39 Department Responsibility forApplication Review 40 Education and Experience Requirements 40 Survey Responses Relating to Education and Experience Requirements 40 Licensure Requirements in Other States 42 Reciprocity with Other States 42 Review ofApplicant's StateofOrigin 42 Overall Conclusion 43 Chapter V - License Renewal 45 Introduction 45 Board Renewal Requirements 45 Survey Responses Relating to Renewal Requirements 45 Renewal Requirements in Other States 45 Department Renewal Procedures 46 Page ii Table of Contents Online Renewal 46 Renewal Cycles and Dates 46 Online Renewal is Restricted for Some Licensees 48 Department Should Pursue Standardization ofRenewal Procedures 48 Chapter VI- Compliance and DisciplinaryActivities 51 Introduction 51 Uniform Disciplinary Process 51 Board Sanctions 53 Complaints Data and Statistics 53 Complaints Received 53 Source ofComplaints 54 Complaints Process Timeframes 55 Complaints Outcomes 55 Survey Responses Relating to Disciplinary Process 56 Promoting Uniformity in Disciplinary Activities 57 Consistency in Board Disciplinary Policies 58 Uniform Administrative Rules For Professional Assistance Programs 60 Department Compliance Inspection Procedures 61 Department Complaint Investigation Procedures 63 Overall Conclusion 64 Appendix A - Audit Approach A-1 Audit Scope A-1 Audit Methodologies A-1 Audit Planning A-1 Financial Information A-2 Disciplinary Procedures A-2 Department Administrative Procedures A-2 Board Activities A-2 Review ofOther States A-3 Appendix B - Board Member Survey Response Data B-1 Appendix C - Online Licensee Survey Respsonse Data C-1 Department Response D-1 Department ofLaborand Industry D-3 Page iii List ofTables and Figures Figures Figure 1
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