(a)  Except as provided in Section 18027.3, and except as provided by the National Manufactured Housing Construction and Safety Standards Act of 1974 (42 U.S.C. Sec. 5401 et seq.), as it applies to the manufacture of new manufactured housing, the department shall enforce this part and the rules and regulations adopted pursuant to this part.

(b)  The department may, at the department’s sole option, enforce Chapter 4 (commencing with Section 18025) and the rules and regulations adopted pursuant to Chapter 4 through department-approved third-party entities. The department shall adopt regulations for the approval of third-party entities, including, but not limited to, all of the following criteria:

(1)  Freedom from any conflict of interest.

(2)  Qualifications of personnel.

(3)  Frequency of inspections or monitorings of manufacturer quality control.

(4)  Involvement in collusive or fraudulent actions related to the performance of activities required by Section 18013.2.

(5)  Any other conditions of operation that the department may reasonably require.

(c)  The department may require rotation of third-party entities performing inspection services for any manufacturing facility within the state to prevent the third-party entity from either performing inspections within the same facility for more than 365 calendar days or performing inspections for any facility when the third-party entity performed inspection services within the previous 365 calendar days.

(d)  The department shall monitor the performance of third-party entities approved pursuant to subdivision (b) and shall require periodic reports in writing containing information that the department may reasonably require to determine compliance with the conditions of the department’s approval.

(1)  When the department receives information about an alleged inadequacy in the performance of a third-party entity, including any involvement in collusive or fraudulent actions related to the performance of activities required by Section 18013.2, it shall consider the information in its monitoring efforts and make a determination about the validity of the alleged inadequacy in a timely manner.

(2)  When the department determines, either through its monitoring efforts or through information provided by any other person, that an approved third-party entity has failed to perform according to the conditions of approval, the department may withdraw approval by forwarding written notice to the approved third-party entity by registered mail to its address of record, briefly summarizing the cause for the department’s decision.

(3)  A third-party entity, upon having its approval withdrawn by the department, may request a hearing before the director of the department. The request for hearing shall be in writing and either delivered or postmarked prior to midnight on the 10th calendar day from the date of the department’s notice.

(4)  The department, upon timely receipt of a written request for hearing, shall, within 30 calendar days, schedule a hearing before the director or his or her agent. All hearings pursuant to this subdivision shall be held in the department’s Sacramento offices and the decision of the director shall be final.

(5)  A third-party entity whose approval has been withdrawn by the department shall not be permitted to reapply for the department’s approval pursuant to subdivision (b) for a period of one year from the date that the approval was withdrawn by the department.

(6)  A third-party entity whose approval has been withdrawn more than once by the department shall not be permitted to reapply for department approval pursuant to subdivision (b) for a period of not less than one year from the date that the department’s approval was last withdrawn.

(7)  No third-party entity shall perform the activities required by Section 18013.2 unless it has the approval of the department.

(e)  (1)  Upon finding a violation of subdivision (b) on the part of a third-party entity, the director shall issue citations and levy administrative fines. Each citation and fine assessment shall be in writing and describe the particulars for the citation. The citation and fine assessment shall be issued not later than six months after discovery of the violation.

(2)  The fine for a first violation shall be at least five hundred dollars ($500) and shall not exceed one thousand dollars ($1,000). The fine for a second violation shall be at least two thousand dollars ($2,000) and shall not exceed four thousand dollars ($4,000). The fine for a third violation shall be at least five thousand dollars ($5,000), and shall not exceed ten thousand dollars ($10,000). The fines shall be assessed for each day the violation occurs. If a third-party entity has been cited more than three times during a 365-day period, the approval to conduct inspections on behalf of the department shall be suspended for a minimum of one year.

(3)  The third-party entity may request an administrative hearing on the citation or fine. If the party fails to request a hearing within 30 days and does not pay the fine, the approval to perform inspections shall be automatically revoked, until the time that the department finds that the circumstances that led to the citation have been corrected and the fines have been paid.

(4)  Upon review of the findings from the administrative hearing, the director may modify, rescind, or uphold the citation and fine assessment. The decision of the director shall be served by regular mail.

(5)  The fines shall be paid into the Housing and Community Development Fund, which is hereby created in the State Treasury, and shall be used, when appropriated by the Legislature, to offset the department’s costs to administer this part.

(f)  The remedies provided in this part to any aggrieved party are not exclusive and shall not preclude the applicability of any other provision of law.

(Amended by Stats. 1999, Ch. 83, Sec. 107. Effective January 1, 2000.)