Administration proposes separate Business and Consumer Services agency to sharpen consumer protection and licensing oversight

Secretary Tamika Moss told an Assembly joint informational hearing May 20 that the governor's 2025 reorganization plan would split the Business, Consumer Services and Housing agency into two new entities and create a standalone agency focused on business and consumer services.

The reorganization plan, Moss said, would allow licensing and consumer-protection functions to receive dedicated leadership and “a laser focus” on licensing, enforcement and modernization of technology and processes. "This proposal emerges from that commitment and lays the groundwork for lasting and meaningful change," Moss said.

Why it matters: supporters said a dedicated Business and Consumer Services Agency would let departments that license and regulate visible industries respond faster to market change, modernize application and renewal systems, and strengthen enforcement. Opponents and some legislators pressed officials for clarity about timing, budget impacts and whether licensees would face higher fees.

Secretary Moss said the Business Consumer Services Agency would "come online next July" and later officials described a phased implementation; agency leaders told the committee they aimed to avoid imposing new fees on licensees. "We do not anticipate any of our departments raising fees as a result of this reorganization," Moss said when asked about fee impacts. The Department of Consumer Affairs' director Kimberly Kirkmire told the committee the department "is in full support of the reorganization proposal" and listed recent modernization steps including hybrid meeting participation, an "enlightened license" report and expanded online services.

Departments represented in the first panel included the Department of Consumer Affairs, Department of Cannabis Control, Department of Financial Protection and Innovation (DFPI) and the Department of Alcoholic Beverage Control. Nicole Elliott, director of the Department of Cannabis Control, said removing housing responsibilities from consumer-regulation work would reduce competing priorities in cannabis oversight and consumer protection. DFPI Commissioner Casey Mosseini described the agency as a good fit for his department following the DFPI's recent transformation.

Legislative concerns: several lawmakers focused on timing and costs. Assemblymember Quirk-Silva and others said the May revise and the Legislature's June 15 budget deadline mean the administration's schedule leaves little time for budgetary review. Moss said the reorganization will appear in the May revise and that the Little Hoover Commission has been hearing testimony; she said the commission would provide a recommendation within about 20 days and the Legislature would have its statutory 60 days to review the plan.

Officials also addressed office-space and staffing concerns prompted by statewide return-to-office guidance, saying they do not anticipate new space costs and plan to keep related programs co‑located where feasible. Moss said the administration expects to be "thoughtful about our space constraints" and that housing staff who currently work together will be kept together where possible.

Public comment on the consumer-protection panel was uniformly supportive from regulated industry associations. Representatives from the California Beer and Beverage Distributors Association, California Craft Brewers Association, Wine Institute and other trade groups told the committee they supported the reorganization.

What was not decided: there were no formal votes at this hearing; the committee heard testimony and public comment. The administration acknowledged some implementation details will depend on budget action and further planning.

Looking ahead: the administration said it will use the remainder of the statutory review period to refine the fiscal analysis and operational details and to consult with stakeholders on change-management steps. Committee members said they will continue oversight as the plan proceeds through the May revise and formal review period.