(a) Notwithstanding any other provision of this code, a board may deny a license regulated by this code on the grounds that the applicant has been convicted of a crime or has been subject to formal discipline only if either of the following conditions are met:

1. (1) The applicant has been convicted of a crime within the preceding seven years from the date of application that is substantially related to the qualifications, functions, or duties of the business or profession for which the application is made, regardless of whether the applicant was incarcerated for that crime, or the applicant has been convicted of a crime that is substantially related to the qualifications, functions, or duties of the business or profession for which the application is made and for which the applicant is presently incarcerated or for which the applicant was released from incarceration within the preceding seven years from the date of application. However, the preceding seven-year limitation shall not apply in either of the following situations:

   1. (A) The applicant was convicted of a serious felony, as defined in Section 1192.7 of the Penal Code or a crime for which registration is required pursuant to paragraph (2) or (3) of subdivision (d) of Section 290 of the Penal Code.

   2. (B) The applicant was convicted of a financial crime currently classified as a felony that is directly and adversely related to the fiduciary qualifications, functions, or duties of the business or profession for which the application is made, pursuant to regulations adopted by the board, and for which the applicant is seeking licensure under any of the following:

      1. (i) Chapter 6 (commencing with Section 6500) of Division 3.
      2. (ii) Chapter 9 (commencing with Section 7000) of Division 3.
      3. (iii) Chapter 11.3 (commencing with Section 7512) of Division 3.
      4. (iv) Licensure as a funeral director or cemetery manager under Chapter 12 (commencing with Section 7600) of Division 3.
      5. (v) Division 4 (commencing with Section 10000).
2. (2) The applicant has been subjected to formal discipline by a licensing board in or outside California within the preceding seven years from the date of application based on professional misconduct that would have been cause for discipline before the board for which the present application is made and that is substantially related to the qualifications, functions, or duties of the business or profession for which the present application is made. However, prior disciplinary action by a licensing board within the preceding seven years shall not be the basis for denial of a license if the basis for that disciplinary action was a conviction that has been dismissed pursuant to Section 1203.4, 1203.4a, 1203.41, 1203.42, or 1203.425 of the Penal Code or a comparable dismissal or expungement. Formal discipline that occurred earlier than seven years preceding the date of application may be grounds for denial of a license only if the formal discipline was for conduct that, if committed in this state by a physician and surgeon licensed pursuant to Chapter 5 (commencing with Section 2000) of Division 2, would have constituted an act of sexual abuse, misconduct, or relations with a patient pursuant to Section 726 or sexual exploitation as defined in subdivision (a) of Section 729.

(f) A board shall follow the following procedures in requesting or acting on an applicant’s criminal history information:

1. (1) A board issuing a license pursuant to Chapter 3 (commencing with Section 5500), Chapter 3.5 (commencing with Section 5615), Chapter 10 (commencing with Section 7301), Chapter 20 (commencing with Section 9800), or Chapter 20.3 (commencing with Section 9880), of Division 3, or Chapter 3 (commencing with Section 19000) or Chapter 3.1 (commencing with Section 19225) of Division 8 may require applicants for licensure under those chapters to disclose criminal conviction history on an application for licensure.
2. (2) Except as provided in paragraph (1), a board shall not require an applicant for licensure to disclose any information or documentation regarding the applicant’s criminal history. However, a board may request mitigating information from an applicant regarding the applicant’s criminal history for purposes of determining substantial relation or demonstrating evidence of rehabilitation, provided that the applicant is informed that disclosure is voluntary and that the applicant’s decision not to disclose any information shall not be a factor in a board’s decision to grant or deny an application for licensure.

3. (3) If a board decides to deny an application for licensure based solely or in part on the applicant’s conviction history, the board shall notify the applicant in writing of all of the following:

   1. (A) The denial or disqualification of licensure.
   2. (B) Any existing procedure the board has for the applicant to challenge the decision or to request reconsideration.
   3. (C) That the applicant has the right to appeal the board’s decision.
   4. (D) The processes for the applicant to request a copy of the applicant’s complete conviction history and question the accuracy or completeness of the record pursuant to Sections 11122 to 11127 of the Penal Code.

(g)

1. (1) For a minimum of three years, each board under this code shall retain application forms and other documents submitted by an applicant, any notice provided to an applicant, all other communications received from and provided to an applicant, and criminal history reports of an applicant.

2. (2) Each board under this code shall retain the number of applications received for each license and the number of applications requiring inquiries regarding criminal history. In addition, each licensing authority shall retain all of the following information:

   1. (A) The number of applicants with a criminal record who received notice of denial or disqualification of licensure.
   2. (B) The number of applicants with a criminal record who provided evidence of mitigation or rehabilitation.
   3. (C) The number of applicants with a criminal record who appealed any denial or disqualification of licensure.
   4. (D) The final disposition and demographic information, consisting of voluntarily provided information on race or gender, of any applicant described in subparagraph (A), (B), or (C).

3. (3)

   1. (A) Each board under this code shall annually make available to the public through the board’s internet website and through a report submitted to the appropriate policy committees of the Legislature deidentified information collected pursuant to this subdivision. Each board shall ensure confidentiality of the individual applicants.
   2. (B) A report pursuant to subparagraph (A) shall be submitted in compliance with Section 9795 of the Government Code.

(i) This section does not in any way modify or otherwise affect the existing authority of the following entities in regard to licensure:

1. (1) The State Athletic Commission.
2. (2) The Bureau for Private Postsecondary Education.
3. (3) The California Horse Racing Board.