Senate Standing Committee on Labor, Public Employment and Retirement

Senator Durazo isn't here to even start presenting her bill, so. We do have a quorom. No, we don't. Yeah, we do.

Maybe Senator Laird will get to go first. I don't have a problem with that. Yeah, I mean, we could just ...

The Senate Committee on Labor, Public Employment and Retirement will come to order. Good morning. The Senate continues to welcome the public in person, but also through the teleconference service. So that will be happening today. And for individuals wishing to provide public comment today, that participant number is 877-226-8163. Again, public comment can happen here, but if you want to call in and you're listening now, that number is 877-226-8163. There's an access code you need to use, which is 694-8930. I'll repeat that.

694-8930. For this hearing only, meaning don't plan on this happening the next Committee meeting. But for today, we're allowing up to three lead witnesses for support and opposition. So there'll be a total of six minutes for each side. Normally, we would be holding to four minutes to each side. So six minutes today for the lead witnesses. Each lead witness that is part of a trio is welcome to speak for two minutes.

For bills with only one or two lead witnesses, we ask that your testimony be kept to three minutes per individual. So following the math there, that still would then add up to a six minute maximum. All others wishing to testify must limit their comments to their name, affiliation, and position on the measures. Testimony taken via the teleconference service will be limited to a total of 20 minutes. And what we're doing this session is taking support and opposition together on that teleconference line.

As everyone in the building today knows, we're holding these Committee hearings here in the O Street building. I want to ask all Members who are not here to please be present now in this room, 2200, so we can establish our quorum and begin our hearing. I'm told we may have enough Members for a quorum. Now, let me just say before we establish it that we have 18 bills on today's agenda. So we will talk about those a little bit more momentarily. But before we do that, let's establish a quorum. And assistant, if you could please call the role.

Cortese. Here. Wilk. Durazo. Here. Laird. Here. Senator Smallwood-Cuevas. Here. We have a quorum.

All right, so the assistant has noted that a quorum has been established. We're going to move now to consent calendar. I'd like to entertain a motion on consent items, which are SB 332, SB 335, SB 510 and SB 716. Senator Laird has moved consent. Consultant, would you please call the roll?

File items number 6, 10, 13 and 15, all on consent. Cortese. Aye. Wilk. Durazo. Aye. Laird. Aye. Smallwood-Cuevas. Aye. That bill is on call. Those bills.

Great. Thank you. Those bills will be kept open. The roll will be kept open on call. As we get additional Committee Members here today, we will take up the consent one more time. Now, we're going to move to what is the ordinary file order today, and the number one bill on the file is Senator Durazo's bill having to do with minimum wage and healthcare workers. So we know there's lots of interest in the bill. And Senator Durazo. Yeah, if you could please proceed to the podium and present as soon as you're ready, we would appreciate that.

Thank you, Mr. Chair and Members. Good morning. First, I want to thank the Committee staff for their analysis, and we'll begin by accepting the recommended Committee amendment on page 10. Clarifies that this bill does not include delivery work on the premises of a covered healthcare facility.

If that delivery worker is not an employee of any person that owns, controls, or operates a covered healthcare facility. I am very proud to present SB 525, which will establish a $25 per hour minimum wage for all healthcare workers who provide services that directly or indirectly support patient care. Raising the minimum wage for all healthcare workers in the state is critical in order to help retain staff. Prior to the pandemic, California was already facing a shortage of 500,000 healthcare workers.

Now, after facing the trauma and dangerous working conditions throughout the pandemic, many workers, many men and women, are struggling with low pay and poor working conditions. In fact, 31% of healthcare workers report they are considering leaving the profession. The impacts of the staffing crisis are being felt by healthcare workers and those that they care for.

We have heard from healthcare workers, such as medical assistants, clerical and cooks, who are making less than $25 per hour, and they are struggling to make ends meet--like just to pay the rent or to pay for the gasoline in their cars, they have had to take on two or three jobs and do not have time to take care of themselves while they were taking care of others, their patients.

We have also heard from workers that are in facilities where one person is doing the job of several people: answering phones, putting patients in the rooms, getting referrals. The tasks go on and on and on. This demonstrates how shortages are impacting both access to care and the quality of care for people in our state. In addition, people of color and women make up the majority of our state's healthcare workforce, which means they bear the brunt of the low wages and the understaffed healthcare facilities.

This is why we need SB 525. It begins to address the systemic undervaluing of care work. It elevates majority women workforce out of poverty. Higher wages will help restore healthcare jobs to the status of a job in which a person can support a family. It will also attract more workers to fill the huge shortage of healthcare workers our state is facing. We know medical facilities are struggling to recruit and retain employees.

Many clinics, hospitals and other healthcare facilities are competing with sectors like retail, food services and hospitality for entry level, hourly paid workers. We've heard from opposition saying they can't afford to pay their workers higher wages. And although we recognize the physical constraints on some facilities, the truth is: we will never stabilize health care for underserved communities as long as low wages and understaffing are causing the hemorrhaging of critical workers at our clinics and hospitals.

Hospitals and other healthcare facilities need to invest in their workforce in order to ensure that services are not cut and access to care is not impacted. Hospitals, clinics and similar medical facilities cannot run their day to day operations without addressing the needs of their workforce. I have spent my entire life fighting to raise wages for working people, hotel housekeepers, janitors, laborers, teachers and nurses. Poverty wages hurt everyone. SB 525 will raise wages for healthcare workers by establishing a $25 per hour minimum wage.

Today, I have two healthcare workers with me, Mayisha Chavis, medical assistant at St. Francis in Lynwood, and Katie Templeton, a medical biller at the Los Angeles LGBTQ Center, and Matt Lege, on behalf of SEIU California, the sponsors of this bill. Thank you, Mr. Chair.

Hi.

Sorry about the microphone. We will go to the lead witnesses now, and you may begin. Just a reminder, which I'll be doing all through the day. Three minutes per lead witness for a total of-

There's three of them. It'll be two minutes per.

Two minutes per lead witness. Our total is six minutes, so that's a more correct division. I apologize, but please proceed if you're ready. Thank you.

Hi, good morning. My name is Mayisha Chavis. I'm a medical assistant at St. Francis in Lynwood. I've been working with St. Francis for about two and a half years. I started as a Covid screener at the emergency department, and I noticed it was ... because short staff. I noticed that it wasn't a lot of workers. It was a point to where the patient wasn't able to get proper care because it's due to short staff.

I've seen how the workers was overcrowded with a lot of work. I've seen that a patient was being laid back with not being able to be seen properly due to the short staff. The EVS that take care of the cleaning and stuff, a lot of restroom wasn't being cleaned due to understaff. Restroom on floors wasn't being cleaned properly. So I just wish that by the minimum wage being $25, it will help with people coming in and assisting us at the healthcare fair.

I work front and back office at the ortho clinic and sometimes it's kind of hard for us to even do our work because we don't have any help at the ortho clinic. And I love my job. I love my job. I don't want to leave. I stayed at St. Francis because I'm dedicated to my patient and the work ethic as well. I'm a single mother of two.

I was recently homeless with my two kids, but thankfully I have found a place for me and my kids. But it's been hard, because I'm making $17 where I can't afford the bills, where I can't even buy diapers and clothes for my kids because my rent is extremely higher than what I'm bringing home. So I will really hope and pray that you guys will help us because it's really hard, because I don't want to leave my job. Because if I leave my job, I'm not going to be able to take care of my kids. But it's kind of hard because I'm not the only one that's going through this. A lot of people that's suffering as well that been trying to hold on and have the--I'm nervous.

You're doing great, but you do have to wrap up because you're just going over the two minutes now.

So I just want to say, I just hope you guys really put yourself in our shoes and say, "Are you able to live off of $16, $17 where you don't have to worry about your lights being shut off, your gas being cut off, or being homeless?" So I really just hope you guys really would think about it and really take this into consideration. To really give this to the healthcare workers, and maybe we'll be able to help the healthcare field again by having people come into our facility and help everybody. Thank you.

All right, thank you. Next lead support witness, please. If you can come forward and identify yourself and you can proceed for a couple of minutes.

Hello, Chair Cortese and Members of the Committee. Thank you for the opportunity to speak about State Bill 525. My name is Katie Templeton. I'm a medical biller for the LA LGBT Center, which provides social and health services for the LGBT community. I've worked there for seven years, this past April, or this April. So when I started, I was homeless for a period, and having a job and being homeless is a whole another set of problems.

But because of the negotiating that we did in 2016 with my coworkers for our contract, I was able to pull myself out of homelessness because of a pay raise that our contract allowed. I make about $23 an hour thanks to our union contract. But skyrocketing cost of living, particularly the astronomical rent sizes, still means I'm just scraping by.

Food is increasing, and as well as my electricity bills, especially for this winter that we've had this past year--it's much tougher for other workers at the LGBT Center, where starting wages range from $15 an hour, and that's just not livable in Los Angeles at all. It's impossible to live on that. I have coworkers forced to work 1, 2 other, 3, not only 5-8 hour jobs, but side gigs that they do on their own time.

This is why so many workers in clinics like ours and in the healthcare field in general are moving on to other careers. We can't afford to feed our families. We can't afford to feed ourselves. And if we can't afford to take care of our own matters, we can't help take care of anybody else's. This is a vicious cycle. Too many workers can't even make enough to live. They quit and take higher paying jobs outside of health care. The remaining workers have to pick up the slack in a short staff clinic. My predecessor mentioned this very specifically. And then we get burnt out-

You'll have to wrap up. You're at the two minute mark.

Okay. Like I said, I'm a medical biller in an FQHC. We deal with low-income individuals. I help clients with insurance, specifically Medi-Cal, which is vital for survival in this world. My job is to advocate including those with private insurances. Right from the get-go insurance companies just don't want to pay.

Thank you for your testimony. I have to be fair to both sides. Otherwise, if we go three or four minutes-

I totally understand.

The opposition gets-

Please vote for the bill. Thank you.

Lead support witness, please come forward.

Thank you, Chair and Members. Matt Lege on behalf of SEIU. I happily defer my time to the other lead witnesses. But I'll just quickly--and appreciate the Committee's willingness to hear this bill first and appreciate your staff as well, who's done some great work on both the analysis and working with us on the bill. Would like to thank Senator Durazo, her staff, and of course, Senator Smallwood-Cuevas, who's also a co-author of this bill, for taking on this righteous effort.

I do want to just make a couple of quick points. The healthcare industry received significant support during the pandemic in terms of state and federal support. Operational revenues are starting to return to pre-pandemic levels, while workers continue to struggle with making ends meet. We have seen the combined net income for hospitals and health systems, large hospitals and health care systems in California from 2020 to 2022 was $38 billion in net revenue. Significant resources from the Kaiser Health Foundation.

We are seeing for profit health systems starting to have operational margins that meet or exceed pre-pandemic levels. Unfortunately, during the pandemic, we saw the majority of workforce investment with temporary staff versus investing in workforce and long term solutions.

And I do want to just quickly highlight the UC Berkeley report, which came out yesterday, that highlighted that this would have a direct impact on 469,000 workers, that this would be a primary benefit for workers of color, which represent 70% of the impacted workers and women, who make up three-fourths of the impacted worker. The 70% of the workers impacted have at least some college, close to half have children, one-quarter of the workers are below the 200% of the poverty line.

Really, we have found that increasing pay for workers and addressing retention will improve patient outcomes, including shorter hospital stays and decrease in infection and lower mortality rates. The healthcare industry is really at a crossroads right now in terms of if they're going to continue to rely on low-wage workers and delivering care to low-wage workers, or are we going to choose to invest in our workforce and ensure that workers, when we're taking care of our most vulnerable patient, every worker earns a living wage. Thank you very much.

Thank you for your testimony. Now, if there's anyone else in the Committee room who wishes to express a support position, you could come forward now. Step forward, say your name, any affiliation that you have and support. Please don't come up one at a time. If you can just queue up. If we have more than one person, just get in a single file line and this goes pretty quickly. Please proceed. Name, affiliation and support.

My name is Adam Kosak. I'm a pharmacy tech at Kaiser hospitals. I am in support.

Thank you.

My name is Candina Aralo. I'm a nurse at Kaiser, and I'm in support.

All right, thank you. No one else?

Hello, everyone. Good morning. My name is Lanette Griffin, South Sacramento, Kaiser, 30-year employee, proud member of SEIU, and I urge you to support this bill.

Thank you.

My name is Amanda Aikawa. I'm a registered nurse at Sutter Amador Hospital in Jackson, California, and a member of SEIU-UHW, and I'm in support.

Thank you.

Hi. I'm an ER technician at Kaiser Sacramento, and I am in support.

Thank you.

My name is Alisha Walker. I'm a clinical coordinator at Lifelong Medical in Oakland, California, and I am in support of SB 525.

Thank you.

Hi. My name is Jessie Coker, and I work for Lifelong Medical Group, and I am in support as well. Thank you.

Thank you.

My name is Jennifer Pruitt. I'm with Kaiser Permanente. I'm a pharmacy technician, with them for 25 years, and I support.

Thank you.

My name is Sabrina Howes. I'm a Kaiser member medical assistant at Sacramento, and I support.

Thank you.

Hello. My name is Sherry Cooper. I work in the laboratory, and I'm in support of the bill as well. Thank you.

Thank you.

Hello. My name is Mabel ... I work for Lifelong. I'm a behavioral health community health worker, and I am in support of the bill.

Thank you.

Hi. My name is Christina Greenway. I'm a certified ophthalmic technician in the Ophthalmology Department of Kaiser in Sacramento, and I'm in support.

Thank you.

Hello. My name is Sonia ... and I am a certified ophthalmic assistant in Folsom in ophthalmology and eye services, and I'm in support.

Thank you.

Hi. My name is McDahlia ... I'm a patient care coordinator and eligibility specialist. I work for Lifelong Urgent Care in the City of San Pablo. I'm an SEIU-UHW member, and I'm speaking in supporting the SB 525.

Thank you.

My name is Fabunmi Adefunmi-Sands. I'm an emergency room ed tech at Kaiser Morris ed, as well as a ... instructor and I'm in support of the bill.

Thank you.

My name is Mauricio Medina. I work at Southern California of Hollywood. I am a 22 year employee in the healthcare. I am a CNA monitor tech/ ... secretary.

Thank you.

And I support.

Hi, my name is Jessica Sanchez. I'm a nurse here in Sacramento and also a correctional nurse. I've been working at Kaiser SEIU-UHW for about eight years, and I support. Thank you.

Thank you.

Good morning. My name is Joseph Brown. I'm an interventional radiology tech at Sutter Roseville and a proud member of SEIU-UHW. And I strongly urge you to support this bill. Thank you.

Thank you.

Good morning. My name is India Prasad. I'm a medical assistant at Roseville Kaiser, and I support this bill.

Thank you.

Good morning. My name is Juan Carlos Rodriguez De La Cruz. I'm an emergency department technician at Sutter Roseville, and I'm in support of this bill.

Thank you.

Good morning. My name is Georgette Bradford. I am an ultrasound technologist at Kaiser Permanente Sacramento, a proud member of SEIU-UHW, and I strongly urge you each to support SB 525. Thank you.

Thank you.

Hello. My name is Elena Teresa ... I am representing SEIU-UHW for Stanford Healthcare and Lucile Packard Children's Hospital. And I strongly support this bill and urge you to.

Thank you.

Good morning. My name is Marquetta Willingham. I am a surgical first assist with Kaiser Permanente. I strongly urge you to support SB 525. I come from a family of eight 100% women who are healthcare workers, nurse practitioners, pharmacists, pharmacy techs and other healthcare workers, so I strongly agree.

Thank you.

Good morning. My name is Tammy Chu and I am a senior health plan representative. And I strongly support SB 525.

Thank you.

Good morning. My name is Melissa Jackson, and I'm a MA LVN at Kaiser. And I strongly support and urge you to support as well, this bill. Thank you.

Thank you.

Good morning. I'm Anthony Cox. I'm a SNA at Sutter Roseville, and I'm in support.

Thank you.

Good morning. I'm Gabriella. I'm a respiratory therapist at Kaiser, and I support this bill.

Thank you.

Good morning. My name is Desiree Fickner, and I am a pharmacy technician at Kaiser for 25 years, and I am in support.

Thank you.

Good morning. My name is Juan ... I'm SEIU UHW from Roseville. Thank you.

Thank you.

My name is Sarah Frosto. I am a medical assistant at Roseville Kaiser. I do support the bill.

Thank you.

My name is Yolanda Moon. I am a medical assistant in Roseville. I'm a SEIU-UHW member, and I support Bill 525.

Thank you.

Hello. My name is Irene Hernandez, and I am a department clerk at Kaiser Roseville Home Health, and I support SB 525.

Thank you.

Hi. My name is Liz Grigsby. I'm a respiratory therapist at Kaiser Roseville, and I support SB 525.

Thank you.

Hi. My name is Stacey Kearney. I'm a patient financial advisor at Kaiser Roseville and a member of SEIU-UHW, and I support the SB 525.

Thank you.

Good morning. My name is Ja'nice Wisdom. I'm a staff assistant at Kaiser Roseville and a member of SEIU-UHW, and I urge you to support SB 525.

Thank you.

My name is Lydia Cabral. I am a proud member of SEIU 721, and I work at LAC USC Medical Center. And I urge you and encourage you to vote on SB 525. Thank you.

Thank you.

Good morning. My name is Maria Tenorio. I'm a community health worker for the Department of Health in LA County. I urge that you support SB 525, and stop sending money to Ukraine. Help our health workers.

... Buenos días. Good morning, everybody. My name is ... Shunkash. I'm working with the Clinica Oscar Romero in LA, Los Angeles, California. I come because I want to support the SB 525. Because it's not just to leave the people-

That's all you can say, ma'am. Thank you.

With the low salary.

Thank you. Thank you. Appreciate all the testimony. You're doing well.

Hi. My name is Donna Velasquez. I'm a medical assistant for Ventura County, and I'm an SEIU 721, and we really want you guys to support SB 525.

Thank you.

My name is Rene Espinoza. I'm a nursing assistant at Ventura County Medical Center, the ... Ventura, and a member of SEIU 721. Please support SB 525. Thank you.

Thank you.

My name is Martin Espinoza. I'm a nursing assistant at Ventura County Medical Center. I'm asking to please support SB 525. Thank you.

Thank you.

Hello, good morning. My name is Xavier Puente. I work for LA County Department of Mental Health. I'm a community health worker, and I'm here in support of SB 525. Thank you so much.

Thank you.

Good morning. My name is Dr. Kelley Butler. I'm a resident physician in family medicine at UCSF. I'm here on behalf of the Committee of Interns and Residents, and I hope for your support on Senate Bill 525.

Thank you.

Hello. I'm Dr. Manveer Singh Dilts-Garcha. I'm a neurologist and epilepsy fellow at Stanford. I'm a member of CIR, and I'm here asking for your support on SB 525. Thank you.

Thank you.

Hello. My name is Dr. Natalie Eggleston. I'm a fourth-year resident physician at Valley Medical Center in San Jose, California. I'm here with CIR, and I ask for your support on Senate Bill 525. Thank you.

Thank you.

Hello. Good morning. I'm Dr. Hilary Rogers. I'm also an OBGYN resident physician coming from Santa Clara Valley Medical Center in San Jose. I'm here with CIR, and I'm speaking in support of SB 525. Thank you.

Thank you.

Hello. My name is Carla Martinez and I'm a medical assistant at Omni Family Health in Wasco. And I'm here speaking on the support of the SB 525. Thank you.

Thank you.

Good morning. My name is ... Danieto, and I work as a medical assistant at the Ventura County Oxnard Clinicas del Camino Real, and I'm here to support the SB 525.

Thank you.

Good morning. My name is Tina Diep. I'm a community health advocate. I work in Asian Health Services in Oakland City. I'm a 1021 member. I'm here to support 525. Thank you.

Thank you.

Good morning. My name is Angel Valdez. I work as a layout graphic designer, La Clínica de La Raza in Oakland, and I'm a proud Local 1021 member. And I'm here speaking in support of SB 525. Thank you.

Thank you.

Good morning. My name is Steve K. Valenciano. I'm a child and family mental health therapist at Kedren Community Health Clinic in Los Angeles, California, and a Member of SEIU Local 721. I am here in support of SB 525.

Thank you.

Hello. I'm Raymond Meyer. I'm a cook at Mercy McMahon Terrace. I'm here to support pulling healthcare workers out of poverty, and I support SB 525.

Thank you.

Hello. My name is ... Sanchez ... I'm a food service worker at Kern Medical, Bakersfield. I'm a member of SEIU Local 521. I'm here to speak on behalf of SB 525, ... workers united.

Thank you.

Good morning. My name is Angela Milan. I am your dental scheduler at Golden Valley in Atwater. I am here to support the SB 525 for my workers.

Thank you.

Good morning. My name is Jasmine Gonzalez Blue, and I work for WellSpace Health, Sacramento. And I'm here to support the SB 525.

Thank you.

My name is Christopher Jones. I'm a registered nurse with Riverside University Health Systems in Riverside County. I'm here with Local 721. Urge you guys to support SB 525.

Thank you.

Good morning. My name is Maria Martinez Onofre. I'm a referral specialist with Salud Para La Gente in Watsonville. I am here with Local SEIU 521. And I'm here speaking on behalf of SB 525. Thank you.

Thank you.

My name is Bruce Campbell. I'm a clinical laboratory scientist. I work in Riverside County at Riverside University Health System, and our healthcare force really urges you and need you to support this bill, SB 525. Thank you.

Thank you.

Good morning. My name is Yeon Park. I'm with SEIU 1021, and I'm also a behavioral health clinician providing mental health services in Alameda County. I'm rise up here in speaking in support of SB 525. Thank you.

Thank you.

Good morning. My name is Sarah Medina. I work at San Ysidro Health Centers, and I would strongly suggest for you guys to support the SB 525. It's very important for us to make a minimum wage of at least $25 an hour living in California.

Thank you.

Appreciate your time. Thank you.

Hello. My name is Tina Tapia, and I am an admin assistant for the Public Health Department of Alameda County in Oakland. And I'm a member of SEIU 1021 in here speaking to support SB 525. Thank you.

Thank you.

Good morning. My name is Rhonda Caplacios, and I'm an eligibility specialist at Highland Hospital in Oakland, and I'm a Member of SEIU 1021 local. I'm here speaking on support of SB 525. Thank you.

Thank you.

Good morning. My name is Cynthia Landry, and I'm a frontline social worker working with the safety net population. And I work for Alameda County Social Services, Oakland. And I'm a Member of SEIU Local 1021, and I'm here to support Senate Bill 525. Thank you.

Thank you.

Good morning. I'm Brandon Dawkins. I am a health worker for the San Francisco Department of Public Health. I am also a member of SEIU Local 1021, and I, too, also support SB 525. Thank you.

Thank you.

Good morning. My name is Janet Paul. I work for the Los Angeles County Department of Public Health in Division of HIV and STD Program. I'm an intermediate typist clerk. I'm with Local 721, and I am speaking in support of SB 525.

Thank you.

My name is Paul Von Cheech. I am a case manager with Venice Community Housing. I'm also a member of Local 721. I'm here speaking, voicing my support for 521 or 525. Sorry.

Thank you.

Hi, good morning. My name is Valerie Peoples. I work for Watts Healthcare center in South Central LA, known as Watts. I'm here to support bill 525. Thank you.

Thank you.

Thank you.

Good morning, everyone. My name is Deborah Barrios. I'm a med surgical nurse at Zuckerberg San Francisco General. I'm a member of SEIU 1021, and I'm here speaking in support of SB 525. Thank you for your time.

Thank you.

Hello, good morning. My name is Taylor Evans. I work at Westview Healthcare Center in Auburn, California, and I am strongly encouraging to move forward with the Bill SB 525.

Thank you.

Hello, good morning to everyone. My name is Jesus Figueroa Casio. I'm an SAIU 2015. And I work in Westview Healthcare in Auburn. So I strongly let everyone to pass SB 525. Thank you very much. Living in California is high.

Thank you.

Hello. My name is Alex Stewart. I work for San Joaquin County HSA as a social worker. I'm here to let you know that all workers in California behind this bill, please pass it. Thank you.

Thank you.

Hi. My name is Randy Lee, and I work for Vale in Richmond. And I am a member of Local SEIU 2015. And I urge you to pass SB 525

Thank you.

Hi. My name is Sherry Williams. I work at Auburn Oaks in the City of Auburn. I'm an SEIU 2015 member. I'm urging you to support SB 525.

Thank you.

Good morning, everyone. My name is Marjorie Axelrod. I work at Roseville Point Health and Wellness Center in the City of Roosevelt. I am a member of SEIU Local 2015. I'm here respectfully urging you to support SB 525. Thank you.

Hi. My name is Kristen Mozak. I work at the Pines at Placerville Healthcare in the City of Placerville. I'm a member of SEIU Local 2015. I'm urging you to support SB 525. Thank you.

Thank you.

Good morning, everyone. My name is Jesse Sutton. I work at Placerville Pines and my facility is in the City of Placerville. And I'm a member of SEIU 2015. And I urge you support five. SB 525. Thank you.

Thank you.

Good morning. My name is Sandy Kay. I represent all healthcare workers. I'm a proud member of Local SEIU 2015. And I urge you to support SB 525, please.

Thank you.

Good morning. My name is Miria Holder. I work at the Watts Health Center in Los Angeles. I worked there for 30 years. I am utilization management specialist. I am here to ask for your support with the bill SB 525. Thank you.

Thank you.

My name is Lena Reda. We are patient. I need more people care for us and support SB 525.

Thank you.

My name is Sharon Brooks Boyd. As a retiree of Stanford hospital and a patient that access the health system, please support Senate Bill 525.

Thank you.

Good morning. My name is Lynn Ramos. I am a licensed vocational nurse at Tiburcio Vasquez Health Center in San Leandro, and I support SB 525.

Thank you.

My name is Azra Federal Cario. I am a consumer relations coordinator for Northeast Valley Health Corporation. I urge you to support SB 525.

Thank you.

Good morning. My name is Julia Lostane. I work at St. Joseph Stockton, and I urge you to support SB 525.

Thank you.

Hello. Marcus Wilson. UHW. Here to support the Bill. $25 minimum. Thank you.

Thank you.

Hello. My name is Lakeisha Gantz. I work with Families Together of Orange County in the City of Tufton, and I strongly support SB 525.

Thank you.

Hi, good morning. My name is John. I'm a massage therapist out of Santa Ana, California and I'm in support of SB 525.

Thank you.

Hi. Good morning. My name is Omar. I work at St. John's Community Health, and I come from LA, and we're here. Well, actually, my title is medical records department, and I'm here to support SB 525.

Thank you.

Hello. My name is Asher Lopez, and I'm a medical assistant at St. John's Community Health. And we're in LA, and I'm here to support SB 525.

Thank you.

Hi. My name is Carmen Scott. I'm a registered dental assistant. I'm at St. John's Community Health, and I'm a member of the SEIU 721. And I'm here to support the SB 525. Thank you.

Thank you.

Good morning. My name is Anna Amesqua. I'm a PRW at Harbor-UCLA hospital, working at the emergency room, and I'm here to support my union. Thank you.

Thank you.

Good morning. My name is Maria Marquez. I work for Sacramento Community Clinic. I am a medical assistant, and I am supporting this bill. Thank you. You have a nice day, ladies and gentlemen.

Thank you.

Hello. My name is Sonia Rosa. I'm a medical assistant at Benevolence Health Center, and I'm here to support SB 525. Thank you.

Thank you.

Mr. Chair and members. Sarah Flocks, California Labor Federation, here in. Support of raising the minimum wage for healthcare workers, and also in support of finding a path to address the issues raised by the California Nurses Association. Thank you.

Thank you.

Thank you, Mr. Chair and members, Louis Costa, with the Sheet Metal, Air, Rail, and Transportation Workers, SMART Transportation Division in support.

Thank you.

Hi. My name is Destiny Parks. I'm a healthcare worker and MA at Benevolence Health center, and I support this bill.

Thank you. All right. Not seeing anyone else come forward to speak in the committee room. Or maybe we do have. Are these support witnesses? No. All right, we're now going to call lead opposition. Do we have lead opposition witnesses today? If so, please come forward and self-identify.

If there's two of you, you'll have up to 3 minutes each or 6 minutes total. And if there's three of you, it's 2 minutes each. 6 minutes total, please.

I believe there's three of us.

Three? Okay, 2 minutes each. 6 minutes total, please. Thank you.

Wonderful. Thank you. Good morning, Mr. Chair and Committee Members. I'm Diane Hansen, President and CEO for Palomar Health in the San Diego region. We are the largest public healthcare district in the state, entrusted to care for more than half a million residents.

Within our district boundaries, we operate two hospitals, local clinics, nursing homes, and a rehabilitation institute. We fill a critical safety net role in the communities we serve, caring for all people, including the uninsured, low income patients, and other marginalized groups.

Palomar Health must oppose SB 525 because it would jeopardize our ability to ensure we can continue to deliver the care that our community desperately needs. I am deeply concerned this bill will increase healthcare costs, reduce access to medical services, and diminish healthcare employment opportunities.

In the aftermath of the Covid-19 pandemic, hospitals are hurting. Under state direction, we canceled all elective surgeries and suspended many outpatient services to create additional space for an expected increase in Covid-19 patients.

The impact of this was a 60% reduction in patient volume and revenue. Sadly, we even had to furlough employees. If Palomar health were subject to the top down wage increase in SB 525, it would be a financial hit of $60 to $80 million annually, further threatening our viability.

In order to keep the doors open, we would have no choice but to reduce services and even shut down programs, which would not only hurt patients, but also our valued workforce. SB 525 puts lives at risk. I respectfully urge you to vote no.

Thank you. Next witness, please.

Good morning, honorable chair and members. My name is Carol Picard, and I have spent the last 31 years serving older Americans. I am the Director of operations for ACC Senior Services, which was originally founded in 1972 as the Japanese Community center of Sacramento Valley.

The seeds of ACC were planted by two young Asian activists in the late 60s who were empowered by the Civil Rights Movement of 1964, emboldened by the Vietnam War protests, and deeply concerned about the welfare of Asians, specifically nonenglish speaking immigrants.

Today, we have 300 employees and 500 very dedicated volunteers. We have the Meals on Wheels program for Sacramento.

We have a community center with dozens of weekly classes, senior transportation, escort programs, senior employment placement, and three senior living communities, one of which is a skilled nursing facility whose goal was and continues to be, to serve primarily those on Medical.

While I feel the intent of SB 525 is quite honorable, I'm here to voice opposition because it focuses solely on wages.

ACC senior services offers medical, dental, vision. We pay more so that our employees can have premiums that are affordable. We have a 403 B PTO tuition reimbursement and longevity bonuses.

While healthcare workers absolutely deserve to be fairly compensated, this bill does not provide the necessary reimbursement that we would need to do it. I encourage you to continue to evaluate ways whereby we can honor the caregivers in California and provide them better wages. But this bill is not the answer.

Those of us who are nonprofits and who strive to serve the underserved can face some tough decisions. Do we cut back on employees? Do we cut back on benefits? Do we cut back on Medicare and Medical residents?

Or do we just simply close our doors because we won't be financially viable anymore? Therefore, on behalf of ACC Senior Services, we respectfully request your no vote.

All right. Thank you. I understand there's one more opposition lead witness, or did I misunderstand that? I think the first witness said there will be three. If not, we will proceed with opposition in the room that is not lead witnesses. You saw how this went before. And I know some of you are familiar, right? Name, affiliation? And if you're opposed, say opposed.

Okay. Good morning, chair members of the committee. Ronnie Rodigo, on behalf of the California Hospital Association, in respectful opposition to the bill. Thank you.

Thank you.

Thank you. Chair and members. Sarah Bridge, on behalf of the Association of California Healthcare Districts, here with respectful opposition.

Thank you.

Good morning, Mr. Chair and members. Connie Delgado, on behalf of the District Hospital Leadership Forum, in opposition.

Thank you.

Good morning, Mr. Chair and members. Darby Kernan, on behalf of Leading Age California, in respectful opposition.

Thank you.

Good morning, Chair and members. Colin Hawling, behalf of Health Center Partners of Southern California, regretfully, in opposition, unless amended. Thank you very much.

Thank you.

Good morning. Chair and members. Jim Thering, CEO, Mission Community Hospital, respectfully opposed this message. Thank you.

Thank you.

Hello. Ryan Elaine with the California Retailers Association and respectful opposition. Thank you.

Thank you.

Morning, Chair and members. David Krieger for United Hospital Association. Respectful opposition. Thank you.

Thank you.

Good morning. Chair and members. Tim Madden, representing the California Chapter of the American College of Cardiology, the California Society of Plastic Surgeons, the California Rheumatology Alliance and Grossmont Healthcare District, in respectful opposition.

Thank you.

Stuart Waldman with the Valley Industry and Commerce Association VICA, respectfully, in opposition.

Thank you.

Sarah Dekette, on behalf of the Rural County Representatives of California, in respectful opposition.

Thank you.

Morning, Mr. Chair and members. Dennis Cuellos-Romero, representing the California Health Plus Advocates, the Community Health Centers in the State of California. In opposed unless amended position. Thank you.

Thank you.

Mr. Chair and members. Rand Martin. On behalf of Aveanna Healthcare, which provides private duty nursing to children with complex medical conditions in the home, in respectful opposition, thank you.

Thank you.

Christy Foy. On behalf of the California Dialysis Council, in opposition, thank you.

Thank you.

Good morning. Jennifer Snyder. On behalf of the California Association of Health Facilities, respectfully. In an opposed, unless amended position.

Thank you.

Kelly Brooks. On behalf of the Urban counties of California and the California State Association of Counties, in respectful opposition.

Thank you.

Megan Allred. On behalf of San Antonio Health, in opposition.

Thank you.

Ms. Settle short. On behalf of the Alliance of Catholic Health Care and Peach, the community safety net hospitals, in opposition.

Thank you.

Good morning. Ashley Hoffman. On behalf of the California Chamber of Commerce, in opposition. As a job killer. Thank you.

Thank you.

Good morning, Mr. Chair. Justin Fanslau. On behalf of Davida. In the respectful opposition, thank you.

Thank you.

Good morning, Mr. Chair and members. Peter Kellison. On behalf of the following organizations and oppose California Association for Health Services at Home, California Assisted Living Association and U.S. Renal Care

Thank you.

Thank you Mr. Chair and members, Jason Schmelter. On behalf of the Boards of Supervisors of Kern and Fresno counties, in opposition, Thank you.

Thank you. All right, it appears that that concludes the in person testimony in opposition. We're now going to our teleconference line. Last, a moderator to queue up individuals who are either in opposition or support on this bill.

Again, this is Senate Bill 525, and anyone who's been listening understands the way you do this is name, affiliation and say opposed or support, so we know. Thank you.

Thank you, Mr. Chair. For those who wish to speak in support or opposition of SB 525, please press one, then zero. As a reminder, if you press one, then zero a second time, this will remove you from the comments queue. We are now going to go to line 96. Line 96, your line is now open.

Hi, I'm Amaya, and I am in support of the bill.

Now go on to line 34. Line 34, your line is now open. We're now going to move on to line 18. Your line is now open.

Thank you.

Good morning. Alex Graves of the Association of Independent California Colleges and Universities, including several that operate health facilities in the state, and respectful opposition.

Thank you.

Line 74, your line is now open.

Thank you. Kim Stone, Stone Advocacy on behalf of the California Orthopedic Association and respectful opposition.

Thank you.

Line 16, your line is now open.

My name is Steve Stark. I'm the CEO of Orchard Hospital in Gridley, California. If this bill passes, it will directly close our hospital, which is why I stand in opposition and urging.

Thank you.

Line 25, your line is now open.

Mr. Chair and members, Dave Butler, on behalf of UCAN, the United Chamber Advocacy Network, a coalition of 10 local chambers of commerce in four Northern California counties in opposition.

Thank you.

Line 148, your line is now open. Line 148.

No.

Line 111, your line is now open.

Hello, my name is Juan Carlos. I am an organizer. I'm a coalition member of caregiving. Strong support of the bill.

Thank you.

Line 41, your line is now open.

Good morning. This is Sandra Poole, Western Center on Law and Poverty in support.

Thank you.

Line 136, your line is now open.

Thank you, Mr. Chair Members. David Gonzalez. On behalf of America's Physician Groups respectfully opposed.

Thank you.

Line 134, your line is now open.

Hi, I'm Brittany Keepers, an RN, part of DNA, and I oppose.

Thank you.

Line 19, your line is now open.

Hello, this is Sylvia DeRoy, senior citizen, and I am in great support of this bill on behalf of myself and all of the senior citizens who will be profoundly affected by passing this bill. Thank you.

Thank you.

Line 113, your line is now open.

Hello, my name is Naomi, and I'm a 17-year-old from California, and I want to support SB 525. Thank you.

Thank you.

Line 168, your line is now open.

Mr. Chair and members, Matt Brought, on behalf of the California Teamsters and Engineers and Scientists of California and strong support. Thank you.

Thank you.

Line 129, your line is now open.

Ida Dharnidharka, on behalf of the California Partnership for Health and the Central Valley Health Network, in opposed unless amended.

Thank you.

Ladies and gentlemen, once again, if you do wish to comment on SB 525 please press one, then zero at this time. We're now going to go on to line 169.

Mr. Chair and Members of the Committee, Brandon Marchy with the California Medical Association, in opposition.

Thank you.

Mr. Chair. We have seen several people signal that they wish to speak. Just a moment, please.

Thank you.

We'll move on now to line 171, your line is now open.

Natalie Bell with the California Business Roundtable, in respectable opposition.

Thank you.

And we will now move on to line 162, your line is now open.

Hi, this is Dowey from Valley Justice and the UU Justice Ministry of California. I'd like to support this. Thank you.

Thank you.

We'll now move on to line 173.

This is Dean Germano. I'm representing the Health Alliance of Northern California. We're in respectful opposition. Thank you.

Thank you.

Line 34, your line is now open.

Hi, Jennifer Bullard with the Orange County Business Council, in respectful opposition.

Thank you.

Line 142, your line is now open. Line 142, your line is open.

Hi there, this is Lily Dorn. Community Clinic Association of Los Angeles County respectfully opposing unless the bill is amended. Thank you.

Thank you.

Mr. Chair, there is no one else who signaled that they wish to speak.

Okay. Thank you. Moderator, great job. We're going to come back to the committee. Do any of our members have questions or comments at this time? Senator Laird.

Yes. For a second there, I thought I was the only person here besides the Chair. I have maybe a comment and a question of the author, and I support the general direction of this bill. My question has to do with rural hospitals, and the one constituent I identified that testified was from Watsonville Hospital, and last year it declared bankruptcy.

Everybody here voted for my bill that I got through in 19 days to establish a public hospital district.

The bid was accepted by the bankruptcy court after five days, and we spent six months raising $65 million to keep that hospital in business. And it is in business now in public ownership.

And the irony is that I surveyed all the hospitals or the major ones in my district, and there's this real split between wealthy areas on the coast and disadvantaged communities away from the coast, and the ones on the coast almost substantially pay their workers $25 an hour.

Now, this Bill would not be much of a difference to them. In my home hospital last year when this was proposed, the CEO said to me that, she said, we have no business paying less than that. If this went into effect, it would not have a substantial change to the hospital.

And I think that's true in Monterey. However, in the hospital in Hollister is going under. It is going month to month, and there's a chance it's bankrupt.

And one of the hospitals that opposes this bill is in King City, and there are others that are in disadvantaged communities inland. And their problem is they don't have a good mix of patients. They have many more public patients than through private providers.

And while on the coast, this would not be a hit to hospitals, and they could live through it. The other one's on the edge of bankruptcy, and this would be a hit that they do not get revenue to compensate for.

And I know this is a concern around the state, with the Madeira hospital closing and up to 30 hospitals being on the edge of bankruptcy. Is there a way you can address that in this bill?

In a way that, because it's tough, we do cookie cutter bills, meaning it applies to the whole state, and there are some hospitals that survive this fine, and there are others. This would be a hit, too.

Is there a way that you have considered trying to address that in this bill in a way that it doesn't whack those hospitals that are in bankruptcy or on the edge.

Thank you. Thank you for the comment and for the question. I think that many of our health care systems or hospitals should hire you to come in and help do an analysis and address these issues. I don't see the fix as being so simple. I don't think it's one single issue or another single issue.

Even if you take the issue of reimbursement rates, the Madeira hospital, actually, they had a higher private sector cases and patients.

So it wasn't that they didn't have enough on the private, and yet they went under. So I think that it's much more complicated. It's not one single issue that's going to address this.

Having a shortage of staff is a critical issue that is being talked about, but it's part of the solution here. We have to have more staff and we have to have more staff that gets paid the right way.

Last year, in our last budget, we added $1.0 billion in total for healthcare workforce development. That's a major investment by the State of California on the issue of the shortage, to be able to do the training and recruit.

So there's the issue of the shortage. There's the issue that there are some hospitals or healthcare systems that do need financial assistance, but I don't think it's just financial assistance.

I think it's the whole comprehensive approach as to what's going to help them be able to move forward. We also have many hospitals and healthcare systems that are doing well. They're doing well, and it's not just on the coast of the state, but they are doing well.

So I don't see this as a cookie cutter to fix the entire healthcare system in California. I see it as a way of addressing a significant issue.

We have to care about the workers in the workforce, in these hospitals, in these clinics, and in our healthcare system. And right now, you saw them one after another after another, the work that they do, the commitment that they have, and they're living in poverty, many of them.

That's just not fair. So I don't pretend to fix the whole healthcare system, all of the issues, but I do think that this is a critical issue that must be addressed.

I would be more than willing to put energy, my time, into other issues. I think that if there are hospitals that need that kind of assistance, the way that you jumped in to do the hospital in your area, let's do it hospital by hospital.

But I don't think, on the other hand, we should just somehow give assistance to every hospital, regardless of whether or not they need it, this bill is not intend to fix everything in the hospital, in the healthcare system.

We do attempt to fix a critical issue, which is the people that work in the healthcare system and how they should be treated.

Well, let me comment, because I agree with your statement about the workers, and I don't interpret your bill to fix the entire system.

I just think there are certain parts of the system that might have a real problem with this, and some kind of solution needs to go hand in hand with the bill, that the bill can't stand totally alone to do that. And that is the tough thing here.

I know that we have colleagues that have introduced both budget things and maybe even legislation.

I haven't seen it, to try to address the hospitals that are going under. And I agree, some of the ones that I refer to as being on the coast in my district, they do not need the help if this bills happen. But some of them that are there that serve disadvantaged communities do.

And so the question is, is there a way to differentiate and do something hand in hand with this? And I intend to move the bill along. I am just hoping that there's an attempt to address this issue along the way, because it is just very difficult.

The voters have to agree next year for me to move into Hollister. But I have been talking to them, and you are right, because they are not transparent the way that Watsonville hospital was. They don't have the community backing and support because they've done that the way Watsonville did.

And Watsonville was run by a hedge fund and the public bought it out, and they'd been, I don't want to have to hire an attorney. They were not doing a good job.

And so they had to renegotiate for the first time some of the contracts with the providers to get adequate reimbursements to be sustainable.

I don't know that that is doable with some of the others, but I just was hoping you'd have a commitment to look at that after this hearing and maybe even work with our colleagues that are trying to rescue distressed hospitals to see if there's a way to do it hand in hand, because I think that's going to have to be addressed if this bill moves forward.

Sure. And I also know that Senator Caballero has had a series of forums and informational meetings, bringing in various entities and stakeholders. And so I've been participating, me and my staff have been participating in that because we want our healthcare system to be healthy.

We want our healthcare system to prosper but we want to prosper for everyone, for the patients, as well as for the working people and for the executives.

So I commit to doing whatever I can, and I know that if there's something that makes sense to insert in this bill, we certainly will. But the focus for this particular bill, obviously, is the standard of living for those working men and women.

And I get that. That's one of the reasons I'm going to be voting for it. But I appreciate the commitment. The other issue I was going to ask about, I think your amendment took care of, and we can revisit that if it didn't.

But the whole notion of everybody that passes through a hospital campus being subject to this seemed like an issue, and it seems like your amendment tightened that down.

Yes, we tried with that amendment. Thank you.

Okay. Thank you very much.

Senator Smallwood-Cuevas.

I am so honored to be a co-author with you on this bill. And it was an education just to see the level of expertise and skill in our hospitals. And when workers do well, our communities do well.

So, yes, it's about making sure that workers have a living wage, but we know when you have 400,000 plus workers go back home with a living wage, it means the community is going to be fundamentally uplifted.

And the one healthcare worker who talked about both, who talked about being homeless and working in our county, we're trying to get folks, particularly folks who look like me, who are overrepresented, sleeping on the streets.

And no matter where you are in my county, you cannot afford the rental cost if you are not earning a living wage. I am so honored to be a part of this important bill.

And I want to say in a number of industries where we have raised standards for workers in terms of wages, in addition to making sure we are filling vacancies, we reduce the turnover, which saves costs, which help companies invest monies in other places to do the things that they need to do to keep their industries running.

And so this is about strengthening the workforce. It's about making sure folks are not leaving the industry.

And it's about reducing the turnover that saves the industry's money to do more of the work to make their businesses sustainable and in this case, providing care to our community. So I want to move to a vote.

Mr. Chair, and thank you so much for your hard work and to all the workers who shared their experiences with us today.

Thank you. Senator Durazo. Just one thing I want to follow up on, which was probably more of a focus of the Chair and committee staff work. And so forth, which was concerns that registered nurses have coming into right up to the hearing today.

I really want to ask you this question for your thoughts or insights going forward, not only in your capacity as the state Senator here and the author of this bill, but because you've been at the bargaining table and understand the dynamics there.

And my sense is that part of the concern, I don't want to mischaracterize it, but is that as important as raising the floor is for most healthcare workers, that if we have a floor that's actually lower in some cases for our ends, that it may disadvantage them when they're at their own bargaining tables, when they're seeking classification studies and things like that or comparables.

We've wrestled with suggestions as to how to maybe deal with that, giving it the credibility of a legitimate concern. But any thoughts on your part going forward in terms of possibilities for dealing with that issue?

Well, thank you, Mr. Chair, and I appreciate you raising the issue here. This is a minimum. This is the bottom wage. This is not the top. And in all my experience, negotiating side by side with workers in many industries, when you lift the bottom, then you lift the top. And that's always been my experience.

We never meant for minimum wage to stop anybody from doing better. We never meant the minimum wage would be the most that you could make.

It meant that those at the bottom had to have the minimal amount to be able to get to work, survive, raise their families, raise their kids, the minimal. And so that's always been my experience.

I don't have an answer for that particular concern, but I've never seen when you lift the bottom that the top goes down. That's not been my experience. I haven't heard of particular examples of how that takes place. But in LA, the cost of housing has released a cost of housing.

$25 is going to qualify workers for subsidized, very low income housing. Think about that. I don't know how, by lifting them up, it hurts anybody else. It allows them to circulate more money in the economy than what they now have available to them.

So I don't have an answer to that other than in all my experiences when we have lifted the bottom, we have lifted everybody along that way. So, thank you for your question and comment.

And thank you for your response. I will say for my part, and I'm sure not to put words in your mouth as the author, but that we will continue to be open to those concerns and any constructive ways to deal with them.

With that, I think we've really covered everybody who's here in terms of an opportunity to comment. You have an opportunity to close now, Senator Durazo, and then we'll call for the roll call vote.

First, I want to thank all of the extraordinary people who showed up today from all over the state to testify and took 10 seconds, but they probably took hours and hours to travel here, but they took 10 seconds.

It was that important to them, being medical assistants, resident doctors, community health advocates, cooks, dental schedulers. These are very hardworking people who make our healthcare system what it is today, and we need them, and we need more of them.

So that's the first thing I want to do, is to thank them. And I also want to thank everybody else, all the others who lead our healthcare system.

We need to be working closer together on fixing where there is a fix that needs to be done, but also look at our healthcare system as a whole in a comprehensive way and not in pieces. So I thank everyone who came. I thank everyone who participated. I was listening closely, taking notes.

I will continue to work hard to make this a bill that makes sense for California. I thank you, Mr. Chair, and the committee for all of the work that you've done, and I ask for your aye vote.

Thank you, Senator. And just before the roll call vote is called, I do want to thank all the witnesses on both sides, support and opposition, because they're really one of the most comprehensive representations I've seen in two plus years in this committee.

In terms of folks coming in from all over in really various sectors within this issue area to testify, I can assure you that we're all listening very carefully, including the committee staff, but the members as well.

So that is appreciated and appreciate you, Senator Durazo, wading into a leadership role into an area that I feel needs to be addressed as well. It sounds like that's the consensus of the Committee Members who have spoken today.

So thank you for your leadership, and we'll see how things continue to evolve on this. With that we'll ask the assistant call the role, please.

Give a motion.

We do need a motion.

I made the motion to move forward to a vote.

Thank you.

File item number one, SB 525. The motion is do pass, but first amend and re refer to the Committee on Appropriations.

[Roll Call]

That bill is on call and currently has three aye votes.

All right, we'll keep the bill on call until everyone's had a chance to vote. Thank you, Senator Durazo. Yes. On the recommendation of a couple of people in this room, we're going to take a brief five minute, actually recess just to allow an orderly transition here.

There's a lot of people moving around, trying to get through the doors, trying to get in and out, so we'll resume in 5 minutes.

The five minute recess now and resume per the file order on the measures to be heard today. And so the next one will be item number two, SB 252. Author is Senator Gonzalez. This has to do with public retirement systems. Senator, welcome. And you can begin whenever you're ready.

Okay. Thank you, Mr. Chair and Members, I'm here today to present SB 252, which will provide the California Public Employees Retirement System and the California State Teachers Retirement System with a seven to 12 year time frame to thoughtfully divest their current $15 billion of combined fossil fuel holdings, holdings that are causing havoc in our communities with pollution. Code red for humanity, per the UN, and in some cases, holdings that include egregious labor and human rights violations.

Two of the most respected investment firms in the country, BlackRock and the Makita investment group, recently studied the impact of fossil fuel divestment on pension funds, and both firms independently concluded that funds have experienced no negative financial impacts from fossil fuel divestment and even found evidence of modest improvements in Fund returns. This is why over 1500 institutions, including our own UC and CSU systems, have also divested.

And even with the provision to add a seven to 12 year off ramp, the pension funds unfortunately remain opposed and continue to tout a net zero plan that will not be realized for the next almost three decades. And an unsuccessful strategy of engagement with companies notorious for greenwashing, transparency, at the least, is needed with our pension systems.

And in the Bill language, it also empowers both pension boards to refrain from implementing this Bill should they determine in good faith that it would impact their fiduciary responsibilities under the Constitution. So while relying on engagement may extract short term symbolic gestures, fossil fuel companies like ConocoPhillips, which just received approval to begin construction on the willow project that will siphon 180,000 barrels of oil a day out of the Alaskan wilderness, will continue their long term extractive practices.

I'll also note that CalPERS has $350,000,000 of state employee retirement money invested in ConocoPhillips, and Calsters has used the retirement funds of teachers to purchase nearly 250,000,000 of ConocoPhillips investments. Further, many of the over 100 fossil fuel companies the pension funds are currently invested in have more egregious have, in some cases, egregious labor and environmental records. For example, the Morgan Stanley Climate Index measures a company's long term financial relevant ESG ratings.

Exxon, of which CalPERS owns 1.2 billion in holdings, is strongly misaligned with the climate goals to cap temperature rise they are projected to go to 3.2 degrees, which they need to be under, of course, two degrees celsius within the next three decades. Chevron, of which Calsters owns 580,000,000, is notorious for its decades of pollution in Ecuador and for numerous violations of the Fair Labor Standards act towards its California employees.

Aramco, of which CalPERS invests $158,000,000, is owned by the Kingdom of Saudi Arabia, which is notorious for human rights violations and ranked 141st out of 149 countries of the World Economic Forum's gender equity rankings. As our constituents are facing sea level rise, record setting heat, endless drought, and our firefighters are actually fighting year round mega fires caused by climate change, we must ask the glaring question, why?

Why is California, the world's leader in climate action, continuing to maintain the status quo and a contradictory policy of finding climate change while simultaneously investing billions in its primary driver? This is why we're here today with over 100 stakeholders in labor and environment and many beneficiaries themselves testifying today and support today. Excuse me. I have Dr. Claire Brown, Professor of economics, Samarita, and Director of the Center for Work, Technology and Society at the University of California, Berkeley.

And I also have Ron Rapp with the California Faculty Association, representing a broad coalition of labor supporters. Mr. Chair, I thank you, and I respectfully ask for an aye vote on SB 252.

Okay, thank you, Senator. And we will move to the lead support witnesses, starting with Dr. Claire Brown. Just a reminder, the way we divided this up, if you weren't here earlier, is when you have one or two lead witnesses. It'll be a maximum of three minutes each, and that was to accommodate larger groups that we had on another Bill. So please proceed when you're ready. Thank you.

Thank you. Good morning, Senate Labor Committee. I'm Claire Brown, a labor and climate economist. As a Professor of economics at UC Berkeley, I want to explain why CalPERS and Kalisters must divest to fulfill their fiduciary duty. I'll address three main points. Point 1 is fossil fuel assets are a bad investment. CalPERS and Calster's corporate bonds finance fossil fuel expansion. Yet the International Energy Agency has made clear that no investment in expanding reserves is a good investment.

Oil, gas and coal companies already have fossil fuel reserves that will become stranded assets. Assets can become stranded very quickly. CalPERS, 385,000,000. And CalPERS, $323,000,000 in Russian fossil fuel stocks now have a value of zero, thanks to the US government sanctions. Point number two, divestment removes risk from the portfolio and does not reduce returns. Studies show that excluding fossil fuels from a portfolio does not harm returns. The MSCI World Index that excludes fossil fuel companies has outperformed its standard index over the past 13 years.

A study showed that if CalPERS and counselors had divested in 2000 and 910 years later, their portfolios would have earned even higher returns by $17.4 billion. SB 252 affects only a small group of fossil fuel companies and less than 2% of the public pension's portfolio by market value. Removing this small group does not reduce diversification and does not constrain growth of the portfolio's value.

Yet this small group of fossil fuel companies represents most of the financed emissions in the portfolio, and they're a threat both to the pension's financial risk and to their net zero goals. Point number three, CalPERS and Kaustra's shareholder engagement has been ineffective. Big Oil is even backtracking on their previous climate pledges. Engagement primarily means voting on climate resolutions for directors or in the annual meetings, and CalPERS and calsters often vote no against climate resolutions.

Overall, 252 fulfills fiduciary beauty because divestment reduces financial risk and decarbonizes the portfolio and reduces the financial support of fossil fuels. So please vote yes on SB 252.

Okay. Thank you very much. I appreciate you trying to hit that three minute target, and we'll ask the next witness to do the same thing. Mr. Rapp, good morning.

Chair Cortese and Members Ron Rapp. I'm the Legislative Director for the California Faculty Association. CFA is a proud co sponsor of SB 252 and would like to thank Senator Gonzalez for her leadership on this issue. The California Faculty Association, if you don't know, represents over 29,000 faculty, including tenure track professors, lecturer, faculties, librarians, counselors and coaches on all 23 CSU campuses. The CFA's work on fossil fuel divestment spans several years and grew out of a resolution passed at our statewide Assembly.

The majority of CFA's 23 locals have called for divestment, including San Diego, Los Angeles, Bakersfield, Fresno, San Francisco, Stanislaws, Humble and more. In addition, SB 252 is supported by several statewide unions, including AFSME, the California Nurses Association, the California Federation of Teachers and a number of other unions representing nearly a half a million Members in the public pension system. So SB 252 is a Bill that the CFA is passionate about for many reasons. One, climate change is real.

It's already causing severe drought, heat waves, increased wildfires and rising sea levels. Two, the production of fossil fuels and the effects of climate change resulting from their use disproportionately impacts Low income communities and communities of color because their manufacturing plants are located in these communities. I grew up in one of these communities, by the way. The State of California has passed a number of pieces of legislation and issued several Executive orders, orders related to climate change. In this policy area, we are considered a national leader.

Yet our public pension systems continue to invest nearly $15 billion in fossil fuel companies, which is contrary to our efforts to curtail the severe impact of climate change on our environment and our economy. Although the public pension systems say they're working towards divestment in the fossil fuel industry, our Members believe, and hundreds of thousands of Members of the public pension systems believe, that little has been done to address the issue.

The Members of the California Faculty Association believe it is time to end our investments in these corporations. They no longer want their retirement dollars invested in the very companies that are contributing to climate change. A key priority of CFA's mission is to ensure a secure financial future for our retirees. We are confident that divestment is financially prudent. A number of studies back this up.

We're proud to be working in an expansive coalition to pass SB 252 with over 130 labor, climate, justice, youth, environmental and health groups on this important issue. It is for these reasons that we respectfully request your. I vote thank you.

Okay. Thank you. That would conclude the lead support witnesses. We're going to stay on the support side of things for a moment here and ask if there's anyone in the room who wishes to step up and express a support position. If you do, this is the time to start lining up. Pay attention to the sergeants here. They will help keep order. You obviously can't have everyone line up at once, but we do appreciate a single file line that's moving forward. Now, this is the opportunity.

If you listen to the prior hearing, they did a great job where you get to say your name, affiliation and in this case, support. And that'll be the same for the opposition later when we get there, so please proceed. Thank you.

Melanie Morelos with the Greenlining Institute in support.

Good morning. Janice O'Malley with the American Federation of State County Municipal Employees in support.

Good morning. Tristan Brown, CFT, union of Educators and Classified Professionals, in support.

Chair Members Austin Webster with w strategies on behalf of the Faculty Association of California Community Colleges, in support.

Melissa Romero with California environmental voters in strong support.

Miguel Alatorre, fossil free California, in strong support.

Mike Erenas, the people for clean air and water from Kettleman City in strong support.

Martha Turner, CalPERS recipient, strong support.

Sandy Emerson, fossil free California, support.

Megan Shumway, PERS recipient in strong support.

Glenn Fieldman, CalPERS Member, Fossil Free California Member, very strongly support. Thank you.

Thank you.

Sheila Thorne, CalPERS Member, retired CFA, strong support.

Pat Ferriss, third act, strong support.

Diana Cassidy, third act, Sacramento, strong support. Thank you.

Margaret Piper Mcnulty, Faculty Association, Community Colleges of California, strong support. Thank you.

Miriam Ide, fossil free California, strong support. Thank you.

Leslie Ferguson, California Peg, professional engineers of California government and a CalPERS Member, strong support. Thank you.

Julian Cluster, youth versus apocalypse, strong support. Thank you.

Greg Cluster, CalSTRS Member and longtime CTA Member, strong support. Thank you.

Good morning. Christina Scaringe with the Center for Biological Diversity in strong support. Thank you.

Reena Myers-Dollcamp with earth guardians in strong support.

Thank you.

Magdalena Myers-Dollcamp. She/her pronouns, almost 15 years old. Strong support.

Thank you.

Marie Elena Rivera. I'm 20 and I am for youth vs. apocalypse in strong support. Thank you.

Thank you.

I'm Hondo, 13 years old, living in Oakland. 8th grade, Member of Warriors for justice. I support.

Thank you.

My name is Amara. I'm 13 years old. I'm an OUSD student and my family does organizing with homeless empowerment. Strong support.

Thank you.

Dana Ignacio, 14 years old with youth versus apocalypse. Strong support.

Thank you.

Good morning. My name is Brian. I go to Urban Promise Academy. I'm 14 years old and I strongly support.

Thank you.

Good morning. My name is Corey Zhang. I teach 8th grade ethnic studies in Oakland. I'm a CalPERS recipient and I urge you to support.

Good morning, Members. Kyler Joaquin here this morning on behalf of the city and County of San Francisco in support. Thank you very much.

Thank you. All right, that concludes those who are in the Committee room who wish to express a support position in person. We will now go to lead opposition. Lead opposition. Witnesses can come forward again if you have 23. All right, so it'll be two minutes each for a total of six. And you may identify yourself and proceed.

Thank you. Good morning, Mr. Chair and Members of the Committee. Joycelyn Martinez Wade with the California State Teachers Retirement System. The board's policy is to oppose legislation that infringes on its constitutional fiduciary duty and investment authority in order to secure the financial future of California's teachers and other educators and invest the trust funds for the exclusive benefits of the trust's beneficiaries.

Calstras believes climate change is a major threat to all business sectors, and we must prepare a portfolio for the global transition to a net zero economy in order to minimize risk to the portfolio. We are not waiting. We are proactively taking steps now to reduce emissions across the portfolio in both the short and long term. We are investing billions of dollars in Low carbon solutions.

We are participating in solving for the lack of robust and comprehensive carbon emissions data needed to manage climate change risks in our portfolio. SB 252 moves calusters away from the frontline efforts to manage risk and changes of focus to divestment, which ignores Kauster's exposure to the broader economy and undermines efforts to reduce emissions and transition to a Low carbon world. The risks associated with climate change cannot simply be divested away. We have to do the work across the portfolio.

There's no way to know for certain whether the portfolio will do better or worse with divestment of a certain sector. What we do know is that divestment reduces diversification of assets and limits Kauster's ability to shape corporate behavior for long term sustainable growth, which adds risk to the portfolio. And past experience has shown divestment is not effective and can result in long term losses to the Fund. For these reasons, we must respectfully oppose SB 252. Thank you.

Okay. Thank you for being here. Next witness, please.

Good morning, Mr. Chair. Committee Members Danny Brown on behalf of the CalPERS Board of Administration. CalPERS recognizes that climate change poses a material risk to society, the global economy, and CalPERS investments. And CalPERS has a strong commitment to the reduction of fossil fuel emissions. However, as a global investor with fiduciary duty to our Members and our employer partners, CalPERS does not believe that divestment is an effective solution to this problem. It won't change the demand for fossil fuels or reduce greenhouse gas emissions.

Instead, our strategy is fourfold engagement, advocacy, integration and investment. Through active engagement with the companies in our portfolio, we can generate transitions to a Low carbon economy. We advocate for changes by joining some of the world's leading investors to create sustainable economies across the globe. We're integrating the risks from climate change across our portfolio to better inform our investment decision making. And we are putting our capital to use to meet our financial returns to help drive decarbonization by investing in Low carbon and climate solutions.

More than 17 billion of the real estate portfolio is invested in assets that have sustainable certifications, and more than half of the infrastructure portfolio is invested in renewable energy, energy efficiency, infrastructure, sustainability certified and carbon neutral assets. Finally, our global public equity portfolio is a diversified and largely passive index Fund. Divestment is a form of active risk taking that creates volatility and generates a tracking error, which means a divestment action could generate a positive or negative return.

Some would like you to believe that divestment from fossil fuels will only result in a positive return based on a historical snapshot, we also know that commodities are a hedge against inflation, so it's no surprise that energy stocks have outperformed the market over the last few years. No one can predict the future, and that is one reason why CalPERS has a passive, diversified public equity portfolio rather than try to time the market.

We appreciate what the author is trying to accomplish here, but the CalPERS Board of Administration, respectively, asked for a no vote.

Okay, thank you. Next witness.

Thank you, Mr. Chair and Members. Meagan Subers, on behalf of the California Professional Firefighters representing 34,000 firefighters and emergency medical services professionals in California, in respectful opposition to SB 252, many of our Members, as you know, are CalPERS Members and rely on the system for a secure retirement as context. CPF has opposed divestment measures across various types of asset classes because these measures do not align with the fiduciary duty of the retirement system.

Similarly, we're concerned that SB 252 will drive divestment at CalPERS in a manner that is inconsistent with the fiduciary responsibility of the system and the interest of our Members. Public employees dedicate their careers to State service, in many cases earning less than their counterparts in the private sector, with the promise of a secure pension waiting for them in retirement.

It is the duty and responsibility of CalPERS and other public pension funds to ensure that the retirement system is funded because of the physical and emotional impact of the job. Firefighters cannot simply decide to work longer or go back to work post retirement if the Fund suffers as a result of a strict divestment policy set by the Legislature. CalPERS maintains a robust divestment strategy that empowers the system as a shareholder to utilize constructive engagement where consistent with its fiduciary responsibility.

And we believe the current system in place at CalPERS appropriately balances their fiduciary responsibility to our Members. And for those reasons, we are opposed today. Thank you.

Okay. Thank you for being here. Is there anyone in person who wishes to express an opposed position here in the room? If so, please step forward. Identify yourself, your affiliation and your opposed position. Thank you.

Thank you, Mr. Chair and Members, Cassie Mancini, on behalf of the California School Employees Association, respectfully opposed, unless amended. I'm grateful for our continued conversations with the governor's office.

Thank you.

Morning.

Just name, affiliation and position.

Johnny Pena, with the League of California Cities, in respectful opposition. Thank you.

Mr. Chair and Members. Paul Diero, representing the Western State Patrol Association, in opposition. Thank you.

Good morning. Carlos Machado with California School Boards Association, expressing our opposition. I'm also here on behalf of the Rural County Representatives of California and the California Special Districts Association. Thank you.

Mr. Chair. Members. Mike Monagan, on behalf of the California State Building and Construction Trades Council, in opposition.

Thank you. Anyone else in the room? All right. Let me just pause and say a universal good morning to everyone who's shown up, and especially those testifying. Some of you have been nice enough to say good morning to all of us, and I don't think I've been reciprocating, so I just want to be polite to everyone.

We are now going to move to the teleconference line, and this is where we have a maximum of 20 minutes for opposition and support combined. People who are calling in, they will have that same opportunity. Name, affiliation and support or opposed as the case may be. So moderator, if you can please queue up those witnesses, we'd appreciate it very much.

Thank you, Mr. Chair. For those who wish to comment in support or opposition to SB 252, please press one than zero. And as a reminder, please do not press one then zero a second time as this will remove you from the comments queue. We will now go to line 159. Your line is now open.

Good morning, chair and Members. This is Igor Tregub, chair of the Alameda County Democratic Party on behalf of the Alameda County Democratic Party, we are in strong support.

Thank you.

Line 174, your line is now open. Line 174.

Catherine Tattersfield, Valley Justice Coalition, strong support.

Thank you.

Line 185, your line is now open.

Yes, thank you. My name is Francesca Wander, a voting constituent of Senator Angelique Ashby. I'm also a Member of SEIU and of CalPERS and a Member of California Indivisible state, strong, Indivisible Sacramento, indivisible Yolo and Indivisible San Francisco calling in strong support.

Thank you.

Line 93, your line is now open.

Yes. Hi, Jennifer Tanner. On behalf of all 80 groups of Indivisible California State Strong. We are in strong support of this Bill. Thank you.

Thank you.

Line 17, your line is now open.

Hi, Lydia Ponce calling in from Venice. I am with Society of Native Nations, both in Texas and in California with the American Indian movement. We strongly support SB 252 and. Thank you. Have a great day.

Thank you.

Line 208 your line is now open.

Good morning. This is Cora Striker for climate Action California strong support.

Thank you.

Line 63, your line is now open.

This is John Bottorff, cleanearth4kids.org, strongly support SB 252.

Line 152, your line is now open.

Thank you.

Sakira Carter, on behalf of Sierra Club California, in strong support.

Thank you, thank you.

Line 66, your line is now open.

Good morning. Kathy Schaeffer, on behalf of the San Fernando Valley and Los Angeles Climate Reality project and as a Cal Stirs Member, in strong support.

Thank you, thank you.

Line 215, your line is now open.

Hi, it's Cindy Hernandez. I'm an environmental assistance intern with parents, with kids, and I attend UCSD, and I'm in support of SB 252.

Thank you.

Line 216, your line is now open.

Hello, this is Suzanne Hume CalPERS Member and educational Director and founder of cleanearthforkids.org, standing in strong support of SB 252. Our children need clean air to breathe and a livable future. We are standing in support. We represent children, teachers and families throughout California. Yes, on SB 252.

Thank you, thank you.

Line 198, your line is now open.

Yes, I'm Deborah Sylvie, health beneficiary and Member of council three California, in strong support of SB 252. Thank you, thank you.

Line 80, your line is now open.

Good morning, chair and Members. Jim Lindbergh, on behalf of the Friends Committee on legislation of California in strong support.

Thank you.

Line 37, your line is now open.

Yes. Christine Kimball Schumacher from Woodland, California, a Member of fossil Free California for a very long time in strong support.

Thank you.

Line 147, your line is now open.

Hi. Jennifer Coney, CalPERS Member and representative of 350 Bay Area action, representing over 27,000 people. And we strongly support SB 252.

Thank you, line 189, your line is now open.

Good morning. My name is Kelsey Craig. I'm a Member of the professional engineers from California government. Second, I'm a CalPERS Member and I strongly support. Thank you.

Line 85, your line is now open.

Hi, my name is Catherine Webb. I'm with 350 Sacramento, and I am in strong support.

Thank you.

Line 62, your line is now open.

Hi, Pam Jerizzo, a CalPERS retiree living in Walnut Creek, California. I'm a Member of Sustainable Rossmoor and Democrats of Rossmoor, and we urge you to vote aye on SB 252. Thank you, thank you.

Line 166, your line is now open.

Hi, my name is Deborah Moore. I'm based in Berkeley, California. I'm representing third act national. We're a new organization. We have nearly 5000 Members in California, all of whom are over 60, many of whom are CalPERS and CalSTRS beneficiaries and we strongly support SD 252 and urge...

Line 45, your line is now open.

Good morning. I'm Carlos Davidson. I'm a CalPERS pensioner and a California faculty Association Member. I urge strong support. Thank you very much.

Thank you.

Line 194, your line is now open.

Good morning. This is Deborah Garvey, PhD, a former academic economist, Member of fossil Free California, indivisible San Jose, calling in strong support. Thank you, thank you.